Sir WILFRID LAURIER:

The Bill is not printed.

Sir THOMAS WHITE:

I understand

that the Bill is not printed. I would ask my right hon. friend to be good enough to facilitate the passing of the Bill. It is founded on the resolutions which were adopted yesterday respecting the raising of $75,000,000 by way of loan. The Bill will be printed by Monday, and I should be glad to have the second and third readings facilitated. The matter is of importance in connection with negotiations now being conducted.

Sir WILFRID LAURIER:

Upon the

statement of my hon. friend that the matter is urgent and important, I would not raise any objection; but I cannot see, without a more detailed explanation, why it is so urgent. Do I understand that my hon. friend wants to have it at once assented to?

Sir THOMAS WHITE:

What I desire is that the Bill should receive its second and third readings and go to the Senate next week. -

Sir WILFRID LAURIER:

To be immediately assented to?

Sir THOMAS WHITE:

To be assented to in the near future. My right hon. friend is aware, as I stated yesterday, that we have been negotiating in New York for the raising of a loan; and it is necessary that this legislation be passed before the issue can be made.

Sir ROBERT BORDEN:

We could hardly have the second reading without the Bill being printed.

Sir THOMAS WHITE:

Then I shall

withdraw my motion.

Motion withdrawn.

Mr. MACDONALD:

This is the enacting clause of the resolution, and it seems to be the proper clause upon which to hold any general discussion of the resolution. In' view of the fact that last night, before the committee rose, the minister, on being interrogated, intimated that he would consider any suggestions that might be made, I should like to point out the effect of the 'imposition of this tax upon every person connected with mining or kindred industries, where the enterprise involves the development of natural resources, and where the development cannot take place except by the employment of capital. The situation has been this.

During the past autumn, throughout Canada generally, there were a great many propositions promoted and on the verge of being capitalized through the assistance of foreign capital, and this legislation will seriously interfere with the consummation of any such capitalization. Indeed, the an-

no uncement which my hon. friend the minister made in his Budget speech about a month ago has had the effect of absolutely discouraging any attempt to promote industries of that kind. When a person with a proposition, no matter how good, goes abroad with the idea of obtaining the capital necessary for development, the possible investor inquires whether or not this is one of the companies which would be affected by the Budget of the Government. The person interested would be bound to tell the possible investor that it was one of those companies. It is well that persons should invest with the view of developing coal, silver, nickel, gold or other minerals. The person who invests in an enterprise of that kind, particularly at this stage of the world's history, does so with the hope of making some special profit. He takes bigger chances than are taken in the ordinary financial or industrial company. These deal with settled conditions. Business may vary or fluctuate; dividends may be small or great, but there is always a certain basis on which to proceed. It is the same with an industrial enterprise formed for the purpose of producing some special article used in the country. The production of the article is necessary to meet the needs of the people, and the person who invests in that industry knows that the question of receiving dividends depends upon his being able to produce the article as a saleable commodity, and that the price of the article will furnish him with a reasonable profit. But when a man goes into the mining industry, the conditions are entirely different. There may, or may not, be a large quantity of ore; all that has to be taken into consideration by the person who invests. To a very large degree the investment of capital in the mining industry is a gamble. If my hon. friend is going to throw into the melting pot these propositions, he will create a further menace which will intimate to the outside capitalist that the utmost he can get from his investment, after taking all chances, is 7 per cent, before the Government intervenes to take part of the profit. The minister will see that he is menacing the development of that industry everywhere. In addition to that, the party who is looking for capital [DOT] is not in a position to assure the possible investor that the Government may not, at a subsequent session, proceed to levy upon that class of industry to a greater degree. The minister may say, as he said last night, that this tax is going to last for only two vears. My hon. friend is not taking into

consideration, it seems to me, the very serious financial position which Canada is in as a whole when he invites us to believe that this or that or the other tax is going to stop at the end of two years. N The question of where taxation is going to end in this country, under our existing financial conditions, is a matter whch my hon. friend cannot determine, and he does well to put in a saving clause in regard to the future. The consequence is that the party looking for investment in a mining proposition cannot give any assurance that the tax will not be increased in the future, or that the percentage which is now taken is to be the limit.

For a moment, I might refer to that situation. It is all very well to be optimistic and to say that Canada will be in this or that position. There is no sign of the war ending. We do not know, even' in this House, all the commitments that we are making. We have not the information that we ought to have as to just how much this war is costing us to-day, or how much it has cost us since the last data was furnished to the House. Without that information we are in the dark. The extent of the. obligations which we may assume in the future is absolutely problematical and impossible to estimate. It seems to me that this House ought to have that information before taxation Bills and loan Bills are passed. I mention that incidentally to the point which I desire to make, that the party going to look for capital for a mining proposition cannot give assurances of any definite character that the percentage of profit, ito be taken from the man whose investment he desires, will be limited to that now proposed. That being so, the effect in regard to that particular industry is that it will be impossible for any one who has a mining proposition in this country to exploit it by obtaining the necessary capital for its development.

My hon. friend has gone so far as to put in an additional clause in the Bill which means that in determining the amount to be paid by a mining proposition the extent of the exhaustion of the ore in the ground will be taken into consideration. That is only so far so good. It minimizes the situation, but to a very infinitesimal degree. Mining is a natural industry in this country, quite as much so as agriculture. We all hope and believe that, particularly in the far northern country, there is an illimitable store of minerals, the development of which will mean a tremendous expenditure for

supplies and the increased prosperity of the country at large. This industry stands apart, as I have said, from the ordinary industrial and financial industries. It requires spec-ial consideration. I submit that the minister's proposal menaces the future of this industry, and that the slight amendment which he has made in no wise does away with the possibility of injury.

Sir THOMAS WHITE:

I am really obliged to my hon. friend from Pictou for bringing up this matter for discussion. I need not say that I appreciate the benefit of his views upon any subject that may be under debate in this House. He has put forward his representations very temperately, and I propose to answer them as fully and frankly as I may be able. I think that my hon. friend and those connected with the mining industry, or I should rather say some of them, are unduly apprehensive as to the effect of this measure upon their industry. The Government is fully aware of the extreme importance of that industry in the national economy of Canad.a. It is one of the great natural industries, as my hon. friend has observed, and, certainly, the Government would be the last to take any step unless indispensably necessary in the national interest which might have the effect of in any way injuring the mining industry, or retarding the flow of capital into this country. I think I shall be able to, show before I take my seat that there is no ground for apprehension on the part of the mining community. This tax is, as I stated last night, for a limited period. My hon. friend questions whether I was justified in making that statement. I certainly was justified in making that statement, because it represents the intentions of the Government.

Mr. MACDONALD:

If you need money, what are you going to do?

Sir THOMAS WHITE:

I am coming to that. My hon. friend says that the war may he prolonged for two or three years. For myself, I can scarcely see how that is possible. But it may be possible. But should the war be prolonged for the next two or three years, and the financial responsibility of the Government correspondingly increased, it would then, undoubtedly, be necessary to take such measures as might be expedient in the public interest to meet the situation which we should then-be confronted with. That statement is in no way inconsistent with that which I made last evening, namely, that this particular

measure is for a period only. The principle of the resolutions, it would appear to me, indicates that. The principle of the-resolutions is in effect that those individuals, firms and companies, which since the outbreak of the war have been able to maintain a rate of profit beyond what we have fixed upon as a fair and normal prewar standard, shall contribute a fraction of that excess for the purposes of the war. It is a fact with regard to many businesses in Canada that the largest profits resulting from the war, either directly or indirectly, have been made, during the 18 months since the outbreak of the war, by reason of the increase in the price of commodities, due to the demand which arose by reason of the outbreak of hostilities, and in supplying of munitions and other requirements in connection with the war itself. I do not mean to say that if the war goes on there will be a less demand for commodities and munitions, but I do not think that, as the country becomes better organized to meet the new conditions, the prices which obr tained during the past 18 months will obtain in the future. Therefore, it would seem to me that I am perfectly justified in stating, as I do, on behalf of the-Government, that this is a temporary tax. In- making that statement, I largely meet the argument of my hon, friend that capital might be discouraged from embarking upon Canadian enterprise. It is hardly conceivable that an enterprise could be-established within the next few months, and before the termination of this legislation, earn such large net profits that the moderate tax which we are taking from them would be -a serious matter to the individual, firm, or company in question. Therefore, I do not believe, for myself, that when it is realized, as I believe it is now realized, that thi-s is a temporary measure, the effect which my hon. friend anticipates will be produced, or will continue, if such an effect has already been produced.

My hon. friend has, I think, made a statement which, if made by a responsible minister of the Government, would do more to retard the flow of capital through this country than this Budget. But as he is not .speaking on the authority of the Government, it will not have that effect. My hon. friend has clearly indicated the view that the war will probably be prolonged for a considerable period. As to that, I do not know that the information of any one is better than that of another. Itiis not for us to guess or speculate as to the-

length of the war. I never believed that the war would be a short war, but, on the other hand, I do not believe that it can be unduly prolonged. It would seem to me that if the war should continue for a period of, let us say two or three years more, civilization would almost be destroyed, and the economic resources of the world would almost disappear. I believe that long before any such date, as my hon.' friend has in his mind, the forces at work, making for the conclusion of this war, will be such that it will be concluded, and concluded on the terms we are contending for; because although the German nation has apparently been winning victories on land, it has Teally been losing the war. This war will be determined in the last analysis by superiority in resources, in men, in munitions, and in money.

Mr. MACDONALD:

The Minister of

Labour does not think we are going to win?

Sir THOMAS WHITE:

I think he

does; I know he does. I happen to know that the Minister of Labour is certain we will win. The Government is certain we are going to win; not only that, but we are going to leave no stone unturned to make certain that we shall win. That, among other reasons is my motive in bringing down this budget. I want those who can afford to pay, to pay. There is no one who will be taxed that cannot afford to pay, and I know of no one who is not willing to pay. Iii fact, I know the people are anxious to pay the tax [DOT]imposed by this budget.

This measure, therefore, being a temporary measure, it is not conceivable to me, when it is understood, that it will have any effect in retarding the flow of capital towards this country. Let us assume for a moment, however, that it would; let us assume that my hon. friend is right, and that it would have some effect in retarding the flow of capital to this country. I ask this House, would that be a good reason for a Government refraining from faking any taxation action that it might deem indispensible towards the winning of this war. Suppose that at the time of the war between the North and the South, when the United States was torn in twain, it had /been suggested for a moment that the proposals of the Secretary of the Treasury designed, and necessary, for the prosecution of the war by the North,, would have the effect of retarding the flow of

capital into the, United States; would such a suggestion have been listened to seriously? In Canada tb-day, does anyone consider seriously whether general business is going to be impaired or not? General business is of extreme importance. I yield to no man in my desire that the Government should carry on this war with a minimum of inconvenience to the business of the community. I desire that the war should be carried on, in so far as we can carry it on, with our full power, in such a way as to interfere in the least possible degree with the business activities of this country. I desire that on the grounds of business itself, but I desire it more strongly on the ground that, the more we can promote business, the greater the industrial and commercial activities of the country, the better will we 'be able to sustain the economic burden of the war. Therefore, in answer to my hon. friend I may say that while I do not believe that the effect of this legislation will be to retard the flow of capital to this country, I am bound to say that the first duty of this country is the conduct of the war, and that business considerations, while of great importance, are really secondary; and I believe the public in this country take that view. I believe that the public takes that view.

What is the object of this taxation? I have been talking, members of both sides of the House have been talkifig, and with the greatest sincerity, of the seriousness of this war, and there is no divided opinion as to the reality of the menace to the Empire and to Canada. We all have supreme confidence that the issue will be decided in our favour, but we have been alive to the peril, and, so far as I have been able to observe, hon. gentlemen on both sides of the House, my right hon. friend the Prime Minister and my right hon. friend the leader of the Opposition, hold the view that we must put forth the utmost efforts in order to bring about the results which we believe will be brought about, namely, ultimate and conclusive victory. We have been talking about liberty, civilization, and religion being in the crucible, and about the safety of Canada and the integrity of the Empire being menaced by this German peril. We believe that. We are so remote, fortunately in one sense, unfortunately in another, from the scene of the conflict that it is not possible for us, with all the imagination we possess, to visualise what is going on in Europe. You would, not hear any

Mr. MACDONALD:

What company was that?

Sir THOMAS WHITE:

I will give my

hon. friend the names privately. These gentlemen would not like to have their names mentioned in the House. My hon. friend is apprehensive about the mining industry. I think he has totally miscalculated the effect of the Bill upon that industry. The principle of the taxation is this: If net profits have been made, in the case of companies, including mining companies, in excess of 7 per cent, we take one-quarter of the excess and one-quarter only. Does my hon. friend know that, excluding nickel companies, only twenty-four mining companies in the whole Dominion paid dividends last year? My authority is the Canadian Mining Journal.