1925-03-03

COMMITTEE ON RAILWAYS, CANALS AND TELEGRAPH LINES

[Stage Direction]
Right Hon. W. L. MACKENZIE KING
(Prime Minister) moved:	That the names
of Messrs. Pouliot and Delisle be subsituted for those of Messrs. Beland and Euler on the select standing committee on Railways, Canals and1 Telegraph Lines.
Motion agreed to.

Hon. J. A. ROBB (Acting Minister of Finance) moved:: That the Auditor General's report for the year ending March 31, 1924, and the Public Accounts of Canada for the year ending March 31, 1924, be referred to the select standing committee on Public Accounts.


[Stage Direction]
Motion agreed to.

Right Hon. W. L. MACKENZIE KING (Prime Minister) moved:: Resolved by the	House of Commons,-That
it is expedient that parliament do approve of the treaty for the suppression of smuggling operations along the international boundary between the Dominion of Canada and the United States, and assisting in the arrest and prosecution of persons violating the narcotic laws of either government and for kindred purposes, which was signed at Washington on the sixth day of June, one thousand nine hundred and twenty-four, and which was signed on behalf of His Majesty in respect of Canada by the plenipotentiary therein named, and that this House do approve of the same.
He said:	Mr. Speaker, the resolution is
to secure from the House of Commons, and subsequently from the Senate, of Canada approval of a treaty in the nature of international co-operation which has been entered into between Canada and the United States for the suppression of smuggling across the international boundary, and also to assist in the arrest and prosecution of persons violating the narcotic laws of either government.
This treaty has been negotiated and signed in accordance with the procedure laid down at the Imperial Conference of 1923. Hon. members of the House may recall that in the fall of 1923 a conference was held here at
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Ottawa between officials of the United States government and officials of the Canadian government who have to do with the administration of the customs and excise laws of the two countries. It was felt that if a conference could be held at which the officials of the two countries might be brought into immediate and personal touch with each other, it might be possible to draft regulations, subsequently to be embodied in a treaty, which would be helpful to both the United States and Canada in the suppression of smuggling into either country. As I have mentioned, the officials of the United States government came to Ottawa for the purpose of conferring with our officials here. As a result of that conference a report was presented to the governments of the two countries, which subsequently became a matter of further negotiation between ministers of the two governments, and a treaty was drafted. It was signed at Washington on June 6th of last year, signed on behalf of the United States by Mr. Secretary Hughes, and on behalf of Canada by the hon. Minister of Justice (Mr. Lapointe) who received from His Majesty the King full powers enabling him in respect of Canada to sign on His Majesty's behalf. The treaty, so far as the United States is concerned, was_ submitted to the United States Senate for advice and consent of ratification last year, and the advice and consent of ratification on behalf of the Senate was obtained on December 12, 1924. What the government is seeking at the moment is approval by this House of the treaty as a preliminary to ratification on the part of Canada. When ratification by Canada has been obtained exchange of ratifications between the two countries will be made and the treaty will then become law.
The provisions of the treaty relate in the first place, to the exchange of information between the officials of the two governments with respect to clearances of vessels, or the transportation of cargoes, shipments or loads of dutiable articles across the international boundary. The treaty provides that where the officials of the United States government or of the Canadian government request the officials of the other country for information with respect to such clearances of vessels, transportation of shipments of articles across the international frontier, that information shall be given.
It provides further that where there is reason to believe in respect to clearances of vessels to any ports smuggling is about to take place wfith respect of any articles which are prohibited entry into either of the countries, the officers of the country from which 
these articles are about to be exported shall give information to the officers of the other country to assist in preventing these smuggling operations.
A further clause provides that where it appears, from the size or tonnage or general character of any vessel about to clear from a port either of the United States or Canada to some port named that it would be impossible for the vessel to reach the destination named, clearance shall be denied by the custom officers to any such vessel if carrying cargo consisting of articles the importation of which into the territory of Canada or of the United States is prohibited. I may say that this is a restriction which our Department of Customs is now enforcing as a departmental regulation. This treaty if it pases, will make the regulation a matter of international obligation.
There is a similar clause in the treaty with respect to the names and activities of persons known or suspected to be engaged in violation of the narcotic laws of Canada or the United States, the underlying idea being that the officials of both countries are interested in doing all they can to suppress the narcotic evil; it is therefore provided that they shall co-operate and assist one another by exchanging information wherever they have reason to believe that an effort is being made to violate the narcotic laws of either country.
There, is a Clause in the treaty which provides for the return to the owners in either country of property that has been stolen and taken across the border and there seized by customs officials of the other country. It has happened very often of late that articles, automobiles especially, have been stolen in one country and taken across the border to the other, in order that the offenders may the more readily escape punishment, and often to permit of the disposal of the article on the other side. It has been found in some cases that the owners of the articles have suffered in consequence through there not being an adequate requirement under which the stolen article shall be returned to its owner. The provision in the treaty will assist bona fide owners to recover stolen property in circumstances of the kind.


Mr. MEIGHEN:: What has been the practice in the past?


William Lyon Mackenzie King: I understand
that in the past effort has been made to secure restoration, but that the matter has frequently necessitated considerable negotiation; there has been difficulty in a number of cases in effecting a speedy restoration of stolen goods.

Canada-U.S. Smuggling Treaty
I am informed by the Minister of Justice that there has been in force during the last few months a departmental regulation covering the matter. I presume it is along the lines of the provision of the treaty in that regard.
There is also a provision in the treaty which will facilitate the giving of evidence in the courts of the other country of the customs and other administrative officials of either country who may have knowledge of violation of the law respecting smuggling or narcotics; the treaty provides they shall upon request be directed to attend as witnesses in civil or criminal cases. In other words Canadian customs officials may give evidence in United States courts, and shall give evidence in those courts if requested by the government of that country, the payment of their expenses devolving in such a case upon the government of the United States. Similarly our officials or departments will have the right to ask officials of the United States government to come into our courts to produce documents and give evidence with respect to matters of which they may have knowledge and which our officials may desire to have investigated in our own courts.
There is a provision also with respect to the conveyance of prisoners, wreckage and salvage where offences have been committed against the narcotic laws of the respective governments. There is also a provision which admits of the importation into the Yukon, through American territory, of liquor that is being legally imported under Yukon regulations or laws. The provision in that regard is simply to provide as respects importations into the Yukon the same rights of transit across American territory in the vicinity of the Yukon as is given with respect to the transit of alcoholic liquors through the Panama canal or on the Panama railroad.
The treaty is to be in force for one year and thereafter subject to thirty days' notice. It will come into force ten days after ratification.


Arthur Meighen: I am not clear as to one thing, that is as to the restriction on the shipment of goods by vessel. I understood the Prime Minister to say that when a vessel was clearing, if it appeared that the destination, having regard to the size of the vessel, was so far away that she could not reach that port within the time specified clearance would be denied.


William Lyon Mackenzie King: Yes, that is
right, not likely to be able to reach the port.


Arthur Meighen: I was not aware, in the
case of the departure of a vessel, that the time was fixed as to when it was to arrive at its destination.


William Lyon Mackenzie King: I might read to my right hon. friend the section of the treaty which covers the point he has raised.


Arthur Meighen: Which one please?


William Lyon Mackenzie King: The high contracting parties agree that clearance from Canada or from the United States shall be denied to any vessel carrying cargo consisting of articles the importation of which into the territory of Canada or the United States, as the case may be, is prohibited, when it is evident from the tonnage, size and general character of the vessel, or the length of the voyage and the perils or conditions of navigation attendant upon it, that the vessel will be unable to carry its cargo to the destination proposed in the application for Clearance.


Mr. WOODSWORTH:: Has that been
carried out by departmental regulation for some time?


William Lyon Mackenzie King: I understand
the departmental regulation has been with respect to furnishing information to the officials of the United States government by our government where there was reason to suspect that the owner of a vessel was intending to smuggle prohibited articles into the United States.


James Shaver Woodsworth: That has been done in such a place as Windsor?


William Lyon Mackenzie King: Yes.


Arthur Meighen: Belle River?


Mr. BLACK (Yukon):: Is this the same
treaty concerning which a resolution was on the order paper last session and was withdrawn because the United States Senate adjourned without ratifying it?


William Lyon Mackenzie King: Yes. My hon. friend is right.


Arthur Meighen: I understand that under the rules the House does not go into committee to consider the resolution in detail. I do not know just under what provision-


Mr. McMASTER:: I rise to a point of order. I wish we had a rule in this House which would make the leaders of parties speak in audible terms.


Arthur Meighen: Among other qualifications of my hon. friend he would be quite up to the mark on that score. Under the rules, I am informed, there is no provision by
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which this resolution can be considered in committee in detail. If that is correct I very much regret the fact. I recall that the ratification by parliament of the French and Italian treaties in some way was considered in committee in detail.


Mr. LAPOINTE:: Because, apart from the approval of the treaty, legislation was needed.


Arthur Meighen: Yes, that is right. The explanation is no doubt correct. But misfortune, though, is still apparent because we cannot consider and question details of this treaty in a formal debate in the House. I say this not because I have in mind any rigorous criticism of the treaty itself. The purposes the treaty has in mind I quite approve of, and I have no doubt every hon. member of the House does as well. Smuggling of recent times has become not only a fine art but a very remunerative and widely extended occupation-one of the most successful, one of the few prosperous occupations of the present time in this country. The dimensions which smuggling has reached, according to the views of those who should know best, are really appalling. I regret that the Minister of Customs and Excise (Mr. Bureau) is not in his seat, as I would like to question him as to his view on this subject.


William Lyon Mackenzie King: I think my right hon. friend is aware that the Minister of Customs and Excise (Mr. Bureau) has not been well for some time past, and unfortunately this afternoon is indisposed.


Arthur Meighen: I am not intimating that he is away because the treaty is before the House, but I should like to have some information as to the correctness of data furnished by various associations and especially by one, as to the extent to which the smuggling is now carried on. As respects ourselves, it presents a problem much wider than it presents as respects the other contracting party, the United States. I do not presume that country is very much troubled with the smuggling evil, except in respect of narcotics and intoxicating liquors. The treaty, from their point of view, is doubtless framed with a view to meeting the troubles they have encountered in enforcing the Volstead Act. But for ourselves the field to be covered is much vaster. Smuggling into Canada extends from liquors to tobaccos, from tobaccos to cottons, and from cottons to woollens, silks, and all specially valuable articles easily procurable across the border. Consequently the terms of the treaty have very special interest to this

country. Many of our laws will be rendered nugatory if smuggling is to be carried on to anything comparable to the degree presented by this association. I am rather disappointed in the terms of the treaty, not that I object to any of them, but they do not seem to me to go any further than what has been, or certainly should have been, the practice of both governments up to the present time. The treaty provides that mutual information shall be furnished by the contracting parties. I think the Prime Minister says that this has been the practice of recent months. Undoubtedly, even without a treaty, it should be the practice at all times and should have been the practice for years departmentally between the governments. I do not object, and there can be no objection appealing to my mind, to this common practice having the sanction of a treaty-resting upon that more secure foundation of making it obligatory upon all parties hereafter. The same provisions seem to be in force with respect to the transfer of liquor. But there is one that may or may not be effective. I refer to the one as to which I questioned the Prime Minister specially-that which is provided in article 2. It seems to me that article . would have been better had it made it obligatory upon the party applying for clearance that the period within which the boat should arrive at destination should be stated. All the article now provides is that if it appears to the customs authorities, say of Canada, that any boat sailing from our shores applying for clearance is not likely, because of its size and the distance to be traversed, to reach its destination within the period stated in the application, then clearance may be denied. It may be one of the regulations of the department that within the application there shall be a stated period, but the department would still be at liberty, so far as this treaty is concerned, to abandon that phase of the regulations. Simply by doing so article 2 would be rendered nugatory. I have not much faith, from what information I have received, in the officers of the Customs department of this country exercising any particularly scrupulous srutiny over clearance papers prior to departure. There have been certain notifications from the department which go to show they have a very wholesome view of exportations from Canada, no matter what the article or destination. The other provision with reference to the return of stolen property is of course an obviously correct one. I have had complaints as to property shipped from the United States to Canada being stolen and not being recover-

Canada-ZJ.S. Smuggling Treaty
able, but it always seemed to me very hard to understand why it would be difficult, once the real owner was discovered, to see to it that some means was provided whereby he could at least come to this country and get his property. The provision as to the interchange of witnesses seems to me a practical and useful one. That is to my mind the principal provision of this treaty. The rest in the main merely covers what is obvious, and what has been, or at least should have been, the practice all along; but the officers of either government would not be compellable to testify in the other country, unless provision was made therefor. The making of this provision should render more easy the establishment of the offence in whichever country committed. All that can be done is to wish well of the treaty and to remark that its efficacy depends to the extent of ninety-nine per cent upon the earnestness and determination of the government and its officers.


Ernest Lapointe: As far as the several sections of the treaty are concerned, it may be that they might go further, some of them could go further, as suggested by my right hon. friend; but I would call attention to the fact that this treaty is based largely upon an understanding reached in Ottawa two years ago by the officers of both governments, andl all its provisions were then discussed and fully considered, and the result is what the officers thought best for both countries to agree upon. As far as the evil of smuggling is concerned, I agree with my right hon. friend (Mr. Meighen) that it is a most serious evil and that every means should be adopted tending to check it most effectively, and I may say that in that regard the government has decided to deal with the matter in a special way this session by means of legislation and otherwise.


Hon. H. S. BELAND (Minister of Soldiers' Civil Re-establishment and Health):: I think
that the right hon. Prime Minister (Mr. Mackenzie King) has very fully explained the provisions of the different clauses of the treaty. I also regret that under the rules of the House we are not permitted' to go into committee of the Whole, where it would be possible for every hon. member to ask questions and receive answers, but I will content myself at the present time by saying that those who desire the suppression of the narcotic evil in Canada-and for that matter all over the world-will hail with deep satisfaction the new agreement that has been
arrived at between Canada and the United States. So far as we are concerned, our narcotic laws are very drastic and very stringent, and inasmuch as Canada does not produce opium or coca-leaves, and furthermore does not manufacture the derivatives of these two raw products opium and coca-leaves, the problem would be very much simplified if we were not deluged with clandestine importations. The treaty which is now submitted to the House for ratification provides for compelling witnesses from either country to attend in the other for the purpose of giving evidence in cases brought before the courts. The treaty also provides for the extradition of persons who may be under bail or convicted under the laws of either country. This will be a great help to us. The House is aware that numberless difficulties confront the Department of Health and also the Department of Justice in administering the act as it stands. It is well known that alkaloids, so-called, or, to use ordinary language, derivatives of opium and coca-leaves, are transported in very small volume, which circumstance makes smuggling all the easier. Another feature of this illicit traffic is that it is rewarded by very large profits.
There are three classes of men with whom we have to deal. We have to deal with the addicts. The House will agree with me that we should regard this particular class with some sympathy. In many quarters they are held to be diseased persons rather than criminals. There is another class, which is not the worst, but which is not to be put in the same class as the addicts. These are the small trafficking people, the deck peddlers, the men who are engaged for a very small remuneration to peddle the powders on street comers, in houses, public places and so on. This class we endeavour to check and to punish as they deserve to be punished. But the class .towards which we should turn our attention is made up of ringleaders as we call them, large traffickers, men generally wealthy or in very comfortable circumstances. Under the tows as they exist between Canada and the United States, it is possible for a man of this importance, when he surpects that the Department of Justice, through the mounted police is getting too active towards himself, to cross over the border and thus be immune as far as he is concerned. Should he, through some channel, realize that, for instance, he is going to be punished within a week or two, his means enable him to move immediately across the border. Such a man may conceal himself beyond our power of dealing with him.
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That is the case of a man who is suspected, a man who has 'been the subject of close and *persistent investigation for a number of weeks, sometimes for a number of months. Let us go one step further and take the case of a man who has been arrested and who is out on bail. Nothing prevents this man from crossing over the border into the United States and thus relieving himself from any anxiety of action being taken against him under our law. Further, let us take the case of a person who has been convicted under our laws and who appeals against the decision of the court of first instance. He is allowed out on bail. Again, we have a man who has been convicted of carrying on illicit traffic and who can pass over the border and so escape the punishment which he deserves. The treaty as it is now submitted provides for power of extradition of such parties. I am informed by the officials of the Health department that no less than ten or twelve cases have happened during the course of the last twelve months between Canada and the United States, and as regards the United States, we know of three cases where the suspected person, the convicted person, has disappeared from their territory and is probably located' in Canada. The department has been supplied with photographs and descriptions of those 'persons, and were it possible for us to locate them in Canada, we would be absolutely powerless inasmuch as to-day our law does not provide for extradition.
There has been between United States and Canada in this connection very close cooperation. Since I have been at the head of the Health department, I think Canada can congratulate herself on the fact that the closest co-operation has existed between the inland revenue service of the United States and this department. Last year, to exemplify what I have just stated, at our request the United States authorities seized a shipment of 100,000 ounces of coca-leaves which had been landed in New York and had as its destination a fictitious firm in Montreal. What was contemplated by the ringleaders in the United States was, during the progress of this train from New York to Montreal on the American side of the border, to empty the car containing that consignment. The United States were requested to deal with this consignment and they did so in a perfectly satisfactory manner.
Now, I do not think I should prolong this explanation, inasmuch as later on, I .presume, when the estimates of the Department of Health are under consideration, it will be my privilege to explain to the House the various 
discussions and negotiations that took place in Geneva during the last opium conference. I may say this much, however, that it is expected that the new convention will prove a step in advance over the convention of 1912 which was decided upon at the Hague. The explanation I had intended giving to the House will have to be postponed in view of the fact that the convention as it was signed early in February has not yet reached me. So far as this treaty is concerned, however, I want to say emphatically that our task will not be made any less arduous but will be rendered the more effective of execution by reason of the fact that we shall be in a position to deal with those powerful traffickers who up to the present time have been mocking at the governments both of the United States and of Canada.


Mr. HANSON:: The first paragraph of the treaty provides that customs and other officials of the respective governments of Canada and the United States shall upon request be directed to attend as witnesses, and so on. Upon whose request are they to attend? Will it be the request of the respective governments? Will these officials, some of whom may be resident in the country of which they are not nationals,-say the immigration officials of the United States resident in Canada -be answerable on a subpoena? I may say to the Minister of Justice (Mr. Lapointe) that at the present time United States immigration officials resident in Canada, while they will answer a subpoena, refuse to give any evidence which they may have collected in the course of their official duties.


Ernest Lapointe: The request, no doubt,
will have to be made by the accredited representatives of either government, and in the usual manner.
Hon. GEORGE P. GRAHAM (Minister of Railways and Canals):	In the absence of
the Minister of Customs (Mr. Bureau), who unfortunately is ill, I may be permitted to say a word or two. I know that the press has been rather misconstruing a remark which the Minister of Customs made recently in the House in reference to the difficulty of altogether eliminating smuggling. What he had in mind undoubtedly was that in this matter, as in the case of sin, the elimination of the evil cannot be altogether accomplished in this world, although it can be suppressed and reduced to a minimum. This much must be admitted, however, that in recent years smuggling has apparently got to be a science. Whether it be that prohibitions are too strong for human frailty and the desire has conse-

Canada- V.S. Smuggling Treaty
quently been cultivated to break all laws in sight, lam not prepared to say; but this does seem to be the case, that the smugglers both ways have got to understand the rule of transportation, that in order to obtain cheap rates you must have a return cargo. When they take spirituous liquors one way they are inclined to carry silks back, and so they make a double profit. The Minister of Customs is very much alive to this situation, and' he informs me that he is going to ask this House to give him the right, without referring to the Civil Service Commission, to select a number of men specially fitted for this particular work of prevention in the smuggling practice. I do not think that there will be any question about conceding him that right to appoint men of a certain stamp who are specially qualified to suppress this evil. The evil is mot only a moral excrescence but it is also a source of financial loss to the country, and the minister should be permitted to select a number of men, large or small as he sees fit, who, he thinks, have special qualifications for this particular work.


Mr. LEWIS:: Can you not get those men through the Civil Service Commission?


Mr. GRAHAM:: They are so obtained now.


Arthur John Lewis: Well, is it not possible to get them in the same way in the future?


George Perry Graham: I say no, most emphatically. It seems to me you might as well go to the Civil Service Commission for a clergyman.


Arthur Meighen: May I inform the minister that that is done under the act?


George Perry Graham: I shall proceed with the remarks I was going to make.
The government is seriously considering the advisability of bringing in more stringent legislation for the prevention of smuggling. I take it that it would be harsh if the man or woman who smuggled small articles-and nearly all of you do-were to be prosecuted criminally. On the other hand, there seems, no great reason why men or women who deliberately violate the law to the financial loss of their fellow taxpayers and for their own profit should not be prosecuted to the full extent. I will not dwell further on the evils of smuggling, but I would point out that the practice has got to such a stage that a very stringent remedy will have to be applied if it is to be curtailed, as it ought to be curtailed.


Mr. JACOBS:: Why not have free trade altogether?


George Perry Graham: Well, if we could get free trade altogether it would do; but that is impossible in this world. There is something else besides silks that comes over here, and it may surprise some of our people to learn this. While we are continually talking about spirituous liquors being exported to the United States, there is a large quantity coming into Canada from that country at the present time, mostly in the form of alcohol. Although perhaps on the Detroit river and in that vicinity there is not much reciprocity in the imports and exports of liquor, in one or two other parts of Canada there are coming in to-day large quantities of alcohol. This alcohol I know was recently tested and was found good in every respect, and it was placed in the stores of men in the big cities, merchants who are permitted by law to sell alcohol, and they can sell this at a price less than half what they would have to pay for the same alcohol if they purchased it legally in Canada.
Something else that calls for a remedy is the considerable traffic which is taking place illegally in the whiskey business between Canada and the United States. In 1922, at the request of the provinces, this parliament enacted an amendment to the Canada Temperance Act by which on the request of the provinces, through order in council, certain authority vested in the federal parliament was to be handed over to the provinces. Through this authority the control of the export of liquor can be put into practical effect by the provinces themselves. But to my mind there has been something lacking up to the present time to give that legislation full effect, and we hope the deficiency will be supplied by this treaty. Therefore, if the provinces interested would take advantage of the legislation of 1922, with the power therein conferred supplemented by the provisions of this treaty, they could, I believe, bring about a far better state of affairs in the border localities between Canada and the United States. We are hoping that this improvement will be brought about, because I am free to say that at present there are towns in Ontario which, although the people from the town council down hold strong temperance views, are being made ports of export for whiskey manufactured legally, but peddled illegally. If this result is accomplished, then I say the treaty will be worth while.



Canada-U.S. Smuggling Treaty


Mr. L. J. LADNER (Vancouver South):: Does the treaty better ensure the payment of excise duties in any way? It is common knowledge in British Columbia that large shipments of liquor take place presumably to Mexico or South America, but after being taken out into the gulf a short distance they are brought back into Vancouver or tihe adjoining districts and are sold at much lower prices than those charged by the provincial government. This is said to be due to the excise duties being evaded in the bonded warehouses under present arrangements.


George Perry Graham: Under this treaty the officers are given power to refuse clearance if in their judgment the vessels are not of sufficient capacity or are not intended to land their cargoes at the port for which they clear.


Leon Johnson Ladner: Why could not the excise
duty be assessed and the exporters be given a refund upon evidence of delivery of their cargoes at the ports for which they were given clearance? That would certainly ensure the government getting the duty.


George Perry Graham: I do not think that is in the treaty.


Mr. JOHN MORRISON (Weybum):: The Minister of Railways (Mr. Graham), in speaking for the Minister of Customs (Mr. Bureau) stated that his colleague was going to ask for the privilege of going over the head of the Civil Service Commission in order to secure a competent staff to better enforce the laws against smuggling. I do not think he paid much of a compliment to the civil service. In my opinion something should be done to improve the standard-


George Perry Graham: Might I interject that the suggestion comes largely from the Manufacturers' Association. They are very deeply interested in the prevention of smuggling.


John Morrison: Well, I am going to
offer a suggestion also. I would suggest that in the examinations for the civil service applicants should be examined as to their integrity as well as their ability to pass written examinations.


William Lyon Mackenzie King: How will the
hon. member examine any man as to his integrity?


John Morrison: If the Prime Minister
will answer my question he will find the answer to his own. If the Prime Minister were at the head of a big business concern, would he tell the House that he would not

examine into the integrity of any applicant for a position of responsibility? Certainly he would.


William Lyon Mackenzie King: By written
examination?


John Morrison: You would go about it in the same way as the head of any business concern.


William Lyon Mackenzie King: I would remind the hon. member that the Civil Service Commission advertise vacancies, hold written examinations and make appointments. How, under such a system, could the commission test a man's integrity?


John Morrison: The Civil Service Commission examinations do not go far enough. Men get into the civil service who are absolutely unfitted for the work they 4 p.m. have to do and are a menace both to the service, and to the public, but once they get in it is impossible to get them out. The minister's statement proves that there are inefficients in the service. No member likes to get up and cite a case near home, but we know of men who could not get a job with a good firm who get into the civil service, and then no power in Canada can get them out. They should be investigated as to their integrity, the same as any business concern would investigate them, and if they had not a good clean record they should not be considered for a moment.


James Shaver Woodsworth: Mr. Speaker, with
respect to the enforcement of the law against smuggling, when we were discussing the Royal Canadian Mounted Police a couple of sessions ago it was said that we needed this body to enforce the laws of the Dominion. Do I understand that they are not fitted for doing this kind of work?


Some hon. MEMBERS:: Carried.


Mr. SPEAKER:: Is it the pleasure of the House to adopt the motion?


James Shaver Woodsworth: May I have an
answer as to whether the Royal Canadian Mounted Police is to be reinforced by still another police force?


Hewitt Bostock: I might remind the hon. member and the House that we are not in committee of the Whole, and consequently no one except the mover may speak twice on the motion. By unanimous consent of the House I am willing to let the minister answer, but questions are being put by hon.

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members which, strictly speaking, are not according to the rules.


Mr. W. G. McQUARRIE (New Westminster) :: Mr. Speaker, I do not see how it is possible to stop smuggling if we leave our doors open at night. That is actually the case in some parts of the Dominion. According to my latest information, that statement is correct in respect of British Columbia. On the Pacific highway and on other roads in my constituency leading to the United States, on which the principal traffic between the two countries takes place, the customs officers both of Canada and the United1 States are not on duty after one o'clock in the morning. Neither government provides a sufficient staff to attend to the business. Now, perhaps the man who goes in for smuggling should do so in the day time, but usually he does not, his favourite time is at night, and there is nothing in the world to prevent him from smuggling as much as he likes along those roads in the night-time. If my information is correct, there is something wrong with the administration. If you want to stop smuggling you will have to have a staff on duty at night as well as in the day time, because smugglers are active at night. Now what is wrong with the administration if the statements I am making are true, and I think they are? Why cannot this government and the government of the United States do business in a businesslike way, and put on sufficient staffs to prevent smuggling along the principal roads in any event?


George Black: Canada-VjS. Smuggling Treaty
In regard to the remarks that have been made in connection with the Royal Canadian Mounted Police and the part they have played in the prevention of smuggling and the violation of law generally, I do not think that the discussion of this treaty should have been made the opportunity for an unnecessary slam on the Royal Canadian Mounted Police, because I think that body does not need apologists either here or elsewhere. I think prdbably that if the Royal Canadian Mounted Police were given more authority and a little freer band in enforcing the laws of this country, the laws not only with respect to smuggling but as to crime generally would be much more efficiently enforced. I have no doubt that their services will be called into use in many instances in enforcing the various sections of this treaty.
Before I sit down, I would again call the government's attention very seriously to the restriction I have mentioned contained in Article VII. Although most of the goods come in over the White Pass and Yukon railway, there are other means of transportation.


Ernest Lapointe: In reply to my right
hon. friend-


Hewitt Bostock: Of course, the hon. gentleman can only speak again by unanimous consent.


Ernest Lapointe: My right hon. friend has referred to the fact that two years ago there was submitted to this House a treaty between Great Britain and the United States concerning the liquor traffic, and he says that at that time we should have inserted such a provision as is now contained in Article VII of the present treaty. That treaty, as my hon. friend knows, was negotiated by Great Britain. It was submitted to this parliament for our approval, and we did approve it. We had to approve it in the form in which it was, or otherwise we would have had to negotiate a separate treaty by ourselves including such a provision as Article VII of the present treaty contains.
My hon. friend also says that we should not confine ourselves in this treaty to the specific means of transportation mentioned in Article VII. Well, as a matter of fact, Canada claims that we have the right to transport liquor over the Yukon river; but this right is denied by the United States. However, the means of transportation which is mentioned in Article VII is really the best means so far as Canada is concerned, as I understand, and that is what Canada has been asking from the United States. My hon.

friend knows, however, that if we have the right to use the Yukon river, we still have it even after this treaty has been negotiated. Section 7 of the treaty gives us an additional right, but does not remove at all any right we may have had before, to use the Yukon river.


[Stage Direction]
Motion agreed to.
William Lyon Mackenzie King: That a message be sent to the Senate informing their honours that this House has adopted the above resolution and requesting that their honours will unite with this House in the approval of the above mentioned treaty, and that the Clerk do carry said message to the Senate.


[Stage Direction]
Motion agreed to.


William Lyon Mackenzie King: Resolved by the	House of Commons,-That
it is expedient that parliament do approve of the convention between His Majesty and the President of the United States of America for the purpose of enlarging the list of crimes on account of which extradition may be granted with regard to certain offences committed in the United States or in the Dominion of Canada under the convention concluded between Great Britain and the United States on the 12th July, 1889, and the 13th December, 1900, and the 12th April, 1905, and the 15th May, 1922, which was signed at Washington on the eighth day of January, one thousand nine hundred and twenty-five, and which was signed on behalf of His Majesty in respect of Canada by the Plenipotentiary therein named, and that this House do approve of the same.
He said:	The resolution itself gives the
House practically all the information, it will, I think, wish to have -with respect to this particular treaty. The treaty or convention arises, in a way, out of the one which has just been approved by the House, and makes special provision for the extradition of persons from one country to the other who have violated the narcotic laws of either country. In international law there is no obligation upon a country except by treaty, to surrender persons who have violated the laws of another country, and while, up to the present time, there has been an extradition treaty between Great Britain and the United States, which includes Canada, with respect to a number of offences, offences against the narcotic laws of the two countries are not included. The purpose of the present treaty is to provide the power of extradition as between this country and the United States where offences are committed in either country against the narcotic laws of the other.

Narcotic Act Offenders
As is set forth in the resolution the treaty was signed at Washington on January 8, of the present year, and consent of the United States Senate to ratification was obtained on January 27. The procedure of the negotiation and of the signing of this treaty has been in accordance with the procedure laid down at the Imperial Conference in 1923, and the procedure with respect to ratification will also be in accordance with the understanding reached at that time unanimously by the several governments of the empire. It may interest the House to know that extradition treaties have been signed between His Britannic Majesty and the United States at various periods since 1842, notably in 1889, 1900, 1905 and 1922, providing for the surrender of persons against whom prima facie evidence exists of certain crimes. The list of such crimes now includes murder, manslaughter, arson, burglary, embezzlement, perjury, bribery, and other specified offences. It is now proposed, as regards Canada and the United States, to add to the list of crimes or offences for which extradition may be granted, crimes or offences against the laws for the suppression of the traffic in narcotics, of the country making the request for extradition.
Previous extradition treaties between His Britannic Majesty and the United States- 1842, 1889, 1900, ' 1905, and 1922-applied to cases in which the crime was committed, or, in the other contingency, in which the offender was found, in the United States or in any part Of the British Empire. The present agreement is confined to cases in which the offence was committed in the United States or in the Dominion of Canada, and the person so charged is found in the Dominion of Canada or the United States respectively.
The necessity for such an agreement arises from the elaborate organization of drug rings throughout the world, and the dimensions to which the traffic has developed. The Minister of Soldiers' Civil Re-establishment and Health (Mr. Beland) speaking a moment ago gave to the House very fully, the reasons which render advisable this treaty for the extradition of offenders against the narcotic laws.


Arthur Meighen: Before the Prime Minister sits down-I notice this is called a "convention" and the former arrangement a "treaty"-would he tell us what the difference is?


William Lyon Mackenzie King: The two terms are largely interchangeable. They are both more or less formal; a "treaty" is more formal and important than a "convention." I would assume that in the present case use of
either term might have been correctly made. The matter dealt with here being a minor matter and the agreement being largely in the nature of an amendment of a former treaty, it was not given the designation of "treaty" but the less formal designation of a "convention."


Arthur Meighen: I am a little confused
not only at the various titles to these many documents but the variety as well of the style of recital. I noticed that the last document was termed a "treaty" and I have always been under the impression, which the Prime Minister was under, that a treaty is the more formal, being entered into between the heads of the contracting states. A "convention," the least formal, is usually, in fact is always, entered into between the states themselves, for example the Post Office convention that exists between Canada and the United States, but here we have a treaty which is supposed to be the most formal and it starts in this way: "His Majesty the King of the United Kingdom" and so forth and "the United States of America"-that is, between the head of the one country and the other country-"being desirous of" and so forth, "agree as follows." But instead of calling it a "treaty" they called it a "convention." Coming now to the second document with which we are dealing at the present time, instead of being as the first one was between His Majesty the King and the United States-formal on the one side, informal on the other-this convention is formal on both sides. It is between "The President of the United States of America and His Majesty the King of the United Kingdom of Great Britain and Ireland and of the British Dominions beyond the seas, Emperor of India" and so forth. What I am drawing attention to is that it is only confusing to have these various titles. As a matter of fact under the very reading of the document the greater formality attaches to the "convention;" it is between the heads of the tvyo states. There is a lot of fine doctrine now appertaining to these matters since this complicated arrangement was made in 1923, so much so that I am lost in the maze of the whole thing.


Andrew Ross McMaster: Then why are you endeavouring to instruct us?


Arthur Meighen: I am not endeavouring
to instruct, I am endeavouring to find out the facts, and I have more faith, perhaps, in the hon. member for Brome really shedding
Narcotic Act Offenders

some illumination than I am in getting it from any other source. I hope, therefore he will have pity on my mystification and come to the rescue before it is too late. Where are we going to drift to in these matters? There are other documents to be ratified. I think the next two are called "conventions" and they are differently described altogether as respects the parties between whom they are negotiated. I would think uniformity would be best-uniformity all down the line-and so far as I am concerned I think it would be better to follow the heading in this convention in every single instance. Then we would know that at least we are following a certain definite form. We would understand what it is and why it is. We would not be mystified between various forms of language and different titles and no logic or reason in them at all. I make this comment also: that it would be better, it seems to me, if we could have fewer of these treaties, conventions, or whatever in the world you call them, and get them all into one. In the last one there is a provision for the extension of the extradition rights. Why was not that treaty, which was concluded only a few months before this one, made wide enough to include this one?


William Lyon Mackenzie King: I think I can answer that to my hon. friend's satisfaction. There is some rule of procedure with respect to extradition law which is different from the rule with respect to other classes of treaties. In other words, matters relating to extradition are supposed to be surrounded with the greatest secrecy, which does not apply to other treaties. The United States government, when it was suggested to amend the extradition law, requested that it should not be made a part of the treaty regarding smuggling. Their reasons for it, as I have said, as given to us, were that in matters relating to extradition they preferred that the whole matter should be kept as secret as possible and not made part of a general treaty. It was at the instance of the United States government itself that the matter wras presented in a separate, supplementary document.


Arthur Meighen: I am not clear as to where the difference in secrecy lies between a convention and a treaty. One is just as public as the other. But the point I was making was this. In the treaty regarding smuggling there is provision as to extradition; if it is not extradition, it is something very close to it. I read from the treaty this clause:

The following offences are added to the list of offences numbered 1 to 3 in article 1 of the treaty concluded between Great Britain and the United States on May 18, 1908, with reference to reciprocal rights for Canada and the United States in the matters of conveyance of prisoners and wrecking and salvage, that is to say:
4.	Offences against the narcotic laws of the respective governments.
This may not be actually extradition, but it is about the same. It would seem to me there is no substantial objection to having the whole of them in one, and very probably these two subsequent ones as well. Really it is a bad month nowadays when we do not have a new convention with the United States. I am beginning to think we shall have to adopt the suggestion made by the hon. member for South York (Mr. Maclean) for approach to this House. We shall have to construct a tube between here and Washington, so as to enable the minister to get down there and return with expedition. He could probably add roller skates to his equipment.


Ernest Lapointe: With reference to the terms
"convention and treaty", my right hon. friend the Prime Minister (Mr. Mackenzie King) might have said those two terms were used interchangeably. But to relieve my right hon. friend (Mr. Meighen) of any anxiety in the matter, I may say I have here the first extradition treaty between the United States and Great Britain. It was called a treaty, and was negotiated in 1842. Then in 1889 new offences were added to the list of those that were extraditable, but then it was a convention supplementary to the treaty. In 1900 another convention was entered into, still supplementary to the treaty.	In 1907 another convention w*as signed and called a convention. So the convention of this year is still a convention, and I think every one of us ought to be satisfied with the name. My right hon. friend asks, why have a separate treaty or convention to add this offence to the list of extraditable offences, when in the other treaty concerning smuggling there is a section adding the same offence to the list of those with reference to the reciprocal rights of Canada and the United States in the matter of conveyance of prisoners? Well, it is not the same thing at all. This treaty for the conveyance of prisoners is a separate treaty entered into in 1908. It does not give the right of extradition, but it gives the right of an officer of either the United States or Canada who is in custody of a prisoner on his own territory, to convey him on the territory of the other country for the purpose of bring-

Narcotic Act Offenders
ing him into his own territory. That is simply to avoid long transportation in some cases, but it is quite different from an extradition treaty. Now, as has been suggested, perhaps it would have been better not to put the provision in the same treaty, because the extradition treaty is a special document; but at the same time, when the first treaty was signed, the other one might have been signed also. Canada was prepared at that time to sign the extradition treaty adding the special offences, but the United' States was not prepared to sign it. There must be agreement on both sides in arranging a treaty; so that we had to postpone the signature of this one.


William Garland McQuarrie: What are the additional crimes referred to in this resolution?


Ernest Lapointe: All the crimes and
offences against the law for the suppression of the traffic in narcotics. My hon. friend will find a list of them in chapter 22 of the Revised Statutes of 1923.


[Stage Direction]
Motion agreed to.
William Lyon Mackenzie King: That a message be sent to the Senate informing their honours that this House has adopted the above resolution, and requesting that their honours will unite with this House in the approval of the above-mentioned treaty. And that the Clerk do carry the said message to the Senate.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the Orders of the Day.
Mr. WILLIAM IRVINE (East Calgary):: In view of the fact that the provincial government of Nova Scotia has not appointed a commission upon which the Prime Minister based his refusal to take action, and in view of the fact that a deadlock still persists and the conditions of distress still prevail, does the government now intend to take any action.


William Lyon Mackenzie King: The government will be
pleased to take into consideration the representations the hon. member has just made. Up to the present time we have not had an opportunity of considering the matter.
MILITARY DISTRICT NO. 10-^COAL INQUIRY
On the Orders of the Day.


James Shaver Woodsworth: Does the government propose to lay
on the table the report of the royal commission appointed to investigate the alleged frauds in the sale of coal to the Department of National Defence in military district No. 10?


William Lyon Mackenzie King: I am unable to say whether it is the present intention of the Minister of Defence. I do not think he will have any objection but I would rather the hon. member would permit the matter to stand till the minister himself is present, when he will be in a position to give a definite answer.



SELECT STANDING COMMITTEES

[Stage Direction]
On the Orders of the Day:
William Garland McQuarrie: When does the government propose
that the committees of this House should get down to business? Last year there were no meetings of committees until after the Easter adjournment, I think, and the session was prolonged into July. Is the same thing going to happen this year? Would it not be possible to have committees sitting immediately so that we might get down to business?


William Lyon Mackenzie King: That, I think, is a matter for members of the committees themselves to decide. If my hon. friend is on a committee and would like it to meet, he has only to ask the whip to see that it be called together.


William Garland McQuarrie: I will certainly do
that.



SOLDIER SETTLEMENT-REDUCTION OF INDEBTEDNESS

[Stage Direction]
On the Orders of the Day:
Mr. ALFRED SPEAKMAN (Red Deer):: Is it the intention of the government to introduce legislation during this session to provide for reduction of indebtedness on the part of returned men who have taken land under the provisions of the Soldier Settlement Act?


William Lyon Mackenzie King: I am afraid I shall have
to ask the hon. member to allow his question to stand until the Minister of Immigration and Colonization (Mr. Robb) is here.


Alfred Speakman: I will repeat my question when that hon. gentleman is in his seat.
Ocean Shipping Rates



CANADIAN NATIONAL RAILWAYS- BRANCH LINES

[Stage Direction]
On the Orders of the Day:
Mr. N. H. McTAGGART (Maple Creek):: Will legislation be introduced at thds session making provision for the construction of Canadian National branch lines; and if so, when is it expected that legislation will be brought down?


William Lyon Mackenzie King: Perhaps, my hon. friend
will allow the Minister of Railways and Canals (Mr. Graham) to answer that question to-morrow.



FEDERAL AID TO HIGHWAYS

[Stage Direction]
On the Orders of the Day:
Mr. A. L. BEAUBIEN (Provencher):: Have the government any announcement to make in regard to federal aid to highways?


William Lyon Mackenzie King: No announcement to
make.



OCEAN SHIPPING RATES


[Stage Direction]
Hon. T. A. LOW (Minister of Trade and Commerce) moved that the House go into committee to consider the following proposed resolution:
That to give the government of Canada control over certain ocean rates it is expedient to ratify and confirm the agreement between His Majesty and Sir William Petersen, K.C.B.E., as set out in the schedule to this resolution, and dated the eleventh day of December, one thousand nine hundred and twenty-four, and that in view of the provisions of said agreement giving the government control over such rates and of the services to be performed thereunder, the Governor in Council may authorize payment out of the consolidated revenue fund to the said Sir William Petersen, K.C.B.E., of an annual amount of two hundred and seventy-five thousand pounds in the manner and for the period provided for in the said agreement.
Schedule
Articles of Agreement
made this eleventh day of December in the year of Our Lord 1924,
Between
His Most Gracious Majesty King George V represented herein by the Honourable Thomas A. Low, His Majesty's Minister of Trade and Commerce for the Dominion of Canada, hereinafter called " the minister," of the one part; and Sir William Petersen, Knight Commander of the British Empire, of the city of London in that part of the United Kingdom of Great Britain and Ireland called England, hereinafter called " the contractor," of the other part.
Whereas it having come to the knowledge of His Majesty's government in Canada through repeated and 
continuous representations made by the agricultural community of the Dominion and the manufacturing, producing, commercial and financial interests as well as the general merchants throughout the country, that these trading communities and interests have been and are still seriously handicapped and hampered in their trade relations with overseas countries in bringing their products to such markets and there disposing of them profitably owing to certain difficulties and disadvantages which have been artificially created, and it has been shown that such difficulties and disadvantages are due largely to transportation conditions and the uncertainty of ocean rates indiscriminately placed and imposed upon their goods so exported from time to time, such rates being levied by ocean shipping combines and under the control and jurisdiction of such combines or shipping conferences;
And whereas the consumers of Canada are also interested in the control of ocean rates charged on commodities shipped from British and European continental ports;
And whereas the government of Canada after an investigation of the representations brought to its knowledge and after giving the same serious consideration has thought it wise to adopt such means as may be deemed expedient and necessary to exercise such supervision and control of trans-Atlantic freight rates as it is possible for them to do and thereby as far as possible to prevent and defeat any unreasonable excess or overcharge in ocean freight rates as exercised by such ocean shipping combines or conferences to the loss and detriment of its citizens and has reached the conclusion that in order to more fully safeguard the interests of its citizens it would be well advised to enter into an arrangement whereby it may exercise such control or supervision and whereby it may improve the conditions under which the products of its citizens are exported or imported;
And whereas the contractor has offered to supply a fleet of ten up-to-date new ships of the most modern type with all the latest known appliances for ensuring economy, speedy and cheap transportation and fitted in every respect for ocean service, some of which ships are now in course of construction and all of which are to be approved by the British Board of Trade and are to have the highest classification at Lloyd's and Bureau Veritas Shipping Registries, and the contractor is to furnish all particulars and details of such ships to the technical representatives of the government, and have the same approved by them, such particulars and details being referred to more fully in Schedule " A '' which forms part of these presents;
And whereas the contractor has offered to establish and maintain the said fleet of ships as aforesaid in the service hereinafter referred to for a period of ten years from the commencement of the said service or for any longer period that may be mutually agreed upon for an annual subsidy of two hundred and seventy-five thousand pounds (£275.000);
And whereas the government of Canada offer to accept the same subject to ratification by parliament and subject to the terms and conditions more particularly hereinafter set out:
Now this agreement witnesseth that the contractor for and in consideration of the premises and of the covenants and agreements on the part of His Majesty hereinafter contained for himself, his executors and administrators,
Doth hereby covenant and agree to and with His Majesty, His Heirs and Successors in manner following, that is to say:-
1.	That the contractor shall and will either personally or by a company which he may form (and it is hereby understood and agreed that this contract

Ocean Shipping Rates
may be executed, performed and fulfilled by a duly incorporated company formed or to be formed by or at the instance of the contractor, which company when formed shall be accepted by His Majesty instead of and in lieu of and in substitution for the contractor, and which shall be hereinafter referred to as the " shipping company ''):-
(a)	Build, equip, provide, establish and during this contract, continue and in the manner hereinafter mentioned, operate a regular shipping service between such ports in Great Britain or Ireland or the continent of Europe, and Canadian ports as may be designated by the Minister of Trade and Commerce for Canada or his representatives from time to time;
(b)	Establish and continue and maintain and operate as hereinafter set out the shipping service hereinbefore referred to free from the control of and independent of the Atlantic Shipping Combine or Conference or any other combine or conference now in existence or which may be operated or established upon the Atlantic ocean at any time in the future without the sanction of the government of Canada;
(c)	That such service shall be put in effect and maintained with ten ships as hereinbefore referred to and these shall be built and placed in operation with all possible despatch and shall be fully completed and put in service within eighteen months from the date of this agreement (at least two of the same to be placed in service by August 1, 1925) and pending completion of the same, other ships of modern construction properly equipped and of approximately the same tonnage shall be substituted and operated in the said service until the fleet in question is completely constructed and in operation, the said service to commence with at least six ships not later than June 15, 1925;
(d)	That the control and regulation of the rates to be charged by the contractor shall rest with the government of Canada and that the government shall fix such transportation rates on all commodities from time to time;
(e)	Make proper provision for the carriage of perishable and partly perishable produce by means of cold storage facilities;
(f)	Carry emigrants from Great Britain or the continent of Europe at rates to be fixed by the government and carry all Canadian mails free if and when the parties hereto agree upon the establishment of a passenger service or other steamers suitable for the carriage of emigrants in conjunction with and under the control of the shipping company.
2.	And His Majesty for himself, his heirs and successors hereby covenants and agrees with the contractor, his administrators and assigns that the contractor well and faithfully performing all and every the covenants, agreements and stipulations hereinbefore set forth and contained by the said contractor to be done and performed shall well and truly pay or cause to be paid to the contractor, his heirs, administrators and assigns during the continuance of this contract an annual subsidy of two hundred and seventy-five thousand pounds (£275,000) from and out of the consolidated fund or other proper moneys of the Dominion of Canada, the same to be paid and payable to the contractor at the city of London, England, in equal monthly instalments payable monthly at the end of each and every month (unless otherwise agreed upon between the contracting parties) in each and every year during the continuance of this agreement, the first monthly instalment to become due and payable one month after the commencement of the service hereinbefore referred to (which shall not be later than June 15, 1925) and instalments monthly thereafter unless the parties hereto mutually agree upon other terms of payment.
3.	And it is mutually covenanted and agreed between the parties hereto that the subsidy payable to the contractor in the preceding paragraph is based cn the operation and maintenance of a service of ten ships and the subsidy aforementioned shall be increased or reduced as the case may be in proportion to the number of ships operated and maintained by the contractor in the service aforesaid from time to time and such increase or reduction of subsidy shall be added to or deducted from the monthly payments hereinbefore provided for in paragraph two.
4.	And it is mutually covenanted and agreed between the parties hereto that the shipping services to be established by the contractor herein will co-operate and work loyally with the Canadian National Railway system and the fleet of ships operated by that system and under its control and known as the Canadian Government Merchant Marine.
5.	And it is mutually covenanted and agreed between the parties hereto that should any of the ships in the service aforesaid be lost or disabled the contractor shall have the privilege of substituting a modern ship of approximately the same tonnage for the ship lost or disabled until the same is replaced or repaired and put in service again as the case may be.
6.	And it is mutually covenanted and agreed between the parties hereto that on receiving at least three months' notice from the minister herein the contractor shall arrange to place additional ships up to the number of ten in this service on an increase in subsidy in proportion to the number of ships actually placed in service; the subsidy referred to in paragraph two being based on a service of ten ships; and the additional service to be put in effect within twelve months from the date of the receipt by the contractor of the notice aforesaid.
7.	The contractor shall not convey or permit to be conveyed in any steamer while- employed in this service any nitro-glycerine or any other articles which in the opinion of the minister shall be considered dangerous.
8.	If at any time after the expiration of the eighteen months mentioned in paragraph 1 (c) the contractor should fail to carry on the said service with the full complement of ten ships, the minister may by notice in writing call upon him to supply the deficiency within a delay of three months, and in default of the contractor's doing so within such delay, the minister may terminate the contract by notice in writing.
9.	And the contractor covenants and agrees that the vessels in the said service shall prosecute all voyages made by them with all possible speed and despatch.
10.	The minister shall have the privilege at his option of entering into contracts for like purposes with any other contractor or contractors.
11.	And it is mutually covenanted and agreed between the parties hereto that this contract is to continue in force for the full period of ten years from the time when the first service under the terms hereof is commenced; and the same may be extended for a further period of time and under such terms and conditions as the parties hereto mutually agree upon.
12. Except to the company to be formed by the contractor as hereinbefore provided for to whom this contract may be assigned no other assignment thereof either by the contractor or by the said company is to be or shall be made nor any right nor interest therein without the consent in writing of the minister having been first obtained.
Ocean Shipping Rates
[Stage Direction]
In witness whereof the Honourable Thomas A. Low, " the minister " hath hereunto set and affixed his hand and seal as such and " the contractor" has hereunto set his hand and seal the day and year first above written.
C. D. Macaulay. Thos. A. Low,	[seal]
Minister of Trade and Commerce.
William Petersen.	[seal]
Province of Ontario County of Carleton To Wit
I,	Charles Daniel Macaulay of the city of Dawson, in the Yukon Territory,
Supreme Court Judge, make oath and say:-
1.	That I was personally present and did see the within instrument and duplicate original thereof duly signed, sealed and delivered by the Honourable Thomas A. Low, His Majesty's Minister of Trade and Commerce for the Dominion of Canada, and Sir William Petersen, Knight Commander of the British Empire, the parties hereto.
2.	That the said instrument and duplicate original were executed by the said parties at the city of Ottawa in the county of Carleton.
3.	That I know the said parties.
4.	That I am a subscribing witness to said instrument and duplicate original.
Sworn before me at the city of Ottawa
in the county of Carleton }- C. D. Macaulay. this 11th day of December A.D. 1924,	J
H. H. Donald,
Notary Public.
Schedule u A "
Particulars (without guarantee) of two corrugated open shelter deck motor vessels with topgallant fo'-castle and crusier stem building by Harland & Wolff Ltd. at Henderson's Glasgow.
Class	100 A.L. and B.V.
Length overall 416'	B.P. 400'
Breadth moulded 55' 6" corrugation 59'
Depth 28' 4"	S.D. 37' 10"
Deadweight (including bunkers) 9,000 tons on 25' Cubic capacity (abt.) 580,000	grain
Tonnage (approximately) 5,000 gross 3,500 nett Capacity of oil bunkers 750/800 tons Height of 'tween deck	9' 6"
Bulkheads longitudinal and
9 Transverse steel bulkheads
Holds
Hatches
3
1
31' 6" x 20'
29' x 20'
27' x 20'
13' 4" x 10' 7J"
Engines B. & W. single 4 cycle Diesel Horse-power	Brake 1850	Ind. 2250
Dia. of cylinders	(six) 740 m.
Length of strokes	1500 m.
Speed about 11 knots on about 7$ tons oil Winches 8 3-ton, 3 5-ton, electric Electric auxiliaries One Ord. vert. Donkey boiler
100 sq. feet heating surface 100 lbs. pressure
And subject to such modifications and alterations as may be agreed upon by the parties hereto.
He said: Mr. Speaker, I desire to take this first opportunity of explaining to the House the full details of this contract as I believe the country as well as the House is anxiously awaiting such explanation. I wish to say at the outset that it is the intention of the gov-

ernment, in full realization of the importance of this measure, to refer it to a select committee. When the bill itself comes up for its second reading, parliament will be asked to refer it to such a special committee, so that anybody who has any suggestions to offer or any questions to ask may have an opportunity of being heard1 before the contract is ratified.
This matter of ocean freight rates and ocean combines is not a new one. It has been brought to the attention of governments and of parliament many times during the past twenty-five years. Numerous commissions have been appointed and each commission in turn has reported that a combine did exist.
I shall endeavour this afternoon to establish to the satisfaction of the House that a combine does exist; that Canadian ports have been discriminated against in favour of United States ports, and that the preference which the dominions have given to the Mother Country has been nullified in many instances, by the action of this combine. I intend to show that the British manufacturer and the British merchant have been discriminated against in favour of German and other foreign merchants. I intend to show that, perhaps, there is nothing retarding immigration to this country more to-day than the action of this gigantic combine.
The item of greatest interest to us in the subject is the actual "ocean rates" and I intend, this afternoon, to try to establish- and I think I shall succeed in doing so-that these rates are exorbitant, and unjustified. In my endeavour to prove that, I propose to call as my star witness the hon. member for West York (Sir Henry Drayton). I intend to establish by his sworn testimony that he was of the opinion that a combine existed, and that, when he gave evidence before the Dominions Royal Commission, he was of the opinion that the rates at that time were unnecessarily high. How much more does that apply to-day?
There seems to be no doubt that a combine exists. It embraces almost all the leading shipping companies of the north Atlantic- the American line, Anchor-Donaldson, Baltic-America, Canadian Pacific Railway, Companie Generale, Trans-Atlantic, Cosulich, Cunard, Hamburg-America, United-America, United States, Intercontinental Transports, Holland-America, North German Lloyd, Norwegian-American Company, Cairns-Noble Company, Scandinavian-American, Swedish-American, Red Star, Royal Mail Steam Packet Company, White Star, White Star Dominion, Furness-Withy Company, Maclean-Kennedy Company

Ocean Shipping Rates
Mr. MACLEAN (York):: Under what different flags are they flying? Is the minister prepared to say that?


Mr. LOW:: I am not prespared to say, but
I think the majority are plying under the British flag. The rates of all these companies sailing out of Canadian ports are generally fixed at the city of New York. One can realize how little interest Americans or those who are associated with them at the head office in the city of New York, will display for Canada or Canadian ports. The activities of this combine have been the subject of investigation upon more than one occasion. In 1909, the British government became alarmed and	appointed	a commission	known asthe Royal Commission on Shipping Rings. I am sorry	to say	that I	have notbeen	able to	secure	a copy	of theirfull report, but I have evidence that they	reported	that a	combine	did exist.
Then there was the commission appointed by the Canadian government of the day, the Drayton commission in 1913. Of the finding of my hon. friend from West York (Sir Henry Drayton) there can be no question. At that time the hon. member was plain Mr. Drayton, chairman of the Board of Railway Commissioners, whose one concern was to look after the interests of the people of Canada. I find in his report the following:
The position when action was taken by your honourable body was that steamship conferences were effective so that no competition was afforded beyond the sporadic competition that the tramp freight boat affords. Competition of this character affords no protection whatever to shippers requiring regular shipments in less than cargo lots. In my view, such a condition practically eliminates all competition, and requires some governmental control.
And again:
This affirmation by a member of the conference of a condition under which the business of any given importer could, at any time, perhaps by the carrier's whim, lack of information, or desire for an excessive return, be at least temporarily extinguished, would appear of itself, to call for the fullest investigation	
Might I be permitted to say that, if the Dominions Royal Commission could take this matter up and make an interim report on it, if necessary, I do not think the inquiry could be in better hands.
On the recommendation of my hon. friend the matter was referred to the Dominions Royal Commission. That commission was not appointed solely to inquire into the question of ocean freight rates; its creation was the result of a resolution adopted at the Imperial conference held in 1911. Six members were appointed to represent the British government, while each dominion was represented by one member. I might cite the purpose of the commission:
The Dominions Royal Commission came into being in consequence of a resolution passed by the Imperial Conference of 1911. The members were first appointed on the 15th April, 1912. Six represented the United Kingdom and one each Canada, Australia, New Zealand, the Union of South Africa and Newfoundland.
The representative of Canada on that commission was a gentleman whose opinion I am sure hon. members opposite will have no hesitation in accepting as authoritative-I mean the Right Hon. Sir George E. Foster. That gentleman concurred in the findings of the commission, who state:
In the pre-war period, as we pointed out in our second interim report, British steamship companies had made a practice of charging a lower rate to New Zealand from Hamburg and other German ports than from London on the same classes of goods. We may repeat the observations which we made then on this state of affairs:-"The net effect of this
practice...has been, and must be to facilitate the
competition of German manufacturers with British in New Zealand, unduly to handicap British manufacturers, and to destroy, at least to the extent of the difference in freights, the advantage intended by New Zealand to be given, by means of preference, to the British manufacturer." No satisfactory explanation of the matter was given to us at the time by the companies concerned. No assurance, to the best of our knowledge, has been given either to Your Majesty's government or to the New Zealand government that similar practices will not continue after the war. The case is much the same with regard to the differential freight rates charged on asbestos from Canada to foreign and British ports, to which attention was drawn in our Fifth Interim Report.
Now listen, to another clause which was concurred in by Sir George E. Foster:
For ourselves we regard it as intolerable that British shipowners should be in a position to initiate or countenance practices of a kind so directly inimical to British trade.
And again in their finding the commissioners state:
We are satisfied that the operations of the steamship
companies should not remain longer without some .measure of government control. This view is based on two grounds:-
(a)	That in normal times the combination of shipowners is strong enough to limit the freedom of shippers, whose varied and detached interests make it difficult for them to combine in any effective opposition.
(b)	That in some cases shipowners have used this power to grant more favourable freight rates on foreign than on British goods.
That was the finding of the Dominions Royal Commission appointed by the British government, on which there was a representative from Canada in the person of the Right Hon. Sir George E. Foster.
But perhaps the most thorough and exhaustive report that has been made on the subject was that of the committee appointed by this House two years ago under the able chairmanship of the hon. member for Brome (Mr. McMaster) when evidence was brought out which convinced this government that it was time for action.
Ocean Shipping Rates

Now, much has been said of the Preston report; but after all is there anything new in the Preston report? There is nothing in that report that was not contained in the report of the agricultural committee appointed by this House. I have noticed many press comments upon the Preston report, but in each case almost entirely-


Arthur Meighen: Will the minister tell
us how much it cost?


Thomas Andrew Low: If my right hon. friend wishes
to draw a red herring across the trail I am sure a simple question like that will not succeed.


Andrew Ross McMaster: We hope value was
given.


Thomas Andrew Low: The question as to the cost of the Preston report will prove I am sure of value to this House and to the people of the country. As I was saying, a section of the press of Canada in an endeavour to discredit that report has attacked its author, but I am glad to say that only a small wing of the press has assumed that attitude. But I am not so much concerned about the author of any of these reports as I am concerned about their contents. It has been charged that there has been discrimination against Canadian ports. I am sure that no hon. member in this House who was a member of the former administration will attempt to deny that assertion. It was brought to the attention of the government on more than one occasion during that time, and it was brought again to the attention of this government. In the fall of 1923 I prepared a memorandum for the Prime Minister (Mr. Mackenzie King) and the Minister of Railways (Mr. Graham)., who were then going over to attend the Imperial conference, and I asked them to bring before the Economic conference the question of discrimination against the flour exports of this country. They did so, with the result that the matter was adjusted in a few weeks. But that discrimination had continued for many years. The American miller was able to mill bis wheat and ship it to Liverpool and London at from eight to ten cents a barrel less than the Canadian miller; and worse than that, he was able to buy Canadian wheat, mill it in transit and ship it at this advantage over his Canadian competitor. The government succeeded in having that discrimination adjusted.
Now as to immigration. To-day perhaps nothing is retarding immigration more than the action of this combine. In 1900 an immigrant could be brought to this country for $17.50; to-day it costs $85. In 1900 a man, his wife and five children could be landed in 
Canada for $122.50; to-day it costs $600. Contrast this with the fact that this combine will carry European emigrants to South America, more than double the distance, at lower rates than they are quoting to Canadian ports. Let me read a letter from one of our immigration officers to show how adversely these high rates are affecting immigration to this country. Evidently he was not thinking of this debate, for he writes:
The prospect of securing farm labour from Great Britain did not look encouraging at the end of the month. The high third class fares have turned many to ask for assistance, and our officers report large numbers of applications for assisted passages in whole or in part. As only a small number of these applications can be absorbed, it would appear that many very desirable farm workers will be unable to go to Canada by reason of the cost of passage. However, it is too early to give a final word in this regard.


Mr. BRISTOL:: Will the minister give us
the particulars on which he bases his comparison of ocean rates? In other words, do the rates to South American ports include railway transportation, or are they purely port to port rates?


Thomas Andrew Low: Before this debate is concluded I shall be very glad to furnish my hon. friend with all the details he requires. Now I come to the exorbitant freight rates charged by the North Atlantic Steamship Conference, and I think, as I said before, that the evidence of my hon. friend from West York (Sir Henry Drayton) is conclusive on this point. He was then-1916-chief commissioner of the Board of Railway Commissioners, and when giving evidence before the Dominions Royal Commission in October, 1916 he was asked whether in his opinion ocean freight rates were too high. He replied:
My own conclusion, from the little investigation which I was able to make, was that the companies were perfectly right in saying that the cost has largely increased. But while all that was true, the increased carrying facilities of the boats were so great that when you came to prorate the increase over your carrying unit-the marine ton-the cost per carrying unit had gone down, although the cost per vessel for operation per trip had gone up very much. Or course, the cost per carrying unit is the decisive matter on which your rate should be based.
That was the opinion of my hon. friend from West York, and if that were the condition at the time at which he was speaking I am sure it is still worse to-day. As further evidence that these rates are altogether out of proportion to the increased cost of other things, I desire, with the consent of the House, to place on Hansard a letter from a manufacturer.


Mr. CLARK:: Before the minister proceeds further, would he give details of the evidence that he has been quoting from?

Ocean Shipping Rates


Thomas Andrew Low: Part one, page 334, paragraph
4,675, of the Minutes of Evidence taken in 1916 by the Royal Commission on the Natural Resources, Trade, and Legislation of Certain Portions of His Majesty's Dominions. The letter to which I referred was 5 p.m. written by a manufacturer who charged that the rate on his article of export had increased from $1.50 per ton of 40 cubic feet in 1911, to $12 at the present time. In 1911 the writer was exporting a carload of instruments every week; to-day he is not shipping one carload in a year as the result of these exorbitant rates. But hon. members will get a better idea of this manufacturer's complaint when they read his letter in Hansard to-morrow. The letter reads:
Now, I am enclosing you documents that will prove the statements which I am to make.
At the present time, as you will see by the ocean bill of lading I am sending you dated October 21, 1924, we are paying 30 cents per cubic foot or $12 per ton of 40 cubic feet, on organs or pianos going to Liverpool. In 1910 we paid on similar instruments six shillings and ninepence per ton of 40 cubic feet, which is practically $1.50 per ton of 40 cubic feet, as you will also see by the enclosed ocean bill of lading.
I am also sending you bills of lading of the years 1911, 1912 and 1913. In 1911 we paid six shillings and ninepence per 40 cubic feet. In 1912 and 1913 we paid twelve shillings and sixpence and 5 per cent per 40 cubic feet, which is practically $3 per 40 cubic feet, as you will see by the bills of lading enclosed. To-day, as already stated, we are paying $12, which is 400 per cent of an increase over 1913 and 700 per cent of an increase compared with what we were paying in the year 1910, and for many years before.
As a glaring example of what this combine is demanding of us, in the way of ocean freight rates, I might state that we are shipping musical instruments to-day to Cape Town, South Africa, at $9.50 per 40 cubic feet, and on which, as already stated, we have to pay $12 to Liverpool. The distance in one case is three thousand miles and in the other case where we are paying less freight, six thousand miles.
It will be quite safe in saying that ten or fifteen years prior to the year 1910 referred to above, we were paying only six shillings and ninepence per 40 cubic feet on these instruments.
You are at liberty to make any use of the enclosed documents you wish, only return them to us when you are through with them.
I have representatives of the steamship companies calling on me every week, who are complaining about the small amount of freight that is offered, and I never miss an opportunity of telling them that it is all their own fault, as the prohibitive freight rates make it impossible for us or anyone else to do the business we were doing before the war.
In 1910 and 1911 and for many preceding years, we were shipping a carload of instruments to Liverpool every week. The car would contain eighteen instruments. To-day we nor anyone else ship a carload in a year, simply because the freight rates, added to the price that we must get for our instruments, brings them up to the price of what they can purchase a cheap piano for in England, of German or English make. We might say that we have cut our prices
for export, to the bone, in fact the cost, as we regard this export trade merely a means to reduce our overhead.
Our experience is the experience of all other manufacturers of musical instruments in Canada, and also the experience of all those who ship bulky goods where the rate is calculated on a ton of 40 cubic feet
basis.
If I can be of any further service to you, do not hesitate to ask me, as I feel that the steamship companies, including the Canadian Merchant Marine, are only preventing trade coming to them by demanding such exorbitant freight rates, and I sometimes think that the Canadian Merchant Marine are the worst sinners of the lot.
For instance, we had a number of instruments going to the West Indies some weeks ago, and have also a shipment of five going this week, and we found that the Canadian Merchant Marine rates were much higher than what we were quoted from Pickford <4 Black of Halifax, so instead of sending the instruments to Montreal, we had to send them to Halifax and the amount saved on the ocean freight more than paid the difference on the inland freight between Montreal and Halifax.
I have also a letter from the Cockshutt Plow Company Ltd., of Brantford, which I am sure will be of interest to my hon. friends opposite, and which reads:
Answering your letter of November 27 with reference to freight rates on goods for United Kingdom ports, rates on agricultural implements have almost quadrupled in the period you mention. Prior to the war there was practically a uniform rate of ten shillings and sixpence per ton on implements. This might fluctuate occasionally, due to temporary conditions, but we used to figure approximately $2.50 per ton. To-day there is apparently a tight conference ruling on freight rates to these ports, and the best rate we have been able to obtain for some little time has been $10 a ton. It puts us in an unfavourable position as compared with doing business with other markets. When one considers that goods can be laid down in South Africa for $7.50 per ton and in Buenos Aires or Montevideo for $7 per ton; the hauls in both cases being more than double that to the United Kingdom ports.
We can assure you that any assistance the Department of Trade and Commerce can render exporters in connection with these rates will not only be appreciated but will be beneficial to the various industries interested.
Yours very truly,
COCKSHUTT PLOW COMPANY LTD., Geo. G. Scott.
Export Department.
The Manitoba Free Press, commenting upon ocean rates in an editorial last June, stated:
The railways have increased their rates 40J per cent, the steamship companies 160 per cent. No one so far has had the temerity to attempt to approve that the cost of operating ships has increased in that proportion. The only means whereby the North Atlantio Conference or combine can be brought to time is by the Canadian government securing ten or twelve tramp ships, having them properly fitted and putting them into the cattle trade with a rate of $10 per head to any British port.


Mr. GARLAND (Bow River):: The minister has quoted a despatch from the papers giving certain rates. Were those rates average
71S
Ocean Shipping Rates

rates for all commodities, or rates on some specific commodities?


Thomas Andrew Low: I think the reference was to
cattle rates. Now, take the opinion of the Canadian Manufacturers' Association, and I am sure that my hon. friends opposite will not readily dispute anything that that association may say. As I read the Montreal Gazette and the criticisms of our plan to reduce rates, I have been wondering just whose opinion it represents. Usually it voices the opinion of the manufacturers, but on this occasion it is taking issue with the manufacturers, because the manufacturers presented a memorandum to the Imperial Shipping Company about a year ago, as follows:
Exporters and importers, however, view with considerable alarm the general tendency which has been expressed by material increases in ocean rates this spring in a number of the important trade routes. In this connection we would particularly point out the North Atlantic United Kingdom Conference east-bound placed into effect on March 1st a general increase in ocean rates, which was stated to average twenty-five per cent, although some important commodities were increased to a much greater extent. Protests were entered with the steamship companies against these proposals, but while the matter is still under investigation no adjustments have as yet been made. We feel that the level of rates now in effect is unreasonable when compared with the basis in effect in 1914, or just prior to the war. An examination of a number of rates on important commodities indicates that the present level of ocean rates from Canada to the United Kingdom is from 166 to 433 per cent higher, and we believe that this level is in excess of what is warranted by general conditions.


Edmund James Bristol: Would the minister allow me another question? I see in this document, which apparently is issued by the Atlantic Conference, and has been mailed to us, a statement as follows:
In the list of eastbound rates promulgated by the North Atlantic Conference no rate or agreement 's made in respect of grain, flour or cattle, these rates being absolutely open.
Is that statement true or not?


Thomas Andrew Low: I do not know whether it is
true or not, but I am prepared to say this: If there is no rate fixed by the North Atlantic Conference on grain, there is no credit or thanks due the North Atlantic Conference, because the tramp ships coming into Canadian ports regulate the price of carrying grain across the Atlantic.


Edmund James Bristol: I am asking for facts, if
the rates include cattle.


Richard Burpee Hanson: Is it not a fact that the
regular liners out of Montreal are carrying grain cheaper than the tramp steamers out of Montreal?


Hewitt Bostock: I think it would be more in conformity with the rules if hon. gentlemen would leave the minister free to explain the main features of the resolution. Then, when we are in committee, questions can be put.


Thomas Andrew Low: Mr. Speaker, I shall now endeavour to establish that the rates are exorbitant. Perhaps one of the most important products of the farm is bacon and other meats. In 1911 the ordinary storage cost was 16.88 cents per one hundred pounds; to-day it is 50 cents per one hundred pounds, an increase of about 200 per cent. In cold air storage, in 1911 it cost 22.24 cents per one hundred pounds for bacon and meats; to-day it costs 85 cents per one hundred pounds, an increase of about 300 per cent.
It costs $7.50 to carry a ton of newsprint to Cape Town, South Africa, a distance of 7,108 miles; it costs $10.08 to carry the same ton of newsprint to London, a distance of 3,241 miles, and $8.00 to Buenos Ayres, a distance of 6,421 miles. In 1914 the rate on newsprint to the United Kingdom was $3.04 per one hundred pounds; to-day it costs $10.08 per one hundred pounds, an increase of about 231 per cent.
Now I shall quote the rates and increases in another line outside of the conference which is being subsidized by this country and carrying on a service to South Africa. In 1914 it cost $7.30 to carry a ton of newsprint to Cape Town; to-day notwithstanding the increases, it costs $7.50 per ton, or almost the same, because, fortunately for the people of Canada and the newsprint men, the Elder-Dempster Line is not in the combine.
As I said at the outset, this is not a new question. The matter has been brought to the attention of parliament upon more than one occasion, and in the year 1920 there was a rejection by the Acting Prime Minister, Sir George E. Foster, as reported in Hansard of May 5, page 2013, of a resolution moved by Mr. Armstrong asking that the recommendation of the Dominions Royal Commission be given effect. The Acting Prime Minister stated that he was not prepared to accept the motion and advised the hon. member to drop it, which was done. Again in the following session, the then Minister of Trade and Commerce, Sir George E. Foster, answering a question in the House on this matter as reported in Hansard of May 18, 1921, page 3530, as to whether the government intended to give effect to the report of the Dominions Royal Commission, stated that the government were awaiting the inquiry of the Im-

Ocean Shipping Rates
perial Shipping committee. The minister further answered:
After this investigation is finished and the reports made, what action, if any, is to be taken by the government will have to be determined after the reception and consideration of these reports by the committee.
So, Mr. Speaker, as I said before, this is not a new question. Governments and parliaments have been appealed to before on this same question.
When the decision of this government was announced in the press, I read two or three articles in which the question was asked, why did not the government approach the ship owners or the Imperial Shipping committee? And it was charged that we had approached the matter in the wrong way. I also notice that all the shipping companies are very emphatic in their denial that the commissioner ever approached them with reference to freight rates. Well, I do not know about the commissioner, or whether he approached them or not; but they will not have the hardihood to say that I did not approach them. A year ago I asked the shipping men, the representatives of the different shipping companies, to meet me in Montreal and, after several meetings in which I appealed to those gentlemen to make a slight reduction on the carrying charges on cattle across the Atlantic, I received no encouragement whatever. I offered, if they would reduce the rate, to give an understanding that I would see how far the government was prepared t-o go in supplementing such reduction. They met me more than once, and about all I received from them was a pleasant smile, I could make no headway; and now they wonder why we did not approach them before we decided to deal with Sir William Petersen and enter into a contract with him. A few days ago I received a cablegram from certain of the vessel owners of England offering to refer the whole matter to the Imperial Shipping committee for investigation. Well, the reply to that is that the matter is now before parliament, and that if these shipping companies have any representations to make I am sure the committee to be appointed by this House to deal with the subject will be glad to receive their representations. But we have had a little experience with the Imperial Shipping committee. I noticed by the press the other day the claim that the matter of discrimination in the rates on flour had been remedied by their visit to Canada. I am glad to be able to say that the matter was adjusted by the efforts of the Prime Minister and the Minister of Railways and Canals, when they were attending the Economic conference in
England. The people of this country made many representations to the Imperial Shipping committee when they were here about twelve months ago, and I have failed to observe that any great relief has been given to Canadian shippers up to the present time. Therefore if this matter were referred to the Imperial Shipping committee I should like to feel assured-although I feel quite satisfied that this government is going to be in power for another twenty years-that there would be some hope of getting a remedy for the existing grievances before we go out of office.
That brings me to the contract upon which I desire to say a few words. The government looks upon this as a cast-iron contract. It was drawn by one of the best legal minds in Canada-perhaps, the foremost in this country. So that if there is anything wrong with the drawing of the contract it is not through any lack of effort on the part of the government to secure the best counsel possible. The most important provision in that contract is-


Mr. BOYS:: Who is the cast-iron contract with?


Thomas Andrew Low: I hope my hon. friend has
read the contract embodied in the resolution?


William Alves Boys: I have.


Thomas Andrew Low: Then I am sure it discloses the information for which he has asked.


William Alves Boys: Do the government regard the covenant of Sir William Petersen as in anyway vital to the contract?


Thomas Andrew Low: We do, and I may say that the contract contains a clause providing that not one dollar is to be paid over to Sir William Petersen until the services contracted; for have been rendered by that gentleman.


William Alves Boys: Does the minister object to
another question?


Thomas Andrew Low: Well, I would rather my hon. friend would wait.


William Alves Boys: Certainly. I do not wish to be discourteous, and if my hon. friend objects I will not ask the question at this stage. But I understood the minister to say that he regarded the covenant of Sir William Petersen as vital. If that be so cannot Sir William Petersen, under clause 1 of the contract, escape his personal covenant entirely by substituting for this contract one with a proposed company, and when the contract of the proposed company is completed will it not supersede the contract in question and in that event Sir William Petersen's convenant will no longer be in existence?
Ocean Shipping Rates


Thomas Andrew Low: I might just say to my hon.
friend that this is a matter for discussion at a later date. Now I want to make a few references to Sir William Petersen who is not unknown to the Canadian people, nor to the North Atlantic Conference.


William Alves Boys: That is why we want his covenant.


Thomas Andrew Low: He has successfully apposed
that conference upon more than one occasion during the past quarter of a century. Sir William Petersen first became known to the people of Canada when he came to this country in 1893 with a fleet of boats to engage in the carrying of coal from Cape Breton to Montreal. About that time the collieries of Cape Breton amalgamated and the rate per ton for the carriage of coal was approximately $1.25 to $1.50. Sir William Petersen succeeded in cutting that rate practically in two, and to-day it remains at about the same. Again he was one of the first gentlemen-if not the first-to introduce the carrying of grain from the head of the lakes to continental ports. In 1897 he entered into a contract with the Laurier administration, a contract about which much has been said in the press. The details of the arrangement are familiar to all hon. members. What happened in 1897 was that the German conference and the North Atlantic linesi fought the Petersen scheme with such tenacity that the government granted an extension of one year. The following year the Spanish-American war broke out. As all hon. members know that war as all wars played havoc with shipping companies, and as a result the whole scheme was abandoned. Perhaps over in England they have a higher opinion of Sir William Petersen than some hon. gentlemen opposite. His position during war time alone should substantiate our confidence in him. In 1916, with the approval of the British government and through the President of tihe Board of Trade, he was elected chairman of the British committee of the Bureau Veritas, the largest shipping registry in the world, exclusive of Lloyd's, with headquarters at Antwerp. This committee superintended the construction of standard vessels for the British government during the war, the testing and inspection of war material and facilitated munitions. Sir William was also given authority to dispose of the German fleet interned in Portugal and Brazil. To-day, seven years after the war, Sir Wiliam is still chairman of the British committee of the Bureau Veritas.
That is his record in England, and I am sure that any contract that this government has entered into with Sir William Petersen is

sufficiently safeguarded to protect the people of this country. We hear much about the Petersen fleet of ten ships. It is referred to by some hon. members as a mere flea bite, but let us make a comparison with some of the best known lines in the north Atlantic trade. Take the Write Star line. I have never heard the White Star line described as a flea bite in Canadian trade, nor of no account, yet here are the details of the White Star Canadian line:
Passenger and freight	Built in Gross tonnage
Regina	
1916	16,500Doric	
1923	16,484Megantic	
1909	14,878Canada	
1896	9,472
Freight and Cattle
Oxonian	
1898	6,383Turcoman	
1892	5.829Colonian	
1892	6,583Cornishman	
1891	5,749Welshman	
1891	5,730Caledonian	
1900	4,998
It will be noted that the greater number of freight and cattle boats are from 30 to 35 years old. They have earned their depreciation, and they have paid for themselves twice over. They owe their companies nothing, and in all probability they are not in a position to compete with the very up-to-date boats that are built to-day.
The Anchor-Donaldson line is not looked upon with contempt, yet it has four passenger and six freight steamers only, on the Canadian service.
I have a list of the ships of the Anchor-Donaldson line, the Canadian Cunard service, the Furness Withy Company, the Head line, the Manchester line, the Cairn line and the Canadian Pacific ocean services.
The Anchor-Donaldson Line-
Passenger and Freight steamers Built in Gross tons
Saturnia	
1910	8,611Cassandra	
1906	8,135Athenia	
1923	13,465Letitia	
1924	13,400
Freight steamer
Cabotia	 1918	5,160
Cattle and freight steamers
Concordia	
1917	5,388Kastalia	
1919	4,663Parthenia	
1917	4,753Gracia	
1921	5,642Moveria	
1924	5,200
The Cunard Canadian Services have not been hitherto regarded as insignificant, yet they have but ten boats: five passenger and freight; five freight steamers on the Canadian service, as follows:
Passenger and Freight steamers Built in Gross tons
Asconia	
1924	13,900Antonia	
1921	13,867Ausonia	
1921	13,912Auronia	
1924	13,900Alaunia	
1924	13,900
Ocean Shipping Rates
Freight steamers
Vasconia	
1918	5,680Vellavia	
1918	5,272Verentia	
1918	5,185Virgilia	
1918	5,697Verbauia	
1918	5,021Vardulia	
1917	5,691
The Furness Withy Co. have only three freight^ vessels on the Canadian Service, namely:
Canada to London and Hull (fortnightly) (cannot carry cattle)
Built in Gross tonnage
Cornish Point .. ..	.. .. 1914	4,259Comino	.. .. 1918	4,618Ariano	.. .. 1918	5,155
The Head line plying to Irish ports from Canada has but six freight vessels with an average tonnage of 5,000.
Canada to Irish Ports-about fortnightly (do not carry cattle)
Built in Gross tonnage
Carigan Hoad ..	
1901	4,201Mulmore Head .. .,	
1918	5,319Fanad Head .. ..	
1917	5,200Lord Londonderry .	
1902	5,796Lord Downshire..	
1900	5,223Lord Antrim .. ..	
1902	4,665The Manchester	line is well	known andinfluential in the	Canadian Atlantic cattle	and freight trade.	It too numbers but seven	vessels of approximately 5,600	average tonnage.
(Canada to Manchester-Weekly)
(can carry cattle)
Gross
Built in tonnage
Manchester Regiment	
1922	7930Manchester Brigade	
1918	8021Manchester Hero	
1916	5738Manchester Division	
1918	6027Manchester Corporation	
1899	5397Manchester Importer	
1899	4028Manchester Producer	
1916	8576
The Cairn line is not an inconsiderable one in Canadian Atlantic trade, but its total fleet so employed numbers but seven freight steamers of an average tonnage of roughly 5.000 tons.
Freight Steamers
		Gross
	Built in	tons
Caimtorr	
1922	5,387Gaimmona	
1918	4,666Caimross	5,494Cairn valona	4,929Gaimgowan	5,295Caimdhu	5,250Cairnavon	5,245
Canadian Pacific Steamships Limited- Atlantic Service Passenger and Freight Steamers:
Built in Gross tons
Empress of	Scotland	
1905	25,128Empress of	France	
1913	18,357Montlaurier	
1908	17,282Montrose	
1922	16,402
Passenger and Freight Steamers-Con.
	Built in Gross tons	
Montclare	1922	16,314Montcalm	1921	16.418Montroval	
190S	15,646Montreal	
1906	9,749Melita	
1918	14,000Mmnedosa	1918	14.000Metagama	
1915	12,420Marburn	
1900	10.743Marglen	
1898	10,417Marloch	
1904	10,687Crampian	
1907	10.955Pretorian	
1901	6,948Freight Steamers:	Batsford	
1914	4,782Bawtry	
1917	5,692Belton	1899	6,173Bolingbroke	
1917	6,608Borden	
1906	4,852Boswort.h	
1919	6,661Bothwell	
1919	6,723Brandon	
1917	6,655Broeeon	
1918	6,650Bruton	1899	7,397Freight Steamers-West Indies service:	Balfour	
1918	5,038Berwyn	
1912	4,874Passenger and Freight	Steamers-	Pacific service:	Empress of Asia.. ..	
1913	16,909Empress of Russia..	
1913	16.810Empress of Austraflia.	1921	21,881Empress of Canada..	
1922	21,517As a matter of fact, taking them all	in all,
the Petersen line will compare very favourably with any fleet working out of the port of Montreal or the Atlantic ports outside of the Canadian Pacific ocean services. We often hear the question asked, why does the Merchant Marine not pay? Well, I am not a shipping man myself. Perhaps I could not do better than quote from the authority of Mr. Fetterolf of 'the International Mercantile Marine lines, speaking in the city of Boston a few days ago, and reported in a New York paper of February of this year. The report reads as follows:
A. C. Fetterolf, freight traffic manager of International Mercantile Marine lines delivered an address on Tuesday night at the annual dinner of the Traffic Club of New England at Boston. Mr. Fetterolf is an authority on ocean transportation and has had many years of experience in trans-Atlantic shipping. His remarks at the dinner in Boston defined clearly the position of not only the I.M.M. lines but of steamship companies operating out of practically all ports of the world.
Of the boats of the class of the Government Merchant Marine he makes the! following derogatory statement:
"Another class, more or less temporary, is a product of the war and may be placed in a category by themselves on account of the disappointment that they have brought to their owners and shippers alike, namely, the war built standardized cargo ship. They were built of such materials that could be quickly assembled without regard to their suitability for commercial uses.
'These ships are at best a compromise, and, as they

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were designed for no particular trade, they do not give the best results in any trade."


Sir HENRY DRAYTON:: I think that
speech refers entirely to the ships built by the American government in their standard plan. The hon. minister can correct me if I am wrong.


Thomas Andrew Low: They certainly apply to the
merchant marine.


Henry Lumley Drayton: The minister
says so, the speaker does not.


Thomas Andrew Low: (1)	From our investigation, it seems that Sir William's estimate of the cost of ocean carriage under his proposal is substantially correct:
(2)	We have nothing to fear from competition or hostility on the part of others as this would in the last analysis be to the advantage of Canadian shippers.
(3)	It looks as if there might be more in the Petersen type of ship construction than we have been led to believe.
(4)	There is no doubt about Petersen's experience and knowledge of the shipping business:
(5)	The proposals, if they can be brought into effect, would be of material advantage to our shipping public.
The above is the way it looks to me in a general fashion, and perhaps this little analysis may be of some assistance to you.
Yours sincerely,
H. W. Thornton.
That was the endorsation of Sir Henry Thornton.


Henry Lumley Drayton: I do not want to disturb the minister, but at this point it would be very interesting to get the costs of the new boats if we could have that while this submission is going on.


Thomas Andrew Low: That will be presented to the House and to the committee in due course.


Henry Lumley Drayton: I would assume the government knew it before they made the contract. They evidently did not.


Thomas Andrew Low: In conclusion, I just wish to
state that the government of my right hon. friend, the leader of the opposition (Mr. Meighen) was appealed to from time to time to do something in connection with ocean combines and ocean rates. Similar representations were made to this government.


Arthur Meighen: Will the minister tell me who appealed to the government of which I was the head?


Thomas Andrew Low: Of which my right hon. friend was a member. It is the opinion of the government that they have taken what offers as the best plan to break in on the combine in an endeavour to reduce rates, not alone to the Canadian farmer, but also to the Canadian manufacturer. If any hon. member has any better method to suggest, I am sure that the House will be very glad to have it offered for consideration. But we have given this matter a great deal of thought and we have reached the conclusion that this suggestion offers practically the only method by which the combine can be broken.


Arthur Meighen: The minister referred to the government of which I was a member being appealed to in this matter. I should be glad if he would give the reference as to who made the appeal.


Thomas Andrew Low: There is ample correspondence
on the files, and there is the resolution which was introduced by one of the supporters of my right hon. friend. Was that not an appeal to do something?


Arthur Meighen: Lake freights, was it not?


Thomas Andrew Low: Not lake freights at all-ocean freights. I read the item and I will read it again if my right hon. friend so desires. The resolution was introduced by Mr. Armstrong, one of the representatives from Ontario, and as I stated, the Right Hon. Sir George E. Foster, who was leading the House at the time, asked the hon. member to drop his resolution. The resolution asked that effect be given to the findings of the Dominions Royal Commission. To-morrow, my right hon. friend will find it on Hansard.
All the dominions are aroused over the matter, and not alone in the dominions is it creating discussion, but in the British parliament at the present time questions are being asked and the matter is being debated. I am sure it must be apparent to every hon. member that it is time for some government in the Dominion to take some action.
At six o'clock the House took recess.
After Recess
The House resumed at eight o'clock.
Hon. H. H. STEVENS (Vancouver Centre) [DOT] The subject matter of the resolution now before the House is one of great importance and it touches such a variety of subjects and interests that I shall not presume for one moment to attempt to cover the whole ground in the course of my remarks. I purpose rather dealing with the question in a more or less general wray and when we get into committee, if we arrive at that stage, we can discuss the details much more fuilly and with perhaps greater effect.
Having reference to the observations -made this afternoon by the Minister of Trade and Commerce (Mr. Low) in introducing the subject, I -have just a few things to say. My hon. friend, at the very outset, said in effect that he would proceed to show that a combine did exist, that its rates were exorbitant, and so on. He then referred to a large number of commissions that had been appointed at one time or another, remarking quite truly that this was not a new question, that it had been discussed on many previous occasions, and that various bodies had investigated and reported upon it. I was surprised when he said that one of the most

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important investigations that had been held was that of the royal commission appointed by Great Britain which reported in 1909, and the minister also said that he had found it impossible to secure a copy of the report of that commission, and he expressed regret at that fact. I was surprised to hear him make that statement, and I immediately sent a page to the Library and within five minutes received the report. I do not know, therefore, why my hon. friend should have experienced any difficulty in getting a copy of it.


Thomas Andrew Low: It was probably out of the Library at the time.


Mr. STEVENS:: Not at all. As a matter of fact, the minister mentioned previously that he had been dealing with this question since last June, and I doubt whether the report has been out of the Library at all. At any rate, it was there when I sent for it and I got it and looked it over. It is rather unfortunate, I think, that the minister had not secured a copy of this report, for there are some very interesting tilings in it. I notice for one thing that this commission was appointed first in 1906 and reported in 1909; and I notice further that Canada had a representative upon it for a time, among other distinguished gentlemen. That representative was Isaac Hendry Mathers, Deputy Receiver General of Nova Scotia, and it is recorded in the report I have under my hand' that he resigned after about a year, as Canada's interests were not affected at ail. I want to read to the minister a few excerpts from this report. I have not had the time to study this report as carefully as I have studied another one which I have by me, of equal or greater importance, and which also, I presume, the minister has failed to see. At this point let me observe that had the minister had his erstwhile agent, one Preston, take this report along with others and sit down in the Library of this parliament, there could have been prepared an infinitely better report for presentation to parliament than the one we have before us and to which I desire, shortly, to give my attention. However, in the present report to which I have alluded I find among the recommendations at the end, the following:
It was suggested by some of our witnesses notably Mr. Treclwen, that all that was required to check abuses of the conference system was that the shippers and merchants in a given trade should form themselves into an association so that they might be able to present a united front to the conference when any controversy arose.
The report then observes:
This suggestion we adopt as our main recommendation.
The document then proceeds to deal with a lot of detail. Let me point out in passing that this important commission, to which the minister referred this afternoon and whose report he admitted not having read, recommends this system. Among other things the commissioners say this:
There are numerous important questions arising between merchants and shipowners which cannot be properly determined by legislation.
I pause here to make this remark, that this is exactly the situation with which we are faced to-day-differences between shippers and shipowners. They go on to say:
We consider that most if not all the serious abuses to which the system is liable can be remedied by such counter-combinations on the part of merchants and shippers, and that it is generally undesirable that the state should interfere to remedy or prevent grievances which by reasonable effort can be prevented or remedied by the persons concerned.
That is very sound doctrine which I commend to the government. It is undesirable for the state to interfere in private business operations, but rather should it bring about a reconciliation between conflicting interests by a process of reasonable conference between those affected. The report then makes this very trite observation:
We are confirmed in this view by our belief that the majority of the shipowners conducting the operations of conference lines are public spirited men fully alive to the desirability of encouraging trade.
That, I think, will be found in marked contrast to the spirit of the report immediately under review and forming the basis of the resolution. There are three or four other findings of this commission which I will not bother to read.


Mr. SINCLAIR (Queens):: Is the hon.
member quoting from the majority report?


Henry Herbert Stevens: Yes; and now that the
hon. member has asked that question I may quote from both. I have been quoting from the majority report but there was also a report submitted by the minority. Let me read further, however, from the same report:
We do not consider that inquiry should be ordered where associations merely complain that rates are too high or unfair, or where, owing to a temporary rate war, rates from a foreign country may have been lower for a short time than from the United Kingdom.
That is rather a strange doctrine in view of what my hon. friends have been saying. However, the point I want to emphasize-and I do not wish to be misunderstood or misquoted-is that in this very intricate and complex question, which has been investigated by the very best authorities on the subject for many years, it is recognized that the difficulties being as involved as they are, it is
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undesirable to seek to straighten them out by any arbitrary act of parliament. A course must be followed which will tend to promote harmonious relations between shipper and ship owner.
Now, my hon. friend suggests that there may be a minority report. There was. Let me state that the main portion of this report deals with the subject of rebates rather than conferences, although the two are reported on together. This is an extract from the minority report:
We who sign this minority report think that, before the adoption of legislation declaring illegal the deferred rebate system, or involving great interference by a government department with the details of the working of a highly complex industry, and leading probably to much litigation, a real attempt should be made to give effect to a system of conciliation and limited supervision by the board of trade.
There again you have the same doctrine expounded. I shall not weary the House by quoting further from that report. I read this, however, for the purpose of impressing upon the members of the House this fact: It is true this is a complex and delicate question, fraught with the greatest difficulties, and in spite of all the experience we have behind us there is a grave danger in injecting into it arbitrary legislative action.
My hon. friend referred also to the report of the agricultural committee of two years ago. He said that it was one of great importance. If that is the case, why did not the government some time within the last two years take cognizance of this clause in the agricultural committee's report, which report was commended to the House by the minister this afternoon:
The committee desire to bring the facts in this regard to the earnest attention of the House,-
Dealing now with the North Atlantic conference.
-and would respectfully suggest that the Minister of Railways and Canals should take the matter up with those responsible for the management of the boats of the Canadian Government Merchant Marine, so that the complicity of the Canadian Government Merchant Marine in this combine may be brought to an end immediately.
This afternoon the minister professed to have a great regard for this report; but for two years since the report was made the Canadian Government Merchant Marine has been "sitting in" in this conference. I am not blaming the management for that, I am merely stating the fact. For two years the government have gone sweetly along their way ignoring this report, and now they come forward to tell us that it is of great importance and is in support of the report made by Mr. Preston, and that therefore his report should be accepted by the House.

My hon. friend also addressed to the House as a reason for the recognition of the Preston report and its acceptance certain quotations from the evidence taken by the Dominions Royal Commission. Does he not recall that his quotations refer exclusively to New Zealand! and to trade to British ports- British trade? I am going to deal with that at some length in a moment or two. What I want to point out to my hon. friend is that he is justified in quoting the Dominions Royal Commission in regard to grievances that New Zealand1 or some British ports had, but he is not justified in expending nearly a million and a half dollars of the taxpayers money to subsidize the Petersen interests.
Now, I address myself directly to the resolution. Its basis will be found in a section of the Speech from the Throne which I desire to quote in laying the foundation for my argument, and the House will bear with me a moment while I again bring to their attention this paragraph from the Governor General's speech:
It is becoming increasingly evident, however, that quite as important a factor as the customs tariff in their effect upon production and living cost9 are transportation coats and rates, by land and sea. It is the opinion of my advisers-
The government.
-that the attention of parliament at the present session should be directed more particularly to the desirability of effecting a freer movement of commodities through an equalization of railway freight rates as between provinces and localities, and through a lowering of carrying charges upon shipments by water of the products of the farm, the mine, the forest, the fisheries, and of our manufacturing industries.
Some measure of control of transportation by land and sea is obviously essential-
And so forth. In other words, Mr. Speaker, we have presented to us by this official document these suggestions:	First, that the government have in mind the freer movement of commodities; and, secondly, the lowering of the carrying charges.	And it alleges that
there is a powerful steamship combine restraining the export trade. The very essence of the proposal embodied in the resolution now before the House rests on this test: Will the proposal bring about the control of ocean freight rates?	That, I say, is the
test of the whole question and I purpose focusing the attention of the House upon it. Will the proposal of the government bring about a freer movement of commodities and a lowering of carrying charges? Or perhaps I should be more charitable and say:	Is it
likely to bring about this result? Is it reasonable to expect that it will? What is the basis of the proposal? It is found in a report by one, W. T. R. Preston. His report

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is offered as the reason for the resolution and for the remedy suggested, and it is all the evidence adduced by the government to support the charge that a combine in restraint of trade exists. I wish to call the attention of the Prime Minister (Mr. Mackenzie King) and of the Minister of Trade and Commerce to the fact that when this resolution was originally placed on the order paper I asked for the correspondence between Mr. Preston and those affected, or for any correspondence bearing upon the subject. The hon. Minister of Railways (Mr. Graham), who replied, stated that there was no correspondence so far as he knew. So we have only this report to support the contentions of the government that such a combine exists.
Now, Mr. Speaker, our business as a House is to analyze and weigh this proposal. I ask, first: Does it offer a satisfactory remedy of the alleged grievance? Secondly: Has the maker of this report demonstrated that the alleged injury is an actual injury? These are the two questions I ask at the moment, and I purpose examining the report in regard thereto. All through the report the maker of it refers to the North Atlantic conference a3 a combine in such terms and in such a tone as to convey the impression that it is an evil and sinister thing. I apprehend. Sir, that it is not the part of an impartial investigator to adopt at the outset and to preserve throughout his report to the end a prejudiced attitude towards the subject of his investigation. The least that such an individual should do is to seek to be fair and impartial in his investigation. I am not for the moment suggesting that there is not a combine, but I say that the maker of the report is not justified in starting from the premises that an evil and sinister influence exists in the form of a combine.
In the second place, I want to say this: A combination of trade interests is not necessarily in itself an evil thing, and I think the House ought to pause and consider that. The Prime Minister is very fond of pausing this session, and I invite him to pause for a moment and consider this point, that a combination of trade interests, I do not care what they are, is not necessarily an evil thing.


William Lyon Mackenzie King: Hear, hear.


Henry Herbert Stevens: My right hon. friend
says, "hear,, hear," and I know that that is sound. Then I say to him that this report bears evidence that this institution referred to is judged and condemned from the very commencement and before any investigation was held. Indeed, the minister (Mr. Low) this afternoon referred to the fact that ever
since last June he had had in his mind this ten-ship remedy for the situation. Now let me proceed. A combination of interests, or a conference, or whatever you like to term it, a combine, if you will,-although I do not like to apply the word combine because almost invariably it carries with it a suggestion that is not necessarily contained in the word, but a combination of interests in regard to shipping-may have some beneficial results.
I say it may have. It may stabilize service; it may result in a uniformity of rates; it may improve shipping conditions; it may render possible recovery of losses in shipping; it may fix regularity of service. These are some of the things it may do, and are these evils? Everyone within hearing of my voice knows they are not. As a matter of fact, Mr. Speaker, no one disputes the fact that there is a conference, or a combination of interests existing in connection with shipping. It is unnecessary to establish that; it is admitted. The point we have to decide, however, is this: Has this conference been conducted contrary to the interests of the public? Has it been injurious? Has it been sinister? Or, on the other hand, has it contributed to the benefit of the country and to the benefit of shipping? I think we must admit that there are some benefits accrue from this conference, and I wish to state them. I think it is necessary and only fair to do so if we want to be impartial in this matter.
I know as a matter of my own personal knowledge, and I think it will not be disputed, that about the beginning of the year, about March, which is the beginning of the shipping season on the St. Lawrence, and the same thing applies to other sections, a list is supplied freely to shippers giving the fixed sailing dates of ships throughout the whole season from March, in the case of the St. Lawrence, to October or November. Now these fixed sailing dates are very valuable to shippers. They enable shippers to contract for the future: shippers are thereby enabled to provide for the contracting of delivery of goods to other countries for months ahead; they are likewise able to contract months ahead for the purchase and receipt of goods from other countries. Furthermore, by this method of fixed sailings the shippers, large and small, are assured of cargo space. In addition to that, there are almost daily sailings fixed from the port of Montreal. The reason I take the port of Montreal is this: There is no doubt in my mind from reading the resolution and the report that the point of attack-shall I say?- is the St. Lawrence route, or the port of Montreal and the lines running from there. In a
72S
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lesser degree, of course, other points will be affected. Now I submit, Mr. Speaker, that these are things that are beneficial to the shipper in this country; these are things that we ought to recognize and frankly acknowledge.
I turn now to the consideration of another British report, which I have under my hand. It is the report of the Commission on "Shipping and Shipbuilding, a commission appointed, I think, by Mr. Asquith in 1916. The commission reported in 1918, a very excellent report, comprising a large volume, and most exhaustive in its research and in its findings. I want to read an extract from that report to form the basis of some further comments. This report, mark you, is dealing with the question of conferences, with the question of this great combination of conferences, if you like, referred to in the report of Mr. Preston:
Conference Agreements. Broadly, conference agreements are designed to prevent the kind of abuses which has attracted so much attention in the New Zealand trade hut immunity from such abuse may be bought at too high a price. Shipping, however, could not subsist on rate wars, and the whole object of conferences is to avert them and to produce equality of rates and stable conditions in the great ocean trades. This aspect of the matter was clearly brought out in the report of the Royal Commission on Shipping Rings-
That is the report to which the minister referred, and which I have also under mv hand:
-and we see no reason to dissent from the general conclusions stated in that report.
Let me pause to point this out. Through all the reports of these British investigating commissions, the report of 1909, the report of 1918, the Imperial Shipping committee's report, the report indeed of the Dominions Royal Commission, there runs a singularly uniform note, that it is inadvisable to precipitate conditions that bring about rate wars, and inadvisable also to have too much government interference with shipping and with the operation of ships on the high seas. I sav this is singular, and it is rather important and most interesting.
Now in connection with the report that we have as a basis for this resolution there is a letter issued by the party who prepared this report, Mr. Preston. He says:
I acted on my own judgment, and so forth.
I thought it better to have a frank discussion and I therefore present d the following memorandum.
I have under my hand the memorandum which he prepared, and which he suggests in the report that he sent to all the shipping concerns. I do not know whether they received it, but I notice in the press of this

morning or yesterday that one after the other of the shipping companies have absolutely denied ever having received any invitation from him at all; but whether they received it or not does not alter the fact I wish to place before the House. What I wish to point out is the strange procedure followed by this gentleman. He pre-judges the case. If you will read the letter-I do not intend to read it all-you will find he declares that a combine that is sinister in its influence exists. Mark you, Mr. Speaker, this letter is supposed to be addressed to individuals whom he declares he is going to invite to a discussion; but before he invites them, indeed, in the very letter he alleges to have sent them as an invitation, he tells them that they are in an evil combine, a combine of sinister influence. He furthermore tells them, and this is the strangest feature, that a decision had already been arrived at. He tells them that it was proposed to deal with the matter in one of two ways:
(1)	By an arrangement with an independent steamship company with government assistance, and government control over freight rates or,
(2)	The establishment of a government service between British and Canadian ports with modern vessels.
The former is regarded as the more desirable.
So he had already judged, before he made any steps to inquire into the business at all, what course he was going to pursue. Then in the latter part of the memorandum he indulges in what is undoubtedly a threat. For instance, he tells the shipping interests in connection with this company which he proposes to establish that:
The government railways traverse the Dominion of Canada in about 2-1,000 miles of tracks or service. It is fair to presume that whatever action the government takes in the matter, will be towards linking up the suggested ocean transportation with this enormous mileage of National railwaysand so on. In other words he simply says this:	You ship owners and shipping companies are leagued together in a combine and I judge you and condemn you. That is his first point. Secondly he says:	I have
already found a remedy and that remedy is the organization of a separate company-in this case the Petersen Company under government subsidy. In the third place he says: It is my intention, and it is the government's intention, to link this special company, subsidized by the government, up with the railways; and the inference is left, to the prejudice of all other concerns as far as the securing of freight by these railways is concerned.


William Lyon Mackenzie King: Was not Mr. Preston, in the statement which he made,

basing his remarks upon the finding of a committee of this House, to the effect that there was a North Atlantic combine?


Henry Herbert Stevens: Well, I have already referred to that. The Prime Minister, I think, perhaps is right; but let me put to him the question I put to the minister; I am glad to put it to him because he is the leader of the government:	If this finding of the committee
on agriculture of two years ago is of such importance, why did the government not take cognizance of this clause which I read a moment ago and which I will read again:
The committee desire to bring the facts in this regard to the earnest attention of the House, and to respectfully suggest that the Minister of Railways and Canals should take up the matter with those respons'ble for the management of the boats, so that the complicity of the Canadian Government Merchant Marine in this combine may be brought to an end immediately.
Now, I ask the Prime Minister this question: If that report is of such grave importance as he would suggest, why did not the government two years ago pull the Canadian Merchant Marine out of the combine? If the existence of a combine, to which the right hon. Prime Minister now refers, was established by that committee to a sufficient extent to form the basis of Mr. Preston's report so that he need investigate no further, why did the government allow its own ships to continue for two years in that iniquitous combine?


William Lyon Mackenzie King: I am told that the ships that were built as part of the merchant marine were not at all suited for the class of transport that is required between here and the Old Country. The matter was looked into, it was gone into very carefully at the time, and when the government found that the merchant marine were not suited in any way to meet the situation that we are face to face with, we began to take other means to bring about an effective meeting of the situation.


Henry Herbert Stevens: My right hon. friend will
pardon me, I do not wish to be impertinent, but he has not answered the point at all.


Some hon. MEMBERS:: Oh, oh.


Henry Herbert Stevens: Some one laughs. I will
deal with the question of the suitability of the ships in a moment, I have the necessary memoranda under my hand. I am now dealing with-the propriety shall I say-? of government ships continuing for two years in a combine that is declared by the government's own emissaries to be an evil thing, continuing for two years after a committee had reported
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-and upon this report they rest their case,- that the combine existed.


William Lyon Mackenzie King: I am told-I
speak subject to correction-that one of the operations of this combine is, that if any line withdraws from it it will immediately attempt to undertake to put that line completely out of business. Now the merchant marine was in bad enough state when this government had to take it over, and we were not looking for a means to utterly destroy its usefulness.


Henry Herbert Stevens: I really have too high a
regard for the Prime Minister to attribute that to him, as a serious observation and the ground for my hesitancy will be disclosed before I finish my remarks to-night. I am not going to be driven away from this point: The fact remains that it is alleged that the combine existed. The government takes in perfect faith the report of the committee on Agriculture of two years ago-I do not, but the government does-they take it to the extent of saying that Mr. Preston was warranted in accepting the report holus bolus without any further investigation. And yet they come before this House and say in the words of the Prime Minister "We had to keep our ships in this evil combine for two years. If we took them out we were afraid that the other members of the combine would exercise some damning and bankrupting influence upon the government of Canada". Just on this point I again remind the Prime Minister that the control of rates was the suggestion in the Speech from the Throne; but under this proposal of Mr. Preston, and under the proposal of the Minister of Trade and Commerce this afternoon, the objective is to smash this combine. I should like the House to bear that in mind-the intention is to smash the combine. Very good. We will find out before we get through, the feasibility of smashing it with the puny weapon that the government has taken into its hands.
Now, the letter goes on to say that there has been occasional discrimination, that freight rates have been excessive, and that the insurance on the St. Lawrence is higher, and so on. I want to examine briefly one or two of these points. In the first place it has been known for years that the insurance rates on the St. Lawrence harm been high. It does not follow that a North Atlantic combine is to blame for the insurance rates on the St. Lawrence; that fact has nothing to do with the North Atlantic conference at all. As a matter of fact this government has to its credit the lowering of insurance to some slight degree:	They added thirty days to the
end of the open season, and took fifteen days
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off the first part of the season. In other words they added fifteen days to the St. Lawrence route during which favourable rates are granted. They also secured the same rates of insurance in the case of shipping from Halifax as are obtained in the case of shipping from New York. That is the way to do it. I want to say to the Prime Minister that it is by dealing with this question step by step-here a problem solved and there a problem solved-that these great commercial and trade matters are properly and effectively treated. The government, however, seem to have departed wholly from that course in regard to this as well as in regard to other matters.
Now with respect to discrimination, I wish to examine the report at feme little length. On pages 14 and 15 of the report will be found certain schedules. If the House will examine these schedules, and if the House will recall the speech of the Minister of Trade and Commerce this afternoon, it will remember and it will note this: That in every case it refers to a discrimination against British shipping from British ports, and very little in these schedules touches Canada at all. The report deals with the schedules from continental and United Kingdom ports to all sections of the world. Well, that is quite all right, but as to discrimination against British ports I want to ask in all fairness and with all courtesy, is it our business to take up the cudgels in behalf of the British shippers? Surely the British ship owners and the British merchants are wise enough, and skilled enough, and experienced enough to look after their own affairs. I do not want to say or to infer that we should wholly disregard their interests, but I do say that it is not the business of this country, of this parliament, or of this government to supply a subsidy to protect British shipping and British ports. Let us see what the British say themselves. I have it in their own reports, and it is worth reading. I wonder if the hon. member for Brome (Mr. McMaster) is in the House? Yes, I see him here. I wish he would listen to this particular clause. This is a clause drawn up by the British Commission on Shipping and Ship-building of 1918, and it must be remembered that it is drawn up by a free trade country so that there is something in it which seems to violate that idea.


Andrew Ross McMaster: Sound philosophy and
good sense.


Henry Herbert Stevens: My hon. friend in advance stamps the words I am about to quote as sound philosophy and good sense.

The British ship owner has to compete with the foreign ship owner in the provision of service, just as the British manufacturer has to compete with the foreign manufacturer in the supply of commodities.
That is perfectly sound. Then this report goes on to say:
To meet such competition rates for foreign goods may at times be lower than rates for British goods, just as British goods may be sold abroad at lower prices than they are sold to the home consumer.


Andrew Ross McMaster: Hear, hear.


Henry Herbert Stevens: Good free trade doctrine. The hon. member for Brome (Mr. McMaster) has stamped this with his approval already.
Some latitude in this respect must be allowed to the
ship owner as it is allowed to the manufacturer, since international competition would otherwise be impossible.
I pause to emphasize the point. The minister comes before us with a resolution approving of a subsidy of $1,300,000 a year to certain steamship lines. What for? He says they are discriminating against British ports and British shippers to every port in the world. I will come to Canada in a minute. The British House in their own report state that such things are permissible and that it is sometimes necessary to give a preference, to give better rates to foreign goods in order to meet the competition of international trade. I want to say that that is an economic axiom that you cannot escape; you can do what you like to seek to escape it but you cannot.
If the control of freights is confined simply to certain commodities of primary importance-
I want to read this to hon. friends to my left. I am addressing them in no captious spirit, but very seriously.
-a preference will be given to the carriage of all other commodities, and the result will therefore be the exact opposite of that intended. If the control of freights is confined to particular trade routes, British tonnage will be diverted from those trade routes to others in which the freights are not controlled.
That is perfectly sound reasoning. It is infinitely more wise than anything I find in the report before the House. It simply says this:	If you control rates in certain
commodities shippers will seek to carry other lines of goods and make as much money out of them, and raise the rates to break even in their revenue; or if you have certain ports or trade routes which are under control, shipping will be inclined to abandon those routes and frequent those that are not under control. What is the next step in the reasoning? I want hon. members from the province of Nova Scotia to consider this report. They talk about using Canadian ports. You talk about reversing this practice of shipping goods from Providence, Rhode Island, Boston

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and other ports but if you put a restrictive control upon Canadian routes you will find goods diverted through Maine and other states and going out through American ports. There is no escape from that. This British report, which represents a study of the whole situation, points to the danger of this form of control and restriction. We turn for a moment to Canada. We have a case where Canadian rates are higher than the rates from Germany. This is the matter upon which the writer of this report has apparently based a great deal of importance. He points out that goods coming from Hamburg to New York axe carried at a lower rate than goods from Canada to Liverpool. In this case he is comparing the rates westward to the rates eastward, a comparison which is neither fair proper, nor germane to the subject at all. That is about all the reference he makes to Canadian goods, except that I find a reference to grain, which I will deal with in a moment. The point that I wish to make at this stage is that ships from Canadian ports carry full cargoes eastward to the European ports, but almost invariably they come back with perhaps about a quarter cargo. I think that is a fair statement of the case. The result is that if you carry a full cargo one way and a quarter cargo the other way, the rates on the goods carried must be sufficient to pay for the trip both ways. That is a simple problem and a simple fact. That is one of the reasons why Canadian rates are high. Perhaps some of my hon. friends will say, "Well then, why not lower your tariff, so as to make a larger flow of goods into Canada?"


Some hon. MEMBERS:: Hear, hear.


Henry Herbert Stevens: I find that I have properly interpreted the view of some. I have a remedy which I think is much better than that. If you followed that course and- lowered your tariff so as to admit goods into the country, it is not likely you would increase the amount of goods coming from Europe or Great Britain, and the chances are that you would increase the influx of goods from the United States. To remedy this situation in Canada in regard to open freight rates, we want full cargoes from Europe. Bu.t they must be made up of goods bought in England or in Europe, which are to-day bought in the United States. I will tell my hon. friends why I hold to that point.


Mr. FORKE:: We favour a British preference.


Mr STEVENS:: I will very gladly discuss the British preference, but I want to finish
my argument if I may. I say we should increase the cargoes from Europe at the expense of the cargoes coming from the United States. I do not want to get into a side discussion, but I think the point is worth making. We owe the United States annually in interest about two hundred million dollars. In order to break even with them we ought to sell them two hundred million dollars per year more than we do. As a matter of fact we are importing annually from them two to three hundred million dollars worth of goods more than they bu3r from us, the result being that we are going behind the United States some four hundred and fifty or five hundred million dollars per year, and it is about time we designed a policy, irrespective of how we do it, that would divert to Europe and Canada the purchase of some of the goods which are now brought in from south of the line. That policy will go a long way to remedy the very grievance that we are labouring undter at the present time.
I will pass to another point, and I pause to remind the Prime Minister of something that I think perhaps he will find interesting.
I know that I found it interesting. Would he recall that in his speech delivered in this House a few weeks ago, on the occasion of the debate on the Address, he took a great deal of time to demonstrate that our foreign trade was in a splendid condition and our manufacturers better off than manufacturers south of the line and that conditions generally in Canada were more normal than conditions south of the line. I should like to read to the House what his special emissary says in that regard. In a paragraph headed "Closing down" he quotes an extract from some anonymous writer regarding that and says:
Further quotations from departmental correspondence [DOT]are uncalled for. It is only necessary to say that complaints have been received by the Department of Trade and Commerce from correspondents extending from the Maritime to the western provinces, clearly indicating that the increase in the cost of overseas transportation has played serious havoc with manufacturers, agriculturists, exporters and traders, as well as causing unemployment in industrial circles, and is also adversely affecting communities which otherwise would be fairly prosperous.


William Lyon Mackenzie King: Hear, hear.


Henry Herbert Stevens: The Prime Minister says "hear, hear". The other day my right hon. leader pointed out that there was serious havoc played in the industries and in the prosperity of the citizens of this country. The Prime Minister took three hours to try to persuade this House and the country that my right hon. leader was all wrong.
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William Lyon Mackenzie King: No. I said
that notwithstanding the fact that conditions were bad, they were much better in Canada in some particulars than in the United States.


Henry Herbert Stevens: They must be pretty bad over there.


William Lyon Mackenzie King: They are.


Henry Herbert Stevens: It is rather strange to find upon what grounds they consider our rates unfair as compared with those obtaining in the United States. If the United States have better rates than we have and their rates are bad, and this report says that these conditions are because of rates, then the rates in the United States being low must be the cause of their being in a worse condition than we are. The Prime Minister's proposals will not bear examination. He knows that quite well. He sought to imply in this House the other day, that conditions were excellent. I merely read this to show that one of his chosen henchmen differs from him in this regard.
By the way, I notice that this refers to the department of the Minister of Trade and Commerce (Mr. Low). He says that his files are filled with this sort of correspondence, and I was wondering when I read it, how the minister had the hardihood to issue that famous advertisement that Canada had turned the corner.
These schedules to which I have referred furnish the grievance which is claimed on behalf of Canada. I want to refer to the wheat situation and this is of intense interest. May I say to my hon. friends who are seriously interested in arriving at some proper solution of this problem, that wheat, flour, sugar and cattle have never been under the conference rates? They are not controlled by this alleged combine at all. They are excluded from it and are free from these rates.


Alfred Speakman: On what authority is that statement made?


Henry Herbert Stevens: No one will dispute it.


Ernest Lapointe: Oh, oh.


Henry Herbert Stevens: Will the Minister of Justice dispute it?


Ernest Lapointe: I am laughing at the
authority quoted by my hon. friend.


Henry Herbert Stevens: The Minister of Justice is, perhaps, one of those happy individuals that can see a joke in almost any tragedy, but he will not take the responsibility of saying that I am wrong in the matter.


Ernest Lapointe: No, but the hon. member's authority seems rather poor.

Mr. STEVENS. Does it? I can give further authority.


Ernest Lapointe: All right.


Henry Herbert Stevens: If the minister had given me time, I would have done so, but I ask him: Will he dispute my authority, my own statement? He will not. He knows better. I ask the Minister of Trade and Commerce, his colleague: Am I right or am I wrong in asserting that wheat, flour, sugar and cattle are exempted from the conference rates? He can accept the advice of my hon. friend behind him. Not one of them will dispute it. They know perfectly well I am right. I do not see the hon. member for St. Lawrence-St. George (Mr. Marler) in his seat, but I know that he would at once confirm my statement.


Thomas Andrew Low: The burden of proof rests with my hon. friend.


Henry Herbert Stevens: This is delightful. Will
the Minister of Justice bear the Minister of Trade and Commerce out in that statement? I appeal to him. He is the legal authority.


Ernest Lapointe: I certainly concur with
my colleague that he who makes an assertion must prove it.


Henry Herbert Stevens: I am not a lawyer, but I will venture this opinion, that the Minister of Trade and Commerce has got the cart before the horse; he has it reversed. It is not my business to prove my authorities at all. If my hon. friends dispute my authorities, it is up to them to show that I am wrong.


Some hon. MEMBERS:: Oh, oh.


Henry Herbert Stevens: There goes the Minister
of Agriculture with a laugh.


Mr. MOTHERWELL:: I never heard such a doctrine in my life.


Henry Herbert Stevens: I repeat that wheat, flour, sugar and cattle are not, and never have been, included in the conference rates. I state further that I have this from shipping authorities both in Montreal and in other sections. I am not going to go any further in regard to quotations.


Samuel William Jacobs: As a matter of information, would the hon. gentleman tell me if there are any fixed rates with regard to the commodities which he has just mentioned?


Henry Herbert Stevens: No.


Samuel William Jacobs: There is competition?


Henry Herbert Stevens: Certainly there is.

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Samuel William Jacobs: Will the hon. gentleman
quote his authority for that?


Henry Herbert Stevens: Yes-myself. I am going to give my hon. friends some facts in connection with the matter. In 1923, from Montreal, there were 200 tramp steamers and 598 line steamers. The tramp steamers carried 48,600,000 bushels of wheat or 42 per cent, and the line steamers carried 65,000,000 bushels of wheat or 58 per cent. In 1924, there were 367 tramp steamers and 570 line steamers. The tramp steamers carried 94,700,000 bushels of wheat or 62 per cent, and the line steamers carried 57,600,000 bushels or 38 per cent. My figures will be slightly different from those of some of the shipping interests of Montreal, because my figures are the harbour board figures. There may be a slight variation, which is accounted for in this way, that the shipping bodies, in their report, deal with the exact amount that was handled out as of certain dates, while the harbour board may deal with slightly different dates. This may make a difference of a few bushels, but the difference is so slight that it is not worth mentioning.
As regards cattle, in 1923, there were 28,966 shipped and in 1924, 41,892. If my hon. friends want my authority, I have in my hand in regard to both of these items,
9 p.m. the customs reports which I secured from the Customs department presided over by the hon. member for Three Rivers (Mr. Bureau). This is the authority I am quoting. I am not going further into details, but what I want to make perfectly clear is this: First, no one will question this, that tramp steamers are not members of the combine. The tramp steamers from the port of Montreal carried 62 per cent of the wheat. Giving my hon. friends, for the moment, the pleasure, if they like, of questioning my authority regarding the wheat being outside of conference rates, at least the quantity of
94,700,000	bushels carried by tramp steamers last year was outside of the conference rates. They must admit that, although they would not admit the other. The point I want to make is that about one-half of this wheat- the quantity varies from year to year; sometimes it is more, sometimes less-is American wheat brought in early in the season through the port of Montreal, and it is, perhaps, the most valuable freight carried by the Canadian National and the Canadian Pacific, but more by the Canadian National than the Canadian Pacific. Does the government propose to subsidize to the extent of $1,300,000
a year Petersen steamers to carry American grain to Great Britain?


William Lyon Mackenzie King: I will answer
that at once. Under the contract with Sir William Petersen, the government controls the rates and designates the commodities, and
the government intends to confine its rate reductions under the agreement with Sir William Petersen to Canadian products.


Henry Herbert Stevens: Very good. As a matter
of fact, the agreement, as it is now drafted, does not say so. It does, as to the rates which I shall deal with in a moment.


William Lyon Mackenzie King: The agreement has not all the details in, but I was putting my hon. friend right in a matter on which he was astray.


Henry Herbert Stevens: I rather suspected that.
I rather suspected that the government would be anxious to get this agreement to a private committee away up somewhere so that they could trim it up in order that it might be a little more presentable.


William Lyon Mackenzie King: The agreement will have to pass just as it is. It cannot be trimmed up.


Henry Herbert Stevens: What about the commodities to which my right hon. friend refers?


William Lyon Mackenzie King: The agreement gives the government the right to control the
rates and to state on what commodities it shall apply, and the government intends that it shall apply only to Canadian products, merchandise and consumption generally. I am speaking in the name of the government to my hon. friend.


Henry Herbert Stevens: My right hon. friend
stated a moment ago that this agreement stands and that not a letter of it can be changed.


William Lyon Mackenzie King: It does stand.


Henry Herbert Stevens: Well, that agreement does not give the government the power to determine the commodity.


Mr MACKENZIE KING:: The agreement gives the government the power to control the rates and the government intends to see to it that wherever the rates give any advantage that advantage will be given to Canadian produce and other commodities and will not be extended beyond Canadian commodities.


Henry Herbert Stevens: Here is a dealer in
Montreal, say, who buys a lot of wheat stored in one of the elevators there. That wheat is partly American and partly Canadian wheat,
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and he owns it. Is the government going to say that this particular man shall have the special low rate and that this other man shall not have it? After all, we put our finger on the very crux of the whole business, the absurdity of it, when we deal with this point. And let the, Prime Minister bear in mind that ten ships will make no great impress on the traffic out of Montreal alone, to say nothing of Halifax, St. John, Quebec, Vancouver, Victoria and Prince Rupert.


William Lyon Mackenzie King: We shall see
how the arrangement works with ten ships and we can add to the number if necessary.


Henry Herbert Stevens: I take my right hon.
friend's word for that, and we shall "wait and sea". And that is another point which I may touch upon. This arrangement is so elastic that the government may extend the number of ships to a hundred and may spend $10,000,000 a year in the enterprise. The Prime Minister nods his head, and that is precisely the danger of the whole thing; at the whim of a minister this agreement may be enlarged until it obligates the country in tremendous sums. And what for? To benefit some designated shipper, to favour some particular port or route, and in consequence to involve this country in endless discord between shipper and ship owner.


William Lyon Mackenzie King: I hope my
hon. friend will not think I am trying to interrupt him; I simply want to confine him to the facts. He has noticed in one of the clauses that the agreement is subject to the approval of parliament; the agreement will be as parliament approves it. And any subsequent agreement will be presented to parliament for approval; it will not be left to the whim of any minister.


Henry Herbert Stevens: But the Prime Minister
assured me a moment ago that not a jot or tittle of the agreement was subject to change. Where do we stand? One moment we are told that not a letter of the agreement can be changed and the next moment we are informed that the agreement may be amended and a subsequent agreement brought in. As a matter of fact, that is the very point we are disputing, that the agreement as it stands will not be approved by parliament.


William Lyon Mackenzie King: That is what
the hon. gentleman wishes; it is not what the House wishes.


Henry Herbert Stevens: We shall see what the
House wishes, and we will take care that the House is given an opportunity to express

its views on the matter. I turn now to the question of immigration, in regard to which the report has much to say. It declares that the charges for immigrants have been greatly increased, and I admit that. It may be that the charges for immigrants at the present time are unreasonable; I am not disputing that point. But I would point this out. I have seen immigrant ships come to this country for twenty-five or thirty years and I know what the accommodation on the present liners to-day is, and in the light of my experience I want to tell the House that there is no comparison between the state of affairs now and what it was at that time. As everyone knows, it is impossible to expect immigrants to come to Canada to-day under the conditions that prevailed twenty-five or thirty years ago, when immigrants were housed like cattle. In the second place, the costs have risen. Whether or not they have so risen as to justify the present rate, I am not in a position to say, but I do assert that it is unfair to suggest that immigrants can be carried at the rates that were charged twenty-five years ago. But this point is more important still: the rates that obtained say twenty years ago applied at a time when there were literally millions of immigrants coming across the Atlantic. Let me give the figures. In 1913 there came to Canada 303,000 immigrants as compared with 108,000 in 1924, while the figures show that in 1913 there came to the United States 1,079,000 as against 395,000 in 1924. In other words, the United States, by an act of congress placing a limitation upon the number of immigrants that may be admitted to that country, has restricted immigration to such an extent that it is now less than a third of what it was twelve years ago. And Canada by its process of selected immigration, with which policy, generally speaking, I wholly agree, has confined its immigration to about one-third of what it was in 1913. And you cannot expect the same rates to be charged to-day when the traffic is only one-third of what it was formerly.
Now I come to the question of the remedy which the government proposes. The government proposes ten ships, and I would ask hon. gentlemen to bear in mind that from Montreal last year there sailed out nine hundred and thirteen vessels, while from Vancouver there were over a thousand, so that these two ports account for over two thousand vessels. And the government intends putting on ten ships, which probably will make about fifty or sixty trips in the year. Is it reasonable to expect any serious impress to be made on the shipping of the country by such a service as this, when we reflect that two ports

alone account for some two thousand vessels? And in addition to that, consider Halifax, St. John, Quebec, Victoria and Prince Rupert. It seems to me that any proposal of this kind, if it is to be effective, must apply to all ports in Canada alike, and at the present time this is limited to Atlantic ports.
I apprehend that someone may question me and I had better state my authority; the Minister of Justice (Mr. Lapointe) may insist upon that. In paragraph 4 of the preamble to the agreement I find that the government has thought it wise to adopt such means as may be deemed expedient and necessary to "such supervision and control of trans-Atlantic freight rates", and so on.
Why should the government abandon the Pacific coast when we are told in the report that the combine is world-wide and covers every sea and trade route? Why, the picture drawn by Preston is one that would wring the heart of any credulous person who did not know who the author was. But if this combine is world-wide, why should not the government apply the agreement to Pacific as well as to Atlantic ports? Why limit the agreement to the Atlantic? And I emphasize once again the fact that ten vessels applied even to the one port of Montreal will prove inadequate. The Prime Minister a moment ago referred to the character of the ships. I have a brief comparison to make and I invite his consideration to it. In the first place, in the schedule covering the type of vessels contemplated, I find that the particulars are "without guarantee." Do the Prime Minister and his government realize what that means? The Prime Minister says that nothing can be changed ; this agreement stands as it is. Well, if it stands as it is, these specifications of the ships are without guarantee, and there is no reason in the world why Petersen should not vary them one way or the other at his whim and fancy. Let me compare them briefly with the present Canadian Government Merchant Marine ships. The Petersen ships, "without guarantee," have a gross tonnage of 5,000 while the merchant marine vessels, twenty-five ships, of the 8,100 ton class, have a gross tonnage of 5,751. The net tonnage of the Petersen ships is 3,500; of the Canadian Government Merchant Marine 3.550. And, by the way, net tonnage is the test. The speed of the Petersen ships [DOT]-unguaranteed, mark you-is 11 knots; the speed of the Canadian Government Merchant Marine ships on a six-mile trial trip was HI knots. Repairs to the Petersen ships, I am informed by men thoroughly competent to advise in the matter, owing to the unique construction of their internal combustion en-
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gines can only be made in Great Britain in virtually the one place where they are now built; that is, the cylinders of these engines are made of a peculiar steel that is not kept in stock in other yards. Consequently these ships will find great difficulty in securing engine repairs on this side of the water. The Canadian Government Merchant Marine ships are more or less of a standard type and therefore can be repaired in any port throughout the world. A great deal of stress is laid upon the value of internal combustion engines because of the saving in fuel. But it is well to bear in mind that owing to the fluctuating price of fuel oil many oil-burning ships today are being converted back into coal burners.
I am not speaking of the fast passenger ships, but of this class of cargo boat. The Petersen ships will have a grain capacity of 580,000 cubic feet as against 447,000 cubic feet of the 8,500 ton Canadian Government Merchant Marine boats; but the difference is not very great, and as regards our 10,000 ton ships the capacity is about the same as that of the Petersen ships.
Now let me deal briefly with the cost of this proposal. A ten-year period with principal and interest amounts to an expenditure of over $17,000,000; a 20-year period, with principal and interest compounded, amounts to $46,200,000. The government are asking us virtually to commit the country to an expenditure of some $17,000,000 over a period of ten years. But the Prime Minister says that if he and his colleagues think the contract is working out successfully they may extend it indefinitely; at any rate, there is no limit in the agreement. What are we asked to do this for? For the alleged purpose of smashing, as the Minister of Trade and Commerce says, the North Atlantic combine. This measure will plunge the country into excessive expense. This is no time for us to indulge in experiments that will cost the taxpayers large sums of money. Infinitely better would it be to apply this sum annually to debt reduction, although it may be a small sum in comparison with the national debt, rather than waste it in an abortive effort to control ocean freight rates in this manner.
The Preston report upon which the government rests its case is prejudiced and unfair, and bears all the earmarks of an effusion from a narrow and jaundiced mind; nor does any utterance upon any subject by this author carry any conviction or respect in this country. This may sound a little harsh, but I want to say it very frankly. Certain men may be very clever, they may be useful in elections to pull their party out of a difficult corner,
73G
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but because of that qualification they are not necessarily fitted for a quasi-judicial position such as this investigation called for.


William Lyon Mackenzie King: Is my hon.
friend taking advantage of the privilege of parliament in making that statement? I hope he will repeat it on a public platform, and so give Mr. Preston a chance to answer him.


Henry Herbert Stevens: I am very glad to waive any parliamentary protection in regard to that statement. I would very willingly submit this agreement to any judicially minded person as a basis for my contention. I affirm and reaffirm my contention that this whole report is permeated with prejudice and bitterness and bears abundant proof that its author had prejudged the case that was before him for consideration. As a matter of fact, the Petersen agreement is a case of heads I win, tails you lose. There is no penalty in it for Mr. Petersen at all. He can abandon this trade route any time he likes, and the only recourse the government has is to notify him that the contract is terminated. It is the most absurd thing I ever heard of.


William Lyon Mackenzie King: What will Mr. Petersen get out of it if he does not perform his contract?


Henry Herbert Stevens: Mr. Petersen draws his subsidy from month to month.


William Lyon Mackenzie King: After he has performed his service.


Henry Herbert Stevens: Of course; but after he has performed his service from month to month he draws his subsidy. The government having tied themselves up hand and foot under this contract, Mr. Petersen may abandon it if he is not satisfied with the results. He may see more lucrative trade routes somewhere else, to Australia, South Africa, India or any other part of the world, he may make a contract with others for ten years and abandon this contract, he may pull his ships off the route at Liverpool. And what happens? Here is the penalty clause, Mr. Speaker, that this lawyer, whom the minister referred to as the greatest lawyer in Canada-and we will find out later who it is-has inserted in the contract:
If at any time after the expiration of the eighteen months mentioned in paragraph 1 (c) the contractor should fail to carry on the said service with the full complement of ten ships, the minister may by notice in writing call upon him to supply the deficiency within a delay of three months, and in default of the contractor's doing so within such delay, the minister may terminate the contract by notice in writing.
When Mr. Petersen aJbandons his contract and leaves us high and dry, I picture the
| Mr. Stevens.]
Minister of Trade and Commerce sitting down and inditing a terrible letter to the ship owner telling him that if he does not immediately restore the service he will lose his contract. The man having already abandoned the contract is under no penalty whatever! In the meantime we have been paying him diuring the period of the experiment, $1,300,000 a year, and at the same time we have disturbed and upset our trade arrangements and our shipping connections, and we have driven every tramp steamer out of the business.
Now, if the House will pardon me a little humour after so much seriousness. The Minister of Trade of Commerce and his friend the author of this report, remind me of the story of two Irishmen-


Thomas Andrew Low: I might inform my hon. friend that Mr. Lafleur is the 'lawyer who drew the contract.


Henry Herbert Stevens: I have a very high regard for Mr. Lafleur, but I have a shrewd suspicion that this agreement, whoever may have gone over it afterwards and revised it, was signed in the Old Country before the minister ever returned here.


Thomas Andrew Low: My hon. friend's suspicion is not well-founded.


Henry Herbert Stevens: Probably not. The minister referred to Mr. Petersen as chairman of the Bureau Veritas. I like to accept suggestions when they are given to me, and I find it rather interesting to note that Mr. Petersen who is going to supply these ships without guarantee'-it is so stated in the contract-is to preside over the committee which will determine whether these ships are or are not in accordance with the schedules.
Now for my story. There were two Irishmen, the story goes who met a bob-tailed wildcat and chased it for a while, and finally drove it up a tree. Mike sent Pat up to shake it down. Pat shakes it down, and Mike catches it. Pat shouts down, "Have you the wildcat?" "Yes," cries Mike "but come down and help me let it go." I can imagine, Mr. Speaker, the Minister of Trade and Commerce and Mr. Preston scurrying around and finally treeing this bob-tailed wildcat and Mr. Preston then taking the safer course and going up the tree to shake it down. The minister now has the bob-tailed wildcat in his hands, and he is praying for heaven's sake for someone to come and help him let it go.
The government's objective is a free movement of commodities and a lowering of charges. Can anyone suggest for a moment

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that the government's remedy is conducive to a freer movement of commodities, that with ten or twenty or even thirty ships it is going to make any appreciable impress upon the North Atlantic conference or upon the ships in that conference?


Andrew Ross McMaster: Mr. Speaker, it perhaps may be fitting as I had the great honour of being chairman of the committee that looked into the matter of ocean freight rates some two years ago, if I detain the House for a little while in consideration of the matter which is now before us.
The speaker who has just resumed his seat (Mr. Stevens) stated that he did not take our report in perfect faith. In making that statement he reflected to a certain degree on certain very honourable and distinguished members of his own party, because the two reports which were brought into the House by this committee on ocean freight rates were unanimous reports, concurred in by the former Minister of Agriculture in the government of my right hon. friend who now leads the opposition, concurred in by a gentleman of the Conservative party who at one time, I understand, occupied the important position of Minister of Agriculture in the province of Ontario, and by two other distinguished and hon. members of this House; and in reflecting upon the report the hon. member for Vancouver Centre (Mr. Stevens) was reflecting upon the wisdom or patriotism of these gentlemen as well as upon the wisdom or patriotism of other members of the committee. I would be prepared to leave the appreciation of the conduct of our committee and of the actions of the chairman in regard thereto in the hands of my fellow members of that committee who belong to the Conservative persuasion. There was not from the beginning the slightest attempt to make political capital out of the matters which came before us for investigation. I would gladly bear testimony to the work which all the members performed on that committee. We worked literally night and day in endeavouring to get at the facts, and with no other endeavour, and when we had got some of the facts concerning certain phases of our inquiry-our time was not sufficient to enable us to go fully into all the multitudinous matters brought before us,-we made two reports on the question of ocean freight rates. Those reports were concurred in unanimously by all the members of the committee; they were concurred in without cavil by all the members of this House.
Now the gentleman who has just taken his seat does not state that there is not a North 47



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Atlantic conference or combine, but he rather objects to the word combine; he prefers the word conference, and though he does not exactly praise it, he would give us to understand that this combination of shipping interests is really rather beneficial than otherwise. It is true that it may require some slight correction here and there, but according to him, its virtues far outweigh its vices. Here again he falls foul, I will not say of a more distinguished member of the party which sits in the comer immediately at your left, Mr. Speaker, but he falls foul of the gentleman who occupied in a previous administration the very honourable and onerous position of Minister of Finance, a gentleman who in earlier, I will not say happier days, was the chairman of the Board of Railway Commissioners for Canada, and who looked into this matter and reported upon it to the government of the day; and his view of the situation was precisely the same view to which this committee arrived at.
I could not expect the House to listen with patience to me if I went over all our report, but perhaps I may be permitted to draw the attention of the House to certain of its salient features. We brought in two reports, one on the 23rd of April1, 1923, and one on the 18th of June, 1923. In our first report we set forth that there was a combine, that there was a North Atlantic and U.K. Conference Eastward-Bound-I think that is the full title of the organization-which met every month in New York and there agreed on certain rates, and that there was also a committee of various lines trading out of Montreal called the Weekly Liner Committee. The matter in which the Liner Committee operated was as follows-I read from our report:
The general rates were set at the North Atlantic and U.K. Conference in New York, but for the purpose of united action in regard to these and other rates, a weekly meeting was held, at which representatives of all the steamship lines attended. At this meeting, rates were agreed upon, and no member of the line had the right to depart from the rates so established without conferring with, and warning his competitors of his intention so to do. An earnestly worded expostulation would be directed by one member to another if this line of conduct was not followed.
Theu we pointed out in our report that the operation of this conference had brought about this most extraordinary result:
The government of the United States forced the Shipping board, which manages the United States governmentally-owned steamers, to make a very low rate for the transportation of flour to Europe, a rate stated by the shipping companies to be below a commercial rate. This rate applied only to flour ground in the United States. To meet this rate, the North Atlantic Conference lines established at a given'moment a rate of 15 cents per 100 pounds on flour ground in the

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United States, while they maintained a rate of 19 cents per 100 pounds on Canadian flour-a very substantial differential against our Canadian millers.
That rather disposes of the appeal made by the hon. member for Vanoouver Centre (Mr. Stevens) that flour was always free, that flour was never controlled by the conference. As a matter of fact, the hon. member was mistaken in that regard.
In our second report we dealt somewhat thoroughly with the history, not of the shipping rings, but with the history of the investigations which had been made into the shipping rings. We examined with care the report made by the Royal Commission on Shipping Rings in 1909; that is the report to which the hon. member for Vancouver Centre has referred in his somewhat extended remarks. But what he drew the attention of the House to was the report of the majority of the committee, and this majority was made up largely of men who were not unconnected with the shipping business. They therefore gave to themselves a very high certificate of character. But the members of that committee who were less intimately connected with the shipping rings were somewhat more critical and the labour member of the committee, a gentleman by the name of Madison, made a very strong reservation and came out whole heartedly with the view that shipping combines were on the whole evil and not good things. I think we were very fair in our report in this matter. We gave a succinct and I think a fair account of the findings of all three classes of commissioners who subscribed to that report. We gave the findings of the majority of the commissioners and even the majority who investigated into the shipping rings were not satisfied with the way things were going on. Their solution was that groups of shippers should combine in associations that could face the powerful shipping ring: that one group should be organized to "faire face," as we say in the language of the province of Quebec, to present a united front against the association of the ship owners. But we also brought before the House the findings of the minority of the commiisioners. Now, the minority of the commissioners found along lines which I think tend to appeal to the sen.-ie of the people of this country. It certainly appealed to the sense of the hon. member for West York (Sir Henry Drayton) when he looked into the matter. This is what the minority of the commissioners saad:
All monopolies are liable to abuse, to a greater or less extent, unless they are strictly limited either by nature of the case, by legislation, or by some form of supervision.

And again:
There is. of course, a presumption against a monopoly in any branch of trade being beneficial to the community.
Again:
The benefits of the organization which they (toe
shipping companies) adopt for the purposes of their business must be valued, mainly with reference to its effect, not on the shipping companies, but on the general public.
I should not like to detain the House in setting forth all the conclusions to which this minority came, but I may be allowed to draw attention to a few of them. I suppose we are all agreed that it is a good thing to have cheap freight rates either on land or on water. But freight rates should not be driven down to such an extent, either on land or on water, that there is not a fair and reasonable return for the capital invested. I think that is reasonable, I think that is fair, unless there is too much capital invested, in which case it might be quite proper that rates should be driven down until the capital in the industry represents fairly the earnings earned upon it. But with that proviso I think I am within the sense, the common sense of this House, that we are all on common ground in saying that with provision for a proper return for capital it is paramount under our present economic system that goods should move freely from place to place, and that freight rates should be brought down to what would be a fair return for the public service rendered. That being the case I think we will all agree with the statement that:
The system was introduced in the first instance with the object of raising rates or preventing their fall and diminishing competition
It has been successful in raising or keeping up rates;
The public have as a rule, to pay higher rates of freight than they would pay in an open market;
The system has been injurious to "tramps", the strongest element in the British Mercantile marine, and it leads as to them to waste and to higher rates of freight.
The system tends to waste in various other directions owing to the manner in which the rings are constituted;
There is no satisfactory evidence that the saving in cost, if there be any. under the system of shipping rings, exceeds the waste which is due to that system;
The system tends to inflate the amount of tonnage and consequently the amount of capital invested upon which interest has to be paid.
I think that is merely an example of an economic law which is of almost universal application, namely-that if you artificially- whether by restriction of competition, or otherwise-increase for the time being the reward of capital in any certain given line you will induce more capital to flow into that line; that therefore you will produce an excess of capital in that line; that excess of capital will aim to earn money for itself; that rates

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and prices will increase, and in the long run the business which it affected will be hurt and that capital which has entered into that artificially stimulated channel will be hurt as well. It seems to me a grateful thing to listen to the energetic and eloquent paean of praise in favour of an absence of artificiality put forth this evening by the hon. member for Vancouver Centre. I would invite him to follow that wholesome line of reasoning into many other spheres of social, political and economic thought.
After dealing with this long report on shipping rings we dealt with the report made in 1913 by the hon. member for West York (Sir Henry Drayton) who was then chairman of the Board of Railway Commissioners. His findings were practically the findings of the minority who had examined into the shipping rates. I will not say that he found in his report everything that they found, but I think that the conclusions which he arrived at were based, in large measure, upon the same reasonings and he came very much to the same conclusion that they did. I know that we based ours, in making our report, in no small measure upon the findings of a commissioner who went over there with judicial experience for the purpose of finding out the facts without, I may say, the slightest inclination to veer either to the right or to the left, and I think that it is a complete answer to those who would depend too strongly upon the favourable findings of this British commission if I might quote the words used by the hon. member for West York when he said in his report "Notwithstanding the information which I received from the conference lines, I am still of the view that an investigation should be held".
I am at one with the hon. member for Vancouver Centre when he says this matter is of the greatest difficulty and that it behooves us all to get at the real facts of the case. I cannot imagine a wiser step than that intimated by the Minister of Trade and Commerce this afternoon that this resolution shall be placed before a special committee of this House for investigation into the matter, and that before this committee there will be opportunities given for all interested parties to make their representations known.
May I just say that this should not be a matter upon which men should differ on party lines. I cannot see that there should be any difference of opinion between patriotic Canadian citizens as to the advisability of getting the cheapest freight rates that we can and all the facts we possibly can in order that our 47 V
ways may be guided wisely and justly in the matter.
In our report we dealt with the finding of the Dominions Royal Commission which has been referred to by the minister in his address to the House this afternoon, and we also drew the attention of the House to the fact that there had been a similar movement in the United States, a similar attempt made to control freight rates by that country, and that the great publicist Lubin who founded the great Institute of Agriculture at Rome, had given us his opinion that it was vital for the agricultural interests of the world that some international body should control freight rates on the seas, because the question was in effect international and) not national. Mr. Lubin in his report to congress shows how those who control the freight rates of the world control the supply of the staple commodities of the world, and how, if they are in league with speculators they may mulct not only the consumer but also the producer. That is one of the matters that we dealt with in our report, and I feel that that report, in view of the unanimity in which it was prepared, offered and accepted, might be accorded full faith and credit, even by leading members of the party which sits immediately to the left of the Speaker.
I have dealt at some length with the report itself, and I will now proceed to answer a few of the arguments which were advanced by the hon. member for Vancouver Centre (Mr. Stevens). The statement was made that the concern of British shippers was not our concern. and that British shippers might well be left to look after themselves. If that statement had been made by a nationalist of the province of Quebec I know what the Toronto Telegram would have said the next morning. What was the object of this country some time ago in giving a preference to British goods but to encourage trade between ourselves and the British Isles, I could not help remarking with a certain amount of interest-and my hon. friend will pardon me if I say also amusement-the emphatic statement made that if return cargoes could not be obtained freight rates must be paid both ways on any shipment. The hon. leader of the Progressive party (Mr. Forke) interjected' a question as to how that attitude of mind comported with the desire expressed in some influential quarters to get rid of the British preference; but when that question was suggested my hon. friend wisely gave silence for a reply.
It seems to me that perhaps a few words may be spoken concerning the arguments used by the hon. member for Vancouver Centre
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[Stage Direction]
that what we must do is to devise a policy which will divert trade from its natural channel and into unnatural channels. That was in effect his argument when he pointed out that we had what he would be pleased to call an adverse balance of trade with the United States, and that we should endeavour by legislation to change that adverse balance of trade. Now, Mr. Speaker, we do not buy anything from the United States unless we can get better value for our money by so doing. We buy nothing from Great Britain, Germany, Austria or Italy unless those who are charged with the purchase of it think they can get the best value for their money. It is preposterous nonsense-and I say it in all kindness-to think you can effectively divert trade from its natural channels by legislation. Let me give the House an example which I gleaned from the pages of the report of the Economic conference which was attended by the Prime Minister and the Minister of Railways the autumn before last. The representative of India said that after the war they had endeavoured to direct their trade in raw hides from Germany to Great Britain. They had apparently in India-at least so I gathered from the report-a large trade in light hides, and prior to the war these light hides had been going largely to Germany. They had an export duty on these hides of 15 per cent. They cut the duty to Great Britain down to 10 per cent, and maintained the 15 per cent duty on hides sent to Germany; but the hides went to Germany just the same. Why? Because that was the natural place for them to go, because trade had worn that channel, because, as the representative from India said, the German people seemed to be the only people who were able as a good business venture, to work up or deal in these light hides. We had at the time when the National Policy was introduced into this country a very much smaller trade with the United States, relatively to the trade with England than we have to-dlay; but with the introduction of the National Policy, which was supported by the slogan 'Reciprocity in trade or reciprocity in tariff," we found that relatively to our trade with Great Britain our trade with the United States increased. After 1896 we gave a large preference to British goods, but our trade with the United States increased proportionately faster than did our trade with Great Britain. In 1911 we were given an opportunity, which may not come again for many- years, the responsibility for the rejection of which will have to be borne as a crushing burden on the shoulders of the distinguished members who sit on the immediate left of the Speaker.

But even after that rejection, trade with the United States relatively kept increasing and increasing. It is folly to fight against eoonomic law and the facts of geography, and the sooner the country realizes that, and instead of trying to fight against economic law and to fight against geography, tries to take advantage of economic law and to take advantage of geography, the sooner we will arrive at a prosperous position.
In his remarks dealing with the report of this special committee investigating agricultural conditions, the member for Vancouver Centre made this statement:
Wheat, flour, cattle and sugar were never affected by the conference rate whatever.
I have not had time to look up sugar, and I am prepared for the purpose of the argument to grant that my hon. friend is right about sugar, but he is wrong about the three other commodities.
Henry Herbert Stevens: Will the hon. gentleman
allow me to interrupt?


Andrew Ross McMaster: Yes.


Henry Herbert Stevens: The hon. member is not
quite right. I said that these articles were not now and had not been for some time affected by the conference rates. They were at one time, because I am quite aware of the fact that the United States government interfered in regard to flour, so that my hon. friend is quite right in regard to that.


Andrew Ross McMaster: Perhaps my hon. friend is not quite so wrong as I thought he was. I did not understand him to say that it was merely at the present time that these were not affected by the conference rates. I do not know whether they are now affected by the conference rates, but I know that after the representatives of the lines in Montreal had endeavoured to hide from your committee the existence of their combination and combine, and that after we examined into the matter, investigated and cross-questioned them, we found out these facts and, perhaps, if they had conference rates on wheat, flour and cattle, in the past, it is quite possible that even if they do not have them on these articles now, they may easily have them in the future.
In connection, however, with cattle, there is not much room for difference of opinion, because I hold in my hand a reply of the steamship lines engaged in the Canadian north Atlantic trade to a report made by Mr. Preston, and on page 21, I read as follows:
During 1921 cattle were being shipped to continental
ports at rates varying from $75 up to $100 per head whereas conference lines were only charging $40 to the

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United Kingdom during the same period, and during the same year this rate was reduced to $30 and was subsequently reduced to the present basis of $20 on cattle weighing over 1,000 pounds, and $18 for cattle weighing 1,000 pounds or under.
This is not the rate of one particular line. This is the rate stated by all the lines to *which the rates apply, and I think it is fair to say that that is a conference rate on cattle at the present time.
Let us look at the question of flour, because quite an eloquent appeal was made for support of the attitude 'assumed by my bon. friend, which after all, was an attitude rather of criticism than of constructive statesmanship, to members who sit immediately opposite me, because wheat and flour had not been controlled by conference rates. I have in my hand the evidence which was taken before the special committee on Agricultural Conditions. In part 1, at page 143 I read as follows:
By the Chairman:
Q. Have you a fixed agreement on other agricultural products?-A. We have certain understandings as to rates on some commodities.
Q. What commodities?-A. Oh, on butter, provisions-
Q. Flour?-A. No, there is no fixed rate on flour. We
have what might be called a gentlemen's agreement as to rates on flour.


Edmund James Bristol: What date is that?


Andrew Ross McMaster: This gentleman is Major Curry and he gave his evidence on March 15, 1923:
Q. What is the difference between an "understanding", and a "gentlemen's agreement", Major Curry?-A. There would be difficulty. If any particular flour shipper came to me and wanted a lower rate, and I thought there was justice in his argument and I felt we could afford to carry flour at a lower rate than we were quoting, I could very easily arrange to get him that rate.
Q. How would you arrange to get him that rate? Just give it to him yourself, or would you confer with others before giving him an answer?-A. On account of the understanding we have, I would have to give notice to the other steamship companies.
Q. What other steamship companies would you have to give notice to in such cases?-A. Do you wish me to name the companies?
Q. If you please.-A. The Canadian Pacific, the Cunard line, the Donaldson line, and the Canada Steamship line.
Q. The Canadian Government Merchant Marine?- A. I do not think, sir, they are in the agreement, but I believe they are represented, and perhaps could answer that question themselves.
We had some interesting evidence about flour from a Mr. Cunningham and I read from his evidence at page 195:
Q. Here we find the minutes of a meeting held on the 7th of February at 11 a.m. It does not say, but that would be in 1920:
Grain rates:-The lines present agreed to maintain a rate of forty cents per 100 pounds on rye, corn, barley and wheat when the latter is released, with fifty cents per 100 pounds on oats, with the exception
of McLean Kennedy and Co., who stated they would have to cable their principals, but would recommend their adopting these rates.
That applies to wheat rather than, to flour, but I may as well deal with wheat now, and there is plenty of evidence in the testimony given by these gentlemen that there was at that time and had been previously a conference rate on wheat as well as on flour.
There was also a rate on a great number of other agricultural commodities:
Q. Mr. Curry gave us to understand that the rates charged upon butter, cheese, live stock, chilled meats, apples, canned fruit and vegetables were all rates established after conference between the different lines?-A. No. I think he excluded the live stock.
Q. Well, apart from live stock, you would agree with him?-A. Yes. As far as we are concerned. We feel we should follow to a certain extent the rates that are considered satisfactory by the other lines.
I will not weary the House with further references to the evidence. I have merely this to say, that I think if anyone with an unprejudiced mind and a fair degree of intelligence will sit down and read the evidence whidh was given before the special committee, he will come to a conclusion without the slighest doubt that there
10 p.m. was a combine and that there was a fixing of prices, not by the mere law of supply and demand, but an artificial fixing of prices. I am a great believer in the law of supply and demand in regard to ocean transportation as well as in regard to other things, but you do not have the law of supply and demand when those who have the supply combine together, no matter what the demand is, to put up the rates. One of the great difficulties in the situation is this. The hon. member for Vancouver Centre (Mr. Stevens) is perfectly right when he says that to have a schedule of vessels sailing and vessels arriving settled beforehand, is of real and vital interest to the commerce of the country. Of course it is, but it is also of reai and vital interest to the commerce of the country that a man should know that not only will a certain ship leave on a certain day, but that no advantage will be taken of his necessity of shipping the goods by the transportation company in arbitrarily raising the rates, because that is what has happened and that is what is likely to happen under the present arrangements. Is this a good thing for the shipping companies themselves? I very much doubt it. We see more shipping in Montreal to-day than is needed to supply the demand. There would be far more goods shipped away from Canada and brought into Canada if we could have in many regards reasonable freight rates. There are some
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freight rates which are perfectly reasonable; there are others which are not reasonable. I am quite willing to admit, for the sake of argument, and I think it is a fair proposition to put before the members of this House, that operating costs of vessels have increased 100 per cent in, say, the last ten to fifteen years. But I am told that they have not, as a general rule, increased more than 100 per cent. Therefore, when one finds as one does certain rates increased from, not 100 per cent, but 200 per cent, 300 per cent, and, in some cases, 400 per cent, that is prima facie evidence of extortion.
A fair day's wage for a fair day's work applies to the workman, it applies to the administrator, and it should apply to capital. And those who endeavour by artificial means to get unjustifiable profits will find in the long run that they hurt not only those who are the direct sufferers but themselves as well. Are there any people in the world who are really more interested in the development of this undeveloped half of the North American continent than are the shipping people? When you consider that this country is able to support not only twice, but three times and perhaps four times the number of industrious, hard-working people whom we have in Canada to-day, is there any interest in the world, I ask, which is more concerned with the development of this Dominion than are the shipping people? Take the question of immigration. It is quite true that the immigrant accommodation on vessels to-day is incomparably better than what it was twenty years ago. But does it cost more than twice as much now than it did ten years ago to carry third class passengers? I doubt it very much, and when you find that third class rates have gone up three and four and five times what they were before, then I say that such a state of affairs calls for investigation. And if the investigation establishes the fact that there is extortion it calls for a remedy. There is one thing I believe a committee such as was foreshadowed by the Minister of Trade and Commerce this afternoon will do: it will enable us to get at the facts. And if whatever committee is appointed will work at the facts with the same devotion, the same lack of party spirit and animated with the same desire of arriving at the truth, the whole truth and nothing but the truth, as animated the previous committee, then I think a useful work can be accomplished.


Edmund James Bristol: The matter before the House, the
proposed contract with reference to ocean transportation, is one of the most important 
problems that will come before parliament this session. The question of ocean transportation and the virtue or the misconduct of the North Atlantic conference or combine, or whatever hon. gentlemen may choose to call it, has been a matter which the Canadian people have had under consideration for, I suppose, twenty-five years. The chief thing in their favour, to start with, is the fact that they are principally English and mostly respectable people. So respectable are they that they even had until a few days ago the steamers belonging to the government of this country; and I believe they still have steamers belonging to the United States working under their flag as part of the conference, to say nothing of such ordinary people as the Canadian Pacific Railway Steamships, the Cimard line, the White Star and others.
To begin with, we might reasonably take it that at the hands of the Canadian people these gentlemen have a right at all events to fair consideration on the question whether they are or are not really a combine for the purpose of fixing ocean rates. They should be given the same fair consideration which the railway commission gives to the two railways of this country in the matter of fixing rates for their traffic. If these shipping interests have been operating as fairly as the railways have done, then no one has any reason to complain; and if on the other hand they have not been fair, if the farmers and the manufacturers of the country have not been properly treated, then we have a right to quarrel with them and possibly to do something to remedy whatever injustice might exist. I will not render any verdict on that question, inasmuch as we have Mr. Preston on the one hand and, on the other, the reports which have been referred to. I have received through the mail the reply of the steamship' lines engaged in the Canadian north Atlantic trade, and apparently they differ very materially from Mr. Preston on many important matters. I did notice one thing which I considered of great importance to the farmers, and as they are the largest shippers of Canada, on the whole, the truth of the statement was one I wanted to verify. When the minister was speaking I therefore asked him a question as to whether grain, flour or cattle rates were fixed by the conference, and in this connection I would quote a statement that appears on page 5 of this document I have received: Furthermore, in the list of eastbound rates promulgated by the North Atlantic conference, no rate or agreement is made in respect to grain, flour or cattle, these rates being absolutely open.

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If they are absolutely open and are continued absolutely open it is naturally a matter of great importance to the farmers of the country. Of course, it is easy to understand why they should be and are open, because on these particular commodities, such as cattle, there are tramp steamers in Montreal fighting the battle. The transportation question in Canada presents some difficulties on the Atlantic side, in Montreal and Quebec, that do not exist in the great port of New York. There is on the Atlantic ocean what is commonly known as the Atlantic triangle. That is to say, a ship will go from London or Liverpool to South America, thence up to New York, and if it gets a cargo it naturally will not want to go up the St. Lawrence particularly in October and November. If, however, a cargo is not available and the prospects are not bright, then there is a plenitude of shipping out of Montreal, as happened last year, when the tramps were in the proportion of two to one in opposition to the liners which are alleged to be a combine or conference.
Now, we must have had fairly good transportation rates in the last two or three years, for if I am correctly informed the great port of Montreal within the last three years has doubled the transportation that has proceeded from it.


An hon. MEMBER:: What does that prove?


Edmund James Bristol: That proves that at all events the rates were such as to encourage the shipment of goods at a profit, for otherwise people would not have exported. Of course, one difficulty in our shipping business naturally is that while we have a good cargo to go to England we often have a small cargo coming back. On the other hand, vessels going from England to South America or even to Australia usually have good return cargoes. So that when all is said and done the thing that really makes the difference is the number of cargoes which the ships carry.
So far as the present question is concerned, the real point before us is, not whether there is or is not a combine, but whether the contract which the government presents for our consideration is a sensible contract, a useful contract, a contract which, while it may not do very much, may make the combine, if there is a combine, sit up and take notice that we do not think they are treating the Canadian people fairly and that we will show them what can be done.
As regards the government, if they can do anything to improve transportation rates between Canada and the Old Country, then
of course they are doing something of great public benefit. But I have read the contract with a good deal of care and I have no doubt it was drawn by the distinguished lawyer whose name was given to us. But the drawing of a contract is one thing and the making of it another, that is to say, the composition of what you put into it. I have no doubt Mr. Lafleur has drawn an excellent contract; but I want to tell my distinguished friend the Prime Minister (Mr. Mackenzie King) that I think it has been put over this government in a very shocking fashion. And I will explain the reasons for that view. I may be wrong, but I will explain my position, because I do not think the Prime Minister proposes to have something injurious accomplished if he can help it.
Now Sir William Petersen is only personally liable until he forms a corporation. That is perfectly clear. Once he has done that the clause to which I am referring absolutely releases him from liability; and very sensibly so too, for the modem man prefers to put a ship under a corporation; then should she run down another ship he is not liable for damages if there is carelessness on the part of the crew. It is a common practice to form a shipping company on these lines. But I am pointing out to the Prime Minister that the distinguished gentleman on whom 'he is relying is absolutely free from liability the moment he forms that corporation. Forming corporations as a matter of modern business has many qualities which are worth considering. For instance, under this contract if on the 15th of June he has borrowed or rented six ships and put them in operation, on the 15th day of July he starts to get his monthly payment of the $1,333,000. or thereabouts. The two ships which he is to deliver under the contract must be ready on the 1st of August, but he is under no penalty if he is not able to make delivery. If he writes, "I am very sorry, but the people who are constructing these ships have not got them quite ready," you have got to go on paying him.


William Lyon Mackenzie King: Oh no.


Edmund James Bristol: I am not asking the Prime Minister to accept my view. We will assume that you have not to go on paying. But on the 1st of August before he starts one of his real boats you have to begin paying him.


Mr MACKENZIE KING:: May I interrupt my hon. friend?


Edmund James Bristol: I will read the clause my right hon. friend refers to later.
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William Lyon Mackenzie King: Read it now, please.


Edmund James Bristol: I will, if it will give you any comfort. This is the clause:
And it is mutually covenanted and agreed between the parties hereto that the subsidy payable to the contractor in the preceding paragraph is based on the operation and maintenance of a service of ten ships and the subsidy aforementioned shall be increased or reduced as the case may be in proportion to the number of ships operated and maintained by the contractor in the service aforesaid from time to time and such increase or reduction of subsidy shall be added to or deducted from the monthly payments hereinbefore provided for in paragraph two.
Is that the clause?


William Lyon Mackenzie King: No.


Edmund James Bristol: Is there another later on?


William Lyon Mackenzie King: Yes, let my hon. friend read clause 2.


Edmund James Bristol: Certainly.
And His Majesty for himself, his heirs and successors hereby covenants and agrees with the contractor, his administrators and assigns that the contractor well and faithfully performing all and every the covenants, agreements and stipulations hereinbefore set forth-
Not afterwards, but hereinbefore set forth.


William Lyon Mackenzie King: Yes.


Edmund James Bristol: 
William Lyon Mackenzie King: Does not that make it quite clear that he is to get no payment until he performs the service? He is to be paid monthly as he performs the service.


Edmund James Bristol: If the service starts on the 15th of June he would be entitled to his first payment one month later.


William Lyon Mackenzie King: On the six ships and no more.


Edmund James Bristol: I should not like to agree with that.


William Lyon Mackenzie King: That is the point.


Edmund James Bristol: 
William Lyon Mackenzie King: I cannot quite follow this point. My hon. friend says that Sir William Petersen has made a great contract, and is going to make a lot of money. On the other hand, I understood him to say that if any of these ships in the combine attempted to reduce rates, they would be ruined.


Edmund James Bristol: I did not say they would
be ruined. First of all, I do not believe there is a combine in the sense that it is a combine to restrain trade. I have too high an opinion of the Canadian Pacific and of these other
lines to believe they are doing anything more than trying to get a fair rate which will keep them going. There may be mistakes made, just as there have been in the fixing of rates on our transportation lines in this country; there is a little one, for instance, on the Crows-nest. pass; but I do not believe for one moment that the men who are running that North Atlantic conference, the best brains in England, the people who have made Great Britain, and who provided the ships to win the war- I do not believe that body of men are pirates or that they are desirous of charging a rate that will be ruinous to the people of Canada; they would be crazy to do it. They must try to give transportation at reasonable rates in order to get the products of this country as cargo for their ships, and if the people do not, get a reasonable rate they will not ship their goods.
Coming back to the Petersen contract, I say that these modem ships, which are good, will certainly be able to carry just as cheaply as the ships of the Atlantic conference. All right. Now you say that the Atlantic conference is making money. So they are, I hope; they would not go on if they did not, but Sir William Petersen can cut his rate down to the amount they have made and charge that much less rate, and still have at the end of ten years his ships and $430,000 of annual profits for ten years. That is what he would have, and1 he need not be liable for one cent if his contract is a failure. In that case he can bid you good-bye. But if his contract is a success he takes the money. In the old' contract in 1899 he had to put up some money as a guarantee.
I come now to the next stage. Sir William Petersen gets his contract, and the government are going to fix the rates. Now the government of this country have no more knowledge, in my humble judgment, than I have of fixing what ought to be the rates for transporting the trade of this country across the ocean in ships of this kind. Therefore they will have to select, as they did in connection with the railways, one, two or three men to say what shall be the rates that this new company which will be formed shall charge, and a company, of course, will be formed because Sir William Petersen will never leave himself open to liability; it would be foolish for him to do so; he does not have to. So whatever rates this company has to charge will have to be fixed by gentlemen to be selected by the government. I do not know who around Montreal has brains enough -they may be there-to fix ocean rates the world over, or between here and Great Britain, taking insurance, transportation and
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all other factors into account; but no doubt you can get the men if you pay for it, and that is an added charge to what this thing is going to cost.
Now when you have the rates fixed, it is perfectly obvious as has been said already that the ten ships are a mere bagatelle compared with the shipping that is engaged in carrying our trade across the ocean. What they can carry is a joke relatively to what has to be carried. Now who is going to get the benefit of the joke? Which of you gentlemen sitting to my left belonging to the Progressive party are going to have the good fortune to get your goods on these ships at a lower rate? How is it going to be decided? Is it going to be done by lot, or how? Is the space going to be given to particular friends, or to the Conservatives, and is it going to be done by advertising or how? Everybody in Canada will want to ship by those boats if they are from one to three per cent cheaper than the others; yet these ten ships cannot commence to handle our trade. My advice to the Progressive party is that they should see they get the first chance. I do not see much chance for the manufacturers of this country getting any space on these ships.


Mr. MACDONALD (Pictou):: How many ships does my hon. friend think should be put on?


Edmund James Bristol: I have not expressed the view that any ships should be put on. I am only criticising the particular contract before us. I have not found the slightest fault with the government for endeavouring, so to speak, to beat the lion in his den and destroy him, if there is a lion; and that, no doubt, would come out upon investigation. We can have the three gentlemen from New York representing this combine come down here, and they will tell us that the one thing in the world they love to do is to give Canadians the cheapest freights in the world; and I hope they will from now on. But what I do say is that this particular contract, in my humble opinion, and with all respect, is a gold brick so far as we are concerned. It is an extremely valuable contract for Sir William Petersen if he builds the right kind of ships, and he has no liability. Secondly, it gives such a small percentage of the people of this country a chance to get their goods on these ships at a reduced rate, whatever that rate may be; and I hope the government will be clever enough in appointing people and get a reduced rate.
But that is not all that Sir William Petereea makes. I have had a slight experience in

shipping, and I will give you a little suggestion. In case Sir William Petersen gets the contract, he may as well get all there is out of it. If the Petersen line operates, the government should get a rakeoff on all the activities, including commission on supplies, repairs, particularly the charges on which there is five per cent-viz: on charters, time charters, freights and all the other known perquisites that fall into the willing handis of a shipping agent who puts up nothing but his brains. Most of these transportation companies have a special company, and one set of friends will furnish the supplies, and make something out of that, and another the repairs, and so on. Sir William Petersen is a very experienced man in transportation, and no doubt he will have his supply company and get his share on supplies and repairs, and we have the evidence now that the engines that will be used in these boats can only be repaired in London, and that is pretty close to home.
I am not going into any further detail in this matter. I say that the question is a very vital and important one, and this contract cannot commence to solve the problem. The people who want space on these ships will have to fight each -other for it, and I do not know what will happen to them. On the other hand, the gentleman who happens to have the ships, the owner of that stock, has no loss; he makes a large amount of money, and I should think he would be very happy in the proposition. But the contract is not going to solve the problem of ocean transportation for the people of this country. I cannot say at the present moment that I am able to give any solution of real value, but I would say that this government ought to be fairly well posted during the last two or three yeans as to how the conference does its work. You have government owned ships which are much larger than those which are to be put into operation. Government owned ships which have belonged to the North Atlantic Steamship conference for a number of years. Surely it would be possible to have the officers of the mercantile marine called and examined as to whether there is or is not a combine on the three things which I have mentioned-wheat, flour and cattle. It is surely very easy to get at that information, and it ought to be equally easy to get at the rates charged.
The carrying of live stock is a very important matter to shipping companies. I do not know whether the Petersen company are to provide any special facilities for the transportation or not. In my humble judgment the farmers of this country are absolutely

Ocean Shipping Rates
protected at the present time. To-day the Liners axe having much difficulty to get cargoes; when they cannot obtain sufficient other cargoes they put in grain to fill up the space. Both liners and tramps operate from the port of Montreal to ports of the United Kingdom. Last year 153,000,000 bushels of grain were shipped from that port and more of that grain was carried by tramps than by liners.
I cannot see that this contract is going to help our people to get lower transportation rates. It may help a few but at the expense of the Canadian tax payers. Doubtless the matter should be investigated, and if you appoint a committee to go into it it ought to be possible to secure the attendance of some distinguished people and to secure the facts and no doubt some good may result from the investigation, but not from this proposed contract.


Mr. HARRY LEADER (Portage la Prairie):: I want to take this opportunity of making a few remarks in support of the live stock industry, and to point out how that industry is affected by high transportation costs. The Preston report deals with the cattle industry, and it makes this comment:
The tragedy of the cattle industry must be largely laid to the determination of the North Atlantic steamship combine to keep the ocean rate at an exceptionally high figure.
In regard to the question of prices the report says:
In January, 1923, the White Star S.S. line quoted a rate of $15 per head, since which time it has ranged largely from $20 to $25. It is claimed by the steamship companies that the $15 rate was a " distress rate." Shortly afterwards, however, the rate was fixed for the season at $20.
This proves that even the cattle rate is in the hands of the conference. I do not rise for the purpose of censuring the government for taking the action proposed here in order to secure cheaper transportation rates. I would rather feel like censuring them for not taking action sooner. I have on frequent occasions deplored the fact that the government have not undertaken to give us better transportation rates as I think perhaps they could have done. Resolutions have been passed by different live stock organizations throughout this country, in addition to the protests made on the floor of this House, at the failure of the government to take action. As far back as 1921 the following resolution was passed at the ninth annual convention of the Western Canada Live Stock Union:
Be it resolved that this Western Canada Live Stock Union in convention assembled, while appreciating the voluntary reduction in freight rates on live stock by railways, urge upon the federal government the imperative need of a reduction of the cost of transportation on live stock to pre-war levels consistent with ithe drop in prices for live stock which the producer has been compelled to accept, and suggest for their immediate and serious consideration the utilization of the merchant marine service reported to be now lying idle in port as one means of alleviating this condition.
I had the privilege of attending the convention of the Western Live Stock Union at Calgary this year when a similar resolution was passed unanimously. I also attended the meetings of the Stock Breeders of Manitoba and a similar resolution was passed there also. So I say, that the demand is becoming insistent on the part of the live stock breeders of Canada for the government to take some action along this line. It has been claimed that the live stock industry is in a deplorable condition and that contention is true. I have some figures here that will prove how the industry has gone back and deteriorated in the last five years. The following table shows the extent to which our shipments to Great Britain and the United States have declined:
Year	No. of head
1920		 500,216
1921		 295,410
1922		 207,735
1923	(approximately)	 210,000
1924		 262,680
There was a little increase in the shipments of 1924 due to the fact, I am sure, that the farmers becoming disgusted and discouraged with the disappointing results from this industry had sold off much of their breeding stock.
Now, I maintain that agriculture has never had the support and attention that its relative importance to the nation has demanded. The live stock industry is the most important factor in permanent agriculture. Britain recognizing this fact has always paid careful attention to its live stock, and still remains the pure bred nursery of the world. We read in the agricultural papers of Royalty itself being seen often in the show rings leading a prize beast bred on their own farm. The Breeders Gazette has taken exception very often to the fact that men in authority in America have not paid much attention to the live stock industry. This year we find that President Coolidge made the first trip of any United States president to the International Fair at Chicago. The time has come now when we would like to see the Prime Minister of this country attending many of our agricultural fairs, and I am sure we would be delighted to see him leading round the ring some prize animal. We can produce the cattle that Great Britain requires. She wants nothing but good stuff,
Ocean Shipping Rates

.and we can deliver the goods. In substantiation of this statement I should like to say that at the International Fair at Chicago Canadian breeding cattle won thirty-four prizes. Among that number I believe were 9 firsts, and 3 grand championships. We won no less than nine prizes in the fat cattle class. There is a most wonderful market in the Old Land .when we consider last year that it bought $160,000,000 worth of cattle from Ireland, whereas we succeeded in selling the Motherland only a little over $8,000,000 worth. Therefore it behooves this parliament and this government to take action immediately to try and save this great industry.
When the cattle embargo was finally removed we expected a great trade to develop and we had an assurance-in fact I believe it was advertised-that the White Star line would charge a rate of $15 per head for cattle shipped to the Old Country. Previous to the war, if I remember correctly our cattle were transported to the Old Country for $7.50 per head. We were much surprised when, instead of $15, the rate was advanced to $22.50 at which figure it now prevails although it is quoted at $20. While the farmers, ranchers, and business men of Canada have done everything possible to foster trade and build up this great industry, the shipping barons of Montreal and New York have planned deliberately a combination, charging excessive freight rates, thus hampering and almost strangling our promised trade in export cattle. We have in Canada a national railway, and a government merchant marine. We have the cattle suited to the British market, and in Britain we have a market. We have everything, indeed, to build up a great trade. Yet we are the victims of a combination of commercial blood suckers that are bleeding the farmers and live stock men white. The efforts of the government to relieve the situation is being watched with concern by the live stock breeders of Canada, and it is to be hoped that those efforts will meet with success. One very important phase of this agreement is that it takes no cognizance of the possible trade that will develop in the Orient; it seeks only to regulate the Atlantic rates. It was my privilege while attending the convention at Calgary this year to listen to an address delivered by Mr. Craig, Deputy Minister of Agriculture for Alberta, who spoke of the steps taken to develop trade with Japan. The government of Alberta has sent special commissioners over theTe, and I believe that the Canadian government also has trade agents in the Orient who also assist in that great work. The important fact was brought out by Mr. Craig 
that there is a market in Japan for our cattle. He told us the first shipment from Vancouver to Yokohama cost him $75 per head. He succeeded in getting a reduced transportation rate of $50 per head, and, by the way the ship that took the cattle over at $50 a head was one of the Canadian Government Merchant Marine. I asked him if they got good service, and he said everything was first-class and that the cattle arrived in good shape. The rate has been reduced to $37.50 a head, and everything points to a development of a great trade with the Orient. We now have even Japanese importers coming to Canada. I think one came two weeks ago and bought 250 head of cattle for export to Japan. I read in the papers a statement that another importer had purchased over 500 head for shipment to Japan. Therefore I believe there is a great possibility of building up a trade among the seething millions of the Orient. I was told, and I know it is a fact that the Japanese are a proud nation. They have found out by experience that they can increase the stature of their soldiers by feeding them on a meat diet, and no doubt they intend to eat more meat as well as flour in Japan.
A lucrative and prosperous live stock industry in this country will solve many of our problems. It will solve the problem of immigration which has been mentioned frequently to-night. If hon. members will forgive a personal reference, I will show them how that will increase employment and will increase the immigration to this country. A few years ago, as my father before me, I was a wheat miner, as we are termed. We did not keep any live stock on the farm outside of a cow or two which furnished us with milk and butter. Realizing that our farm must be built up on a system of mixed farming, we got a herd of cattle. Formerly I used to do the chores myself in the winter time, but since I made the change I employ two men all the year round, besides employing others in the busy season. The cattle industry will increase employment in this country, and a great industry can be established. I intended to deal with the possibility of utilizing the merchant marine to take care of this trade, but I fear I would weary the House if I took up more time. I just mention the fact that in going over the tonnage of the ships appearing in Hansard yesterday I find thirty-six of 8,000 tons register. These are almost as large as the Petersen ships. It seems to me the government might undertake to sell or lease these vessels to Sir William Petersen to engage in this trade,

Questions
rather than have him build new ships, because in that event our ships might be scrapped or tied up, and left lying idle in the harbour. I desire to state again that the people in western Canada and indeed in the whole of Canada are looking forward with great concern to this project, and we hope that the government will be successful in giving us relief from present excessive rates. I will withhold my support of this proposed legislation, Mr. Speaker, and adopt a policy of "wait and see."
Mr. CLARK moved the adjournment of the debate.


William Lyon Mackenzie King: If the hon.
gentleman wishes to occupy more than ten minutes, all right.


John Arthur Clark: Ido.


[Stage Direction]
Motion agreed to.
[Stage Direction]
Civil government-Public Works, salaries and contingencies, $689,655.
William Alves Boys: Is it the desire of the minister to proceed very far to-night? As a matter of fact two or three members on this side of the House expected to be present when these particular estimates were under discussion, and if it is proposed to continue for any length of time I would like to communicate with these hon. members.


Mr. KING (Kootenay):: I do not think we intend to go very far to-night. We might pass this item.


William Alves Boys: I am quite aware there is no hard and fast rule, but there is a sort of understanding that, except for special reasons, the House will rise at eleven o'clock. One of our clocks shows twelve minutes to eleven, and another shows six minutes to eleven. It hardly seems worth while to proceed to eleven o'clock, but if we are going to sit till half past eleven or twelve I should like to get in touch with the members referred to.


John Warwick King: There is no intention of going on, under the circumstances.
Progress reported.
On motion of Mr. Mackenzie King, the House adjourned at 11 pun.
Wednesday, March 4, 1925