July 9, 1946

LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

Would the hon. gentleman be in favour of raising the exemptions to a level which would lose us $300,000,000 in revenue, thus making the deficit $600,000,000, instead of $300,000,000?

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PC

Harry Rutherford Jackman

Progressive Conservative

Mr. JACKMAN:

If the minister will bear with me for a few moments he will hear some constructive suggestions which I shall presently make. The concessions granted are niggardly and even grudging, even when those applicable to 1946 are combined with those promised for 1947. Taxation is still strongly reminiscent of wartime rates when we no longer have a war. Among the strange arguments the minister cites in defence of his policy is the following:

We cannot secure proper equity and fair treatment if the exemptions from income tax are so high as to exclude most of those receiving incomes.

What right has he to accuse the Canadian people of such a dog-in-the-manger attitude, and how does he reconcile the fact that already many small wage-earners are not and should not be taxed? The majority of the citizens are not made economy-conscious by being included in the tax roll. They merely grouse. Like everyone else, I subscribed to the idea that if a man paid a tax he would be more interested in government expenditures. It was thought to be an excellent investment in citizenship. The result disproves the theory and only leads to the asking of greater "take-home pay". Indeed, it is obviously the minister's desire that taxation be not lifted at the present time. For listen to this:

Moreover, as I have already indicated, the current economic situation in respect of the available volume of purchasing power and current spending trends is not such as to provide an economic justification for reducing taxes at the present time. Lighter taxes are not needed now for the purpose of permitting or encouraging additional private spending in order to maintain employment this year. In fact, if only immediate economic conditions were involved, one [Mr. Jackman. 1

could make a case for temporary higher taxes in order to curb the excess of spending in some directions that is tending to pull prices up.

What an example of a restrictionist policy! This is managed economy with a vengeance, a shining example of how we are to be treated if the brain-trusters are to be allowed to run the affairs of the Canadian people. Let our people be warned by it!

Yet the minister talks about increased production as the primary aim and need of the present budget. So let us see how he would encourage married women to remain at their jobs. I am not speaking of mothers with children to look after, but there are many married women who have not such responsibilities but who are free and who desire to work part time. With the shortage of help in the domestic field and in the needle trades, where work is done at home, to mention only two classes-and one might include some of the able secretaries in the House of Commons-there are many women who will not work beyond the earning of $250 which is allowed them before their husband's taxation is substantially increased. Earned incomes of married women did not reduce a husband's tax exemptions to those of the single man during the urgent need for war production. But now production apparently is not so necessary, and yet the minister preaches production as the chief means of offsetting the calamitous dangers of inflation.

Of course, in theory a married man should not be allowed the marital exemption of $750 if his wife works. I agree. But are we more interested in theory or in production? It is a case of man being made for the theory and not the theory for man.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

Are we not interested in equity and fairness to some extent?

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PC

Harry Rutherford Jackman

Progressive Conservative

Mr. JACKMAN:

I am not going to elaborate an answer to the minister's question. I am interested in production, and I do not believe that the Canadian people wish to adopt this dog-in-the-manger attitude which the minister suggests. If a man's wife is able to work and produce, particularly at the present time when there are more jobs offering than workers to fill them, I say, let her work and give her some incentive; don't reduce the married man's exemption.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

My hon. friend can not have heard the scores of speeches made in this house in the last two or three years on the other side of that question.

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PC

Harry Rutherford Jackman

Progressive Conservative

Mr. JACKMAN:

I am speaking as I see it, as I believe it and as I think I know it will work out. It will help the minister a great

The Budget-Mr. Jackman

deal if he gets more production. He is endeavouring to put the lid on the prosperity and well-being of this country in order to ward off inflation. What the minister wants above all is production, and I am pointing a way for him to get production. Does he want theory? All right. If he wants fairness and equity to a certain degree, all right; but what we are after is production. If the minister thinks there is any doubt in my mind as to which of the two should prevail, I will tell him it is production.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

I will take fairness.

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PC

Harry Rutherford Jackman

Progressive Conservative

Mr. JACKMAN:

I wish the minister would make up his mind whether he wants the production of goods and services to give our people a better life, or whether he wants to keep down production by taking away incentive.

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LIB

Ian Alistair Mackenzie (Minister of Veterans Affairs; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. MACKENZIE:

It is the very opposite.

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PC

Harry Rutherford Jackman

Progressive Conservative

Mr. JACKMAN:

I should be delighted if the Minister of Veterans Affairs (Mr. Mackenzie) would make a contribution to the budget debate in due course. In the six years I have been in this house I have not heard him make any contribution to any budget debate.

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LIB

James Garfield Gardiner (Minister of Agriculture)

Liberal

Mr. GARDINER:

You make a better speech when you are not reading it.

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PC

Harry Rutherford Jackman

Progressive Conservative

Mr. JACKMAN:

We all do that. Sometimes we must refer to our notes; otherwise we should not get as much in. Apparently the minister is following the advice of two sets of brain-trusters who never before have run the economy of a state and just do not know what makes the clock tick. Let us sympathize with the minister in his desire to keep inflation from manifesting itself; which is at the root of many of the government's contradictory policies. Inflation is with us, owing to the inevitable economic sins in financing the most costly war in history. The production of more goods over which to spread the available purchasing power is all to the good, though there are good authorities who believe that by the very process of enlarged production the purchasing power thereby created will aggravate an already strong and inevitable inflation. If there is a way out of inflation I hope the minister will show it to this house. Whatever may be the financial effects of increased production, we know its social effects are wholly good; the more goods and services that are produced, the more there is to divide among our people and the higher the standard of living

The minister asked if I could give him any suggestion in lieu of increasing the exemptions. Here is one which I offer to him,

which I think will help production and help meet the inflation problem. It is my recommendation that some different way must be found to raise a good part of the national revenue, other than that of discouraging enterprise and work. I have already quoted Sir John Anderson's view in that regard. I am not suggesting here that any great part of the load may be dropped; but there is a right way and a wrong way to harness a horse; a man can pull more than he can push, and he can pull more on wheels than he can drag on the ground. To tell a man, whether he wears a blue collar or a white collar, that he will earn less per hour for overtime, because of taxation, just does not work.

While there are some arguments against the extension of the sales tax, there are few when food, which bulks so largely in the average housewife's expenditure, is exempted as L recommend. Very few of our people to-day know there is already a sales tax imposed at the wholesale level. Such a tax does not discourage the worker from working, and there is fairness in a tax policy based on the principle that the more one spends, the more one pays. There is nothing obligatory about paying a tax if one does not purchase; but unfortunately the great growth in instalment sales in normal times is a clear indication that most people will spend if they have the money, and even when they have not. Let the worker have more take-home pay if we are to encourage production. Other indirect or nonincentive destroying taxes must be found if we are to keep our economy in high gear. I may be asked, how does it help in what way we pay our taxes, when they have to come out of the same pocket anyway. The answer is that under the present system the pocket is only half full because the high individual tax rates discourage work, enterprise and production. Under a system such as I propose the same amount of taxes would have to be paid, but we would have fuller pocketbooks out of which to pay them.

May I now say a word on the effects of the government's monetary policy and deficit financing. The pumping of money into the circulation system has had the effect of lowering interest rates. Just as everything goes up in price when there is more money than things to spend it on at the old price level, so bonds went up in price because people had to invest their money somewhere and there was little else to spend it on. The government encouraged us not to spend, anyway. Of course this form of inflation was all right because the

rhe Budget-Mr. Jackman

government was the producer of the bonds, and the only place one approves of a ceiling is on what someone else has to sell, not on what one produces. So investors have bought government bonds at inflated levels, and the return on their investment has been cut about in two, while increased taxation has almost reduced this income by half again. In the meantime, nearly all other groups have had some increase in take-home pay in recognition of the increased cost of living, the white collar group least of all. As a measure of great solicitude, the minister now offers the poor retired widow, who may or may not have children to educate, relief by way of increasing the exemption from the special surtax of four per cent on investment income from $1,500 to $1,800. In other words, this munificent concession, after all he has done to the retired man with a small income on which to keep 'himself, is to give him relief from the four per cent surtax on $300 more of income or, Mr. Speaker, $12 per annum, about the price of a new pair of shoes. Obviously the minister did not have the wealthy investor in mind. I hope he did not spend too much time in working himself up to this pitch of generosity.

Turning now to the corporation tax, we find there is no implementing of the now well recognized unfairness of the double taxation of business earnings, first in the hands of the corporation and then, what is left of the same earnings, in the hands of the individual. The latter is the only one who can consume these earnings; and it was confidently expected that the government would at least make a start in eliminating this feature of double taxation which is generally conceded to be unfair. As with so many other aspects of the budget, one must continue to live in hope. The reduction of the minimum corporation tax from 40 per cent to 30 per cent, though this may only make way for a provincial levy, was a needed step. The ordinary corporation tax was 18 per cent at the outbreak of war, and the additional 22 per cent, making 40 per cent in all, was taken from the Excess Profits Tax Act. This is once again proof that this tax-because even if a business earned less than before the war the higher tax prevailed-was always a misnomer. It was really-and I am sorry the previous speaker is not in the chamber at the moment-an excess tax on profits. A tax of 30 per cent or more on business is still a high tax, but we cannot spend on social services if we do not tax, and business will do its best to create jobs under the present imposition, thankful even for small mercies.

The excess profits tax was a fair one in many respects, because no one should be allowed to profit from the emergency and sac-

TMr. Jackman.]

rifice of war and from the forced spending in unlimited volume caused by the war. Today's business is no longer the result of war expenditures, and the average 1936-39 earnings on which the excess profits tax is based has become an anachronism. Just as the island of Manhattan was once sold by the Indians for $24; just as valuable farms in western Canada were once free homesteads, you cannot turn back the hands of time. It is particularly hard on young businesses, and ten years is a long period in the life of any company. Great Britain has recognized these facts and is doing away with the excess profits tax at the end of 1946 and, of course, Great Britain has no corporation tax as we know it. The United States did away with the excess profits tax at the end of 1945. Only Canada is left with this deterrent, to be 15 per cent additional to the ordinary corporation tax of 30 per cent in 1947, a deterrent particularly to small and growing businesses. How can they expand and create employment if they cannot plough back any earnings, just as a farmer ploughs back a crop of clover.

Let me give an example of why Canada cannot afford a substantially higher corporation tax than obtains in the United States, much less an excess profits tax which that country wisely abolished. There are over $4 billion of American investment in Canada, much of it consisting of investment in branch plants. If the American company finds that it can get more profit after tax, retained profit, from its American plant than from its Canadian, it is quite obvious where any goods for export are going to be made. Employment is thus created in the United States which otherwise would have gone to Canadian workmen. Another manufacturer informed me of a developing export business with Newfoundland in competition with firms in the United States. Since the American was allowed, under their tax system, to retain a larger share of his profits he could quote a closer price than the Canadian and hence the business went to the United States.

In his budget remarks the minister said, "this tax has distinct weaknesses and limitations in normal times and it is not to be accepted as a permanent part of our tax structure. Experience, however, has shown, he says "that we are still living in highly abnormal times, the shadow of war is still upon us." What of the United States, and what of the not to be compared strains and uncertainties upon Great Britain?

Is it likely that we shall ever live in a complacent world? Let Canada get back to a fiscal basis on which she may proceed and progress. The difficulty which the minister faces

The Budget-Mr. Herridge

at every turn is that he has not yet made up his mind whether our economy needs to be encouraged or whether it needs to be held in check. On the one hand, he wants to see production increased; and, on the other, he does not, particularly if it means making the people prosperous and putting more pressure on the price ceiling. He wants to have his cake and eat it too. He asks for more production so that he can hold his price ceiling line, and then he turns around and destroys the incentive for both individuals and businesses without which there is not likely to be more production but less. Already the index figure for the volume of manufacturing stands at 190 as compared with 271 in April, 1945, and 291 in April, 1944. Not since John Bunyan's "Mr. Facing-Both-Ways" have we had such an example of disastrous indecision.

The people of Canada might not be so much alarmed at this budget if the minister had not said that it was "essentially a peacetime budget, providing for the financial needs of the first post-war year which is wholly a year of peace", to which he added that certain demobilization costs would not be of a recurring nature. This, then, is to be the model of his government's production-incentive budgets for the future-may we hope it will be short.

I have asked for a reexamination of his government's policy on excessive expenditures, on exports, on private expenditures of a capital nature, particularly housing, and on consumer's expenditures and price control. I have pointed out the fallacy of the incentive-destroying personal income and corporation taxes, the restrictionist effects of their attempts at managed economy, and the unfair and antisocial distribution of the tax burden in the case of married women who wish to work.

The importance of "take-home pay" has been emphasized and certain alternative fiscal measures have been suggested. We are rapidly drifting, if we permit the trend to continue, into a managed economy where brain-trusters regulate the conditions under which we all strive for a living. It is a step toward socialism and state control and the eventual loss of economic liberty which inevitably leads to the loss of personal freedom for which we have just fought and won a great and costly war. Our duty is to give our people a budget which will ensure them their economic freedom as well as economic security and encourage them to put forth their best efforts in ordor that all may fully share in the great heritage which is Canada!

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IND

Herbert Wilfred Herridge

Independent C.C.F.

Mr. H. W. HERRIDGE (Kootenay West):

I just wish to make a few comments on the budget and to present to the house some of the opinions of my constituents toward it.

It was interesting to me to listen to the criticism of the Progressive Conservative party members, especially the first two or three speakers who asked for a policy of economy in this country. I am interested in it because, after hearing the criticism and other experiences I have had, I have found the reason why the Progressive Conservative party is called the Progressive Conservative party. When the members of that party sit in the veterans affairs committee they vote unanimously for every scheme that means the expenditure of money, and sometimes vote against the majority of the committee. When the Conservatives come into the house they criticize the government for the expenditure of money in general. Therefore, in the veterans affairs committee we find them very progressive and in the house typically Conservative.

This afternoon the hon. member for York West (Mr. Adamson) dealt with the question of bringing the Canadian dollar to parity with the United States dollar. He pleaded with the Minister of Finance (Mr. Usley) to work on behalf of having a free market for gold so that gold could be sold at a world price. When he was saying that I thought of the days of the depression in the United States when there was a free market for gold, when gold was selling at $22.62 an ounce. As a result of government action it had to be raised to $35 an ounce before conditions started to improve in the United States. Yet this afternoon that hon. gentleman was suggesting that the Minister of Finance work for a policy of that kind.

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PC

Agar Rodney Adamson

Progressive Conservative

Mr. ADAMSON:

There was no free market for gold in the United States. This is partly what caused the depression to take such a firm hold on the economy of the United States.

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IND

Herbert Wilfred Herridge

Independent C.C.F.

Mr. HERRIDGE:

We differ in that connection.

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PC

Arthur Leroy Smith

Progressive Conservative

Mr. SMITH (Calgary West):

That is not in the hon. member's book, is it?

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LIB

James Horace King (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Order.

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IND

Herbert Wilfred Herridge

Independent C.C.F.

Mr. HERRIDGE:

Before proceeding further with my few remarks on the budget, I wish to express the appreciation of the people I represent of the government's policy of price control. I believe they all support strongly the present policy of price controls. Many of them write me from day to day and week to week, as also do organizations, urging that I emphasize that price controls be maintained and strictly maintained. When it comes to the question of bringing the Canadian dollar to parity with the United States dollar there has been some criticism of that, and possibly,

The Budget-Mr. Herridge

as far as gold mining is concerned, it may cause a temporary setback. I am quite sure that, on the whole, it will be of benefit to the Canadian economy. I am quite ready to accept the decision of the Minister of Finance in that respect because of the way in which he and his associates handled the finances of this country during the war period.

I should like to mention the issuance of Canada bonds. In the riding I represent there has been a most sympathetic response to the issuance of these bonds. They are excellent and something that should become a permanent part of the government financial policy.

I have a few criticisms to make which are set out largely in the subamendment moved yesterday by the C.C.F. This subamendment reads:

That all the words in the amendment after "the calendar year 1946," be struck out, and the following substituted therefor:

(1) by raising sufficiently the exemptions of those in the lower income brackets.

In my constituency, particularly among the working people, there is considerable disappointment that the exemptions were not raised to a greater extent. I think it would have been a better policy to 'have raised the exemption for single persons to $1,000 and for married persons to $1,800, and at the same time place more emphasis upon the sale of Canada bonds. I am quite sure that if the exemptions had been raised and the situation placed before the people there would have been a most generous response-I assume there will be anyway-to the appeal to purchase bonds. The sub-amendment continues:

(3) that the budget fails in the new offer to the provinces to provide for social security measures which will achieve a reasonable standard of economic security for all Canadians.

I know there was great disappointment throughout Canada, particularly among old age pensioners, over the failure of the dominion-provincial conference. I think this government should have announced, as a definite policy to be brought into effect in the near future, some scheme for the alleviation of the condition of these people. There are many people in these older groups, particularly those between the ages of sixty-five and seventy years, who are not able to qualify for old age pension and who also are not able to find a place in the labour market. I submit that provision should have been made for them in the budget. The subamendment continues:

(4) that the budget fails in its tax proposals to recognize the principle that cooperatives are non-profit-making organizations.

I am glad the Minister of Finance and the government did not succumb to the wooings of the income tax payers' association, but I do not think they have recognized the cooperative movement to the extent that they should have. Labour and the cooperative movement are the twin bulwarks of any democratic country. I have had long experience in the cooperative movement and I feel keenly about this. I think the percentage of my constituents who are members of the cooperative movement is greater than the percentage in any other constituency. We have service cooperatives, consumer cooperatives and agricultural cooperatives. I realize that this is a rather strong statement to make, particularly when I am looking at the Minister of Agriculture (Mr. Gardiner).

I am speaking on behalf of the people in my district who support the cooperative movement and I urge this government to give that movement every encouragement possible. When the government went to the country at the last election they put out posters reading, "build for a new social order". If the government want to build that new social order they will have to get the cooperation of the people, and there is no group of people in this country doing more toward building a new social order than those who support the cooperative movement.

This evening the hon. member for Cape Breton South (Mr. Gillis) mentioned what had been done in his district in Nova Scotia, but I should like to give an illustration of what has been done in my constituency. In 1932 a few men who lived in Rossland, who were working for the Consolidated Mining and Smelting company, decided to form a cooperative to transport themselves from Rossland to Trail, a distance of about seven miles. At that time the charge made by a private company was ninety cents for the return trip. A half dozen men got together in 1932, formed a cooperative and purchased five or six seven-passenger cars. From then until the present time they worked steadily at the development of that cooperative until to-day it has 1,000 members whom it transports between those two cities for thirty-five cents the return trip. It has a fleet of fifty-seven passenger cars, a $50,000 garage, several clerks, and has subscribed for over $20,000 of victory bonds. Last year it was able to pay $10,000 in patronage dividends. I mention this as an illustration of what a group of people working together can do for themselves.

It is not only the financial advantage that counts; it is the effect that the cooperative endeavour has had upon the city of Rossland

The Budget-Mr. Herridge

itself. It has permeated its way into the community. These men working in that movement have seen what can be done and they have formed a consumers' cooperative movement. They are to be found on the city council and in every public activity in the city. As a result of their activities there have been formed other organizations on the same basis which have proved to be extraordnarily successful. On behalf of the service cooperatives, the consumer cooperatives and the fruit organizations of Kootenay West I urge the government to give further recognition to the functions of the cooperatives in this changing society. The subamendment continues:

(2) that the budget fails to provide for the investment of public funds to bridge the gap between anticipated private investment and the total national investment required to assure a high national income and full employment.

The government has failed in not providing for a full programme of investment. This investment should not be limited to any extent to the immediate future. This is the time to plan for the future; this is the time the pattern should be drawn. If this government in this budget had announced to the Canadian people that where private enterprise failed to give good employment at decent wages the government had a programme to put those people to work at decent wages, I think it would have been accepted by the people of Canada as a genuine effort at the beginning of a new social order.

When it comes to the question of public investment, that means public expenditure. In that respect I suppose we shall be criticized by our hon. friends of the Progressive Conservative party. I think I am correct, and if I am not I trust the hon. member for York West will correct me, when I say that we have had a balanced budget only on fifteen occasions since confederation. When it comes to a question of public investment, it is not a question of going into debt. This public investment will be an investment which justifies expenditure. It is entirely different from public expenditures for purely relief projects which do not get us anywhere.

I suggest that this budget would have had a tonic effect upon the Canadian people if some such proposal had been provided, if the government had shown the Canadian people that they were preparing for the future. I admit that with the labour situation, and possibly with the material situation at the present time, it would not be possible to expect any great expansion of public enterprise, but I think the pattern for the future should have been laid down in this budget.

I suggest that there are three or four forms of public investment to which this government should give serious consideration and to which I suggest this government will be giving serious consideration before long.

First, we should have a public investment programme for national housing. That is the first need of the Canadian people; to see our people properly housed and sheltered is our first duty. At the present time several housing projects are coordinated under the administration of one minister, but at the same time we are not tackling this problem in the way we should. We have discovered that in the veterans affairs committee. No one is personally responsible. We should have a large programme of subsidized housing to meet the needs of the Canadian people. That should be planned for in a programme of public investment which would be put into effect as the need develops.

In addition, I feel that there is a tremendous necessity for public investment in the development of irrigation schemes which are so sadly required by many of our good friends on the prairies and by many people in British Columbia, especially in the Okanagan valley, in northern British Columbia and in the Koote-nays. That is a programme of public investment which would bring dividends in the way of increased production." It would be a sound investment from every point of view. I believe that at the present time it would not be possible to go very far, but there, again, I suggest that in a programme of public investment this government should be planning great schemes of irrigation projects in western Canada; for the future, water means food.

There is another opportunity for public investment which would absorb the labour slack in the future. There is a great need for a programme of doing away with grade crossings. I understand that there are 30,000 level crossings in this country and that only slightly more than 3,000 are protected. There is a type of public investment which would pay dividends in the saving of life and time and which would build up and improve our facilities. I suggest that this is another form of public investment which should be considered by this government.

I now come to a programme which is of serious concern to the people of southern British Columbia and to the residents of my constituency. As part of a public investment programme trans-Canada highways should be developed. The Canadian people require for the immediate future a good highway system for the transportation of commodities and for the attraction of tourists from the south. During the past few days I have had a number

The Budget-Mr. Herridge

of letters from residents of my constituency pointing out that hundreds of United States tourists are actually visiting the Kootenays at the present time, and they all complain of the same thing, the poor condition of British Columbia roads, which prevents large numbers of tourists from coming. Here, again, I do not suggest that the time is ripe for the government to step in with a large programme of trans-Canada highway development, but the government should be laying plans for the future, for a system of trans-Canada highways that will be a credit to the country and reflect the wealth which this country can produce. I have here a brief which has been circulated generally throughout western Canada and in British Columbia. It was originally submitted to the dominion regional reconstruction council for Alberta by the Calgary board of trade. This brief deals in general with the possibilities of highway development in western Canada. I shall not read it in full because it is lengthy, but I shall read one or two of the reasons given why this organization believes in the necessity for the development of a dominion government trans-Canada highway programme:

1. To foster and encourage communication between the separate provinces of our dominion with a view to developing a national spirit.

2. To insure Canada to some extent against unemployment.

3. To attract American tourists and to capitalize on the favourable advertising we have received during the past six years.

4. To keep Canadian tourists at home by making motor travel in our own country as attractive as it is elsewhere.

5. To assist in the development of our natural resources, especially mining and forestry.

Then 6, and I am sure this will appeal to the hon. member for York West:

6. To provide a better and more adequate postal service in rural areas, and in communities not served by railways.

7. To improve the health of our nation by bringing hospital centres and medical services closer to our rural citizens through the use of motor transport.

8. To develop our educational system by providing roads over which buses may travel and bring the students to the centres where they will receive adequate and proper training.

9. To encourage farming by bringing the farmer closer to his market with the use of motor equipment.

10. To encourage immigration from the United States.

11. To assist the individual owner of a motor vehicle to operate same more economically.

12. To assist in creating a favourable balance of trade with the United States and thereby raise the standard of living in Canada.

In addition, the Nelson board of trade of my own constituency, supported by all the other boards of trade in the riding and

fMr. Herridge.]

branches of the legion, sent the following letter to the Prime Minister (Mr. Mackenzie King) early this spring:

To the Right Honourable W. L. Mackenzie King, Prime Minister,

Parliament Buildings,

Ottawa, Canada.

Sir:

It is requested on the following grounds that the federal government contribute to the improvement of the highway between Medicine Hat in Alberta and Hope in British Columbia and that it be recognized as the southern route of the Trans-Canada highway.

(a) It is open for travel 365 days in the year whereas owing to climatic conditions, the northern route known as the Big Bend highway is open for travel for not more than five months in the year.

(b) It serves the most thickly populated area in the interior of British Columbia, the number of residents of the area being at least ten times that of the district contiguous to the Big Bend highway.

(e) It traverses a territory considerably more developed industrially than that adjacent to the Big Bend highway in mining, smelting, power, lumbering and agricultural activities, including among others the principal operations of the Consolidated Mining and Smelting Company, of the power plants of the West Kootenay Power & Light Company Limited and the East Kootenay Power and Light Company Limited.

(d) The public works department of the government of British Columbia has under construction a 40-car capacity steel ferry with necessary landings and approaches to provide for the Kootenay lake crossing.

(e) It provides access to some of the outstanding scenic beauties of southern Alberta and British Columbia, including the Waterton, Kootenay, Slocan, Arrow and Okanagan lakes, which have great possibilities as tourist attractions which cannot be realized until the highway is made adequate for tourist travel.

(f) Throughout its length it is approximately

parallel to and within a relatively short distance of the United States boundary and has many connections with the United States highway system. .

(g) Its immediate improvement would relieve the unemployment which exists and will continue during the readjustment period.

That resolution is supported by all organizations and residents of my constituency. They are very much concerned about having the southern provincial route, a portion of the trans-Canada highway between Hope and the Alberta boundary, improved and extended. There is one rather unusual feature in connection with the suggestion for the development and extension of this southern provincial highway, and that is the suggestion to make arrangements to go through United States territory to avoid going over the Cascade mountains between Rossland and Grand Forks. Between Rossland and Grand Forks the road climbs to an elevation of 5,400 feet over the Rossland summit and the Cascade summit. The road involved an expenditure of large sums of money, but a satisfactory highway will

The Budget

Mr. Herridge

never be built, owing to the steep nature of the banks and the trouble every spring with thaws. It is a very difficult route to keep open in winter. At the present time it is not kept open because of the great expense and most people travel from the interior of British Columbia to the coast by United States roads.

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

An hon. MEMBER:

It misses Kamloops.

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

Herbert Wilfred Herridge

Independent C.C.F.

Mr. HERRIDGE:

Kamloops is on the central trans-provincial highway. It just so happens, Mr. Speaker, that those mountains taper out five or six miles in United States territory; and if we could get permission either to- purchase 300 feet of right of way in the United States between the American towns of Laurier and Patterson, or possibly get a section-the distance would be some 25 miles long by five miles deep-and have that made into an international memorial park, with special arrangements for immigration and customs, the matter could be dealt with in that way. In any event, the people of my district are very much concerned that the Canadian government shall make some arrangements with the government at Washington to enable us to get around the tapered end of the Cascade mountains through United States territory instead of, for all time, climbing over two mountain slopes unnecessarily.

In this connection I may say that I have travelled over the whole of the road with officials of the United States government and engineers of the department of public works of British Columbia. It is practically level country, its highest floor being some 200 feet below the city of Rossland, and the cost of construction would be very moderate.

In that connection a brief has been prepared by the Rossland junior board of trade. They have done a great deal of excellent work on this subject. I do not want to take the time of the house to read the brief, but the information contained in its couple of pages would, I believe, interest all hon. members; it has to do with a quite unusual proposal, and with the unanimous consent of the house I should like to place it on Hansard.

Topic:   THE BUDGET
Subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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July 9, 1946