Our Hundred-to-One Handicap

One hundred United States trade agents are constantly ‘selling' the United States in Canada. One lone Canadian has to cover the whole of the U.S. Why?

C. LANGFORD-BAKER October 15 1927

Our Hundred-to-One Handicap

One hundred United States trade agents are constantly ‘selling' the United States in Canada. One lone Canadian has to cover the whole of the U.S. Why?

C. LANGFORD-BAKER October 15 1927

Our Hundred-to-One Handicap

One hundred United States trade agents are constantly ‘selling' the United States in Canada. One lone Canadian has to cover the whole of the U.S. Why?

C. LANGFORD-BAKER

A GOOD deal of discussion arises from time to time as to whether Canada is, or is not, a nation. Judging from the frequent patriotic outpourings of political orators of every hue and variety—and even a considerable number of Canadians who actually support themselves by honest toil agree with their sentiments— there can be no doubt whatever about it. Canada emphatically is a nation, they say, and most of them are content to leave it at that. The subject, having been thus smoothly and satisfactorily disposed of, there is, in their view apparently, nothing more to be said and nothing at all to be done.

Vet an impartial spectator might be forgiven if he failed to find abundant evidence of a sense of nationality. American capital has a rapidly growing interest in almost every branch of Canadian industry. American news fills the columns of Canadian newspapers. American magazines flood the country from Quebec to British Columbia; American films teach American sentiments to Canadian children and, in a hundred other different ways, the influence of American nationality is felt daily in the Dominion, while Canadian nationality is not. Nevertheless. the patriots, having duly proclaimed by word of mouth to all and sundry that Canada is a nation, fold up their tents like the Arabs and silently steal away. True, they occasionally linger long enough to inaugurate another ‘Made-in-Canada’ campaign, the while their wives and daughters proceed to New York to buy their fall clothes.

This statement of the facts, of course, is not new. It has been impressed upon Canadian consciousness at various times by a few men of vision in the Dominion almost from the time of Confederation. Neither does it involve the charge of anti-Americanism. These are busy day3—or should be—and a busy man has little time to be ‘anti’ anything. Moreover, if there is any Americanization of Canada, visible or invisible, Canadians have largely themselves to blame. No intelligent person will condemn any man for having sufficient enterprise to extend his trade, which, after all, is all that Americans are doing at the present time in Canada. It would surely be a more logical move if, instead of confining themselves to recriminations, Canadians were to endeavor to extend theirs in the United States. Yet, with the exception of a few individual instances, little is being done in this connection. Certainly no national movement has been begun and governments have been notable for their singular apathy regarding the question. Meantime, Canada is not getting the full benefit of her own trade, is but slowly and laboriously expanding her markets and even pays a toll to the United States on Canadian industry' by excessive shipments through American ports.

Where Canada Falls Down

IN' THE opinion of many Canadian business men, resident in the United States, one of the most important methods by which Canada's trade with the United States and her interests generally could be very materi-

ally advanced is the appointment of a sufficient number of qualified trade agents or commissioners.

At present, the Dominion has one trade commissioner below the border with head offices in New York. The United States Government, on the other hand, maintains in the neighborhood of one hundred consuls-general, consuls and other representatives in the Dominion. United States consular certificates must accompany all exports to the United States, the consular officials collecting a fee of $2.50 for viseing every such invoice. By means of such vise fees, not only has the United States consular service in Canada paid for itself for some years but there has also been a considerable surplus left over for forwarding to the treasury at Washington. In some years, in fact, the fees collected have been double the expenditure.

It is not, of course, only in Canada that the United States keeps such agents. The service is maintained throughout the world and the system of certifying export invoices in the country of origin and charging a fee therefore is universal. The surplus of fees collected over expenditure in some quarters goes to offset the cost of maintenance elsewhere. There is, at present, nothing to offset Canada’s expenditure on her trade commissioner service abroad.

Other countries—Japan, Norway, Mexico, Italy, Spain, Belgium and the Netherlands amongst them—also collect vise fees in Canada on export certificates.

If Canada were to appoint trade agents to the United States to-day and impose export fees on the same basis as exporters pay them in the Dominion, it is estimated that the resultant revenue would be in the neighborhood of at least $1,000,000. Were this put into effect, it would be necessary for the Canadian Government to enact legislation requiring that all invoices of goods of $100 or over exported from foreign countries to Canada—for obviously there could be no discrimination where the United States is concerned—be vised, and that fees be charged based on the schedule of United States fees in Canada. The next step would be to appoint such Canadian agents forthwith in the leading American industrial centres, and to make suitable arrangements for collection in other localities. These trade agents should be imbued with the necessary authority for the collection of the fees and they should be subject to the supervision and direction of the Canadian minister at Washington.

There can be little question that the American system in Canada gives United States merchants an immense advantage in their dealings with the Dcminicn.

Were Canada to put a similar system in force in he United States, obvicusly she wculd greatly

benefit thereby. Canadian exporters would then have the advantage of an enormous amount of commercial information which is not now available to them, and which would enable them to compete more successfully with the United States manufacturer. Such information cannot be secured by any other means. To this end, it should be made clear that the main business of Canadian trade representatives in the United States would be to promote trade, which is undoubtedly the main reason for the presence in Canada of so many agents of her neighbor.

Another strong argument in favor of such a system being installed is peculiarly pertinent at the present vime. It would be of enormous assistance to the customs authorities, particularly in checking smuggling and in regard to the operation of the anti-dumping clause. There are comparatively few Canadian customs officers at present in the United States, working against enormous odds. If they had the co-operation of a considerable number of trade agents, the latter possessing the records of all export invoices, they could do far more efficient work than is possible under existing circumstances. Then, not only would the system add at least $1,000,000 yearly to Canadian revenues, but it would also remove unfair competition and prevent under-valuation and the shipment of stolen goods.

Primarily, however, it would increase Canadian prestige and render material assistance in promoting the sale of Canadian goods. As Canadian exporters are well aware, the declaration to be made before an American consul or agent requires details as to the quantity and quality of the goods with a full description thereof, the market value, the cost of packing and all other costs, charges and expenses. In other words, full information is obtained as to what is being shipped from each particular district, together with the actual Canadian market value. Such information, which is surely valuable, Canadian industry could obtain from the United States by means of the system proposed. Then Canadian agents could report trade opportunities to the Dominion Government as American agents continually do to the Government of the United States. Continued on page 54

Continued from page 18

Reference lias been made above to the necessity of obtaining some official status for such trade representatives as Canada might decide to appoint, in addition to those that she has already appointed in various foreign countries. The reason for this is obvious. A trade commissioner may aid Canadian trade but he has no powers of certification.

Our Biggest Market

A NOTIIER point that should scarcely need emphasis is the fact that the United States is Canada’s nearest export market. On the basis of the latest figure available, Canada sells more goods to the United States than she sells to any other country except Great Britain and, if it is desirable to extend her export trade at all, then it is surely desirable to commence such extension in United States markets, as far as present tariff conditions will permit. In this connection, it is worthy of note that the general impression prevailing in Canada that the United States purchases only raw materials and that the United States tariff practically prohibits the import of manufactured articles is, to some extent, erroneous. True, the value of the latter imported from Canada showed a very considerable decrease in the year 1922, due to the imposition of the Fordney-McCumber tariff, but since that date it has been steadily mounting again. At the present time more than one-half United States imports from Canada are wholly or partly manufactured goods.

If further arguments in favor of the system outlined are necessary, there is the experience of other countries to merit consideration. Great Britain maintains a complete corps of trade representatives in the United States, including a ‘commercial counsellor’ to the embassy who attends to all trade matters. Consuls and vice-consuls, who deal largely with trade questions, are scattered all over the country from coast to coast. Argentina, Belgium, Bolivia, Brazil, Chile, France, Norway and the other countries of the world also have varying numbers of trade representatives collecting fees. The only country that does not charge export fees is Great Britain. The other dues range from $2.40 to $12, with some based on a percentage of the invoice value of the shipment. If Canada were to adopt the same system, the fees collected by Canadian agents in the United States would not only pay the cost of their maintenance and the upkeep of the Canadian minister at Washington but also provide a surplus for the Canadian treasury.

National Viewpoint Needed

SO MUCH for the advantages of the first proposal named. The subject is not by any means a new one; it has been discussed for several years. As far back as January of 1920, the Canadian Clubs of both Boston and Philadelphia passed resolutions urging the inauguration of such a trade service by the Dominion Government, and numerous business and trade organizations in Canada have since followed suit. Many recommendations on these lines have been made— but the outstanding fact remains that Canada is not collecting the fees. Meantime, of course, there have been certain arguments advanced against it, chief of which seems to be that it is doubtful whether such export fees, if charged by Canada, would not eventually be paid by Canadian consumers. Even if they were paid by Canadian consumers the result would only be that much more protection for the Canadian product. Actually, in practice, it has been found in the United States system that the percentage is about fifty each way; that some exporters charge the customers and others do not. The point, however, is surely not an important one in comparison to the question involved. When the possible gain in

trade is taken into consideration, the prevention of dumping and smuggling, the minimization of undervaluation and the firsthand knowledge of an enormous cash market, can the matter of who pays the comparatively small fee be regarded as of vital importance? It is a case where a national and not a sectional viewpoint is needed and where Canada as a whole stands to benefit.

The nearest that a measure of the kind outlined ever came to being effected was in 1921, when the principle of the adoption of the fee was embodied in the budget resolutions passed by the Meighen government in that year. Largely due to political uncertainty, however, which resulted in an ultimate change of government, the legislation was never made effective and was subsequently repealed by the King administration in the first Liberal budget of 1922.

The measure passed by the Meighen government was in the form of an amendment to the Customs Act, as follows:

(1) Section thirty-one of the said Customs Act is amended by adding at the end thereof the following words: ‘and unless in all cases of shipments from any country other than the United Kingdom British colonies and British possessions where the value for duty of the invoiced goods in terms of the standard dollar of Canada is one hundred dollars or over, such invoice bear thereon a certificate of a Canadian trade commissioner, British consul or other duly accredited officer, in the form or to the effect prescribed in that behalf by the Governor-in-Council, who may also prescribe the fee to be charged therefor.’

Since the rejection of this amendment in 1922, the matter apparently has been given little attention at Ottawa. In 1925, A. B. Hudson, then Liberal member for South Winnipeg, challenged both the Government and the Opposition to ‘start something’ but his plea fell on deaf ears. The question is: How long are the authorities at Ottawa going to remain deaf and how many years will it take the country to realize its own interests.

Wanted: A National Outlook

OUMMARIZING the situation as a whole, one is tempted to ask how many Canadians are thinking in terms of Canada and how many in terms of province, or city, or town? Is the exporter thinking of Canadian trade as a whole or of Canadian exports only? Is the importer genuinely concerned with the Dominion’s industrial health, or merely with the tax on what he imports? If this be the case, then there is little hope for Canada until men be born with a vision that extends from coast to coast.

Not even the most ‘hundred per cent.’ American would deny that his nation is a nation of flag wavers. He would be far more likely to smile—self-consciously or sheepishly—and admit it. Undoubtedly, it is a practice that has its disadvantages —although he rarely sees them—and occasionally proves either irritating or amusing to his neighbors and to other races the world over. It has, however, one advantage that Canadians have not been accustomed to ponder on. The same flag is waved, albeit violently, from one end of the country to the other. It inspires much the same sentiments in the New Yorker as it does in the San Franciscan—in other words, it helps them both to realize that they are in one and the same country and to think in terms of it.

The suggestion may be drastic, but if it could have the same effect in Canada it might not be a bad idea to indulge in a passionate outburst of waving of the Maple Leaf emblem for, say, the next five years. Thereafter it might be adjudged a misdemeanor, and five years later a crime!