BACKSTAGE AT OTTAWA
A summary of the achievements of the second sitting of the seventeenth Parliament with a forecast of probable developments during the recess
A POLITICIAN WITH A NOTEBOOK
WHILE this is being written, M. P.’s are drawing their indemnity cheques, settling with their Ottawa landlords, preparing to go back to their farms and offices and various Main Streets. For something like four months they have been in session, putting in a thirty-hour week talking and legislating; and while their words have been more numerous than their deeds, it cannot be said that this session has been barren of achievement.
Politically, it was far from being either memorable or momentous, but legislatively it did much that made a difference. Parliament, to many, may be just a “talking shop,” scoffed at by young cynics and sophisticates; but a body which can vote millions of our money for expenditure, or withhold expenditure altogether, or take additional tens of millions from our pockets in taxes, or pass all scrts of laws that affect our lives and liberties, is obviously not negligible. There was nothing negligible, certainly, about many of the things that Parliament has done these past four months, and lest the public may be blurred about them or is forgetful, it may be well to set them down. Thus:
It gave authority to the Government to spend, roughly, about $350,000,000.
It increased the tariff on about $200,000,000 of imports. It increased taxation by about $78,000,000; advancing the income and sales tax rates and imposing new minor taxes.
It took vigorous steps to deal with the destitution caused by drought conditions in the West.
It gave the Government wide powers to prosecute a tariff war with any country; conferred on it authority to impose a surtax of 33 per cent against imports from any foreign nation; conferred authority also to fix values for duty purposes, and to withdraw preferential rates.
It passed legislation renewing Federal grants for technical education.
It gave the Government power to appoint a financial controller to co-ordinate spending departments.
It passed a bill defining what constitutes Canadian nationality.
It voted increases in the salaries of the Prime Minister, the Leader of the Opposition, all members of the Cabinet, and the Speakers of both Houses.
It probed into the financial and constitutional aspects of Beauhamois.
It investigated the handling and marketing of agricultural produce, and prairie finances and credit.
It authorized the Government to increase the directorate of the Canadian National Railways from fifteen to seventeen.
It obtained a promise from the Government to call a Dominion-Provincial conference to discuss Canada’s right to amend its own constitution.
It accepted Mr. Bennett’s new Tariff Board, which, in future, will help the Government to frame tariff changes.
It provided for the taking over by the Canadian Government of the Royal Mint.
It put about twenty-five new laws on the statute books.
It put about 3.000,000 words on Hansard.
It cost the country, in the neighborhood of $2,000,000.
The Tariff Changes
'T'HE major achievement of the session was, of course, the budget. But though it was drastic and far-reaching, it contained little of the unexpected. Everybody knew, or should have known, that Mr. Bennett would increase the tariff, that he would go on to the logical conclusion of his policy of “Canada First.” Mr. Bennett, indeed, would have gone much farther than he did go, had time and opportunity made such a thing possible. As it was, his tariff increases affected $200,000,000 worth of imports, in itself a major tariff operation. Added to the $200,000,000 of trade touched at last year’s special session, what it means is that more than half of our total annual imports have already been brought under the Prime Minister’s fiscal policies. And Mr. Bennett, the country can be sure, will go on. Timedid not permit him to examine the 3,000 briefs of manufacturers which deluged him before and during the session, but a recess and a new Tariff Board will make up for this, and next year will witness the last installment of Mr. Bennett’s attempt really to try out protection. For good or ill, he is committing
the country to the National Policy, with the tariff features of it underlined, and those who know him feel sure that he will go through to the end with his experiment.
Nor were mere increased duties the most significant part of the budget. Equally important, and perhaps more revealing of Mr. Bennett’s fiscal creed and aims, was the power which he took to make our tariff more elastic and flexible, to forge it into a more potent weapon to cope with external tariff aggression. Thus, almost unnoticed by the country, he secured power to impose a surtax of 33 per cent against the imports of any foreign nation; took power to fix values for duty purposes, including all transportation charges, sales cost, etc., from point of origin to boundary; took power to withdraw preferential rates from any British country. No Government in recent years has ever asked for, or received, such power. Whether Mr. Bennett will use this power, and how he will use it, remains to be seen;
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but it is obvious enough what it is that he has in mind.
Nor was there cause for surprise in the budget’s taxation proposals. Faced with the largest deficit since post-war days, and unable to make a heroic fight for economy cope with it, Mr. Bennett had to get money somewhere and somehow, and in doing so followed fairly orthodox lines. His increase of the sales tax leaves that tax still two per cent less than it was only a few years ago, while his income tax increases, drastic enough on fairly prosperous incomes, were hardly revolutionary, and left Canadians still a far cry from their British brothers in tax-paying adversity.
The Income Tax Changes
TN ALTERING the income tax scale, ■*however, Mr. Bennett made one mistake —a political one. He lowered the tax on his own income. Those who know the Prime Minister are perfectly aware that the last thing he had in his mind was to cheat the State of something of his income, but it is just possible that it will be difficult to make this view prevail at a joint meeting on the hustings in some back concession at the next general election. If Mr. Mackenzie King is not above taunting the Prime Minister on this score, what may be expected of back-benchers and the ordinary run of candidates, their henchmen and auxiliaries? As a matter of fact, while Mr. Bennett took full responsibility for the tax change, the whole proposal was worked out by department officials and its flaws overlooked by the entire cabinet. By the time this is in print it is more than likely that the tax will again be revised to take care of the political error.
From the national standpoint, however, a far more serious question is as to whether Mr. Bennett’s estimate of $78,000,000 from his new taxation will turn out to be correct. Increased income taxes have not and do not always bring increased income tax revenue, and no guarantee exists that each additional cent of sales tax will bring an amount equal to that brought by the one cent tax last year. Considering, therefore, that customs revenue shows a steady decline, and that excise income is similarly falling off, there is unfortunately more than a possibility that Mr. Bennett will be out in his estimate, and that next year, when he is bound to need more money for various services, including an almost certain heavier deficit by the Canadian National Railways, he will again find himself with a yawning gulf between income and outgo.
There are, of course, his minor taxes; but these, although they will pick up an additional few millions, can hardly make much of a difference. Mr. Bennett, in truth, is pretty much in the grip of fate, and while the measures he has taken may prove to be
some armor against it, a far mightier factor in what happens to him and to Canada will be the course of general world events.
Politically, the budget by common consent sinned little on the score of strategy. There was balm in Gilead for everybody: for the manufacturers, for the consumers, for the western wheat growers, for those who mine coal. Precisely what the aid given to wheat and coal will amount to, remains to be seen. A five-cents-a-bushel bonus on all wheat marketed may neither rescue the western farmer nor bankrupt the treasury, but if, as is now proposed, the grain handling companies are compelled to make a return showing the quantity of wheat handled for each individual, and the individual is thereupon mailed a Government cheque, the plan may have excellent results—politically. And so with the assistance to coal. Mr. Bennett’s proposal may not result in all our coal mines working overtime, may not compel people in Ontario to burn Maritime or Alberta fuel, but if it moves even a fraction of the 2,000,000 tons estimated by the Government, it will help economically, and certainly ought to help politically. Neva Scotia, in particular, is very sensitive on this point.
Attitude of the Liberals
/"CONTRARY to general expectations, the budget brought a minimum of attack. The criticism of the Opposition was little more than the normal functioning of that body. Mr. King has evidently made up his mind that Mr. Bennett’s fate and future are in the lap of the gods; that nothing he can say or do will add to or detract from what is in store for him; and that the wisest course is to await events, committing himself and his party as little as possible the while. His speech, great in its length and a combined marvel of physical endurance and verbal gymnastics, laid down no Liberal line of policy, and was far from being dogmatic in either declaration or attack.
Mr. King’s strongest challenge was on the ground of unemployment. Mr. Bennett, admittedly, has not ended it, and there is not much possibility of his ending it soon.
Ilis most disturbing problem, in view of his past, is as to what he will or can do this coming winter in the matter of unemployment relief. There is little, unfortunately, that he can do. It is easy to speak of another vote of twenty millions or so, following the precedent of last year, but the great difficulty there is that such votes involve equal grants by provinces and municipalities, and that some of the provinces and most of the municipalities are far from being in a prosperous position to put up their share. In the circumstances, the most probable thing is that Mr. Bennett will remain content to spend what is left of last year’s vote, leaving things after that
to a combination of whatever is good in his fiscal policies and the mercy of Providence.
The House was at its best when it came to deal w'ith the question of Western relief. Here, for once, “none was for a party, and all were for the State,” and Mr. King and his followers more than met the Government halfway in a desire to render aid. Not in years, and perhaps not since Confederation, had Parliament been faced with a domestic problem of such magnitude, and it is but fair to it to say that it faced it with a fine unity and generosity. Precisely how much relief measures will eventually cost, nobody is yet in a position to say, there being no exact knowledge as yet of the extent of the drought's effects, but there are those who place the figure as high as $100,000,000. The work, too, will entail a vast deal of organization, and is bound to give Mr. Bennett more than his share of worry during the coming months.
He will have troubles enough, in any event. From the west are coming the prairie premiers, asking for a wheat board; there are two by-elections to be fought; and there is the usual turbulence over senatorships. Refusing Messrs. Brownlee, Anderson and Bracken their Wheat Board may be difficult enough, but it won’t be half as difficult or delicate as selecting the right senatorial material in Alberta and Saskatchewan. The trouble, as so often happens in matters of this kind, is racial and sectarian. The vacancy in Alberta, due to the death of Senator Lessard, is naturally claimed by French-Canadians, but it is also claimed, unfortunately, by others. In Saskatchewan, on the other hand, the vacancy there, the right of no race in particular, is also claimed by French-Canadians. Mr. Bennett’s plight is that if he refuses to appoint a FrenchCanadian in Alberta, he will be compelled to appoint one in Saskatchewan; which would be equivalent to jumping out of the frying pan into the fire. It is one of those difficulties, petty in themselves, which cause more political sorrow than things which really matter, and give statesmen more sleepless nights.
A Querulous Parliament
"piNALLY, to trail Mr. Bennett’s recess
like a banshee is the Canadian National Railways. In prosperous days, when there was lots of freight and revenue, nobody gave a thought to what the road was doing. Parliament sanctioned its capital expenditures, the Government endorsed its notes, and nobody stopped to enquire about its growing commitments. It is different today. In a querulous mood, and suddenly gone all for economy. Parliament has become critical and the Government uneasy, and this year, for the first time since coming to Canada, Sir Henry Thornton faced a fairly hostile House of Commons committee. Sir Henry,
it must be said, emerged fairly successful from the skirmish, but the attacks upon the road are by no means at an end. Powerful influences in the House and out of it make no secret of their hostility, and there are those who believe that the Government itself, and Mr. Bennett in particular, are antagonistic.
This latter view is most probably wrong. Mr. Bennett undoubtedly believes that the Canadian National has been spending more money than its own or the country’s position warrants, and will be inclined to impose a restraining hand; but remembering the powerful public ownership element in his party, it is unthinkable that he should try to commit sabotage with the road. Economy with it, as with all other branches and adjuncts of Government, will be his aim.
Freed of his Ottawa Economic Conference, which everybody in the end disowned, Mr. Bennett will have time during the recess for these problems. He is contemplating, too, getting a Minister of Finance, and this, with a financial controller, will relieve him of a great deal of his burden. The appointment of a financial supervisor will, in itself, mean much for the country. An auditor-general exercises supervision after the money is gone. He locks the door, in other words, after the horse is stolen. A financial controller, on the other hand, will check expenditures before they are made; will co-ordinate and organize all the Government’s financial activities; will act, in short, as a financial adviser. He may well save the country much money.
It is just possible, too, that the recess will see some minor Cabinet changes. Mr. Ryckman, the Minister of National Revenue, who has been in indifferent health, may ask to be relieved of his duties; in which event he would most likely be succeeded by Mr. R. C. Matthews, of Toronto. There is just a possibility, also, that Colonel Murray MacLaren, Minister of Health and Pensions, will ask to be retired, and that there will be a shifting in the Cabinet representation from Quebec.
Where and how the two leaders will spend the recess, is not known. Mr. Bennett, admittedly tired, will probably seek a brief holiday. Despite his prodigious labors, he came through the session in good physical shape and with buoyancy and cheerfulness undiminished. He could be, and was, autocratic and dictatorial, could exhibit strongarmed methods as when, hearing that confidential information was leaking out of caucus, he abolished his party’s caucus altogether; but he revealed a softer side of his character when he personally intervened to help a humble employee of the Chateau Laurier who had been the victim of a somewhat stupid joke; and he could find time in the midst of all his duties to give a dinner to the church choir which had sung at his sister’s wedding.
Which reminds us of our Minister Plenipotentiary to Washington, Mr. W. D. Herridge. Returned from his honeymoon, Mr. Herridge has been to Washington and back again. Precisely what he did while there, nobody knows; though it is known that he did not tell Mr. Hoover that Canada was prepared to go ahead with the St. Lawrence Waterway. Canada, in fact, is not prepared. With all the good will in the world for the project, Mr. Bennett takes the ground that until our financial position improves, it is no part of wisdom to embark upon such an enterprise.
Speaking of plenipotentiaries, Mr. Marier, our Minister to Japan, has been in Ottawa, reported to Mr. Bennett, told him of our prospects for trade in the Orient. But like prospects for trade in other parts of the world, they are not easily influenced by quick artificial methods.
With the session over, Mr. King is going west. He will make a duty call upon his Prince Albert constituents, but he will also take occasion to examine the Liberal breastworks all along the line, and perhaps yield to the temptation of some active missionary work on the platform.