Mr. Speaker, I appreciate the opportunity to speak to Bill C-38. Before I get into my speech I must commend my Bloc colleague for trying to impress on the House how important agriculture is to Quebec. It has always been appreciated by myself and other Reform MPs that Bloc members take such a unique interest in agriculture. They realize that we have to eat before we do anything else.
Bill C-38 is a quick way of fixing a farmer's problems. It decreases the time of suffering, but I still do not like to see that kind of thing happening.
The Farm Debt Review Act was established in 1986 in response to exceptional circumstances. The late seventies and the mid-eighties were difficult times in the agriculture sector. Family after family was forced to leave farming because it was not profitable. Why was it not profitable? Because of too much government interference.
Some members of Parliament will remember that in 1970 or 1971 the Liberal government of Prime Minister Trudeau was elected. The slogan at that time was we will create a just society. That sounded good. Everybody in western Canada felt that maybe conditions for western farmers would be improved, as well as conditions for western processors and the special crops industry.
The first thing that Liberal government did was increase the wages for grain handlers by 68 per cent in one shot. That was very extreme, although at that time their wages were probably not what they should have been.
That started a whole series of problems. The next thing the government of the day did, because of low grain prices, was to establish a program known as the LIFT program. I do not know, Mr. Speaker, if you were around at that time or if you remember that program. That program was designed to encourage farmers to summer fallow their land and to decrease the supply. They were paid $8 an acre to summer fallow their farmland.
That was a bad mistake. There was a crop failure the following year and the billion bushel surplus that everybody talked about, which was depressing prices, was gone. It was not there because of mismanagement in estimating what was held in reserve. That happened because three or four different grain companies in each town and each grain company, more or less, surveyed how many bushels were in the area, added them together and came up with an estimate which was three or four times higher than it should have been.
In 1972 we had grain prices the likes of which had never been seen before. Prices of $1.50 per bushel jumped to $5 and $6 a bushel. It was inflation. The farmers did very well. They started to be optimistic. People were encouraged to spend money.
The worst thing that happened was that government officials tried to encourage farmers to specialize. If a farmer wanted to
borrow money to improve his milk herd, or dairy operation or hog operation and wanted $5,000, $10,000 or $15,000, the Farm Credit Corporation would say: "No way. You have to get your act together and direct your energies toward one operation". If you did not borrow at least $50,000 or $100,000 you were denied the loan.
That gave farmers the direction to specialize. We saw small operations being closed down and bigger operations starting. Before we realized it, many farmers had a debt load that was beyond servicing when interest rates started, all of a sudden, to jump because of the money supply.
If I had not have been out of the country in 1981 and seen what inflation did in other countries, I probably would not have realized how detrimental it was to our country. However, when 24 per cent interest rates developed and farmers had debt loads of between $100,000 and $200,000, their debt load increased by one-quarter each year and they were unable to service that debt load.
This was the just society. I do not know if it was a just society for the bankers, the financiers or for whom. At that time I know there was a big debate on whether we should do away with the Crow and whether we should do certain other things.
I will never forget a program I was watching one night called Front Page Challenge . Members might remember Mr. Gordon Sinclair who was one of the specialists on the program. They were talking about the huge recession in the country. All of a suddenMr. Sinclair could not sit still any more and said: ``What recession? Twenty-four per cent interest rates. What recession?'' The financial institutions and investors were making huge profits. People did not realize we were losing farmers and business people left and right.
I will never forget the comic made out of the huge Liberal milk cow. Mr. Speaker, you might remember that picture. It showed this huge Liberal milk cow and the western farmers were feeding it as fast as they could. They were scrawny, poor, overworked and looked almost like skeletons compared to the huge cow. While the farmers in the west were feeding this huge Liberal milk cow, they were really feeding the eastern interests. Those interests were collecting the money and getting their 24 per cent interest rates.
The worst of it was that when one has a huge milk cow there is some organic material that has to be disposed of because otherwise it is environmentally unfriendly. Therefore, this organic fertilizer was dumped on the eastern provinces and it pretty well buried them. So we had three little problems. We had the western farmers starving to death. We had the eastern interests getting filthy rich and paying more income tax and the eastern Atlantic provinces being buried by something they did not really like. That was the situation that got western farmers into a huge debt load.
Looking back on the issue today, if we could have avoided the high interest rates at that time, we would have a lot more small business people still in business in western Canada and the family farm might not be in the position that it is today.
However, I want to get back to the debt review board. When we had the old board, it was at least willing to look at farmers who were viable and give them support and try to get them to reorganize.
Bill C-38 is only there, more or less, to get farmers out of business. Once you get to that point, I am a firm believer that just consultation and some advice is not sufficient. As members know, when banks or financial institutions are prepared to take over one's assets they have the best legal advice and the best consultation services available. They do not care about the cost. However, when a farmer is under that type of stress he does not have any financial power. He does not have the economic resources to get that type of advice.
If the government was really diligent and wanted to do something for farmers, it would make funds available to them to get the expert advice and consultation service needed because the banks or financial institutions have the upper hand.
During that time, I think during a Liberal government, I know there was a very big debate about the Crow rate. It think a prop of a crow being hung was brought into the House at that time. There was quite a bit of confrontation here. There was talk that governments were willing to bail out western farmers with the crow to a tune of $15 billion. That was its values then.
Some farm organizations were stubborn and did not realize how critical the issue was. They felt that it was not enough, was a very bad deal for western farmers and refused it. Fifteen billion dollars in 1978 or 1979 compared to $1.5 billion today is just a Mickey Mouse amount, peanuts. Big mistakes made in western Canada.
When we look at the grain transportation system we see that we did something in the House in the last year. We bought out the crow with $1.5 billion and did not have the transportation system in place that should have been there.
We heard from our colleagues from Peace River and Vegreville that farmers are in dire straits today because of the grain in their bins or out in the fields. Bill C-38 will be used probably more than ever before to liquidate farmers.
This is a sad situation. In such a desperate situation some special provisions should be made like we see in many big businesses instead of only having good consultation services available. They ask for bankruptcy protection for a certain time to see whether
things can be ironed out. They do not have the financial assets to protect themselves.
As the Bloc member pointed out, food is number one. If we cannot protect our food supply industry or our producers, sooner or later the country will fold. That is one point I have always appreciated. Even if we do not agree with a lot of the philosophy of Bloc members on the agriculture committee, this is one point we agree on. Agriculture is most important. A trip to a Third World country or an eastern bloc countries makes one realize the value of food very soon.
I met a young lady who was in Canada with a Chinese trade delegation shortly after I was elected. I asked her what she liked best about Canada after having seen some of it. She said the thing she liked best was our cheap food. I asked her what she meant by cheap food. I had no idea what that meant for the Chinese. She gave an example of a McDonald's in the city where she lived that charged exactly double in Chinese dollars what she would pay for the same hamburger in Ottawa.
I asked her how the amount of money spent on food compared to the earning power in China. She indicated that a high wage earner in China spent about 30 per cent to 50 per cent of his wages on food. We have a food basket cost that is about 11 per cent to 12 per cent of our earning power. That helps us see what kind of a blessing we have in Canada.
As was pointed out by another member, when we talk of farmers being subsidized to produce a product it is a subsidization for the consumer to get a cheaper and better product. They are the beneficiaries.
Let us look at the net income of farmers today. I am using Statistics Canada figures. They indicate that 48 per cent of net farm income comes from off farm jobs. We see what is happening to our food production system. If we do not change the system to a market driven, viable food production one, other systems will collapse along with it.
It is very important to realize that we have gone from a system of specialization. It did not work. Then farmers were told they had to become more efficient. Now we have a system that says we have to diversify. How much can they diversify when 48 per cent of their net farm income comes from off farm jobs?
We also hear that there must be value added industries. When farmers are financially strapped they do not have money to invest in value added industries. Somebody else will do it.
To make the farm economy viable again we must take some strong measures. After the next election I hope we will have a Reform government that is interested in making the system efficient, viable and self-reliant. That will transfer into other industries and we will have a country that does not need higher taxes or government support. That is the direction the country must go in.
At the Forum of Young Canadians banquet yesterday I saw their energy, interest and dedication to making the country work. They need a system that will look after some of the huge debt put on their shoulders by the government. They could make the country as viable as it should be.
We have the natural, renewable and human resources to do it. We need some expertise that we have not seen in the last 25 or 30 years of Conservative and Liberal governments. They have been directing our industry and have failed us every time.
It is imperative the electorate in the next election looks at the platform of the Reform Party. It proposes huge changes that will give provinces the right direction to do what they do best and will give the federal government the tools to do what it should do to reduce taxes, to bring down the deficit and to make the country a better place to live. We have heard our leader say a number of times that we could provide a better Canada and a better future for Canadian youngsters, for future generations.