Mr. SPEAKER:

The hon. gentleman has spoken for forty minutes.

Mr. E. E. PERLEY (Qu'Appelle):

Mr. Speaker, I can hardly be accused of having trespassed very much on the time of this house, but I should like to make a few observations with respect to the budget, dealing more particularly of course with those items having to do with agriculture.

First I should like to express my congratulations to the Minister of Finance (Mr. Rhodes) on the splendid way in which he presented the budget. Certainly it was a timely and very concise review of the whole financial situation of Canada as well as of the

record of the government during the past year. I should hesitate to participate in the debate at this time, Mr. Speaker, if it were not for the fact that I represent an agricultural constituency in the province of Saskatchewan, and I consider it my duty to express to the government the appreciation and satisfaction with which the budget will be received in the constituency of Qu'Appelle.

I realize that it would be almost impossible to get unanimous agreement in this house on any matter of policy, but I think there are two or three points on which all hon. members should agree. When we consider the general situation to-day surely no one would expedt the Minister of Finance to bring down a balanced budget. With existing world conditions, the uncertainty of trade, fluctuating prices, ever decreasing revenues and our fixed and uncontrollable expenditures, how could we have a balanced budget? In the next place I think no government since confederation has been faced with a situation more difficult or critical than that which has faced the present government. The Prime

The Budget-Mr. Perley (Qu'Appelle)

Minister (Mr. Bennett) and his colleagues have had to make serious decisions, not after days of deliberation but on the spur of the moment, many of them affecting not only our national credit but the very life blood of our country. A wrong decision or a wrong step might easily have spelled disaster, but we on this side of the house believe the government have met every reasonable demand that has been made.

We expect reasonable and constructive criticism, Mr. Speaker, but beyond that I think we have a right to expect fairness and cooperation in dealing with a difficult situation. The depression has been world wide, but I think in some respects we can charge the late Liberal administration with some knowledge that the depression was coming on and with a failure to take any action to meet it. In proof of that I need only refer to the statement made by the late Sir Henry Thornton before the railway committee, I think in 1931. He said that as early as 1928 he had warned the government of the disaster that was coming, and he justified that statement by showing that the railway revenues were falling rapidly. That was in 1928. Then in 1929 we had what was known as the pork barrel year for the Canadian National Railways. In that connection I need only refer to the speech that was made by the present leader of the opposition in that year, in his famous five cents speech. What was that a reply to if it was not to a request for help from the western provinces to relieve the unemployment situation? I might also refer to the statement made by the Hon. Charles Dunning, in his final message to the Canadian people when he was leaving office. He said that it was their duty, realizing that the incoming government would have to deal with very serious problems in the most critical period in bur history, to give the government their moral support. But what kind of support have we had, Mr. Speaker? We have had nothing but adverse criticism from the opposition, and the serious and critical situation in this country has been capitalized to destroy the morale of the Canadian people and their confidence in this government.

I wish now briefly to review' some of the things which this government has done particularly for agriculture since taking office. In the first short session in 1930 two measures were introduced, the first granting $20,000,000 for unemployment relief, and the other dealing with some two hundred odd items in the tarriff, being those items which the Prime Minister and his government believed would

do most to correct the adverse trade balance at that time. I may say that that increase in the tariff had the desired result.

Then in 1931 we had a complete revision of the tariff, and after that revision the average percentage of increase in the whole tariff was only slightly more than under the regime of the Liberal party. True, there were many items in the tariff which received a considerable increase but, in the words of the Prime Minister at the time, this raising of the tariff was used as an instrument in the hands of the government to correct the unfavourable trade balance, and, Mr. Speaker, it had the desired result. Up to that time we had an unfavourable trade balance of 8103,000.000, and I was pleased the other day, as I am sure were all hon. members of the house, to hear the Minister of Finance (Mr. Rhodes) and also the Minister of Trade and Commerce (Mr. Stevens) say that this year we shall have a favourable trade balance of some $70,000,000. What has that meant? It has meant that an unfavourable trade balance of $103,000,000 has been changed to a favourable trade balance of $70,000,000, or a change for the better of $173,000,000 odd. It has meant the difference between solvency and bankruptcy for this dominion.

In the budget brought down by the Prime Minister, then acting as Minister of Finance, in the session of 1931, the bonus of five cents a bushel for wheat was granted to the western farmer. I am particularly interested in that bonus as I was the first member of this house to move on the floor of this chamber for such a bonus to agriculture. I did so on April 13, previous to the bringing-down of that budget. When that proposal was brought down in the budget hon. members of the opposition, particularly those from the west, opposed it strenuously. But under that bonus, Mr. Speaker, the government has paid out some $12,000,000 to the people of the western provinces, and I would ask, when has any other government done such a splendid thing for agriculture in this country? The hon. member for Melville (Mr. Motherwell), speaking a day or two ago said that during that session the Liberals for two months less two days opposed the granting of that bonus, trying to show that it would go to the exporter or to the railway companies, and not to the farmer. That is not a correct statement, because it will be well within the memory of hon. members who were in the house at that time that after the Minister of Finance had brought down his budget, some two weeks

The Budget-Mr. Perley (Qu'Appelle)

later he made it clear to the house and the country that the bonus would go direct to the farmer by a separate cheque.

Mr. MOTHERWELL:

Quote your authority.

Mr. PERLEY (Qu'Appelle)): My authority is the Hansard of that year.

Mr. YALLANCE:

Read it.

Mr. PERLEY (Qu'Appelle):

The hon. member for Melville also stated that they had opposed the bonus strenuously. In that connection I should like to quote from the report of a speech made by the hon. member in Saskatoon on November 25, 1931. He is reported as follows:

The five cent bonus on wheat was held by the speaker of no use to the farmer. Continuing, the hon. member recounted the fight put by the western members in the opposition to the five cent bonus on wheat, and added that they had had a hard time to convince the government that the bonus would not go to the exporter.

There never was any intention of the bonus going to the exporter or to the railway companies or to anyone but the western farmers, and at the very time my hon. friend was speaking he knew that the bonus had been paid for two and a half months to the farmers by separate cheque.

I would further remind the house of the guarantee which this government made to the wheat pool in Saskatchewan. This government guaranteed the sum of 815,000,000 to that great cooperative organization in Saskatchewan, and that sum has not yet been repaid, but it saved the organization from insolvency, and saved also the farmers of western Canada. The credit can go to no one but the Prime Minister and the government of Canada. That guarantee to the pool has saved the investment of thousands and thousands of farmers in the province of Saskatchewan who have an investment, small in some cases, it is true, but considerable in others, in each one of the twelve hundred elevators in the province.

It is also within the memory of this house what a strenuous time we had in the session of 1932 getting the relief measure through the house to grant seed to the farmers of Saskatchewan. That measure was held up for six long weeks and not until seeding time was upon us and the farmers required the seed was the government able, by the application of closure, to get the measure through this house in order to make the distribution of seed possible. That is something which the

western farmers will never forget. They will never forget the obstruction of the opposition in this house to that measure.

Then again last fall we had this government coming forward and doing something for agriculture by supporting the wheat market. The grain trade and the western farmers in the fall of 1932 were faced with a very serious situation owing to the fall in the price of wheat, and the government, after consulting with all the interests concerned, the grain trade, the wheat pool and the banks and the premiers of the three prairie provinces, decided that the best thing to do was for this government to support the market. What has this meant? I need only refer hon. members to the statement made by Professor Swanston of Saskatchewan university. He is one of the leading economists and he stated that this action by the government averted a national calamity and saved the farmers of western Canada many millions of dollars. The hon. member for Shelburne-Yarmouth (Mr. Ralston) chooses to call it gambling, but call it what you will, it was the right thing for the government to do. In the very near future when this plan shows a handsome profit, hon. members opposite no doubt will want to know what we are going to do with the profits.

I come now to the Imperial economic conference agreements passed last October. What has been the result of these agreements? There has been a surprising increase in our export trade, so much so that Canada has attained fourth position in trade with Great Britain. During the first six months of the crop year 1931-32 our exports of wheat to Great Britain amounted to 66,705,000 bushels while for the same period in the crop year 1932-33, they amounted to 112,529,000, an increase of one hundred per cent. The increase in our exports of flour to Great Britain for the same period amounted to twenty per cent, while the increase in bran and shorts amounted to 645 per cent. Our exports of oats during the same period of 1931-32 totalled 5,153,000 bushels and in 1932-33 they had increased to 7,500,000 bushels, an increase of forty-five per cent. The increase in the exports of barley was from 68.000 bushels to 190,900 bushels, an increase of three hundred per cent. The exports of bacon for the first two months of 1931 amounted to only 120,000 pounds; for the first two months of 1933 they had increased to 4,264,624 pounds, an increase of some 3,450 per cent. Canada can increase her exports of bacon to the United Kingdom thirteen times before she reaches the limit of her quota.

The Budget-Mr. Perley (Qu'Appelle)

The increase in the export of ham was 158 per cent. Because of the trade agreements the embargoes which previously existed against our cattle entering Great Britain have been removed. The result has been a revival in the exporting of cattle and it is quite possible that this year we will export 100,000 head of cattle. Such a movement would relieve the domestic market to a great extent.

I come now to another item in which I am particularly interested as it affects the province of Saskatchewan-poultry. The records show that for the last ten months of 1931 our exports of poultry amounted to 56,175 pounds while for the same period in 1932 they had increased to 1,203,000 pounds. A trial shipment of 800,000 pounds of dressed turkeys was made last December as an experiment under the new agreement. These turkeys were dressed by the individual farmers in Saskatchewan to government standards; each bird was tagged separately and they all graded very high. The farmer received an advance of eight cents per pound and those birds sold on the British market at the top price of thirty cents per pound. Under the adverse exchange of twenty-five per cent they netted the farmer nineteen cents per pound, but under the present rate of exchange and with the help of the agricultural stabilization plan a similar price would net the farmer twenty-four cents per pound. These birds were superior to the home grown British bird and sold at a premium sufficient to overcome the adverse exchange. In 1932 Great Britain imported 74,000,000 pounds of dressed turkeys, fifty per cent having come from Russia. The parties who went over in charge of this shipment returned w7ith an order for 2,000,000 pounds of turkeys. The whole shipment came from Saskatchewan. While it has been known for many years that we produce the best wheat in the world, we now have the record for producing the best poultry. I hope that the report on this trial shipment will be distributed among the farmers of western Canada so that advantage may be taken this fall of similar shipments.

Mr. SPENCER:

Alberta has taken more

prizes in wheat than has Saskatchewan.

Mr. PERLEY (Qu'Appelle):

They may

have taken more, but Saskatchewan always takes the first.

I could refer to other primary products such as cheese, eggs, tobacco, apples and so on; I could refer also to the increase which has taken place in our export trade to countries other than Great Britain, but I have not the time available. Not only has the

volume of exports increased but the value has increased even in the face of adverse exchange rates.

We come now to the budget. I was very much interested in hearing the Minister of Finance (Mr. Rhodes) announce the setting up of an agricultural stabilization fund. Such a fund will materially add to our advantages in the British market. In the case of a steer weighing 1,200 pounds it will mean practically another $10; it will mean two cents on every pound of bacon; it will mean eleven cents for every hundred pounds of milk used in the manufacture of cheese and it will mean three cents per pound on our poultry. The total results will mean a possible distribution this year of $10,000,000. For the information of the house, I would say that since the announcement of the budget the price of hogs on the Winnipeg market has increased very materially. Not only will we have the benefits from a possible distribution of $10,000,000 but there will be an added stabilization and support of the domestic market. Upon all occasions the opposition has opposed bonusing of any kind, but what do we find now? They are opposing this splendid arrangement because it is not applied to the export of all primary products. They know that that would be impossible as it would take $100,000,000. Where would the money come from? However, it would seem that at last they 'have been converted to the principle of bonusing. When we have this splendid arrangement, why do they not come forward and support it as they should. I challenge hon. members opposite from Saskatchewan to go back to their respective constituencies and explain why they oppose this budget.

Mr. YALLANCE:

The trouble is that

most of us, under the new redistribution, will not have constituencies to which to return.

Mr. PERLEY (Qu'Appelle):

While the

hon. member has one now, he would not have one anyway after the next election.

Mr. YALLANCE:

I am willing to take a

chance on that.

Mr. PERLEY (Qu'Appelle):

They know

wheat is enjoying, under the agreement, a preference of six cents in a sheltered market where it is agreed to take 150,000,000 bushels more, and it would be impossible to bonus wheat in a market where there is such a surplus.

Let me now deal with the subject of butter. True, it is not bonused, but the reason is that our production of it is not on an export basis, and I am surprised to hear

The Budget-Mr. Perley (Qu'Appelle)

the hon. member for Melville (Mr. Motherwell) even mention the word "butter," that cheap spread, as I think he called it in his speech; I think that was the term he used. He knows the government have had many decisions to make and have been confronted with many difficulties in prohibiting the importation of butter in order to preserve the home market for our producers. I have been reviewing Hansard and1 I find that during 1923, when the hon. member was Minister of Agriculture, he introduced an amendment to the Dairy Industry Act, as reported on page 4251 of Hansard of that year, to provide for the importation of renovated butter. Now, everyone knows what renovated butter is-

Mr. MOTHERWELL:

I never did.

Mr. PERLEY (Qu'Appelle):

It is butter

that is tainted, mouldy and not eatable. After it goes through a certain process by the use of chemicals, it is called " renovated," and the hon. member wanted that to be permitted to be imported to compete against butter produced by our own dairymen. What a wonderful gesture in favour of agriculture!

Mr. MOTHERWELL:

Better than oleomargarine.

Mr. PERLEY (Qu'Appelle):

We all

remember how for six weeks during last October and November hon, gentlemen opposite wailed about the adverse exchange; they admitted that the agreements were all right, but, oh, they would be nullified by the exchange! Well, we see the effect of the agreements in the increase in our trade, and now when the government has made provision for correcting the exchange, why do hon. gentlemen opposite not support it?

This budget will do much for agriculture. It certainly will encourage the farmers of Saskatchewan and of western Canada generally to change their system from simply grain growing to more diversified farming. This will mean that millions of acres fewer will be seeded to wheat; it will help in the disposition of our surplus and it will, as I say, encourage our farmers to go into a better system of farming. For the information of hon. members I might say that Saskatchewan's capacity to multiply her production and to produce new wealth is practically unlimited. In view of the fact that in western Canada in ten years we produced $6,000,000,000 of new wealth, I venture to say that if we have normal climatic conditions-and tha"t is all we need-we can repeat the production. That time will come and we shall be on the spot to take advantage of it. The govern-

Mr. J. R. HURTUBISE (Nipissing):

Mr. Speaker, I do not purpose to go into a discussion of the financial situation of our country, because I do not pretend to be a financial critic. However after following the debates in the house and considering the downward trend of our financial situation I feel it my duty to make a few observations and express my sincere opinion. I hope no hon. member will suggest that my statements will be prejudiced or biased in any way.

At the outset may I follow the example of hon. members who have preceded me and congratulate the hon. Minister of Finance (Mr. Rhodes) upon the able manner in which he delivered his budget speech. I fully appreciate the work and worry it involved. May I also congratulate the hon. member for Shel-burne-Yarmouth (Mr. Ralston) upon the masterly way in which he replied to the budget speech. My further congratulations would be extended to the hon. member for South Huron (Mr. Golding) who in his maiden speech acquitted himself so well. Even with my years of experience I do not believe I could hope to do as well.

My remarks may appear obvious, but sometimes in life we do not see the things that are staring at us and within our grasp because of the allurement of distant attractions or because of our entanglement with matters foreign to our needs and ideals. Economically our country is in the most critical situation of its history. The situation is such that no time should be lost in arguing utopian theories which have been offered to the world, put into practice 53719-2274

from time to time in different countries and discarded as inefficient. To-day we have reached the point where privileges to special interests should be set aside and forgotten. Let us turn our minds to governmental measures and regulations which will ensure to our country liberty, security and progress.

I hope those who have satisfied themselves as to the impracticability of their doctrines and policies will prove their good statesmanship by discarding those policies and adopting radical measures which will be for the good of the country as a whole. To accomplish anything we have to be broad enough to admit our mistakes. Much has been said about capitalism. My submission is that the capitalistic system has given a great impetus to modem progress. However it has brought with it great abuses which are the cause of our being on the verge of a catastrophe. Our aim should be not to do away with such a system, but to correct its defects and avoid future disasters.

Our main duty should be to face our obligations and to honour them. But to-day we are working under a great handicap. The world is so fettered with war debts that its capacity to pay is crippled. The productive capacity of nations and individuals has been overtaxed, and unless some concession is made we are close to a general 'breakdown the effect of which cannot be imagined. I hope that at the world economic conference to be held in London there will be enough men of courage and Christian spirit to bring about an economic disarmament which will release international trade, promote sympathy and cooperation between the nations, and rid the world of this exclusive and bigoted nationalism. In our country we have come to the time when we cannot borrow any more money, and we wonder if we will be able to pay our interest and amortize our debt as it stands. For some years past, for each $100 we spent we had to borrow $34 and add it to our debt. This cannot continue. Great Britain was faced with the same situation but she took means to get out of the impasse and to-day she is in a very satisfactory condition compared to other nations of the world.

I do not believe that all the schemes advocated lately will cure our present financial difficulties; neither inflation, reflation, technocracy, socialization, confiscation of capital, nor "cooptisation," will replace a well balanced and controlled capitalistic system. I am convinced that the state can and should prevent the concentration of wealth and potential

The Budget-Mr. Hurtubise

wealth in the hands of a few, and thereby control the sources of credit of t'he country. We should never have permitted the creation of fictitious capital and the watering of stocks with the support of the banks. It has drained the savings of the public, who have been fooled under the paternal eye of the state, and to-day when the state wants to float a loan it finds the "bas de laine" empty, and instead of being helped out of the crisis by its citizens it is faced with the obligation of helping those same citizens on whom it had relied. I hope the lesson will make the state wiser in the future. We have come to a point where the positions of the different governments, federal, provincial or municipal, should be well-defined. The present government, which did not want to meddle with provincial or municipal affairs, has so meddled with them, has promised so many things before, during and after election, that we have a situation now where everybody is leaning on it for support. The federal government should keep out of purely provincial and municipal matters, withdraw from business enterprises, and adhere to functions of purely legislative and regulatory nature. If the provinces want to go into public ownership, old age pensions, mothers' allowances, accident insurance and highway construction, let them do so, but the federal government should be wise enough to keep to its constitutional functions.

I listened with great interest to the debate on the resolution of the hon. Minister of Labour (Mr. Gordon) to renew the Relief Act of 1932 as amended. I have much sympathy with the minister in his task of dealing with unemployment. The other evening when he and the hon. Minister of Trade and Commerce (Mr. Stevens) were pleading for cooperation and sympathy I could have told them they already had mine, because I believe that with the methods employed to-day, that is since 1930, they have only been experimenting, and instead of making progress they have become engulfed. They have been marking time, not adopting any measure of a national, practical or curative nature. They have only used palliative measures. In their ambition to implement their promises to end unemployment, "in giving work instead of conferences," they have forgotten that the situation is national in character, that the machine will never be able to reabsorb the hands which it has discarded, that this situation is likely to last for a longer period than might be expected, that some national policy such as suggested by my right hon. leader (Mr. Mackenzie King) will have to be adopted. There is still time

to adopt such a measure, to call to the help of the government the best and most competent minds of the provinces and the dominion, and to make a classification of the unemployed as suggested by my hon. friend the member for Temiscouata (Mr. Pouliot), that is of common labourers, technical workers, farm hands, trades and professions. Then the government could prepare a proper program; and not deal with the matter in a haphazard way, giving to provinces and municipalities money over which it has no control, and which often is unwisely spent and sometimes misappropriated. Up to now we have spent $123,000,000 for which we have to be taxed, and which has not ameliorated the general condition one iota.

The only part in the Minister of Labour's program which I believe is sound and national in character is the back to the land movement, to which he has given special attention and upon which I sincerely congratulate him. In that I am with him 100 per cent. For two years I have cooperated with the municipal and provincial representatives, and I am glad to say that in my district we have succeeded very well. As long as it is handled by people who have at heart the success of the plan, and who are not primarily interested in keeping an easy job, it will be a success, and will be a great help to redistribute our population on its normal basis.

Some may say: What is the use of putting people on farms when so many are now being dispossessed by foreclosures caused by the heavy burden of taxation and the lack of protection by legislation? This brings me to the farming situation. I believe agriculture is our main industry. I repeat what I said last year; a country with a prosperous agricultural population is a prosperous country. But what chance has the farmer had in recent years? He has been one of those who suffered most from the application of the Conservative policies these last three years. By reason of a narrow national and imperial trade policy the doors of the markets of the world have been slammed in his face, and to-day he can only dispose of a small portion of his products, for which nevertheless this government takes great credit.

Seeing the great malaise in the agricultural community the government has proposed a stabilization fund. Already the press has proclaimed the great benefits that will accrue to the farmer. But wait for the boomerang from this legislation as a result of its discriminatory character.

It has started already.

The Budget-Mr. Hurtubise