Mr. Cashin When the committee rose yesterday
afternoon, I was addressing the Convention on
the issue of confederation. This afternoon, whilst
it would be my privilege, according to what has
been going on here lately, to give some "tedious
repetition", as it would be termed, it is not my
purpose to do so.
When I took my seat yesterday I was discussing the Marshall Plan and how it would
affect
Canada. I pointed out that Canada is longing for
this Marshall Plan to go through in order that she
may get some very badly needed American dollars. For this reason, if this plan goes
through it
will involve an expenditure of $7 billion a year,
a lot of purchases for which might be made in
Canada, and consequently will give Canada considerable American funds which she now
needs
so badly. I intend to go on from that part of my
talk.
Let us take another look at these proposals.
Annex IV in the Grey Book
[1] tells us that the total
revenue which Canada will expect to obtain from
Newfoundland, if we become a province, is
slightly over $20 million annually. These figures
may be just guesses, otherwise they are
fraudulent and dishonest.
Mr. Smallwood Point of order. Major Cashin is
now attributing very dishonorable motives, to say
the least, to the Government of Canada. A former
Chairman, Judge Fox, ruled that it is not competent for members of the Convention
to refer in
disrespect or in terms of that type to His
Majesty's Government in Canada.
Mr. Chairman It does not follow that if the
figures are incorrect they are fraudulent. I am not
listening to charges of fraud.
Mr. Cashin These figures were handed by the
Canadian experts to the Newfoundland delegation to take home. They are not worth the
paper
they are written on. Mr. Smallwood never questioned the figures. Why? Because it was
part of
his game.
Mr. Smallwood Point of order. Is it correct for
Mr. Cashin to be imputing dishonest motives to
me?
Mr. Smallwood He has done so and was not
called to order. Must I rise in my own defense?
Mr. Chairman You must. It will be thought I
have some ulterior motive in intervening when it
is not justified.
Mr. Smallwood Unless I rise and claim protection of the Chair, I am not to have it?
Mr. Chairman Unless there are questions of
grave disorder, I am not bound to intervene. I
must ask you, Major Cashin, not to impute
dishonesty.
Mr. Smallwood I am anxious to sit here and
listen as long as he does not make charges of that
kind. If he wants to make the same charges again,
I will not stand for it.
Mr. Chairman That fact that you believe the
figures are incorrect, Major Cashin, does not lay
any foundation for your making an allegation of
fraud.
Mr. Cashin When I presented the Economic
Report, I never interrupted Mr. Smallwood. I let
him go to town on it. He does not like some of his
own medicine.
These figures, of course, are not ours. They
were handed by the Canadian experts to the Newfoundland delegation to take home. And
the Ottawa delegation apparently took these figures
without even asking a word of explanation; never
questioned them. They have no explanation to
offer. I want to compliment Mr. Fogwill on the
effort he made in dissecting these figures. I know,
as a former minister of finance, what he was up
against. He had to go through that Blue Book and
he had to go through it from cover to cover, trying
to prove his figures. We have no proof here. No
Canadian representative has been brought to this
house. Mr. Smallwood has been acting on behalf
of the Canadian government.
Mr. Smallwood I rise to a point of order. I was
appointed by you, Mr. Chairman, to pilot this
report through the House. I have been acting on
behalf of this House. Am I to be charged with
acting on behalf of the Canadian government?
Mr. Chairman You are going too far, Major
January 1948 NATIONAL CONVENTION 1063
Cashin. As an appointee of the Chair, it does not
follow that he is the agent of the Canadian
government.
Mr. Cashin These figures were handed by the
Canadian experts to the Newfoundland delegation to take home; and the Ottawa delegation
took
these figures without even asking a word of explanation. Mr. Smallwood eulogised these
Canadian experts as individuals who knew more
about our country than we do ourselves. We are
sick and tired, Mr. Chairman, of hearing about
experts in this country. Nicholas Murray Butler,
the late President of Columbia University in New
York gives the definition of an expert as follows:
"An individual who knows more and more about
less and less."
Anyhow, let us see how these estimates from
these Canadian experts stand up against the hard
facts. Today we are collecting $10.5 million annually in personal income tax, corporation
tax,
and death duties (or, as they call it in Canada.
"succession duties"). The Canadians say that
under confederation they expect to collect from
these sources about $11 million annually. Now,
I ask, is this reasonable? Is this an accurate estimate in view of the actual position?
The first
point is that, under confederation, this particular
field of taxation would be far larger than it is now.
Also, the Canadian rate of taxation would be
higher. Just consider, for instance, the matter of
Newfoundland income tax. With us, this tax applies to single persons earning over
$1,000 yearly. But in Canada it takes in everyone who is
single and not married, earning over $750 yearly.
In Newfoundland a married man does not pay
income tax on earnings up to $2,000 yearly. In
Canada, it takes in persons earning over $1,500
annually. The ordinary clerk on Water Street
earning $1,000 a year if he is a single man, or if
he is a married man and earning $1,500, under
the income tax law he is not allowed to put in his
own income tax; the Canadian government does
not trust the employee; it is deducted off his
salary each month. In Canada today there is $80-
odd million in refunds to be made, some of them
to persons who are dead and buried and I hope
are in heaven, and to whom the income tax
refunds are no good. These were taken by the
Canadian government and used during the past
seven or eight years.
Will not then this increase in the income tax
brackets place hundreds, and possibly thousands
of Newfoundlanders under taxation who are now
free? This means that under Canadian income tax
laws, all fishermen, loggers, farmers, miners,
longshoremen, labourers, stenographers, nurses
and clerks who are single and earn over $750
annually will be subject to income tax, and will
not this increase the amount of taxes collected?
The same applies to married people earning over
$1,500 yearly. And does it not indicate that when
these Canadian experts say that they expect to
collect only $3.2 million from personal income
tax annually, that the rest of it is incorrect? I asked
about that the other day and the answer they gave
me was evasive. They told me, in so many words,
to read the Grey Book and I would get the information, as if I had not read it. The
most insulting
document that ever entered the doors of this
assembly. Mr. Chairman, I say they will collect
not less than $4 million annually or nearly $1
million in excess of the figure they give. And the
same thing applies to corporation tax and succession duties, they will also be higher
than the
misleading figures given us. And there is another
feature. With us, no death duties attach to life
insurance policies made payable to beneficiaries.
But this is not so in Canada. If we enter confederation we will have to pay death
duties or succession duties on these policies. And we were told
we were not going to have any new taxes! And
as we know, in this country there are some
hundreds of thousands of dollars paid beneficiaries annually by Canadian life insurance
companies. Here again we have an instance
where, under confederation, new taxes would be
imposed on Newfoundlanders, and consequently
we have another source whereby the taxation
payable to Canada would be increased. Mr. Fogwill made a breakdown of these taxes.
The experts did not come down here and tell us all about
these taxes, neither did they give the Ottawa
delegation any information.
Mr. Smallwood said that there will be much
duty free goods coming in here and that will
decrease revenues correspondingly. I want to say
that all kinds of goods are coming in here today
and those goods originate in the United States —
take cotton goods, steel products, Canada has to
pay duty on them entering Canada. Did these
experts take the invoices in the Customs? Did
they get the points of origin of things? Certainly
1064 NATIONAL CONVENTION January 1948
not. They took the Blue Book and they guessed
at them. Furthermore, are we to take it that because Mr. Smallwood says so, that we
will be
importing our goods from Canada? Will we not
be permitted to buy anywhere else? Why, last
year, we imported $25 million worth of goods
from the United States on which duties of not less
than $3 million were paid — I am estimating that.
I say they probably collected nearly $4 million;
and those so-called experts say we will get $2
million. And again on flour; we are told we will
get it in duty free from Canada. That reminds me,
in connection with flour coming into the country,
the Canadians are tipping Newfoundlanders with
the flour, because they are selling wheat in Great
Britain for $1.50 a bushel, market price, and it is
$3 a bushel in Newfoundland. We in Newfoundland have been paying on wheat based at
$3 a bushel; while in Great Britain they are
paying on wheat based on $1.50 a bushel.
They say they will collect $400,000 in liquor
taxes. If you can tell me they were not guessing,
I will eat my hat. In 1946-47 we collected over
$1.5 million in taxes on liquor. I am glad I am
talking on this liquor business. In Canada, they
can never unload the Scotch manufactured in
Canada on the Canadian people. The distillers,
like Seagrams, have to pay $12 a gallon in the
form of excise duties to the federal government.
It is coming here duty free, but they forgot to put
in the $12 a gallon they collect there. It was
deliberately done or else they are not experts. The
same thing applies to mm which they import
from the West Indies; the duty is much higher
than it is here at the present time. And again on
cigarettes — take Lucky Strikes; they are 52
cents to 55 cents in Canada. You do not hear them
telling us that. Under confederation we will
probably pay 20% or 25% more than we pay now.
I have a package I bought here for 37 cents; I
bought them in Montreal the other day for 44
cents.
Prior to that I referred to the significant fact
that the gentleman who is now High Commissioner in Ottawa for the United Kingdom played
a prominent part in the compilation of the infamous Amulree Report; I gave his name,
Sir
Alexander Peter Clutterbuck. I understand that
during our recess — I was out of the country —
Commissioners went on the air and advised the
people to vote in the referendum; they advised
them on many things, but neither one of them told
the people of Newfoundland what they were
parties to and are continuing to be parties to, that
is the violation of the 1933 agreement. They are
more concerned — some of them — with referring to the morals in St. John's East and
St. John's
West; whilst these violations are offences, they
themselves violated the very statutes under
which they exist.
Now, Mr. Chairman, I think I have shown
conclusively that based on our present financial
and economic position, if Newfoundland entered
into confederation Canada would stand to gain
many billions of dollars annually over and above
the subsidies paid to this Country.
Let us for a moment refer to Annex IV of the
Grey Book which gives the possible expenditures
of the federal government annually in
Newfoundland. Great stress has been made by
Mr. Smallwood on the importance of the payment of family allowances which are estimated
to amount to $8.35 million yearly. I refer now to
what is generally called the "baby bonus". To get
to the root of this matter, it is necessary to give a
somewhat brief history of how it was brought
about in the Dominion of Canada. I go so far now,
Mr. Chairman, as to term this piece of Canadian
legislation the most immoral and corrupt enactment that has ever stained the pages
of the
statutes of Canada.
In 1944 the Mackenzie King government was
on the verge of total collapse, because efforts
were being made by many of its outstanding
members to bring about conscription into the
armed forces of Canada for the purpose of reinforcing the Canadian army.... Prime
Minister
King — who has always depended for his political support and his retention of the
government
on the political backing of the French province of
Quebec — was trying to dodge the conscription
issue. He compromised, so to speak, with the
French element in his party, putting through the
conscription legislation; but on the other hand, in
order to placate his followers and the people of
the Province of Quebec he introduced this Family
Allowances Act, which is the "baby bonus" legislation. This particular legislation
was introduced
principally forthe purpose of healing the political
sore which was created in the French Province of
Quebec by the passing of the Conscription Act,
which compelled the French Canadians to join
January 1948 NATIONAL CONVENTION 1065
the various armed forces of Canada — it being a
well-known fact that the people of French
Canada were not enthusiastic to take part in any
wars that did not involve their homeland directly.
Mind you, there were several outstanding French
Canadian regiments, but it is generally speaking
I am talking about. The same thing applied to the
First World War. This corrupt legislation has cost
the Canadian nation and the Canadian taxpayers
over $200 million annually. The same immoral
legislation is now being held out as a bait to the
people of Newfoundland to induce them to join
the federal union; but I would like to point out
that there is no definite indication that this particular legislation will be continued.
As a matter
of fact, there are thousands of Canadian citizens
throughout the entire Dominion of Canada who
are advocating its repeal. And in view of the fact
that Canada is today in a difficult financial position, having to impose further taxation
on its
already over-taxed people, it is not unlikely that
this legislation will be stricken from the statutes
within a very short period.
Mr. Cashin It is not nonsense. If that is all you
have to offer, it ought to be thrown out through
the window. Go into the Province of Ontario and
see what you will find. Everyone who knows
anything about the legislation, knows they are
only doing it for political purposes. Prime Minister King had to do that, otherwise
he would have
had to resign. And incidentally, he was defeated
in his own constituency of Prince Albert.
This particular feature of the proposals for the
union of Newfoundland with Canada is being
stressed with every effort by the advocates of
confederation. They feel that it is the one bright
spot in their annexation platform. They realise
that the other terms of union have no basic or
solid foundation, and at every opportunity that is
afforded them, they try to drill into the minds of
our people that once they become a province of
Canada all our difficulties will be ended, and the
Newfoundland people will at last have entered
into a land of milk and honey. They conveniently
forget that the taxpayers of the country will be
compelled to find these fictitious monies through
either direct or indirect taxation. One would imagine to hear some of these people
talk, that
money is growing on trees. They deliberately try
to avoid discussing the present average tax of
Canada as compared with the average tax of
Newfoundland, which as I have already said, is
favourable to Newfoundland in the amount of
$110 per head for every man, woman and child
in the country. Let me repeat and further emphasise the fact that union with Canada
means
extra taxation on our people of an additional $35
million annually.
Now let us make a brief review of the Old Age
Pension Act as it exists and functions in Canada.
A man or woman, to become eligible for this
stipend, must be practically a pauper, and then
before he or she receives this $30 per month
allowance, he or she must assign to the federal
government any property or assets they may
have; which in the event of death is taken over by
the Canadian government and sold in order to
repay the federal treasury the amount so paid.
Mr. Cashin You will have plenty of opportunity
to reply to me later. We can get the act. The
people of Canada are raising Cain over the means
test. It is wrong to give a man an old age pension
if when he dies the government takes his estate,
unless he violates a law and has it made over to
his successor some years before. It is an inducement to law-breaking. In our Economic
Report
we outlined a plan whereby we would be in a
position to supplement our present old age pensions scheme to bring the stipend up
to $25 per
month. But never in the history of our country,
since the old age pension was first instituted some
40 years ago, has the pensioner been compelled
to assign or mortgage his properties or assets to
the government in order to become eligible for
this pension.
Also, with respect to the unemployment insurance scheme now in force in Canada, it
is
proper that our people should know that those
affected or those eligible for recompense under
this particular plan, in the event of union with
Canada, would not be our primary producers. It
does not affect our fishermen, our loggers, our
miners, our farmers, our longshoremen or others
of the labouring class, and consequently would
be of little help to the employed of Newfoundland.
If we refer now to the probable expenditures
under Annex IV, we find that the sum of $9.4
million is set down to be spent by the federal
government annually in what they term "Other
1066 NATIONAL CONVENTION January 1948
Department Expenditures". It took a question
from Mr. Hollett to get some information on it. I
have not seen the answer. Here is the position I
take: the members of the Ottawa delegation
looked at this $9 million, surely they should have
asked about it. They took what they gave them
and brought it home. That is the way it appears.
We have asked the Ottawa delegation to give us
some idea of what these expenditures would be,
and through what particular channels the monies
will be disbursed, but they have failed to give us
any concrete answer. They do not know definitely and can only surmise. Again I am
forced to
point out that nearly all the estimates contained
in these Canadian proposals, given us through the
efforts of the Ottawa delegation on behalf of the
Commission government, are absolutely fictitious and most unreliable. They are based
on
nothing concrete. The Ottawa delegation,
through Mr. Smallwood, has admitted to this
Convention that these estimates of both revenues
and expenditures contained in the Grey Book
were prepared by the federal government of
Canada months before the Newfoundland
delegation went to Canada.
Mr. Cashin You told us that in the Steering
Committee. Mr, Higgins, Mr. Hollett and Mr.
Hickman were there and they know I am telling
the truth. We will have a showdown on this.
Mr. Chairman I do recall a statement that
something was prepared; but frankly, honestly, I
do not recall at what period it was prepared.
Mr. Cashin It is too bad we do not keep minutes
of those Steering Committee meetings.
Mr. Smallwood Let me first say that I said at the
Steering Committee that the bulk of the material
given to us by the Canadians was prepared long
before we arrived. The first public meeting was
held that afternoon. They presented us with two
volumes of black books; not these Black Books.
Mr. Smallwood That is smart. You do not want
the solid truth. You want to get off a few gags. I
am not dumb.
Mr. Cashin You are not dumb — you occupied
70% of the time in this Convention, talking for
the last 16 months. I wonder, Mr. Chairman, on
what authority or on what basis were these
figures prepared by the Ottawa experts. Who
asked the Canadian government to have these
estimates prepared? On what supposition did the
Canadian government anticipate a delegation
from this Convention? When Mr. Smallwood
went to Ottawa shortly after the Convention election in July, 1946, did he inform
the Canadian
government that such a delegation would be
forthcoming and did he request the Ottawa experts to prepare these estimates at that
time? Is it
not conclusive proof, Mr. Chairman, that this
whole confederation idea had been planned long
before this Convention met here over 16 months
ago? Is it not just a further confirmation of the
facts of history, that it has been the policy of the
imperial government for nearly 80 years to force
Newfoundland into confederation? Is it not
definite proof of this whole scandalous transaction, and that the Commission government,
who
are the local agents in Newfoundland for the
British government, are aiding and abetting the
present move? Let me repeat what I have frequently stated before: that if this is
not the case,
why has not the United Kingdom government
carried out its solemn agreement made with the
Newfoundland government in 1933? Lord Addison refused to tell us when he was confronted
with this matter in London last May. Is it a case
of the British government treating its sacred
pledges to one of her own dominions as just
merely another scrap of paper? If that is not so,
then will someone tell me why this particular
agreement has not been carried out? I appeal to
His Excellency the Governor to come out and tell
the people of Newfoundland why His Majesty's
Government in the United Kingdom has failed to
keep its promise to the Newfoundland people. In
that agreement there was no mention made of
confederation with Canada, conventions or plebiscites. The people of this country
are entitled to
know the truth in this respect and I know of no
other person in the country today more capable
of telling them the truth than His Majesty's representative. The time has arrived,
Mr. Chairman,
when all cards should be laid on the table and this
trifling with the people and their rights should
cease immediately.
There are niggers in the woodpile somewhere,
Mr. Chairman, and I think that after 16 months
existence of this National Convention, the
delegates here today know that the niggers are the
United Kingdom government and the Canadian
January 1948 NATIONAL CONVENTION 1067
government. Mr. Chairman, if I were as ardent a
confederate as Mr. Smallwood, I would go out
and campaign vigorously for the carrying out of
the agreement of 1933, and then I would further
campaign this country in the interests of the
retention of Commission of Government. I would
do this because I feel sure that it is the policy of
the United Kingdom government, the historical
imperial policy, that Newfoundland must become a part of Canada. I would campaign,
if I
were Mr. Smallwood, for the retention of Commission government, because I would feel
confident that the Commission government, through
its bosses in Downing Street, would hand this
country over to Canada, lock, stock and barrel,
within six months after the referendum was
taken, should the people decide to continue under
commission form of government. I challenge any
member of the Commission government, and
particularly do I challenge the representative of
the United Kingdom government on that
Commission, to come out openly and honestly
and tell the people that their bosses in Downing
Street are not using their efforts to bring
Newfoundland into union with the Dominion of
Canada. If they deny that such is the case, then I
say to them, each and every member of the Commission government: tell us why you are
not
prepared to carry out your agreement with the
people of Newfoundland, and why you have been
spending and are continuing to spend the money
belonging to the people of Newfoundland like a
bunch of drunken sailors, which in my opinion is
being done for the sole purpose of trying to break
our country. Take up this morning's paper — the
revenue and expenditures are given — $31.6
million in revenue and practically the same in
expenditure for nine months; and an indication
given by the Commissioner of Finance, that we
are going to have a deficit this year on a $40
million revenue. What is that but deliberately
squandering the taxpayers' money, and it is being
done purposely.
I go further now and state, Mr. Chairman, that
the financial policy of the Commission government is more or less being run from Ottawa
at the
present time. We all know that because of the
financial difficulties of the Canadian nation, with
particular emphasis on its shortage of American
dollars, that an austerity program has been
launched in order to conserve United States dol
lars; that heavy increases in taxation have been
imposed; that Canadians travelling between
Canada and the United States are at present being
subjected by Canadian Customs officials to the
most undignified examination of their person and
their personal belongings, which treatment is also
being meted out to Newfoundland citizens
travelling between Canada and the Untied States
on their own business with their own money. This
policy is now being felt right here in our own
country, despite the fact that Newfoundland has
a favourable balance of trade with the United
States. Now here is the position. All the newsprint
is sold in American funds, plus all the ore from
Buchans. At least $40 million of American funds
coming out of Newfoundland, whereas we buy
very little, $20 million or $25 million from the
United States, therefore we have a credit which
Canada benefits from, and our people are being
subjected to undignified search in case they have
a $20 American bill stuck down in their sock or
anything like that. Their own money. An announcement has been made from Ottawa that
this
policy will be continued until 1950. Again with
respect to the controlling of our finances by
Canadian politicians, I would like to bring your
minds back to February, 1943, when the Commission government imposed the retroactive
income tax legislation. You yourself, Mr.
Chairman, as a member of the Newfoundland
Board of Trade, proposed a motion at a public
meeting of that body condemning such iniquitous
and dictatorial legislation. Let me tell you, sir,
and let me tell the people of Newfoundland, that
this particular legislation, what I would term immoral legislation, was enacted at
the instance of
the then Canadian finance minister, for the purpose of curbing inflation. The people
of Newfoundland, who include the businessmen as well
as the ordinary workers, were reaping rewards
which has been due them for over 80 years.
I have heard people saying that all our
prosperity was due to the war. Why 80 years ago
this base construction was recommended to the
British government, but it took them 80 years to
find out the importance of the country. Our
people had just emerged from untold suffering
and privation. Their every belonging had been
swept away during the depression of the 30s.
They had been forced to exist on six cents a day
for nearly ten years. The construction of
1068 NATIONAL CONVENTION January 1948
American bases in the country brought the first
real money we had seen for over ten years. They
were making efforts to rehabilitate themselves.
But the Canadian government, in order to bolster
up its own financial position, influenced the
Commission government to inaugurate this vicious and immoral legislation. Now again
the
story repeats itself, and we find the Canadian
government again financially embarrassed, and
they are compelled to stoop to a low level in order
to curb our disbursement of our own moneys. Let
me also remind you, Mr. Chairman, that just a
few months ago, the financial position of Canada
became so acute that she was forced to seek aid
from the American government. Yesterday, in
answer to a question which I placed I received an
answer, or the Convention did, from the
Canadian government, an evasive answer, to the
effect that they had made arrangements with the
International Bank for $3 million. But they did
not tell the truth. My question was, "How much
did they apply for from the Americans, and how
much did they receive?" The Canadian government asked for a temporary loan of around
$700
million but received temporary assistance by way
of a loan of $300 million. This is the country with
which we, as a solvent and prosperous people, are
now asked to enter into partnership.
Before I enter into discussion of the attempted
fictitious budget presented by Mr. Smallwood
over a month ago, which purports to cover the
administration of the affairs of Newfoundland as
a province, let me make a sort of recapitulation
of the moneys and assets which would accrue to
the Canadian government, as well as the disbursements which will be made by that government
in Newfoundland, should we unite with Canada
I have stated that the amount of $20 million
shown in Annex IV of the Grey Book is not
correct. In my opinion the amount would be
closer to $30 million annually in the form of
revenue that would be collected by the federal
government. The Canadian government would
assume our sterling debt, which would amount to
some $64 million. This sterling debt would be
added to the national debt of Canada, and it
would appear that the people of Newfoundland
would not be liable for the interest and sinking
fund, as well as the final payment of the principal
and interest. If that is not trying to deceive our
people, I don't know what is. It really means that
the people of Canada would assume an additional
$5 per capita debt, whilst the people of Newfoundland would assume a per capita debt
of over
$1,400 as against a present per capita debt of
slightly over $250.
The Canadian government according to the
Grey Book would assume the responsibility for
the operation of our railway and general transportation system, which includes coastal
boats, etc.
However, the Canadian government does not
agree, either in the Black Books or the Grey
Book, to keep up our present railway schedule or
coastal boat schedules. Yesterday afternoon Mr.
Smallwood was trying to tangle up my friend Mr.
Fogwill in connection with the figures he had in
connection with the 15% tax on passengers,
pointing out, he said, that the rate in Canada was
3 1/2 cents, while it was 5-7 cents here. He forgot
to tell us that at the present time both the CNR
and the Canadian Pacific are trying to get an
increase amounting to 30%, which, if you add it
to 3 1/2 cents would bring it close up to 5 cents. I
think he estimated $400,000.
Mr. Cashin I figure he is $100,000 short. You
have not been able to figure it out. We have got
to take into consideration that every man who
goes on a bus from here to Carbonear has to pay
15% on his ticket, and every man travelling on
TCA and the Furness boats and everything else
coming into this country. It would be interesting
to find out the total monies paid by our people
annually for transportation. I am sure the
Canadian government do not know. Everything
is grand with the Canadian government. Neither
does it agree to maintain our present Railway
employees in their jobs or agree to the present
pension system of our Railway workers.
Mr. Cashin No. Rather has the Canadian
government indicated to us that it would be their
policy to dispense with a large number of our
Railway workers, and thereby create considerable unemployment. In this connection
I quote
from one of the so-called secret documents supplied the Ottawa delegation by the Canadian
authorities. This is what the Canadian delegation
told me, and I remember that when Mr. Higgins
brought it up he said it was not official, what was
official was in the Black Books:
Number of Employees: It is noted that the
January 1948 NATIONAL CONVENTION 1069
staff of the Railway at the present time numbers 2,990, and of the steamers 761, a
total of
3,751... This looks to be an undue number in
relation to the size of the operation, but only
a careful detailed study would reveal whether
or not the staff would likely be creased under
Canadian National administration.
And they tell us they would be offered employment by the CNR. Where? Vancouver or
St.
John's? Would they have to pick up their things
and move out of here?
In view of this and in view of the fact that the
General Manager of the Railway has indicated
that once our present capital expenditures are
completed, the Railway and its various subsidiaries would be operated at a loss of
not more than
$750,000 annually, we must draw the conclusion
that under the management of the Canadian National Railway system, the railway accounts
would be balanced and that no deficits would be
incurred. Therefore in federal revenues the
Canadian government would collect an amount
of not less than $30 million annually.
Now what amount does the Canadian government propose to spend annually in Newfoundland?
We have no definite information on
this matter beyond what appears in Annex IV in
the Grey Book (and the reply which Mr. Hollett
received yesterday, which was very indefinite),
which states that including subsidies the federal
government would spend in Newfoundland some
$27 million annually. This includes $8.35 million
in family allowances which amount may, and
probably will, be eliminated very shortly. I have
already referred to this matter in the early part of
this address. However, the amount of $27 million
does not include $3.5 million transitional grant,
which in my opinion is nothing more or less than
a "coaxer", or attempted bribe to influence our
people to join Canada. It is not a permanent grant,
as it expires within 12 years. Therefore, in addition to taking over all our assets,
which I estimate
are worth not less than $120 million and which
would be under Canadian control, the Canadian
government would make an annual profit on the
administration of Newfoundland of around $3
million. Yesterday Mr. Higgins had a reply to a
question as to what they could replace all these
things for, what it would cost, and everything.
The Commission government had not brains
enough to figure it out, because he had a nil
answer. This does not take into account any
profits that may accrue from the development of
our Labrador iron properties or the further
development of our forest industries on the
Labrador. Neither does it include any possible
revenues that may accrue from the earnings of
those people who would be employed in the
development of those industries.
Another possible source of revenue for
Canada, or if not revenue we will call it bargaining power, has not been taken into
consideration.
I refer now to the American bases located in our
country, the 99-year leases of which were granted
the American government by the government of
the United Kingdom during the latter part of
1941. During the course of this Convention,
many questions have been asked and addressed
to the Commission of Government, requesting
information which we thought would be necessary for our deliberations, and many times
we
have failed to receive satisfactory answers. In
some instances we were practically told to mind
our own business. It was therefore with some
surprise that I noticed that Mr. Hollett had succeeded in dragging forth an answer
to his question respecting the position of our military bases,
if and when Newfoundland should enter confederation with Canada....
As you know, the text of this answer is that in
such an event, the Government of Canada would
replace the Government of Newfoundland as the
lessor of these bases. I regard this position as most
significant, because what does it mean? It means
this: in the event of confederation, Newfoundland would lose all and every right,
privilege, and benefit which might have been
otherwise hers. Our people, the people of Newfoundland, would be finally and absolutely
deprived of all opportunity of capitalising on our
leased territories. And in this connection, it must
be remembered that it was one of our hopes to be
able to use our rights in these bases as an important bargaining power in connection
with the
possible export of our fish and other products to
the American market.
Now this is but one phase of the matter. There
is another one which to me at least seems of even
greater importance. It is a well known fact that
during 1946 a mutual defence pact was made
between Canada and the USA relating to the
defence of North America. And under the terms
1070 NATIONAL CONVENTION January 1948
of this pact it was provided that Canada would
control and maintain all defense locations under
the Canadian flag. What does this mean? It means
that all military, naval and air bases in this
country would be occupied by Canadian forces.
It would mean that all Americans would be
evacuated. It would mean that some $3,500 or
more Newfoundlanders now employed on the
American bases would be in jeopardy of losing
their jobs. It would mean that this country would
be deprived of the very considerable amount of
American dollars which are now being expended
and circulated. Of course, such a set-up should be
highly profitable to Canada, inasmuch as it would
consist of her receiving a free gift, as it were: after
all we have given them for nothing — the Torbay
airport and the Goose Bay airport.
Mr. Chairman Major Cashin, the chamber is
very warm, do you think that you would like a
few minutes recess?
Mr. Cashin Just a minute, sir, I want to finish
this American thing. I will sing out. Military and
naval property and equipment to the value of
hundreds of millions of dollars. I have no hesitation in saying, that if the people
of this country,
and in particular the delegates to this Convention,
had been informed of the matters to which I have
just alluded, there would never for a moment
have been any consideration given or consent
obtained to the sending of any delegation to Ottawa. It is worth noting that neither
in the Black
Books, nor in the Grey Book, nor in any of the
so-called secret documents in the possession of
the members of the Ottawa delegation, is there
any evidence or any statement to show that this
most important matter received any consideration by the delegation which went to Ottawa...
Mr. Cashin Well, why is it not in these Grey
Books, and the "Mourning Books" that is, the
Black Books? I suppose up in Ottawa you were
going to get away with it and it would not be
brought up here. I am going to repeat that statement: it is worth noting, that neither
in the Black
Books, nor in the Grey Book, nor in any of the
so-called secret documents in the possession of
the members of the Ottawa delegation, is there
any evidence or any statement to show that this
most important matter received any consideration by the delegation, or that they took
any steps
to bring the matter to the attention of the
Canadian government. I regard such an omission
as evidence of gross neglect and dereliction in
their duty of protecting and safeguarding the
interests of Newfoundland. But it would seem
that as far as Ottawa is concerned, the rights of
Newfoundland are of no importance whatever in
this one-sided contract which they have sent to
us. Why, Mr. Chairman, if there was nothing else
of an adverse nature, I question whether we have
not in this instance alone grounds, ample
grounds, for condemning the Canadian proposals
and washing our hands of the whole matter. Now,
Mr. Chairman, if you want to.
Mr. Chairman If it is agreeable to members we
will take a recess.
[Short recess]
Mr. Cashin Now Mr. Chairman, before I begin
to refer in detail to Mr. Smallwood's proposed
budget, let us see what is to happen to our accumulated surplus. This, according to
Mr.
Smallwood, would amount to somewhere in the
vicinity of $30 million. According to the
Economic Report it was $40 million, but it is $38
million now, seeing that the Commission government has seen fit to do away with $2
million.
However, we will use Mr. Smallwood's figures
and say the accumulated surplus is $30 million.
Nevertheless, we must remember that with the
advances made to the Housing Corporation, with
the inclusion of loans to various firms for the
development of the fisheries, with balances owed
by Great Britain in connection with her account
for the operation of the Gander airport, together
with other amounts owed for pensions, etc., our
accumulated surplus today must be around $38
million. However, as I said, we will use Mr.
Smallwood's figure. Take page 3 of the Grey
Book:
[1]
(1) One-third of the surplus at the time of
union shall be set aside during the first eight
years of union, either in trust or on deposit
with the Government of Canada at Newfoundland's option, withdrawable by the
Newfoundland Government as required only
for expenditures on current account in order
to facilitate the maintenance and improvement of Newfoundland public services, any
January 1948 NATIONAL CONVENTION 1071
unspent portion thereof at the end of the
eight-year period to become available for the
unrestricted use of Newfoundland.
In view of this, it is seen that under these
proposed terms of union that $10 million of this
accumulated surplus at the time of union shall be
set aside either in trust or on deposit with the
Government of Canada at Newfoundland's option, withdrawable by the Newfoundland government
as required, only for expenditures on
current account. Therefore $20 million of this
surplus remains. Nearly $10 million of this
money is now to our credit in London in the form
of interest—free loans to the United Kingdom
government, and therefore it will become necessary to convert this money to dollar
currency, and
no provision has been made for this in the
proposals now before us. Mr. Smallwood tells us
in an offhand way that he feels confident that it
can be arranged. The Canadian government does
not undertake to do this, either in the Black Books
or the Grey Book. We therefore, under these
arrangements find ourselves in the position
where $10 million has to be set aside in trust for
current expenditures and another $10 million is
located in England, and no undertaking to convert it to dollars. Therefore, there
is only another
$10 million available. Now, of this latter $10
million, at least $6 million will be necessary for
the purpose of payment of fish this past year; so
out of all our surplus there will remain only $4
million available in actual dollar currency for
purposes of capital expenditure. This means that
$16 million of our surpluses is now held in sterling and there is no indication when
it will be
converted into dollars. 1 would like to know how
much money has been paid for the conversion of
sterling as payments for fish, particularly in View
of the fact that in recent weeks the government
has made available to Italy considerable money,
and it would have been necessary for us to find
dollar currency for Italian fish. These are matters
one can only get if in contact with the government
daily. We all know the difficulties that the United
Kingdom government are having with regard to
dollar currency, but even despite the shortage in
Great Britain of American dollars, they have
been compelled to help Canada with American
dollars during the past 12 months, and when Mr.
Dalton was Chancellor of the Exchequer, he
made a public pronouncement to the effect that
Canada was in just as great a need of American
dollars as Great Britain. However, Mr.
Smallwood may have something up his sleeve in
this respect, for if we follow his explanations of
all these matters we must conclude that he has
been appointed the representative of the
Canadian government as well as the Commission
government. However, I feel certain that any
such statements made by Mr. Smallwood have
been based purely on personal opinions, and that
he has no foundation in fact for any of these wild
statements he has been making.
Then again, I am forced to refer to the present
serious financial predicament in which Canada
finds herself. It is only a couple of months ago,
whilst Prime Minister King was on an official
visit to England, that serious steps had to be taken
by the Canadian government to deal with the
financial position. As a matter of fact, unprecedented steps were taken. These were
the restrictions of the purchase by Canadians of a long list
of consumer goods from the United States. In
addition, extra taxation had to be placed upon
consumer goods at home and all this was done by
minute of council. Now it is well known that
under British procedure, no taxation can be legislated for by minute of council. Such
legislation
must be passed by Parliament. We had it happen
here over 50 years ago — an incident whereby a
certain gentleman who was in public life went
down on the wharf and took goods off it because
the budget had not been passed and he got away
without paying any duty. Some of their relatives
occupy high positions in the present set-up of our
civil service. However, I ran into conflict before,
and I do not want to do it again.
As I said a moment ago, the situation was so
serious that this present austerity programme was
instituted by the Canadian cabinet and at the
present time it is being fought bitterly in the
Canadian House of Commons. Canada had applied many months ago for a loan of $800,000
in
the United States and was forced to accept a
temporary loan of but $300,000. In addition, the
Canadian National Railway, which is seeking a
loan of some $60 million from the public, has
been forced to withdraw the application for such
loan temporarily because underwriters' offers
were unsatisfactory, according to reliable reports.
In view therefore of these known facts, how are
we to expect the Canadian government to be in a
1072 NATIONAL CONVENTION January 1948
position to convert this $16 million now owed us
by the United Kingdom, when the records show
us conclusively that Canada is on the hard dark
road of austerity herself, and is at present,
through the medium of Canadian banks operating
in Newfoundland, taking advantage of our credit
balance of American dollars to bolster up her own
credit. In my opinion this whole matter is a matter
of such serious importance that I consider that
this Convention as a body is not competent to
deal with it. It is a matter for proper negotiation
between two governments elected by the people
of both countries.
Again I state that this confederation issue has
been deliberately engineered by both the
Canadian government and the British government for the purpose of confusing the minds
of
our people in such a way as to convey to the world
that we Newfoundlanders do not know what we
want, what we really want in the form of government. People have come out from England
during
the past five or six years and went back, and said
that we do not know what we want, and that is
the way they want to keep us. It is a definite
violation of the solemn pact made between the
Government of Newfoundland and the Government of the United Kingdom in 1933, and we
as
delegates to this National Convention have made
ourselves parties to the violation of that agreement. Today, many of our people have
forgotten
about this agreement of 1933, but there are a great
number of those who voted for that legislation in
1933 still in this country, several of whom now
occupy positions of trust in the service of Newfoundland. I hold that these gentlemen
who voted
for that legislation in 1933 should now come
forward in the interest of the country and give to
our people the particulars of what happened at
that time — what undertakings, if any, were
given regarding the passing of this legislation I
say, sir, that these gentlemen should come forward now and make public what transpired,
unless they also are prepared to see a solemn
agreement to which they were a party, unless they
too wish to witness that solemn pact being ground
in the mud under the iron heel of the United
Kingdom government...
Mr. Chairman You are drawing a conclusion.
You are on thin ice.
Mr. Cashin That is my personal opinion as a
Newfoundlander, and I am entitled to it. They
should come forward and tell the people what
actually transpired and what was the understanding in 1933. I will go further and
say that if
they do not come forward, if they fail to do that,
then they fail in their duty to the country and to
the people of the country and will be considered
as such.
As I have stated before, the Ottawa delegation
brought back no report to this Convention. The
Ottawa delegation has not been able to supply us
with any definite or concrete replies to our
numerous questions. There has been no effort by
any other delegate of that delegation to enlighten
us in any way with the exception of what we have
been told by Mr. Smallwood. And even Mr.
Smallwood has admitted to the Convention and
to the people of the country that these various
estimates of expenditures and revenues were
prepared for the Newfoundland delegation
months before they arrived in Ottawa.
Mr. Cashin We have not received any explanation of this from any other member of the Ottawa
delegation and we can only surmise that the Ottawa government had been supplied with
various
statistical information in advance by the Commission government. It is therefore apparent
that
the Ottawa delegation were acting more or less
as a sort of international brokerage association on
behalf of the Commission of Government.
Mr. Smallwood Point of order. The Ottawa
delegation was sent to Ottawa by this Convention
and acted for this Convention, not as agents of
the Commission of Government. I ask him to take
that back. If he is fair, he will retract that.
Mr. Chairman The actual position is this: this
Convention ... appointed and sent a delegation to
Ottawa.... Whether it did a good job or a bad one,
two things are clear:
1. The Convention has to accept collectively
the responsibility for sending the delegation
to Ottawa; and
2. The delegation is open to criticism by this
Convention.
But criticism should, of course, be limited and
circumscribed within the limits of fair comment.
The status of the delegation was as agent of this
Convention. It was the created representative of
this Convention and nothing else in fact and in
law, no amount of argument can convert it into
anything else.
January 1948 NATIONAL CONVENTION 1073
Mr. Cashin The Ottawa delegation went to Ottawa, they brought back two Black Books. That
was their report. The Grey Book which contains
the terms and proposals was sent here, not
brought here by the Ottawa delegation; it was
sent here by special courier to His Excellency.
The delegation did not have anything to do with
bringing them in here.
Mr. Chairman The facts are that these documents were forwarded here as a result of the visit
of the delegation.
Mr. Cashin Why did they not bring them back
themselves?
Mr. Chairman That is a question you are
properly entitled to ask.
Mr. Cashin The delegation should have been
given them; but instead, they sent them to the
Governor, who is Chairman of the Commission
of Government.
Mr. Chairman I am not going to permit you to
refer to His Excellency in a manner calculated to
reflect upon his dignity as the King's representative. It is an appalling breach which
I cannot
allow. These documents were sent by the Prime
Minister of Canada to His Excellency the Governor as the King's representative, and
were forwarded by him to this House at the request of the
Prime Minister of Canada. That is the position.
Mr. Cashin His Excellency had a letter which is
tabled in this report. I am not reflecting upon him
as the King's representative.
Mr. Chairman It is my duty to see that you do
not.... Here is a request by the Prime Minister to
the King's representative here to forward certain
information which ostensibly was prepared as a
result of a visit of the delegation which this
Convention sent to Ottawa. All His Excellency
the Governor does is comply with the request of
the Prime Minister in sending these documents in
question.
Mr. Cashin It is quite evident that the Ottawa
delegation did not receive any terms or proposals.
They came back with two Black Books.
Mr. Cashin They went up there, spent three
months and brought back nothing.
Mr. Cashin You got nothing. You were sent
back with your tails between your legs. You got
the cold shoulder. The Canadian government
knew you had no power to negotiate such things
as confederation. They just told you to go home
and they would send you something in two or
three weeks. It is the most outrageous document
that ever came in through the doors of this assembly.
However, when we were unable to drag from
Mr. Smallwood any definite information, we
finally encouraged him to present to this Convention and to the country a proposed
budget of the
anticipated revenue and expenditure of the Newfoundland provincial government. This
document, by the way, is not presented on behalf of
the Ottawa delegation, but rather by Mr.
Smallwood himself, and we must therefore conclude that the Ottawa delegation had no
act or
part in its compilation. At the outset, let me say
that in my 25 years experience as a member of
the House of Assembly, and as a close student of
our financial affairs — after having read every
budget speech since 1909, Imust confess that Mr.
Smallwood's attempt displays the most glaring
and highfiying attempt at "frenzied finance" that
I have ever witnessed. Well do we remember Mr.
Smallwood's deliberate attempt to belittle the
efforts of the Finance Committee in its presentation of both the Financial and Economic
Report,
how he used every conceivable method to show
to the country the hopelessness of our financial
and economic position; now he has the gall to
attempt to shove down the throats of the delegates
and the people of Newfoundland this proposed
provincial budget, which in my opinion is cooked
up from beginning to end.
Mr. Cashin I am going to prove that it is cooked
up, so sit down.
Mr. Smallwood I may say that the word "cooked up" is a favorite word of Mr. Cashin's. Does
he mean falsify ?
Mr. Cashin It is soggy, it is not done. Did you
ever see a soggy doughboy? It is not based on any
sound foundation whatever. To use Mr.
Smallwood's own words, there is nothing in these
few pages worth tearing to pieces. Let us have a
1074 NATIONAL CONVENTION January 1948
look at this mysterious proposal, this personal
Smallwood plan for the proposed administration
of the affairs of Newfoundland as a province of
Canada. It is not a budget in the strict sense of the
word. This thing does not contain any explanations of the various items of revenue
and expenditures in its few and scattered pages and
guesswork estimates.
When Mr. Smallwood went in to hysterics in
his feeble effort to tear to pieces the Economic
Report, he ridiculed the Finance Committee for
its attempt to introduce a document which
forecast the future of Newfoundland for a period
of three years. He now has the impudence to
come into this chamber and introduce a concocted document based on practically nothing,
but he tells us, and he tells the people of Newfoundland, he is making his forecast,
not for three
years mind you, but for a period of eight years.
He practically tells the world, as Mr. Reddy so
aptly put it, that he alone, Joseph R. Smallwood,
is the only individual in this Newfoundland of
ours who should be permitted, and who is capable
of producing such a forecast. He tells us, so to
speak, that he is infallible, and that the people of
the country, north, south, east and west, must
recognise in the delegate from Bonavista Centre
the only individual in the country who knows
what will happen within any given period.
Mr. Cashin Mr. Smallwood has stressed the
infallibility of Canadian experts. He now evidently has taken upon himself the role
of
astrologer or fortune teller for the people of Newfoundland.
Now Mr. Chairman, Mr. Smallwood himself
has admitted that the forecasts which the Ottawa
delegation, of which he was secretary, gave to the
Canadian government with regard to the
revenues and expenditures of a Newfoundland
provincial government were incorrect, and in
view of that fact he has taken upon himself to
present a corrected estimate on his own. In the
Black Book, Volume 2, is to be found the estimates of expenditures of Newfoundland
as a
province of Canada. These amount to $14.4 million. Today the estimates of expenditure
presented by Mr. Smallwood for the administration of the province of Newfoundland
come to
approximately $15.5 million, or $1 million more
per annum than contained in the Black Book.
This deficiency was made up by the fact that the
Ottawa delegation forgot to include in their expenditures approximately $500,000 in
interest
and sinking fund on our local debt, as well as an
additional $100,000 for civil pensions.
If we peruse these estimates what do we find?
We find that at least 1,200 civil servants will be
laid off from work, but Mr. Smallwood tells us
that once we become a province these people who
have been dispensed with provincially will be
employed in other departments of the federal
government established in Newfoundland. In
fact, he went so far as to say that an additional
1,000 people would be required to administer the
affairs of the Canadian federal government. This
to my mind was a wild and incorrect statement,
and there is no evidence contained in any of the
documents to show that this will occur. Rather do
I hazard the opinion, my personal opinion, that
many hundreds of our civil servants would be put
on the unemployed list. In the estimates for
Public Health and Welfare as contained in the
Black Book we are told by the OttaWa delegation
that an amount of $4,767,000 will be sufficient.
However, Mr. Smallwood has increased this by
another half million dollars.
Now let us survey the various departments
which would have to be financed by the province
of Newfoundland should our people decide that
Newfoundland would unite with Canada. What
do we find? We find that the following departments would be those over which the control
of
expenditure would come within the scope of the
province: Education, Justice, Natural Resources,
Public Works, Public Health and Welfare, the
Liquor Control, Home Affairs and provincial
treasury. All these departments, according to Mr.
Smallwood, would involve an annual expenditure of approximately $15.5 million. Let
us see
what these departments are disbursing now in
comparison to Mr. Smallwood's estimate....
[The committee rose and reported progress and
the Convention adjourned]
