1917-05-01

THE POTATO SUPPLY.

[Stage Direction]
On the Orders of the Dayr
['In the meantime, we\nhave the positive statement of hon. gentlemen opposite that it is an emergency measure, and we have the rather roundabout statement of the Solicitor General from which the only reasonable inference is that the Order in Council will be repealed when it is no longer required, and it will be no longer required if we have no low grade wheat this year. I hope we will have none, but I do not want to see this Order repealed.\nOn motion of Mr. Bou.lay, the debate was adjourned.\nOn the motion of Sir Thomas White, the House adjourned at 11.20 p.m.\nWednesday, May 2, 1917.']
Mr. A. B. McCOIG (West Kent):: As there is a very great shortage of potatoes at the present time in different parts of Ontario, both for food and seed purposes, 1 should be glad if one of the ministers, possibly the Minister of Agriculture, who stated some time ago that there was a large surplus of potatoes in different parts of Canada, would tell us where these surplus potatoes can be obtained.


Hon. MARTIN BURRELL (Minister of Agriculture):: The condition of the potato industry, very briefly, is this: When we heard of reported shortages and a scarcity in some parts of the country, I communi-oalted wlith every provincial Minister of Agriculture in Canada to ascertain as closely as he could the conditions in his own province; this was at the end of February. As nearly as we could ascertain, a conservative estimate put it at about one and a half million bushels surplus over and above the food and seed requirements of the whole country. The surpluses were chiefly in the provinces of Alberta, Prince Edward Island and New Brunswick. In some other provinces shortages were reported, and other provinces were not quite sure. We checked up the figures at the end of March by .following all the exports from the country, and again up to the 15th of April, and from the time we estimated the amount of potatoes in the country up to the 15th April about half a million bushels were exported, leaving-if our estimate was at all correct, and it was based on the information I have indicated-about one million bushels surplus still in this country. Of course that may be only approximate. I might also say to my hon. friend that a summary of all the replies I received was sent to each Minister of Agriculture in the different provinces, in order that he might know the exact condition throughout the country, together with ithe suggestion that it might be advisable for those ministers whose provinces were likely to be short, to watch the situation as closely as possible with the idea of doing what they could to supply the needs of their own province.



Mr. S. F. GLASS (East Middlesex):: At a meeting of the Ottawa Greater Production Committee yesterday, the following resolution was passed:
In view of the urgent and pressing need for the production of the largest possible quantity of foods, and hy reason of the uncertainty of weather conditions permitting work to be done on land when in a suitable condition for planting and sowing, this committee recommends to the Organization of Resources Committee for Ontario that it petition the Dominion Government to take action under the War Measures Act to suspend the Lord's Day Observance Act as it applies to farm labour for seeding and harvesting; work.
I should like to ask if the Government have received representations from any other source as to the desirability of suspending the Lord's- Day Act in accordance with this suggestion.


Sir THOMAS WHITE:: Not to my
knowledge. No similar representation has been made. I saw the report in question in this morning's paper, hut the matter has not been brought to our attention in any other way.


STATE OF RECRUITING.
[Stage Direction]
On the Orders of the Day:
Mr. E. M. MACDONALD:: I desire to
call the attention of the leader of the House (Sir Thomas White) to a statement made by the hon. member for Victoria, Ontario, (Sir Sam Hughes). Speaking in Lindsay on Saturday he said:
More than one year ago an agitation was begun on the question of labour. We were recruiting too many regiments; we were 'taking too many men away from work'; 'munitions manufacturers and others would he at a standstill' ; 'farmers could not put in their crops'; and 'Canada has already done her full duty' were daily recited. They, unfortunately, had an . effect upon the Prime Minister. The result was that 1 was asked in March, 1916, not to press recruiting, and recruiting to-day is and has been dead in Canada for fighting purposes.
Will the hon. gentleman say whether that statement is correct or not?


William Thomas White: I would suggest that my hen. friend address that question to the Prime Minister (Sir Robert Borden). So far as I know the statement referred to has no foundation.


THE BUDGET.
[Stage Direction]
The consideration of the proposed motion of Hon. Sir Thomas White (Minister of

Finance) for the Committee of Ways and Means, and the amendment of Mr. Turriff thereto, was resumed from Friday, April 27.
Hon.   S@: By Order in Council, under authority of the War Measures Act, the Government, on 16th April, placed upon the free list three commodities, wheat, wheat flour and semolina, and by that action brought into operation the provision of the Underwood Tariff under which wheat and wheat products from the coun-' try taking such action become entitled to free entry to the markets of the United States. The matter was not referred to in the Budget but my hon. friend from Assiniboia (Mr. Turriff) has moved an amendment, and it is to that amendment and to the subject of free wheat that I purpose for a short time to give consideration. It seems to me that the position taken by hon. gentlemen opposite with reference to this action of the Government in placing wheat, wheat flour and semolina on the free list is a most extraordinary one. These hon. gentlemen have asserted for the last three years-the Underwood Tariff having come into effect in October, 1913-that they were in favour of free wheat. One would have thought that when the Government took the action which has been taken these hon. gentlemen would rejoice. One would have thought that the hon. member for Assiniboia, and the hon. member for St. John (Mr. Pugsley) when speaking on the question, would at least have looked pleased. The impression goes out from the House that hon. gentlemen opposite who have spoken on this question are glad that the Government has taken this action, but to us in the House they do not look glad, they appear to be sorry. I wonder if the real explanation is not that these hon. gentlemen prefer to have the cry rather than the wool, that they would rather have free wheat ,as a political issue rather than free wheat as an actuality. At all events, that seems like a reasonable explanation of their attitude on the action of the Government in placing these three commodities on the free list and calling into operation the provision in the Underwood Tariff that I have mentioned.
The criticism of the Opposition upon the action of the Government in this regard proceeds upon several grounds. First, they say it was a departure from the fiscal policy of the Government and of the Conservative
party. Second, they say: You have granted it now; why did you not grant it before the war? Third, they say: You grant it now during the war, why did you not grant it earlier in the war? Fourth, they say: The measure is temporary, and with the end of the war the duties are automatically restored. And fifth, they have the temerity to say that the Government was actuated by political consideration in view of an approaching election. I am sure my ears did not fail me and that I distinctly heard my hon. friend from Assiniboia make that last statement.


Mr. TURRIFF:: You are quite right.


William Thomas White: My hon. friend
admits it. Now let me say-because I desire to discuss this matter seriously and earnestly-that we on this side, ever since the Underwood Tariff came into effect in 1913, have viewed this matter of free wheat upon what we regarded as its merits; we have never declined to grant free wheat on the ground that it involved a departure from the traditional fiscal policy of the Conservative party. I proceed now to prove that what I state is correct. In the Budget speech of 1914, which was the first occasion upon which I discussed the Underwood Tariff in the House of Commons, I set forth the arguments pro and con on the subject of free wheat; I set them out fully, I set them out, I submit, judicially; I did not take the ground that the Government would have nothing to do with this because it was a violation of the fiscal policy of the Conservative party. I examined the whole question from a business, economic, and public standpoint. I said:
So much for these opposing arguments and contentions. Speaking generally, it is not advisable that a nation's tariff should be so arranged as to fit into the particular features of that of another nation. This, however, would not be a conclusive reason for not making a change clearly in the national interest.
At that time we came to the conclusion, having regard to the fluctuations of price between Winnipeg, Minneapolis and Chicago, that there was not the advantage to the farmer that was claimed in this matter of free wheat* and, having regard to other considerations-industries in Canada of an important character and the condition of our railways-we thought it was not advisable at that time to grant free wheat. But we did not argue it upon the ground that it would be a departure from the fiscal policy of the Conservative party. On tlie contrary, we said by implication that if it

were in the national interest we were prepared to consider it. I desire to make that perfectly clear. Let us see what I said when this matter was before the House in February, 1916. I spoke on a resolution moved by the hon. member (Mr. Turriff), who now brings forward this amendment. 1 had been giving the matter my most painstaking attention during the whole of the year. If the Government held the view at that time that it was a departure from the fiscal policy to consider this question, what would be the reason for my giving consideration to the matter in my office continuously as I did? This is what I said, as reported in Hansard on page 861, February 16, 1916:-
I have caused a record to he kept of prices of grain both in Canada and in the United States, with a view to thoroughly familiarizing myself with the merits of the question in order to reach a sound and just conclusion in the national interest. When I say in the national interest, I need not say how important a factor in the national interest I consider the interest and material well-being of the three great grain-growing provinces of the West. It is in that spirit that I have approached, from time to time, the consideration of this question.
And I expressed the opinion on that occasion, in February, 1916. that it was unwise in the national interest that free wheat should be granted. It was not clear to me that the advantages that would be gained would outweigh the disadvantages, but I repeat, and the point I am making is that we always considered the question upon its merits and had regard, in dealing with it, only to what we regarded as the national interest. The position of the Government, in its view upon the question of free wheat in 1914, in 1916, and in April of this year, when we took action, has been absolutely sound and consistent throughout. I make that statement without the slightest hesitation ; I say our action has been sound and consistent throughout. How can it be urged that it was a violation of Conservative fiscal policy? Sir John A. Macdonald was a fairly good Conservative; so I have heard. Sir Leonard Tilley was the finance minister of Sir John A. Macdonald. Sir Leonard Tilley introduced the National Policy budget about 1879. The National Policy budget of 1879 has 'been the charter of the fiscal policy of the Conservative party from that day to this. Let us see what Sir Leonard Tilley said in regard to reciprocal provisions in the tariff. Sir Leonard Tilley, in 1879, in introducing the National Policy budget, said:-
The Government, requiring more revenue, have determined to ask this House to impose
[Sir Thomas White.!
upon the products of the United States that have been free, such a duty as may seem consistent with our position. But the Government couple with the proposal, in order to show that we approach this question with no unfriendly spirit, a resolution that will be laid on the table containing a proposition to this effect: That, as to articles named, which are the natural products of the country, including lumber, if the United States take off the duties in part or in whole, we are prepared to meet them with equal concessions. The Government believe in a reciprocity tariff, yet may discuss Free Trade or Protection, but the question of to-day is-Shall we have a reciprocity tariff, or a one-sided tariff?	[DOT]
That was the National Policy budget of Sir Leonard Tilley in 1879. Is it contrary to the fiscal policy of the Conservative party either to have a reciprocity provision in the tariff which remains under you control absolutely or to take advantage of a reciprocal provision in the tariff of another country? I submit that the action of Sir Leonard Tilley in 1879 is absolutely conclusive evidence that the attitude we have taken is in no way inconsistent with the fiscal policy of the Conservative party.


Sir WILFRID LAURIER:: No; it was the election that you were thinking of.


William Thomas White: I have a great
personal regard for my right hon. friend. He weathered the storm for many years and he was always on firm ground when he followed the policy of Sir Leonard Tilley. My right hon. friend notwithstanding his free trade professions in 1893, when he got into office followed in the footsteps of Sir John Macdonald and Sir Leonard Tilley and while he continued in that path he got on well in regard to his fiscal policy. But, my right hon. friend instead of continuing to follow the true lights was allured by a will-of-the-wisp and that brings me to the reciprocity agreement of 1911. My right hon. friend I think, would admit, if he would tell us his opinion candidly, that he then made a political mistake of the first magnitude


Wilfrid Laurier: He did nothing of the kind. The policy of Sir Leonard Tilley in 1879 was that reciprocity of tariff would conduce to reciprocity of trade.


William Thomas White: I am sorry that my right hon. friend has not got over 1911. He tried upon that occasion to prove the impossible. He tried to prove that under reciprocity the farmer would get more for his product but that the consumer would pay less. We all kn.ow that when my right hon friend attempted to prove that to the people of Canada he was fore-doomed to

failure. Not even my right hon. friend could do that. He could not pr.ove the impossible. My right hon. friend in connection with the reciprocity agreement, was like a mariner who disregarded the beacon lights. He disregarded the beacon light that was hung up by one of the greatest Liberals of the day, Hon. George Brown. When the Hon. George Brown was a member of the coalition government formed to bring about Confederation, he went to Washington in connection with the matter of reciprocity and he absolutely declined to become a party to an agreement such as was entered into by my right hon. friend's Government with the Government at Washington. Hon. George Brown stated that every tariff agitation over there would find its echo at Ottawa and 'he actually resigned from the coalition Government upon that ground. You will find authority for that in the letters and memoirs of the Hon. George Brown.
There were many objections to the reciprocity agreement as has been shown by our experience in 1911. Quite a number of articles, which, under the agreement would nave entered the United States, subject to duty, enter the United States to-day free. I repeat there were many objections to the reciprocity agreement. The chief objection was the fact of the agreement. It is true that on its face it was stated that it was not a treaty, but in substance and in fact it was a treaty and when it was entered into the late Government lost to a considerable degree the control of its own tariff. That was the feature of the reciprocity agreement, to which chief objection was taken. There were many other objections but that was one of the chief ones, and it was, that when that agreement was entered into the Government of Canada lost in a measure the control .of its own tariff. Under the National Policy Budget of 1879, Sir Leonard Tilley did not lose control of his tariff for a moment, and in the action which we have taken under the authority of the War Measures Act, we have not for one moment lost control of our tariff.
Our action was not preceded by any negotiations There was no agreement with the United States. We took action under the War Measures Act, and we placed wheat and wheat flour and semolina on the free list. The tariff is just as much under the control of this Parliament as it was on April fifteenth. There is a clear distinction between taking advantage of reciprocal provisions in the tariff of another country or
offering advantages by reciprocal provision in your own tariff, control of which you do not lose for a moment, and negotiating an agreement under which you lose such control. That is a clear distinction that any one can make.


John Gillanders Turriff: If, under the agreement of 1911, Canada would have lost control of her tariff, would the United States have lost control of its tariff under that agreement?


William Thomas White: It would to a certain extent, but not to the extent that Canada would. The United States was a very much larger country than Canada and there would not be the same considerations weighing with the Government of the United States contemplating the recision of agreement that there would have been upon the Government of Canada considering recision.
My right hon. friend (Sir Wilfrid Laurier) should have made a fresh start after 1911; he should have Said: I have made a mistake with regard to reciprocity, and I am going to make a new start. I often think that my right hon. friend was more partial to the reciprocity agreement than to any other child of his political brain. One reason was that it was the youngest. Reciprocity was my right hon. friend's youngest political child, and we must not blame him from being partial to it, because it was his Benjamin. I mention that because, like parents whose children who have been lost, my right hon. friend sees resemblances to reciprocity in many measures brought forward in this House. For example, if I borrow in New York my right hon. friend says: Oh, that is reciprocity.


Wilfrid Laurier: No, that is truck and trade with the Yankees.


William Thomas White: My right hon. friend says that is truck and trade with the Yankees and he has said in this House that it was. But it is not his long lost child, reciprocity; it is a very much more healthy and robust infant; it is legitimate business, borrowing in the United States, just as I might borrow in Great Britain. We sell our securities to the United States just as for generations past we have sold goods to the United States. But my right hon. friend sees in it a far away resemblance to reciprocity.
Then when we, under the War Measures Act, take the action which we have taken and bring into operation the reciprocal provision in the Underwood Tariff of 1913, my

right hon. friend again says: Reciprocity! But it is still a case of mistaken identity. This is a very much more self-respecting child than reciprocity or the reciprocity agreement of 1911 because, as I have pointed out, in this action that we have taken we have not lost for one moment control of our tariff. The fundamental and essential difference between our action respecting free wheat and the reciprocity agreement is that we retain in its fulness and entirety our control over our own tariff. We have not in the slightest degree abridged our freedom of fiscal action or surrendered one jot or tittle of our fiscal independence.


Edward Mortimer Macdonald: Does the hon. gentleman mean by that that the Government can at any moment repeal this provision in regard to free wheat?


William Thomas White: I shall later on deal very fully with that criticism, which was made by my hon. friend from St. John (Mr. Pugsley).
The second criticism that is offered is this: Why do you do this now and not be-before the war? I answer: because conditions have been profoundly changed by the war. Conditions affecting trade, international conditions affecting ocean transport have been radically and profoundly changed. There has been a revolution in trade and in transportation methods and conditions since the outbreak of this-war. Let us take our condition three years ago, before war broke out. We exported largely to Great Britain. We borrowed largely in Great Britain, that is to say, we exported our securities and sold them there. We were obligated to pay in Great Britain interest upon huge sums which we had borrowed for the development of this country. We imported to a considerable extent from Great Britain. WTe imported to a large extent from the United States. Our imports from the United States greatly exceeded our exports to the United States. We were, I think, the second best customer of the United States. How did we pay the United States for the balance of trade? We paid the United States for the balance of trade through Great Britain. Great Britain exported to the LTnited States, and those exports would be a set off to her imports from the United States. But in addition to that the United States owed Great Britain vast sums for interest upon securities. In addition to that Great Britain, by the services of her carrying fleet, established a large indebted-
ness on the part of the United States. The result was, as I have stated, that it was England that paid the United States the balance that we owed the United States upon international trading. Now let us see what has happened since the war has broken out. Our imports from the United States have immensely increased.


Wilfrid Laurier: Hear, hear!


William Thomas White: My right hon. friend says "hear, hear."


Wilfrid Laurier: Certainly.


William Thomas White: Yes, our imports from the United States have immensely increased. How can we liquidate that^ adverse balance to-day with existing conditions of transportation and exchange between England and the United States unless we increase the sale of our products to the United States?


Wilfrid Laurier: Hear, hear, by all means.


William Thomas White: At last my right hon. friend and I are together in agreement.


Wilfrid Laurier: That is what reciprocity would have done.


William Thomas White: But reciprocity was a peace time measure.


Wilfrid Laurier: Oh, oh.


William Thomas White: I am speaking about war conditions, and they have brought this about.


Wilfrid Laurier: You seem very much involved.


William Thomas White: Let us see what the conditions were in 1911, or even in 1914. My right hon. friend need not take my opinion or my statements; I shall cite to him one whose authority not even my right hon. friend will question. But let us see, just for a moment, the change that has taken place in the exchange of commodities between Gfeat Britain and the United States since the outbreak of this war. In 1914 the exports from the United States to Great Britain were $594,000,000, let us say $600,000,000, merchandise only, and in 1916, last year, those exports had risen to $1,500,000,000 from the United States to the United Kingdom, or an increase of $900,000,000 in favour of the United States as compared with pre-war exports.
At the same time, the exports of Great Britain to the United States had increased only from $293,000,000 to $308,000,000. This means that exchange has

completely broken down between the United Kingdom and the United States; that the conditions which prevailed before the war do not prevail to-day; that an entire change has taken place both as to the channels of trade and the conditions under which trade is carried on.
I told my bon. friend that I would quote an authority to which he would defer. At the Guildhall a few days ago, Mr. Lloyd George, Prime Minister of Great Britain, referring to the transportation situation and the food conditions in Great Britain, made a most important statement Speaking about the shortage of ocean transport and its effect in Great Britain, he said that arrangements were being made whereby imports would be cut down by over 10.000,000 tons yearly without interfering with any essential industry in Great Britain. Why is the Government of the United Kingdom devoting its energies to cutting down imports? Because of the shortage in tonnage brought about by submarine warfare. Sir Edward Carson said yesterday that the losses from submarines were growing. There is no use minimizing or blinking matters; the submarine menace is a terrible one. During the week before last 40 large British and a'jlied vessels and 15 smaller ones were sunk, to say nothing of neutral shipping. That is the condition with which we are confronted to-day: the submarine menace to British and neutral shipping; regulations as to food enforced in the United Kingdom. Mr. Lloyd George further said: " We are placing under Cultivation 3,000,000 fresh acres of land so that in 1918 we shall be able to support ourselves within the confines of the United Kingdom." Will that have any effect upon trade or upon imports of foodstuffs? This war has brought about a limitation of ordinary imports into Great Britain, and of exports from Great Britain. Every day of my life I am asked by some interest in Canada to see if I can get the embargo lifted whereby exports from Great Britain of commodities in which they are interested are prohibited from leaving the ports of the United Kingdom-the reason being, of course, the shortage of shipping.
Coming to the wheat question, wlhat does Lloyd George say? I direct the attention of my right hon. friend and of the member for Assiniboia to the following words:
There are 85,000,000 bushels of wheat in Canada-
That is an under-statement.
-I would not say for the asking, but for the fetching;. It ought to have been here. I believe that about twenty or thirty million bushels
of this wheat had to go to the United States for lack of another market. We must cut down our food until we discover a method of destroying this ocean bacillus. That is one thing that has got to be done.
The British Prime Minister then says that there is plenty of wheat in Canada, not for the asking, but for the fetching. He says:	It is impossible to fetch it on
account of the submarine mepace and of the shortage of shipping; consequently it has to find <a market in the United States. This indicates that formerly the wheat had
found a market in the United Kingdom,	
and that normally it would find its market there to-day if the British authorities had the shipping to fetch - it.
So far as conditions affecting the sale of Canadian wheat were formerly concerned, there was a good export demand from millers and others in the United Kingdom for all grades of our wheat. There was a better demand for the high grades, but there was, nevertheless, a demand for the lower grades. While there is still a certain demand locally and by millers for the low grades of Canadian wheat in our West, it is a fact that the export demand for low grade wheat has diminished-this is precisely what you would expect-because of the food regulations in the United Kingdom and the shortage of cargo space. They adopted regulations in the United Kingdom with a view to gerting the greatest amount of food product out of a given amount of grain. For a considerable part of the last few months Stoddart & Company, who have been purchasers for Great Britain of wheat in Canada, have been purchasing the higher grades of wheat-only recently have they been purchasing any of the lower grades-and the result was that while there was a good market for the higher grades of wheat, there was not as good a market for the lower grades. The hon. member for Assiniboia knows that.
In addition, it is perfectly clear to me that advantage was being taken of the situation with regard to the lower grades of wheat and that the farmer was not receiving for the lower grades of wheat the money that he should have received. That was the position with which the Government was confronted. If anybody is disposed to challenge that, let him examine the figures for March, which show in most illuminating fashion what has happened with regard to the channels of trade. In the month of March, 1916, 400,000 bushels of wheat only went from Canada to the United States, and in the same month of this year 2,400,000

bushels of wheat went into the United States-six times as much, an excess of 2,000,000 bushels. This occurred, as I have stated, because the exchange situation and the shortage of ocean transportation has given Canadian wheat and other products a tendency to move towards the United States.


Mr. ROBB:: Who paid the duty on that wheat going into the United States?


William Thomas White: It would have to be paid in every case, but there might be a drawback with respect to a good deal of it. I am unable to say how much, and 1 am sure that my hon. friend is unable to say how much. The fact remains, how ever-and it is a most illuminating fact- tint the increased amount of wheat going into the United States in the month of March of this year was as I have stated.
The hon. member for Assiniboia then makes his third criticism of the action of the Government. He says: "Why was not free wheat granted early in the war? If you did this owing to war conditions, why did you not do it in 1914?" But even the hon. member for Assiniboia would not have had the temerity to ask the Government in 1914-15 to grant free wheat, because the market at Winnipeg was so very much higher than the market at Minneapolis or Chicago. There was no resolution with regard to free wheat in 1914-15, immediately after the outbreak of war.


John Gillanders Turriff: We advocated it every year.


William Thomas White: My hon. friend could not have advocated it in 1915, because, as a matter of fact, for many months in the fall of 1914 the market at Winnipeg was much higher than the market at Minneapolis or Chicago.


John Gillanders Turriff: No.


William Thomas White: My hon. friend shakes his head-but there is no doubt about it-that the market at Winnipeg was better, and there are reasons for that.


John Gillanders Turriff: Is my hon. friend not contrasting, say, No. 2 Northern Manitoba grade with No. 2 Northern Minneapolis grade?


William Thomas White: No, I am familiar with all those distinctions..


John Gillanders Turriff: That is what my hon. friend has done.


William Thomas White: I make the statement that after the outbreak of the war the Winnipeg market was better than either the Minneapolis market or the Chicago market.


John Gillanders Turriff: That is not the case.


William Thomas White: There were reasons for that. The exchange, instead of being favourable to the United States, as it is to-day, was unfavourable to the United States. That is sufficient answer to my hon. friend, who says: Well, if it is proper to do it in war time, why did you not do it earlier in the war? The reason was that conditions earlier in the war were such that the exchange was unfavourable to the United States.
We come down now to last year. It was uncertain, during last year, as to what the position was. Sometimes the price at Winnipeg would be a little higher than the price at Minneapolis; sometimes the price would be a little higher at Minneapolis than at Winnipeg. The statement was made here that on the lower grades of wheat there was a considerable spread. There was likely to be a greater spread on the lower grades at that time than on the higher grades, but that argument was put forward last year. There are, however, two considerations to be borne in mind. In the first place, the submarine menace had not yet developed on the scale that it is at the present time. It is a well known iact that during the early part of 1916 it was believed that the submarine menace had been mastered. I am speaking now of the small submarine. What has transpired since that is this: There has appeared upon the scene for many months the super-submarine with an enlarged area of operation, and it i3 the super-submarine and the multiplication of submarines toy Germany devoting the energies of her shipbuilding plants to the building of submarines that has brought about this acute situation. But it took a long time to develop; it was only on February 1 of this year that Germany declared a blockade of the British Isles and announced to the entire world that she would sink the shipping, not only of Great Britain but of neutrals. Up to that point she was sinking the shipping of Great Britain; she had not dared to sink the shipping, at all events, of that great neutral, the United States; but since February 1, she has been sinking, not only British shipping, but neutral shipping, and she has in that way profoundly affected the carrying capacity of the Atlantic fleets, although last year it was not apparent that the situation, which has since developed,

would develop. But there is another very important situation. The United States at that time was not an ally. It 4 p.m. might have been possible that Great Britain would require the entire wheat crop of Canada. What is the position to-day? The United States has taken her place with the Allies in this great war. The wheat and other food products of the United States and of Canada are practically pooled to-day for the use of the Allies. The British buyers, buying for Great Britain and for her Allies, are purchasing the exportable wheat crop of the United States and of Canada.


John Gillanders Turriff: Is that the reason why my hon. friend has put wheat on the free list?


William Thomas White: I am developing this argument beautifully.


John Gillanders Turriff: Yes.


William Thomas White: My hon. friend cannot fail to understand. He who runs may read. I am giving my reasons why we did not do last year what we did in April this year.


John Gillanders Turriff: There is one you have not yet given.


William Thomas White: And if my hon. friend's mind were open for a moment, he would understand and agree that the course which we have pursued has been, not only consistent, but beneficial.


Wilfrid Laurier: Giving many reasons and fishing for a good one.


Mr. LEMIEUX:: Those reasons do not tally with those given by the Solicitor General.


Sit THOMAS WHITE:: Our reasons
usually tally. The Solicitor General is usually correct in the facts, and I try also to be correct. I was amazed the other night to hear my hon. friend from St. John (Mr. Pugsley) actually jeer-not so much in express words, but by his manner-at the high prices which the farmers of the West are receiving for wheat. I would have thought, if my hon. friend rejoiced, as he stated that he rejoiced, at the placing of wheat, wheat flour and semolina upon the free list, thus giving access to the United States for our wheat and wheat products, he would at least look pleasant; but he did not; he was rather annoyed.


Edward Mortimer Macdonald: He always looks
pleasant.


William Thomas White: 
John Gillanders Turriff: He is pretty good looking.


William Thomas White: then all I have to say is that I should not like to see him when he is looking unpleasant.


Mr. PUGSLEY:: The sadness of the Government's supporters would make anybody feel sad.


William Thomas White: My hon. friend looked pleasant in just the same sense that a man having his photograph taken looks pleasant-my hon. friend knows what I mean by that. He had very little sympathy for the high prices the farmers in the West were getting for their wheat. We often hear statements made as to the energy which Governments should devote in order to bring immigrants into this country, and I agree with all that has been said as to the desirability of the greatest possible activity being shown in bringing immigrants into this country; but the best immigration agent for Canada is a good price for wheat.


William Pugsley: The situation was the same last year as it is this year. Is that a new idea?


William Thomas White: My hon. friend the other night from his seat in the House rather jeered at the high prices which the farmers of the West were receiving for their wheat-


William Pugsley: Mr. Deputy Speaker, I leave it to you, Sir; you were in the Chair.


William Thomas White: Perhaps I had better put it this way: I will not say that my hon. friend jeered at the high price of wheat; I will say that my hon. friend apparently had no sympathy with the high price which the farmer was obtaining for his wheat. The agricultural community is entitled to every possible consideration. Agriculture is the very base of our industrial fabric; the farmers are the real pro-

ducers; the pyramid rests squarely upon the base of agricultural production.' There is nothing too good for the farmers because they earn all they get ; they are not in any combines. I was raised on a farm; I know what it is to get up at five o'clock in the morning, and I know how the farmer earns his money. I know what he gets, he earns by hard work.


Mr. GRAHAM:: Some times he earns
what he does not get.


William Thomas White: It is a good thing then that the farmer is getting a good price for his product. I do not know of anything that will relieve the high cost of living later more than the fact that there is a good price for agricultural products. What stimulates production is a good return for the effort expended and the capital invested; and that principle applies to agriculture as it does to any other business. I have no sympathy with stock exploitation, with stock gamblers or wheat gamblers, but I have great sympathy .with the farmer getting a proper price for his product.


William Pugsley: Would my ton. friend be good enough to elaborate that idea and show how high prices for agricultural products will reduce the cost of living.	.


William Thomas White: My hon. friend tried and failed in 1911 to establish that very thesis.


William Pugsley: And the Minister of Finance argued the other way then.


William Thomas White: My hon. friend was out ot the House when I pointed out that among other reasons why my right hon. friend (Sir Wilfrid Laurier) signally failed in 1911, was that he attempted to prove to the intelligent people of this country that the farmer would get more for his product and the consumer would pay less. My hon. friend would hardly expect me to embark upon that undertaking after the example of 1911.
Another argument of my hon. friend was: Why should we do this at this time with the price of low grade wheat at a dollar or $1.30, as the case may be, as it only means ten cents a bushel to the farmer? Well, ten cents on fifty million bushels means $5,000,000, and on twenty-five million bushe'ls, $2,500,000. Does my hon. friend mean to say that if this is a proper course for us to take in the national interest at this time of war conditions, the farmer in the West is not entitled to that ten cents? That was practically the argument of my

hon. friend the other night, and I was surprised at him making it.
To come to another matter. It was argued in 1914 and in 1916 that the milling industry might be injuriously affected by such a measure as this. Now, there are few industries in Canada that have had greater profits since the outbreak of the war than the milling industry; enormous profits have been made by the large milling companies. It has been suggested on the other side of the House, what about railways, what about the transportation situation? . Well, the war has materially changed that also. The war has changed the entire situation in Canada. What is the situation so far as the railways are concerned? My hon. friend from Assiniboia (Mr. Turriff) knows that wheat is not being taken out of the West to-day as it should be.


John Gillanders Turriff: Why?


William Thomas White: Because of the
shortage of rolling stock.


John Gillanders Turriff: No.


William Thomas White: Because of the shortage of rolling stock and motive power.


John Gillanders Turriff: A farmer in the West told me within the last six weeks that he sold 50,000 bushels of wheat. He went down to New York and made arrangements for shipping it across the ocean, and he said that there were hundreds and hundreds of cars standing on every siding in his part of the country, and the railroads would not take them away.


William Thomas White: Because of the shortage of motive power and the blocking of the eastern lines and terminals. If my hon. friend desires information on that point, let him do what I did. I am not talking at random; I consulted the Chairman of the Railway Commission, and I know what the railway situation is in this country. Does my hon. friend mean to say that wheat is coming out of the Goose I.ake District to-day, and that there are not millions of bushels in the hands of the farmer that cannot be moved by reason of the blockade on our railways and the shortage of rolling stock? Let my hon. friend ask the Chairman of the Railway Commission what is the greatest need of railways to-day, and he will be told rolling stock.


John Gillanders Turriff: No.


William Thomas White: I ask my hon.
friend to go and see him.


John Gillanders Turriff: I can only tell my hon. friend that if he travels along the roads in the west he will find hundreds and thousands of cars standing idle on the tracks. It is not a shortage of rolling stock.


William Thomas White: What is my
argument? I am showing that the railway situation has materially changed since the *war.	.


William Pugsley: The trouble is the want of elevators at the Atlantic terminals. The St. John elevators were burnt three years ago, and have not been rebuilt yet.


William Thomas White: So on all grounds the action of the Government was the right and proper course to take, having regard to the conditions which existed at that time. My hon. friend has a further, criticism. He says: Why did you act under the War Measures Act? Why didn't you come down to Parliament and make these changes in your Budget? I think this Budget debate itself is a sufficient answer to that. How long will it be before this debate will close and before the measures which are now before the House will be enacted into law by this House and by the Senate? How long does it take to have Budiget proposals translated into legislation? They go into effect immediately, so far as the Customs Department is concerned, but as a matter of fact they do not become law until the legislation is passed by this House and by the Senate and the Governor General has given his consent.


George Perry Graham: They go into practical
effect when the Budget speech is made.


William Thomas White: They go into
practical effect, but they would not meet the conditions of the tariff of another country. Hon. gentlemen say that we should not have taken this step under the War Measures Act. They say we should have included this free wheat measure in the Budget, and debated it for a month or six weeks, and two months from now the proposals would be enacted into law. Supposing we had done that? It would mean that the farmer of the West would have been deprived all that time of ten cents a bushel in respect of the low grade wheat he exported to the United States. I believe myself that in a clear ease, where you are certain as to the propriety of what you are doing, what is called fer is action, if you have the power to take that action. My hon. friend's criticism that this action should lhave not have been taken under the 60
War Measures Act is one that I am sure will not appeal to the people of the West. What the people of the West want in this particular situation is a market for their low grade wheat.


John Gillanders Turriff: A permanent market.


William Thomas White: 
George Perry Graham: That is not an absolute qualification.


William Thomas White: They both put forward the argument, "Under the War Measures Act you have taken off the duties, but those duties are merely suspended, and as soon as the war is over they will jump back again."


William Pugsley: Hear, hear.


William Thomas White: That is also what my hon. friend from St. John says.


William Pugsley: That is what the law says.


William Thomas White: But that is not what the Department of Justice says, and the Department of Justice is right. There has been presented to this House the opinion of the Deputy Minister of Justice, a man who has absolutely no political reason for misstating the law or the facts, or for



coming to any particular conclusion as opposed to any other conclusion. He is there to advise Liberal Governments and Conservative Governments alike. He is a good counsel, a sound lawyer. And what does he say? He says, as any lawyer who looks at it from a legal standpoint would he bound to say: you have taken the duties off wheat, wheat flour and semolina, and those duties are permanently taken off until fresh duties are imposed by or under the authority of Parliament. That is what he advises the Government, and that is what the Government believes has been done.


Edward Mortimer Macdonald: Will the hon. minister undertake to say that the Deputy Minister of Justice expresses the opinion that the Government could not, by Order in Council, during the pendency of the war, transfer these articles hack to where they were before?


William Thomas White: No, I do not.
Mr. 'PUGSLEY: How, then, does it become permanent?


William Thomas White: I will explain in a moment. Wheat, wheat flour and semolina are upon the free list in precisely the same sense as any other article is on the free list under the tariff to-day. Any article can be changed from the free list to the dutiable list toy or under the authority of Parliament.


William Pugsley: Does the hon. minister mean to say that any article can be changed from the free list to the dutiable list by Order in Council?


William Thomas White: If my hon. friend asks me that question, which embraces this particular case, I express my opinion that it can. But I will say this, speaking now on behalf of the Government, that the Government regard wheat, wheat flour and semolina as upon the free list in the same way that any other articles on the tariff are on the free list, and that fresh duties will not toe imposed except by Parliament. Why do I eliminate " or under the authority of Parliament?" For this reason: Under the general legislation, apart altogether from the War Measures Act-


Edward Mortimer Macdonald: Why did not the hon. gentleman submit the proposition to Parliament?


William Thomas White: I have covered
that ground so fully that I thought even a child could understand it. The hon. member (Mr. Macdonald) must have been 
asleep, or else he was talking to the hon. member for Bonaventure (Mr. Marcil) who is a charming companion. But I make the statement that the Government understands what has been done in the same sense that its legal adviser understands it, and I say that if these duties are ever reimposed it will toe by Parliament. Why do I say that? Under the general legislation the Governor in Council at any time can place upon the free list any article or commodity that is used in connection with Canadian manufactures. Further than that, the Government can at any time grant remission of the duty under the Audit Act in cases where duty has been paid on articles imported. It is not an unusual thing for a government to reduce a duty, or even to place an article upon the free list. It is not altogether unusual-though power in this respect is more seldom exercised for the Government to grant remission ;of duty on articles that have 'been imported. The right hon. leader of the Opposition (Sir Wilfrid Laurier), when, in power, remitted the duty on coal; and we remitted the duty on cement on one occasion, 'because there was a scarcity of cement in the West. It is not an unusual thing, I say, for the Governor in Council to reduce or remove duties. But it is an unprecedented thing, so far as I know to impose duties by Order in Council; and I have no hesitation in saying that this Government, or any Government that succeeds it, if it desires to impose fresh duties upon these articles, will bring the proposal down to Parliament and have it enacted into law in the usual way. So we need not worry ourselves about these legal disquisitions and arguments about the validity of the Government's action under the War Measures Act-that argument entirely disappears.	-	[DOT]
Let me summarize what I have said: In the first place, there has been no departure from the traditional fiscal policy of the Conservative party, which has meant so much for the prosperity of this country since 1879; the policy of Sir John Macdonald, the policy of Sir Leonard Tilley, the policy of the present leader of the Opposition down to 1911. In the second place, conclusions as to what should be done in this matter has been reached upon the merits at the time decisions were taken, and having regard tp the national interest. And when I speak of the national interest I repeat what I said in 1916, that no one can think of the national interest of Can-

ada without thinking of the interest of the three great prairie provinces.
Now, the hon. member (Mr. Turriff) put forth a fifth criticism. It is really as unfounded and as little worth as criticisms one, two, three and four. He says: You are actuated by political considerations. One would hardly suspect my hon. friend from Assiniboia of suggesting that anyone could be actuated by political considerations. It would surprise me to learn that such a thought has ever crossed my hon. friend's mind. He says there is a coming election. What coming election?


George Perry Graham: Alberta and Saskatchewan.


William Thomas White: My hon. friend
from South Renfrew (Mr. Graham) merely interjects that. What have the Governments of Alberta and Saskatchewan to do with the question of free wheat?


George Perry Graham: Just as much as they
had to do with cement.


William Thomas White: And they had
nothing to do with cement. But my hon. friend from Assiniboia said " election," he did not say " ejections."


John Gillanders Turriff: Yes, and I meant the
Dominion elections.


William Thomas White: Absolutely. That is what the hon. gentleman .meant. What does my hon. friend from South Renfrew say to that?


George Perry Graham: The hon. member for
Assiniboia makes it stronger than I did, that is all.


William Thomas White: But he puts my hon. friend (Mr. Graham) in error.


George Perry Graham: Not at all. The Solicitor General (Mr. Meighen) will tell you.


William Thomas White: The hon. member for Assiniboia said that we had acted for political reasons having regard to the "coming election." Now let me say this: the Prime Minister of this country is about to introduce a Bill into this House for the extension of Parliament. We on this side of the House do not believe there should be an election at this time. Should there be an election, who will be responsible for it? Is an election to be apprehended? Did the Government take this action under the War Measures Act by Teason of its expectation that there would be an election when, at the same time, it is about to bring down a Bill to extend the term of Parliament? 60J
What then, is the force, and weight, and validity of the argument of my hon. friend?


Rodolphe Lemieux: The ballot boxes were sent to England two years ago.


William Thomas White: Oh, we have heard all about that.


William Pugsley: May I ask my hon. friend a question? My hon. friend has touched upon something that has nothing to do with the free wheat question?


William Thomas White: My hon. friend touched upon it for two hours last week.


William Pugsley: My hon. friend says the Government is going to bring down a Bill for the extension of Parliament. I would ask if the Government intend to deal with that as with other Government measures and carry it through by virtue of the majority they have in this House?


William Thomas White: My hon. friend is an old and experienced parliamentarian, and I am surprised at him asking a question like that. My right hon. friend the Prime Minister is also an old and experienced parliamentarian, and I believe that when he brings down a Bill to this House he will bring it down in such fashion that no fault can be found with his action. My hon. friend from Assiniboia says: You are very blameable, you are really censurable because your action has pleased the West. He spoke with a sob in his voice. He said: Your action has pleased the West. I have to admit frankly to my hon. friend from Assiniboia that the fact that the West is pleased pleases the Government and pleases me. I am glad the West is pleased. We are all glad the West is pleased, and we are glad not as politicians but as Canadians. For the last five years of continuous campaign I have been represented as the sponsor for the big interests. The impression has been sedulously and persistently created through the West that the Government is hostile to the people of the West.
I represent the interests in this House, all the interests in Canada, big and little, great and small, industrial, financial and agricultural. That is my conception of my duty. I have never favoured one interest at the expense of others, and if there is any interest in this country which I have favoured in this House, in the Cabinet, and in the councils of the Government, it has been the interest of agriculture. The people of the West and the people of the East are brothers; all the people of Canada are the children of Confederation. We have no

favourites. Any public man who is discharging his duty to the state regards the interest of every individual and every section of the country, and action is taken not in the interest of this section or of that section but in the national interest. That is the policy which we attempt to follow, and have attempted to follow, since our accession to power in 1911.
I desire to say, because this question has been raised, that this Government has done more for the West than all of the Governments that preceded it, and I am glad that we have. It is right that we should. Let me tell you some of the things that we have done. Our first action when we came into power was to enlarge the boundaries of Manitoba. We placed the finances of that province upon a sound basis, we increased her annual subsidy, because we wanted to place her on an equality with the other provinces of the west, by $600,000, and we paid over $2,000,000 of back subsidies. We enlarged the boundaries of Manitoba. It was a proper thing to do and we did it. What have we done for agriculture? My hon. friend the Minister of Agriculture (Mr. Burrell) introduced a Bill into this House wherety $10,000,000 was set aside for agriculture in the East and agriculture in the West. My hon. friend the Minister of Railways (Mr. Cochrane) introduced a Bill for the building of highways throughout Canada. That would have been a great boon to agriculture both East and West but the Senate threw out that Bill.


Wilfrid Laurier: No, no.


William Thomas White: 
Wilfrid Laurier: You had better sit down then.


William Thomas White: I have learned
in the course of my life that it is not always wise to follow the advice tendered by an opponent. My right hon. friend perhaps remembers the old Latin saying:	Timeo
Danaos et dona ferentes-I fear the Greeks when they come bearing gifts. When my right hon. friend makes a suggestion it does not necessarily follow that I am wise to carry it out. I have referred to a few of the measures which this Government has introduced. Take the banking legislation. We have amended the Bank Act repeatedly in order that the farmer may be able to pledge bis grain and may be able to hypothecate his cattle in order to get advances from the bank. We have continually kept before us the interests of the agricultural industry. Then, take the taxation measures introduced since this war broke out. They are very seldom talked about in this House, although they are criticised sometimes outside of this House by hon. gentlemen opposite. Let us see how our taxation has been raised for this war-$1,000,000 from the banks, taxation upon circulation; a few hundreds of thousands from trust companies, loan companies and insurance companies; taxation upon luxuries; business profits tax. There has been no discrimination against the farmers in our taxation measures to meet the expenditures of this war. I stated in my Budget la6t year that it would be my object to avoid direct taxation upon the income or effects or property of the farmer; Why did I say that-because I have repeatedly said in this House that agriculture is the very foundation of our national prosperity. When all goes well with agriculture, all goes well with every other class and industry in this country, and all goes well with finance. That is the reason why we have adopted the policy w'e have in raising revenue for the purpose of meeting the expenditure of the war. It is well for Canada that we should have diversified industries in both East and West. The National Policy is a policy that tends to

promote diversified industry throughout the length and breadth of Canada. It is not well that the East should be wholly industrial; it is not well that the West should be wholly agricultural. There will be boys raised upon farms in the West as well as the 'East, with a genius for mechanics, boys destined to be captains of industry. Should we not have a policy under which those boys can employ their genius at home, or must we lose them to the great republic to the south? There should be diverse industries in this country, and that is the reason why this Government is devoted to the fiscal policy which has been often enunciated in this House. The population of this country of ours is made up of various races and nationalities. It is a sparse population scattered over half a continent, a country as large as Europe. Tile policy of any Government should be to promote national unity in this country.


Wilfrid Laurier: Hear, hear.


William Thomas White: To promote toleration and narmony-


Rodolphe Lemieux: Hear, hear.


William Thomas White: -so that if we are at war, all parts of this country should be as one in the prosecution of the war. Now then, my hon. friend puts forward as a criticism of this Budget that it would please the people of the West. I say again, for myself and the Government, that if the people of the West are pleased with what has been done, they are not more pleased than we are that we have been able to do it for them.
The hon. member for Assiniboia (Mr. Turriff) puts forward an amendment. He is not content with what has been done. He puts forward a useless, an unnecessary, a trivial amendment. Is it a genuine amendment? Or is it a political expedient destined to fail of its purpose? Well, we know what it is. My hon. friend from Assiniboia has no doubt as to the validity of wdiat has been done. I have enunciated the policy of the Government to-day, and there has been read to this House the opinion of the Deputy Minister of Justice as to the effect of our action under the War Measures * Act. Why does he put forward this needless amendment? He desires to embarrass the Government, he moves it on a resolution to go into Committee of Ways and Means. His amendment will not deceive the people of the
West for one moment, not for one moment. It suggests on its face a want of confidence in the Government. It reflects on our intentions, it asperses our motives, it casts unfounded doubt upon our action under the War Measures Act. It should, without hesitation, be voted down by this House.
Mr. GEO. E. McCRANEY (Saskatoon): Mr. Speaker, the hon. member for Assiniboia (Mr. Turriff) is entitled to the thanks of this House for introducing the amendment which is now under consideration, if only for the reason that it has brought from the Minister of Finance (Sir Thomas White) a most important statement with regard to this great question, which he did not think it necessary to refer to in his original budget speech, and also for the very definite pledge which he gave to Parliament that there would be no new duties added except by an Act of this House. The Minister of Finance gave us many reasons why free wheat should not have been given before the present Order in Council was passed, and he entirely justified its passage at the present time. He says that he would not have done anything contrary to the national interest. No one would expect a finance minister, of this country, or any person in this Howse to declare that he would act contrary to the national interest. We agree with him that he is acting in accord with the national interest now. What we say to him i,s that the Government, in having delayed this relief for so long a time, was not acting in the national interest heretofore. If one reads over the Order in Council he finds that emphasis is laid upon the fact that this is to be a great relief with reference to the lower grades of wheat. That would always have been the case. That was one of the great reasons always urged in this House heretofore for free wheat. And it has been "with respect to the lower grades rather than to the higher grades that the farmer heretofore has been losing in great amount. The explanation which the Finance Minister gives as to the change of attitude from then to now matters little, but the conclusion of his Order in Council is very important. He advises the Government that it is desirable in the national interest that free access be obtained for our wheat in the markets of the United States. 1 heard my hon friend the Solicitor General the other day. In reading over his speech, it seems to me that he took other ground than that of the Finance Minister. He not only proved that free wheat would have been an evil before the Order in Council was passed, but he also proved that it is an

evil now. He laid great stress on public opinion in the West. I think that I am doing him full justice when I say that the conclusion that one would reach after reading over his speech is that there were no economic reasons which would justify the Government in having placed wheat on the free list, and that the reason which appealed to him most and which he put forward with all the force of which he is capable, is that it was a measure to conciliate the West, and that it was in the national interest, to have the West satisfied. When one decides to adopt a policy of which the economic effect is not certain, but in order to satisfy a public sentiment, whether economically sound or not, the inference is very clear that the reason is political; and one is reminded of the statement which the Solicitor General made only a short fourteen months ago that he thought that 90 per cent of the agitation for free wheat was political and that ten per cent was economically unsound. Apparently he holds that the ten per cent is still unsound and he has adopted the ninety per cent to himself. Why? The change was made in response to public sentiment in the West. As we read the war news we find that leaders of armies which have to make great retreats explain their withdrawal as a problem of strategy. They devastate the ground between the old lines and the new, and they claim to have entrapped the enemy and to have shortened their own line. So it is with this Government. Their retreat from the old position to the new is only strategy. They have given up some of their trenches; they have shortened their lines, but they have not saved themselves from defeat. There are more trenches to be taken, and victory will come to the forces which have driven them back. The battle of lower tariffs and freer trade is still going on and will come to a victorious conclusion.


John Gillanders Turriff: I would like to draw your attention, Mr. Speaker, to the fact that the Government has abdicated. There is not a minister in the House.


Mr. McCRANEY:: The hon. member for St. Antoine (Sir Herbert Ames) correctly interpreted the spiiit in which this measure has been put before the country. He accepted it as a temporary measure and held out the hope that the substitute for it in a short time would be a preference in the British market. We have had the announcement from London that there are to be Imperial preferences, and we have

also the statement of Mr. Bonar Law that foodstuffs are not to come within that preference. Agriculture, the growing of foodstuffs, is our basic industry, and the effect of Mr. Bonar Law's statement is that that great industry will have no preference. We do not feel badly about it; our farmers have never asked for a preference and I do not think they want it. They want free trade in that market as they want it in this. One wonders what class of product this country will manufacture that will have a tempting preference in the mother country. One wonders whether our people will be satisfied to abandon the newly-added market for our great products in the United States in order to obtain a market for our manufactured products in the Old country. When this Government wants to do something to mystify the public and to convince a portion of the community that they would not go as far as they actually do, they issue a proclamation under the War Measures Act. When they attempt to raise 50,000 men for home defence, and find that their Nationalist supporters do not want them to have conscription, they use the War Measures Act instead of the Militia Act. Their attitude with regard to free wheat is in much the same class. They are afraid of some of their eastern supporters, and they have not taken the strong stand that they might have taken by legislation; they prefer to give reasons which are only temporary in their character for the introduction of such important legislation. It matters very little to me whether the effect of this Order in Council ceases automatically at the end of the war. I accept the statement of the Minister of Finance that he at least will not repeal the provision of free wheat by Order in Council. I think it is most unfortunate, however, that the public are led to believe that there is hesitation on the part of the Government, and that the course they have adopted in the matter of free wheat, which should be in the line of a permanent principle, is of such a temporary character. One must recall the reasons which were given in the public press for opposing free wheat in order to see how completely those reasons are negatived by the Order in Council. Some of the objections were as follows:
It ships our raw products into another country, there to be manufactured, thus making our Canadian farmers, hewers of wood and drawers of water to the Americans.
It permits Washington to fix our tariff for us.

It will lead to the destruction of the reputation now held by our grain by enabling the Americans to mix it with their baser grades.
It will give the United States millers a supply of hard wheat, thus enabling them to chase Canadian flour out of the markets of the world.
It will deflect our grain to United States channels, to the ruin of our transcontinental systems.
It will destroy the Canadian mills.
It will encourage the Canadian farmer to continue wheat mining instead of going into mixed farming.
It will ruin the Canadian farmer by subjecting him to the competition not only of the United States farmer, but of the wheat raisers in the thirteen countries with which Canada has most favoured nation treaties.
It will prevent Canadian farmers from getting preferential treatment under the Chamberlain scheme.
And, Sir, all these reasons, so relied on two years ago by the Government, fall with the passage of the Order in Council conceding free wheat.
In the Budget speech, the Finance Minister placed before us a condition of things for which the public of Canada is to be very highly congratulated. We have an income of $232,000,000. The minister points out that our war debt arising out of the war alone has been increased to the extent of $600,000,000, and that the total is in the neighbourhood of $1,000,000,000. In addition to that, we have been able this year to appropriate $60,000,000 to war expenditure which would otherwise have been added to our national debt. A year ago the minister was able to announce an appropriation of $45,000,000 in the same way, making a total of $105,000,000 by which we have been able to reduce the war expenditure and save the public debt. That is to say, we have added to the debt $600,000,000; we have expended another $100,000,000, a total of $700,000,000, and of that amount of $700,000,000 we have paid on account only $100,000,000, in round figures.
The means which have been adopted by this Government to meet this most extraordinary expenditure are the increasing of the general tariff by 7i per cent, the lowering of the preference on British goods by 5 per cent, the imposition of the stamp duties and the business tax; and this year the minister announces in his Budget Speech a further addition to the Business Profits War Tax. The minister has pointed
out that there is no tax on luxuries, for one reason, namely because the great bulk of imports from France under our treaty with that country are in that class, and that it is necessary, in order to keep up the credit of France on this side of the water that nothing should be done to reduce those imports. One is reminded that while the Minister of Finance of this Government is so solicitous for the credit of France on this side of the water, in respect of luxuries which do us little or no good, the same Government has restricted from the mother country, which is more than our ally, importations of necessaries and not luxuries by the addition of a duty of 5 per cent, and has embarrassed the mother country in that way in the matter of exchange on this side of the water. The additions to taxation are largely out of wal profits. If we are carrying on the war with our best energy, we hope that these profits will soon come to an end; and when the war is over, we must turn to altogether new sources of income in order to reduce this tremendous debt. There is to be no income tax, so the minister says, and one of the strong reasons given is that so many people have bought war bonds and that those bonds are not taxable. Those war bonds have been purchased by some 35,000 or 40,000 citizens of Canada, a comparatively small number, and the tendency will be that the bonds of the small holders will get into the hands of the big holder, and thus the poorer part of our population will be paying interest to the more wealthy part; yet instead of taking more from the publio, the minister promises that he will borrow more.
Our men in France and Flanders are making tremendous sacrifices. One cannot read in the papers of to-day of their heroism and of the mutilation that is going on there, without thinking that we have neveT really appreciated what our men at the front axe doing. We speak about our volunteer system as though, when men were willing to go to fight, 5 p.m. they liked to go. I cannot imagine that any man of choice would go into the experiences and scenes that are occurring at the front at this moment. It is only because of the very highest sense of patriotism, of devotion to this Empire and to this country, and of faithfulness to principles that any man would expose himself to the danger of mutilation and death. Perhaps, if when the war began, we had a different conception of what it meant, we might have taken


Mr. BURNHAM:: Would my hon. friend explain that phrase "fully protecting ourselves"?


George Ewan McCraney: I do not suppose that my hon. friend understands any other kind of protection than the protection of tariffs. My idea would be a protection of good will, which is the surest foundation of peace.


Mr. JOHN WEBSTER (Brockville):: Mr. Speaker, as I do not often impose on the time of honourable members of this House, I feel that I may be permitted to offer to the Minister of Finance my most hearty congratulations on the very successful wartime Budget that he has been able to bring down at this time, being the third year -of Canada's participation in this great war. I also wish to express to the hon. gentleman my hearty congratulations on the success that attended his latest war loan, which, like the two former issues, was very largely over-subscribed. I am sure it must be very pleasant for the Minister of Finance to see the confidence that not only the people generally in this country have in him, but also the directors of our financial institutions and the citizens of the great republic to the south of us, who have invested so largely in these loans and helped to make them such a decided success. I am sure
that I voice the sentiments of the greater majority of the people of this country when I say that we hope and trust that the Minister of Finance may be spared his usual good health for a long time to come, to guide and direct the financial affairs of this country.
I am going to make a few remarks from the standpoint of the dairy farmer and to endeavour to reply to some of the questions advanced in this debate. I have no brief for the farmers of this country, but as four of the products of the farm of this particular section have been referred to in the discussion, I think it is my duty to-endeavour to place the matter in a proper light before those who dwell in our towns and cities. The four articles to which I refer are used in every household- mint, butter, cheese, and bacon. Upon these items the farmers of this section depend for their income at this season. I was amused at the remarks of the hon. member for St. John (Mr. Pugsley) and the hon. member- for Maisonneuve (Mr. Verville). It seems to me that the dwellers in the cities do not fully understand the position of the farmer. They seem to believe that the farmer is producing these articles to which I have referred at about the same cost as in years gone by. But that is a very wrong conclusion to arrive at. The remarks made by the hon. gentlemen to whom I have referred on the subject of the high cost of living are likely to give what seems to me a very wrong impression. I think the only solution of this very vexing problem is to turn some of the consumers of this and other countries into producers. I gathered from the remarks of these hon. members that they thought that the farmers of this part of Canada were receiving altogether too much hard cash for the products of their dairies. I do not -agree with that view. The farmers of this country, as was stated by the Minister of Finance (Sir Thomas White) this afternoon, are the hardest working class we have, and I rejoice that they are coming into their just rights. If the farmers are prosperous to-day I congratulate them, and I also congratulate the Government that has made it possible for them tc be prosperous. Any country that has -agriculture as its basic industry i-s bound to be prosperous. That is why Canada enjoys so much prosperity at this time.
Some of the utterances in this debate would go to show that the dwellers in our cities have not yet grasped the true position of the farmers. What is the great need of the farmers of this section to-day? Is it


George Perry Graham: This is the first time I have seen that item. I presume it is the item which appeared in very many of the papers. I read it in dozens of papers and I took occasion the other evening to ask the minister as to that and he collected it at the time.


John Webster: It appeared on April
25, 1915. While I am on my feet I am going to take this opportunity to congratulate the right hon. the Prime Minister (Sir

Robert Borden) and his colleagues on the success that they have achieved in their efforts to aid the Mother Country since the outbreak of this great world war. Let me say, Sir, that through those efforts they have succeeded in sending to the front a great army of young men, the flower of the manhood of this country, whose valorous deeds on the battle field have resulted in writing the word " Canada " high up on the scroll of honour among the nations of the world. I believe, Mr. Speaker, that the brightest pages in the history of this war will be those that chronicle the achievements of our Canadian troops and let me say, Sir, that the record will be read with the greatest possible pleasure by Canadian posterity. It was nobly said by the hon. member for Kingston (Mr. Nickle) the other evening that Canadians knew how to live and that they had proven to the world that for the cause of freedom they knew how to die. In passing, Sir, I think it is only right that I should also pay my tribute of respect to the women of Canada for the efforts they have put forth. Let me say that the wives, the mothers, the daughters and the sisters and sweethearts of Canada are those on whose shoulders have rested the greatest possible responsibilities and anxieties, and only by the supreme patriotism which they have displayed have they made it possible for this Government to achieve what they^have accomplished. They have given freely of their best, Loth sons and daughters, and I read with great pleasure the other day that there is no better class of nurses doing service in the great armies of the Allies than those who have gone from our own Canadian shores. Our doctors also have done a noble and humane work, but, Mr. Speaker, I think at the present time, we are too close to this great war to fully realize or appreciate what our own Canadian boys have succeeded in doing.
Let me say that the immortal deeds of the men of the maple leaf, the men who are proud to call Canada their home, will be recorded by the historians of the future; and generations of Canadians yet unborn will read with noble pride these pages in the book of history. When this great ^.conflict has come to an end, When this cruel war is over, and when the dove of peace has again unfolded and spread her wings over the warring nations of Europe, then Canada will stand out pre-eminently among the nations of the world as the one nation that went into this fight, not from compulsion, but from a higher, loftier and

nobler motive, a sense of duty and a patriotism that would not be denied, to secure for all time to come justice and liberty for the smaller nations of the world.
In conclusion, Mr. Speaker, let me say that we, the people of Canada, like all the citizens of the great British Empire to which we are so proud to belong, are fully resolved to face to a finish whatever the future may bring, until, in the providence of God and through the valour of our noble men, victory shall rest on our flag, and righteousness shall have been vindicated.
Mr. GEORGE W. ICYTE (Richmond, N.S.): Mr. Speaker, the intervention of the Minister of Finance in the Budget debate this afternoon for the second time would seem to indicate that something has happened to disturb the serenity which he usually displays in his addresses to this House. The papers of yesterday contain the statement that on Saturday last the ex-Minister of Militia and Defence (Sir Sam Hughes) delivered an address to his electors in the county of Victoria. In the course of that 'very interesting address he said:
In New York I was informed by a leading American financial magnate that I should not sail; that an attempt was about to be made to destroy me, and I was urged to cancel my trip. Thinking reference was had to torpedoes, I laughingly passed it off. The gentleman assured me, however, it was not torpedoes at sea, but "envenomed poison on the part of some of your own colleagues in the Cabinet who seek to get rid of the Prime Minister, but who realize that you are behind him solid, and in order to get rid of him they must first get rid of you."
The sequel to the statement of the ex-Minister of Militia is to be found in the presentation of the Finance Minister this afternoon. We remember that on Friday last the Solicitor General (Mr. Meighen) addressed this House upon the question of free wheat. There is apparently a feeling in this country supported by electors who are in sympathy with the Finance Minister that, should the conspiracy of which the ex-Minister of Militia speaks succeed, the Minister of Finance will be selected to lead the Conservative party. On the other hand, there are elector in the West supporting the Conservative party who believe that the honours and the mantle of the present Prime Minister should fall upon the youthful shoulders of the Solicitor General (Mr. Meighen). I beg to assure the Finance Minister, that the speech made by the Solicitor General on Friday evening last did not at all require his intervention in this

debate. While the Solicitor General did the very best he could, I assure the Finance Minister that he did not enhance his reputation as a special pleader by the address which he delivered to the House as to the reasons why the Government granted free wheat under the Order in Council of the sixteenth of April. I may with equal confidence assure the Solicitor General that the speech made by the Finance Minister this afternoon did not put him in a light superior to the Solicitor General in special pleading as to a subject on which neither of them appear to .have much enthusiasm.
The Minister of Finance endeavoured to get some consolation out of the volte-face which he and his colleagues turned upon the subject of free wheat, from the traditional record of the Conservative party with respect to reciprocity. He pointed out that the principle of reciprocity was accepted by the Conservative party away back in 1878 and that he was not acting inconsistently with that policy in adopting the platform of free wheat as he did on a recent occasion. I might say that the resolution moved in the House of Commons by the Conservative party in 1879 in which the subject of reciprocity was mentioned, was formulated froih a platform that was intended only for the purpose of getting into power, and the moment the Conservative party got into power they spurned the policy of reciprocity. Only when they were driven by the force of public opinion to accept its tenets was it adopted as part of their policy. We remember that in 1891 the Conservative party, having regard to the growing sentiment in favour of reciprocity throughout Canada, and being then face to face with a Dominion election, thought it would be to their interest to catch the vote of the farmers of the 'Dominion of Canada by professing to be in favour of reciprocity. But the gentlemen who formulated that policy did not receive the sanction of the Government of the United States, notwithstanding that Sir Charles Tu.pper, the spokesman of the Conservative party on that occasion avowed in the midst of the campaign that it was unnecessary for the people of Canada to support the Liberal party in order to get reciprocity, that they themselves were negotiating an extended measure not confined to natural products alone, but embracing manufactured goods as well. We know that the Secretary of State in the United States Government of that day took an early opportunity to repudiate the statement made by Sir Charles Tupper, and since then the
Conservative party did not again venture to take up the subject under the name of reciprocity, notwithstanding that, in 1879, the policy of the party was adopted to bring about a reciprocity of tariffs and thereafter a reciprocity of trade. The speech of the Finance Minister this afternoon also accentuated the fact that he and the Solicitor General are not in accord as to the results which will flow from the placing of wheat on the free list. The Solicitor General, in his speech on Friday afternoon, said:-
Where are the hon. gentlemen who in this House year after year assured us that as soon as we let .down these iniquitous harriers the Winnipeg price would advance to the Minneapolis level to the benefit of the Canadian producer? If we follow the market after the 17th of April, we find that both markets advanced together with the same smaller spread between them that obtained the day before and the day after the Order in Council was passed.
The whole argument of the Solicitor General to this House on Friday last was that placing wheat upon the free list was of no advantage whatever to the western farmer, and he endeavoured to prove this by quoting figures.


William Thomas White: I understood the Solicitor General to be referring to the higher grades, and x was speaking this afternoon with regard to the lower grades when I mentioned the payment of duty by the farmer.


Mr. KYTE:: The Solicitor General was referring to the price of wheat at Minneapolis. As I said, his whole argument was built up for the purpose of trying to convince the House that the placing of wheat on the free list would be of no advantage to the western farmer. He stated, further, that the only time when the placing of wheat on the free list might be of advantage would be when there was an export trade in wheat from the United States to Great Britain, but as there was no export trade at the present time, the result that the Liberals anticipated in the way of advantage to the farmers under an arrangement for free wheat could not possibly accrue to them now. If the placing of wheat upon the free list did not result in increasing the price of wheat to the Canadian farmer, it had the effect of immediately increasing the price of flour to the Canadian consumer. Immediately after it became known that wheat had been placed on the five list, flour took a jump of 30 cents, 50 cents and, in a few days, 75 cents a barrel. We can only argue from the observations made by the Solicitor General that at a time when the price

of wheat was low, when the farmers might reasonably accept a higher price to compensate them for their labours in respect of wheat-growing and when the price of flour was so moderate that the consumer could afford to pay a little more for his flour without feeling the burden of it, the present Government refused to put wheat upon the free list. But when abnormal conditions were brought about; when the placing of wheat upon the free list could not result in increasing the price to the farmer and would inevitably result in increasing the price of flour to the consumer, that was the time that the Government selected to place wheat upon the free list. The Finance Minister stated in the course of his speech that no industry in Canada has had greater profits since the outbreak of war than the milling industry; yet when the policy of free wheat was accepted by the Conservative party, the price of wheat for, the farmer did not increase, but the price of flour to the consumer did increase enormously. So that the consumer of Canada, after waiting for five years for the deliberate action of this Government to place wheat on the free list, is paying more for his flour than he ever did, and the farmer gets nothing in respect of the increased price of wheat.


Mr. LALOB:: Does the hon. gentleman assume that that is the result of free flour?


George William Kyte: It is not necessarily a result of free flour; it is the result of free wheat under the present conditions. It gave the speculator an opportunity again to boost the price of flour upon the pretext that because wheat was placed on the free list it was necessary to increase the price of flour. The Solicitor General has met that by saying that the putting of wlheat on the free list has not increased the price to the farmer so that'there is no justification for increasing the price of flour to the consumer.
The Minister of Finance endeavoured to convince this House that the placing of wheat upon the free list by Order in Council at this time could have had no relation to political conditions in Canada. The last time a change in the tariff was made, by this Government under Order in Council was in the year 1912, upon the eve of an election, in the province of Saskatchewan. It was the intention of the Government without previous intimation to reduce the price of cement, and an Order in Council was passed by this Government cutting the cement duty in two. That action synchronized with 
the holding of a provincial election in the province of Saskatchewan. If, therefore, at a time like this we on this side of the House find the Government by Order in Council again making appeals to the farmers of Western Canada in respect to the wheat, the hon. Finance Minister should not be angry with us if we associate his conduct in this respect with the election to be held in the province of Saskatchewan in the course of a few weeks.
The Finance Minister has taken great credit to ihimseu for the many good things which he has brought about on behalf of the farmer. I no not think it is the desire of any person on this side of the House to rob the Finance Minister of any credit or glory to which he is justly and properly entitled in respect of the effect of the policies of his department upon any of the interests of this country. He said among other things that in the interests of the farmers he had put through an amendment to the Banking Act which enabled the farmer to hypothecate his stock for the purpose of -securing loans. That was a condition which reflected not so much upon the fairness of the Finance Minister as upon the failure of the present Government to perpetuate the condition of affairs that existed when they came into office. It is true that the predecessor of my hon. friend, during the fifteen years that ihe was Minister of Finance, did not amend the Banking Act for the purpose of enabling the farmers to hypothecate their stock, because money being plentiful and farming operations profitable, it was not necessary in those days for the farmers to hypothecate their stock in order to raise money. But with the coming of the Conservative party into power a changed condition of affairs was brought about and it was neces-s-ary for the Finance Minister to give authority to the farmers to hypothecate their stock in order to obtain the -money necessary for their daily needs.
At six o'clock the House took recess.
After Eecess.
The House resumed at eight o'clock.


George William Kyte: Mr. Speaker, before the House rose at six o'clock I pointed out that the only result of placing wheat upon the free list on the 16th of April last was to increase the price of flour to the consumer, a price that had already reached such a height as to make it in many instances impossible for the working people throughout Canada to obtain for themselves and

their families the quantity of flour necessary for their support and sustenance. On the Montreal market, on the 17th day of April the price of flour had advanced 30 cents a barrel which meant a total advance of $1.40 in a week. Manitoba brands jumped 40 cents a barrel and Ontario brands jumped 60 cents a barrel by the 18th day of April. The cause of this rise in the price of flour is not the scarcity of wheat in Canada, because the market reports of that date informed the public that there was in Canada a surplus of 81,500,000 bushels of wheat. The export trade had ceased owing to the German submarines, and notwithstanding the fact that we had this large surplus of wheat in Canada, and notwithstanding the fact that the amount of the duty on wheat had been taken off by the Order in Council of the 16th of April, the price of flour continues to rise. The Financial Post, on the 17th of April had this to say:
Flour advanced twice during the week, a total increase of seventy cents a barrel, a record for flour, which brought the price up to $10.70. The highest figure for flour prior to this was $10.50 in November last. The export flour business fom Canada is practically at a standstill. The Ogilvie Flour Milling Company informs the Financial Post that space is not available for ordinary commercial business overseas. The high cost of living is a regrettable economic fact, over which the packers and canners and other distributors of foodstuffs have no control. The enormous and eager demand for our products has brought about the situation. The remedy, as far as the Canadian consumer - is concerned, is to reduce his demands.
During all this time, no effort was made on the part of the Department of Labour, that had particular charge of the question of prices under the proceedings which it had originated some months ago, to regu-iate the price of flour and other foodstuffs in Canada. The Minister of Finance stated this afternoon that the milling industry in Canada had made larger profits since the war began than any other industry. His statement is borne out by an announcement in regard to the Ogilvie Milling Company which was published in the month of October last, and which reads:
A bonus of 4 per cent, for the year ended August 31st last was declared by the directors of the Ogilvie Flour Mills Co., Limited, on its $2,500,000 common stock, at a meeting held here yesterday afternoon. The bonus will be paid on October 1st along with the regular quarterly dividend of 2 per cent., making a total distribution out of the year's profits of 12 per cent.
The bonus declared yesterday is the first extra distribution to be made by the Ogilvie Company since the stock was listed on the Montreal Exchange in 1908, although bonus payments have been popular with other milling concerns when an exceptionally good run of business has been struck. When the stock was listed the common shares were returning 7 per cent.; the rate was advanced to S per cent, in 1910 and has been held steady at that level through good times and bad.
A year ago, when exceptional profits from wheat brought the earnings up to the phenomenally high level of 95 per cent, on the common,-
That is apparently an error.
-the directors held to their conservative course, and shareholders received the usual 8 per cent and nothing more. Investment values added to by this conservation of resources have naturally been potent in increasing the earning power of the stock. The status of the company, with a large supply of liquid capital at its disposal, has changed from that of a borrower to a lender.
At yesterday's meeting the directors took the view that the results of another year's business having been extremely satisfactory, there was no reason why an extra distribution of profits should be withheld any longer.
So you will see, Sir, that the enormous prices that have been charged for foodstuffs are not due to the economic conditions brought about by the war, but rather to the advantage that has been taken of the war by the milling industry of this country to boost the prices at a time when the boosting of such prices might possibly be attributed to war conditions. I say again that the Department of Labour should have taken this condition of affairs into account and taken steps similar to those taken by other countries to prevent the undue enhancing of the prices of foodstuffs.
The Budget proposals brought down by the Minister of Finance do not indicate either courage or originality. It is the fourth Budget that has been presented to the House by the hon. gentleman since the war began. In the first session after the commencement of the conflict, the tariff was increased on certain lines, largely having reference to articles of household consumption, and again in the session 1915, another increase in the tariff was proposed by the Government and carried through this House. Last year, war taxes were levied upon the profits of certain manufacturers under conditions which have yielded to this Government the sum of $12,500,000. The Minister of Finance this afternoon took great credit to himself for adopting a system of taxation upon war profits; but the total amount of revenue obtained by

the Government from this source, according to the statement of the Minister of Finance, is $12,500,000, whereas the increased revenue obtained by the Government by reason of the increased tariffs which were placed upon foodstuffs amounts to something in the neighbourhood of $60,000,000. So, while the manufacturing interests, those who are engaged in the manufacture of war materials, and whose business has improved by reason of war conditions and the increased price of monufacturers generally, have contributed to the revenue only $12,500,000, the consumers of Canada have contributed vastly more than that; and as a consequence we have the conditions that now exist in Canada in respect to the increased cost of living. It would appear that the monied interests in this country are still paramount. We know that in 1911 the issue in Canada between the two parties was whether there should be a Government in power whose policy was to reduce the tariff and thereby reduce the cost of living, or whether there should be a Government in power backed up by the interests that found it to their advantage to oppose the reciprocity pact and thereby maintain a continuation of high tariffs in Canada. The gentle manner in which the Minister of Finance has touched the manufacturing interests by war taxation goes to show that those interests are still in control of this Government, and that the welfare of the consuming population of Canada is a secondary consideration. During the last three or four years there has been an enormous increase in the acquisition of wealth by the manufacturing interests of Canada. No such corresponding advantage has accrued to our consuming masses or to the working men who have to depend on their day's pay for the support of their families. I have here a statement taken ' from a financial newspaper of the earnings of certain corporations in Canada during the last year which shows that the Dominion Bridge Company declared a dividend for the year of 16 per cent; Price Brothers, Limited, declared a dividend of 16.1 per cent, and in regard to the Dominion Textile Company, the Financial Post states that it hears that a bonus is on the cards for the shareholders of that company which is known to have had a successful year, the sales having reached the sum of $13,000,000. It says that the preferred stock will pay a dividend of 7 per cent and the common a dividend of 6 per cent. The profits of the Canadian Locomotive Company for the cur-
rent year amount to $700,000, being 35 per cent on common stock of $2,000,000, after paying $15,000 for preferred dividends.
Stanfield's Limited, after paying bond interest, sinking funds and contingencies, showed a profit of $109,688.83, equalling 141 per cent upon the preferred and capital stock of $750,000.
The net earnings of the St. Maurice Paper Company were $363,909 in 1'915, and $2,832,277 in 1916. The balance, after interest and depreciation were deducted, amounted to $1,582,792, equalling 15-8 per cent on the $10,000,000 stock outstanding.
The Union Bank Paper Company, which owns 75 per cent of the stock of the St. Maurice Company, had interest charges of but $187,000 per annum, and the depreciation charge of about $1,061,000 last year was exceedingly liberal. The Financial Post says that it is safe to assume that at least another 5 per cent or 6 per cent of actual stock profits is concealed in the 1916 depreciation charges.
The figures for Ames, Holden & McCready for the ten months of the fiscal year which will close on April 30, shows a very large increase in turnover over the previous year, and the profits will also show a very satisfactory gain.
Steel and Radiation Company: In 1914 their business amounted to $774,231.36, and profits $13,797.02; in 1915, business $342,344:81, and profits, $123,086.20, and in 1916, business $457,389.87, and profits, $303,601.33. This discloses the extraordinary circumstance that notwithstanding their business in 1914 was almost double their business in 1916, in the former year their profits igere only $13,797.02 as compared with $303,-"601.33 in 1916. Last year the Dominion Textile Company earned profits of $1,481,195, equalling 12,5 per cent on the common stock. The Consolidated Rubber Compai y had net sales in 1915 amounting to $7,522,147; in 1916, $12,094,695. Their profits in 1915 amounted to $534,978, and in 1916 to $905,205, or 22 per cent upon the common stock of $4,125,000. The Ogilvie Milling Company declared a dividend of 8 per cent on $2,500,000 common stock, and a second bonus of 4 per cent, making a total profit divided among the shareholders of 16 per cent. It is stated that the actual earnings of the Company amounted to over 25 per cent.
The Gould Manufacturing Company had profits in 1915 of $99,069, and in 1916 of $229,447, equalling 24 per cent upon the common stock of $750,000. The Canadian

Fairbanks-Morse declared dividends amounting to 39.97 per cent, upon a common stock of $1,480,600. The Dominion Steel Foundry paid 60 per cent in dividends during 1916. The Brandram-Henderson annual statement indicates a large increase in profits during the year. The surplus available after paying bond interest and preferred dividends and making liberal allowance for contingencies amounts to 13-8 per cent of the common stock outstanding, while the total surplus now amounts to about 36 per cent.
The Belding-Paul-Corticelli Company, after allowing for preferred dividends for the year, it is understood can show a surplus equal to 10 per cent on the common stock. This will be equal to 15 per cent on the preferred, compared with 71 per cent in 1915 and 4-9 per cent in 1914.
I quote these figures to show that, notwithstanding the war conditions from which every person in this country is supposed to be suffering, one element in Canada is certainly not suffering by reason of those conditions, for these manufacturing concerns are declaring dividends to their shareholders very much greater than any they ever declared in times of peace.


Mr. STANFIELD:: Not all of them.


George William Kyte: With regard to the Bank of Nova Scotia, its net earnings for the year amounted to 19.2 per cent of the capital. The National Trust Company in 1916 had net profits of $236,254, equal to 15.7 per cent on the capital; 10 per cent was paid to shareholders and the balance carried forward.
With respect to the proposal brought down by the Department of Labour some few months ago on the subject of the cost of living, we have before us the Order in Council which was made public by the department, and on the strength of which the Minister of Labour claims credit for having done something calculated to reduce very materially the cost of foodstuffs to consumers. I will read a few sections from the Order in Council, showing the procedure to be followed. Section 3 says:
(1) No person shall accumulate or shall withhold from sale any necessary of life beyond an amount thereof reasonably required for the use or consumption of his household or for the ordinary purposes of his business.
(4) The Minister of Labour may, by notice in writing under his hand or that of his deputy, require any person who operates, controls or manages any cold storage plant, packing house, cannery, factory, mine, warehouse, or other premises in which or in any part of which any
necessary of life is prepared, manufactured, produced or held by such person for himself or for another, or who in any manner deals in any necessary of life, to make and render unto such minister precisely as required by him, a written return.
And the Order in Council states the particulars to be given in the return. Section 5 says:
Whenever the council or any municipality shall declare by way of resolution that in its opinion excessive prices are being demanded within the limits of such municipality for any necessary of life, such council may, by notice in writing under the hand of its clerk or other authorized officer, require any person dealing within the municipality in such necessary of life, and locally situate therein, to make and render unto such Council within a time set in such notice, and such person shall make and render unto such council, precisely as required by it, a written return under oath or affirmation.
And the Order in Council states the details, and then goes on:	*
If, after the receipt of any such return, such council shall consider that any circumstances justify reference of the return and a statement of the conditions to the Minister of Labour for further investigation at his hands, or if no return, or what the council shall consider an untrue or misleading return, is made, such council may, by way of resolution in writing expressing the facts and the council's conclusion therefrom report to such minister.
Section 6 says:
(1) If, after the receipt by the Minister of Labour of any return made to him or to any municipality in purported compliance with these regulations, such minister shall consider that any circumstances so justify, or if, after a return under these regulations has been required, none is made or none is made within the time set in the notice requiring such return or Within such further time as the Minister of Labour may upon special application to him allow, the said minister shall have power to investigate the business and to examine the premises, books, papers and records of the person making or failing to make such return, as the case may be, and, for those purposes such minister may appoint an Examiner or Examiners and may authorize in writing any examiner so appointed to enter and examine the premises, books, records and papers of such person, and to take evidence under oath or affirmation of any person who such examiner may believe has knowledge relating to such matters as ought to have been included within a proper return according to circumstances.
7. Whenever, in the opinion of the Minister of Labour, after an investigation and examination held in pursuance of the powers conferred by these regulations, an Tiffence against any of these regulations is disclosed: said minister shall remit to the Attorney General of any province within which such offence shall have been committed, for such action as such Attorney General may be pleased to institute because of the conditions appearing, certified copies of
(a)	any return or returns and resolutions of any municipality which may have been made, rendered or passed pursuant to these regulations and are in the possession of the minister



and relevant to such offence, and of (b) the evidence taken on any such investigation or examination and the report of the examiner.
8. (1) No prosecution for a contravention or non-observance of any provision of these regulations shall he commenced without the written leave of the Attorney General for the province in which the offence is alleged to have been committed, expressing whether such prosecution shall be by way of indictment or under Part XV of the Criminal Code.
If ever there was a gold brick handed out to the people of this country in respect to the investigation of prices and regulation of -the cost of living it is to be found in this Order in Council. Its effect is to provide that responsibility for action shall be transferred from the Government to the municipality, and from the municipality to the Attorneys General of the several provinces. There was a case in the city of Montreal where they attempted to define the procedure laid down in the Order in Council, but it was found absolutely unworkable.
I have here a statement made by the legal adviser of the city of Montreal, to the effect that the charging of high prices for commodities is not an offence under the terms of the Order in Council, and that the element of conspiracy must exist. This is given as the contention of the city law department in regard to the communication from the Minister of Labour:-
To speak only of the present case, it is established that certain coal merchants have made, all overhead and other expenses deducted, a net profit of $6 per ton. These facts have been disclosed to the Minister of Labour. He alone has the power to make further inquiry In order to ascertain if this coal was carried in excess of the reasonable quantity required for the business of each trader, or whether such increase would t>e different if such information was asked by an officer of the Department of Labour.
Here we have an instance of the practical working out of the Order in Council passed at the instance of the Minister of Labour with regard to matters in which that Order purported to give jurisdiction. But it appears that it is absolutely impossible for anything to be done under this Order in Council in the way of regulating the cost of living. Having issued the Order in Council, the minister feels that his duty is accomplished, and, notwithstanding that the prices of commodities which constitute the necessaries of life are going up by leaps and bounds without any valid reason, nothing is done to relieve the situation.


Mr. CROTHERS:: Will the hon. gentleman be kind enough to read the whole of that opinion?
[Mr. Kyte.l	*


George William Kyte: I have read all of it that is relevant to this subject. The Minister of Labour (Mr. Crothers), if he desires, can read the rest at his leisure.


Thomas Wilson Crothers: But it is only fair to read it all.


George William Kyte: I do not wish to cumber Hansard with it. There is one point that has engaged the attention of the newspaper people of this country, and th<*t is the price of newsprint paper. For a year or more complaint has been made that the manufacturers of newsprint have been boosting prices far beyond what is called for by the conditions. They called the attention of the Minister of Finance to the matter some time ago, with the result that action has been taken. We on this side have contended that the Government ought to have adopted the policy applied by the Australian Government of fixing the prices of commodities which form the necessaries of life. Objection is raised that it would dislocate the course of business, and result in bringing about hardships instead of being advantageous to the public. With regard to the price of newsprint, the Financial Post of 17th April last states:-
The Financial Post understands that Sir Thomas White holds the belief that paper costs have advanced out of all proportion and is determined to enforce his views.
It is understood that any action taken would he along the lines of regulating the flow of exports by the placing of embargoes thus automatically reducing prices. '
But, instead of doing that, the Government adopted the procedure with regard to newsprint that we asked them to adopt with regard to food products. It is stated that an Order in Council gave authority to an officer of the Government to take possession of newsprint paper manufactured in this country fixing the selling price. As an agreement had been made between the manufacturers of newsprint and the Canadian publishers, fixing the price at $2.50 the order was not gazetted. This was the order which resulted in fixing the price of newsprint in Canada. But that order was not enforced, because the manufacturers climbed down and fixed prices satisfactory to the newspaper proprietors. The Grain Growers of the West are organized, and they were able to press their views upon the Minister of Finance, with the result that a few days ago wheat and wheat products were placed on the free list. The newspapers are an influential body of great public influence, and the Government was forced to take action in order that the grievances they complained of might be

relieved. But the poor consumer, the workingman, must worry along as best he can, with the cost of living increasing and his income not increasing in proportion.
Let us see what has been done in Australia with regard to the fixing of prices and regulating the cost of living. I have here the statute dealing with that subject. After providing for the appointment of a board, the statute enacts as follows:
6. (1) The Board and each Commissioner shall, in relation to any matter as to which it or he has power to furnish a report or make a recommendation under these regulations, have power to-
(a)	summon witnesses;
(b)	take evidence on oath ;
(c)	require the production of documents, books and papers; and
(d)	enter upon any premises and inspect any documents, books and papers or any stock of foodstuffs and necessary commodities, or authorize any member of the Board or any other person to enter upon any premises and inspect any such documents, books and papers or any stocks of foodstuffs and necessary commodities.
Subsection 3 provides:
(3) If any member of the Board or any Commissioner or any other person authorized by the Board or by any Commissioner discloses, except in the course of his duty, or except to the Board ,or to the Commissioner as the case may be, any information obtained by him while upon any such premises, he shall be guilty of an offence.
Subsequent sections are as follows:
13.	(1) The minister may from time to time, on the recommendation of the Board or a Commissioner-
(a)	determine the maximum prices which may be charged for foodstuffs and necessary commodities sold, and the maximum rates which may be charged for services the performance of which is commenced, in any proclaimed area;
(b)	determine the conditions of the sale of foodstuffs and necessary commodities sold therein and of the performance of services the performance of which is commenced therein.
(2) Any such determination shall be published in the Gazette, and shall from the date specified in the Gazette have the force of law.
14.	Notwithstanding anything contained in the last two preceding regulations the Governor General may, without any recommendation of the Board or a Commissioner-
(a)	declare any area to be a proclaimed area for the purposes of these regulations;
(b)	flx the price of foodstuffs and necessary commodities sold and the rate for services the performance of which is commenced, in any proclaimed area;
(c)	declare that as regards any proclaimed area, any price fixed by or under these regulations shall, after a date specified by him, cease to be the maximum price at which foodstuffs and necessary commodities may be sold or offered for sale, and any rates fixed under these regula-
61 i
tions shall, after a date specified by him, cease to be the maximum rates which may be charged for services the performance of which is commenced, in that area.
Another section of the Act provides that any violation of the recommendations made by the commission shall constitute an offence and shall be punishable accordingly. Here is a Government that apparently is not afraid to take the full responsibility of dealing with this subject. The question of the cost of living was not any more pressing in Australia than it is in Canada but in Australia there is a Government that is in office for the purpose of governing in the interest of the whole community and not in the interest of a special class. I shall, before I am through, be able to show this House that the results of the statute passed in Australia has been to reduce the cost of living enormously as compared with the cost of living in the Dominion of Canada. The particulars, relative to the fixing of wholesale and retail prices of foodstuffs and necessary commodities and services in Australia, which appeared in Weekly Bulletin, No. 660, have caused a number of inquiries from Canada requesting more detailed information concerning the administration of the regulations and the results achieved.
Action in regard to the fixing of prices of foodstuffs and necessary commodities was taken by the Commonwealth Government under the War Precautions Act (1914-16). Regulations, known as the War Precautions (Prices) Regulations, were issued in July, 1916, to supersede price fixing measures which had been put into operation by some .of the state governments since the beginning of the war.
A commissioner has been appointed at the capital of each Australian state to administer the regulations and a Federal commissioner co-ordinates the work and is directly in touch with the minister in control of this section of commonwealth activity. The staff in each state consists of a commissioner, an inquiry officer and two clerical assistants. It is provided that a commissioner in any state may recommend that a certain article of fpod or any other goods be declared a foodstuff or necessary commodity under the prices regulations. On such item being approved it is proclaimed in the Commonwealth Gazette and inquiries are then undertaken by the commissioner in the state specially concerned, or in all states if the item is one affecting the interests of the whole Commonwealth.

Limited, only $14,297, being the same as the amount received last year. But after deducting this $14,297 by way of war tax, I notice that the stockholders were still able to receive $95,391, equivalent to 12.7 per cent on the capital stock of the company.
The Consolidated Rubber Company's profits amounted to 22 per cent or $907,500. Under the old war tax the Government took $154,687, leaving to the company $752,813, or 18 per cent upon the whole capital stock of the company. Under the new war tax the Government takes $247,500, leaving to the company $660,000, or an amount equal to 16 per cent upon the total capital stock of the company. Thus while the Consolidated Rubber Company and Stanfields Limited were content with a very much smaller dividend before the war, after paying the war tax imposed on them by the Finance Minister they will have left in their treasury a revenue from their investment far in excess of any they had received in any year previous to the war.
I take now the Dominion Canners Limited. In 1916 the net income of that company was $556,777. In 1915 there appears to have been a deficit of $294,439. In 1914 the net income was $215,123. In 1913 the net income was $380,517. So that.during this past year of the war, the Dominion Canners have earned as a net income, over $200,000 more than they received in 1913 and far more than they earned in 1914 and 1915. A statement issued by the company informs the public that the earnings amounted to 24.31 per cent upon the preferred stock of the company and 14-20 per cent upon the common stock. Taking it upon the basis of 24-31 per cent profit, the war tax for 1915 amounted to $99,125 and the company retained $457,652, equal to 20 per cent upon the stock of the company. The new war tax will amount to $177,120, leaving to the company $379,656, or equal to 17 per cent profit upon the total capital stock of the company. Under the old war tax the Government took 17-8 per cent of the profits, and under the new war tax the Government taxes 32 per cent of the profits, leaving to the company profits amounting to 82-2 per cent in one case and 68 per cent in the other.
Let us see how the products of the Dominion Canners have behaved in the matter of price to the consumers in Canada. I find in a statement that came from the Labour Department that the price of tomatoes per tin-


Francis Ramsey Lalor: What were the profits of the company in 1915?


George William Kyte: There was a deficit in 1915 of $294,439. In January, 1915, the price of tomatoes, per can, size 2i, w-as 10 cents; in April, 1917, 20 cents. The price of peas in January, 1915, per tin, size 2, was 10 cents; in April, 1917, 15 cents. Corn, per tin, was 10 cents in 1915 and is 15 cents in 1917. These were the retail prices. I now quote the wholesale prices: Tomatoes, in 1915, $1, in 1917 $1.85 to $2.15; peas, in January, 1915, 95 cents, and in April, 1917, from $1.25 to $1.50.


Francis Ramsey Lalor: When you say that the price of tomatoes was $2.15, do you mean that the Dominion Canners Company received $2.15 a dozen for tomatoes?


George William Kyte: These are the wholesale prices.


Francis Ramsey Lalor: Are they the prices at which the wholesale trade sold to the retailer?


George William Kyte: Certainly.


Francis Ramsey Lalor: Then you are not insinuating that these are the prices which the Dominion Canners Company received?


George William Kyte: The wholesale dealers got a little profit, but not as much as the Dominion Canners Company received. The wholesale dealers would not get 24 per cent profit upon their transactions, I am quite sure, as the shareholders of the Dominion Canners Company did.


Francis Ramsey Lalor: If the hon. gentleman thinks that the Dominion Canners Company is making money very fast, I may tell him that he can buy preferred stock at 75 or less and common stock at 20. He might find that, according to his ideas, a good investment.


George William Kyte: Very good, considering the fact that they are paying a 24 per cent dividend.


Francis Ramsey Lalor: They are not paying any dividend at all, either on preferred or on common stock, and they have not been able to do so for a long time.


George William Kyte: The statement to the public indicates that the earnings were 24-31 on the preferred stock of -the company.


Francis Ramsey Lalor: I am telling you that they did not pay any dividend.


George William Kyte: I have quoted from the statement of the company issued to the public- perhaps for the purpose of selling stock,

I am not sure. The wholesale price of com in January, 1915, was 95 cents, and in April, 1917, $1.75; strawberries,, 1915, $2.17J; 1917, $2.50; raspberries, January, 1915, $1.97i; April, 1917, $2.75. So you see, Mr. Speaker, how this works out. The manufacturing concerns are earning more than they ever earned before, with the result that the price to the wholesaler is greater than ever in the history of the country, and the price to the retailer is greater than ever in the history of the country, and the price to the consumer is so great that he must deny himself in many instances the luxury of eating the products of the Dominion Canners Company.


Francis Ramsey Lalor: Has the hon. gentleman
any idea of what the price of tin-plate is to-day as compared with two years ago?


George William Kyte: I do not know; it does not
affect the question.


Francis Ramsey Lalor: It affects the price a great deal.


George William Kyte: If the Dominion Canners
Company were paying such enormously high prices for their supplies, how did they come to pay a dividend of 24 per cent?
* Mr. LALOR:	I rise to say that that is
absolutely false. There is not a word of truth in that statement.


George William Kyte: Well then, the Dominion
Canners Company is sending out a statement, for the purpose of influencing the stock upon the naarket, which is absolutely untrue.


Francis Ramsey Lalor: That is not true. No statement was ever issued by the Dominion Canners Company, saying that they were paying 22 or 24 per cent profit. It would be a good deal better if the hon. gentleman would find out the facts before he made his statement.,.


George William Kyte: The point in dispute between my hon. friend and myself is as to whether the dividend was earned or paid. I do not care whether it was paid or not; the statement says that the indicated earnings on preferred stock in 1916 was 24.31 per cent. Let us see how our friends would fare if they were doing business in Australia. If Stanfields Limited were doing business in Australia during last year, instead of contributing $14,297 to the public treasury, they would have contributed 50 per cent of their total earnings, or $54,844. If they were doing business in Australia in 1917, instead of contributing $14,297, as they will to this Government, they would
contribute to the Government of Australia the sum of $82,266. If the Consolidated Rubber Company were doing business in Australia, they would have contributed in 1916 to the treasury of Australia $453,750, compared with $154,687, which they paid here. If they were doing business in 1917 they would contribute to the treasury of Australia the sum of $680,625, instead of $247,500 that they are now paying. If the Dominion Canners Company Limited were doing business in Australia they would have contributed in the year 1916 $278,425, instead of $99,125 as they did, and if they were doing business in Australia they would tribute $417,637 to the treasury of Australia in 1917 instead of $177,120 which they will pay here.
The hon. Minister of Finance takes glory to himself for the amount of taxation that he has . levied upon the manufacturers of Canada. It would he well for him to look at what the Finance Minister of Australia is doing. The new war taxation brought down by the Finance Minister a few days ago is a viery complicated statement indeed. It is impossible for an ordinary man to figure out how much any company in Canada is liable to contribute, because the minister has graduated the percentages so that earnings up to a certain amount will pay 10 per cent up to a larger amount 25 per cent, above that 60 per cent, and so on to 75 per cent. That sounds very big, but when you come to figure out what it amounts to-I had this done by the Finance Department-you see how far short it falls, so far as contributions to the treasury are concerned, of the amount contributed in Australia. In that country the Government takes 50 per cent of the profits of every company during the first year and 75 per cent of the profits during the second year. There they have a government that watches the interests of the consumers. The prices of all the necessaries of life are fixed, with the result that the increase in the cost of living in Australia has only amounted to 9.4 per cent. In addition to that, the Government takes the profits of the manufacturers, so that they do not get any benefit or advantage out of the war that is not shared by the other people in that dominion. The consequence is that instead of a trifle of $12,500,000 being collected by the war tax upon manufactures, an enormous revenue is being collected from that source.
The Minister of Finance, as I stated in the early part of my address, did not show very much courage or originality in respect

of his taxation proposals. We have in Canada a tariff that has increased enormously the cost of everything to the consumer. Apart from the tariff existing before these war measures were brought down, there was an increase of 7$ per cent,
9 p.m. not only upon goods that were previously dutiable, but upon all free goods as well. The result has been to increase enormously the cost of living, whereas the Government have allowed the manufacturers to slip by with a very small proportion of taxation, considering the enormous profits that they are making. If the Finance Minister had adopted the principle of taxation in force in Australia and had exacted fifty per cent of the profits during the first year and 75 per cent during the second year, he would be able to put every article of consumption upon the free list and would have a larger income than he has at this time. If we are to have a happy and contented people; if we are to live under conditions that will enable us to bear the burdens of the war, the Government will have to get back to sound finance and economics. They must remove the duties upon the necessaries of life, as was done not only in France and Italy, but in Germany as well, and regulate the cost as is done in Australia. The consequence is that although these nations are very much nearer to the centre of war and suffer more grievously, under war cpnditions, than we do, they are not suffering in the matter of taxation nearly as much as we are.


Francis Ramsey Lalor: The Government have just removed the duty upon flour. Perhaps you have not noticed that.


George William Kyte: 
George William Kyte: The speculator has Taised the price of flour, and the Minister of Labour,
'Mr. Kyte.]
instead of dealing with the matter himself, has passed the puck on to the city councils and the town councils throughout the Dominion of Canada, and feels that he has discharged his duty by doing so.
It is not only in the matter of foodstuffs that we are' suffering; we are suffering in the increased cost of boots and shoes, clothing, rubbers, fishing supplies. Stanfields, Limited, for instance, are reaping the benefit of the enormous protection that it is receiving. The price of underclothing has been increased enormously to the consumers in this country, and, notwithstanding the payment of the war tax, the shareholders of Stanfields, Limited, are making more money now than they ever before made in their lives. We have in this country a condition of affairs approximating the conditions that exist in countries that are actually at war. Although we are a producing, a farming country, although the opportunities for transporting our produce to the other side to remedy the conditions of scarcity in Britain are unavailable to us and v>e have millions of bushels of wheat in this country, we are suffering the same exactions and privations that we would suffer if we were actually in a state of war. The Government felt that the only means of meeting the difficulties of raising revenue was by applying the system of taxation. It is extraordinary how our friends in the Conservative party, while they always preach that we should give and should make sacrifices, in the operations of Government and in the carrying on of their trade policy, take very good care that no sacrifices shall be made by their friends the manufacturers, who support them so loyally in this House and in the country.
Another source of complaint in respect of the administration of the affairs of Canada is the enormous expenditure of money which is being carried on at a time when war economy ought to be practised, while war economy is being preached by the Minister of Finance and by his colleagues in the Government. It is just about a year ago that we had in this House a discussion about a matter which indicated the wasteful methods in force in respect of the expenditure of money for the carrying on of this war. It is about a year ago, I think, that the question of the fuse contracts was discussed in this House and was referred to a Royal Commission. I am not going to discuss the findings of that commission, but it was found that every allegation made re-

garding the extravagant prices which were paid to friends of the Government was absolutely proved from start to finish, the result being that millions of dollars were lost to the taxpayers of this country. Allison, Yoakum, Lignanti are three names that w'ere familiar to us in Canada a year ago; not only were their names familiar, but their persons and physiognomies were familiar to the residents of the city of Ottawa. We do not see J. Wesley Allison around here as we did in those days nor do we see Yoakum and Lienanti anv more. What an autocry was raised against Liberals in this House because they dared to make allegations which resulted in the findings of the Royal Commission ! My poor, humble self was singled out as a person who ought not to be at large and who should suffer dire penalties. Poor, old .somnolent toryism! It forgets that the battle for free speech had been fought in Great Britain three hundred years ago and the victory won at the cost of a King's head. I am sure that my friends opposite regret very much that conditions exist in this country that permit free speech and free discussion. I state emphatically that the Opposition sitting in this House would not be discharging its full duty if it did not bring to the attention of the Government and of the country the shortcomings and maladministration of this Government in respect of war measures andi war expenditures. What is the remedy for the condition of affairs that exists at the present time?
We have had -some discussion in regard to changes and amendments to the tariff in order to meet the present conditions in Canada. For my part, our friends in the West cannot go too far in the matter of demanding reduced taxation and lower tariffs in this country for me to follow them. Every statement and every principle that have been enunciated on this side of the House with regard to tariff and the desirability of reducing tariff and reducing the cost of living will receive hearty and enthusiastic support from me. At the present time we have sources of revenue that are quite available to the Minister of Finance and quite adequate to all the demands notwithstanding that the demands aTe very great. As I pointed out a moment ago, if the minister only had the courage to adopt the system of taxing companies that exists in Australia, he could put all the foodstuffs and the necessaries of life upon the free list and still have more than enough revenue to meet all the actual requirements of the present time. After the war, there
will be great burdens to bear, and great courage required on the part of the Minister of Finance of the day. There is one field of taxation which has not been touched yet, and which the Minister of Finance seems to be afraid to touch. I refer to the taxation of income. By reason of the war we shall have in Canada a large number of millionaires who have become millionaires on account of the opportunity given them of making enormous exactions, not only through manufacture of war material, but through the manufacture of the necessaries of life. These manufacturers would never have received their millions out of the taxpayers, had it not been for the unfair conditions that have prevailed during the carrying on of the war. There is no more promising field of taxation to meet the requirements that will have to be met after the war than to make these gentlemen contribute of the millions that they have been able to acquire, while the common people of this country have been driven to the last extreme to meet the requirements existing in their households from day to day, and. while by far the largest proportion of them: have to mourn the loss of brave sons who have fallen in the field of battle.


James Alexander Robb: Mr. Speaker, the Budget speech of the Minister of Finance contained two outstanding statements, one being that the debt of this country, which before the war was $336,000,000, had increased now to $900,000,000, and that before the end of the fiscal year it would be $1,200,000,000. For making identically the same statement, or perhaps even a more moderate statement, to their electors, some of my friends on this side of the House have been accused of disloyalty.
Another outstanding statement in the Budget speech of the Minister of Finance was that no tariff changes were proposed this year. Previous speakers have congratulated the Finance Minister upon the brevity of his Budget sipeech. Apparently, he has gone from one extreme to the other. Six years ago he was talking too much of a sort on the tariff question, hut to-day he avoids the tariff as he would a pestilence. Less than a year ago, only six months ago, in fact, when the western farmer was still marketing his crops, our Conservative friends were still strong in the faith that it would be of no benefit to the farmer to have the United States market open for his wheat. It would ruin the Canadian milling industry, they said, and would be very injurious to the dairying interests in Canada.

empty bags brought in. But what is the condition with regard to bran? The Finance Minister lays great stress upon the fact that our wheat crop was pooled with our Ally, the United States, and that we must do all we can to provide bread at reasonable prices. But man cannot live by bread alone-he must have butter on his bread. And how is this Government going to help the Canadian dairymen to produce more butter and more cheese and to answer the demands of the cities for cheaper milk and cream, when it places a tax of 25 per cent on bran and sorts coming into Canada? Let me show the Minister of Finance how that works out. Tine Order in Council enacting free wheat was passed on the 16th April. On the 14th April the price of bran in Buffalo was $43.50 a ton; in Toronto, $38 to $40, and in Montreal the same. .After this Order in Council has been in force for fourteen days, the price of bran had advanced for the Canadian dairyman to $43 to $45 a ton in Toronto, and the same in Montreal; but in Buffalo the price remains about the same as it was on April 14 (indeed a little less), prices being quoted at from $43.75 to $43.25, with $42.25 for May delivery. Thus there is no advance in the price of bran in the .United States, but an advance of $5 a ton in Canada. How does the Finance Minister think the Canadian farmer is going to answer the appeal for more butter and cheese, and cheaper milk and cream, under these conditions? But the position is even worse than that. We read in the trade journals of Montreal that last week hundreds of carloads of bran were sold for immediate or future shipment to the United States. It will not be long until there is more and cheaper bran in the United States than in Canada. You cannot blame the miller if he ships his-bran to the highest market, but if the Canadian farmer wishes to import bran from the United States he is met by a tariff created by this Government. Bran at Buffalo worth $43.25 per ton is subjected to a duty of $10.80 a ton coming into Canada. That is equal to $216, per car load. But supposing that bran dropped to $30 per ton, as bran is likely to come down as the grass gets better, the duty will be $7.50 per ton coming into Canada, or, in other words, the Government will be collecting from the farmer on every carload of bran that he brings into this country $150. Supposing bran again drops to $20 per ton the duty will be $5 per ton or $100 per car load. In other words, for every car load of bran, made from Canadian wheat milled in the 
United States, that the Canadian farmer brings into Canada, the Government demands one of his best cows.
My hob. friend from Brockville '(Mr. Webster) this afternoon pointed out that the price of live stock was almost double what it was five years ago. He gave as the reason that the farmers could not raise live stock profitably if they shipped their milk and cream. I would like to show my hon. friends how they 'are responsible for this condition. Had we accepted the reciprocity proposal we would have had a market for our butter and cheese in the United States. But we turned that down. The United States revised their tariff and placed milk and cream on the free list. The immediate result of that change was that, from all the eastern townships and from parts of Ontario where they could ship, carloads of milk and cream were going into the United States. Where they could not ship the milk and cream they shipped the cow. Canada lost not only the milk and cream, the butter and cheese, but the profit on the cow, and the labour that might have been utilized on Canadian farms and in Canadian factories manufacturing Canadian cream into butter and cheese to be exported as butter and cheese. The result of this condition is set forth in a bulletin prepared by Mr. Grisdale of the Experimental Farm. Hon. gentlemen can find it in sessional papers No. 16, of the year 1917. In 1913, the year the United States revised their tariff, Mr. Grisdale says that there were 2,188,824 milk cows in eastern Canada. In 1915, after two years of this policy, under which our milk and cream were going to the United States, and under which butter and cheese were prohibited, the milk cows of eastern Canada had decreased in number by 113,074. But it was worse with young cattle. Mr. Grisdale says that in eastern Canada, in 1913, there were 2,479,406 cattle other than milk cows. Two years later the number had decreased by 603,902. That is a condition that has been brought about by changes in the United States tariff. I would plead with the Minister of Finance; just now we have a demand from the housewives of Canada for the admission of oleomargarine, for anything at all to get cheaper fat stuffs for the bread of the children. We have a demand from the cities for cheaper milk and butter. The farmer is blamed for advancing prices. The Finance Minister answers that demand by compelling the Canadian farmer to pay in his own market $5 more for a ton and $100 more for a carload of bran than he was paying fourteen days ago. He has placed

the further restriction upon the Canadian farmer that if he imports bran from the United States under the present conditions he is met at the custom house with a price of $216 per car loa4. The Minister of Finance boasted this afternoon-and I am just as proud as he is that I am a farmer's 'boy. He was proud to have been on the farm. I know that the Minister of Finance knows something about farming, probably more than our western farmers do. Farming in the West, after all, is not a very strenuous occupation. The man puts in his crop and waits for it to ripen, then he harvests it, markets it, and he is through. But, in eastern Canada, where men milk and provide milk, cream, butter and cheese for the cities, farming is altogether another proposition. Where a man on the farm has to rise on a cold winter morning and go out to the stable with a coal oil lantern it is a slavish job all the way through, and under these circumstances how can the Minister of Finance expect that the farmers are to increase their herds of milk cattle when the Government creates conditions that make it more expensive for them to produce? I hope the minister will change his mind, and that before we get through with the session he will introduce such legislation as will enable our Canadian farmers to get their bran and shorts without being compelled to go to the custom house and pay an increased tax.
This is a time when we all admit that we have made mistakes. The hon. Minister of Inland Revenue (Mr. Sevigny) openly acknowledges that he made a mistake in 1911. The M'hiister of Finance himself has acknowledged that he made a mistake in opposing tariff concessions in 1911. He has made that acknowledgment by an Order in Council. Statesmen from overseas are in Washington in order that by consultation and advice our new Allies may avoid the mistakes made by us in earlier days. Our own veteran statesmen, the hon. Minister of Trade and Commerce (Sir George Foster) is at Washington and the newspapers tell us that the Minister of Finance and my hon. friend and former fellow-citizen the Minister of Inland Revenue are also to go to Washington. Why not take advantage of the occasion to say to our neighbours that in 1911 we were wrong when we declined to accept their fair trade with them? Let us have a fair trade that will be satisfactory to the East and the West. Will the Minister of Finance rise to the occa-them? Let us have a fair trade that will be conditions which will satisfy the East and
the West and prepare the road for a growth and extension which we all hope for Canada, or will the Minister of Finance leave that to his successors? That is a question I am not able to answer.
If I were looking to my own interest and that alone, I would not object too strongly to this protection on bran and shorts. But I am not elected to this Parliament of Canada to look after my own business. I am elected to look after the dairymen of the constituency which I represent, and I beg to submit an amendmeht to bring the matter fairly before the House. I beg to move, seconded by Mr. Kay (Missisquoi) as an amendment to the amendment:
That to ensure a plentiful supply of bran, shorts, and middlings for the farmers to produce millc, cream, butter and cheese, and for the raising and fattening of livestock, this House is of the opinion that wheat, bran, shorts, and middlings should, without delay, be placed, on the free list.


Mr. DEPUTY SPEAKER:: This amendment is out of order because only one amendment can be moved to the motion to go into Committee of Ways and Means.


James Alexander Robb: Then I give notice that when the amendment of my hon. friend for Assi-niboia (Mr. Turriff) is disposed of I shall propose this amendment.


Mr. JAMES MORRIS (Chateauguay):: Mr. Speaker, in rising to ask the attention of the House for a few minutes I certainly do not intend to delay the House at any great length. I have not been in the habit of taking up much of the attention of this House while I have been a member, and I suppose that it is but right that I should occupy one of the back benches. But, Mr. Speaker, representing as I do an agricultural district, I feel that it is. my duty to extend to our Minister of Finance the congratulations of the agriculturists of my county, not only those of my county but the agriculturists and, in fact, the whole people of Canada, on the manner in which he has handled the financial affairs of this country. Without going back to the Budgets of the past, let us take simply the one that is before the House to-day.
But before going any further, I feel that I should reply to one statement that the hon. member for Huntingdon (Mr. Robb) made in his opening remarks, when he referred to the men on this side of the House as allies of the Nationalist party. I would aAk him to look to his friend the member for Laprairie-Napierville (Mr. Lanctot) if he wants to know what a Nationalist is.

The hon. gentlemen on the other side of the House have accused us of an alliance with the Nationalist party. They accuse these men here of being Nationalists. They deny them the right of reformation. But let him look to his friends on the other side of the House for the last two years who have been preaching the doctrines of the Nationalist party, and no man knows it better than my hon. friend the member for Huntingdon (Mr. Robb). He has seen the evidence of it right in the village of St. Remi where the hon. member for Laprairie-Napierville had as his principal orators Armand Lavergne and Tancrede Marsil. Let him look into the history of the Nationalists of this country, let him look into the history of the men who have been preaching treason, nothing short of treason, gentlemen, and he sits there, the man who had two of those men as his chief speakers. Then they accuse the Conservative party of connection With the Nationalists. Shame, I say, on hon. gentlemen opposite. If anything, let us be honest. If we are wrong we will admit it. There are men sitting on the Conservative side who have admitted that they did entertain principles favourable or in keeping with the Nationalist principles. They have seen the folly of their ways and have reformed and to-day they are accused by men on the opposite side of the House because they did reform. I would ask hon. gentlemen if Jesus Christ accused St. Paul for reforming? St. Paul was a persecutor of Christ at one time. Did you or any man ever hear of Christ accusing St. Paul for having reformed? Oh, woe unto ye scribes and hypocrites.
I had no intention of launching into a discussion of that sort when I rose to speak. I rose in the first place to congratulate our Minister of Finance, not only the Minister of Finance but the whole Government, on what they have accomplished within the last five years. I think that I have the people of Canada hack of me when I make the statement that without going back to former Budgets, the Budget that is to-day under discussion has the approbation of ninety per cent of the honest people of Canada, regardless of the criticism that you hear from the opposite side of the House; for we know, and we can fully realize by the nature of the criticism that has come from the opposite side of the House, that the hon. gentlemen opposite are not sincere and consequently are not honest in their criticism. We can have no better illustra-
tion of it than in regard to the matter of free wheat. Hon. gentlemen opposite have been clamouring for that for a number of years.


William Pugsley: Hear, hear.


James Morris: Now they have got it, and yet the criticism of the Government to-day is stronger than ever it was before, which leads me to believe that for political purposes hon. gentlemen opposite would deprive their people of what they have been clamouring for for a number of years. We can only judge of that by the statements they have made in the House. I feel justified in saying that the great majority of the people of Canada to-day are satisfied and are offering their congratulations to our Minister of Finance on the manner in which he has handled the financial affairs of Canada. I have no intention of going into details of our national finances. That has already ben done so thoroughly, and the situation has been so well elucidated by the minister himself and by the Solicitor General, that it would be folly on my part to attempt to delve into it. Besides that the financial situation to-day has developed into such tremendous proportions that I am free to admit that it is baffling to the ordinary mind. But we feel to-day that in the man who has charge of the finances of this country we have a master of finance. Future history will record him as such. Not only can I say this of our Minister of Finance, but if I had time I might go over all of the departments and point with pride to their administration.
I will simply gii*e the house a few impressions. Next to the work that has been accomplished in connection with the finances of Canada is that which has been accomplished by the ex-Minister of Militia. I feel satisfied, Sir, that when the history of this country shall he written, the name of Sir Sam Hughes will go down to posterity as one of the greatest men of Canada, notwithstanding the vile attacks that have been made by some hon. gentlemen opposite upon his character. They did not dare to come out openly with any statement, but by certain charges that were made or insinuated, they attempted to cast slurs on his name. But the attempt was an absolute failure, and the verdict of the people to-day is that the charges which were made in this House last winter were without foundation and were brought forward purely for political purposes.
Mr.' TURRIFF:	Why did the Government kick him out, then?


James Morris: The Government are not kicking. They are going to make hon. gentlemen opposite kick 'before they get through with them. As the representative of an agricultural district, I should not fail to make mention of the Department of Agriculture. I feel sure that I shall be backed by 90 per cent of the people whom I represent when I say that the present Government has done more for agriculture than ever has been done in our district in the past, particularly in connection with the live stock industry. I shall not attempt to go into the details of the work of the Department of Agriculture, which is better known perhaps, ito other members of the House than it is to me. One branch that I wish especially tp call attention to is the Live Stock Branch, particularly the distribution of male animals, which had its origin in the mind of our late friend, John Bright, who was the head of that branch of the department. En passant, Mr. Speaker, I do not think that it would be out of place if I were to say a word with regard t,o the death of our friend John Bright, who, I feel, is lamented by agriculturists from one end of the land to the other. He has, perhaps, done more for that particular branch of the department than any other man living. There originated in the mind of John Bright things that never were done in Canada before. He was attentive to his duty, courteous to any one who met him and ready to give good advice and counsel to any one who went to see him. I feel that Canada, and particularly the Department of Agriculture, has met with a great loss in the death of John Bright.


George Perry Graham: Hear, hear.


James Morris: We have heard a great deal about free wheat. I was somewhat surprised to hear the hon. member for Huntingdon (Mr. Robb) criticise that measure. Like many of his friends in the past, he has agitated in favour of free wheat. In rejecting that measure the Government did perfectly right, and under former conditions I am pleased to say that this measure is not a change of policy; it is simply an emergency measure consistent with the trade policy always followed.


George Perry Graham: Hear, hear.


James Morris: It was done to meet the extraordinary conditions that have been brought about by the submarine warfare.
I am glad that we have a Government that is large enough and broad enough in mind
to meet ^situations of that kind. I would myself prefer that this be not a permanent policy, because I do not believe that free wheat would eventually be a benefit to the farmers of the West. Moreover, in legislating here we must have Tegard to the farmers of the East. The member for Huntingdon knows as well as I do that the stock men of the East are dependent, in a large measure, on the by-products of wheat. If we send our wheat to the United States we shall be deprived ^f that by-product, and, as a matter of fact, do injury to the stock men of the East by granting free wheat to the farmers of the West.
I have listened with a great deal of attention to the speeches delivered by the hon. gentlemen opposite. I have no doulbt that had these same gentlemen gone before the country when the agitation for the Transcontinental railway was in progress they would not have dared to make the statements that they have made in the House to-day. The principal argument made at that time was the necessity of transportation for the great products of our western country-the transportation of our manufactured products from the East, and of the products of the great prairies from the West. That was a reasonable argument, and the people accepted it, the Transcontinental railway was built upon that ground. These same gentlemen now tell us that we should deprive this road of the benefit which would accrue to it through the transportation of the products of the West, by diverting those products to the south. I have been a Rrotect-
10 p.m. ionist all my life, and, my belief in the principle of protectionism is stronger to-day than ever it was. Before hon. gentlemen opposite took office in 1896, the great dividing line between the two parties was protection or free trade. Hon. gentlemen opposite advocated free trade, although possibly they were not all out-and-out free traders. Just as soon, however, as they came into power, they swallowed with one great gulp all their free trade talk and they simply had to come down from their perch and accept the Conservative policy of protection. That fact is well known to the people of Canada, regardless of what hon. gentlemen opposite may say. If one talks with the thinking men of this country, one will soon realize that. There are a few things that come home forcibly (to jthe ordinary man, and I will cite only two of the reasons why I am in favour of protection. In the first place, it cannot be denied that this country of ours has prospered greatly under a protective policy; second-

ly, we have only to look to the Republic to the south of us to see that it has grown to be a great nation under one of the highest protective tariffs in existence. These are evidences that cannot be denied,
I' care not what arguments may be brought forward. They are facts going down in history and they cannot be gainsaid. It is said that Great Britain has prospered under a policy of free trade, but conditions there are absolutely different to-day from what they were when Great Britain was in the process of establishing her manufacturing industries. We are told that during the Spanish war the workmen of Great Britain learned from the people of Spain-the methods of manufacturing fine fabrics, and that when the Spanish war was over, they came home and put into operation what they had learned in Spain. Great Britain thus grew with practically no opposition until it became the greatest manufacturing nation in the world. When my hon. friends opposite seek to cast reflections upon the manufacturers, they are making a great mistake. We require the agriculturists, but we also require the manufacturers to consume what the farmer produces, and we have that illustration in Great Britain which has become, if not the greatest, one of the greatest nations that the world has ever known, and that result has come about principally through her vast manufacturing industries. Circumstances change, however, and Great Britain now realizes that she has made a mistake in recent years in not putting on a protective tariff. We can see now that Germany had made inroads into the trade of Great Britain and of all her overseas Dominions. Right in our own country we have seen the inroads that the Germans had made in selling to us products that we could manufacture ourselves, and that I think we shall manufacture in the future. That goes to show that a protective policy is the only proper policy for a young country such as Canada.
Perhaps hon. gentlemen opposite as well as hon. gentlemen on this side of the House feel that I am in rather a happy frame of mind, and I may say that I am in so far as this Government is concerned, because as a supporter of this Government I do not think that we have anything to fear in appealing to the country. Although no man in this House or in the Dominion would regret more than I would a general election at the present time when our country is at death's grip with an enemy, yet I feel sat-
isfied that with the record that this Government has at its back, we can go to the country with confidence. I would feel sorry for. a man who endeavours to force an election on this country at the present time because I know that that is contrary to the wishes of the people of Canada regardless of their politics. Some of the most staunch Liberals in my constituency are absolutely opposed to an election at this time. The hon. member for Huntingdon (Mr. Robb) notwithstanding the efforts he has been making during the past year when he has absolutely violated the truce, knows that the people , of his own constituency do not approve him; he knows that the Liberal catechism of his own county, the Huntingdon Gleaner, condemns the action that he has taken during the last two years. Later on, Sir, I may have occasion to refer to those matters, but for the present nous avons fini.


Mr. LEVI THOMSON (Qu'Appelle):: Mr. Speaker, I do not purpose answering the charge of dishonesty. We on this side of the House occasionally have charges of disloyalty and of want of patriotism hurled at us, and my hon. friend (Mr. Morris) in the desire to make a few more charges against us, charges us with being untruthful, insincere, etc. We are quite willing to let those charges go for what they are worth. I would like, however, while the Minister of Finance is in his seat, to refer to one remark of my hon. friend. I was unfortunately absent when the minister was speaking this afternoon, but I understand that he said that the Order in Council providing for free wheat would not be repealed except by the authority of this House, while the hon. member for Chateauguay (Mr. Morris) says that it is merely a temporary war measure and not a policy at a11 I must say that the remarks of the Solicitor General are open to the same construction as the remarks of the last speaker. If I am correctly informed, the remarks of the Minister of Finance, however, are not on the same line.. I am advised that be said this was a permanent policy until repealed by the House. I will leave the last speaker and the Solicitor General and the Minister of Finance to settle these things amongst themselves. We can take whatever meaning we like out of the speeches, and I suppose that was their intention. If we want to believe it is a permanent policy, we can. believe it; if we want to believe it is a temporary policy, we can believe that, and so on. No doubt

these opinions are given out to satisfy different sections of public opinion.
A short time ago I read an address delivered by the Minister of Finance at St. James Methodist Church, Montreal. He disclaimed any intention of preaching a sermon, but I think myself it was rather a good sermon that he delivered on that occasion. His subject was, Self Denial and Self Sacrifice; a very good subject to preach on whether in a church or in this House, and it struck me it would not be a bad text for the minister to dilate upon before his special friends, the highly-protected interests of Canada; I think an address of that kind is very much needed in that quarter. The Minister of Finance, it seems to me, might equally well have called his subject *' Efficiency.*' Among other things he said at that meeting:
Increased production is necessary, increased agricultural production especially. Every acre, every plot of land in the Empire, should be made to produce this year to the utmost of the human energy available for the purpose.
Further on he says:
It is the bounden duty of every citizen to multiply his efforts to greatly increase production.
The minister is right. Increased production of foodstuffs for the Allies is sorely needed, and Mr. Balfour eeems to have impressed, this need upon the people of the United States. But in order to secure this increased production there must be increased efforts and increased efficiency. There are difficulties, however, in the way of increased production in this country. Speaking of the particular part of the country with which I am best acquainted, we have many difficulties to contend with. We have had two bad threshing seasons followed by two late springs, which have greatly curtailed spring and fall ploughing, and necesarily curtailed also the production of food stuffs. These difficulties, unfortunately, have at the same time increased the danger of a luxurious growth of the farmer's great enemy, the weed crop. Those however are not the only difficulties with which the food producers of our country have to contend. Some difficulties cannot be avoided, but others can. One of the great difficulties with which the farmer has to contend i6 the increased price he has to pay for his implements, caused by the high protective tariff imposed by this Government. In my part of the country the threshing season is very short, lasting only a few weeks. We are obliged to thresh out of the stook, because 62
it is impossible to ge the labour to stack. The result is that any man who has very much of a crop is obliged to have a threshing outfit of his own, not the very largest obtainable, but one that will cost him about $2,500. The most up-to-date outfits cost from $5,000 to $6,000, but the ordinary farmer would get one for his own use costing about $2,500. The duty the dealer would pay on that machine would amount to about $500. The dealer would undoubtedly charge the farmer something additional on the duty 'he was obliged to pay, let us say ten per cent on the $500; that would be $50, making $550 duty which the farmer would have to pay. Anyone who was asked to pay a direct tax of $550 for some article needed in his business would think it a tremendous charge, but it is only one of the many indirect taxes that we have to pay on account of our protective policy. If the threshing machine that was bought by the farmer was manufactured in the United States $500 of the amount paid by him would go into the treasury of this country; we are not grumbling about that. If the machine is bought from a Canadian manufacturer, the price would be just the same, if not a little more. But if the machine is bought from a Canadian manufacturer no part of the $500 duty that the farmer would otherwise pay would go into the treasury of this country; it would all go into the pocket of the Canadian manufacturer. Now, I find that in the last year for which we have official figures for the manufactures of Canada, we manufactured four times as much as we. imported. If that is true with regard to threshing machines, in order for the treasury of this country to collect $500 duty we should have to pay duty on five machines, one imported and four manufactured. I ask you if that is good business. It is an indirect tax it is true, but we have to pay it just the same as if it were a direct tax. The same remark applies to seed drills and a great many other farm implements. Self-sacrifice is needed not only on the part of the farmers, but on the part of the manufacturers as well. Our farmers were criticised for refusing an offer to sell their wheat to the Allies at a price less than one half the market price, and were even looked upon as disloyal by some. But we have got accustomed to this cry of disloyalty and want of patriotism. Only a few days ago an hon. gentleman on this side of the House who has a son at the front, and was anxious to see that he was not exposed to unneces-



sary temptation from the wet canteen, was told that he was unpatriotic for bringing up the subject in the House. Now, I think it would be a great deal better if we cut out these charges of disloyalty and want of patriotism. Many of us have sons at the front and may hear of their death at any moment, and if ever there was a time when this cry should not be raised, surely it is now. I would not like to charge any man with disloyalty, not even those political colonels who strut around our country in the King's uniform, drawing big pay, and who have been on a free trip across the Atlantic to England or France, but who, the moment they smelt gunpowder, turned tail and skipped back home, leaving their men to go to the front without them. I would not charge even these men with disloyalty, though it would be far more reasonable to do so than to make the same charge against our farmers. Sacrifice is needed not only from our farmers, but on the part of our manufacturers as well. There have been cases of self-sacrifice on the part of manufacturers in Canada, but these have been isolated cases, and we want it to be a general thing. The duties on the farmer's tools of trade, if I may call them so, should be absolutely taken off, and the customs duties reduced on other things required by the consumers of this country. Efficiency is needed by the farmer. But efficiency is needed also in all walks of life, and in no place more than in the Department of Finance, but I am afraid there are not many places where it is less shown.
We have heard references to after-the-war conditions, and, though I have little hope of seeing the war end as quickly as some people have, it is worth our while to consider the probable state of affairs after the war. There are troubles we shall have to bear, which will only begin after the war is over. In the first short session after the beginning of the war, we voted $50,000,000 for war expenses. A few months later we voted $100,000,000. In the session following we voted $250,000,000, and this session we have voted $500,000,000-ten times the amount of our first vote; and not a single vote of those I have mentioned has been less than double that which preceded it. I think the man would be rash who should say that we were not almost sure to have another vote in this House, with a strong probability that it will be double the last. I trust that will be the last we shall have, but of course we cannot be sure. All this means that we shall have

an extra indebtedness caused by the war of from $1,500,000,000 to $2,000,000,000. We shall also have a yearly pension list of $30,000,000 to $50,000,000. The man who thinks we are not liable to such an amount must be very sanguine as to the early end of the war. That means that we shall have to raise in the neighbourhood of $150,000,000 a year on account of the war alone, besides all that we must raise for other purposes. We hear the boast made that last year we had some $60,000,000 to the good, notwithstanding the fact that we paid $25,000,000 in interest on war indebtedness and pensions-$85,000,000 In all. But we must remember that in these years of war we are sure to be in a very much better position to pay large sums than we are likely to be afterwards. It has been admitted over and over again in this debate, that conditions are abnormal, that revenue and exports are abnormally large. I do not know what our exports of war material are, but I find that for the year 1916 our exports of cartridges alone amounted to about $225,000,000. It is plain that the only reason why our revenue exceeds our expenditure this year is to be found in these conditions, otherwise, we should be far behind, we should not have one cent of surplus to pay towards our indebtedness or pensions or interest on war debts.
The question of income tax has been discussed occasionally in this House. The Minister of Finance objects strongly to an income tax on account of the cost of collection, but I do not think he will deny that the cost of collecting an income tax is trifling compared with the direct and indirect cost of collecting customs taxes. The last year for which we have official figures of the manufactures of Canada is 1910. I find that during that year we manufactured goods to the value, approximately, of $1,166,000,000. Of these, we exported $144,000,000, leaving $1,022,000,000 of home manufactured goods to be consumed in Canada. Our imports of manufactured goodfs for the same year were nearly $255,000,000. I think we are safe in saying that, generally speaking, the same price is paid for home manufactured goods as for the imported goods. We paid an average duty on imported manufactured goods of about thirty per cent, as nearly as I can gather.
We have listened to the arguments of the Solicitor General on free wheat, and I think those arguments work in very well here. He told ^us that now that the duty is eliminated, the prices in the importing market are what they were before, less the

duty. That is the actual result he finds in the case of wheat. But the same would be the result in the case of imports of manufactured goods. If the Solicitor General is right in his contention, then, if we throw off the duty from $255,000,000 of imported manufactured goods, we decrease the price not only of those goods but of the home manufactured goods as well to the former level in the importing country less the duty. That is the Solicitor General's own argument in the case of wheat, and if it is a good argument it must apply to manufactured goods as well. We pay $30 of duty on every $100 worth of goods -we import. Then we pay about $3 more as a profit for the importer who pays the duty, making $33 on every $100 worth of goods. We consume of home manufactured1 goods about four times as much as we import, which would represent. higher prices equal to $132 for each $100 worth of imported goods. Adding this to the $33, you have $165 which we pay out in order that the revenue may receive $30. Is that efficiency? I submit it is not; it is the most wasteful way we could adopt for the collecting of revenues. Yet we follow this method at a time when it is most important that our methods should be efficient, and that for every dollar we pay in taxes as much as possible should go into the public treasury. People are beginning to recognize the iniquity of operation of the tariff, and the Toronto News, the chief journalistic spokesman in Canada, I suppose, of the manufacturers, as the hon. Minister of Finance (Sir Thomas White) and. the hon. member for Montreal, St. Antoine (Sir Herbert Ames) are the chief spokesmen for protected interests in this House, has the following in its issue of 24th April, 1917:
Manufacturers and the Future.
If the Daily News may speak a word in season we would advise the Association to take every feasible means of justifying- fiscal protection as essential to Canadian industries, to the employees of these industries and to the country as a whole. For the most part the manufacturers have a good case and they should place it before the people in effective form. A tariff ferment is working. The Western farmers want lower duties, but on the other hand the war has brought a strong hope of inter-imperial and even inter-Ally trade arrangements supported by preferential tariffs. The Dominion could not prosper industrially without fiscal protection, and this is why the people support it. The system could never be maintained in the interests of the manufacturers alone, but as the manufacturers control the enterprises and business fostered by the tariff they should take the lead in making its advantages understood by the people.
62J
The manufactures pf Canada have never "been .slow in trying to educate the people upon the effects o-f protection. However, I think the News feels that they must be a little smarter about it, .that there is danger ahead, and that a tariff ferment is working. If the newspaper means that the people are thinking along tariff lines and are beginning to realize the iniquity of the tariff, it is quite right. I do not say that the customs tariff must at puce be completely abolished, but I say that a manufacturing industry which requires 30 per cent protection in this or any other country is not suited to the country and it is not in the interest of the country that it should be carried on. An industry that cannot thrive on a 10 pr 15 per cent tariff is not suited to the country and should not he continued. I believe that if we 'would make 15 per cent our maximum tariff rate we would have just as much manufacturing in Canada as we have now, Canada would be more prosperous and the wages paid would be better because we would only carry pn manufacturing industries that are suited to tile country. The people are thinking along tariff lines to-day. The sentiments expressed so forcibly here from time to time by my hon. friend from Bed Deer (Mr. Clark) are just the very sentiments that are filling the minds of the people from the Atlantic to the Pacific, not only the people on the western prairies, hut the people of the Maritime Provinces, Quebec and even a very large part of Ontario, protectionist as it is. It is a matter that is receiving a great deal of attention on the part of the people and they are realizing the iniquity pf the tariff.
I have been told by a prominent manufacturer in Canada that on some lines of manufacture where the duty is highest the manufacturers are making no money and that they must have more protection- to succeed. What does that mean? It means that while in some oases we pay $130 or $140 for goods that we cpuld buy but for the tariff for $100, we are paying that $30 or $40 -into the pockets of the Canadian manufacturers for the purpose of making millionaires while in other cases we are throwing the money away. If it is doing no -gpod at all we might as well throw it into the fire if my information is right. What is the use of paying these tremendous duties if they are doing no good? I would say at once, abolish these duties and let the manufacturers who are engaged in these lines of manufacture go at

some work that is suited to the country. The Solicitor General told us something in regard to the western free trade sentiments, and I 'believe he understands the subject. Some people suggest as a solution for this trouble the establishment of large manufacturing industries in the West. I think that probably the Solicitor General knows the difficulties in the way and that this is net a solution of the question. In conversation once with a prominent Conservative protectionist, he advanced the theory to me that the proper way to do was to establish a tariS between the . East and the West so that we could develop manufacturing industries in the West. If we established a tariff against the East we might have protection of the West against the East. If it is correct to say that manufacturing industries are essential to the East surely it is just as correct to say that they are essential to the West, with the tremendous capabilities of that country. We have a country which is capable of sustaining ten times the present population of Canada and we are told that in order to sustain a big population we must have manufacturing industries. I think my Conservative protectionist friend was not so very far astray if his views were right. But they are not correct. I. told him that he was following the protectionist argument to its legitimate conclusion, but that I had no use for his proposal.


Mr. BLAIN:: How does my hon. friend explain that Winnipeg is the third largest manufacturing city in Canada?


Levi Thomson: I do not propose to
enter into an argument with regard to Winnipeg, because Winnipeg is not a typical [DOT]city of the West. It has water powers which the rest of the country has not. The Solicitor General can answer that question better than I can. I am speaking for the large plain district west of Winnipeg. If my hon. friend from Peel (Mr. Blain) will come with me to southern Saskatchewan I can take him for days and weeks during the winter time and he cannot find a water power that will run a coffee mill. I think if he talked a little while to the Solicitor General he could put him right on that, and I think the Solicitor General would not for a moment advance that plan of solving the question. In Saskatchewan I have ripened tomatoes very successfully and I know that some people have ripened apples there. Our British Columbia friends tell us that in order to prevent the prairie farmers from eating American apples they must have a considerable amount of pro-

tection. We have as good a right to forbid our farmers eating British Columbia apples as the British Columbia men have to prevent us eating American apples. It would take far more protection to shut out British Columbia and American apple growers in favour of the Saskatchewan apple growers than it takes to shut out American apples from the prairies. But the theory is the same. If it is right in one case it is right in the other. Surely we have a right to our own market if we can grow enough " tomatoes to supply the demand in Saskatchewan. But, probably our consumers would.have to pay more for tomatoes and probably the men who grew tomatoes would do better if they were to go into some other line. Their case seems to me to be the same as that of the manufacturers who are not making any money. But then think of the home market right at our door, instead of going a thousand miles across plains, over mountains and through tunnels to get to that home market. If the argument is good in one case it is good in another. That is the sort of argument we continually hear in favour of protection, this blessed old home market out of which we can make so much money and out of which we never make anything. I do not believe in the theory that any one part of Canada should have protection against another. I do not believe in the theory that we should have this exorbitant protection in favour of any one class of people in Canada as against another. I believe we should produce things suitable to our own soil and climate and that we should buy other articles from those who are in a better position to produce them than we are. I believe different soils, different climates, different conditions and even different temperaments were given us for a great and wise purpose and I am sufficiently old fashioned in my belief to be satisfied that it is poor business kicking against the goads or against the Creator's plans.
In the year 1910, we manufactured goods for home consumption to the value of $1,022,000,000; and they say that we paid duty on the whole of this amount, eitheT into the treasury of the country or into the pockets of some one else, or else we threw it away in oases where the manufacturer was not making any money. We are told that this creates a wonderful home market for us. What about that home market? I find that to produce not only that $1,022,000,000 but the whole $1,166,000,000, wages and salaries are paid to the amount

of $241,000,000, less than 24 per cent of the cost of the manufactured goods. We are paying 25 per cent and 30 per cent on that in order to encourage the home manufacturer and to get the home market. That is, we pay $250,000,000 or $300,000,000 in order to get the home market of people who earn $240,000,000. Then where is the money going to come from? We will have to get more in actual profits than they actually earn in order to be even with the game. That is an exact fact. That was proved conclusively iby the Solicitor General in his free wheat argument, proved to the hilt. I believe that if we abolished our protection on a great many things and materially reduced it on other things we would still employ as many labourers as we do now, and would pay as good wages. President Wilson made a careful examination of the wages paid in highly protected manufac-utring industries and in those not so highly protected. He satisfied himself that in the lines where they had very little protection they paid higher wages than in those that were highly protected. I think there is no question about that. I once took occasion to look into that myself. I thought that I would get w*hat information I could as to the wages paid in Great Britain, in Prance and in Germany. As those three countries were naturally in pretty much the same position, the rate of wages, other circumstances being equal, would be about equal. I found that in free trade Great Britain the rate of wages was over 26 per cent higher than in either France or Germany. I found that in those two protectionist countries the rate of wages was practically the same, while in Great Britain it was 26 per cent higher. That bears out the contention of President Wilson that it is in the unprotected manufactures that the best wages are paid. That is quite natural because they are engaged in lines which are natural to the country. The others are not, and therefore are not able to pay such good wages.
The Solicitor General is rather troubled about the slowness of these British statesmen, who do not seem to be bright enough to know when to adopt protection or anything else. He is worried about the adverse balance of trade against them. On page 889 of Hansard, he enters into quite a wail with regard to the unfortunate position of those people in Great Britain. He laments that the balance of trade is against them, that they do not know enough to put on a protective duty, and adds:
That is the position she is in whereas, on the other hand, it is unfortunately true that her
rivals in this struggle have enormous balances of trade in their favour and have, within their own borders, every great industry brought to its highest point of perfection. That is one of the great elemental truths that has enabled Germany to maintain the struggle to this day.
Either the Solicitor General is astray in his statement, or the bluebooks which his Government publishes are seriously astray.
I find, in the last Trade and Commerce reports which are available, that Germany during the five years immediately preceding the war, imported during every year much more than she exported. I find that for those five years her imports exceeded her exports by 7,400,000,000 marks, about $1,800,000,000, or $360,000,000, a year on an average. That is protectionist Germany which my hon. friend wants to hold up as an example of a country having a trade balance in its favour.


Mr. WRIGHT:: Is that not entirely
attributable to the fact that Germany was storing up immense stores with a view of bringing on this war?


Levi Thomson: I am not so thoroughly posted in the German policy as to be able; to tell my hon. friend just how that was.
I find however, that the same thing holds good in every place I have looked for the figures for the exports of Germany at any time for the last twenty years.


William Wright: They have been working for the war that long.


Levi Thomson: I am not dealing with the question of why it should be; I am merely meeting the statement of the Solicitor General, who said that the opposite was true, whereas the Government bluebook says that this is the truth.


William Wright: So it would be under normal conditions. ,


Levi Thomson: The Solicitor General
says it is under present conditions. The same thing is true, although not to the same extent, of Austria and Bulgaria. I have not been able to find the figures of these years for Turkey. Possibly my hon. friend may find some consolation in Turkey; if so, he will be welcome to it. I may tell my hon. friend from Muskoka (Mr. Wright) that, according to the Government bluebooks, the most progressive countries in Europe have all a balance of trade against them, and had a balance of trade against them before the war.


William Wright: Name them.


Levi Thomson: I shall do so: Great
Britain, Germany, Austria-Hungary, Italy-


William Wright: The hon. gentleman
proved a moment ago to his own satisfaction that Germany was importing a great deal more for war purposes.


Levi Thomson: 
William Wright: Naturally would be if she imported a large quantity for war purposes.


Levi Thomson: 
Mr. MEIGHEN:: What I stated was that the Liverpool prices were cabled to the Winnipeg Exchange and the Winnipeg prices were fixed on that cable in the \yay that I set forth. Necessarily there are fluctuations on the grain exchange, but the price that is cabled and given out by the

grain exchange or the Grain Dealers Association, as it is called, is the price that rules throughout the day at the different buying points in the West. If my hon. friend will write Dr. McGill, secretary of the Grain Exchange, who gave me the information', he will be told exactly the same thing.


Levi Thomson: I do not question what my hon. friend says now, but I question what he said the other day.


Arthur Meighen: That is what I said the other day.


Levi Thomson: I read what you said
the other day.


Arthur Meighen: Read it again.


Levi Thomson: I read it exactly as
it appears in Hansard; I did not put in one word that the hon. gentleman did not say.


Arthur Meighen: Perhaps you did not
read it all.


Levi Thomson: I did read it all, so
far as was necessary tp my argument. If there were fluctuations of lli
11 p.m. cents, that shows that there are bids which are not placed on the Liverpool markets and that the rule which my hon. friend has laid down is not good. This is an erratic world, and I think one of the most erratic things in it is the grain market. It is difficult to say how the grain market will go.


Arthur Meighen: Does the hon. gentleman still say that there is not a balance of trade in favour of Germany?


Levi Thomson: According to the Government blue-bo;oks there is a balance of trade against them.


Arthur Meighen: You quoted what it was, not what it is.


Levi Thomson: I do not know what
Germany is doing now; I suppose she is doing what the British fleet lets her do.


Arthur Meighen: 
Levi Thomson: I object to my hon.
friend's making a speech in the middle of my remarks.


Arthur Meighen: My hon. friend challenged me a moment ago; perhaps he will let me answer him now.


Mr. SPEAKER:: Order.


Levi Thomson: I think that my hon.
friend is rather infringing on his privileges; he is making another speech. I quoted the remarks of my hon. friend, word for word, I showed that he was absolutely wrong, and he dares not deny it.


Arthur Meighen: I wish to deny it now, but you will not let me. I want to show you where you are wrong.


Levi Thomson: I will read my hon.
friend's words again.


Arthur Meighen: The hon. gentleman
will not let me deny it.


Levi Thomson: I will let you deny it, but I do not want you to make a speech. This is the second time that the hon. gentleman has attempted to make a speech in the middle of my remarks, and I do not propose to allow it. The hon. gentleman said, in speaking of the balance of trade:
It is unfortunately true that her rivals in this struggle have enormous balances of trade in their favour, and have, within their own borders-
And so on. Now what balance of trade Germany has in her favour since the war began I do not think my hon. friend knows; I do not, because we cannot know exactly what is going on in that country, as Germany is not giving out any such information. I have quoted up to the time of the war, and in all these years the balance of trade was against Germany.


Arthur Meighen: She was gaining very rapidly.


Levi Thomson: It is true that in the last years she had not been gaining very rapidly. For one year before the war she had made a big jump. I have looked up the figures for the last ten or fifteen years, and I have found that the average is about the same as it was during those five years, a little less, I think, so that she has not been gaining. She may have gained in one year, but you cannot prove'things by one quotation. One swallow does not make a summer, although, if my hon. friend so desired, he could prove to his own satisfaction that one swallow made half a dozen summers.
I was dealing with the question of free wheat and of my hon. friend's proof of the statement that we were getting no benefit on the higher grades of wheat. He claims

to prove that by the conditions of the market for one day. I have read a great many opinions of experts in the grain trade, hundreds of which opinions are quoted in the newspapers, and I do not remember seeing a single one that claimed for a moment that the market quotations of the day cited by my hon. friend prove anything, although he says that they prove everything; that they settle the whole question. I submit it does not; the mere fact that there were certain spreads on one day proves nothing. I might just as well claim that because the prices are to-day from 40 to 50 cents a bushel higher than they were at the time the Order in Council was passed, therefore the prices have advanced on account of wheat being put on the free list. The experts do not contend for a moment that the quotations of that day prove anything. Mr. James Car-ruthers, in the Financial Post of the 28th of April, speaking of free wheat, says:
I believe it will prove a great benefit to our farmers. Free wheat will contribute to the prosperity of the western farmer, and consequently to his contentment.
I fancy, if I am not mistaken, that Mr. Carruthers was an expert in grain matters when my hon. friend was running around in pantaloons, although ,my hon. friend thinks that he knows more than Mr. *Carruthers about this .subject. I quote from the Nor-West Farmer of the 20th of April:
Regarding- the permanent benefits of the removal of the duty on wheat, only time can actually determine.
My hon. friend, however, thinks he can determine it from one day's quotations.
_ It will mean much to the western farmers; it will give them this great southern market at their very door, which will be utilized whenever it is advantageous to do so. This will be a permanent advantage.
My hon. friend says it is at present advantageous for him to have free wheat on account of the low grades of wheat, and I grant he is right; but it is advantageous for him to have it at all times, because of the fact that our highest grade of wheat, which is better than anything the American farmer produces, is wanted at all times by the Minneapolis miller for mixing purposes, and he is always willing to pay a little extra price for it, so if we always have that market we shall always get that benefit. I do not purpose saying anything further about this Order in Council or Statute. I tried to secure a little information from my hon. friend when

he was speaking, when he claimed that the Order in Council wa3 in exactly the same position as a statute. I asked him if the Order in Council could not be repealed at any momnt by another Order in Council, and he admitted that it could. I am not sure whether he meant by the further answer that he made, to leave the impression that if a statute were passed, it could also be repealed by an Order in Council. My hon. friend may be a little rash sometimes and so may his Government, but they would hardly -be so rash as to repeal, by an Order in Council, an Act passed by this House shortly before. I am not, however, going to enter into a discussion as to whether or not an Act of Parliament passed in this way could be repealed by an Order in Council.


Mr. McKENZIE:: It certainly could not
be repealed unless the statute itself provided for that being done.


Levi Thomson: I am not going to
enter into a discussion of the effect of this Order in Council when the war is ended. Personally, I believe my hon. friend from St. John (Mr. Pugsley) is right so far as I have been able to follow his argument. I am very glad that the Government have gone so far as they have in the matter of free wheat, although I am very sorry for the way in which we were given free wheat, and I am very sorry that they should have waited until a moment when the placing of wheat on the free list would do the least good, although I am not saying this in a complaining way. Some statements have been made in this House as to the proportion of wheat still in the farmers' hands at the time the Order in Council was passed. The proportion of wheat was very small; but the proportion of low grade wheat is very much smaller, for this reason. The parts of the country in which there were the poorer grades had very light crops, and consequently the farmers did not take long to thresh the grain, and as they needed the money, they marketed those low grades quickly. I believe, therefore, the greater proportion of that grain was marketed and that a very small proportion of it is left in the farmers' hands. The great benefit from free wheat has gone, for this year at least, to the speculator and the miller, and hardly any of it to the farmer. Although I know a few farmers in my constituency who are still holding wheat, I do not know of one who is holding the low grade of wheat.


Francis Ramsey Lalor: I think the Government crop reports would lead one to suppose

there is quite a large amount of wheat still in the farmers' hands. I am not saying this as a matter of criticism, but just as a matter of information. Does my hon. friend think that statement is not correct?


Levi Thomson: From what I know,
there is a very small proportion of wheat in the farmers' hands now. Although the bulk may be considerable, it is a very small proportion of the crop. It must be remembered that the official reports to which my hon. friend refers were made some time ago, and that the wheat is continually and rapidly going out of the farmers' hands, because in the latter part of the winter most of the grain is rushed off. The farmers must market it before the sleighing is over, because after that they have no opportunity until after the seeding is done, and then they are busy ploughing. It is a rash thing for a farmer to hold grain over unless he has an elevator. Some of them are holding grain in elevators, but that is a very small proportion of the crop, and so far as the low grades of wheat are concerned, there is practically none now in the farmers^ hands, so that whatever benefit is derived must be derived entirely by the speculators and practically none by the farmers. I think the Solicitor General will bear me out in that.


Arthur Meighen: Not yet.


Levi Thomson: I tried to draw out the Minister of Finance this evening, but evidently he does not want to be drawn. We have heard, however, what the Solicitor General has to say; it was pretty carefully worded, and it might mean almost anything or nothing. We have also heard what the hon. member for Chateauguay (Mr. Morris) has to say. He was very outspoken; I aim afraid he blurted the truth right out. He accused us of being untruthful. I could not accuse him of that, because I think he told ue the plain truth. This is purely an emergency measure, and the moment it suits the Government they will rescind it.
If the free wheat policy is to be of benefit only in the case of lower grades of wheat, what will happen if we have a good crop this year? Last year our crop was very poor on account of the rust, but this year we may have a good one, plump grain, I hope, like we had in 1915. What would happen in that case? If the Government are thoroughly sincere, and I would not like to accuse them of being insincere, why then at the beginning of next season they will
rescind the order; they must, if their reasoning is sound.


Francis Ramsey Lalor: You have the positive statement of the Minister of Finance that he will not do that.


Levi Thomson: I was not in the House when the Minister of Finance made that positive statement, and I have tried to draw him out this evening but he will not be drawn. There have been eo many interpretations of that positive statement of his, that I do not know what it means. I am told that it was merely a statement that the Order in Council would not be rescinded except on authority from this House.


William Thomas White: If my hon. friend will read Hansard to-morrow, he will see that he has not correctly quoted me.


Levi Thomson: In the meantime, we
have the positive statement of hon. gentlemen opposite that it is an emergency measure, and we have the rather roundabout statement of the Solicitor General from which the only reasonable inference is that the Order in Council will be repealed when it is no longer required, and it will be no longer required if we have no low grade wheat this year. I hope we will have none, but I do not want to see this Order repealed.
On motion of Mr. Bou.lay, the debate was adjourned.
On the motion of Sir Thomas White, the House adjourned at 11.20 p.m.
Wednesday, May 2, 1917.