1982-07-19

ROUTINE PROCEEDINGS


Mr. Fred King (Okanagan-Similkameen):: Madam Speaker, in view of the disparity between the limited, in-house review by assistant deputy minister Goodwin announced by the Minister of Indian Affairs and Northern Development and the comprehensive independent inquiry recommended by all members of the House standing committee, I move, seconded by the hon. member for Bow River (Mr. Taylor):
That this House urge the Minister of Indian Affairs and Northern Development to arrange that Mr. Goodwin appear before the members of the standing committee in order that he may be fully informed of those anxieties which resulted in the recommendation from that committee for a full and independent inquiry into affairs and activities of the British Columbia regional office and the Westbank Indian band.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CROWN CORPORATIONS
Mr. Blaine A. Thacker (Lethbridge-Foothills):: Madam Speaker, whereas Petro-Canada and over 400 other Crown corporations are in a special income tax position, namely, they pay much less, and in many cases pay no income taxes or direct taxes, and whereas this erodes the tax base resulting in higher income taxes for the rest of us, 1 move, seconded by the hon. member for Bow River (Mr. Taylor):
That the government immediately return Crown corporations to private share ownership so that those companies can pay their fair share of taxes and citizens can receive tax relief.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


STATUS OF WOMEN
Hon. Flora MacDonald (Kingston and the Islands):: Madam Speaker, I rise to propose a motion under the provisions of Standing Order 43. It has been seven months since the Charter of Rights was given Royal Assent in Canada. The primary objective of the entrenched charter is to remove all forms of discrimination in Canada. The most blatant contravention of the Charter of Rights is that of the discrimination against Indian women in Section 12(l)(b) of the Indian Act. I move, seconded by the hon. member for Victoria (Mr. McKinnon):
That the government immediately introduce legislation to remove Section 12(l)(b) of the Indian Act and thereby accord the same status to Indian women as to Indian men.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


NORTHERN AFFAIRS
Mr. Peter Ittinuar (Nunatsiaq):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. A recent survey conducted in three northern communities reveals that the price of essential foods such as milk, hamburger, eggs and bread are, on average, 80 per cent higher than in Ottawa. There is a pressing need to alleviate this disparity between northern and southern prices. Therefore I move, seconded by the hon. member for Skeena (Mr. Fulton):
That this House call upon the government to initiate a task force on the cost of living in northern Canada, in order to investigate the causes and identify solutions to the high cost of living in the north.


Madam Speaker:: Is there unanimous consent for this motion?

July 19, 1982


Some hon. Members:: Agreed.


Some hon. Members:: No.


SUPPLY AND SERVICES
Mr. Arnold Malone (Crowfoot):: Madam Speaker, in light of
the fact that Canada Post is embarking upon a policy to assure, at higher postage rates, one-day service within a limited number of specified Canadian cities but allows the continuation of unsatisfactory services in many other cities and throughout all of rural Canada, and since persons living in larger urban centres have free door-to-door delivery of mail, whereas rural people of necessity must rent a post office box at rates of $12 to $20 per year, and since urban persons throughout Canada enjoy the privilege of a private telephone while rural business persons may undertake hundred thousand dollar business deals while several neighbours listen to the conversation on a party line, and the same policy applies to cable TV which serves villages but not farm persons, I move, seconded by the hon. member for Bow River (Mr. Taylor):
That this House deplores the discrimination in public service between rural and urban Canada and will no longer tolerate any further examples of such bias on a rural-urban basis with public funds.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


SMALL BUSINESS
Mr. Albert Cooper (Peace River):: Madam Speaker, 1 rise to move a motion under the provisions of Standing Order 43. Every day small businesses are being forced into bankruptcy and receivership as a direct result of high interest rates. Therefore I move, seconded by the hon. member for Bow River (Mr. Taylor):
That the government immediately table a bill similar to the Farmers' Creditors Arrangement Act which would allow our small business people to negotiate a repayment schedule with their creditors, and save negotiations at gun point such as happened here in Ottawa last week.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


GOVERNMENT EXPENDITURES
Mr. Jim Fulton (Skeena):: Madam Speaker, 1 rise under the provisions of Standing Order 43 to seek the unanimous consent of this House to protest the continued lavish waste of the government. In view of the fact that four Liberal cabinet ministers, led by screech Rompkey, flew on Friday to St. John's, Newfoundland, to hold a farce described by one of the few businessmen in attendance as nothing but a free booze-up, and in view of the fact that the Minister of Energy last month flew to Europe on the Air France Concorde while forcing his staff to fly on Air Canada, I move, seconded by the hon. member for Selkirk-Interlake (Mr. Sargeant):
That this House immediately strike a committee composed only of opposition members to look into the drinking and flying habits of the geese and beavers across the way and, in particular, to investigate the $127,000 expenditure of the Solicitor General to design and test Liberal riot control helmets as these may soon be required for Liberal ministers.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


FAMILY VIOLENCE
Mr. Doug Lewis (Simcoe North):: Madam Speaker, across Canada directors of social service agencies and crisis centres, policemen and clergymen, are stating that one of the major impacts of the current economic recession is a noticeable increase in family violence, including wife battering, incest, and child abuse. As one measure which can be taken to alleviate these distressing and brutal symptoms of the economic turndown, under the provisions of Standing Order 43, I move, seconded by the hon. member for Kingston and the Islands (Miss MacDonald):
That the government move immediately to implement the recommendations of the all-party committee on family violence in Canada, to ensure that the serious problem of wife battering which now exists in Canada is dealt with on a priority basis.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.
July 19, 1982


EXTERNAL AID
Mr. Jim Manly (Cowichan-Malahat-The Islands):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. The June 28 budget calls for a reduction in development assistance for other countries by $75 million this year and $100 million next year. The government rationalizes this cut in badly needed aid by claiming that we will continue to allocate the same percentage of our gross national product since our GNP has also declined. I move, seconded by the hon. member for Prince Albert (Mr. Hovdebo):
That the government recognize that development assistance must have priority, that it restore the $175 million it slashed, and that it take immediate economic action to stimulate growth in our own economy instead of using a falling GNP as an excuse for cutting aid.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CANADA POST CORPORATION
Mr. Ron Stewart (Simcoe South):: Madam Speaker, Canadians are suffering generally from a crisis of confidence and nowhere is this more evident than in the loss of confidence and absolute frustration with our postal service. This is one of a litany of horror stories. A constituent of mine, Mr. Colwell of Barrie, mailed a most important registered letter at a cost of $2.15 on Saturday morning, July 3, 1982, to Toronto, the supreme distance of 50 miles. Post Office officials guaranteed Monday morning delivery. The letter was finally delivered at 11.30 a.m. on Wednesday, July 7, 1982, only after a pressing phone call. Therefore, under the provisions of Standing Order 43, I move seconded by the hon. member for Simcoe North (Mr. Lewis):
That the cost of each registered letter not delivered within 48 hours be deducted from the salary of the president of Canada Post and perhaps he will recognize the plight of Canadians with regard to their postal service.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.
Oral Questions THE PRIME MINISTER


MOTION UNDER S.O. 43
Mr. Neil Young (Beaches):: Madam Speaker, I rise under the provisions of Standing Order 43. In view of the government's desperate preoccupation with seeking out scapegoats on which to place the blame for the mismanagement of our economy, the most recent being public servants, low income families and recipients of old age security benefits, I move, seconded by the hon. member for Vancouver East (Mrs. Mitchell):
That this House expresses its amazement over the recent assertion of the Prime Minister that the Canadian public are to blame for the government introducing a measure to limit indexation of old age security payments, and that the Prime Minister's name be put forward as the person most likely to be the winner of this century's "making Machiavelli look like a pussycat" award.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Flora Isabel MacDonald: Madam Speaker, in the absence of the Minister of National Health and Welfare I direct my question to the minister responsible for the status of women. Less than 30 per cent of working women in Canada are now covered by private pension plans, whereas almost twice as many men, over 50 per cent, have such plans available to them. Every month that pension reform is delayed means that twice as many women are denied the opportunity to take care of their retirement in old age. When will the government, which gave a commitment to come forward with a green paper on pension reform last fall, last winter, last spring, and again this month-and now that has been postponed-come forward with a green paper on pension reform so that it will begin to deal with the pension inequities which exist for women?


Hon. Judy Erola (Minister of State (Mines)):: Madam Speaker, very soon; but I would like to add that no one is more aware than 1 of the inequities which exist in the pension scheme in Canada as it applies to women. We have been made even more aware of that by a number of seminars which have been conducted across the country, paid for by and large by grants from the Department of National Health and Welfare.

July 19. 1982
Oral Questions
Much of the green paper deals with statistics which have been made available to us through these pension seminars. 1 assure the hon. member that that green paper will be out very soon.


Flora Isabel MacDonald: Very soon is no response to the great number of women across the country who are awaiting and have been awaiting pension reform for years.


STATUS OF WOMEN
Flora Isabel MacDonald: Madam Speaker, I should like to ask the minister another question. It deals with the impact of the microtechnology revolution on the jobs of a million women, women who work in banks, in stores, as clerks and as stenographers, women who stand to lose their jobs in the next few years. Therefore retraining of these women must be on a priority basis. Since the new National Training Act has been in effect for some weeks, what new programs are ready to be introduced by September, by the beginning of the school year, in vocational and technical schools and in plants throughout the country, so that these women who stand to lose their jobs will obtain retraining on an urgent basis?


Judith A. Erola: Madam Speaker, I am sure the hon. member is aware that by September vocational and secondary schools, which are under the jurisdiction of the provinces, will have to see that proper courses are in place. One major obstacle to retraining programs-I have talked with a number of educators, and this fact is coming forward more and more through the task force which is going across the country headed by Dr. Margaret Fulton from Mount Saint Vincent University-is that those women who have not received proper training in high schools and universities are not in positions to take advantage of the training programs, and that training must begin at the elementary and secondary school levels.


Flora Isabel MacDonald: I am not sure whether the minister is aware of the act which the Minister of Employment and Immigration brought forward. It is called the National Training Act and is sponsored by the federal government.


REQUEST FOR PUBLIC INFORMATION PROGRAM
Flora Isabel MacDonald: Madam Speaker, I should like the minister to tell me whether or not, as part of the program which the federal government could introduce, there is anything in the way of a public information program to begin to inform women of the dangers that lie ahead of them in the employment field because of the
microtechnology revolution. At the present time the Governments of France and Japan have major public information programs designed to alert women to the impact which microtechnology will have on their jobs. Will anything of this nature be introduced by the federal government so that women will be aware of the need for retraining and begin to look to nontraditional roles and into training in the new technology?


Judith A. Erola: Madam Speaker, I do not know where the hon. member for Kingston and the Islands has been. That is exactly what this government has been doing for the past two years. We have a task force headed by Dr. Margaret Fulton, running across this country ascertaining the problems that exist. The hon. member knows that the federal government sponsored a seminar here just three weeks ago that was paid for by this government to examine the problems of microtechnology and how they impact upon women. She should be better informed.


HAZARDOUS SUBSTANCES
Mr. Geoff Scott (Hamilton-Wentworth):: Madam Speaker, my question is for the Minister of Consumer and Corporate Affairs. Has the report by the Hazardous Products Board of Review on UFFI been submitted in writing to the minister?


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: No, Madam Speaker.


REQUEST THAT REPORT BE TABLED BEFORE SUMMER RECESS
Geoffrey Douglas Scott: Madam Speaker, the minister told the National Advisory Council on UFFI on June 19-that is one month ago today-that he would have that report within two weeks. Will the minister table the report of the Board of Review before this House adjourns for the summer recess?


André Ouellet: Madam Speaker, it is true that 1 indicated to the National Advisory Council that I was hoping to get this report within two weeks. This was the indication that I had received, that the report was almost completed. Unfortunately one of the three members of the committee is seriously ill. In fact I told the members of the committee at that time that indeed the member was in hospital. Unfortunately, I understand that he has returned to hospital and has not been able to complete his part of the report. Therefore, we are all waiting for this report. We hope that the gentleman will recover quickly and be able to finish his report in the coming days.
July 19, 1982


FINANCE
Mr. Ian Deans (Hamilton Mountain):: Madam Speaker, my question is directed to the President of the Treasury Board. On "Question Period" the President of the Treasury Board said, "We must limit price increases." Does that apply to all government agencies and, in particular, does he believe it should apply to Canada Mortgage and Housing Corporation?


Hon. Donald J. Johnston (President of the Treasury Board):: Madam Speaker, I am sure the hon. member for Hamilton Mountain has his view on price increases which he has expressed a number of times. It seems to be in firm agreement with my remark. He will have to await the specific details of what the federal policy will be.


CANADA MORTGAGE AND HOUSING CORPORATION-INCREASES IN RENTS AND PRICES
Ian Deans: Madam Speaker, while I am waiting for the firm details of the government policy, perhaps the minister would be kind enough to tell us whether or not there will in fact be a government policy with regard to price increases, and whether he thinks that it is reasonable that accommodation, which accounts for about 30 per cent of the expenditures of the incomes of the majority of families, should be left free, as is the case of CMHC, to the point where increases in excess of 20 per cent on rents are now being approved, and where increases at the level of $2,000, $3,000 and $4,000 on top of the prices being charged prior to the budget are now being levied on homes being made available for sale by CMHC?


Donald James Johnston: Madam Speaker, it seems to me the hon. member is making the House aware of some news that has already been expressed. With respect to the policy, though, the issue of administered prices was specifically addressed in the budget speech of the Minister of Finance.


Ian Deans: Since the minister seems reluctant to explain to the House what he feels he should have explained to the public, it was the minister, not me, who said the price increases should be limited.


VANCOUVER MARKET RENT INCREASES
Ian Deans: Does the minister think it is appropriate to increase the rental costs to the merchants at Granville Island market in Vancouver by 200 per cent to 300 per cent during this period when the government, as it says, is working hard to try to bring the levels of wage increases down to the level of 6 per cent and 5 per cent?


Donald James Johnston: Madam Speaker, in his premise to this particular question the hon. member is saying that 1 would make something available to the public that I have not made available to
Oral Questions
the House. My recollection of the exchange in "Question Period" is that there were no specifics advanced with respect to any particular area, certainly not the issue of housing-


Ian Deans: Why are you saying that?


Donald James Johnston: -which he raises, and concerning which he now asks me for a personal view. The fact is that the issue of administered prices was addressed in the budget by the Minister of Finance as a general principle.


TRANSPORT
Mr. Pat Nowlan (Annapolis Valley-Hants):: Madam Speaker, I have a cluster type question to ask the Minister of Transport. When will the minister make up his mind, or at least announce his position with respect to Mirabel, the position with the Maislin Trucking Company, and when will we receive the working paper or the draft bill for VIA Rail?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, the question concerning Mirabel is before cabinet, as everyone knows. I believe that in a few days the announcements could be made. On Maislin, which is not my main responsibility, similarly; and on the VIA bill, I have already indicated that I was hoping to give it to the House of Commons Committee on Transport in the fall.


PRESENTATION OF PAPER ON VIA RAIL
John Patrick (Pat) Nowlan: In terms of VIA, when estimates were being considered by the transport committee the minister said that he hoped the working paper would be before the transport committee in May or June and that Mr. Giroux had it ready, or words to that effect. Will the fact that Mr. Giroux has now been appointed deputy minister of national revenue affect the presentation of the working paper for consideration and meditation over the summer, even before we see the draft bill?


Jean-Luc Pepin: No, Madam Speaker, the discussion paper is quite advanced, but I did not think it would be necessary to push officials to finalize it because the committee will not be studying it during the summer anyway. 1 thought we could take the extra time to complete it, polish it, and present it in a style which is worthy of the quality of the members of that committee.


CONSIDERATION OF MAISLIN CASE
Hon. Jake Epp (Provencher):: Madam Speaker, my supplementary question is directed to the Minister of Transport and it is with regard to the Maislin case. There is much concern in the Canadian Trucking Association involving a loan guarantee

July 19, 1982
Oral Questions
or a grant, whatever the form the government might see fit to decide in the Maislin situation, feeling that a precedent would be created in the trucking industry. With the $20 billion plus deficit the government is carrying this year, does the minister feel that the Canadian taxpayer can afford these bailouts?


Jean-Luc Pepin: Whatever feelings I have on that subject at this time are reserved for expression in the committee of cabinet which looks at this particular issue, but 1 want to reassure the hon. member that we are quite aware of the possibility that this could be presented as creating a precedent.


APPLICATION OF GOVERNMENT POLICY
Arthur Jacob (Jake) Epp: Madam Speaker, 1 would like to ask the minister one short, supplementary question. To the present time loan guarantees or so-called bailouts have generally been related either to the energy sector or the manufacturing sector. Should this step be taken with Maislin, the government, 1 would think, would then be strongly moved into the service sector as well. If the government bails out one section of the service sector, such as Maislin, will it use the same criteria for others who will come to the government with the same requests?


Jean-Luc Pepin: Madam Speaker, 1 am quite aware that up until now the regulations have applied only to manufacturing, and not to services. What 1 will say is only theoretical as we are discussing ideas now, not decisions; but should this be extended to the services it would be on the basis that services are quite as useful in society as manufacturing, and also provide much employment. Consequently, there might not be justification for treating services separately from manufacturing or resource development.


EXTERNAL AID
Ronald Alexander Stewart: Madam Speaker, in the absence of the Prime Minister and the Minister of Finance, I would like to direct my question to the President of the Treasury Board. Every Canadian knows that the problems and the economic woes of Canada are caused by government mismanagement, excessive spending, and so on. At no time was this more evident than a week ago Sunday when viewers of W-5 were informed of the profligate spending of C1DA involving a mismanaged project in Haiti. The minister will know that there were no specific acts of Parliament establishing Cl DA and that no authority has really been given to it. Its operations are legal only through the provisions of the Appropriations Act. Would the minister use his good offices to persuade the Prime Minister that, unlike VIA Rail, and unlike metric, this
matter will be debated in the House and a proper act will be forthcoming?


Donald James Johnston: Madam Speaker, I am not sure what specifically the hon. member wants to debate in this House. We have heard his views, which by and large have been very negative in terms of foreign aid programs, and which 1 suspect are not shared, frankly, by many other members of his party. If that is the issue he wants to debate in this House, then he might take the opportunity of putting forward a motion and have it debated. It would be interesting to see whether other members of his party share his view.
In terms of the specific Cl DA projects, we in the Treasury Board have been concerned with cost overruns or management issues in Cl DA projects, just as we are in all other projects. Ministers of the Board have taken an interest in a number of Cl DA projects which are subject to particular forces and particular difficulties, for a whole variety of reasons which I would not want to take up the time of the House at this point to explain. In any event, 1 would like to assure the hon. member that the management questions in Cl DA arc looked at on an ongoing basis by the Treasury Board.


ACCOUNTABILITY TO PARLIAMENT
Ronald Alexander Stewart: Madam Speaker, we are all interested in the humanitarian aspects of C1DA, but now that we have a Freedom of Information Act I would like to ask the President of the Treasury Board if he will stop the practice of $1 votes which has led to such slipshod mismanagement and the support of such dubious projects with immunity from parliamentary scrutiny, and will he move quickly to bring CIDA's financial operations in line with the accepted norms of estimates, with accountability to Parliament and the people of Canada?


Donald James Johnston: Madam Speaker, nothing is of greater concern to members on this side of the House than improved accountability and improved management of all aspects of the Public Service, including Cl DA. It seems to me we have taken very important initiatives in that regard including, for example, the new form of estimates which perhaps the hon. member has had the occasion to examine. I do not recall receiving any comments from him, but I would be happy to receive representations if he feels that they are in any way inadequate or not satisfactory in terms of the information he requires with respect to C1DA programs or other programs.
On the subject of $1 votes, Madam Speaker, we have been scrupulous in observing the ruling which you yourself handed down last year in the preparation of the main estimates and in the preparation of supplementary estimates since that time.
July 19, 1982


UNEMPLOYMENT INSURANCE
Douglas Grinslade Lewis: Madam Speaker, my question is directed to the Secretary of State for Finance in the absence of the Minister of Finance. In the budget papers which were released on June 28, the Minister of Finance estimated a deficit in the unemployment insurance account of $2.2 billion. In the "Budget in Brief', distributed on Friday, there are figures which indicate that the deficit will actually be $3.1 billion. Which figure is correct?


Hon. Pierre Bussieres (Minister of State (Finance)):: Madam Speaker, I will check both documents. I have not seen the document "Budget in Brief' referred to by the hon. member. I will check both documents and also the figures, and I will let the hon. member know which amount is correct. If I am not mistaken, the official figure in the budget documents was $2.2 billion.


QUERY RESPECTING POSSIBLE INCREASE IN INSURANCE PREMIUMS
Douglas Grinslade Lewis: Madam Speaker, the figures I referred to in the "Budget in Brief' are on page 10. As I read it, those are the only figures which are different from the original budget figures. In view of this serious shortfall of revenue, is the government considering an increase in unemployment insurance premiums on January 1 and, if so, how much?


Pierre Bussières: Madam Speaker, the hon. member may recall that the Unemployment Insurance Act provides for a mechanism whereby premiums are automatically adjusted annually, in relation to the amounts drawn on the Unemployment Insurance Fund, and every year, cabinet must review the level at which premiums are to be set. This exercice will take place this year as well, but right now 1 am not in a position to inform the hon. member what the amount of the premium will be.


CANADIAN DAIRY COMMISSION
Mr. Stan J. Hovdebo (Prince Albert):: Madam Speaker, on Friday the Minister of Agriculture responded to the very serious problems revealed by the Auditor General's comprehensive audit of the Canadian Dairy Commission by stating that he had asked the RCMP to investigate the Commission's marketing practices. I would like to know why the minister has delayed taking action for such a long time, and why he has not removed the persons responsible for these unacceptable practices from the Commission? Or is criminal investigation,
Oral Questions
followed by trial and sentencing, the only way these people can lose their jobs? Specifically, will the minister ask for the resignation of the Chief Commissioner, as our party suggested he do last January 7?


Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, the hon. member knows full well, if he has read the Auditor General's report, that what he says is not right. The Auditor General really makes no accusations in the report. Fie suggests some things, and it is my duty to make sure those things are proven one way or another. Until someone is proven guilty, they should not be condemned or fired as the hon. member is suggesting. That is the procedure I am following, on legal advice. The inquiry will go on, and if there is any wrongdoing then those who are guilty should be penalized.


Stanley J. Hovdebo: Meanwhile, Madam Speaker, many millions of taxpayers' dollars go by the board.


REQUEST FOR FULL-SCALE INVESTIGATION
Stanley J. Hovdebo: Madam Speaker, I would like to follow along on that answer and look into the minister's own handling of this situation. The Auditor General completed his report in March, or shortly afterwards. The Commission was permitted to respond in April. The RCMP investigation was announced two and a half months later. Why did it take two and a half months for the minister to change his mind when the Auditor General's report put forward the reasons for criminal charges much earlier, and will the minister guarantee to this House right now that any RCMP investigation will include all activities of the CDC, not just marketing practices?


Eugene Whelan: Madam Speaker, the hon. member makes great sweeping statements about the Dairy Commission. I would challenge him to point out where the wrongdoings are suggested in that report on the Commission. I would ask him to make it clear where those charges are made by the Auditor General. 1 asked the Auditor General to do an intensive report on the Dairy Commission, and 1 received it in late May. If you will notice, there is no suggestion in that report about an RCMP investigation or anything. I asked for that myself quite some weeks ago. I do not know how far the investigation has progressed, but it has been under way for some time, not just since the report was tabled in the House.
I say the Dairy Commission is very well run when we compare it to nearly any other organization, and I will stand behind the Commission until 1 am proven wrong. We have depended on the Auditor General's report in the past, and the Commission is challenging some of the statements in the report and are asking for an independent auditor to come in and make a survey of his report and the Dairy Commission's operations because they are sure they are not operating as badly as the hon. member for Prince Albert has said they are

July 19, 1982
Oral Questions
operating. 1 am not, nor do I think anyone wants me to be, the kind of person to condemn someone on the kind of suggestion that the hon. member is making, saying that there is a waste of millions of dollars. That has not been proven, and the Auditor General's report does not say that either.


INDIAN AFFAIRS
Frederick John King: Madam Speaker,
1 would like to ask the Minister of Justice if he has read the fifth report of the Standing Committee on Indian Affairs and Northern Development, together with the minutes of the committee which led up to the recommendation for an independent inquiry into certain aspects of the B.C. regional office activities. Is the Minister of Justice concerned with the type of limited internal review which was announced on Friday, when it is considered that both the standing committee and officials of the Department of Indian Affairs and Northern Development consider that a full and independent inquiry is necessary?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, this is a problem that comes under the jurisdiction of my colleague, the Minister of Indian Affairs and Northern Development. The minister did not ask my opinion on this matter, and I did not examine the report. I know that legal advisers from my department work at the Department of Indian Affairs and Northern Development, but no report on the matter has reached my office.


PRE-REVIEW RECOMMENDATIONS
Frederick John King: Madam Speaker, can the Minister of Justice inform me whether he has made recommendations to the Minister of Indian Affairs and Northern Development to institute the very limited internal review which was announced on Friday, and which many may consider to be a cover-up? I ask that question in light of a recommendation which came from an official of the department suggesting that perhaps the RCMP should be involved.


Joseph Jacques Jean Chrétien: Madam Speaker, a decision was made by the Minister of Indian Affairs and Northern Development to have an internal inquiry. If something is found, we will act accordingly. However, there is no need at this moment to have an inquiry other than the one decided by the minister.


ROLE OF DEPARTMENT OF JUSTICE
Right Hon. Joe Clark (Leader of the Opposition):: Madam Speaker, was the Minister of Justice consulted by the Department of Indian Affairs and Northern Development before the Department of Indian Affairs and Northern Development took the decision to reject the unanimous report of the standing committee and opt for an internal inquiry? Was the minister's department consulted?


Joseph Jacques Jean Chrétien: Madam Speaker, I cannot say whether my department was directly consulted. I know that some Department of Justice lawyers do work for the Department of Indian Affairs and Northern Development. I cannot say whether they were consulted. I will inform myself and advise the House.


POSITION OF PRIME MINISTER
Charles Joseph Clark: Madam Speaker, we have an undertaking from the Minister of Justice to report to the House as to whether there had been a legal opinion given by government lawyers before the decision taken by the Minister of Indian Affairs and Northern Development. Will the Acting Prime Minister personally, or request that the Prime Minister personally interest himself in this question which is of extraordinary importance, because the government has acted against the considered recommendation of a unanimous committee of this House of Commons regarding the need for a public inquiry?
Instead of following Parliament's advice for a public inquiry, the ministry has chosen a private inquiry. Will the Acting Prime Minister give an undertaking that there will be a report to this House by the Prime Minister as to whether the Prime Minister is personally satisfied that it was appropriate for this matter to be handled by a private rather than a public inquiry?


Jean-Luc Pepin: Madam Speaker, I just heard with my own ears the Minister of Justice saying that he was going to do this himself. He is fully grown, intelligent, able, and has a good relationship with the Prime Minister. I am quite sure he can do it on his own. The House and the public are witness to the commitment which he made to the Leader of the Opposition a moment ago.


QUERY RESPECTING POSSIBLE INVOLVEMENT OF ROYAL CANADIAN MOUNTED POLICE IN INQUIRY
Charles Joseph Clark: Madam Speaker, the minister has spent a good part of his life evading questions. He knows that the only undertaking given by the Minister of Justice was the undertaking to report as to whether legal officers had been consulted. I am asking whether the highest level of government, the Prime Minister, approved a private, secret inquiry, against the recommendation of the standing committee for a public inquiry. I would like a report on that at a later time. The minister can take it as notice. Will
July 19, 1982

the Acting Prime Minister or the Minister of Justice tell me whether the RCMP was involved in any aspect of the case under consideration by the private inquiry within Indian Affairs?


Joseph Jacques Jean Chrétien: Madam Speaker, 1 have nothing further to add to the answer I just gave. In any case, the RCMP is not the responsibility of the Minister of Justice but that of the Solicitor General.


INQUIRY RESPECTING POSSIBLE ROLE OF ROYAL CANADIAN MOUNTED POLICE
Charles Joseph Clark: Madam Speaker, let me ask the Solicitor General whether the Royal Canadian Mounted Police are involved in any way whatsoever in any aspect of the matters under investigation by the Department of Indian Affairs and Northern Development, the matters referred to by the Standing Committee on Indian Affairs and Northern Development, and by my colleague from Okanagan-Similkameen.


Hon. Bob Kaplan (Solicitor General):: Madam Speaker, I cannot answer that question. The RCMP does not consult the government about investigations and does not take direction from the government about investigations. It does not require terms of reference for investigations. Its terms of reference are the Criminal Code and other federal statutes. It operates under a tradition of independence which I consider it my mandate to preserve.


NATIONAL DEFENCE
Hon. Allan B. McKinnon (Victoria):: Madam Speaker, my question is for the Minister of National Defence. The June budget mentioned that indexation of the pensions paid to public servants will be limited to 6 per cent. Can the minister tell us if the 6 per cent maximum will apply in a retroactive fashion to retired servicemen who have not yet qualified for indexation under the 85 rule but who will, of course, qualify at some later date?


Hon. J. Gilles Lamontagne (Minister of National Defence):: Madam Speaker, the question asked by the hon. member for Victoria is a complex one. 1 carefully read his speech in the House last Thursday on the same subject. He has made a point which has to be evaluated. 1 would point out, however, that the funds in the pension fund are not only from the employees. For example, in the pension fund of the defence department, the defence department supplied over $247 million in contributions to the fund this year. However, if we want to reduce the pension indexation factor to 6 per cent at a certain point, in
Oral Questions
order for this government to bring inflation down to 6 per cent,
1 think it will be successful. In a couple of years 1 do not think any employee of the department will lose anything if we have 6 per cent inflation, and their pensions are indexed at 6 per cent.


Allan Bruce McKinnon: Madam Speaker, sometimes in the past the minister has missed my question by quite a bit, but that exceeded the limit.


QUERY RESPECTING INTRODUCTION OF LEGISLATION
Allan Bruce McKinnon: Madam Speaker, obviously the statement in the budget about capping indexation is going to require that a bill be introduced in the House. Perhaps the minister or the House leader can tell me when it is their intention to bring such a bill into the House. If it is not for quite some time, will the government tell us its interpretation of the indexation catch-up which is part of the 85 rule?


J. Gilles Lamontagne: Madam Speaker, sometimes the hon. member for Victoria could be more clear in his questions or give me notice when a question is too complex to answer in the House. Otherwise, I suggest he place his questions on the Order Paper and we can answer them. This matter can be discussed with the House leader as far as the bill is concerned, or with the President of the Treasury Board with regard to the time mechanism, whatever is decided.


AGRICULTURE
Hon. Don Mazankowski (Vegreville):: Madam Speaker, 1 would like to direct my question to the Minister of Agriculture. During the last election campaign the minister promised he would keep farm production prices down and that he would establish a special fuel price structure which would be exempt from federal taxes. Since the minister has resumed his duties as Minister of Agriculture, he has presided during a period of time in which interest rates have almost doubled, fuel prices have doubled, and fertilizer and pesticide prices have increased by 30 per cent. He is now a member of a government that is proposing a 45 per cent increase in the freight rate on grain-


An hon. Member:: Ask the question.


Donald Frank Mazankowski: I will ask the question. I simply ask the minister whether he is satisfied that he has honestly fulfilled his election promise. If not, what action is he taking or contemplating to ensure that that pledge will be fulfilled for the farmers of Canada?


Eugene Whelan: Madam Speaker, I do not know what research the hon. member is using for all those statements that I made, because if he is reading speeches 1 gave during the election campaign, those were not prepared.

July 19, 1982
Oral Questions


Some hon. Members:: Oh, oh!


Eugene Whelan: They were made in the heat of debate, you could almost say off the cuff, but there isn't any cuff there!


Flora Isabel MacDonald: What is on your shoes?


Eugene Whelan: The record clearly shows that my record is as good as the hon. member's in fulfilling promises made during the heat of an election campaign.
I would compare the production costs my farmers in Canada pay with those paid by any farmers in any part of the world with whom Canadian farmers compete. I ask the hon. member to be fair and recognize that the cost of production of food in Canada is, if not as reasonable, more reasonable than the cost in any other part of the world.


Some hon. Members:: Hear, hear!


CAPITAL GAINS TAXES
Donald Frank Mazankowski: Madam Speaker, I wonder if the minister would permit me to remind him of another election promise he made in the same speech in Alvinston, Ontario, on January 31, 1980. He said:
Inequities in income tax legislation regarding farmer capital gains taxes will be removed-
He went on to say he would provide the option to farmers of a valuation day of either December 31, 1971, or December 31, 1974, whichever was the greater. He also said his party:
-would also give farmers a once-in-a-lifetime capital gains exemption.
How is the Minister of Agriculture coming along with the fulfilment of those promises?


Eugene Whelan: Madam Speaker, as humbly as I can say it, slowly. If we check the budget of November 12 and the budget of June 28, we will see that we have made some terrific gains.


Some hon. Members:: Oh, oh!


Eugene Whelan: We are not giving up yet, in any sense. The committee which has been appointed by the Minister of Finance will be looking at this very matter. I would hope such a learned person as the hon. member who asked the question would make a presentation to that committee on just what he thinks should be done. We hear all kinds of opinions on what should be done and what should not be done. Let the hon. member or any of his learned colleagues make a presentation. There are some very brilliant people on the other side of the House. Perhaps they should make suggestions. It would be the first time they made suggestions to overcome some of the difficulties they are talking about. I have been listening and waiting for them to make suggestions, but they have been very slow to make any.


SHIPBUILDING
Mr. Ray Skelly (Comox-Powell River):: Madam Speaker, the issue I would like to raise with the Minister of Transport probably does not require the responses of a stand-up comic.
My question deals basically with the announcement the other day that Dome Petroleum has received approval from the B.C. government on the Rim gas project. In the past it was intended that four LNG carriers would be built, two in Canada and two in Japan. Now the announcement is that there will be no shipyard on the west coast of Canada and that five LNG carriers will in all probability be built in Japan.
Federal Commerce and Navigation has built four bulk coal carriers offshore for the northeast Coal project. Two drydocks, one for Dome and one for Burrard, have been built in Japan. A stacker-reclaimer for the coal port was built in Japan. CP Ships has reregistered 23 vessels, half in Hong Kong and half in Britain, instead of in Canada. The government has consistently failed to tie our trade relationship to the UNCTAD convention which would provide that 40 per cent of our exported and imported goods would move in Canadian hulls. Several months ago the Prime Minister gave a commitment-


Madam Speaker:: Order. Does the hon. member really have a question, or is he simply making a speech?


Raymond John Skelly: Madam Speaker, I will move quickly to it. In aid of explaining where the hundreds of thousands of Canadian jobs have gone, would the Minister of Transport explain whether the government has made any progress in considering the creation of a ministry of state for marine transportation which would implement a marine industrial strategy which would gain for Canadians some of the hundreds of thousands of jobs we are currently giving away?


Jean-Luc Pepin: Madam Speaker, there were at least seven questions in the hon. member's introduction. On the question of creating a marine section in Transport Canada with, presumably, a politician responsible for it in the House, I presume this is one of the questions the Prime Minister always has in mind. If he decides to do this, we will be informed of it. The previous government had such a minister in charge of the marine aspect of the Department of Transport. It is a precedent which exists, and might be repeated, but this is a matter for the Prime Minister.


Raymond John Skelly: Madam Speaker, 1 must apologize for the preamble being so lengthy. There was only one question. Thirteen major vessels and hundreds of thousands of jobs have been given away. That is where the minister was confused.


SPIN-OFF BENEFITS FOR CANADIAN COMPANIES
Raymond John Skelly: Madam Speaker, I would like to ask the minister a second question. The fire sale

July 19, 1982
of Canadian resources in the petroleum, base metals, forest products and coal sectors has resulted in a problem. Dome Petroleum, which turned off those drydocks, those vessels, those LNG carriers and probably the four carriers to be developed for the Arctic pilot project, is deeply indebted to the Japanese. Because of that indebtedness with respect to financing, would the Minister of Transport agree that it would be very difficult for Canadians to trust this company any further to capture for Canadians the industrial spin-offs which would come from the shipbuilding and allied trades, and would it not make sense for the government to intervene in these contracts to ensure that the spin-offs do accrue to Canadians?


Hon. Marc Lalonde (Minister of Energy, Mines and Resources):: Madam Speaker, that is why last year, in spite of NDP opposition, we passed the Canada Oil and Gas Act, which includes a very strong clause to ensure Canadian benefits in terms of goods and services. We had to fight for this clause against the opposition of members of the New Democratic Party. We finally got it in, and now we are establishing agreements with the various companies operating in the oil and gas field in order to ensure the maximum Canadian benefits in terms of goods and services. This is producing results at the present time.
The point raised by the hon. member is exactly the point in question. The proposal Dome has put forward and which has been recommended by the Government of British Columbia still has to be approved by the Government of Canada. I have discussed this issue with Dome representatives-and with Japanese representatives when they came here recently-and stressed the importance we attach to Canadian benefits resulting from those sales. That is what this government is doing consistently, thanks to the legislation we presented to Parliament and passed, despite the opposition of the NDP.


AGRICULTURE
Mr. Gus Mitges (Grey-Simcoe):: Madam Speaker, my question is directed to the Minister of Agriculture. As the minister is probably aware, the Canadian National Livestock Records Committee is hoping to computerize its operation, which would give it a complete linkage with the record of performance programs, agricultural fairs and exhibitions. This would have the effect of making all information more readily and more accurately available to the whole livestock industry. I would like to ask the minister if he supports such a worthwhile program and, if so, would he consider giving some assistance, technical or otherwise, to get this program off the ground?


Eugene Whelan: Madam Speaker, I am very much aware of the program. I met with the manager, or director, of livestock records for Canada and went
Petitions
over the program very quickly with him last week. If we can assist with funding, we will.


NATIONAL ENERGY PROGRAM
Mr. Jack Shields (Athabasca):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. It is now recognized that the national energy policy has caused an outflow of investment capital at an unprecedented rate. This has caused a massive drain on the Canadian dollar, resulting in astronomically high interest rates, business recession across the country, and unemployment at an all-time high. Canada is now not considered by the investment community of the world as a safe place to invest.


Mr. Peterson:: Nonsense.


Jack Wendele Shields: When will the minister do something to reverse this situation and make Canada a safe place to invest?


Marc Lalonde: Madam Speaker, I am afraid there is little I can do about the hon. member's personal nightmares.


Jack Wendele Shields: Madam Speaker, I would not expect much more from the minister.


DEVELOPMENT OF OIL SANDS IN NORTHEASTERN ALBERTA
Jack Wendele Shields: Madam Speaker, it is generally accepted that the reserves in the oil sands in northeastern Alberta exceed the known reserves in the Middle East. Is the minister or anyone in his department working toward developing the oil sands in northeastern Alberta?


Marc Lalonde: Yes, Madam Speaker.


PETITIONS
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the table the three hundred and eighth report of the Clerk of Petitions stating that he has examined the petition presented by the hon. member for Bow River (Mr. Taylor) on Friday, July 16, 1982, and that he finds that it meets the requirements of the Standing Orders as to form.

July 19, 1982
Order Paper Questions



ROUTINE PROCEEDINGS

[Stage Direction]
[ Translation]

[Stage Direction]
presentation of seventh report of standing committee
Mrs. Eva Cote (Rimouski-Temiscouata):: Madam Speaker, 1 have the honour to present the seventh report of the Standing Committee on Agriculture, in both official languages.
[Editor's Note: For above report, see today's Votes and Proceedings.]


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 4,162, 4,306, 4,327 and 4,360.


Mr. Robinson (Burnaby): L What arc the sources of authority for the RCMP's security intelligence mandate?
2. Did the government ever issue guidelines to the RCMP as to how the cabinet directive of March 27, 1975 should be interpreted?


Robert Phillip Kaplan: 1. Section 44(e) of RCMP regulations and orders, made pursuant to the Royal Canadian Mounted Police Act, specifies that in addition to the duties prescribed in the act, "it is the duty of the Force to maintain and operate such security and intelligence services as may be required by the Minister". The government has provided explicit direction with respect to the investigative services to be provided by the RCMP in support of the personnel security clearance programs of departments and agencies as required under the terms of Cabinet Directive 35. The RCMP may also engage in broader security intelligence investigative activity on the basis of direction provided by the cabinet on March 27, 1975.
2. No.


Mr. Robinson (Burnaby): 1.	Did page 1,012 of the second report, volume 2 of the McDonald Commission state that the English and French versions of Section 5 of the RCMP Act differ, causing an ambiguity in the meaning of this section?
2.	Did the Solicitor General instruct his department to consider those remarks as it draws up a legislative response to the recommendations of the commission?


Robert Phillip Kaplan: 1. At page 1012 of the second report of the McDonald Commission, it is stated that "-section 5 of the RCMP Act is open to two interpretations". It is suggested that the English version is ambiguous while the French version is not. At page 1013 the following appears: "We think that the statute should be amended to effectuate the recommendations which we will be proposing, and such amendments would, we believe, eliminate any existing ambiguity."
2. The remarks on pages 1012 and 1013 of the second report of the McDonald Commission relating to ambiguities in respect of the French and English language versions of section 5 of the RCMP Act are being considered by officials of the Ministry of the Solicitor General within the framework of a general review of the recommendations of the McDonald Commission.


Mr. Gurbin: Is there any encouragement for individual Canadians or Canadian companies to develop mini-cars similar to the mini-cars now being produced by the Japanese and which will be available on the Canadian market in the near future?


Hon. Herb Gray (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: In so
far as the Department of Industry, Trade and Commerce is concerned: Canadians and Canadian companies have come forward with ideas for small mini-cars similar to those being produced by the Japanese.
These ideas have been encouraged and the federal government, both in Industry, Trade and Commerce and Transport Canada, have worked with people involved to foster the ideas and endeavoured to obtain support from the private sector in order that a viable opportunity can be presented and be eligible for financial support from the government. No viable proposition has yet been received but continued encouragement will be given to any Canadian with a good feasible idea.


Mr. Herbert: With reference to the answer to question No. 4,240. what were the reasons given by the health ministries of British Columbia and Quebec for non-participation with the government in the funding of the development of managment information systems for health institutions?


Mr. Doug Frith (Parliamentary Secretary to Minister of National Health and Welfare):: The British Columbia Ministry of Health already had a similar study underway in co-operation with the British Columbia Hospital Association, but will be providing its findings, reports and manuals as its contribution to the national project.
The Quebec Department of Social Affairs has already developed an adequate information system suitable to its purposes, such that a new management information system was not an urgent priority in a period of severe financial restraint.
July 19, 1982


David P. Smith: 1 ask, Madam Speaker, that the remaining questions be allowed to stand.


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered.


Arnold John Malone: Madam Speaker, from time to time Members of Parliament rise in their places to ask why a certain question has not been answered. I have had a question answered after nearly two years on the Order Paper. 1 find out, however, that the question is really still not answered. Like Eliza Doolittle in "My Fair Lady", all I have is words, words, words. The answer has no bearing on question No. 3,370. I should like an explanation why, after waiting two years for an answer, the response makes virtually no sense at all.


David P. Smith: Madam Speaker, I do not recall the specific question that my hon. friend refers to. I suggest that he should place another question on the Order Paper seeking clarification of the points he felt were not dealt with. I will do my best to get him an answer as soon as possible.


Madam Speaker:: Shall the remaining questions stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


Pierre Bussières: that Bill C-125, to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, before outlining the main aspects of Bill C-125 which requires additional borrowing authority for the current year, 1 should like to take advantage of this opportunity to elaborate on the government's financial requirements as they appear in the context of the last budget.
Many people were surprised at the size of the deficit we forecast in the last budget. At this time I should like to dispel a number of concerns that have been made known to us in this regard. 1 am also anxious to correct a misinterpretation that has been spread about following the announcement of these forecasts, that the government extended its programs in a period when austerity is essential.
I believe it is important that Canadians get a true picture of the facts in this matter and that they realize that the government has allotted itself just one additional discretionary expenditure since the November budget. This was the sum of
Supplementary Borrowing Authority
$400 million allotted to direct job creation and the extension of variable entrance requirements for unemployment insurance benefits.
In view of the present circumstances, I believe that Members of Parliament will agree with me that this is not an extravagant expenditure. The government chose to maintain a reasonable attitude by calling for solidarity and sharing by all Canadians in order to be able to provide some assistance to the unemployed, home owners and businesses in difficulty. The government is calling for moderation and discipline to steer the economy back to recovery so that soon everyone can benefit from the growth in permanent jobs and the improvement in real incomes.
Then why has the government's deficit grown to such alarming proportions? The answer is relatively simple. The deficit of some $10 billion forecast in the November budget was based on the expectation that the economy would slow down somewhat. Growth expressed in real terms was expected to drop from 3.6 per cent for 1981 to only 2.2 per cent for 1982. However, the slowing in economic activity was far more serious than expected and, in this respect, the government's forecasts were no different from those made by private organizations or other public institutions. We are now expecting a definite decline in economic activity or, in other words, a negative growth rate of 2 per cent. In plain language, everyone guessed wrong, including the government. The extent of the recession has considerably aggravated the financial situation facing the government. The decline in production, employment and income, all of which is due to the recession, has resulted in a loss of revenue for the government of about $4.5 billion. A drop in international oil prices and the reduction in certain energy-related taxes announced recently in the National Energy Program Update have cut an additional $1.6 billion from the budgetary revenues forecast.
Finally, adjustments to the November budget measures also reduced estimated revenues by about $300 million. Thus, because of a weakening in the economy, we have a $6.4 billion decline in revenue.
The recession has also had a major impact on government expenditures. High interest rates have increased public debt charges by $1.1 billion. Energy-related expenditures, which were carried forward from last year, added another $1.1 billion to expenditures for the present fiscal year. Furthermore, the total outlays target was increased by about $300 million to accommodate a number of employment-related initiatives and by another $160 million to allow for the impact on fiscal transfers to the provinces. These and some other minor upward

July 19, 1982
Supplementary Borrowing Authority
adjustments to the outlays target were partially offset by reductions of $280 million in planned spending within the Energy envelope following the National Energy Program Update. The net effect of all these factors is to increase total outlays by $2.6 billion over the November budgetary forecasts.
Mr. Speaker, the $2.6 billion increase in projected expenditures plus the $6.4 billion decline in government revenues add up to a total of $9 billion, and that is why the $10.5 billion deficit forecast in November has had to be revised upward to $19.5 billion. This, in turn, means a substantial increase in the government's financial requirements, which have risen from $6.6 billion to $17.1 billion. One of the main components of the increase in financial requirements is the roughly $2 billion increase in unemployment insurance payments. Mr. Speaker, 1 believe that, in the light of this information, Canadians will understand that the increase in the government's deficit or its expenditures is in no way due to a voluntary act or lack of control by the government. In fact, I indicated that the $2.6 billion increase in expenditures was to cover areas that are of vital importance in view of the present recession. The projected increase in the government's deficit and financial requirements in relation to previous forecasts reflects, as I explained before, the automatic response of revenues, the unemployment insurance program and public debt charges to the acute recession we are experiencing today. Considering the size of our economy, this deficit does not constitute a precedent, compared with the deficits our own country and even foreign countries have known in the past ten years during periods of cyclical weakness.
More specifically, if we compare the Canadian deficit with that in the United States, Germany and Japan for this year and last year, we see that the Canadian situation is not much different from the situation in those countries. In fact, expressed in percentages of the GNP, we find that for Canada it was 1.2 per cent in 1981 and will be 4.4 per cent in 1982. In the United States, it was 0.9 per cent in 1981 and will be 3.5 per cent this year; in Germany, it was 4.5 per cent and will be 3.8 per cent this year. In Japan, it was 4 per cent in 1981 and will be 3.4 per cent this year. If we compare the government's present financial situation to the situation during the far less severe recession in 1978-79, we find that the government's financial requirements for both years are exactly the same, namely 4.8 per cent, expressed in percentage of the GNP. As for the budgetary deficit, it was 5.3 per cent of the GNP in 1978-79 and is now expected to be 5.4 per cent. If we compare our financial requirements for the current year with those in the United States, we see that their requirements are not much lower than ours, namely a little less than 4 per cent of the GNP, compared with 4.8 per cent in our own country. Finally, if we make comparisons on the basis of national accounts, we find that the Canadian deficit is only slightly higher than in the U.S., namely, 5.2 per cent of the GNP, compared with 4.8 per cent. Incidentally, when comparing deficits, we must also take into account the relative capacity of each government for
financing its deficit. In Canada, for instance, the personal savings rate is generally higher than in the United States.
In 1981, for instance, the savings rate was as high as 12.4 per cent of disposable income in our country, while it was only 5.3 per cent in the United States. This means that the Canadian government's ability to finance the deficit is greater, percentagewise, than it is in the United States. In fact, in financing a deficit which proportionally-and 1 stress the word proportionally, so as to spare the Leader of the Official Opposition (Mr. Clark) further astonishment-would be the same as in the United States, Canada would have more savings available for private investment because of the very substantial difference in savings rates between the two countries. During the first quarter of this year, the personal savings rate in Canada rose to its highest level ever, namely 13.3 per cent. Although our deficit is substantial, there is a considerable body of savings in Canada today, waiting to be invested in our economy.
Mr. Speaker, the government is still convinced that a substantial reduction in the deficit would merely aggravate our economy's present cyclical weakness. In its last budget brought down on June 28, the government was determined not to add to the deficit and it has achieved this goal. The government was also determined to find ways of creating jobs and sustaining economic activity, without adding further to the projected deficit. That goal has also been achieved. By reallocating expenditures and through tax changes, we have been able to provide $2.3 billion for reducing unemployment and helping sectors that have been severely affected by the recession and by high interest rates. We have been able to achieve these seemingly contradictory goals by applying the principles of solidarity and willingness to share and we have appealed to Canadians to reciprocate in kind. We have asked them to give up certain benefits to help the unemployed and to help troubled sectors of our economy.
That being said, Mr. Speaker, I wish to assure the House that the government remains committed to its policy of reducing the deficit in the medium and long term. Financial requirements have gone from 4 per cent of the GNP in 197980 to 2.5 per cent of the GNP in 1981-82. Mr. Speaker, I want Canadians to realize that the same forces that are instrumental in bringing about a cyclical increase in the deficit are also instrumental in reducing the deficit when the economy starts its recovery. As soon as the government's appeal for moderation and discipline with respect to wage demands and other inflationary expectations has been heard, prices as well as interest rates will finally go down. Economic growth will start up again, businesses will be able to make reasonable profits, investor confidence will return and production will increase. Workers who are now laid off will be hired again, and new jobs will be available to young Canadians graduating from our colleges and universities. Government expenditures to support the sectors most severely affected at the present time will no
July 19, 1982

longer be necessary, and as the employment rate goes up, unemployment insurance payments will go down. More jobs will mean more people who are able to pay taxes, and businesses that are thriving again will also increase the government's tax revenues. The present increase in the deficit as a result of the recession will also be automatically absorbed as the economy recovers.
Automatic stabilizers are necessary to sustain income and employment in a recession. They must be allowed to operate to avoid making the recession worse. Mr. Speaker, 1 am sure Canadians can clearly imagine what the consequences would be if a government refused to take its responsibilities in this extremely difficult period and decided to cut unemployment insurance benefits or slash expenditures that provide income for Canadians until the economic situation improved. As I said before, the government's requirements for the current fiscal year will be much higher than expected. As indicated in the June 28 budget, we shall have to borrow $17.1 billion during the current year. Since April 1, the government has already borrowed $3.5 billion, which it was able to do pursuant to borrowing authority granted in the course of previous fiscal years and still unused. However, the balance of the unused borrowing authority will automatically expire as soon as the bill is passed. We have already obtained borrowing authority for $6.6 billion under Bill C- 111 which received royal assent on June 17, 1982. The loan of $3.5 billion plus the $6.6 billion already approved by Parliament add up to a possible total borrowing authority of $10.1 billion, while the government's financial requirements, as I said before, are $17.1 billion. Therefore, a new borrowing authority for $7 billion will be necessary to meet the government's new financial needs. Bill C-125 now before the House is proposing to add an additional borrowing authority of $4 billion to the supplementary $7 billion, in order to provide sufficient room for manoeuvre in coping with contingencies. Mr. Speaker, 1 therefore move that Parliament adopt a new borrowing authority for $11 billion.
Generally speaking, the government requires some room to manoeuvre, over and above the projected financial requirements, in order to deal with any unexpected cash requirements. These may arise as a result of government exchange transactions. In past years, additional borrowing authority of this kind has remained at about $3 billion. Under Bill C-125, the government is seeking borrowing authority for up to $11 billion, $4 billion of which, as I said before, will be a contingency fund, which, if it has not been used by the end of the fiscal year, will be carried over to the following year. Again, all unused borrowing authority carried over from previous years will expire as soon as Parliament has passed the present bill. The bill contains a provision dealing with the government's authority to contract and reimburse loans in foreign currency, a purely technical provision which, Mr. Speaker, has been included in previous borrowing authority bills during the last
Supplementary Borrowing Authority
three or four years. Over the years, Canada has contracted loans and made settlements in many different currencies. Recently, however, this provision was added to confirm the right and authority of the Government of Canada to contract loans in foreign currency. Hon. members will recall that there is before the House a bill aimed at amending certain parts of the Financial Administration Act. The bill in question contains a provision in Clause 39.1 as a result of which, in the future, it will no longer be necessary to repeat this provision in borrowing authority bills.
As of April 1 of this year, we had borrowing authority for $3.6 billion under authority granted in the course of previous fiscal years, and as yet unused. When Bill C- 111 was passed on June 17 of this year, that gave us an additional borrowing authority for $6.6 billion, bringing our total borrowing authority up to $10.2 billion. Between April 1 and June 30, we used $4.6 billion of that amount, leaving us with borrowing authority for $5.6 billion. 1 shall indicate briefly how the borrowing authority for the $4.6 billion was used. We first financed about $600 million on domestic markets. The remaining $4 billion was financed on foreign markets, that is, $3 billion was obtained by using standby credit while another $1 billion was raised through a European bond issue last June.
In the course of the year, government transactions on the exchange market brought about a substantial increase in the government's cash balance which is about $3 billion at the present time. However, the government needs these funds in order to cope with the present instability and uncertainty on the exchange markets, and therefore cannot use them to finance the country's cash requirements at the present time.
Mr. Speaker, I shall now explain why the government wishes to obtain supplementary borrowing authority at this particular time of the year. First of all, we want to give hon. members an opportunity to consider a request for additional borrowing authority in the light of financial projections which were updated and submitted in the November budget by the Minister of Finance (Mr. MacEachen). We also want to have the greatest possible flexibility in planning the debt program, so as to take advantage of market opportunities as they occur and thus maximize utilization of the various sources of financing available to the government, obtaining them at the best possible rate for the benefit of Canadians. The government finances its requirements through three main sources: marketable bonds, Treasury bills and Canada Savings Bonds. For proper planning of its borrowing authority and debt program, the government must have the flexibility to use the tools at its disposal to achieve the best possible balance of financing instruments. For instance, I must point out that the annual savings bonds campaign requires lengthy preparations and accounts for a significant share of the borrowing authority. Hon. members know that the interest rates of those bonds are set for the first year and so those issues are considered as a source of short-term capital. When the interest rates are high,

July 19, 1982
Supplementary Borrowing Authority
the yield of those bonds is an enticement for the public, but the government can benefit from the expected lower interest rates in the following years when the new rates are announced. If the government did not have the appropriate borrowing authority long enough before the bonds are issued, it would be unable to make the necessary publicity campaign, with the result that undue pressure would be brought to bear on other financing methods such as negotiable bonds and treasury bonds, which in turn might increase even more the cost of servicing the public debt. Mr. Speaker, hon. members realize that the government's borrowing program will be rather heavy in the coming months. 1 might point out that it will be the responsibility of all members to act in such a way that the government will be in a position to plan those borrowings as efficiently as possible. For that purpose, the government must be have the necessary authority to plan its own financing.
Most of the program must be financed during the nine remaining months of the fiscal year and it will be practically impossible to stagger new borrowings because of a temporary lack of borrowing authority without having to pay higher interest costs for Financing our debt. Mr. Speaker, 1 am convinced that Canadians understand that the higher deficit is due to the automatic response of the stabilizing agents in our economy and that in the extremely hard times we are going through, it could be even more difficult for Canadians to accept drastic cuts in government expenditures to reduce the size of the deficit which is justified if we are to live through the extremely acute recession we are in now.


Mr. Wilson:: Mr. Speaker, 1 wonder whether the minister would accept a question at this time.


Pierre Bussières: Yes, Mr. Speaker.


Michael Holcombe Wilson: I was trying to follow the figures which the minister put forward during the course of his speech regarding the use of the borrowing authority. I wanted to make sure that I was correct. I would appreciate it if he would clarify the figures. Will the borrowing authority take him to the end of this fiscal year, or will part of these funds be used in the course of the following fiscal year?


Pierre Bussières: Mr. Speaker, there is a clause in the bill to provide for an additional margin of operation of $4 billion which might be carried over until the following fiscal year.


Charles Joseph Clark: Mr. Speaker, I am a baseball fan, and I remember when the changes were brought in to the American League; assuming that a batter was not quite up to being able to knock the ball out of the infield, they brought in a designated hitter. It is pretty clear that the Minister of Finance (Mr. MacEachen) felt he was not able to come in and defend the atrocious $20
billion deficit and the demand for money which the government does not need and cannot justify, given its absolutely incapable handling of public expenses in the past. We do not have a designated hitter here. We have a designated apologist sent in by the Government of Canada.


An hon. Member:: He is a very weak batter.


Charles Joseph Clark: He is a very weak batter.
The minister has had three strikes, three budgets, and he has fluffed all of them. If he were a man with any honour at all, he would not simply be absent from his place today; he would be absent from his place forever. He would resign from the House of Commons; he would resign as Minister of Finance.
I really do not know who the minister thinks he is trying to fool with the figures and the excuses he brought in today. First of all he said-
[ Translation]
-and 1 think I understood correctly. I clearly heard what he said, and he said that as far as jobs in Canada were concerned he had been successful. And what a success! What about the workers at Pratt & Whitney Aircraft of Canada Ltd. who are no longer employed today and who had jobs before the government launched its economic policies? He managed to create unemployment among people who, before his government was elected, were working for Dofasco, a company that for the first time in Canada's history has now been forced to lay off people who have been working there for many years.

The list goes on through RCA, through the people with Ingersoll-Rand, through the thousands of people in the textile industry and through the women who were mentioned by the hon. member for Kingston and the Islands (Miss MacDonald) today, women suffering from unemployment more seriously than anyone else in the country. The minister of state for the status of women said, "Oh, they are all right; we are sending around a commission of inquiry to find out what is going on". They are not all right at all. It is absolutely unforgivable behaviour for the minister to come into the House and pretend that the government have succeeded with their employment policies. If success is to throw hundreds of thousands of Canadians out of work, then they have succeeded. But if they have any sense of responsibility at all, they must realize that their anti-investment policies and their tax policies which discourage Canadians from putting money into the country are the reasons so many Canadians are out of work today. It is inexcusable for this minister to come in here and pretend that there has been a success when there has been such abject failure.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Then there is this nonsense about comparing us with other countries and saying that our deficit is no more serious than the deficit in the United States. The minister knows that on a per capita basis the deficit borne by individual
July 19. 1982

Canadians in the country is almost twice as great as the deficit borne by citizens of the United States of America. We are doing almost twice as badly as the government of the United States which the Minister of Finance, when he finds the courage to come to the House of Commons, has the effrontery to castigate. We are doing almost twice as badly as the Americans, and that is nothing to crow about. The minister should come in here, clothed in sackcloth and ashes, and ask the forgiveness of the House of Commons and the people of Canada.
Then the minister talked about the government's anti-deficit policies having worked. Those anti-deficit policies worked, in their being 100 per cent wrong. When before, in the history of any government, have we had a situation where the minister brings down a budget in November, says the deficit will be $10 billion to $11 billion, and is proven to be 100 per cent wrong only seven months later? He will blame the world for that. This minister, this designated apologist for the Minister of Finance, is the kind of fellow who would solve the Rubik's cube by painting each one of the little cubes.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Also he said that they have not started any major new expenditure programs. Well, they have kept going an awful lot of little expenditure programs which add up. Let me quote from The Toronto Star.
On Monday night, Charles Lapointe, minister of small businesses and tourism, joined with Gerald Regan, minister of fitness and amateur sport, to throw an opulent bash for the players' team representatives and other visitors at the Place des Arts.
Liquor was free, French wine flowed endlessly and buffet tables were heaped with poached Gaspe salmon, lobster, filets of roast beef, Digby scallops and wild rice from Manitoba.
The article indicated that an orchestra played for dancing and, as hundreds of sparklers were lit, a giant cake was trundled in to the tune of "Canada". Also it indicated that smiling spokesmen for the office of the Prime Minister (Mr. Trudeau), that champion of restraint, were unable to supply cost figures for the event.
The minister says that there have been no new major expenditure programs. He knows also that there has been no attempt at all by the government to eliminate all those little envelopes of waste which add up to thousands, hundreds of thousands, millions, and perhaps hundreds of millions of dollars of the people's money being wasted by this extravagant, careless government which now has the effrontery to come back and ask for $11 billion more.
He also said that the deficit, on which they were only 100 per cent wrong, was all due to world events. They will probably try to do better next time; Lord knows what the next budget will bring. He knows that is not true. If he does not, then he should find some employment other than as the designated apologist for the Minister of Finance. He knows that one of the reasons the tax revenues were down, if I can quote him, was that his government followed an energy policy designed deliberately to drive out of the country people who would invest money in the country and create jobs in the country.
Supplementary Borrowing Authority
That is why tax receipts are down; people would have been working.
Today the Minister of Energy, Mines and Resources (Mr. Lalonde) refused to answer a legitimate question put by the hon. member for Athabasca (Mr. Shields), a member who has to go home every weekend and speak to the people who are out of work at Alsands, who are working below capacity in Syncrude and in other projects. He would not give him the courtesy of a straight response. Yet the Minister of Finance is the one man who is responsible for the failure of the Alsands project. He and his colleagues in the government are the one cause that is responsible for the vast amount of money that would have been creating jobs in this country leaving Canada. If the designated apologist for the Minister of Finance does not understand that, he had better get out because he will not understand anything. His policies have caused the decrease in tax revenues. His policies have caused the increased demand on unemployment insurance. His policies have caused the increased demand on social services. His policies are causing the increased family tensions, family break-ups, suicides and other violence in Canada. They are his responsibility. He cannot get away with blaming it on others.
I am amazed that the minister would have tried that kind of performance at the beginning of his remarks today and used it as justification. It only shows how desperate the government is and how incapable it is of justifying, on the evidence, its attempt today to ask the House of Commons to authorize giving this gang another $11 billion of the people's money to fritter down the drain. He knows he cannot justify that so he comes in and makes claims that he knows are not correct.
In the long debate on this bill we will be talking about billions of dollars. We will be talking about controls on public spending. We will be talking about hidden spending. Most of all, we will be talking about honesty and the standards this government applies when it spends the people's money and asks the people to join in restraint.
Last week the government asked for the authority to limit the wage increases of secretaries. That was the 6 per cent society. Today it is asking for the authority to increase its net debt by over 12 per cent. That is the double standard society; 6 per cent for the secretaries, 12 per cent for the new increase in net debt sought today by this government in comparing consecutive pieces of legislation.
But that is only the beginning of the economic deception that is being practised by this government. It is an economic deception which this bill dramatizes. Consider these five other factors. First, the government itself-these are its Figures- estimates its financial requirements at $17.1 billion, it already has borrowing authority of $3.6 billion left over from previous years. It has $6.6 billion in borrowing authority from a bill that was given royal assent almost a month ago today. It now wants $11 billion more. It wants $4 billion more than it says it needs; it might be for contingencies. Contingencies may arise.

July 19, 1982
Supplementary Borrowing Authority
There may or may not be someone else the government has to bail out.
The minister gave the indication that part of the money he is asking for today will be spent in the next fiscal year. That was the clear implication of his response to my colleague for Etobicoke Centre (Mr. Wilson). The government is asking for another $11 billion, $4 billion more than it needs. What is that $4 billion for? Is it a cushion? Is it really a cushion, is it a fund for a new Petrofina, a fund for a new fleet of Jetstars, or is it a fund for some new patronage the government will introduce? Is it a fund for some new propaganda campaign that it will mount? This government does not need a cushion, it needs a bottom line. That is one factor.
Second, the June 28 budget contained no economic projections beyond the end of the current fiscal year. The government is asking Parliament to grant borrowing authority including borrowing authority which will carry into the next fiscal year, regarding which they have given no financial projections. It is asking Parliament to grant borrowing authority without giving any indication at all of its finances into the future. That is an affront to this Parliament. No banker outside of these walls who deals with a businessman or businesswoman, large or small, would grant a line of credit to a financially crippled business that refuses to provide projections of its cash flows. No banker would do this, yet that is what this government is asking the House of Commons to do.
The government says that its situation is too uncertain for it to predict. In that case, then, it is too uncertain for us to grant billions of dollars to a government that was 100 per cent wrong in its deficit estimates last November.
I will give the government an opportunity later to reconsider this bill. When the government gets its act together, 1 say let them come back to Parliament then. We are here to protect the Canadian public. We are here to protect the people of this country, not to feed the habit of a government that cannot even say where it is going.
Third, this government has deliberately set up new and secret ways of spending the people's money without any ability of Parliament to control it or even to count what has been spent and what has been wasted. Crown corporations have become the new way to hide waste or to authorize borrowing against the name of Canada, and to do it without the knowledge of Parliament. We know the government's belief in the breeding rights of Crown corporations. It thinks that every Crown corporation should have the natural right to reproduce indiscriminately. That is known as the rabbit theory of government. As soon as those Crown agencies are born they can go out and borrow and borrow again against the name of Canada. Today there is no limit to the total amount Canadian Crown corporations can borrow but there is a very tight limit on the ability of Members of Parliament to look into the operations of those agencies.
For example, does anyone here know the advertising budget of Petro-Canada? Does anyone here know how many people who work for cabinet ministers are having their mortgages subsidized by Petro-Canada or any other Crown agency? Of course not. We do not know those things. All we do is give
them money at the demand of this government. We have no means of ensuring that this money is being spent in the public interest. It breeds the bunnies and we have to pay for the bunnies. This House of Commons should be out of the business of paying for bunnies that we do not want to have running around destroying the Canadian economy.
In Bill C-96, the government proposes to impose even further limitations on Parliament's control. Among other things, that bill would let the government write off debts of any amount through a simple vote in an appropriation act. It gives the government absolute freedom to spend any receipts and any revenues that are credited to a vote in an appropriation act. it lets the government use an appropriation act to guarantee loans. I mention that bill, which is not before the House at the moment, because it reduces Parliament's ability to control spending at the very time that this government seeks to increase its authority to borrow by $11 billion this year and into the next fiscal year.
Fourth, the government claims that it has embarked upon a crusade to fight inflation and to save the economy. That is some crusade. Its ministers sit back in their air conditioned offices asking for billions of the people's dollars and then sends secretaries, messengers and trainmen who work for the CNR out into the battle.
If this government were honestly serious about an economic crusade, it would engage in the whole war, not just one limited battle. It would recognize, as the world does, that the National Energy Program is doing more to destroy jobs and confidence in Canada than the salary levels of secretaries in the public service. The government would end that threat to jobs and growth in Canada right away. If it were honest, it would restore tax incentives to let individual Canadians create jobs and confidence. If it were honest, it would cut its spending, not ask for $4 billion more than it says it needs. Last week, the government called it a crusade. This bill proves that it is a pretence designed to have everyone suffer but the Liberal government, which preaches restraint for everyone else and then seeks to borrow billions of dollars, some of it for unspecified purposes.
Finally, I would like to address the question of restraint. This $20 billion deficit government is so proud of restraint. We know of the waste that bobs to the surface, the $110,000 spent to teach Bruno Gerussi and Madame Benoit to cook in metric. We know about the $500,000 spent to provide free brief cases for public servants. While Canadians are out of work around the country, the government, which has done so well against unemployment, is running around buying brief cases at a cost of half a million dollars to provide free to Canadian public servants.
We know about the $3.5 million spent by the government on taxi fares. We know about the $10.4 million spent by the government on what is loosely called "hospitality". These are only the big ticket numbers. The questions could not get down
July 19, 1982

to some of the smaller expenditures. However, $10.5 million was spent on food, liquor and entertainment. We know about the $12,000 spent to send an assistant secretary to the cabinet to the Riviera to learn French while she collects her $60,000 to $70,000 annual salary.
[ Translation]
It is not as expensive in Saint-Jean or Jonquiere, and people can learn French right here or, if they want to go to France, they should pay their own way.

How much more of this is hidden away? How much more of these little pieces that bob to the surface are hidden away? How many Crown agencies are in existence today on which the sun would have set if we had a sunset law, as the government of this party proposed when we were in office? How much money is wasted because there is no parliamentary control over Crown corporations? Hundreds of dollars, thousands of dollars, hundreds of thousands of dollars, millions or hundreds of millions of dollars? We do not know, and the government is doing everything it can to ensure that people do not know how much is being wasted, because it rejects every opportunity to give Parliament, the representatives and the people, the right to see, to identify and to eliminate the waste which has become a stock in trade of the government.
We proposed a special all-party examination of spending estimates to eliminate waste or to eliminate frills. The government rejected that proposal. We drafted legislation to introduce sunset laws so that, instead of going on spending forever, agencies which no longer needed to be in existence could be wound down. The government killed the idea of the sunset law. We drafted legislation to deal with Crown corporations. The government killed it. It rejects every attempt at restraint, yet it comes in here and demands billions and billions of dollars to spend.

Mr. Speaker, there is something else hidden in this Liberal plan. It is going to raise interest rates. It is going to put one more burden on Canadians who are struggling to pay their mortgages and on people who have to borrow so their farms or businesses can continue to operate. Interest rates are already too high as a result of policies that were adopted deliberately by the Liberal government in Ottawa. Its energy policy has caused millions of dollars, worth of investments to leave Canada. Tax changes have added to the investment drain, and it seems the government is trying to bring about a regular exodus. It was going to take steps to bring investments back to this country. The Liberals are using high interest rates to bring back investments that fled because of their policies. Businessmen are paying higher interest rates because of the Liberals' energy and tax policies. The same policies are making farmers and mortgage holders pay high interst rates. And what do the Liberals want to do now? They want to do something that will make interest rates go up even more. They want authority to borrow another $11 billion. Where is the money going to come from? It is going to come from the people who are lending to
Supplementary Borrowing Authority
businessmen, to Canadian farmers and to Canadians who want to build homes? And there is only so much money to go around.
The government will therefore be forced to compete with Canadians to secure those funds and as a result interest rates will climb higher still. During the calendar year 1981, borrowings by Ottawa accounted for 44 per cent of the total amount of new issues in Canada. Any money borrowed by the government in Ottawa is money that Canadian citizens would use instead to create jobs, set up businesses, keep their farms or build houses. One of the effects of the government proposal is that it will be more difficult for people to get affordable interest rates, and that is only part of the cost Canadians will have to pay for this Liberal government's incredible indebtedness. In just 14 years, the Liberal government boosted its expenditures by 630 per cent. Is there a single individual in Canada who has managed to do as much? Each Canadian shoulders part of the public debt which now amounts to $14,300 for each taxpayer. That is on top of his personal debts. That is the additional price each taxpayer must pay for the profligacy of the Liberals. This year, the cost of servicing the public debt will be $700 for every child, woman and man in Canada. So what do the Liberals do when confronted with such an unacceptable situation? They want to borrow even more!

There is much more at stake here than the borrowing bill. Two deeper questions are at stake. One is whether the government will respect the money that individual Canadians work hard to earn. The second is whether this government, which has recently announced that it is on a crusade-


Mr. Blenkarn:: What crusade?


Charles Joseph Clark: -will have the honesty to recognize that its own bad habits have created much of our economic chaos and whether it will have the courage to change its own habits. Too often in the past, when faced with grave national problems, the government has ignored the cause of the problems and has gone out to find a scapegoat and then to attack that scapegoat. That was the approach with the Constitution. That was the approach with the energy program. That was the approach taken with medicare. Now I gravely suspect the government will ignore the real problems of the Canadian economy and go around looking for someone to blame.
The new budget was not written by the Minister of Finance. It was written by Martin Goldfarb, the Liberal Party pollster who told the government that public servants were unpopular so it was safe to restrain their wages. An honest government would go beyond its pollster and do what is right for the country. It would recognize that the major domestic problem we face today involves the question of confidence. No one, absolutely no one, trusts the government. It is an open question whether the government can ever regain trust. The only way it can do that is to recognize that economic recovery requires more than wage restraint. It requires the government to lay

July 19, 1982
Supplementary Borrowing Authority
aside the ideology of intervention inherent in the energy program, to lay aside the assumption in its tax policy, that the state is always more important than the citizen, and to begin a serious war on waste in government.
This bill explains the distrust in Canada. It is a symbol of the double standard. Secretaries's salaries are to be held at 6 per cent but the government's net debt is going to be increased by over 12 per cent. If you take account of all the borrowing this year, Mr. Speaker, the total borrowing authority this year will increase by over 18 per cent while secretaries are held to 6 per cent.
We cannot approve this double standard. We cannot approve this demand for even more borrowing. For that reason I will be moving an amendment now and making reference to what amendments we intend to move later. I now wish to move, seconded by the hon. member for Joliette (Mr. La Salle):
That all of the words after the word "that" be deleted and the following substituted therefor:
"this House holds the opinion that the granting of an authority for the borrowing of a sum greater than that amount which is required to meet the government's needs to the end of the current fiscal year is objectionable in principle and this House therefore declines to give second reading to Bill C-125, an act to provide supplementary borrowing authority."
I move that amendment based upon the minister's own admission in this House that portions of the borrowing authority he is using here today will be applied in the next fiscal year. It is on that basis and because we believe that there is no justification on the part of this government to have that kind of borrowing authority that I introduce that amendment.
We will be proposing two other major amendments later and several other important changes when the bill comes back. What I trust this government will do, what 1 implore it to do, is to take this amendment as cause to go back and recognize that until it has demonstrated a determination to practise restraint at home, until it is prepared to practise as it preaches, it has no moral right to come here and ask for billions of dollars more of the people's money.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Until the government brings in another bill that conforms with the rules of this House and takes account of that recognition, we cannot vote the government money while it goes on spending money like a drunken sailor. When the bill comes back, there will be some other major amendments we will want to introduce, unless there has been a dramatic change in the proposals of the government. One will be to cut to $5 billion the amount that this government is authorized to borrow. We will reduce the borrowing from $11 billion to $5 billion. This government has admitted that it cannot predict or foresee its financial requirements for the future. It has introduced legislation to limit even further Parliament's ability to control spending. It has refused inquiries into ways to reduce waste. It has no right to be trusted with expenditure of the people's money.
Of course, government services have to go on. Our action will not jeopardize that. All it will do is keep this government on a shorter rein. This government will have to come back to Parliament if it wants to borrow more money. Then it will have to give us good reasons why that money is necessary. We are not going to pour billions of dollars of the people's money down the hole that this government has dug.
The second major amendment we propose to introduce, unless the government introduces a successor bill to the one before us, will provide a limitation on the aggregate amount that Crown corporations may borrow. It will also limit the guarantees given by government for borrowing by agencies like Canadair

I do not use that exclusively but as an example- for borrowing under agencies like the Enterprise Development Board and for financial rescue operations like Massey-Fergu-son, Chrysler and others that might negotiate with this government. While the government is opening new ways to spend money without control, we must seek new ways to control spending of the people's money by the government and by the agencies of the government.
The basis of Parliament is the right to control spending. That is why we are here. That is why we were created. That also means the right to control borrowing. It is more than a right, it is an obligation of this House of Commons.
If the government were serious about restraint, it could have moved on a Crown corporations bill. There was one ready. It could have moved on a sunset law. There was one ready. It could have continued the privatization program. It was already in effect. It could have moved to establish a special committee to investigate and eliminate waste in spending. It could have moved to eliminate the waste that it knows about. It has done none of those things. Instead, it simply comes back again begging for more money. We on this side of the House are responsible. We will not give the government more money.


Some hon. Members:: Hear, hear!


Mr. Deputy Speaker:: The Right Hon. Leader of the Opposition (Mr. Clark) has proposed an amendment at second reading. The Chair will take it under advisement; it will not express an opinion on the amendment at this stage.


James Ross Fulton: Mr. Speaker, 1 am pleased to have an opportunity to speak on this bill. It is abundantly clear that Bill C-125 should not be before this House now. As the previous speaker pointed out, the $11 billion is not required now. Even the Minister of State for Finance (Mr. Bussieres) indicated that some $4 billion of that amount could well be carried over until May, June or July of next year.
I am pleased to speak against the spending practices of this government and, therefore, its borrowing practices. Bill C-125 calls for Parliament to support supplementary borrowing in 1982-83, and perhaps further on, of $11 billion. The government has created for Parliament and this nation a terrible debt. Already the debt is expected to be more than $19.6 billion for this year. Public accounts published just last year
July 19, 1982

estimated an astonishing national debt of $136.5 billion. This means that for every $10 raised, in excess of $2 must be used simply to service the debt.
There are two very different philosophies at work in this House of Commons. I say two because the Liberals and Conservatives share identical approaches to economics. The Leader of the Opposition (Mr. Clark) said that waste should be cut from government. There is no question that there is waste that should clearly be cut back. But there is also a responsibility on the opposition to point out where the major cuts are going to take place. To talk about 6 per cent for secretaries and a 12 per cent increase in government spending places a very important requirement on the Leader of the Opposition to say where those major cuts are going to be. He talked about cutting billions. I would be interested in knowing where the Tories plan to cut. I certainly intend to outline today where the NDP would make some cuts.
1 listened with care to the Leader of the Opposition. 1 could not help but recall his profound statement to The Toronto Star on May 5 of this year when he said: "We have looked for a solution other than the government's, but we could not come up with an alternative. At this moment 1 don't have a better solution." Having listened to him for the last 40 minutes, it is clear that he still does not have a better solution.


Charles Joseph Clark: Mr. Speaker, I rise on a point of order. If 1 am going to be misquoted, as I have been, I would prefer to be misquoted with the attribution to the correct newspaper. The hon. member was misquoting me from La Presse. He claimed he was misquoting me from The Toronto Star.


James Ross Fulton: That was a very intelligent and useful piece of information. I quoted him from The Toronto Star. It comes as no surprise to me as a Canadian from British Columbia. We saw the Socreds adopt Liberal after Conservative into its ranks. That is not to say that the Tories are not more reactionary but that in general those two parties represent the same big business interests. The NDP is, as many Canadians are coming to appreciate, quite different in its approach to economic, social and development matters. I will come to that in a moment.
However, the style of the Tory approach to why there is debt is worthy of scrutiny. The Leader of the Opposition is awfully quick on the draw to attack Madame Benoit and Bruno Gerussi, as he did again today, for the $110,000 metric cooking lessons. No one, of course, supports such extravagance. To be using it every day in the House of Commons, however, makes most members of the general public quite weary of where the Tories are really heading.
It is good that this kind of unnecessary and inappropriate expenditure be stopped; however, it is wrong and politically reprehensible for the Tories forever to be calling for restraint but never offering to produce a balance sheet showing where and what they would cut. Since they say this debate will be a long one, as the first speaker for my party 1 will give them an
Supplementary Borrowing Authority
opportunity to respond as to just exactly what envelopes they plan to cut; otherwise, they should sit down and keep their mouths shut.
The 1982-83 budget for economic development is listed at $7.5 billion. I would like to know where they plan to cut that. The envelope for energy is $3.3 billion; social affairs, $30.15 billion; justice and legal affairs, $1.5 billion; services to government, $3.4 billion; Parliament, $156 million; defence, $7 billion; external affairs, $2.16 billion-


An hon. Member:: There it is.


James Ross Fulton: -fiscal arrangements, $4.9 billion. The Tories say they would get rid of external affairs. We will be interested to see how deep and in what areas they plan to cut. The envelope for the central reserve is $800 million. The public debt will be $59.5 billion. Public debt charges are estimated for 1982-83 to run $16.7 billion. The total outlay is $76.3 billion. 1 place those figures on the record so that in the coming days journalists and members of the Tory party can refer to them and tell us just exactly where they plan to cut.
The hon. member for St. John's West (Mr. Crosbie) perhaps encapsulated the Tory reality when he was interviewed by Maclean's magazine on July 12 of this year. He described the Liberal government accurately as: "adrift; it has no answers". However, he went on to say: "If 1 told you what I'd do, we'd never get elected." I think it is about time the people of Canada were told just exactly where the Tories plan to cut. We know the government is completely out of control and is wildly excessive in its expenditures, and we will outline where they can be cut back; but we would like to hear from the Tories hiding behind the curtains as to exactly where they would be cutting.


An hon. Member:: Who put the government there?


James Ross Fulton: The Tories want to know who put the government where it is. The people of Canada put hon. members opposite where they are because they saw what the Tories were all about.
The statement of the hon. member for St. John's West to which I referred a moment ago is at the root of the terror facing most of Canada's electorate. One voter in four now supports the policies of the NDP federally, and three out of four are subject to shift between the identical, but equally dishonest, policies of the Liberal-Tory coalition.
The hon. member for St. John's West also had this to say when he appeared on "The Watson Report": "Our leaders have got to be a little less honest. We are not being devious and tricky enough. I am criticizing us for that." The hon. member for St. John's West is a leading Tory spokesman. The Tories can speak for their own deviousness and tricks. 1 find it sad that the media across the nation are so tied to the observance and analysis of which Neanderthal in that relationship is on top. They fail miserably to provide the Canadian voter with a clear view of the real alternative policies and economics presented by my party in this House.

July 19, 1982
Supplementary Borrowing Authority
Let me deal first with the essential structural problems of Canada's economy and analyse briefly the Liberal-Tory approach to economics as against how a New Democratic Party government would proceed. The Liberal-Tory team has, since 1867, allowed foreign interests a free hand in developing resource extraction projects and branch plants in this country. This influx of foreign capital has done much to develop our nation, but in recent years it has returned to its country of origin or, at least, has left Canada. Literally tens of billions of dollars created by Canadian labour and resources-and in many cases Canadian capital-have flowed across the borders. The United States, of course, has benefited enormously from the use of Canada as a branch plant and a resource provider.
The Liberal government, clearly supported by the Tory chameleons, says Canada's economy cannot be stimulated, that jobs cannot be created and that the number of homes we require cannot be built. The steady state economics of producing the goods and services we require is pooh-poohed by the Liberal-Tory team because they say it is not good for big business. The Minister of Finance (Mr. MacEachen) will not change his high interest rate policy and, as a result, the overwhelming majority of Canadians face the prospect of declining incomes and a series of recessions, with the economy recovering for only a few months at a time.
The recent budget predicts higher rates of unemployment later this year and higher still next year. So for what purposes does the government require $11 billion, particularly when the Minister of State for Finance has already stated the government has no requirement for that money now and perhaps will not until November when Canada Savings Bonds start being cashed?
Clearly, with the deficit doubling from November to July- a staggering jump of some $10 billion-we have part of a ready answer. The economy, which is constructed much like a suitcase with a false bottom, has funnelled billions in recent months to the home offices of the multinationals which face debt and liquidity problems around the world. As Canada's raw resource sectors of mining and forestry wind down, hundreds of thousands of workers are directly and indirectly thrown out of work. Rather than buckle down and use deficit financing to design strong, appropriate underpinnings for a steady state economy which can put Canadians to work for the long haul, these two parties, the Liberals and the Conservatives, will opt to use hundreds of millions to buoy up sectors of the economy which, in my view, have already been relegated to the pages of history.
How many members of this House are aware of the fact that the hydro corporations of this nation are now the largest borrowers in the world bond market? How many of those same members are aware of the enormous advances which have taken place in the field of alternate energy? As recently as this week there has been the patenting of the vertical access water turbine, which extracts energy from river and tidal currents with small head drops. This technology eliminates the need for dams, has only minor environmental effects, allows the free passage and return of migrating fish stocks and does not flood or change natural water tables and important sectors of marine habitat.
Some hon. members, particularly Tories, may wonder why 1 am responding to the borrowing bill. I raise the issue of energy and give such an example for one simple reason: it is these kinds of technologies which this nation must foster and fund, not only to get away from the disastrous economics and environmental impacts of Arctic and offshore drilling, but also to avoid the impending shortfall of liquid hydrocarbons and high costs of using coal and tar sands in the future.
Can we easily forget that it is only ten years since the Liberal minister of energy told this House and all of Canada that we had hundreds of years of oil reserves? This coalition of phonies has us importing oil now at a cost of billions of dollars a year. Joe Greene seriously misled Canada in order to continue selling our oil offshore to keep a few big businesses happy, and he was supported in that endeavour by the Tories in this House. Now this same coalition intends to sell off, with 20-year contracts, our natural gas. They propose contract exports this year of 31 trillion cubic feet, 20 times what Canada will consume this year, and we will be forced to use more expensive alternatives in the future. The coalition intends to sell gas, first, through a pipeline which goes from central Alberta to U.S. markets. That, of course, was supported by the Tories. They said the Alaska pipeline would be built all the way up and that Canada would have many wonderful benefits. The people of Canada will have to judge fairly soon what kinds of deals the Liberals and Conservatives can cook up to support their oil company friends.
Second, our natural gas is to be exported by tanker from the Arctic through the Arctic pilot project route and other routes to Europe, and now it is proposed that gas be exported from Prince Rupert to the Orient. Instead of borrowing to sell our heritage we would be far better served by a borrowing policy which would pursue national objectives by developing environmentally and economically-and employment-oriented- sound projects.
Finally, what Canadians want is an honest government which will show some leadership and not sell Canadians out for a quick buck through oil, gas or other deals. Such deals are a sure sign of small-minded politicians who always go for the quick buck to try to buoy up the economy. Through sheer hucksterism, the Liberal-Tory coalition has managed to lower Canadian expectations to the point where convicted sex killers are the only group less popular than politicians. Sure, the Tories will rant and rave about government waste, and there is government waste. I spent the better part of last week battling with the Liberals to try to get them to release records about international flights of senior public servants from the Ottawa area. Fifty-eight are now known to fly every day internationally, excluding officials of the Department of External Affairs, the Department of National Defence and international trade officials. Some is certainly waste.
Some real waste was outlined by the Leader of the Opposition. However, when trips are chosen by bureaucrats for holidays and when spouses' travel is paid, combined with the
July 19, 1982

fact that not one bit of information has been released by the ministers responsible with respect to those tickets and other waste, it is truly shameful.
However, should this debate on the borrowing of $11 billion be solely on waste? Surely not, because those same members of the Tory caucus who howl about waste never lifted a finger in government only two years ago to set up procedures to stop it. They did absolutely nothing.
What about the Liberals? Mr. Speaker, would you hire an arsonist to study a self-set fire? I proposed today in a motion under Standing Order 43 that members of the opposition be allowed to scrutinize certain government expenditures and, as always, the Liberals turned it down.
We are running out of oil. This is the twentieth consecutive year of production declines in Alberta. This country is even running out of wood. In British Columbia, forestry officials from the public and private sectors admit that we face a serious wood shortage or fall-down effect within the next 30 years. It would take 160 years to replant the naked backlog in areas requiring seedlings at our present rate of reforestation in British Columbia.
As far as the coal deal in British Columbia is concerned, even though we can construct the stacker-reclaimer in Canada, it is to be built in Japan. The boats to haul the coal could be built at Burrard but instead they will be built in Korea and Belgium. The boats for the gas deal will be built in Japan and Korea.
Is it any wonder that we have no secondary industry when hundreds of thousands of jobs are exported with our underpriced petroleum? The government is intent-wittingly or not-on bankrupting this and future generations by continuing with a policy of supporting long-term energy, mineral and forestry exports and, as often as possible, in the raw form, without instituting policies to employ and benefit all Canadians.
Surely the time has come for an industrial strategy which funnels Canadian capital and aspirations into high technology, manufacturing and an employment base that is secure. No nation, no region and no family can survive the kind of economic storm that such a high debt and insecure industrial base provides.
We have a $21 billion trade deficit in manufactured products. That amounts to over $1,000 for every man, woman and child in excess goods purchased outside Canada. It spells the loss of hundreds of thousands of jobs.
Why does business not invest and construct the widgets and gadgets in this country? In part the answer is in the way in which the $11 billion to be borrowed in this bill are to be spent. After all, only a month ago the government came before the House to borrow $6.6 billion through Bill C-111. To my knowledge that money has not yet been spent.
In the seven months since the ill-fated November budget, the deficit has climbed from $10.5 billion to $19.6 billion. The
Supplementary Borrowing Authority
same seven-month period has witnessed revenues falling more than $6.4 billion, from $69.9 billion to $58.5 billion. Simultaneously expenditures have increased by $2.7 billion, from $75.4 billion to $78.1 billion.
Simply put, with so many Canadians out of work and so many small and big businesses failing, tax revenue is not as high as was expected. There will be about $600 million less in personal income tax paid this year than was projected in November. This figure may vary widely as more Canadians move to a system of barter and trading of services in order to stay afloat economically. All of this will occur more dramatically due to the fact that personal taxes, for those still working, will be increased by $160 million in 1982-83 by deindexing.
During this same seven-month period, projections for income from corporate tax have fallen by $2.75 billion. Revenue from federal sales tax has fallen by $820 million because the economy has slowed to such an extent. Surely even untrained observers of the economy must note the intention of the Liberals and, to an even greater extent, the Tories.
An article which appeared in The Globe and Mail on April 17 this year written by Peter Cook said that this recession has been unique in several respects and that an examination of the cause of the downturn, rather than its effect, shows it to be a recession deliberately brought about and fostered by government to a degree that has not occurred before.
Individual Canadians are carrying an increasing proportion of the federal tax load. In 1952, individuals carried 23 per cent of the federal tax burden; 30 years later that has risen to 47 per cent. Corporate taxes made up 21 per cent in 1952 and had fallen to 13.7 per cent by this year. That is almost the reverse of what happened to the individual worker.
If this trend is to continue, the Liberals and Conservatives will make individual Canadians carry the full load of taxes by the turn of the century while the corporate sector will pay nothing. If this philosophy continues-despite the glaring evidence of the corporate sector pouring profits and dividends out of Canada-it will lead to a tax revolt across the nation.
Should the workers in the forest industry, for example, pay 30 per cent or more in income tax when they see MacMillan Bloedel, Crown Zellerbach or other corporations diverting profits made from harvesting and selling Canadian trees with Canadian labour to building pulp mills or saw mills in Brazil or Indonesia and not paying part of those profits as tax? It is both wrong and insulting to lay off tens of thousands of those workers and, after years of overharvesting, simply to move that forest-based capital to other nations and industries.
The Liberal government, supported by the Tories in this drive toward extending the recession, has created a need for an additional $1.1 billion to service the debt as a result of high interest rates. The Minister of Linance personally drove home his desire for higher rates by issuing Canada Savings Bonds at 19.5 per cent. A responsible government should have led the way to restraint by issuing low-interest shares in a scheme to rebuild the country. Most Canadians are eager and willing to
19460

July 19, 1982
Supplementary Borrowing Authority
put their shoulder in the traces and to hunker down for the long haul. There must first be a replacement of the Liberal-Tory recession, however, with the NDP-led policies for a longterm industrial strategy.


Donald Alex Blenkarn: Tell us about that. Borrow more?


James Ross Fulton: The hon. member for Mississauga South (Mr. Blenkarn) always has lots to rant and rave about, but I do not see him stand in his place very often to tell the House or the people of Canada exactly what he would do.


Donald Alex Blenkarn: You are not here very often.


James Ross Fulton: He is long on rhetoric and short on fact.
The reason that the accumulated national debt for every man, woman and child has reached $6,000, or over $14,000 for every worker, is that borrowed money has been used to bail out losers, to subsidize the oil and gas companies and other sectors. These so-called investments have not been giving Canadians a return on their money and now they are not even providing employment.
Government waste must be stopped. Government handouts to continual losers, such as the nuclear industry, must be reevaluated. Crown corporation borrowings and many questionable developments, such as most dams, must be stopped. Our borrowed funds must be used wherever possible for long-term job creation and community stability.
Thirty years ago it took 9.7 per cent of our revenue to service the national debt; now it takes over 25 per cent. All members of the opposition want to question this $1 1 billion borrowing because we know the public objects to further squandering and debt, particularly now that we know that the money may not even be required before next year. If the money is required later this year, Parliament should be recalled if it is not sitting. It is ridiculous to be putting this bill through now simply because the government thinks that the opposition will go and hide while it tries to squeeze out another $11 billion that it does not require.
Never before have so many Canadians been out of work or seen their farms or businesses so close to liquidation. The Tories hope to touch those chords of discontent but they do not have the moral capacity to lay out what pensions they would cut, what UIC payments they would cut, what medicare programs they would cut or what small-business programs they would cut.
The NDP view is different from the squandering blindness of the Liberals and the chilling dishonesty of the Tories. Let me quote again what the Leader of the Official Opposition said.


Donald Alex Blenkarn: Tell us about some of your own policies.


James Ross Fulton: This is what the leader of the hon. member's party had to say, Mr. Speaker: "We have looked for a solution other than the government's, but we couldn't come up with an alternative. At this moment 1 don't have a better solution." That was said on May 5.


An hon. Member:: Right on.


James Ross Fulton: An hon. member says "Right on." The Tories have voted to keep the Liberals' economic policies in operation
34 times this session alone. They do not like to talk about it but they are only marginally different from the Liberals.
The NDP has a workable Canadian option. We will cut interest rates. High rates are the driving force of this recession. They are of immense value to the wealthy in this country who are picking up farms, small businesses, homes and real estate at bargain basement prices. They will benefit immensely when they integrate into monopolies or sell these assets back at a future date to the same workers and individuals who originally owned them.
By stimulating the economy and providing full employment, the NDP would generate $3.6 billion in additional tax revenue. A $2.2 billion tax cut to low and middle-income earners through a refundable tax credit would create 50,000 jobs. By negotiating a postponement of the September 1 energy price hike, we would put $450 million back into the hands of consumers to spend in the marketplace.
We would put $2 billion into seed money for a corporation called Enterprise Canada to help Canadian industry modernize and move into the technologies of the 1980s. We have one of the most capable and educated work forces in the world. Private capital has remained in the resource extraction sector due almost solely to government subsidies, policies and profits.
We believe that the hundreds of billions of dollars in savings and assets of Canadians will be self-motivated to join in the task of creating a new and dynamic Canada once we have an honest government. The National Energy Program was a failure because the Liberals changed the rules retroactively. Canadians do want to hold a majority interest in Canadian developments will do so when led by an honest government.
We in the NDP will reshape the banking, savings and taxation systems to put small state of the art technology into communities from St. John's, Newfoundland, to Queen Charlotte city. Canadians want their small communities to survive; they want good, secure and interesting jobs for their sons and daughters in Montreal, Vancouver, Gimli, Terrace and Whitehorse. All that is lacking is the distribution of factual political material in a language that can be understood.
I come from a little community of only 100 people, Mr. Speaker, but they and the majority of the people in northwestern British Columbia do not vote Liberal or Conservative any more. They know that the big business coalition has let this country down. Through sleight of hand and well-practised deception-to the point, I might add, where many of the Liberals and Tories in this House believe that what they are saying is in the best interests of the country-Adam Smith's invisible hand is strangling small business, forcing our elderly to eat dog food, forcing our working class to bear debt, while the big-business elite reap profits.
We would put $500 million into the construction of social and adequate housing, creating 110,000 jobs. We would put $260 million into programs of reforestation and fisheries
July 19, 1982

development which have been overlooked by consecutive Liberal and Conservative and Liberal-Conservative governments, which in British Columbia are called Socreds. We would spend $5.4 billion to create 300,000 new jobs. We would spend and we would borrow, but we would do it in such a way that the money was wisely invested so that there would be a return. We would not force people out of work or onto lower wages, as the Liberals and Tories voted for on Friday with Bill C-124. Every Canadian out of work should know that this government's intention is to prolong the recession and force workers to take lower wages, a bottom line Conservative policy.
Two years ago the Department of Finance did a comprehensive evaluation of tax expenditures. Certain kinds of income are given preferential tax treatment. We all know that there were many who earned over $200,000 last year and who paid no income tax at all. These and other loopholes cost Canada $39 billion in 1980 alone. By the end of this tax year the loopholes will have reached $45 billion. Some few of the deductions are fair, such as spousal deductions and deductions for dependent children. Many are not. We in this party believe that the system should be revamped to put cash back into the hands of those who do the work in this country.
Here are just a few of the provisions which should be cut back or eliminated. The fast write-off in resource development; the most recent figures are from 1980, and they cost $1.25 billion. Excess depreciation in the resource sector, $370 million. Fast write-offs in manufacturing, $600 million. Nontaxation of half of capital gains, $800 million in 1980. The $1,000 investment income deduction cost the government $655 million in 1980. The list goes on for pages.
Before the Alsands cancellation the federal government gave the companies $8 million to ensure the project stayed open during negotiations. It was never returned. The government was prepared to give billions of dollars in concession to Alsands to get it under way and guarantee a 20 per cent rate of return.
The alternative energy sector in this country, Mr. Speaker, would replace many of these megaprojects overnight if given the kind of incentives and grants poured into the megas. Surely it is time we broke the stranglehold of the Crown and private hydro and fossil fuel giants. Combinations of tidal, wind, geothermal, solar and biomass can meet in an environmentally and economically sound manner the needs of most of Canada and the world. The global politics of oil and hydro are the chief opposition. The capital strike we witnessed earlier this year in the megaoil projects resulted from a lack of understanding of the energy monopoly by the present Minister of Energy, Mines and Resources (Mr. Lalonde). This same minister announced a gift of $2.2 billion to the oil and gas sector to pay them off for this blunder. Those funds are part of this $11 billion borrowing, no doubt.
The minister gave $40 million to Imperial Oil to keep Cold Lake going. Once it died the minister wrote that sum off and with it the taxes hard earned by thousands of Canadians. The Minister of Industry, Trade and Commerce (Mr. Gray) has given over $6 million to Hilton hotels in his own riding,
Supplementary Borrowing Authority
contrary to the guidelines of the program. The President of the Treasury Board (Mr. Johnston) is responsible for the loss of $125 million to Consolidated Computers, which was recently sold for a paltry $100,000.
In the last four years over $1.5 billion has been shovelled into the nuclear program despite the closure of nuclear facilities in the United States because they are a bad risk and a bad investment. We are producing, at a cost of $100 million a year, heavy water for nuclear reactors when there is no need for it at the heavy water sites in Canada, and no prospects of overseas sales. Perhaps when Argentina drops a nuclear bomb, heaven forbid, on the Falkland Islands, the Liberals will wake up to their folly and their national and international mistakes. These same donkeys will bail out Dome this summer, Mr. Speaker, rather than fund alternatives for a secure Canadian energy future.
In conclusion, Mr. Speaker, it is clear that no Canadian can accept the borrowing and spending practices of this group across the floor who are wildly out of control. Despite spending over $1 million every working day to advertise their political philosophy at taxpayers' expense, they have come back to this House in less than a month to borrow another $11 billion. In one month that totals $17.6 billion in borrowing authorized by this Parliament and it should be stopped. That is almost $2,000 for every taxpayer in Canada. How many taxpayers have borrowed $2,000 this month, last month or next month at a 20 per cent interest rate? No, Mr. Speaker, the Liberals are on the wrong track and should not be supported by this House or the Canadian electorate.
As for the Tories and their intention to filibuster this bill, let them remember the words of their leader: "We have looked for a solution other than the government's, but we could not come up with an alternative. At this moment I do not have a better solution."
Well, Mr. Speaker, the NDP does have a better solution and we do have a better way. Thank you, Mr. Speaker; I will let one of the Neanderthals tell us where they are going to cut.


Mr. Deputy Speaker:: The hon. Leader of the Opposition (Mr. Clark), seconded by the hon. member for Joliette (Mr. La Salle), has moved that Bill C-125 be amended as follows:
That all of the words after the word "that" be deleted and the following substituted therefor:
"this House holds the opinion that the granting of an authority for the borrowing of a sum greater than that amount which is required to meet the government's needs to the end of the current fiscal year is objectionable in principle and this House therefore declines to give second reading to Bill C-125, an act to provide supplementary borrowing authority."
The Chair has had an opportunity to consider the amendment and finds it acceptable from the point of view of procedure.


Donald Alex Blenkarn: Mr. Speaker, before I proceed to talk about the amendment and this bill, may I say to my friend, the hon. member for Skeena (Mr. Fulton), that I was impressed with his effort to increase the deficit. He talked about a new $2 billion tax cut, $450 million

July 19, 1982
Supplementary Borrowing Authority
for energy projects, another $2 billion for another government entity called Enterprise Canada, and then somewhere along the line he added another $5.4 billion. He came up to another $10 billion. He said he was going to oppose this bill and suggested, I presume, that the government borrow another $10 billion. Presumably the policy of the NDP would be to increase the borrowing in this bill from $11 billion to $21 billion.


James Ross Fulton: On a point of order, Mr. Speaker, I just hope the hon. member learns how to add. I was proposing what the NDP would do with the $11 billion that the Liberals are proposing to borrow and where we would cut. I hope we can hear from him precisely the same thing.


Donald Alex Blenkarn: I appreciate, Mr. Speaker, that the hon. member is having a difficult time understanding why he is opposing a borrowing bill at the same time as he proposes further massive government expenditures and interference in the economy. It is difficult to be a socialist these days, sir, but he, of course, comes from British Columbia and opposes a government in British Columbia which has at least one decent philosophy which is to not run the province into debt. That province has done exceptionally well in the management of its affairs by keeping down deficits and deliberately controlling its expenditure pattern. This is a pattern that should be followed by this government. If it had done so, the deficit of the federal government this year would be less than $3 billion.
This is the fourth time I have risen in this session of Parliament to speak with respect to borrowing authority legislation. The first bill we received at the opening of this session of Parliament was a bill for $12 billion. That was followed up within not many months with a request for a further $14 billion. The minister said this afternoon that the bill for $6.6 billion, the third borrowing authority bill, received Royal Assent on June 17. We now have before us in the month of July, just four weeks after the last bill received Royal Assent, another bill for an additional $11 billion.
This House has been asked to approve borrowing by this federal government of some $43.6 billion in this one session of Parliament. That is the wealth of 43,600 millionaires expropriated to pay the deficits of this government since it was elected to govern on February 18, 1980. It is unbelievable that Members of Parliament should be asked to allow a government to borrow that kind of money.
It would perhaps be understandable if the minister had shown to us this afternoon when he spoke-and he is not here at the moment; in fact, there is no member of the treasury benches here-where the government could have put that $43.6 billion to use. It could have used it to build Canada, to put people to work, to stimulate the economy of Canada or to make Canada grow. But you and I know, Mr. Speaker, that our country is not growing. Our country is stagnating. Every week thousands more people are laid off from jobs in plants, in the mines, or in the forest industry, with no real hope of being called back.
That is the financial attitude of this government that as of this week has run the net debt of the country to $94 billion and that will, before March 31, 1983, that is before the end of the fiscal year, run that debt up to $107 billion. That is an attitude which cannot be allowed to continue, Mr. Speaker.
The late John George Diefenbaker used to say "Where are we going?" Sir, where are we going as we borrow, borrow and borrow more and more of the wealth and the savings of Canadians and let this crowd handle our money in the ineffectual, improper and impossibly wasteful method that it does?
Canada's debt has become so enormous that it takes one in every three revenue dollars to pay the interest. The interest on the debt is projected this year at $17.7 billion. Let me repeat that fact. One in every three revenue dollars is required to pay the interest.


Frederick John King: The NDP would like to make that higher.


Donald Alex Blenkarn: The interest alone represents $723 per person per annum. That includes every man, woman, child and babe in arms. Or, expressed in another way, it is $1,864 per taxpayer, for interest alone. The interest represents 4.9 per cent of the gross national product in the country.
This afternoon the hon. member for Skeena talked about further deficits and how spending is stimulative. For a few minutes this afternoon I want to talk about the stimulative effect of debts. I want to say that there is no evidence whatever that government spending, particularly government deficit spending, is in any way stimulative. It may be said that when you spend money at least you put people to work, that people are doing something. But when you spend borrowed money that costs a minimum of 17 per cent for interest-a good part of it now at 19.5 per cent as a result of goofs in the Canada Savings Bond issue last year-you wind up with a situation whereby the dollar borrowed at 17 per cent doubles itself in three and a half years or so, depending upon the compounding. It may take four years to double or it may take less than three and a half years.
We have the situation that if $1 of government money is borrowed and spent allegedly to stimulate the economy, in order just to break even the Government of Canada has to give back $1.50 from taxes in a year and a half. That is not possible. There is not a single government program that can be justified on the basis of the stimulative effect of a deficit, because a deficit is not stimulative. A deficit is, if anything, repressive.
It is the repressive effect of the debt with which the government has saddled Canada that is indeed largely responsible for the economic morass in which we find ourselves. It is no secret that businesses in our country are starved for capital. They are under a liquidity crunch. Businesses cannot support the interest on the debt which they are carrying. When that situation happens, people are not able to replace machinery, people are not able to build, people are not able to create new jobs, because they cannot afford to.
July 19, 1982

1 am involved in some businesses. On a number of occasions 1 have been at board meetings during which we have talked about whether we should make improvements to a business, whether we should buy machinery, certain tooling or perhaps tool up for a new product. When interest rates were down in the 9 per cent and 10 per cent range, we could look with all practicality, to a four-year or five-year payback on investment. Today with interest rates running at a cost to business of somewhere in the range of 20 per cent, you cannot look at a four-year or five-year payback. You have to have the payback within two years because you cannot afford to borrow at that rate unless there is a two-year payback.
This is where we are at because of the massive borrowing that has crowded out the marketplace and has driven up interest rates. We now have a situation where the businesses in our country are suffering from a total lack of liquidity, where investments in new machinery and equipment, unless they can be justified in a two-year payback or less, cannot be made. Research and development cannot be financed unless that research and development can show a payback within two years, because it is not practical to do so.
Yet we have a government which two years back-to-back increased spending by 20 per cent each year. We have a government that is $20 billion in the red. It comes to Parliament for the second time in this fiscal year and says that it wants to borrow money. This time it wants to borrow $11 billion. It just finished borrowing $6.6 billion. We have a government that has no sense of reality as to the cost of money or as to the cost of doing things. It enters into program after program suggesting that the program will stimulate business.
There was a provision in the budget for $3,000 grants to first-time purchasers of houses. It could be used houses. The other day in Scarborough the minister for housing set up an orchestrated presentation of a $3,000 cheque. The man had already purchased a used house, but the minister wanted to give him a $3,000 cheque. When the reporter asked the man whether he needed the $3,000 grant in order to close the deal, he said: "No, I would have bought the house anyway, but it is nice to have the cheque." What did the minister say? He said; "Perhaps he did not need the cheque to buy the house, but he can do some landscaping, purchase some appliances, this, that or the other thing." I point out that that $3,000 grant, for a man who was going to purchase the house anyway, goes into his pocket. Indeed, Mr. Speaker, it does not come out of either of our pockets today; it comes out of the pockets of our kids at 19.5 per cent compound interest. What is it for? He might use the money to do some landscaping, to purchase some appliances or perhaps put it in his bank account.
Where was the stimulative effect of that $3,000 of borrowing by the Government of Canada? No new purchase was made, no new commitment was made, no new building was erected. Indeed, it was money paid straight out of the borrowing account to make the minister look good on television. 1 want to say that the minister looked like he usually looks- someone who is not competent to be in any government, let
Supplementary Borrowing Authority
alone this government. Even in this government he is incompetent, which is saying something.
Where are we going? My friends in the New Democratic Party talk about the horrible rip-offs of big business. They do not realize the statistics. Corporate profits in Canada are down from $24 billion to a projected $14 billion, to a projected amount lower than that. Where are we going as company after company is incapable of carrying on and is forced to close its doors, as there are bankruptcies on top of bankruptcies and receiverships on top of receiverships? We have reached the point today where a person has to shop the entire city of Toronto to find anyone who can conceivably act as a receiver because they are all busy. Perhaps a receiver can see him in two, three or four weeks, but he has to get on the waiting list. The only growth industry in the country is the receivership industry. We have a government which comes to Parliament with one program after another, spending money without any thought of constraint, borrowing money and squeezing out the marketplace.
Before referring to the crowding out of the marketplace, 1 remind the House that in early June government representatives attended a conference in Versailles. When they returned from the conference they blamed the United States. They said that the huge American deficit would drive up interest rates and that the government had spent its efforts at Versailles trying to persuade those dastardly Americans that they should not borrow what they were borrowing. I do not think anyone will say that the American debt is not high, but let me point out that the American deficit on a per capita basis is half the amount of our deficit. They tell the Americans that they are wrong, but they do not pay any attention to Canada.
We heard the minister suggest earlier this afternoon that Canadian savings were high and that there was lots of room for savings in Canada, so 1 thought 1 would put on the record of the House a table which was prepared by the Royal Trust company in its booklet entitled "Through A Glass, Darkly: A Medium-Term Canadian Perspective, 1981-86". Actually this table was repeated in a book by Arthur W. Donner entitled "Financing the Future-Canada's Capital Markets in the Eighties". Unfortunately it was written considerably before the present deficit and Mr. Donner was considerably more optimistic when he completed his work in February, 1982, than he would be today. Mr. Donner pointed out in his book that personal savings, as a percentage of the gross national product, of Canadians in 1980 were $14.9 billion. In 1981 he forecast a decrease to $13,148 billion and that since 1982 was to be a recovery year-and we know what kind of a recovery we are having-savings might go up as high as $18 billion.
The government says that it must borrow $17.1 billion in 1982, which is very close to the personal savings of all Canadians in 1982. The government is going to go to the markets of the country to borrow all the new savings of Canadians. We also know that the provinces are in the act. There is not a province during this downturn of our economy which does not have a deficit. Even some western provinces are now having to

July 19, 1982
Supplementary Borrowing Authority
borrow; even Alberta is borrowing. From where is the money to come?
Until this year the provinces, including the benefits available to them from the Quebec Pension Plan and the Canada Pension Plan, had surpluses of borrowing capacity. They could borrow from their pension plans, they had funds available. But in total the provinces will probably be in deficit positions this year and they will have to borrow.
What about business? What about where we build this recovery about which the minister talks? Where will we put the people back to work who the minister says are now being laid off? How do we get the country stimulated and going again? Where are the fresh funds to break the back of this recession-cum-depression? There is not any, not while we have a government which is prepared to soak up, to suck up and to dry up by its grasping hands every bit of savings in the country in order to finance its waste and its spending. This bill must be turned back even when considered on that basis alone. No matter how much we would like the government to spend money, our country cannot afford to go to our markets in the country to borrow money, especially in the amount being demanded by the government.
What have the effects of this borrowing been? We have seen the effects. Since there are not enough savings in this country to satisfy business and government needs here, we have to be a net importer of capital into Canada. Due to the provisions of the Foreign Investment Review Act and the attitudes taken in the November 12 budget and the National Energy Program, long-term capital has been driven out of the country. We have had to increase interest rates here so that they are now at least 3 per cent higher than in the United States. I suggest that because of this borrowing requirement there is no hope in the world that interest rates in Canada can drop below that 3 per cent diffrence between here and the United States. Indeed, I suggest that it may well be the fact that as more people in Canada lose confidence in the capacity of this country to grow, develop and become a creative environment, more Canadians and foreigners will remove their money and thereby make the interest differential increasingly higher. This is where this borrowing leads us and this is where the government's spending habits have led us.
Unless an immediate effort is made by Parliament to deal with the crippling deficits which have been imposed by this government and its predecessors, we will not be able to turn our economy around and come out of this recession-cum-depression. We will sink ever lower in the abyss. The future of our children is at stake.
I would like to analyse for a moment what this borrowing authority bill is all about. As you may be aware, Mr. Speaker, if, when borrowing authority is granted to a government, it does not use the borrowing authority, the normal course is that the borrowing authority lapses at the end of the fiscal year. If the borrowing authority is used, permanent debt is then
created. If that debt is paid off in some manner, the government immediately has the right to roll that borrowing authority over again and continue with the same amount of debt.
When we vote for borrowing authority for $11 billion, we are effectively saying to the government that it can on a permanent basis increase the debt of Canada by $11 billion. If bonds are raised under this borrowing authority and those bonds are repaid at some point, the government can then roll the bonds over or issue new bonds to new investors and still stay within the ambit of its total borrowing capacity.
Speaking of borrowing capacity, on July 6 the government had $5.8 billion of unused borrowing authority as a result of its actions this year. It now comes to the House looking for $11 billion. This makes a total borrowing authority of $16.8 billion, nearly $17 billion. So far this year it has used up some $4.5 billion by using hangover borrowing authority from last year, plus a portion of new borrowing authority which was finally granted to it on June 17.
The government has not introduced an acceptable budget. There is every indication that the government will be producing a new budget some time in November of this year. Therefore, why does the government want all this borrowing authority right now? The June 28 budget, which really was not a budget since it did not give proper projections, was indeed a specious piece of paper which indicated that the deficit figures were based on a gross national product dropping only 2 per cent this year. But we all know the projections now are that the gross national product of the country may drop over 8 per cent this year.
The budget was a specious document and will clearly have to be replaced before November 30. On that basis, why do we need more borrowing authority? The fact is that we do not need it. The government already has $5.8 billion in borrowing authority. The fact is that the government has $4.7 billion in the banks. The government has lots of money right now. It has $4.7 billion on deposit in the banks and $5.8 billion in borrowing authority. It has enough right now to pay its bills through to the end of November, and then some. Even with its crazy spending habits and the fact that it is spending $1.4 billion a month more than it receives in taxes, it has enough to carry it through to November. Therefore, why do we need this bill? There is really no need for it at this stage.
What we do need, however, is an inquiry into how government spending takes place. I remind you, Mr. Speaker, and the House about statements by the former auditor general, Mr. Macdonell, who said last week that what the government must do is analyse its spending program and its priorities. Its spending should be divided into what is absolutely essential, what is desirable and what is non-essential.
Where are we going? There is no effort by this government to priorize its expenditures. Does the government accept the suggestion of our party that there should be a task force of parliamentarians to inquire in detail into the expenditures of the government and the budgetary expenditures of each department in order to determine on a priority basis whether an expenditure is essential, non-essential or just desirable? It does not want that to happen. This should be done.
July 19. 1982

We must review the grant programs of the government and its activities and question whether these programs, while they may be very desirable, are essential. It may be desirable to have expansion in the Canadian broadcasting system, but is it essential? The National Arts Centre is obviously desirable but is it essential? The CHIP program is obviously desirable since it will save home owners money and enable them to get a four or five-year payback, but as 1 said earlier, businesses cannot invest in a four or five-year payback today because money costs too much. Is it essential or just desirable?
The Leader of the Opposition (Mr. Clark) went over a number of programs which are clearly frills. 1 write to the President of the Treasury Board (Mr. Johnston) almost weekly. When we formed the government, 1 wrote almost weekly to my hon. friend, the hon. member for York-Peel (Mr. Stevens), who was the President of the Treasury Board. When 1 received a book from a minister's department, a beautiful brochure or a map, 1 asked "Is it essential? Is it a non-essential frill expense?" My hon. friend, the hon. member for Kingston and the Islands (Miss MacDonald), smiles. I think something colourful and beautiful came from her department. There is not a single Member of Parliament who does not get material across his or her desk, is invited to something run by the government, or has been involved in some program, activity or trip. We must ask, are these really essential? Much of it is non-essential puffery. We could reduce expenditures in every department by 5 per cent, certainly administration costs and many others as well, if we considered and determined what is essential and what is non-essential. Sure, some of these expenditures amount only to $60,000, $100,000 or half a million, but they add up enormously.
When one is paying 19.5 per cent to borrow money and when the cost of that borrowed money triples in three and a half years, then the question matters as to whether it is essential, simply desirable, or really non-essential, or is the expense indefensible. Yet the government refuses to appoint a parliamentary committee to inquire into expense based on that logic. Why? It is because it likes it the way it is. It is so accustomed to going around and around the boat, spending and spending, without any real thought as to whose money it is.
The government has the free lunch theory, the theory that if there is a problem, the government should do something. People come into my constituency office and ask, "Is there not a grant or a program for this problem? Can you not help me with it? Can you not get assistance under some government program?" A small telephone booklet came to my office the other day with the names of government programs and grants in it. 1 am sure Your Honour received one. The government subscribes to the free lunch theory that, somewhere along the line the money comes down from the trees, you take it and spend it, you do not have to borrow it and do not have to worry about where it is earned. Well, I never got to this place because someone gave me a free lunch, and I am sure Your Honour did not become a Member of Parliament on the free
Adjournment Motion
lunch theory. Your Honour worked, created and produced. You did not look for a grant. But the money you took out of your pocket with which to pay taxes is being used by this government to further the free lunch theory. But it is not only the money expropriated from people who rake asphalt, drive trucks or work in offices all day, which is being used to pay the government's profligacies. We must also remember that the money the government borrows, and the money which is borrowed and reborrowed, on which we pay 17 per cent to 19.5 per cent interest, multiplies and multiplies. That is a tax which is not on me, because I will never pay it off, and it is not a tax on you, Sir, because you will never pay it off. Is the tax not on our grandchildren? And for what?


Frederick John King: They will never pay it off, either.


Donald Alex Blenkarn: My hon. friend says "They will never pay it off, either". Perhaps that is part of the problem of the free lunch theory. Somewhere along the line it must be carried on the backs of people who work and sweat, because some cocktail party, or cooking lesson, or free brief case is important; and the government is not prepared to inquire into whether it is important, essential or non-essential.
The government recently presented a bill to the House arising from the new budget called "the effort to go to a 6 per cent society." I only wish we could go to a 6 per cent society in terms of interest rates. That bill represents the first effort by this government somehow to curtail costs. At least, it is painted that way. But is it really? If one considers the bill, one finds that there will be no cutback in the salary of any public servant this year. Next year public servants will not receive a full index. That is all that will happen. The only people cut back in the government's latest budget were Members of Parliament. You and I, Sir, took a 5 per cent cut in pay. We are the only people who took a cut. Indeed, the government has no intention of cutting anything else. It has provided no new budgetary or departmental figures, projections, no new proposals to save money to reduce expenditures. The only expenditure cut in the whole budget was your salary and mine, by 5 per cent. I suppose we are prepared to be leaders; that is why we were elected as Members of Parliament. But I think, as leaders, and having contributed to some savings, we have the right to demand savings. I say to you. Sir, that we have a right to demand that the government trim back its expenses by 5 per cent, and it is on that basis that I say that this bill must be withdrawn.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised

July 19, 1982
Supplementary Borrowing Authority
tonight at the time of adjournment are as follows: the hon. member for London West (Mr. Burghardt)-Consumer Affairs-Use of subliminal messages on rock music recordings; the hon. member for Vegreville (Mr. Mazankowski)- Agriculture-Tax on fuel used in food production; the hon. member for Athabasca (Mr. Shields)-National Energy Program-Effect on investment, (b) Development of oil sands in northeastern Alberta.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Bussieres that Bill C-125, an act to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, 1 welcome the opportunity to speak on Bill C-125, an act to Provide supplementary borrowing authority. The bill is very short, covering only a page and a quarter, but it will be very long in its effects on each and every Canadian. It seeks to obtain authorization for the Minister of Finance (Mr. MacEachen) to borrow, with the approval of the governor in council, sums of money not exceeding $11 billion, as may be required for public works and general purposes.
The government has projected financial requirements of $17.1 billion this year and some of that requirement will be met through the rundown of Canada's foreign reserves. As I understand it, the government already has something like $10.2 billion in borrowing authority for this year, consisting of $3.6 billion in unused authority from previous years and $6.6 billion from Bill C-111. Therefore, the government has a total borrowing authority of something like $21.2 billion for this year, a figure which is considerably higher than the projected financial requirements of $17.1 billion as outlined in the previous budget.
I think it is also worth noting that in subclause (2) of Clause 2 there is special provision for unused authority of up to $4 billion to be carried over into 1983-84. This leads me to ask where all this money is going, where it is all coming from, and what is happening to Canada and to the Canadian economy.
Over the past 14 years government spending has risen at an unprecedented rate. Using Canada's public accounts as a basis, spending has increased from $12.3 billion in 1968-69, the year the Prime Minister (Mr. Trudeau) took office, to $78 billion this year, an increase of 534 per cent, yet the population of this nation during this period of time increased from approximately 20 million to 24 million people. A significant portion of this
increase occurred since the re-election of the present government in 1980.
The projected spending of $78 billion this year and a projected deficit of $19.6 billion, which is almost double the projected deficit of last November's budget, has already sent our markets and our dollar into a tailspin, and for good reason. Our gross national debt in March was approximately $135 billion. Interest alone on this debt will cost Canadian taxpayers this year an estimated $17.75 billion.
These numbers are large. They are actually too large for Canadians to grasp in a meaningful way. However, if they are broken down their magnitude becomes more understandable. For example, government spending this year alone at the federal level will be equal to $8,250 per taxpayer. This compares to $1,700 per taxpayer in 1967, the year this Prime Minister took office. To put it another way, federal government spending is now more than six times greater than it was when Mr. Trudeau first came to power and 15 times greater than the amount spent in any of the war years. That is a frightening thought, a frightening amount.
For most of us, a budget is supposed to be a plan which limits expenditures so that they match up with revenue, and expenses should not exceed income. However, that ancient, solidly based philosophy no longer seems acceptable to Ottawa's bureaucrats or politicians.
As I listened to the budget speech of the Minister of Finance and to the apologist today for the finance minister, the hon. member for Charlesbourg (Mr. Bussieres), I could not help but be reminded of the story entitled "Alice in Wonderland". Just imagine the scene in the House of Commons being played by people with different names. First there was Alice. Alice must be the Canadian people who have fallen through the rabbit hole and are watching a band of strange people do very strange things. There was the rabbit that led us down the hole. He is dressed in a very natty suit, wearing a rose in his lapel. He must be the leader. Then there was the finance minister. He must be the white knight who told us in November that four times five was ten and one-half. He has now corrected this to mean $19.6 billion for his budgetary deficit. The present Auditor General, Kenneth Dye, suggests it will really be closer to $22 billion. The Queen of Hearts who stole the tarts must be the energy minister who has stolen the natural resources from the people who developed them. Tweedledum and Tweedledee must be the Minister of Industry, Trade and Commerce (Mr. Gray) and the Minister of Justice (Mr. Chretien), who supported the Foreign Investment Review Agency and drove out many potential foreign investors that may have established industries in Canada and provided employment for our people.
The cast of the characters is vast. There was the mouse and the duck and the crab and the caterpillar and kings and queens and knaves. I could go on and on, but I know you will remember Mr. Speaker, some of the happenings, such as the Mad Hatter's tea party. You will recall that in the end Alice wakes
July 19, 1982

up and finds that she has been dreaming. Do you think, Mr. Speaker, when this is all over and the Mad Hatter's party is finished, which is when this government falls, that the Canadian people will wake up and realize that it was not a dream, that it was all too true?
In truth, the budget and this borrowing bill have left Canadians feeling somewhat like a burst balloon. Their hopes for the future have evaporated into thin air. Certainly any hope for interest rate relief evaporated when the government announced its deficit projections were wrong by $10 billion.
By the end of this summer, competition for money in Canada's capital markets will most likely drive the prime rate up to 20 per cent or more. In fact, with the federal government going to the money markets for at least $1.5 billion every month for the next 12 months, I predict that interest rates are likely to go through the roof.
Canadians have always believed, at least up until recent months, that this country had a great future. I still believe that Canada and Canadians have a great future. I also know that that future can be realized only if we place a new federal government in Ottawa that adopts new directions and restores confidence to Canadians in their government and in their country.
The secret to our present disastrous and, to use the Prime Minister's own words, crisis economic situation is the complete lack of confidence and trust that Canadians now have in their government. From Atlantic Canada to the tip of British Columbia and then on up to the Yukon and the Northwest Territories, the Canadian economy is laid waste. On July 9 it was quite a shock to me to sit in my seat in this House and listen to the hon. member for Yukon (Mr. Nielsen) point out that 100 per cent of the population in two towns in his constituency, namely Elsa and Faro, were laid off. Over 600 families in the Yukon are affected. The employment minister's only answer to the hon. member's request was that he was aware of the problem.
Business bankruptcies in Nova Scotia, according to The Chronicle-Herald of Wednesday, July 7, are up by 20 per cent this year over the same period in 1981. What do we find on the national average? In the July 14 Montreal Gazette we read:
Canadian companies forced into bankruptcy in the first half of this year went down owing more than $1 billion-more than double the amount in the corresponding period last year, the Department of Consumer and Corporate Affairs said yesterday.
Those are not Tory figures. Those are Liberal government figures, figures provided by the Ministry of Consumer and Corporate Affairs.
In the first six months, 5,383 Canadian companies went bankrupt, 1,451 more than a year earlier.
Surely we must ask why this is happening. It is because Canadians have been betrayed by the Trudeau administration, betrayed with respect to economic policy, betrayed with respect to energy policies, betrayed with respect to constitutional policy, betrayed with respect to federal-provincial policies and betrayed in our dealings with the outside world.
Supplementary Borrowing Authority
That is why we are in this mess. On January 12, 1980, the Right Hon. Mr. Trudeau, then leader of the opposition-


Mr. Deputy Speaker:: Order. With all due respect, the formal reference to a member of this House is either by function or constituency. This is the third time the hon. member has referred to the Prime Minister (Mr. Trudeau) by name.


Lloyd Roseville Crouse: Thank you, Mr. Speaker. I was referring to him at that time because he was then the leader of the opposition. At that time he outlined his economic program to the electorate in Toronto, stating "We have an economic program for the eighties which will enhance dignity, create opportunities and provide security."
Thirty months later the Canadian people are quite rightly asking, where is that program? The tragedy of the years under the right hon. member for Mount Royal is how we have wasted and are still wasting our potential. I am convinced that Canadians want to see things get better than they are at present and that they could bring this about if they only had a government which would help and not hinder them. The present economic crisis, the chaos, the lack of confidence of Canadians, the frustration, the anger and the despair are not caused by the Canadian people and not by any lack of resources in the second largest land mass in the world, nor by any lack of opportunities but, rather, by a lack of government leadership, by wrongheaded policies, by arrogance, by a lack of knowledge at the top and by the smugness of the people who have been too many years in office.
I have watched this power beget power over the years, but the present situation does not have to be. The answer lies not in our stars, not in Germany or Japan or the United States- the favourite whipping boy of the Prime Minister-but, rather, in this government, a government which has failed Canada miserably.
Our economic problems are not caused by U.S. interest rates. They are not caused by outside forces we cannot overcome. They are caused, if I may say so, by a weak Canadian economy which now provides us with a weak Canadian dollar, all as the result of 14 years of wrong, self-indulgent and politically inspired economic policies. It is people like the Prime Minister, the Turners, the Macdonalds, the Bensons, the Chretiens and the MacEachens who have given us our high interest rates at the 18 per cent to 20 per cent level, our unemployment rate at the 11 per cent level-some 1.3 million people together with another 410,000 additional persons calculated by Statistics Canada to be the number of the hidden unemployed-and our inflation rate year after year, which is now over 11.5 per cent. These men gave us our depression. Our productivity has decreased for four years in a row, and our real wages have been down for four years in a row.
What does the July 12, 1982, editorial in Maclean's have to say under the title "Party or country-which will MacEachen bankrupt first?" It reads:

July 19, 1982
Supplementary Borrowing Authority
The business community's reaction to Allan MacEachen's budget was swift and vicious: share prices on the Toronto Stock Exchange plummeted 40 points on the morning after, wiping out $2.9 billion in paper profits during the first 60 minutes of trading. Within the same hour ... the Canadian dollar dropped nearly a full cent... These stock market losses came on top of the slide that has cut $66.25 billion out of stock prices in the past year.
Over the years I can well remember the Liberals saying at election time: "Tory times are hard times; vote Liberal." In retrospect, as I look back over ten federal elections and some 25 years I must agree that when my party was in power Tory times were difficult times. They were difficult because we had to deal with the economic wreckage the Grits left behind them. However, in their lust for power, the Liberals, along with their New Democratic pallies, defeated the minority Conservative government and found themselves back in power after making misleading promises about lowering gasoline costs. This time the Liberals have to try to clean up their own mess. Grit times today are grim times for everyone to see and all to experience, and it is a situation which will not be forgotten too soon by all Canadians.
In considering the issues, we all know that Canada's economy is influenced greatly by the outside world and that much of the outside world is also facing economic difficulties. But clearly our lack of leadership, direction and policy on the part of the party in power has seriously worsened our economic situation.
What about our inflation? In my opinion our inflation has been caused in large measure by a complete lack of government restraint in spending and in revenue-collecting since 1972-73, resulting in government debts, which total in excess of $77 billion over the ten years ending in 1981-82. The deficit for this year is predicted at close to $20 billion, while Maclean's, as I said a moment ago, says it will reach at least $22 billion in the fiscal year beginning April 1. All through these years the fiscal policy of the government has ignored the monetary policy of the government and the Bank of Canada, so that the tight monetary policy has not succeeded in containing inflation. Every year there has been ever-increasing borrowing by the government, competing for funds with the private sector, and in 1982-83 government spending on a national accounts basis will increase by an estimated 22 per cent over last year. The second largest spending envelope of the federal government is now in the payment of interest on our debt charges, which the government says will cost some $17.7 billion this financial year. One tax dollar out of every four is now used to service the government's debt, compared with one tax dollar out of every nine only eight years ago.
The government cannot say that it was not warned about this economic catastrophe. When I served as chairman of the Public Accounts Committee the new auditor general at that time, Mr. James Macdonell, stated in his 1974-75 report that the government was losing, or was close to losing, control over the public purse. That is strong language from any auditor general, but coming from its own auditor general, the government should have altered the course of its ship of state before it landed on the rocks of fear, despondency and economic collapse. However, unfortunately no one on the opposite side
was listening. No one wanted to listen, and now that the ship is foundering, all the government can do is to look for scapegoats and try to lay the blame everywhere but the one place where it rightfully belongs. I say to hon. members opposite that if the government is serious about battling inflation, the government must give the public an example and must restrain and discipline itself if it wishes the people to restrain and discipline themselves. But this government to date has only carried out what I call cosmetic changes, and it is not fooling anyone.
How can hon. members opposite say that they are practising restraint when the "one billion" white elephant, Mirabel, continues to lose money at the rate of approximately $1 million a week? How can hon. members opposite justify their claims to restraint when they are purchasing new Challenger jet aircraft at a cost of $27 million? They cannot even find the funds to rebuild the fishermen's wharf at Riverport, Nova Scotia destroyed some two years ago and help re-establish a viable fishing industry at that port. How can hon. members opposite say they are practising restraint when they spend yearly some $225 million on their own public information and advertising budget, not to tell the people what they are doing but to try to hide from the public what is happening in Canada? Hon. members opposite spent $300,000 for a lively bash on the day the Post Office became a Crown corporation and spend $500,000 each year to give new briefcases to the public servants of Canada. They then have the gall to tell this House they are practising restraint! I say to all hon. members opposite that they do not even know the meaning of the word.
In the patronage area of spending, on government services alone spending increased from $4 billion in 1980-81 to $4.7 billion in 1981-82, an increase of 17 per cent in government patronage for lawyers and other fees. Where were the 6 per cent guidelines then? Where were the 6 per cent guidelines hon. members opposite now impose on some 1.2 million senior citizens who are singled out to pay for the mistakes of the government?
To complete the destruction of the Canadian economy, this administration, without any authorization from the Canadian electorate, instituted a constitutional war with the provinces which occupied most of 1980 and 1981. Hon. members opposite destroyed confidence. They failed to reach oil and gas agreements quickly with the producing provinces. They caused delays so that we have lost the Alsands tar sands plant and the Cold Lake project. They caused delays in the development of the Hibernia oil field off the coast of Atlantic Canada because of their determination to control and manage these resources. Then the Right Hon. Prime Minister ended all that with a declaration of war on the provinces by saying that co-operative federalism no longer exists. On January 12, 1982, the Right Hon. Prime Minister confirmed this declaration of war on the provinces by ending any attempt whatsoever at co-operation through the former DREE department. We now have DRIE instead of DREE with the Minister of Industry, Trade and Commerce (Mr. Gray) at its head. There is a megaprojects coordinator for each province, although there are no signs-
July 19, 1982

certainly not in my province-of any megaprojects to coordinate.
The damage of all this to our economy is obvious. There can be no confidence or trust upon which an expanding economy can be based when the federal government is entangled and engaged in such destructive, vicious, uncaring, unheeding and arrogant policies.
When the Minister of Finance (Mr. MacEachen) brought in the budget on November 12, 1981 he said that it had three themes: restraint, equity and economic renewal. On each of these grounds his budget was a complete failure. On September 9, 1980, speaking in Halifax, the capital of my province, he said it was in order to create jobs, improve living standards and promote greater equity that he took on the position of minister of finance. In light of what has happened since that time, I ask in all fairness how he can continue to hold on to that position!
We are sometimes asked about alternative policies. Every once in a while we read in the media that the Conservative Party has no alternative policies. Certainly we have no alternative policies like those proposed by the leader of the NDP who suggests that a magic wand be waved so that interest rates in Canada be reduced by 5 to 10 per cent. We know that such a step would mean wage and price controls, exchange controls and total state control of every aspect of our lives. The answer, of course, is not that simple. What is needed is more long-term changes. 1 can assure the House that within six months of taking office, my party would start the Canadian economy well back on the road to growth and prosperity. We did it in 1957 and in 1958, and we can do it again.


Mr. Sargeant:: What was the state of the economy in 1962?


Lloyd Roseville Crouse: I hear a squawk from the NDP, Mr. Speaker. 1 never interrupt any of their speakers, ever, and I do not intend to be interrupted by them. They should sit quietly and make their own speeches in their own time.


Terence James (Terry) Sargeant: Don't tell lies in the House.


Lloyd Roseville Crouse: I am not telling any lies. I consider that an unjust attack on me personally.


Mr. Deputy Speaker:: The hon. member for South Shore (Mr. Crouse) has the Boor, and 1 am sure other hon. members will pay him the respect that is due.


Lloyd Roseville Crouse: We got the economy rolling in 1957 and 1958, and we can do it again. Our alternative policies and thrusts can be seen in the budget of December 11, 1979. These thrusts are still basically right for Canada. 1 believe that we could, upon taking office-with a majority from the Canadian people- restore confidence to ordinary Canadians in the private sector by throwing out this rehashed budget introduced by the Liberals.
We would end tax harassment and government legislative discouragement to risk takers, the people who are so badly needed in our economy at the present time. A new budget
Supplementary Borrowing Authority
would be brought in within a reasonable period of time to settle the ground rules and outline and establish the framework for a two or three-year period, providing the stability that the business world needs for expansion and restoring the Canadian economy.
We would bring about changes in the present National Energy Program, and reduce the present discrimination against the foreign and the Canadian entrepreneur. A reduction in the tax burden on industry is also required to encourage Canadian exploration and development.
As a Nova Scotian, I personally believe that in Canada we have to utilize our maritime position, our Arctic resources and our tremendous coasts, lakes and rich continental shelf. We have to develop our own shipping fleet and focus attention upon our fishing industry. Our main objective should be the utilization and development of our resources on, in and under the waters that surround our vast shores. For all too long this government has engaged in navel gazing. Perhaps that is why the country is presently going belly up.
In my opinion, this government, as is usual with Liberal governments, confines its gaze to the bulging population residing in central Canada while the extremities of the country, especially the coastal regions, are neglected. I believe that the coastal shipbuilding industry, especially the east coast industry, with the discovery of massive offshore oil reserves, has fantastic potential. Billions of dollars will have to be spent on new vessels in order to develop the offshore resources in the next ten years. However, shipbuilding is a most unnatural industry, one that requires the most support of the central government if it is to be effective and successful. In most shipbuilding nations government provides shipbuilders with generous subsidies, tax breaks and investment allowances, but Canada does not provide any of these. In order to develop the industry in this international, cutthroat market, nations must have well developed shipbuilding policies and dependable financial arrangements for the benefit of workers and owners as well as builders. Canada has no such policy. Shipbuilding in Canada is an industry which has important local as well as regional implications, but unfortunately the government has failed to catch the vision of the opportunities the industry could offer the nation. With federal policymakers preoccupied with troubles at the nation's centre, it appears that we will be passing up another fantastic opportunity on our east coast. That lost opportunity could take with it the dream of the Canadian merchant marine. Three times in our history the Canadian nation has developed a sizeable merchant marine, and each time federal indifference has wrecked that fleet.
It is this indifference to Atlantic Canada's needs that is the real core of some of our problems. We need policies that would strengthen the various local industries. Just sending money into an area for what I call cosmetic, make work projects, is not the answer. For example, the federal and provincial governments have spent millions of dollars to keep the Cape

July 19, 1982
Supplementary Borrowing Authority
Breton steel industry alive. A long-term, positive shipbuilding program could be the catalyst that would set the industry on the road to recovery.
It is estimated that three million tonnes of steel will be needed to manufacture ships for Canadian needs within the next decade. All that is needed to bring this type of development about is a national policy and a national will to carry it out. Without a national long-term policy and direction, companies will not make the investment that is required for development.
It would take investments of $20 million to $100 million per year to keep present Canadian yards competitive with new technologically advanced yards in other nations. Our competition is receiving tremendous help from subsidies. British ship builders, for example, receive 30 per cent, the French receive about 25 per cent, while we in Canada receive about 9 per cent. As a matter of fact, foreign buyers are given a better break when buying Canadian made ships than Canadians are. The government will provide financing at 8.75 per cent for a foreign buyer, but a Canadian buyer who wants to build a ship must go to a bank and pay interest rates as high as 20 per cent or more.
Canada is the only nation in the world with a shipbuilding potential of any consequence which does not have a program to assist its nationals to finance the acquisition of ships locally.
As Conservatives, when we form the next government-and that will be as soon as the next election is called-we intend to change this policy and stimulate our shipbuilding industry for the benefit of offshore use as well as for the benefit of the fishing industry. As Conservatives, we will once again welcome foreign investment.
1 cannot help but wonder about this government's concern about foreign investment, Mr. Speaker. 1 would invite any member of the government to come to Nova Scotia, to Bridgewater, which is just 12 miles from my home town of Lunenburg. They should visit the Michelin plant there, which is the result of French investment. Anyone who remembers the town before Michelin and sees it as it is today will realize the tremendous benefit of foreign investment in the Canadian economy. In my opinion, our need for capital will be immense for the rest of the twentieth century. That need simply cannot be met without foreign investment and foreign loans.
We would make our preference for private-sector ownership and management of the economic system very clear, with policies devised to give room to take risks, to innovate and to grow. The operations of Crown corporations would be reviewed and reduced so long as the private sector could fill any gap that might occur. I believe it is well past the time for a thorough and proper review of our economic future and our relations with our best friend and customer, the United States. The problems that relate, for example, to the boundary issues alone between our two countries, as well as fishing agreements-have been allowed to drift, Sir, for far too long. What may very well have been resolved at the political level now seems destined to end up in continued disputes and bitter controversy between our two countries, which can only be harmful to our own development. I am convinced that within a
very short period of time we could turn around the Canadian economy dramatically and restore it by restoring confidence and trust in ourselves, our government and our nation. It can, Sir, and must be done.
Obviously there are just two clear choices for Canada. The Conservative Party believes in a federal Canada, a federal state with 11 strong governments. It believes in the private sector. We believe in private initiative and private ownership of the economy. We believe in a mixed-market economy, and in the fact that none of us will retain any human or personal rights unless we have a largely privately-owned economic sector. We believe in co-operative federalism and the partnership of our five great regions.
The alternative is the Liberal-NDP alliance, which obviously does not believe in a federation for Canada, an alliance which is anti-province and which is for a centralized, Unitarian government for Canada. It is an alliance which ignores our vast land, our varying regions, and the need for unity and diversity. The alliance is anti-private sector and anti-private ownership and initiative, and against the right to ownership of private property.
Both of these parties, for example, voted against our proposal that the right to ownership of property be included in the Charter of Human Rights, just as it was in the Diefenbaker Bill of Rights, and as it is in other countries. Life, liberty and the right to property was our proposal, but the Liberal-NDP alliance voted together to remove the guaranteed right to ownership of property in this land. Let us never forget what that alliance brought out in the Charter of Rights.
The Liberal-NDP alliance is calling for the centralization of all political and economic power here in Ottawa. It is pro government ownership and control. It is pro granting of enormous supervisory and regulatory power to the bureaucrat, who becomes not dependent on the people of Canada but, rather, on our master, who takes the fruit of the worker's labour while fashioning more burdens for the workers to carry.
1 cannot support that type of government, and I hope the Canadian electorate will recognize what they are voting for when they next go to the polls.
In conclusion, Mr. Speaker, I say that we must build a Canada where people respect the land, a Canada where people respect the sea and the environment, where we do not squander and abuse our good fortune; a Canada where we respect the law and the rights of others; a Canada where people respect and reward initiative, where excellence is encouraged, and where the work of every individual is recognized. That is the type of Canada that I wish to see, and that is why I support the amendment moved today by the Right Hon. Leader of the Conservative Party (Mr. Clark).


Mr. Paul E. McRae (Thunder Bay-Atikokan):: Mr. Speaker, it is a pleasure for me to speak on this bill today. It gives me an opportunity to talk about some of the myths created as a result
July 19, 1982

of the most recent budget, and some of the ideas circulating about spending gone wild, ideas which are encouraged by the opposition. However, there is very little in the nature of solid suggestion as to where we must go, other than that we should get rid of the NEP or abandoning FIR A, which a very large number of Canadians want to retain and rightly so. One of these myths is that the cost of operating government is the major factor in all of our problems. If government costs were down, then things would change. Of course, when we talk about government costs, we talk about the operation of the government, and that is the myth which has been created. Another myth has to do with the fact that Canada alone is suffering in the world. No other nation is facing the same kinds of problems. Of course, it follows naturally that Canada is becoming a socialist country, if you listen to the speakers from the other side. We are becoming great socialists and therefore we are doomed.
I suppose, Mr. Speaker, the hon. members opposite, even though they call us socialist, would not accept the fact that President Reagan is a socialist, but before 1 have finished speaking I hope to convince the House that President Reagan's government in the U.S. is in just as bad or worse shape than ours. So this is a world problem. It is not a simple problem, or one that is going to go away simply because of what we do in Canada. But at least I think it will help solve the problem if we start understanding it a little.
Let us talk in positive terms and try to dispel some of these myths. The kind of vituperation and venom constantly coming from the other side, especially from the Leader of the Opposition (Mr. Clark), who is constantly picking at these petty points, does not solve the problem, so let us have a look at this question in more detail.
The most immediate question in terms of the budget is, why did the deficit, which was shown at about $10.6 billion in the November budget, rise by $9.1 billion? Of course, the opposition stands up and says, "Government spending gone wild." That is their answer. Of course, the media picks it up and the whole country thinks that is the answer. But is it? Let us look at that $9.1 billion. It can be divided into two parts: additional spending, and reduction in revenue due to a world recession. How does that divide up? Well, one dollar in every five is additional spending. The $4 is a decline in revenue. It is not spending gone wild, it is the fact we are in a world recession and there is a major decline in revenue. If hon. members cannot believe that from the so-called socialist government, let us have a look at the American government. Revenues for April and May in the United States indicate that this year's budget, the one which finishes in the fall of 1982, will be in deficit by $124 billion. Why? Because the revenues have fallen off significantly in the months of April and May due to the world recession. That recession was not caused by this government, it was a worldwide recession principally caused by the Reagan economic policy in the United States.
Supplementary Borrowing Authority May we call it six o'clock, Mr. Speaker?


Mr. Deputy Speaker:: It being six o'clock, 1 do now leave the chair until eight o'clock this evening.
At 6 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
The Acting Speaker (Mr. Blaker):: When the House rose at six o'clock, the hon. member for Thunder Bay-Atikokan (Mr. McRae) had the floor.


Paul Edmund McRae: Mr. Speaker, I mentioned earlier that I want to deal with several myths that have grown up around the budget which are creating a great deal of mayhem and concern among Canadians, and I do not think that should necessarily be so.
The first myth has to do with the notion that the $9.1 billion additional deficit as between the November budget and the June budget is a sign that government spending has gone wild. Of course, this particular myth has been fostered by the Tories particularly. Every day you find horror stories of government spending. Most of them are half told. The other half you do not quite get. The myth is still there and most Canadians believe that the government has suddenly spent $9.1 billion more than it estimated it was going to spend not more than eight months ago. Of course, this is not true. If we look at the $9.1 billion, we find that something in the order of-


Ian Deans: I rise on a point of order. Looking from your vantage point, Mr. Speaker, I was wondering whether you thought we had a quorum.


The Acting Speaker (Mr. Blaker):: I had some difficulty hearing the hon. member's words. 1 realize he asked a question about the quorum. I also have the impression that he was not calling a quorum. Perhaps the hon. member for Hamilton Mountain (Mr. Deans) could indicate to the Chair again what he was commenting on.


Ian Deans: Mr. Speaker, I wondered if perhaps from your vantage point you thought we had a quorum. 1 fail to see one.


The Acting Speaker (Mr. Blaker):: The hon. member for Hamilton Mountain should realize that the issue of whether or not there is a quorum present is a matter for individual members to call. It is not the responsibility of the Chair to persist in a count from moment to moment. If the hon. member wants to call a quorum, I will use the procedures that are relevant to that. If he simply wants to make an observation with respect to whether or not there is a quorum, then I could not make any comment in that regard.


Ian Deans: Mr. Speaker, further to my point, 1 would ask that you take a count to see whether we have a quorum.

July 19, 1982
Supplementary Borrowing Authority


The Acting Speaker (Mr. Blaker):: i will take that reference by the hon. member for Hamilton Mountain to be a call for quorum. Is that what the hon. member wants me to do?


Ian Deans: Yes, Mr. Speaker.


The Acting Speaker (Mr. Blaker):: The hon. member for Hamilton Mountain has now called a quorum. I want to be clear about that. Is that correct?


Ian Deans: Yes.


The Acting Speaker (Mr. Blaker):: The hon. member for Hamilton Mountain has indicated he has called a quorum. 1 will explain to hon. members who are present in the House at this point that there is no mechanism by which the Chair will recognize points of order or questions of privilege. There is some debate as to whether or not that is the most appropriate way to proceed. But as far as I am concerned, that is the way in which I will proceed. I will not recognize points of order or questions of privilege.


Mr. Fisher:: Mr. Speaker, I rise on a point of order-


The Acting Speaker (Mr. Blaker):: Order, please. I have just finished saying that I will not recognize a point of order or a question of privilege. There will be no intervening procedure whatsoever while I count quorum. 1 will ask the deputy clerk of the House to assist me in determining the number of members present. Those hon. members who are here should understand that there is no difficulty whatever in hon. members entering or leaving the chamber. Further, we will count those hon. members present by row. The deputy clerk of the House and myself will take note of those members who are present row by row. Any member may enter the chamber and any member may exit at any time according to his wish.
I will now ask the deputy clerk of the House to count the hon. members present.
And the count having been taken:


The Acting Speaker (Mr. Blaker):: The Clerk of the House indicates to the Chair that there are 24 members of the House who are present, including the occupant of the chair. Therefore there is a quorum and the chair will now recognize the hon. member for Thunder Bay-Atikokan (Mr. McRae).


Paul Edmund McRae: Mr. Speaker, 1 think we lost about five minutes in that exercise. I hope that will not be part of my time. Could I have a ruling on that?


The Acting Speaker (Mr. Blaker):: The Chair is not disposed to make rulings at the request of hon. members; in so far as the hon. member for Thunder Bay-Atikokan is concerned with respect to the time available to him. It is not a question of whether or not that additional time is available. It is more a question of whether or not he has the usual 40 minutes, and he does.


Paul Edmund McRae: Mr. Speaker, the point 1 was trying to make is that the increased government deficit is not, in a major way,
caused by increases in spending. The actual facts are that 79 per cent of all increase in the deficit is caused by decreases in revenue brought about by world recession. Other governments, such as the American government, are finding exactly the same thing happening. Between the two budgets only one dollar in five of the increase in the deficit was caused by an increase in government spending. Half of that was caused by spending which did not happen in the last year, and the other half was mostly caused by additional spending because of the recession.
The Canadian public is not aware of the essential point. It has not been made aware of it by the media; confusion has been sown by the opposition. The essential point is simply that four dollars out of every five of the increased deficit was caused by a decrease in revenue, a decrease in revenue caused by a world recession. That is a fundamental point for Canadians to understand what has happened. Government spending has not gone wild. It is the simple fact that we are in a world recession and revenues have fallen. I will demonstrate later how that has happened in the United States as well as in Canada.
The second myth is the notion that all government spending is in the same order. Let me look at that. There are two basic kinds of spending. The first one is what we call transfers, that is, transfers from the federal government to other governments in terms of health, welfare and so on. I am referring to these kinds of transfers to provinces and to municipalities. There are transfers to people in terms of old age pensions, various forms of pensions, children's allowance or family allowances. There are transfers to corporations in the form of subsidies. There are transfers to funds like the Western Development Fund. There is a whole series of transfers. Also there are transfers to people who own Canada savings bonds, from whom the government borrows money. These are transfers from one Canadian to another. Only about 1 per cent is actually transferred out of the country.
These transfers represent 78 per cent of all federal government spending. Another 2 per cent is in capital spending; in other words, when one acquires capital and builds buildings. Only 20 per cent is in operating the government, such as running the Post Office, the Department of National Defence and all other areas of government. The costs of transferring that money are all in that 20 per cent. When we talk about governments taking from the people, we are talking about the area of goods and services or 20 per cent of the spending which runs all government departments such as the Department of National Defence. That 20 per cent buys our planes and does many things.
If we are really looking at things in a thoughtful way and trying to find what are the answers, rather than making noises, making fun of the government, destroying the government or defeating the government, then we must look at these transfers in an intelligent way. How large is the $20 billion in terms of the gross national product? If I say that 1 spend $20,000 a
July 19, 1982

year, it does not indicate anything about what that does to me. For example, if I make $40,000 per year and I spend $20,000, I am doing very well. If I make $10,000 per year and I spend $20,000, than I am doing very badly. It is the same with a country. The gross national product of this country for next year will be around $359 billion. That is the gross national product. The value of all goods and services, everything done in the country, will be $359 billion.
The Government of Canada, in terms of goods and services, is taking $20 billion out of that $359 billion. The other $70 billion which the government will spend in 1982-83, the year about which we are talking, the year which the borrowing is for, is transferred from one Canadian to another. It is not taken out of the economy.
How does this compare in terms of the amount spent on goods and services as a percentage of the gross national product? It is about 5.2 per cent of the gross national product. Until approximately 1953 that was about 10 per cent of the gross national product. The amount the government spent on goods and services was about 10 per cent of the gross national product. Then it started to decline, and it declined until about 1965 when it became 6 per cent of the gross national product. Since 1965 it has stayed around that level. It is 5.2 per cent, which is not a very large portion of the gross national product.
1 remind hon. members that the other $70 billion that the government will spend in 1982-83 will be transferred from one Canadian to another. It may be suggested that we are transferring money from the wrong Canadian to the wrong Canadian. 1 believe that the question of who gets the transfers is what we should be considering, and not ascribing this entire amount to government spending. If one were to listen to the opposition, one would think that the Government of Canada is taking 25 per cent of everything away from Canadians. That is not the case. The government is taking 5.2 per cent of the gross national product from Canadians. While it takes a lot more than the 5.2 per cent, it is transferred back. All but 5.2 per cent is transferred back, and I think it is very important for Canadians to understand this.
Another myth is that we are in debt such as we have never been before. This myth arises from a terrible distortion, that is, that this borrowing bill, is creating a debt situation which has never been seen before by Canadians. The net national debt, which will be approximately $200 billion or $300 billion by next year, is approximately 30 per cent or less of the gross national product. While this sounds like a large amount of money it should be compared to that in previous years. In 1926-27 the national debt was 45 per cent. In the middle of the depression it went up to 66 per cent. At the end of the war it was 109 per cent of the gross national product. In the 1950s it was in the range of 30 per cent to 35 per cent. Now, in 198283, it is at 30 per cent.
Is that something that Canadians cannot live with? Canadians are being told by the opposition, principally the Tories, as well as the media, that we are in a doomsday situation and that we cannot handle this kind of debt. However, 80 per cent
Supplementary Borrowing Authority
of all that money which the government spends is simply being transferred from one Canadian to another.
As 1 said previously, we should be discussing in the House how and where that money is transferred. I would like to hear this point raised in other speeches. This is the key factor, not the amount itself. It is not an amount which Canadians cannot live with.
1 receive many letters these days from what I suspect is a group which travels around the country writing up these letters because they all seem to be the same. I know that other members on this side of the House are receiving the same letter which urges me, as an MP, as well as my colleagues, to cross the floor. Each of these letters tells us that we are a socialist government which is destroying this country and which is the cause of our problems. These letter writers write as though no other country is having problems and Canada's problems are our fault because we are socialists. I do not know where these people get that idea but that is what they are saying in those letters.
Therefore, I would ask hon. members to examine another country, the United States. 1 do not think that any of these letter writers would call President Reagan a socialist. Some of them might, but I fail to see the probability of that particular appellation.
Let us review the situation in the United States to see if there are any comparisons between the problems we are facing and the problems facing the American government under so-called Reaganomics. These figures are difficult to compare because our fiscal year begins on April 1 and ends on March 31, whereas the American government's fiscal year begins on October 1 and ends on September 30. However, it appears that our deficit in 1982-83 will be approximately $19.6 billion; the United States deficit will be somewhere between $150 billion and $160 billion. These figures have been steadily increasing lately, and an interesting reason has been cited in The New York Times on July 11 where they said that the $9.7 billion surplus reported in April is so far below normal that it would be translated into $106 billion deficit at the annual rate, and May's 18.9 deficit would actually be more than $152 billion. The revenues are falling and falling in the United States. According to this article, their deficits for this year ending in September will be somewhere between $125 billion and $150 billion. Next year's deficit will certainly be in the order of $150 or $170 billion.
Let us use $150 billion as a conservative figure. In Canada, the gross national product will be $358.9 billion. The gross national product in the United States will be $3.1197 trillion. Our deficit as a percentage of gross national product, which is how we must look at it, is running at approximately 5.46 per cent. If we take the lowest figure, the American deficit would be 4.81 per cent. If we consider the figure of $170 billion, which many believe it will be, it will be approximately 5.4 per cent, roughly the same as ours. However, that is not what is so important. What is important besides the comparison in itself is the ability of these two countries to accumulate capital. And

July 19, 1982
Supplementary Borrowing Authority
they have indices that are called gross fixed investment. We can estimate that in the fiscal year 1982-83 Canada's growth in gross fixed investment will be $91.7 billion. In the United States it will be $551.8 billion.
Let us relate that deficit against the amount of capital that accumulates in the country in a year and we will see then which is more serious. The deficit as a percentage of gross fixed investment in this country in 1982-83 will be 21.3 per cent. It will be 27.2 per cent in the United States. It is a far larger deficit there in terms of the amount of capital that is accumulated. Of course, this is what makes for real difficulty with the American interest rates. Of course, I am talking about the United States which is a country operating under what is known as Reaganomics.
A number of members opposite, including the hon. member for Etobicoke Centre (Mr. Wilson), has said that if Reaganomics fail, we fail. This is a strongly held opinion on the other side. I hear many members talking about Reaganomics being the answer. Let us consider this further. Let us again study government spending on current goods and services. I had indicated that it was about 5.2 per cent of the gross national product of this country. That is the amount that the government actually spends on the post office and defence and other areas. In the United States that accounts for 8 per cent of the gross national product. The government of the United States takes that out of the economy, as opposed to transfers from one citizen to another. This factor is much more serious. The total government expenditures in 1982-83 as a percentage of the gross national product, which is what we really must consider, will come close to 25.2 per cent in Canada. This includes transfers. In the United States it would be 24.5 per cent, which is roughly the same. However, the major factor we must remember is that the expenditures on goods and services by the government is what is critical. We must continue to remember that the expenditures on goods and services in the operating of the government are critical. These expenditures represent 8.4 per cent of the gross national product in United States and only 5.2 per cent in Canada. These are just a few of the myths we hear from the opposition. I will read one newspaper excerpt which states:
After two years of high interest rates, the economy is virtually stagnant. Caught in a squeeze between high rates, falling inflation and weak sales, business is taking a beating. Bankruptcy figures are approaching the record highs of the Depression, investment plans are being shelved, millions of workers have been laid off with scant prospect of a quick return to the payroll. And despite all the battles ... to hold down Federal spending, enormous deficits still lie ahead, triggering worries in the financial markets about future inflation and generating continued upward pressure on long-term interest rates.
I ask you, Mr. Speaker, was that statement concerning Canada from the Edmonton Journal, or The Globe and Mail or the Montreal Gazette? No, it was an article entitled "The Troubled Fed Seeks a New Way" found in the front page of the business section of The New York Times of July 4, 1982. I left out the words "in Congress", just so that I could disguise its origin. So those in the opposition are saying that because
the government is socialist, it is the one which is destroying the country, yet if we sit down and read what is happening in the United States as reported in The New York Times, in The Globe and Mail and all the other Conservative newspapers in the country, we find that they all say the same thing. Since part of the deficit is caused by our energy costs and borrowing for energy transfers, let me just read a couple of statements: "It is predicted that by this time next year, 500 to 600 independent operators will conceivably have been forced out of business." Another one states: "Drilling rigs are stacked, or out of service, all over the oil patch. The average utilization rate stands at around 65 per cent compared with almost 100 per cent last year". It goes on to say: "Other service companies are awash in excess capacity or have seen their order books stripped bare."
These are just some of the statements. Do they come from a Canadian newspaper or magazine? No, they do not. They come from Fortune magazine, the January 14 issue. They are saying the exact same things. Do not forget that it was not the National Energy Program which created this article. The program has nothing to do with the American oil industry. We find that Standard Oil of California prospects tumbled 65 per cent in the first quarter, Mobil was off 49 per cent, Texaco was off 44 per cent, Phillips Petroleum dropped 44 per cent, and so on. Canadians are being fed this nonsense by the opposition, that the country is in a mess because we are socialists and have turned everything over to government. When hon. members in the opposition say this, and when they feed this to Canadians, and when Canadians believe it-


Mr. Nystrom:: You are not socialists. I do not believe it.


Paul Edmund McRae: -they are completely ignoring what is happening in the United States. No one will tell me that Reaganomics is a socialist form of government, but they are having the same problems.


Lorne Edmund Nystrom: You are a running dog capitalist.


Paul Edmund McRae: I have a great deal of difficulty with that kind of thinking. The government should refute that kind of nonsense.
I would like to take those points in order again so that we can make sure we understand them. The first point is that 80 cents on every dollar, $4 in every $5, or 80 per cent of the increase of that deficit is caused by decreases in revenue, caused by a world recession.


Ian Deans: It is caused by unemployment.


Paul Edmund McRae: That is irrefutable. No one will say that that is not the reason.


Ian Deans: I will say it is not the reason. I say right now that that is not the only reason!


Paul Edmund McRae: In 1982, 78 per cent of all money that the government spends, nearly $4 out of $5, is transferred in one form or another. Less than 2 per cent is in capital spending and the balance of 20 per cent, just a shade over 20 per cent,
July 19. 1982

$1 on every $5, goes to goods and services or to government itself. That is what the government takes out in national defence and so on.
In 1982, as a percentage of gross national product, the national debt will stand somewhere in the order of 30 per cent, a much lower figure than we have experienced in the years from the early 1920s to today. All these figures compare very well. The United States spends 8 per cent of its gross national product on goods and services, while we spend only 5.2 per cent. I tell the Canadian people this fact to show that this is not a record of wild spending, a ridiculous free-for-all in terms of spending, with the combination of horror stories and so on. This is a sensible and sane set of numbers in a world recession. Those are the numbers that we will find in countries like West Germany, France, Italy and Britain. They vary from place to place because some areas are better than others, but we are all in this type of recession. If we do not get some action-


Ian Deans: From whom ?


Paul Edmund McRae: -particularly from the Reagan government, it will be very difficult for us to move ourselves. There are some things we can do, but we will be doing them-


Ian Deans: What do you recommend?


Paul Edmund McRae: -if the Reagan administration does not improve its pattern.
1 would like to close by suggesting that our eyes should be much more glued to what is happening in the United States, to an increase in defence spending over the next three years on a scale of about $130 million a year so that, by 1985, its defence spending will be $130 million more than this year. That will mean a tremendous increase of approximately 4 per cent in the gross national product of that country, not much more than that spent by our government in total for goods and services. The United States will also have to replace something like $200 billion in taxes that it cut, a good portion going to fairly wealthy Americans, and that would be scaled over three years. The United States government will have to find $330 billion per year by 1985 in order to keep its deficit down.


Mr. Huntington:: What do we have to find?


Paul Edmund McRae: We, as Canadians, are in a very difficult position because we live next to the United States and about 25 per cent of our gross national product is directed to trade with the United States. The government decided to bring in the National Energy Program so that we could become more independent of the American economy. The one thing we hear from the opposition is that if they were in power, they would get rid of the National Energy Program and, although they would not disband FIR A, they would make it more innocuous. Those are their major points.
One of our biggest problems is that the colossus of the United States is running up a deficit that could reach $250 billion. We are trying to be free of that. Those across the floor
Supplementary Borrowing Authority
ask us to disband our one chance of independence. How ridiculous can one get.


Mr. Elzinga:: Mr. Speaker, I rise on a point of order. It is obvious the member opposite is spewing garbage. Maybe he could clarify his statement and tell us who specifically asked him to cross the floor, because 1 am sure no sane person on this side would want him.


Paul Edmund McRae: 1 do not know who the people were. 1 must admit it would be insane for us to cross the floor. The hon. member and I are in agreement there. 1 cannot imagine joining a party which, if it formed the government, would disband the National Energy Program and get rid or at least make FIRA totally innocuous.
We on this side take a middle road. We are trying to work this out. The very things that will give us that kind of freedom to move in the future are the things that we on this side are doing. 1 am much more afraid of what is happening in the United States under the Reagan administration, which the hon. member for Etobicoke Centre and others have said is the model they would follow. I will be very much afraid if that government stays in power much longer.


Ronald Alexander Stewart: Mr. Speaker, it is a pleasure to enter this debate, particularly to follow the hon. member for Thunder Bay-Atikokan (Mr. McRae) and to explain why we call him a socialist and why it is a horror story. First, this bill should be called the "It's Ours" bill, the "It's Ours" borrowing bill. The $11 billion deficit is ours. It is like Petro-Canada, it's ours. It costs billions, but it sure is ours.
My leader spoke a few hours ago very eloquently on this bill and proposed an amendment which I fully support. That amendment simply says no to those opposite and no to profligate spending.
What we need in this country is a very simple solution. We need increased productivity. It can only come about by increased consumer spending and by increased exports. The budget has not addressed this and neither does this borrowing bill.
Just a few short months ago in July, 1980, this government was given $12 billion borrowing authority in Bill C-30. Bill C-59 of June 29, 1980, gave them an additional $14 billion. Bill C-l 11 in 1982 gave them $6.6 billion. Now Bill C-125 is going to give them another $11 billion because we do not have the horses over here to stop them. That is an unprecedented $43.6 billion borrowing authority by a government in one session. It is more than in any other session in history. As a deficit, as a proportion of national debt, it is a straggering legacy to leave to our children.
The interest burden is $723 for every man, woman and child in this great Canada of ours, or $1,864 per taxpayer on the figures that the member who just finished speaking says are very little. This is $17.7 billion on interest alone.
The November budget deficit was estimated to be $10.5 billion. Now, a mere eight months later, it is some $20 billion. What is it in reality? Is it $25 billion? How long is it before

July 19, 1982
Supplementary Borrowing Authority
this minister is back at the trough? Is anyone really surprised by 100 per cent? I do not think most Canadians are, not on the strength of the budget.
This government talks about restraint, but it talks out of both sides of its mouth. This is 6 per cent hogwash, balderdash. The poor secretary, the poor person at the low end of the scale will be limited to 6 per cent, but this borrowing bill represents a 12 per cent increase. Restraint must be examined, but not by profligate spendthrifts. This government has projected, and I say projected, financial requirements of $17.1 billion this year, but it already has $10.2 billion in borrowing authority, $3.6 billion unused from previous years and $6.6 billion from Bill C-111, as previously mentioned. Now, they ask for another $11 billion.
Another of those profligate Liberals by the name of C. D. Howe a few years ago used to say, "What's in a million?" These misappropriators are now bandying about "What's in a billion?" So the government now has $21.1 billion in borrowing authority, some $4 billion more than is necessary. We say that one half of that amount in their hands is too much, and our amendments will say so loud and clear. I would as soon trust these mishandlers with an extra $4 billion of hard-earned taxpayers' money as 1 would Jesse James with a bank deposit or Clifford Olson as my daughter's babysitter.


Ian Deans: That's crude.


Ronald Alexander Stewart: Over the past 14 years government spending has gone completely out of control, as pointed out by the reports of the auditors general. Spending climbed from $12.4 billion in 1968 at the inception of this government to $90.6 billion this year, an increase of 630 per cent. The member opposite says he does not find any difficulty with this. Since the Liberal re-election in 1980, it has risen by a paltry amount, just a teensy little bit, just an amazing 55 per cent, and those on that side just do not care. This bill is more than just another borrowing bill.
1 would like to look at the real underlying cause or our problem in this country. It was not caused merely by financial mismanagement. It was not caused just by high interest rates or by a falling dollar. It was caused by a philosophy that dates back some 14 years. This philosophy began by infiltration, indoctrination, mismanagement, lack of accountability and lack of innovation. The Canadian people finally, as revealed by the Gallup poll, caught on to what is going on and they lack confidence. They are angered and they are in despair, this is philosophically so because the leader of this nation is a leftleaning socialist ideologue who has no use for free enterprise, and that is something the hon. member for Thunder Bay-Atikokan had better take a close look at, and I shall tell him why he has led us down that slippery socialist slope to the unenviable financial crisis in which we now find ourselves. I am not standing here ad hominem and attacking a man. That is the first lesson we get when we study logic or morals, that you do not attack the man. However, I attack the philosophy of that man as a Canadian. I will tell the hon. member for
Thunder Bay-Atikokan why we know they are socialists over there. 1 quote the Prime Minister (Mr. Trudeau) as follows:
-it seems to me that the regime of free enterprise has shown itself incapable of adequately resolving problems of contemporary society. That's why I am personally convinced that with the upheavals inherent in automation, cybernetics, a nuclear energy, liberal democracy will not long be able to satisfy our growing demands for justice and liberty ... I believe in the necessity of state control-
Is that socialist?
-to maximize the liberty and welfare of all.
The erroneous, liberal idea of property helped to emancipate the bourgeoisie but is now hampering the march toward economic democracy.
I consider that socialism. He also said:
We haven't been able to make it work, the free-markets system. We've ended up with very high unemployment and very high inflation. We can't go back to what was before ... That means the government is going to take a larger role in running institutions.
I call that socialism.
A further quotation reads:
I should like to see socialists feeling free to espouse whatever political trends or to use whatever constitutional tools happen to fit each particular problem at each particular time.
As far back as 1956 he wrote that the best way to achieve change is by entering one of the old parties-hon. members opposite know what "old party" he was talking about-and changing them from the inside. He said that socialist policies can then be imposed on unsuspecting voters under the reassuring label of the old party. That is why we call hon. members opposite socialists. The Prime Minister also said:
Federalism must be welcomed as a valuable tool which permits dynamic parties to plant socialist governments in certain provinces, from which the seed of radicalism can slowly spread.


Mr. Allmand:: Mr. Speaker, I rise on a point of order. There is a custom in the House that if an hon. member wants to quote from a document, he should table it before the House. 1 ask that the hon. member table the document from which he is reading.


Ronald Alexander Stewart: Mr. Speaker, only ministers can table. These quotations just happen to be quotations from Cite Libre, Rassemblement and "Federalism and the French Canadians".
I would be happy to provide the hon. member with all the books. I have read them all.


William Warren Allmand: Mr. Speaker, I would like the hon. member to table the newspapers from which he is reading.
1 he Acting Speaker (Mr. Taylor): Will the hon. member for Simcoe South (Mr. Stewart) table the quotations from which he is reading?


Ronald Alexander Stewart: Mr. Speaker, I am sure Lubor Zink would be very happy if I were to table this newspaper.


William Warren Allmand: Oh, Lubor.


Ronald Alexander Stewart: I have a further quotation for the hon. member for Thunder Bay-Atikokan, who wanted to know why we call
July 19, 1982

hon. members opposite socialists. I am explaining it to him. Here is another quotation:
So long as socialism is to seek fulfilment through parliamentary democracy with its paraphernalia-
"Paraphernalia" yet.
-of parties and elections, there will be a constant need for the tactician, as well as the theorist. And both will have to be reconciled by the strategist.
The strategist sits across the aisle. The last quotation I have is the following:
And in terms of political tactics, the only real question democratic socialists must answer is: "Just how much reform can the majority of the people be brought to desire at the present time."
I think the Canadian people are at the breaking point at the present time, yet this government foists its so-called Canadian-ism and policies of so-called restraint when really it is socialism. This is a time when this country needs revitalization and a real shot in the arm so that we can again be proud Canadians. Canadians must reaffirm their faith and their belief in independent business. They must shout out against excessive borrowing such as we have today, excessive spending and excessive government control, which destroys all we should hold near and dear. The inalienable right to life, liberty and the ownership of property, as stated by Locke, have been passed down to us as God-given rights by our Creator, and nobody should have the right to destroy them. Why has the ownership of property been omitted from our Constitution? I ask hon. members opposite to think very hard about that and in the light of the statements of the Prime Minister (Mr. Trudeau) 1 have quoted.


Terence James (Terry) Sargeant: The Conservative premiers didn't want it in there.


Ronald Alexander Stewart: The Prime Minister does not want the ownership of property in the Constitution, and there is a bill in committee right now which gives the government the right to own property. The direction in which the philosophies of the Prime Minister lead is obvious. There are only two viable political systems left in this world, socialism-and eventually communism-and capitalism. Thank God we have lived successfully in a capitalist society, until just recently when the Liberal Party changed. The government is taking away our rights systematically-let us make no mistake about that; and hon. members opposite know this-while it spends, spends, and spends and borrows and borrows and borrows. And now it has the audacity to come in here and ask us for another $11 billion.
Let us remember that under communism the state owns and controls the means of productivity: factories, tools and farm products. It sets prices and wages and supplies the products which come out, whatever the price may be. That is what has been happening in Canada under the guise of Canadianization. That is what those quotations about socialism are all about. Has it made life for us one bit better? 1 would like to ask the people in the gallery if they have felt more content in the last two years. Now the government wants $4 billion more of our hard-earned taxpayers' dollars to waste.
Supplementary Borrowing Authority
Certainly over the lifespan of North America our free-enterprise system has provided more material goods and services than any other system in the whole world, but it is being eroded by this government which wants to spend and spend and borrow and borrow so that there is no wealth left, after a time, to provide the things to which we are accustomed, unless they are given to us by government. If this government goes much longer on its borrowing-spending spree and nationalization-


Terence James (Terry) Sargeant: Mr. Speaker, I rise on a point of order. 1 would like to ask the hon. member if he could tell us the difference between his definition of communism controlling wages and the recent piece of legislation which his party supported which controls wages in Canada.


The Acting Speaker (Mr. Taylor):: That is hardly a point of order.


Ronald Alexander Stewart: Once a socialist, always a socialist, Mr. Speaker.
What I was saying is that if we continue on this spree, we will all be equals like the commies; we will be equally poor.


Lorne Edmund Nystrom: You can be a commie; I am not.


Ronald Alexander Stewart: When the state controls the means of production, it controls economic freedom. If it controls economic freedom, it controls individual freedom. We then become what is termed serfs, vassals or slaves, and hon. members can ask any Russian in the U.S.S.R. all about that. That is the way we are heading, and 1 would like us to make no mistake about that. "Make government strong." "Make the people demand more of government." "Make them be subservient and beholden and demand more of government and less and less of themselves."
Let me quote the Prime Minister once again on this particular point, as follows:
Since the sum total of governments is the sum total of powers, the first task of a socialist is to educate all of the people to demand maximum service from all of their governments.
I do not want more government, and I came here, hopefully, to get rid of that fellow over there who wanted more government and more interference in Canadians' lives. 1 want less government, and that is what we on this side of the House stand for. 1 do not want to be a socialist or depend on government, and l do not believe most Canadians do either.
Why have we found ourselves in this dilemma? Again, there is infiltration. After the Prime Minister had been to China twice, Russia once and tried to row a boat to Cuba, he was invited, with Jean Marchand and Gerard Pelletier-the so-called three wise men-to join the Liberal Party. The three men spurned the offer. They were supporting the NDP and, in the pages of Cite Libre, poured terrible scorn on the then Prime Minister, Lester Pearson, for accepting nuclear weapons for Canada. However, in 1965 the three men changed their tune very drastically. Nationalism was sweeping Quebec, and there was no one in the federal Liberal Party strong enough to

July 19, 1982
Supplementary Borrowing Authority
turn the tide. The Prime Minister said, again in Cite Libre, while espousing his NDP philosophy-this was before his ascension; he is only the second person ever to do that:
I would have to point out in the strongest terms the autocracy of the Liberal structure and the cowardice of its members.
Those members are hon. members opposite.
I have never seen in all my examinations of politics so degrading a spectable as that of all these Liberals turning their coats in unison with their chief, when they saw a chance to take power .... The head of the troupe having shown the way, the rest followed with the elegance of animals heading for the trough.
He was talking about hon. members opposite. At another time he merely called Liberals idiots.
The hon. member talked about crossing the floor. He is one of 15 we would not want, but there are about 15 hon. members opposite of whom I can think that we would accept with alacrity. If they would cross the floor, we would then be rid of the horror show which was once the Liberal Party, until it was infiltrated by the present Prime Minister.
So much for historical fact and the true philosophy the Leader of the Government of Canada espouses. His sheep bleat docilely behind.
Let us get back to the excessive government spending and mismanagement of this great country of ours. The first thing was the National Energy Program. It too was alluded to by the previous speaker. He did not talk about the state control of the oil industry. He did not talk about the confiscation of land. He did not talk about lack of confidence in the world which destroyed our dollar after this happened. He did not talk about buying Petrofina at twice the price at which it was on the stock market, which gave the Minister of Finance (Mr. MacEachen) the title of patron saint of Belgium. 1 wonder if the government ever reads press clippings, particularly those from the United States financial news and not the garbage the hon. member opposite was quoting. Recently The New York Times called Canada's National Energy Program Canada's "self destruct" energy policy. This one, single program has done more than any other vehicle to weaken our economic infrastructure and make me have to stand here and say "no" to another $11 billion. It has resulted in lost jobs. Every Canadian knows that. You are from the west, Mr. Speaker, so you know about lost technology and lost investor confidence. With the stroke of a pen the government has Castroized the energy sector. It has changed the rules in mid-game. Canadians did not know that this was going to happen when they voted against an 18-cent excise tax only to get a 67 per cent tax on oil. What that accomplished was the Americanization of our oil industry. That is where our jobs went, where the drilling rigs went, where the technology and investment went. We are no closer to energy self-sufficiency now than we have been in the past ten years.
The regressive policies of this government have resulted in the cancellation of megaprojects which would have provided hundreds of thousands of jobs in the oil patch and manufacturing plants of this province and the Province of Quebec.
Had this party still been in government, Mr. Speaker, these projects would have been just about on stream now to help us
with energy self-sufficiency regardless of cost. We would not be dependent on the unstable supply of foreign oil.
In October, 1980, the national energy policy was introduced. Within one year the number of new oil wells had dropped by about 30 per cent. The number of oil rigs in use dropped by 25 per cent, production in the petroleum industry dropped from 1.76 million barrels per day to 1.61 million barrels per day, and prices soared and skyrocketed.
The article in The New York Times continues as follows:
What has happened since the National Energy Program in Canada and Reagan decontrol in the United States? For the First time in a decade, production of crude oil within the continental United States rose. Drilling of new wells increased 40 per cent. And the number of operating rigs hit a record high. Matching this increase, continued decreases in per capita consumption caused crude imports to decline by as much as half a million barrels a day.
In Canada, on the other hand, 1981 production of crude oil and natural gas fell 10 per cent and 4 per cent, respectively. Exploratory activities declined by 20 per cent in western Canada, as companies either moved to the far north to obtain production incentives payments or left the country entirely.
While $4 billion to $5 billion was spent on drilling, $7 billion left Canada as Canadian companies bought out foreign interests.
The outlook is for another 25 per cent reduction in well completions this year-
If the northern projects fail, as the $13 billion Alsands heavy-oil project did, then Canada will be importing half of its crude by the end of the decade. Since the United States should be importing only 20 per cent of its crude by that time, the Canadians will likely come to us for help in the next embargo. Let us not be of assistance, given that they have wrecked their markets and expelled efficient United States companies. Let them freeze in the dark.
The Wall Street Journal carried an article under the heading "Poor Canada". Mr. Speaker, do you ever bite your closest friend? They do, and that is what is happening as a result of the National Energy Program. The article had this to
say:
Mr. MacEachen and Mr. Trudeau are fond of blaming Canada's troubles on their big neighbour to the south. It seems that American credit markets cannot yield all the capital Canadians and everyone else in the world would like to borrow, so we all suffer from high interest rates. The budget deficit projected in the revised Canadian budget is a real shocker, equivalent to a $155 billion deficit in the American economy.
The U.S. is experiencing low inflation and high (by recent standards) unemployment. Canada is suffering both high inflation and high unemployment.
The reason is not so hard to find. The United States departed last year from the kinds of policies that generate stagflation, principally a continuing build-up of the tax burden after it is evident the economy is labouring under the existing burden. The U.S. installed policies to sharply reduce the tax rise. Canada's Liberals have been blithely piling on heavier burdens and, as the latest news shows, intend to keep right on doing it. Their expectations that some day their heavier taxes are going to reduce the budget deficit look steadily more hopeless as the deficit soars along with the taxes.
Obviously the people across the aisle have never read "The Decline and Fall of the Roman Empire" to see what happened back in those times. I wonder who The Wall Street Journal meant when it referred to Canada's "socialists"? Was it the wolves in wolves' clothing across the aisle or, was it-as in Churchill's reference to Attlee-the sheep in sheep's clothing to my left?
During the period when the Reagan government and Congress in the United States cut taxes and cut government spending, this mob across the aisle keeps raising taxes and
July 19, 1982

adding to a staggering national debt through deficit spending policies. Now it wants to borrow $11 billion more.
The Fraser Institute in Vancouver has published some very interesting Canadian statistics, Mr. Speaker. The institute's tax index shows that the tax bill of the average family has increased by 515 per cent since 1961. Bonds which the federal government issued to cover deficits are essentially deferred taxation-we all know that-since tax revenue must ultimately be raised to pay the carrying charges and redeem the principal. If you build in this deferred taxation, the Fraser Institute estimates that between 1961 and 1980 taxes increased by 619 per cent.
In 1980 the average Canadian family had an income tax bill of about $4,345 while other taxes-fuel oil, motor vehicle, sales taxes, property and, would you believe, amusement taxes, totalled almost $7,000 or 70 per cent of the entire tax bill per family. Most Canadians are not even aware of these hidden taxes which erode their disposable income and destroy the prosperity of Canada. Until they wise up to the facts of what this socialist government with its buddies to my left are doing and that people can spend their money better than governments can, we will be in the same quandary.
The government has concentrated so much time and attention on putting expensive and non-productive social programs in place that is has neglected the bread and butter economic policies which must generate the revenue it will later collect in taxes.
Let us look at some of those figures issued by the Fraser Institute again, Mr. Speaker. Where does the money go? The government has no idea how much it has squandered on things such as bilingualism training. An article in The Toronto Sun on July 18, 1982 by Douglas Fisher deals with the CBC and bilingualism. He writes:
There are 24.5 million of us, of whom 20 million are able to speak English, 7.4 million are able to speak French.
Last year English language network radio and TV cost $186 million.
Last year French language network radio and TV cost $145 million.
That is, it costs just 25 per cent more for the network to reach anglophones than francophones. If the service were alloted costs on a straight per capita basis, the spending on French services would be 250 per cent more than for English services.
There is another disproportionate tilt toward the French language service in money terms. Of its $792 million budget, CBC raised $131 million from advertising. Over 80 per cent of this was raised by English language TV.
Again, the moral: Bilingualism and keeping Quebec in Canada costs a lot of money.
He also points out that CBC TV is sending a crew of 90 to cover the Commonwealth Games in Australia while CBC Radio is sending ten people. We just need to check those figures against those for the Versailles Conference to see the profligate spending of this government.
Let us get to the crux of the matter, Mr. Speaker. In 198182 the government's bilingualism program cost $448,184,000 for a measly 6,075 person years. Where is the productivity in $400 million being spent on a program of languages? If we could suspend that for two or three years until we put our house in order that might be different.
Supplementary Borrowing Authority
The government is living beyond its means, Mr. Speaker. I could go on and on with a litany of government spending on social programs that do not make sense. Take universality, for instance. 1 suppose the Harold Ballards of this world who are drawing the old age pension deserve the same amount of money as the poor beggar in the street. I do not begrudge income security payments, nor does my party; we are proud of them, Mr. Speaker, but we question the manner in which they are distributed. I think they could be better and more economically distributed through a system of tax credits rather than universality.
What other government in the world spends more money on advertising than any private corporation? Is it $225 million or $250 million? How do we know? We now have a minister of propaganda, for the first time since Nazi Germany, who sits on the other side and spends this money calling it the Canada Unity Office, or some such name.
My colleague, the hon. member for Wcllington-Dufferin-Simcoe (Mr. Beatty), just elicited some interesting reports from questions he placed on the Order Paper. Between March, 1980 and March, 1981, the government paid out $3.5 million in taxi fares. Is that not just beautiful? Your government pays people's taxi fares, even though they have large expense accounts. Between 1980 and 1981 the government spent $16.7 million on telegrams, cables and other wireless communication. We have a 30-cent stamp, but that is another beautiful thing. You cannot post a letter from Barrie, in my riding, even guaranteed by the postmaster, after paying $2.15 to have it registered, and have it in Toronto in 48 hours; it takes four days.
This is a very hospitable government. A total of $10.4 million was spent on hospitality; food, booze and entertainment. That is the equivalent of 700,000 bottles of liquor. And those members are sitting over there talking about restraint, about 6 per cent. They are operating on 6 per cent brains. Prior to the 1981 Grey Cup they spent how much? They spent $8,950 for the first party, $17,250 for the next one and $72,650 for half-time. Beautiful stuff. Janet Smith, an assistant secretary to the cabinet, was sent to Nice in southern France for four months to learn French. The cost to the taxpayer of this Riviera education was $12,000 plus her salary, which is in the range of $60,000 to $70,000 a year. That is the government's idea of restraint.
I would like to speak for a moment, Mr. Speaker, about another favourite subject of mine and one of my colleagues', that is, Crown corporations. Canadair, we have that beautiful jet and this government used to talk to us about the Avro Arrow. Canadair, a Crown corporation, who is it responsible to? How much does it owe? It owes $1.15 billion, and it has to have 400 Challengers in the air to be able to do anything about that debt. My colleague, the hon. member for Capilano (Mr. Huntington), is a big man and every time he stands in this House he becomes, in my view, a bigger man in stature because he calls a spade a spade, and he is telling those

July 19, 1982
Supplementary Borrowing Authority
socialists over there what it is all about. This is what he said, as reported in Hansard of June 30, at page 18968:
I have watched this alliance between the New Democratic Party and the Liberal government, this Liberal-NDP socialist alliance, move in with structure and intervention and control over the marketplace. They move in with an avalanche of Crown corporations. We have just given the minister responsible for the national energy policy powers to put in place, at his will and whim, subject to cabinet approval, Crown corporations with agency of Her Majesty status, which puts them in a place all by themselves. The laws of the provinces, the laws of this federal government, cannot touch these people. These people can commit themselves to debt and to risk, and they create contingent liabilities on top of the burden on this country. The last time I checked, our burden was something like $137 billion of direct debt. We now have another $20 billion to add to that. On top of that debt, our Crown corporations' subgovernment has created another known $58 billion of contingent liabilities on this government. It is no wonder that some of us at large in this country, including the chief executive officers of banks, are now outwardly and outspokenly concerned about the condition of this country. Countries do go bankrupt, just the same as we are watching small business, medium business and now large business face bankruptcies and receiverships.
1 agree with him wholeheartedly. Even Lord Keynes himself would do a 180 degree revolution in his grave over what these fellows across the way are perpetrating in the name of Canadi-anization. This government is unable to speak with even the slightest degree of credibility when it addresses itself to the Canadian people on the question of restraint. The record of this government has been an unbroken string of fiscal excess. We live in a period of little or no economic growth; 1.3 million Canadians are out of work and another 600,000 have stopped looking for work. There is double-digit inflation, crippling deficits, and the hon. member for Thunder Bay-Atikokan (Mr. McRae) stands up and smiles and says we are in great shape.
1 disagree with the Minister of Finance on many things, but most of all on his assessment of the number one enemy in Canada. Inflation is not our number one enemy; high interest rates are. Licking inflation will not necessarily result in lowering interest rates; all you have to do is to look at the U.S. to see that. What I am trying to say is that high interest rates encourage Canadians to sock away their disposable income in banks and things like Canada Savings Bonds at 19.75 per cent interest. How can we get anyone to make a capital investment when they can go out and sock the money into something as safe as CSBs at 19.75 per cent? The government is telling the nation that interest rates are not going to come down if it is willing to pay 19.75 per cent. The results are readily seen in the marketplace.
1 would like to summarize, Mr, Speaker, what we have had in Canada in the past 14 years. It is infiltration by a Prime Minister into a political party, with which he did not agree, to take it over; the indoctrination of people in this country in the theory that there is free lunch when there is not; mismanagement, lack of accountability, deception, and a philosophical and economical drift to socialism by an undedicated and manipulated herd of trained seals over there. We need vocal, democratic, and proud free-enterprise Canadians cheering this House of Commons once more.
Traditionally, Mr. Speaker, I have been a pluralist, someone who has been positive. I hate being negative, but after two years of watching the mismanagement of my country by those people opposite it is hard to get up for the game any more. We
have two years to wait before we get our chance at the ball again; I just hope it comes a little sooner.
However, it is never too late for this great country of ours and for complete recovery if those opposite would only realize that we have been led into a socialist economy by the man who infiltrated that political party. Private initiative is being destroyed in Canada, and 1 hate to see it for my children's sake. Eighty per cent of the world lives under some form of totalitarian regime. That is what we are headed into. So far we have been able to avoid it, but you guys over there are watching it, and so are we. Canada can and must prosper. Inflation can be stopped, but not the way this government is doing it. The dollar can be stabilized. The government can live within the budget. But it can only do that by real government spending cuts, such as my party and my leader have been talking about on this side of the House. We should have sunset laws, we should phase out Crown corporations which are losing money, and have a new budget which rewards productivity. That disastrous National Energy Program should be cancelled, and we should encourage foreign investment, on which this country, as well as the United States, was built. We should promote research and development, and thus productivity, because every 0.25 per cent put into productivity instead of silly make-work projects adds 400,000 jobs to this country. That is what we need, jobs. We should make profit the most popular six letter word in Canada. It can be done, Mr. Speaker. If we were in power right now it would be done, there is no doubt in my mind. I only pray to God for a change of philosophy from those donkeys over there before it is too late.


Lorne Edmund Nystrom: Mr. Speaker, I do not think I will use names. The hon. member referred to donkeys; there is also another word for donkeys which might describe the hon. member who just sat down, if I had not been here myself I would not believe what 1 have just heard. It has been absolute Alice in Wonderland, and it takes me back to my good friend, Robert Stanfield, in a speech he made in Toronto to the Tory convention about two months ago when he was lecturing the Conservative Party about this neo-Conservatism and neo-Republicanism that he saw in his party. It is a very dangerous drift and very dangerous trend, and I wonder if the hon. member across the way knows what his party at one time stood for. It was a party which believed in intervention in the economy. It was a party which brought in the Canadian Wheat Board, the CBC and other Crown corporations. 1 wonder if he understands what political party he really joined.
I wonder if he has ever been to university and studied political science, because any first year student can tell you that he has no idea of the definition of a Conservative Party, let alone a socialist party in this country.
That party across the way is not a socialist party; they are very close to Reaganomics, Mr. Speaker. A socialist party believes in redistributing wealth and power in this country so that the ordinary people have a better share of that wealth and power. Bill C-124, for example, takes us in the opposite direction. A socialist party believes in sharing, in co-operation
July 19, 1982

and freedom, and there are many things in the current Parliament which do not move us in that direction. In every one of those cases it is the Conservative Party of Canada which supports the Liberal Party of Canada in terms of more handouts to the big companies, the multinationals and Reaganism in this country.
I suppose, Mr. Speaker, we could make a good investment by mailing out the speech of the hon. member for Simcoe South (Mr. Stewart) to every voter in this country-


An hon. Member:: Do that.


Lorne Edmund Nystrom: -and make it required reading. There are so many falsehoods in what he is saying. He is talking about debts and government spending. He does not realize that the party that goes heaviest into debt in this country tends to be the Conservative Party. All you have to do is look at Bank of Montreal statistics for either 1978 or 1970 and you will find that Saskatchewan, which has had a democratic socialist government for 27 of the last 31 years, has had balanced budgets throughout those years, and it has the second lowest per capita debt in the country at SI,709. But a wealthy province, such as Alberta, has a per capita debt as of 1978 of $2,022. You can look at Ontario, whose premier is Bill Davis, which has a per capita debt of $2,544. When members get up to speak in the House the least they can be is honest, and I wish they would put the facts before the House.
What about the bureaucracy? We have heard mention of these huge bureaucracies. Once again, it is very interesting to note that for 1979, Statistics Canada states that one of the smaller bureaucracies was in the province that has had a democratic socialist government for the longest time. 1 am speaking of the province of Saskatchewan where 1.9 per cent of the people are civil servants. In Conservative Alberta there is a much fatter government where 2.6 per cent of the people are civil servants. What about the long-time Conservative government in New Brunswick with Mr. Hatfield as premier? Guess what its percentage of civil servants is? It is 3.7 per cent. If there is any party in this country that does not know how to spend, invest and manage its money, it is the Conservative Party of Canada and the provinces that it governs.
In my province we have had an example of that in the last two weeks. We have a new government in Saskatchewan that is now talking about a deficit of $200 million or $300 million. That is the first deficit in over a dozen years. Why does the province of Saskatchewan have a deficit? Is it because the government is investing in Saskatchewan industries? Is it because the government is helping the small businessman, the farmer, the worker, the women or the native people in my province? No, it is not. One of the first things the Conservative Party did when it took power about two months ago was to raise the salary of executive assistants from a maximum of either $35,000 or $36,000 to over $50,000 a year. It is a political party that took office with a promise of eliminating gas tax, not just for ordinry citizens but for CP trucking, Reimer trucking and all of the big transportation firms so that
Supplementary Borrowing Authority
the ordinary citizen will not have to subsidize this by having its government borrow money at 15 per cent or 20 per cent in order to support the services we have in my province. It is a political party that has a mortgage program of 13.75 per cent that is not for all the citizens of its province, not for the poor Indian, the native person, the worker or the renter who cannot afford a house. The program offers no help for the senior citizens or for those who have already bought their houses. The program is for a small minority of Saskatchewan people who make over $40,000 a year. The premier himself has admitted that he will be one of the first people to take advantage of this mortgage subsidy. That is why the Conservative government is borrowing $200 million and will deficit finance at a high interest rate, throwing the burden on the backs of the ordinary working person of the province of Saskatchewan.
The hon. member for Simcoe South should take a look at deficit financing. He should look at big, fat, lazy governments. All he has to do is take a look at Alberta or Saskatchewan, Bill Davis' government here in Ontario and Richard Hatfield's government in New Brunswick.


Mr. Regan:: What about Nova Scotia?


Lorne Edmund Nystrom: Yes, hon. members could try Nova Scotia. The situation there is very interesting. But Nova Scotia's per capita debt is much higher than the province of Saskatchewan's. I also note that 2.3 per cent of the population of Nova Scotia are civil servants. So I can say to the hon. member for Halifax (Mr. Regan) that the situation is just as bad now as it was when he was there. And it just goes to show that Liberals and Conservatives are the same. We have two political parties in this country and it is about time that we cut some of this rhetoric and called a spade a spade.
If we look at the bill before us today we will find that we are borrowing an extra $11 billion because of sentimental Conservative Reaganomics. That is the policy the government across the way is following, and it is following it with the support and the advice of the Progressive Conservative Party that sits to my right here in the chamber.
We have no imagination in this country, Mr. Speaker. We do not have any vision, leadership or national investment strategy whatsoever in this great country of ours. I suggest tonight that we will have to develop those qualities if the government wants to see this bill go through because right now we are floundering in the dark.
I do not mind doing what a company does. I do not mind borrowing money to invest, to expand our economy and our industries. What does General Motors do, what does International Minerals do? What does Gulf Oil do? What does any other company do? Companies go into the money market and borrow money to expand business and enterprise. As far as I am concerned, that is fine.
I support Petro-Canada. An overwhelming number of Canadians support Petro-Canada. That is why the Progressive Conservative Party under its leader changed its policy on Petro-canada about a year ago. The PC government wanted to

July 19, 1982
Supplementary Borrowing Authority
dismantle it, but the leader of the Progressive Conservative Party said his party would probably keep it. That kind of following and that kind of deficit financing 1 do not mind if we, as Canadians, in the end are going to own the enterprise and the industry-


Ronald Alexander Stewart: Show me your stock certificate.


Lorne Edmund Nystrom: -if we as Canadians are going to build a more competitive and productive economy. But Conservatives do not know about this as they drive our country into the rocks with their shortsighted policies. If we are going to borrow money to make Canada more productive, more competitive and to expand the wealth of Canada so that we can improve services to our people, then that kind of borrowing is fine. It is like the farmer in my riding who borrows some money to expand his farm or who borrows to buy machinery, or a small business man who borrows money to expand his business or to buy a new business or perhaps the person who can afford to borrow money to buy a house or expand his existing home. That is the kind of borrowing that is investment. That is productive and it is worth while. It is worth while for Canada. I do not agree that we should borrow money to provide services or to cover administrative costs for the government. When we do that it is non-productive borrowing and it runs Canada more and more into debt. That is the type of thing we have not had with New Democratic Party governments in the provinces, whether you look at the province of Manitoba or the province of Saskatchewan. That is something the federal government across the way will have to get away from. When the federal government borrows money it should borrow money for investment purposes to strengthen the economy and to expand the national pie so that we can have a much stronger Canada in the years that lie ahead.


Jack Wendele Shields: Where do you get it?


Lorne Edmund Nystrom: What kind of leadership do we have in this country? What kind of an economic mess are we in? 1 think we all know the story and we ail know the sad tale.


Jack Wendele Shields: Yes, it is socialist.


Lorne Edmund Nystrom: We all know that the situation in our country is worse now than in any country in the industrialized world.

We rank lowest in the industrialized world. I have here the figures on the industrial production rate and I just found out that last year Canada declined 10.5 per cent. That is the worst performance in the industrialized world. Next after us is the United States where the economy went down 8 per cent. Australia is third, down 5 per cent. The other countries have a better record than Canada and the United States. It is the same story on the stock market. If you follow the price of shares here in Canada, you will note a similar trend. The price of shares in Canada dropped by some 41 per cent between 1981 and 1982, against only 16 per cent in the United States.
Mr. Speaker, it is patently clear that the economy in Canada is in a worse shape than in other countries and the Canadian problem now needs a Canadian solution. We cannot blame the world situation for our economic woes, because the federal and provincial governments must share the blame as well.

I think we are going to have to wake up in this country and start developing and planning a national investment policy. As I said, we do not have it. The goal should be to increase our wealth as a nation, to increase our ability to provide services to the people, and to increase our net worth as a nation. I think we can do that. We have the people and the resources. If we do not have some imagination, leadership and planning-and perhaps those are democratic socialist ideas but we certainly do not have them today-our nation will not thrive in the years that lie ahead.
I should like to point to three countries which have done well after virtually being destroyed during the Second World War. I am referring to Japan, France and Germany. I point to those three economies to remind the House how well they have done and how well they are doing. Also 1 remind the House where they were some 30 or 35 years ago. 1 notice that one of the first things they did after the Second World War was to decide to rebuild their economies, economies they would own as Frenchmen, Germans or Japanese. It was not a question in any of those countries of whether or not they would build a German, French or Japanese car. They would not even ask that question. They built those cars, but we in Canada do not have a Canadian car. It is not a question in those countries now of whether or not they are getting into high technology or advanced technology. They are just doing it in those countries. For example, in Japan they have five times the population, but they have 40 times the young people in electrical engineering schools that we have in Canada.
Last year as a nation, in terms of research and development, we invested one hundred and some odd million dollars, whereas the Japanese put in over $2 billion. They go out and do those things. In some countries they have democratic socialist governments. In other countries like Japan they do not have a democratic socialist government, but they have planning and they have a policy to own and control their own economies so that they, as Japanese, as French or as Germans, can make their own decisions.
I maintain that our failure to do that as a country is the biggest reason we are in such serious trouble now. We have the consequences of that coming home each and every single day as we see lay-offs in the manufacturing industry and lay-offs in the resource industry from one part of Canada to the other.
Back in 1608 it was Cartier who was really one of the founders of Canada. At that time the country was being built on the premise of exporting beaver pelts and the pelts of other animals to Europe and of importing finished or manufactured goods. I suppose we still have that old philosophy in Canada
July 19, 1982

where we try constantly to export raw materials, whether they are natural gas, oil or forest products, and import finished goods.
Let me take a look at the consequences of that policy. In 1970 we had a trade deficit in manufacturing of $2.5 billion. In 1981 our trade deficit was up to $21 billion or $22 billion in manufactured goods. In 1969 we had 6 per cent of world trade. In 1979 we were down to 4 per cent of world trade. I expect now that it is approximately 3 per cent. The Minister of State for International Trade (Mr. Lumley) rises every month and talks about how happy he is to have a trade balance in the country. We have a trade balance in the country, but I think we are one of the only countries, if not the only country in the world, which has a trade balance and a deficit in our balance of payments. Our deficit in the balance of payments last year was some $9.1 billion. The reason for that deficit is that we have interest flowing out to outside or foreign investors. We have dividends which are flowing out, and we have the consequences of a branch plant economy. We have the wealth and resources with which we could be producing in Canada. These products could be owned by Canadians and purchased by the United States. Just because we have a lower dollar does not always mean that the branch plant of a foreign-based multinational will produce in Canada. What they will often do is produce in the United States or Japan and import that good or product into Canada.
I believe very strongly that we will have to restructure the economy so that we as Canadians own it. When we go on the money markets to borrow money, we should borrow it as loan capital, not equity capital, so that when we pay off the loan we own the house, the mine, the store or whatever we borrowed the money for as Canadians.


Donald Alex Blenkarn: How do you pay it off at 20 per cent interest?


Lorne Edmund Nystrom: I hear the question of the hon. member. That is not our policy. That is the policy of the extreme right, the policy of the Conservative Party of the world, the policy of Reaganomics. That is their problem and they will have to find a solution for us. In the province of Saskatchewan when they used public money to find solutions, they poured it into the wealthiest segment, and that is not the way that we want to go.
In conclusion 1 want to suggest positively three or four areas in which we should be spending the money that we have in the country, provincially and federally, and where we should be putting some of our savings.
The first area I want to mention is the entire area of advanced technology and high technology. Just recently the Science Council of Canada issued a report entitled, "Planning Now for an Information Society". In the report we were warned that we are now in a new era and that if we do not move very quickly, we will lose an awful lot of what we have and end up importing more and more of the advanced technological devices and parts in the world of tomorrow. It indicated among other things that advanced technology is moving so fast that we are being left behind. For example, it indicated that the power of computers has increased 10,000 times in the past
Supplementary Borrowing Authority
15 years, while the price of each unit of performance has decreased by 100,000 times in the last 15 years. Also it indicated that in 1990 we will be producing pocket calculators with more power than today's most powerful computers. This is how fast we are moving in the area of advanced technology. My suggestion is that we should be doing like the Japanese, the French, the British or the Americans. We should be putting some more money and funding into advanced technology. We should be producing these goods, services and products right here in Canada.
We can do this in many ways. The Conservative Party does not believe in putting any money into this because they want the multinationals to make all the decisions; they will put their money into the United States, Japan or elsewhere. It is about time that we took the lead as a nation and started investing some of our funds in this sector. Of all industrial states we have less public involvement in the new technology. I suggest that we will have to move in this area.
There are four areas in which I think we should specialize. We should be applying advanced technology to produce the machinery necessary for specialization and to enable us to become very good in four areas. I think two of them are naturals because of our geography. One is communications and the other is transportation. In communications we are already fairly good. We have developed things like Telidon. We are very good at satellite communications. We are very good in my province at fibre-optics. We have a little plant in Saskatoon called Sed Systems, Inc. which was part of the Canadarm. We have Spar Aerospace in Toronto and Montreal. We have many companies, some publicly owned and some privately owned, which are very good in communications. Because of our geography, we must continue to specialize and to provide goods in our markets so that we can export aggressively in the world in the area of communications.
The second area which is a natural is transportation. Again it is because of our geography. 1 do not understand why we as Canadians are not as good at putting trains on the tracks as are the Japanese, the French or the British. We still have transcontinental trains which run along, like the good old days, at about 18 or 19 miles per hour. One can almost pass them on horseback. That is not good enough. 1 think as Canadians we will have to specialize in transportation.
Another area is food and agriculture. We are a great producer of food in this country. We have a tremendously productive agricultural sector. I think we will have to start putting more funding into that area to help feed some of the poor people of the world. We should export our farm machinery technology to the developing world to ensure that Asians, Africans, South Americans and others can produce their own food and eventually become self-sufficient. We should continue doing research into the field of food production, agriculture and forestry. We should take the lead in these areas. We should be involved in biotechnology, for example; not the Japanese, not the French, not the British or the Germans. That is the third area.

July 19, 1982
Supplementary Borrowing Authority
The last area 1 would mention is resources. Our country has tremendous resources. One of our problems is that we have tended to export those resources in their raw and unrefined state throughout the world. These resources are finite and they will eventually run out. We are now running out of much of our conventional oil. It is time that we began to process more of those resources at home. Since we have resources such as hydroelectricity, it is time that we started to manufacture machinery to mine and process those resources in Canada. When I look at other countries of the world 1 find that we are producing very little machinery in this country. There are very few companies which manufacture these machines. In 1980 our deficit in machinery trade was $5.7 billion. 1 suspect that that figure is significantly higher in 1982. We are producing less machinery all the time.
1 recently spoke to an industry spokesman who told me that in the area of computers alone our deficit by 1990 will be approximately $10 billion.
1 suggest that when Canada borrows money for investment we should specialize in four or five areas. These areas include transportation and communication, agriculture and resources and the new high and advanced technologies. If we were to do this through a national plan along with co-operative federalism with the provinces and the federal government working together, instead of the jigsaw network of programs which exist today-a LEAP program here, a LIP program there-we could become very successful. Instead of the government squandering hundreds of millions of dollars, which perhaps only temporarily raises the hopes of some people that it will give them temporary jobs, part of that money should be put into four or five areas where the government could specialize and supply our own domestic market. This would put people to work, and develop industries on a large and competitive scale to enable us to export to the international market.
We have the resources and the education. The Japanese are capable of doing this on a small island with no resources at all. If they can do it, we can do it as well, if not even better. For example, the Japanese recently decided to specialize in pollution control equipment and export that technology to other parts of the world. 1 am sure they will be very successful. We just do not have the leadership which can make decisions like that in this country.
I reiterate that we need a fundamental change and the restructuring of the economy in this country so that we will have Canadian ownership, Canadian industry and Canadian investment. In this way we will be able to own our own homes and businesses.
My concluding point is that if the government wants to put people to work it should be putting our money into the housing industry, rather than helping multinational oil companies as the Minister of Energy, Mines and Resources (Mr. Lalonde) did. As the hon. member for Hamilton Mountain (Mr. Deans) says so often, the housing industry is an all Canadian industry. We build houses for Canadians, we use Canadian parts and
components and we put forestry workers back to work. Many of the furnishings, such as iron and steel used in constructing houses, are also produced in Canada. This is one short-term policy which could be developed by the government. As well, the government can continue its aid to farmers who are competitive, productive and support a large segment of our nation. With that, I urge the House to think positive and bring forth new and fresh ideas and to stop some of the b.s. type of rhetoric which we heard from the hon. member for Simcoe South which is a disgrace not just to members but to any intelligent Canadian.


Some hon. Members:: Hear, hear!


Ian Deans: Mr. Speaker, on a point of order, would my hon. colleague accept a question?


The Acting Speaker (Mr. Blaker):: So that the House understands, the Chair is verifying the number of minutes left to the hon. member for Yorkton-Melville (Mr. Nystrom). The reason for doing so is to inquire as to whether or not there ought to be unanimous consent for a question. The hon. member for Yorkton-Melville has not used all the time accorded to him. Accordingly, it is possible for another member to put a question to him. However, considering the fact that the question is from the hon. member for Hamilton Mountain (Mr. Deans) who is a member of the same party, I think there ought to be unanimous consent to do so. It is the wish of the hon. member for Hamilton Mountain to put a question to the hon. member for Yorkton-Melville. Is there unanimous consent?


Some hon. Members:: Agreed.


Ian Deans: Mr. Speaker, I appreciate that very much. In fact, having looked at the precedents, I might say that 1 was not aware that unanimous consent was required. I read of a similar situation occurring some years ago.
However, let me proceed quickly to my question lest I should upset the mood of the House. I listened with great interest to my hon. colleague who laid out the financial difficulties which certain governments seemed to manage to get themselves into. Did 1 understand him correctly when he said that governments in Canada, particularly at the provincial level, who had carried the largest per capita debt historically were Conservative governments and that the governments which historically had the largest per capita civil service were Conservative governments? Was that the gist of my hon. colleague's suggestion? Would he verify if that is indeed accurate and therefore can be quoted by all members as they travel the country speaking about the balance of politics?


Lorne Edmund Nystrom: fiscally responsible Ontario, the figure is $2,544. In New Brunswick it is $2,924 and in Newfoundland it is $3,702.
1 also mentioned the size of the bureaucracy in each of those provinces. In Alberta 2.6 per cent of the population was in the provincial civil service. In my province, after 27 years of a democratic socialist government, it was 1.9 per cent of the population. It comprised 3.7 per cent in New Brunswick. In Nova Scotia it was 2.3 per cent, 3.5 per cent in Newfoundland, and Prince Edward Island had 3.4 per cent of its population in the civil service.


Donald Alex Blenkarn: What about Ontario?


Lorne Edmund Nystrom: I do not have the figures for Ontario.


Donald Alex Blenkarn: I will give them to you.


Lorne Edmund Nystrom: But we do have a very good indication from the statistics what the ideology in the country is. I think you have to judge a political party by its record. If one were to judge a political party by its rhetoric 1 am sure that Bob Stanfield would have several heart attacks tonight after hearing the hon. member for Simcoe South. That hon. member was light years away from the former highly respected leader of his party and, in fact, light years away from any leader of his party. Perhaps this is the new direction of the neo-conservatism in this country and perhaps that is where the challenge to the Leader of the Opposition (Mr. Clark) will come from at the January convention. Perhaps their new leader will come from that wing of the party.


Donald Alex Blenkarn: Mr. Speaker, on a point of order, would the hon. member for Yorkton-Melville accept another question? He will appreciate that Mr. Devine, the new premier of his province, has said that he will reduce the civil service to the size of Ontario so that he can reduce it by 50 per cent. He said the civil service of Ontario is much smaller. That is why 1 asked the question while I heckled him. He will appreciate that answer. He had the answer. I am sure he did not want to give it. But I want to ask the hon. member a question in reference to what was said by the hon. member for Skeena (Mr. Fulton) who was the lead speaker for his party. He suggested that fast write-offs for manufacturers was a tax expenditure that the New Democratic Party would not countenance, in other words, that manufacturers of goods in Canada should not be entitled to lay off 50 per cent of the capital cost in the first year. The hon. member for Skeena indicated to the House that that was an improper tax expenditure. Would the hon. member for Yorkton-Melville (Mr. Nystrom) expand on his party's attitude toward manufacturers?


Lorne Edmund Nystrom: I would not mind doing that at all, Mr. Speaker. 1 think, once again, that one should look at governments in action and see what governments do. One finds that in our province, over the years, whether there were good times or bad times, we had a real mix of public, co-operative and
Supplementary Borrowing Authority
private enterprise. We borrowed a lot of money in my province for public reasons, to ensure that we owned the telephone company, the power company and the auto insurance company.


Donald Alex Blenkarn: Answer the question!


Lorne Edmund Nystrom: Forty per cent of the potash industry is now publicly owned by the people of Saskatchewan. By the way, it is now the largest potash company in the world outside of Soviet Russia. I suppose, the hon. member for Mississauga South (Mr. Blenkarn) being closer to that ideology in the Kremlin, which is so centralist and so bureaucratic, so big and so fat, might be very interested in that, I am sure.


Donald Alex Blenkarn: Answer the question about manufacturers.


Lorne Edmund Nystrom: That is the kind of policy we have. We are the first province in this country, and maybe the only province, which has a department of co-operatives and co-operation-


Donald Alex Blenkarn: Manufacturers' capital cost allowance!


Lorne Edmund Nystrom: -where we assist and we aid the co-operatives and the farmers, the manufacturers with their goods and products in this country. I mentioned an industry in Saskatoon called Sed Systems, Inc., where we have done some experimenting in economic democracy, where they manufactured part of the Canadarm for the American spaceship.


Donald Alex Blenkarn: Where do you stand?


Lorne Edmund Nystrom: I am telling the hon. member where 1 stand.


Donald Alex Blenkarn: Well, state it! Quit giving me the guff and tell me where you stand!


Some hon. Members:: Order!


Lorne Edmund Nystrom: It is a joint venture, where part of the industry is owned by the workers, part is owned by the university and part is owned by a Crown corporation.


Donald Alex Blenkarn: Just tell me where you extended those capital cost allowances.


Lorne Edmund Nystrom: So, we have that kind of co-operation in our province. The same is true in Manitoba, where we provide aid to small business, co-operatives and the like. Now, Mr. Speaker-


Donald Alex Blenkarn: Mr. Speaker, I rise on a point of order.


Lorne Edmund Nystrom: -the Conservative Party has put all its eggs in one big multinational basket.


Donald Alex Blenkarn: Answer the question! Where do you stand on capital cost allowances?


Lorne Edmund Nystrom: I have answered the question, Mr. Speaker.


Donald Alex Blenkarn: You have not!


Lorne Edmund Nystrom: Instead of giving all this money to the big multinational corporations, we would spend this money in

July 19, 1982
Supplementary Borrowing Authority
assisting small businesses, farms, co-operatives and on expanding public ownership in the areas we did in the provinces that we have governed. Some of those things are done by terrible socialists such as one named Bill Davis, and another named Peter Lougheed. In my mind they are very Conservative-


Donald Alex Blenkarn: Where do you stand, boy?


Lorne Edmund Nystrom: -and are going the wrong way.


Donald Alex Blenkarn: Stand up, boy, and quit guffing around!


Lorne Edmund Nystrom: But even those guys realize that there is a law in our economy providing for some public intervention.


Donald Alex Blenkarn: Say where you stand!


Lorne Edmund Nystrom: Mr. Speaker, if 1 have not said where I stand-


Donald Alex Blenkarn: I know where you stand. You stand with one foot on the left!


Lorne Edmund Nystrom: -then I think my friend, the hon. member for Mississauga South should go to visit his physician because he is going deaf. He is certainly deaf in his left ear and he is probably deaf in his right ear, by now.


Some hon. Members:: Hear, hear!


Ian Deans: Is there anything else you would like to know?


The Acting Speaker (Mr. Blaker):: I think the Chair should give some indication to hon. members that if an hon. member has not used up the entire time available to him in which to speak, the Chair will try to facilitate matters, and that has been the habit of the House. The Chair will try to accommodate hon. members by allowing other hon. members to use that additional time to ask questions. But I am obviously concerned that questions might be asked by one member to another member of the same party. At the same time, I want to make it clear that if one hon. member chooses to rise on a point of order and ask a question or enter into debate, then there can be no excuse or anger later on that the Chair has recognized both the hon. member who rises on a point of order and the hon. member who has the time available.


Gerald Augustine Regan: Was it not a great answer, Mr. Speaker?


The Acting Speaker (Mr. Blaker):: The Chair has no comment to make as to the quality of the answers.


Some hon. Members:: Oh, oh!


The Acting Speaker (Mr. Blaker):: Accordingly, it being 9.55 p.m., the Chair will recognize the hon. member for Athabasca (Mr. Shields).


Some hon. Members:: Hear, hear!


Jack Wendele Shields: Mr. Speaker, tonight the debates have been very illuminating indeed.


Some hon. Members:: Ten o'clock!


Jack Wendele Shields: First, we heard from the hon. member for Thunder Bay-Atikokan (Mr. McRae). Now we have heard the flim-flam of the Liberal Party tell us how the Liberal Party is spending money, but it is really not spending money because it is transferring or moving it around the country. I never heard such rot in all my life. But the single most illuminating speech tonight was made by the hon. member for Yorkton-Melville (Mr. Nystrom).


Ian Deans: A marvellous speech.


Jack Wendele Shields: That hon. member from the NDP-


Some hon. Members:: Hear, hear!


Jack Wendele Shields: -clearly knows what the country is saying about the New Democratic Party, the "Liberal Party West" and the hon. members of the NDP are running scared because they know that the people of Canada have said that they have had enough of those socialists, of those Liberals, whether they call themselves Liberal or "Liberal Party West".


Ian Deans: Who votes with the Tories?


Jack Wendele Shields: That is why they are running scared. So, what does the hon. member do? He stands up but does not attack the Liberal Party and the idiotic energy policy, the borrowing of tons of money on one little scrap of paper. No, he does not attack that. He attacks the Conservative Party of Canada because he is running scared and he knows that he will not be sitting in this House of Commons after the next election because the people of Saskatchewan and the people of British Columbia have had absolutely enough of the Liberal Party West. They are down to two, Mr. Speaker.


Terence James (Terry) Sargeant: I rise on a point of order, Mr. Speaker.


Jack Wendele Shields: Mr. Speaker, may 1 call it ten o'clock?


The Acting Speaker (Mr. Blaker):: Order, please. The Chair will not call it ten o'clock because it is not yet ten o'clock. The hon. member rises on a point of order.


Terence James (Terry) Sargeant: Mr. Speaker, I wonder if the hon. member is aware that during this session his party has voted with the Liberal government twice as often as the NDP.


The Acting Speaker (Mr. Blaker):: Order, please.


Ian Deans: That is a legitimate point of order.


The Acting Speaker (Mr. Blaker):: That is not a legitimate point of order.


Ian Deans: It sounded like one to me.


The Acting Speaker (Mr. Blaker):: Well, it may have sounded like one, but it is not. The Chair will recognize the hon. member for Athabasca.


Jack Wendele Shields: Mr. Speaker, all that the "Liberal Party West", the New Democratic Party, the little red rump, has
July 19, 1982

been able to say since the introduction of the National Energy Program is, "Me too, me too, but make it more. Why do we only go after Petrofina? We should go after Exxon, Imperial and those big guys. Do not just take us down the hill to recession, let us get right into a depression." The people in western Canada know what the "Liberal Party West" stands for. They know that today they have kept this government in power. They have put the government in power. They held it there in 1974, and now the people are all saying that they will have no damned truck with the New Democratic Party come the next election.
Mr. Speaker, may I call it ten o'clock?


Some hon. Members:: No, no!


Some hon. Members:: More, more!


The Acting Speaker (Mr. Blaker):: The Chair cannot call it ten o'clock unless there is agreement to do so.


Some hon. Members:: No, no!


The Acting Speaker (Mr. Blaker):: There remains approximately one minute, and I call on the hon. member for Athabasca.


Jack Wendele Shields: 1 will make it clear in 35 minutes right after the question period tomorrow. 1 would like to point out something I heard just prior to coming into the House today. 1 think it sets the tone for what is happening across Canada, and I hope the hon. members will listen. Two of our pages working in this House, whom we know very well, were sitting by the desk in the opposition lobby. Do hon. members know what they were discussing? They were saying that the job to get today is in bankruptcies. Two young people circulating in the House of Commons daily know what is going on in this House and know what are the government's policies. Those two fine young people who will be going into the world of work after they leave this place are talking, saying the thing to be in today is bankruptcies because that is the only future we see in Canada. That is what young people are saying today and that is the feeling across this country. Laugh as you may, but that is the feeling across the country. It is now ten o'clock, Mr. Speaker.


The Acting Speaker (Mr. Blaker):: The Chair agrees with the hon. member for Athabasca (Mr Shields), it is now ten o'clock.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 40 deemed to have been moved.
Adjournment Debate

Mr. Jack Burghardt (London West):: Mr. Speaker, on June 9 of this year 1, along with my colleague, the hon. member for Kitchener (Mr. Lang), asked questions of the Minister of Consumer and Corporate Affairs (Mr. Ouellet) dealing with product labelling as it applies to the recording industry and some of the rock music which that industry produces and distributes. The matter pertained to what we could call subliminal, hidden lyrics or messages on certain rock music recordings.
Following that question and answer from the minister, 1 received a further answer from the Minister of Consumer and Corporate Affairs informing me that this matter comes under the jurisdiction of the Department of Communications, hence the matter being raised tonight.
While the technique of recording hidden messages or lyrics on some rock music has been going on for some time-I believe it was in the sixties that it first came to light involving the much popular recording artists The Beatles-it has again surfaced, causing a great deal of concern among many of our citizens, both young and old alike.
The most recent issue of this concern came to my attention from a number of my constituents following a public affairs program on a local London station on this subject. During that program it was shown how the use of subliminal influence techniques are used by some popular rock music groups. Following this radio broadcast, the issue received considerable attention-I believe the radio station received something like 400 calls immediately following that program-and much attention was focused on this subject in high school, church groups and other community groups interested in this subject. It seems to be a fundamental concern on the part of many that the public should be made aware of the existence of these largely unnoticeable, perception-effecting techniques.
In the Oxford dictionary, subliminal is defined as "below the threshold of sensation or consciousness ... so as to influence opinion or behaviour without being consciously perceived." A subliminal message is a message that is below a discernible level. For example, your conscious mind hears one thing, but your subconscious mind can pick up the other. Some people feel that subliminal persuasion is as close to mind control as you can get.
I am sure hon. members remember just a few years ago when a great deal of concern centred on subliminal advertising suspected of being used on television and in movie theatres. To my understanding, because of public concern expressed at that time, that type of advertising is no longer used.

July 19, 1982
Adjournment Debate
Since this matter was raised, 1 have been overwhelmed by the interest shown in it, and the support 1 have received from across the country, even from the United States. As a matter of fact, this same issue was raised on the floor of the United States Congress just two weeks ago. The concern being expressed is not a concern in favour of censorship or the imposition of morality. We cannot do that. We can, however, restrict immorality. This is the issue, especially when some of these suspected subliminal messages contain messages which society today, for the most part, would term to be immoral. There is a feeling on the part of many people who have communicated with me that the public should not be subjected to hidden messages of any kind, immoral or moral, for it can be argued that the subliminal technique could be used to promote what many would term to be good influencing messages as well as messages which might be harmful.
An issue such as this generates an emotional response. As well as receiving an enormous amount of support, 1 have been criticized for raising this issue, especially when we have so many other problems with which to deal today. I want to say for the record that I have not spent all my time on this subject, as anyone who reads Hansard will attest. But as responsible Members of Parliament 1 feel we must concern ourselves with many different issues raised and brought to our attention by our constituents.
1 suppose the bottom line in this matter is to ask the recording industry at least to investigate and co-operate, and either to label such suspected recordings or, better still, to refrain from producing and distributing such material.
According to my investigation, at least, much of this recorded material has been produced outside this country in the United States and in Europe, mainly in England, so perhaps we have to look at the distribution methods on the part of the recording industry in this area.
When we think of the many problems facing us today, we must remember that a nation is only as good as its people. I would sooner be on the side of those who influence for good than on the side suspected of having a harmful influence on our society. I would welcome a further response to this matter from the Parliamentary Secretary to the Minister of Communications.


Mr. Jack Masters (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, the hon. member for London West (Mr. Burghardt) and the hon. member for Kitchener (Mr. Lang) have indeed touched upon what 1 too feel is an important point.
1 would just like to explain again that since the arts and cultural branch of the Department of the Secretary of State was transferred in 1980, cultural policy concerns pertaining to Canadian cultural industries, including the sound recording industry, have been the responsibility of the Department of Communications. At present the Canadian sound recording industry is undergoing an extensive examination to determine what support, if any, is required to help it meet its needs and
opportunities. As hon. members are no doubt aware, this industry represents one of the most important cultural activities in Canada, since it provides society with most of the access to the music we enjoy and use in our daily lives.
As the hon. member pointed out, many years ago, during the 1960s, a limited number of foreign producers used the process of backward masking as a new gimmick to attract media attention to records in the marketplace. A few prominent recording artists such as Led Zeppelin and the Beatles did experiment with this technique whereby a record, if played in reverse, would play back different music or lyrics. The fad quickly died down then but, admittedly, has resurfaced lately.
It is supposed by some that the original motivation was strictly to attract attention to the album and not to influence the listeners subiiminally. Experts from both the scientific community and the record industry, including the late Marshall McLuhan, have studied this subject and have stated that since the messages are directly audible, well publicized and not imprintable in the mind unless the listener does reverse the record, it is not a form of subliminal persuasion. However, I will say that the concerns of the hon. members are valid in principle should this practice be used by the industry to the extent where record production would subiiminally influence the listener's mind.
In this regard, the Department of Communications has passed on these concerns to the Canadian record industry associations and will maintain an interest in following this subject should anything new arise.
I would like to add, finally, that the occurrences of this practice are extremely negligible, considering the tens of thousands of records that are produced each year. Also, it is unfortunate that the recording industry tends to suffer mostly from negative publicity such as this when it contributes so much to our fabric of life. I was heartened to see in a recent issue of Maclean's magazine an article which reported on the great success our young Canadian recording talent is having in the global marketplace. In fact, this year, the best year in our history, Canadian artists have outperformed every other country in the world in an otherwise down-sided global economy, and these ambassadors of Canadian culture deserve our utmost support.


AGRICULTURE-TAX ON FUEL USED IN FOOD PRODUCTION
Donald Frank Mazankowski: Mr. Speaker, it has been said many times in this House and in the country that the country is suffering a crisis in confidence. 1 believe the crisis stems in large part from a lack of confidence in the government. Canadians realize every passing day that the government has failed to fulfil many of the promises and commitments it made during the course of the election campaign in the deep winter of 1980.
1 raised one of these questions in question period last Friday when I asked the Minister of Agriculture (Mr. Whelan) to
July 19, 1982

explain to the House what happened to the special price structure he had advocated in the community of Alvinston, Ontario, on January 31, 1980, when he said that fuels used in the course of farm production would be exempt from federal tax. We know that commitment was not fulfilled. What is more shocking is that the minister stated that the energy program is supported by all members of the Liberal Party, including himself.
The minister is clearly on record as supporting the price structure for farm fuels in Canada. That means he supports the fact that 60 cents out of the price of every gallon of fuel the farmer burns goes to the federal government coffers in the form of tax. I think it is worth putting on the record what comprises that 60 cents. There is a corporate tax of 10 per cent or six cents per gallon; the petroleum compensation charge of 18 cents per gallon; the Canadian ownership charge of four cents per gallon; the petroleum gas revenue tax of seven cents per gallon; the incremental oil revenue tax of five cents per gallon; a 9 per cent federal sales tax or 13 cents per gallon, an excise tax of 7 cents per gallon for a total of 60 cents per gallon. That is what the farmers of Canada pay to the federal coffers in order to produce food for Canada and a hungry world.
On January 31, 1980 the minister stated very clearly:
Fuels used in farm production will be exempt from any excise tax and a special price structure established.
You and 1 know that has not happened, Mr. Speaker. This is one of those clear incidents that create a degree of cynicism regarding the Government of Canada and a lack of confidence in the country because the government cannot be trusted. It says one thing and does another. That is a promise it knows very well it could not fulfil.
1 followed that question up in the House today by putting to the minister the promise made in the speech of January 31, 1980, as reported in the London Free Press when speaking to a crowd of 300 in the community of Alvinston, Ontario. At that time he said that the farmers' cost of production would be held in check. As a matter of fact, he pledged to keep farm production costs down. Today I asked him whether he felt he had fulfilled that election campaign commitment.
During the period of time the Minister has presided as the recycled Minister of Agriculture, interest rates have doubled, fuel prices have doubled, pesticide prices have increased by 30 per cent; he is now a member of a government which is proposing an increase in grain freight rates of 45 per cent in three years, to double in five years and triple in ten years while the price of farm commodities goes down. Does he really feel in all honesty and sincerity that he has fulfilled that promise? Well, this was his answer, Mr. Speaker:
-I do not know what research the hon. member is using for all those statements that 1 made because if he is reading speeches I gave during the election campaign, those were not prepared.
What are we supposed to draw from that? Does it mean that when the Minister of Agriculture speaks from a prepared text
Adjournment Debate
he is to be believed, but when he speaks "off the cuff' as he said, in the heat of debate, one should not believe him?
I raise this question at this particular time because I think it deserves an explanation, and I intend to pursue further the commitments and election promises and pledges the minister advanced during the course of the campaign. In all fairness, being a fair person, 1 think it is only fair and reasonable that 1 ask the minister or his spokesman to respond to the government's failure and his failure to produce results. The fact of the matter is that if he cannot produce and fulfil the election promises and commitments he made, he should do one very honourable thing; resign.


Douglas Glenn Fisher: Mr. Speaker, the hon. member for Vegreville (Mr. Mazankowski) is playing a cute game; unfortunately playing it badly. 1 have a great deal of respect for the hon. member. I have served with him on the Transport Committee, and 1 know he has a little more integrity than he has just revealed by some of his comments. May 1 give an example? He is standing up now and playing this cute little game on behalf, he thinks, of one particular group in society. In this instance he is trying to argue, or pretending to argue on behalf of farmers, but he knows full well that other spokesman from his party are rising constantly to know why oil prices in Canada have not gone higher.


Donald Frank Mazankowski: They cannot go any higher.


Douglas Glenn Fisher: People talk about the National Energy Program and its failure to deliver money to the oil companies and its failure to deliver incentives for the industry. When they do that, they are in a disguised way arguing for higher and ever-higher prices. We must bear in mind, of course, that it is official Conservative policy that Canadian oil prices for conventional crude should be 85 per cent of world price, and the Liberal policy is that the same oil will be capped at 75 per cent of world prices.
While we are examining this game being played here tonight, we should also look at where the money will be going, because high Tory prices would simply mean this extra money being poured back into foreign coffers and into the hands of the companies, when in fact the Liberal policy, the NEP, has managed to fairly distribute the money between the producing provinces, the companies and the common Canadian good.
I think those are facts which my constituents support with their wallets and with their feet. My constituents are shopping at Petro-Can, they are converting their furnaces, pursuing the CHIP program for insulation, and wherever possible my constituents are voting with their feet to support the NEP.


NATIONAL ENERGY PROGRAM-EFFECT ON INVESTMENT. (B) DEVELOPMENT OF OIL SANDS IN NORTHEASTERN ALBERTA
Jack Wendele Shields: Mr. Speaker, today during question period 1 directed a question to the Minister of Energy, Mines and Resources (Mr. Lalonde). I stated that the world investment community does not now consider Canada a safe

July 19, 1982
Adjournment Debate
place to invest. This is due mainly to the national energy policy of the minister. I said that the policy itself is causing an outflow of investment capital at an unprecedented rate, causing a massive run on our dollar which is translating into astronomically high interest rates, which again translates into business recession and massive unemployment. What is the minister going to do to get the confidence of the investment community back? The minister replied verbatim: "1 can't be held responsible for that member's nightmares." The nightmare is a Canadian nightmare.
The number of Canadians unemployed has reached 1.5 million. Right across this country Canadians are losing their jobs. Canadians are losing their farms because they trust this government. Canadians are losing their businesses and their life savings. All of these tragedies translate into child abuse, family breakup, child beating and wife beating, all because of the nightmares people have.
The world investment community does not consider Canada as a safe place to invest, and we can trace that fact back to the National Energy Program.
When the National Energy Program was introduced with Canadian investment dollars, Canadians saw a government with a policy that actually stole from the companies. With its back-in provision it actually moved in on companies and said to them, "We really own 25 per cent." People saw this massive grab by the government with more government involvement. As a result, they moved investment capital out of the country. This investment capital kept the country moving.
That move forced the government to borrow or to attract money from offshore. To do that, the government had to raise interest rates. Immediately interest rates were raised, what happened? The small-business men, the farmer, the man buying a home with his life savings or the man rolling his mortgage into a new mortgage found he had to pay 20 per cent on his money, and all because the government introduced the national energy policy. This was an interventionist policy, to the greatest degree, into an area of the economy which was the one healthy area of Canada. Virtually every economist in Canada stated emphatically the oil industry was the one bright hope on Canada's horizon which could lead us out of this economic stalemate and depression. But the government's policy translated into high interest rates.
If investment money was now flowing into Canada, as it would be under a Conservative government, for development purposes, interest rates would go down. We would not have to raise our interest rates artificially in order to attract funds into Canada to do those things that must be done. We would have business expansion which would cause unemployment to go down. People would be working right across the country. Our megaprojects would be proceeding and we would have the industrial heartland of Canada, Ontario and Quebec, humming. There would be no unemployment and there would be no nightmare. We would not have the nightmare the Minister of Energy, Mines and Resources created.


Mr. Dave Dingwall (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, I rise to respond to some of the remarks made by the hon. member for Athabasca (Mr. Shields). 1 had an opportunity to visit with the hon. member in his constituency some time ago, and I must say that, regardless of the subject matter, at least he attempted to be fair. Elowever, tonight we have been given an example of how he has not only been unfair, but has been extremely inaccurate.
The National Energy Program has three main objectives. We are pursuing those objectives very vigorously. I believe that Canadians have judged this program to be very successful. When the National Energy Program was legislated in 1980, it set out three main goals. The ways in which we have attempted to achieve those goals have come under great scrutiny, with the result that some changes have been made to the National Energy Program; changes which 1 think Canadians want to see, changes which 1 think are in the best interests of attaining those particular objectives. 1 refer the hon. member to the National Energy Program update wherein the Government of Canada revealed its entire energy program and made concessions to a value in excess of $2 billion. If we listened to the hon. member, obviously he would say that is not enough. When is enough enough?


Donald Frank Mazankowski: You have killed the industry.


David Charles Dingwall: Of course that will never be enough for the hon. member. The successes of the National Energy Program in terms of conservation have been truly remarkable. The Canadianization plan has been very, very good as well.
The hon. member made reference to the fact that the oil and gas industry in Canada is sustaining great difficulty at the present time. This is true, but that is because of a world economic recession. I refer the hon. member to his great idol, his great mentor, the Premier of the province of Alberta. I will not quote the premier but, to paraphrase him, he said that it was not really fair to compare the statistics of today with those of 1980. As we on both sides of the House know, there are ups and downs, valleys and peaks, in the oil and gas industries. But the hon. member and his party refuse to accept and acknowledge the success the National Energy Program has brought to Canada, or that it will serve Canadians not only for the remainder of this decade but for many decades to come.


Douglas Glenn Fisher: Mr. Speaker, 1 rise on a point of order.


The Acting Speaker (Mr. Blaker):: 1 would indicate to the hon. Parliamentary Secretary to Deputy Prime Minister and Minister of Finance (Mr. Fisher) that no points of order are permitted during the adjournment debate, but I will hear the hon. member in case there is something which may require attention.


Douglas Glenn Fisher: Mr. Speaker, it is actually a courtesy on my part. 1 believe during my statement I said something about integrity; in fact 1 was thinking of the high integrity of the
July 19, 1982

hon. member for Vegreville (Mr. Mazankowski). I meant to question his tactics in this specific instance, not his general character, for which I have the highest regard.


The Acting Speaker (Mr. Blaker):: The Chair is pleased to recognize that the hon. member for Vegreville (Mr. Mazankowski), of whom mention has just been made, has indicated that in the evening it is a compliment to the House of Commons of Canada that so many people are visiting our galleries
Adjournment Debate
at this hour, the time being 10.30 p.m. I understand the hon. member for Vegreville wishes to express his best wishes to the people who are now in our galleries. If that is the case, the Chair passes on his best wishes to those people.
The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow afternoon at two o'clock.
At 10.30 p.m. the House adjourned, without question put, pursuant to Standing Order.
19493

Tuesday, July 20, 1982