Mr. J. H. BLACKMORE (Lethbridge):
Mr. Speaker, I have been deeply interested in the remarks of the hon. gentleman who has just taken his seat (Mr. Edwards). We have been sitting here quietly now for some time, listening to this discussion back and forth across the floor of the house, on high and low tariffs, and if there is one thing which it has abundantly proved to me it is this simple fact, that you cannot change the tariff either up or down in this country without hurting just about as many people as you help. I think it is tragic to have that brought so vividly to the attention of this group of 245 serious-minded Canadians who have come here to try to find a solution of the difficulties
which confront us, and to have that fact emphasized so many times.
One month ago I stood in my place in the house and said that I hoped that the promises which were either implied or definitely made either on the platform or through the press by the Liberal party during the campaign would be implemented in such a way that the credit of the dominion would be used for the benefit of the people. I visioned in that, Mr. Speaker, some sort of solution for the difficulties confronting us, but thus far I have seen nothing of the kind even hinted at in our proceedings up to date. We seem to have no thought of using our national credit to the advantage of this country. The fact that we take our tariffs so seriously has impressed me tremendously. When it is found that two men become exceedingly earnest over a question, so much so that each calls the other a liar and says that he is crazy and all that sort of thing, one can generally conclude that both are wrong and that the truth lies somewhere between them.
There are two parties here, made up of intelligent men; and may I, Mr. Speaker, express my appreciation of the type of men that we have in this parliament. I have great respect for them, on both sides; they are, on the whole, earnest, sincere men, anxious to do that which will help their country. To think that these men would be opposing each other with such vehemence over a matter like tariffs is to me a rather disagreeable thought. The truth lies somewhere between the two, or in some sort of adjustment.
This reminds me of a friend of mine who had periodically a serious attack of pains in the side of his face. Some of his friends knew something about doctoring, and they used to come in and say, "You must use this medicine, this ointment, this liniment; you must rub it in just right," all favouring external applications. He had some other friends who said, "No, take some herbs; take some internal remedies; take some drugs; they will cure you." And he tried first one set of remedies and then the other. Neither of them worked; and these men, evidently certain that a cure lay somewhere between the two, argued with each other and blamed each other for the patient's failure to recover. Each party listened to the other so much that gradually the men who believed in external applications began to think that maybe some medicine inside would help, and the men who believed in internal applications gradually came to believe that some liniment might
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be useful. Finally there came a time when the advice of one side was almost like the advice of the other.
We have reached this point in the Dominion of Canada at present. The two parties have modified their views until they almost exactly resemble one another. One advocates internal treatment and the other external treatment, neither being able to cure the patient. This man finally got into a distracted condition, just as Canada is getting into the same state, and he went to a chiropractor who, after giving him an examination, discovered that there was a dislocation in the cervical vertebra of this man's neck; he adjusted it, and the patient recovered.
I fancy that some sort of adjustment is needed in this our economic body in order that it may recover. I wonder what sort of adjustment is necessary. I believe the serious consideration of parliament should be directed to this question of adjustment. I have become convinced, whether other members of the house share these views or not, that a cure does not lie in either of these two treatments. I am very much in sympathy with the remark of the hon. gentleman who just sat down that if there is a truth regarding tariffs-and we will all grant there must be
that truth should be discovered by experts and not by partisans arguing with each other out on the hustings, through the press, each one a little less informed about the truth of the matter than the other and arriving nowhere.
In my own constituency I find some very striking illustrations of the truth of the opinion that tariffs counteract each other. There are a number of people in the constituency who produce fruit. If we cut down materially the duties on fruit and let it in free to Alberta, two-thirds or three-fourths of my constituents will be very happy, but the rest of my constituents *who raise fruit will be ruined. That is a serious matter.
Again, in my constituency there are two sugar factories. If we should raise the duty on sugar a little higher this would help tremendously the men engaged in the industry of beet raising, but if we did that we should hurt terribly all the people who have to buy sugar. I do not know where you could go, Mr. Speaker, to discover a better illustration of what tariffs do and do not do than in that one little constituency of mine. I think it is probably typical of the whole Dominion of Canada. And I am prepared to ask, in all seriousness and earnestness, and with a cooperative spirit: Do you suppose that there is in Canada any tariff
that- does not hurt pretty well as much as it helps?
The nature of our problem has been pretty well developed by speakers on both sides of the house. I think everybody recognizes clearly this simple fact, that our task is to restore internal purchasing power to the hands of the people. The question is, how to get it there. Will trade do this? It is true that if we protect a given industry, the people employed in it will undoubtedly have added purchasing power put into their hands through the development of that industry. But if we protect that industry we hurt another; we take purchasing power out of the hands of people over here and put it into the hands of people over there. And the question is: Is that going to do any good in the long run? All that it does is to set one section of Canada against another. Really I cannot see, looking back over the last twenty years, that it has done very much except that.
Then, does trade necessarily increase or decrease purchasing power? Let us, as intelligent men and women, ask ourselves that question seriously. If you will pardon another reference to my constituency, there are in it two little towns; one is Raymond, the town in which I live and which is deeply interested in sugar manufacturing. Thirty miles away is another town, Coalhurst, which is primarily interested in the development of the coal industry. Years ago, when many more men worked in the sugar industry than now, since machines have displaced men, and when many more men worked in the coal industry than now, for the same reason, there was some advantage in trading coal for sugar. But to-day, when machines have largely displaced men, and purchasing power is not going into the hands of men and women, it does exceedingly little good to trade Raymond sugar over to Coalhurst for Coalhurst coal, because most of the people of Raymond have not the purchasing power to buy the sugar they need, and what is the good of trading sugar for coal, when Raymond people could not buy the coal when it was shipped to them? Now, if there were a tariff barrier between the two communities, and governments were able to put a tax through tariffs on the passage of sugar and coal from one town to the other, you might say that there would be some advantage to the governments, because it would give them an excuse for imposing taxation. Also if there were a railroad between the two places and money could be made by operating it, you might say that some purchasing power -would result; but that is
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about all the advantage I can see that could accrue from that form of trade. I am open to be convinced on this matter, but it will take more than has appeared here in the last five or six days, because the arguments have been entirely aside from the real point at issue. If there is this tremendous advantage in tariffs, surely someone should have found it out during these many years, and we should have appointed, long ago, a tariff commission of experts to settle this matter once and for all and have taken it out of party politics.
The next question is, even granting that trade gives one increase of purchasing power: Is there any chance of materially increasing trade? When you remember that there are 1,250,000 people on relief in the Dominion of Canada, with hundreds of thousands of people out of work, your problem is going to be this, to find such lucrative avenues of trade as will give you sufficient purchasing power to take these people off relief and put them to work. You will then have to increase your trade to a most astonishing degree. I doubt seriously if you have any chance of increasing your trade anywhere near enough to accomplish that end.
In the first place, what caused this thing called economic nationalism? Why have the nations raised these tariff barriers? Why did they discontinue freer trade? We are all, or a great many of us, worshipping at the feet of trade, dreaming of the time when we can get back the Dunning budget and things like that which are going to be panaceas for us. WThy did we ever depart from these advantageous ways? We can get some sort of idea by reading this little excerpt from which I quoted the last time I addressed the house. It is in the Times trade and engineering supplement, under date of Saturday, December 17, 1932. I read it because it indicates why nations in the first place began to limit trade:
If each nation gave to its own people full internal purchasing power, i.e., ability to absorb its own production, none would have any objection to exporting 10, 20 or 50 per cent of that production, and receiving imports of a similar value; it is because each has insufficient purchasing power internally to absorb its own production that each is anxious to export and unwilling to import.
There is the difficulty. If lack of purchasing power caused the nations to put up tariff barriers, how will you, merely by lowering the tariff barriers, increase that internal purchasing power? It hardly looks reasonable, does it? Again there is this difficulty among the nations, that they all have a great need of self-sufficiency. Just here at this point I should like to read an excerpt from an editorial
appearing in the Ottawa Citizen. I am going to throw the blame entirely on these newspapers instead of taking any myself. I quote from the Ottawa Citizen of Tuesday, March 3, 1936, which is rather recent:
In 1929, Germany imported nearly forty per cent of the wheat it consumed. In 1934 the imports had been reduced to about ten per cent.
It is one of the planks in the Nazi platform to seek German "self-sufficiency."
Will the mere lowering of our tariffs cause Germany to change that policy? I continue reading the editorial:
Nor is the self-sufficiency policy in wheat confined to Germany. Italy, France and Great Britain have adopted policies along similar lines and are concentrating on "saving agriculture" and making their people self-supporting in the matter of food. Other nations are engaged to the same purpose, and that is the chief reason why Canadian wheat exports are not what they once were.
So those who are so free in laying the blame entirely on the right hon. leader of the opposition (Mr. Bennett) might do well to read very seriously that passage in a good Liberal newspaper. Has the need for self-sufficiency changed? I submit that it becomes greater all the time because of the close proximity of war.
The next point is that every nation needs a favourable trade balance. I was much impressed, sir, with the remarks made so earnestly by the right hon. leader of the opposition when he pointed out that one of the dangers arising out of this trade agreement would be that in the course of a few years we might build up against ourselves an unfavourable trade balance by buying from the United States more goods than we could sell to that country, thereby placing ourselves in a difficulty from which it would take us years and years to extricate ourselves. The right hon. gentleman knows exactly how serious that matter is, because he was placed right in that position. There are many nations on the face of the earth that have found themselves in that difficulty; one of the greatest of these is Japan. Japan discovered that she had a very large unfavourable trade balance. It is a rule of the present economic system that a nation must sell more goods than it buys. Honestly, Mr. Speaker, if you have fifty-four nations in the world, each one trying to sell more than it buys, have you a possible situation at all? I submit that you have a thoroughly impossible situation. This is what gives rise to intense international rivalry over trade and thereby to war, and under the present system it is utterly impossible to avoid that situation. Japan realized very clearly that she had to reduce that unfavour-
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able trade balance, and that is exactly the reason why Japan is encroaching so seriously upon our markets, underselling Great Britain right under her nose. I should like to quote some statements which appeared in the Ottawa Citizen of February 10, 1936-*
Topic: CANADA-UNITED STATES TRADE AGREEMENT PROPOSED APPROVAL SUBJECT TO LEGISLATION MAKING PROVISIONS EFFECTIVE