1910-04-12

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Bill (No. 201) for the relief of John-Green.-Mr. Edwards.
Bill (No. 202) for the relief of James Thornton Brownrid'ge - Mr. Blain.
Bill (No. 203) respecting the Essex Terminal Railway Company.-Mr. A. H. Clarke.

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Mr. Albert Allard, member for the elee-torial district of the City of Ottawa, introduced by Sir Wilfrid Laurier and Mr. Mc-Giverin.

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On the order of the day being called,
Mr. CAMPBELL.: Since December 7, I have had on the order paper a Bill which I wa^ prepared to discuss, but- which as a matter of courtesy to the Prime Minister who was leaving the House I allowed to stand over until opportunity offered. When may I have that opportunity1?


Sir WILFRID LAURIER.: I believe the Bill related to the question of a member being elected for two different constituencies, its object being to compel him to make an election as to which seat he would sit for. I am glad to say that the committee who are revising the rules have a rule on this subject which I think will meet all the objects my friend seeks to obtain by this Bill.



COMBINES INVESTIGATION ACT.

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Hon. MACKENZIE KING (Minister of Labour) moved that the House go into Committee of the Whole to consider the following proposed resolution:
Resolved, that it is expedient, in connection with Bill (No. 101) now before this House respecting the investigation of Combines, Monopolies, Trusts and Mergers, which may enhance prices or restrict competition to the detriment of consumers, to provide for the appointment of Boards of Investigation for the purpose of inquiring into alleged combines causing enhanced prices or restricted competition, for the appointment of counsel to conduct investigations before such boards, and for the payment of the members of such boards and of counsel, and of witnesses appearing before the boards, and of all expenses of boards, including transportation expenses incurred by the members thereof, or by persons under orders of such boards, in making investigations under the Act, and salaries of employees and agents and the payment of clerical and other assistance.
He said: This resolution is necessary in connection with Bill (No. 101) which I had
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the privilege of introducing in this House nearly three months ago. It might be well, perhaps to precede any remarks it may be necessary to make on the second reading of the Bill by some reference to the purpose of the introduction of the measure at this particular time, the object which it is hoped the Bill will serve and the spirit in which the measure has been introduced. There is no question to-day which has attracted so much attention in this country, and particularly in the United States, as the question of the cost of living for the mass of the people of the country. We have during the last few years experienced a serious" and a considerable rise in prices. This increase in the cost of living has not been confined to any one class, rich and poor alike have had some experience of it, but it has had a very serious effect upon men of limited incomes, upon the wageearning classes, upon those whose salaries are fixed and those who do not receive much in the way of remuneration. To one family after another it has meant curtailment of enjoyment, the foregoing of opportunities of education or recreation, a neglect of future needs, and the claims of others for future support, the giving up of insurance policies; to many it, has meant a mode of living less congenial or beneficial to that previously enjoyed, to some, downright privation and hardship; to all sacrifices of one kind or another. That it could not be otherwise, where incomes or wages have not proportionately increased, actual statistics must make apparant enough. It is this question of the cost of living which has helped to make the question, of combines, monopolies, trusts and mergers and the possible effect they may have on prices, so important. In the popular mind there has come to be a gradual association between these two phenomena. In the first place, people have experienced the rise in prices, and in the second place, they have observed the formation in increasing numbers of these large aggregations of capital, and they have got it into their minds that these two phenomena are associated one with the other. I think there may be some reason for that in particular cases, but I believe there are other explanations which will account for the rise in prices than the formation of combines and trusts. Similarly while combines and trusts may have had the effect in some eases of increasing prices, they have not always had that effect, but sometimes an effect entirely different, and I would like the House to understand that in introducing this legislation no attempt is being made to legislate against combines, mergers, and trusts as such; the whole intention is to place some restraint on these large aggregations of capital so that the advantages which may Mr. KING.
come from large combinations of -wealth may in some measure be secured to the public, who have helped to make possible these large combinations.
It may be interesting to the House to have an idea of how the cost of living has increased in the last few years. I have here a series of charts being prepared at the present time by the Department of Labour. These show in statistical and graphic form the increase that has taken place in the last twenty years for the different classes of commodities in this country. Just taking a casual glance at them one observes that in the past 20 years prices have, broadly speaking, increased something like from 30 per cent to 40 per cent in most of the commodities which are in the nature of the produce of the farm and the field. Manufactured articles have not increased to the same extent, but there has been a very perceptible upward lift during the last ten years over what was the average rate between 1890 and 1900. As a matter of fact prices were at their lowest ebb in 1896 and 1897. Since that time allowing for the temporary depression of 1907, they have gone up steadily, and if we look at the movement from 1896. to the present time, we will see that in some commodities prices have increased as much as nearly 70 per cent or 80 per cent over what was the average in the years 18901900. It would take too long to explain at any length the details, but I would like to indicate what has been the nature of increase that has taken place. These tables have been prepared by Mr. Coats, the associate editor of the ' Labour Gazette.' Mr. Coats- has done very excellent and indefatigable work in the preparation of these tables. The statistics have been gathered for a period of over 20 years past and have been gathered from leading trade journals, market quotations and reliable sources in different parts of the Dominion, and I believe that when the report is prepared we will have one of the best reports on prices ever produced on this continent.
Two or three years ago an investigation was made in connection with the Royal Commission appointed to inquire into conditions in the Civil Service and in connection with that investigation a memorial was presented to the commissioners. Referring to this memorial one finds that as the result of an investigation at that time the statement is made that it would be safe to say that for families living in Ottawa on incomes varying from $600 to $900 the rate of advance in the decade from 1897 to 1907 was between 30 per cent and 35 per cent. Of course, the rate of increase in the cost of living will be more considerable to people on smaller incomes. The rates were:

Amount of Income. Rate of Increase. $ 300 34% 1,200 30% 2,000 25% These figures might be supplemented from a large variety of sources. Taking the result of the investigation in the Department of Labour to which I have made reference, one finds the following increases in wholesale prices by groups of commodities compared with the average rate for the decade 1890 to 1899 and compared with 1896: Table showing increases in wholesale prices by groups of commodities.		
Group of Commodities.	Percentage of increase in prices, 1909.	
	Compared with decade, 1890-1899.	Compared with 1896.
Grains and fodder (13 commodities)	per cent. 500	per cent. 76-0Animals and meats (14 commodities)	48-6	800Dairy produce (5 commodities)	33 6	48 0Fish (9 commodities)	340	31 0Other foods (37 commodities)	7-6	230Hides, tallow, leather, boots and shoes (11 commodities)	354	45 0Implements (10 commodities)	24	40Fuel and lighting (9 commodities 	4'0	5 0Building material- a. Lumber (12 commodities)	54 6	60-0b. Paints, oil, and glass (14 commodities)....	35-2	400House furnishings (15 commodities)	104	140Drugs and chemicals (1G commodities)	40	50Miscellaneous- a. Furs (4 commodities)	127 2	180 0b. Liquors and tobaccos (4 commodities) ....	17 5	200All 173 commodities. .	260	40-0
It will be seen that on certain classes of commodities, the classes on which the masses of the people mainly depend, grain, fodders, animals, and meats, dairy produce, and foods, hides, leathers, boots and shoes, and the like, the increase has been very much higher than the average, it has ranged anywhere from 30 per cent to 50 per cent.
These figures are borne out by investigations made in other countries. Recently the Department of Labour of the United States made an investigation into wholesale prices for the years from 1890 to 1907. The Department of Labour there found that for the year 1907 the highest recorded level of prices was reached since 1890. The rise from 1897, the low point as worked out by the department is 44.4 per cent.
Mr. LENNOX.: The hon. minister has mentioned that although combines generally had a tendency to enhance prices, there were instances in which they had riot that effect. Would he mention an instance?


Mr. KING.: I am not aware of having said that combines generally increased prices. I said that in some cases I thought that they had, and in others, I did not think they had.


Haughton Lennox: Will the hon. minister mention an instance in which they had not that effect?


George Gerald King: I am comng to that point a little later on. Recently the House at Washington ordered a special investigation into the causes of the increased cost of food, and other products. I have here a report from the Secretary of the Department of Commerce and Labour, transmitting tables giving percentages of the increase in prices of food and other products. This investigation corroborates in many details that made by the Canadian Department of Labour, showing that prices have increased during the last decade from 25 up to 50 and 70 per cent in the different classes of commodities in the United States. A comparison between the movement of prices in this country and the United States and Great Britain would go to show that, in all three countries, they have risen materially, but that the rise has been more considerable in the United States than in Canada, and in Canada than in Great Britain.


Mr. EDWARDS.: How does the rise in prices of agricultural' products in Canada compare with their rise in the United States?


George Gerald King: It would take considerable time to go through the figures in individual cases, but I shall be very glad at any time to give information on those points later. In the discussion in committee we can take up the individual subjects. I would ask hon. gentlemen to allow me to make a general statement in the first place.


Mr. R. L. BORDEN.: The best course would be to take a note of any information desired and endeavour to give that in committee.


George Gerald King: Referring to another source, a record of prices on 96 commodities compiled by Bradstreets on January 1, 1910, shows that prices in the United States, on that date had reached an absolutely high

Teeord mark. The increase is 61 .per cent over the figures of July, 1896, which was the lowest price touched by Brad-streets calculations. Mr. Blue, the Census Commissioner for the Dominion, prepared a statement two or three years ago regarding the increase in the cost of living in this country, and he found that there had been, during the fifteen years from 1892 to 1896, an Increase in the prices of food products, ranging from 15 to 20 per cent. In 1906, there had been a rise which would bring the increase up to a larger percentage. Then there have been three or four other important investigations conducted by different bodies.
Throughout the Dominion the steady increase in the cost of living, especially since the beginning of the present century, has been the subject of repeated comment, and, in almost every city or centre of employment, of more or less careful examination. In 1906 the Ontario Educational Association went carefully into the whole matter, in connection with the arrangement of teachers' salaries, with the result that an increase amounting to thirty per cent in 10 years was shown. In 1907 an estimate . made by the Synod of the Church of England in the city of Quebec placed the increase within the decade at a much higher rate. In the city of Toronto, an investigation conducted with care and minuteness during 1907, by the Department of Political Economy of the University of Toronto, also showed a higher rate of increase. These examples could be multiplied.
All show upward movement since 1896- 30 to 35 per cent higher than the average for 1890-99 ; 40 to 45 per cent higher average, 1896-97.	,
The cost of living has increased from 30 to 40 per cent in the case of incomes ranging from $2,000 down to $500. That is a fact which has impressed itself upon all classes of the community. Now what has the community been witnessing in another direction ? We find the increase in the cost of living going on simultaneously with the organization of capital on a large scale, the formation of trusts, mergers and combines of one kind or another. I have the figures here with regard to combines in the United States, and these combines have had their effect on the people of this country, as well as those of the United States. Quoting from Nelson's Encj^clopedia of 1909, which has the latest information gathered on the subject, I find that :
Down to 1898 the number of trusts formed (in the United States) was small. From 1898 to 1900 not less than 149 such combinations with a capitalization of over three billion dollars was formed. A large number of combinations have been effected since 1900, the most important of which was the United States Steel Corporation with a capitalization of $1,400,000,000. The aggregate Mr. KING.
capitalization of such corporations in 1906 is variously estimated at from six to eight billion dollars. . . . The Sugar Trust, it has been estimated, controls ninety per cent of the output of refined sugar in the United States; the Standard Oil Company sixty-five per cent; the Rubber and Paper Trusts about seventy per cent of their respective products; the Steel Trust less than sixty per cent. The six great packing companies -the ' Beef Trust '-slaughtered only about forty-five per cent of the cattle killed in the United States in 1903. The Salt Trust controls over eighty per cent of the salt produced in the country, and the Starch Trust about ninety per cent of the starch. Where *the proportion of the industry not controlled by the trust appears to be considerable, as in the case of the Standard Oil Company, allowance must be made for the output of companies ostensibly independent, but in reality controlled by the trust. Furthermore, while in some industries a large proportion of the business may be in fact as well as in name independent of the trust, as m the case of the slaughtering industry, the great combination, nevertheless, controls certain markets without much interference from competitors. The six great packing companies furnish 75 per cent of the beef consumed in New York; in Boston they furnish over 85 per cent; in Philadelphia and Pittsburg 60 per cent; in Providence more than 95 per cent. In the greater part of the smaller cities and towns of New England the trust furnishes more than three-fourths of the consumption.
I shall not weary the House with statistics of the growth of trusts in the United States, but will refer hon. gentlemen to a book written by Mr. John Moody, entitled, ' The Truth About Trusts,' in which they will find tabular statements regarding the large amalgamations in the United States during the last ten years, the number of plants acquired or controlled and the total capitalization, stocks and bonds outstanding. An analysis of these figures slightly in detail would show that of the industrial trusts 15 have $100,000,000 capitalization or over, 33 have $50,000,000 or over, 165 have $10,000,000 or over, and 451 have $5,000,000 or over. Of the franchise trusts 16 exceed $100,000,000, 41 exceed $50,000,000, and 156 exceed $5,000,000. Of the six greatest railroad groups, all exceed $1,000,000,000 capital.
These figures should make every one realize the tremendous power thus vested in the hands of a few men and point to the necessity for some agency in the direction of state control to see that this power is not exercised to the detriment of individuals or the public. No exception can be taken to a trust doing all that is justifiable to further the interests of those whose capital is invested in it, but the business should be carried on with due regard to the interests of the large body of consumers who make up society.


Wilfrid Laurier: Hear, hear.


George Gerald King: While we have had this growth of mergers and trusts in the United States, we have had a somewhat similar growth, though not on so large a scale, in this country. Before 1909, there was not a large number of these corporations in Canada, although the Montreal Light, Heat and Power Company, the Dominion Textile Company, the Canadian Breweries Company, and the Canadian Consolidated Rubber Company, are large aggregations of capital that will be present in the minds of all here. I have here a statement showing the different mergers that have been effected since 1901, but will pass over that for a moment. Last year, 1909, was a year in which so many mergers and consolidations took place that no less a financial authority than the ' Monetary Times ' refers to the circumstance as constituting the year 1909 ' merger year.' There can be little doubt these consolidations were an outstanding feature of the industrial and financial situation of Canada during the last year. There were formed in that year the Amalgamated Asbestos Corporation, Limited, the Black Lake Consolidated Asbestos Company, Limited,	the	National	Breweries	Company,Limited,	the	Canada	Cement	Company,Limited,	the	Carriage	Factories	Company,Limited,	the	Canadian	Car and	Foundry
Company, Limited, the Quebec Railway Light, Heat and Power Company, Limited, the Siemon Company, Limited, the Canadian Consolidated Felts Company, Limited, and we are told of a contemplated merger in the maritime provinces of the Dominion Iron and Steel Company and the Dominion Coal Company. These figures would, I think, bear some careful study, not necessarily as reflecting in any way upon the organizations concerned in these particular mergers, but rather as helping to illustrate an industrial, development in our country, a development which is likely to increase during the years to come; and unless the mergers and trusts are to be wrongly judged by the public, they must in some way be made subject to a larger measure of state control than they are at present. If one will . look over the press since the beginning of the present year, he will find that there is hardly a day when mention is not made of some new consolidation or merger. And these announcements come out simultaneously with the experience every one is having of the increased cost of living. The fact that these two things have come together has brought about an association between them in the minds of the public in the nature of cause and effect. My reason for dwelling at some length on both these points is that a truer discernment may be arrived at of the nature of the phenomena into which we are examining and the results to the community.


Mr. J. HAGGART.: Do you know whether these combines, or trusts have acted injuriously to the public?


George Gerald King: I have nothing to say in that regard. I have not any evidence at the moment to offer to the House, but 1 would refer hon. members to the report of the select committee appointed in 1888, when the late Mr. Clark Wallace brought up the subject of combines and consolidations I could quote a considerable amount of evidence given before that committee to show that some of these trusts have acted in a manner injurious to the public, and there is strong reason to believe that, without going into details of individual cases, an examination into some, not all of them, would show they had acted in a manner hardly considerate enough of the interests of the vast body of consumers.


Mr. BLAIN.: Could my hon. friend give us any figures which would show that since eight or ten years, during which he said some combines have existed, the articles in which they deal have been made dearer to the consumer.


George Gerald King: One might name a great many, but I perhaps would do injustice to individual concerns were I to single any out. I might do injustice for thi3 reason that while there has been a rise in prices, that has been due in many cases to a large number of causes. The legislation we are proposing is legislation which will afford an examination into the business of every large concern, where there is reason to believe that a combine is operating to an undue disadvantage of the public; and until an examination of its business had taken place, I would hesitate to say that it has been acting unfairly. The fact that the increase in prices, and the formation of these large mergers, anid! combines have taken place simultaneously, has created in the minds of the people a strong impression that the two are intimately connected, and the public are demanding some kind of legislation which will enable them to see whether they are right or wrong in that particular.


Some hon. MEMBERS: Hear, hear.


George Gerald King: It has become impossible to disassociate in the popular mind the two outstanding phenomena, the one a matter of daily observation, the other of daily experience, and the public has come to believe that in some way, or to some degree, the increased cost of living which it has had to bear is in some hidden or unfathomable manner linked up with these uncontrollable aggregations of wealth representing gigantic interests and possessing gigantic powers. I was just about to mention

that there are innumerable instances of mergers alleged to have been formed during the present year. In the Halifax ' Chronicle ' of February 21 it is stated that:
The Engineering and Mining Journal of New York, one of the chief authorities of the iron and steel trade says in its current issue that reports come from Montreal and Toronto that negotiations are in progress for consolidation of Canadian iron and steel interests, somewhat on the line of the United States Steel Corporation.
The ' Canadian Miller and Grain Elevator ' of March, 1910, refers to alleged mill mergers. That paper says:
_ It is believed that abont ten mills are being considered in connection with the merger.
The Hamilton ' Times ' of February 21 talks about a proposed consolidation of all the gas companies in the Haldimand field. Various references have been made in the press to a formation of a giant merger of all the canned fruit and vegetable interests of eastern Canada. The Hamilton ' Times ' of March 2 deals at Some length with this merger. The Montreal ' Star ' of February 16 refers to an alleged combine of four of Cobalt's richest silver mines. The Toronto ' World ' 'of December 30 refers to an amalgamation of the leading electrical machinery construction companies in Canada for the purpose of avoiding future cutting of prices. The Montreal ' Star ' of December 19 refers to the big works of the Toronto Bolt and Forging Company, Limited, at Sunnyside and Swansea, employing some hundreds of men, and said to be the centre of a big consolidation that will represent at least $1,000,000 of invested" capital. The Toronto ' Star ' of February 11 talks about several navigation companies alleged to be forming a consolidation. The Toronto ' Globe ' of January 21 refers to a combine in the asbestos trade. The same paper of February 24 refers to a combine among some of the Montreal railway and power companies. The Montreal ' Gazette ' of January 26 refers to mergers of the various properties of the Canadian Electric Company, the Quebec Railway, Light and Power Company, the Jacques Cartier Light and Power Company, the Frontenac Gas Company, and the Quebec Gas Company. The ' Mail and Empire ' of February 1 has a reference to a merger in the fish business on the Atlantic coast. And another reference to that merger is made in the Toronto * Star ' of February 16. The Manitoba ' Free Press ' of December 1 speaks of a grain combine among the grain dealers. Mention is also made in the Toronto ' Star ' of February 11 of an alleged combine among Canadian insurance companies, and the Manitoba ' Free Press ' of December 11 also takes up that question.


George Gerald King: [DOT]eery low. point. With the advent of the modern refrigerator, experience has demonstrated that during this surplus period perishable product can be purchased and stored for later marketing. It has been found that well selected and well stored product, with improved transportation, permits of the shipment of such products to remote markets hitherto little considered. The inevitable effect has been to establish higher buying prices for butter, eggs and poultry during periods when under earlier conditions they broke badly in price. Through these conditions producers have secured much higher prices. Such results are inevitable, indeed, the whole cold storage and refrigerated transportation policy of the present Minister of Agriculture has been * conceived to this end.
The opening of the Northwest and the inrush of new settlers, and the development of the mining camps in New Ontario, have increased in a very remarkable way the demand for farm products in this ' province. Years ago when fowl were abundant in the fall of the year, they were disposed of in large quantities upon this market and Montreal, through commission houses, and sometimes at very cruel prices. They were badly bandied and badly sold. The result was that notwithstanding handsome profits to the retailer, consumers secured poultry for two or three months in the year at very low prices. Now large dealers have their agents through the country instructing farmers how to dress their poultry or are themselves dressing it for them. The market which they first secured for such product was in Great Britain. This year not one bird has been shipped there, hut all the surplus has gone to the Canadian Northwest. I know of one firm alone who made a contract to deliver 42 carloads of poultry for shipment west, for distribution from Winnipeg to the British Columbia coast.
It is noticeable that in this presumably producing country, we have practically no surplus butter for export. By reason of the marked improvement in the quality of butter through manufacture in creameries, the consumption at home has greatly increased. In addition there has been the added demand from New Ontario and the West. The consumption of milk, too, in big towns and cities, owing to the great increase in the use of cereals, has taken cream which otherwise would have gone into butter. A few yeare ago tens of thousands of cases of eggs were exported to Great Britain. During the past years not one case was sent out of the country. All were required for home consumption, the added demand coming from the West and the mining camps in New Ontario.
The real situation in Ontario is that new markets of large dimensions have recently been opened for her products in the West, with its new settlers and railway,construction, and the mining camps in New Ontario. At the same time a greatly increased outlet has developed in the towns and cities of the province, by reason of the steady increase of the non-productive population.
I think this letter states very clearly what has been one of the causes of the improvement of the condition of the farm-Mr. KING.
ers of this country which has helped to make more profitable some of the business in which the farmers have been engaged. But, there have been other factors that have helped to take away in part some of the advantages which the farmers would otherwise have had. The greater difficulty of securing farm labour and the higher cost of labour have taken away much of the advantage which perhaps the farmer would have gained from the better arrangements described in this letter. However, the important point to consider is that much of the increase in prices that has taken place is simply an index of the greater prosperity that has resulted from a better policy in the interest of the farming community of this country.
There are other causes that have also-contributed to the rise in price. First of all, we/ have the great extravagances of tl)e wealthy class. Under the conditions of development and expansion described, opportunities have been afforded to investors, to the possessors of great natural resources, and to those who have had to do with their development and the distribution of products and produce, a means of acquiring wealth such as comes but seldom to a people in the life of a nation. Unfortunately, the riches thus reaped do not always become generally distributed; while the prosperity is real enough, it somehow seems to converge into the hands of a few. This-wealth so suddenly, and in many cases so easily acquired, has given rise, not infrequently, to standards of living to which its possessors were strangers a few years before. Money easily obtained has been lavishly displayed and spent, sometimes on more and better food, sometimes on moTe and better clothes, often on more and dearer luxuries.
This extravagance of the rich considered in all its bearings, and in particular of what it has demanded of its host of imitators, has done much to enhance the cost of living. Wealth centred in the hands of the few has helped to determine the price at which the many have been obliged to pay. The result has been that through the extravagances to which I have referred, we have come to have large demands for certain classes of commodities that are not commodities that are produced for the mass of the people, and capital which would otherwise have been invested in those things in which the mass of the people are more interested has been withdrawn from those occupations and been put into such-businesses as making automobiles and the like in order to supply the demand -of those who have become very wealthy. It is in this sense that it has been well and truly said that the high cost of living is the cost of high living or the cost of living high. So much by the way of general statement.
To examine in a more critical and scien-

tific manner the causes of the increase in the rise of prices, it is necessary to consider first, what prices in reality are. Rightly understood they are the value oi commodities in terms of gold. It follows, therefore, that whatever effects the relation of commodities to gold in the matter of supply or demand of either of these factors will have its effect upon prices. Prices are the result of an equation of which commodities and gold are the two factors; an increase in the former relative to the latter means a lowering of prices, an increase in the latter relative to the former an increase in prices. That the supply of gold has vastly increased is a matter of statistical record. That this increase relatively has been so considerable as to affect prices is the belief of many leading economists, among the number such eminent financiers as Sir Edgar Speyer, who recently paid us a visit, and such eminent authorities as Professor Taussig, of Harvard; Professor Fisher. of Yale, and Professor J. B. Clarke, of Columbia. In fact, there is practical unanimity as to this being one of the main causes.
When we look at the gold side of the question, we find that the total gold production in the world has been doubled in the last decade, and that ten years ago it was practically double what it had been ten years before that again. Against the increasing production there is, of course, to be placed the increased amount of gold necessary to meet the needs of a population vastly larger, and further, the large amount of gold consumed in the arts, though the increase in the amount of gold used in the arts is, I understand, estimated by the best authorities to be considerably less relatively to the amount in use as a medium of exchange.
This is a circumstance of course which sooner or later comes to affect all countries alike, for the flow of the precious metals is such that though invisibly and imperceptibly, they gradually tend to find their level in all parts of the world. This cause may account for relative increases over periods of time, but the causes which account for actual prices in different countries are necessarily of a different nature.
There is, however, a further influence closely associated with the production of gold, which, however, is more impalpable and incalculable, and which comes into play in the shape of credit, by virtue of which one comparatively small quantity of gold does duty for vast movements of currency. The service which credit can render in this connection is enhanced in this country by the splendid system of branch banks which extends throughout the country. Credit, of course, rests primarily on confidence, which in turn, is has-' ed upon the actual or prospective wealth. The extent to which credit is likely to play
a part in affecting prices will depend upon the degree of confidence m the business community. The whole level of prices will be found at intervals to be swayed according to the confidence or timidity of purchasers and investors. The rapid recovery from the panic of 1907 is attributed by many to the increased confidence which this increased organization has been able to produce.
Leaving now the gold and credit side of the equation, and coming to the commodity side, there are a variety of causes connected with the demand and supply of commodities all of which have their effect upon prices, Everything that enhances the demand, the supply remaining the same, is likely to increase prices; everything diminishing the supply and the demand remaining the same will have the same effect.
I have already made mention of the extravagance of the rich, and the increased ostentation in display, in some respects the criminal extravagance ot our wealthy classes, and the great luxury, and higher level of living of all classes. Within a lifetime the scale of living in North America particularly in towns and cities has beep revolutionized. The luxury of yesterday has become the necessity of to-day. For the very wealthy take automobiles alone. What is believed to be a fair estimate of the output in the United States for one year is 160,000, while the output for the past seven years is placed at over 400,000.
But to come to the standard of living of the average man. Our homes are more commodious, and better furnished than they were, equipped with all manner of conveniences unknown to our fathers. Electric light has taken the place of the kerosene lamp, furnaces have replaced box stoves; we travel, not on foot, but by electric car; children enjoy educational advantages which were not within the reach of their parents. Much shopping is done by telephone. Proprietary goods have taken the place of staple food products. Amusements and diversions have gained a hold on the people which they did not possess before. As a slight but forcible illustration of the difference in standards, let me mention one fact brought to light by the prices investigation conducted in the Department of Labour, to which I have already referred. The inquiry shows ,that there has been a' marked 'lifting' of the popular taste in the matter of _ cotton goods. Some coarser lines of goods' which * were in demand twenty years ago are not now manufactured at all, there is no demand for them; the class buying such goods twenty years ago, now buy goods of better quality. The present goods cost more than those of the past, but they are as a matter of fact in most cases of considerably better quality. Unquestion-

ably a change in the standard of living has been brought about with the large increase in our scale of expenditure, an increase which the credit system has helped to enhance.
Intimately associated with the higher or more luxurious standards of living are the changed habits of the people resulting from and in marketing and distribution. To refer to only one we should denote the falling into disuse in all our larger cities and towns, of the old, central markets, and the necessarily increased cost of retail food distribution. Where purchases are made direct from the purchaser the additional middleman profit does not play so important a part, but where goods, are delivered not only at one's door, but in preserved or canned form, some increase in price1 to meet the extra cost of service alone is inevitable. The fact that all retail trade is based on direct purchase from the producer must, unless the purchaser in the first instance is demanding too excessive a profit, entail some enhancement of prices. There are but few commodities to-day as compared with fifteen or twenty years ago, which householders purchase in any way other than through the retail dealer.
Particularly important in this country, however, is the other cause which has already been mentioned, namely, increased poipulation, including immigration, and in this connection the increased demand for goods in remote, and inaccessible parts. Increased population means an increased number of mouths to fill; settlement in remote districts means increased difficulties in satisfying existing needs. Products have to he brought long distances, involving additional elements in handling, transporting, packing and commissions to middlemen.
Those causes are self-evident, but arising out of them are causes of even greater potency, though not as apparent at first blush. The estimated population of Canada according to the census of 1901 was 5,371,315. The estimated population at the beginning of the present year was over 7,000,000, an increase of approximately 33-75 per cent in less than ten years.
But what- is even more important as accounting for the increased demand which has effected prices, is the enormous expenditure in connection wfith industrial expansion which has been going on, expenditures made verv largely out of borrowed capital on railways, towns, public works, and other large undertakings. Corporations and governments, national, provincial and municipal have been particularly borrowing for investment or at least for expenditure in the country. According to Mr. B. E. Walker of the Canadian Bank of Commerce, the amount of foreign capital invested in this country in the year 1909, amounted to $200,000,000. Many of these enterprises have not yet become productive, hence they affect Mr. KING.
almost exclusively for the present, the demand side of the equation. The demand has been in the first instance for the materials consumed in the actual undertaking, then for the labour, and the commodities necessary to supply the labourers engaged upon the work, but the circle of industrial and trade activity once set in motion has gone on widening until it has reached all but the outermost edge of the community.
Reference has been made to farm labour. In that connection, one might quote many statistics to show just how considerable has been the increase in the cost of farm labour. But the increase in the cost of farm labour is only part of the general increase in wages throughout the Dominion. I have here a statement prepared in the Department of Labour, showing the rates of wages prevailing in the building trades in different cities of Canada from 1900 to 1910. In the city of Halifax, taking only the building trades, it would appear that the wages have risen for the different classes of labour in the building trades for those 10 years from 7 per cent to 424 per cent, depending on the particular class affected. In St. John, the increase has been from 10 per cent to 42 -6 per cent. In Montreal, it has been from 24 per cent to 834 per cent for one class, the,average being about 66 per cent for some of the higher classes. In Toronto, the increase has been from 16 per cent to 45 per cent, in Winnipeg, from 11 per cent to 64 per cent, in Regina from 25 per cent to 50 per cent, in Calgary, from 25 per cent to 68 per cent, in Vancouver, from 25 per cent to 66 per cent. These figures, taking all the classes in the building trades for these different cities, considering percentage of increase in wages, go to show an average increase of from 26 -6 per cent to 55 -9 per cent in the several localities or an average of 39:4 per cent, taking the whole, And with this increase in wages has gone a shortening in the hours of labour. Of course, the wage question and the price question are very closely associated. The increase in prices has made the working classes feel the necessity of getting an increase in their wages. They have the smallest income, and with the increase in -prices brought about in this way they have had to supplement their earning capacity in some way, and ^so there has been this increase in wages throughout the building and all trades in Canada. On the other hand, the increase of wages has operated to increase prices. The employers, having to pay more for labour, have found it necessary to tack on something to the prices at which they were selling the goods, and so the two things, wages and prices, have followed each other in what has been described as an upward spiral relationship in 10 years. This in-

crease in wages in towns and industries has operated again on the wages on the farms. Wages being on such a high level in the cities men have left the farms to go into the cities, and in doing so they have not only diminished the supply of labour on the farms, but have created an extra demand in the cities for the produce which the farmer turns out, and in that way the farmer has been handicapped in part from two sides. It is really startling when we consider all these things to see how, while we have had all this great increase, this rise of prices in the city, this increased prosperity for different classes, the movement in some parts of the Dominion has been away from the farms into the cities. We have been getting more men on the land in the west. But let us take Ontario. Mr. James, the deputy Minister of Agriculture in Ontario, recently prepared an estimate of the population of the cities and towns of the province, and he estimated that while the population of the cities and towns had increased during the past decade by 295,400, there had been an actual decrease of 61,858 in the rural population. The rural population of Ontario decreased from 1,108,874 in 1899 to 1,047,016 in 1909, while during the same period the population of the cities increased from 901,874 to 1,197,274. Those figures of themselves would help to explain part of the difference of one of the causes of the rise in prices, and help to answer the question as to whether the farmer has or has not really gained all the advantage which has come from increased prices.
Mr. BL4IN- That is not a new condition of things as I understand it. The former census showed exactly the same thing for Ontario for the last 35 years.


George Gerald King: That would only go to emphasize the significance of that fact. If the farm labour had become relatively less in the previous years, it would, of course, intensify any effect which a reduction in farm labour at the present time would have.
There are other causes which might be mentioned also. There are causes which in the long run are going to be of great service to the mass of the people. For example, the widening of markets in different parts of the world. European countries were formerly receiving much of their grain from other countries than Canada; to-day they find the supply in these countries diminishing, while the demand is increasing at home, and they are looking to this country to supply them with the necessities of life in a larger measure than ever before, and with improved transportation and cold storage facilities, with commercial agencies scattered about in the world, the general policy of trade development which the government has taken up, there is bound to be a greater demand for the goods of this country, and as the demand becomes greater, naturally the prices, for the time being at least, will soar a little higher. But I think so far as the increases may be due to causes of that kind, it is an increase which is shared in by the comunity generally, and it is a price which I believe every citizen of the Dominion is prepared to pay as long as he can be assured it has been brought about through such legitimate causes.
There are other causes which might be mentioned, exceptional in their nature, such as the large expenditures in the last few years in connection with war and the preparation for war in different countries. We have had in the last decade three important wars, the Russo-Japanese war, the Spanish-American war, and the South African war. All of these wars have caused a large amount of capital, which might otherwise have gone into productive industry, to be diverted from it. And the expenditures and preparations which different nations have been making in the last few years in the way of preparations for war have also helped to remove from productive uses a certain amount of capital which might otherwise have been productively employed. Of course, one nation doing one thing necessitates a like action on the part of another, and in that way one nation cannot hope to escape part of the general toll which all nations are helping to exact.
That brings me to one other class of causes. The causes which I have mentioned are largely . natural causes operating in accordance with the general run of things throughout the world. There are two classes of causes, closely associated, though somewhat different in kind, which I shall describe as artificial, because they are not absolutely necessary from one point of view although they may be of very great service from another. These causes are the tariff and the combines. The tariff undoubtedly contains the possibility of increasing prices, in this way, that it limits the field of competition over which the sale of goods may take place. _ If by a tariff wall you exclude commodities up to a certain point, naturally the possibility will arise of an increase in the price of some commodities produced in the country within the tariff wall. It does not follow that this will necessarily in the long run be injurious or harmful to any one; the effect of a moderate tariff, may be to so stimulate industry generally that in the long run the people will be better off, having regard to their condition, than they weould be without it. I do not want to argue at the moment the advantages of tariff pro and con, but only to point out that we have on

this side of the Atlantic, so far as the United States and Canada are concerned, prices ranging at a much higher rate than they do in a free trade country like Great Britain, and the difference while not wholly attributable to these causes may be due in part to them, and this is one factor that should be considered. One feature that should also be considered is that where you limit competition from without and manufacture is carried on within by only a limited number of producers, a very strong inducement is nut in the way of the men controlling these industries to unite their forces and to see that they get to themselves as far as they can, the full benefit of any increased price which the tariff may permit. A large number of persons have tue impression that, the tariff in this way has become responsible in part for the formation of these trusts and combines, and a large number of persons feel that what the trusts and combines have done has been to seek to gather within their own group the industries that are protected, and then to take care to see that the full advantage which the tariff gives them goes to themselves as a consequence. What we are seeking to do in this measure is to see that where an advantage comes to an industry through the tariff, the whole of that advantage shall not necessarily accrue only to the persons who are engaged in the manufacture, but that some of it should be reserved for the general public in whose interests, as a whole, the tariff has been framed.
That brings me then to the other phase of this question. I hope I have shown that this legislation, in so far as it relates to prices, is not based on a belief that trusts and combines are the sole causes of the increases in price that have taken place. The most that is urged in that connection is that .trusts and combines may have caused and possibly are one of the causes in some cases for the increase in price, and if that can be shown in any direction, then the government, in view of the general feeling throughout the country, owes it to the community to give some means of finding out whether such a cause actually exists or not and if so of providing the necessary protection to the consumer.
_ Another point I would like to make clear is that trusts and combines may not be infurious, that in some respects they may be profitable. That is a point that has been raised. This legislation is in no way aimed against trusts, combines and mergers as such, hut rather only at the possible wrongful use or abuse of their power, of which certain of these combinations may be guilty. To illustrate the possible advantage of these large combinations of capital, I shall quote an advertisement Mr. KING.
which I find in one of the local papers, relating to what is sometimes spoken of as a combine, the Canada (Cement Company, Limited. I find in the ' Citizen ' of December 11, 1909, the following advertisement:
WHAT IS THE CANADA CEMENT COMPANY, LIMITED?
Then it describes it as:
an amalgamation of eleven of the twenty-three cement plants as follows:-(enumerating them.)
It continues in large letters:
Note the territorial distribution of these plants-from the St. Lawrence to the Kocky Mountains. Obviously in a business where the demand extends from ocean to ocean, there are economies in filling orders from the nearest available plant instead of shipping half across the continent. This explains one purpose of the organization of this company.
Clearly what is stated in the advertisement is absolutely correct. There are obvious economies in filling orders from the nearest plant instead of shipping half across the continent. But the question the country is asking is: Where have we seen of the result of that obvious advantage? That is one of the questions which we hope this legislation will help to answer. In the Ottawa ' Citizen ' of December 14, 1909, other advantages are set out in an advertisement headed:
Useful vs. useless competition.
It says:
But there is a form of competition that, is wasteful, useless and harmful. To illustrate from our 'own business. If each of eleven cement mills maintains selling agencies in every part of Canada and ships its products to the most remote points, the aggregate cost on this score is obviously greater than if there were only one selling organization, and all orders were filled from the nearest mill.
Who pays the cost of excessive competition? Ultimately the consumer must pay it. Eliminating the excessive cost of this wasteful competition will enable business to he done at a reasonable profit with ultimate savings to the consumer through reductions in price.
These are obvious examples of the good which large consolidations of that kind could bring with them, and I think that if the public find they are getting some of the benefits of these obvious and inevitable consequences of large organizations, they will take no exception to them; but they want to feel sure that the machinery exists somewhere whereby they can be assured that they are getting, within reasonable bounds, some of the advantages -which are so inevitable.
The Hamilton ' Times,' referring to the alleged projected merger to be known as the ' Dominion Canners' Association, Limited,' has the following:

In regard to the object of the merger, it is said by the manager of the Canadian Canners' Association, that the purpose is to keep the cost 'of productoin down, by which the consumer would also benefit. One of the reasons of the merger, is, he said, that competition had greatly affected the trade, the race having been for the cheapest product, but not the best. That would be overcome as more advanced methods would be applied and only the best .produced, so that the public would be assured of the quality of what they received.
Similarly, an article in the Toronto ' Globe ' of January 31, referring to the new combine to be known as the Amalgamated Asbestos Corporation, Limited, has the following :
One of the chief aims of the association will he the exploitation of the use of asbestos in fireproof construction.
There is no doubt that these large organizations have opportunities of furthering the business in which they are engaged that would not be open to a smaller concern. They have facilities to get into otheT markets, and if they use those facilities in such a, way that the general public get some benefit out of it, as well as the organization itself, the public antipathy to them should, be greatly lessened.
An article of the Toronto ' Star ' of February 16, referring to the alleged combine of large firms engaged in the fish business on the Atlantic coast, has the following:
The authorized capital of the new company will be $1,000,000, and it will aim to make the fresh fish business of Nova Scotia of national importance. The Bank of Montreal is behind the scheme, aud controls the Atlantic Fisli Company.
Clearly it is the interests of the fish trade on the Atlantic coast to in every way get for its product as large a market as possible. The more the fish business is developed in the maritime provinces, the better it should be, other things being equal, for the people of these provinces, and the more you look into the question of these organizations the greater the reason for belief in the possibility of good to the consumer provided there be some means of effective control.


Mr. HODGINS.: The hon. gentleman mentioned the Canada Cement Company. I might say that in November last the International Cement Company of Hull were charging $1.50 per barrel of cement delivered at the railway station in my place, but as soon as the merger was formed the price was raised to $2.09 per barrel. I simply mention this in order to draw the attention of the House to the effect which such mergers are likely to have.


George Gerald King: That information has come to me from other sources. In speaking with some gentlemen associated with this merger, they contended that the cement 217
people were being much misrepresented in popular opinion, and that if the public could see what had taken place, they would be perfectly satisfied that no unfair profits were being charged. I propose to let any compa.ny which has reasonable ground for believing that the public is under a misconception have the facts brought out so that the public may be in a position to form an accurate opinion. If the consumers feei that they are not getting justice, we ought to give them an opportunity of finding out whether or not the facts justify their beliefs. These are some of the advantages claimed for the trusts, and it will be to the public interest that, in cases where the public consider they are not being fairly treated, the evidence as to the facts should be made known.
Perhaps no one has given a more thorough study to the whole question of trusts and combines than Mr. Jeremiah W. Jenks of the United States, professor of Cornell University, and who for some years was an expert agent of the United States Industrial Commission. Mr. Jenks has also been engaged in several important investigations for the American government. On this question he is recognized as the leading authority on this continent at present. In his book entitled ' The Trust Problem ' he states what are the main advantages of trusts, and in considering this legislation it would be well to place his views on record in order that the public may not be mistaken as to the attitude in which this matter is being approached by the government. On pages 212 and 213, Professor Jenks says:
Combination saves a waste of capital by tlie prompt abandonment of poor or badly situated plants and the concentration of energy in the best ones which can be run to their full capacity and all of the time; by making the best possible use of waste material through the production of by-products; by pushing, often at much expense, markets into new fields, both at home and abroad, through the employment of the ablest men and the best advertising devices, which could not so well be afforded by smaller institutions. There is great saving of energy in the elimination of cross freights; in the best possible division of labour, and in the organization of correlated branches to the best advantage; in the securing of the best ability to manage industries; in making the best distribution of managing ability, giving each person the work for which he is best adapted; in furnishing opportunities fit for the employment of the greatest capacity in all fields of business management, opportunities which could not be furnished without the enormous power that comes from the concentration of capital.
Similarly another authority on Trusts, Mr. Wm. E. Collier, sets forth the results of his experiences. Mr. Collier is New York state civil service commissioner, and has made a complete investigation into this



phase of industrial development. At page 3 of the preface, Mr. Collier says :
The great advantages of .mammoth business organizations should not be overlooked. Such organizations are necessities in the present condition of American industries. They seem to be the only effective agencies whereby we can develop our much needed foreign markets, whereby we can dispose of our surplus products, and thus give constant employment to our workers and toilers. Much of our anti-trust legislation has overlooked this fact. There is, indeed, a danger that in our attempts to stop monopolies we may cripple our productive energies and stifle enterprise and bring our country into a condition of industrial degradation and into bankruptcy.
The same writer, at page 300 of the same volume, cites other advantages:
We are living in a day of great things. Business opportunities are gigantic, industrial undertakings are enormous, commercial projects are vast, and great, business organizations have become a necessity since the dawn of industry, there has been a constant tendency for them to increase in size. Next, the present system of business is characterized by excessive competition, there seems to be a tendency to carry the struggle of competition to such an extent that it becomes injurious to the consumers as well as ruinous to the competitors themselves. Modern competition is destructive and self-destructive; it has a tendency to end in monopoly itself. Modern competition if often unreasonable, and if it were not for the possibility of unreasonable restraints, agreements for its discontinuance would command themselves to the public as being highly proper. Consolidation and combination render possible cheaper production and infinitely cheaper distribution; the competitive system is so expensive in its operation that the price we pay for many articles is far in excess of the cost of actual production plus what would be a fair profit, if the best and most perfect methods of organization were adopted. There are gigantic evils resulting from the lack of regulation of industry ; consolidation makes possible a better control and will enable those adopting this form of organization to sell goods at lower prices.
If matters were to end there, we would probably have no need for the kind of legislation we are n'ow introducing. The advantages of large combinations of capital are so obvious, that, I say again, if these large combines had regard to the public interest as well as to the private interests of their shareholders, there would be no need of any legislation to watch or control their operations. Unfortunately, human nature being what it is, we cannot believe that these organizations consider primarily the good of the nation as a whole as opposed to the interests of those whose capital is in their hands; and it is the business of the government, therefore, to see that no private interests shall be allowed to operate against the public good. Where, through the development of an industry, or other cause, we Mr. KING. '
have the growth of a great power in the hands of individuals, with the possibility of that power being used to further private ends at the expense of the public good, there is the strongest demand on the government to see that the interests of the community are protected.
I was asked further if we had any reason for believing that any of these combines were operating in a manlier detrimental to public interest. I replied that I did not wish to make any individual charges one way or the other. But the government is forced jto recognize such representations as come to it from reliable sources.	*	.	,
On February 26, 1909, a deputation waited upon the hon. the Minister of Finance, and the right hon. the Minister of Trade and Commerce, with a view to invoking the aid of the government of Canada in the control of combines. The deputation, accompanied by a number of members of parliament, included Mr. F. C. Drury, master of the Dominion Grange; Mr. James McEwing, M.P.P.; Mr. H. J. Pettipeice, ex-M.P.P.; Mr. J. W. Currie, K.C.; Mr. W. L. Smith, editor of the ' Weekly Sun ', and Mr. J. Woods, of Gordon McKay & Co. I shall not read the memorandum at length, but simply say that these gentlemen represented that there was an inevitable tendency, as a consequence of the tariff of this country, towards consolidation in the shape of trusts and combines, and that they had reason to believe that, in a very large number of industries in ' this country, such combines were operating to the detriment of consumers. They cited a number of commodities produced, and went on to state that there were at least one hundred trade combines in Ontario which were collecting in the aggregate millions of dollars per year in the form of exorbitant profits. They also urged that the government should take further action towards the control of these combines, and pointed out that their representations had been also voiced by the newspapers of all shades vof political belief, the Orillia 'Packet'; Windsor 'Record', Woodstock ' Sentinel-Review ', Hamilton ' Herald ', Calgary ' News ', London ' Advertiser', St. Thomas ' Journal ', Moncton ' Transcript ', and that other papers had been particularly outspoken. Organized bodies such as the Dominion Grange, they further pointed out, had also pronounced upon the matter, and, by formal resolution, had called for thq relief which the situation demanded.
Then hon. gentlemen will remember that some few years ago there were certain disclosures in Toronto, arising out of prosecutions which were begun under the Criminal Code regarding a number of combines, which, it was alleged, were then carrying on their business in a manner detrimental to the interests of the people.

I might remind the House of the select committee of inquiry into the question of trade combines appointed as far back as 1888. That committee, during a sitting of two and a half months, discovered the existence of thirteen combines which, it represented, were not operated wholly to the advantage of the people, but were taking a rather unfair advantage of the organizations they had formed. Then we have had in the last few years several cases in the courts in different parts of the Dominion brought against parties alleged to be interested in these industrial combines.
1 might refer to one or two extracts which set out the other side of the case. I have referred to the advantages which these trusts may exercise. Let me now point out briefly the disadvantages. When the subject was discussed some years ago, my hon. friend from East Grey (Mr. Sproule) read from a pamphlet written by Mr. Wm. W. Cook of New York, and I would like to put the extract which he read before the House again as presenting another point of view:
The modern trust is a monopoly in its purpose, its plans and its culmination. It is a combination that strikes down all competitors. The parties combine to control the market and to control it without competition.
To all these the public at each end of the industry, the producer and consumer is, and is intended to be, in a certain sense at the mercy of the syndicate or combination. The main purpose,_ management and effect of all upon the public is the same, to wit: the aggregation of capital, the power of controlling the manufacture and output of various necessary commodities. The acquisition or destruction of competitive properties all leading to the final and conclusive purpose of annihilating competition and enabling the industries represented in the combination to fix the prices at which they would purchase the raw material from the producer, and at which they would sell the product, refined or useful, to the consumer.
Mr. Jenks, in the book from which I have quoted, giving the advantages of these large combines, has given, at page 213 a summary of the disadvantages. In this connection he points out as follows:
Enormous as these benefits to society may be from this better organization of capital under the new regime, no less pronounced are the evils. (1) Investors of capital are often grievously wronged through concealment of facts and deception practised by promoters and directors at the time an industry is organized, and, later, through mis-representation_ of the condition of business and methods in which a business is carried on.
(2) A second class of persons injured is that of the stockholders. Directors not infrequently manage the business in their own interests, regardless of those of the stockholders. At times it is really made less profitable, or is so managed as apparently to be less profitable, in order to depress the stock 2171
on the market and to enable the directors through gambling speculations to reap large profits.
(3) Persons, not members of a corporation, may be injured as consumers by high prices, which can be kept high, provided the combination can secure monopolistic power. The temptation to keep prices above former competitive rates, is, of course, greatly increased when the corporation has issued large amounts of watered stock.
(I) The producer of raw material may be injured by low prices, which the combination, by virtue of its being the largest, if not almost the sole buyer, can compel the producer to accept.
(5)	The combination may so increase its power as to* injure the wage earners by compelling them to accept lower wages or to work under less favourable conditions than would be granted by competing concerns. So, too, the power exercised, apparently arbitrarily at times, of closing part of the plants to avert a strike, or even to affect the stock market, is dangerous.
(6)	It may happen at times that the larger organizations will exert so powerful an influence on our political organizations that the purpose of the state will be directed away from the common weal.
(7)	The mental tone of the business community may be lowered by depriving individuals of the privilege and of the power to enter independently into business as readily as could be done were capital less concentrated.
(8)	And, again, the moral tone of business may be lowered. If the larger organizations employ unscrupulous methods in dealing with competitors, or customers, or labourers, their greater power, especially if it is great enough to give them a partial or complete monopoly for a time, will have a much more detrimental influence than the same acts of an individual, both on account of the range of its application and of the more powerful influence of its example. . . The power of the manager of the large corporation is greater, and the injuries, both economic and moral, to the public from his selfish acts may be much more severe.
So you see, from the extracts I have read, that this writer, who speaks from a very wide range of experience, sees possibility of evil from these large organizations to all classes-investors, stock holders, consumers, producers, wage earners, political organizations and the mental and moral tone of the business community.
It is apparent that no single act can hope to cope with all these possible evils, and the most that can be reasonably expected is that individual forms shall be dealt with as the special need asserts itself. In this legislation it is the interests of the consumer and producer, rather than the interests of the investor or stockholder that it is hoped to protect.
Sufficient has been shown to make quite clear that through large combinations of capital, in the form of corporations of one kind or another, enormous power has become concentrated in the hands of a few

men; that the faculty for forming combinations increases as the scope is narrowed, and that that power becomes more easily wielded as the numbers controlling it become fewer. At the same time this consolidation of power in the hands of a few, has lessened their personal responsibility for the proper use of that power; sense of personal obligation to the community becomes submerged in vast corporate entities. The possible resulting abuses call for some restraint that shall take the place of the old personal obligation. Government supervision and publicity must be that substitute. The man who conducts a small business thinks of the obligation he owes to his customers and to the community in which his small business is carried on. Too often, it happens that engaged in one of these large organizations, the persons so employed think only of their obligations to the corporation which employs them, it is so vast, its demands absorb all their attention. A sense of obligation to consumers or society generally is lost. This makes it imperative upon the government to safeguard the community against undue encroachments on the part of these powerful concerns.
But there is an additional reason for government supervision and publicity at the instance of the state. The .form of organization which enables wealth to become concentrated in the hands of a few, and secures great commercial powers to these few, is itself rendered possible only through conditions created by society, of whose interests the state is the guardian, and by the direct agencies of government itself.
All organization on a large scale is alone rendered possible by the peace and security which the state assures, and in the maintenance of which the heaviest expenditures of government are incurred. Without the concessions made by the public, and guaranteed by the state, the agencies of transportation and communication, the railway, the telegraph, and telephone, the postal service, could not exist for a day, and the fact that personal responsibility, in the case of these large organizations, tends to become less, is a very strong reason why the government should step in and see that something is established in the nature of a control which will bring back that sense of responsibility to the public which every one engaged in any industry should experience and exercise.
I would like to point out the relation which the legislation we are introducing bears to that adopted in other countries. In the first place the government has sought, in the Bill brought down, to avoid some of the limitations which experience has shown to have been prejudical in the case of some legislation adopted in other lands. For example, take the experience Mr. KING.
of our neighbours to the south. The Sherman Anti-Trust Act was introduced about twenty years ago. The United States has had the experience of that legislation for that period of time, and their experience ought to be helpful to us; it ought to be helpful at least in preventing us from making the mistake which they have admittedly made. The great mistake which was made by the Sherman Anti-Trust Act, and a mistake which has been made I think in discussions on the subject even in this House, has been that the measure was aimed against trade combinations as such. In looking over the debates that have taken place in this parliament I find that speaker after speaker has said that these combinations must be stopped, we must put them down, we -must have legislation that will suppress them. Now, that is ignoring altogether the inevitable tendency of the present day, which is consolidation and co-operation of forces, for one cause or another. Section 1 of the Sherman Act reads:
Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several states, or with foreign nations, is hereby declared to be illegal. Every person who 6hall make any such contract or engage in any such combination or conspiracy shall be deemed guilty of a misdemeanour, and, on conviction thereof, shall be punished by fine not exceeding $5,000, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court.
The effect of that legislation was that for the first few years, under the Harrison administration, the courts interpreted the law as meaning, and no doubt that is what the framers had 'in mind, that a combination had to be formed with the deliberate intent of limiting competition against the public interest, and unless intent could be proved, the Act became of no service. Then a decision was given in an important case, the Trans-Missouri Freight Association case, in which the Supreme Court held that the matter of intent was secondary, that all it was necessary to prove was that the combination existed, and that would bring the parties under the law: That interpretation actually made nine-tenths of the business of the United States illegal, and the courts found that unless they were going to make the law ridiculous altogether, it was better to leave it alone. The effect was this, that when it was realized that a trust in the nature of two or three concerns operating together under a joint agreement was an illegal thing, the lawyers at once got to work and said: Let us form 'holding corporations', instead or having these agreements, let us bring our forces to-

gether and have one concern. The result was the, formation in larger numbers than had ever been known before in the United States of these great aggregations of wealth into one concern. Then came the Roosevelt administration, in which the one concern itself was held to come undeT the Sherman Anti-Trust law, and we all remember the experience the United States had in trying to work out the law under that interpretation placed unon it bv the courts in the case of the Northern Securities Company. In effect this decision outlawed every industrial concern of first importance. They tried then to make a distinction 'between the good trust and the bad trust. The administration claimed for itself the right to say that a certain trust was good and really did not come under the Act, and another trust was bad and should come under the Act. This has been the history of that legislation up to the present time. Since President Taft has come into power he has had to be his own interpreter in a measure, and has had to say frankly that the Act as interpreted by the courts would put out of business nine-tenths of the concerns in the United States, and that so far as his administration was concerned they were not going to administer the law according to the interpretation the courts have given it, but according to their own interpretation. Now that is a kind of error which this parliament should seek to avoid; let us not place on the statutes anv act which will necessitate a contradiction between the wording of an act itself and the interpretation of those who administer it.


Robert Laird Borden: I do not quite understand how they administer it on a different principle to that which the courts have adopted.


George Gerald King: They do it in this way. The federal government enters the prosecutions, and the federal government has refused to take up any prosecutions unless its own interpretation is satisfied in the first instance. I will read on this point an extract from President Roosevelt's message to Congress in 1906:
The actual working of our laws has shown that the effort to prohibit all combination, good or bad, is noxious where it is not ineffective. Combination of capital, like combination of labour, is a necessary element in our present industrial system. It is not possible completely to prevent it; and if it were possible, such complete prevention would do damage to the body politic. What we need is not vainly to try to prevent all combination, but to secure such rigorous and adequate control and supervision of the combinations as to prevent their injuring the public, or existing in such forms as inevitably to threaten, injury. . . . It is fortunate that our present laws should forbid all combinations, instead of sharply discriminating between those combinations which do good and those combinations which do evil. ...
There is a curious admission for the chief executive of a great nation, that their present laws forbid all combinations instead of sharply discriminating between those who do good and those who do evil. President Taft found, I think, that he would be undertaking more than he cared to handle in this endeavour to distinguish between good and bad trusts; because in his special message to Congress on January 7, of the present year, he gives his interpretations of the law, and has something to say about distinguishing between good and bad trusts:
The increase in the capital of a business for the purpose of reducing the cost of production and effecting economy in the management has become as essential in modern progress as the change from the hand tool to the machine. When, therefore, we come to continue the object of congress in adopting the so-called ' Sherman Anti-Trust Act' in 1890, whereby in the first section every contract, combination' in the form of a trust or otherwise, or conspiracy in restraint of inter-6tate or foreign trade or commerce is condemned as unlawful and made subject to indictment and restraint by injunction; and whereby in the second section every monoply or attempt to monopolize, and every combination or conspiracy with other persons to monopolize any part of inter-state trade or commerce, is denounced as illegal and made subject to similar punishment or restraint, we must infer that the evil aimed at was not the mere bigness of the enterprise, but it was the aggregation of capital and plants with the express or implied intent of restrain inter-state or foreign commerce, or to monopolize it in whole or in part.


John Graham Haggart: How are you to find out the abuse of the combination?	.


George Gerald King: By investigation, I think investigation is the only way-where there is a prima facie reason for believing that the combination is doing injury, and I can think of no other method of discovering whether that assumption is correct. But I will go into that point later. The President continues:
The object of the anti-trust law was to suppress the abuses of business of the kind described. It was not to interfere with a great volume of capital, which, concentrated under one organization, reduced the cost of production and made its profit thereby, and took no advantage of its size by methods akin to duress to stifle competition with it.
I wish to make this distinction as emphatic as possible, because I conceive that nothing could happen more destructive to the prosperity of this country that the loss of that great economy in production which has been and will be effected in all manufacturing lines by the employment of large capital nnder one management.

Elsewhere:
It is the duty and purpose of the executive to direct an investigation by the Deoartment of Justice, through the grand jury or otherwise, into the history, organization, and purposes of all the industrial companies with respect to which there is any reasonable ground for suspicion that they have been organized for a purpose, and are conducting business on a plan which is in violation of the anti-trust law. The work is a heavy one, but it is not beyond the power of the Department of Justice, if sufficient funds are furnished, to carry on the investigations and to pay the counsel engaged in the work.
So that the United States, after an experience of twenty years, has come now to the conclusion that the only manner in which to deal with large combinations, as President Taft says, where there is any reasonable ground for suspicion that they have been organized in a manner which violates the anti-trust law, is to investigate and find out whether or not, as a result of that investigation, the suspicion is well founded:	[DOT]
Many people conducting great businesses have cherished a hope and a belief that in some way or other a line may be drawn between ' good trusts ' and ' bad trusts/ and that it is possible by amendment to the antitrust law to make a distinction under which good combinations may be permitted to organize, suppress competition, control prices, and do it all legally if only they do not abuse the power by taking too great profit out of the business. They noint with force to certain notorious trusts as having grown into power through criminal methods by the use of illegal rebates and plain cheating, and by various acts utterly violative of business honesty or morality, and urve the establishment of some legal line of separation by which ' criminal trusts ' of this kind can be punished, and they, on the other hand, be permitted under the law to carry on their business. Now the public, and especially the business jiublic, ought to rid themselves of the idea that such a distinction is practicable or can be introduced into the statute.
At one o'clock, House took recess.
House resumed at three o'clock.


George Gerald King: When the House adjourned, I was referring to the legislation affecting trusts and combines in other countries and speaking more particularly with reference to legislation in the United States. I shall spare the House a detailed description of legislation in other countries. I "would briefly mention that in England trusts are held to be illegal only where competition is shown to have been wholly removed or prices raised excessively. In such a case the combination is antagonistic to the English conception of freedom of trade, and is *consequently judged as void. From this it follows that the decision, whether the com-


George Gerald King: bination has the force of legal contract or not, depends according to the English court upon the merits of each case. But while the law in England and on the continent has left the development of trusts to be shaped by economic conditions, it is guarding more and more closely the incorporation and supervision of corporations.


John Graham Haggart: In England can you not punish a corporation for enhancing prices?	'


George Gerald King: By common law.


John Graham Haggart: Forestalling the market.


George Gerald King: the truth known may be represented on the board of investigators. In the first place, the parties who have preferred the complaint will be asked to name their representative, the parties complained against will be asked to name their representative, and these two ^ representatives, chosen in this fashion, will be called upon to choose as the chairman of the Board of Investigation, a judge of some court. In the event of either of the parties failing to name an individual member of the board, or in event of the two members failing to agree upon a judge as chairman, then the government will make the appointment of the person needed to complete the board. In this way it is hoped to fashion a board of investigation composed of experts from both sides, who will have the power to- examine into all facts having a bearing on the case, and to make their report. The essential feature of this measure is that it provides this means of getting at the truth before giving publicity to the facts, it has an important industrial and social bearing, its machinery is simple, and it has been constructed with a view to being absolutely fair and impartial to both sides. ***** fs a result of an investigation by one of these boards, it is shown that a combination exists and has operated in a manner adverse to the public interest, the measure provides certain remedies which may ,apPliedi and I think it can be shown - "hat by the machinery provided by this legislation any limitations or defects which are to be found in the law as it stands today will be supplemented or rectified.
It is now desirable to briefly outline the place which this legislation holds in the scheme of legislation already devised by this parliament to deal with the evil or possible evil which this measure seeks to remedy. This will occasion a brief historical retrospect. In the speech from the throne it was stated that the legislation to be introduced was to render more effective existing legislation. If we omit such legislation as has to do with the control of railway rates or the like, and confine ourselves to that which has been aimed more particularly at combines, trusts, etc., this legislation will be found to be embraced in sections 496, 497 and 498 of the Criminal Code. These sections embody the legislation enacted originally in this parliament in 1889 for the prevention and suppression of combinations formed in restraint of trade. The next legislation is the combines clause in the Customs Tariff Act, assented to on June 29,	1887, as
amended by an act respecting the duties of customs of 1907, 6-7 Edward VII., Chap 11, assented to on April 12, 1907; and lastly, there is an Act to amend the Inland Revenue Act, 4 Edward VII., Chapter 17, assented to August 10, 1904.
Many members of this House will re-Mr. KING.
member the interest taken by the late Mr.. Clarke Wallace in the subject of trusts and combines. When he was a member of this House he brought the question up, and at his instance a select committee of the House of Commons was appointed to take evidence on the question and to examine into the need of legislation on the subject. That committee did its work in a very effective and thorough manner. I think Mr. Wallace was the chairman of the committee, and great credit is due to him for the exceptionally able and thorough way in which the inquiry was conducted. A large number of witnesses were called and examined, and a report, a copy of which I hold in my hand, of between 700 and 800 pages, was presented to the House. The interesting feature of that report is that although the committee sat for only two and a half months, they were able during that short time, to disclose to the country the existence of some thirteen different combines. I will not read what the report has to say, but hon. members will find it worth their while to peruse this report and to see just what the results of investigation in this way are likely to'be. No stronger evidence in support of the measure which the government is bringing down at the present time could be had than is. to be found in this very report. After all, the essential work of that select committee was investigation. In their report the committee were able to put out something pretty substantial. Not only that, but an examination of the report will show that while the committee were at work, some combinations which were believed to be operating to the detriment of consumers in this country ceased their operations to avoid the publicity which an examination before that committee would entail. It was also shown by Mr. Wallace, when he spoke on the subject in the House the following year, that a combine which had existed during the time the inquiry was taking place, as a consequence-of the publicity givefl through that inquiry, ceased to keep up its prices unduly. If we refer to page 5 of the report of this committee, we shall find' that they found that a large combine Existed among coal dealers-in both Ottawa and Toronto. Speaking of the results of this investigation on the second reading of the Bill, Mr. Wallace said:
We find that these coal organizations are still in existence, we find the organization m Toronto and we find it in Ottawa, but in Ottawa public opinion has been brought so strongly to bear that coal which was sold ft $8-50 a ton during the whole winter of 1887 and 1888 was sold at about $6 or in some cases $5.75 a ton during the present winter (1889). We know that the price of coal in the United States was almost the same this year as last year, and that the cost of freight was almost precisely the same, and the fact of coal being sold in Ottawa for at least $2.50 per ton less shows either that the deal-



J2. 1910

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ers were very magnanimous or generous this year, or that they were robbing the public last year.
It is to be noted that there-were no prosecutions in this connection. The result was brought about simply through the force of the report of the committee of the House of Commons influencing public opinion; and it is to be noted further that Mr. Wallace credits public opinion with the whole result.
A word as to the significance of the sections in the Criminal Code which come down to us from the legislation introduced in the House by Mr. Clarke Wallace in 1889. Gentlemen opposite may be inclined to assert that much credit is due to the party to which they belong from having been the first to enact legislation to deal with trusts and combines. I am prepared to concede high praise to the late Mr. Clarke Wallace for the earnest, and diligent manner in which he helped to bring this subject to the attention of parliament, and the country, and in particular for the able manner in which he presided over a special committee appointed by the House on his recommendation, to inquire into the nature, extent and effect of certain alleged trade combinations. This committee appears to have done its work expeditiously and thoroughly, and no stronger case could be made out for the desirability and advantage of investigation as a means of dealing with combinations and trusts, or of the effects of publicity in desiring to remove the evils incident to these large organizations than the work and report of this committee. It [DOT] might have been expected that as a result of this inquiry and all that it revealed of the merits of investigation, and publicity alike, the government of the day would have seized the one obvious conclusion of the whole inquiry, and have brought in a measure making provision for the exercise, as future conditions might require, of these powers of inquiry an8 publicity which had proved so effective in the inquiry and publicity which had proved so effective in the inquiry just concluded. Instead of this, however, the government contented itself with the measure which has come down to us as part of the Criminal Code.
In regard to this measure, it is to be noted that in reality it enacted nothing new, but was merely declaratory of the law as it stood, and had stood for years before the question had ever been one of concern to the administration. This was very clearly brought out by the late Hon. David Mills, at that time member for Bothwell, and who subsequently became Minister of Justice, and I must add was as clearly, and candidly admitted by the late Honourable Sir John Thompson, the then Minister of Justice, who had charge of Mr. Wallace's Bill.
Referring to ' Hansard,' page 1437 of the debate which took place on April 22, 1889, it will be seen that Sir John Thompson spoke as follows in reference to the Bill:
I think it is, as the honourable gentleman (Mr. Mills) has said, mostly declaratory of the common law. ... It frequently is the case to declare the common law with respect to matters which are offences	
I have said candidly to the honourable gentleman who has had charge of this Bill from the first that I think his Bill, as now framed, would add no new penalty, no penalty which could not already be inforced, and will not create any new offence.
So far, therefore, as the contribution by gentlemen opposite to legislation affecting trusts, combines, monopolies, and mergers is concerned, it might be well to keep in mind the words of the late distinguished Minister of'Justice and Prime Minister that it added ' ho new penalty, no penalty which could not already be enforced, and will not create any new offence.'
But if I were to go further and examine more closely the effect of this legislation, I would be forced to argue that it is at least questionable whether its existence on the statutes has not operated rather as a protection1, or shield to individuals in their endeavours to make unfair exactions from the public and consumers through the medium of large organizations of capital in the nature of trusts and combines; that, instead of being a deterrent factor, it has actually served as an aid to the possible machinations of these powerful concerns. It has done this by succeeding in large measure in stifling investigation and publicity, the first of all essentials in arriving at the existence of improper practices and methods, and of effectively restraining them.
That Sir John Thompson 'was right in his opinion at that time was apparent when the subject came up for discussion some years later. The hon. member for Bast Grey (Mr. Sproule), in moving the first reading of his Bill of 1899 to amend the combines clause of the Criminal Code, said that he was seeking these changes:
For the simple reason, we are told, tliat it would be iaipossible under the existing law as it stands to secure a conviction of any persons guilty of combining in restraint of trade. It would put upon a prosecutor the onus of proving a great many things which it would be very difficult to prove. How can one prove what undnly enhanced the price or restrained trade. .	.	. This law has
been . on the statute-book many years, and efforts have been made from time to time to get the attorneys general of the provinces to prosecute under the Act, and several times applications have been made to private individuals to do so, and they all raise the same objection that it would be impossible to secure a conviction under the law as it reads.
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The hon. member might have quoted at that time as a true phophecy the words of the Hon. Sir Mackenzie Bowell, who, in speaking on July 17, 1889, on the proposed amendments to the Criminal Code, said:
You are enacting a law which, like some Pjmers, will he very harsh in its character it literally interpreted, and will, therefore, become a dead letter.
I think I have shown the House that the legislation of 1889 has not been effective in dealing with the evil of trusts and combines, but that, on the contrary, its real effect in some cases has been to prevent investigation which would otherwise have taken place. The necessity of branding as criminals any body of men joined together for commercial purposes before you find out whether or not they have been guilty of a criminal offence, is a step which many a man will hesitate to take, no matter what grounds he will have for believing such men to be guilty of a public wrong. There is no doubt that this necessity has .prevented many an investigation which would have been in the interest of the public. Therefore, this measure does not propose to place these parties in the position of defendants in /a. criminal court, but treats them as persons whose business for the time being is being examined into just as is the business of a railway company or a bank to-day to see whether or not it is being carried on in a fair and proper manner. '
I will hot say any more with regard to the sections of the Criminal Code, but will pass on to the next step in legislation by this parliament. In 1897, just a year after the present government came into oflice, new legislation was enacted in the tariff resolutions. That legislation is to the effect that whenever the Governor in Council has reason to believe that a trust, combine or association exists among manufacturers, which is unduly enhancing prices, he may appoint a judge to conduct investigations into the business of the alleged combines; and if it be found that a combine does exist and is benefiting by the existence of the customs tariff, at the expense of the public, that the tariff may, either in part or in whole, be modified so as to offer to the consumers that redress to which they are entitled^ This legislation marked a very material step forward. There are certain evils which, it is. easy to believe, can be better removed by publicity than by penalty. There can lie no doubt also that, in many questions of this sort, the bringing to bear of a certain amount of publicity cannot fail to have a beneficial effect. Therefore^ the legislation of 1897 looked rather to the interests of the consumer than the punishment of the wrong-doer for a particular class of wrong-doing, and from that legislation we have had some beneficial results. The House will remember that a few years Mr. KING.
ago the Canadian Press Association claimed that there was existing among the paper manufacturers and dealers in this country a combine which unduly enhanced the price of paper. That complaint was brought to the attention of the government by a resolution from the Canadian Press Association of May 18, 1900. The complaint was considered by the Minister of Finance, and an order in council was passed on April 22, appointing the Hon. Mr. Justice Tas-chereau as a commissioner to ascertain whether such a dangerous association or combine did exist. The commissioner presented his report on November 27, 1901, and found that a combine existed which was illegal ' both by the express enactment of the customs tariff which forbids the act complained of and authorizes direct government action if it is committed,' and by section 220 of the Criminal Code, to say nothing of common law on the matter.'
The report of the commissioner, having been placed before His Excellency in Council, an order in council was passed in February of the following year reducing tne duty on news printing paper from 25 per cent to 15 per cent, which reduction has remained up to the present time.
As a result of this investigation, rendered possible through the legislation of 1897, the consumers of Canada have profited to the extent of a ten per cent reduction in the duty on paper ever since, and it is difficult to say how many cases this successful operation of the Act against such a powerful combination as the Canada Paper Manufacturers may not have prevented in like combinations among other manufacturers or attempts to reap an unfair advantage at the expense , of the public in the case of those already in existence.
One would have thought that legislation of that kind would have received the heartiest endorsation of both sides of the House, and one is surprised to find, therefore, looking over the debate on that measure, the extent of the opposition to it, and the grounds on which the opposition was based. Moreover, since that legislation has been on our statutes, there have been complaints from different sources that it is not sufficient and that something elsb is necessary, and it is the purpose of this measure, which the government has introduced, to supply any deficiency. I propose to point out in a few words the grounds of opposition to the measure of 1897, and to show wherein the present Bill removes these objections and makes good1 any deficiencies in the law at present.
In the first place, the main attack against the Act of 1897 was that it put the government in possession of a weapon io be used for the purpose of intimidation and to serve political ends against friends and foes alike by leaving to the discretion of the government the

initiation of proceedings and the giving of power to remove customs duties. It was claimed that the Governor in Council, having power to remove customs duties, might threaten a particular firm with the exercise of this power if they happened to be political opponents. On the other hand, if they were friendly to the administration, they would receive exemption from attack.
Mr. SPROULE.: Was not that practically the case?


George Gerald King: I do not think that can be shown in any instance.


Thomas Simpson Sproule: There was one case brought twice to the attention of the House and which was first started by the Hon. Judge Garrow. It was the case of a leather combine, which was clearly established, and in which an appeal was made to the government to take action, and the government never did anything.


George Gerald King: If my hon. friend considers such a case to have been proven, he will .probably be the first to recognize wherein .the legislation now being introduced will effectively overcome any objection of that kind in the future. My hon. friend put the case as strongly as he could in the_ debate which took place in 1897 on the legislation then introduced. He then said:
It puts in the hands of a few men the power to harass or annoy or interfere with the operations of business men in the country ... to put the traders and manufacturers of the country under the control of the government to such an extent as to keep them in perpetual dread of being attacked under this law. It might be used as a means of levying on men political contributions or blackmail to any possible extent.
I think my hon. friend will be the first to admit that the charge there made has not been born out by the facts. I feel certain that no one in this House will say that the government has ever attempted to exercise in such a way the power given it.


Richard Blain: Has there been any other investigation except the paper investigation?


George Gerald King: I am not aware of the extent
to which representations were made to the government as to the necessity for other investigations.


Richard Blain: Have there been any other investigations?


George Gerald King: I purpose to refer in a moment to an investigation'regarding an alleged tobacco combine in this country. That, however, did not take place under the section of the law to which I have just referred. I am not aware that there have been other investigations under this particular measure.


Mr. U. WILSON.: We know that the rubber combine is one of the strongest in the country. At one time I took occasion to bring it up in the House and called the attention of the hon. the Finance Minister to the fact that dealers were forced by that combine to buy from it at certain times of the year under penalty of paying 15 per cent more for their goods. The answer I got was that he would furnish the court if I would furnish the evidence.


George Gerald King: I think the hon. gentleman must admit the Act would hardly have contemplated action on the part of the Governor in Council in regard to evey matter that might be brought up in the House. Some more effective means of showing the neces- 1 sity for action on the part of the government should be necessary. ,


Uriah Wilson: I do not see how anything could be stronger than the combine on rubbers, and all the government had to do was to investigate it in the slightest degree to find it existed, because those who were dealing with it were fully aware of its existence.


George Gerald King: Unquestionably individuals may have strong opinions and may be quite right in them, but a government, _ responsible to the whole people for its action, would have to be very careful in moving against any particular concern, considering the responsibiltiy on it for that action, and for that reason _ it seems to me that the manner in which a complaint _ is preferred is an all-important consideration in deciding whether it should be acted upon.	. .
I was mentioning the opposition to the existing legislation on the ground that the government might use this power politically, that the power to remove duties and institute an investigation, being in the hands of the government might be used for political purposes. The present legislation proposes to do away with that discretionary power on the part of the government, and in the event of parties believing a, combine to exist unfairly, enhancing the prices or restraining trade, these parties, represented by any six of their number, may go before a judge, and having submitted their reasons by declaration to the judge, are entitled to make out a case in that way, so that it cannot be said that the government is standing in the way of investigation.


Mr. G. TAYLOR.: In clause 5 it says: Where six or more persons are of opinion that a combine exists. _ Who _ are the six persons, those engaged in similar business at different points, or a merchant with six clerks, who may have a quarrel with the manufacturer and may put him to any I amount of trouble? These six persons

should be persons engaged in the same line of business and living in different points.


George Gerald King: There may be something in what the hon. gentleman has stated, but that is one of the points that could be better taken up in committee. What I want the House to see at the moment is that one of the aims of the legislation is . * to remov^ entirely the objection that has come from certain quarters that the law as it now stands may be burked by the Governor in Council. That objection is removed by enabling the parties themselves to start the machinery before a High Court judge.
Another objection somewhat similar, was that the Governor in Council having the appointment of a particular judge to conduct the investigation might use their discretionary power to appoint some political friend, and I believe some hon. gentlemen went so far as to reflect on members of the bench in connection with the manner in which they would likely be expected to discharge their duty, it being hinted that the government having appointed a particular judge, that judge would carry out his duties, not as a judge would be expected to do, with an eye single to the justice of the case, but rather with a view of pleasing the government by which he was appointed. I think there has been nothing in that objection, but this measure removes the possibility of such an objection being raised in that it leaves the parties themselves to agree on a judge to be the chairman and also to go before any High Court judge they may desire in presenting their application in the first instance, so that if a judge does not act fairly in the matter the parties themselves must be responsible for selecting him at the outset as the one before whom they wished to prefer their complaint.
Another objection which has been urged to_ the legislation of 1897 is that it is discriminating in character, that it affects only-such articles as are affected by the tariff. al*^ has nothing to do with combines in relation to commodities not protected by the tariff. Of course the obvious answer to that is that it is only those industries that receive any advantage through the tariff that are likely to be affected, or that could be affected by the legislation as it stood, they being affected only to the extent of the advantage they had over other industries in virtue of the tariff itself, so I think there is no ground for stating that there is undue discrimination. On the other hand, there seems to be a limitation in the legislation in that it does not take account of the possibility of combines in commodities other than those protected, . and the present measure seeks to do away i with that objection by placing no restric-


George Taylor: tion on the class of business, but providing that if a prima facie case is made out in regard to any particular class of industry, then the inquiry may proceed under the law as it is proposed. Strong objection was raised by Mr. Dupont, of Bagot, a former member of this House, at the time the measure was introduced, who contended that the consumers were in a better position to know whether injustice was being done by a particular combine than the government, and he thought that, therefore, the government should not have to decide whether or not an investigation should take place, that the consumers should have the strongest say. The present legislation meets that objection, which I think is a very real and substantial one, by providing that the consumers themselves may make out their case in the first instance before a High Court judge, and if they make out a prima facie case there the state itself takes up the inquiry and carries it on. So much for the objections to the measure of 1907 at the time of its introduction.
There remain the objections as to its non-effectiveness in all particulars since its enactment. In this connection, it has been pointed out that the Governor in Council is slow to act and exception is taken on that ground. There may be very strong reasons why the Governor in Council should be slow to act. In the first place, the Governor in Council has a great many things to consider. The question of the existence of a combine is only one among a multitude of questions, and it is inevitable that, the business of the government being what it is, any question that comes up for consideration should be dealt with cautiously, and not with the degree of alacrity that would be expected in other cases. On the other hand is this further point, that for the Governor in Council to take action against a particular concern gives to the whole proceeding a kind of false glamour. It practically puts the case before the country as that of the government against an individual corporation, and that of itself affords ground for the Governor in Council hesitating before taking the initial step. So in the present measure it is provided' that the institution of proceedings shall not rest with the Governor in Council, but with the judge of a high court and with the persons who prefer their complaint before him.
Then in the next place, it has been pointed out. that the expenses in connection with the conducting of an inquiry under the present law are very considerable, that the expenses of prosecution under the Criminal Code and of conducting inquiries before a judge in the investigation of a combine, are very considerable." The Press Association, I be-

lieve, was put to about $2,000 expenses in conducting its inquiry; and it is claimed that where it is in the public interest that an investigation should take place, it is not right that practically all the expense should be left to fall upon the few individuals who may be patriotic enough to take up the work on behalf of the country as a whole. That objection seems to be a fair one; and so the present measure provides that where a prima facie case is made out, where it has become apparent to the judge of a high court that there is reasonable ground for believing that a combine has been unduly enhancing prices, and where the judge is of opinion that it is in the public interest that an investigation should take place, it is the state itself, and not the individual, who bears the cost of the inquiry.


Mr. BARKER.: What does the hon. gentleman mean by individual? Does he mean the individual who is prosecuting and who is complaining shall not be bound to pay the expense? Supposing the defendant is acquitted, does he propose to pay the cost of the defence? The hon. gentleman knows, I fancy, that in the celebrated Beckett case the defendants were put to about $12,000 expense.


George Gerald King: I think the hon. gentleman is quite right in the point he raises, and that point has also received consideration. The expenses of both parties are met by the government in a measure, that is to say, that when the investigation is held in the public interest, the parties complained against and the parties complaining each name their representatives on the board, and the expenses of their representatives are met and paid in full by the government. If it is thought desirable to appoint counsel to act in the interest of the public in bringing out the whole facts in the investigation, the law provides that the expenses of counsel in such cases should also be met by the- government, and in that way all that is necessary in the way of expense to get at the facts is paid for by the state.


Mr. BRISTOL.: In case the interests attacked desire counsel, will their counsel be paid by the government as well as the counsel appointed to represent the public?


George Gerald King: There must be a point at which the government of the country in the administration of public funds must safeguard the expenditure; to allow no individual concern to engage whatever counsel they please, and any number they please, would be going certainly much further than any government would be justified in going. If hon. members would get out of their minds what has
come to be the customary method of looking at these inquiries as they have grown up under the Criminal Code, they will see wherein this measure puts a different complexion on the whole subject. Hitherto people have come to look upon investigations as criminal prosecutions. A prosecutor has been appointed, and it has become necessary for the parties to retain counsel, and defend themselves. Now that method is done away with altogether. Instead of there being a plaintiff and defendant, instead of there being prosecutions, there is an investigation by an expert representing each side on the board of investigation. The interests complained against appoints the man in whom it has most confidence, the man whom it thinks can best represent the interests of the concern, and his expenses are borne by the state. Similarly in the case of the parties who have made the complaint, they put on the board the person in whom they have the greatest confidence, and his expenses are met by the state. If these two agree on a judge, then his expenses are met by the state. Then if the board find they need counsel to assist them in getting further at the facts, and they recommend the minister to appoint counsel, and he does so, his expenses also are met by the state. But if the parties are not satisfied with that, and they want to go the length of bringing in an array of solicitors, they of course must pay them themselves. But so far as the investigation is in the public interest, the public exchequer will stand the whole cost that may be necessary in order to conduct it fairly, impartially, and with a due regard to the interest of both sides.
That brings me to another point. An objection is raised against the existing measure that it is unfair to put the onus on anybody other than the state to see whether the facts are as they are alleged to be. Similarly in regard to the point raised by the hon. member for Hamilton. I must say that personally I think a great injustice was done to the Grocers' Guild through the expense and annoyance to which they are subjected. For three or four years a group of prominent persons in this country were standing before the public in the light of so many criminals, defendants in a prosecution, and kept in that position for nearly four years, and finally a verdict was given which showed clearly that they should never have been put in that position at all. Now, had this Bill been upon the books, instead of a criminal prosecution conducted in that manner, the facts concerning the Grocers' Guild and their relations with the public, would have come up for investigation, the Guid would have been represented on that board of investigation by an appointee of their own, and the parties complaining

would have been equally represented, and these two would have had a judge sitting with them, and these three as a board would have come together, and have given out a statement to the public in the course of a few weeks which would at once have put the public mind at rest as respects any unfair criticism which might be directed against a combination of that kind. So I hope that the present measure, viewed in its proper light, will be seen to be as considerate of the interests that are being appealed against, or being inquired into, as it is of the interest of the consumers on whose behalf it is primarily instituted.
Then again there has been raised a point that a judge is -not the best person to conduct an investigation, it has been said that a judge having a particular training is not the best fitted to go into an inquiry which has to do primarily with economic, industrial and commercial conditions. There is a good deal to be said for, and against the employment of judges in work of this kind. In the first place, looking at the position from the point of view of a commercial interest, it seems to me there is a strong reason why a judge should be one of the most desirable of men for a board. It is the duty of all constituted authority to protect private property, also to see that there is no undue interference with individual liberty, and that is best done by those who are specially trained with a view to safeguarding these public and private rights. Where you have such large interests as those which are to be seen in these great commercial corporations it seems to me eminently - desirable that a judge should be one of the parties to protect _ those interests. On the other hand, looking at it from the point of view of those who are interested in preventing a combine from carrying on its work in an unfair manner, it would appear tq be to their interest that a judge should be appointed. Most of these combines operate, in so far as they operate successfully, through agreements drawn in a very skillful manner by the best legal intelligence which these large corporations are able to command, and a man with the training that a judge or a skilled lawyer is likely to have would be in a position to satisfactorily examine into the intricacies of the contract and agreement which might be an essential part of any big combination. So that, from the point of view of those who are complaining against a particular combine, and also of thO'Se who are members of a combine it seems to me that there is a strong reason for having a judge upon any board of investigation. But, there are equally strong reasons for having on these boards men who are specially skilled m the particular interest that they are examining into. Nobody could better inquire into the intrica-Mr. KING.
cies of a combine than the man who feels its effects, and if you leave to the individual who is suffering from a particular evil the choice of the man who is going to find out whether that evil is existing or not you give him the most effective means of getting at the truth of matters. Similarly, if you take a combination that thinks it has been unfairly treated at the hands of the public, and if you allow that combination the right to place on the board a man who knows the intricacies of the whole business, who is able to put the case before the public in such a light that the business of the combination will be clearly thrown into relief, something in the nature of justice will be done by such an examination. So, I say that this measure aims at doing justice, and meeting the points of view urged by both sides in this connection at securing a combination of legal, commercial and industrial intelligence for the purpose of the examination. A board better constituted for the purpose of cond'hcting such an examination. I think it would be impossible to devise. These are, I think, the main objections which have been taken to the legislation which is at present existing, and I think I have shown that this Bill as it has been drafted overcomes these particular objections. I have only one or two more points to bring out, and then I shall resume my seat.
In so far as any other limitation may be urged it may be said that the remedies which the law affords at the present time are not adequate or sufficient, that there may be a great variety of abuses, and that the law as it stands is not sufficient to meet those abuses. I think the House will agree with me that it is pretty difficult to devise any measure that will meet every kind of abuse that may arise, but certainly the first step towards getting at any remedy is to get at the facts. If you disclose an evil the remedy for that evil will reveal itself in the course of a very short time, but it is to get at the facts in the first instance that is a necessary and essential step in order to bring about a result, which, it is admitted, will do more to achieve the end desired than anything else.
To illustrate what I mean, wherein special remedies can be provided to meet special cases if the need be disclosed-in 1902 representations were made to the government that by the adoption of an exclusive contract system between the American Tobacco Company, Limited, of Canada, and the Empire Tobacco Company, Limited, these companies were able to prevent those who dealt in the class of goods made and supplied by them from selling the goods of other manufacturers, and thus creating a monopoly which seriously affected the interests, not only of other manufacturers in Canada, but also of the

giowers of tobacco. This was clearly a case of alleged combine in restraint of trade, but, as it was not alleged that the combine was one in relation to an article protected by the tariff, and which the existence of the tariff was helping to facilitate, an inquiry could not be ordered by the Governor in Council under that measure. Had this proposed measure been in existence the matter would have become one for consideration before a board of investigation such as is provided for under the Act. There being no such measure, however, it was necessary to fall back for the purpose of inquiry upon the General Inquiries Act, and to issue a Royal Commission for the purpose of investiga-ing this alleged combine.
His Honour Judge MacTavish, of Ottawa, was appointed commissioner.	In
his report presented to the Governor in Council in April, 1903, the commissioner found that the contract system complained of by the parties did, in fact, exist and was in general use in the cigarette and tobacco trade in Canada, that the provisions of the contracts in question were not illegal either under the Dominion law or under any statutory law heretofore enacted by the parliament of Canada, but that the manufacturers of cigarettes and the growers of tobacco in Canada, other than the American and the Empire Tobacco Companies, were at a disadvantage in the distribution of their goods and in the prosecution of their business generally by reason of such contract -system.
The commissioner having made this finding, the then Minister of Inland Revenue, now my hon. friend the Minister of Marine and Fisheries (Mr. Brodeur) at the next session of parliament introduced, on October 4, 1904, a resolution which after being adopted was followed by an Act, Edward VII., c. 17, for the purpose of providing for the cancellation of inland revenue licenses where manufacturers holding the same sold goods under a monopolistic form of contract designed to prevent the purchaser buying goods from any other manufacturer or dealer.
Here was an effective remedy for consumers and an effective means of destroying combines which had been formed in virtue of special privileges gained through a license granted by the government for a particular kind of business.
Under the legislation that the government is introducing at the present time, that legislation of 1904 will be made more effective. A Royal Commission was necessary to disclose the combination which was shown in this particular case. Under the proposed law, an investigation by one of the boards established under the Act showing that a combination in restraint of trade existed, within the meaning of the law of 1904, would have the effect of making penalties under that Act applicable to a combination of that kind.
It is impossible to foresee al the circumstances under which combines injurious to trade or the people may spring up, but in so far as any may be known at the moment it is believed the present measure contains the means of affording effective relief to the consumers, and punishment to those who persist in deliberate wrong-doing, or a harmful course of procedure.
For example, somewhat analogous in its way to the monopolistic possibilities _ of licenses, are the monopolistic possibilities which patents confer.
There is reason to believe that a form of combination in the past which has worked considerable hardship in many directions is one which has grown out of an unfair use made, by the parties possessing the same, of rights which they hold in virtue of certain patents. It has been alleged, for example, that in some cases the holders of a patent which is more or less essential to an industrial process, have declined to sell this article to parties requiring it in connection with the work of manufacture, unless such parties would agree to purchase all other articles 'required in this connection, either directly from or through the holder of the patented article desired.
Of this nature was the case of Brunet and others versus the United States Shoe Machinery Company of Canada, which was the subject of considerable litigation in the courts of this country and was carried on appeal to the judicial committee of the Privy Council. The judgment of the Canadian courts were reversed on the appeal on certain points of law respecting contract, but Lord Atkinson in delivering the judgment of the Privy Council made the following significant statement in part:
If the monopoly established by the appellants and their mode of carrying on their business be as oppressive as is alleged (on which the lordships expressed no opinion) then the evil, if it exists, may be capable of cure by legislation or by competition, but in their view, not by litigation. It is not for them to suggest what form the legislation should take, or by what methods the necessary competition should be established. These matters may, they think, be safely left to the ingenuity and enterprise of the Canadian people.
It is claimed, too, that the holders of patented articles not infrequently make arrangements with dealers, binding them to sell only the articles made by the holders of some patented article, and not the article of a like kind of any competitor on

penalty of refusal to supply the patented article.
Through exactions of this kind, and I am inclined to believe that they are much more numerous than the public imagine, trade has been very seriously restricted. In some cases worthy producers and manufacturers have been ruined either in part or in whole, and in all cases there has been exacted from the consuming public a toll such as appears to have no justification whatever, especially when one considers that a patent is a special privilege granted by the public itself through a government which is responsible to it.
The present measure proposes to deal in a special way with combinations of this kind; in the only way that is calculated to afford effective redress, and to afford the kind of relief which Lord Atkinson in the case before the Privy Council which I have mentioned, indicated it should be attempted to cure by legislation rather than by litigation.
It is provided that in case the holder or owner of any patent issued under the Patent Act makes use of the exclusive rights and privileges which, as such owner or holder, he controls so as to restrict competition or enhance prices, the patent shall be liable to be revoked.
There is one broad section of the Act, No. 23, which provides a penalty of general application in cases where the board finding that a combination is existing, recommends that the combination shall change its methods, and the combination later fails to do so within a specified time. In such a case provision is made for a penalty with the view of preventing a continuance of these evils.
It remains only to consider the probable criticism of the measure now being brought forward, and the possible alternative plans which may be suggested. As the measure has been before the country for over t-wo months there has been ample opportunity for a full consideration of its several features, and for ascertaining through representations which have been made one way or another by correspondence, by personal interviews, by comments in the press and by resolutions, what are the alternative courses of procedure or lines of criticism which may have suggested themselves to those who have been giving serious consideration to this measure.
Omitting reference to such criticism, and comments as are merely of a combative, discursive or trivial nature, the objections to the measure appear to be based largely on the self interest of the parties making them, rather than on general public grounds. One group says that the proposed Act goes too far, the other that it does not go far enough; one that investigation is too easily obtained, the other that there Mr. KJNG.
is still too much' difficulty in obtaining investigation. Such expressions would appear to indicate that on the whole a fair compromise had been reached, and that from the point of view of the public the balances been evenly held. There are of course in this country as in every other those who fear investigation, who argue that it is harmful to business, prevents initiative, and destroys organizing capacity. To such it is perhaps a sulficient answer to say that the largest industrial organizations in the country at the present time are obliged to submit their affairs to inspection and investigation. The work of the Railway Commission is all in the nature of investigation, and the splendid service which has been rendered the country as well as the railways themselves Dy this body is one of the strongest arguments which can be advanced in favour of control through state agencies.
Similarly the banking business of the country is subject to important restrictions and regulations imposed by the state which involve much in. the way of publicity of their affairs. Some of the largest corporations have found it to their interests to invite publicity. The United States Steel Corporation is a case in point. Mr. Carnegie has openly proclaimed his belief in the right of the state to inquire into large businesses. Both Mr. Carnegie and President Gary have spoken in favour of governmental fixing of prices in monopolistic industries. The contrast between the manner in which the affairs of the United States Steel Corporation have been viewed by the public in the states as compared with those of Standard Oil is a sufficient commentary on the merits of publicity as opposed to secrecy in the management of large corporations. As a matter of fact, any business which is carried on in a manner that does not admit of its workings be-ine made public is one which should not be allowed to exist, and at any rate should not receive corporate rights and privileges at the hands of the state.
All the arguments that can be urged against any powers of investigation conferred in the present Act could be urged with equal strength against the powers which are given to boards under the Industrial Disputes Investigation Act, which the present Bill follows closely in many particulars. It was claimed when that measure was under discussion that the powers given to boards to summon witnesses,, compel the production of documents, and in other ways give publicity to their affairs would be harmful to the interests involved. During the past three years there have been some 80 boards established under the Act. These boards have had to do with the investigation of the affairs of many of the largest indus-

trial concerns in the country, including transportation companies, mining companies, and other industrial establishments, most of them having a more extensive business than any industrial combine as yet known in this country, yet in no case has it appeared that the 'board thus conferred has worked an injury to the business of the concern which has been made the subject of investigation. On the contrary, the access to truth which was been assured in this way nas Deen the one factor which has led to a settlement of industrial differences, and the avoidance of industrial war in over ninety per cent of the cases in which it has been employed. The truth is that a business, legitimately conducted, has everything to gain by an investigation of its affairs. The very best concerns may be wrongly judged by the public and an investigation may restore that measure of confidence so desirable in the management of any business. Mr. H. W. Clews, one of the ablest of New York financiers, at the time that business looked at its worst in the United States, come out with this interesting pronouncement with reference to the investigations which were being forced by the administration:
The check upon this tendency towards monopoly and excessive centralizations of industry -may, of course, be temporarily unsettling; in Wall street, hut the ultimate effect even upon investments will toe highly beneficial, for it will disarm much of the public criticism naturally aimed at the great corporations and monopolies which would surely continue to abuse the great power obtained without due restraint. It will he remembered that none of the calamities which were predicted in event of a decision against the Northern Securities Company ever happened. On the contrary, the decision was distinctly beneficial; it averted worse political agitation.
Businesses honourably conducted have nothing to fear from the present measure; even supposing as is highly improbable that they are very likely to become the subject of investigations under its provisions. On the other hand, the possibility of investigation will be of the greatest service in causing those entrusted with large investments to be conservative and careful in their management. Should business not be properly conducted and should the public be suffering a wrong in virtue thereof, it will hardly be denied that investigation in every sense of the word is in the interests of the public.
A business which is being carried on in a legitimate, fair and honourable way has nothing whatever to fear from the investigation which this law would provide. Many a concern that to-day is being unfairly criticised by the pubiie will be pro-218
tec ted by this very legislation 'because it provides ^ the means of bringing before the public the true facts of the case. On the other hand, this legislation does aim a preventing the mean man from profiting in virtue of his measures. The one end and purpose of this legislation is to prevent the mean man from profiting in virtue of his meanness, and I know of no way by which that can he more effectively done than by providing some kind of machinery which will enable an intelligent public opinion to be formed and focussed upon the particular evil which you are endeavouring to stamp out. Pen alties are frequently of no service towards that end, but publicity is all important and essential, and it is for that reason that in dealing with*this particular class of cases we had to endeavour to devise an instrument which would bring into play that most potent force in society, namely, an itnelligently formed public opinion which is so effective a factor in the regulation of commercial and industrial affairs.
Of the alternative plans which have thus far been suggested there are but two which seem to be deserving of careful consideration. Each has merits of its own, but each is also subject to distinct limitations under existing conditions. The fact that the present measure stands as it were midway between the two, combining the conditions of both without being handicapped by the limitations of either should help to afford a common ground for union to the advocates of these alternative views.
In the first place, it is suggested that the government should appoint a special agent or agents, whose business it would be to make the preliminary investigation wherever there was ground for believing that a combine injurious to trade might happen to exist. This view has been put forward by different persons. It has been expressed in its simplest frm by Mr. F. W. Thompson, the Canadian correspondent of the Boston 'Transcript':
The present critic inclines to think that the Bill might be bettered toy establishing an official whose duty should 'toe to take and to examine every complaint of ' combine ' alleged toy anybody.
The same view has been more forcibly expressed in an interview alleged to have been given by a leading Toronto lawyer, and which I find quoted in the Hamilton ' Spectator ' of January 24.
What would have been a more far better than the calling for an investigation toy six people or more who have reasons to. think that there is a combine, would toe for the government to appoint an official investigator. His duties would be to listen to all complaints,' and as soon as one is made, he should be



given the power to go to the offices of those supposed to be in combine and take full charge of the books. It would be a simple thing for him to decide whether there is a combine or not, in his opinion, and if he decides there is, then let the commission hold the investigation.
It must be perfectly apparent that if the government were to adopt that plan, not one but a host of investigators would be necessary. Moreover, the objection that has been urged against giving the Governor in Council power to remove officials in certain cases, could be urged with even stronger effect in this case. If the government came down with a measure of that kind, it would probably be asserted that the officers whom they would be likely to appoint would become mere tools of the government, and very little confidence would be placed in their investigation. No such [DOT]argument can be urged against a High Court judge.
The other alternative plan is to appoint a permanent commission, like the Railway Commission. There is much to commend that proposal; but the time has hardly come yet for taking such a step. One thing these individual boards may do: they will assist in revealing the necessity or non-necessity for the establishment of a permanent board to deal with the regulation of trusts and combines. More than that, they will reveal the best class of men to appoint on such a body should it he found desirable to appoint a permanent board. The United States, from which we have copied many good things, whose Interstate Commerce Commission I think suggested the idea of our Railway Commission, up to the present time has not found it desirable to appoint a permanent board to deal with trusts and combines; and we, with our more limited- experience, would be hardly justified in taking that step. Rather they have taken the step of establishing first a Bureau of Corporations in connection with the Department of Commerce and Labour, for the purpose of exercising greater supervision ov'er industrial corporations. The result of the examination of these bodies will be to show whether or not we in this country would be wise to proceed towards the establishment of a similar bureau of corporations, or whether it will he better to go in the direction of establishing a permanent commission.
I would have liked before closing, to have referred to some of the opinions expressed by the press of the country with regard to this measure. I think I am correct in saying that the general consensus of opinion of the press, representing all classes and all shades of political thought, .is to the effect that legislation, of this kind is what the country has been expecting for some time past, and should be enacted as speedily Mr. KING.
as possible. I have also received communications from a vartiety of sources. I might mention, for example, a communication from the Master of the Dominion Grange, in which it is stated:
As you are perhaps aware, the farmers' organizations of Alberta, Saskatchewan, Manitoba and Ontario have united their forces. One of the first acts of their united executive, of whom I am secretary, will be to take advantage of your Act, which meets with the most enthusiastic approval of our organization.
Our organizations number more than 25,000 members, and we are very much in earnest in this matter.
That is the view the farmers take of this measure. I have also a communication signed by the executive of the Dominion Trades and Labour Congress, representing a very large proportion of the labour organizations of this country. This body has asked for the insertion in the Bill of a clause, which I propose to move in committee. This communication states:
Should parliament see well to insert the safeguard herein suggested, we do not hesitate to say that the Bill would receive the hearty endorsation of the organizations which we represent, and which are some 628 in number and have a total membership of 40,728.
If, therefore, we have regard to the general expression of opinion which is taking place throughout this country, we shall see that this measure is demanded and endorsed by the most representative bodies of the Dominion as well as by the public generally.
In conclusion, let me say that it is not claimed for this measure that it will by any means abolish all the evils which are claimed to be the result of combines and trusts in this country. The most that can be hoped for any such legislation is that it may be a step in the right direction. Broadly viewed, it is in the machinery for investigation and for the framing and shaping of an intelligent public opinion which the measures provides, that its main features consist. It aims to get at the truth and to have the truth when ascertained, so presented that the remedy for a wrong disclosed will be self-evident. It is framed in the belief that once in possession of the facts which are of first importance to itself, the public will find a way of seeing that any evil under which it may be wrongfully suffering will be removed and that no situation, however complicated, will prove too intricate for a satisfactary solution, but- to ascertain the facts, to get at the truth, is the first of all essentials. It relies on the moral sense of the community as a ' compelling force,' when concentrated intelligently on a business wrong. Inteligent public opinion

will protect honest business and condemn unfair practices.
In the publicity, therefore, which this measure secures, not to private affairs of honest business men, as may be urged by those who are interested in thwarting legislation of this kind, but to the wrongful acts of mean men, lies its strength in securing the well-being of the people, which it is its purpose to maintain. It is an honest endeavour to grapple in a fearless, practical and thorough manner with what is, undoubtedly, the most complicated, intricate and far-reaching of those problems to which our present social, industrial and commercial life have given rise, and which presents, I believe, more difficulties than any single problem in the world to-day. If it does nothing more than restrain to some extent the aggressive tendencies of large aggregations of wealth, and to secure as respects those powerful interests, some measure of that social control which is essential to the protection of the wellbeing of the many, it will prove not only a benefit to this nation, but I believe, an onward step in the march of social progress.


Mr. E. N. LEWIS (West Huron).: Mr. Speaker, allow me to congratulate the hon Minister of Labour upon his first lengthy deliverance in this House. I am sorry, Sir, as I am sure the hon. gentleman himself is, that Ihe has been handicapped by the rules of this House in not having been able to lay on the ' Hansard ' table the numerous quotations which he has made, and thus have shortened his time. We have been listening from 11 o'clock till half-past 4 to his very able deliverance. I have taken a great deal of interest in this ^matter of combines, and in ' Hansard ' of the present session, from pages 92 to 96, on November 15 last, I gave the resujts of my study of the question. There is no doubt that the people of this country are very much worked up in regard to the abuses of combines. The hon. minister did not see fit to mention any specific cases, but there are no goods in use by the plain people of this country, from tin tacks to rubber goods, from leather goods to wash goods, the cost of which is not enhanced by the combines, and these combines are only effective under the tariff regulations of the country. I have quoted the Minister of Finance on page 93 of ' Hansard ' of the present session in reference to that. While I join with the hon. Minister of Labour in regard to the general principle, I take issue with him on the law he is trying to promulgate, that is, in regard to the multiplicity of boards to deal with this matter. The main trouble is this. If a merchant-in this country finds that the goods he is selling are being imported at an under valuation, all he has to do is to mention the matter to a customs officer 218J
and the whole machinery of the Dominion of Canada is put into force to see that he is protected; but if a retailer desires to put into force the present law as to combines, or the law which the Minister of Labour has laid down, he has to go into court, and appear in the limelight, and if he does that he will be cut off from securing _ from the wholesalers any goods he desires to sell. I submit that there is only one remedy-one board of experts similar to the Railway Board.
Some time ago I brought before this House the suggestion that we should have two Tailway commissions, one in Winnipeg, for the purpose of facilitating the business of the country and relieving the people of the west from the necessity of coming to Ottawa to have their grievances remedied. The answer given me by the government was that if we had two boards, we would have two systems of jurisdiction and two different interpretations of the law. But how many would we have should this Bill come into' operation? There is much more reason for having two or three railway boards than two or three investigation commissions, or even fifty, as we may have under this Bill. The questions are not at all alike. All the disputes that come before the Railway Board have reference to grievances on railways and canals and1 the like, -which can be easily adjusted in whatever part of the country these difficulties arise, and where, for their proper understanding, the local situation and circumstances could be personally examined by the board. But the questions dealt with by this Bill are much broader, affecting trade and commerce, the adjustment of which in any particular locality affects the whole country, and, therefore, these can very properly be adjusted by a commission sitting in Ottawa. I submit, therefore, that the whole matter of the tariff, on which the existence of these combines hinges, should not be left for decision to the Minister of Finance, with his multitudinous duties, but to a commission of experts, men of experience above bias, which would investigate into these subjects and advise the Minister of Finance. The United States, which is now in the grasp of the combines and trusts, is the only protectionist country in the world without a tariff commission.


Mr. MICHAEL CLARK (Red Deer).: I rise. Mr. Speaker, with very considerable fear and trembling, to put before the House my views on this subject, because I recall that, in the last general election in England, the only true representative remaining of the old Manchester school, lost his seat,. Nevertheless there are one or two things I would like to say in reply to the speech of very great ability, and not inconsiderable duration, to which we have just listened from my hon. friend the Minister



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of Labour (Mr. King). That speech seemed to me to bear the marks, from every standpoint, of two outstanding characteristics which my hon. friend has developed in a singular degree-great zeal in the public service and capacity for hard work.
John Graham Haggart: Hear, hear.


Michael Clark: I am not sure,_ however, that the zeal was on this occasion mixed with quite the proper amount of discretion. I may say that I regret very much that the whole House was not present to hear that speech, because it was so very valuable a preliminary step in the investigation which was recommended that I am sure it will tax the digestive capacity of hon. members to fully absorb what has been given them.
I do not wish to put myself in opposition to what will probably be the prevailing sentiment of the House, but, in common with a good many members, who are suspicious that all roads lead to Rome, I have a little weakness on the question which, as I have already indicated, is not too widely shared on this continent; and before saying very briefly what I believe is necessary for me to say on this occasion regarding the real origin of combines, I would point out that, as a Liberal of the old school, I approach the question of.state control with veTy considerable suspicion. I commend the candour of the hon. minister. He used the phrase with considerable frequency and did not endeavour to conceal his conviction that such control was necessary in this particular case. I regret very much, on my hon. friend's account, to hear a young Liberal approach the subject of state control in so light hearted a manner because I recollect the fact that the progress of true Liberalism has been associated in the history of England with a gradual diminution of state control. The establishment of liberty is the work on which Liberalism has been engaged, and I regret that any one bearing the name of Liberal should approach the subject in a light hearted way. As a free tradeT I hailed that portion of my hon. friend's speech which could be fairly represented as a plea for cheapness. I have considerable hopes of my hon. friend the Minister of Labour, on the trade question. He has so broad and on the whole so open a mind, so attractive an intellect, that I am very sure that, when he gets time to bring the same? energy to bear on the trade question which he has bestowed on the question of combines, he will very nearly reach my position on that question. Of course I do not quite understand the plea for cheapness as being a very strong argument in a protectionist country, because I understand that one of the cries of protectionists is that dearness is a good thing. 1 understand that they believe in dearness. If that be so, I do not see how a plea for cheapness can Mr. M. CLARK.
very strongly recommend the investigation we are promised. My hon. friend said very truly that there is no harm in a combine in itself. The men from whom I learned Liberalism fought, in the middle of the last century, and fought hard, for the right of workingmen to combine in trade unions, and in the statement that there is no harm in combining in itself, I am in accord with the hon. minister. But the real evil which the government is trying to get _ at is the cause of the increased cost of living. That is the real trouble. I should hesitate very much to put any obstacles in the way of this committee or this proposed legislation at all. I would hesitate very much to do so because I am quite sure, as my hon. friend indicated in his closing words, that there is a large section of the public so appreciative of this evil that they will hail any attempt which is likely to give them relief from what is becoming unendurable. My hon. friend said that the increased cost of living was not necessarily an evil. I think that Bestiat, who was a little more exact in his thinking than my hon. friend, said that there are two kinds of dearness. That was pointed out long ago by the French economist. He specifically told what those two kinds of dearness are. One -was due to the limitation of supply. That of course every one knows will cause dearness. The other one, the good kind, is due to the increased demand.
The minister made what was to me an extremely interesting remark when he pointed out that in England, Canada and the United States, taken in that order, you have an increasing scale of the degree to which this evil is felt, that is to say it is not much felt in England. I read my British papers from day to day, and I cannot say that I understood it has been much felt there. A personal friend of mine, one of the most thoughtful men I have met in Alberta, who had been 25 years in the United States and Canada, went a short time ago to the old sod, and he wrote back that he had been able to strike for the first time in a quarter of a century a place where he got value for his money. In Canada it is felt a little more than in England and not nearly so much as in the United States. The feature in that increasing scale it strikes me is that in the same countries you have exactly the same relationship of the countries to commercial freedom. You have practically free trade in England, you have a moderate tariff here, and you have a high degree of protection in the United States. I do not know whether that will suggest to members any connection between protection and the high cost of living. The minister said that the first thing to cure the disease was to investigate it. I quite agree that diagnosis would precede cure, but I should like

to go a little further in the medical studies of my hon. friend and to say that the first thing to cure the disease is to eliminate the cause. If I have any objection on this ground to the policy that has been elaborated so ably by my hon. friend it is that the treatment it recommends is of a somewhat symptomatic nature. I do not think it goes down to the root cause, it partakes rather of the nature of the pill-to-cure-an-earthquake remedy. If a man has a rotten bone in his shin it might not do much harm to give him a hot bath, but the only thing that would give him a sound limb would be to get rid of the rotten bone with the surgeon's knife as soon as possible. The hon. gentleman, I think, admitted that protection was one of the very numerous causes he mentioned for the increased cost of living, and he went on to make a remark that it does not follow that protection in the long run is not a good thing. I was filled with regret at that remark, by reflecting that if the run is too long I will not be there to see it; if protection is only to be a good thing in the long , run and is a bad thing at the present time, we ought to get after it in our own lifetime; I should let the people living in the long run think for themselves and get at this particular cause of trusts.	.
I resemble President Roosevelt, if I caught the minister's extract correctly, in doubting both the utility and the feasibility of this class of legislation. Mr. Roosevelt's language, as I caught it, was that legislation of this kind is likely to be noxious where it is not ineffective, and there are root principles for this. After all in a protectionist country-and I put this because a speech such as the minister has made is bound to call forth considerable comment,	and comment coming
from a member of the - Manchester school on this continent cannot be taken too seriously-I would like to make one or two converts to my view on free trade before my removal from this sub-lunary sphere. The government in a protectionist country, by its fiscal policy, makes the -whole country a huge trust, that is to say it puts blue-coated, brass-buttoned gentlemen on the shore to shut out foreign competition. To that extent the country becomes a huge trust, and it resembles a trust in this that it takes from its consumers very much more money than what it gives in return is worth. I am not depreciating this government or the government that preceded it, but my point is that we buy-and I never heard a commercial man dispute this position-probably twice as much dutiable goods in Canada made in Canada as we import from abroad. We only get revenue on what we import from abroad, so that the government sets an example of high
prices in the shape of its taxation by taking $150 for every $50 that is spent on the public service. If that is not the high cost of living as a taxpayer I do not know what it is. There is the initial wrongdoing of protection, the government is a huge trust, the whole country is made a field for a combine, and my contention is that for a government to turn around and object to its individual citizens following its own example is very much like a father smoking a 50 cent cigar and lecturing his grown sons on the evils of an occasional cigarette. 'Grave questions arise in my mind, which I shall only indicate, as_ to how far it is right to restrict any price. You establish a set of conditions by your fiscal system; sharp men-and we have lots of them in Canada-take advantage of these conditions, and they push their enterprises to a point to where it is impossible to push them in a free trade country like England. In saying that, I should like to guard myself against being misunderstood as to the interest I take, more as a free trader than any protectionist can possibly do, in the interests of the consumers. I want to say that as a Liberal I believe in the greatest good of the greatest number, I believe in the greatest good of the whole number, and on this fiscal question the onlv way we can get at the whole number is by thinking of the consumer, because we all consume, every minute in our lives, every time we stand in our clothes, every time we take a meal or enter a house, we consume all manner of things, and the true Liberal who thinks of the whole people must think of the consumer all the time. The protectionist, on the other hand, thinks of the producers, and from this point of view he can never think of the whole people, because the producers are only interested in the particular class of gdods which they themselves produce. That is the meaning of a vested interest. Of course, I have no great fault to find with my Conservative friends who inherit the traditions of the Conservative party, of standing for vested interests of minorities which I have been, fighting all my life. A very quixotic career, but not one which readily leads to official position, because in democratic countries you can only get into office by making yourself solid with a majority
Now what is the correct price of an article? There is one case in which I believe it has been found necessary, owing to the peculiar rapacity of one particular type of human nature, of legal human nature, both in this country and in the old country, to have a strict observance as to charges. I understand that lawyers' charges are always looked into very carefully. On the other hand, it has never been found necessary to look after the charges

of medical men at all, they are kept very busy looking after their own; and it is a notorious fact that the medical man is left subsequent even to the undertaker in such cases as require a second party after the doctor has finished his work. I do not know, but that we should have a branch of this department to make investigations into that matter, and throw some light on the subject. It may be that we may require some department of this new method of investigation which would look after the compensation of medical men for the huge bad debts which they contract.
Now, I have asked the question: What is the proper price of an article? Well, the answer to that is that the proper price of an article is the highest price that it will bring, and that is the principle upon which all bargaining between man and man stands. Now I have pointed out that a government in a protectionist country creates a national monopoly, and inside of the large monopoly smaller monopolies grow up in spite of anything you can do. A great Irish theologian said that every effect has a cause, and effects will never cease so long as causes are allowed to operate. You create a monopoly within a monopoly. Our old friend Adam Smith, comes to our enlightenment at this point on the subject of prices, by saying that the price of a monopoly is always the highest, that can be wrung out of the consumer. The price of freedom on the other hand is always the lowest that can be taken consistently with carrying on- public business. Now I have said that there is not much heard of the high cost of living in Britain or of combines either. It may interest hon. members of this House to learn that our enterprising friends of an inquisitive turn of mind have not failed to make efforts to establish combines in Britain. A few years ago a certain type of American cigarette was advertised largely all over the board fences and street comers of the old country, and retailers were promised specially large dividends on their first sales. This was part of the machinery by which an American combine tried to introduce a tobacco trust into the old land. But under the freedom of commerce, Wills, of Bristol, brought out a cheaper, and better cigarette, and every man in Britain who smokes cigarettes began to smoke the Wills cigarette, and the American trust was reduced to the humiliating position of being sued by the retail dealers to whom they failed to pay the extra dividends they had promised them. At a later period Lever, of Sunlight Soap fame, united with eight or ten other soap concerns, and formed a soap combine. There were certain soaps advertised throughout the land as the non-trust soap, and every washerwoman in England bought the non-trust soaps, and Lever and oom-Mr. M. CLARK.
pany sent an advertisement to the leading newspapers saying that it had been found advisable to break up their combine as there were business reasons why it should not be continued. There was a cure without investigation, there was a cure without legislation, there was a cure based on the simple expedient of freedom of commerce. Recently I believe a similar attempt has been made with regard to beef, but it has failed also. These three efforts have been made to establish trusts in Britain, to my knowledge. The Minister of Labour has an expert knowledge of this question, and he may know more than I know on the subject. But those were three great attempts to establish a trust which failed.
Now we come to the practical point as to whether anything can be done. Well, I think the way that small trusts grow up under big ones cannot be better illustrated than by the point which was raised by tile hon. member for Pontiac (Mr. Hodgins). He pointed out that under this industry building the price of cement jumped from $1.50 to $2.09 at one leap. That is building the infant industry with a vengeance, but it is also building the high cost of living to the consumer to such an extent that I was told to-day of a small village in the west where a limited quantity of cement was being used for a public work, and under the recent jumped price, if that same amount of cement had been bought at the larger price, it would have meant $1,200 or $1,300 extra for that particular village. Now in that case there was, I think, apparently a very harmless rise in the tariff which accounted for it, I think it is a fact that there was a rise in the tariff, at any rate on cement bags, which made the tariff upon the whole quantity of cement larger than it had been formerly, and following that increase of the tariff you have of course the combination which is bringing up the expense to the consumers. I should like to offer a suggestion in this connection to the Minister of Finance. Without any investigation or any legislation, he may make a Tittle experiment for the benefit of Canada, and for the benefit of the world upon this question. Let him put cement upon the free list absolutely, and see what the effect will be upon prices. That would be a nice preliminary step towards a real effective investigation into the cost, and a cure of this evil of the high cost of living. As I have said, we read of the high cost of living in Germany, we read of it in France, in Canada and in the United States, but we do not read of it to any great extent in Britain, or Holland, or Belgium, which are also largely free trade countries. Some amusing illustrations have come to my notice of how this freedom of commerce slightly increase the cost of living. Britain has got the right kind of increased cost due

to an increasing supply, and an increasing demand, which ought to enable us to see how this thing operates.
When I was at home for the Christmas holidays, I talked to a firm in the town of Olds, near which I live, and I saw a barrel of apples in the store of that firm. The people who kept the store said to me: That is one of fifteen barrels which were sent out here as No. 1 and have been returned by the different individual purchasers. 1 looked at them and they did not, to my mind, represent exactly No. 1 stuff. As a matter of fact, I was fortunate enough, for many years before I came to Canada, to have a few barrels of northern spies' and county kinss sent to me from Ontario every year, and I can assure this House that I ate better northern spies and county kings in Newcastle-on-Tyne, England, than I have ever tasted in Alberta. It is notorious in the towns of the west that the best beef is the exception rather than the rule, and the reason for that is that the prime, choice steers go to poor benighted England, which has no weapon of retaliation and which was so commiseratingly spoken of by the hon. member for South York (Mr. Maclean) the other day. It is extremely kind of the other nations of the world to pave with their best the rough road that the backward British nation is taking in retaining the principle of free trade.
I.have no obstructive -comments to make upon what I may say was an extremely interesting speech, but I would sum up what I have said by saying that in my judgment there is no evidence in the history or experience of nations that tyranny ever cures tyranny, and state control, whether you call it protection or socialism, is only another form of tyranny. I have never been able to gather any evidence from any source that tyranny really cures tyranny. What really cures it is freedom, and- the nation which is the greatest trust _ buster is that which believes in and applies the principle of commercial freedom. I have indicated what I believe to be the cause of the condition with which this Act is designed to deal, and I am not prepared to place any obstacle in the way of any relief from the cost of living, which is making flaring headlines in almost every newspaper in this country, but I beseech my hon. friend the Minister of Finance (Mr. Fielding) to come to the assistance of the Minister of Labour on this question and show him, by a little experiment upon cement in the next budget, that after all young men are not always the wisest as to the early production of the -millenium.


John Graham Haggart: Mr. Speaker, it is refreshing to hear remarks like those which the hon. member who has just taken his -seat (Mr. M. Clark) has made. They are like echoes
of the past. At one time the. principles he has enunciated had the advocacy of all the hon. members I see on the front benches at the present time. They are a pleasing reminiscence, a recollection, of a former Ome. They have been forgotten, vanished, and it is with pleasure that I hear statements made and principles advocated which thirty or forty years ago were the principles of the gentlemen on the opposite side of the House.


Haughton Lennox: Not so long ago as that.


John Graham Haggart: Now. let us deal with what is at the present time before the House. The hon. gentleman is not wanting in courage who can produce a Bill such as that which has been introduced, and if be can do, anything in the direction in which he- proposes to do it, not only those on this side of the House but those on both sides of the House would be glad to give him their most earnest support. But, I am afraid that he does not understand the difficulties that he is up against, This Bill is for the purpose- of punishing parties who enhance the prices of commodities which are useful to the community, such as food. Such legislation has been tried in the United States, and, as the hon. Minister of Labour (Mr. King) states, that legislation took the form -of legislation- against combines. I want to point out the difficulty there is in connection with this kind of legislation. You must state specifically what you intend to legislate against. _ That is one of the principles of law. It is not what the intent is. it is not what you suspect may be underlying, but you must be specific in your description- of the crime in order to punish it. That is the trouble with the Bill which the hon. gentleman has introduced here. What does he mean by enhancing prices? As I have stated, thev tried this in the United -States, where they passed an Act in reference to combines. You can reach a combine. The very fact of the existence of a combination for any purpose of that kind is sufficient to enable you to punish therm The English have adopted a principle which is logical. They keep the control of corporations under the common law and punish any one who transgresses it. 'They -have never attempted any legislation shell as this. In order to punish a party who enhances the price of an article, you appoint a hoard for the purpose of inquiring into the facts. There i3 a board of investigation which makes an inquiry t-o -see whether the article is being sold at too high a price o-r not. Do you not see that in order to make the law effective, there must be a standard of value or price fixed for the purpose of reaching the individual? You leave it to the individual to state whether an article should be worth a dollar or a dollar and a half. That is not I the principle upon which legal practice or


Wilfrid Laurier: Is it impossible?	*


John Graham Haggart: I know of no way at present to accomplish it.


Wilfrid Laurier: Here is one suggested.	-


John Graham Haggart: I do not, think it will accomplish it.	-


Wilfrid Laurier: Perhaps so.


John Graham Haggart: Publicity will not accomplish it. Under the English law, the buying of articles on the market for the purpose of increasing prices is a crime. If a corporation should indulge ip, anything of that kind, its corporate powers will be clipped. The difficulty is the defining, ^ or the fixing of what constitutes the crime and punishing for it. If the hon. gentleman's Bill should accomplish the object aimed at, and I hope it may, it will be a step in the direction every one wishes, and that is that every one who enhances the value of a public necessity for the sustenance of life, or the comforts of the people should be punished in some manner or another.


Mr. M. Y. McLEAN (South Huron).: Although this is certainly a very interesting subject, I do not intend to occupy the time of the House except for a very few minutes. Indeed, I do not think that any exhaustive discussion of the subject is at all necessary after the exceedingly able, comprehensive, and interesting address we have just listened to from my hon. friend the Minister of Labour.


Mr. LEMIEUX.: Hear, hear.


Murdo Young McLean: I would not refer to the subject at all had I not on a former occasion drawn the attention qf the House and the government to the dangers existing from the multiplication of these mergers or combines and a necessity for some legislation, which would enable us to regulate them. And I wish to congratulate the hon. minister, and the government on the promptness and courage they have displayed in bringing in this measure. I have considered this Bill very carefully, indeed; and in so far as I am able to judge, it meets the circumstances of the case al-

most at every point. It furnishes the necessary machinery now lacking, and provides a simple, easy, satisfactory, practical and inexpensive method of putting that machinery in operation. Futhermore it is designed to afford protection to the consumer without unnecessarily harassing, or worrying the producer, and I have no doubt it will have that effect. In fact I do not know of any country which has on its statutes a law so simple and effective as this one is likely to be. The difficulty in our present law, as has been explained very fully by the Minister of Labour (Mr. King) is this, that the burden of putting it into operation rests entirely upon the individual. While the exactions of these combines may amount to a very large sum in the aggregate, to the individual they may amount to only a very comparatively small sum, and consequently it is not worth while for an individual to incur the expense, odium, and trouble of conducting a prosecution, and therefore no action is taken, and the combines are permitted to go on and prosper. In my opinion this legislation is calculated to provide this missing link. From the study I have given the subject, I certainly think it will accomplish that object to a very large extent.
My hon. friend from South Lanark (Mr. Haggart) has expressed his general approval of the Bill, but doubts whether there is any' possibility of finding out whether or not a combine exists. I do not think there should be any great difficulty oh that score, because it should be tolerably easy to ascertain what is the proper price of an article, and the proper cost of producing that article, and what would be a reasonable profit. It seems to me there should be no serious difficulty in this matter, and I think that the proposed commission would be an excellent medium for that purpose. It may be asked, is there really a necessity for legislation of this kind? Have we any combines or trusts in this country that are actually injurious to the interests of consumers or any other class? Now, it is very difficult for any individual to say whether or not such combines or trusts exist; but, as has been pointed out by the Minister of Labour today, a very large number of-I will not call them combines, they have now the more polite name of mergers-a very large number of mergers have been established during the past year in addition to those which formerly .existed. The avowed object of these mergers of capital is to reduce the cost of production, and I have no doubt that they will secure that object to a great extent; but if the cost of production is reduced, surely the price of the article produced should be reduced proportionately. Do we find that to be
the result? It may be in some instances. I do not know one single instance in which that has been the result; but I do know of some instances in which we have been informed at least that the contrary has been the result. There are one or two instances which occur to my mini at the moment. One has been mentioned during this discussion,, that is, the cement merger. This merger was organized during the past year. The price of cement, as I am informed, and believe, previous to the merger being formed, was a dollar a barrel. Immediately after the merger was formed and got into operation, the price was increased to $1.50 a barrel. There was also a merger formed of the carriage makers of the country, and I am informed that immediately afterwards the price of certain carriages was increased by at least 25 per cent. I am not prepared to say that that is wrong. I do not know that the price of these articles is greater than their actual value; but I do know that these increases have taken place since these mergers were formed, and I know that there is a very strong feeling in the public mind that these articles are being sold at too high a cost through the influence of these secret combines. I, therefore, think, that legislation of this kind is necessary, not only in the interest of the consumer, but "in the interest of the producer-to give the consumer an opportunity of satisfying himself whether or not these combines exist, and if they do not exist, to enable the producer to free himself from the suspicion cast upon him. Without going any further, I have no hesitation in saying that this legislation shall receive my most hearty support, and I believe that it will receive the approval of a very large majority of the people of this country.


Thomas Simpson Sproule: Might I ask the hon. gentleman a question before he sits down? I understood him to say that after the cement merger was formed, the price of cement went up from $1 to $1.50 a barrel. That is an increase of 50 per cent. The duty on cement is 12J per cent.


Mr. FIELDING.: 12$ cents per hundred pounds?


Thomas Simpson Sproule: That would be 37$ cents a barrel. Does the hon. minister think that taking the duty off would bring the price of cement down to what it was before the merger was formed?


Murdo Young McLean: There would still be a substantial reduction.


Richard Blain: Mr. Speaker, I have listened with great at-

tention to the speech of my hon. Mend the Minister of Labour in moving the second reading of this measure. I am sure both the House and the country -will be surprised to know that the government, which came into power with the promise that they would abolish all those things that enhance the cost of living, has been 14 years in power, and this is the first real effort they have made to introduce legislation to cure these evils.


Wilfrid Laurier: Hear, hear.


Richard Blain: I am very glad to hear my hon. friend the Prime Minister say 'hear, hear' to that remark, because he was one of the chief movers in an agitation to educate the people of this country to the idea that protection was all wrong, and that when his party came into power it would abolish protection, and when that was done there would be no combines or mergers to affect the prices of goods to the people of Canada. Of course, this is ancient history, and I am inclined to apologize for introducing it on a question of so much importance as the present question. But I would like to draw the attention of the House to the fact that it was not the present government that made the first effort in Canada to cure these evils, but the late government, who in 1889, put upon the statute-book a law which I propose to take a few minutes of the time of the House to place before the House and the country. That legislation was introduced under the direction and guidance of . the late Hon. N. C. Wallace. It is chapter 4 of the statutes of 1889, and is as follows:
An Act for the Prevention and Suppression of Combinations formed in restraint of Trade.
(Assented to May 2, 1889.)
Whereas, it is expedient to declare the law *relating to conspiracies and combinations formed in restraint of trade and to provide penalties for the violation of the same: Therefore, Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, declares and enacts as follows:-[DOT]
1. Every person who conspires, combines, agrees or arranges with any other person, or with any railway, steamship or steamboat or transportation company, unlawfully-	. . .
(a)	To unduly limit the facilities for transporting, producing, manufacturing, supplying, storing or dealing in any article or commodity which may be a subject of trade or commerce; or
(b)	To restrain or injure trade or commerce in relation to any such article or commodity, or to unreasonably enhance the price thereof; or
(c)	To unduly prevent, limit, or lessen the manufacture or production of any such


Richard Blain: article or commodity, or to unreasonably enhance the price thereof; or
(d)	To unduly prevent or lessen competition in the production, manufacture, purchase, barter, sale, transportation or supply of any such article or commodity, or in the price of insurance * upon person or property-
Is guilty of a misdemeanour and liable, on conviction, to a penalty not exceeding four thousand dollars and not less than two hundred dollars, or to imprisonment for any term not exceeding two years; and, if a corporation, is liable, on conviction, to a penalty not exceeding ten thousand dollars and not less than one thousand dollars.
This is the first and only law to be found on the statute-book of Canada which aims to deal with combines and mergers. It is fair to say that subsequently a clause was inserted in the tariff legislation of 1897 by this government, that aimed to cure these evils, and after that a Bill was introduced by the Minister of Inland Revenue, now the Minister of Marine and Fisheries, dealing with a similar matter. But, I am quite correct . in saying that the legislation placed upon the statute-book by the administration of 1889-is the only special legislation aimed at dealing with this important, question. .


George Gerald King: It was in 1897, the year after this government came to power, that the government passed the first legislation dealing with this matter. When the hon. gentleman said it was in 1907, no doubt he doubt he made a slip.


Richard Blain: Yes. 1897.


George Gerald King: I would like to ask the hon. gentleman whether the legislation he has just read added anything to the existing legislation on this matter at that time? Was it not merely declaratory of the common law as it then was?


Richard Blain: in the past. I do not offer any special criticism to the department of the hon. minister, but I do not think it requires a special commission to discover evils which are plain to the eye of every man. It is quite within the competency of the Department of Labour to find out, with its present organization, wdiether prices are higher than they should be, and having found that out to correct the evils with the power already at hand. No doubt the Bill makes it easier for the public to institute proceedings to discover whether or not these evils exist, and it proposes that the government shall pay the costs of any trial of the kind whether the charges are true or untrue. That is helpful, and I have no opposition to offer to it. We on this side of the House wall assist in every possible way in that respect. But what the people of Canada are looking for is not new legislation, but enforcement of the existing legislation, and what is the complaint against this government and against the Prime Minister?


Wilfrid Laurier: There is none.


Richard Blain: Oh, yes, there are many complaints, but ~ my right hon. friend turns a deaf ear to them. The charge against this government and against the Department of Labour is, that the government does not put in force the laws already upon the statute-books in respect to combines and in respect to many other matters. Instead of the government striking at these evils with the ample machinery at present under their control, they'are simply introducing a new remedy so as to lead the people of Canada to think that they are doing something for them. If the Minister of Labour had been able to come to this House and to state that he had investigated these evils and found they did exist in Canada, and that the government had put into force the legislation now at their command with a view to crushing these evils, he would have received the commendation of the people of the country, but, he has chosen to place another law on the statute-book which he asks the people to enforce, and not the government whose duty it is to enforce these laws.


Mr. F. F. PARDEE (West Lambton).: The hon. gentleman from Peel (Mr. Blain) has not grasped the intent of this legislation. I take issue with him when he says that the legislation now on the statute-books might well be used to carry out the purpose of this Bill as framed. Looking at the legislation now in existence, it appears to me most distinctly that the machinery provided is absolutely not ample to give effect to the provisions of this Bill. If it were, I would agree with the hon. gentleman that we should not enact any more legislation than is necessary.


Edmund James Bristol: Is it intended that chap. 41 of 52 Victoria shall be repealed by this Act ?


Frederick Forsyth Pardee: I should suppose not.


Edmund James Bristol: If it is not, you will readily see that the right of every Crown prosecutor throughout the provinces would still exist on an information sworn.


Frederick Forsyth Pardee: That might be, but if the machinery provided in this Act is better than that provided in any other Act, surely it would be taken advantage of. Now, Mr. Speaker, after the extremely able and comprehensive speech by the Minister of Labour any further argument in favour of the Bill would be mere surplusage. I Tose to say that I am heartily in favour of the Bill submitted by the hon. gentleman. .There can be no doubt that there are combines and combines. In the old days we had the Farmers' Alliance, which started stores and gave to those in the membership of the Alliance cheaper goods than they had been hitherto getting, and we had also the organization of the Grain Growers of the West, the efforts of which were directed towards a similar end. These combines were certainly beneficial in their effects. But there are other combines which have an evil effect on the community, and it is at such that this Bill is aimed. There is a decided conviction in the public mind that whether or not it is merely a coincidence, the price of food and the price of the necessities of life are going up by leaps and bounds contemporaneously with the organization of these combines. The people of Canada are asking that the facts should be investigated and that machinery for that purpose should be provided by the government. The very title of the Bill gives its intent; it is an Act ' to provide for the investigation of combines, monopolies, trusts, and mergers which may enhance prices or restrict competition to the detriment of consumers.' The hon. member for Lanark told us that he did not think it possible that any commission could find out what did or did not enhance prices, but I hardly think the hon. gentleman was correct in that. Do we not know as a matter of fact that it is a systematized plan of the manufacturers that in many cases they do sell goods cheaper to the foreigner than they do to the home market? As I understand it, protection was put on for the sake of fostering industries in the Dominion of Canada and encouraging competition, but it certainly never was the intention that protection should enable these manufacturers to combine together and enhance the price of commodities to the consumers.
If, therefore, as I think there can be any doubt it will be shown and can be shown that foreigners receive goods cheaper than the home market, surely there is an en-

hancement of price to the home consumer. If that is so, it will be only dealing justly with the people of Canada that that should be taken cognizance of and1 that machinery should be provided to overcome that condition. There is no doubt that sugar, groceries, glassware, harness and similar staple goods are subject, if not to a combine, at least to sale at set prices laid down by a combination of manufacturers. The everyday consumer, farmer or other has to pay that. There is ample evidence of this, as can be shown by circulars of manufacturers, merchants and others. If that is so, the very first object of this Bill has been accomplished when it can be shown by evidence taken before one of these commissions that such prices are being charged by reason of the combine and the power of the commission to see that the goods are sold to the consumer at a fair price and at a reasonable profit.' It is the duty of this parliament and of all legislatures to legislate in that way. We are here to legislate for the common good. We know that these abuses are committed every day. We know as a matter of fact, that in Toronto alone, there is one concern that makes thousands of dollars a year simply by collecting rebates and discounts from the jobbers by reason of the combines agreeing to sell only to them. Surely this should be remedied by this parliament at the first opportunity. I say that simply because the farmer, by reason of the enhanced prices, and not because of any combination on his part, but simply by reason of the ordinary law of supply and demand, is now receiving good rates for his produce, and goodness knows the farmer deserves to do well, because for many years he barely made a living and had hard work at that, it is not right to say that he can go on paying for the commodities that he uses at these enhanced prices. I say that he and every other consumer has a right to be protected by this parliament and, therefore, I think this legislation is absolutely necessary.


George Taylor: My hon. friend and others have been talking in reference to the Bill. As I understand, we have no Bill before us, but simply a resolution, and it might be better to pass the resolution and have the discussion on the Bill itself. I Understood it w^as the wish of the Prime Minister that we should have this session close by the first of May. I do not see how he can intend that when his minister in introducing this Bill has spent three and a half hours.


Wilfrid Laurier: Well spent, even if we prorogue on the second of May.


George Taylor: Is it the intention of the Prime Minister as soon as the resolution passes, to take up the Bill and then have the discussion in committee?
Mr. PARDEE


Wilfrid Laurier: Hear, hear.


Mr. J. A. CURRIE (North Simcoe).: This Bill, to my mind, savours a good deal of class legislation, and we should be very careful how we deal with this matter. It has been brought into the House by the Minister of Labour, I believe largely for the purpose of meeting the reflex echo of a tremendous muck-raking campaign that has been carried on in the United States against the so-called trusts and combines. I have heard many members of the House to-day state that there are combines and trusts in this country. I challenge any one of those members who have made that statement to name a combine in this country, not a merger, a combine. You see there is absolute silence, there is not a member here who can of his own knowledge say there is an actual combine. That shows this legislation is largely the outcome of newspaper bunkum, and my hon. friend the Minister of Labour is the most assiduous reader of newspaper and publicity in the House. There are combines and mergers, and the distinction must not be overlooked. I have a great deal of respect for the hon. member for Red Deer (Mr. M. Clark), because he goes to the bottom of ail questions, argues them from the beginning and takes a reasonable view. When the government place, a protective tariff around the country and place the men with blue coats and brass buttons around the barriers, there is no question that that forms a trust. After a while when we have practically established industries in the country and they find that they are cutting into each other's prices, there has been in the past a tendency to form what are called combines. A combine is formed when half a dozen manufacturers of an article, or all the manufacturers of an article in the country, meet together and fix the price. They can do that to-day and can evade the Criminal Code and1 this Act and everything else. As a matter of fact, there have been prosecutions-I was going to say persecutions, because these criminal prosecutions have really resulted in destroying the health and the mentality of good men in this country, these prosecutions of men simply because three or four of them get together and say: We cannot afford to -sell except at a certain price, and agree to that and1 fix the price. For this they were placed in the criminal dock. In the United States they have had similar prosecutions. But to-day there is a changed condition of affairs brought about by these prosecutions. What is that changed condition of affairs? They have accentuated this thing and made it worse still, they have brought about the merger. Men take advantage of the joint stock companies law, they issue stock in a company embracing all their factories, and

in that way there is only one company in the country carrying on business, just as the hon. member has mentioned in the case of the cement merger. Let us get down to business and see whether we are doing justice to all parties concerned.


George Gerald King: Do these prosecutions take place under the Criminal Code?


John Allister Currie: I have had no experience, but I know they have been conducted. A number of our leading men have been brought into the criminal court, and their cases have been held for months and almost years, they have been penalized by expensive lawyers, and one or two of those attacks on so-called combinations have not beeq finished yet.


George Gerald King: Is the hon. gentleman aware that it is under the law to which the hon. member for Peel (Mr. Blain) has made reference that all these prosecutions have taken place?


John Allister Currie: I grant that that law should be changed in some respects because I do not think it is fair that these people should be prosecuted when another branch of labour is. allowed to go free. Now let me see. You would take in the manufacturing business, and the manufacturing business seems to be the one that is going to be subject to the . imposition. Every one seems to have his harpoon in the manufacturer. When the interests of the manufacturer suffer the interests of the labourer suffer; because if you close up the factories of this country and throw down the tariff walls, as is proposed to be done in some of your legislation, what happens? You are escaping from one small trust to get under the heel of a greater trust, because that is what will occur. If you throw down the tariff wall between this country and the United States, are you going into a country where everything is free, where labour is free, and there are no trusts? No, Sir, you are immediately placing the industry of this country under the heel of a greater trust. The hon. member for Lambton sits for a riding where the greatest trust of this country has its headquarters, and that is the Standard Oil Trust. If you conduct business in that way you are going to throw this country absolutely under the control, not of a national trust, but of an international trust.
Now let us follow this thing logically. There are three interests concerned in this attack. One is"capital. We have no sympathy with capital, of course, because the newspapers, and all the novelists and everybody who writes about everything are down on capital. But capital is very necessary sometimes when there are hard times,
or when you want to buy a meal. The interest of capital is altogether forgotten in this Bill. Another interest is that of labour. Now what happens to labour? I believe that labour ought to be protected to a certain extent, and that capital should be protected to the same extent. As it is to-day, the manufacturer finds himself up against these conditions. He finds that his men all combine, and form a labour union, and they say: We won't sell our labour to you except at such a figure. I have scanned this Bill, and I must tell the Minister of Labour that after reading the provisions of this Bill it seems to me that the machinery of this Bill can be brought against a labour union, it will be brought under the action of this Bill just the same as any other institution, there is no protection for them. But the tendency of the law in his department has been to say to the labourer, who forms only one element in the community :	We will protect you in seeing that
you may not sell your labour except at a certain figure. But after the manufacturer has put his capital into this business, after he has bought his raw material, and put his machines to work, after he has finished that stuff, if he tries to protect himself in any way, or joins another manufacturer, and they say: We cannot sell this stuff except at a certain figure, having regard to what it has cost us, then those manufacturers are proceeded against. I believe the only correct way to deal with this question is to deal with it from the . broad standpoint of the common law. As the hon. member for Red Deer (Mr. Clark) says, let there be absolute freedom in these matters. The more you institute class legislation, the more you are setting class against class, because when you start to protect the interest of one class you are injuring the interest of another class.
This Bill proposes to deal with combines. What are combines for? Combines are for the purpose, not of enhancing prices-the Minister of Labour is so far off the mark that he does not know what he is talking about when he makes a Bill of that kind. The first object of a combination is to eliminate competition. If there is freedom of competition, the hon. member for Red Deer will tell you, prices will be at the normal and proper value. In order to enhance prices you must eliminate competition, is that not so? Does this Bill deal with the elimination of competition? No, it proposes ostensibly to deal with enhanced prices. Now. let us get down to the prices. The hon. minister stated that the board would go to work and ascertain the cost, and the hon. member for South Huron (Mr. McLean) said that the cost of these things will be got at. If either one of these gentlemen are capable of getting at the

cost of anything, there are lots of big institutions in this country that will give them $10,000 a year if they will tell what actual costs are going to be. There is a branch in every successful enterprise that does nothing else but keep track of the costs. The cost to-day will be a certain figure on a certain article; to-morrow, even so small a thing as the humidity of the atmosphere changes the cost in a great many cases. You will be surprised to know that there are so many conditions constantly changing that you cannot get at the real cost of an article; so he is travelling very far afield.
Again I say that this legislation is of a vicious character. Why, it would have been well for us to have halted and not have gone on with any of this muck-raking legislation this session, because the United States papers that I have read, the financial papers, have been pointing to Canada as a country of level-headed business men, as a country where capital is to receive a certain measure of protection. Now, they claim there is no protection to capital in England, which country is sending it over here by the wheelbarrow load, and in the United States they are prosecuting capitalists, and the capitalists of the United States are beginning to say: Well, Canada is going to be a great country in the future, the legislatures of Canada have great respect for capital. For that reason, I say that it is extremely unfortunate that we should introduce into this House, at this period, legislation of that kind, legislation that can be by any means construed as an attack on capital. I regret very much to hear the remarks made by some hon. members here to-day who take class views of this matter. I am just as much opposed to combinations as any man. I could name you one or two combines which are to-day forming mergers or trusts, and there is no law that can be passed in this House that will reach them. Once a great big merger is formed in the manufacture of any article, that moment competition ceases, because no one will venture his capital into that line in opposition to trust.
There is another feature of this legislation that I think this House should consider very seriously. There is no question that at the bottom of all those social questions-for this is after all a social question-there is springing up various ideas of a socialistic character, opposition to one class or opposition to another. The greatest interest possibly in this country to-day is the commercial interest; because when a man speaks of his riding, when he speaks of the growth of the country, when he speaks of the growth of his city, he means its commercial greatness, does he not?



M. J. A. CURRIE.

[Stage Direction]
Now, the one interest that is not represented by a committee of this House whereby it may be protected, the one interest that is not represented here by a minister with a committee behind his back, is the commercial interest and manufacturing interest of this country. I hope that this House will take that question seriously into consideration. Why should these great interests be subject to penalization constantly? Why should not the manufacturing and trading interests of the country .be represented in this House just as well as the labour interest? I do not deny my good friends on the side of labour for one moment their right to be heard here, or elsewhere. I have always listened with a great deal of admiration and respect to those men who represent labour. They are not hypocrites. They know what they want, and they rise and speak their own minds here. But, when it comes to a question of the manufacturers it is different. The manufacturers are essential, because if you close up the large manufactories the labourers of this country -would suffer, they would have to close their homes and go to foreign countries, where the articles are manufactured that should be manufactured in Canada.
An hon. MEMBER.: Who will buy from the manufacturers?


John Allister Currie: Nobody, for the simple reason that the moment that you make it impossible for the manufacturer to manufacture he must close his door. I know something about cement which is spoken of here. What was the matter with cement? Competition had reached such a keen state that the manufacturers of cement were actually selling it at from fifteen to twenty-eight cents a barrel less than it cost them. What brought this about? There is, in the United States, a great big cement trust whose headquarters are in the Alleghany and Lehigh valleys. That company came to this country, established a branch and said to the manufacturers : We are going to drive you out of business or you will have to come into the trust with us. At the time cement was selling $1.50 a barrel but in the face of that they sold their cement for 95 cents and forced the Canadian companies to form a merger of which they are the largest part and which they now control. That is how you have got your price up to $1.50 a barrel to-day. If the manufacturers in Canada are not to have freedom of contract there is not a line of manufacturing but what, in three or four years, will be forced to go into these mergers or forced out of business by the American trusts, and there will be nothing that will not be

controlled by foreign tru'sts with enormous capital. I trust that this House will send this Bill to a committee. I realize that there are interests at stake, such as those of the consumer, which should be recognized. I realize that it is a great wrong that manufacturers, or any other class of the community, should be allowed "to combine to the detriment of the public or to enhance prices, but at the same time, in looking at this question, we should look at it judicially and not take ' a one sided view of it because the question is too great a one for such treatment, and if we appoint a committee to take this Bill into consideration we should also consider the advisability of the establishment of a committee of this House on trade and commerce as we have a committee on public accounts and marine and fisheries. If this were done the labouring interests, the consumers and the manufacturers could come and tell their story to the members of this House and we would get at the actual facts and not be rushed into hasty legislation through a lot of mere newspaper talk. My hon. friend from Bed Deer (Mr. Clark) is a great free trader but, if before that committtee he found that anything was going to injure this country I am satisfied that he would stand shoulder to shoulder with any man here in advocating that which was in the best interests of the country. I am one of the protectionists, so-called, of this House, but while that is so, if it were shown to me that our country was going to be benefited by free trade I would be willing to foreswear my allegiance with the protective party and join his ranks. We have no means of hearing the arguments of those interested at the bar of this House, or before any committee, and I hope this Bill will be threshed out well in committee and a hearing given to all interests concerned. If that is done I do not think this Bill will emerge in the form in which the Minister of Labour has put it. I know he is a young man and enthusiastic upon these things, but I think he is too much inclined to look upon them through spectacles that only give him one vision of the conditions with which he is attempting to deal. We remember the old story about the two parties in Borne that quarrelled, and when one took the opposite side to the other and threatened to start another city they were told that one part of the body could not get along without the other. It is the same here; the interests of the manufacturer, the labourer and the consumer are so closely interlaced and identified that we cannot do justice to the country unless we consider them all.
At six o'clock the House took recess.
After Recess.
House resumed at eight o'clock.



ST. LAWRENCE POWER TRANSMISSION COMPANY.

[Stage Direction]
On the order being called:
Third reading of Bill (No. 115) to incorporate the St. Lawrence Power Transmission Company.-Mr. Pardee.
Haughton Lennox: The horn, member for North Ontario (Mr. S. Sharpe) has moved an amendment which I understand is not ripe for consideration, and' at all events the hon. gentleman is not present. It will not prevent the passage of the Bill, or occasion any inconvenience if it is allowed to stand until Friday.


Mr. GRAHAM.: The hon. member for North Ontario is in the city just as my hon. friend (Mr. Lennox) is. Ve are near the end of the session, and surely,, it is time that hon. gentlemen jgot down to work if they want the arrangement of the leaders to be carried out. This Bill has been talked over day after day and night after night and week after week, and this motion means, I suppose, that it be referred back to committee, purely it is not advisable to take a vote with such .a thin House. Every amendment that could possibly be conceived was moved to the Bill, and this amendment now proposed is merely an afterthought. I want to be reasonable, but I think hon. gentlemen opposite should be reasonable also.


Thomas Simpson Sproule: The hon. gentleman says we are near the end of the session, but he must forget that we have the Insurance Act, the Naval Bill, and other important sovernment measures which will take up the time of this House for many weeks yet, so that we cannot be near the end of the session. The delay asked for will not prevent the Bill going through.


George Perry Graham: Well, let it stand.



THIRD READINGS.

[Stage Direction]
Bill (No. 79) respecting the Hamilton, Waterloo and Guelph Railway Company.- Mr. Harris.
Bill (No. 116) to incorporate the Toronto Eastern Railway Company.-Mr. Fowke.

[Stage Direction]
The House resumed adjourned debate on the motion of Hon. Mackenzie King for the House to go into committee to con-
[Stage Direction]
sider the resolutions in connection with Bill (No. 101) respecting the investigation of combines, monopolies, trusts and mergers.
Thomas Simpson Sproule: Mr. Speaker, when the minister first introduced the Bill respecting combines he asked for the support of the House, and I frankly told him that if it commended itself to my judgment it would certainly have my support. I agreed with him that some authority was needed to control combines, trusts and .mergers. Since then I have examined the Bill somewhat cursorily, and I must confess that I was surprised and disappointed that it simply is a measure providing for inquiry and report. The minister told us that he depended more upon publicity to cure the evil than upon penal legislation, and in pursuance of that idea he has provided no penalties in this Bill for infringement i Act. The hon. gentleman told us also that the Combines Bill of 1889 failed of its purpose though the penalties under it were severe, but let us inquire why that Act was a failure. We were given the opinion of the late Sir Oliver Mowat, who, when asked to punish those who were acting in violation of that law, stated that although the attorney general of each province was charged with the responsibility, no attorney general could hope to successfully enforce it He said it was impossible to go into court and prove what was unduly or unreasonably enhancing the value. It was the verv wording of the law which made it useless and worse than a waste of time to attempt to enforce it. Now, how came that law to be enacted in that way? It was not the late Hon. N. Clarke Wallace who introduced it in that form at all. It w'as amended in that way in the Senate. I was there and assisted Mr. Wallace as best I could
w g6u- t}le Bil1 tllr<)ugh the Senate as it left this House, but we were unable to prevail on the members of that honourable body to put it through as it left this House. They amended it by introducing the words ''unduly' and 'unreasonably' in it, making it so that it was of little value thereafter. That was the cause of the failure of the law, and not because it imposed a penalty for the violation of the law. We appealed to the federal parliament to enforce the law, but they said it was not the duty of the federal parliament to enforce any law, but the duty of the province. When we appealed to Sir Oliver Mowat, he gave the reason I have stated why the law could not be enforced. Therefore it was not enforced, and was not effective. But the hon. member said what was true, that the evidence taken before the commission of inquiry, and the facts disclosed to the world had such an effect that a number of combines ceased to operate, because of the pub-Mr. GRAHAM.
licity. Some of them did not, and to that extent it did good, but it did not go as far as it ought to have gone. Who is responsible, I ask, for that law having been a failure? I say the present government are responsible. In 1899 I introduced a Bill for the purpose of amending section 520 of the Criminal Code by striking out the words 'unduly' and 'unreasonably.' I got that Bill through this House one session, but it was thrown out by the Senate. I got it through both House the next session. But who amended that law? It was the present government, by the then Minister of Justice, new Chief Justice of the Supreme Court. He slipped through an amendment to section 520, of the Criminal Code, restoring those objectionable words, and it passed this House without my knowing it. When the Bill to amend the Criminal Code was before the House, I asked for an explanation, and the hon. member was cute enough to explain several clauses of the Bill, but refrained from saying one word as to this; and, not being a lawyer, I did not pay as much attention to the Bill as I ought to have done. From that day to this no attempt has been made to enforce the law, and if it is a failure the present government are absolutely and unequivocably responsible.


George Gerald King: In addition to the words ' unduly ' and ' unreasonably,' was not the word ' unlawfully ' also in the Bill as it first passed this House, and I think the word ' unlawfully ' was stricken out in the Senate, and the words ' unduly ' and ' unreasonably ' left in,


Thomas Simpson Sproule: The word unlawfully was never called in question, so far as I know. That was not what affected the law. It was the words ' unduly ' and ' unreasonably.' If the law was a failure, the present government were certainly responsible for it. The present government deluded the country for a length of time by saying that they had made a better provision in the law. They inserted a provision in the Tariff Act saying that where it was established to the satisfaction of the Governor in Council that there was a combination in restraint of trade upon any article imported into this country upon which there was a duty, the Governor in Council might admit the article free of duty or so reduce the duty thereon as to give the public the benefit of reasonable competition in the article if it appeared to the Governor in Council that such disadvantage to the consumer was facilitated by the duties imposed on the article. Now, I brought to the attention of this House the grievance of those parties who were affected by the leather combine,

and read their affidavits made under oath. It was proven up to the hilt, in a very elaborate case, prepared by Mr. Garrow, before he was appointed to the bench, that the combine gave a rebate of 5 per cent to certain firms who handled certain kinds of leather, and thereby made it impossible for those who would not agree to buy from them to carry on business as they had done previously.
Right in my own village there was a tannery that was making certain kinds of leather. The tannery was unable to sell in Toronto to the firm it used to deal with on account of this combine.. I have letter after letter from men in the tanning business in exactly the same position. They could not sell the leather because they refused to enter into this combine. I had the arrangements that were made and declarations by a large number of eminent men in that line, creditable witnesses, who were prepared to prove the combine was a nefarious one, but although I called upon the government to act, they refused.


William Stevens Fielding: If my hon. friend will look into the case, he will find that action under the tariff law would not have granted the relief he desired. If the duty had been taken off leather altogether, the very, small tanner, in whose interests my hon. friend was pleading, would have been affected. That was a case vdiich did not come within the tariff law.


Thomas Simpson Sproule: The hon. minister is mistaken. What these men requested was that the duty should be taken off the kinds of leather in which this combine was principally dealing, such as Spanish soles, and which were not tanned in the small tanneries. But why could not this agreement have been attacked under the Criminal Code, had the government desired to break up this combine, or under the customs law which they professed to have made for that purpose. But they did absolutely nothing. Mr. Smith, of Chatham, told me that Beardmore and Company of Halton, Mr. Charlie Hyman, of London, Mr. Davis, of Newmarket, were in the combine and, as these were friends and supporters of the government, the government refused to act. I was, therefore, justified in making the statement 1 did this afternoon, and which I did in 1907, namely that the goverilment would not be likely to act against any combines in which their friends were interested. Experience has justified the forecast I then made. If the present Bill were to be effective, I would gladly welcome it, but I am inclined to think it will not. Why? Because there is no penalty. What is publicity? The weakest feature of the Rail-219
way Commission in the United States today is that they depended on publicity; but they found that, when they came to put the Act in force, it was comparatively a failure. Some say that its failure was due to state rights, but I met one of their own men who reviewed the subject very carefully and intelligently, and he said that the weakest feature of their Act was the lack of power to enforce it, and inflict a penalty for violation of it.


George Gerald King: Possibly my hon. friend has not read the penaltv clauses of this measure. The difficulty in connection with the alleged leather combine which he mentions, he says, was that he could not- get the government to move and ascertain whether such a combine existed or not. But under this Bill any individual can start the machinery for investigation; and if the investigation shows that a combine exists, the Governor in Council has power to remove or lower the tariff on the finding of one of these boards. .


Thomas Simpson Sproule: What clause gives that power? You have repealed section 12 of the Customs Act of 1907, which deals with it.


George Gerald King: Section 21 provides for the removal or reduction of customs duties in order to secure reasonable competition. The clause repealed of the Tariff Act of 1907, is carried over into this Bill with the additional provision that the finding of a board constituted under this measure, may 'be a sufficient warrant to the Governor in Council to take action, and similarly as respects the Inland Revenue Act, if it is shown by one of the boards that a combine exists among dealers with regard to goods, for the sale of which they must obtain a license from the Department of Inland Revenue, a clause in that Act would permit the Governor in Council to cancel the_ license. A similar cause exists in this Bill with regard to cases in which it is shown that the holders of patents are taking advantage of them to the prejudice of the public. In addition to these penalties, if it is found that, the parties are guilty of a course of action detrimental to consumers, and against the interests of the public the parties so reported against do not comply within ten davs in making the change desired, they are liable to a specific penalty provided in this Bill.


Thomas Simpson Sproule: Where is that penalty?


George Gerald King: That is section 23 which imposes a penalty of a general nature on com-



EEVISET) EDITTOX.

[Stage Direction]
bines, restricting manufacture or competition, my hon. friend could hardly have noticed this section.
Thomas Simpson Sproule: I went through the Bill hurriedly and did not notice it, and of course that section is an improvement. There, are many articles which are the subject of combine and in regards to which the changing of the customs duty would not be an effective remedy. Unless we are able to attack these combines under the Criminal Code or unless some other penalty be imposed, the Act would only be partially successful.


George Gerald King: Quite so.


Thomas Simpson Sproule: That would make it a great deal better in my judgment and give it some value, but I do hold the opinion very strongly that while publicity may sometimes prevent the doing of improper things, it does not go far enough. With reference to the Labour Act, which we passed, to my mind, that was its defect. No doubt the hon. minister will contend that that Act has been very valuable.


George Gerald King: Hear, hear.


Thomas Simpson Sproule: It has been of some value, but if there had been put into that Act a compulsory arbitration clause, it would be much more valuable. That is what the Australians think.


George Gerald King: I do not think their Act has proved as effective as ours.


Thomas Simpson Sproule: I think it has proved comparatively successful. I have followed up its workings and the Australians give it credit for doing a great deal of good. Take our Railway Commission. The first proposal was to establish it on the same lines as the United States Railway Commission, but that was proved a failure because it has no power to order and compel the doing of certain things under a severe penalty, sp we clothed our Railway Commissioners with authority to compel that to be done which they ordered. Therefore, ours has proved much more effective and valuable. The defect in this Bill would be in my judgment where we did not take
power and authority, over and above publicity to enforce our ruling and the right given to individuals to put the law in action whether the government be willing or not is a move in the right direction. But over and above all that what is required is an effective penalty that will compel combines to observe the law and punish those who violate it.


Mr. WRIGHT:: I am very pleased to
think that the government have at last taken up this matter. I think this is the first practical step they have taken in the thirteen years they have held office as an attempt to deal with what is considered a very serious problem. The idea prevails pretty generally that the. consuming public of this country are being taxed unduly by what are generally termed combines. Whether that prevails to the extent the general public believe or not, I am not prepared to say, but I do believe there are instances where combinations to unduly enhance prices do prevail. The impression prevails in some quarters that this can be cured by a change in the tariff. I do not myself believe that very much can be done in that direction. The hon. member for Red Deer (Mr. M. Clark) attempted to deal with that aspect of the case and left the impression on those who had not considered the matter very carefully that the whole trouble arose from our having what is termed a protective or revenue tariff, and I think he left the impression on the House that it was only in countries like Canada and the United States, which have protective tariffs, that combines can grow and flourish, and he gave us an instance of an attempt to form a combine in Great Britain by the Lever'Soap Company, stating that the people had boycotted that firm and had succeeded in breaking up the combine. He did not tell us the reason why the people objected to the combine . The reason was that they had been bitten by other combines in Great Britain. The combine is a modern development of trade which will flourish in any country without regard to the kind of tariff policy that country may have, and in order to show this House that that is true, I purpose reading a list, if it is not too long, of combines as they flourish in Great Britain, and I would especially comend it to the member for Red Deer. The list is as follows:
Mr KING

6*94
Company.
Industry.
Firms.
Capital.
Wilson Union and Tube Co	
United Turkey Red Co	
Curtis and Harvey	
British Dyewoods and Chemical Co	
Aberdeen Comb Co	
Rickett, Corkerill and Co..		
United Indigo and Chemical Co	
Textile Machinery Association	
Calico Printers' Association	
English Velvet and Cord Dyers	
Thames Iron Works	
John Brown and Co	
Wall Paper Manufacturers	
British Cotton and Wool Dyers	
Yorkshire Dyeware and Chemical Co	
Bleachers Association	
Associated Portland Cement	
Rivet, Bolt and Nut Company	
United Velvet Cutters' Association	
Extract Wool and Merino Company	
J. and J. Baldwin & Partners	
Leeds and District Worsted Dyers	
English Fustian Cutlery, Etc	
Dorman, Long & Company	
Metropolitan Railway Carriage and Wagon Company...
Baldwin, Limited	
Guest, Keen and Nettlefolds	
Imperial Tobacco Company	
United Carlo Gatti	
Salt Union	
United Alkali and Chemicals	
J. k P. Coats	
English Sewing Cotton	
Vickers Sons & Maxim	
Shel Transport Trading Co	
Nobel Dynamite Co	
Cotton Spinners aud Doublers	
Bradford Dyers Co	
Borax Consolidated	
Linen Thread Co	
W. Cory k Sons..-	
Armstrong-Whit worth Co	
Buxton Lime Furnace Co	
Leeds Fire Clay Co	
Bath Stone Firms	
Horrocker, Crewden & Co	
Wilson, Furnace, LeUnd	
Broonhill Coalers	
British Oil and Cake Mills	
York Indigo Scarlet Dying	
Bradford Coal Merchants	
Barry Ostlen, Linoleum	
Yorkshire Wool Combers	
Tubes	
Dyeing	
Gunpowder	
Dyes	
Combs	
Coal selling	
Dyes	
Wool Machinery	
Calico-printing	
Dyeing	
Shipbuilding	
Shipbuilding	
Wallpaper	
Dyeing	
Dyes	
Bleaching	
Cement	
Rivets, etc	
Velvet	
Wool	
Knitting Yarn	
Dyeing	
Fustian	
Steel, etc	
Wagons and Cars, etc...
Iron	
Iron and Steel	
Tobacco	
Ice	
Salt	
Chemical	
Thread	
Steel ships....
Shipping and oil Explosives ....
Spinning	
Dyeing	
Borax	
Linen thread ..
Coal selling...
Engineering....
Lime	
Fire clay	
Stone	
Spinners	
Shipping	
Coal mining ... Oil cake .. .
Dyeing	
Coal selling.__
Linoleum.	.	.
Wool combing..
4 8
4 3 2 8 7
22
34
51
53
15
7 5
5 3
6 5 3
3 64 51
5 15
6 11
4 47 34 12
8 2
3
4
11
3



$ 1,000,000 7.500.000 4.340.000 2.850.000 1.437.000 4.500.000 1.200.000 1,450,(K)0

[Stage Direction]
41.000.	000
3.500.000
4.500.000
12.000.	000 20,000,000
9.460.000
1.470.000
34.100.000
32.440.000 2,000,000 1,000,000
1.350.000
3.750.000
1.130.000
2.500.000
16.500.000
8.375.000
5.500.000
22.650.000
101,200,000
1.900.000
13.000.	000
42.102.000
55.000.	000
15.000.	000
32.250.000
15.000.	000
13.925.000
33.250.000
21.125.000
12.750.000
10.000.	000
13.650.000
25.201.000
2.612.000
6.300.000
1.250.000
4.625.000
1.570.000
3.375.000
8.750.000
2.340.000
1.250.000
4.920.000
9.520.000
These are a few of the larger ones, and you will have perceived, Mr. Speaker, that I have dealt with no combine with a capital of less than a million dollars . There are innumerable smaller combines dealing in almost every known article used in Great Britain. Now I do not think that by changing our tariff it will meet the difficulty that presents itself. The question that, presents itself to my mind is just how far the minister would go in the application of his measure. In dealing with matters of trade there are so many things that at once arise, many small considerations that might not seem large in themselves, but
where a principle is at stake. We will suppose that in a village or town the barbers get together and say: We cannot cut hair at the same price as we did before, and they form a combination to keep the prices up to a certain figure, and they give notice that after such a period they will charge a certain price to customers. This runs through the shoemakers, the blacksmiths, the carpenters, and through all the trades with which the people are dealing. Would the minister, in the application of this measure, attempt to deal with all these small matters? If he attempts to do that, it seems to me he will be trying to deal with a very large problem indeed.
6895
George Gerald King: I understand the hon. gentleman is asking me a question. Several points have been raised in the nature of questions such as the hon. gentleman has just put, and I think it would be more convenient to answer them in committee. If hon. members will adopt the resolution and pass the second reading of the Bill and get at once into committee, then I could answer all these questions and save a good deal of time.


William Wright: I am willing to leave these matters for the minister to answer them in committee. I may say that so far as I am concerned I believe that the minister is moving along the right line. He seems determined to grapple with this question in a vigorous way, and for that I commend him. I think he is moving in the right direction. I believe that all combines have the effect of enhancing prices to the consumer. I do not care whether the combines are entered into in Great Britain, or in Canada, or in the United States. I do not care what kind of trade policy a country may have, when these combines are brought into play they have the effect of lessening competition, and when you lessen competition I think the natural outcome is an increase in price. Suppose three or four storekeepers get together and make a combine and agree to operate under one management, that eliminates competition, and the result is a general increase of price. I do not suppose that all the combines that are entered into have the object of raising prices. There are many other factors that move men to form combines. I think one chief reason is to do away with a great deal of expense, and there are many other reasons why it is more profitable for several firms to come under one management. But the result generally is that the people will pay a little more for the article than they would pay otherwise. People are complaining a great deal now of the cost of living, particularly of the cost of food stuffs.
Now a great cause of the increase of prices is the failure of supply to meet the demand. Some people aTgue that by jree trade you would diminish the cost of living. Supposing you took down the bars altogether, it would not make much difference. The people have to live on the produce of the farms, and I do not believe that the farmers are getting higher prices than they are entitled to. But I Jo think something might be done in the way of lessening the cost between the original producer and the consumer, and that is one of the reasons why I advocate a home market, and the bringing of the consumer and the producer together. That will provide a home market for the farmers of this country. But that is not what is aimed at undetf this Bill, this is not the occasion, I suppose, to discuss that ques-Mr. WRIGHT.
tion. I simply rose to say that this is something that will have to be grappled with. The combines and the effect of combines are something the government will have to take hold of and deal with in a drastic manner. It will not do to put some little Bill upon the statute-book and leave it there, and let things drift along. We will have to take hold of the problem in a way that will touch any firms that get together and form a conspiracy-to increase prices where there is actually a conspiracy it comes under the Criminal Code. A weak point in the Bill, to my mind, is that there is no proper method of getting hold of that evil. Another very serious difficulty is that of arriving at the value of articles. I do not think that, unless soiite tribunal is arranged for, that the minister can make his Bill effective, and that it will satisfy the general public, people that are charged with making a combine and people that are affected by a combine, some tribunal to wdiich both sides can appeal with confidence. Without such a tribunal I do not see how you are going to get at the facts as to whether a price has been unduly increased or not. I do not see how the board that the minister purposes introducing will deal with that effectively. He is going to appoint two men to that board, and they will be required to investigate the facts. In the processes of manufacture there are a great many things that enter into the cost of the product. It requires long experience and an intimate knowledge to enable a person to determine the question of actual cost, and to say whether the price is too great or otherwise. I would rather leave it to a general commission, something after the manner of the Railway Commission, which would be the proper method of dealing with the question, rather than that it should be left to people selected on any particular occasion when a charge happens to be made. I think a general commission would be much more effective, because, from the commencement, it would be gathering an amount of information which a commission appointed on the spur of the moment to deal with one particular case could not possibly obtain. The Railway Commission, from the commencement, have been gathering information in regard to all matters connected wdth railways. This information will be very valuable to have in our possession later on. The minister proposes, when the charge is made, to appoint somebody who has had no previous knowdedge of the matter-one to be appointed by the parties interested and one on the other side-and they would go into the question, but it does not seem to me that they would be abie to deal with it effectively.


George Gerald King: As to not having persons of previous knowledge on the board that

it is intended to appoint, the representatives of the parties laying the complaint in all probability *would chose an expert, or a man who had a special knowledge of the conditions that they wished to inquire into, and in the same way the combine is likely to choose the man most familiar with its business. In that way you are sure of getting two men with a special knowledge of the things which are to be inquired into.


William Wright: I presume that there would not be much difficulty from the standpoint of the combination, which, no doubt, would be. in a position to pick out a man from their own establishment who was familiar with the conditions of that establishment. But when the minister goes outside and looks for a man who has never been in the establishment, has no connection with it and could not possibly have an intimate knowledge of its affairs, I do not see how he would be in a position to get a suitable man for the other side. However, it is not my -intention at the present stage to say anything further in regard to the matter.


Mr. M. CURRIE (Prince Edward County).: It must be generally admitted that the Bill introduced by the hon. Minister of Labour (Mr. King) will have a marked effect in correcting influences which we all feel are at work to-day. However, I believe that most of us recognize the fact that while the evils are a constant condition, the means that we are adopting will only be employed occasionally, and that if we can devise a measure which would be in continual operation on the evils of trust formation and at the same time not interfere with capital we would be taking a step in the right direction.
It has been said this afternoon that we should delay this matter for another year. I believe that the present is the most opportune time to act. We have at the present time, to be sure, a large number of pools and combines, but in so far as the more advanced forms of trusts are concerned they are not particularly numerous as yet. However, in the last few months we have had several in course of construction, and when we look back to the years 1898, 1899 and 1900 we will see an interesting condition of affairs. These were the years in which prosperity was returning to the United States, and these were the years in which trusts were most actively promoted. In this country at the present time we are at the threshold of an era of prosperity, and we may probably expect a number of trusts to be formed in practically all departments of manufacture in the next three or four years. For that reason, before we have vested interests and strong influences
to contend with, I think it would be opportune for us to adopt some - legislation which would control the matter of trust formation.
I may say that an examination of the conditions under which trusts are formed leads me to think that they have many economic advantages and that they may be of great benefit to the community at large. I wish, first, to run over shortly some of the minor benefits of trust formation. For instance, we have the concentration of office forces, the distribution of special processes and patents, the employment and specializing of the best talents, the very large element of saving in the matter of cross freights under agreements which may be made with the railways, alliances for banking with financial houses permitting them to secure better rates in respect of their_short loan, the reduction in the number of selling agents, reduction in the cost of advertising, self insurance, and advantages in securing raw materials, which we- see exemplified especially with respect to the United States steel corporation. Those that I have mentioned are simply the minor advantages of trust finance. Simply looking over these minor advantages, I think we see that the trust is of economic importance to the public. However, we have major advantages, and it is in connection w7ith these that we find most of the difficulties which are to be met by legislation. We have, for instance, the control which the trusts have over labour and labour organizations. An independent concern having its contracts to fill can be held up at almost any time by a labour organization, and will in the vast majority of cases be compelled to accede to its demands. In the case of a trust we have something entirely different, and as we know by the many instances which have occurred in the last ten years, labour unions and labour organizations can be fought by a trust when they could not be met by an independent operator in the same way. Another thing that we have is the control by the trusts of the jobbers, wholesalers and middlemen in general, and here, as has been said by several .speakers this afternoon, is where we find the process of compelling wholesalers to buy only from them and not deal with an independent manufacturer. The last and greatest benefit of the trust formation is the elimination of competition. That factor is one which will not be acknowledged, perhaps, by many of those representing the trusts, as the most important factor. In looking over the investigation of trusts by the United States government, and especially the investigation conducted by the Lexow Commission, you find that the officers of the trusts always quibbled upon this matter. But there happens to be abundant

evidence of it in connection with the prospectuses and formation of these trusts. I believe that trusts are of economic value, that they will be in ever increasing numbers amongst us, and that it is only going to be a comparatively short time when we will have a number of trusts formed in connection with practically all the staples in daily use.
That being the case it becomes a matter of importance for us to deal with measures such as that submitted by the Minister of Labour. I wish in the first place to speak for a moment, because it has a bearing on the rest of my argument, in regard to what I might call the assembling of trusts. We have first the promoter, who has perhaps the most important place in connection with trust finance. The promoter must send his experts to the different concerns that are intended to be taken into the trust; he must examine their finances, find out what their earning power is, estimate exactly what can be secured by an amalgamation of such interests. He must then present his case to the second factor who is what you might call the syndicate manager. It is from him that he must secure the necessary funds to get an option on the different properties. Consequently, we have here two factors, the syndicate managers and the promoters, who must be paid in the process of the trust formation. Now, the promoter having gone carefully over his ground and having secured his option, comes face to face with the question of capitalization, and I want to refer to that for a moment because it is of interest in connection with some of the more recent trusts that have been formed in Canada. The general procedure in the case of the trusts formed in the United States was this:	The earning power of
the independent concerns going into the trust was taken as a basis. This was capitalized and in most cases the capitalization of the actual earning power of the independent concerns was taken as the preferred stock of the trust. This was increased to a certain extent to allow for profits to the promoters and to the syndicate managers and underwriters. In the next place the assemblage of the independent concern was considered from this standpoint; that of the possibility of its earning power as a combine. All the factors of the elimination of competition and savings in other directions were taken into consideration, and these were capitalized. Usually it represented the common stock which in most instances was, roughly, equal to the preferred stock. In the case of a great many of the United States concerns the capitalization in the shape of preferred and common stock, was roughly perhaps a little more than double the value of the independent concerns on the basis of their replacement value. Now, that per-


Morley Currie: haps looks conservative, but the course of subsequent events showed in almost every, case that the trusts of the United States were overcapitalized. But, while that was the case in the United States, I want to say that in Canada the formation of the trusts we have had recently has shown something in the shape of over capitalization very very much in excess of this. I will not venture to name all the combines, but some information has come into my hands in the last few months in regard to the capitalization represented by some of the Canadian trusts. There was one case of which I had some knowledge in which the whole concern could probably be replaced at a cost of $75,000. When this went into the trust the return was $200,000 in actual cash, and $250,000 in preferred and common stock. In another instance the replacement value of the concern entering the trust would probably be about $30,000. In that case the owner of that manufacturing concern received in cash $75,000, in common stock $65,000 and in preferred stock $150,000. One other instance I will mention, and this is in a different trust from the last I referred to, and it is this: The replacement value would perhaps be $750,000 and part of that was represented by a plant which was out of date and useless. However, the owners in that case received $598,000 in cash, $598,000 in bonds, $370,000 in preferred stock and $190,000 in common stock. I am just giving these illustrations to show that in the trust formation going on in Canada at present there is an immense overcapitalization. Perhaps some one will say:	That is of no interest to this
House; if people wish to overcapitalize their businesses they simply are not going to pay such large dividends. But I want to point out that there are some evils arising from this matter of overcapitalization. In the first place the overcapitalization of these stocks removes them from the realm of investment securities. Even in the more conservative capitalization of the United States trusts the preferred and common stock were never represented as investment securities; they were the speculative stocks, and this overcapitalization here as in the United States would throw upon the market a vast mass of speculative stock as distinguished from investment securities. This system had the element of danger that it floods the market with speculative stock of the industrials as they are called, and it has given rise to nine-tenths of the stock speculation.
I venture to say that there is more gambling in this form of stocks in one day on the stock exchanges than there is on all the Tace courses of Canada and the United States for a whole year. For that reason I say that this overcapitalization, simply from the fact that it gives birth to these

speculative stocks, is a matter of importance to us. In the next place the overcapitalizations is the means by which the savings of the man of small wealth are amalgamated into the pool of the trust. I took twenty-one of the representative trusts formed in the United States between 1898 and 1899, and I found that the prices at which these stocks were first sold upon the market and the prices in 1903-and here I might draw to your attention that the years from 1898 to 1903 were years of increasing prosperity-I found that the difference in the prices of these stocks between 1898 and 1903 represented a shrinkage of $400,000,000 in the case of the twenty-one trusts to which I refer. That simply meant one of the factors, and an important factor, by which 98 per cent of the wealth of the United States has filtered into the pockets of 55 per cent of the population. And I say, Sir, that for that reason overcapitalization in any of the corporations thus formed is an evil. In the next place, these companies attempt not to go back upon the glowing prospectuses which they issued to the public; they try to pay dividends upon their preferred and common stock where possible, and the result is that the money going to their reserve fund and their renewal fund kept on diminishing so that their overcapitalization really reacted upon the trusts with serious results. In the next place, the presence of this water in the stock blinds the public to the actual profits made by these corporations, If the people see that only 7 per cent is paid upon the stocks, they look upon it as a legitimate business operation, regardless of the fact that three-quarters of the entire stock probably represents water. For that reason, as soon as the trust finds that it is paying large dividends they cut a melon or in other words distribute among themselves a new issue of stock, and the public will continue to see only seven or eight per cent paid and are blinded to the actual condition of affairs. Another thing is that if these trusts and other companies were capitalized upon a more conservative basis, we would have a still greater increase in investment securities instead of the flooding of the market with speculative securities. There is one more lesson that was learned by this overcapitalization and it was this: That many of the panics and crises that have occurred in finance in the last few years have simply resulted from collapses of some of these speculative stocks due to overcapitalization. There is one other thing that is more important than any thing else in connection with the formation of trusts, and that is that the stocks get into the hands of the public with the result that many men who would perhaps give their support to legislation opposed to the trusts, simply because they
have this stock which they are afraid may drop in value, are converted into adherents of the trusts, Professor Mead, of the University of Pennsylvania, whose work on trusts and finance is perhaps better known than any other, and who cannot be said to be an opponent of trusts, uses these words:
Legislation or competition is always threatening the profits of the trusts. By enlisting a large number of investors in its support, the directors of the company may make valuable friends of the mammon of unrighteousness, who, when it fails, may fight manfully in its defence.
I merely mention the matter of capitalization because I feel that we should deal with that when we are dealing with the trust problem in a general way.
We have then the evils of the trust which we should consider most prominently. First, there is the control of labour, in regard to which the Lemieux Act is as useful as anything could be. In the next place, in regard to the control of middlemen and wholesalers, so far as it may injure independent men, I believe the present Bill of the Minister of Labour will be useful. We have, however, left, in a way that I do not think this Bill sufficiently meets, the question of over capitalization and the question of the enhancing of prices through the elimination of competition. I do not know that I should use the term enhancing prices, because I will admit that prices are not always increased by the combine. However, there is an enhancing of the margin between the cost of production and the selling price to the consumer, which amounts to the same thing. In regard to overcapitalization, I think we should have a provision in our law limiting the capitalization to the actual investment or to replacement values, plus, in the case of trusts, say 10 per cent for the services of the promotors underwriter syndicate manager.


Edmund James Bristol: May I ask the hon. gentleman how he would deal with the goodwill of a business?


Morley Currie: The hon. member is a lawyer and is well versed in trust finance. He is probably well aware that that question of good-will has often been raised before. It was raised in Germany several years ago.


Edmund James Bristol: It is not a question of my raising. You speak of a replacement value, and I merely ask if you consider a good-will an asset. You apparently say you do not.	*


Morley Currie: I am trying to answer the hon. gentleman. The German government limited the capital to the actual investment or the replacement value, disregarding the good-will, and found that law to operate successfully and well. They

went further and refused to allow industrial stocks to be placed on the market until one year after the industry was in actual operation. I have' not looked into that question perhaps as carefully as some lawyers in the House have.


Edmund James Bristol: I should think business men would look into the question of goodwill, seeing that thousands and hundreds of thousands of dollars have sometimes been spent in creating the good-will of a business.


Morley Currie: That becomes a question of the assets of the trust when it is formed.


Edmund James Bristol: It is not a question of replacement, though.


Morley Currie: As I was saying, not only has that operated successfully in Germany, but some trusts in the United States have been floated on that basis; and while some hon. gentlemen may think that is not a good basis, I may say that the Union Steel Company, the Cramp Shipbuilding Company, and the International Harvester Company were floated on that basis, and floated most successfully. With regard to enhancing the margin between the cost of production and the selling price, there is a decision of the Supreme Court of the United States to the effect that while the interest of the investing public should be considered, the interest of the public is of permanent importance. It has been suggested that we should have a commission similar to the Railway Commission. I think myself that something of that kind would be the most successful method of controlling this matter. I believe that everything in the nature of a pool or combine or trust should be compelled to secure incorporation so that it would come under the jurisdiction of such a commission. The next proposal I would make is this, that this commission should have power to limit the dividend upon stock of the company, fixed as I have previously indicated. They should have power to limit that dividend to a certain amount, and to allow a further amount for the surplus fund and the renewal fund, and profits in excess of that should be used for increased payment of wages and in reducing the price to the consumer. Some one will say that is a most radical proposal; but we have at the present time such a law in actual operation in this country, that is, in the city of Toronto. We have there a monopoly, just as one of these trusts is a monopoly, in the shape of the Consumers' Gas Company. That, I think, is on all-fours with the matter we have under discussion to-night. The dividends of the Consumers' Gas Company are limited to 10 per cent upon the capital; the amount to be placed in the reserve fund is fixed; in addition, there is 5 per cent allowed for Mr. M. CURRIE.
renewals. When the reserve fund reaches 50 per cent of the capitalization, all further profits are employed in reducing the price of gas to the consumers in Toronto. That has worked effectively in the city of Toronto, and while it may be a radical proposal, I feel like saying that what we need is a consumers' gas law enlarged and made applicable to the trusts in the Dominion of Canada.


[Stage Direction]
Motion agreed to, and House went into Committee on the resolution.
John Allister Currie: Was there not a mention of this Bill in the speech from the Throne.


George Gerald King: Yes.


John Allister Currie: When a measure is mentioned in the speech from the Throne, a resolution of this kind is not necessary if there is a fixed charge on the revenue.


George Gerald King: This Bill deals with money matters and this resolution is necessary.


Thomas Simpson Sproule: It is making a charge on the revenue, and such a Bill can only be introduced by resolution.
Resolutions reported, read the second time, and agreed to.


Mr. SPEAKER.: We had better refer these resolutions to the committee on the Bill.
Mr. FIELDING moved that the said resolution be now referred to the Committee of the Whole House on Bill (No. 101).


[Stage Direction]
Motion agreed to.
Mr. KING moved second reading of Bill (No. 101) to provide for the Investigation of Combines, Monopolies, Trusts and Mergers which may enhance prices or restrict competition to the detriment of Consumers.
Motion agreed to, Bill read the second time, and House went into committee thereon.
George Taylor: I am in receipt of many letters from parties who say that before this Bill is passed they ought to be given an opportunity to be heard, and I think that the best course would be to have it referred to a special committee which will hear the parties interested. Many of my correspondents complain that, under this Bill, any six persons, who may say that they are- of opinion that a combine exists, may, because they have had a dispute with some firm, compel that firm to subject its business to an investigation. For instance a jobber may get five of his clerks with himself to make a complaint, and put a merchant, against whom the jobber has a grudge, to a lot of expense, and compel him to make public to the committee all the details of his

business. If this Bill be proceeded with, : such a contingency ought to be avoided by i providing that the complaint should come j from six different houses in the same line ; of business. That is one of the complaints against this measure. These parties say that if it be referred to a committee they would gladly come before it and make such recommendations as they may deem necessary in order that we may have a perfect measure on our statutes.


Thomas Simpson Sproule: That would shu* out the right of consumers to make complaint.


George Taylor: They would have the right to come before the committee and give evidence.


Edmund James Bristol: We have a Bill for the prevention of combines and suppression of combines formed in restraint of trade, which has been in force for some fourteen years, and under which the rights of the people have been reasonably protected. No complaint has come from the public so far as I can learn, but from some of the combines which consider they have been unjustly prosecuted. That law stands to-dav, and under it any man who feels he is aggrieved, and believes there is a combine in restraint of trade, can swear out information before a magistrate; and if a prima facie case be made out, it will go before a judge and jury in the ordinary course. This Bill is a very important measure. No doubt the public are entitled to be protected against monopolies and combines which are in restraint of trade and unduly enhance prices, but there are today very important considerations in this connection which we must not lose sight of. We in Canada are endeavouring to build up our trade in the best possible fashion, and our neighbours to the south are endeavouring to get control as much as possible of the markets of this country. Combines of necessity must arise in this country, hut not necessarily combines in restraint of trade, or in any way detrimental to consumers. It has been pointed out to-day that, in a majority of instances, the united capital and ability of combined companies are such that these combines can usually manufacture cheaper than could the isolated factories previously. I suppose there is no one in this country who would have any objection to a combine which reduced prices, or did not unduly enhance them. This Bill starts out by declaring that it is an Act to provide for an investigation of combines, monopolies, trusts and mergers, not which do enhance, but which may enhance prices, or may restrict competition to the detriment of the consumers. I do not think there is an hon. gentleman in this House who has any desire to prevent any business men of Canada combining in any lawful fashion
for the purpose of putting large masses of capital and skilled labour in the way of getting the very best results, provided the public are fairly treated. Yet this Bill starts out with the declaration that a combine of any kind, the result of which may be, if it choses to act unlawfully, to enhance prices, may be brought under its operation. I do not think that the hon. minister has any such intention. I think the Act should provide that only such combines as do enhance prices and restrict competition should be dealt with.


George Gerald King: How does my hon. friend purpose to discover a combination of that kind until there has been some investigation, how will he be able to show that the combination comes under the class he is speaking of?


Edmund James Bristol: As I understand, six persons have to come forward to make a charge of that kind, because section 5 says: Where six or more persons are of opinion that a combine exists, and that prices have been enhanced. That is why I thought the body of the Act implied what I am arguing for, that you might have a perfectly fair, and reasonable combination that might reduce prices, and I did not think the minister had any objection to that. Section 5 indicates that that is the intention, but the minister starts with a heading which I do not think is justified. I merely raise the matter for consideration at 'this stage, because I feel that we have to give Canadian manufacturers as well as Canadian workingmen every reasonable chance for competition on fair grounds. We have a Tight to protect the public, and those engaged in manufacturing, and the idea is to put down monopolies that increase prices or unduly restrict competition.


Samuel Barker: In the province of Ontario there have been rather extreme cases of wrong and injustice, arising out of an attempt to prosecute men under the Combines Act; and as those men have been exposed to cost, and serious interference with their business, I think the House ought to he very careful before they go any further in this direction, without taking the utmost care not to repeat the absurdity that now exists. The whole question turns upon the one word : 'unduly.' The hon. gentleman has dwelt at length on that. There is no wrong in people combining to restrict production or l to enhance prices, the hon. gentleman ad, mits that, but it is wrong to unduly restrict , or unduly enhance. No merchant knows, no [DOT] manufacturer knows, as a fact, whether * what he is doing is undue or not. One man . may be of opinion that he is acting unduly, ' another man will say the very opposite, and E the law now requires a manufacturer or a i merchant to take his risk of being a crim-

inal. That is the position, that has been the position, and what the merchants, and others complain of is that if they come here to the Department of Trade and Commerce to ascertain whether what they propose to do is legal they cannot obtain any information. They may say that they find it absolutelv essential in the interest of trade to restrice production beyond a certain amount because if they flood the markets with ready-made clothing, for instance, they will cause injury to business and injury to the public interest. Perhaps half a dozen manufacturers of ready-made clothing meet, and come to the honest conclusion that there is danger of an excess of production in that line, doing no good to anybody, and that the output should be restricted to a certain amount. These gentlemen are confronted by this statute, and somebody says that "they must not do that unduly. I know that people in that position have come to Ottawa, and have naturally gone to the Department of Trade and Commerce to get some hint or indication of how far they might go, what would be considered reasonable, or when their conduct would be an undue restriction of trade or an undue enhancement of price. The Department of Trade and Commerce say that they cannot advise them, that they must take thee risk of doing this thing unduly or that they should go'do the Minister of Justice. The Minister of Justice says that it is a question of fact, and they must go to a jury to have a decision whether their action is reasonable or otherwise. Then these people, as respectable as any in the Dominion, wishing to keep within the law, knowing from their business knowledge and believing that what they do is right, and reasonable, proceed with what they have proposed. What is the result? Somebody takes it into his head that he can worry these men and knowing that it will not cost him one cent, that if he lays an information the government will have to bear the expense, and will conduct the prosecution in the name of the Crown, a prosecution is begun.


George Gerald King: Is the hon. gentleman speaking of this measure or of the law as it stands?


Samuel Barker: The law as it stands.


George Gerald King: The legislation enacted in 1899.


Mr BARKER.: I do not want to have the minister perpetuate that injustice. A notorious case has occurred, the orosecu-tion of the Grocers' Guild. These people were charged with being a combine, and for three or four years they were held up to the people of this country as criminals. The outcome of that three years' prosecution was that the Chief Justice of Ontario Mr. BARKER.
held that they were within the law, that they had never exceeded the law in any sense, that their action did not come within the meaning of the word ' undue '; but these gentlemen only found that out after three or four years' litigation, costing them in round figures $12,000. The people who were prosecuting them were safe, the whole thing was done in the name of the King, and those who caused all that expense, trouble, annoyance and injury to the men concerned, got off scot free. The minister, before proceeding any further in experi ments on this law, should take the utmost care that he is right. I do not think the members of this House are the best people to judge exactly what the change should be. The minister may have considered it with great care, I presume he has, but I do not think that even the minister has the knowledge or the experience to judge how far he should go or how far this House should go in altering, this law. I have no doubt that some years ago when the House put in the word ' unduly ' they thought they were settling the whole thing. I hope we are not going to do any more blundering of that kind. I think that the proper course for the minister would be_ to refer this Bill to a special committee, who will give to all concerned an opportunity of coming before them and discussing these matters. We may then learn from experienced men who know all the difficulties and who can speak with knowdedge. We should not make another blundering attempt to deal with a subject of the utmost difficulty. We are now going^ to submit to arbitration the very question that, in the past, has been found so difficult to deal with under the present law. Some gentlemen who have considered the matter with a great deal of care, think there ought to be an opportunity given to them, through some department of the government, to know in advance whether what they are proposing to do is likely to make criminals of them or not. We have a Department of Trade and Commerce here, I do not know exactly how broad the functions of that department may be, but surely that department and not the De-parment of Labour should be the forum where questions relating to trade and commerce may be discussed. Now if we are going to spend large sums of money in this sort of arbitration-and as I understand the minister, the country is going to stand the shot on both sides, as a rule-we mivht better spend that money in enlarging, if need be, the scope of the Trade and Commerce Department, and keep these 'people out of crime rather than letting them into it, and then punishing them for it.


Edmund James Bristol: I want to add that in addition to the state of affairs which the

hon. member for Hamilton (Mr. Barker) pointed out continuing to exist, as it will, whether this law is passed or not, and, therefore, people will still be subject to prosecution as they have been in the last fourteen years, I want to point out that this Act goes beyond the criminal law in one most material respect. The criminal law under which prosecutions have heretofore been conducted, subclause (c), reads as follows:
Every person who conspires, combines, agrees or arranges with any other person, or with any railway, steamship, steamboat or transportation company ... to unduly prevent, limit or lessen the manufacture or production of any such article or commodity, or to unreasonably enhance the price thereof.
Is guilty of a misdemeanour. Now, the Minister of Labour leaves out the word ' unreasonably ' before the word ' enhance,' and that makes this new Act go beyond the criminal law, which has already given the business men of Canada enormous difficulty, and put them to enormous expense, men who are honestly desiring to live within the law. I know that business men have come to consult me, asking an explanation of the words 'unduly' and 'unreasonably', and I have told them that they would have to go before a judge and a jury to get an explanation. The law as it is now suggested reads: 'An Act to provide for the investigation of combines, monopolies, trusts and mergers which may enhance prices, not which unreasonably _ does enhance prices,' which would be in accord with the criminal law to-day. There is not a business man in this country who does not know' that there may be a dozen causes which make it perfectly proper for prices to advance in the future as there may be a dozen causes which may make it proper for prices to be reduced. But there was under the present Act the possibility that prices might be enhanced reasonably and yet that would be an offence. This Bill says that when six men are _ of opinion that something of this kind is occurring, they may actually put the business men of the country to the expense of having this investigation. But that it is not the worst part of it. Anybody who has had anything to do with these prosecutions knows that everybody attacked has got to produce all his books, ledgers, letter books, invoices and other documents by the hundreds or thousands, that the whole of his business is turned upside down, that the books w'anted in daily use are one time in the court and at another time somewhere else, instead of being in his office. He is put to all kinds of inconvenience and expense other than mere legal expense, when he is trying to act in good faith, and this Bill actually
goes beyond even the criminal law o! to-day and makes it worse for the business men of Canada than it was before.


Mr. GERMAN.: It appears to me the hon. gentleman who has just taken his seat (Mr. Bristol) somewhat misconstrues the true meaning of this Act. As I understand it, the Act substitutes a board of arbitration for criminal proceedings before a judge and jury.


Edmund James Bristol: It does not do it, for obvious reasons. First of all, the criminal law is not repealed, it is nnnply enforced, and anybody can start a prosecution. Secondly, I quoted the criminal law, and I have shown that the word 'unreasonably' is left out before the word 'enhanced' in the new7 Bill.


William Manley German: I agree that that portion of the Criminal Code is not repealed, but instead of substituting I might say it amplifies the proceedings under the Criminal Code by giving the right of arbitration, which seems to me a milder procedure than taking proceedings under the Criminal Code.


Edmund James Bristol: Anybody can still lay an information.


William Manley German: They can if they choose. But to take proceedings under the Criminal Code you are immediately up against all the legal technicalities that can be raised; whereas a board of arbitrators is more inquisitorial than judicial. The board of arbitrators can go into the matter on equitable grounds, they can make a broader inquiry than could be done in proceedings under the Criminal Code. Any six men can lay information and make a complaint, then the arbitrators are chosen, one for each side, and a third is selected by the tw'O. The men complained against are not supposed to be criminal. Then if the board of arbitrators find that they are unduly and improperly, by their combination, enhancing prices or restricting trade to the detriment of the public, they then make their report. If, after the report is published in the 'Canada Gazette', these people continue to violate the spirit of the law, then they are subject to a penalty of $1,000. It seems to me this Act is quite an improvement on the Criminal Code. The Criminal Code will not be invoked if this Act comes into force, and you will have more ample justice done in all such cases than you will have under proceedings under the Criminal Code, which are expensive and liable to all sorts of legal technicalities. These proceedings will be inexpensive, thev will reach the end of justice more speedily and more equitably than any law at present on the statute-book.


John Allister Currie: Evidently the House is of opinion that this Bill removes those clauses which 'provide for prosecution under the Criminal Code.


Some hon. MEMBERS: No.


John Allister Currie: Then, we will assume the position to be as it actually is. This law provides a convenient form of investigation into the affairs of a business concern, in other words, it is an inquest. It is suspected that there may be a combination, not that there is a combination, but that there may be. Immediately an investigation is set on foot, and provision is made under this Act whereby there are arbitrators appointed, who are to hear all this evidence without being under the rules of evidence, they are not governed by the rules of evidence.


William Manley German: Certainly they are governed by the rules of evidence.


John Allister Currie: You will find they are not. They are in a similar position to the Railway Commission, and they will not he governed by the rules of evidence. They will conduct their investigation in their own way, and they will have the power to go into the business of everybody and into everybody's books. When their finding is published in the ' Canada Gazette ' anybody can carry on a criminal prosecution, and he will have all the evidence that has been taken, by this investigating committee-this detective committee-to make a criminal out of the man who has been investigated. I think in justice to the business interests of the country, the minister should send this Bill to a committee, and those people who are crying out so loudly and writing those articles in the paper should be asked to come and substantiate their charges. I do not think there are very many combines in this country. There is every reason why we should not go beyond the straight, fair way of dealing as between man and man and as between man and the law. A man should not be found guilty before he is tried. In an ordinary criminal case, if a detective acts in this manner and gives a man, charged with a criminal offence, what is known as the third degree, the jury dismisses the case and there is a mistrial. I do not think the minister realizes how far reaching this Bill is, and I think that in justice to the business interests and to all interests involved, it should be referred to a committee so that we might have an opportunity of hearing about these combines. There is no evidence of a satisfactory character to show that there are any combines or that combines are unduly enhancing prices. I understood that an arrangement had been made between the whips whereby this Bill should be referred to a special committee.


Mr GERMAN.: 


George Gerald King: There was no such arrangement made.


John Allister Currie: The chief whip told me there was such an arrangement.


George Gerald King: There was not.


Frederick Forsyth Pardee: There never was such an arrangement made.


George Gerald King: The hon. gentleman might possibly have misunderstood.


John Allister Currie: The minister is putting himself up as the chief trust buster of this country. They have had trust busters in the United States, but men who go about trust busting do not happen to travel very long in public life. I think that in justice to both sides concerned, the consumers who are ground down, according to their lights, and also the manufacturers and business interests, which are liable to be. prosecuted under this Bill, should be heard before any action is taken. I think we may be able then to get a Bill that will reach this difficulty. Supposing that this Bill gives the right, which has not been given in any British country, to lay a charge and investigate any man's business, persons may take advantage of it for political or religious reasons, or they may do it out of mere spite, because there are men who are so mean that they do not wish to see their fellow men succeed in making a little money. They may do a man an enormous amount of injury, they may ruin him, because if they start an investigation the banks will refuse him credit. There are legal gentlemen on the other side of the House who will appreciate the situation. Is a man going to be considered a criminal, is he going to be investigated in reference to his conduct, character and business relations under this Bill? This commission may free him but that does not mean that some enemy of his cannot level a prosecution against him under the Criminal Code. You must amend the Code if you are going to put this Bill into force. Two clubs are two too many. For that reaston I make the suggestion that all parties be heard before a commitee of the House.


Mr. CONMEE.: I do not think the Bill will have the effect that the hon. gentleman has stated. It seems to be a more moderate means of investigating such questions.


John Allister Currie: But there is the Criminal Code, and it does not take the place at all of the previous Act.


James Conmee: Admitting that criminal proceedings may still be taken, it is not reasonable to assume that both lines of action would be taken. A person would be far more likely to take action under this Bill, because he would not be required to

accuse the other party of any criminal conduct. It is a mere investigation, and there is the safeguard. It takes six persons to secure this investigation. One may make a complaint under the Criminal Code. Then, there is the further safeguard that a complaint is made to a judge of the High Court and he may refuse the investigation. He may not find sufficient grounds. That means that a man's business is not wantonly dragged into the daylight. But, if he does find sufficient ground the investigation has to go on, then who is appointed to hold the investigation. One is appointed as the representative of the parties making the complaint and the other is nominated by the party accused. If they cannot agree, a third is appointed by the minister. What happens if there is an investigation? As far as I have gone into the Bill, I must say that I approve of it.
I think it is a timely measure, and I am not going to worry myself very much as to whether they have such a measure somewhere else or not. It looks to me to be a good measure for Canada, and if so, it is sufficient for my purpose. Subsection 2 of section 18 reads as follows:
In deciding any question that may affect the scope or extent of the investigation, the board shall consider what is required to make the investigation as thorough and complete as the public interest demands.
I submit that is one great step in advance. Then, the following section provides for publicity and if there is anything that will tend to give the consumers fair play it is the fact that the light of day may be let in on the whole transaction by a board whose only object is to see justice done in the public interest. It is generally assumed and I believe it to be true that there are in existence combines which injuriously affect the public, and enhance the price of commodities that are used generally by the people.


John Allister Currie: What about dredging?


James Conmee: My honoured friend has something on his brain, and he very often tries to enlighten the House, but he seems to have so much mud about it that no one understands it except himself. I am not discussing this frivolously. So far as I have looked into the Bill it contains a great deal of good, and I would judge that my hon. friend the hon. member for Toronto (Mr. Bristol) does not understand the Bill as I understand it. It seems to me that having regard to the legal capabilities of the hon. member for Toronto (Mr. Bristol) he ought to be able to see good and not evil in this Bill. I confess that" before I read the Bill, taking only the comments in the press, I had not a very high opinion of it, but since I have gone over its
provisions, I am quite in sympathy with it, and for my part I should like to see it become law.


Glenlyon Campbell: I have studied the Bill, and I have listened carefully to the lengthy speech of the junior minister. His verbosity was such that I really could not understand what he meant, and I doubt very much if he understood himself. He referred to the fact that the father of my seat mate had gone into the matter so thoroughly in 1888 that this Minister of Labour thinks to-day that the evidence then collated was sufficient to induce any government to take steps to protect the public. The minister used that as an argument against the Conservative administration, but I would point out that for the fourteen years this government has been in power, day after day, and month after month, and year after year they saw that combines were being formed against the public interest: lumber combines, cement combines, machinery combines, meat combines, all calculated to plunder the public, and the government during these long years never raised a hand to protect the people. Well* the only excuse for the minister's argument is his youth. During fourteen years this government has never done a single act to protect the farmers of the west from being eaten up body and soul by these combines, their farms mortgaged, their children half naked in some instances. At last, this gracious government, and its Minister of Labour has awakened from their Rip Van Winkle sleep, and so they now propose to do something. In 1888, Mr. Clarke Wallace brought out the fact, that there were thirteen combines in Canada that needed to be combatted, but the Minister of Labour is a member of a government that has created a fish combine, one of the worst combines that has cursed the west. It was his government that gave the people up in the northwestern part of my riding, a monopoly of the fisheries for a mere trifle, and which for a mere song, threw away to a few grafters and party heelers the heritage eff the people of that western country. I say grafters, and I mean every word of it. Suppose the Minister of Labour does not know about that just as he knows very little about any subject that I have heard him discuss in this House. This government, of which he is a member, gave to Coffey and Merritt, the fishing in Cedar lake, 285 square miles of the finest fisheries in the west; they gave away in Moose lake 522 square miles of sturgeon fishing; in Cormorant lake 140 square miles; in Cumberland lake 166 square miles, in Amiak lake 90 square miles, in Namea lake 66 square miles, a total of 1,300 square miles for the paltry sum of I $300 per annum. To these people this

government gave a fishing monopoly, which is absolutely another word for a combine. And the result is that the gentlemen who got that monopoly from this government sold that monopoly to an American fish firm. The winter season is the only season of the year that fishermen have a chance to be independent, and to sell their product in the highest market, but these poor fishermen, under an agreement made with this government, were compelled to sell their products to this Northwest Fish Company of Americans for from one cent to one-and-three-quarter cents per pound less than they could get in the open market. It was the officials of this government who compelled the poor fishermen to do that. In the winter of 1907-8, the fishermen were compelled to sell their product at less than market prices all through the winter, and in the spring of 1908 the company went into liquidation and became bankrupt. I read affidavits last yeai', and I am going to read them now, from men who produced the fish sold to the company, compelled to be sold to this American company by the officials of this government, who have awakened to the fact that they had to protect the people at this late day. These fishermen had to sell at less than market prices, and when this American company went into liquidation, they could not get even the poor recompense that they were compelled to accept for their output. I will now quote an affidavit which I read last year:
This is to certify that I, Isaac Bradbury, fished during the winter of 1907-08 in the waters covered by Capt. E. D. Coffey and F. L. Merritt's leases in the Northwest Territories, and was forced to sell my catch by the government officials to the Northwest Fish Company, which is represented by Capt. E. D. Coffey and F. L. Merritt, and that the Northwest Fish Company went into bankruptcy and owe me $810 for my winter's labour.
This affidavit is declared before George O. Bellamy, and is signed by Isaac Bradbury, fisherman. I brought this matter up last year before the Minister of Fisheries, who promised me explicitly in this House that he would have his commissioners inquire into this matter and protect the producers; but no effort has been made to protect my friend Mr. Bradbury, and other men who are in the same position. I had another letter from Mr. Bradbury the other day. He states that he had a letter from me saying that the Minister of Marine and Fisheries was going to investigate the matter, and he goes on to say:
I think he should, for the government gave that Northwest Fish Company the privilege of getting the fish out of those lakes for practically nothing, and now the property that we, the creditors, have to fall back npon to get paid for our fish is worth Mr. CAMPBELL.
nothing, for the lakes are pretty nearly cleaned out, and it is no good for any company to buy. I think the government should consider me and the other creditors the way that we have been used. It would have been bad enough if the Northwest Fish Company had paid the $80 per ton. That was u.. price they were to pay, hut at the same time the Armstrong Fish Company were prepared to pay $110 per ton for the same fish, hut we could not sell to them, for the government officials would not allow us. We were forced to give them to the Northwest Fish Company, which was pretty hard on me, for I had to hire my men, and what little money I did not earn I had to pay out. The hardship of fishing is very great, and I think this is a case where the government has a right to protect the poor producers as against the company that holds the fishing under a special license.
I am quoting that for tlie reason that this was a monopoly created by this government for the benefit of an American organization as against Canadians, and through it the resources of Canada were dissipated in a wrongful manner. It seems to me absolutely hypocritical for any member of a government to get up and make a speech such as was made here to-day by the Minister of Labour. The government cry anti-monopoly while they grant such monopolies as this. I was very much pleased to hear my hon. friend from Thunder Bay and Rainy River (Mr. Conmee) tell the House, and I am sure the House appreciated his remarks at their full value, that since he had been in public life he had been out for fair play to the public. I have put a very different interpretation upon his actions since I have known him. I may be wrong in some cases, but in this case I think I am not wrong in my interpretation, but he is wrong in his. That is all I want to say at present except that I agree with the proposition of my hon. friend from Simcoe that this matter ought to be put into the hands of a committee to investigate it most thoroughly. We know all the facts. All we want is the evidence, and when we get that, we want to send the perpetrators of harm to the place where they belong, and that is the penitentiary.


Mr. NESBITT.: I have learned within the last few minutes that it is wrong to be young. I think the hon. minister's most bitter enemy must acknowledge that he has introduced and placed before the House this measure in a most capable manner. We are now, I understand, considering clause 1, and I think we should consider the various clauses of the Bill as we come to them. There are some amendments which I would like to see made to the Bill as proposed. I agree with the principle of the Bill, and I would like to see it advanced by considering the different clauses, and amending them if necessary as we come to them. I am quite sure that the hon. min-

ister wants only what is right, and is perfectly willing to insert in the Bill any amendment which will make a better Bill. I quite agree with my hon. friend from Toronto that the word may in the preamble is too wide, but I do not think we are now considering the preamble. If we are considering the preamble, this is the proper time to consider its wording, but if we are considering clause 1, I do not see any reason why we should not go on with its consideration, and not with that of the preamble.


Mr. DEPUTY SPEAKER.: Clause 1 is the clause before the committee.


Mr. MACDONALD.: Any one who looks at this Bill closely from a legal standpoint and endeavours to ascertain the ultimate effect it is likely to have, can imagine many difficulties which should demand from this committee the closest deliberation. There is a popular idea that anything devised under the name of a combine should be . condemned and blotted out of existence by legislation. I was unable to have the opportunity of hearing all the discussion, and, therefore, speak with the disadvantage which always comes from . that circumstance; but on examining this Bill with some little care, I realize that, so far as the definition of a combine contained in it is concerned, a combine in an illegal sense-because that I assume is what is intended by the definition-would, under its wording, cover every kind of organization, whether legal or illegal, in the sense in which we understood a combine in the past as a matter of law. The common law of England always applied only to such combines the effect of which would be the unreasonable enhancing of prices and bringing about a condition which ought not to exist.


Edmund James Bristol: Does my hon. friend observe also that, in considering clause (e), what I was pointing out is true, namely, that clause (c) gives an interpretation to a combine beyond what the criminal law does, and I do not suppose the hon. minister wants to go beyond the present law.


Andrew Archibald MacDonald: I was endeavouring to point out that a combine, as defined in this Bill, includes not merely those combines which are in the restraint of trade and which, in the past, were regarded by statute as well as by common law as illegal, but also those which in the past were always regarded as proper.


Edmund James Bristol: Quite so.


Andrew Archibald MacDonald: In that sense the definition is a very wide one, and I apprehend that the difficulties which may arise from the passage of this Bill may be
very great indeed, and ought to demand the closest deliberation and care from both sides of the House, irrespective of party.
In order to show that we ought not to legislate so as to declare that understandings or associations of business men, which may be called combines, are necessarily of such a character that they should come under the ban of the law or' legislation regarding combines, I would draw the attention of the committee to the condition of affairs which exists in England with regard to the various trade associations there, and which have existed right along. Some hon. gentlemen say that these combines only arise in countries where you have a protective tariff, but that these combines are to be found in England and are recognized and approved there is evidence that they are not exclusively due to that cause. Thus in March, 1908, no less a number than sixteen firms of spinners and fifteen firms of doublers in the spinning trade of Lancashire combined together. Their avowed object was not to create a monopoly, but by the centralization of office work and buying, selling and distributing arrangements, to lead to considerable economy. In addition to this, important benefits were expected to arise from an organization which would gradually provide that each mill should spin and double only those numbers and qualities to which its machinery is best adapted. Another advantage was expected to accrue from the application to each individual concern of the combined practical experience of the whole of the board of directors, exclusively composed of experts in that branch of business.
It is stated in this book from which I quote, which is entitled 'Trusts and the State,' and which is one of the Fabian essays, considered authorities upon this sub- ' ject, that these arrangements of trade are considered eminently proper. Some of the advantages are set forth in this work which flow from the association in business of people who are experts in the various branches. Take another industry, one which exists in a large degree in my own province. I refer to the coal mining industry. This book says:
The great foundational industry of coal mining might be expected to offer special facilities for combination of interests, as it is strictly limited in extent.
It refers to the combine arranged by Sir Geo. Elliot, a leading spirit in coal mining in England, and proceeds to say:
After setting forth the disadvantages under which individual lessees at present labour- the necessity of leaving boundary walls of coal unworked, the unnecessary increase in the expense of pumping, ventilation, and underground haulage, -which have to be treated, not in the most convenient manner, but according to the arbitrary divisions of

'ownership-Sir Geo. Elliot said:	' Briefly,
the efiect of amalgamation, it is contended, would be to remove all the artificial factors which now stand for so much in the sum of the coal mining industry and to leave science and nature face to face. The different coal districts would then be treated each as a whole, according to its geographical peculiarities. Under a more fully organized method of working, the whole of the coal) good and bad, could be systematically extracted, instead of being as now largely wasted for the sake of bringing up only those kinds which produce the highest market prices.	.
I could read various other extracts which go to show that these arrangements have worked beneficially and that the combines were eminently proper and ought not to be condemned by legislation. I have in mind a condition which exists in my, own county, where we have two coal mines in the one community working side by side. One of them works actually under such conditions that it is impossible for it to exploit a large quantity of its area. The adjoining company, which is separated from the first one by a barrier which has to be left, under the laws of the province, could advantageously work out this coal which is lost to the first. Would It be said that it would be improper for those two companies to combine and mine that large quantity of coal which, on account of the division of ownership, it is impossible for either to obtain.
When we are approaching the question as to what should be done regarding combines recognized as improper we should not throw into the pot these organizations which are proper and put them to the peril and risk of an extensive investigation that may be imposed on them under this Bill, or any peril to which only improper combines should be subjected. The effects of this Bill would be, to my mind, to create conditions under which a proper combine would be attacked just the same as the others. My hon. friend from Toronto (Mr. Bristol) has pointed out that the effect of legislation in the past has been to make a combine a crime where it caused an unreasonable enhancement of prices or an undue limitation of competition. If you look at section 496 of the Criminal Code you will find that a conspiracy in restraint of trade is an agreement between two or more persons to do or procure to be done any unlawful act in restraint of trade.
So far we have only put under the ban those combinations and arrangements where the agreements between the two parties is to do the unlawful act. Then we make unlawful the combination of people whose object it is to unduly or to unreasonably enhance the price of goods. You must have the undue result, the unlawfuj result, or you must have the unlawful act. That is the position of the law to-day.


Andrew Archibald MacDonald: That is all right, those are combinations that ought to be attacked and prevented. If you have a combination of men in any business who combine together with the avowed object of increasing the price of any of the articles of necessity in life, that is an agreement against the state and the state should deal with it accordingly; but where, on the other hand, you have combinations such as I have indicated, existing in the various trades in England and in Canada, for their common interests, or for the purpose of saving fixed charges which are always an important consideration in manufacturing, for the purpose of obtaining the advantage of the knowledge and experience of men interested in trade together, there is a very marked line of divergence and that line should be maintained; we should hesitate before combining these two things together and dealing with them on the same basis. Of course one approaches the consideration of a measure prepared with great care by the minister, as I am sure this has been, and sympathetically view it as intended for the purpose of remedying some alleged evils, but when I find the section defining a combine as an agreement which has or is designed to have the effect of increasing or fixing the price-not unduly increasing it but merely fixing the price-I say we are passing from the realm of legislation where we have dealt with this thing in the past or where it has been dealt with under our. jurisdiction here and elsewhere, and coming into a new realm. I say it is not, as I have been able to read the cases or study the conditions, an improper thing for men interested in the same business to agree together about increasing prices, if they do not do it unduly. Suppose there are competitive trade conditions in this and several other countries and you have an industry which has been for a long time lagging indifferently as the result of competition with the United States and the price of the commodity goes up all over the world, the labouring men working in that industry have perhaps been struggling along at low wages because they have been unable to get as full return for their work in that industry as their brethren in some industry alongside; do you mean to say it is improper for the people interested in that trade to increase the price because the price of that commodity has gone up all over the world and let the men work in the industry have the result of that increase? I say I do not so regard it. It may be that there are some other sides to this matter, and I am approaching the consideration of it with the greatest care with the desire to arrive at a solution, but it does not seem to me we should create the position of penalizing a condition ol that kind. When you call a combine an agreement among business men to fix the

price, when it is not done unduly or unreasonably, you are rendering the problem as to whether you should deal with this matter somewhat more difficult. This section of the Bill speaks of an arrangement for an agreement which is to have the effect of increasing or fixing the price. Within what area in this Dominion are you going to fix the limits within which the understanding between the parties as to price is to be determined? For instance, if certain gentlemen in the province of Ontario engaged in the manufacture of some particular article peculiar to this province, agree to fix the selling price, how are you going to arrive at a decision _whether or not that is a price which is improper or which ought to be increased? It may be a price which even at the increased figure is less than that which is sought by some gentlemen engaged in the same business in another province in the Dominion under more advantageous circumstances.


Samuel Barker: They could not even lower the price.
. Mr. MACQONALD. Yes, my hon. friend is right, under this language you could not lower the price.


William Manley German: Does not the hon. gentleman see that the whole gist of the Act is that this must be to the detriment of the consumers? Clause 5 clearly says it is to the detriment of the public.


Andrew Archibald MacDonald: My hon. friend has read something with which I propose to deal in a moment. I am now pointing out that the definition of the word ' combine ' means the legislative ban being put upon certain understandings and arrangements which are included in the definition of that word and I object to that.


Edmund James Bristol: The words 'to the detriment of the public ' are nowhere contained in the definition with which my hon. friend is dealing.


Andrew Archibald MacDonald: I know that. At the conclusion of that section we also find that another legislative ban is being placed on a proposition that in the past has always been regarded as an eminently fair and reasonable one. After dealing "with various things, it says that this includes:
. Tlie acquisition, leasing or otherwise taking over, or obtaining by any person to the end aforesaid, of any control over or interest in the business, or any portion of the business, of any other person.
The result is that if a man has been eminently successful in the prosecution of an industry and he and his business associates have made money, and there is perhaps in the next county or province, another concern engaged in the same trade which is not so prosperous, then under this Bill 220
it is impossible for the prosperous and successful man to obtain any interest in the other business, and there is no opportunity for the successful man to expand. Supposing the other situation affords very great facilities for manufacturing, but that there have been some conditions which always may arise in business, through incompetency or otherwise, which prevent the second man from succeeding, then you do not permit the first successful man to obtain an interest in the other business with a view to resuscitating it, extending it or making it a success. It is true the words are limited by the words ' to the end aforesaid.' But if the result of the combination is that you are going to have joint control, of course there can only be one end of it, and that would be that the price between those two friendly concerns would be fixed. I think this is a proposition that ought to be carefully considered, because unless you do that you will impair the capacity to obtain capital in this country. If we do not preserve the safeguards for proper business arrangements, the opportunity to obtain capital will be impaired and after all, while we have had filtered into Canada, as you have seen it in the United States in the yellow press, a lot of talk about trusts, monopolies, and all that sort of thing, we sometimes forget, because we are alongside this great country with 80,000,000 people that we are only at "the threshold of our career, that we have only 8,000,000 people here, that we have not begun to develop our resources, and that what we want, above everything else, is to encourage the infusion of capital into Canada. What we want in this country is to encourage capital to come in, and ensure that it shall have safe returns, and that capitalists shall not be attacked improperly or illegitimately by legislation. Unless we do that I do not know where we are going to land in Canada. What we want to do is to legislate against those combines which unreasonably affect or unduly dislocate the business conditions of the country. My hon. friend from Welland (Mr. German) says that no proceedings will take place unless prices have been enhanced, or unless you have some bad result from the combination. Now my hon. friend is a lawyer of great ability, he knows that a judge under this Act is not even called upon to ask that a prima facie case shall be made out. A prima facie case, I understand, is one upon which a judicial tribunal would be bound to decide in favour of the party making it unless it is answered in some way. The way in which these proceedings are taken is that a party files a statement alleging certain things. He does not need to give any grounds for his belief, but he merely files the usual declaration that to the best of his knoivledge and belief certain conditions exist. Then he goes before the judge, and

692i>
if tlie judge is satisfied not that a prima facie case is made out, but that there is reasonable ground for believing a combination exists-


William Manley German: Is that not a prima facie case?


Andrew Archibald MacDonald: No, reasonable grounds simply means that there is a plausible case made out which might be inquired into.


George Gerald King: And that it is in the public interest that an -investigation shall be held.


Andrew Archibald MacDonald: That is where I find a difficulty with the minister's definition of a combine. The judge will look to see what is the public interest, and he will find that the public interest means anything contrary to what is mentioned as coming under the definition of the word 'combine'. Let it be understood that I am speaking here purely and solely from the standpoint of a friendly critic, who apprehends that out of this 'Bill you will have a lot of difficulties which require the closest possible examination. Perhaps some of my objections are not tenable, but it seems to me some of them are worthy of consideration. Now, I happen to have had an experience not long ago carrying through a case which affords an example of the difficulties you would have under this Bill. A certain number of gentlemen, not with any desire to advance the public interest, inaugurated a proceeding under section 498 of the Code against certain coal proprietors in the province of Nova Scotia. The inquiry, to which great latitude was given by the magistrate, was very much along the lines required to take place under this Bill. It was protracted for two or three months, at tremendous expense to the defendants. It involved all the managing people connected with this industry being in attendance before the tribunal, and ultimately, under the instructions of the judge who charged the grand jury, the case was thrown out. There was an illustration of an investigation such as might Jake place under this proceeding here. I think there should be certain limitations. The judge ought to have power to say to the parties who come and invoke his authority that they should be compelled to give security for costs under certain conditions. I think also that the party against, whom the 'allegation is made should have the right to appear by counsel at what by the Bill is ap ex-parte application, and that under that section 7 all precautions should be taken to protect the honest man, to protect the gentlemen who are interested in arrangements which are Mr. E. M. MACDONALD.
bona fide. Although the hon. member for Welland drew the distinction that there must be injury to the public alleged, anybody who comes within the definition of a combine under section 2 of the Act, is open to be attacked, and the only thing that these six men need do in order to attack him is to allege that they have information that he and his associates have done something they ought not to do, and which might be detrimental to the public. Now, we must not lose sight of the fact that business interests may be seriously affected if you open up an avenue whereby business men can be kept away from their business for a long period of time; that they can be harassed and annoyed by the compulsory production of their books and papers, covering a long period of years, ultimately to find that after all there was nothing improper in connection with the matter at all. _ You can fancy what the feelings of legitimate business men would be who are put to all the trouble and expense of an investigation, at the instance, perhaps, of a coterie of men who want to do them*an injury. They could not get back at their assailants by an action at law, the same as they could if they were charged with crime under the Code. It seems to me there should be some clause giving a right of action, and in addition, compulsory security for costs in proper cases, to be paid if' it is found that there was no reason for proceedings being taken against them.
Now, there have been very satisfactory results on the whole in the operation of the law as it stands. We have had decisions by which a coal combine at Brantford was attacked; we have had several convictions in Toronto; in the northwest a lumber combine was convicted under the present law; and numerous arrangements have been held to be illegal; and contracts based upon them have been nullified by the courts during the ten years this Act has been in operation. I would say to the minister that I hope, if he does not accede to the request that the Bill be sent to a special committee, that he will give consideration to the suggestions which will be made by which men honestly making a business arrangement with their fellow men shall be protected and secured in this measure. Now, I have to revert for one minute to this first clause. _ It does seem to me it is a hard proposition to say that because one man has been successful in business that he cannot go and buy up a concern which has been engaged in the same business, and which has gone into bankruptcy, that he cannot carry on and increase his business, that he cannot have two or three concerns going on anywhere in the Dominion at the same time.
6 925


Mr. LANCASTER.: Simply because some judges think he ought not.


Andrew Archibald MacDonald: Judges have their whims and humours in regard to these matters, and in these matters they are acting in an extra-judicial capacity. With all deference to the learned gentlemen in my own province who have occupied seats on conciliation boards, I think it would have been very much better if these judges had not been on these conciliation boards. While it would be desirable, if you are going to have a board, to have somebody who is acquainted wtih the law, I do not like these extra-judicial duties being performed by the judges of the country.


Edward Arthur Lancaster: You are practically making the judges a parliament. The judges provide what the law shall be.


James Conmee: They have the power to order an investigation.


Edward Arthur Lancaster: No, the judges decide what is an improper combine instead of saying what it should be.


James Conmee: No, the judge only goes as far as to order an investigation.
Air. A1ACDONALD. This Bill is inaugurating a new and novel principle, inasmuch as it deals with the rights of innocent business men carrying on their business in the same way as it has been carried on in this country and in England, and in a. way which is expressly recognized in England. As this Bill is going to seriously interfere with all these conditions, I have endeavoured to point out some phases of it which require consideration, and I would ask the minister, if he is unable to agree to refer the Bill to a special committee, to give us the widest possible attention with regard to any amendments which may be proposed for the purpose of protecting honest business men who make arrangements. I have made these few remarks with the idea of having all join together in this House so that if any measure is to be adopted, it may be made as satisfactory as possible.


George Gerald King: I have listened rather carefully to the discussion which has taken place, and it seems to me that the general opinion, as it has been expressed, is favourable to some measure passing this parliament which will more effectively deal than any legislation on the statute-books at the present time with trusts and combines that work an injury to the public. The only difference that I see in the main in the discussion is that while there are some gentlemen on this side of the House who would like to see certain amendments inserted and have the present law made a little clearer in certain particulars, there 2204
seems to be, on the opposite side of the House, a very decided desire to, if possible, burk legislation altogether at the present session.


Some hon. MEMBERS: No, no.


George Gerald King: I beg the hon. gentlemen's pardon if I have misunderstood their motive. We are now within a short time of what is desired to be the prorogation of this parliament and any suggestion that the Bill should be referred to a select committee at this stage of the proceedings of the House can only be taken to mean that it shall not pass this session.


Edmund James Bristol: Was it not possible for the minister to have brought this Bill down before?


George Gerald King: The Bill was brought
down on the 18th of January, and from that time until to-day no suggestion has been made to me or to any member of the government that the Bill should be referred to a select committee. If hon. gentlemen had any desire or intention of that kind, they were at liberty to exipress it to any member of the government at any time. They need not have reserved that suggestion until this present stage of the session.


Richard Blain: There was a general rumour abroad that the government would not proceed with this measure at all.


George Gerald King: The government cannot be responsible for the rumours that are abroad.
I have no doubt that hon. gentlemen opposite do not desire every one to accept certain of the rumours that are abroad at the present time.


Glenlyon Campbell: The objection I have at this stage is that the government is some years too late in bringing forward this legislation.


George Gerald King: I do not know that that very wise observation is an ai'gument in favour of prolonging or extending the time for inquiry in regard to this Bill. I think that the whole argument of the hon. gentleman, if you could call his remarks an argument, was one strong plea in favour of legislation being enacted as soon as possi-legislation being enacted as soon as possible rather than at a later stage of this


Edmund James Bristol: Has the minister not given this Bill his best and most careful consideration, and does he think it unreasonable that we should give it a few minutes' consideration?


George Gerald King: If the hon. gentleman will allow me to finish I think I will be able to make my position clear. The Bill has been before the House for nearly three months,

hon. members have had ample opportunity of studying it, and if they have not taken advantage of that opportunity they can hardly blame the government. However, I think it is perfectly reasonable to take the attitude which has been taken by some member's that certain clauses of this Bill should be discussed very carefully, and if thought desirable should be amended in certain particulars so as to make the meaning perfectly clear. It is not the desire of the government to put through a measure which is going to work an injury to any corporation whatever in this country that is carrying on a legitimate business, and if the Bill, as framed does that I, for one, am perfectly. agreeable to add to the Bill such features as may be necessary to safeguard the interests of corporations _ carrying on legitimate business in a legitimate way. But, I do not want to have the features omitted from this measure which will make it effective in dealing with corporations that are not conducting their business in the interests of the public. It seems to me that this purpose can be served by the committee passing such of the clauses as appear to be non-contentious. There are many of the clauses in regard to which, once the committee has considered them carefully, the committee will have an entirely different view. The fact that exception is taken to the definition of the word ' combine ' illustrates what I have in mind. The definition, I admit, is a very broad one, and if everything that comes within that definition were to be considered as illegal, I would be the first one to move to strike it out altogether. But that is not the intention of the measure. It is not the combination as such that is aimed at, but the fruits of the combine where those fruits are contrary to public interest. One might see a notice to the effect that persons belonging to a certain category were not to be admitted to a certain show ground or a horse-race, and he might think on reading the definition of ' persons ' that he was excluded until he found by reading the description further that it only applied to persons under sixteen years of age. It is the same with this measure. There may be a combine which is perfectly legitimate, and unless it can be shown before a judge of the high court that this combine is such as is enhancing prices unreasonably, but one stage of the proceeding would take place. The penalties do not become applicable at that stage. Further investigation takes place in which all the parties interested take part, and my hon friend from North Simoce (Mr. Currie) surely will not say that after a judge of the high court has passed upon a combine, and its business had been investigated by a board, and it has been found that a certain class of Mr. KING.
business has been carried on which is detrimental to the public, that such a combination should not come under the Criminal Code or should not be put in such a position as to render the nersons responsible for it liable if they persist in their manifest wrong doing. It seems to me that once you establish that, after careful and thorough examination, such as provisions; is made for by this measure, it is all important there should be other legislation such as at present exists for seeing that the conduct complained of is, effectively stopped. I would suggest that we should proceed in committee, and if there are any contentious clauses the proposed amendments to them can be considered, and no doubt we will be able to so arrange them as to make them generally acceptable to the House. There is no need for the House to take evidence at this stage. We have plenty of evidence in the report of the select committee of 1888, and what is now needed is a more effective means of ascertaining the exact situation in regard to the working of these combinations.
Mr.' LANCASTER. I would suggest to the Minister of Labour, that it is unbecoming on his part to lecture the opposition as to the wisdom or unwisdom of any course which in the public interest they deem it necessary to pursue. The hon. gentleman complained because we were not prepared to swallow his Bill holus-bolus on a minute's notice, and he told us we had plenty of time to consider it early in the session. The fact of the matter is that the very resolution on which his Bill is founded was only moved to-day and the hon. gentleman took three and a half hours in the busiest time of the session to explain this wrnnder-ful measure. And yet, he thinks it preposterous that we should want consideration in a committee to find out what all his talk was about. I trust that in future the Minister of Labour will not have the temerity to lecture this side of the House on the propriety of their conduct.
On section 4,


Richard Blain: I understood the minister to express himself that this measure must be forced through this House and become law this session. It is important now that the minister should state frankly whether he does propose to press this legislation to a finality this session, which it is expected will last only a few weeks longer.


George Gerald King: I am not aware that I used the expression that I desired to force any legislation through, and indeed I should very much regret if legislation of this importance were forced through the House. On the other hand, I helieve that the people of Canada are anxious to have legislation of this kind passed, and I can see no

reason why it should not be enacted at the present session. As we go through the different sections I think it will become apparent that our differences exist with respect to only two or three clauses of the Bill, and these slight differences can be reconciled in committee by conference. Possibly we have not very much time before prorogation, but I do not think this Bill will delay the business of the House, and if it can be put through this session I think it ought to be put through.
Mr. RHuDES. Why does the Minister of Labour object to this Bill being sent to a special committee?


George Gerald King: For the simple reason that I do not think any useful purpose would be served. On the other hand there is very serious objection in that such a reference would probably mean that the Bill would not'become law this session.


Mr. RHODES.: Why does the Minister of Labour think that no useful purpose would be served by sending the Bill to a committee?


George Gerald King: Because this Committee of the Whole have already in their possession the information necessary to enable us to proceed. A select committee of this House has already investigated combinations and trusts and its report is before us.


Richard Blain: How long ago?


George Gerald King: Twenty years ago. The fact that certain members of the House were not in parliament then does not preclude them from reading the evidence taken.


Edmund James Bristol: Does the minister think there have been no changes in business conditions during the last twenty years? On that point, there are many people who w7ould want evidence taken.


George Gerald King: Whatever change has taken place has been a change in the direction of emphasizing the necessity for such legislation as this. The boards of trade of Toronto and Montreal, the wholesale grocers, the retail grocers, the Manufacturers' Association, the Dominion Trades and Labour Congress, the Union of Canadian Municipalities, the Dominion Grange, the Victoria Board of Trade, leading manufacturers and business houses have all communicated with me in reference to certain sections of this Bill, and I shall be glad to bring their suggestions before the committee. In that way, the committee will be in possession of any facts that are necessary to a consideration of the Bill.


Thomas Simpson Sproule: And a number of the members have received suggestions from different interests, that this Bill should be sent to a committee where they may be heard.	I


Edgar Nelson Rhodes: At a former session of the House, the Minister of Finance enunciated the doctrine that the opposition in parliament had only such rights as the government of the day would agree to give them, and since then the eminent legal authority from Thunder Bay and Rainy River, who now sits in the seat of the Minister of Justice, stated the opposition had no rights whatever.


James Conmee: Oh, no.


Edgar Nelson Rhodes: And to-night we have the Minister of Labour enunciating the new doctrine that the opposition should be estopped from making any suggestions because notice has been on the order paper for a couple of months that certain legislation would be introduced. The hon. minister may be quite right in taking the position that because notice had been given of a Bill for a couple of months it would not be proper for the opposition or for any hon. member to ask for a select committee to consider it; but I would like to contrast the action of the hon. minister with respect to this Bill with his action respecting a measure brought to the attention of the House earlier in the session, namely, the Bill respecting the hours of labour on public works. In that case, we had a Bill which had been introduced into parliament year after year, and notwithstanding the fact that a Bill in identically the same terms was introduced into the House this year, and was pressed for consideration, the minister was pleased to say that it should be referred to a special committee, although there were volumes of information respecting the hours of labour on public works, not necessarily taken in this House, but taken before the Congress of the United States, and all sorts of information in the hands of the department which the hon. minister is supposed to conduct. But to-night, the opposition is to be stopped from suggesting that this measure should be referred to a select committee, because forsooth notice of it has appeared on the order paper for two months, and because 22 years ago there was an investigation into trade matters by a special committee of this House. I would like the hon. minister, if possible, to reconcile his position on these two Bills. *


George Gerald King: First of all, I cannot at all agree to the interpretation put upon my words. There is nothing in what I have said to indicate for a moment that I wish to deprive any member of the opposition of the opportunity of making any suggestions or criticisms that he may wish or proposing any amendment in Committee of the Whole. With respect to the special committee on the Eight-hours Bill, I would point out that that is a subject which has never been considered by a select committee of this House, while the subject of

this Bill was made a special Terence to a select committee, and we have the evidence in bound form taken before it. Then, this legislation is simply to amplify legislation already on the statute-book, which has been discussed in this House year after year-in 1888, 1897, 1904 and 1907. At these different times, enactments were passed in this House on the subject of trusts and combines. So that it is not a new question, and this measure does not seek to introduce any new principle of law or any departure of a startling nature, but is simply to amplify the machinery already on the statute-book. That is a vastly different thing from proposing an entirely new enactment. Moreover, this is a government measure.


Edgar Nelson Rhodes: If this subject can go without legislation for a period of 22 years, 1 cannot see the crying necessity for driving through a drastic measure near the dying hours of the session; because if this measure is to be effective it must be drastic in its provisions, and if it is not drastic, it is not worth being considered at all.


Glenlyon Campbell: I cannot understand for a moment the hon. minister not being willing to grant a special committee of inquiry. We had a special committee on the so-called Miller Bill, and the First Minister has practically admitted that it is to be dropped. We had another special committee on the Insurance Bill, and up to a few hours ago we understood that that was to be dropped this session. We also have the Banking Act, and that is to be dropped for this session. On this Bill, on which we have practically no information except the effusion of the minister himself and what was obtained 22 years ago, I think it is only right that we should have a special committee.


Mr. DOHERTY.: ^ I understood the minister to state that he had received petitions for this Bill from a number of the boards of trade, among others the Montreal Board of Trade. I would ask him if in some of those communications it was not specially requested that this legislation should not be proceeded with until the members of the boards of trade had an opportunity to study its terms and express their views upon it.


George Gerald King: These bodies have expressed their views, and it was my intention to bring them up in the discussion in committee.


Charles Joseph Doherty: What I would like to know is whether they did not request an opportunity of studying the measure and placing their view3 before the legislative body that was going to pass upon it. If they have expressed their views to the minister, this House ought I think to have the advantage of the expression of those views. I would not like to speak with any Mr. KING.
positiveness, but I have a recollection of having received a communication from the Montreal Board of Trade to the effect that this legislation was such that they thought that it should not be proceeded with untjl the boards of trade throughout the country had an opportunity to study it, and express their opinions upon it. A request coming from these bodies which have a special fitness for expressing an opinion on legislation of this kind, deserves the fullest consideration on the minister's part and on the part of this House. Before this House can give any consideration to the views of bodies so peculiarly fitted to speak upon the matter, it would seem that this House should have an opportunity through a committee or otherwise, of hearing the views of those boards. The hon. minister says this measure is not introducing any new principle. I do not want to go into any discussion on that point, but I think it may be certainly said that this government i3 providing a means of conducting proceedings of an absolutely inquisitorial character into the business of any man whatsoever with regard to which five or six people can be found to come forward and say that they believe that it is being carried on in a way to enhance prices, or to cause some detriment to the public. In providing for making possible such an inquisition into the business of people engaged in what, up to the present, has been considered perfectly legitimate commerce, it seems to me we are, if not introducing a new principle, a,t all events proposing to enact legislation which may entail very serious consequences oij, the business public of this country. Under those circumstances, some opportunity should be given to those who may be affected to be heard in such a manner that this House may be in a position to appreciate what they have to say.


George Gerald King: I rise primarily to mention that there is an understanding between my hon. colleague who is leading the House (Mr. Fielding) and the other side, that we adjourn shortly after eleven o'clock, and as that time is now approaching, I propose, after a few words of explanation, to move that the committee rise and report progress. After the statement of the hon. gentleman (Mr. Doherty) that the Board of Trade of Montreal had requested to be heard


Charles Joseph Doherty: I did not say that they had actually made the request.


George Gerald King: 
Mr. GERVAIS.: Before the motion is put, * I would like to ask the hon. Minister of < Labour if the legislation he proposes has ] not been inspired by German legislation relating to the ' Vereinen, Konventionen ' or J Syndicate.' I think we are trying to enact : in Canada only a piece, but not the most t important, of German legislation relating to the 'cartels' or the German commercial ententes or agreements; and in my opinion, i if we pass too hastily the legislation now proposed it will interfere very seriously both with the customs and financial departments of our country. This is a very important piece of legislation concerning which quite a number of facts must be shown, but which we have not yet heard mentioned in this debate, should be brought before the House. By this Bill my hon. friend is seeking to have applied to this country but one part of German legislation as I have said, relating to the German 'ententes' or commercial agreements, or the German combines which in a general way come under the name of ' cartels.' This Bill is aiming, as in Germany,' at the suppression of oppressive commercial combines, through the reduction of customs tariffs. There are a lot of things to be stated and arguments to be used for or against those ' Vereinen, Konventionen or Syndicate,' concerning which we should have some more information, at any rate, before this Bill is put through. According to my opinion, this Bill should not be railroaded, through this House.

Wednesday April 13, 1910.