Mr. Cashin Mr. Chairman, before we proceed
this afternoon there are a few remarks I want to
make. One is that about 12 months ago Mr. K. M.
Brown, a delegate to this Convention, was stricken here in the discharge of his duty.
Yesterday I
received the following message from Mr. Brown,
which I propose to read:
Mr. P.J. Cashin, St.John's.
I eagerly awaited your report and sat up
until midnight and listened to every word. It
was one of the finest ever delivered in that
famous chamber. Congratulations. We must
have responsible government and all the
freedom that goes with it. You are fighting
hard, keep it up. Warmest regards. KM.
Brown.
To which I sent the following reply:
On behalf of the Finance Committee and
myself wish to thank you for your kind
remarks regarding Economic Report. I am
sure that you will continue the fight for
freedom until victory won. All delegates
hope for early recovery your health and that
you will be with us once again. Regards. P.J.
Cashin.
Mr. Hollett Mr. Chairman, I rise to make a few
remarks with regard to this long awaited Report
of the Finance Committee on the economic side.
First and foremost I would like at this moment to
offer to that Committee and to its chairman,
Major Cashin, my heartiest congratulations for
the manner in which this report has been
presented to us, and I feel that we owe them a debt
of gratitude for the promptness with which they
brought this report before us at such short notice.
I am quite sure that we all agree, as we read
through this, that these men have done an excellent job.... Each and every one of
these men who
has signed this report is in my opinion definitely
an honest man.
Mr. Chairman Let there be no question about
that, Mr. Hollett.
Mr. Hollett Referring to a remark which was
made in yesterday's session, it was definitely said
here that this report was not an honest report.
What am I to infer from that statement? Can I
infer any other than this, that the men who signed
that report are not honest? If they are not honest,
then they are dishonest. I cannot agree with the
remark which was made by a certain speaker in
yesterday's session. Now I would like to ask
Major Cashin one or two questions before I
proceed.
On page 1, Major Cashin, you referred to the
Financial Report, and you say that the total
revenue from 1897 to Sept. 30, 1947 amounted
to, in round figures, $496 million, whilst the
expenditures come to approximately $500 million. I would like to ask you, were these
figures
properly audited, properly copied from the
records, or were they guesswork?
Mr. Cashin They were properly copied from the
records — Auditor Generals' reports and the
budgets.
Mr. Hollett Thank you. If you will turn over to
page 2, with regard to the reduction in the debt, I
see you have the net debt as $35 million. How did
you arrive at that?
Mr. Cashin Our gross debt, after deduction of
sinking fund, etc., is approximately $70 million
in round figures. We have $35 million in cash,
$9.25 million of which is on loan to Great Britain
free of interest, and the balance to the credit of
the country here in Newfoundland, and some
small amounts to the credit of Newfoundland
with the Crown Agents in London, in all $35
million, and if we deduct that $35 million it
leaves us a net debt of $35 million.
Mr. Cashin Yes, there's $6-7 million in dollar
debt.
Mr. Hollett Let us turn to page 3, a matter
relative to insurance and savings. You will see
there at the bottom of Page 2, "Therefore today
we can definitely state that Newfoundland's capital account shows a surplus in cash
of $35 million; and in addition the people of the country
652
NATIONAL CONVENTION
November 1947
have on deposit in the various savings
banks not
less than $80 million..."
Mr. Hollett "Also our people carry life insurance with a cash value of at least $30
million..."
Mr. Cashin Those figures regarding the
total
amount of insurance which was carried were also
obtained from an official source...
Mr. Hollett Turn to page 7, in regard to
the
matter of conversion. "When a delegation from
this Convention met representatives of the
British government in London several months
ago, we were advised by the Dominions Office
that, beginning January 1, 1948, the conversion
of our 3% guaranteed stock, which amounts to
£17,790,000, or in dollar currency approximately
$72 million, which is at present bearing interest
at 3%, would be made, and that new stock would
be issued bearing interest at 2 1/2%." I know that
is correct. Did your Committee make any inquiries as to why that conversion will not
be
carried out?
Mr. Cashin Mr. Hollett will know that
when
Lord Addison made that statement he said that
three months' notice had to be given, that is on
October 1, but three or four days prior to that date
an announcement was made here by the government that conditions would not permit this
sterling debt to be converted at this time. In looking
up the financial papers since that time, the London papers, and looking up the prices
paid for
bonds, I find that the Newfoundland 3% stock
was selling on the London Stock Exchange at that
time at 102 point something.
Mr. Hollett Did your Committee endeavour
to
find out why conditions would not permit?
Mr. Cashin No, we did not, I will be
quite frank
about that. It was done and that's all there is to it.
We hold that it should have been done, and we
feel it could have been done, but the point is this
—I know why it was not done...
It was because
it would mean an extra $500,000 saving to the
country, and it would mean an extra $500,000
that Great Britain would not get, and which she
is now anxious to get in dollar exchange.
That's
my personal opinion.
Mr. Hollett You did not enquire from any
official source?
Mr. Hollett Will you turn to page 10? You
say
there: "For purposes therefore of explanation we
give herewith proposed expenditures under the
various departmental headings..."
Could you tell
me on what you based these figures?
Mr. Cashin I can, Mr. Hollett. We have first of
all Consolidated Fund service, that means the
servicing of our public debt. That means today
the totals are $3,374,000, but the conversion on
that sterling debt, and by the application of the
interest-free loans we have given Great Britain,
and by the application of the sinking fund, and,
as I said the conversion of the balance of our
sterling debt to 2 1/2%, we would save approximately $1 million. Now if we take $1
million off $3,374,000, which is the Consolidated
Fund service, we find that it would amount to
$2,374,000, but for the purposes of more accuracy, and to create more discussion,
I made it
a round figure of $2.5 million...
Mr. Cashin I will explain them as you go
along,
Mr. Hollett. With regard to Finance, if you take
the estimate of expenditure for the present fiscal
year, 1947 - 48, there is an amount of $2 million
voted for the Railway, and there is a remark
which says: "Provision is made there for a
general subsidy of $100,000, which is included
in the $1.2 million." That subsidy is paid annually
anyhow, therefore the deficit is $2 million. Now
the General Manager of the Railway stated that
once those capital expenditures were finished,
the deficit on the Railway would not be more than
$750,000; and so we deducted this $750,000
from the $2 million, and it leaves us $1.25 million
paid in this respect.
Mr. Cashin They are all present estimates
except with the Education Department when
there is an increased vote under this proposed
plan of $650,000 a year, which would be used no
doubt for giving school teachers more money, or
in a general way.
Mr. Hollett I have elicited from the
chairman of
the Committee with regard to these figures of
$500 million and $496 million, that these are
definite facts taken from the Financial Report
which was presented and passed...
An insinuation was made here yesterday that these figures
were poppycock, pure nonsense, tomfoolery.
This is not the first time that the figures of the
November 1947 NATIONAL CONVENTION 653
Finance Committee have been disputed, but I am
glad to say that they have so far been disputed
without any success....
In dealing with the period from 1920 to 1934,
much ado about nothing was also made in the
remarks of the member from Bonavista Centre.
A long array of finance ministers was presented
to us, and it was intimated that scarcely one of
them ever made a correct budget. That, of course,
we can all understand. I fail to see how any
finance minister in any government, business, or
household, can make a sure estimate of what the
expenditures or deficits or surpluses will be from
year to year. But the point I want to raise is this:
much capital was meant to be dispersed to the
other needs of this country, and many finance
ministers not only failed to make an accurate
estimate of the surplus or the deficit, but they
made such errors and such estimates which in the
end proved to be very wrong. In touching upon
that point I would like for you to remember that
period from 1920 to 1934, remember that the
Great War had been fought and won. You will
remember that for two or three years after peace
was signed this little country enjoyed unwonted
prosperity. Fish was selling in the markets of the
world at higher prices than ever before, and consequently the people up to 1921 or
1922 were
enjoying such prosperity as had been undreamed
of before these days. Also you will remember that
shortly after that time conditions were not so
good. There were ups and downs and ins and outs,
if you like. And that's the way it was, I suppose,
with the finance ministers. But they were not
getting the price for the fish, and unfortunately,
at this time, they were not even getting the fish;
but they certainly were not getting the price they
had got some years before. Our merchants had
been stocked up to the hilt. Our banking owners
(I come from the southwest coast where they go
to fish in deep waters) had up-to-date vessels;
firms had from five to six bankers costing
anywhere from $10-25,000 and more, new vessels too. They had been perhaps unwise in
this era
of prosperity to think that it was going to continue, and they had gotten rid of the
old vessels
and gotten themselves new up-to-date vessels,
built in Lunenburg, Shelburne and other places,
at very high cost. That was the situation, and
suddenly the price dropped and the bottom
dropped out of the market, and the merchants
who were overstocked, the fishing plants or vessels, or shore plants on Labrador,
found themselves with good expensive gear and they could not
sell their fish. Under these circumstances I ask
you who could you put in as finance minister to
budget the surpluses or deficits from 1922 or 23
onwards?
I come down to 1931, but first I must remind
you of that great depression which struck the
world, not only Newfoundland, in 1929.
Everybody was broke, and by 1931 it was coming
in with a surge on this country, an absolute tidal
wave, and my friend Major Cashin at that time
was finance minister. Yesterday it was intimated
that because he made the colossal mistake of
budgeting for a small deficit and succeeded in
getting a deficit of $4 million, then this, what we
have here, was only tomfoolery. That was the
idea which it was the endeavour of the member
from Bonavista Centre to convey to you, and to
the country at large. I am quite sure you see now
how ridiculous that idea was. If my friend from
Bonavista Centre had explained to you that at that
time no finance minister in this world could
definitely make a correct budget, then I would
have no complaint whatsoever with the member
from Bonavista Centre.
New 1931 was a bad year. In order to prove
how uncertain things then were and in order to
prove how difficult it might have been for my
friend from Bonavista Centre, if he had been
finance minister, to make the correct estimate, I
would like to quote from a sort of history, an
economic history if you like, of this country,
written by my friend from Bonavista Centre in
the year 1930.
[1] 1931 was well in sight. If any of
you have that book I would ask you to turn to page
9. This is how my friend from Bonavista Centre
saw things in Newfoundland in the future:
The Newfoundland note then is distinctly one
of hope. The country has put its worst behind
it. The future is most promising. This march
to industrialism is no flash in the pan. Newfoundland is around the corner. Much
remains to be done to make conditions ideal
it is true, but the encouraging fact is that
much of it is being done to...
Mr. Chairman I must ask you are you speaking
on the Economic Report, or are you rather divert
654 NATIONAL CONVENTION November 1947
ing your remarks to prognostications made by the
member from Bonavista Centre in 1931, and if so
what relevancy is there between your remarks
and the matter in hand?
Mr. Hollett I am trying to prove that this report
is a good report, and the remarks made relative
to 1931 yesterday have no bearing whatsoever;
and I am trying also to prove that my friend from
Bonavista Centre forgot these things which he
wrote in an economic history, which I thought I
ought to read.
Mr. Chairman My only point is this: that if the
soundness or unsoundness of the report is to be
determined in the light of the soundness or unsoundness of the opinion expressed by
the member from Bonavista Centre yesterday, then of
course I can see a visible connection between the
two, but if the report is to appear on its own merits
then the opinion expressed yesterday can only be
regarded as his own opinion... 1 can't see that
there is any connection between statements made
by him in 1931 and the opinions held by him now,
which could alter our opinion when we are called
upon to decide upon the merits of the Economic
Report.
Mr. Hollett Mr. Chairman, may I refer to you
the fact that the member from Bonavista Centre
yesterday read to us two letters from Bonavista
Bay or other places? On that basis, may I ask you
to allow me to finish this short paragraph?
Mr. Chairman With consistency with the
latitude I allowed Mr. Smallwood yesterday this
allows rue no alternative. Under these circumstances will you go ahead.
And after all when all is said, where is there
another country in which life is so comparatively
tively free and easy? Where men can live so
easily in health and happiness as in Newfoundland? One has only to witness the bread
lines in front of hospitals and various
charitable institutions, and see the vast
crowds of hungry and unemployed men in
New York and other American and Canadian
cities, and read of the same terrible conditions in every country in Europe to appreciate
just how well off we really are in Newfoundland. Those of us who are interested in
the great changes that are coming over Newfoundland, and have had some contact with
the industrial life of the United States and
Canada, have one fervent hope, and that is
that with the coming of modern industrialism
to Newfoundland we may never lose the
fresh bloom of that wholesome life which
constitutes much ofthe charm of our country.
I just draw that to your attention to show how
difficult it was for the finance minister to make
up a correct budget in 1931. I also draw your
attention to the fact that there were bread lines in
New York and in many cities in the United States
and Canada in 1931. My mind goes back to 1934,
and I remember this: there were 90,000 people on
the dole here, and the government spent $1.5
million, and I do know our people were in dire
distress even in 1931. This book was not published for use in Newfoundland, but for
Newfoundlanders in Canada and the United States. I
will refer later to another document which was
prepared for export information and not for Newfoundland.
Now the Committee, on page 2, continues to
try and assess the value of the fixed assets of this
country, those things which are practically impossible to remove, not like money in
the bank.
And they found out that we have a Railway which
was valued at $72 million; some highroads here
which they further valued at $20 million; some
public buildings, lighthouses, public wharves,
breakwaters, etc, valued at $10 million. And
there was another $10 million for breakwaters
and telegraphs, making a total in all of $112
million fixed assets. Now fixed assets is something which you have which remains.
Sometimes
you have to get repairs, but anything you have
spent to get them, such as money which made up
our national debt, you have these fixed assets to
go against it. We have $112 million worth of
fixed assets, but there is a point I want to make in
connection with the Railway. In yesterday's discussion the chairman of the Finance
Committee
was more or less ridiculed because he had valued
the Railway at $72 million; we found that he had
got that figure from the report of the Ottawa
delegation, a figure which the delegation had
presented to the Canadian government to show
them how valuable we were. You will remember
the remark which was made by the member from
Bonavista Centre: "Of course we valued it at $72
million. We were fooling them, but we don't
want to fool you people at all."
Mr. Smallwood Point of order. I did not say that
November 1947 NATIONAL CONVENTION 655
we had valued the Railway, 1 said the management of the Railway had valued it.
Mr. Hollett I do remember that the idea of the
value of the railway being $72 million was pooh-
poohed in your oWn snappy way, Cashin.
Mr. Smallwood Point of order. Is the member
from Grand Falls permitted to refer to a member
of this Convention by his surname without the
courtesy of the added title of Mister or his
military title? Is he allowed to say just "Smallwood" or "Cashin"?
Mr. Chairman No.... I don't think it is proper
for any member to refer to another by his surname.
I think he should prefix it by "sir", or his
title or whatever it may be.
Mr. Cashin I have been called so many things I
do not mind.
Mr. Hollett It was you, Major, I referred to. I am
glad I did not refer to the member from Bonavista
Centre in such disrespectful terms. At any rate it
was definitely the opinion that it was all right to
tell a Canadian that we had a Railway worth $72
million, but you fellows know better than that.
We would not try to fool you fellows, not at all!
Are all the facts in that Black Book compiled in
that spirit, and if so, are the answers given by the
Canadian people in the same spirit?
Getting back to the various assets... The Committee refers to the Savings Bank, and
says there
is $80 million belonging to the people there, and
$100 million worth of life insurance, whose
cash surrender value is $30 million. How much
is that? $110 million. That in itself gives us some
idea of the economy of our people. The mere fact
that our people have $80 million in the Savings
Bank and $30 million in life insurance would
justify the Finance Committee coming to the
decision which they did in their report...
The Committee then takes a look at the Railway, ships and docks, and they advocate
that the
ships that are now in the mercantile marine class
should be put over in some sort of a Crown
agency, and they make it out in such a way that
they can save $1.25 million thereby, and in other
ways. Then they go on to the servicing of the
national debt. Major Cashin explained if interest-free loans and sinking fund were
applied to
our debt, reducing itto $54 million, we could save
$1 million in interest on the service of that debt.
Gander airport they also discussed and very
fully. They say they can save $750,000. That is
the only point upon which I must agree with my
friend from Bonavista Centre, that I can't agree
on the information which we received when we
were in London. I believe, and it was intimated,
that if the deficit was $750,000 we would have to
pay $250,000 and Great Britain would have to
pay the rest. I can see I think Major Cashin's
point. How is Great Britain going to pay that?
How can she send us over the dollars? Where is
she going to get the dollars? Evidently we will
have to supply the dollars for the time being
anyway, and I suspect that is what he had in his
mind. Anyway, they figure out that there will be
a total saving of $3 million, and it looks to me
quite sound.
Then they come on to the proposed expenditure
of $25 million... And then they logically go
on and ask themselves, "Where are we going to
get the money to pay for this?" And they quote
the 1940-41 revenue - $16.25 million — and
they tell us that in 1946-47 it amounts to $27.25
million, and that the indications were that for this
year, 1947-48, the revenues would come close to
the staggering amount of $40 million. Then,
having decided that, they take a very realistic
view of the industries in this country. They refer
to the value of the pulp and paper industry and
refer to the proposed expansion in the Comer
Brook area, and generally they say that the pulp
and paper industry in Newfoundland is tops.
They also refer, which I think does not concern
this report, to the possibilities of the pulp and
paper industry in the Labrador area; I think I must
touch upon this matter although I cannot see that
the revenues will derive any benefit therefrom in
the three year period which they forecast.... When
we think of the possibilities of a new paper or
sulphite mill in Labrador, or a new paper mill in
the Bay d'Espoir area, and the value to the
workmen, the clergymen, doctors, businessmen
and everybody, then I think we can take a pretty
good view of the pulp and paper industry, especially in view of the fact that they
inform us that
the Comer Brook and Grand Falls people have
contracts for the next ten years. Is that correct?
Mr. Hollett So there is nothing to worry about
as far as the pulp and paper industry is concerned,
656 NATIONAL CONVENTION November 1947
so far as we can see at the moment.
They go on then to mining and refer to
Wabana, with a payroll of $4 million or thereabouts. They also refer to the contract
of ore for
Great Britain of about 750,000 tons. We never
did ship very much ore to Britain prior to the war,
and we took that up over in London with the
Dominions Office, and they assured us that they
would do everything in their power to see that this
would be continued in the future. Then we have
Buchans. The lead and zinc and copper which
they produce always finds a ready market, and
they have a payroll of $1 million. La Manche,
they tell us, is about to be opened up, at least they
hope to open it up and find some lead there. Then
they refer us to the story we have heard about the
Newfoundland Labrador. All of us now have
heard of the Labrador Mining and Exploration
Co. The thing is so vast, and so huge, that one's
mind fails to grasp it. It is anticipated by this
company that they hope to find enough ore in a
year or so to warrant them spending $150 million
to open up the iron ore deposits down there. That
again would not come within the three year
period for which the Finance Committee has
made a forecast.
Mr. Chairman I am compelled at this time in
fairness to our reporter to declare a 15 minute
recess. Our alternative reporter is sick and is
unable to be with us, and you will appreciate the
strain under which Mrs. Abbott is labouring....
[Short recess]
Mr. Hollett Mr. Chairman, this new development on Bell Island, whereby they are shipping
ore to Great Britain, is really a peace-time industry, something that has grown out
of peace,
not out of war. There again you will see that the
Finance Committee was justified in being optimistic with regard to mining conditions.
The
same applied, of course, to the pulp and paper
industry. They are continuing. The war has been
over for two years and still they have all they can
produce sold for the next ten years; so we see that
when the Finance Committee took a glimpse at
that industry they were justified in being optimistic.
Mr. Butt No, just a point of privilege. A question. The contracts that are made with the paper
company, are they at a fixed price for the next ten
years, or is it not a question of price?
Mr. Chairman I don't know. In fairness to Mr.
Hollett I understand he is simply commenting on
the contents of the Economic Report. He was not
a member of the Economic Committee, and he
takes it just as is.
Mr. Hollett I could answer that, but I think Mr.
Butt could look that up himself and find out. I fail
to see how any company or individual would
make a contract for ten years at any fixed price,
but having due regard to conditions in the United
States, and the lack of paper in the United States
and Mexico and these places, I do think that the
price of newsprint in the future will not go below
$90 a ton, but will probably reach the amount of
$100 a ton... Then they took up the matter of
agriculture and referred to the new agricultural
development on the west coast, and arrived at the
conclusion that the value of agriculture was in the
vicinity of $15 million. That in itself is quite an
item, which the Finance Committee were right
and proper in looking at with an optimistic view.
And then they came to our basic industry —
the fisheries. They gave an exhaustive survey of
the fisheries... They pointed out that in the new
methods of curing, freezing, putting up the fish
in fillets and shipping it away, the enterprising
firms here in St. John's and elsewhere have invested the amount of $6 million. Now
I put it to
you that these enterprising men are not going to
invest $6 million unless they themselves have an
optimistic View of the future, not only for three
years but for a much longer period. I think the
Finance Committee were right and proper in the
conclusions they came to with regard to that.
Take herring. I remember the days when herring
was caught in a seine and brought in and dumped
on an American vessel's deck and frozen, and it
was only in the winter when you could sell them
anywhere, and they were taken out of the country
right away and shipped to foreign markets. Now
they have created all sorts of industries. Not only
do we Scotch-pack them, not only do we fillet
herring and make herring oil, but we do almost
everything with herring, and there again
enterprising businessmen have put their money
and brains into the development of the herring
fishery along lines whereby it will not only assure
a living to the people who catch herring and cure
them, but also it will offer them something in
return. Lobster. I just have to look down at my
November 1947 NATIONAL CONVENTION .657
friend from Lewisporte, Mr. Northcott, and he
could tell us more about lobster than we know.
Lobsters today are not canned so much as they
were in the old days, they are shipped away alive.
I would like to pay a tribute to my friends in the
co-operative business, for the manner in which
they have cornered this lobster fishery in their
area and arranged to ship them properly and
co-operatively, and thereby assure to the people
whom they are serving greater returns.
Salmon. Again, we have the same thing there
as in the lobster fishery. Mr. Job would be able to
tell us more about salmon, because I think he was
shipping them to England in a frozen state for a
good many years at any rate; but even today
salmon are at a premium, and are being shipped
away in the frozen condition. And then, as you
know, our seal fishery for many years has been
more or less a dud. Most of us remember when
we had eight or ten huge ships prosecuting the
seal fishery, and for some reason or other the
seals got scarce, or the market collapsed or the
strips were sold. For a good many years the seal
fishery just more or less faded out of existence
and gave no returns whatsoever to our people.
Now in the last couple of years you have seen
what has happened. That is not a wartime boom
— it is peace. We have starving people all over
the world, and we have unlimited fish, and therefore it is our job to have brains
and money
enough, government or otherwise, to catch and
ship it so that we can get something in return, and
our people can pay the necessary revenues into
our own exchequer to carry on our own government expenditures.
Mr. Chairman ....As a matter of general principle I think I should now lay down that all
questions arising out of the report should be
addressed to the chairman of the Finance Committee....
Mr. Smallwood ....In all parliamentary circles
when a member has the floor it is quite customary
for another who wishes to have the member
speaking, who has just made a point, to elucidate
a bit, to ask him to do so, if the member speaking
is willing.... In the House of Commons and all
parliamentary bodies, and in our House of Assembly, when a man had the floor if another
member wished to interject a question it was
regarded as proper to do so.
Mr. Chairman My ruling is according to the
rules of the Convention, and it is my duty to say
that a member occupying the floor shall not be
interrupted unless some member is arising to a
point of order, and if he does not like my ruling
he can appeal to the House.... We are in committee of the whole and the chairman of
the Finance
Committee is responsible for the introduction of
this report... It is his responsibility, and in fair
ness to all the members here I think the question
should be properly addressed to him.
Mr. Smallwood Again on that point. If a member on the floor expresses an opinion, or a conclusion,
may not a member seated, with the
consent of the member speaking, put a supplementary question to him? I don't mean
to
usurp his place, but in the manner: "Excuse me,
would you mind and he says, "Yes", and the
member speaking, if he wishes, can deal with it.
If not he can say, "You can have the floor later".
That's so customary in every parliamentary
body, and if we are going by parliamentary
rules....
Mr. Cashin We are a glorified debating society,
according to a judge of the Supreme Court.
Mr. Chairman This is really a glorified commission, and rules have been laid down by the
Rules Committee, which I am bound to enforce
without any reference to established British parliamentary practice... Are you ready
to continue
Mr. Hollett?
Mr. Hollett Thank you, Mr. Chairman.... The
whaling business is in a very flourishing condition, and the industry does give considerable
labour. All in all then, our fisheries last year were
valued by me, or at least that was the finding of
the Finance Committee, at $34.5 million. That in
itself is a huge amount of money.
Then there are our local industries which as
you know, are more extensive than they were....
These altogether employ about 2,378 men and
women, and the volume of business in local industries last year was practically $15
million, and
we did not have that after the last war, I remember.
There is one other thing that is neither fish nor
local industries, but which is very close to us at
this time. That is that American citizens are here
in their hundreds at the American bases, but by
reason of the fact that they are here we have some
3,500 men and women employed in these bases.
Now that is not a wartime industry either. These
658 NATIONAL CONVENTION November 1947
bases are here for 99 years. At the present time at
Harmon Field they are expending some $20 million, if my memory serves me right, which
means
that eventually more than 3,500 men and women
of this country will find employment at Harmon
Field and Argentia and here in St. John's.
I think, having looked at all these things, I
cannot conceive how any man in this assembly
could possibly come to the conclusion which they
did when they said that they could put our
revenue safely in the years to come at $30 million. They took account of a possible
depression.
On top of that they tell you we have new
peacetime industries which are not going to leave
and that is what we want. They have told us this
and I would almost be optimistic enough to put
the figure at a much higher price than $30 million.
Therefore I have to come to the conclusion that
they were very conservative in their estimate....
Of course if the whole world goes, we will not
need it then at all. They also pointed out the
possibilities of the Marshall Plan if it goes into
effect. We know the trouble we have had in
finding the price of our salt cod for the year. The
Marshall Plan would, I hope, cure all that. So as
we were on the top of the pig's back after the last
war I think we will be on the top of the elephant's
back in this peace, which I hope will last for a
long time. I commend very strongly the action of
the Finance Committee in coming to the conclusions which they did.
I want you to look at the table on page 33.
There you will find when making up the estimate
for $30 million revenue, they tell us where they
are going to get it.... Now just look at that table,
andI want to show you — mind you, this is a very
handy book, Mr. Smallwood...
Mr. Chairman What connection is there between Mr. Smallwood's book and the debate?
Mr. Hollett If you wish to adjourn the debate, I
shall have to ask to have the comparative statement of imports and exports by revenue
for the
years 1929-32.
Mr. Chairman Before you go on, am I expected
to presume that that book is an authority?
Mr. Hollett I was going to prove it from figures
in the book of the member from Bonavista
Centre, that went back to 1929. I did not have the
estimates in my office last night when I was
trying to think of this, and I turned to the back of
that book and it was there. In any book which our
friend puts out you will always find something of
value.
Mr. Hollett I have not read the seven, but I
would like to.
Mr. Hollett As long as there are no more fables
or fairy stories in them...
Mr. Chairman Unless it is accepted by the
house as being an authority, I must regard any
book which Mr. Smallwood has written as being
merely his expressions of opinion on certain subjects at the time the book was written.
We are not
discussing Mr. Smallwood's books, we are discussing the Economic Report.
Mr. Hollett Thank you very much. I hope that
will put you in your place. There is nothing
official in them at all... The Finance Committee
arrived at a point where they said: "Here we are
going to have a revenue of $30 million, and an
expenditure of $25 million, and that will leave us
a surplus of $5 million. Now turn to page 37. We
will see what they are going to do with that
surplus. They say: "The surplus which would be
shown on ordinary administration of government
affairs we suggest should be expended as follows: Additional Old Age Pensions ...$600,000,"
As you know, at the present time the government
are expending $250,000 on old age pensions.
Mr. Hollett Well, it is gone up then. $260,000,
and this Committee proposes to add another
$600,000 for our pensioners to endeavour to
increase their pensions, which are not enough,
albeit they only get $30 a month in Canada.
Mr. Cashin We are not going to take a mortgage
on his property when we give it to him.
Mr. Hollett I know that they do that, and they
take his property if he dies, but that's another
matter. You are not going to do that in your
Finance Committee.
Mr. Hollett I should think not. I think it is about
time the old age pension was increased, and I
hope it will be further increased. And while I am
on that point I would like to indicate the condition
of the poor in this town. I suppose it is much the
same as the condition in the outports. The man
who is out of work, or the women who is out of
November 1947 NATIONAL CONVENTION 659
work, what does he get? $11 a month to live on.
How would you live on $11 a month if you had
to? Would you know what to buy? I think not. If
there are two people needing relief what do they
get? $20.80, and that's for 30 days.... I hope the
Finance Committee will consider putting some of
that surplus to help those people who, through no
fault of their own, are unable to get work... Now
Fishermen's and Mariners' Insurance, and other
Social Services — $400,000. That is something
that many of us have been advocating for a long
time, and it is about time something was done
about it....
Now there was $1 million allotted for "Encouragement of Tourist Traffic by building
Roads from Port-aux-Basques to Corner Brook
— linking up Grand Falls and Gander, also
Lewisporte with Gander." You do remember the
remarks made about that paltry million dollars?
How much would it take? Our friend from
Bonavista said: "$1 million, you would want $10
million", but don't you see he is in a hurry to get
across the Cabot Strait. I say $1 million is not
enough too, but you have got to cut your garment
according to the cloth. This is only one/tenth of
the schemes; when and if we ever do get a government, their expenditure may be along
different
lines.
Then "Further encouragement and development of Fisheries, particularly Fresh Fish
—
$1,000,000." I am partly in accord with that because our saltfish products go to people
who are
low wage earners in Europe and the West Indies
and other places. They are not able to pay high
prices for saltfish. Saltfish is not worth a high
price, consequently if we are to raise the standard
of living of our fishermen we must enable them
to be paid more for their fish.... Mind you I am
not damning the saltfish trade, that's what I grew
up on. I dare say I cut my eye tooth on a piece of
salt cod. Our people here lived on salt cod, don't
forget that. There were no woods industries, or
mining industries, or anything, just salt cod, and
still they did not want to go across the Cabot
Strait. Now we have those new industries and I
am quite sure there is an unlimited future ahead
of us. Mind you, it is not going to be easy going
for everybody.... Our efforts for mankind are to
raise the number of people who can so get to that
standard of living where they will be able to live
in comfort, and I hope in peace.
Local Public Works — $500,000. I have nothing to say about that because I know very
little
about public works. Now the next one, Mercantile Marine — $500,000. That man yesterday
said, "$500,000, what are you going to do with
$500,000? You might just as well put it down
some pool or tank". That was the opinion of the
member from Bonavista Centre. "It is absolutely
useless to buy them now and sell them for half
price in two years", that's what he said. We are a
maritime people — wholly surrounded by ocean.
We are catching fish and cutting trees and making
newsprint, and digging out the ore, and we have
not got a ship — we may have one or two, but we
have no mercantile marine, and yet when the
Finance Committee suggests that they should
spend some money in order to build up a mercantile marine the man from Bonavista Centre
says,
"No, you are only wasting money." I put it to you,
is that sensible? $500,000 is not enough at all.
That will only build you a couple of small ships,
won't it?
Mr. Cashin You can get a ship, a nice ship for
$300,000. The Clarenville ships cost $300,000
each, and they can only carry 300 tons.
Mr. Hollett Then there's the Railway capital
expenditure too.
Mr. Hollett That is with regard to what you are
going to do with your surplus. Now turn to page
41. The honesty of that Committee, as I said
before, was brought into question, and in order
finally to prove that I think that any man who
insinuates anything against the honesty of these
men, or says they did not make an honest report,
once you read that paragraph on page 41 you will
see that these men were absolutely sincere:
In presenting this report on the economic
position of Newfoundland, we are aware that
in all respects we cannot, as in the case of the
Financial Report, deal with fixed values.
There are instances wherein we are unavoidably compelled to deal in the realm of
surmise and even conjecture. To some, this
may give the impression that we may be
colouring the picture to suit our particular
idea or political inclinations. Such however
is not the case. For throughout, our object has
been to try and give as accurate a picture as
we possibly can of the state of our country.
Any figures used by us have, in most cases,
660 NATIONAL CONVENTION November 1947
been already submitted to mis Convention in
the various Committees' reports and have
received the approval of the delegates. And
in cases where we do express opinions we
have taken care to have their correctness
endorsed by those competent to do so.
Now I ask you, do you think that this Committee were not candid when they presented
this
report for our consideration? Anybody who
thinks so should be examined. Then we go a little
further down in the next paragraph. "We are
conscious of the fact that there may be some
delegates who will be satisfied with nothing less
than an absolute gilt-edged guarantee of our solvency for the next 20 years, before
they will
accept the fact that Newfoundland is self-supporting." So they were under no illusions.
Now
about this matter of self-support. Luckily, under
the Convention Act, Major Cashin, you did not
have to decide whether we were self-supporting.
That was the people away back in 1933 in the
Newfoundland Act. They said, "You can have
your government back when you are self-supporting", but not the Convention Act. They
say,
"No, you have to consider the financial conditions of this country due to wartime
conditions
etc., and satisfy yourselves, and make some
recommendations." You did not have to find out
whether we are self-supporting. No country in
this world is ever self-supporting, no man or
woman is ever self-supporting over any predestined period. This country, Canada, Great
Britain
— the mother of a good many countries, the
country which we thought in our young days
would be always self-supporting. She is not, and
never was, and never can be. Don't let us forget
that we ourselves can never be self-supporting for
any particular period. We can only hope and pray
to Almighty God that prosperity will continue to
keep us self-supporting as long as possible. So
you did not have to decide, although you said we
are self-supporting. There were some remarks
made yesterday aboutoptimism, realism and pessimism. The gentleman from Bonavista
Centre
says you are too optimistic. I don't want it optimistic, or pessimistic, but realistic.
I ask you,
who is a pessimist in this House? Is it not the man
who said these words yesterday?
I am afraid I have taken up a lot of your time.
I did not intend to speak nearly as long, but as I
went along I thought I might just as well finish
my review of this report, which I think is an
excellent report, and I have no fear whatsoever in
recommending that when the time comes to vote
upon it, it is your bounden duty to say, "Yes, we
are self-supporting. The report is all right as far
we can see." Never mind the experts and statisticians you are going to bring in. We
are supposedly commonsense men, and sometimes I think
statisticians are not. They are ordinary men, they
will bring you in a set of figures which you can't
possibly grasp or understand...; but you are hardheaded businessmen, every one of
you 44 men,
and there is that report, and I ask you to read it
and ask yourselves, "Is that a fair report?" Think
of the new industries. Think of the fisheries and
mining and forestry, and all the others. Think of
the $25 million that's in the Bank ofNova Scotia.
Think of all these things, and you will have to
come to the conclusion that they have brought in
a fair and honest report, and that we are self-supporting as far as it is at all possible
for us to be.
Mr. Vardy Mr. Chairman, after making a very
careful analysis of the figures and statements
made in this report, my wonder is how any person
continuously accused of being crammed full of
politics could bring in such a comprehensive,
informative, and conservative estimate of the true
economic position of Newfoundland. There are
no wild, exaggerated statements.... Treating the
overall picture as we should, and as we would a
private business, our liquid position is most encouraging. If we were attached today
and sold
lock, stock and barrel, we are solvent and would
have a surplus after all creditors were paid. The
Ottawa delegation has done a splendid job by
confirming in substance and in fact the essence
of everything contained in this Economic Report
and for this they deserve our congratulations. I
would say to these gentlemen, stick to your guns,
you have built a good case and some day you may
have a chance to see your dreams come true; but
do not come back and before the ink is dry on the
paper tell the world you painted a false picture
and were just trying to get money from Canada
under false pretences. This will react badly and
will cast a reflection on the whole delegation. We
have agreed the country is watching, other
countries beside ours are watching also, and they
will judge us on our merits by the permanent
good and loyalty that is in us.... We all have a
common duty to perform, regardless of the par
November 1947 NATIONAL CONVENTION 661
ticular form of government we favour. That duty
is to restore and maintain lost confidence and
pride in Newfoundland. We owe this to those
who sent us here and to ourselves. This document
is a contribution toward this end and let us adopt
it without delay after the meat from it has been
handed to the public through debate.
While we know there has been an enormous
amount of waste, the same applies to every
country on earth. Yet when we look at our vast
coastline and consider the huge area over which
we have to serve such a very small population,
the amount spent even on capital account is negligible and ample justification exists
for this
moderate amount, for which we have fair value
on the credit side of the ledger.
There are enough concrete facts in this report
to convince the strongest critic that the charges
so frequently laid against past statesmen in this
country were, on the whole, unwarranted. A net
debt of about $35 million after 450 years of
inhabiting and opening up a wilderness is not a
bad showing. The amount at credit to capital
account of treasury and people of $150 million is,
in my opinion, most conservative. I feel
whichever government succeeds the present,
steps should be taken to effect a saving on our
interest, and if possible transfer our debt to the
dollar area by floating in the United States or
Canada.
I feel the merchant navy branch of the service
should have been segregated from the Railway
many years ago; but now that we have acquired
that magnificent property known as the naval
dockyard the time is even more opportune to
create a fleet manned wholly by Newfoundlanders which would not only serve
Newfoundland in peace but the general allied
cause in war, which is inevitable on our shores. I
do not treat the suggested half-million dollars as
a waste, neither would anyone who has a true
sense of appreciation for the men who manned
these ships in the dark days of 1939 to 1945. We
are on an island, we are not self-sufficient, and
we must of necessity have ships to bring food to
our shores and our fish and other products to
foreign markets.
With reference to Gander airport, it just does
not make sense or reason for Newfoundland to be
maintaining this terminal chiefly for foreign airlines, and showing a deficit on the
operation.
In an unsettled world no country can forecast
exactly what may happen. The compilers of this
report have, in every paragraph, kept within the
bounds of reason. Our paper industry is making
rapid strides, which can only be retarded by a
general depression in our foreign markets. Our
mining industry is only really being developed in
a small way in comparison to what Newfoundland offers in this field of employment
to
men of initiative and capital. Agriculture in a real
way is only in its infancy, and despite our climate,
vast and rapid improvements are being made in
producing fruit and vegetables in a really big
way. What we need now are proper storage
facilities to save what we grow. Our fishery
products will represent the most important part of
our economy, and as we have only recently
entered the machine age in this respect, we can
from now on compete with the modern product
and can hope for fair returns.
It has been generally agreed that it would not
be a very wild guess to say that the gross earnings
of our people at present exceed $100 million
annually. If this is correct the Economic Committee is justified in expecting a revenue
for the
foreseeable future of $30 million.
Social improvements will be made because
we are in an age of social reform, and no government will try to impede progress in
this direction.
Therefore fishermen's insurance, improved old
age pensions, increased widow's allowance and
all the rest, will come as the evolution of the time
and age we live in, and not as a result of any
particular form of government. Therefore I subscribe my name to the belief that Newfoundland
is at present a self-supporting country based on
sound economic factors; and that all the evidence
available to us indicates that this position of
self-support will continue in the foreseeable future.
Mr. Fogwill Mr. Chairman, this Economic
Report is the last report to be presented to this
Convention, with the exception of the report of
the Ottawa delegation. This report is beyond
doubt the most important of them all. In respect
to the financial side of the report, I do not intend
to try and develop any long thesis in support of
the idea that this country is, and can continue to
be, self-supporting. I am not going to produce a
maze of figures and percentages dating back to
the days of responsible government. What we are
662 NATIONAL CONVENTION November 1947
trying to do is to find out if our island is self-supporting. How are we going to
define the term
"self-support" as it applies to Newfoundland?
To be self-supporting means the extent to
which the people can produce the necessary
goods and services in sufficient quantities to
maintain its population in reasonable comfort,
and that can only be done by the effort and ability
of the people themselves, to provide these goods
and services from the natural resources at their
command. There is no standard by which we can
measure self-support; as a country is developed
its standard of living is measured accordingly. As
an example, compare the standard of living in the
United States and Canada, 100 years ago with
that of today. Do likewise for Newfoundland, and
judge for yourselves. I maintain that we in Newfoundland have progressed in parallel
with our
western neighbours. I am not trying to convey the
idea that our standard of living is equal with those
countries, but rather, our program has been comparatively even. I want you to consider
our
retarded development of the first two centuries
after discovery, which, historians claim, was
planned as a deliberate act, We were a very late
starter in the race of progress.
As far as the revenue and expenditures are
concerned, for the period which the Committee
had under review, if we go back further than that,
we find that for very near a century, since 1856
to 1947, this country has accumulated a national
debt of only $72 million. If we consider the late
start of our national life, and if we consider the
cost to Newfoundland for her participation in two
world wars, then I maintain that our national debt
is a paltry sum indeed. Perhaps if our national
debt was ten times as great, we would have more
friends. The Committee has shown quite clearly
that as far as revenue and expenditure was concerned, the record is good, most definitely
good.
In respect to the economic side, it is evident to
me that in regard to the fishery, forest and mining
industries, the Committee has reviewed all the
evidence and factors pertaining to those industries, and have made their forecast
accordingly. To some members, the forecast may appear to
be too optimistic....
There is another section of the report on which
I want to say something, and that is in regard to
agriculture. The Committee has not been too
optimistic in their forecast. Our agricultural industry is capable of being expanded
to at least
twice its present value. I want to point out some
very pertinent facts. During the 20 years immediately proceeding World War II, this
country
imported approximately $60 million worth of
farm produce. This volume of imports was composed of only those articles of food which
can be
produced here in this country by our local
farmers. I am going to quote three items of food
imported during the 20 year period mentioned:
imports of eggs — 3,361,300 dozen; milk —
50,140,920 liquid lbs.; meats — over
380,899,700 lbs. Or, if we take it another way,
and include imports of vegetables we find a total
of over 300,000 tons of food imported during
those 20 years. Here we have one of the causes
of our troubles, an undeveloped and unorganised
agricultural industry. This condition can and
should be corrected. I believe that with the proper
farm marketing organisation, and with more encouragement and determination on the
part of our
citizens to obtain their requirements from our
local farmers, such a large volume of imports can
be considerably reduced.
I am declaring myself in support of the
opinion that this country is self-supporting now,
and we can continue to be self-supporting in the
future. I for one am proud of our historic record,
Lord Amulree to the contrary notwithstanding,
and I feel that we would have made progress
along regular and ordinary lines without the intervention even of World War II, with
its so-
called boom of non-productive prosperity. We
are no different from other people of the world in
matters of native ability, industry and vision.
What the future hold for us is anybody's guess.
That holds good for every country, and our future
depends entirely upon our own efforts to make
that future as bright as possible.
[The committee rose and reported progress, and the Convention adjourned]
