May 13, 1930

CON

Grote Stirling

Conservative (1867-1942)

Mr. STIRLING:

So far as the fruit and vegetable grower is concerned, he has already answered that question, "No, I cannot." For years past the government and their supporters have been vaunting their principles and deriding ours; they have been misconstruing our words and taunting us and disbelieving what we said in relation to this matter; they have put forward their own principle as something which is just and upright and on which a great Canada can be built; they have derided ours as a snare and a delusion. Now, when their tide is ebbing, when power is slipping from them they have grasped at this elusive protection, they have attempted to make use of it, and they have produced a fiscal jumble which will yet be their undoing; and if they blow up in this house without passing the budget, they will go into the campaign with the horrid thing tied to their tail; but if with their disconcerted majority they put it through they will have to push it before them in every riding throughout the Dominion. I have a strong impression, Mr. Speaker, that were a tense silence at this moment attainable, one's ears could catch a sort of gentle rushing sound as of a multitude in motion-a sound of the swing of the pendulum.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Charles Edward Bothwell

Liberal

Mr. C. E. BOTHWELL (Swift Current):

Mr. Speaker, in spite of the criticisms we have heard this afternoon of the budget brought down by the hon. Minister of Finance (Mr. Dunning), the favourable impression made by him on the first day of this month has not been dissipated during the days that have passed. In fact, the impression that it is a good budget has been confirmed from day to day. W e have heard this budget analyzed by the hon. leader of the opposition (Mr. Bennett), by the hon. member for Vancouver Centre (Mr. Stevens) and by the hon. member for Fort William (Mr. Manion). The country has had an opportunity of reading the analyses made by the two first-named hon. gentlemen, and still we find that the papers throughout Canada are endorsing the budget.

After the budget speech was made by the Minister of Finance, that good old, outspoken, Tory paper of the city of Toronto, the mouthpiece of the Conservative party throughout the Dominion. The Mail and Empire, had this to say:

The Dunning budget does not vary from the tvpe with which the King government has made the country familiar. It is centred, as were its predecessors of Mr. Fielding's and Mr. Robb's framing, on the avowed object of cheapening production.

Another item from the same editorial:

Though the government is worrying about its future it shows little sign of repentance. It still leans to the free trade principle for which, almost in its purity, Mr. King and his party declared in the convention of August, 1919.

That same paper does not applaud the budget brought down by the Minister of Finance, but those are statements which were contained in the editorial. A large portion of the press ce Danada has been favourable to

The Budget-Mr. Bothwell

us and the Minister of Finance has been congratulated from one end of Canada to the other on the step he has taken in the development of the British preference and in the furtherance of unity among the different parts of the empire. When General Smuts visited Canada in the early part of this year he referred to the fact that the past ten years have been spent in elaborating the status of the individual parts of the empire, in developing the freedom of the dominions through their respective constitutions, and in bringing about their recognition as equals in the empire and in the world. His appeal was for unity in imperial relations and he expressed the hope that the next decade might be devoted to giving reality to that unity. He referred to the fact that Canada had taken the lead in the development of dominion status and appealed to Canada once more to take the lead in the new program. Canada has now taken the lead. She began to do so in 1897, and she has taken a further step at this time with the intention of further moulding the empire.

Hon. members on the opposite side of the house have frequently said during the progress of this debate that there are many items in the budget brought down which will not benefit Canada, and that there will be given in reality no additional preference to British products. That is quite true and the Minister of Finance, when delivering his budget address, referred to them in these words:

There have existed in our tariff, for years, many items carrying rates of duty in the British preferential column, but relating to commodities in which none of the various British countries has been an effective trader.

Hon. members of the opposition seem to take great delight in referring to the item of hay. In listening to the addresses of those hon. gentlemen I have been reminded of the fact that a drowning man grasps at a straw; apparently that is what hon. members are doing in this particular case when they refer to the items of hay and straw in the tariff schedule. I wonder if it is more absurd to have hay and straw come in free of duty from England than it is to have those commodities set out in our tariff as bearing a duty of 75 cents a ton.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Charles Avery Dunning (Minister of Finance and Receiver General)

Liberal

Mr. DUNNING:

That is the point.

Topic:   THE BUDGET
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LIB

Charles Edward Bothwell

Liberal

Mr. BOTHWELL:

It is quite true that

we never expect to import hay and straw from Great Britain or any other part of the British Empire, and there is no reason for having a tariff of 75 cents a ton.

In connection with the budget and the tariff schedules in particular, I think the min-

ister is to be congratulated on the fact that the changes made by him have been made after an exhaustive study by the Tariff Advisory Board. The Financial Post in its issue of May 8 takes the opportunity to congratulate the minister, in the following words:

Possibly the most significant feature of the tariff changes is the indication it gives that Mr. Dunning will rely more largely than his predecessor upon the advice of the Tariff Advisory Board.

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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

Hear, hear.

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LIB

Charles Edward Bothwell

Liberal

Mr. BOTHWELL:

Mr. Robb appointed the tariff board but paid little attention to it, leaving the impression that it existed _ chiefly as a buffer between himself and claimants for tariff changes.

I might mention that the tariff board was only in existence a short time, and many of the items which came before it for investigation were never disposed of during the lifetime of our late lamented minister.

But the Tariff Advisory Board is no pigeonhole for Mr. Dunning. From the changes announced one can see that many eases brought before the board have received careful consideration. The importance of this to Canadian business cannot be exaggerated.

No one who followed the sittings of the Tariff Advisory Board will deny the fact that there has been exhaustive investigation by that board. Any person who was interested in the work of the board and who had an interest in any application before the board was entitled to appear there and to be heard, and the board gave consideration to representations made before it. No person will deny that the Tariff Advisory Board has been a great addition to the departmental features of our government. Many hon. members opposite have for the past few years been concerned very much with the operations of the Tariff Advisory Board and particularly with the work of the Consumers League. Questions have been asked in this house and they have been answered; yet it does not appear from the questions which are asked that hon. members opposite have taken the opportunity to find out what the Consumers' League stands for. When the Tariff Advisory Board was first formed it was the belief of many people throughout Canada that there was the possibility of highly organized associations, such as the Canadian Manufacturers' Association, appearing before that board and presenting only their side of the case. The facts in connection with various applications which might be made by such associations would be peculiarly within the knowledge only of the firms represented. The idea behind the formation of the Consumers' League was to have

The Budget-Mr. Bothwell

someone present to cross-examine the witnesses who were applying for increases in tariff, and possibly to cross-examine those who were applying for decreases. The Consumers' League was not formed as a free trade organization; nothing in its articles of incorporation would indicate that. For the benefit of members of this house I wish to place on Hansard the objects for which it was formed:

1. To consider and discuss all applications made to the board on tariff, taxation and other related matters, otherwise known as the Tariff Advisory Board, and to oppose and resist any applications which may seem calculated to so change the tariff laws that the public generally will be detrimentally affected.

2. To procure information concerning tariffs and the effect of same on industries concerned, and the public generally, and for such purpose, and in order to lay such information before the Tariff Advisory Board, to maintain representation before such board at all its sittings.

3. To consider, originate and submit applications to the said Tariff Advisory Board for changes and adjustments in the tariff laws, vhere such changes or adjustments are deemed to be in the public interest.

Representatives before the Tariff Advisory Board appearing in behalf of the Consumers' League have admitted that there should be increases in tariff in some particular cases, because it was necessary to grant such increases in order to equalize the items with the other tariff schedules. When the leader of the opposition (Mr. Bennett) took occasion to analyse the budget he referred to articles written by R. J. Deachman, the representative of the Consumers' League before the tariff board. He took delight in referring to the Liberal government as walking up to the penitent bench, but there are certain words in the same article which he did not stress. They are:

Minor upward changes may take place. In trying to adjust a tariff downward it would be remarkable if there should not happen to be odd items which called for the reverse process. The general trend of the budget, however, will he downward, not upward.

And again:

There may be items in a Liberal budget to the cold eye of the observer which may have a Tory shade. Possibly the reverse might happen in a Conservative budget.

The article goes on to say:

The Conservatives accept the idea of increased preference to Great Britain. They would apply it exactly as Australia has applied it. That is, they would raise the tariff against the United States, against Europe and even against Great Britain. The idea would be to make a wall over which Great Britain could not climb, and then erect one over which the rest of the world could not see. All this, remember, in a spirit of devotion to the manufacturers of Canada.

Behind that wall our manufacturers, in a large measure controlled by American capital, would exploit the Canadian. The extent of this exploitation would be limited only by the capacity to bear.

I want to say at this time, Mr. Speaker, that the articles written either on behalf of the Consumers' League or by Mr. Deachman personally are not the main object of the organization, which is to bring out facts upon which a reasonable and sensible kind of tariff can be imposed. We realize that it is very difficult for the tariff board to get at all the facts, and we know the same difficulties exist in other parts of the empire.

The opposition in this house seem to have only one panacea for all ills; that is, increased tariffs. Australia tried that policy and the result has been that Australia is not prosperous; debts are increasing and trade has declined. To-day Australia is in the worst financial position of any member of the British commonwealth of Nations. The government of Australia, realizing where they were drifting, in 1927 appointed a commission of economists to report on the tariff situation there, and that report is well worth reading. One of their conclusions is:

The interests of the government itself are apt to tempt its members and supporters to acquiesce in some dubious extensions of protection because of the revenues gained incidentally .... Each industry should be required to show cause from time to time for the protection it enjoys, and should establish beyond question the fact that it is not receiving a greater subsidy than it needs. Every other means of promoting new industries should be exhausted before recourse is made to the tariff. The present costs of protection are dangerously high.

They say further:

The tariff has increased the proportion of customs to total taxation beyond the limits economically desirable. As the tariff grows, its cost6 overtake its benefits. It has stimulated the demand-never latent in Australia- for government assistance of all kinds. Further increase may threaten the standard of living. Therefore, no extension of the tariff should be made without the most rigorous scrutiny of the industries concerned and the costs involved.

With regard to wages and protection it points out that high labour costs may be due to bad organization as much as to high rates, but the only standard of living that a tariff can protect is one which the resources of the country can provide. Again and again the report urges that full information of costs and profits should be available to the board.

Our situation in Canada is much the same as that in Australia. As I said a moment ago, it is difficult to get all the facts before the tariff board. If manufacturers in Canada, who

The Budget-Mr. Bothwell

are now enjoying protection at the expense of the rest of the people, were compelled to carry out the recommendations of that Australian commission, we might have a different story to tell; that is, each industry should be required from time to time to show cause for the protection it enjoys and to establish beyond question the fact that it is not receiving a greater subsidy than it needs.

Coming again to some features of the budget and particularly with regard to the extension of the British preference. As I said a moment ago this feature of the budget has apparently been appreciated throughout Canada from coast to coast. The history of the Liberal party in Canada has been one of continued advance in the exchange of trade with other parts of the empire, and it only took the situation in connection with our grain crop last year to bring home to us the fact that we need to find markets other than those of Canada, and that we need to cooperate with our best customers and to deal with other parts of the empire. The president of the wheat pool applauded the budget in these words:

The Saskatchewan wheat pool organization has been on record for some time as being in favour of any steps which would result in a larger interchange of products between the United Kingdom and Canada, and, naturally, the increase in the British preference would appear to be the most effective means of giving promise of development in that direction. The United Kingdom is the biggest single market we have for our western wheat, and if the increase. in the British preference will result in a larger amount of buying of British goods it should be in the interests of both countries.

We also have the following words of Mr. M. J. Coldw'ell, a member of the Saskatchewan Farmers' Political Association:

From a cursory glance at the budget, the downward revision of the tariff rates is a move in the right direction.

Then we have also the Ottawa Journal, apparently the official organ of the party in the Capital:

While the budget in the main must be necessarily controversial, one feature of it, the Journal believes, will receive pretty general commendation. It is that feature which removes the duties from fruits and vegetables imported from the British West Indies. This is not merely something of promise for the Canadian consumer. It is a step, a very substantial one, in the direction of something that has been supported in past years by all parties, namely, the encouragement of mutual trade between Canadians and the people of the West Indies.

And again:

What is now done, we believe, will tend greatly to further increase trade between the two countries, and. incidentally, heighten the chances of success for the recently inaugurated steamship service of the Canadian National Railways.

We also find these significant words in the Ottawa Journal of this afternoon:

Trade of U.S. Hit Hard Blow by New Tariff American Official in Ottawa Send Report on Budget

Will Cut Trade About $225,000,000

Canada's new tariff will affect American trade with the Dominion "adversely in most instances" to the amount of $225,000,000, it is estimated in an analysis of the Dunning budget from the United States point of view, which has been forwarded to Washington by Lynn W. Meekins, commercial attache, and A. H. Thiemann, assistant trade commissioner of the United States in Ottawa.

In connection with the fruit and vegetable schedules, dealt with at some length by the hon. member for Yale, I want to correct some misstatements which have been made in the press during the last few days. A despatch appearing in the Toronto Star of May 9, 1930, has this to say:

Raise In Vegetable Prices Has Come with New Tariff.

The article continues to quote the prices of different commodities as of May 1 and as of May 9, as follows:

Retail Price May 9 10 cents bunch 15 cents head 30 cents dozen 15 cents each 30 cents pound 30 cents head 25 cents-30 cents quart 20-25 cents bunch 10 cents bunch 10 cents bunch 30 cents dozen

Commodity

Carrots

Head Lettuce.. ..

Bananas

Grapefruit

Tomatoes

Cauliflower

String beans

Celery

Beets

Asparagus.. .. .. .

Spanish oranges.. ..

Retail Price May 1

3 bunches 25 cents 10 cents head 25 cents dozen 10 cents each 20 cents pound 25 cents head 15 cents-20 cents quart 15 cents bunch 3 bunches 25 cents 3 bunches 25 cents 25 cents dozen

In looking over these items and Comparing Spanish oranges have not been changed in them with the tariff schedules we find'that the any way, but apparently someone took ad-rates on bananas, grapefruit, string beans and vantage of the fact that there was a new

The Budget-Mr. Bothwell

budget in order to raise the prices to the consumer. In connection with cabbages, on which there is a specific duty of one cent per pound, the increase in price would amount to about two-fifths of a cent a bunch or roughly two cents on three bunches, but the *rice has been raised five cents. On cauliflower it would mean an increase of a little less than 3 cents and they have raised it 10 cents; on celery it would mean an increase of | of a cent per bunch, and they have raised it 5 to 10 cents; on tomatoes the same ad valorem duty is in effect, and there is absolutely no change; on spinach there is an increase of i of a cent per pound, and on that particular date, May 10, the price of spinach was 50 cents, whereas on the day before it was $1.25; on head lettuce it meant an increase of f of a cent per head, and they increased the price 5 cents, and on asparagus the price was increased from 3 bunches for 25 cents to 10 cents a bunch. The latter is approximate because I was not able to obtain an exact quotation on asparagus.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

James Houston Spence

Liberal

Mr. SPENCE:

What is the hon. gentleman quoting from; what newspaper did he get that information from?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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?

An hon. MEMBER:

None of your business.

Topic:   THE BUDGET
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LIB

James Houston Spence

Liberal

Mr. SPENCE:

There is not a word of

truth in the whole thing.

Topic:   THE BUDGET
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LIB

Charles Edward Bothwell

Liberal

Mr. BOTHWELL:

This is obtained from the Toronto Daily Star.

Topic:   THE BUDGET
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LIB

James Houston Spence

Liberal

Mr. SPENCE:

I just thought of the Star.

Topic:   THE BUDGET
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Good night!

Topic:   THE BUDGET
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LIB

James Houston Spence

Liberal

Mr. SPENCE:

There is not a word of truth in the whole thing.

Topic:   THE BUDGET
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LIB

Rodolphe Lemieux (Speaker of the House of Commons)

Liberal

Mr. SPEAKER:

Order.

Topic:   THE BUDGET
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LIB

Charles Edward Bothwell

Liberal

Mr. BOTHWELL:

Those are the facts.

There is other evidence in addition to that offered by the Toronto Star. The hon. member will have an opportunity of hearing witnesses at any time he desires, because they are here in the house. Those witnesses have made inquiries as to the increased prices asked, and have also figured out the difference in prices.

Topic:   THE BUDGET
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LIB

James Houston Spence

Liberal

Mr. SPENCE:

There is not a word of

truth in the whole statement.

Topic:   THE BUDGET
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LIB

Charles Edward Bothwell

Liberal

Mr. BOTHWELL:

In figuring out the"

changes, we have taken into consideration the changes made in the tariff. Besides the quotation I have used, there are other facts which can be presented to show that these increases were suggested by the trade.

2419-129J

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PRO

Milton Neil Campbell

Progressive

Mr. CAMPBELL:

Did I understand the

hon. gentleman to say that there was no change in the tariff schedule on tomatoes?

Topic:   THE BUDGET
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LIB

Charles Edward Bothwell

Liberal

Mr. BOTHWELL:

No, I said there was no change on the 10th of this month. On that day tomatoes were quoted under the ad valorem rate, and there has been no change made in that rate.

Topic:   THE BUDGET
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PRO

Milton Neil Campbell

Progressive

Mr. CAMPBELL:

The tariff provides that the rate shall not be less than 2 cents a pound; that is a large increase over the old tariff.

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May 13, 1930