May 5, 1941

LIB

James Lester Douglas

Liberal

Mr. DOUGLAS (Weybum):

You tell us.

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

Paul Joseph James Martin

Liberal

Mr. MARTIN:

I understand that under the present training scheme it is hoped to train something like 50,000 students in thirty-five technical schools.

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

Thomas Clement (Tommy) Douglas

Co-operative Commonwealth Federation (C.C.F.)

Mr. DOUGLAS (Weyburn):

By what date?

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

Paul Joseph James Martin

Liberal

Mr. MARTIN:

I am speaking from memory, but I think it will be within six months. I am not saying that this is all that we should do, but I think it ought to be mentioned.

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

Victor Quelch

Social Credit

Mr. QUELCH:

The hon. member states that this year we shall train 50,000 men, but at the same time the minister tells us that this year we shall have to absorb 300,000. If we are going to train only 50,000, we shall still be 250,000 short. Again I stress the fact that we are not going at this problem as energetically as we might. If we can train men for the army in the time in which we seem to be able to train them, why cannot we do the same thing in connection with industrial life? I am not suggesting that these men should be conscripted, but they should be offered a fair and decent wage.

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

Paul Joseph James Martin

Liberal

Mr. MARTIN:

I agree with that.

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

Victor Quelch

Social Credit

Mr. QUELCH:

On several occasions I have complimented the minister upon the general policy which he outlined in his budget of 1939. He rather reiterated that stand in his remarks on April 29. There are three main points with which I should like to deal. First, the minister stated that the government will insist upon equality of sacrifice according to ability to pay. Second, he stated that the country was to be brought as rapidly as possible to the full use of its resources and, third, he stated that as far as possible we were to follow a pay-as-you-go policy. When I spoke on March 20 I referred to this declaration of policy and deplored the fact that the government had not lived up to this declaration. I should like to deal briefly with some of these points from a slightly different angle.

First, there is the question of equality of sacrifice according to ability to pay. Generally speaking, I think the increases in taxation have been applied on a fair basis, with some

exceptions with which I shall deal later, perhaps when we are in committee. I have in mind the gas tax, the sugar tax and the need for the national defence tax exemption being raised from S660 to $750. I intend to refer also to the imposition of the sales tax upon lumber and building materials at a time when there is a shortage of houses. I consider this the most inopportune time to apply the sales tax to these materials. I wish, however, to congratulate the minister upon not having raised the sales tax. I wish it had been possible to reduce it because this is a tax which falls most unfairly upon the poorer classes. Under this tax the poor are paying upon practically all of their income, while the wealthy pay only upon a percentage.

Apart from taxation, I do not think the minister can possibly ask us to believe that the government is seriously and conscientiously trying to apply the principle of equality of sacrifice. I ask the Minister of Finance to study the new wheat policy imposed upon this country, not by parliament but by order in council. I ask the minister to study the agricultural situation which exists in western Canada to-day. I ask the minister to read the speeches made by the Minister of Agriculture (Mr. Gardiner) in this house and over the radio. I should like to quote from the remarks of the Minister of Agriculture, as follows:

They know that this policy is taking money out of their pockets and making it possible for this dominion to finance the war to the extent of at least $100,000,000 more than would be the case if the government did for the wheat growers of the west what they are doing for most of the other people of Canada.

The Minister of Agriculture points out that the wheat farmers are being called upon to make a greater sacrifice, to the extent of $100,000,000, than any other body of people. If the farmers of western Canada had been enjoying a period of prosperity there might have been some justification for this action, but such has not been the case. The farmers of the west have been suffering from long periods of low prices and drought. This ghastly policy is likely to have most serious repercussions. I am not speaking idly when I say that I am really worried over what may happen as a result of this absolutely unjustified action.

Then to add insult to injury, in addition to imposing a policy of this kind upon western Canada the government has imposed a three cent gasoline tax. Perhaps I should read what the minister said with regard to this tax. I quote:

The imposition of a much higher tax than three cents coupled with a system of refunds to tourists, farmers, fishermen and others was considered. It has been decided, however, to recommend a smaller tax and make no provision for refunds.

The Budget-Mr. Quelch

The minister pointed out that it would cost too much to administer the higher tax with refunds and that, as a rule, refunds are abused. There would be no difficulty in this regard in so far as Saskatchewan and Alberta are concerned. In both these provinces the farmers use a coloured gas which has been devised for the very purpose referred to by the minister. The use of this gas makes it impossible for the farmer to abuse the refund principle. I suggest to the minister that the three cent tax should not apply to coloured gas. There would be no question of refund involved; it would simply mean that the tax would be imposed upon the other types of gas and not upon the coloured gas.

At one time in Alberta, and I believe in Saskatchewan, it was the custom for a farmer to pay the usual price for gasoline. He would then apply for a refund upon that portion of the gasoline which was used on his farm. This privilege was abused, so the government put out a coloured gas which was to be used in tractors. The farmer was permitted to buy this gas without paying any tax, but if a policeman stopped his car and found coloured gas in the tank, he could be prosecuted. This gas was to be used only on the farm and not on the road.

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

John Power Howden

Liberal

Mr. HOWDEN:

Is the hon. member talking about distillate or gasoline?

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

Victor Quelch

Social Credit

Mr. QUELCH:

I am referring to gasoline for tractor use.

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

John Power Howden

Liberal

Mr. HOWDEN:

Most tractors use

distillate.

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

Victor Quelch

Social Credit

Mr. QUELCH:

No, most of them use gasoline because of their high-compression engines.

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

Manley Justin Edwards

Liberal

Mr. EDWARDS:

The hon. member admits the correctness of the minister's contention with regard to the abuse of the refund principle.

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

Victor Quelch

Social Credit

Mr. QUELCH:

It can not be abused in so far as Alberta and Saskatchewan are concerned.

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

Manley Justin Edwards

Liberal

Mr. EDWARDS:

After all, the budget applies to all provinces.

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

Victor Quelch

Social Credit

Mr. QUELCH:

Then I suggest that the other provinces can obviate this difficulty by following the example of Saskatchewan and Alberta. So much for the agricultural industry.

I wonder whether the minister considers that we are doing all in our power to lighten the burden of sacrifice of the Canadian soldier. Our soldiers are making the major sacrifice to-day, and I think we are all agreed that everything possible should be done to lighten their burdens. There is one way in which we could remove a great deal of the 14873-161

dissatisfaction which exists to-day in the army. That is the question of giving free railway passes for embarkation leave and furlough. I am not suggesting for one minute that every time a soldier wants a pass he should be given one free, but 1 do suggest that as regards embarkation leave, and furlough, which is granted every six months or yearly, the soldier is entitled to a free pass. The soldier is not consulted where he shall be trained, and he can be moved from one end of Canada to the other. Before embarking on a journey from which he may well never return, he naturally desires to see his loved ones. This may cost him in railway fare anywhere from fifty to ninety dollars, and very often he has not the money and must write his wife or other relative for the railway fare. We are all agreed, I think, that that is not a satisfactory condition, and undoubtedly it is causing a great deal of discontent. It is little things like that which become magnified in the minds of the soldiers and help to form a fertile ground for communistic literature and fifth-column advocates.

Another point to which I should like to refer in passing is the pension bill, to which I referred the other day, which destroys the insurance principle of the old Pensions Act. Not one member of the house was prepared to defend the destruction of that principle. Even the Minister of National Defence (Mr. Ralston) was not enthusiastic about it. Then we find out that the person responsible for having that bill drafted was the Minister of Finance, who called a meeting to draft the bill. So much for the declaration of equality of sacrifice.

Next to the government's declaration regarding maximum production. I have already dealt at some length with the question of shortage of skilled labour, which I think is one of the main causes of production being held up at the present time. I pass that byand go on to the next point, with regardto the government's declaration to follow so far as practicable a pay-as-you-go policy. Both the present Minister of Finance and his predecessor have on various occasions attempted to show that this group has advocated inflation. I most emphatically say to-day that at no time has this group advocated inflation, and I doubt very much if there is any group in this house which is more opposed to

inflation than we are.

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

John Horne Blackmore

Social Credit

Mr. BLACKMORE:

Hear hear; or that understands it better.

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

Victor Quelch

Social Credit

Mr. QUELCH:

I would say that it was the failure of the government to maintain production at its maximum level during the

The Budget

Mr. Quelch

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

Paul Joseph James Martin

Liberal

Mr. MARTIN:

Who suggested that that

was the proposal?

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

Victor Quelch

Social Credit

Mr. QUELCH:

If the hon. member will

read any of the letters of the chartered banks, he will find that all of them insist that that is the only place to get it; and the Minister of Finance himself has repeatedly stressed that we sell to the pepole as many bonds as we can. I again say that, had we exercised our power of taxation as we should have, there should not be any surplus money for investment in bonds at this time. We know how a great deal of the money for bonds will be raised. It will be raised by a hidden form of inflation. The chartered banks will lend people the money to buy those bonds, just as the last war was financed in England, with the result that by the end of the war seventy per cent of those bonds were owned by the banks. Customers will be approached by the banks and told that they can borrow money for the purpose of purchasing a bond and that they can deposit the bond with the bank after it is purchased. At a later date, when they become hard up, they will sell the bond to the bank, or, if they are not able to meet their loan, the bond will be transferred. I guarantee that before this war is over, a great part of the issue of bonds will become the property of the banks.

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

An hon. MEMBER:

Where do they get

the money?

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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May 5, 1941