June 11, 1929

LIB

Edward James Young

Liberal

Mr. YOUNG (Weyburn):

The situation is the other way around; we are buying because we are more prosperous.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

We are buying because

we are prosperous and we are prosperous because God has given us a great heritage and great crops. The great crops of western Canada, the great forests that can not be replaced in a generation, the mineral products that can never be replaced, have been turned into money and give us a purchasing power which is reflected in our so-called prosperity. But all that we have done is to sell our birthright in the way of mines, forests and the wealth that nature has given us from

our lands, and exported them to give employment to men and women in a foreign country. Is that the kind of prosperity the hon. member for Weyburn (Mr. Young) wants? Is that the kind of prosperity he is hankering for, that he thinks will make a nation or a people, a prosperity by which we become hewers of wood and drawers of water for the great people to the south of us, shipping to them our vast wealth in raw materials partly or wholly unfabricated and then buying back the manufactured goods, so that men and women went from Canada to the United States to the number of 200,000 in one year to find employment?

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?

An hon. MEMBER:

How many came

back?

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

I can say to the hon.

gentleman that the figures are perfectly clear. The number that came back did not constitute 10 per cent of those who went.

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LIB

Charles Joseph Morrissy

Liberal

Mr. MORRISSY:

That was not the case

in New Brunswick, my hon. friend's birthplace.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

My hon. friend's government, not content with dealing with our great neighbours to the south in the manner indicated have also dealt with other nations of the world. They have made trade treaties with France, Italy, Belgium, Czechoslovakia, Estho-niia and other countries and with Australia and New Zealand. The Minister of Finance (Mr. R/obb) used to talk about empire trade in terms that would almost make one weep at his expressions of desire to advance the interests of the empire. With a tremor in his voice he talked about the Australian treaty as a fine gesture of empire unity. But within a few weeks after it had been in force, his government imposed the dumping clause against Australian products and shut out most of the agricultural products of that country. By an order in council on the 25th day of September 1925, a few months after making the treaty, the Minister of Finance put the same treaty into force with New Zealand by order in council. That was only four days after the Prime Minister (Mr. Mackenzie King) said in Woodstock that if the treaty worked an injustice to Canada, he would see to it that it was cancelled. What has happened? In this Dominion during the twelve months ended April of this year, we bought 27,000,000 pounds of butter from New Zealand. While we did that, the United States of America, having increased their duty on butter from two and a half cents to twelve cents a pound, made their people so free from outside competition that all they

Fiscal Policy-Mr. Bennett

bought was 4,600,000 pounds of butter. Do you realize, Sir, there are hon. gentlemen in this house who say that tariffs play no part in agricultural life? There are some of my hon. friends to my left who say that. In the United States of America, in 1920, they bought 37,000,000 pounds of butter to supply the requirements of their own people and at that time the duty was two and a half cents a pound. They raised it to six to eight to twelve cents a pound and in 1928 they supplied all their requirements with the exception of

4,600,000 pounds.

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LIB
CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

The evidence is that

they are eating more butter than they ever did before in their lives. That is what their official reports show.

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LIB

Edward James Young

Liberal

Mr. YOUNG (Weyburn):

They are not

eating within ten pounds per capita as much as we are.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

Quite so, because there

is very little butter consumed in the southern states as compared with what is consumed in the northern part of the United States. Butter fat, as the physiologists tell us, is largely used in northern climes as distinct from southern. The hon. gentleman knows that, and when he talks about oleomargarine, he is endeavouring to draw a red herring across the trail. He cannot becloud the issue in that way, any more than his intervention in Weyburn improved the political situation there.

I have pointed out what has happened in Canada with respect to butter, eggs, poultry. I put this query to my hon. friend: Is it desirable that Canada should become a dependent country with respect to butter, not producing enough for our own requirements? The other day I wrote to the Department of Agriculture of Ontario asking them what the situation was there since the beginning of the year, and they tell me that the total of butter manufactured in February, March and April, 1928. was 10,802,541 pounds, and the number of creameries reporting, 228. This year the quantity manufactured in the same months was nearly 700,000 pounds less or 10,155,818 pounds, and the number of creameries reporting had dropped down to 211, or 17 less than the year before. The great manufacturing creameries of Ontario and other parts of Canada are importing New Zealand butter and this is part of the 27,000,000 pounds the new Zealanders are selling to the people of this country to-day. This is due to the fact that the milk is not available and it was shown here the other evening why that is so. I will

not enter into a discussion with respect to this matter.

I have referred to butter, eggs, poultry and other products of that kind; but let us go a step further. Is it desirable that Canada should become a dependent country with respect to meats, importing more and selling less? Is it right that this should happen in regard to fruits; that we should import more and sell less? Is it desirable with respect to machinery about which we have heard so much talk?

Nothing could be worse for a country than that we should not be able to manufacture machinery and thereby become dependent on people who are competing with us in the same activities. I require machinery in western Canada and under existing conditions I have to go to the United States to get it. I have to take my chance against the United States competitor. If he wants machinery, he gets his first and then I get mine. Shall this country develop its resources on that basis or not? The real issue that faces Canada to-day is whether we shall be dependent on other countries, dependent for butter, for farm products, for meats, for fruit, for vegetables, for manufactured goods such as machinery and so forth, upon a foreign people whose supreme object in life is to support their own interests and prosperity regardless of what happens to us? This is not a matter that one can regard with any degree of satisfaction.

I should like to read to my hon. friend from Weyburn what Professor Dean of the Ontario Agricultural college said in a broadcast message the other day. He said:

Here we have the argument plainly stated. Why did Canada import over 24 million pounds of butter, worth over 8 1/2 million dollars, in 1928, and nearly two million pounds of cheese? The answer is that the Canadian farmer is not accorded the protection in his business which he needs in order to make it profitable. A little over two million cows' milk goes annually into the factories in Canada. We have the land to maintain twice this number of cows for factory purposes. If the full number of cows were kept on Canadian farms there would be no need to import butter and chese for home consumption requirements, and we should maintain our imports at or above the present level. It is an economic question. The Canadian farmer may not know his costs of production so well as he might, but he has a shrewd suspicion that 40 to 45 cents per pound butter in winter does not cover his costs, and he concludes that he cannot compete with cheap grass butter from Australia and New Zealand, which enters Canada practically free of duty. The American farmer demands that his business shall be "protected" similar to that of any other manufacturing business. His slogan is "protection for all or protection for none."

I commend that statement of Professor Dean, of the Ontario Agricultural college to my hon. friend from Weyburn and other mem-

Fiscal Policy-Mr. Bennett

bers of this house. It was broadcast the other day throughout Ontario and indicated at least the considerations that prevailed in inducing him to arrive at conclusions as to what the situation really is.

Now I proceed to deal with the question of trade treaties with other countries. We have a treaty with France and a treaty with Italy, where the farmers of this country sell their wheat and wheat products. What happened? This government made a treaty with those two nations. The treaty with France provides that we shall enjoy the minimum tariff on our exports to that country, but it does not provide that they will not increase their tariff, and so we still have the minimum tariff, while France has increased it three times since the minister made the bargain with them. Only last week I find that the republic of France increased the rate upon wheat to 50 francs for 220 pounds, or about 54 cents a bushel. What are you doing about it, Mr. Minister of Finance? You made the treaty. You cannot complain because we still enjoy the minimum rate. The best tariff rate that the rest of the world gets from France we get. But we have given them favours in our market which we cannot take away from them, while they can take away from us the favours which they have given to us under the treaty.

France increased the duty on wheat first of all from 25 to 35 francs, and increased the duty on flour in the same ratio and then on the 23rd of May of this year increased the duty on wheat from 35 to 50 francs per 220 pounds. Italy increased the duty on wheat from 7i to 11 gold lire per 100 kilograms or about 220 pounds, and only the other day, on the 25th of May, while we were sitting here, Italy further increased the rate from 11 to 14 gold lire per 220 pounds, or nearly 75 cents a bushel.

Where is the agriculturist of the west? What is he doing with this government? Where is the member for Weyburn? Where is the Minister of Agriculture? What are they doing about it when our market in France is taken from us by increasing the rate on wheat to over 50 cents a bushel and our market in Italy is taken away from us by increasing the rate to nearly 75 cents a bushel, while we say under the treaties: Behold the Canadian market; take it, it is yours; we have fixed the terms on which you can enjoy it and cannot change them without abrogating the treaties. What are you going to do about it, Mr. Minister of Finance?

It is the same with respect to Great Britain. I am indebted to my hon. friend from Ontario (Mr. Kaiser) for giving the exact facts in connection with the preference afforded to Great Britain. From 1868 to 1898, a period of thirty years, there was no preference with Great Britain. From 1898 to 1928, another period of thirty years, there was a preference. The average duties collected on imports from all countries were as follows:

Average duties p.c. collected on imports from all countries

Per cent

From 1868 to 1898-on dutiable goods.. 25-50 From 1868 to 1898-on dutiable and free 17-16

From 1898 to 1928-dutiable goods.. .. 25-52 From 1898 to 1928-dutiable and free.. 15-81 from United Kingdom

1868 to 1898-dutiable 23-98

1868 to 1898-dutiable and free

18-641898 to 1928-dutiable

24-391898 to 1928-dutiable and free

18-49

from United States

1868 to 1898-dutiable

22-491868 to 1898-dutiable and free

12-481898 to 1928-dutiable

23-951898 to 1928-dutiable and free

13-35

There are the figures. The so-called British preference negotiated in 1897 and whittled down by the operation of various treaties has now reached the stage where the average duties are more favourable to the United States than they are to the United Kingdom. You may take the figures and make the computation for yourself; any hon. gentleman may do it. I have given the facts of the situation as they confront the Canadian people at this time, not only with respect to the great republic to the south, but with respect to the countries with which we have made treaties, and indicated why the difficulties of trading with these countries are increasing from time to time.

How is the government of the day meeting the situation? You heard this morning the answer given by the Prime Minister: We will meet each situation as it arises. Is that statesmanship? Is that the duty of a statesman? As I read the history of great statesmen whose lives have been devoted to their country, they had prescience and vision and looked into the long future. They saw policies where others saw none and they led their people so that they might be able to meet the emergencies as they arose. What are we doing to meet those emergencies? What are you members from the province of Quebec doing to meet the situation by which your milk and cream will no longer be able to find access to the United States? What are you farmers from the west doing with respect to the increased tariffs on wheat in

Fiscal Policy-Mr. Bennett

France and Italy and the United States? What are you doing about your cattle? What are you doing, my hon. friend from Queens (Mr. Sinclair) about your potatoes from Prince Edward Island that used to pay 50 cents per 100 pounds duty and will now pay 75 cents? What are we doing about the cattle industry?

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LIB-PRO

Robert Forke (Minister of Immigration and Colonization)

Liberal Progressive

Mr. FORKE:

The people will pay more

for their beef in the United States.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

My hon. friend says

that they will pay more for their beef. This seems to me a very proper time at which to make one observation with respect to that matter, because it is an observation made by Professor Sidgewick, who is one of the greatest authorities sometimes quoted by my hon. friends. Professor Sidgewick, dealing with this situation, used words which I commend to every man who studies the economic situation of this country:

I have now to call attention to an oversight in the ordinary exposition of the benefits of free trade, which is of some importance when the division of the world into separate nations is taken into account, and the interests of a single nation are considered. It is often assumed, expressly or tacitly, that when a class in a given nation can obtain any kind of commodities cheaper through foreign trade, the nation as a whole must be benefited by their so obtaining it. What is overlooked is the possibility that a portion of a nation from which employment is withdrawn by the change cannot be employed within their owm country without a loss of utility greater on the whole than the gain from the cheaper foreign supply of the commodities they were producing before the change. I do not think this result is at all a probable one in a country as large and as industrially developed as England. But I think it must be admitted in any theoretical treatment of the subject, that in order to realize the economic advantage obtainable by free trade between two countries, a displacement of labour and capital out of one of the countries may be necessary; so that the aggregate wealth of the persons living in one of the countries may be reduced by the change.

I commend those words of Professor Sidgewick to the Minister of Immigration because I think, coming from such an authority, they will probably have some effect on his mind.

Leaving that for the moment, I again ask what has been the attitude of the government? What are their suggested remedies? I will take them in order. The hon. gentlemen from western Canada who spoke were all very careful to say: You must not interfere with these tariffs of the United States. The Minister of Finance issued a warning, and hardly had the warning escaped him and reached Washington than they began to revise upwards the tariffs originally submitted for consideration. Then came my friend the Minister of Justice (Mr. Lapointe) and he talked internationalism, pure and simple, with respect

to tariffs. He talked the old shibboleths of free trade, clothed in modern terms, and about the resolutions of Geneva. Against that I put not only the words of Professor Sidgewick, but the words of Herr Stresemann when he was speaking at the League of Nations in connection with tariffs and allied matters. These words I commend to the Minister of Justice because they express at once the view that I think should be held by every man who is not prepared to sacrifice his love of country for any such shibboleth as internationalism or free trade throughout the world.

I am of the opinion that no nation which belongs to the League of Nations in any way renounces thereby its own national personality. The Divine Architect of the earth has not created mankind as a universal whole. He gave the nations different strains of blood. He gave them as the sanctuary of their soul their mother tongue.

We might say in Canada "their mother tongues." That is the answer to the speech he made, that is the answer to his appeal to the Geneva resolutions. Then the Prime Minister comes in and closes the debate for this nation, you might say; for the moment he assumes to speak for Canada. It is suffi-cent for the purpose that he has a majority behind him made up of men of diverse views and thought with respect to economic problems; but there is the majority. When he rose and spoke for this young nation what did he say? "Hush! Hush! Don't provoke them over there; they might do something to you; and don't you dare talk about preference with the mother country for you might provoke them worse still and they would become more angry with you than they otherwise might be."

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LIB

William Lyon Mackenzie King (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Liberal

Mr. MACKENZIE KING:

Will my hon. friend kindly give his authority for those words? I do not think he will find the word "hush" in anything I said.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

These are his words, which will be found at page 1403 of Hansard for April 9, 1929:

An important measure, we are led to believe, is a measure relating to farm relief. Another measure relates to limited adjustments of the tariff; I think that is the expression which has been officially used. Having that knowledge before us, I ask hon. gentlemen irrespective of party: In the condition of prosperity which Canada is to-day enjoying would it be desirable on the part of the administration to take any action with respect to the tariff in Canada at the present time which could be regarded as provocative by those across the line who may be interested in seeking to raise the tariff in that country? I say that with the knowledge that we have before us at the present time, were we to do what hon. gentlemen opposite by their amendment apparently wish us to do, namely raise the tariff, we would be creating in the

Fiscal Policy-Mr. Bennett

minds of the American people the very sentiment which would cause them to raise their tariff higher perhaps than it was ever their intention to raise it. We do not intend to take any action of that provocative character.

May I say to my hon. friends opposite, in the other corner of the house, that were we to-day to take a step along the lines of increasing the British preference to a greater degree than exists at the present time that step also might be misconstrued, for we know that there are people on the other side of the line who are just as anxious to be trouble-makers as certain people on this side of the line, who are ready to misrepresent matters, and we have to take human nature as it is, and deal with it as it is. So facing the situation before us, we have followed the policy that we shall follow at all times and that we have followed in the past, of dealing with each situation as it arises in the light of the conditions as they exist at the time.

I 'am sure the hon. Minister of Agriculture (Mr. Motherwell) must cheer lustily that statement, because it represents his view sufficiently-"Unto the day sufficient is the evil thereof." And the hon. Minister of the Interior (Mr. Stewart) who has intimated that his stay amongst us may be all too short, doubtless cheers a sentiment of that kind, because it represents so well the policy of the Liberal party at the moment. That policy is, Don't provoke them!

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LIB

William Lyon Mackenzie King (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Liberal

Mr. MACKENZIE KING:

My hon. friend has not yet found the word "hush," has he?

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

He did not use the word "hush" He said it was a Hush! hush! policy. And that is what it is. Can any such policy be anything more than a Hush! hush! policy?

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LIB

William Lyon Mackenzie King (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Liberal

Mr. MACKENZIE KING:

My hon.

friend's policy is a Hash! hash! policy.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

That indicates the cleverness of the right hon. Prime Minister for which he is so famed throughout this country. A "Hash! hash!" policy he says. Well,

I submit that it is better to have an affirmative policy of any kind than a negative policy.

I say his policy is unfitting to the dignity of this country, and in that regard) I ask him to read the Vancouver Sun, and especially I ask him to read the Toronto Globe. The latter paper says that the time has come when the government must consider this question.

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LIB-PRO

Robert Forke (Minister of Immigration and Colonization)

Liberal Progressive

Mr. FORKE:

Or the Winnipeg platform.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

I should think platforms would be the last thing the Minister of Immigration would ever want to talk about. Anyone who has ever read his utterances from this corner of the house on the tariff policy of the government would be surprised that he does not hang his head in shame to find him-[Mr. Bennett.!

self to-day a minister of the crown in the present government. What does he think of the tariff policies of the government to-day? Has the leopard changed his spots?

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June 11, 1929