Mr. Cashin Before we proceed with the
business this afternoon, I want to
express to you, Mr, Chairman, my apologies for
yesterday afternoon. I am very sorry indeed that the
incident occurred.
Mr. Chairman Thank you. That is very kind and gracious of
you.
Mr. Newell I am not going to address
myself at any length on the contents of this
Economic Report and hope I will not in any way
disturb the even tenor of our ways with which we
started this session. There are a few comments I
must make about our economic condition generally. I
am not going to quibble about individual sections,
sentences, figures or anything in
the report which, allowing for human fallibility,
presents a fairly comprehensive picture. However, I
would like to compliment my colleague from St.
George's West who, while he did not see fit to sign
the Economic Report, nevertheless gave a very clear
and concise expression of the point of view he
holds as a co-operative worker, and which, also as a
co-operative worker, I hold....
On questions of economics there is bound to
be disagreement, because we all see things from
different points of view. Certainly, when we
come to speak on the economic position of our
country, which is a matter of grave concern for
all of us, there is room for wide disagreement.
The thing that bothers and annoys me is that we
seem to have run into a son of iron curtain which
separates us into different and opposing camps
and through which we find it difficult to see.
Looked at from my attitude towards economic matters, there are certain things about
this
Economic Report and the discussions on it which
we have tended to overlook. I think, like the rest
of the world, we are a little too much concerned
with money. That is one of the fallacies of the
materialistic age.... There are other things besides
money. Let me say that I reiterate the views
expressed by another delegate some time ago in
discriminating between money and real value. I
feel the discussions have, in other than one brief
reference, overlooked the question of value. We
have not taken into account in assessing
economic value, the value of the dollar. Money
is a standard of value. It is not wealth.... We have
to take into account such things as our $80 million
in savings today, which may not have a great deal
more purchasing power than the $25 million we
had in the Savings Bank in 1934. I must hold the
view that the war economy has affected the situation. The effect of the war, in my
view, was
whilst it increased our cash savings, at the same
time it placed a limit on the purchasing power of
these cash savings.
The question of real values was brought to my
attention by a person who is not an economist - he is a fisherman. They were arguing
about the
cost of providing twine for a fish net. Today,
although you had to pay more for twine, he argued, it was cheaper than it was ten
years ago,
because whereas it took ten cases of salmon to
get it then, today you get it for the price of one.
The difference in the price in salmon was brought
about from the co-operative market.
There has been a great deal of talk about
optimism and pessimism. I am optimistic because
726 NATIONAL CONVENTION November 1947
of a certain unit of statistics not in here at all.
There are 10,000 people in the co-operative
movement in Newfoundland, where in 1934
there were not any. If there were we will probably
hear from them.
A lot of our troubles here might have been
saved if we had agreed at the beginning of the
debate to define our terms. I do not hold entirely
with the view that debating a report is a waste of
time. I can sympathise with that view, and particularly after hearing some of the
debates we had
on some of the reports. I feel the big question is
not the report; it is the economic condition of the
country. If the report serves no other purpose than
as a starting point from which to assess the
economic condition, it is our business to evaluate
the economic condition as we see it, and get on
with what we are going to do about it afterwards.
Perhaps if we had defined our terms we would
have saved ourselves a great deal of needless
discussion. There is the term "country". There is
the term "self-supporting". It has been said here
that no country is self-supporting; in that case
there is no use discussing it. Suppose we use the
word "solvent".... What do we mean by "the
country?" Do we mean the government of the
country? I would excuse, readily, any man who
had spent considerable time in the government,
if such a one were to consider the country as the
government. I find it less excusable for a representative of the labour movement referring
to the
government as the businessmen of the country.
Democracy must be in the interest of the
majority. We must consider whether or not the
country is economically sound on the basis of
whether or not the economy is sound in the interests of the majority. We must consider
whether
we are completely and 100% self-supporting; we
are not, if you think of all the people who are
more self-supporting than in 1934. And yet I
wonder if that is a fair comparison to make. In
1934 we were going through unusual times. It has
been said that the world was upside down. It was
inside out also. Has the position of the majority
of the people changed in relation to the economic
entity that is the state? As one interested in these
matters in point of view of co-operatives, that is
something which causes me very great concern.
....I hold and have held for many years that this
country is capable of producing a frugal living for
the majority of the people. I do not think that such
is possible under the economic set-up we have at
the present time. I think we need better economic
arrangements than we have. I do not think that
under such an economy there is room for millionaires —I would like to see 325,000
of them
here in Newfoundland. I do not think our
economy can make the majority of people self-
supporting and still allow 66 corporations in a
population of 325,000 people declare net taxable
income of $250,000 each; which makes it one for
every 500,000 population.
Also I do not agree with the philosophy which
expresses itself in these terms, "the poor you have
always with you". That was the attitude adopted
by tired and effete governments a little over a
generation ago, that produced in large measure
the chaos that we have in those countries today.
The modern statesman does not accept that view.
It smacks of defeatism. It is certainly not a
philosophy for avowed optimists.
I find it necessary, when considering a subject
like the economy of our country, to be critical. I
know that I will be accused of running down
the country. I will, perhaps, be further accused of
running down the country if I suggest that if you
put a group of Scandinavians in southern
Labrador or northern Newfoundland they would
make a good living for everybody. Why? Because they would work harder? No, they
couldn't. Because they have a different sense of
social justice from ourselves; because they have
a co-operative economy based on that sense of
social justice. One thing has not changed since
1934 — there is just too much of every man for
himself; we want to make our own little pile
quick. Perhaps this would be a good time for me
to disassociate myself from the 44 hard-headed
businessmen we are all supposed to be.
I find very little in the report relating to the
standard of living of our people. I want to make
one discrimination of terms between standards of
living and scales of living. By "scale of living" I
mean that which we have achieved as compared
to that which we aim at — which is the standard.
Our scale of living has immeasurably improved
since 1934, but if our scale of living has improved, standards have also gone up since
1934.
We must consider...is there enough left over unto
our people to provide them with the good things
of life? You will notice I have upped the ante
from three square meals a day. My contention is,
November 1947 NATIONAL CONVENTION 727
it is possible for us to do that, but it is only
possible if we realize our shortcomings and are
prepared to start in realising them and working
for a more socially just economy.
....I agree with the two members who said it
was not necessary for the Committee to prepare
a budget; but having prepared it, it is subject to
our scrutiny. I wonder if in making up allowances
for old age pensions the Committee is not basing
the estimate on the standard of old age pensions
given today? I worked it out myself.... I am
puzzled just what we will have to do to qualify
for one of these pensions. In a matter such as that,
I think the Committee's estimate is too low.
I am not going to discuss either the merits or
demerits of setting up a merchant marine. I do not
think it is incumbent upon the Committee to
make such recommendations at this time. However, if you are going to discuss such
things,
perhaps it would be well for the Convention and
the Committee to discuss not only the setting up
of a merchant marine, but also the setting up of a
Crown company to run that paper company on
the south coast in which there will be a great deal
of money. All our wealth in one form or another
is being shipped holus-bolus out of the country.
We have no control over it. We benefit very little
from it except in the matter of labour. While I am
on this subject, I might offer this suggestion: how
much stronger would the economy of this country
be if the $8 million we have invested in the banks,
were invested in organisations which could put
that capital to work here in Newfoundland. Because capital is the means of production,
and as
the report shows we have twice as much money
as we had in 1934, or more. I imagine in the case
of capital goods as well as money, we are also far
ahead of 1934, and our means of production is a
great deal ahead of what it was in 1934. To what
greater extent than in 1934 is this means of
production controlled and used by and for the
people? The means of production, whether it lies
in the Savings Bank, insurance or other forms, are
being shipped out of this country and being used
to produce wealth for other countries.
[1] Presuming that the means of production is twice as great
as in 1934, is Newfoundland producing twice as
much wealth? Is the Labrador fishery twice as
great? Are we producing twice as much salmon,
timber, and so on?
Newfoundland is hitched to the banking system of another country, with the result
that real
wealth leaks out of this country. Consequently,
Newfoundland money is being used to develop
and create wealth in other countries. As things
stand at the moment the Canadian banks could
depreciate Newfoundland's savings by 10% or
15% at a stroke of a pen, and Newfoundland
could not do a thing about it. One of the primary
functions of a bank is the control of credit, and
the control of Newfoundland's credit is vested
with outside interests. This control could be used
to Newfoundland's disadvantage. When Newfoundland went broke in 1934, for example,
there
was $25 million in the banks. Yet the government
could not borrow this money. Newfoundland
could not control the financial system, and thus
was not an independent financial unit.
Another point in Newfoundland's economic
set-up which bothers me is that this country has
little control over the production of foodstuffs.
The question of Newfoundland's ability to
double her agricultural production has been
raised. But I wonder how far it can be pushed
towards covering essential supplies. I am of the
opinion that the gap left between this production
and the actual requirements represents the degree
to which Newfoundland must export or perish - in other words, the degree to which
Newfoundland is dependent on other countries, and
thus the degree to which Newfoundland is dependent on the export policies of these
other
countries.
I want to disassociate myself from the report's
remarks on a lack of faith in the country. Actually
I prefer the word "trust" to "faith". The people do
have hope for the country, and if they lack trust,
it is a lack of trust in political leaders. They need
new leaders, or old leaders with new ideas. The
report is definitely wrong in suggesting there is a
lack of hope and trust. A recent storm did $ 10,000
worth of damage in one settlement. But the
people did not sit back and bemoan the fact, they
began to rebuild.
The report ends with the words of President
Roosevelt: "We have nothing to fear but fear
itself". The people of Newfoundland are not
afraid. If they are, perhaps, afraid of politics, it is
728 NATIONAL CONVENTION November 1947
because they have never controlled politics.
Going on to another statement by Roosevelt
about four freedoms, you cannot have political
freedom without economic freedom. And given
the latter, people would be less hesitant about
taking over their political responsibility.
Roosevelt's freedoms are passive freedoms:
freedom from want, freedom from fear, etc. I
prefer an active freedom. Freedom to — freedom
to live in comfort and basic security; freedom to
buy food and education for children; freedom to
develop natural abilities.
I feel the Convention's discussions have not
gone deeply enough into the roots of things.
There are inequalities which stand in the way of
economic and political freedoms, and in the way
of social justice. I wonder if it is not time we
examined our methods and attitudes. The attitude
taken in economic matters will go far in determining the action taken in political
matters. Old
age pensions and fishermens' insurance are not
enough. They are only salve where surgery is
needed. The Convention's search for political
constitutions will be ineffectual if it is not allied
to a desire for social justice, and an economic
set-up more in keeping with the principles of
Christian democracy.
[1]
I maintain that how we think about these matters will determine our choice of a constitution.
We must take chances on the future, but our job
is to reduce those chances as much as we can.
Neither optimism or pessimism will get us
anywhere. We must know where we stand. It is a
grand thing to walk with your chin up, but we
must have our feet on the ground. If I have a
criticism, it is that I have wondered if our feet
were planted on the ground.
I have tried today to get outside of the political
issue. I have considered it, if not as an anarchist,
than as one who is not interested in any particular
form of government. One point and I will close.
In the early days we heard a lot about an open
mind, and I doubted then that there was any such
thing. But I say now that I do have an open mind.
Mr. Bailey I must apologise to the people for the barrage
of words from the National Convention, but I must
give an explanation as to why I feel this country is
in a sound economical position.
Full justice cannot be given to our position
without considering the epoch we live in. Much
can be done for a country to solve its internal
problems, but this has a limit. For example, the
first blow to our economy was a revolution in
Brazil, then sanctions against Italy. Both of these
contributed to our economic state. If one studies
history then one will see that whenever there is a
war there is a surge forward in human endeavour.
War and revolution bring men to their best, and
make them see clearly. If we had had a war near
our shores maybe we would see clearer. Today's
events are the greatest leap forward the world has
ever seen, and the future is bright. Notwithstanding what our pessimists say, that
wave of progress
will reach us here in Newfoundland. The
Americans are spending billions of dollars on the
Marshall Plan, and we should keep this in mind.
You should examine the conduct of the United
States, and ask why they care about people
thousands of miles away. In the 1920s the US
withdrew into itself and left Europe in a slum of
poverty and discontent, in which fascism grew.
But that is not happening now because great
minds are working against that, because we are
all in the front lines now. The world has learned
that it has to help itself. And the benefit of that
will come to Newfoundland. There cannot be
another world depression, and that's the reason
that I know government revenue will stay up.
[2]
Ask ourselves the question and think deeply
about it: is the great USA, having shouldered the
expenses of the Marshall Plan, and aid to Greece,
Turkey, UNNRA, and the other billions the world
will want, going to sit idly by and allow the
eastern tide of communism to swamp all the
sacrifices that the US government and people will
make? All of you can and do remember that not
alone Newfoundland, but the world was poorest
when all the necessities of life were most plentiful. Can anybody believe that the
veterans of this
war, not only in the US, but all over the world,
will sell apples on the street corners? If you do,
then you have another guess coming.
The bomb that fell on Bikini cleared many
more cobwebs than that, and whether we have
capitalism or communism or socialism or
whatever ideology we are burdened with, there
November 1947 NATIONAL CONVENTION 729
must and will be a free exchange of goods
throughout this earth.... I believe we are on the
threshold of a new world, and we, as a free
people, should gear our productive capacity, and
hand in hand with our comrades throughout the
world look forward to that day when the fear of
not having the three meals a day, the tight roof
and the clothes to cover, will be a thing of the
past. The day won't come again when my genial
friend, the member from Green Bay, will have to
go through Naples or Leghorn or even Oporto,
with a yaffle of fish, rolling a roll of paper before
him, trying to sell them, and neither will anyone
be able to make a couple of thousand dollars
before breakfast. It seems that this is what our
pessimists are afraid of. I am fully persuaded that
these days are past. Those who control the wealth
of this world cannot afford to let them come
again, because if they do then all hell will break
loose.
I know a little of the feelings of the underdog.
I have given this extensive study, talked with men
high in labour movements as well as the rank and
file, both on this side of the Atlantic and on the
other side. Labour is getting more world-minded.
You'll see, if a country has a strike, then other
countries won't scab.
These are the reasons why I strongly believe
in this report and would emphasise the fact that
we should get ready to take our place in the
economic niche allotted to us by nature. Let us
fulfill our destiny like men unafraid.
Mr. Butt You refer to the amount of
savings and insurance. Did the Committee take into
consideration the amount of money
invested in stocks and bonds available for capital:
and also current interest as well?
Mr. Cashin You will appreciate that
would be difficult under the circumstances. We would
have to go to the Registry of the Supreme Court
to see what stocks and bonds are held by individuals. We know there are a number
of people holding stocks and bonds of which we know
nothing; there is no record of them.
Mr. Butt There is no mention made of
that, and it must be a considerable amount. There
must be a considerable amount of money invested
outside the savings banks.
Mr. Cashin There were $5 million in
loans
raised locally; you have war savings certificates
also. The deposits in the banks is actual cash. War
savings certificates were $2 million. That is
another $7 million. We know it is around there
somewhere. There are other stocks and bonds -
Canadian bonds, bought during the war. We could not
check up on them.
Mr. Higgins We have $6 million in the
fresh fish industry alone, have we not?
Mr. Cashin We mentioned that as being
invested in the fresh fish
industry. A lot of it has been exported to bring in
machinery, equipment, etc.
[1]
Mr. Miller At this stage of our
deliberations, there are two documents that concern
us most. One is the report of the Royal Commission
of 1933 under the chairmanship of Lord Amulree...
Mr. Chairman No, I have no reference, we have nothing to do
with that at all.
Mr. Chairman No ... nothing to do
with the terms of the Convention Act.
Mr. Miller All right then, sir. I
presume I could draw some comparisons with condition
of the country when Lord Amulree made that report?
Mr. Miller To this I might add as a
sidekick the report of Chadwick and Jones.
[2] Now, if I make
comparisons, this Amulree Report, it presents a
story of conditions and reasons therefore. Submitted in the report are plain
admissions that we are not self-supporting and it
makes recommendations for its correction.
Our Economic Report takes into consideration the
results of these recommendations, or as we know it
better, the reconstruction programme of Commission
of Government up to and including the war period,
and assessing this latter period as well. It deals
with our main industries, our revenue, and refers
to the fact that our national debt, $101 million in
1933, is down to $35 million in 1947. It gives our
deposits in the bank, $26 million in 1933, at an
all time high of $80 million today. It is helpful
then, and interesting to make these comparisons.
1933 — might I be permitted to put the terms of
reference of the Newfoundland Royal Commission, 1933, in comparison with our
terms of reference?
730 NATIONAL CONVENTION November 1947
Mr. Chairman No, Mr. Miller, I don't
want to, because if a precedent is established in
this case, it lays a foundation for more serious
departures than in the past. We'll have to remember
this, that this Convention is constituted by
legislation of the Commission of Government. Now the
functions and duties of this
Convention are set forth in section 3 of the act,
and they are of a three-fold character. Any is not
to be referred to unless of course it is
incorporated by reference into the act constituting
this Convention. You have to understand,
your functions and duties and your liberties and all the rest are strictly defined
by section
3. Therefore, if you can read in the Letters Patent
suspending our free political institutions, if you
can do that, then of course there is no limit
beyond which ...
Mr. Miller ....I intend to confine my remarks to the
economy of the country and to the survey made by Lord
Amulree at that period. And to draw comparisons if I
may with our present economic ...
Mr. Chairman If you don't mind, Mr. Miller, I would prefer
if you would deal with the condition of things as
Amulree found them. And deal with our present
position if you don't mind. If you would disassociate
the Amulree report with anything you have
to say then as far as I am concerned it is
wide open.
Mr. Miller Well, turning to this Amulree Report we find
such passages as this: "The broad facts of the
financial position in Newfoundland are unfortunately
all too plain. Ever since the war period the country
has been living beyond its means. The Island is now
in extreme financial difficulty." That is about our
finances and our economics at that period. Now our
Economic Report presents a budget, and a loud clamour
is raised that its proposed expenditures are too
high. We want more for this and more for that. We
want to repeat the mistakes of the 1920s — spend our
surplus and have nothing for the rainy day. And
yet in the same breath they claim that three years
is not enough to look ahead — it must be 20, 50
years, what fantastic reasoning....
Again, 1933 — "The situation today is that, as
a result of the extravagance of the post-war
period, a debt has been incurred which is out of
all proportion to the country's capacity, and we
cannot avoid the conclusion that, given this scale
of indebtedness, there is no prospect of the Island
being able to pay its way even under normal trade
conditions...."
[1] In the preceding paragraph they
give the national debt as $101 million, or a per
capita debt of $400. These are the facts, Mr.
Chairman, and in the calmer moments of our
deliberations let us neither neglect nor fear to
analyse them....
And so submitting these passages from the
Amulree Report, I expect to find comparative
answers in our Economic Report on present day
circumstances. On page 41 of the Economic
Report, "all throughout our object has been to
try and give that good a picture as we possibly
can of the state of our country. Any figures used
by us, in most cases, have already been submitted
to the Convention in the various committees'
reports and have received the approval of the
delegates. And in some cases, where we do expect opinions, we have taken care to have
their
correctness endorsed by those competent to do
so." With these remarks for a background they
continue on page 43, "Our present revenues
therefore, are substantially solid in their structure
and seem capable of carrying on without any
serious decline. However, in estimating future
revenue, we prefer to err on the conservative
side." From there it goes on to say that whereas
present revenues have dropped at the $40 million
mark, in their budget, they make allowances for
a drop back to a normal figure, back to $30
million. Dealing with the country's capacity to
maintain this greatly reduced figure, a step-by-
step presentation of the position of our country's
industries is submitted. And may I be again permitted to examine briefly and compare
just a few
with the findings of previous investigators? Mining — very conservatively the Amulree
Report
said, "In general it may be said that the possibilities of mineral development in
Newfoundland have been by no means exhausted."
What does Chadwick and Jones say? Very discreetly they sum up, "it is not however
possible,
at this stage, to indicate what effects these
developments may ultimately have on the economy of the Island". What does our Economic
Report say, page 17. Summing up on the sale of
iron ore it says, "Thus we feel that under
November 1947 NATIONAL CONVENTION 731
reasonable conditions a continuation of the industry can be reasonably assured." I
put it to you
Mr. Chairman, that that statement is just as conservative and just as discreet as
the report of Lord
Amulree or the report of Chadwick and Jones...
Well, Mr. Chairman, I think I have full right to
refer to a report of Chadwick and Jones.
Mr. Smallwood The Chadwick-Jones
Report is a report that was compiled by the British
government for this Convention.
Mr. Miller I'll read a passage to
you, Mr. Chairman. Paragraph 3. "It was
also proposed that His Majesty's Government should
prepare and make available for the Convention when
it meets a factual and objective statement on our
economic situation. This would analyse development
in revenue and expenditures since 1934, the particulars of maintaining the various
public and social services, review the country's
import and export trade, and the main branches of
its economic activity, and survey the principle
lines of policy followed by Commission of Government and their financial implications."
I read that for you because as I see it, financial
implications are subject to change with change of
policy, as we are asked to consider policy.
Therefore if we cannot deal with possible changes in
policy, which must necessarily come with possible
changes in form of government,
well, I think that those who compiled the
Chadwick-Jones Report were a little bit astray or I
am afraid we are astray. But I do feel that I have
every right to refer to Chadwick and
Jones.
Mr. Chairman I do know that the
Chadwick and Jones Report had been prepared for the
benefit of this Convention, I did not know your
intentions, but you are perfectly in order. I was
wrong.
Mr. Miller I have no business, no
intention of trying to make your road any harder to
travel than it purports to be.... Mercantile
marine.... Now what does Lord Amulree say. I'll
quote again, "We have already indicated the serious
loss which the country generally, and St. John's in
particular, suffers through the absence of a local
mercantile marine. It is, to say the least, highly
anomalous that in a maritime country, proud of
its seafaring traditions, with an extensive European
and South American trade, use should be made of
foreign vessels to carry its products to market. It
is still more anomalous that the foreign vessels
generally employed for this purpose should
be those of a nation which is one of Newfoundland's
chief competitors in the codfish markets of the
world."
[1] Lord Amulree
concludes, "We content ourselves with recording the
facts and suggesting that a special enquiry should
be instituted, with a view to the elaboration of a
practical scheme for encouraging the formation
of a local carrying fleet."
[2]
I am satisfied that the Economic Report has been
constructive in their suggestions. Agriculture. As I
foresee the future of agriculture in Newfoundland in
its different phases ... I would say that its
possibilities are unlimited.... I base my
conclusions on the progress made over the last 15
years. And if I must, I give credit for it to the
reconstruction programme of Commission of
Government. Our people have become farm conscious.
We have started an era of commercial farming. True,
we are late, as some speaker remarked a few days
ago, we come in a period when pioneering is a
forgotten word and competition from farm
mechanisation confronts us. Despite all this we are
progressing. We are equal to the task, and nothing
can more effectively cushion a national setback in
any country than the products of the land. It's as
symbolic as the action of a man who throws himself
on the ground when an explosion passes over him. But
these prosperous years have not tended to continuity
of purpose. Money came easy of late. Further, the
high values for cattle encouraged people to sell
perhaps a little too much. Add to this the meager
supply of cattle feeds, and there a new phase of
farm life must be tackled, the cultivation of seeds.
This may take half a century to climatise growth,
but it can be done and will be done. The greater
purchasing power of our people and the greater
distribution of money has created demand. Our farmer
is watching as keenly as he watches the farm life,
the plant life he fosters. Again I am satisfied to
think that the economic committee has been correct.
732 NATIONAL CONVENTION November 1947
Fisheries. The most unnerving feature of
Newfoundland life is, or was, our dependence on
the fishery. In the past it was the incontestable
argument explaining our slow advancement and
low standards. In prosecuting this industry we
were not alone in the world. We were unquestionably left with a bounty of supply,
but we were
carefree, we were lax. Our government, our merchants and our fisherman were all to
blame for
the gradual loss to competitors of our markets.
And so the tide flowed against us, and this had
reached crippling proportions by 1933. Let us not
lose sight of the fact that whilst we were sliding
downhill our competitors, Norway and Iceland,
were consolidating their positions in the fish
markets of the world. Iceland's dependence on
fishery was even greater than ours. I'll have to
give you some figures on just what Iceland did in
comparison to Newfoundland's progress. I am
forced to give them, because we had an argument
that Newfoundland was producing more than the
demand was capable of absorbing. In 1885
Iceland exported less than 100,000 quintals of
wet and dry salted codfish, Newfoundland 1.3
million. In 1932 Iceland exported 1.5 million
quintals and was then ahead of Newfoundland by
450,000 quintals of fish. I presume that they sold
all that fish, that there was no overproduction.
They produced it and they sold it, and we lost the
market. And if you read the papers today we will
find that we are losing markets in herring too.
These are figures. Production must always keep
a keen eye to the requirements of demand. In this
we were neglectful. However, that age is past.
Perhaps slowly but surely, Newfoundland's fish
is finding an honoured place on the food counters
of continents far and near. This has been brought
about by the combined effort of government and
capital and has been furthered, in no little
measure by the vigilance of the fishermen themselves. Perhaps the most reassuring
event of late
was the recent increase in the price of fresh fish
at some of our larger filleting plants. Yes, the
weaknesses of our old position have been recognised and are being corrected — corrected
by
Newfoundlanders themselves. Read the
Economic Report on this, page 26. It says,
"...during the year 1930-31, when a financial
crisis engulfed the world suddenly, prices for our
saltfish product during the early thirties and practically up to the beginning of
World War II, had
reached the lowest figure in history." I consider
this part of the report incomplete, for it offers no
explanation why the price was down, other than
in a general sense. That reason can be clearly and
unmistakenly defined and here it is. We were
selling our fish in sterling and converting to
Canadian dollars — a condition much as exists
today existed on the money markets. The value
of the pound was down in its relation to the
Canadian dollar. And the value of the Canadian
dollar was down in its relation to the American
dollar. This caused the fishermen to suffer a loss
of 20% on the value of fish. In other words, by
way of example, $10 of fish was sold for $8.
Moreover, this $8 was in some cases spent in
buying American clothing, footwear, etc. There
we had to pay a tithe of $ 1.22 Canadian funds for
American funds. Converted into American dollars then, the price of $10 fish is reduced
to
slightly more than $6.50. If we had had our
currency tied to the pound sterling the fishermen
could have received the full $10 value for thier
fish.... This condition is due entirely to the fact
that we use Canadian currency in Newfoundland
— or until such time as Canada buys all our
codfish and pays for them in dollars. What are the
possibilities of this happening? I am extremely
fair when I say I see no possibility of it happening. Something that reduces the price
of fish from
$10 down $6.56 is a great big enemy of ours and
should be removed. I do not propose to go any
further here on this subject. To continue with the
sections of their report on fisheries. It was during
this period that modern methods in handling,
curing and marketing of both fresh, frozen and
salt codfish were begun by the establishment in
various sections of the country of bait depots and
cold storage plants, financed in many cases by
our own government. I'm urged here to give the
figures for the amount of bait that was used
1933-1947: 1933, 1.8 million pounds; 1945, 6
million pounds. As a result our people became
confident of thier capability to secure paying
voyages in fresh, frozen or salted fish. It is not
unreasonable then to draw this conclusion (page
31): "And it is not unreasonable to say that the
adoption of methods that have brought prosperity
to such a country as Iceland cannot fail but bring
similar results to 30,000 of our people engaged
in the fishing industry of Newfoundland."
And so, as a member who had nothing to do
November 1947 NATIONAL CONVENTION 733
with the compilation of the Economic Report and
having giving it due perusal, it wins my unqualified praise. It was indeed a colossal
undertaking.... All over it shows reference to previous
reports that were approved in this House as
authority for its statements. In essence then, it is
a summing up of our work which was approved
and thus in its collective stage must win our
accord if we are to be consistent. Criticism of
course can be worthwhile, but to be worthwhile
it must be sound, practical and fair. It can be
perverted, fanatical even, when dealing with a
question so important, so all important as this
present one. In some instances our standard of
criticism has not been hard. And one tends to
disregard these, for we are here for constructive
purposes, not destructive. In the argument set
forth there are some points which we seem to
accept in our financial and economic set-up as
being unavoidable and insurmountable. I feel it
is unfortunate that these points should go unquestioned.... For instance, it is said
in a manner
foreboding ill, ours is an export economy, Newfoundland must export to live. I say,
what is
wrong about that? Let me repeat briefly these
established facts about our natural resources and
production. It has been proven to the satisfaction
of the most critical, and it is thus no longer
questioned, that our fish, ore, and paper industries
are of the greatest potential value, are very substantial in quantity and are being
soundly and
progressively administered. Demand in the
foreseeable future is excellent for these products.
Our equipment, wherewith we produce, has been
greatly improved and enlarged during the war
period and is now at a high point of efficiency.
From this we could almost deduce certain issues.
We could say that our production will be up and
that our sales will be up. Consequently we shall
go on living, go on exporting, but dark and
sinister forebodings cannot easily be dispersed
from the minds of those who would cherish them.
And so a new insurmountable obstacle is introduced and in the calm air of "I told
you so", they
sit back to await the realisation of their horrors. I
must pause here, Mr. Chairman, to say that a
nation or a country so disposed, so devoid of all
initiative and aggressiveness can only sink, sink
to the low level of a kept people. Great God, what
an answer. I feel, Mr. Chairman, that it is another
type of people whose interest we serve here
today, that they are not lowlife vermin-infested
individuals some would lead us to believe, but
Newfoundlanders in the true sense of the word.
If I thought otherwise I would not be here. But to
go on. This new obstacle in our path to prosperity
and self-support, in high sounding phraseology,
is termed the vulnerability of our economy due to
currency fluctuations. Yes, we are subject to just
that. I admit it. But I cannot accept it as being
insurmountable. True, we have in the past never
tried to correct this situation. We have never
fought back, we have never tried to forewarn
ourselves and thereby forearm ourselves against
these fluctuating currencies — mainly, I say,
because we were in no position to do so. I grant
exception to this in one instance only, and I refer
now to the effort of the present government in
correcting to our advantage the situation which
arose this year when Great Britain decided to
suspend sterling conversion. Just so many years
ago this would have been impossible and beyond
our ability to correct. Today it appears in the light
of ordinary business, nothing at all exceptional
about it, just plain ordinary business — so ordinary, that similar methods could be
adopted, and
I believe to some extent were, by the business
houses, they having the added advantage of being
able to purchase English goods with sterling
funds. I mention this but briefly in passing, because I feel that by next year Britain
will have
regained her position in the export trade. Latest
reports show her production to be increasing
favourably. Added to this, there is a greater
awareness in Canada and other countries of the
necessity, for their own preservation, to increase
their purchases from her, and that well describes
our position too.
One point relative to this subject warrants
further comment and better understanding, and
that is that when the government agreed to convert the sterling, no guarantee of the
value the
pound was made. At that time conversion was
being negotiated on the basis of $4.03 for each
pound sterling. It now appears that dollars will be
made available only after sterling credits have
been set up. This means that should the pound be
further depreciated and is pegged at this artificial
price, and subject to the whims of world financiers, then the fisherman or the exporter
would
get proportionately less for his fish. It would
appear that conversion of the estimated dollar
734 NATIONAL CONVENTION November 1947
requirements should have been guaranteed at
$4.03. There's where the government broke faith
with our people, for this and only this could have
stabilised the price of codfish for 1947. And that,
Mr. Chairman, is what I mean when I say we do
not fight back. Further, no loss to our treasury
need be incurred as it is unquestionable that the
pound will recover given time, and we having no
immediate need for our surplus, could await that
time. Just such a transaction suggests the
feasibility of holding some of our surplus in
pounds sterling — an amount say equivalent to
the interest-free loan, though not with the Crown
Agents but in a special trading fund. It emphasises the selection of business where
and
when it best serves our country. In other words
our purchases should get channelled in the direction where they are best calculated
to stabilise our
economy. Can we do this? Most certainly we
can.... I am urged to suggest what machinery of
government would be necessary to affect this. As
I see it an actively functioning department of
supply and a foreign exchange advisory board
would be sufficient. We are years behind in attending to these matters. If we are
to protect the
fishermen's catch of 1948 as well as our other
exports to sterling purchasers, it is essential that
we act along these lines immediately. No one
need get hurt. In fact, it would be good for all.
But presently, a line of low grade commodities is saturating our
shelves. Where it isn't low grade it is high grade,
too high for the economy of our people. Our people
have been on a spending spree. Some confuse that with
a standard of living. The profits have
been eagerly garnered, and I have good reason to
believe are being smuggled out of this country to go
on deposit in United States and Canadian banks.
How then, unless this is stopped, can we have our
local investments made and our local industrial
life developed? This is not an anticonfederate
argument. The question of government is far from
my mind. It is my suggestion, Mr. Chairman, of possible methods of dealing with a
situation which makes our economy
vulnerable. I say this, because our trade with Canada
has been, is, and will continue to be the greatest of
all deterrents to Newfoundland's progress.
It has been so under past and present governments, it
can be only increased if by chance we subjugate
ourselves as a province of the
Canadian government.
Mr. Smallwood Mr. Chairman, a point
of order. Mr. Miller says what is going to happen if
we should subjugate ourselves as a province a
Canada. Is that in order in this debate on
economic affairs? Is that in order, sir?.... Isn't
that a discussion of confederation? Hadn't that
better wait until we debate confederation?
Mr. Miller I just mean in relation to
policy. It is policy.
Mr. Chairman It is a question of
propriety. Please don't bring it in.
Mr. Miller Am I allowed to draw
comparisons again, Mr. Chairman?
Mr. Chairman Speak on the economic facts and you can't go
wrong.
Mr. Chairman No. If you don't mind,
Mr. Hollett, I have a ruling. It isn't a
matter for comment at all. He won't discuss
Australia or America or anything else, save insofar
as the economy of the particular country referred to
has a bearing upon the productive economy of this
country. We are discussing the Economic Report.
Mr. Smallwood Point of order, Mr. Chairman. Mr. Hollett is
not on a point of order, he is making a speech about
your ruling. My point of order is, is he permitted to
do that?
Mr. Chairman I have given my ruling
and I wish members would do either one thing or the
other, that is all I can say. I don't want.... I beg
your pardon?
Mr. Chairman No, you were simply
commenting as I see it, Mr.
Hollett.
Mr. Smallwood Mr. Chairman, I asked
for a ruling to a point of order. I ask now for a
ruling as to whether Mr. Hollett is permitted to
discuss your ruling on my other point of order.
Mr. Chairman Let me hear what Mr.
Hollett has to say first....
Mr. Hollett Don't jump down
somebody's throat as soon as they get up.
November 1947 NATIONAL CONVENTION 735
Mr. Hollett True, you're small enough
to crawl down a man's throat!
Mr. Hollett You made a ruling and I
respect it. It's perfectly right, probably, but I
wanted to ask you this question in case I did get up
at some other time on the Economic Report. If I'm
talking about the economy of this country, have I
not the right to compare certain aspects of the
economy of this country with any other country in
this world?
Mr. Hollett Well, I won't say more.
Thank you very much.
Mr. Chairman Except, Mr, Hollett,
except you must not get off the Economic Report to
make any reference to political institutions as such
at this time.
Mr. Miller If I were humoured, sir, I
would say...
Mr. Chairman I am not interested in
the expression of senses of humour, I am
merely interested in getting on with the business of
the House. Please continue.
Mr. Miller Yes, sir. Suppose we take a look at what Canada
is doing under very similar circumstances.
Canada, too, is an exporting country. In fact she is
referred to as great exporting country. Turning our
eyes to Great Britain, she too found it difficult to
market her produce due to the limited dollar credit
available to the old country. And if the people of
Britain had decided to tighten their belts another
hitch, which incidentally they do
willingly in their country's interest, then we'd be
buying Canadian bacon in Newfoundland at a
very low figure. However, Britain continued its
collective purchasing and relied on currency control
to reinstate her position, and Canada realising this
decided there and then to reduce, curtail to the
very skeleton of its agreement its trade
with the United States of America, and increase its
trade with Britain. This was done of necessity to
protect Canadian exports to Great Britain which
amounted in the first half of the present year to
$352 million. What the loss of this market would
have meant to the Canadian farmer can be best
appreciated by the Newfoundland fisherman when he
remembers the uneasy time he has just passed
through. True, Canada continued unchecked
its purchase of essentials such
as coal, oil and cotton, using US dollars from its
tourist traffic — US dollars that Britain has been
spending in Canada, and resorting as well to the
sale of its gold to the US Federal Reserve Bank.
All this it is feared is not enough to offset the
unfavourable balance of trade, and rumour now
has it that Canada will seek a loan of $500 million
American. Yet Canada is considered a self—supporting country. All this gives little
credence to Canada's economic nationhood. And I'm
glad, Mr. Chairman, that we too assist Canada in no
little way through the US dollars received for our
exports to that country, and by the receipts in
Canadian banks in Newfoundland of US dollars.
On that sir, I am going to again refer to my old
friend, Chadwick and Jones, section 39.
Newfoundland's balance of payments position cannot be determined with the available
statistical material. The net balance of trade was
positive throughout the thirties but the gains from
the visible trade were more than offset by invisible imports. During the war the balance
of
trade became negative and the negative balance
on invisibles increased because of higher costs
and mounting net insurance remittances. Exchange losses are, however, borne by Canada
since the Canadian dollar is legal tender in Newfoundland and all banking transactions
are carried on by Canadian banks. Any losses on
Newfoundland trading account were probably
more than balanced by the earnings from the
purchase of Canadian dollars by United States
forces which for the four years ending 1945
amounted to $77 million US. This money should
directly be held in Newfoundland as Newfoundland credits for our essential purchases
in
American markets. We have to buy US dollars at
a premium and thereby further impoverish our
economy. So as we consider the stability of our
own economy, we would be well advised to view
the clouds on the economic horizons of other
countries
What does all this add up to? Presently, a
mess. Is the world full of insurmountable
obstacles? Not at all, but to go forward we must
act with initiative and aggressiveness.... We must
shake off some misconceptions of our forefathers. We are doing it, let us pick up
speed. It
has been said that the outline of Newfoundland's
economy lies in the shadow of the economy of
other countries. I say it has been held there, and
736 NATIONAL CONVENTION November 1947
I further say that like a plant held in the dark once
submitted to sunshine, it will grow, develop and
be firm. Can we do this? Again the answer is yes,
but first we must have representation, Newfoundland representation. Now don't jump
up,
Mr. Smallwood, I am not talking about political
representation. Newfoundland representation in
the world programme. Turning again to the picture of world trade relationships, whilst
we are
not a contributor to the political influences which
determine the shape of things to come and the
stabilisation of western Europe, there is every
reason to believe that we will have a strong,
favourable reaction in our fish markets. How
will all this be removed from the scheme of things
which in years gone by prevented us from selling
our produce because trade sanctions were being
enforced against our customers? The effect of
these sanctions is shown in the Chadwick-Jones
Report, Mr. Chairman, on page 23, and I quote,
"Sanctions against Italy and civil war in Spain
threatened to eliminate two of the most important
European markets, and the value of exports of
dried cod to European countries fell from
$3,400,000 in the financial year 1934-35 to under
$1,520,000 in 1937-38." Sanctions, Newfoundland backing up sanctions, poor crippled
Newfoundland backing up sanctions for the
British Empire.
[1]
The programme for Europe envisions the
removal of all trade barriers. I do not wish, sir, to
labour this point, the programme for Europe envisions the removal of all trade barriers
— and
while I have not wished to labour this point, I
hoped to express the importance to our economy
of our external relationship, as well as an appreciation of the now apparent fact
that an effort
is about to be made to assist the countries of
western Europe. A substantial proof that they will
stand together in peace as in war is now evident,
equally evident is their need to do so against the
progressive assaults of communism; for once the
world is divided into two camps of such dissimilar thinking, military and naval tension
will
not ease. And so we with our bases remain target
no. 1 on the Atlantic seaboard. This is not a
position to be coveted, but it is a part of our future
whether we like it or not....
Perhaps as we speak here we do so as the last
body of Newfoundlanders elected for a national
purpose. Let it not be said of us that we did not
protest the injustices committed against our
country by the impairment of our economy.
Sometimes I think we accepted too quietly the
restrictions enforced on us by Commission of
Government in preventing us from talking trade
relationships and similar matters with the USA.
In any other country such muzzling could have
but one reaction, for how closely trade is interlocked with economy has been amply
shown in
the Economic Report. How different this report
could have been if the Committee had been permitted to interview the American government
on
the aforementioned subjects. Evident now is their
great handicap in forecasting the foreseeable future in a comprehensive manner by
not knowing
the condition and disposition of those with whom
we do business....
And so the final report of the National Convention has been submitted, and I approach
the
climax of my responsibility when I say I
corroborate it. From now on the responsibility
slowly shifts to the people, and we will be left to
justify our recommendations in our own hearts.
That our conclusions will be based on actions
governed by neither fear, favour nor prejudice
will be our consolation, whatever the eventual
result. That the road ahead will have its ups and
downs, in this country as in other countries, one
cannot dispute. Such are the realities of this earth
and one would be a fool to disregard them. One
would be a greater fool not to use all means to
guard against them. Our economy is sound. Our
future can be but the result of the actions of our
people. That their actions will be governed by
neither fear, favour nor prejudice, I am happy to
think.
[The committee rose and reported progress. Mr.
Smallwood and Mr. Higgins moved that various
motions be deferred]
Mr. Higgins I move that the
Convention hold night sessions on every day that a
day session of the Convention is held.
Mr. Chairman Since you gave notice of
this motion, the possibilities of giving effect to
your motion have been explored I have to report it
is not, for two important reasons, possible to hold
night sessions other than on Mondays, Tuesdays
and Thursdays. If it is decided to give full effect
November 1947 NATIONAL CONVENTION 737
to the motion, the possibilities
are we will find ourselves within the next two weeks
without any reporters at all.... Therefore I would
accept an amendment to that effect.
Mr. Job I move an amendment that the
Convention hold night sessions on
every Monday, Tuesday and Thursday of each
week instead of every night.
I would like to add to the Chairman's remarks
that, in consultation with our very efficient
reporters, they very clearly stated it was not possible to report on every night.
This is a compromise to meet the situation, and I believe it is
very desirable.... I think that broadcasting can be
done, even if it is a little delayed.
Mr. Chairman They will be recorded
but the broadcasting must of necessity be a little
behind.
Mr. Hickman I am glad this amendment was made. I felt that
six nights a week would not be suitable to all
members. I have much pleasure in seconding the
amendment. I feel we cannot get through this any too
soon....
Mr. Chairman There seems to be some
misapprehension that perhaps
members of the Convention are not trying
to push the work of the Convention as fast as people
think it ought to be done. That is not so. It was
not possible before now to have evening sessions....
I do not want the position of the Convention to be
misconstrued. We have gone into the matter and after
investigation — we have to consider
reporting and broadcasting — we find it is
not possible to hold more than three night sessions
per week....
Mr. Smallwood On the question of
meeting at night time. I would like to say this.
There may be in this Convention delegates who enjoy
more than I do, being in here. I have yet to meet
them. I enjoy being here as much as anyone. I love
every moment of it, I hate to think of its closing.
That is frank and it is sincere. Because, in my
view, the people of Newfoundland are getting an
education in the affairs of the country that they
have never gotten in the history of the country
since 1497. I love the thought of the people
finding out for the first time something of what is
going on in their country. As far as I am concerned, I would like Mr. Higgins'
motion to carry — to meet every night. Not only
every night, but every day but Sunday. There cannot
be too much of a good thing.
There is another matter. If this Convention is
going to close around the middle of December...
that leaves one month between the end of this
debate and the closing of the Convention. During
that month we have two orders of business to deal
with: the question of confederation, and the question of the forms of possible future
government
that we will recommend to His Majesty's
Government in the United Kingdom to be laid
before the people in the national referendum. A
month in which to do that! As far as I am concerned ... there should be a thorough
debate on
the terms of confederation, and that debate should
be known and heard by all the people of Newfoundland. To the extent that the holding
of night
sessions might prevent the people from hearing
the debates, I would not advise holding night
sessions. If the night sessions are not to be broadcast, it means the people are hearing
only half the
debate, and that might be a half when some
essential matters are debated. I would like to be
satisfied that debates held at night time are broadcast.
I do not feel like making an amendment to the
amendment; possibly it might be agreeable to
add, "but that no night session shall continue
beyond eleven o'clock on any night".... I would
suggest that amendment to Mr. Job. Could that
be done, with the understanding that the debates
be broadcast so that the Newfoundland people
will know what is going on?
Mr. Chairman I cannot give you any
undertaking that the evening
sessions or any of them will be broadcast. All I can
tell you is that Mr. Ryan, our Assistant Secretary,
has contacted the Broadcasting Corporation
and has been advised that they are very
sympathetic.... I am advised that the facilities of
the Broadcasting Corporation, insofar as
human endeavour will permit, will be placed at the
disposal of the Convention. It depends upon the
outcome of the motion.
Mr. Smallwood I do not anticipate any
violent opposition to any of the motions. Would the
mover be willing to let it stand over until Monday
so that the Broadcasting Corporation can be approached with this request — in case
we
had sessions three nights a week, could they
undertake to broadcast on these
three nights?
Mr. Chairman This motion has been
brought about by the fact that the members of this
Convention and myself have been
criticised for not proceeding as thoroughly and as
exhaustively as
738 NATIONAL CONVENTION November 1947
we might have in
this work. That is a criticism that the public is
entitled to make. It is a criticism we must take
cognisance of. I feel that the feeling is so strong,
the work ought to be speeded up and I think this
motion should be disposed of one way or another at
this time.
Mr. Job I have no objection to the
sessions ceasing at 11 o'clock, I am convinced that
the broadcasting will be done, but not the same day.
Mr. Smallwood I have made my point. I
am quite sure the broadcasting people will have
heard the point and they appreciate the profound
interest of the people. I feel they will do everything in their power to see that
the
people of Newfoundland hear every word said.
[The motion as amended was carried. The Convention adjourned]
