Sir HENRY DRAYTON:

You cannot support your own workmen and the workmen of foreign countries at one and the same time. What has happened by reason of these important importations from France into England has been that the application of the dole has been extended and the number of unemployed increased.

Mr. HUGHES:

How did Great Britain pay for those goods?

Sir HENRY DRAYTON:

My hon. friend wants to know how they were paid for? I do not know by what theory he would provide for the payment, I do not know what kind of national policy he would suggest; but the

The Budget-Sir Henry Drayton

policy I would advocate would be a policy which would provide employment for the workmen of our own country.

Now as to aluminium: the whole export of France in finished aluminium amounted to 281 tons in 1921 and this grew to 903 tons in 1923. Again I ask, is France progressing? Well, the export of manufactured articles in 1923 exceeded the export of 1922 by 458,000 tons in weight and 3,900,000,000 francs in value. An added weight of 458,000 tons in manufactured articles in one year is a pretty wonderful accomplishment.

We all know, Mr. Speaker, the genesis of free trade. Free trade was introduced into England to ensure cheap labour. My hon. friend (Mr. McMaster) shakes his head. He might not find that in Cobden but if he disputes the statement he has not read aright the briefs of those materially interested in the question-that the free trade movement in Great Britain was forced by the efforts of the manufacturers who were interested in getting cheap food so that there would be cheap labour. Then, Mr. Speaker,

5 p.m. I desire to point out that the whole underlying principle of free trade is the operation of the law of supply and demand. Does my hon. friend (Mr. McMaster) agree with me there, or not? I invite a contradiction if there is any room for contradiction. My hon. friend remains mute, and as he is not at all 6low in speaking up on other occasions I take it that there is no room for dispute in this instance and that my statement is correct: Free trade is based upon the free operation of the law of supply and demand, of buying in the cheapest market and selling in the dearest, and so on. Very good. I desire to point out to to some hon. gentlemen opposite and to hon. gentlemen to my left something the significance of which they have as yet failed to grasp-that the principles of free trade in application to-day are as dead as the dodo; they do not exist; they cannot exist. Does the law of supply and demand apply in Great Britain? Theoretically?-yes; absolutely?-we all know it does not. The law of supply and demand is the law to regulate prices, costs. At least sixty per cent of the cost of production is labour. Every hon. gentleman knows that the time is long past for considering labour as a commodity to be judged and weighed by the law of supply and demand.

Mr. EVANS:

What of agricultural exports from Canada?

Sir HENRY DRAYTON:

My hon. friend is making an interruption which, perhaps, I

TSir Henrv Dravton-1

shall have time to deal with later on, but not at the minute. I want to follow out in the free trade area what the real situation is, and we might as well try to get the real situation. Everybody knows that wages today in Great Britain are paid on a scale fixed either by trade unions, or by agreement, or by arbitration. They know that they are rates which are fixed, having at least some regard, as much regard as is possible perhaps, to the right of man, the right of the worker. Just imagine what remuneration would be to-day in England if the law of supply and demand were to operate on the labor market! What kind of pay would those who might get a job receive if the law of supply and demand were to operate in a market with a surplusage of one million two hundred thousand workers? It cannot apply at all. It is impossible to apply the principle of free trade in any country and maintain for any length of time a higher standard of living than the standard of living of your competitor. In the long run, you get down either to the standard of living of the lowest, or you will do what the Mother Country is doing to-day -you will be living to a large extent on your accumulated profits of past years.

I must apologize for the length of my remarks. They are far longer than I intended to make them, but we have had some very interesting interruptions. Might I return to the budget itself, having regard to its concrete proposals, and I am not going to detain the House very long in connection with them? There is not very much to talk about in this budget. There is a good deal of room in it for moralization . There is any amount of room for wondering how it is that, under a policy of no protection for anything which is to be used for development, production, instruments of production, we can have a protective duty on coal. There is certainly room for wondering whether it ever again could be said that the policies of the government and of the Progressive party are similar and synonymous except, of course, when the local Liberal orator is on the western platform. Can it really again be said? I had an idea that the gentlemen from the west called for free trade in coal, claiming that it was an essential of life, that it had to come in. There is some room for moralization there. There is, however, some room for hope even for this government.

Mr. HOEY:

The hon. member is optimistic.

Sir HENRY DRAYTON:

I agree with my hon. friend, there is very little, but I want to be fair. After all, for the first time since its

The Budget-Sir Henry Drayton

inception, this government has listened to the cry of labour. I wonder, however, if the awful conditions which prevail in Nova Scotia must prevail elsewhere before this government will do what its bounden duty is to do, to provide work for Canadian workmen. Is it to be necessary that the pain, suffering and turmoil of weeks and months must be gone through in order that that which ought to have been done long ago shall be done? If so, it is a melancholy outlook for labour in this country. The great difference between the coal worker, who is to-day to some extent recognized, and industrial workers who have already gone out of the country, is that while the latter had the money to pay for their fares and get out, the coal worker did not. That is the real difference, and if the industrial workers had not had that bit of money to get out with, we would have had to-day in the industrial towns, a repetition of what we see to-day in Nova Scotia.

Turning from the workers, I ask: Is it to be necessary that companies must have strikes of this character; should have to treat their employees in the way in which these miners have been treated in order that they may get some share of their own markets? Now that a little opening has been made, perhaps some of the light of reason may filter through, and the government, before it is entirely too late, will try to do something for Canada. In connection with the coal duty, my hon. friend does not do his act with justification. He seems to be ashamed of it. He does not submit this as a protective duty, as an increase in duty-this is just something that is going to make customs collections easier! That is all that is in the budget. I admit at once it is much easier to multiply a given sum by fifty than by fourteen, and this is easier just to that extent. What does it mean?-I think my hon. friend's figures are a little out. In 1924 our imports of slack coal from the United Kingdom were 200.427 tons. The duty on that was $20,047. Under the new tax the duty of $20,047 will become $60,165. We imported from the United States 3,823,753 odd tons, and the duty on that amounted to $535,325. That duty under the new tax becomes $1,911,876. In other words, there is an increase in the duty on American slack coal of 275 per cent, and in British slack coal of 250 per cent. The trouble with my hon. friend is that when he starts looking after somebody he does not apply any principle generally; he makes a little dab here or there in the name of suffering humanity. We imported in bituminous coal from the United Kingdom in 1924 69,399 tons on which there was a tax payment of $24,-

365.07, and from the United States we imported 11,544,184 tons on which there was a tax payment of $6,118,417. In the English rate of duty there is no reduction at all; it is the same now. But in the American rate, that payment of $6,118,417 will become $5,772,092 odd. In other words, there will be a reduction as regards bituminous coal of $346,325.52. as a result an increase in taxation of $1,416,668, with reductions noted making a net increase of $1,070,344.

There is another point to which I wish to refer for a moment, and that is the export of power. In my opinion the action of the government in this connection is ill-considered, and we have no statement of reasons which would enable one to come to any conclusion as to what actuated the government. I am rather afraid that the government has been moved by two things both of which I consider entirely wrong. Let me say in the first place that I am utterly and unalterably opposed to the further export of any electrical power from Canada, for it will not be so many years before we shall need it, and we know that we cannot get it back once it goes. Now, the tax in this regard appears fairly heavy, but that depends on the way you look at it. In most of the consuming centres of the United States, I think I am safe in saying, $36 a year per horse-power is considered fairly'- cheap, while the charge here is a mere fraction of that amount. Our rate could be doubled, trebled and quardrupled, and it would still pay the Americans in most instances to take power on that basis. But I am afraid that the government is preparing the way for an excuse which will enable it to consent to the export of power in large quantities. I would ask my hon. friend (Mr. Robb) if the government has not to-day applications for the export of power? I take it that his silence implies that I am right. It is common knowledge indeed that application has been made for an immense amount of power export, and I submit that it would be a crime against the country, under the shadow of this tupenny-ha'penny tax, having regard to present values, to allow one horse-power to leave the country. At any rate, it is something to which I am absolutely opposed. There is another angle from which we may look at the matter. Frankly, I ajm of the view that we should never have had any export allowed at all. But it was allowed under legislation, and rightly or wrongly the people who do business under an act that was law at one time have some right to consideration. And I submit that if anyone in this country is entitled to consideration in connection with the develop-

1568 COMMONS

The Budget-Sir Henry Drayton

ment of electrical energy it is those who have developed it for themselves and given service. The Hydro Electric Commission of Ontario were obliged to enter into a contract with the American corporation that owned and controlled the development of the Niagara river on the Canadian side and which controlled the distribution of the system on the other side of the river, whereby they agreed to supply power at a very low rate. The rates in those days were absurdly low as compared with those that are now charged, and the mere fact that the hydro commission to-day has to supply power at those rates means a tremendous loss to it, a loss ranging probably from $120,000 to $180,000 a year, handling the power wholesale, and much more than that at retail. Now, the tax cannot be passed on under the contract, and this impost will simply mean an additional cost to every municipality in the province of Ontario which makes use of the Hydro Electric system. Why is this done? Is it done to injure public ownership on the one hand, or is it done, on the other hand, to facilitate the export of a whole lot of power which Canada in the comparatively near future will urgently require? I hope that the minister on giving the matter further consideration will withdraw that provision.

The minister has an interesting provision this year in connection with the dumping clause. I believe in protection, but 1 believe in a protection which everybody will enjoy alike; I believe in a protection which is passed upon by this House. I certainly am opposed to any measure of protection which will ask this House to abdicate its functions as a taxing power. I do not believe in a department deciding what the value shall be according to its own yardstick, and I want the minister to understand thoroughly that so far as we are concerned we want to-day to see some return to the principle of parliamentary responsibility rather than talking about it.

We ought not to have any dumping in this country; we ought not to have distress goods thrown on the public without benefit to the people. That only means that we are going to put out of business so many more Canadian workers without bringing down the general level of prices. My hon. friend is right in trying to do everything he can to prevent dumping, but I submit that the dump should be covered by some clearly expressed principle whereby this House will know what it is doing. There should not be a dumping clause enabling the valuation to be fixed by the department under regulations to be passed by the minister.

I apologize, Mr. Speaker, for taking up the time of the House at such length, but my task is pretty well finished. I have already spoken on the question of our debt, and I have pointed out the additions to it, as I see them. Again I point out that the addition of $100,000,000 is the only thing which can be deduced from my hon. friend's own figures and from the return of endorsements, if we are to be honest, unless we say, "We are not responsible for the railways, we are not responsible for our endorsations."

There is one other point I desire to refer to. We have debt on the one hand and taxation on the other-war taxation still going on without any reduction of our debt. We find that there is still a multiple of the sales tax which these hon. gentlemen found when they took office, and we also find that ever since their accession to power there have been heavy increases in the national debt. We find picayune taxes here, there and everywhere, nuisance taxes and the like, so that the House-

Mr. ROBB:

But I would remind my hon. friend that we reduced taxes last year and took $52,000,000 less from the people.

Sir HENRY DRAYTON:

My hon. friend

did make some reduction, but, as I pointed out to him two days ago, the rest we got was by a slow process of strangulation; it was not got by any reductions made in taxation, it was got os a result of government policies stifling Canadian production and Canadian activities. The tax still stands. It is reductions in taxes that we want, and so that this question may be considered, Mr. Speaker, I beg to move, seconded by Mr. Baxter:

That all the words after the word " that " be struck out and the following substituted therefor:

" Conditions in Canada urgently demand reductions of taxation, especially of the sales tax and other levies which have been increased by the present government; and the House regrets that the financial statements now presented show no evidence of the economy necessary to make such reductions possible, but rather disclose an alarming increase in the public debt. "

Mr. J. J. HUGHES (Kings, P.E.I.):

Mr. Speaker, I believe it to be my duty to take part in this debate and to remove, so far as I can, some misconceptions and misunderstandings that seem to prevail in some quarters in regard to the trade conditions of the country as a whole and particularly in regard to trade conditions in the Maritime provinces. But before going further, I wish to make a very brief reference to the speech delivered by the hon. ex-Minister of Finance (Sir Henry Drayton) who has just taken his seat. The budget naturally contains a great

The Budget-Mr. Hughes

many official figures, and the hon. gentleman, while not questioning the accuracy of those figures, tried to draw from them different conclusions from those arrived at by the Acting Minister of Finance (Mr. Robb). It has been said that figures will not lie, but everybody knows that in the hands of a skilful manipulator they can be made to prove almost anything desired. The exMinister of Finance being a master mathematician plays very skilfully with figures and brings out some wonderful results. Still, with all his skill he did not seriously question any of the figures except those relating to the railway accounts. It must be borne in mind that two of the most prominent chartered accountants in Canada have declared over their signatures that the railway accounts as kept between the government and the railways are kept now exactly as they were kept when the hon. gentleman himself was Minister of Finance.

Mr. MEIGHEN:

What difference does

that make?

Mr. HUGHES:

It makes a great deal of

difference to the criticism of the ex-Minister of Finance.

Mr. MEIGHEN:

It does not touch upon

his criticism at all.

Mr. HUGHES:

He had to meet that difficulty somehow, and he met it by saying he supposed he had been wrong. Well, I think I can leave that phase of the question there. The hon. gentleman seemed worried-perhaps that is too strong a word-he was concerned with the huge railway debt and with the large annual railway deficit. But is there a thinking man in Canada who is not concerned with the railway problem? If it were not for that problem we would be in a pretty good condition; we would be able to reduce considerably both the national debt and taxation. We cannot get clear of the railways. We are all demanding an up-to-date service, and we are getting it. What is the railway problem? When the hon. ex-Minister of Finance was speaking on that subject I asked him what he would suggest that the people of Canada could do to remedy the railway situation. He answered that he did not know, but that when he had the figures for the past calender year he perhaps would be able to answer the question. But surely there must be some answer to the question, and I think the government, as announced by the Minister of Railways (Mr. Graham) some days ago, has a policy that may perhaps bring results, if the heads of the two great railway

systems can be brought together with the Minister of Railways and with perhaps leading business men and men of railway knowledge. Then surely some policy could be evolved that would cut out railway duplication to a very large extent, reduce railway operating costs, and at the same time give the people a sufficient railway service.

Mr. LADNER:

Would the hon. member favour the Shaughnessy plat ?

Mr. HUGHES. I would favour any plan that would bring results. In the early part of the session Tie right hon. leader of the opposition (Mr. Meighen) put a resolution on the order paper which he was very anxious to discuss before the budget would be introduced, because, I suppose, it embodies the platform upon which the Conservative party intends to go to the country at the next general election. I presume, therefore, that the right hon. gentleman would not object to having that resolution or the principles of it considered during the discussion of the budget.

Mr. MEIGHEN:

Cannot give it enough consideration.

Mr. HUGHES:

Because it cannot be

reached in any other way during the present session. The Montreal Star stated that the ideas in the resolution were stolen or otherwise obtained from the hon. member for St. Lawrenee-St. George (Mr. Marler).

Mr. MEIGHEN:

I hope that will induce the hon. member to support it.

Mr. HUGHES:

No, that makes no difference. If that statement on the part of the Star is correct, or even partly correct, and if this resolution is the joint production of these two hon. gentlemen, then all I have to say is that there are at least two hon. members of this House who are woefully lacking in knowledge respecting the trade conditions of the provinces on the Atlantic seaboard. As that resolution may be supposed to contain the principles of the platform upon which the Conservative party intends to go to the country at the next general election, I presume the subject matter was submitted at all events to the leaders of the party before it was adopted and published. I presume also that the hon. member for St. John and Albert (Mr. Baxter) saw it and approved of it, and if that is correct then there is a trinity of innocents abroad, as regards trade conditions in the provinces where confederation was bom.

The Budget-Mr. Hughes

Mr. MARLER:

The hon. member has made some very startling statements to this House. He has even intimated there was certain collusion in the matter to which he refers. Let me tell my hon. friend that if he made any such assertion it is wholly untrue.