Our Population Problem

A Reply to Mr. Drury

March 1 1929

Our Population Problem

A Reply to Mr. Drury

March 1 1929

Our Population Problem

A Reply to Mr. Drury

THE Editor, MacLean's Magazine: As constant readers of your valuable magazine we have been greatly interested in the four articles written by the ex-premier of Ontario—Mr. E. C. Drury.

While we do not agree with many of the conclusions reached by Mr. Drury, we have no doubt as to the sincerity of his endeavor.

The honest efforts of a patriotic Canadian can be easily recognized. A man who has thought long and earnestly in an attempt to solve the greatest problem of the Canadian People to-day—the problem of population.

We do not propose to weary our readers with any criticism or analysis of the theories advanced in the first two articles. Mr. Drury himself has precluded any action of this kind by discarding them as impractical and unworthy of serious consideration. We now come to his third article in which he puts forth a possible solution of our immigration problem. In this article he proposes to improve the lot of the downtrodden farmer and remove what he considers the intolerable burden he now bears. All this is to be accomplished by the simple expedient of removing customs duties on everything the farmer purchases, allowing him to buy in an open market in the same manner in which he is compelled to sell.

Mr. Drury states that many attempts have been made to alleviate the conditions of our agriculturists. Colleges and experimental farms have endeavored to inculcate a greater knowledge of the soil and its possibilities. More up-todate methods have been advocated. Intensive farming is being studied by some of our leading public men. Scientific research bureaus have been working continually to secure grains which will provide more resistance to rust, etc., grains which will mature earlier and lessen the danger of frost and hail. Better methods of combating the menace of noxious weeds are also receiving careful and scientific attention.

After dwelling at considerable length on this phase of the situation, Mr. Drury comes to the dismal conclusion that everything of this nature has failed and must continue to fail until the crack of doom. Nothing but the removal of the entire tariff can ever make Canadian farmers absolutely prosperous and happy. He goes on to suggest that, if this were done, the farmers from every corner of the earth’s habitable surface would be seized with envy at the lot of their Canadian brethren. They would flock to this country or attempt to flock here in dense hordes. Canada would then select only those who came up to the high standard required for future Canadians. The land would be peopled to capacity in the twinkling of an eye and we would all live long and happily ever after.

There is no doubt in Mr. Drury’s mind as to the efficacy of his solution for our problem of population. He does despair, however, of the Canadian people possessing the necessary vision to adopt the policy he advocates.

If we shared Mr. Drury’s outlook as to farming conditions in Canada, both present and future, we would be very discouraged. As Western people, we are certain that farming must be the basic industry of the Prairie Provinces for many, many years to come. We have carefully examined Mr. Drury’s panacea for all the ills of agriculture. We have subjected it to the acid test of honest analysis and we are forced to this conclusion—if his is the only economic salvation of our people, the future of Canada is very dark indeed.

Let us closely examine the facts in regard to the tariff burden on our Western farmers.

The Case of Jonathan Laird

r"PO DO this to the best advantage we shall take a concrete example. Let us introduce Jonathan Laird, a newcomer to Canada. He recently sold his quartersection in Iowa for $300 per acre. This sale provided him with considerable capital, a part of which he invested in a half-section of land on the Portage Plains at the rate of $35 per acre. The purchase of a full line of farm implements involved a further outlay. His still fresh sympathies guided him in the buying of the latter to the John Deere Plow Company.

We will now tabulate for your benefit the implements purchased by Mr. Laird, the prices he paid, their approximate dutiable valuation, the tariff rate on this price and the net amount of duty paid.

While retail prices are correct, we are quoting only the approximate dutiable value and net cost of the duty paid on the implements listed. Both the Customs Department and the importing implement companies manage to keep the exact amounts shrouded in mystery. We approached the implement companies and they absolutely refused to divulge this secret. Our enquiries met the same fate at the hands of the Customs Department and the Customs Brokers.

However, we were fortunate in obtaining this information confidentially from what we consider an absolutely reliable source. We are quoting both somewhat above the amounts given us. We want to be fair in the matter to Mr. Drury and would rather understate than overstate the facts. Should any implement company endeavor to refute these figures, we challenge them to publish the correct amounts of the list mentioned below.

Selling Dutiable Tariff Net Implements Price Value Rate Duty

8-ft. Binder ..... $ 275.00 $170.00 6% $10.20

6-ft. Mower ..... 110.00 55.00 7%% 4.13

12-ft. Hay Rake . 63.75 38.00 7'/-% 2.85

16 x 16 Disc Harrow .......... 76.50 45.00 714% 3.38

20 Dble. Disc Drill 243.25 150.00 714% H-25

1-3 Furrow Engine

Gang Plow ____ 155.00 100.00 10% 10.00

5 Section Drag Harrow .......... 32.75 20.00 10% 2.00

31/.. x 3 Wagon

(complete) ____ 166.00 105.00 10% 10.50

1 15 x 27 Tractor 1,145.00 nil nil nil

$2,267.25 $683.00 $54.31

The average life of the above implements is usually estimated at from eight to ten years, although with proper care they will last much longer. To give Mr. Drury, however, the benefit of the doubt and taking the lower estimate as correct, we find the burden of the tariff to Jonathan Laird on his $2,267.25 outfit of machinery is $6.79 annually!

But Mr. Drury will say: “How about the duty the farmer pays on food products, etc?” Now we are just coming to that, for Jonathan Laird has a splendid wife and three beautiful children. This brings the number up to five, so we feel that Mr. Drury will admit that we are again giving him the benefit of the doubt as to the size of the average family on Western farms. Mr. Laird during the year purchased the following supplies of groceries, etc., and having a natural predilection for American products, he bought only foods coming from that land, avoiding in this way any “non-dutiable articles” and also any that would come under the lower British or intermediate tariff rates. Again we tabulate Mr. Laird’s purchases. It is impossible to give the retail prices of these items, as, of course, the prices are variable, but we do give the amounts, the rate of duty and the net result.

500

25

25

100

100

100

200

100

A'mounts

lbs. sugar .....

lbs. coffee ....

lbs. lea ........

lbs. raisins lbs. currants . ..

lbs. rice .......

lbs. macaroni bbls. apples ... doz. oranges . .. doz. lemons doz. grapefruit bunch bananas

pineapples .....

lbs. evaporated

prunes ........

lbs. apricots . . lbs. peaches

lbs. salt .......

lbs. pears ......

Rate of Duty Duty Paid

$1.50

.03

.10

.03

.03

1.25

per cwt.

per cwt. per cwt. per bbl.

nil

.50

nil

.0666 per lb. .50 per cwt. 1.00 per cwt. .05 per cwt. .50 per cwt.

$7.50 .75

2.50 .75

.37 .62 !/2

4.50 nil nil nil .50 nil

.66 2/3 .50 1.00 .10 .50

$21.01 2/3

We now come to the tariff burden on the family supply of clothing. We find it very difficult, however, to arrive even at an approximate estimate in this connection. There is no duty on cloth in

the bolt entering Canada. Neither is there any on raw cotton brought in for manufacturing or finishing. Therefore, the amount of duty paid by the average farmer on his clothing budget is very small. In spite of this fact, we are allowing $15 for this purpose. This is more than double the amount of duty Jonathan Laird paid on his machinery and two-thirds the amount paid on his food supplies. Under the circumstances, we are confident that Mr. Drury will acknowledge that we are at least fair in

this matter.

We now have a fairly accurate conception of the total burden imposed on Mr. Laird annually:

$ 6.79 for machinery 21 .01 for food 15 00 for clothing

Total $42.80

We might point out that of this amount only $6.79, the machinery duty, is peculiar to the farmer alone, the rest is collected from every householder in Canada who buys as Mr. Laird bought.

Conditions not so Dismal as Painted

NOW, does Mr. Drury honestly believe that, were the entire duty on agricultural implements to be removed, the farmers would reap the benefit? Certainly, the history of the past does not justify this assumption. We have a well established conviction that the four great implement companies—two Canadian and two American which practically control these commodities in Canada—see eye to eye in the matter of prices. Were the little duty now imposed to be removed, we feel certain the American establishments would thank the Government and pocket the profit. The Canadian Government would not benefit, the farmer would not benefit, but the manufacturers from across the line would declare a larger dividend. We believe it can be honestly said that during the past eighteen years any reduction in duty on farm implements has been followed by an increase in price. We ask every farmer who reads this article to look as far back as 1910 and ask himself if we are not correct.

It is assumed that Jonathan Laird bears an annual tariff burden of $42.80. We believe Mr. Drury will admit that this amount is far above the average contributed by the farmers of Canada who do not buy so heavily as Mr. Laird.

This sum represents at least his main contribution toward the upkeep of federal government. In return he gets a paid representative to Ottawa, governmental interest and assistance in selling his commodities and extending his markets; protection for life and property; experimental farms and research bureaus conducted in his interests; federal grants to highways; old age pension, etc., to mention only a few of the compensations Mr. Laird receives. It is also the method by which he shares the burden of the Great War; the maintaining of helpless and incapacitated returned men and the dependents of those who made the supreme sacrifice.

The cost of Government has to be met in any event, either through the tariff or by direct taxation. As to which method is the most economical is always open to debate. There is little doubt, however, that the former will always prove the more palatable.

During 1928 Mr. Laird worked his tractor all summer using a total of 3,000 gallons of gasoline. He paid the Provincial Government of Manitoba a tax of $90 on this item alone—a sum twice as large as his whole tariff burden. He paid a Municipal tax of $90. This included school taxes. Therefore, his share of the cost of Provincial and Municipal Government was at least four times the cost of Federal Government.

Mr. Drury depreciates the importance of efforts for better and more intensive farming methods, yet an increase of two bushels per acre on the 200 acres of wheat harvested by Jonathan Laird would have paid his entire tariff burden for the next eight years.

The new combine and swather which is now being perfected, is expected to reduce the cost of harvesting Western crops by at least $2 per acre. This method alone would save more to Jonathan Laird annually than the duty he pays in a decade.

A practical method of combating sow thistle alone would mean more to thousands of farmers in Western Canada in one year than the tariff cost of twenty.

Mr. Drury does not attach much importance to our experimental farms and research commissions. Yet the loss by rust,’ we understand, is now within measurable distance of being curbed through intensive research and tedious experiments. The producing of grain which matures earlier, thereby lessening the loss by frost and extending the wheat belt much farther North, has already been accomplished.

These things mean so much more to Western farmers than the imaginary tariff burden that in comparison the latter becomes a joke. In fact, the tariff bogey has become very old, feeble and anaemic. It can never survive the chill of public enlightenment. Most of those political gentlemen whom it served so long and faithfully, have now deserted it. We strongly advise that it be carefully embalmed and gently laid to rest while there may still be the necessary number of old admirers to give it a respectable funeral.

We have had years of experience dealing with the farmers of Canada, both in the East and West, and have found them a fair-minded, intelligent and independent class. They are always willing to pay their way. When they realize the picayune nature of the duty on their imports and that it is the most satisfactory method of contributing their share of the cost of Federal Government, they deeply resent the manner in which they have been misled. They are as ready to shoulder their responsibilities in this respect as they are in everything else.

They are, also, shrewd and far-seeing enough to realize the necessity of building up the home market and encouraging manufacturing for that purpose. They do become restive, however, when as often happens, and not without reason, they are convinced that some home manufacturers are not using the protection fairly, but in order to profiteer at the expense of the consumer.

There is another phase of Mr. Drury’s article which in the best interest of Canada should not go unchallenged. We refer to his dismal picture of Canadian agricultural conditions.

We see no evidence of this “slough of despond” west of the Great Lakes at any rate. Of course, some isolated districts have been hit by hail or frost or too much rain, but, generally speaking, the crop has been very profitable and the people on the whole are prosperous and happy. When the 221,000 farmers of Western Canada produce 500,000,000 bushels of wheat, 288,940,000 bushels of oats, 112,163,000 bushels of barley, 3,396,000 bushels of flax, 13,000,000 bushels of rye—to say nothing of stock, meats, dairy and poultry products, how can conditions in the Prairie Provinces be anything but healthy? We believe if Mr. Drury will take the trouble to enquire of the three Western Premiers, they will corroborate our statements in this regard.

In respect to the farmers of Canada selling their commodities upon an open market, we do not think any farmers in the world are better equipped to do so. It is not the Canadian farmer, but his competitors who have cause to worry over this fact. The Canadian farmer possesses very cheap land, the soil of which is second to none in fertility. They are an exceedingly shrewd, virile class of men and women. They have secured excellent railway and elevator facilities for handling their crops and market most of their grain through their wheat and grain pools. Last but not least, they can produce a class of wheat superior to any grown in North America, if not the whole world.

How can a farmer growing wheat in Iowa or Illinois on land worth $300 per acre hope to compete with a farmer in Manitoba or Saskatchewan growing a better grade of the same grain on land worth $35 per acre, when both must sell on the open market?

This article, from the pen of a man so prominent as Mr. Drury, is capable of doing considerable harm to this country in the eyes of the outside world. We think e\rery honest measure should be taken to counteract the disturbing and discouraging effect of his published outlook.

The Home Market Problem

TN REGARD to Mr. Drury’s fourth

article, we find it very hard to offer any criticism. We are so much in sympathy with the general idea and our imagination has been fired by the wonderful picture of Canada’s future which he unrolls before us. But after all, perhaps, it will not make our future less certain and will greatly lessen the risk of disappointments if we again look the facts squarely in the face. We must not prepare to meet conditions as we would like them to be, but rather as they really are.

It is true, as Mr. Drury states, that Canada possesses an unparalleled supply of water power. It is equally true that she possesses an abundance of natural resources which have lain dormant since the beginning of time. It only needs the harnessing of the first and the tapping o the second to make Canada the great hive of industry which Mr. Drury so beautifully envisions.

But here again we fail to see eye to eye with Ontario’s ex-Premier. He points out that Canada faces both oceans, the Atlantic and the Pacific, but he fails to point out that the abnormally long and costly rail haul from one side to the other makes the transportation of manufactured goods and raw materials in this way absolutely prohibitive. He speaks of the great transportation value of our vast inland seas, but seems to forget that for five months of the year these are locked with ice. What would Mr. Drury suggest that these manufacturing establishments do during this period?

He suggests, that geographically, Canada is more favorably situated as a manufacturing centre than any country excepting Great Britain. Geographic superiority, however, does not seem to count so heavily in the great race, as Great Britain has certainly lost ground to both Germany and the United States.

We have searched diligently, but have failed to find any country becoming a great manufacturing nation without a large home market to supply. This advantage Canada entirely lacks. It is not hard to see the difficulty to be faced in building up great manufacturing industries on the strength of foreign markets alone. She would have to sell in competition with highly industrialized countries, pit her unknown goods against the well-established commodities of her rivals. All this after she had paid the costs of transportation and the high import duties which these countries would undoubtedly impose on her competitive offerings. To offset these obvious disadvantages, we must grudgingly admit that, generally speaking, Canada needs more than cheap power and natural resources.

Perhaps the most amusing part of Mr. Drury’s article is where he naively suggests that Great Britain would look with-*approval and might even be induced to give financial assistance to a scheme which has for its object the removing of her main industrial enterprises, as he so aptly expresses it, “lock, stock and barrel.”

If Mr. Drury’s fourth solution must be dismissed on account of its impractical nature, we Canadians have the consolation of knowing that our natural resources lose nothing of their ultimate value by our failure to develop them hastily. As these resources of our neighbors become depleted, the relative value of our own must become greatly enhanced.

There may well be wisdom in following the advice of Premier Stanley Baldwin upon his last visit to this country when he said to the Canadian people: “You have a wonderful heritage, be patient and careful in its development. You have no cause to hurry. There are thousands of years ahead.”

As we see it, outside of their utter impracticability, both solutions offered by Mr. Drury were doomed to failure as all other solutions are doomed to failure which are based upon the continued hostility of Canada’s two premier industries—agriculture and manufacturing. These industries are absolutely interdependent and therefore the only policy which can ever hope to succeed is one which replaces friction with harmony and has co-operation for its keynote.

W. S. Newman,

H. E. McLuhan,

Winnipeg, Manitoba.