1932-11-09

[Stage Direction]
. Hon. HUGH GUTHRIE (Minister of Justice) moved:
That when this house adjourns on Thursday the 10th day of November, 1932, it stand adjourned until Monday the 14th of November, 1932.
* Mr. WILLIAM DUFF (Antigonish-Guys-[DOT]borough): Mr. Speaker, I have no abjection [DOT]to the motion carrying, but it seems to me that in view of the fact that a number of hon. [DOT]members are here from eastern and western *parts of Canada, members who will have to [DOT]remain in Ottawa for four days, namely, Friday, Saturday, Sunday and until three [DOT]o'clock on Monday, they should receive some [DOT]consideration. I suggest therefore that if this *holiday on Friday be put into effect-and [DOT]I have not the slightest abjection to it-that

Questions
our daily sittings should be longer. Instead of adjourning at eleven o'clock I think we should sit until at least one o'clock in the morning.
Some hon. MEMBERS:: No, no.


Some hon. MEMBERS:: Hear, hear.


[Stage Direction]
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk).

Mr. POULIOT:: How many postmasters were dismissed for political partisanship in the county of Temis-couata:	(a) from December 1,	1924, to
August 1, 1930; and (b) from the latter date to September 30, 1932?


Mr. SAUVE:: (a) 3; (b) 10.


POST OFFICES CLOSED IN PROVINCE OF QUEBEC
Mr. POULIOT:: 1.	Have any post offices been closed in the province of Quebec since the month of August, 1930?
2.	If so, what post offices, in what respective counties were they located, and on what date was each post office closed?


Mr. SAUVE:: 1.	Yes.
2.
Post office-Electoral district-Date of closing
Blais-Beauce-12-9-30.
Montreal Sub Office No. 4-Cartier-27-8-30.
Windigo-Portneuf-19-8-30.
Clapham-Megantic-30-9-30.
Henderson Vale-Megantic-30-9-30.
Les Hauteurs-Terrebonne-8-10-30.
Lower Ireland-Megantic-30-9-30.
Millfield-Megantic-30-9-30.
Montreal Sub Office No. 34-Laurier-Outre-mont-8-10-30.
Ribot-Hull-20-10-30.
Grand Remou-Rimouski-20-10-30.
St. Ignace du Lac-Berthier-Maskinonge- 4-10-30.
Joyal-Drummond-Arthabaska-29-11-30.
Grand'Mere Cite-Champlain-3-1-31
La Montagne-Megantic-24-11-30.
Berry er-L'Islet-26-1-31.
Mailloux-Bellechasse-19-1-31.
Painchaud-Kamouraska-31-1-31.
Cann-Champlain-21-2-31.
Montreal Sub Office No. 24-Laurier-Outre-mont-4-2-31.
Shapley Creek-Hull-1-4-31.
Arthurville-Bellechasse-6-4-31.
Chambord Est.-Lake St. John-31-3-31. Crawfordville-Megantic-31-3-31.
Dessaint-Kamouraska-31-3-31. Detour-du-Lac-Temiscouata-23-3-31. Farnham Centre-Brome-Missisquoi-4-4-31. Gatico-Champlain-25-3-31.
Gaudette-Pontiac-30-4-31. Kamouraska-aux-Cotes - Kamouraska - 31-3-31.
lies de Mai-Charlevoix-Saguenay-30-10-
30.
Escuminac Est.-Bonaventure-1-6-31. Montreal Park Avenue-Mount Royal- 1-5-31.
Extension Sub Office.
Post office-Electoral district-Date of closing Montreal Sub Office No. 90 A-Hochelaga -11-4-31.
Ville Real-Rimouski-1-6-31.
Avon-Megantic-1-6-31.
Montreal Sub Office No. 78-St. Denis- 23-1-31.
Ruisseau Plat-Berthier-Maskinonge-6-6-31. Quebec Sub Office No. 10-Quebec East- 31-5-31.
Riviere des Caps-Kamouraska-1-8-31. Tache Ouest-L'Islet-1-8-31.
Fraser's Point (summer office)-Chateau-guay-Huntingdon-14-9-30.
Dartigny-T emiscouata-20-7-31.
Lacasse-Dorchester-6-7-31.
Leverrier-L'Islet-1-8-31.
Montreal Bout de Pile, sub office-Maison-neuve-27-7-31.
Montreal Sub Office No. 82-St. Denis- 20-7-31.
Chandonnet-Megantic-17-8-31.
Custeau-Megantic-17-8-31.
Isle Verte Sud-Temiscouata-1-9-31. Lalement-L'Islet-1-7-31.
Low-Wright-30-7-31.
Low Station-Wright-30-7-31.
Mailhot-Megantic-17-8-31.
Mille lies-Argenteuil-14-8-31.
Montreal Sub Office No. 110-Maisonneuve -8-1-31.
Pidgeon-Megantic-17-8-31.
Red Mill-Champlain-1-9-31.
Savoie-Megantic-17-8-31.
St. Camille Station-Bellechasse-6-7-31. Bellefeuille-Compton-30-9-31.
Bourbon-Drummond-Arthabaska-1-11-31. Eagle Depot-Pontiac-20-10-31.
Fournier Siding-L'Islet-15-9-31.
Hazel Land-Argenteuil-3-10-31.
Petit Begin-Lake St. John-12-10-31.
Abana-Pontiac-31-10-31.
Anse au Griffon Est.-Gaspe-9-10-31.
Miron-Pontiac-17-11-31.
Hotel Bigaouette (summer office)-Quebeo-Montmorency-30-9-30.
Questions

Matalik-Matane-30-11-31.
Pointe aux Trembles West-Quebec West-* 2-12-31.
Asselin-Dorchester-21-12-31.
Chibougamau-Lake St. John-8-1-32. Lafayette-Bellechasse-11-1-32.
Laganiere-Portneuf-1-1-32.
Malvina-Compton-31-12-31.
Riordon Depot-Pontiac-19-12-31. Grondines Est.-Portneuf-3-2-32.
Grondines Ouest-Portneuf-3-2-32. Montreal Sub Office No. 24-Laurier-Outre-mont-10-11-31.
Post office-Electoral district-Date of closing
Morency-Portneuf-3-3-32.
Rapide des Pins-Labelle-29-2-32.
Ste. Corinne-Beauce-15-2-32.
Anvers-Dorchester-5-3-32.
Arseneault-Gaspe-5-3-32.
Culdaff-Dorchester

5-3-32.
Davidson Corners-Hull-31-3-32.
Feuille d'Erable-Dorchester-5-3-32. Frechette-Megantic-1-3-32.
Lac Makamik-Pontiac-5-3-32.
Quebec, Lairet Sub Office-Quebec East- 31-3-31.
St. Achille-Lake St. John-1-3-32.
De St. Just-Kamouraska-4-4-32.
Pointe aux Orignaux-Kamouraska-4-4-32. Redmond-Quebec-Montmorency-10-3-32. Shekatika Bayt-Charlevoix-Saguenay-5-4-32.
South West Point-Charlevoix-Saguenay- 1-3-32.
Tamaraeouta (summer office)-Argenteuil- 30-9-31.
Caplan Est.-Bonaventure-5-5-32.
Montreal Sub Office No. 70-St. James- 29-4-32.
Flynn-Gaspe-15-5-32.
Les Lacs (summer office)-Labelle-31-10-
31.
Perron-Gaspe-15-5-32.
St. Achille de Montmorency-Charlevoix-Saguenay-25-5-32.
L'Anse a Giles Station-L'lslet-20-6-32. L'Anse a la Cabane-Gaspe (M. I.)-30-6-
32.
Chaumont-Lotbiniere-30-6-32.
Flodden-Richmond-Wolfe-20-8-32.
Huard-B onaventure-11 -8-32.
Jama c-Labelle-1-9-32.
McGee Camp-Terrebonne-1-9-30.
Mount Oscar-Vaudreuil-Soulanges-20-8-32. Rostand-Montmagny-1-8-32.
St. Mary's of Ely-Shefford-20-8-32.
Sand Hill-Compton-31-8-32.
Val St. Michel-Quebec-Montmorency-1-8-32.
Boisville-Gaspe (M. I.)-30-9-32.


DISMISSALS FOR POLITICAL PARTISANSHIP-COUNTY OF WRIGHT
Mr. PERRAS:: 1.	How many postmasters were dismissed for
political partisanship in the county of Wright: (a) from December 1, 1921, to December 1, 1925;	(b) from the latter date to July 1,
1932?
2.	What are the names of postmasters, so dismissed, and their respective post offices?


Mr. SAUVE:: 1.	(a) 2; (b) 4.
2.	(a) W. J. Ardies, Riviere Desert; Adolphe Lafreniere, Whitefish Lake; (b) J. B. Mer-leau, Gracefield; L. H. Merleau, Bouchette; Frank Nault, Messines; J. B. Meunier, Farm Point.


SALE OF REVENUE STAMPS
Mr. BROWN:: What commission, if any, do the banks receive on the sale of revenue stamps?


Mr. RYCKMAN:: Two per cent on excise stamps only.


UNEMPLOYMENT STATISTICS
[Stage Direction]
On the orders of the day:
Hon. H. H. STEVENS (Minister of Trade and Commerce):: Mr. Speaker, the horn
member for Winnipeg North Centre (Mr. Woodsworth) inquired about further information concerning statistics on unemployment. I have before me two copies of the seventh census of Canada, showing the wage earners in Canada at work and not at work on June 1, 1931, together with causes stated by wage earners reporting out of work. These are preliminary figures, and are supplied in response to the request by the hon. member a few days ago. I promised to get the information as quickly as possible, and I now lay two copies on the table. Copies will be ready for distribution almost immediately. When I state that these are preliminary figures I mean that subject only to slight typographical errors the information contained in the document is correct.


POTATO EXPORTS
[Stage Direction]
On the orders of the day:
Henry Herbert Stevens: Mr. Speaker, a few days
ago the hon. member for Bonaventure (Mr. Marcil) asked a question concerning the possible export of potatoes to South Africa. At the time I indicated that I had not the information at hand, but that I would endeavour to obtain it for him. Upon investigation I find that Canadian potatoes have

New Government Loan
been delivered in South Africa to points as far north as Johannesburg. These were seed potatoes. Investigation discloses, further, that potatoes may be transported to South Africa as ordinary cargo, in the ordinary way, although there is no guarantee by shipping companies that they will stand up in transport. Furthermore, the difficulty is that dealers in South Africa are not at all interested in importing potatoes, because they have sufficient for their own requirements. Steamship companies operating to South Africa and those who have looked into the matter carefully are doubtful if potatoes would stand up under ordinary storage conditions. The ocean rate to Cape Town is $11.50 per long ton, in ordinary storage, and $2.50 per hundred pounds if carried in cold storage.
A further report from department officials in South Africa outlines market conditions for eight months of the year. During that time the provinces of Transvaal and the Orange Free State are in a position to supply the whole domestic demand. For the remaining four months the country adjacent to Cape Town supplies the demand, and takes care of the market. For those reasons there is no desire on the part of South African traders to import supplies in competition with the home grown product. That, I think is the gist of the information now before me.


Hon. CHARLES MARCIL (Bonaventure):: Would the minister kindly supplement his statement with information showing our exports to other countries.


Henry Herbert Stevens: I shall endeavour to do
eo.


Mr. DUFF:: Could the minister tell us if
there is direct communication by steamship between Canada and South Africa, and if so, when are the sailings?


Henry Herbert Stevens: Monthly.


William Duff: From where?


Henry Herbert Stevens: Montreal, in the summer
and Saint John in the winter, I believe.


RADIO BROADCASTING
[Stage Direction]
On the orders of the day:
Mr. PAUL MERCIER (St. Henri):: Mr. Speaker, yesterday I asked if the report of the committee on radio broadcasting had been printed in the French language. In reply I understood the Prime Minister to state that
copies had been printed in both languages and were ready for distribution. His belief was that the supply must have become exhausted. After careful investigation this morning I find the report was never printed in the French language, and no doubt the Prime Minister misunderstood the situation. The fact is that it has not yet been printed in French. Would it be possible to obtain copies in the French language, beoause hon. members would like to have them.
GASOLINE PRICES On the orders of the day:


Mr. T. F. DONNELLY (Willow Bunch):: Mr. Speaker, before the orders of the day are called I would like to ask a question of the Minister of National Revenue (Mr. Ryckman) concerning a report appearing in the Canadian Press. The article states that though the Canadian government has abolished the dumping duty on gasoline it has fixed the price so that the Canadian importer must pay to the American refinery the wholesale price in the United States, plus the United States excise tax of one cent, or be penalized by our customs officer. Does this not mean that the Canadian duty on gasoline has been raised to about four cents per gallon instead of two and one-half cents, and that one and one-quarter cents of this amount goes not to the Canadian government but to the American refinery?


Edmond Baird Ryckman: Mr. Speaker, I am not aware of the facts mentioned by the hon. member, but I shall look into the matter closely.


Thomas F. Donnelly: I shall forward the
Canadian Press despatch to the minister.


NEW GOVERNMENT LOAN
[Stage Direction]
On the orders of the day:
Hon. J. L. RALSTON (Shelburne-Yar-mouth):: Mr. Speaker, I understand representations are coming from people in moderate circumstances who might be able to subscribe in small amounts to the current twenty-year four per cent loan, if the denominations were less than $500. I should like to ask the minister if the government has considered, or would give consideration to reducing denominations below $500, so that small investors might be given an opportunity to take part in the loan.
986	COMMONS
Imperial Conjerence-Trade Agreements


Hon. E. N. RHODES (Minister of Finance):: Mr. Speaker, the matter to which attention has been brought by my hon. friend was very carefully considered, and the situation very carefully canvassed. In the light of information and advice which came to us from banks and bond dealers as to their experience in connection with similar loans, I felt that inasmuch as this was a very low priced loan and comparatively small, it would be unwise to have smaller denominations in this issue. May I point out to the hon. member that in the national service loan the subscriptions of $100 amounted to less than four per cent of the total amount issued. Obviously it would not be practicable to have the smaller denominations issued in connection with the short-term loan. That would leave a comparatively small loan of $55,000,000 in which to participate. If there were the odd individual who wished to buy a $100 bond, he could do so, for the moment, in the open market. Of course my hon. friend will realize that next year and the year following we shall have very heavy and very large refunding operations before us in hand, and at that time it would be more appropriate to consider the question of bonds of smaller denomination. I might point out to my hon. friend that one consideration was that in connection with the national service loan- I am speaking from memory, but I think accurately-although the total subscriptions for the smaller amounts were less than four per cent of the total issue, the cost of handling the coupons, the labour employed in servicing the bonds is greater for that four per cent than it is for the remaining 96 per cent. That was also borne in mind. So for the reasons that I have indicated it was thought unwise at this time to issue the smaller denominations.


TRADE AGREEMENT BETWEEN CANADA AND THE UNITED KINGDOM
[Stage Direction]
The house resumed from Tuesday, November 8, consideration of the motion of the Right Hon. R. B. Bennett (Prime Minister) for the second reading of Bill No. 8, an act respecting a certain trade agreement between His Majesty's government in Canada and his Majesty's government in the United Kingdom.
Hon. W. R. MOTHERWELL (Melville):: Mr. Speaker, when the Prime Minister made his highly militant and denunciatory speech last Thursday, he could not have expected that he was contributing much towards shortening this debate. In that speech he

invited many hon. members to go back to their constituents and tell them that they had opposed this and that and the other thing. I do not want to take that too much as a challenge, but it was an invitation at all events, made in such a tone as to indicate that he thought we were afraid to do so. But these matters were all taken into consideration before the debate was started, as soon as we came to this house and saw what was before us. So we will have no hesitation, not only in accepting that invitation, but in this house endeavouring once more to give the reasons why we are opposed to this agreement now under discussion. AVe have been giving reasons for three weeks, some of them categorically, the hon. member for Vancouver Centre (Mr. Mackenzie) gave fourteen different reasons, in a good speech associated therewith; the hon. member for Last Mountain (Mr. Butcher) confined his statement to something like six specific reasons, and every member on this side of the house who spoke, those representing the Liberal party at all events, gave specific and substantial reasons why he could not see his way to support this agreement.
If I were confined to one or two minutes in giving my reasons I would quote from Mr. Baldwin's opening address, the words which have been quoted several times already in this debate, to the effect that there are two ways of promoting preference and interimperial trade; one by reducing tariffs between the various units of the British commonwealth of nations, the other by raising tariffs against the rest of the world. And Mr. Baldwin indicated that he would very much prefer the former way. That is exactly where we on this side of the house stand. That alone would be a sufficient reason for me By lowering tariffs you not only promote trade, you increase revenue and also make goods cheaper to the consumers of this country, and no doubt they need it. By raising tariffs against the world-and we have had a double raising of tariffs by 'hon. gentlemen opposite, not only against the world but also against Great Britain-you throttle trade, decrease revenue and make goods dearer to the people of Canada. But as I am not confined to one or two minutes I am glad of the opportunity to take up some further phases of the question.
It is a very dangerous thing to attribute motives to anyone. How are we to know the motives of other hon. gentlemen? AVe may know our own motives, but it is not safe, especially for a lawyer, to impute motives to anyone else. He is always caught up very

United Kingdom
quickly by the lawyer on the other side, and sometimes by the judge, when he indulges in such a questionable practice. I remember as a boy I often used to hear the old answer, when one imputed base motives to another: You are measuring your corn in the other's half bushel. So I am afraid the Prime Minister was measuring his corn in that other one's half bushel; in other words, judging the other party by himself. Yet I believe he did an injustice to himself by putting himself in that position. I scarcely think so ill of the Prime Minister as that. I suppose in the right hon. gentleman's practice before the courts, when he found he had a weak case the plan was to abuse the other fellow's attorney. But that was played out long ago, and I am surprised that anyone occupying his high position and with his remarkable powers of oratory and of expression should resort to that worn out and questionable method.
Another reason why we so much resent that particular speech is that the right hon. gentleman cast imputations upon our old and esteemed leader, Sir Wilfrid Laurier, that were absolutely without foundation. That point was so well dealt with by my .right hon. leader last night that I only refer to it in passing.
I am familiar with the story of the British preference, not in this parliament it is true, but by following it carefully ever since the preference was initiated in 1897. The statement made by the right hon. Prime Minister, it seems to me, was entirely apart from the facts. I could scarcely believe my ears when I heard his recital of what he represented to be the facts of the matter. You would wonder that anyone in a condition of sanity would make such a statement.
Let me turn to the two conferences that are under discussion. One links in with the other, because one is claimed to be based on the other. With respect to the conference of 1930, let us refresh our memory. I will not read much because I think the house is very familiar with the story, but just the crucial statement:
I (Mr. Bennett) offer to the mother country, and to all the other parts of empire, a preference in the Canadian market in exchange for a like preference in theirs, based upon the addition of a ten per centum increase in prevailing general tariffs, or upon tariffs yet to be created. In the universal acceptance of this offer, and in like proposals and acceptances by all the other parts of the empire, we attain to the ideal of empire preference.
Then he elaborates thus:
In the first place, the rate I have mentioned cannot be uniformly applied. The basis of the proposal is the adequate protection to industries now existent, or yet to he established.
Adequate protection, that is the basis of this offer. A few paragraphs prior to that he said:
Projects other than the one I propose have been placed before you. They have been carefully canvassed by our delegation, and, while we would avoid anything which might savour of premature condemnation, we are constrained to state that none of them can be accepted by Canada as alternatives at all likely to achieve the purpose we have in mind.
So eight days after the conference convened in London we have our Prime Minister practically issuing an ultimatum to the conference that any alternative proposals cannot be considered; his and his only must be accepted, or there is nothing doing, unless it is based upon protection.
Now turning to my right hon. friend's speech of the twelfth of October, at the submission of the resolution, after enumerating the various agreements that have been come to, there is this statement:
These agreements mark the first forward step in a definite scheme of closer empire economic association.
The first forward step. That would cause amazement, I am sure, even among the Prime Minister's followers. I wonder how many think that helps his case. A stranger in the gallery listening to that would think this was the first step towards British preferenice made by any living man or by any government. There is nothing associated with that statement to indicate otherwise. I have read it all over, and if the Prime Minister had said that this was the last backward step in the promotion of inter-empire trade, by raising tariffs against the British people and still higher tariffs against the world, I could have agreed with him. My right hon. leader went so fully into that question last night that I merely refer to it to indicate the folly and falsity of that statement. It carries its own refutation. Let us proceed:
They (the Ottawa proposals) are based upon the principle enunciated by the Conservative party before the last general election, and steadfastly supported by it from that time to the present. They conform to the general plan proposed by this government at the economic conference held at London two years ago. . . .
That is the London conference to which I have just referred. The foundation of this agreement is adequate protection, and for that reason I am opposed to it.
Let me refer briefly to another great objection that has arisen. You know, Mr. Speaker, as a party we never have been in favour of these hard and fast, cat and dog bargaining agreements. That is what we have here, if we are to believe half the evidence we hear.
98S

Imperial Conference-Trade Agreements
Another regrettable incident in connection with these discussions was the remark made by Neville Chamberlain with respect to the ties of empire wearing thin in Canada. I do not want to say anything derogatory of that gentleman, but if ever there was a foolish and mischievous remark it was the one he made. I think I am warranted in making that statement, and it was simply the result of this kind of bargaining and of endeavouring to defend its conclusions. Over in England they must make some attempt to justify themselves, and they forget that what they say there is reported here the following morning. Their remarks sound differently here. I am not going to quote what Mr. Chamberlain said; I would not be so cruel, but he intimated that the ties of empire were wearing so thin that they required something to bolster them up. Our ties may be wearing thin; all the rest of our clothes may be wearing thin, but that does not apply to the ties to which he referred. His father did not say that. His father was the author of that famous statement to the effect that the silken ties of kinship are stronger than ties of iron. That still holds true with a large body of the people of Canada who own Great Britain as their motherland.
That same gentleman, Mr. Chamberlain, made another very foolish statement. Apparently he was fearful lest the United States would tie up to us if Great Britain did not tie up first. That is a very provocative and mischievous statement, but I am not astonished at it. I do not feel like blaming him; when our own Prime Minister has indulged in that kind of clap-trap what can we expect from Neville Chamberlain?


Mr. MACKENZIE KING:: He loaded him
up.


William Richard Motherwell: That is what I think he did, and he must have been pretty well primed. This newspaper I have-the Belfast Post-is almost worn out. I am not going to harass the feelings of the Tories over there by reading very much from it, but here we have their leader all gowned and decked with honours-and well deserved honours, too- when he received an honorary degree from Belfast university. The right hon. gentleman made a speech on that occasion, and I do not see that it possibly could be termed anything other than an attempt at straight intimidation of our overseas kinsman. He said that if empire ties were not strengthened economically the old empire would blow up. The heading is "Empire Ties must be Economic." The article goes on:
(Mr. Motherwell.]
"I am satisfied," he said, speaking at the luncheon, "that if we do not avail ourselves of the matchless opportunity that we have by reason of our far-flung empire, our fate will be the fate of other great empires of the past."
We know what happened to the older empires referred to; they went to pieces, and the Prime Minister said we must tie ourselves up by means of tariffs because the other ties are gone. He continued:
While sentiment, he asserted, must always blaze a pathway, the ties that bound peoples to one another at the present day must be ties of material strands of economic strength.
But in my opinion when we have to rely upon high tariff ties of this description to tie us to the motherland the end is not far away.
Lest I may have given a wrong interpretation to these words of our Prime Minister or put a construction upon them that never was meant by the right hon. gentleman, let me refer to an editorial which appeared in the same Belfast tory paper about a week later. Apparently it took them about a week to recover from the shock. Those were astonishing statements he made, and he even brought in the famous Boston tea party as a means of further intimidation, holding it up as a spectre, as though he were saying that if something were not scon done there would be another Boston tea party. I quote from the editorial:
After the cold and didactic speeches in Belfast a few days ago of Mr. Bennett, the Canadian premier, who asserted that the old ties of blood and kinship between motherland and dominions were broken, and that if not replaced by commercial ties, "the empire would share the fate of the great empires of the past," it was heartening to hear Mr. Scullin speak of those old ties as still existent and still strong. "The unity of the commonwealth of nations," he declared, "lies in the blood ties that exist between the various parts." We would much rather take that hopeful view than the gloomy one of Mr. Bennett.
Mr. Scullin, the Australian Prime Minister, had also spoken in Belfast about the same time, and they bad an opportunity to compare the two gentlemen. Now we can understand why Mr. Chamberlain makes these nonsensical, rattle-brained statements with regard to the empire ties wearing thin. Now it is easy to understand why we resent that kind of talk, and that is what this sort -of "dog-fight" bargaining has led to. What will it be like when we have two or three more conferences? I will wager that not one of the gentlemen from abroad who attended the last Ottawa conference will attend another conference in Canada so long as the present government is in power. They will take no more chances.
It is true that in some measure Mr. Chamberlain prepared himself for the Ottawa con-

United Kingdom
fereDce. Having had some experience with the quartette of Canadian broncho diplomats who went over there in 1930, he was forewarned and knew what to expect when he came to Ottawa. So that famous and historic Import Duties Act was passed in London, and he was able to say in effect that unless certain agreements satisfactory to the United Kingdom were arrived at, those tariff schedules would apply to Canada and all the other dominions after a certain date. Personally I do not believe that he ever meant to pull the trigger of that gun, but the gun was there during all the sessions of the conference. I think that is a correct statement; the right hon. Prime Minister has said so himself. Here, under the shadow of that gun, to which was attached a time fuse dated November 15, those agreements were arrived at, reluctantly, under duress, and in the fear that something worse might happen if the agreements were not arrived at. After building the Canadian tariff wall to a prohibitive height against Britain, a brick or two was taken off in regard to textiles and other things, and we are told that this will promote inter-empire trade, although the remaining tariff is still in many instances almost prohibitive. That is what was done, as the schedules will indicate. Possibly something was secured by means of that semi-threat, because that is what it really was. I do not think they would have carried out their threat, however. The home government just now cannot afford to quarrel with all the dominions, nor can we afford to quarrel with her. They could not come barehanded here after their experience with our diplomatic quartette to London in 1930; hence the British delegates equipped themselves the way they did for the 1932 event. So much for Mr. Chamberlain.


Mr. BELL (Hamilton):: He is not dead yet.


William Richard Motherwell: I beg your pardon.


Leslie Gordon Bell: I say, he is still alive.


William Richard Motherwell: I can't hear that either, and I don't know that I am missing an awful lot.


An hon. MEMBER:: You should get out your ear trumpet.


William Richard Motherwell: We all have our afflictions, but I am glad that mine is not a rattle brain. Possibly my hon. friends opposite will think that we are putting too severe a description upon these conferences, especially that of 1930. If our delegates thereto had been drinking men I would have thought they
were all as full as goats, but they were not; they were all sobernminded gentlemen of whom nobody would suspect such cuttings up. I do not know what kind of virus got into their veins, but something did. To support this view may I call as witness a gentleman who is well known, who has been quoted before, but whom it will do no harm to quote again, to refresh the memory of the house. The writer of the article I am about to read is Grattan O'Leary. He said, with reference to the 1930 conference:
The chief effect of the conference, indeed, so far as Canada was concerned, was that Mr. Bennett, who went to England with a high ambition for imperial economic unity based upon tariffs, left London with a veiled threat of economic separatism.
Economic separation! The Postmaster General is credited in the press, and he has not denied it, with having made a speech shortly after this last conference had adjourned, indicating that if London did not accept these agreements, well, they would have to look to Uncle Sam about it. I hope he did not say that, but it has not been denied. Aren't they great bluffers, these hon. gentlemen on the treasury benches? It seems as though it were with them a game of bluff all round. What is the game in which there is so much bluffing?


An hon. MEMBER:: Poker.


William Richard Motherwell: Yes, poker, where you develop the poker face and all that. Well, I do not know much about that. Mr. O'Leary goes on:
Nor was this the end. Mr. G. Howard Ferguson, Premier of Ontario, recently appointed Canadian High Commissioner to London, committed the extraordinary indiscretion of making a vigorous attack upon the Socialist policy of the Labour government to which he has been accredited. This, not unnaturally, has added to the strained relations between Ottawa and Downing street, has made cooperation between the two governments difficult, if not impossible.
And now, because my right hon. leader spoke about the strained relations at the end of the last conference, which was infinitely worse than the first one, the Prime Minister objects very strenuously, notwithstanding that Mr. Grattan O'Leary, in connection with the 1930 conference, predicted that owing to strained relations it was almost an impossibility for these various representatives again to get together, which prediction was nearly fulfilled.
Le't me now mention another reason why I oppose these agreements. Ever since 1897 the Liberal party's policy has almost invariably been to secure these British preferences
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by a lowering of tariffs against the home government, and on the other 'hand almost as invariably our Tories have tried to secure preferences by the raising of the general tariff; and in this last instance not only by the raising of the general tariff against the world but by the raising of the preferential tariff rate in 1930 and 1931 against Britain herself. The Right Hon. Mr. Thomas referred to this sort of preference as humbug. Some people thought that his use of that word was a diplomatic blunder, but in my opinion it was the naked truth and a very happy expression. But if the first conference was humbug, what sort of language should be used to describe properly the last conference? Surely it must have been the diouble-dyed, twice-distilled quintessence of humbug, sham and pretence so far as the juggling with our Canadian tariff was concerned.
Another objection I have is this. I have been warning against imputing motives, but I can come to no other conclusion than that in this agreement under the guise of preferences, Canadian tariffs have been put up against the world and pegged there for five years; and not only have they been put up against the world but the leaders on the ministerial side, including the Prime Minister, have gone about boasting publicly that the outside world will have to pay tribute to the British Empire for the privilege of trading with us in the future. Can you imagine anything like that? Should hon. gentlemen of that description be left running at large in this critical period? Plowever, we have some hope. Judging from the corralling of some of these high tariff gentlemen to the south of us yesterday, I think we have reason to believe that gentlemen of the same type on this side will not be at large very long.
Now I will refer to the wheat question. In this regard the right hon. gentleman opposite challenged me to go back to Saskatchewan and defend the position I have taken. Well, if ever there was a piece of sham and pretence it is the wheat preference that has been extended to us. I have not heard any of the western Tories defend it yet. We had one or two very good speeches from them. We had a speech from the hon. member for Qu'Appelle, but I must say that I did not hear him defend the "world price" proviso attached to the so-called wheat preference, although I heard him upbraiding myself a Jittle bit; and the hon. member for Souris also made a good speech, but he took pains not to mention the fatal rider to the wheat preference. This is another instance of each of them

-Canada and the United Kingdom-dragooning the other. At the last moment of the conference, when everyone thought that the wheat question was settled, and word had gone abroad throughout the land through the press that there would be no wheat quotas, or preferences, lo and behold, our Prime Minister, against the advice of expert advisers on both sides of the water, insisted upon a wheat preference. From what we can gather, it was going to blow up the whole works if he insisted on that and got a real preference, because the Right Hon. Stanley Baldwin did not wish to expose his political flank to the attacks of the home Labour party and the Liberal party by leaving himself open to the accusation that he was making the poor man's loaf any dearer. Consequently we got a nominal preference with one hand, from the Right Hon. Stanley Baldwin, at the instance of our Prime Minister, and then with the other hand Mr. Baldwin took it away by saying that we must supply wheat at world prices-exactly what we have been doing for over fifty years. I wonder how many people they hope to humbug by that procedure. I will tell you what it has enabled the Tories in Canada to do. When the Prime Minister was speaking last Thursday he never mentioned that fatal rider which says that we will just get what we have been getting. That kind of preference does not amount to a hill of beans. When the Prime Minister was speaking on the resolution on October 12 he admitted that he had never promised the Canadian farmer that he would raise the price of wheat by this preference and consequently raise the price of bread in the old country. He said he believed that this measure would enable the farmers of the west to have a secure market in which to sell larger quantities. Where is the evidence of that? The only way we can sell larger quantities of wheat in Great Britain is by means of the quota. There is no assurance under this present arrangement that we will be able to sell one bushel more.
I wonder what my good friend the Minister of Agriculture (Mr. Weir) was thinking of when he did not have decided decisively the matter of wheat routings through Buffalo or other American ports. Apparently the government never thought about this matter although practically three-fifths of our east-bound wheat goes via Buffalo. According to a cablegram received from the Hon. Mr. Howard Ferguson, wheat reconsigned through the United States to England will not be given the benefit of the British preference. However, this wheat is not losing very much on that account. Such wheat is to be treated,

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however, as foreign and taxed six cents import duty before it can enter Great Britain. I am hopeful that the United Kingdom will decide not to so penalize this trade route which has been used advantageously between Canada and Great Britain for the last fifty years. The leader of the government attempts to shirk all responsibility in connection with this matter by stating that the British government has the administration of this matter.
He did not leave it entirely to the British government to rescind or abrogate the Russian treaty. If he was as careful of the western farmer as he is in giving another knock to Russia, he would have seen that our wheat would have been permitted to go via Buffalo and still be treated as Canadian wheat. This wheat will now be forced into unnatural channels via Halifax or St. John and the cost of transportation will be increased. There will be increased freight rates, canal charges and ocean rates to contend with, to say nothing of the additional storage space which will have to be provided at our Atlantic ports. As everyone knows, the elevators at Buffalo are used primarily for storage purposes. The wheat is crowded forward in the fall of the year while the lakes are still open in order to be as near tidewater as possible during the winter. I do not think there is one hon. member in this house but would favour our Canadian ports being patronized, but I, for one, am not prepared, nor can we afford, to pay four or five cents more per bushel in order to have our wheat routed that way. If we could get a reduction in freight rates to permit of it, it would be different, but we are now faced with these alternative penalties which have been imposed on us by this government in agreement with the British government. Who signed the Anglo-Canadian treaty? It was the right hon. the Prime Minister and Mr. Chamberlain and yet as a signatory to the treaty, the Prime Minister attempts to deny responsibility and places the whole blame upon the British government. He has no defence in this connection.
I should like to refer to what I would term a sin of omission, the lack of consideration of the monetary question. How can we hope to promote interempire trade when we have been piling tariffs one on top of another for the last two years? In addition to these tariffs we are faced with an adverse exchange rate which is equivalent to a duty of twenty-five per cent against all our goods entering Great Britain. It is an utter impossibility to trade under these conditions. One of the first things to do in order to improve the course of a
stream or ditch is to remove all obstructions, such as old dams, brush, logs or other debris. Sometimes it is necessary to deepen the ditch, but at other times the removal of obstructions is sufficient to increase the flow. One of the main obstructions which should have been removed in connection with our trade stream was the adverse exchange. Every animal, every bushel of wheat and every other commodity sent to Great Britain is penalized to the extent of twenty-five per cent adverse exchange, and that is one of the reasons why our cattle and hogs can scarcely find a market over there. If we were on the strict export basis in bacon now we would be getting almost one cent less than we are at the present time for our live hogs. In the face of all this the right hon. gentleman continues to spin yarns by the mile expatiating upon the wonders of this agreement.
If this exchange question could not be corrected at a family gathering of British dominions, how is it going to be corrected at the world conference of strangers to be held at some unknown date and in some unknown place? In the meantime we have to suffer. I wonder if the government has ever heard of that old saying: While the oats are growing, the horse is starving to death. I wonder if the government realizes the distressing condition of agriculture in the west? Instead of engaging in these impossible, abortive ways of improving our markets, ways which cannot help but be disappointing, the government should try to work out some plan to remedy the wheat glut situation. A gentleman by the name of C. AV. Petersen, the editor of the Farm and Ranch Review of Calgary has, in my opinion, suggested a very useful basis of solution of this problem. He recommends a world conference of the great wheat growing and exporting countries. These are the United State, Canada, the Argentine and Australia, but there is still another and that is the fly in the ointment-Russia. I believe that the suggestion put forth by this gentleman is possible of some development. Whether or not we like it, our wheat production must be reduced to near the world's capacity to consume. Otherwise the situation will continue to get worse and worse. Our carryover is becoming larger each year. I recognize the fact that no one country could afford to reduce its wheat acreage without similar action being taken by the others. Should an agreement be reached by these five countries, including Russia, I would look for something in the way of a systematic reduction of the tremendous overages occurring or increasing each year. The overage from last year added to the crop of this year, gives Canada alone
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600,000,000 bushels of wheat. Are we going to go along blindly until we become so impoverished that many farmers will not have the equipment or strength with which to put in a crop? That will be the result of the ruthless law of the survival of the fittest. What stands in the way of a solution of this problem? Russia. What stands in the way of Russia plajdng the game with the rest of the exporting countries? The attitude of this government towards Russia hitting them an embargo swat in the eye every time they get an opportunity. Russia is a nation with the largest white population in the would, trying to work out its own destiny, in a way different from ours, it is true; but if we are democratic, if we believe in self-government, why cannot we let them have the right to govern themselves in their own way? I do not believe in sovietism any more than does anyone else, buit I believe they have a right to work out their own destiny-a right which Canada claimed and exercised. A futile attempt was made to cooperate with Russia a year and a half ago. The Hon. Howard Ferguson was sent to Rome to negotiate with Russia on the wheat question. That was just a short time after we had placed an embargo on a number of her exports. What kind of setting was that to get satisfactory results? It was another hare-brained method of trying to secure something by the blasting or blazing route. Since then every Russian knows it was at the instance of Canada that this treaty between Great Britain and Russia was abrogated recently. What kind of feeling will the Russians now have towards Canada? As a matter of fact, as I see it, by again thus swatting Russia in the eye, our government have spiked the one possible chance in sight of securing joint action by the five great wheat exporting countries of the world looking towards the reduction of wheat acreages to meet present day consumption requirements.


Mr. G. G. COOTE (Macleod):: 994	COMMONS
Imperial Conference-Trade Agreements
The minority stockholders, of whom I was one, unfortunately, objected to that and we fought them through the courts in the province of Quebec. We beat them in three courts there. They took it to the privy council direct. We beat them the first time and we lost the second time. The costs amounted to about $10,000. Then they found that they had not such a good time as they thought and they came to us or we came to them-we met anyway-and they agreed to reinstate us in our stock and to pay the costs, which amounted to $10,000. A number of us accepted that offer and we got our stock back. We had lost all the dividends for five or six years. The small body that remained out did not accept that offer but they gave them two shares for one of stock and that made everything clear. They had a mill here and they could not give title to that mill unless they had everything clear. They had a mill in Windsor which is now running as an underwear factory. They had another plant in Halifax. So, you see, in so far as the maritime provinces are concerned, they closed up the mill here and did the same thing in Windsor. They did not care two straws for us. As Charlie Gordon told me, they were anxious to concentrate their business in Montreal and they have done so.
Then, I am going to omit part of the statement of the late senator and come down to the matter of the earnings of the Dominion Textile Company. His statement continues:
The last report of Dominion Textile is a very good one showing net earnings, on a business of $23,000,000 of about $3,500,000. They are now paying ten per cent. But the worst feature of the whole thing in connection with Dominion Textiles was tlie $5,000,000 of stock given by these gentlemen to themselves.
That is some of the stock about which we are so concerned.


Miss MACPHAIL:: Of the widows and
orphans.


George Gibson Coote: 
An hon. MEMBER:: Are things improving over there?


Jean-François Pouliot: It is .too bad my hon.
friend is so far away that I cannot catch what he says, but may I tell him this:	We can
wait for a change of government in this country if hon. gentlemen opposite will have the courage to tell their leader that he is wrong, that he is ruining the country, that he is destroying our trade and that he is discouraging the people of Canada with his stupid and insane policy of high tariffs. If they get courage enough to do that they will be cheered to the echo by their electors, but if they do not do so they will be swept away with the ebbing tide at the next election. I ask them to show courage and not to. be school children, to tell the Prime Minister about the misery of the people. Hon. gentlemen opposite have a real opportunity; they meet him in caucus, they can speak to him in his office or in the house, and they must tell the Prime Minister that he is ruining the trade of this country. We need a moderate tariff in order that we may exchange goods with other countries, and hon. gentlemen opposite must tell that to the Prime Minister.
The right hon. gentleman has a very strong voice; he uses it in order that people will not know that his knees are trembling. When he is afraid, he uses his voice to impress his supporters. No one should be afraid of him. He has nothing but his voice with which to impress people. He has a strong voice and a nice appearance, but that is all. Hon. members opposite should not bother the Prime Minister too much in regard to questions of patronage. They should not stay so close around him; they should remember the bees, who kill their queen with love. Hon. gentlemen opposite surround the Prime Minister; they are very close to him; they hold him so tightly that he has no chance to rest or to think. They surround him as flies surround molasses. They should give the right hon. gentleman a chance to breathe, a chance to think. He is a very clever lawyer; he honours our profession. He can think, if they will give

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him a chance to do so, but they are always around asking him to give the Postmaster General authority to cut the throats cf small postmasters.
I see my hon. friend the Solicitor General (Mr. Dupre) across the way, with a genial smile. He was far away during the last session. Now that he is here and is friendly with the Prime Minister, let him be helpful to that right hon. gentleman. Let him be one of the Prime Minister's bodyguard, so that he may help to keep at some distance those who do not give the right hon. gentleman a chance to sleep or to rest, and who are responsible for his overworking-eighteen hours a day, I believe. Surely the Prime Minister needs some sleep; he should sleep at least eight hours in the twenty-four. He should have some ti-me for rest and for meals. They must give him a chance; they must be reasonable. He may be a superman but he needs eight hours of sleep just the same. And he must eat, and relax. I say, they should give him a chance to regain his natural happy disposition. Then he will be able to think, and it will be the proper time then for hon. gentlemen opposite to make representations to their leader on behalf of the civil servants and of the poor and the unemployed. They ought to say to him, "Dear R. B., Why do you not extend your sympathy to these poor unemployed? Why do you not try to live up to your promises of 1930, when you said that you would end unemployment and that prosperity would be restored as soon as you got into power?" That would be very nice. God has always prevented me from being a Tory, and I am thankful for that, but if I were on the other side of the house I would speak exactly in those terms to the right hon. gentleman. But no one on the other side has the courage to urge upon the Prime Minister that he give some consideration to the poor, to the humble, to all those who are suffering. They have not the courage to ask him to come to the rescue of those people in order that their lives may be made happier and in order that our present troubles may be overcome. I repeat, it is because not one of them has had the courage to make such representations to the Prime Minister that he has persisted in this stupid policy of high tariffs; and it is because I regard that policy as stupid that I vote against it. I would say this to the Prime Minister's face, if he were here today, honouring us with his presence, but he is away and I must say it in any case. I am glad to have learned from him yesterday that he is reading Hansard. I hope he will continue to read it, but if he does not read it
then I should like the Solicitor General to send him a marked copy of Hansard, with those views that have been expressed in all sincerity and in fulness of heart, in order that they may bring the right hon. gentleman to his senses.


Mr. E. J. GARLAND (Bow River):: 
Mr. LAPOINTE:: You spoke intelligently
against it.


Edward Joseph Garland: One can always make fairly destructive criticism of almost any measure, as I have noticed on the part of the hon. member for Weyburn on many occasions. When it comes to casting an intelligent vote, however, I find that he does not suffer from the disability of having to determine for himself what an intelligent vote is; all he has to do is to follow the whip of his party, and he does this so consistently that he is almost a Tory in this regard. For my pai;t, I would rather refrain from voting, if I a.m to vote unintelligently, than vote against my principles. I have no hesitation in suggesting to the hon. member for Weyburn that he will find that I voted against the Dunning budget, which increased tariffs, whereas he voted for it, voting for something to which he was really opposed.


Mr. YOUNG:: I never hid behind the curtain.


Some hon. MEMBERS:: Oh, oh.


Edward Joseph Garland: 
An hon. MEMBER:: Good will.


Edward Joseph Garland: 
George Gibson Coote: Who said that?


Edward Joseph Garland: Lord
Rothermere, a man in whom, as I said a moment ago, the Prime Minister has a good deal of confidence.
Seme ten years ago we had practically no wheat trade with the orient; it was only a matter of three or four million bushels. Realizing the enormous value of the potential market there, the Alberta wheat pool, in one of the early years of its formation, sent to the orient its president, Mr. Wood, Mr. Mclvor and one or two officials. They travelled throughout all the necessary portions of Japan and into China, traversing the whole length of the country, establishing connections and acting as genuine salesmen for Canadian wheat. The result of that action and the support of our trade commissioners in these countries was that in the short period of about eight or nine years our trade in wheat with the orient was increased to the extent of 33,000,000 bushels


Edward James Young: What year was that?


Edward Joseph Garland: When our
trade was 33,000,000 bushels?-1927 or 1928. I speak from memory.


Edward James Young: What happened to our
trade?


Edward Joseph Garland: Just a
minute. Suddenly our trade vanishes. With the exception of five or six million bushels we do not ship wheat to the orient any more. We have lost the greater part of our market there. Why? We wanted to find out why, so communications were sent to our trade commissioners at Singapore and Hongkong and to our ambassador at Tokyo. They all reported the same two factors that entered into the situation. One was the depreciated value of silver and the resultant short purchasing power in oriental countries; the second and principal factor was that the re-

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quirements of the orient were being met with Australian wheat, and Australia has increased her shipments of wheat to the orient steadily year by year during the last three years. I have in my hand reports of interviews or speeches by the Hon. Herbert Marler. Speaking in Tokyo on February 5, his excellency our ambassador to Tokyo said:
At present China is purchasing large quantities of wheat from Australia which, owing to the decline in exchange rates, Australians will be able to sell as much as $4 a ton under Canadian prices.
And note: they still get a higher price in their own country in terms of their own currency than we can in Canada. Next, speaking on August 1 last at Victoria, his excellency said:
Last year Australia supplied 33,000,000 bushels of Chinese imports, while Canada shipped but 6,000,000 bushels. Canada, however, had been suffering from adverse exchange rates, the advantage lying with Australia.
So in case after case the evidence piles up in support of the position that has been taken for years by hon. members in this corner of the house, and now, I am glad to say, being supported by some hon. members to the left of the Speaker.
In connection with the cattle business it is perhaps unnecessary to rehearse the story of the last few years. The hon. member for Marquette (Mr. Mullins), who sits opposite, knows as well as I do what happened to it and why. I have in my hand the review of the Country Guide printed at Winnipeg: What's What in Western Canada. At page 3 of the issue, volume one, number 3 of April, 1932, it points out:
During the first part of the season it was a profitable business-
That is, shipping cattle to the United Kingdom.
-but with the abandonment of the gold standard by Great Britain a new and entirely unforeseeable situation arose. The paying power of the pound was reduced 20 per cent in terms of Canadian currency. This had the same effect as doubling the ocean freight rate. Heavy losses were sustained by exporters on cattle in hand.
It does not matter a particle whether all the embargoes or difficulties in regard to the shipment of cattle to Great Britain are removed, as long as this major obstacle remains in our way, until the exchange differential is eliminated, we cannot with profit move our cattle into that market. We are told by hon. gentlemen opposite and by all the exponents of the sound money policy that of course the reason they cannot accept our
suggestion to go off the gold standard, to create parity with the pound or to put our dollar even lower than the pound, is that this would enormously complicate the difficulty of meeting our commitments in New York. I want to deal with that phase of the situation because it is rather important. It is a question that we must answer if -we are going to justify our case. At the present time the total interest charges accruing in New York amount to about 8233,000,000 a year.


An hon. MEMBER:: It is more than that.


Edward Joseph Garland: That is approximately the Prime Minister's own figure given before the financial committee. I am speaking subject to minor correction. Let us say that it amounts to 8220,000,000 in interest. W'hat happens? If there is a depreciation of our currency of, say another 10 or 12 or 15 per cent, this may mean an increase in the premium we shall have to pay, to the extent of from $20,000,000 to S30,000,000. It does not necessarily follow that it should, but it may. Suppose we agree for a moment that it does, and that it means an increase in our premiums in New York to the extent of $30,000,000, I ask you Mr. Speaker, what of it? I say: What of it,-and for this reason: First of all, the improvement of trade, especially with the United States, as the result of the elimination of the effectiveness of that country's trade barriers, under a depreciated Canadian currency, would enable us to meet our commitments in New York in goods, or bills of exchange for which the goods were sold.
But even if we do not do that, suppose we eliminate everything, and say it is a straight premium of $30,000,000 more. Let us examine the exports. 'Canada's total exports for the fiscal year ending March 31, 1932, are as follows:
Agriculture	 $204,398,000
Animals	 68,798,000
Textiles	 5,512,130
Wood products	 175,740,269
Iron and steel	products.. ..	15,462,977
Non-ferrous metals	 69,072,888
Nommetallic	 13,456,701
Chemicals	 10,535,038
Miscellaneous	 13,367,251
The total exports are valued at $576,344,302. Now, it is further agreed by authorities that, provided markets remained available and were not deliberately blocked by retaliatory action, if we were to go off gold and permit our currency to shrink to by even 15 per cent, there would be an improvement in prices received by exporters in terms of Canadian
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currency of at least ten per cent and probably as high as 14 per cent. Ten per cent of S576,000,000 is $57,000,000, so we gain some $27,000,000 on the deal. We lose $30,000,000, and make $57,000,000 in improved prices for our exporters. But, Mr. Speaker, this is too reasonable an estimate. I have given the export figures, but I would ask hon. members to bear in mind that they are in part export figures on animals, animal products and agricultural products generally, and on these and most of the others the internal price figures are determined by external prices. In short the price received for exports determines that at which the goods are sold at home. So, when. I say only $57,000,000 might be added to the price in terms of Canadian currency to the home producer and exporter,
I am understating the ease. The probability is that the general level of prices of all commodities, part of which are exported, would be affected and improved. Therefore the figure would probably be very much ahead of the estimate I have made.
In support of that position I am about to take the words of a man in whom I know the Prime Minister has confidence and reliance. I am going to take the words of a man who has been quoted as an authority, again and again in this house, the words of a man who was imported by' the Prime Minister to Canada for the purpose of conducting an investigation, a man whom the Prime Minister on public platforms and in private conversations has praised again and again. I shall give the name later because I do not wish the value of his words to be lost. Listen to this:
Canada's economic dependence upon world prices is greater than ever. It was sometimes thought her decision to adhere to some fixed relation for her currency to the New York dollar as distinct from the opposite course of adopting sterling or some intermediate level rested upon the importance to the dominion of avoiding payment of substantial premiums on her heavy New York obligations. It had been said Canada could not possibly afford this premium or its general effect upon her credit. This dilemma is more apparent than real. Even if Canada left her present dollar standard and her internal price level rose, she would still have to pay her New York obligations and with gold prices raised abroad for her wheat, the relation between the Canadian dollar and the New York dollar would become immaterial for the purposes of payment.
Those are the words of Sir Josiah Stamp. Let hon. members hear them now, and think them over.


Mr. BOURASSA:: When was that statement made?


Edward Joseph Garland: I have read from a Canadian Press cable dated at Lon-

don, May 23, That some action of this kind is imperative must be clear to every hon. member opposite. Why, their own leaders are now talking glibly and fatuously about the necessity for a rise in price level, but they will not take the only means by' which that rise may be brought about. They' refuse to. They say, "Oh no, we cannot do that; we are on a sound money basis." I say to them that as long as they insist upon staying on a so-called sound money basis and tying Canadian internal and external monetary-matters to New York, they cannot raise price levels unless New York does. They are tied definitely to the New York money policy. Our monetary- policy for years has been governed pretty well by that of the United States federal reserve. As an hon. member said in this house not long ago, w-e are regarded on Wall street as the thirteenth federal reserve district, with this difference, that the other twelve districts have a voice in the policy, and Canada has not.
That condition of affairs which has prevailed due in part to the absence of the establishment of a central publicly owned and directed bank in Canada, will prevail as long as this government's avowed policy of so-called sound money continues. Prices must rise-well, if they do not rise there must be a general cancellation, or, worse still, a general repudiation of debts; we cannot meet our obligations. Let us take a look at the picture, Mr. Speaker. In Great Britain, France, Australia, Italy, India-anywhere-the great demand at the moment is for a rising price level. Because of what? Because of a mad monetary and economic system which is placing upon the backs of the common people all over the world the intolerable and unbearable burden of debts. Study the history of any borough in England; study the history of any state of the union; take the financial statement of any province in Canada and read the story. There is but one picture. Let us go back one hundred, twenty-five, ten or even five y-ears ago, and we will find that from year to year there has been a story of steadily growing debt, steadily piling up of fixed obligations reaching an aggregate which staggers the imagination. W'e hear talk of an attempt to meet those obligations today-. With the prevailing price levels of commodities I tell y-ou it is impossible. Why, the world's gold bearing obligations alone are over five hundred billion dollars, and there is only eleven billion of monetary- gold in all the world. The thing is a farce. So it is not surprising that those who have some interest in economics and less in politics, who have studied these problems, are now- expressing

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the views which have been expressed by men who have been trying to find a road which would lead to a betterment of the condition of Canadian people.
I have in my hand the words of Dr. Marvin of the Royal Bank, who says that as prices have continued to fall the burden of debts has been increased by from fifty to seventy-five per cent.
Then I read the following statement:
It is coming to be realized that there must be a major rise in prices or there will be heavy cancellations of a substantial proportion of such obligations.
Then he follows with a closing paragraph which I draw to the attention of the Minister of Trade and Commerce (Mr. Stevens) and the Minister of Finance (Mr. Rhodes):
One thing or another is inevitable; prices must rise or there will be a wholesale cancellation or repudiation of such debts. For the same reason a continuation of the present price level will bring on wholesale bankruptcy.
The facts are before hon. members opposite, and they may do what they wish about it. But already even their Tory colleagues in Great Britain are beginning to see the light. Imagine my astonishment, and that of those who have been preaching this gospel for some years, when we find coming to the support, not of our detailed policy but of part of it, no less a personage than Lord Beaverbrook. I almost apologize for quoting his words.


Ernest Lapointe: You must be wrong.


Edward Joseph Garland: After reading the economic monstrosities of which he has been guilty, I cannot imagine that anything that Lord Beaverbrook would say can be of value. Yet these words of his are so apropos at the moment that they have a value. This is not an editorial. I quoted on a former occasion an editorial from the Daily Express of April 13. These are Lord Beaverbrook's own words, from an article which he himself wrote in the Daily Express subsequent to that time:
It should be our policy to make money both plentiful and cheaper. It may be fairly cheap at the moment. I do not deny that. It is certainly not plentiful. Until we have made it plentiful we will not be able to maintain the standard of wages here.
How can it be made plentiful? Send the Bank of England about its business! Let it continue to perform the functions of a joint stock bank.
Establish a central bank, owned by the nation, equipped with all the powers necessary to provide abundant credi-t and hedged about by all the restrictions required to safeguard the permanence and stability of the structure. That is the solution. Give us the right to establish reasonable credit and sufficient banking facilities for the people, and you will get
the present wage 'level, stability of commodity prices and prosperity for our people. Give us that authority and you will get the restoration of the cuts.
If you believe in the policy, join our movement. If you do not want it, do what you can to destroy us!
The same words may be directed to hon. gentlemen opposite-well I do not think they will destroy anything by not joining it; I think rather they will destroy anything by joining it. Frankly I would rather not have them as long as they hold their present point of view on these matters.
But hon. members are frightened by this bogy of inflation, this ghost that they conjure up to wriggle in front of them; they see Germany, they see Russia, they see all sorts of things, forgetting there is no analogy. If they were fair in their examination of the proposals they would say: Yes, inflation does not need to be the mad thing it was in Germany. In France, it was not. France undertook an intelligent form of inflation, under which she cleaned off her internal debts, established the franc at a value far below its pre-war value, and placed herself in such a position that she was able to act as an instrument which nearly destroyed Great Britain's financial power. She is an example of a country which undertook intelligent inflation. We could do the same, we could manage inflation. But remember, even France has not escaped, because the French policy of banking did not extend to the rational internal economic planning that is a necessary part of a managed currency policy. The two have to go hand in hand. I am however discussing merely inflation at the moment, Hon. gentlemen should not forget that the late C. E. Neill, general manager of the Royal Bank of Canada, in the last annual statement he was able to deliver, pointed out that the only way by which the price level could be restored was by inflating the purchasing power and credit and currency of the country. Not only that, but he goes further and says that it is the denial of intelligence to assert that one cannot achieve stability of price level, and in illustration of that he says: overproduction of agricultural products in relation to manufactured articles would justify a decline in the price level, but when the average of all prices declines this can only be explained by an under supply of that in which prices are expressed, i.e. money, and it would seem that ii the effective supply of money is kept in the right relation to production of commodities, the phenomenon of a declining average price level will not occur.
Those are not my words, they are not the words of hon. members around me, they are
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the words of the late general manager of the Royal bank. Further on he says that if it had -been decided that drastic contraction of currency and credit was not to be permitted, a drastic fall in the price level could not have occurred.


Mr. SPEAKER:: The hon. member has spoken for forty minutes.


Edward Joseph Garland: In conclusion, then, I would urge upon the govern-Tnent not to be terrified by those who hold up the bogy of inflation, but to realize, as they must if they have intelligence, that the only possible way of bringing about a rising price level-so at least temporarily to stave off collapse-I do not know whether they can permanently save it-is by a policy of inflation, which involves the abandonment of the gold standard.


Mr. SEGUIN:: Mr. Speaker, I would like the question to be put in French. Since the opening of this session the questions have been always put in English.


William Lyon Mackenzie King: I was paired
with the right hon. Prime Minister (Mr. Bennett). Had I voted I would have voted against the motion.


Mr. POWER:: I was paired with the hon.
member for Muskoka-Ontario (Mr. McGibbon). Had I voted I would have voted against the motion.


Mr. SANDERSON:: I was paired with the hon. member for Haldimand (Mr. Senn). Had I voted I would have voted against the motion.


Mr. BAKER:: I was paired with the hon.
member for Prescott (Mr. Bertrand). Had I voted I would have voted for the motion.


Mr. GOLDING:: I was paired with the hon. Minister of Public Works (Mr. Stewart). Had I voted I would have voted against the motion.


Mr. HEAPS:: I was paired with the hon.
member for East Calgary (Mr. Stanley). Had I voted I would have voted against the motion.


Mr. SPENCER:: I was paired with the
hon. member for Frontenac-Addington (Mr. Spankie). Had I voted I would have voted against the motion.


Mr. MITCHELL:: I was paired with the
hon. member for Lethbridge (Mr. Stewart). Had I voted I would have voted against the motion.


Mr. GEARY:: I was paired with the hon.
member for Laurier-Outremont (Mr. Mercier). Had I voted I would have voted for the motion.


Henry Herbert Stevens: I was paired with the
hon. member for North Bruce (Mr. Malcolm). Had I voted I would have voted for the motion.


Mr. SPENCE:: I was paired with the hon. member for Northumberland, Ontario (Mr. Fraser). Had I voted I would have voted for the motion.


Mr. MacDONALD (Cape Breton South):: I was paired with the hon. member for Colchester (Mr. Urquhart). Had I voted I would have voted for the motion.


Mr. SPOTTON:: I was paired with the
hon. member for West Elgin (Mr. Hepburn). Had I voted I would have voted for the motion.


Edward James Young: I was paired with the hon. member for South Renfrew (Mr. Maloney). Had I voted I would have voted against the motion.


Mr. McKENZIE (Assiniboia):: I was paired with the hon. member for Durham (Mr. Bowen). Had I voted I would have voted against the motion.


Mr. DUPUIS (Translation):: I was paired with the hon. member for Northumberland (Mr. McDade). Had I voted I would have voted against the motion.


Mr. DORION (Translation) :: I was paired with the hon. member for Lotbiniere (Mr. Verville). Had I voted I would have voted for the motion.


Sir EUGENE FISET (Translation):: I was paired with the hon. Minister of Pensions (Mr. MadLaren). Had I voted I would have voted against the motion.


Mr. LARUE (Translation):: I was paired with the hon. member for Yamaska (Mr. Boucher). Had I voted I would have voted for the motion.


Mr. DUBOIS (Translation):: I was paired with the hon. member for St. John-Albert (Mr. Bell). Had I voted I would have voted against the motion.


Mr. LAURIN (Translation):: I was paired with the hon. member for St. Hyacinthe (Mr. Fontaine). Had I voted I would have voted for the motion.


Mr. RHEAUME (Translation):: I was paired with the hon. member for Berthier-Maskinonge (Mr. Barrette). Had I voted I would have voted against the motion.


Mr. GIROUARD (Translation):: I was
paired with the hon. member for Riehmond-Wolfe (Mr. Lafleche). Had I voted I would have voted against the motion.
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Mr. PARENT:: I was paired with the hon. member for East Essex (Mr. Morand). Had I voted I would have voted against the motion.
Mr. ST-PERE: I was paired with the hon. member for Hastings South (Mr. Tummon). Had I voted I would have voted against the motion.


Pierre Édouard Blondin: Mr. Guthrie moves that the Speaker do now leave the chair for the house to resolve itself into committee on the said bill.
Motion agreed to and the house went into committee, Mr. LaVergne in the chair.
Section 1 agreed to.
On section 2-Trade agreement approved.


William Lyon Mackenzie King: This section reads:
The trade agreement entered into between representatives of His Majesty's government in Canada and of His Majesty's government in the United Kingdom, copy of which is set forth in the schedule to this act, is hereby approved.
This is the first opportunity we have had, Mr. Chairman, to gather the significance of what is contained in the schedule attached to the act, and we would like to take up that schedule clause by clause, so that we may find out just what each clause amounts to.


The CHAIRMAN:: I understand the rule is that the schedules are discussed after the bill is passed.


William Lyon Mackenzie King: Not a bit of it. The schedule in this case is pretty much the bill itself; it is part of the bill, and we cannot possibly understand what is in the bill without considering the schedule.


Armand Renaud La Vergne: The rule is that the schedules are discussed after the bill has been passed. The schedules can be referred to and discussed, of course, but the schedules approved by section 2 would be only the schedules adopted by the house at another stage.


William Lyon Mackenzie King: We can discuss them now, of course, but for the purpose of facilitating the discussion we should like at this stage to take them up one by one. Perhaps you, Mr. Chairman, would read the items one by one, in order that we may discuss them.


Armand Renaud La Vergne: Unless it is with the general consent of the committee we cannot do that now, because the rule is very clear. They must be discussed and voted upon after

the bill has passed. If the committee gives general consent, of course, that rule can be suspended.


William Lyon Mackenzie King: I should like to say to the members of the government that if immediate opportunity is given to discuss these schedules in detail I think the time of the house will be saved materially in the long run. I hope members of the government will give their consent.


Edgar Nelson Rhodes: If it would meet the convenience of the committee and the chairman, it would be entirely acceptable to us to have the items taken up one by one as has been suggested by the leader of the opposition.


Armand Renaud La Vergne: Then the rule will be suspended by general consent of the committee. The schedule reads:
We, the representatives of His Majesty's government in the United Kingdom and of His Majesty's government in Canada hereby agree with one another, on behalf of our respective governments, as follows:-
Article 1.-His Majesty's government in the United Kingdom undertake that orders shall be made in accordance with the provisions of section 4 of the Import Duties Act, 1932, which will ensure the continuance after the loth November, 1932, of entry free of duty into the United Kingdom of goods consigned from any part of the British Empire and grown, produced or manufactured in Canada which by virtue of that act are now free of duty subject, however, to the reservations set forth in schedule A appended hereto.


William Lyon Mackenzie King: Mr. Chairman, will you please read schedule A, which is referred to in this article.


Armand Renaud La Vergne: Schedule A reads:
As regards eggs, poultry, butter, cheese and other milk products, free entry for Canadian produce will be continued for three years certain. His Majesty's government in the United Kingdom, however, reserve to themselves the right, after the expiration of the three years, if they consider it necessary in the interests of the United Kingdom producer to do so, to review the basis of preference so far as relates to the articles above enumerated and, after notifying His Majesty's government in Canada either to impose a preferential duty on Canadian produce whilst maintaining preferential margins, or in consultation with the Canadian government to bring such produce within any system which may be put into operation for the quantitative regulation of supplies from all sources in the United Kingdom market.


James Layton Ralston: Article I of the schedule is the article which provides for the free entry into Great Britain of a certain general list of articles. It does not provide for preference. The article simply provides that a certain list of goods, as to which orders will be made from time to time, will enter duty free

United Kingdom
into Great Britain. I want to ask whether or not there is, outside the provisions of the schedule itself, any sort of assurance as to the maintenance by Great Britain of duties in respect of goods other than those specified in schedule B and schedule C, or whether schedule B and schedule C are exhaustive of all items as to which Great Britain agrees to maintain the duties, thus leaving all the rest of the goods which are admitted free subject to being admitted duty free from all other countries as well as from Canada.


Henry Herbert Stevens: My hon. friend will find that in article 3:
His Majesty's government in the United Kingdom undertake that the general ad valorem duty of 10 per cent imposed by section 1 of the Import Duties Act, 1932, on the foreign goods specified in schedule C shall not be reduced except with the consent of His Majesty's government in Canada.


James Layton Ralston: I mentioned schedule C.


Henry Herbert Stevens: The article, which of course, is very broad and general, ensures the Dominion of Canada free entry into the British market of virtually all goods, with certain minor exceptions, specified in the Import Duties Act of Great Britain, and it not only includes the articles in schedule C to this agreement, but it will be applicable to and include, of course, all articles in the various schedules of the other dominions, the benefits of which are extended to Canada by article 1. This will virtually ensure what the hon. gentleman refers to. It will ensure to Canada, so far as schedule C is concerned, and so far as the schedules of the other agreements are concerned, the continuance of the spread. To that degree at least the assurance of the spread is declared in this agreement.


James Layton Ralston: The minister says that
this article 1 ensures a spread in so far as the items mentioned in schedule C are concerned. That spread is specified at ten per cent. He also says that it ensures a spread so far as articles coming in from the other dominions are concerned. That is what I am unable to find in this agreement, but I have no doubt the minister has authority for the statement. What I apprehend is that we may find that goods which are admitted free from, let us say, Australia are also admitted free from Canada, but I apprehend also that it is possible we may not find that with regard to those goods which are admitted free from Australia and as to which duties are imposed against the rest of the world, these duties are to be maintained, so that the margin of preference will be maintained. What authority has the minister for the statement he made a moment ago that this article permits the entry free into Great Britain of goods from Australia not specified in the Import Duties Act?


Henry Herbert Stevens: We are clear that so far
as schedule C is concerned we are protected. We are clear on this also, that the advantages extended to Australia under their schedule are in a similar manner extended to Canada under the provisions of article 1.


James Layton Ralston: That is what I cannot
find.


Henry Herbert Stevens: My hon. friend will find
it in article 1.


James Layton Ralston: I thought I would but I
cannot find it.


Henry Herbert Stevens: Article 1 reads:
-will ensure the continuance after the 15th November, 1932, of entry free of duty into the United Kingdom of goods consigned from any part of the British Empire-


James Layton Ralston: "And."


Henry Herbert Stevens: 1 want to emphasize this clause for a moment.


James Layton Ralston: Go on; there is that
"and."


Henry Herbert Stevens: Please permit me to make my point clear:
-consigned from any part of the British Empire and grown, produced or manufactured in Canada-
That means that any goods grown or produced in Canada which are similar to goods produced in any other part of the empire and admitted free into the United Kingdom from any other part of the empire will be admitted free from Canada. That is clear, I think.


Mr. NEILL:: It doesn't say that.


James Layton Ralston: It does not seem clear.


Henry Herbert Stevens: To me the matter is very clear and definite. To illustrate my point I would refer to the Australian treaty. It will be found that that treaty contains a schedule which deals with certain goods to be admitted into the British Empire under certain specified margins of preference. Canada is ensured the same specified margins of preference.


James Layton Ralston: Oh, no.
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Henry Herbert Stevens: I should like to reason that out with my hon. friend. I shall return to where I was a moment ago. Under schedule C, we are ensured; we are agreed that under her schedules, Australia is ensured a certain market. The goods of Australia admitted free into the United Kingdom are guaranteed to us under article 1.


James Layton Ralston: To entry free.


Henry Herbert Stevens: The margin is ensured and if it is ensured for Australia, it is ensured for us.


James Layton Ralston: No.


Henry Herbert Stevens: Absolutely.


James Layton Ralston: That is exactly what does not follow. I am unable to find in article 1 the undertaking to which my hon. friend refers, namely, that goods from Australia which are admitted duty free are necessarily admitted duty free when they come from Canada. The words are:
-which will ensure the continuance after the 15th November, 1932, of entry free of duty into the United Kingdom of goods consigned from any part of the British Empire and grown, produced or manufactured in Canada-
There are two conditions which have to be fulfilled, namely, consigned from any part of the British Empire, and grown, produced and manufactured in Canada. But I shall leave that to one side for the moment. Assuming that these goods do enter duty free, I want to know what preference we will get. Can they be made duty free from other countries as well? Is there any undertaking whereby it is agreed that a duty will be maintained against the rest of the world on these particular goods? That is what I have been unable to find in this agreement, nor do I find anything to suggest that if there is an agreement to preserve a margin of preference for Australia, that agreement applies so far as Canada is concerned. The only provision that I can see which preserves and ensures a Canadian preference is article 3, referring to schedule C, which provides that a margin of preference shall be maintained by saying that the duties which now exist shall not be reduced except with the consent of His Majesty's government in Canada. Even article 2 does not state positively that the duties which it is proposed to put into force will be maintained. I cannot find anything except schedule C which preserves and ensures the margin of preference.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


James Layton Ralston: Before recess I had made some observations in which I asked the minister to point out to tlhe committee anything in article 1 whic-h ensured Canada a preference on goods covered by the Import Duties Act, and which would be the subject of orders under that article.


Henry Herbert Stevens: I frankly admit that these matters are perhaps not as clear as one would like, but I 'believe a correct interpretation and understanding of the agreement, which is quite clearly understood, I think, between the two governments affected, will give to my hon. friend the assurances he desires. Let me repeat in part what I said before recess. I shall put it in a little different way and I hope I shall make myself clear. It will be observed that in so far as the dominions on the one hand and the United Kingdom on the other are concerned, the guarantee of preferences or of spreads is limited to the schedules. In order that the fairness of the particular side of the agreement to which my hon. friend is referring may be appreciated, let me point out that so far as guarantees by Canada are concerned we guarantee spreads or preferences on schedule E, but on the full range of our tariff outside schedule E we are at liberty to go up or down or adjust it in any way we like


James Layton Ralston: That is under article 9.


Henry Herbert Stevens: Yes. The same principle precisely applies on the other side; that is, Great Britain in schedule C to the Canadian agreement and to the schedules in the agreements with Newfoundland, Australia, New Zealand and South Africa also guarantees certain spreads to those dominions. The advantages and the assurances of those spreads accrue to the benefit of Canada because under article 1 we are ensured free entry to the British market of any goods coming from the British Empire.


James Layton Ralston: And grown or produced in Canada.


Henry Herbert Stevens: We are not interested ii they are not. We are ensured of free entry to the British market, and the British government has obligated itself, in the one instance with Canada and in the other with Newfoundland, Australia, New Zealand and South Africa, to maintain certain spreads. Consequently we are ensured the benefit of the preference on all the goods enumerated in the various schedules

United Kingdom
in the agreements with the dominions. Let me illustrate that by citing just one item which is peculiarly appropriate so far as Canada is concerned. It will be noted that Newfoundland is ensured on chilled and frozen salmon lid. or three cents spread per pound. The point is this: we get free entry into the British market for our frozen salmon and other fish just the same as Newfoundland does. Great Britain is bound to maintain a duty of three cents a pound in order to discharge her obligation to Newfoundland. Therefore Canada is beneficiary, under its own agreement with Great Britain, to that advantage which is not specifically to us but is to Newfoundland. The same principle is applied throughout all the items enumerated in all the schedules to the agreements of all the dominions.


Alan Webster Neill: Why should Canada get that Newfoundland preference on salmon?


Henry Herbert Stevens: Because it is part of the
general agreement given to us in article 1. I can see where my hon. friend is a little confused there, and I am not for a moment criticizing him. Leit me put it in this way: we are ensured free entry. Great Britain has undertaken with Newfoundland to maintain a spread of three cents, a duty of three cents against foreign salmon. As a result of that we also have the assurance of a spread of three cents.


William Lyon Mackenzie King: That may be, but it is not in the agreement.


James Layton Ralston: In the first place it is
not in the agreement, and in the second place that would all be subject to an agreement between Newfoundland and Great Britain who might at any time change their arrangements so that we would lose the benefit of this.


Henry Herbert Stevens: I agree with my hon. friend that that is true.


James Layton Ralston: We are not guaranteed by that.


Henry Herbert Stevens: The agreement with Newfoundland is for five years, the same as all of them.


Mr. MACKENZIE (Vancouver):: Was this understanding reached after the termination of the conference and the signing of the agreement? Because in article 1 there is nothing to lead anyone to suppose the contention of the minister is as he has stated.


Henry Herbert Stevens: It is a oonsequence inherent in the agreement. Let me read article 1 in the light of what I have said:
His Majesty's government in the United Kingdom undertake that orders shall he made 53719-84
in accordance with the provisions of section 4 of the Import Duties Act, 1932, which will ensure the continuance after the fifteenth November, 1932, of entry free of duty into the United Kingdom of goods consigned from any part of the British Empire and grown, produced or manufactured in Canada-
If the agreement were with Australia, this would read: "grown, produced or manufactured in Australia."


James Layton Ralston: And one other condition.


Henry Herbert Stevens: Yes.
-and grown, produced or manufactured in Canada which by virtue of that act are now free of duty subject, however, to the reservations set forth in schedule A appended hereto.
For the moment we can leave schedule A out of the picture. In other words, we are ensured free entry for those goods; Great Britain is obligated for five years with Canada, Australia, New Zealand, Newfoundland and South Africa to maintain certain spreads, and this is just as definitely ensured to us as if it were in our agreement.


James Layton Ralston: No, it cannot be; we are not parties to it. They can change it at any time.


Henry Herbert Stevens: My hon. friend raises the
question that for instance South Africa and Great Britain might make a change. That is quite true. Canada, for example, might agree with Britain to change her agreement. But it is pretty clear to all of us that these agreements will not be the subject of frivolous changes from day to day. The particular change would occur only where there was some specific reason for it.


James Layton Ralston: "Some mutual advantage," to use the words of the Prime Minister.


Henry Herbert Stevens: Yes, and the same thing
would apply to any item in our agreement. So there is no disadvantage to us from the possibility of a change by one of the dominions any more than there is in a possible change in the agreement between ourselves and the United Kingdom. That is a very generous assurance to us of the spread. There is one other reason which I would submit to my hon. friend.


James Layton Ralston: It is not an assurance of the spread; it is only an assurance so far as free entry is concerned.


Henry Herbert Stevens: I am sorry I cannot agree with my hon. friend there. I say that there is an assurance of free entry, and because of



Imperial Conference-Trade Agreements
that assurance of free entry and because of the undertaking in agreements of the United Kingdom to maintain a spread, we are ensured of the spread.


Ian Alistair Mackenzie: Within
the limits of the schedule.


Henry Herbert Stevens: Within the limits of the schedules of all the dominions.


Ian Alistair Mackenzie: That is
not implicit in this agreement.


Henry Herbert Stevens: It is inherent. It is not set forth in so many words, but that is not necessary.


Ian Alistair Mackenzie: Was this understanding arrived at by negotiations with the British government after the conclusion of the conference?


Henry Herbert Stevens: No. In all these discussions there were certain articles, for instance, in which Australia was peculiarly interested; certain ones in which Canada felt she had a major interest. The same thing applies to the other dominions. The various negotiations between the various dominions and the mother country were carried on separately, but we had committees which dealt more or less with all the items in certain classifications. I happened, for example, to be the chairman of the cereals committee. All the dominions were represented on that committee, but as New Zealand and Newfoundland were not particularly interested in cereals their attention was of an indifferent nature. On the other hand South Africa was interested in com, Australia in wheat, flour and barley. Canada also was interested in those three commodities, in addition to other grains. WTe all sat in together, discussed, analysed, and went into the whole matter as a committee. Then, Mr. Bruce and I, representing the committee, discussed the whole matter with the British authorities, and arising out of the study we made came the various items in these different schedules. Hon. members will notice that the Canadian schedule includes wheat, because Canada was the country most interested in that commodity. South Africa dealt particularly with corn, while we, on the other hand, so far as export is concerned. wrere not very much interested in that commodity. Meats constituted the chief item in the minds of the Australian delegates, and they were heard in another committee altogether.
I do hope my hon. friends opposite may see my point and accept it, because I am quite certain of the soundness of the position I 
have taken. Although it may not be infallible and unalterable like the laws of the Medes and Persians, it has equal significance in all the dominions. I believe my position ;s sound as to the assurance of the enjoyment by Canada of the spreads shown in the schedules, such enjoyment being subject always to the mutual agreement as to change, which is found in all the agreements.


Ian Alistair Mackenzie: The minister has not made the points clearer; on the contrary he has made them less clear. He has given an assurance which I am ready to accept, but I suggest to this committee that there is nothing whatsoever in article 1 of the agreement which bears out the declaration he has made. I suggest that any hon. member who reads the article will immediately ascertain that there is one, and only one, guarantee, namely that of free entry for goods which by virtue of the Import Duties Act of 1932 are now free of duty "subject, however, to the reservations set forth in schedule C appended hereto." The minister informs the committee that there was an understanding, which I accept, between the Dominion of Canada, the United Kingdom and other dominions in regard to giving Canada the benefit of certain mutual concessions or arrangements between other dominions and the United Kingdom. The effect of the hon. member's explanation is that article 1 is nothing but a blundering article.


Henry Herbert Stevens: Oh, no.


Ian Alistair Mackenzie: Yes, it is. There is no legal provision in article 1 to bear out the contention of the minister. I ask him to consult his colleague the Minister of Justice on that point. He will not find in article 1 the stipulation he suggests, either in law or in fact. I suggest further that the explanation he has just made bears out the contention advanced so often from this side of the house during the debate, with regard to the provision of free entry. There is not a scintilla of justification for the statement that article 1 guarantees to the Dominion of Canada a margin of preference other than that which is guaranteed by specific provisions in schedules B and C.
I should like to refer the Minister of Trade and Commerce to the speech made by the Prime Minister when the agreement was presented to the house. At pages 116, 117 and 11S of Hansard for the present session the Prime Minister placed on record a long list of articles to which reference had been made in

United Kingdom
the Import Duties Act of the United Kingdom. Before setting forth the items to which I have referred, the Prime Minister said:
In respect of manufactured goods, free entry secured to Canada by article 1 of the agreement will mean that we shall now enjoy the following preferences.
Just note these words.
Not ten per cent, but the larger margins represented by the tariffs which Great Britain has imposed against imports from foreign countries, while goods from this country enter free.
Then follows a long list which I shall not weaiy the committee by reading, but which is to be found in the pages I have named. In that list there are innumerable articles specified by the right hon. Prime Minister in connection with which he said a preference was being given. One will not find, however, any reference to the major portion or, in fact, to any of these articles, in the schedules now under consideration in this committee. What does this mean? The Prime Minister distinctly implied a guarantee of a margin of preference was given to the Dominion of Canada in these articles. There is not the slightest justification within the terms and provisions of article 1 of the treaty to justify the statements of the right hon. gentleman, and I am sure my hon. friends will bear me out in that. One could show item after item in which there is no guarantee of preference.
In that connection I refer the minister to a statement made by Sir John Simon, the British foreign secretary in the British parliament. He is reported as follows:
It was untrue to say that the Ottawa agreements had restricted the United Kingdom's power to enter into trade negotiations with foreign countries.
There are concessions in regard to a few items which are stipulated, and outside of that we have only the guarantee of free entry which we have always had. As against foreign nations the British government, through their foreign secretary, have told the United Kingdom that the3' have the free right to reduce the duties against foreign countries. In other respects there is nothing within the four corners of article 1 to prevent the government of the United Kingdom from guaranteeing free entry to any country, except in so far as such action would be barred by the provisions of schedule C. Last night, speaking on the treaty, the Prime Minister reaffirmed his contention which appears at page 116 of Hansard, I suggest, with all respect, that the statement of the Prime Minister is not in accordance with the facts as borne out by a careful study of article 1 of the treaty. I 53719-64J
suggest that some one blundered and that Canada's interests have been ignored in the drafting of article 1 of the treaty now under consideration.


Henry Herbert Stevens: Now, Mr. Chairman, the hon. member has cast very serious reflections on the word and honour of the Prime Minister.


Ian Alistair Mackenzie: No.


Some hon. MEMBERS:: Yes, yes.


Ian Alistair Mackenzie: On a point of order I wish to say that I merely stated that the representations of the Prime Minister at page 116 are not in accordance with the facts.


Henry Herbert Stevens: All right; we shall examine that contention. The hon. member has said that the Prime Minister led the house to believe that we had a guaranteed preference on these two or three pages of items. What did the Prime Minister sa}?? At page 116 of Hansard he is reported as follows:
In respect of manufactured goods, free entry secured to Canada by article 1 of the agreement will mean that we shall now enjoy the following preferences.


Ian Alistair Mackenzie: Yes.


Henry Herbert Stevens: Just a minute. He continues :
Not ten per cent, but the larger margins represented by the tariffs which Great Britain has imposed against imports from foreign countries, while goods from this country enter free.
That is a precise and exact statement of fact.


James Layton Ralston: For the moment.


Henry Herbert Stevens: Yes-just a minute. That is a precise statement of fact. On a long list of items enumerated in some detail, and to which reference is made in the Import Duties Act, copies of which have been distributed, there is a certain duty in Great Britain against these articles now-now. We enter free, and now we enjoy the preference on those articles.


Ian Alistair Mackenzie: We do not.


Henry Herbert Stevens: I beg your pardon.


Ian Alistair Mackenzie: Some of those articles have been changed since the Prime Minister spoke.


Henry Herbert Stevens: Well, there may have been some changes, but I am not aware of them. Let us get this matter clear. When the act was first passed in the British house in April last the rate of duty was limited to ten per
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cent, and under certain sections of that act which I recall, the commission which was set up under it was empowered to enlarge these duties, which they did so on certain specified lists of articles, raising the duties in some cases to twenty, twenty-five, thirty, and thirty-three and one-third per cent. The benefit of all of that accrues to Canada as well as to the other dominions-all of it-now and in the future just as long as those duties stand. AH of that refers to the list of articles outside of the schedules. There is no guarantee in the agreement that these spreads will be maintained. The Prime Minister never said that they would be, and it has never been argued that they would be.
Now let us turn to Canada. On all that list of Canadian articles numbering, I should say, seven or eight hundred, outside of schedule E, Canada has certain duties against foreign countries and certain duties against Great Britain. At the present time Great Britain enjoys that preference in precisely the same way that we enjoy this preference in the British market on this list of articles. But in regard to schedule E of this agreement, we guarantee to Great Britain certain spreads and to maintain those spreads for five years. In regard to schedule C, Great Britain guarantees to us certain spreads. In that respect both countries are in a position of equality except that our list happens to be a little longer than theirs.
What Sir John Simon said has been referred to several times. As I read his remarks, he said this, that subject to the general provisions of the agreement-and I say the same for Canada-Great Britain is free, and Canada is free, to manipulate its tariff in any way it likes. There is absolute freedom in that regard. Canada, for instance, is free to take seven or eight hundred items and either make them all free or raise or lower the duties in any way she likes. In regard to the list of articles not specified in the schedules Great Britain is free to raise or lower her tariffs just as she likes. So I submit, Mr. Chairman, that there is no variation from fact; indeed it is rather stretching parliamentary etiquette to assert that all the Prime Minister said is at variance with the facts.


Ian Alistair Mackenzie: I still think so.


Henry Herbert Stevens: I am afraid I cannot help my hon. friend to a keener appreciation of what is both courtesy and fact. Surely my hon. friend does not persist in such a position. I cannot conceive of any hon. gentleman in the house doing so in the face of the words of the Prime Minister which I have quoted.

The Prime Minister says nothing whatever about a guarantee of preference. He says: "We shall now-" he qualifies it even with the word "now"-"enjoy the following preferences." Do we now enjoy those preferences? We certainly do.


Ian Alistair Mackenzie: No, we do not.


Henry Herbert Stevens: I cannot argue with that. We certainly do enjoy those preferences now. As a matter of fact, I think the House of Lords has passed the bill although I am not quite certain of that. I will admit that all our discussion is subject to the ratification of the agreements. But even without the ratification of the agreements, we do now enjoy these preferences because they are in force until November 15, and we have not yet reached that date. This agreement extends beyond November 15 what we now enjoy in regard to this long list of articles. Even if the agreements are not yet ratified and their terms not yet in force, up to November 15 the Prime Minister is quite correct in saying that we now enjoy "the following preferences."
My hon. friend suggests that there are some items which have been varied since this list was produced by the Prime Minister. There may be, but I am not going to argue that point, but they would merely be variations in small details. It is a fact that we now enjoy these preferences that are given to us because of free entry of Canadian goods to the mother country, on the one hand, and the imposition of duties as against foreign countries on the other hand.


Ian Alistair Mackenzie: The hon. Minister of Trade and Commerce made certain references to matters of courtesy and of fact. May I inform him that I do not find it necessary to accept any observations from him in regard to either the one or the other. Let me read the words of the Prime Minister:
In respect of manufactured goods, free entry secured to Canada by article 1 of the agreement will mean-
Note it says, "will mean." Note the ordinary English of the Prime Minister's phraseology. He says "will mean," not "does mean:"
-that we shall now enjoy the following preferences.
"Shall now" must mean one of two things. It must mean that we do now enjoy them or that we shall in the future continue to enjoy them. I maintain that the Prime Minister is wrong on both counts, and to prove that I am correct I suggest to my hon. friend

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that since the Prime Minister made this statement, an order in council was passed by the British government under the very terms of the Import Duties Act of March 1, 1932, in regard to an extensive list of articles appearing on page 117 of Hansard, and under that order in council the tariff changes that were made were limited to a period of two years. What does my hon. friend say to that?
The Prime Minister meant one of two things. He meant that at the time he was speaking we were then enjoying these preferences-and I say that that is not correct because there is no guarantee of continuity in regard to these preferences, as my hon. friend knows and has admitted. Either intentionally or inferentially when the Prime Minister made his statement on the twelfth of October he gave the impression, to me at least-


Henry Herbert Stevens: Would my hon. friend
give me the number of the order in council to which he refers ?


Ian Alistair Mackenzie: I will get it for my hon. friend in a moment or two.


William Lyon Mackenzie King: It was passed about ten days ago.


Ian Alistair Mackenzie: The
mere fact that the provisions of these articles were altered by order in council proves the soundness of our contention that there is no guarantee of the preferences given toi this dominion in respect to these goods under the provisions of article 1. We have always had free entry to the British market, with certain exceptions. My bon. friend the Minister of Trade and Commerce should be the last to accuse one who is trying to point out facts of a lack of courtesy or of inattention to fact; for every single word we have said in regard to the provisions of article 1 has been amply demonstrated and proved. All that article 1 gives us is free entry, with certain reservations, and there is no guarantee, except with very obvious limitations and on specified exceptions, to Canada as against foreign countries of a general marginal preferential spread as against foreign nations. In fact, by altering the duties Great Britain has already told us that she is free, in the words of her foreign secretary, to reduce these duties as against foreign nations. That proves our contention that article 1 only guarantees the Dominion of Canada free entry with certain reservations, and gives authority to the United Kingdom to reduce these very tariff spreads by her duties against foreign countries. I hope that is clear to my hon. friend.


Henry Herbert Stevens: My hon. friend is simply proving the statement that I made a moment ago. He says that an order was passed some time ago by the British government varying the duties on this list. We have all the orders here, and I am unable to find it. But it is being varied frequently by orders, and regulations passed in the ordinary course, nearly all of them increasing the rates of duty. My hon. friend says that this is limited to two years, and he asks what I have to say to that. It just confirms what I said a moment ago, that Great Britain is at absolute liberty to vary in any way she sees fit the duties on that list which the Prime Minister read.


James Layton Ralston: Which was the thing the Prime Minister did not say when he was making his statement.


Henry Herbert Stevens: His words were as clear as they could be. I am going to read them again, as I do not think the matter should be allowed to rest at that. He said:
In respect of manufactured goods, free entry secured to Canada by article 1 of the agreement will mean that we shall now enjoy the following preferences.
My hon. friend says that either means now or in the future. I submit that it means both. It means that we are now enjoying them, and it means that we will enjoy these preferences just so long as Great Britain does not change them.


James Layton Ralston: He did not say that.


Henry Herbert Stevens: Surely it is clear; language could not make it more so. The Prime Minister goes on to say:
Not ten per cent, but the larger margins represented by the tariffs which Great Britain has imposed against imports from foreign countries, while goods from this country enter free.
Great Britain passed a number of orders, to my own knowledge-we have a long list of them here-increasing the duties from 10 to 20 per cent, 25 per cent, 30 per cent and 33 per cent. Let us make this clear, once and for all. So far as this list is concerned Great Britain is at liberty, as we are with our list, to change it as she will, but in regard to article 1 and article 3 Great Britain guarantees to us a certain spread on a certain limited list. To Great Britain we guarantee a certain spread on a certain list set out in schedule E. Further, as I said before, we also enjoy another guarantee, and that is on the spread, so long as it is maintained, which is guaranteed to the other dominions. That is all we claim. It is made as clear as language can make it, both in the agreement and in the words of the Prime Minister.
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William Lyon Mackenzie King: May I supplement what the hon. member for Vancouver Centre has just said with regard to the Import Duties Act, by directing the attention of the Minister of Trade and Commerce to the purpose of that act as announced at the time it was passed. It was made perfectly clear in the British House of Commons that the act was not intended for the creation of preferences, that in no sense was this its purpose. It was passed in order to raise revenue, and to help balance trade, to protect against dumping. That was made very clear. It was stated by the British government, which was a national government in which there were Liberal ministers, opposed to customs duties, that this was not to be regarded as imposing duties in the nature of protective duties, and that it was not intended for the granting of preferences to the dominions. That was made quite clear at the time the act was introduced. Great Britain, adopting the attitude which she has always adopted towards the dominions, did not, when she passed this act applying duties generally, make then apply to the dominions. They were exempted nominally up to November 15, as was stated this afternoon.


Mr. BURY:: Why nominally?


William Lyon Mackenzie King: Because the
British government never intended to make the general duties apply to the dominions.


Ambrose Upton Gledstanes Bury: Can the right hon. gentleman
tell what was the intention of the British government?


William Lyon Mackenzie King: Yes, I can tell very well by what was said in the British parliament, and by the information I have had from ministers 'who were in the cabinet at the time the measure was agreed upon.


Edmond Baird Ryckman: And those ministers are now out.


William Lyon Mackenzie King: No, I do not think they are; I am quite sure one of them is not out. Unless Great Britain was provoked into and prepared to declare economic war on all her dominions, she would not have thought of imposing the general tariff on goods coming from the dominions, nor would she think of doing it in the interests of her own consumers or her own industries.


An hon. MEMBER:: How do you know?


William Lyon Mackenzie King: I have a right to state my opinion, I think, without being impertinently interrupted by someone who knows nothing whatever about the matter.


Some hon. MEMBERS:: Oh, oh.


William Lyon Mackenzie King: If the hon.
member knew anything about it, he would not make such interruptions. I am going to repeat what I have alreadj' said, and, if I am to be interrupted, I will keep repeating it until I get a hearing.
I want to make it perfectly clear that, as far as the Import Duties Act is concerned, anyone who has read the report of the debates in the British house, as I have read them, and as some other hon. members of the house have read them, will see that it is distinctly stated that these duties are not primarily intended as protective duties; they wrere to serve many purposes. More than that, it was stated by the Right Hon. Neville Chamberlain, the Chancellor of the Exchequer, in the course of the debate, that, among other things, because of what had been done by Canada in connection with preferences to Britain, they were exempting the dominions from the application of these particular duties. That was distinctly stated.
The hon. member for Vancouver Centre referred to an order in council passed within the last ten or fifteen days. The Minister of Trade and Commerce says he has copies of all the orders in council, but, unless he has been receiving them by cable, he will probably not have a copy of this particular one, because what had taken or was to take place was announced in the press only recently in a cable dispatch. The provisions of the act were extended for a period of two years, and again the statement inferred that it was not being regarded as a measure in the nature of applying protective duties. That statement was made originally in order to protect the position of one or two ministers who were free trade ministers and at the time members of the national government in England. It was made clear originally that their staying the in the cabinet did not imply support of duties which were being proposed for preference purposes. The act is being continued for two years apparently because it is thought that, within that time, the purpose which was intended to be served by the imposition of those duties against other countries would be completely fulfilled. In the dispatch referring to the recent order in council it was stated that, as a matter of fact, it was thought that the original purpose already had been largely served; that the act had been passed, amongst other reasons, for the purpose of balancing their trade, and that trade had come to be pretty well balanced through what the measure had already accomplished.

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It was also made clear at the time the Import Duties Act was passed that Great Britain certainly would be free to grant to any other country the exemptions which were being granted the dominions under this act. I hold in my hand a copy of an article that appeared in the London Spectator of October 8, 1932. Here is what the Spectator says in regard to the right of Great Britain to give to any other nation the exemption from general duties which she is giving the dominions:
As for the astonishing Canadian contention that we are bound to maintain tariffs against foreign countries, not merely on the specific articles on which Canada is promised a preference but on the whole range of commodities on which we have imposed any duties at all, that is too untenable to call for serious comment.
The Spectator uses the words, "too untenable to call for serious comment" in referring to which it describes as "the astonishing Canadian contention" which has been put forth from some quarters and which, if I am not mistaken, the hon the Minister of Trade and Commerce is attempting to convey at the moment. It is not going to help in accomplishing the ends of this agreement if the House of Commons does not understand at this stage exactly what we are getting. One of our objections to this method of negotiating, is that it is likely to give rise to endless differences of opinion as to what has and what has not been granted. I say it will be better for all concerned if, as we go through these articles one by one, we understand clearly and exactly just what they mean. We do not desire this for the purpose of scoring any political point, but for the purpose of understanding exactly what these agreements mean and imply. More than that, if hon. members have read the analysis given in the Economist and other papers in Great Britain with regard to the agreements, they will see that, over and over again, the English writers who have reviewed the agreement have said emphatically that, with regard to the whole range of commodities, with the exception of a few which are specifically guaranteed under the agreements, Britain is free to give to nation A, nation B, nation C, nation D and so on, exactly the same thing she is giving the dominions in the way of exemption from any or all of the general duties. More than that, the United Kingdom committee which has been preparing for the world economic conference has been discussing this very matter. As some hon. gentlemen may have noticed, Sir Walter Layton resigned from that committee only a day or two ago because he said he had been instructed by the Chancellor of the Exchequer that at the world
economic conference an effort would be made to arrange to give additional preferences to other nations in much the same way as the dominions were being given exemptions. Sir Walter Layton felt this would not permit sufficiently of the removal of tariff barriers, as such an arrangement contemplated still keeping the tariff for protective purposes. He felt, as a member of the committee, that Britain should be free to negotiate for the removal of tariff altogether, rather than tie her hands by any scheme which would seek to perpetuate them. What is evidently contemplated by a section of the British government at least is that, from now on, England will proceed to make agreements with other nations; and one of the terms of those agreements will be to give the same right of free entry into British markets that is given the dominions, with the exception of the limited number of articles on which a specific preference is guaranteed to us.


Henry Herbert Stevens: I feel I must at once
answer the contention of the right hon. gentleman. If I understand it correctly, that contention is that the British Import Duties Act was not passed with any idea at all of a protective purpose, that they had eschewed any such idea, and that it was passed largely for the purposes of revenue and 'balancing the budget.


William Lyon Mackenzie King: Balancing of
trade. It was specifically so stated at the time it was passed.


Henry Herbert Stevens: The right hon. gentleman asserts now that it was specifically so stated when it was passed. Well, I will quote from the preamble to the act and from the introduction, as well as from the powers of the committee appointed under the act. The preamble reads:
An act to provide for the imposition of a general ad valorem duty of customs and of additional duties on any goods chargeable with the duty aforesaid for the imposition of duties on goods produced or manufactured in a foreign country which discriminates in the matter of importation as against goods produced or manufactured in the United Kingdom-
Oouild there be a more succinct definition of the protective doctrine than that?
-in certain other parts of His Majesty's dominions, protectorates-
And so on. Then it goes on:
We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom in parliament assembled, with a view to the restricting in the national interest of the importation of goods into the United Kingdom
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to the providing of a remedy in cases where a foreign country discriminates in the matter of importation as against goods produced or manufactured in the United Kingdom-
And so forth. Then, in regard to the powers of the committee appointed under this act to make rules, regulations, and so on, section 3 declares:
Where it appears to the committee that an additional duty of customs ought to be charged in respect of goods of any class or description which are chargeable with the general ad valorem duty, and which in their opinion are either articles of luxury or articles of a kind which are being produced or are likely within a reasonable time to be produced in the United Kingdom in quantities which are substantial m relation to United Kingdom consumption, the committee may recommend to the treasury that an additional duty ought to be charged on goods of that class or description.
Surely one could not find a clearer declaration of the principle of protection. And this is in the act; it is not rumour, it is not what someone has said about the policy of the British government, ibut it is an enactment of the British parliament. I apologize to the committee for taking u,p its time arguing the point, but I feel it my duty to controvert the position taken by the right hon. gentleman. He says that Great Britain may, if she likes; raise or lower duties to give the same rate of duty on a wide range of articles that she gives to the dominions.


William Lyon Mackenzie King: Not the same rate of duty, but free entry.


Henry Herbert Stevens: Yes, and so can Canada. Canada can give free entry tomorrow, if parliament so desires, to foreign countries on a list of articles numbering about 800. Britain can do the same thing. I made it clear a moment ago that the guarantee of spreads is limited to the schedules in these agreements, on the one hand by Canada and on the other by Great Britain. I apologize for reasserting these points, but surely my hon. friends must accept as fair our statement of the case. We do not dispute and never have disputed the right of Britain to make any change she likes with respect to articles outside those limited in the agreement.


James Layton Ralston: I am sure that if the Prime Minister, in the speech which he delivered on October 12, 1932, had made the statement which the Minister of Trade and Commerce has made tonight, this house would have had an entirely different idea of the agreement, and so would the country. The Minister of Trade and Commerce has been very clear 
as to what he considers the article and the agreement to cover, and we now know that so far as margins of preference are concerned, the only security, the only assurance, the only guarantee we have is in so far as those margins are applicable to special items contained in the schedules to this agreement. I will go further and confine it to schedule C and C alone. Schedule B may have some provision for a margin of preference, and we shall discuss that when we come to it. The effect of it all is that only schedule C contains a list of items on which there is a positive assurance of a margin of preference to this country for a definite time. I want to contrast that with what the Prime Minister, perhaps mistakenly, perhaps unintentionally, perhaps because he was over-enthusiastic with regard to the agreement, 'led the house to understand. I want to direct attention to what he said on that occasion and to ask the members of this committee -whether in their opinion the Prime Minister was, to say the least, as frank with the house as the minister has been with the committee tonight. The hon. member for Vancouver Centre has quoted a pasage from the Prime Minister's speech, in which he says:
We shall now enjoy the following preferences.
The Minister of Trade and Commerce sometimes complains that lawyers deal with small points, but I submit that my hon. friend has been put to it pretty hard and has to strain the English language to indicate that this statement means that "only at this moment," "as I am speaking," "just now," "this minute," "we have the following preferences." The Prime Minister did not say that. He said:
In respect of manufactured goods, free entry secured-
The word "secured" is there.
-by article 1 of the agreement will mean that we shall now enjoy the following preferences.
That statement, I submit, hardly conveys the idea which the Minister of Trade and Commerce would leave with us. The Prime Minister then follows that up with two and a half pages of items, giving the names of the items and the preferential and general rates, 106 items altogether. Can there be any doubt as to what he had in mind, as to the idea he was conveying to the house? He goes on:
The house will not fail to observe that Canada, more than any other part of the empire, will benefit by the preference secured in respect to manufactured goods.

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Does that sound like a preference that will be on today and will be taken off tomorrow?
Canada is the only part of the British Empire with factories equipped to manufacture for export to the United Kingdom many of the manufactured articles heretofore supplied to that market by foreign countries.
If he had gone on to say, "but I want to say to you that dt is possible that Great Britain tomorrow may make these goods free from other parts of the world and it is not much use for Canadian factories to equip for that purpose," then we should have understood and he would have been as frank with us as the minister has been. But he goes on to say at page 119:
The possibilities of increased activities in Canadian factories and transportation routes with corresponding decrease in unemployment, as a result of these preferences, is unlimited. We should not fail to note the additional advantage of transferring to Canada the industries formerly carried on in these other countries which now have the advantage of United Kingdom trade.
The Prime Minister is arguing there that these preferences which we shall now enjoy are preferences which we shall have at least long enough to justify the bringing of industries into Canada in order to manufacture goods and take advantage of the British market. The Minister of Trade and Commerce says to-night: "Oh, no, all he meant when he was speaking was that we enjoyed those preferences at that minute." I do not know whether or not the Prime Minister unintentionally misled the house, but I submit that the hon. member for Vancouver Centre is quite right and quite in order in claiming that the Prime Minister's language would creat the idea in the minds of hon. members of this house and people throughout the country that we were having these preferences for the term cf this agreement, that we were at least having them long enough in order that industries might be established. We have now the declaration of the minister that every one of these duties may be taken off to-morrow morning and any Canadian industries which expect to benefit by this so-called preference will find themselves out in the cold.
Let us now deal with article 1. As we now understand it, that article means that Canada is given free entry for certain goods for a period of five years. I should like to point out to the committee that we are not being guaranteed free entry for five years on all the goods mentioned in the Import Duties Act. The number of articles is limited by schedule A, which reads:
As regards eggs, poultry, buttter, cheese and other milk products, free entry for Canadian
produce will be continued for three years certain. His Majesty's government in the United Kingdom, however, reserve to themselves the right, after the expiration of the three years, if they consider it necessary in the interests of the United Kingdom producer to do so, to review the basis of preference so far as relates to the articles above enumerated and, after notifying His Majesty's government in Canada either to impose a preferential duty on Canadian produce-
Which means bringing Canadian produce up to the limit of the duties imposed against foreign countries.
-whilst maintaining preferential margins, or in consultation with the Canadian government to bring such produce within any system which may be put into operation for the quantitative regulation of supplies from all sources in the United Kingdom market.
As I understand it, that means that we are given free entry on certain goods; there is no guarantee of a preference for five years except as contained in schedule C. Even the free entry is limited to three years in some cases.


Henry Herbert Stevens: Do I understand that my hon. friend understood the Prime Minister to say that the guarantee of spread was extended over this long list of articles which he read from page 130?


James Layton Ralston: When I listened to the Prime Minister, I certainly did, and I continued to understand that until I read the speech and the articles of the agreement.


Henry Herbert Stevens: Until you read it to-night?


James Layton Ralston: Certainly not; I read it long ago, and I said so during the debate. At that time I took the point that this list of articles was incorrect and that there was no such preference as the Prime Minister had led the house to suppose there was.


Mr. BOWMAN:: Will the hon. gentleman kindly point out where the Prime Minister said that there was a guaranteed preference?


James Layton Ralston: I read the extract in which the Prime Minister seemed to intimate that this spread between free and twenty per cent on something like 160 articles would be permanent enough to justify the bringing of industries into Canada from the United States or other countries.


James Langstaff Bowman: Will the hon. gentleman
kindly point out in what part of his speech the Prime Minister stated that there was a guarantee of the preferences?


James Layton Ralston: I gave the committee the passages.


James Langstaff Bowman: I cannot see it yet.
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James Layton Ralston: I do not expect my hon. friend to see it. I am saying now that anyone reading that speech or having listened to it would be led to believe that that was the situation; he certainly would never have thought that the Prime Minister would take up the time of the house and nearly two pages of Hansard when no preferences had been assured. We know the Prime Minister is a busy man and I hope he has not needlessly taken up the time of the house. My hon. friend can draw whatever deduction he likes from it.
I was dealing with schedule A and was pointing out that this schedule limits the number of articles upon which free entry is given and provides that that free entry shall stop after three years. After that time Great Britain may put on a duty, and I direct the attention 'of the Minister of Finance and the committee to the following peculiar phrase: -to impose a preferential duty on Canadian produce while maintaining preferential margins.
Does that mean while maintaining the full preferential margin originally provided, or does it mean that schedule A is complied with by the maintaining of any preferential margin at all?


Mr. SPEAKMAN:: While the minister is
looking up that point, I should like to make a few remarks. I shall not presume to attempt to clarify the situation for the committee, but I will try to clarify it in my own mind. I should like to review the situation as it appears to me, and if my understanding is wrong, perhaps I will be corrected. As I have understood since I first read the agreement, the conditions under which our goods may enter Great Britain fall into three distinct classes. First, there is that limited class which appears in the agreement itself, and upon which we are guaranteed not only free entry but a certain margin of preference to be maintained for some time to come. I do not imagine there is any dispute over this particular class. Second, there is the large class of goods upon which we are guaranteed free entry and upon which Great Britain has a duty at the present time. There is no guarantee that that duty will 'be maintained for any given period; at the moment we have a preference, but it may be wiped out at any time. Here again I think there is fairly general agreement. Then there is the third class of goods, made up of those goods which do not appear in our own schedules and agreements but which we produce and in which we are interested. These goods appear in the agreements made between Great Britain and other

dominions, under which these other dominions are entitled to a maintained margin of preference. Quite frankly I cannot believe otherwise than that so long as this margin remains to the other dominions or until it is altered by the mutual consent of the United Kingdom and the other dominions, we must as a matter of necessity enjoy also that margin of preference.
What are the facts? There is no question but that we are guaranteed free entry upon certain goods, therefore there is no possibility of a duty against Canada being placed upon those goods by Great Britain. In the second case, the othef dominions are guaranteed a preference, and in what way? Great Britain guarantees to maintain a tariff against foreign countries in connection with these particular goods; otherwise the other dominions would have no preference. It does seem to me that it makes no difference whether or not these goods appear in our schedules. If we are entitled to free entry and Great Britain has guaranteed to maintain a tariff against foreign countries, then perforce we must enjoy that margin of preference so long as those conditions prevail, and those conditions will prevail either to the expiration of the term of years indicated in the agreements themselves or until they have them altered by mutual agreement between the United Kingdom and the dominion directly concerned. It seems to me the situation is quite clear; at least so it appears to me, and I must confess I have not as yet heard any argument which would prove to me there is no preference guarantee to us so long as we are guaranteed free entry and Great Britain has guaranteed to maintain a tariff against foreign nations.


James Layton Ralston: Will my hon. friend permit a question? Perhaps it will emphasize the point with regard to this matter. Can he tell us what goods those are?


Alfred Speakman: There is a list of
schedules appearing in the other agreements.


James Layton Ralston: We do not have them
before us.


Edgar Nelson Rhodes: If my hon. friend will look at the Newfoundland agreement, he will find a case in point.


Alfred Speakman: I was going to mention the question of canned salmon as one. To the degree that the goods appear in the other agreements, to the degree that we are interested in those goods and to the degree that the other dominions are ensured a preference on those goods, the same assurance applies to us.


James Layton Ralston: How do we know we are
interested unless we know what the goods are?


Alfred Speakman: That is another question, but I understood there was some difference of opinion on these other goods, whatever they may be, whether the preference would apply to us or not. Those are the three classes into which they fall, so far as I can see. I heard of a number of different items in which we might be interested. While they are not as important to this country as the items which appear in our own agreement they are of significance, and I have heard them mentioned casually; I have seen mention of them in the press and I heard them discussed while I was in attendance on the conference itself. Without going into them in detail I certainly have the impression-and the Minister of Trade and Commerce can give more information on that point-that there is a comparatively long list of goods in which we are interested which do not appear in our agreement but which do appear in agreements as drawn between Great Britain and the other dominions. That is how I see the situation. If I am mistaken, I am mistaken, but that is how I have seen it from the beginning and so far nothing has transpired to alter my view.


George Reginald Geary: I had intended to. say something in regard to the matter which the hon. member for Red Deer has just so lucidly explained to the committee, but I shall not attempt to cover that ground again. For the life of me, however, I cannot discover what it is that the hon. member for S'helbume-Yar-mouth, and the hon. member for Vancouver Centre are trying to prove to the committee in regard to the remarks of the Prime Minister. As reported on page 116 of Hansard

and this has been quoted more than cnce-the Prime Minister proceeds, after a discussion of and a reference to the import Duties Act, to make certain observations. No one can misrepresent the Import Duties Act; it is a public statute which everybody who is discussing this matter is presumed to know. It cannot, I submit, be suggested by anybody that the Prime Minister was 'trying to make any misrepresentation of a fact which obviously cannot ibe misrepresented: that is, that certain duties are imposed by the Import Duties Act of Great Britain. Then my hen. friend, if I do not misinterpret him, quoted the lines which have been quoted, to indicate that the Prime Minister was representing to the house that for some definite 'time there were to be duties imposed on foreign gicods as set out in the list following the remarks that were quoted.
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James Layton Ralston: Put it some substantial
time.
Mr. GEAR\ : Some substantial time? Any time? "Some substantial time" is a very indefinite suggestion. I do not think the Prime Minister made a suggestion as to substantial time >cr any other time. What he said was that from the passing of this agreement we shall have those preferences, and we are going to have them unless something is done tomorrow-


James Layton Ralston: He did not say that.


George Reginald Geary: -to take them off the statute book of Great Britain.
After referring to the Import Duties Act, what the Prime Minister said was: "We shall now enjoy the hollowing preferences." Can any possible misconstruction be put upon those words to make them a misstatement of fact? The statement stands exactly as the Prime Minister made it. My hon. friend has not suggested that he understood the Prime Minister to say that we should have this preference for any substantial time, any particular time. He is bound by the record. The Prime Minister's words are there, and I am sure mv hon. friend must know they are not capable of any such meaning as he has suggested. My hon. friend said: "I took the other meaning from them when I heard the Prime Minister speak." My hon. friend is not obtuse; he is able to grasp arguments as they are advanced. That is part of his profession. He is not the sort of person who- does not understand plain English. He said when he heard those remarks that he took a certain meaning from them. Within one week the hon. gentleman spoke with regard to what -the Prime Minister had said. I quote from my hon. friend's remarks as reported on page 389 of Hansard, and I shall ask him to reconcile this statement with what he has been saying tonight. This is what my hon. friend is reported as saying:
I have read the Prime Minister's speech from end to end, and I cannot find anywhere that the Prime Minister has suggested or has made the statement that Canada is to have the margin of preference represented by ithe difference between free entry and the amount of duty imposed against the rest of the world.
Now the hon. gentleman tells the committee that although he listened carefully to the remarks of the Prime Minister, he did not understand them, but when he came to check up his recollection of what he had heard by reading the speech in Hansard, he found that the Prime Minister had made no such statement as he and the hon. member for Vancouver Centre tonight intimated he did make.
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What happened when the Import Duties Act was passed is shown by the preamble read by the Minister of Trade and Commerce. Let no one in the house fail to grasp the fact that the people of Great Britain, as was evidenced by an overwhelming vote, had become tired of the old policy of free imports without free trade and were determined to do away with it. By the Import Duties Act they did do away with it. It may be for a substantial time; it may be for years; it may be for months, but whatever it is and as long as Great Britain stands by the policy which she has adopted in opposition to that which she carried on for many years, just so long will those duties be imposed against the rest of the world in general on goods which are admitted free from this dominion.
At no time did I understand the Prime Minister to say-and I listened as carefully as any other member to his remarks-other than what the Minister of Trade and Commerce has said tonight. The hon. member for Red Deer has categorically divided the schedules. I shall not repeat any of that, but it seems to me that the hon. member for Shelburne-Yarmouth has simply been at some pains to build up another man of straw in order that he might succeed in battering it to the ground. He has said to us he is not one for crossing "t's" and dotting "i's". I do not say he is; but tonight he is the able counsel upon whom has been forced a brief in which he does not believe but which, on account of his clients, he feels he must advocate before this chamber. I cannot understand the hon. member for Vancouver Centre making the statement that the Prime Minister had said something which was not in accordance with the fact. The written word is strictly in accordance with the fact. My hon. friend shakes his head. I should like him to show that the Prime Minister said to the house that there was a guarantee.


Ian Alistair Mackenzie: Certainly.


George Reginald Geary: I should like him to point it out. If he can convince us he has read such a thing, he will exceed my fondest expectations of his prowess.


Armand Renaud La Vergne: The leader of the opposition this afternoon asked me to read the schedule article by article. Article 1 refers to schedule A. I would ask members of the committee to confine their remarks to schedule A and article I.


William Lyon Mackenzie King: Mr. Chairman, I just wish to substantiate what I said a moment ago about the purpose of the Import Duties Act being that amongst other things,

of enabling the government to balance trade and to secure revenue, and that it was not for protective preferences. I wish to say also that the British government had no thought, unless Canada wholly failed to respond to her friendly attitude of imposing those duties upon the dominions. The quotation I am about to place on record is from the British Hansard, and is to be found at pages 48 to 52 of the proceedings for February 22, 1932. At that time the Import Duties Bill was before the British House of Commons, and Major Nathan, a member of the British house, introduced an amendment, which at this time I shall not read; it is sufficient to say that it was to the effect that these import duties ought to be made to apply to the dominions. His first utterances in support of his amendment are reported as follows:
The object of this amendment is to ensure that the ad valorem duty and the additional duties imposed in this bill, from which, by the operation of the clause as drawn, the dominions are exonerated, shall apply unless, at the same time as the remission applies to the dominions, they extend reciprocal benefits to this country. What is the reason given by the government on so many occasions for introducing this bill, for pressing it through the house at such speed, and for limiting our time for discussing our fiscal relations with the dominions-an important matter-to something under four hours? It is that the import of goods into this country will have a damaging effect upon our balance of trade and will imperil the position of sterling; and that revenue is required to relieve the British taxpayer. If imports to this country will have the effect which the government ascribe to them-and we on these benches do not subscribe to that view-imports from any country will have that effect, irrespective of whether they come from foreign countries or from the dominions.


Mr. HACKETT:: What is the date?


William Lyon Mackenzie King: February 22, 1932. That makes perfectly clear what members of the British government had been stating to the house at the time.


Ambrose Upton Gledstanes Bury: No, it does not. It makes perfectly clear only what a private member had io his mind. Does the leader of the opposition think that a statement made -by a single member should outweigh the recitals in and the preamble of the bill?


William Lyon Mackenzie King: Evidently the hon. member who has just spoken has more interest in scoring a political point than in getting at the truth of the matter. However, if my hon. friend opposite is not satisfied with the statement of an hon. member who was in the house at the time, and who was addressing the government, in his remarks to

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which, no exception on the score of accuracy was taken, let me read to him the statement of a member of the government, the reply made by ithe hon. Secretary of State for Dominion Affairs.


Ambrose Upton Gledstanes Bury: That does not affect the bill.


William Lyon Mackenzie King: The Secretary of State for Dominion Affairs, replied on behalf of the government as follows:
Clearly the speech we have heard to all intents and purposes says to the British parliament that we ought to tell the British Commonwealth of Nations "You not only must be treated as foreigners but you are foreigners." that is an insult.
Those are Mr. Thomas' words-"That is an insult". Later he has this to say:
We put all the cards on the table. No dominion can complain in any degree whatever that on the first import duties and at every stage in connection with this matter the government have taken the view that we will do all we can to encourage, help and foster an imperial spirit.
He was speaking for the government.
And I now say it is up to the dominions themselves to respond.
He elsewhere said he was sure they would. In other words he implied that the British government did not intend that at any time, unless the dominions failed to respond, those duties should be applied to the dominions.


John Thomas Hackett: I am not interested in
scoring a political point, but I am very much interested in knowing just what point the right hon. gentleman who has just taken his seat is trying to make. He states the Import Duties Act of 1932 has a meaning entirely different from that set forth in plain language both in the act itself and in its preamble.


Armand Renaud La Vergne: All of which goes to
show the necessity for the ruling against the quotation of articles.


John Thomas Hackett: I am speaking to article
1 of the agreement which is now under discussion, and to the Import Duties Act mentioned in that article and to which reference has been made by the right hon. gentleman. It seems that on February 22 last an hon. member in the British House of Commons made some comment on the Import Duties Act, and that a right hon. gentleman on the government side of the house made further comment. The right hon. the leader of the opposition has told us that he has read the British Hansard carefully. On April 26, two or three months after the discussion to which he has referred, the leader of the opposition in this
House of Commons made the following statement which is to be found at page 2384 of Hansard for the last session.
I suppose bon. gentlemen opposite are familiar with the fact that, while Great Britain has a 20 per cent tariff^ as against foreign nations, there is a provision that that tariff does not come into effect, so far as the dominions are concerned, until the fifteenth of November next. But on the fifteenth of November, unless in the meantime an arrangement has been made which is satisfactory to Great Britain, that 20 per cent tariff as matters now stand will apply against Canada as well as against foreign countries.
The right hon. gentleman now wishes us to believe that what he said at that time was without any foundation. He wishes us to believe that when the parliament of Great Britain passed this statute, for any of several purposes: whether for those expressed by the hon. gentleman opposing it or for those expressed by the right hon. gentleman espousing it, there was placed on the statute books of England an enactment which was absolutely meaningless, an enactment which he invoked in April to suit the purposes of his argument, and which he invokes in a contrary sense today to suit the purposes of another argument, and which he now says was an immense bluff. To-night he has told us that England could not have enforced that statute against the dominion without disrupting the empire. In April last he told us that unless we were successful in reaching an agreement our goods could not enter England without paying the duties imposed by the act. I am not at all anxious to score a political advantage, but I am particularly anxious to know just what the right hon. gentleman means. I should like to know whether he believes Great Britain passes legislation without any intention of enforcing it. I am anxious to know if he is of the opinion that the government of Great Britain enacts laws affecting the economic life of that country without seriously intending to carry those laws to their logical conclusion by enforcement. I venture to say to the right hon. gentleman that if he still thinks that the Import Duties Act could not and would not be put into effect, he might communicate with the Irish Free State which at the present time not only finds that statute being enforced against it, but that additional teeth have.been put into it. The position of the Irish Free State is the very position in which, in the words of the right hon. gentleman, uttered in April last, we would have found ourselves had this agreement not been passed.
There is another phase of this discussion which is rather baffling to me. The hon.
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member for Shelburne-Yarmouth said that one of the great disadvantages of this agreement was that it bound us hand and foot for a period of five years, and for nearly three weeks he and the gentlemen who sit around him entertained parliament by discoursing upon the terrible ineptitude of this government. in entering into an agreement which afforded no means of escape for a period of three or five years. When it is discovered that the agreement did not mean what they said it meant, and that there is a means of escape, there seems to be equal disarray and equal discomfort among them. Again it would be interesting if hon. gentlemen opposite would say just what their ultimate and final position is. They have been on the one side of the argument and on the other, and frequently in the centre. I think it would shorten the discussion, interest the country, and possibly enlighten parliament if they would take one position and adhere to it for a period exceeding three weeks, say for three months or possibly five years.


William Lyon Mackenzie King: I must thank my hon. friend for giving me an opportunity to make quite plain that what I said in April and what I am saying tonight are entirely consistent. If my hon. friend caught the last words of what I read from the Right Hon. J. H. Thomas, who was speaking for the government, he will see that that is the fact. The woi'ds of Mr. Thomas were:
We put all the cards on the table. No dominion can complain in any degree whatever that on the first import duties and at every stage in connection with this matter, the government have taken the view that we will do all we can to encourage, help and foster an imperial spirit, and I say that it is now up to the dominions themselves to respond.
That was as clear as anything could be. The British government did not intend to impose any duties against this dominion unless this dominion did nothing in the way of responding to action of that kind. If we did not respond, those duties might go into effect against us. We would then have had something in the nature of an economic war started by Canada against Great Britain because of her failure to adopt a like attitude of good will. But I need not say I hope such was hardly the intention or the spirit in which the present ministry went into the recent conference.


Ambrose Upton Gledstanes Bury: May I say just a word or two on the matters to which the right hon. gentleman has spoken? In the first place he has been dealing with the question of the motives which lay behind the Import Duties Act. I

cannot see any relevancy in the matter of the motives. So far as Canada is concerned, the benefits are the same whatever were the motives behind the Import Duties Act when it was passed. The benefits which we receive in Canada under the treaty are free entry for certain goods, and the benefits of that free entry are not at all depreciated or diminished if the motives of Great Britain in passing the Import Duties Aet originally were the one thing or the other. The benefits are precisely the same.
But when the right hon. gentleman produces to this house as the authority for his statement that the motive of the British government in passing the Import Duties Act was purely the raising of revenue and, with an absolute disregard for all constitutional law, of which he is usually a champion, tries to persuade this house-I am perfectly certain he did not persuade himself-that a statement by a private member of the British house was to outweigh and to render of absolutely no effect or meaning the clear statement of the act itself in its preamble, then he is asking the house to do a thing which no ordinary member is prepared to do whether he is a lawyer or not. Then the right hon. gentleman, taxed with the absurdity of this argument, asked the house to listen to what the Right Hon. Mr. Thomas had said, to support the statement and explanation made by the private member. There is not a single statement made which the hon. gentleman read as from the lips of Mr. Thomas that supports the motive that was represented and submitted by the private member. Mr. Thomas does not state that the Import Duties Act was introduced for the purpose of balancing the budget or that it was a matter of raising revenue. Mr. Thomas states that the purpose of the Import Duties Act was strictly in relation to the question of interimperial preferences. That is what he says, and therefore the quotation by the right hon. gentleman of the words of Mr. Thomas does not in the remotest degree approach the bearing out and supporting of the suggestion of the motive that lay behind the introduction of the Import Duties Act as represented by the private member whom he quoted.


William Lyon Mackenzie King: Where does my hon. friend find any mention of the word "preference" by Mr. Thomas?


Ambrose Upton Gledstanes Bury: I may not find any mention of the word "preference," but I challenge the [DOT]right hon. gentleman to deny my statement.


William Lyon Mackenzie King: I do deny it.

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Ambrose Upton Gledstanes Bury: Then the right hon. gentleman had better read his authorities again a little more carefully or else have a greater regard for the English language. The private member who spoke made it perfectly clear that the motive behind the Import Duties Act in his view was the raising of revenue and the balancing of the budget.


William Lyon Mackenzie King: The balancing of trade.


Ambrose Upton Gledstanes Bury: Mr. Thomas makes no statement that such was the purpose or motive behind the Import Duties Act. He refers the Import Duties Act to the question of trade relationships between the British dominions and the mother country, and there is not the slightest connection between the two motives. But as I said before when I rose to make these remarks to the house, the question of tho motive is quite irrelevant. After all is this not the usual policy of the right hon. gentleman, who is a past master in the art of the cuttlefish and who, when he wants to clarify a question, squirts a lot of black ink over and around it so that nobody can tell where it is or what it is? His argument is about a relevant to the matter that is before the committee as it is to the other side of the moon.


James Langstaff Bowman: A moment ago I asked the hon. member for Shelburne-Yarmouth if he would point out any portion of the remarks of the Prime Minister which placed the meaning upon article 1 which he and the hon. member for Vancouver Centre (Mr. Mackenzie) are trying to place tonight. I asked the question in all sincerity, and I expected an answer in the same vein.


James Layton Ralston: That was not the question which my hon. friend asked me. He asked me where the Prime Minister had guaranteed a preference. He did not ask me where the Prime Minister had put the construction on it that we put on article 1.


James Langstaff Bowman: Very well. The hon. gentleman replied that he did not expect that I would see it. Possibly not, but it seems rather strange that when the hon. member for Shelburne-Yarmouth got up in this house to speak with respect to this treaty, eight days after a written statement had been placed on record, he himself did not know what the article meant. I refer to the address he made in this house on October 20th. My hon. friend was referring to article 1, and at page 390 he asked this hypothetical question: "What do we get in this article?"
And his answer was: "I do not know."
If he did not know then, does he know any more about it now? To-night the hon. member for Shelburne-Yarmouth states that by his remarks, which were quoted by the hon. member for Vancouver Centre, the Prime Minister more or less represented to the house that there was a guarantee in connection with the list covered by article 1. But what did the hon. member for Shelburne-Yarmouth say in that regard eight days after the speech was delivered by the Prime Minister? To-night, some three weeks after the delivery of that speech which now he is trying to interpret or perhaps misinterpret, he says that clause means a certain thing. Eight days after that speech was delivered he placed an entirely different interpretation on it, and I refer again to page 390. Referring to article 1, the hon. member said:
I point again to the fact that the right hon. Prime Minister in a written statement

Referring to the speech of October 12.
-was most particular never once to state that there was any obligation on Britain to maintain its duties.
That was the position taken by the hon gentleman on October 20, but to-night he takes the position that on October 12 the Prime Minister misrepresented this article by stating that these duties would be maintained. I will just read a little more of what my hon. friend said:
I point again to the fact that the right hon. Prime Minister in a written statement was most particular never once to state that there was any obligation on Britain to maintain its duties against the world on the goods mentioned in article 1 except the commodities specified in schedule C.
So far as I am concerned, whether or not the hon. gentleman expected me to understand these clauses I see them as they were set forth by the hon. member for Red Deer. To me they are perfectly clear, and I think they are quite clear to any reasonable member of this house. There was no guarantee of any continued preference on these goods, nor can the hon. member point to any words in the speech of the Prime Minister to that effect. Certainly if one understands ordinary English and reads the list given at page 116 and 117 of Hansard he will see that we have the right of free entry in connection with the goods set out in article 1 of the agreement, and no more.


James Layton Ralston: Since two hon. members
have read some bits of what I said on October 20 I think perhaps it is only fair to myself to put on record what I did say, not the
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whole speech but the particular passage referred to, so that we may have a connected story. I did not quite think the hon. member for South Toronto would read just one portion and leave it there. The last speaker read another little bit. Let me point out that I was endeavouring to get from the Prime Minister a statement as to what was really in this agreement, and as to what assurance Canada had. I had very grave doubts on October 20, after having looked through the agreement, as to whether there was any guarantee of any margin of preference in the agreement, and I was endeavouring to find out where the Prime Minister got the authority for the suggestions he had made. I will read what the hon. member for South Toronto read a moment ago:
Article 1 does not guarantee to Canada a margin of preference-
I pointed that out at the time.
-in respect of the goods on which duties are imposed against the outside world under that act. It simply says: You are entitled to free entry. I have read the Prime Minister's speech from end to end, and I cannot find anywhere that the Prime Minister has suggested or has made the statement that Canada is to have the margin of preference represented by the difference between free entry and the amount of duty imposed against the rest of the world.
Perhaps my verbs are not very good, but there I had in mind that the Prime Minister had not pointed to any place in that agreement where there was a margin of preference guaranteed to Canada. Then I went on, and this is what my hon. friend did not read:
I think the house and the country is entitled to have the Prime Minister or some member of his government say whether or not there is, outside of this agreement itself-
I stop here to say that I could not find it in the agreement.
-any understanding of any kind on which we can rely, with anybody who is in a responsible position, that Canada can depend that the present duties being imposed under the Import Duties Act against the rest of the world on these goods, will be continued.
There I was calling on the Prime Minister to give his authority and say whether anyone in a responsible position had given that assurance. Then I went on.
Or is it possible that Great Britain, although admitting Canadian products free, is at liberty to admit the same products from any other part of the world free, thus destroying the preference?
My hon. friend from South Toronto did not read those words.
I understand that that contention is being made in at least some of the newspapers in
[Mr. Ralston.l
Great Britain. I think it is most important that we should know just what the fact is in that regard. I do not see how we can possibly go on and consider what is really in this agreement until we know that. I am not treating the agreement in the strictly legal sense that every "t" has to be crossed and every "i" dotted, although a great many eminent lawyers came over to the conference and the agreement was pretty well buttressed up in one way or another.
I dfop here to say that the hon. member for South Toronto evidently read that passage, when he referred to the crossing of "t's" and the dotting of "i's", but he did not see fit to quote me.


George Reginald Geary: I was in the house and heard my hon. friend.


James Layton Ralston: I take my hon. friend's explanation.
I do not know whether there has been any slip here, but I think we are entitled to know. The question is: Is Canada entitled to a preference in respect of the goods mentioned in article 1? If not, if Great Britain can lower or cancel the duty on the goods mentioned in article 1, there is precious little benefit for Canada in the whole of that article. My right hon. friend the Prime Minister put on Hansard the other night-
I hope my hon. friend will listen to this.
-a very long list of articles which he said would go from Canada to Great Britain under the provisions of article 1. That list will be found at page 131 of Hansard.
Then I ask:
For instance, can the 20 per cent duty be struck off wire and wire nails as against the outside world and thus destroy Canada's preference? And so with respect to the other sixty or seventy odd items on pages 131 and 132 of the Prime Minister's speech. That is the first point.
Then I go on:
What do we get in this article? I do not know.
This is what my hon. friend quoted.
We get the guarantee of free entry of these goods. Is anybody going to suggest that we would not have got it anyway, supposing the Dunning budget had been in force? Do you think Great Britain would have imposed a duty against the Dominion of Canada after the preferences that have been extended year after year and after the way Great Britain herself has acted in giving us preferences from time to time as she put duties in force? Certainly not. But my friends consider that they should be credited with a great achievement because they have got Mr. Chamberlain solemnly to sign a document declaring that we shall continue to have free entry from goods for which we have had free entry right along.
I submit, Mr. Chairman, that my position is perfectly consistent in that regard. I was pointing out the difficulties and the fact that,

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after having read the agreement, I could find nothing which indicated that there was any margin of preference. I was pointing out that the Prime Minister had shown nothing in the agreement that justified anything of that kind being supposed, and I was asking whether any assurance had been given outside the agreement itself by any responsible individual. My hon. friend from Vancouver Centre is quite correct when he reminds me that tonight is the first time I have been given an answer. I repeated my question the night before last; the Prime Minister addressed the house yesterday, but no answer was given. Tonight we have had a frank statement from the Minister of Trade and Commerce, to the effect that the preferences are only guaranteed in respect of certain articles mentioned in the schedule.


William Duff: That is because the Prime
Minister is away.


James Layton Ralston: Now I come back to the question I asked the Minister of Trade and Commerce, with regard to schedule A, whether, if duties are1 imposed after three years in respect of farm products, the words preferential margin, which are contained in schedule A, mean that Great Britain must maintain the present rate of preferential margin on Canadian farm products itemized in that schedule, or whether the maintenance of any preferential margin will be sufficient.


Henry Herbert Stevens: The undertaking is to maintain the present preferential margin. Let me explain this schedule very briefly in order that the committee may get the background of it. During the conference, when these very important matter were under discussion, it was disclosed, indeed it had already been known, that the British government had some months before appointed a commission to study the pig industry of Great Britain. The object of that commission was to ascertain what was the beet thing to do to stimulate that industry, and to anyone who knows the adaptability of that country to the raising of pigs, and also the large quantities of pig products imported into Great Britain, it will be apparent at once that it is desirable to develop that industry. This commission was still holding its hearings, and it was expected that possibly some recommendations might be made which would call for a protective measure-we at any rate would use the term in that sense-for the benefit of the British pig industry. To that we have no objection, provided, as indicated here, the preferential margins are maintained; and so, in drafting
this schedule, the language used here was regarded as the most apt to express the views in the light of that contingency. Furthermore, the three year limit is not a limitation placed upon this group of articles as against five years for others, but it was thought that possibly during the three year period a quantitative restrictive system, as they call it in Great Britain, might be worked out to replace the preferential duty system, and it is provided here that if after the end of three years such a system is considered advisable by the British authorities, they may, in consultation with the Dominion government, supplant the protective duty system by a quantitative restrictive system under mutual arrangement. In that event, in regard to bacon, for instance, we are guaranteed 2,500,000 hundredweight.


James Layton Ralston: The minister refers particularly to bacon. May I point out that it is not dealt with in any way by this schedule.


Henry Herbert Stevens: No, but it applies to the quantitative restriction policy.


James Layton Ralston: Does it apply to the preferential margin policy?


Henry Herbert Stevens: Perhaps I should have been careful not to obtrude bacon into this item. I mentioned it because I know that it is under contemplation and it is possible that some sj'stem of that kind might be applied to bacon. But our rights are preserved. I accept my hon. friend's criticism: we should not discuss that in connection with this schedule.


James Layton Ralston: I do not want to cross
"t's" or dot "i's," but the words are that after three years we shall "review the basis of preference. Does that mean the spread of preference, or what does it mean? It sounds to me as if it means the spread of preference, and when you say " preferential margins " down below, without specifying whether they are the present preferential margins, or existing preferential margins, it seems to me that possibly you will have a new preferential margin altogether after having reviewed the basis of preference.


Henry Herbert Stevens: I thought I had made it clear, but my language apparently is not adequate to deal with the matter. The point is this: In three years the basis of preference may be reviewed.


James Layton Ralston: Meaning what?

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Henry Herbert Stevens: The language of the schedule is this:
After notifying His Majesty's government in Canada either to impose a preferential duty on Canadian produce whilst maintaining the preference-


James Layton Ralston: No; it does not say the preference; it says .preferential margins.


Henry Herbert Stevens: Preferential margins, yes.
That is to say, they may review the 'basis of preference. At the present time we go in free and a certain duty applies to foreign countries, but the basis then may be 10 per cent against Canada and 30 per cent against foreign countries, thus maintaining the margin of preference. Or, in consultation with the government of Canada, such produce might be brought within any system which might be put into operation, for a quantitative regulation of supplies from all sources. That latter provision can be adopted only with the consent of and after consultation with the Dominion government. Does that make it clear?


Joseph Henri Napoléon Bourassa: Suppose it were 10 per cent in one case and 15 in the other.


Henry Herbert Stevens: The provision is to maintain the preferential margins.


Joseph Henri Napoléon Bourassa: It does not say " the ".


Henry Herbert Stevens: Preferential margins-that is, the preferential margins indicated at the present time in the schedule.


Edward James Young: No.
Mr. STEVEN'S: I can assure my bon, friends that there is no doubt in our minds as to what the intention of it is.


Mr. ELLIOTT:: We do not seem to be making much headway in getting at what article 1 really means. Perhaps we could clarify it if the minister would tell us what change article 1 makes in the condition existing prior to the passing of that article. I take it the Import Duties Act was in force before article 1 was .passed. There is no doubt about that. Article 1 reads:
His Majesty's government in the United Kingdom undertakes that orders shall be made in accordance with the provisions of section 4 of the Import Duties Act, 1932, which will ensure the continuance after the 15th of November, 1932, of entry free of duty into the United Kingdom of goods consigned from any part of the British Empire and grown, produced or manufactured in Canada which by virtue of that act are now free of duty subject, however, to the reservations set forth in schedule A appended hereto.

What is the change made or intended to be made by article 1? Does it enlarge the powers we had under the Import Duties Act before article 1 was agreed upon, or does it restrict us, and if so, to what extent?


Henry Herbert Stevens: I can answer that very
briefly, and, I trust, clearly. It is simply the difference between day and night. The leader of the opposition made it very clear when he pointed out that after November 15 the free entry of Canadian goods, as he put it, would end unless some agreement were arrived at. That's that. In the words of the article, it ensures the continuance during the life of this agreement of the free entry of goods.


John Campbell Elliott: " Subject, however, to the reservations set forth in schedule A appended hereto."


Henry Herbert Stevens: By general consent of the committee, that one line has been regarded as not affecting the rest of the article.


John Campbell Elliott: I think I know what the
minister's idea is; he is contending that the Import Duties Act is to be continued and that we are to have free entry for all commodities for which we had free entry prior to this article being agreed upon, subject to the reservations contained in schedule A.


John Thomas Hackett: From the fifteenth of
this month.


John Campbell Elliott: My hon. friend does not
get the point at all. Article 1 is restricted by schedule A; the last line of the article reading, "subject, however, to the reservations set forth in schedule A."


Henry Herbert Stevens: I do not wish to be
discourteous, but by general consent it has been agreed that in discussing article 1 we shall eliminate schedule A. Article 1 does just what the hon. gentleman has stated; the articles in schedule A are treated in a different manner and we have been discussing them from a different angle.


John Campbell Elliott: Does schedule A restrict
or extend what we had before?


Henry Herbert Stevens: Restricts, if you like. The articles enumerated in schedule A are, for the period mentioned, taken out of article 1.


John Campbell Elliott: I think I have it clear now If that is correct this means that we are no worse off than we were before the article was agreed upon except for the restrictions contained in schedule A.


Henry Herbert Stevens: We are very much better off.

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William Lyon Mackenzie King: I do not suppose the minister will say that there is any undertaking on the part of the British government to continue the Import Duties Act for five years, or will he?


Henry Herbert Stevens: I dislike repeating, but
several times tonight I have made this point very clear: In so far as the range of articles outside of the schedules of these various agreements are concerned, the British government is free to change as it likes. In the case of the numerous articles in the Canadian tariff, some eight hundred in number, with the exception of those enumerated in schedule E, we are equally free to deal with the rates of duties either up or down. I trust that is clear.


William Lyon Mackenzie King: My point is
that the Import Duties Act was introduced as a temporary measure and, as I have indicated, for the purposes mentioned. I referred to an order in council passed recently which extended certain duties imposed under the Import Duties Act. I have now found the despatch which I have been looking for and which confirms what I have said as to the purpose of the measure being, not as the hon. member for East Edmonton (Mr. Bury) has said, to help to balance the budget, but to help to balance trade.


Ambrose Upton Gledstanes Bury: I did not say it was to balance the budget.


William Lyon Mackenzie King: Yes.


Ambrose Upton Gledstanes Bury: I did not say it was to balance the budget; I denied it.


William Lyon Mackenzie King: The hon. member attributed that remark to me. I did not make that remark; I spoke of balancing trade. The Ottawa Morning Journal of October 22 contains the following despatch from London:
Duty on Imports to be Continued Britain Finds Object of Tariff Achieved to Great Extent
London, October 21.-Great Britain's thirty-three and one-third per cent tariff duties imposed under the recent general tariff act will be continued for two more years from October 25, it was officially announced today.
The immediate object of the duties, it was stated, have been to a great extent achieved as evidenced by the fall in imports.
For the third quarter of 1932, imports dropped 45 per cent, as compared to the same period in 1931, the announcement said. Nevertheless, "the menace of uneconomic foreign competition continues and is serious."


Henry Herbert Stevens: 
William Lyon Mackenzie King: No. That was
the despatch I had in mind when I spoke a moment ago.


Henry Herbert Stevens: My right hon. friend will notice that it continues for two years the duties which had previously been increased under the powers given by the Import Duties Act.


Mr. HEENAN:: I have 'been interested in the observations which have been made by hon. members behind the Minister of Trade and Commerce. They accuse the leader of this party of being inconsistent, I wonder if they know what it is all about. I wonder if they have forgotten that only a few years ago the right hon. gentleman who is now the leader of this house, the Prime Minister of Canada, promised the people that he would blast his way into the markets of the world or perish in the attempt.
Mr. SiPOTTON: Something new.


Some hon. MEMBERS:: Oh, oh.


Peter Heenan: My hon. friends may laugh, but the people of Canada are not laughing. According to the utterances of the Prime Minister, these agreements are to make the people of the world outside of the British Empire pay tribute .before they can do business in Canada. He claims that he has succeeded in shutting out the foreigners; in other words, he has shut out all the markets of the world. Instead of blasting his way into the markets of the world, he has been blasted out of the markets of the world and the people of Canada have to perish instead of the government. I wonder if the hon. members for Stanstead (Mr. Hackett) and East Edmonton (Mr. Bury) realize what is going on? Do they not recall that a special session of this house was called in 1930, and instead of the Prime Minister ending unemployment as he had promised to do-


Armand Renaud La Vergne: Once more I must ask hon. members to discuss article 1 and schedule A. Considerable time has been spent tonight in discussing previous speeches.


Peter Heenan: I should like to know how the Chairman knows that I am not discussing these matters.


Armand Renaud La Vergne: The hon. member may be correct.


Peter Heenan: I wish the Chairman would not rule against me until I ask him to. Instead of ending unemployment, the govern-
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ment placed higher duties against British commodities coming into this country. Then the Prime Minister went to the imperial conference

I am now getting on the track-and with that big stick, with that bluff he said: "This is Canada's position; you can take it or leave it." That conference was a gigantic failure, and it was adjourned until 1932. By that time the British statesmen had the measure of the representatives of Canada, and they *placed a duty against Canadian commodities to be made applicable on November 15. They then came over here with their big stick and succeeded finally in making the agreement which is now before us. The Prime Minister and his supporters are glorying in the fact that the British took off the duties which this government had caused to be put on. There has never been such gigantic bluffing in history as between this and the British government


William Duff: 1 agree with the Minister of
Trade and Commerce that perhaps we should get back to the discussion of schedule A and article 1. I am sure we all appreciate the position in which he finds himself tonight in the absence of the Prime Minister, but he has been ably supported by the hon. member for East Edmonton, the hon. member for South Toronto- and the hon. member for Stanstead. I notice in schedule A that butter is mentioned. I was hoping, when the hon. member for Stanstead was on his feet, he would tell us whether the Canadian farmer in Stanstead county or in the eastern townships generally was going to get seventy cents a pound for butter as was promised him in the 1930 electron campaign.


John Thomas Hackett: By whom?


William Duff: By the Tory party.


John Thomas Hackett: The hon. member is wrong.


William Duff: I just rose to say that in my opinion this agreement has been very hurriedly drawn. I am sure my good friend the Minister of Finance will agree with me, when I read this sentence in schedule A, that my argument is right. Although the Minister of National Revenue tried to impress upon us, I think i-t was last night, that he was present at every meeting of the imperial conference held at Ottawa, yet somebody drew up this agreement, and especially the first clause, and I am sure it was neither the Minister of National Revenue nor the Minister of Finance. Let me read it; and while I do not pretend to know the English language very well, I am
TMr. Heenan.]
sure everyone will agree with me that this sentence is not quite correct. Schedule A reads:
As regards eggs, poultry, butter, cheese and other milk products, free entry for Canadian produce will be continued for three years certain.
I never knew that eggs and poultry were milk products.


John Thomas Hackett: Butter and cheese are,
though.


William Duff: Surely. The hon. member for Stanstead, who in that county promised seventy cents a pound for butter, says that butter and cheese are milk products. He is right. What I said was:	"As regards eggs
(comma) poultry (comma) butter (comma) cheese and other milk products."


Edmond Baird Ryckman: There is no comma
after "cheese."


William Duff: If I read the English language correctly, that means that all these items are milk products.


George Reginald Geary: Will the hon. member permit a suggestion from me? Do not read it in the English language; read it in Latin-ejusdem generis.


William Duff: I can read it in Latin or Dutch or Celtic, whichever language my hon. friend desires, but what I am trying to do now is trying to read it in plain, ordinary, common sense English. This clause was drawn hurriedly. It should read:
As regards eggs, poultry and butter, cheese and other milk products.


John Thomas Hackett: No "and."


Mr. MOORE (Chateauguay):: There is a
comma after "poultry."


William Duff: Certainly, there is a comma
there, but that does not alter the fact that there is a comma after "butter." Surely butter is a milk product, but there is no comma after "cheese," so that if my hon. friend is correct in his English, there should be a comma after "cheese" as well as after "butter." The hon. member for Chateauguay-Huntingdon, surely was not at the imperial conference; he had nothing to do with this agreement. In fact, if my information is correct, neither the Minister of National Revenue nor any other minister except the Prime Minister and the gentleman from Washington had a hand in drawing up this agreement. That is what the newspapers said, and I am trying to help the Minister of National Revenue and the Minister of Trade and Commerce out.

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Edmond Baird Ryckman: Does my hon. friend believe all the newspapers say?


William Duff: My hon. friend certainly
should not object to anything in the newspapers, because whenever he needs them they give him a fairly good send-off and boost, and he receives good newspaper publicity. He takes advantage of it every time he needs it, and so does the Tory party which pays the newspaper well for it. My hon. friends opposite, who get ninety-five per cent of the newspaper publicity, advertising and everything else, certainly should not cast a slur on the newspapers. What I say is that the Minister of National Revenue had nothing to do with drawing that part of the agreement or he certainly would not have said that eggs and poultry were milk products. I say to the Minister of Trade and Commerce there certainly should be an "and." The schedule should read:
As regards eggs, poultry, and butter, cheese and other milk products.
And not the way it reads at present.


Alan Webster Neill: Some days ago, when I was
discussing this agreement in another form, I ventured to refer to the involved uncertainties of it, and I do not think a better illustration could be found of the truth of that than the debate we have had this afternoon and evening on article 1. This is not the fault of the minister in charge; there are few men, if any, in the house better able to explain the details of the measure; it is the involved Uncertainties of the agreement the minister is trying to explain that constitute the trouble. If those who took a prominent part in the formation of this agreement have such difficulty in explaining it in language we at least can grasp, what will the ordinary business man and merchant encounter when they come to apply it to their business? Even when a man of such ability as the hon. member for Red Deer in a clear-minded way tried to explain some of the difficulties this evening, evidently with a friendly desire to see the best that could be found in it, he felt it necessary to qualify his remarks before he sat down by saying that at least was the impression it made on his mind. We cannot build fish canneries or saw mills on the strength of impressions made on one or ten or even one hundred members of parliament; we must have some certainty of knowledge of what we are doing.
If I may on article 1, I should like to revert to an item that the Minister of Trade and Commerce referred to two hours ago; and
while he did it only by way of illustration, yet it happens to be a matter of importance to the province from which we both come, and it has a clear connection with article 1. I refer to the item of salmon, chilled or frozen. This happens to be a very important matter in British Columbia because it comprises two classes of fish for which there is a somewhat poor demand for canning, but for which there is an increasing demand for sale in the chilled or frozen condition. The Prime Minister, as reported on page 121 of Hansard, made this statement:
Fish products:
As a result of the conference agreement, Canada will now enjoy the following preferential rates in respect of fish products.
He then gave a table of ten articles, amongst which we find "salmon, chilled or frozen."


Armand Renaud La Vergne: Would the hon. member not be more in order on schedule C?


Alan Webster Neill: It is not in schedule C.


Armand Renaud La Vergne: Schedule C on page 7 includes "salmon, canned"; "other fish."


Alan Webster Neill: The minister having spoken very definitely about this, I think I should be entitled to make a very few comments on the subject. I do not think the minister will object to my taking up this item while we are speaking on it. It will take only a few minutes.


Henry Herbert Stevens: If my hon. friend will ask his question, I shall answer it as best I can.


Alan Webster Neill: Mr. Chairman, if you will ailow me to continue, you will then be able to give a ruling on the matter. The item to which I was alluding was "salmon, chilled or frozen," which I say is to be found only in the particular place to which I have referred. The Prime Minister defined these various articles; then he went on to say in addition: "Stabilized in schedule C." But this qualification is made by means of an asterisk and the items referred to do not include the one about which I am speaking.


Armand Renaud La Vergne: The hon. member is out of order.


Alan Webster Neill: I am talking about article 1.


Armand Renaud La Vergne: Article 1 refers to
schedule A.


Alan Webster Neill: Article 1 does not refer exclusively to schedule A.


Armand Renaud La Vergne: I am in the hands of the committee. Article 1 in the last line says "set forth in schedule A appended hereto."
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Imperial Conference-Trade Agreements


Ian Alistair Mackenzie: There are the words ''subject, however, to the reservations", and I suggest they make a difference.


Armand Renaud La Vergne: The leader of the opposition asked that the discussion be confined to the schedule, article by article.


Alan Webster Neill: Yes, quite so. I quite agree with you, Mr. Chairman.


Some hon. MEMBERS:: Hear, hear.


Alan Webster Neill: But what is article 1? What does it say? I will divide the house before I will be confined to a discussion of schedule A.


Armand Renaud La Vergne: Article 1 refers specifically to schedule A.


Alan Webster Neill: Yes, but not exclusively.


Armand Renaud La Vergne: The discussion must be confined to the article.


Alan Webster Neill: Article 1?


Armand Renaud La Vergne: Yes, schedule A.


Alan Webster Neill: Not schedule A only?


Armand Renaud La Vergne: Yes.


Alan Webster Neill: Anything in article 1 is debatable.


Edward James Young: Article 1 refers to the Import Duties Act; I suppose we can discuss that?


Alan Webster Neill: 
Armand Renaud La Vergne: So far so good.


Alan Webster Neill: Thank you, sir.


Charles Gavan Power: Fresh fish are not mentioned, but there is reference to "fish, fresh."
fThe Chairman.]


Alan Webster Neill: Do not pay any attention to him, Mr. Chairman. I do not wish to make a burlesque of the situation, because the commodity to which I am directing my attention is of importance to the province from which I come. The Prime Minister had this to say:
Pree entry with ten per cent preference is secured to us on fresh sea fish, canned salmon and other canned fish, while Newfoundland has been given Is. 4d. per gallon on cod liver oil and lid- per pound on chilled and frozen salmon. The Newfoundland salmon preference, which Canada will also eniov will be of distinctive benefit.
V hen I heard the Prime Minister make that statement I certainly thought-and I believe I had some other reason for so thinking, although I cannot recollect at the moment just what it was-I had the impression, as my friend from Red Deer says, that our share in the privilege granted to Newfoundland would be based on some specific act, item or paragraph in our agreement, and not be left, as I understand the minister now says it is, to an inferential-I think the minister used the word consequential-argument or line of thought. The argument he used, and I believe it was sound so far as it went, was that as Newfoundland had been granted a preference of three cents a pound, the British would have to put on a three cent duty against foreigners, and that as we have been given free entry we would come in under that provision. So far as he goes, I follow his argument and agree that it is sound. This advantage would be of importance to British Columbia because the three cents a pound would sometimes be better than the ten per cent we would otherwise enjoy. In my view it is not well to deal with it merely as a matter of inference.
For instance, as has been suggested, suppose that in the course of time Newfoundland found it was desirable

and this might well happen-to make another kind of bargain with Great Britain. Suppose they gave way altogether on this chilled or frozen salmon, which perhaps might no longer interest them, and took in exchange some other preference in connection with something of more importance. Suppose they made an agreement with Great Britain to abandon this three cents-what position would we be in then? So far as British Columbia is concerned we would be in a horrible position, and I suppose people on the Atlantic coast would suffer equally. The fact would be that W'e would have no duty at all; we would not get even the ten per cent which is ordinarily given on all goods. We would lose the ten per cent.

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because that preference is imposed on "lish, fresh, sea," and I do not believe any lion, member would call frozen salmon fresh sea fish. Therefore we receive the three cent per pound preference only by virtue of coming in under the cloak, or by the back door, of the agreement made with Newfoundland. It is only by that back door method that we can have any definite idea as to what we may expect. Then we are always subject to the hazard of losing it in the manner I have indicated, if Newfoundland chose to get rid of it. I ask the minister if he will explain the situation. If that did happen, would we fall back on the ten per cent imposed by section 4 of the British Import Duties Act of 1932? We would receive ten per cent on fish, fresh, sea, on canned salmon or other canned fish, but would we receive it on chilled or frozen salmon?
I have no desire whatever to delay the committee unnecessarily or to embarrass the minister, but I should like him to take cognizance of that point of view. As I said before we are receiving a preference only by a back door method, namely, that of coming under the cloak of Newfoundland. If Newfoundland chose to change her agreement with Great Britain we would be out in the cold. Not only would be lost the three cents per pound, but we would lose the ten per cent as well.


Henry Herbert Stevens: I believe there is no
ground for my hon. friend's apprehension, but I am afraid I must go outside article 1 to explain the point. Canada is assured by the terms of ihe agreement the ten per cent duty on "fish, fresh, sea," "salmon, canned," "other fish, canned," and so on.


Alan Webster Neill: Yes, but not on salmon chilled or frozen.


Henry Herbert Stevens: Just a minute. We are assured of that preference under the terms of the agreement. In addition to that however, inasmuch as Great Britain under the schedule to Newfoundland, which is referred to in article 1 as "goods consigned from any part of the British Empire," is obligated to impose a duty of three cents a pound, or one and a half pence, on chilled and frozen salmon, Canada will also under that enjoy a preference.


Alan Webster Neill: How and why?


Henry Herbert Stevens: She will enjoy a preference of that amount.
Mr. NE'ILL: The minister has said so, but why? After all he is not going to be with us forever. Where is that provision in the agreement? When we come to demand it, where shall we find it?


Henry Herbert Stevens: I assure the hon. member it is unavoidable, because-


Alan Webster Neill: How?


Henry Herbert Stevens: Well, I will show the hon. member how. I have gone over the point so often to-night I am almost ashamed to do so again. The answer is that it is because we are assured the free entry in article 1, and we all agree on that. That is as clear as the noon-day sun. In the second place we are assured under article 1 a free entry of goods produced in any part of the empire and, similarly, goods in Canada enjoy that free entry. Then, Great Britain has undertaken to obligate herself with Newfoundland for five years to maintain a duty of three cents per pound on chilled or frozen salmon. How they can on behalf of Newfoundland maintain a duty against foreign countries and at the same time give us free entry without Canada enjoying the preference is beyond me.


Alan Webster Neill: Do they guarantee to keep up this preference with Newfoundland for five years?


Henry Herbert Stevens: Yes.


Alan Webster Neill: That is in the Newfoundland agreement?


Henry Herbert Stevens: Yes.


James Layton Ralston: All I say about this sort of left-handed agreement is this:	If these
agreements are made from the point of view of Canada they should be included in the Canadian agreement. I do not think it is quite fair to the committee or to the house oi to the country to suggest that something is being done by these agreements the nature of which we do not know. We simply have to put these agreements to one side. They were obtained by Canada not in connection with the conference at all, but by reason of the fact that two other countries made an agreement which enures to our benefit; because you cannot put up duties against the world without automatically giving us the benefit of that preference. How long the duties are going to stay in force is entirely a matter between the two countries concerned, with which we have nothing to do. Evidently they are not important to Canada or else these concessions could not have been obtained.
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Imperial Conference-Trade Agreements


William Duff: The minister said in reply to the hon. member for Comox-Alberni (Mr. Neill) that there was a preference of one and a half pence on frozen salmon entering Great Britain so far as Canada is concerned, also a ten per cent preference on fresh fish. I do not want to deal with the fish schedules at this moment, because I presume we can deal with them later on. I do not wish to delay the committee on schedule A, but I do object to the minister saying that there is a preference on fish. Fish has always entered Great Britain free of duty and where an article has entered a country free of duty, and is going to continue to enter free of duty, there is no preference. If up until the conference there had been a duty of one and a half pence or three cents a pound on frozen salmon entering Great Britain from Canada or Newfoundland, and that duty were taken off, it would be a pieference. But as there has been no duty at all, there is no preference being granted to Canada. All that is being done is to impose a duty against foreign fish entering Great Britain. As far as I am concerned. Mr. Chairman, I am willing to allow' schedule A to pass if it is understood that we can discuss fish, frozen or anything else, when we come to schedule C. Am I right in that?


Armand Renaud La Vergne: Yes.


Alan Webster Neill: I think the minister has been misinformed or has misinformed me in connection with this matter. He told me just now that our inheritance, so to speak, from the agreement with Newfoundland was guaranteed for five years by the fact that the British government had an agreement with Newfoundland for five years, and he quoted chilled or frozen fish as being contained in that guarantee. But that is in schedule B. and schedule B is not on the conditions that I have narrated. It is schedule C that is on those conditions. Article 2 says:
His Alajesty's government in the United Kingdom will invite parliament to pass the legislation necessary to impose on the foreign goods specified in schedule B appended hereto, the duties of customs showm in that schedule in place of the duties (if any) now leviable.
It is in that schedule that chilled or frozen salmon comes, and there is no permanence about that preference because it is in the category of duties which may be changed. But the ones which cannot be changed are covered by article 3, which reads:
His Majesty's government in the United Kingdom undertake that the general ad valorem duty of ten per cent imposed by section 1 of the Import Duties Act, 1932, on the foreign goods specified in schedule C shall not be reduced except with the consent of His Majesty's government in Canada.

But schedule C comprises only codfish and marine shells. The minister has been quoting the wrong schedule. It is in schedule B that chilled salmon comes.


Henry Herbert Stevens: Will my hon. friend permit me? The wording is slightly different, but under article 2 of the Newfoundland agreement the United Kingdom undertakes to impose certain duties, and article 9 provides that the agreement is made for a period of five years. In other w'ords, the United Kingdom imposes duties as a part of this agreement. The agreement stands for five years and there is not a doubt in the world that it cannot be changed without the consent of both parties, as is common to all agreements.


Alan Webster Neill: Only with respect to the
items in schedule C, and chilled or frozen salmon is not in that schedule.


Henry Herbert Stevens: Great Britain could not
take the duty off without violating the treaty unless it had the consent of the government of Newfoundland. Article 3 refers to schedule C, regarding the continuance of the ten per cent duty now standing against foreign countries.


Alan Webster Neill: We have spent the last three or four days discussing v'hether Great Britain has the right to change the duties without our consent, and it has been generally agreed, I think, on both sides that she can change those duties except in particular schedules- schedule C in this case, which they agree not to change without our consent. But this particular item that I am speaking of 'is not in that category; it is embraced in a schedule which Great Britain can change without our consent.


Henry Herbert Stevens: No, I am sorry.


Alan Webster Neill: You can of course simply
talk me down. But the whole house has agreed in the last few days that Great Britain can, except in these particular things that are earmarked in a particular schedule, change the duties without our consent. What is the use of putting that in one particular schedule if it is not intended to do something different in connection with the other schedules? There are two classes of schedules. In one they can put a duty on and change it without our consent; in the other thej' cannot change the duty without our consent. The agreement lasts five years subject to certain conditions. I claim that in connection with this particular item we are getting the wrong end of the deal. We have got into such a posi-

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tion in regard to this important fish product in British Columbia that we may lose out altogether, and now we cannot be guaranteed the ten per cent preference because it may be changed without our consent because it appears in the wrong schedule.


Henry Herbert Stevens: My hon. friend is mistaken.


Alan Webster Neill: I hope I am. I may say,
Mr. Chairman, that I have had some scruples of conscience to begin with in voting against this measure on account of some of the hoped for benefits in connection with fish, but I do not have the same scruples now.


Mr. MacLEAN:: By schedule A agricultural products are guaranteed free entry into Great Britain for only three years certain. In all the debate that has been going on in the house I have not heard from hon. gentlemen opposite the explanation of this discrimination against agricultural products. Our good friends the manufacturers have secured a preference in favour of their goods for five years. They were in Ottawa, a whole army of them, seeing that the agreements were so drawn that the manufacturers of Canada would get every benefit that was coming. But our agricultural friends not being so well-organized, are given free entry for their products for a period of only three years certain. Now, if this agreement is as good as our hon. friends across the way would have us believe, if it is a good thing for the manufacturers to have free entry guaranteed for their products for five years, why is it not an equally good thing for the agriculturists of this country to have the same privilege? Our friends across the way were going to do something for the dairy industry. It was to be put on a sure footing and be given the benefit of an increased price. The Englishmen may be a little slow, but I think they were just a little too smart for hon. gentlemen opposite when this agreement was drawn. A clause was .put in regarding wheat that it would only be granted free entry if Canadian producers were willing to sell it at the world's price. Now so far as butter and cheese is concerned, the world's price governs those commodities and consequently there was no need of putting in the rider with respect to butter and cheese which was put in with regard to wheat, because they knew it would have to sell at world prices. I would like to ask the minister what powers were behind those drawing up the agreement which caused them to limit the preference to agricultural products for a period of three years. In this connection there is also the question
of changing from the free entry we always had for butter and cheese. As the hon. member for Bow River pointed out the other night, the ad valorem duty has been changed to a specific duty of 15s. per hundred weight. Do our good friends always expect to hold the price of butter down to 25 cents a pound? As soon as the price of butter commences to rise we will begin to lose the preference we already had.
Another question dealt with the other night by the right hon. Prime Minister was unfair competition. Has the minister given consideration to the fact that New Zealand and Australia bonus their dairy industries, and that we have to compete in the British market with a bon used product? Last year we were told that the bonus of five cents a bushel on western wheat was being given because oi the increased tariffs the farmers would have to pay. If that were so they should be given a bonus of ten cents this year to compensate for the increases that will result from this agreement. If it was necessary for the farmers of the west to have that bonus last year it is more than ever necessary this year, when this agreement goes into effect. But the government has again increased the duty, and it has taken away the bonus.
I should like the minister to answer these questions: First, what power behind the throne forced the government of this country to agree to the three year free entry for agricultural products? Second, why was the duty on butter changed from an ad valorem duty to a specific duty? Third, why must Canada compete with the bonused products of other countries?


Henry Herbert Stevens: Again I must apologize to the committee for repeating what has been said so often tonight, and I am sorry my hon. friend was not in the house when this whole matter was fully explained. I will try to answer his questions as briefly and as categorically as possible.
In the first place my hon. friend asked what power behind the throne induced the government to arrange for a preference for the manufacturers and not for the primary producers. Manufactured goods come under the general list of items which have been describe! here at such great length tonight as having no preference guaranteed at all, so nry hon friend is answered in that regard. The items on which the preference is guaranteed are mainly farm commodities and other primary products such as lumber and minerals.
Then my hon. friend asked a question with regard to the duty on butter, which is a
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specific duty of 15s. per hundredweight. That is much the more preferable form of duty for an article such as butter, the price of which fluctuates so much on the market. With an ad valorem duty, the lower the price of butter the lower would be the protection.
My hon. friend asked also why the three year period was agreed to in connection with these agricultural products. As I explained at great length a short time ago, they are not limited to three years. Let me make that clear to my hon. friend. At the end of three years provision is made for a possible change of the basis upon which the preference is granted. That is, the British government will be at liberty to impose a duty on these Canadian goods, if they so desire, provided they maintain the preference. They may do that, or after consultation and with the consent and agreement- of the Dominion government a quantitative, restrictive regulation may be imposed, which, by the way, might be an even more beneficial method.


Alfred Edgar MacLean: The minister did not deal with the question of bonused products.


Henry Herbert Stevens: That question does not arise under this agreement, and I do not think we have any right to enter into a discussion of it.
Mr. \ OUNG: My criticism of article 1 is that hitherto all the products mentioned in schedule A-that is, poultry and dairy products-have enjoyed free entry into the British market. Now schedule A clearly intimates that at the end of three years the British government, in order to protect their fanners from the competition of Canadian farmers, probably will see fit to deny us that free entry for our products. It may be said that this is Great Britain's own affair, that she can do as she likes with her tariff. That is very true, but hon. gentlemen opposite have been boasting that Britain's adoption of a protective tariff has been due to the action of our Prime Minister, and the Prime Minister said last session that in framing her tariff legislation Great Britain was modelling it after the legislation that he brought into this house. That puts him in this position, then, that he is responsible for the fact that we are going to be denied free entry into the British market for our poultry and dairy products.
Article 1 agreed to.


Armand Renaud La Vergne: Shall schedule A carry?


Some hon. MEMBERS:: Carried.
Schedule A agreed to.

On article 2:
His Majesty's government in the United Kingdom will invite parliament to pass the legislation necessary to impose on the foreign goods specified in schedule B appended hereto, the duties of customs shown in that schedule in place of the duties (if any) now leviable.


Some hon. MEMBERS:: And schedule B.


Armand Renaud La Vergne: We will consider schedule B together with article 2.


Edward James Young: With regard to the first item in schedule B, " wheat in grain," can the minister now give me definite information as to what the British government's attitude will be towards wheat going through American ports?


Henry Herbert Stevens: I do not think it is possible to add to the clarity of language set forth in article 12 of the regulations made by the British committee, under the Import Duties Act. It was read to the house the other day and I can look it up and read it again if the hon. gentleman so desires. It must be borne in mind by the committee that this is a question which, naturally, is controlled iby the British government, by the regulations passed by that government, which regulations are very clear and well understood. I do not know that it would be profitable to enter into a long discussion of the matter, but I am willing to read the regulation again.


Edward James Young: I do not wish to impose upon the minister, but I wish he would read the regulation.


Ian Alistair Mackenzie: On a
point of order, Mr. Chairman, I submit that article 4 should be read before schedule B is discussed, inasmuch as one is a qualification of the other.


Armand Renaud La Vergne: Article 4 reads:
It is agreed that the duty on either wheat in grain, copper, zinc or lead as provided in this agreement may be removed if at any time empire producers of wheat in grain, copper, zinc and lead respectively are unable or unwilling to offer these commodities on first sale in the United Kingdom at prices not exceeding the world prices and in quantities sufficient to supply the requirements of the United Kingdom consumers.


Henry Herbert Stevens: May I now reply to my hon. friend from Weyburn by reading article 12 of the regulations under the Import Duties Act:
12. Where empire goods consigned to Great Britain or Northern Ireland have been transshipped en route, or have been shipped from a foreign port after overland transit from the
empire country of origin, the importer at the

Questions
time of making entry will be required to produce the through bill of lading or railway consignment note from the country of production to Great Britain or Northern Ireland in support of the certificate of origin. Where a through bill of lading or consignment note is not available, the invoice, local bill of lading or consignment note from the original point of origin, and a certificate of arrival or landing at, and exportation from, the port of transshipment will be required. Such certificates are to be signed by the proper colonial or foreign customs officer at the port of transshipment, and in the case of the latter the signature must be visaed by the British consular authority. It is essential to prove that the goods were consigned from a part of the empire to Great Britain or Northern Ireland, and not to a foreign country from which they were subsequently reconsigned to Great Britain or Northern Ireland.
Progress reported.
On motion of Mr. Guthrie the house adjourned at 10.45 p.m.
Thursday, November 10', 1932