1933-04-11

STATUTE OF WESTMINSTER


[Stage Direction]
Hon. HUGH GUTHRIE (Minister of Justice) moved for leave to introduce Bill No. 74, respecting extraterritorial operation of acts of the parliament of Canada.
He said: Mr. Speaker, may I ask for the unanimous consent of the house for the purpose of introducing a bill to give extraterritorial operation to the acts of the parliament of Canada pursuant to the statute of Westminster. If I might have the opportunity now of introducing it, I should be obliged.
In so doing I should like to mention that this particular bill does not refer to section 1024 of the criminal code. The law officers of the Department of Justice have advised me that it would be better to add an express clause to Bill No. 71, which is now before the house for the reenactment of section 1024 of the criminal code. I mention this matter because the hon. member for Quebec East (Mr. Lapointe) has a similar proposal in a bill which he introduced only a few days ago.
Motion agreed to and bill read the first time.

[Stage Direction]
On the orders of the day:
Right Hon. R. B. BENNETT (Prime Minister):: Mr. Speaker, a week ago to-day the hon. member for Winnipeg North Centre (Mr. Woodsworth) asked a question with respect to the visit of a Japanese warship to Vancouver. The question was asked without
notice, and I gave him a very unilluminating answer. I proposed later to give him a detailed answer, but he was not in his place. As he has not been in his place for the last few days perhaps I should now answer his question, because there has been a great deal of comment in the newspapers for some weeks with respect to this visit and its so-called imperialistic tendencies.
The hon. member's inquiry presumably relates to the visit of a Japanese training squadron, consisting of two cruisers. In October, 1932, the Japanese minister inquired from the chief of the naval staff as to whether there would be any objection to the proposed visit on the part of the Canadian government. The chief of the naval staff was authorized to advise the Japanese minister unofficially, there would be no objection to the visit of this training squadron and, on the twenty-first January, 1933, a formal request for such consent was addressed to the Secretary of State for External Affairs, by the Japanese minister. The formal consent of the Canadian government was communicated to the Japanese minister by note dated February 2, 1933.
Arrangements were made by the interested departments of the Canadian government for harbour and landing facilities, police, customs, immigration and other details, and the necessary information was communicated to the appropriate authorities of the government of British Columbia.
Commander T. Seno of the Japanese navy, and the Japanese consul at Vancouver are, with the authority of the Japanese minister, acting as liaison officers between the local Canadian officials and the Japanese squadron.
The Japanese training squadron has visited both Canada and the United States frequently, in the course of the last ten years. The giving of the consent of the Canadian government to this visit, and the arrangements for courteous treatment, are in accordance with international custom and practice.



PENSION ACT AMENDMENT

[Stage Direction]
On the orders of the day:
Hon. IAN MACKENZIE (Vancouver Centre):: Mr. Speaker, I should like to ask
the Minister of Pensions and National Health if he intends to introduce legislation during the session to amend the Pension Act, and if so, when?
Hon. MURRAY MaoLAREN (Minister of Pensions and National Health):	I desire to
say a bill will be 'brought down within a few days.
Unemployment Relief



GRAIN COMMISSION REPORT

[Stage Direction]
On the orders of the day:
Hon. H. H. STEVENS (Minister of Trade and Commerce):: Mr. Speaker, yesterday the
hon. member for Lisgar (Mr. Brown) asked a question regarding the tabling of the annual report of the Board of Grain Commissioners for the crop year ending July 31, 1932. I will table now two unrevised copies. It will be recognized by hon. members that this report, when sent to the printers, must be sent out to the Board of Grain Commissioners for revision, and it is now in their hands being revised. So while I table the two reports at this time it is understood they are unrevised, and there may be some typographical errors in them.



UNEMPLOYMENT RELIEF


[Stage Direction]
On the orders of the day:
Hon. ERNEST LAPOINTE (Quebec East):: Mr. Speaker, I should like to ask the Minister of National Defence (Mr. Sutherland) whether the report is true that thousands of unmarried unemployed will be given work at Valoarbier camp, and if so what sort of useful work will they be required to do.
Hon. D. M. SUTHERLAND (Minister of National Defence). Mr. Speaker, the answer is yes. Probably there will be about a thousand single, homeless, unemployed men employed at Valcartier camp. Largely they will be drawn from Montreal, because there is a necessity of getting some mem out of that city. A good deal of work can be done by way of clearing roads. Sooner or later probably some new buildings will have to be erected there to replace the present arsenal at Quebec. However, that is not in immediate contemplation. At present certain preliminary work such as levelling the ground and work of that kind will be done. I have no doubt the hon. member will be quite pleased with the work done at that point.


Mr. MERCIER (St. Henri):: What salary
basis will apply?


Mr. SUTHERLAND:: Twenty cents a day i3 the allowance paid to the men.


Ian Alistair Mackenzie: Is that
the same allowance that is given throughout Canada?


Donald Matheson Sutherland: Yes.
'Mr. MacLaren.]



THE BUDGET


[Stage Direction]
The house resumed from Monday, April 10, consideration of the motion of Hon. E. N. Rhodes (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, the amendment thereto of Mr. Ralston and the amendment to the amendment of Mr. Lucas.
Mr. ANGUS MacINNIS (Vancouver South):: Mr. Speaker, like many speakers who have preceded me in this debate I find much in the budget I do not like. However I am going to refer particularly to only one item, namely that which affects those civil servants who are in receipt of pensions for war services. I am not going to say very much concerning this item because I have been given to understand that the government have been discussing the matter and will probably revise the proposal as it appears in the budget. I hope they will do so, because I can see no justification for the government dealing differently with civil servants in receipt of a pension than with civil servants in receipt of any other income. I sincerely hope that they will not proceed with this item as stated in the budget.
However, I cannot say that I am particularly disappointed in the budget, as I do not see that there is much that the government can do as long as they continue along the lines they are following at the present time. It seems to me that there are two courses open to the people and governments of the world at this time. The first is to make capitalism function, that is to make it provide the people with the means of life. I believe governments are doing that to the best of their ability, though without very much success. The other course, and I think a much better one, would be to realize that we have reached a stage in our industrial development where the policies of the past no longer suffice and that we must adapt ourselves to the new conditions that almost everyone to-day admits are here. However, I do not expect that the government for some time will take that position. Until they do I see no alternative except a continuance of budgets such as we have at this time, each worse than the one preceding it. The government seem to have abandoned every effort to do anything in a constructive way. The hopeful declarations and optimism of 1930 seem to have evaporated into the mists of

The Budget-Mr. Maclnnis
hopelessness and- despair of 1933. But I would like to point out that this is the same Dominion of Canada which the Prime Minister so eloquently and fervently eulogized during the election campaign of 1930. The natural resources of that time are still here, the soil is just as fertile, the mechanical means of production are still here in all their former efficiency, and the human element is still with us as capable and as willing as it was in 1930. Yet hopelessness, starvation and misery stalk the land, while the government stands impotently by hoping that something will turn up that will get us out of our difficulties.
I referred to the optimism of the Conservative party in 1930. Let me quote from a speech by the Prime Minister at that time- and may I say that I am not at this time quoting it to draw attention to promises made, I am quoting it to show why it is that he cannot do anything, no matter how much he may want to, unless he breaks the bounds within which he formerly worked and which restrict him at the present time. This is from a speech made at Renfrew, Ontario, on July 16, 1930, reported in the Ottawa Journal of July 18. He said:
There is no excuse for unemployment in our country. . . . There is no excuse for poverty. We have the people and the resources. We have the capital, but capital will not allow itself to be used unless there is stability and certainty.
I wish to read this again as I am going to draw from it a conclusion different from that which was drawn, I believe, when I heard it quoted in the house once before.
There is no excuse for unemployment in our country. . . . There is no excuse for poverty. We have the people and the resources. We have the capital, but capital will not allow itself to be used unless there is stability and certainty.
Stability and certainty of what? What is capital used for? Used to make a profit. [DOT]And unless there is stability and certainty of profit, the owmers of capital will not allow it to be used. Now note the assertion, "We" have the people, "we" have the capital. The people and the capital are put in the same category, and the "we" who have the capital are the "we" who have the people. And the "we" who have the capital and the people will not allow the capital and the people to come together unless there is certainty of profit, and stability of profit. There you harm the reason why the Prime Minister did not and cannot end unemployment no matter how much he wants to. It is because the capitalist class of this country will not allow him to. World development has come to the stage where it is SS719-247
no longer possible to invest with profit or to make a profit, consequently it is impossible to put an end to unemployment.
Unemployment is not a new thing. Unemployment we have always had with us since we have had capitalism. As a matter of fact it is absolutely essential to capitalism, and it will be with us as long as we have capitalism. Every time profits are created unemployment is also created, because profits are made out of the surplus values that the working class produce, the surplus value over and above what they receive in wages; and because over a cycle of time these surplus values accumulate to such an extent that industry has to slow down in order that they may be consumed when production is not taking place. Now I maintain that there you have the reason why the government could not end unemployment, granting of course that the will to end it was there.
Let me put alongside of that statement by the Prime Minister the following statement of the Minister of Finance (Mr. Rhodes) in his budget speech of March 21, as reported at page 3209 of Hansard. In referring to the banks he said:
The annual bank statements which have been issued recently indicate an exceptionally strong and liquid position, while the chief concern or our banks would appear to be the difficulty of finding satisfactory outlets for the investment of their surplus reserves.
"Satisfactory outlets for the investment of their surplus reserves" means investments giving a profitable return on capital. Because these satisfactory outlets cannot be found the industry of the country languishes, regardless of the fact that people are in need. There again you have the nature of capital and its function under the present system; that is to produce profits for its owners.
To substantiate further my contention as to the nature of capital, let me refer to a speech made by the hon. Minister of Trade and Commerce (Mr. Stevens) before the Association of Automotive Engineers in the city of Toronto on October 5th last year. According to the report, Mr. Stevens asked the engineers if when considering the introduction of certain progressive machines, they had thought of the problem they were laying on the doorstep of the government of their country when machines displaced thousands of workingmen. It was that vital problem they should consider, he said. I maintain it is not the automotive engineers only who should consider that vital problem, it is the government of the day, if they are going to



The Budget-Mr. Maclnnis
allow the owners of machinery to use that machinery only when profits can be made. He said:
We are choked with goods, yet it is not a matter of too much goods but it is the distributive system that is at fault.
The report goes on:
Consideration of the last three years had led him ... to the strange fact that the so-called depression was a depression resulting from plenty. Plentiful supply of goods was the chief embarrassment.
There you have the nature of capital, producing goods not to supply human needs but to be sold, and if the would-be purchasers have not the price the goods are not sold. Let me say that the goods produced in a country never can be consumed within that country under capitalism, because under our method of production and distribution the purchasing power is not provided. Now 1 will quote from the report of the speech of the Minister of Railways and Canals (Mr. Manion) before the Canadian section of the American Water Works Association on March 23 of this year:
"This crisis of abundance," the speaker continued, "made us wonder what was wrong with our system when we could erect so efficient a machine for production and yet have such suffering."
We need not wonder why we have such suffering; the wonder would be if we did not have it, considering the purpose for which the machine is made and the way it operates. Then the minister went on:
He was certain that there was no one remedy; it could be solved by no one country, nor a single leader. The main cause for the whole situation, he thought, was the war, which had left in its wake debts, the Russian experiment, nationalism and restriction of trade, lowering of commodity prices and unemployment.
The war is responsible for a great many things, but like everything else the war too had a cause. May I say just here that unemployment to-day is caused by the same thing that brought about the war of 1914, that is, capitalism and the impossibility of finding markets for the production of the workers of the world. That was the cause of the war; that has been the cause of the unemployment and distress which we find all over the world to-day. That a war of destruction should cause a crisis of abundance is something beyond my comprehension, and I should like the Minister of Railways to explain it.
Then yesterday we heard the hon. member :or Stanstead (Mr. Hackett), who is not in
*iMr. Maclnnis.]
his seat at the moment. In concluding his remarks he made a very peculiar statement, bearing in mind that we have an embarrassment of plenty and a crisis of abundance. He said:
If our people can be made to realize that services must be paid for, and that the people must pay for them, they may be willing to yield up in aid of economy a good many of the excellent services which are being lavished upon them at the present time, not because those services are not well administered, not because they do not add much to the ease of life, but because at the present time the Canadian people cannot afford them.
Surely we have a confusion of thought here. The Minister of Trade and Commerce (Mr. Stevens) says that a plentiful supply of goods is the chief embarrassment; the Minister of Railways and Canals tells us this is a crisis of abundance, and the hon. member for Stanstead comes along and says we must give up many of the things we now enjoy because we cannot afford them. The hon. member tells us we must economize. What are we to economize on? I should like to ask. Every time we economize-and we have been doing nothing else for the last three years- we further accentuate and add to our difficulties. Are we to economize on wheat and other food stuffs when we have more in the Dominion of Canada than we know what to do with, and when they will have to be destroyed if they are not consumed? Shall we economize in our use of clothing when there is a super-abundance of the raw material out of which our clothing is made and of the machines and workers to make it? Must we economize in the use of our railways or our hydro electric power? Shall we economize in our education, in our sanitary improvements or the thousand and one things which were not known to our fathers but which have resulted from the accumulated labour and knowledge of countless generations? Of course not. We should not economize; we should find ways and means of breaking away from the dead weight of privilege and monopoly which exacts its tribute from every productive effort. Let us hope the viewpoint held by the hon. member for Stanstead is not shared by very many people in the Dominion of Canada to-day. I should like to commend to the hon. gentleman a statement made by a man who has been quoted in this house very frequently. For that reason I have a little hesitancy in reading this quotation, but I believe it is so much to the point at present that the time of the house will lbe well spent in listening to it. I quote from Sir Arthur

The Budget-Mr. Maclnnis
Salter's book Recovery. In the epilogue we find the following:
Before the vast magnitude of the tasks ahead, man's spirit has for the moment faltered and his vision contracted. The public mood is apprehensive where it should be bold, and defensive where broad and generous policy is most required. Everywhere men fly to new tariffs and restrictions, to nationalist policies, domestic currencies, parochial purchasing and personal hoarding-like frightened rabbits each scurrying to his own burrow. Surely it is for the moment only. Which country of us has not, but a few years since, shown the resources we now require of courage, of personal devotion, of industrial and financial leadership, of public direction, in a need no greater and in a cause less worthy? We are, if we could but grapple with our fate, the most fortunate of the generations of men. In a single life time science has given us more power over nature, and extended further the range of vision of the exploring mind, than in all recorded history. Now, and now only, our material resources, technical knowledge, and industrial skill, are enough to afford to every man of the world's teeming population physical comfort, adequate leisure, and access to everything in our rich heritage of civilization that he has the personal quality to enjoy. We need but the regulative wisdom to control our specialized activities and the thrusting energy of sectional and selfish interests. To face the troubles that beset us, this apprehensive and defensive world needs now above all the qualities it seems for the moment to have abandoned-courage and magnanimity.
I would commend this quotation to the attention of the hon. member for Stanstead; I should like him to ponder it and see if there is any reason in the world why we should economize when we have so much material upon which to draw.
The only hopeful aspect of the world situation, according to the remarks of the Minister of Finance (Mr. Rhodes), is the world economic conference which is to meet in London some time in the future. Even here the minister admits that the success of the conference rests on the solution of many of the problems which now are being discussed, such as reparations, the settlement of war debts, the disarmament question, and so on. If the success of the disarmament conference however, is any criterion of the success of the world economic conference, I believe we shall have to look elsewhere for a way out of our difficulties. It seems to me that only an incorrigible optimist could look hopefully for any successful result from the world economic conference. Cooperation, like charity, should begin at home, and before we look to London for cooperation with the nations of the world we should look for ways and means of removing the obstacles to cooperation here. It seems to me that that would be a Canada first 53719-247J
policy worthy of the effort. However, for this government, considering their attitude since assuming office in 1930, to look beyond Canada is a hopeful indication. In 1930 we had the Canada first policy, and in 1932 we had an empire policy. We were then told that we were going to have the rest of the world pay tribute to us. Now it seems to me that if we are to have international cooperation we cannot bring it about so long as we exact tribute from the rest of the world; we cannot go to the world economic conference in that spirit. We must go there with open arms, willing to cooperate.
I have often wondered how much the Canada first policy depended on the fact that there was a Labour party in office in Great Britain in 1930. The events of the time would lead one to believe that our imperialists were preparing ito cut the painter in case the Labour party in Great Britain took steps to end capitalist exploitation. In any event, we found the great empire party, that is to say the empire party of former times, coming out for the first time with the Canada first policy as the battle cry. Then we had the special session of parliament when imperial preferences were reduced; that is, the tariffs were increased against Great Britain. The Prime Minister then went over to Great Britain to attend the Imperial economic conference, where he made his proposals which were so very cleverly designated by the Right Hon. J. H. Thomas. Of course, we had also our High Commissioner, the Hon. Howard Ferguson, stating that he accepted the position in order to save Great Britain from the socialists.
However, 1930 passed on, and with it went the hope of settling our problems through the Canada first route. In 1931 there was an
election in the motherland and Great Britain was made safe for capitalism once more; the empire was saved for capitalism. Then our Prime Minister went across to the old land, but this time he left his bluster on this side of the Atlantic. Then came 1932 and all our hopes were based on the imperial conference; we were told there would be wonderful results. Some of us were rather doubtful of governments being able to increase trade without increasing purchasing power, and the trade returns would seem to indicate that our fears were justified. The imperial conference having proved as fruitless as the Canada first policy, we are now asked to look forward to a world economic conference to settle the world's difficulties. Let me warn this house


Mr. THOMAS CANTLEY (Pictou):: Mr. Speaker, before forgetting to do so, I should like to compliment my fellow Nova Scotian the Minister of Finance (Mr. Rhodes) upon the splendid presentation he made when delivering his budget speech. While I cannot equal the eloquence of the hon. member for Inverness (Mr. Macdougall), I none the less agree fully with his opening remarks of yesterday when referring to the finance minister. By virtue of the right of every member of parliament to ask for the righting of grievances before granting supply, I desire ts say that I dissent from some of the proposals made by the Minister of Justice (Mr. Guthrie) in connection with the penitentiaries appropriations for the present fiscal year. So far this session I have not burdened Hansard' or bothered the house with any lengthy dis-
The Budget-Mr. Cantley

cussion and I now crave indulgence if my remarks seem to be unduly personal. As I proceed, I fancy that the object I have in mind will become apparent.
After eight and forty years of continuous work, I planned a holiday a few years ago. I planned to visit portions of the old country and Europe which I have not seen since sometime before the war and in carrying out that plan I sailed from Montreal on May 6, 1921, making my thirty-third trip across the Atlantic on one of the new Canadian mercantile marine boats, the S.S. Canadian Commander. The passage was a slow one, occupying a fortnight. As I had nothing to do I mingled with the members of the crew, among whom was a young chap named Harris. At one time this man had been a member of the crew of one of the Thompson liners running out of Saint John, New Brunswick. I should like to relate his experience as an illustration of the prison discipline in the old country and what it means to those who have had the opportunity, the privilege or the misfortune-it depends upon how you look .at it-to experience it. Upon reaching Liverpool young Harris deserted, got into bad company and undertook to do some house-breaking. Later on he was apprehended by the police, convicted and sentenced to prison at hard labour. If my memory serves me right, he was sent to AVormwood Scrubbs. His experience there, illustrating what hard labour in a British prison means, is, in substance, as follows: For some weeks after sentence be was given daily alternating periods of exercise on the treadmill, followed with an equal period of picking oakum. I fancy none of my hon. friends have had much experience in picking oakum. This means teasing by hand old, hard, tarred hemp rope into its original fibre which is afterwards used for the caulking of ships. The treadmill is built inside a wooden tank which is connected with a water main. The treadmill is geared to a pump, and while the treadmill continues to work, it pumps the water out as fast as it comes in. If the man ceases to pump, the water rises and drowns him out; he has either to pump or drown. After forty minutes of this type of exercise, he is given forty minutes picking oakum, the idea being that a period of forty minutes on the treadmill is about as much as he can stand physically.
He had five hours of this exercise in the forenoon. Then he got some dinner or lunch composed of thin skillet and black bread which is a mixture of whole wheat and barley. He got just sufficient of this to maintain life and a little more and at the end of six weeks

he had lost forty pounds in weight. His narrative in regard to the scarcity of food is very interesting. He said that every crumb that could be salvaged in any way or stolen from somebody else, was utilized. If a crumb fell on the stone floor, he stooped down, moistened his finger, picked up the crumb and was glad to get it. While on the tread. mill the operatives fell under the observation of the prison doctor who watched them closely, and in the case of near collapse varied somewhat the forty minute treadmill period. In short, this man was worked to the limit and fed pretty close to the point of starvation. After he got through, he took very good care, so far as the future was concerned, not to enter again a British prison or risk another period of penal servitude. In this connection it occurs to me that if some of our young bucks that are to-day occupants of St. Vincent de Paul, Portsmouth or Dorchester, had six months' similar experience, this might induce them to give some thought as to the advantages of leading a regular rather than an irregular life, and our prisons would be less popular than they apparently are at present with a considerable section of our criminal class. What is a particularly serious consideration is the startling increase of crime among the young men of this country, practically all of whom are armed, as the prison commitments of recent years so clearly show.
In this connection it might be interesting to compare the crime statistics of Great Britain with those of our southern neighbours or even our own Canadian criminal record during the past decade. It might also be interesting to note that during the past ten years practically one-half of the prisons of Great Britain have been closed, due to lack oi*occupation. Contrast this with the great increase in the record of prison occupation in 'Canada over the same period.
The prime object of our penal system is the protection of society. To this end, the main thing is to have punishment of crime, first, sure; second, swift, and, third, most unpleasant for the criminal. In dealing with the matter of prison discipline, we should be neither vindictive nor sentimental. In Canada to-day too much sentiment is wasted on selfdetermined criminals. Men convicted of crime should not be regarded as other than what they are-enemies of society.
Penitentiaries are penal institutions and those incarcerated therein are there as a punishment for crime committed in defiance of law, order and the general welfare of society. All such enemies of society, while undergoing prison sentences, should be

The Budget-Mr. Cantley
deprived of all luxuries and given only a minimum of wholesome food with reasonable periods for rest after toil. Allowances of tobacco or any luxuries I would not permit, and be it known that during the year ended March, 1932, there was spent in Canadian prisons for pipes, tobacco, and so forth, nearly $18,000; for dental services for the same inmates, nearly $10,000, and for medical and hospital treatment over $37,000. These sums, particularly that spent on tobacco and cigarettes, will, I take it, this year be much larger and, in all, for luxuries and hospitalization, will probably exceed $75,000. For library and literature last year the cost was $6,000. Notwithstanding these expenditures, some of our decayed clerical morons and antique virgins of Toronto and some other places are not yet satisfied and have expressed the view that greater luxuries should be available for these gentry. As regards physical punishment, this, under certain conditions is not only justifiable, but necessary, and is the only effective punishment for some types of offenders. For rape and robbery with violence I would prescribe the old sea-going eat^o'-nine tails, a good stiff application of say, thirty lashes, immediately after entering prison to be followed by a similar quarterly application, lest they forget.
During January last, I received a letter from one, Reverend Phillip Jones, Ml, D.D., of Toronto, enclosing some printed matter, one an appeal from the Social Service Council of 'Canada, Toronto, and another from the Canadian Prisoners' Welfare Association of Montreal, each covering several typed pages of advice tendered to the Minister of Justice. The opinions 'therein expressed and the advice so freely offered are an indication of the type of officious, meddlesome idlers who suggest. that our prison population should be given suitable recreation, with payment while in prison, and whose well-being should be the subject of careful consideration by a special board to be composed of a judge, a lawyer, a physician, a clergyman, an industrialist, a social worker, a college professor and an editor, the duties of the latter, I presume, to be to broadcast the views and wishes O'f the prisoners. According to these gentry, corporal punishment is discredited, instead of which, prisoners should have the finer influences of literature and music, and the physical side of the inmates Should be catered to by healthy exercise such as football, baseball and similar forms of reoreatiom. Furthermore, in the achievement of such progressive and up to date treatment 'the prison authorities should have the aid of unofficial workers, and the prisoners' recreation should be in
accordance with the national ideas of sport. Those, Mr. Speaker, are the ideas held by these gentlemen in Toronto, including the Rev. Phillip Jones, M.A. D.D., and so on. With practically all of such suggestions I am in distinct disagreement, and have some doubts as to the mental condition and capacity of those making them.
Referring to the new penal regulations as published in the Montreal Star of December 30 last, miay I say that in my judgment the greater consideration there shown for prisoners is am entirely mistaken departure in prison policy. Men convicted of serious crimes should not be regarded otherwise than what they are, namely, enemies of society. Our penitentiaries are penal institutions, and those incarcerated therein are there as punishment for crimes and misdemeanours committed in defiance of Canadian law, order and good behaviour. In view of this, in my judgment these men should be deprived of all luxuries and comforts and given only sufficient wholesome food and reasonable periods of rest.
Referring to the Ticket of L/aave Act and the matter of the release of prisoners who have served but a portion of the sentences originally imposed upon them-of which, so far as I am aware the last outstanding examples are those of that precious pair of scoundrels, Mowat and MacGillivray-may I say that the idea that buccaneers of that type should escape with little better than one-half of what, in popular judgment, was certainly not an excessive prison sentence, is provocative of indignation particularly on the part of those who were cognizant of and suffered from the operations of these brokers. The minister is not in his seat, but I Should like to say that I do not wish my fellow members to suppose that I hold him personally responsible for the release of those gentlemen. Unfortunately, the law was, and still is, such that he had no choice in the matter.
A reasonable diminution in the time to be served by prisoners, based on good conduct, is not objectionable. I submit however that such diminution should not exceed thirty days per year of service. In other words a man given a ten-year sentence, if his conduct were uniformly good throughout the period of incarceration, might be entitled to 300 days good conduct rebate, and given his liberty after having served say, nine out of a ten year sentence. Such treatment would in my judgment be reasonable, and I submit the present law in connection therewith should be amended.
That practically exhausts what I have to say concerning the treatment of prisoners,
The Budget-Mr. Cantley

tickets of leave and discipline. I know of no possibility of reforming criminals except by punishment. The eternal law is that punishment of some kind must follow a crime, that the way of the transgressor is hard is true and as it should be, and the sooner these gentry understand it and the sooner it is drilled into them by practically the only way in which they can be reached, namely by physical discomfort, the quicker we will be rid of that herd of young men who to-day are occupying our prisons in practically double the number of a few years ago.
Another interesting point in connection with prisoners is that of their ages. We are told that the world is upset, due to the world war. But if we look over the prison records of most of the young men in our penitentiaries to-day we will find they range between the ages of eighteen and twenty-six. They constitute also by far the most dangerous part of our prison population. What do those young men know about the war? When the war began most of them were just out of the cradle, and were only ten or twelve years of age when it ended. Therefore the war cannot be blamed for the increase in our prison population; we will have to look somewhere else for the reason. I believe we should look first in the homes, and consider the home training. There is no such training in the homes of to-day as obtained fifty or sixty years ago. Practically every hon. member in the house familiar with these matters must agree with that statement. The period when I have to look after my family has passed. But there are men within my hearing to-day who might well consider giving more attention to the younger members of their family than a good many people in Canada are giving to-day.
Mr. Speaker, I thank you for the courtesy shown me.


Mr. T. F. DONNELLY (Willow Bunch):: Mr. Speaker, I am sure the hon. member for Pictou (Mr. Cantley) will hardly expect me to follow him in his criticism of the treatment of prisoners, and his observations concerning prison reform. I am not competent to discuss those matters, in fact I am not much interested in them, because I have no friends in penal institutions.
Some time ago the house had a budget presented to it by the Minister of Finance (Mr. Rhodes). May I say that the presentation was made in a most capable and efficient manner; the minister made the best of a bad job. He had a difficult task on his hands which he performed in an efficient and

capable manner, and I wish to join with other hon. members who have complimented him upon his presentation.
I should not be disposed to take up the time of the house discussing the budget were it not for certain remarks and criticisms by hon. members opposite, particularly the Minister of Trade and Commerce (Mr. Stevens) who made comments concerning speeches made by hon. members on this side of the house. The hon. member for S'helburne-Yar-mouth (Mr. Ralston), acting as the official financial critic, made a very capable and efficient speech. He made a careful analysis, and his criticism still stands four square. Replies by hon. members opposite have had no effect whatever upon the remarks by the official opposition critic. His statements stand unanswered. In fact, so far as I am concerned, he covered the ground so completely it will not -be necessary for me in any way to spend further time in detailed criticism. The budget has been criticized and analysed thoroughly by the public; they look upon it as just another Tory blunder, as the work of a blundering government that has done nothing but go from one mess into another. They feel that in presenting the budget the government has just stepped into another mess, they see no good whatever in it. The point which stands out most prominently in their minds, and strikes them in the face when they look at it, is the two cent tax on sugar. With sugar at four cents a pound there is an excise tax of two cents. That is the one part of the budget which people generally throughout the length and breadth of Canada are condemning. It enters into the costs of living of our people. When I went to school there was a saying that such and such an act was as ridiculous as taking candy from a baby. This government does not take candy from the babies, but by the two-cent tax it taxes the candy out of the babies' mouths.


Mr. GOTT:: Terrible.


Thomas F. Donnelly: Yes, it is terrible, I believe it. But perhaps the hon. member is one of those not affected. There is only one class of people not affected, that is those who due to their physical condition cannot eat sugar. The government has always looked after the big financial interests, these big corporations, so now they are looking after the individual with a big corporation who does not dare to eat sugar. That is so my hon. friend can say "hear, hear." Throughout the length and breadth of this country that is the only individual who is exempt from this tax. In

The Budget-Mr. Donnelly
the past we have had budgets known as Robb budgets, we had the budget known as the Dunning budget, and we had one known as the Bennett budget, but this budget is known to-day from one end of Canada to the other as the diabetic budget.
I will now refer to some remarks made by the hon. Minister of Trade and Commerce. He started his discourse on this budget by painting a particularly rosy picture, and then he said something to the effect that it may even be grim, but we are looking to the future with a great deal of confidence. He deplored the condition that the country is in at the present time, spoke of the terrible depression affecting all the world, and then turned around and tried to picture to us the wonderful amount of trade we are doing, extending our trade with different nations of the world. After I had listened to him for five or ten minutes I was almost persuaded that there was no depression in Canada at all. The minister told us about the volume of our trade. Instead of dealing with values as one would naturally expect he began dealing with volume. Of course a man in business to-day can increase the volume of business done, all he has to do is lower his prices. If a business man is financially embarrassed what he does is to put on a sale and sacrifice his goods at a lower price. And that is what the primary producer in Canada is doing to-day, he has got a fire sale on, or you might say a bankruptcy sale, he is selling his goods at a loss. Naturally we sell a larger volume, but we are not getting anything for it.
But let us look more closely into the figures quoted by the Minister of Trade and Commerce. I have before me his speech made on the 28th of March. This is what he said:
I have here a calculation made for me by the Bureau of Statistics, which indicates that the fall in the volume of our trade as compared with 1930. is only five per cent. I refer to the total exports to all parts of the world.
Notice what he said, he said this calculation was made for him. Well, it must have been made especially for him, because I got a report from the Bureau of Statistics for the year 1932, under the same Minister of Trade and Commerce. I turn to page 3, and this is what I find:
. . . while exports on a volume basis decreased in 1931, 15-9 per cent, and in 1932, 21-4 per cent. . . .
The minister says they decreased only five per cent, but his department says they decreased on a volume basis 21-4 per cent. Now someone is wrong. Who is wrong 1


Mr. YOUNG:: The minister.


Thomas F. Donnelly: Well I would not like to say who it is, but he says this was made specially for him, so probably that is the reason. Probably he is dealing with it in the same way as he dealt with a question I asked him here a year ago in connection with the gambling in wheat, to which I intend to refer later on. There is an old saying that figures do not lie, but-some people should not figure. This seems to be one of the cases.
Then he goes on to say:
We take the volume of business in 1932, and measure it by the price level of 1930, or apply to the volume of business in 1932, the price of 1930. Revaluing the 1932 exports at the 1930 price we have this result-
In 1930 the volume of business done was
8895.000.	000. I do not know where he gets that, I cannot find it. I looked all over for it and could not find it. But looking up the report of the Department of Trade and Commerce I find different figures entirely. This is what I find, on page 10, under Canada's Trade 1932. I find our exports, to which he was referring at that time, were, in 1930, SI,144,938,070. Taking 1932 and taking this reduction said by his own department to have taken place, that is 21'4 per cent, I find that the volume of trade in 1932, if put on the 1930 price level,' would be only $899,921,323. We would therefore have a drop of over
8200.000.	000, not what the minister says at all. I do not know where he got those figures, they seem to be absolutely wrong. I will show more than that; I will show that practically every figure that he has used here is wrong.
I cannot find one that is right. And further may I say that volume of trade is a comparison of no value whatever; the amount of money is what we are interested in.
Then he goes on to deal with tariffs, and his dealing with tariffs is the most ridiculous thing of all. The hon. member for Souris (Mr. Willis) tried the same thing. There was an hon. member for Mackenzie who at one time tried this, a Progressive Tory or Tory Progressive, and then he got a job on the tariff board. Probably they thought they . might get one too. But that job has been filled, there is no more chance, and I advise them to desist because they are not going to get anything of the kind. Anyway the public is wise to it.
The minister began to analyze the trade and tariffs of the country. Probably I had better read what he said, and you will know more particularly what I am criticizing. Referring to what had been said by the hon. member for Shelburne-Yarmouth, "Up went the duties
The Budget-Mr. Donnelly

and down went revenue," the Minister of Trade and Commerce said:
Let us take the average duty on goods imported from the United Kingdom, other than alcoholic liquors, for the term in which my hon. friends opposite were in office. You have an average rate of 17-9 per cent. In 1932, under the present government's increased tariffs condemned so much by my hon. friends, we have a rate of only 18-62, about I of 1 per cent increase on the average on dutiable goods imported from the United Kingdom.
Before the last election our friends went up and down the country telling us how they were going to make tariffs fight for us, how tariffs were going to 'bring back prosperity, how the tariff was going to work for the farmer. But if we have only got j of 1 peT cent increase I can understand why the farmers are not very well off; f of 1 per cent increase is not going to do much good. 1 wonder if that is the reason. As a matter of fact, Mr. Speaker, there is nothing in that a-t all; it is absolutely absurd and ridiculous. There is no sense in comparing averages in connection with tariffs; it cannot foe done. It is like the story -they tell of the man who was making sausages. They asked him what he was using to make them, and he said he was making -them from horses and rabbits. They asked how he mixed them and he said, "I am mixing them fifty-fifty." They questioned that and he said, "Yes, fifty-fifty; one horse and one rabbit." That is about all it amounts to when you compare these averages in connection with tariffs. It is no good at all. Let me give an example. When the Liberals were in power we were paying 40 cents a pound for butter. If there had been a tariff o-f 8 cents per pound ait that time it would have meant a tariff of 20 -per cent. Not very long ago the price of butter was 20 cents a pound, and we have a tariff of 8 cents; that meant -a tariff of 40 per cent on butter. So when you talk of percentages in this way it means nothing at all; it is of no use whatever. Then again, Mr. Speaker, we know that it is quite possible to have a long list of goods on the free list and another long list of goods with an extremely high tariff; the result will be -that none of the goods under that high tariff will come into the country, so -everything entering will be free simply because the tariff is so high that it keeps everything out. That is what this government is doing; it is -making the tariff so high that it is keeping everything out of the country; it is cutting off our trade by prohibitive tariffs, and that is why averages such as these do not -mean anything at all. 
Even if the averages were of any value the figures given by the Minister o-f Trade and Commerce are absolutely ridiculous. They d-o not mean anything; th-ey -are not correct, as I shall endeavour to show. The minister said:
Let us take the average duty on goods imported from the United Kingdom, other than alcoholic liquors, for the term in which my hon. friends opposite were in office. You have an average rate of 17-9 per cent.
That is wrong.
In 1932, under the present government's increased tariffs condemned so much 'by my hon. friends, we have a rate of only 18-62, about I of one per cent increase on the average on dutiable goods imported from the United Kingdom.
I say that is wrong, and my authority for that statement is the sa-me report from the minister's own department, which I have before me. Turning to page 12 I find the following:
Canada's dutiable imports from the United Kingdom, less imports of alcoholic beverages and tobacco, but plus imports free of duty under the preferential tariff,-
Then the figures given by the minister are quoted. One or the other is wrong; either the man in the bureau of statistics who compiled this report is wrong or the Minister of Trade and Commerce is wrong. I leave it to the house; hon. gentlemen know well enough that the figures given by the minister were wrong according to the figures set out in this statement issued by his own department. But this is in line with what the minister has done all the way through, in one thing after another.
Let us go a step further. Not only are the minister's figures wrong; I say that if he had taken the right figures on these dutiable goods coming in from the United Kingdom under Liberal rule from 1922 to 1930, the period to which he referred, he would have found that the average was about 18.35 per cent. In 1932, the first full year of Conservative rule, we find that the dutiable imports from the United Kingdom totalled approximately
879,693,000,	and that the duty paid amounted to about $23,305,000. The liquor imports totalled $21,694,000 and the duty paid amounted to $10,111,000. Thus the average duty on all the imports from the United Kingdom, with the exception of alcoholic beverages, was 22.75 per cent instead of 18.62 per cent, which was the figure given by the minister.
But that is not all, Mr. Speaker; there is something else to be taken into consideration.

The Budget-Mr. Donnelly
This government put an excise tax on all goods coming into this country, which is the same as a duty. All goods had to pay that excise tax of one per cent.


An hon. MEMBER:: Three per cent.


Thomas F. Donnelly: No, it was made 3 per cent in 1932. I want to be fair to the government, and these are the returns for the year ending March 31, 1932, while the 3 per cent tax was not put in force until the end of March, 1932. It must be remembered also that this excise tax is collected on the duty paid value, so that gives us a total of 23.98 per cent. But even that is not all. This duty is calculated on the basis of the pound at $4, but the duty was collected on the basis of the pound at S4.86J. So now we have the duty totalling 29.16 per cent. That looks more like it. These people had some grounds for saying they were going to make the tariff work, but I leave it to the public to say what kind of work it has been doing. This government raised the tariff all right; we will admit that. They raised it from 18.35 per cent under Liberal rule to 29.16 per cent for the first full year of Conservative rule, and it will be higher than that this year, because now we have the 3 per cent excise tax. When we figure it out we will find that the average will be about 32 per cent instead of 29.16. They have raised the tariff, all right; they have shut off our trade with the outside world, and now they are trying to prove that they have not raised the tariff at all. I am willing to give them all the credit they deserve for raising the tariff, but I think if there is one thing in the world to-day more than another that has caused our present depression it has been this extreme nationalism, this prohibitive tariff, this idea that we must have higher and higher tariffs and that each country should live to itself and not trade with its neighbours.
I submit, Mr. Speaker, that the only true index of tariffs is the duty collected. Under the Liberal rule we collected 6 per cent on farm implements; at the present time they are collecting 25 per cent. That is all we need say. The present tariff on cream separators is 25 per cent; under Liberal rule they were free. What is the tariff on barbed wire now? It is 10 per cent, but under Liberal rule it was free. That is all we need to know, and that is the only true test. The other night I listened to my hon. friend from Rosetown (Mr. Loucks) tell us that he had been in Montana and North Dakota and could not find any difference in the prices of farm implements there as compared with the prices
in Canada. I have under my hand a list of prices of farm implements in the United States and a list of prices of implements in Canada, and I shall be glad to show them to any hon. member who wishes to see them.
I shall give only one or two figures so that the house may have an idea of the comparison. Here is a new Deere gang plough, which is the usual plough used in western Canada, fourteen inch, extra heavy. In Canada it is worth S152 cash and in the United States $118.75, or a difference of 833.25. That is not very much to the hon. member for Rosetown but it is a whole lot to me. I find also a Van Brunt single disc drill, twenty-two runs, two poles, made for four horses. Anyone who has ever farmed in the west knows what it is like. This drill sells in the United States for $182.40, while across the line in my constituency the price is $233, or a difference of $50.60. You can compare all the others and you will see a difference right through, but I give these as examples. The price in western Canada is practically the United States price with the addition of the tariff, twenty-five per cent, notwithstanding that we live just across the line. We can see their implements and we know what prices they pay, so that it is ridiculous for anyone to say that the prices of farm implements on the Canadian side are the same as the prices in the United States. Possibly $25 on the hundred may mean nothing to some hon. members, but when I put my hand in my pocket it means a good deal to me. I have had a ten per cent cut along with other members and I know what the difference is.
I come now to a matter discussed by the Minister of Trade and Commerce, namely, the stabilizing of the price of wheat-at least, what he calls the stabilizing of the price. I should not like to describe it in that way, because I remember that when hon. gentlemen opposite came into office the price was from 95 cents to $1, and the only stabilizing they have done has been to keep the price dropping steadily. They kept it going down and down, until it reached 40 cents-


An hon. MEMBER:: 38 cents.


Thomas F. Donnelly: Yes, it was as low as
38 cents, and that is the only stabilizing I have ever seen them do. As I say, they have kept it going steadily down. The minister went, some length to tell us of the activities of the government in connection with this matter. May I say that I have been interested for some years in the handling of wheat. For some time we had two bodies handling wheat. In western Canada we gave
The Budget-Mr. Donnelly

the grain pool our wheat and they were told to sell it and pay us our money back at the end o{ the year, whatever average they may have received. They did no hedging; at any rate they were not supposed to do any hedging but were supposed to sell so much wheat from week to week and month to month, so that we should have an orderly market. If we had 12,000,000 bushels they would sell
1,000,000 bushels a month, thus securing an orderly marketing of the product. But they were not supposed to be gambling in wheat; they were not supposed to use the exchange for any such purpose. They may have done so, but that was never the intention. That was one method of handling grain. We had also the organized grain trade, and whenever they would buy wheat in the country they would wire the head office in Winnipeg, informing them that they had bought so much wheat to be delivered in June or July as the case might be; and they would go on the market the next day and sell that wheat; to be delivered in June or July or whatever month it might be.
The pool, which was handling our wheat in western Canada, met with more or less success, and the price of wheat was going up. But they made the mistake of not selling the wheat in an orderly way as guaranteed. They were holding a certain quantity over and the result was that in 1929, when the price began to break, they were caught with a good deal of wheat on hand. They had made advances to the farmers on the wheat, and when the break came the price gradually fell until it dropped below the amount of the initial payment given to the farmers, and the advances which they had received from the banks were consequently in danger. In this situation it seemed that they were going to break and they asked the government for assistance, which was given them. In 1930 Mr. John I. McFarland was put in to sell the carryover of this wheat; he was instructed to sell the wheat which the pools had left over from the 1929-30 crop. That was what he was supposed to do-to sell the wheat which the pools had left over from that crop. After he had been there for a while what did the Minister of Trade and Commerce, as the hon. gentleman informed us, tell Mr. McFarland to do? I would refer the house to Hansard at page 3468, where the minister is reported as follows;
Recognizing this fact and appreciating the serious loss which would be entailed, particularly to the producer, the government authorized Mr. John I. McFarland, the head of the pools sales agency, to purchase grain for future delivery. . . .

Not to sell grain at all, but to purchase grain for future deliveries. Remember what I said he was put there to do. He was put there to sell the carryover of the 1929-30 crop, but here we have the government telling him to purchase grain away back in 1930. When we were sitting in the committee with James Robertson, and Smith and the others, dealing with this very matter, John I McFarland had been authorized at that time, I am told, to buy wheat. Thus it came about that last spring I asked the Minister of Trade and Commerce a question with regard to this very point, whether John I McFarland was buying futures and whether he did have any wheat. Listen to what the minister said on April 15, 1932. At page 2084 of Hansard of that year the hon. member for Weyburn (Mr. Young) had said;
May I say that in the Financial Post of last week the statement appeared that when Mr. McFarland undertook to sell the 1930-31 crop he at the same time bought futures against it, and that as a result of his activities the government to-day is holding millions of bushels of future wheat which it cannot get rid of, except at a loss, until the price goes up.
What answer did the Minister of Trade and Commerce make to the hon. member for Weyburn? He said:
I do not know of a bushel of wheat held by the government, either directly or indirectly.
What are we to say to that? Here he turns round now and tells us that instructions had been given to buy wheat. What do you make of it? What do you think of a man standing on the floor of the house a year after telling us that he did not know of a bushel of wheat that was held by the government, either directly or indirectly, and making the statement which the Minister of Trade and Commerce made to this house the other day? When telling us the other day that John I McFarland had been told to buy wheat, he said, addressing the hon. member for Charlevoix-Saguenay (Mr. Casgrain):
Let me again assure my hon. friend (Mr. Casgrain) I had this written out merely for the purpose of accuracy owing to the importance of the subject and my desire to get before the house as clear a statement as I could give it on this very important matter.
So that this is no haphazard statement, but one deliberately thought out.


Mr. CASGRAIN:: Prepared by the government.


Thomas F. Donnelly: Yes, prepared for delivery by the minister in the house. He had told Mr. McFarland to buy wheat, and in this very statement he said that this was not.

The Budget-Mr. Gagnon
a gamble but the most conservative form of *doing business. Well, if any man appeared in a court of law and said that the buying of wheat futures was not a gamble, he would be laughed out of court. I suggest to the Minister of Trade and Commerce that he go into western Canada and tell them that the government was buying wheat futures and that it was not gambling. Let him do that and see what they will say to him. If that is not gambling, no one in western Canada has ever gambled in wheat. That is the way they all gamble and it is the only way they can gamble, outside of buying puts and calls. Very little of that is done, the gambling in wheat is done principally by the buying and selling of futures. Mr. McFarland buys wheat to be delivered in July. When July comes he has either to take delivery or postpone *delivery to some other month. He must pay the interest and the carrying charges. But this is only conservative business, it is not gambling at all. I would remind the minister of what his leader has said, I refer him to page 779 of Hansard of 1931, where his leader is quoted as follows:
What is the cause of the great depression in western Canada? Hon. gentlemen opposite know that the most important cause is speculation.
The Prime Minister was very hostile at that time and he was telling the farmers how they had lost their substance in gambling and riotous living. Later on in the same session the Prime Minister referred to Mr. Priestly, the vice-president of the United Farmers of Ontario, who had appeared before the Stamp commission in the city of Calgary. He quoted a newspaper report, as follows:
While on occasions farmers have been borne to the crest of prosperity on the wave of the system, they found on looking back that they had spent more time in the "trough of poverty" than in the joy of prosperity. Dirt farmers now believed that "paper wheat" had too much influence on the price of real wheat.
Dealing with the money side of the question, Mr. Priestly quoted the results of his survey which showed the losses in excess of one hundred million dollars.
Individual losses, he declared, were all the way from a few hundred dollars to $168,000. "In some instances it was shown that farmers lost everything-land, crop and equipment," said Mr. Priestly.
That is what the government has been doing. The other night the hon. member for Peace River (Mr. Kennedy) stated that the farmers were pleased with the wheat stabilization plan, but I want to say to him and to the government that I have not met a single farmer in western Canada who believes that the stabilization plan has had one particle of effect upon the wheat market. Does the hon. member know that hundreds of speculators bought wheat in Chioago and came over to Winnipeg and sold it to the government? The government was buying not only Canadian hedges but American hedges as well. We have seen the results of cither attempts .at stabilization. Look at what happened in Brazil when an attempt was made to stabilize the price of coffee. Look at the United States where the farm board poured hundreds of millions of dollars into the market in an effort to stabilize the price of wheat. Their efforts had absolutely no effect, and yet this great Samson of ours was going to go out to put his shoulder under the wheat market to hold up the price. It was absolutely ridiculous. It is the world's supply and demand that governs the price of wheat. We hope that later on in the session the minister will tell us how much wheat was purchased and how much money the government expects to make. There is a chance that they will be able to get out. All of us have been in t'he wheat market at some time or other; some of us got out with a loss and some with a gain, while others will be lucky to get out with their hides.


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


Thomas F. Donnelly: We must all take off
our hats to the wheat trade. They started in and they skinned the wheat pool until they were broke; they skinned the western provinces until they were broke; they skinned the western fanners until they were broke, and now they are skinning the Dominion government.
Mr. ONESIME GAGNON (Dorchester); Mr. Speaker, I hope the hon. member who has just taken his seat (Mr. Donnelly) will pardon me if I do not attempt to follow his line of argument. I was obliged to leave the chamber and did not return until he had been speaking for almost twenty minutes. Therefore, I shall not attempt to reply point by point.
I desire to express my humble views upon the budget, which views I hope will be shared by my constituents in Dorchester. The discussion upon the budget affords a member an excellent opportunity to discuss not only the problems which confront the country as a whole but the special conditions arising in his own province and constituency. It provides also an excellent occasion to review and compare the policies of the different political parties and ascertain whether they are for
The Budget-Mr. Gagnon

the welfare of the country. Canada is struggling along under enormous difficulties and the Canadian people expect a continuance of that masterful leadership which so far has saved the country and which I hope will, with the aid of divine Providence, continue fearlessly for the common good. It has been said that adversity puts statesmen on trial. The Minister of Finance (Mr Rhodes) has undertaken a courageous and excellent task in finding the ways and means to balance the budget. I have no hesitation in offering here, as I will before my constituents, my most sincere congratulations. The Canadian people as a whole are appreciative of the enormous strain to which he and his colleagues have been subjected in their efforts to preserve the integrity of this country. Canadians of all classes recognize that the ship of state would soon be on the rocks if we were to apply the vacillating and conflicting theories of hon. friends opposite or the strange and somewhat revolutionary principles underlying the Cooperative Commonwealth Federation movement.
I need not repeat what has been better said by those who have preceded me, that the government is doing everything humanly possible to maintain the integrity of this country, to safeguard its institutions, to provide the unemployed with food, clothing, fuel and shelter and to keep the nation in peace, order and security. The Canadian people understand that the actions of the government are, as are all human acts, open to criticism but that in the main they have been guided, inspired and directed by the highest motives. In these days of suffering and depression the people look for real statesmanship and not for narrowness of vision or bitterness which will destroy the harmony now existing among the different provinces and races in Canada. In my opinion the financial critic of the Liberal party, the hon. member for Shelburne-Yarmouth (Mr. Ralston), a distinguished barrister and parliamentarian, has been more desirous of securing political advantage than offering his sincere cooperation. May I also express my amazement at the action of some hon. members opposite, for instance, the hon. member for Quebec East (Mr. Lapointe) who has not yet spoken on the budget, but who, on March 28 in Quebec City, safely surrounded by his political friends, indulged in his usual sectional attacks upon this government, which, according to him, does everything for western and nothing for eastern Canada. Such attacks are, as I shall later demonstrate, wholly unfounded.

What is the main doctrine propounded by those two distinguished gentlemen to bring back Canada to the road of prosperity? What is 'the measure of their cooperation? W'hat constructive suggestions do they offer? Nothing but vague and nebulous theories which do not receive the approval of all Liberals in this country. May I give an example? Is it not surprising to .recall that those two hon. gentlemen insinuated in their budget speeches that the government was using money derived from taxation to promote radio broadcasting throughout Canada? Such views are not only erroneous but made deliberately with the ideia of misleading the people and creating discontent among the poor. Everybody in this country knows that money spent on radio broadcasting is not collected from the taxpayers generally but is paid by radio set owners who are scattered all over Canada. The government has wisely decided that those who can afford radio sets are able to pay for the service they get from the state which has to provide for them the free enjoyment of our air channels and ait the same time to enact regulations whereby the marvellous invention of radio will be used for the diffusion of arts, sciences and culture and at the same time be an instrument of harmony between the different races of Canada. Is i.t necessary to emphasize again that to maintain abate control over radio, control which was adopted unanimously by the house last year, not a single cent is collected fiom the taxpayers at large? Radio set owners are called upon to pay for that service, and while in our country radio set owners pay only S2, yet the report of the Commission on Radio Broadcasting which was created by our hon. friends opposite, shows that in Great Britain, for instance, radio set owners pay .ten shillings a year for a licence whilst in Germany and Japan they pay $6 a year, in Australia, twenty-four shillings a year, and in some other countries even more. In Canada the licence fee is only $2 a year and it is only this money which is put down this year in the estimates in order to provide radio broadcasting in Canada. I maintain further that last year when the government decided to increase the licence fee from 81 to $2, it entered with the radio set owners into a contract whereby it bound itself not to expend this money for other purposes than for the betterment of programs and the expansion of radio broadcasting in this country. Therefore my hon. friends opposite are certainly making a narrow criticism when they try to induce the people to believe that this

The Budget-Mr. Gagnon
government is now providing for radio set owners something at the expense of the poor and, indeed, of all the taxpayers. It is easy to surmise what themes will be developed by hon. gentlemen opposite in the approaching election. I hear them assailing the government violently, saying, "People starve and yet the government spends their money on music." Knowing these Liberal tactics, I condemn such insinuations as being cowardly and oonitemptible.
Before commenting further on the attitude of our hon. friends opposite, let me come back to the situation of our country since April 1, 1932. A year has passed, one which has brought no happiness to this country nor to the world, one which has not given us more wealth or prosperity, but which has certainly strengthened our confidence in our institutions, which has also strengthened to a great extent the bonds of friendship between the different elements of the Canadian nation and which has instilled in our hearts the true sentiment of courage and hopefulness. In 1931 everybody remembers that the Bank of England went off the gold standard. In 1931 and 1932 in the United States thousands of state banks closed their doors and I cannot do better than use the words uttered by the hon. member for Shelburne-Yarmouth when, a few days ago he described the appalling situation of banks in the United States in these words:
A few weeks ago, despite the inconvenience and humiliation in connection therewith, the people of the United States turned the key in the door of every bank from Massachusetts to California and from the forty-ninth parallel to the gulf of Mexico; because they believed it was necessary so to do, they did it.
Why in this country was the government not obliged to resort to such desperate means? It was because the government was vigilant enough to foresee what might happen and to take the necessary precautions to prevent such a disaster, by passing the necessary orders in council preventing the hoarding and export of gold which have had such calamitous effects in other countries.
When speaking about the banks we do not, may I humbly suggest, reflect enough on the fact that banks are the only instruments whereby the savings of the nation may be safeguarded, and those who sometimes wildly attack our banks, are not mindful of the interests of depositors. I admit, however, that the laws with respect to banks and banking ought to suit the needs of the moment and this is why the legislators of all political parties have deemed it wise that the Bank
Act should be revised every ten years. It now seems opportune that I congratulate the government very warmly on the creation of a commission to investigate banks and banking in Canada. I hope this commission will begin its work very soon and if I might offer a humble suggestion, may I recommend that the scope of the proposed inquiry be extended as much as possible in order that the commission may study the vexed question of public and private debts which has been discussed in the house and in the banking committee by the hon. member for Red Deer (iMr. Speakman)? May I ask the government that this commission study attentively the problem of rural credits for our farmers? May I repeat what I have already said and what I believe to be true, namely, that the Canadian farm loan board legislation is certainly not very practical for the farmers of eastern Canada; its workings are too expensive and its interest charges are too high. The fact that the board does not operate in the winter time causes great prejudice to the farmers of eastern Canada. I understand that on account of snow covering the ground in the winter, the inspectors cannot inspect the land of the farmers who apply for loans. This objection has some force. On the other hand it seems it could be overcome if the Bureau of Statistics had carefully noted in their files all details with respect to land under cultivation in Canada. Time does not permit me to dwell at greater length on the subject. Nevertheless I hope the commission will recommend that the legal rate of interest be lowered. Not being an expert on the matter I shall not attempt to say to what extent it should be decreased, and I shall not be presumptuous enough to dictate what the commission should do. However with my humble knowledge I simply ask that the commission advise the government as soon as possible to take the necessary steps to lower the rate of interest on bank deposits and on all sorts of loans.
Need I state that the most important announcement in this year's budget is for the benefit of the farmers throughout Canada, and especially those in eastern Canada. I refer to the creation of a stabilization fund to apply to farm produce. Last year the hon. member for Dufferin-Simcoe (Mr. Rowe) and myself asked the government which, to a great extent had helped the western farmers, not to be unmindful of the pitiful condition of agriculture in eastern Canada. We both recommended that a bonus be given to farmers to promote the export of their farm produce.
The Budget-Mr. Gagnon

This year we have been quite surprised to hear from hon. members opposite that the bonusing of farm exports was unsound in principle. Last year, however, some Liberal members opposite were in agreement with me in that connection, and during the by-election at Maisonneuve and South Huron held during the past summer hon. members opposite blamed the government for not bonusing the farm produce of eastern Canada. During those election campaigns they assailed the government by repeating their accusation: Nothing for the east and everything for the west. Now, when the government which has helped the western farmers takes a most appropriate and effective step towards helping the farmers in eastern Canada hon. members opposite say, "This help you purpose giving the farmers by way of the creation of a stabilization fund is unsound in principle." Everybody deplores the fact that owing to the depreciation of the pound sterling the price of farm produce exports has decreased to such an extent that some farmers in eastern Canada as well as those in western Canada have lost faith in the future. But the creation of the proposed stabilization fund, not only for the benefit of farmers but for the benefit of the fishermen of the maritimes and Quebec, will certainly prove that the government has given to these different problems its most careful attention.
As I said a moment ago the creation of the fund is the most appropriate and effective way of helping the Canadian farmers to increase their domestic production and to increase the volume of their exports. I have in my hand the Bulletin des Agriculteurs which, by the way, is the best informed agricultural newspaper on agriculture published in eastern Canada. I have before me the issue of March 30, 1933, on the first page of which appears an article signed by Mr. Donat C. Noiseux, one of the best informed economists in the province of Quebec. He writes as follows:
(Translation):
The new measure, announced by Mr. Rhodes, must bring joy to all farmers: it is the organization of the agricultural stabilization funds. Few newspapers pointed out the importance of this measure to farmers who devote themselves to mixed farming, this, therefore, applies to us, from the province of Quebec.
I shall not attempt to read the whole article, and shall conclude by reading the last words:
This act of the Dominion government which establishes an agricultural stabilization fund to the benefit of the eastern farmers certainly deserves our congratulations, and we believe that we are doing an act of justice by proclaiming it.

Any hon. members who are interested in this newspaper, published in the interests of the farmers of the province of Quebec would do well to direct their attention to this article which discusses in detail the proposed stabilization fund for farmers. Almost all farm products exported will benefit from the operations of the fund. Those affected would be animals, including meats such as bacon and ham; then there are poultry, fish, both fresh and canned, tobacco, cheese, milk products, canned fruits, canned vegetables, maple products, eggs and honey. Who will say that the farmer of the province of Quebec will not receive enormous benefits from that legislation?
I wonder why the hon. member for Quebec East and his friends so strongly condemn the stabilization, fund, and why he has attacked it so violently. Speaking in Quebec city on March 28, and referring to the national protection policy of the Conservative party, he accused the government of pursuing a stupid policy. We have not forgotten that the hon. member for Quebec East, who likes sometimes to abandon himself to violent flights of oratory, said in 1931 in the city of Ottawa, that the policy of Canada first was pure folly. Who could be surprised at this time to learn that the hon. member has stated, the stabilization fund for farmers is just a stupid policy based on an unsound principle.
In 1930, before the party on this side of the house took power, Canada had become the dumping ground for all foreign countries. Our distinguished leader, realizing the fact that Canada was in a very critical situation, owing to the fact that the United States, Germany, France, and many other European countries had raised their tariffs sky high, decided to go back to the national policy of protection which had saved Canada in days of depression in the past. In his famous speech delivered at Winnipeg the present Prime Minister enunciated in his program the steps he considered necessary for the restoration of prosperity in Canada. Realizing the absolute necessity of Canada protecting itself against foreign competitors, and at the same time the necessity to find new markets for Canadian agricultural products, in his usual energetic fashion he expressed his policy and stated that if necessary Canada would blast its way through the markets of the world.


Some hon. MEMBERS:: Oh, oh.


Mr. GAGNON:: We can hear the laughs
and the derisive comments of hon. members opposite. Certainly they were not used to such definite expressions from their leader.

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We remember, for instance, that the former Prime Minister and the hon. member for Quebec East, stated we ought not to raise our tariffs for fear of offending the United States. They remind me of the mother who would try to prevent the dogs from barking for fear they might awaken her baby.
Do hon. members know how those words of the present Prime Minister were explained during the last election campaign in the province of Quebec? How did they explain the expression that if necessary we would blast our way to the markets of the world? Hon. members opposite explained those words by saying that they meant a new step towards conscription. We are not surprised when they are not able to understand that the language of diplomacy may sometimes be firm and not cease to be diplomatic. History will show that our great leader was right, and anybody reading what has taken place in Canada since 1930 will acknowledge that in oertain ways Canada has blasted its way through the markets of the world.
Let us state briefly what has taken place. In 1931 we made treaties with Australia and New Zealand, so drafted that now, although New Zealand butter dealers are shipping thousands of pounds of butter to Canada, this butter remains in bond until the sale of it will not be injurious to the butter producers of Canada. We secured at the Ottawa conference of 1932 substantial and profitable preferences for our goods in all markets of the empire. We have also concluded satisfactory arrangements with Germany, in a few days we hope to conclude a satisfactory treaty with France, and we already see the dawn of the day when the United States of America will come to us and offer to lower the tariff walls which have proven so disastrous to our Canadian agricultural producers. Why should we not be proud of our achievements, why should we not boast of our accomplishments, why should we not be optimists, when our conscience tells us that we have done everything possible to help agriculture all over Canada?
It is true, Mr. Speaker, that this stabilization fund will assure more than $10,000,000 to Canadian farmers, and consequently this measure of salvation will be an additional burden on the exchequer of the country. Therefore the hon. Minister of Finance has been obliged to increase taxation, because revenues have decreased, because the deficits of the Canadian National Railways have increased to an appalling extent and because, as the hon. member for Shelbume-Yarmouth 53719-248
has frankly admitted, in relieving unemployment the government has spent lavishly. I am pleased that the hon. member for Shel-burne-Yarmouth has made that admission, in view of the fact that this afternoon the hon. member for Vancouver South (Mr. Maclnnis) said we had done nothing practically to relieve unemployment. Now, Mr. Speaker, we have to find the money for that stabilization fund, for the relief of unemployment and to continue to pay pensions to soldiers. Naturally the Minister of Finance must find it somewhere. Therefore he has decided that this year he would impose a tax on sugar. Hon. members opposite profess to be horrified. The hon. member for Quebec East, speaking in Quebec on March 28, characterized such taxation as infamous. Our Liberal friends are fond of such moderate expressions. The hon. member for Vancouver South last fall referred to the Ottawa conference agreements as "iniquitous documents." And a few weeks ago the same hon. member, when discussing the railway legislation, called it an "iniquitous bill." But now the hon. member for Quebec East wants to get first prize for using wild expressions, so he calls this sugar tax "infamous." Let us consider for a moment the various aspects of that taxation. We find that refined sugar before the war sold at ten cents a pound, and during the war it sold at even more than thirty cents a pound. Since our party came into power, whether it is because the refiners were afraid of the energetic action that the government might take in using against them the Combines Investigation Act if they tried to crush the consumer, or on account of some other cause at any rate the fact is that the refiners kept the price of sugar at about five cents per pound. Now even if we add two cents a pound tax, sugar will still be selling at three cents less than it sold before the war all over Canada. Now, Mr. Speaker, why should we wonder that the hon. Minister of Finance believed that a tax of two cents a pound could reasonably be levied on sugar, when it is recognized that such a tax can be collected at the refineries, thereby saving an enormous amount that sometimes has to be spent for the collection of taxes? I have no hesitation in saying that the principle of such a tax is just, because it causes no discrimination against any class of taxpayers. Poor people, Mr. Speaker, are certainly willing to share the burden of taxation, because they are patriotic enough to understand that a government which is spending lavishly, as the opposition says, for the relief of unemployment and for pensions, and which is burdened with a heavy deficit on the rail-

The Budget-Mr. Gagnon

ways, must find the money from some source. They are courageous enough to do their share to help the exchequer of Canada. It has been said that this tax of two cents a pound on sugar will not represent more than ten cents a week to any family, be it rich or poor. I ask you earnestly, who are the people who receive pensions in Canada, who are the people who receive relief money, who are the people receiving old age pensions, who cannot spend ten cents a week extra on sugar to help the exchequer of Canada in such times of need and depression? Mr. Speaker, those who condemn the action of the government in imposing a tax upon sugar, who call it an "infamous" tax, who take pride in imitating Robespierre and Lenin by attempting to set class against class, certainly are misjudging the sense of patriotism of the poorer classes in Canada when they accuse them of being unwilling to help the Canadian exchequer to the extent of ten cents a week. I will go further, I will say that this tax will not constitute a burden on the farmers of this country. Refined sugar is mostly used in the manufacture of candy, cakes and pastries, which are seldom purchased by our farmers in these times of depression. The tax on refined sugar will on the contrary help the farmers of eastern Canada, since this tax does not touch maple sugar and maple syrup, which last year was sold at distressingly low prices. Here we may admire the far-sightedness of the government which on the one hand helps the maple sugar producers by giving maple products the benefit of the proposed stabilization fund and on the other hand taxes refined sugar which is certainly a competitor of maple sugar products.
It is not inopportune to say a few words with respect to the maple sugar industry, which is properly called the oldest industry in Canada, and which adds much to the prosperity of the province of Quebec, and my county of Dorchester. Last year I asked the hon. Minister of Trade and Commerce to help the maple sugar producers by finding ways to increase the sale of their commodity. I am pleased here publicly to thank the minister not only foT having listened to my humble views with sympathy, but also for providing this year for a publicity campaign all over Canada to stimulate the sale of maple products. This publicity campaign will be paid for in part by the maple sugar producers of the province of Quebec, in part by the Quebec government and in part by the federal government. I am pleased to tell this house that with my hon. friend for Quebec West (Mr. Dupre), the Solicitor General, I have been [Mr. Gagnon.)
in close touch with the chief of the maple industry for ithe Department of Agriculture in the Quebec government, Mr. Cyrille Vaillancourt, who, by the way, ds a native son of Dorchester and a devoted and competent official of the Quebec government. We have studied together, since I have been a member of 'this house, to find means to help the ma.ple sugar industry which unfortunately had been forsaken and abandoned in previous years. Mr. Vaillancourt is largely responsible for the revival of the maple sugar industry in Quebec. Eight years ago, he established a cooperative society of maple sugar producers, called the Quebec Maple Sugar Producers, and endeavoured to put the industry on a paying basis. In one of the pamphlets published by the Quebec government I find the following:
Before a prospective member is accepted by the society, he has to sign a contract undertaking to make his product according to the methods recommended by the society, and further, always to gather and boil his maple sap under the most sanitary conditions possible and to ship only an absolutely pure product.
Each member is given a number, and labels bearing the member's number accompany each shipment made to the society. It is thus an easy matter to check up on the producers if any attempt is made to defraud, since, when the syrup reaches the society's warehouse, it is immediately inspected and graded by officials of the Department of Agriculture.
A school is supported by the Quebec provincial government, which is attended by young men who desire to acquire a better knowledge of the best methods of manufacturing maple syrup and sugar, and a refinery has been established at Plessisville which last year received twenty thousand barrels of maple syrup, each containing thirty gallons, from the two thousand members of this cooperative society. I am glad to say that chemists are at the disposal of the government, who devote their researches to the improvement of the product. A new refining plant has been established at Valley Junction, near my county, and I am glad to say that this government helped in the construction of that plant in 1931 under the unemployment relief scheme. This will be a great benefit to the maple sugar producers in my county and in the municipality of Valley Junction. I should like to thank the Solicitor General (Mr. Dupre) who supported my humble efforts to have the government cooperate with the province of Quebec and the municipality in the construction of this plant.
May I add that since we have been in power we have lost no opportunity to help the maple sugar industry. In December of 1930, for instance, we put into force by proclamation the Maple Sugar Industry Act and

The Budget-Mr. Luchkovich
Regulations which, in a letter to myself dated March 4, 1932, the Minister of Agriculture (Mr. Weir) described as follows:
The Maple Sugar Industry Act and Regulations . . . became effective one year ago. It benefits the industry by prohibiting the adulteration of maple products, by establishing standards of quality, by requiring sanitary conditions in sugar camps and processing plants, and by requiring proper identification of table syrups or sugars which resemble or imitate the pure maple products. The fruit branch, charged with the administration of this act, has conducted some educational work in regard to maple products which, with the administrative work in regard to the act, will undoubtedly stimulate the interest of the producers in the production of quality products and tend to increase the demand for maple syrup and sugar, not only from the housewife but from manufacturers of ice cream, confections, etc.
As I said a moment ago, Mr. Speaker, the inclusion of maple sugar products under the proposed stabilization fund will prove a substantial help to the industry, but on this side of the house we propose to do more to encourage the maple sugar producers in Canada. Last fall, for instance, just after the Imperial conference, Mr. Vaillancourt went to England, where he succeeded in organizing successful exhibitions of maple products in London, Liverpool, Plymouth and Glasgow, Scotland'. He even went to France, where he tried to promote the sale' of 'Canadian maple products. I have several times requested this government to cooperate with the provincial government of Quebec in that regard by enacting new tariff regulations which will prove more favourable to the sale of maple products in England and France. I understand that within a few days we hope to conclude a new trade treaty with France, and I would ask the Minister of Trade and Commerce (Mr. Stevens) to take the necessary steps to see that Canadian maple sugar and syrup are allowed free entry to the French market. At the same time I would ask the minister to open negotiations with the British government in order that our maple products may secure a more favourable rate of duty. It is true that Canadian maple sugar and syrup enjoys a preference on the British market at present, but I would ask that the necessary steps be taken to ensure the entry of Canadian maple products to the British market free of duty.
I do not like to detain the house too long, but I had three reasons for bringing up these points. The first was to prove to my constituents in the county of Dorchester, many of whom are engaged in the maple sugar industry, that this government is doing its best to 53719-248J
help them. My second purpose was to show that the government was extremely willing to cooperate with the provincial authorities, and in the third place I wanted to prove to the house that the imposition of a tax on refined sugar would be very helpful to the producers of maple products in Canada. These producers are not only in the province of Quebec; there are a great many of them in the province of Ontario and in the maritime provinces as well.


Mr. MICHAEL LUCHKOVICH (Vegre-ville):: Mr. Speaker, I agree with what was said by the brilliant member who just sat down (Mr. Gagnon) with regard to the banking commission, the lowering of the legal rate of interest and the bonusing of wheat, but I hope he will pardon me if I do not follow him in the rest of his remarks, because of the time limit that has been imposed upon me by a rule of this house.
I do not think a single member of this chamber will disagree with the Minister of Finance (Mr. Rhodes), when he says that the world is approaching full realization of the fact that the day of national self-sufficiency is past, that an international disease can be cured only by an international remedy. The remedy for Canada's ills, however, must be sought both internally and externally; indeed I think all the countries in the world must take steps not only to put their own houses in order but to advance the cause of mutual cooperation among all nations before the world can enjoy if not greater prosperity then at least some semblance of the prosperity that existed prior to 1929; but in order to attain this goal the obstacles standing in the way first must be removed.
It has been said that many of our troubles are the result of the great war and that the various countries cannot rehabilitate themselves unless there is a cessation of martial strife and dissension. The desire for peace is general, Mr. Speaker, but, like the weather, everyone is talking about it and no one is doing anything about it. The Prime Minister (Mr. Bennett) soon will depart to Washington to confer with President Roosevelt and the Prime Minister of Great Britain, and so I believe the right hon. gentleman should do everything in his power to bring about those conditions that are essential to peace. At the present time the world is clamouring for peace but there is no peace. It is also awaiting the return of prosperity but there is no prosperity. We cannot have prosperity with-

The Budget-Mr. Luchkovich
out the propagation and the realization of peace, neither can we maintain peace without an application of the contributing factors or conditions essential thereto, nor a return of prosperity without the cultivation of the peaceful arts and pursuits incidental thereto that are so obligatory during a period of reconstruction in the midst of which all countries find themselves to-day.
It is said, Mr. Speaker, that a prolonged period of sickness usually is followed by an even more prolonged period of convalescence. We have had a sickness lasting four years, and if that dictum is true it will be another ten years before we are completely out of this depression. In the past four years financial stringency and economic chaos have brought out the reality of the interdependency of nations in much bolder relief than ever and have emphasized the utter impossiblity in this great age of industrial development of any country living unto itself. Even in the United States, where such pet phrases as "self-contained nation," "splendid isolation" and "no foreign entanglements," were so long in vogue, the president has put himself on record in regard to the interrelationship of the constituent parts of the world and the dependence of America's future on the successful solution of universal economic troubles.
As regards Canada and the United States, I am of the opinion that our troubles can be traced directly back to Europe, where the present conditions in this country have for the most part originated. I believe that for immediate causes we must refer to the lack of purchasing power of our customers overseas. There is no doubt that if Europe cannot buy, America cannot sell, Canada's difficulties have been greatly enhanced by the fact that she is largely an exporting country, especially of wheat and other agricultural products. For many decades the European market has absorbed the exportable surplus thereof, but of late years accumulating bankruptcy consequent upon the last great war has left this great .market of ours, Europe, so weak and impoverished as to make it quite impossible to maintain anything like that trade which the European market used to call forth in pre-war days. For things have come to a pass, as has been suggested by the Minister of Finance and by the president of the United States, whereby our neighbour's troubles are merged with our own difficulties, and where the latter cannot be solved without simultaneous solution of the former.
The duty of governments, to my way of thinking, must necessarily be twofold-stabilfMr. Luchkovich.]
ization and improvement of both internal and external relations. Now, domestic conditions must be met with some new form of adaptability, whether monetary or otherwise. National stability is essential, but so is international stability; but in order to maintain the former the nations are adopting at the present time methods which simultaneously destroy the vital mechanism of international exchange. The Minister of Finance has announced with great pride a favourable balance of some $70,000,000 odd; in other words, while imports were being restricted exports nevertheless were expanding, creating the aforementioned balance. If nations are as interdependent as the Minister of Finance pointed out in the introductory remarks of his budget address, I do not see how he can logically advocate interdependence and favourable trade balances at one and the same time; for I do not see how all countries, together and at the same time, can send out greater exports and take in fewer imports. Every debit still requires a credit, and it is a physical impossibility for all countries simultaneously to have a favourable balance of trade or even of payments.
I have referred to Europe as our great customer and have casually mentioned the obstacles that bar the way to trade with said continent. A manifesto issued by two hundred bankers and manufacturers representing all the nations of the world has this to say:
It is difficult to view without dismay the extent to which tariff barriers, special licences and prohibitions since the war have been allowed to interfere with international trade and to prevent it from flowing in its natural channels.
The break-up of great political units in Europe dealt a heavy blow to international trade. Across large areas, in which the inhabitants had been allowed to exchange their products freely, a number of new frontiers were erected and jealously guarded by customs barriers. Old markets disappeared. Racial animosities were permitted to divide communities whose interests were inseparably connected.
To mark and defend these new frontiers in Europe, licences, tariffs and prohibitions were imposed with results which experience shows already to have been unfortunate for all concerned. One state lost its supplies of cheap food, another its supplies of cheap manufacture. Industries suffered for want of coal, factories for want of raw materials. Behind the customs barriers new local industries were started, with no real economic foundation which could be kept alive in the face of competition by raising the barriers higher still. . . . Too many states, in pursuit of false ideals of national interests, have imperilled their own welfare and lost sight of the common interests_ of the whole world by basing their commercial relations on the economic folly which treats all trading as a form of war.

The Budget-Mr. Luchkovich
There can be no recovery in Europe till politicians in all territories, old and new, realize that trade is no war, but a process of exchange, that in time of peace our neighbours are our customers and that their prosperity is a condition of our own wellbeing. If we check their prosperity, their power to purchase our goods is reduced.
It is expected that the Prime Minister of this country will attend the world economic conference some time this spring or next summer, and that 'he will exert the weight of his influence to help to restore some stability to the situation overseas. As a great exporting nation we need that market very badly; for every restriction and curtailment of our foreign trade must react most disastrously on O'ur primary producers, whose whole existence depends practically on the profitable sale of t'heir products in markets abroad. At the present time there is no profit in farming in Canada. All operations are on the debit side of the ledger. It is thus impassible to continue an such a basis, for unless the trade situation improves and better methods of distributing our products are evolved, agriculture in this country is bound to be ruined; and when an industry like agriculture fails, at is bound to have serious and adverse repercussions and reactions on all other industries in Canada.
It is folly to deny the worldwide nature of the depression and that the crisis in Canada is due to the breakdown of our own foreign markets. It is equally futile to ignore the existence of vast domestic problems that call for immediate solution in Canada and the necessity of setting our own house in order so that we might adjust ourselves more effectively to world conditions. In stressing the influence of world conditions, I hope that we in this country are not seeking an alibi for Canada's lack of policy; for this reference emanates from a realization [DOT]that trade is not war but a process of exchange. Trade being essentially barter, debts can be paid in the long run only in goods, and we cannot continue to sell abroad without buying from abroad. In spite of the fact that science has accomplished wonders in making the world a harmonious whole, extreme nationalism the world over has managed to divide it, as it were, into many parts and to keep it from forming any close alliance which would react beneficially not only to each component part but to the collective whole as well.
There is no doubt that the problem arising out of the wheat situation has been made harder to solve by the futile attempt at selfsufficiency being made by such nations as Germany and Italy. These countries have
attempted an artificial stimulation of industries for which they are not fitted. Wheat growing is not a natural industry for a country like Germany. Her soil is not adapted to it, yet every effort is being made to encourage production through the bonusing of German farmers and the raising of high tariff barriers against other countries. In this act of intense economic nationalism Germany has been actuated by a desire to make herself independent of other nations in case of war which seems to be looming everywhere upon the horizon in Europe. I think the experiment has proven to be too costly. It is far more economical to import wheat from countries where it can be produced more cheaply and exchanged for the cheaper manufactures of other countries. It may be an exaggeration of the case, but what would we think of Canada trying to produce under hothouse conditions an independent crop of bananas or oranges when these products can be brought in from other countries where their cultivation is indigenous to the locality and where the cost of production and the ultimate sale price make it more desirable as an export than as a domestic product? Wheat raising has always been indigenous to this country. With her favourable climate, with her progressive people and with her fertile soil, there is no place in the world where a better grain product can be produced than in Canada. Wheat is now our great staple export product. In 1929, the peak year of prosperity, nearly forty per cent of our total exports valued at more than half a billion dollars were grain products. It was through the grain trade that Canada reached her peak of prosperity and it is through the same trade that Canada will regain her prosperity. This is the problem which Canada's representatives at the forthcoming world economic conference must undertake to solve successfully. The present economic condition of Canada, especially in the west, is so precarious that further delay will be serious.
I agree with the hon. member for Souris (Mr. Willis) when he includes the tariff as one of the disturbing factors in trade recovery and I agree especially with his reference to the multilateral agreements which are essential to tariff revision. One country cannot do it alone by means of a unilateral agreement but all countries acting in unison and cooperation can do a great deal in this regard. Therefore, let us hope that the economic conference will be the means of bringing about these changes without any further delav

The Budget-Mr. Luchkovich
Canada with her meagre force under arms and her four thousand miles of undefended boundary should be an example to the rest of the world, especially to Europe, now torn by stress and bitter racial animosity, of the benefits of disarmament, of the virtues of peace as the essential conditions of prosperity. When one realizes that during the last war 65,000000 men were mobilized and out of 37,000,000 casualties, 9,000,000 died, that the cost of the war is now rapidly approaching $100,000,000,000, these figures will give some idea of the devastating effects of warfare upon the morale and economic conditions of a country. The manhood which has been, destroyed cannot readily be replaced and its disappearance has left a void which has had a terrible reaction upon the spiritual and economic wellbeing of the world. There cannot be prosperity without peace, and peace is unlikely without disarmament. Therefore, I feel that the forthcoming visit of our Prime Minister to other lands should have something to do with this all-important subject. I am reminded of an allegorical story which I read recently in a magazine. Some worms and caterpillars in a chicken yard decided to have a conference with the chickens, and for this purpose they appointed a committee. This committee was well equipped with logic and with oratory but it did not know how to speak the chicken language, so they were forthwith gobbled up. Chicken yards are bad places for worms. There is no question that a heavily armed nation will use its instruments of war to defeat an unprotected nation, and to reduce it to subservient slavery and national oblivion. The only alternative is peace through disarmament.
The stagnating influence of war debts is too obvious to require any extended explanation at the present time. There are many reasons for drastic reductions, the most important of which is the fact that war debts are a great impediment to the recovery of prosperity. So many anomalous situations have arisen since the war that it has become impossible to pay, no matter what the good faith of the [DOT]nations may be. There are three ways in which payment can be made: first, by goods and services; second, by the proceeds of a loan, and, third, by the movement of gold. Owing to the terrific fall in the wholesale price level, it has become necessary to pay in increasingly larger quantities of goods and services; the precariousness of the economic situation has made it harder both to secure md to pay a loan, and the disequilibrium of

gold and its concentration in few hands has made it impossible to pay balances in that standard. War debts are a dead asset; they are not a productive asset as railways and the sooner they are wiped out the better it will be for the world generally. I should like to quote a little passage by Walter Lippman as follows:
There will be no economic stability until there is peace, and the world war is not over while the question of reparations and war debts is still alive. If the world can make peace and settle war debts and reparations, there will be such a return of confidence that prices will rise permanently.
The real point is tiha,t the countries still on the gold standard, the United States and France, have forced other countries to deflate and this deflation has forced down prices. If such emergencies were managed more scientifically by a controlled currency .there would be mo need for the sad state of affaire which we have in the world to-day. lit is essentially a monetary and credit crisis, the fundamental cause of which can be given in the words of a New England weekly-a systematic creation and increasing disparity between physical means of production and financial means of consumption. We know how to produce and can produce in apparently limitless quantifies, but where we fall down is in distribution. Our system is operated for profit, and when that element or motive fails, the whole structure topples over like a house of cards. Can one imagine thousands of cattle being burned, shiploads of coffee and oranges being dumped into .the sea and other products deliberately destroyed because of the lack of profitable markets and efficient methods of distributing our superabundance of goods to a starving consuming public? But tha/t is exactly what is happening in profit-making capitalistic civilization to-day where human values are sacrificed for individual gain and the ideal of service is superseded by the pursuit of economic reward.
If the government persists in laying the blame for this depression on the international situation and in seeking an international remedy to cure an international disease, then they should at least make some move in this direction. The Prime Minister of course might ask for -a complete revision of the Versailles treaty, the remaking of the map of Europe, not in accordance with the vindictive spirit of the makers of this treaty, but on the basis of justice and ethnic principles, such as race, religion and language of the inhabitants involved. The gnawing bitterness, the smouldering fires and antagonisms that

The Budget-Mr. Luchkovich
prevail so persistently throughout that greatest of our markets are mostly due to the forcible suppression of 'the various nationalities. This, I think, is 'the key to the situation. We should do everything possible to create ethnographical boundaries and to allow the self-determination of the nations in that greatest market of ours in keeping with their innate traditions and aspirations. The Prime Minister will realize bow extremely galling it is for these people to live in continual physical and spiritual subjugation and forced negation of the very qualities which are considered a virtue in those who rule but a sin in those who unfortunately come under domination. My observation has been that these people somehow will not stay down, and as history has given us countless examples of the folly of forcible suppression, I [DOT]think nothing but a guaranty of autonomy and liberty of cultural development will free Europe from its potential menaces to peace and well-being.
At 'the present time all those races ore more interested in political than economic liberation. They all wish to be treated as equals and not as inferiors, but once the former object is attained, they will then be unhampered in their cooperation in the latter. As matters stand, economic liberation is subordinated to political liberation, for the races seem determined to free themselves politically even if their efforts meet with untold misery, suffering and spiritual degradation. All these realities must be taken into consideration before the status of Europe is finally decided. The united states of Europe is a most desirable object for the economic salvation of that continent, but it con be attained only when all those races enter such a union voluntarily and are accepted as equals.	_
The era through which humanity has just passed might be called the age of frenzied finance. The next stage therefore will logically be one of stabilization and social control. I think the laissez-faire, rampant individualism of the past must give way to greater socialization under government supervision. The decay of vigorous predatory imperialism brought about by the awakening of the economic energies of undeveloped countries and the reduction of international trade to the interchange of products required by the mere difference in resources, climate or racial habits, the disintegration of our political situation and a host of minor problems have forced a reorientation of thought and a revaluation of ideas arising out of the realities of present day conditions.
Once again, the science of economics, being dynamic, has become subject to change. As in many other matters, so in this case nothing is ever learned definitely and completely and so the methods of the past century cannot be applied to twentieth century conditions. The present budget does not offer any solution for our difficulties beyond retrenchment, drastic economies, increased taxation, sanctity of contractual obligations and a policy of let well enough alone. But even in the case of drastic economy and taxation, the burden and incidence thereof might have been placed equally on those higher up rather than on those least able to pay. In times like these and under the present system new taxation cannot be avoided, but there should be more equality in the sacrifice. No one will quarrel with the desire for equal sacrifice, but as drastic economies and retrenchment will not solve the problem of unemployment and farm relief, one must look to more fundamental remedies for a solution.
The minister mentioned relaxation of exchange and other excessive restrictions on international trade, stabilization of currencies and stimulation of a rise in wholesale prices as fit topics for discussion at the next economic conference. He might also have added the inadequacy of gold as a metal standard as regards both quantity and efficacy, and the general problem of financial credit as the pivot of the whole economic structure. Economists are in agreement that the problem of the price level is the most important single one of our age and that low prices are due to deflation of credit. Mr. Cassel has pointed out that progressive deflation is grinding our national economy to pieces and that unless something is done to stop the process, it will mean the ultimate ruination of our country. There must be some antidote to the destructive policy of deflation, and if inflation will supply this function, as I think controlled inflation should, then I see no valid reason why it should not be employed.
Mere policies of retrenchment and aimless, hopeless groping in the dark will get us nowhere; unless governments try to do something to pierce through the economic fog in which we are at present enveloped and bring to light some constructive policy, ultimate collapse cannot be avoided. It may be good tactics to raise the bogy of contractual obligations and the sanctity of the bond, but why the bondholders should be placed in a different category from that in which others are situated is, in my opinion, very hard to justify. The Minister of Finance has spoken of equality

The Budget-Mr. Luchkovich
of sacrifice; why should other classes be more amenable than are the bondholders? In a period of progressive deflation I do not see why the prosperity of the average man should be subordinated to the greed and avarice of a few moneylenders. As far as the average man is concerned, deflation has knocked the bottom out of every vestige of prosperity he ever enjoyed, and it has destroyed the equity in whatever property he may at any time have owned. It has put about 1,500,000 Canadians on relief. As a recent writer put it, to-day the average man thinks not of prosperity but of a job, not of profits but of wages. But a search for one or the other is like hunting for the needle in the proverbial haystack. Hon. members may perorate as much as they like about the virtues of individualism. But, Mr. Speaker, what is there left of opportunity to the average man? I think that even such men as Lord Strathcona and Mr. Bboth, those individual giants of the past, would not get very far with their individualism and their initiative at the present time.
An lion, member has asked what the duty of a government is. Adam Smith said the duty of any government is to increase the wealth of its people. In the absence of opportunities for employment the state is faced with the necessity of assuming the responsibility for the subsistence of its citizens. With the right to such subsistence must also go the imposition of the duty to work. This, of course, will require social and economic planning on a very much larger scale. How it can be done without the inflation of our currency and without simultaneously launching a constructive public works program is very hard to understand. Up to the present time the government has managed to avert responsibility of control of industry-I speak not of one government but of governments throughout the world. However, the inevitable trend of the times lies most certainly in the direction of government control. Mr. G. D. H. Cole had this to say:
Parliaments, if they are to survive as sovereign, have to find ways of bringing the economic life of the nations under their effective control; for this economic life is crying out for organization, for national and economic planning. And if parliaments resign this task into other hands they will, under modern conditions, be throwing away the substance of authority, and keeping only the shadow.
Much has been said in this house and out of it about the glories of individual initiative and private industry. If private industry is as has been pictured, why is it that all the 
wrecks and derelicts thereof must be taken care of not only by this government but by all governments? Why is it that even ablebodied men and women cannot secure work in private industries? Hon members in both major parties do not want inflation, but certainly with the continuation of deflation, higher taxation, higher interest rates and other charges, diminishing purchasing power and increasing unemployment, I do not see how it can be avoided.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.
PRIVILEGE-Mr. MacLAREN


Hon. Mr. MURRAY MacLAREN (Minister of Pensions and National Health):: Mr. Speaker, I rise to a question of privilege. I have read in this evening's Ottawa Journal a short article purporting to give the report of a meeting of several members of the government with representatives of the Associated Veterans. I wish to state that it is quite inaccurate. We did have .a meeting this morning to talk over the proposed new pensions bill, which is under consideration, but no mention whatever was made of any reduction in the pensions now being paid.



PRIVATE BILLS


[Stage Direction]
The house resumed from Friday, April 7, consideration in committee of Bill No. 41, to incorporate the Sarnia-Port Huron Vehicular Tunnel Company-Mr. Gray-Mr. Plunkett in the chair.
Section 1 agreed to.
On section 2-Declaratory.
Mr. HANSON (York-Sunbury):: What is
the purpose of having this work declared to be for the general advantage of Canada?


Richard Bedford Bennett: Because it is international work.


[Stage Direction]
Section agreed to.
Sections 3, 4 and 5 agreed to.
On section 6, subsection 1-Capital stock.
Richard Burpee Hanson: I should
like to ask the promoter of the bill if he thinks $25,000 is a sufficiently large paid up capital upon which to commence operations. It seems to me to be ridiculously low.

Samia-Port Huron Tunnel


Mr. GRAY:: The hon. member will note
that that sum is merely a deposit left as security with the government. The hon. member is reading subsection 2, which refers to the deposit guaranteeing that the work will be proceeded with. It has nothing to do with the capital stock mentioned in subsection 1.


Sir GEORGE PERLEY:: Is there any provision in the bill stating how much shall be paid up before the work is commenced?


Ross Wilfred Gray: The hon. member for Argenteuil will note that under section 21 of the bill the Dominion Companies Act shall apply, so far as it is not inconsistent with the special provisions of this bill. Therefore my opinion is that with respect to the commencement of business and the amount required to be paid up before the commencement of business the Dominion Companies Act shall apply.


Richard Burpee Hanson: There is
nothing in the Companies Act which requires any amount to be paid up, with the exception of the corporation shares.


Ross Wilfred Gray: There used to be a provision for ten per cent. As I understand it, that provision was eliminated in 1930. At the present time there is a provision that a certain amount-I realize it is not very large -must be paid. I do not see why we should go beyond the provisions of that act when we are considering the amount to be paid up under this bill.


Mr. NICHOLSON:: Have all the subsections with the exception of numbers 1 and 2 been struck out of the original bill?


Ross Wilfred Gray: The whole bill has been
reprinted. If the hon. member has a reprinted bill he will find the proposed changes underlined, and in italics on the page opposite he will see the sections as they appeared in the original bill.
Section 6, subsection 1, agreed to.
On section 6, subsection 2-Deposit before commencing operations, etc.


George Halsey Perley: If this company is granted a charter, I know nothing in the Companies Act -which will force them to put up any substantial sum before beginning operations. When, a company has power to issue bonds to the value of $5,000,000, it certainly should put up a substantial sum before actually beginning work. A large enterprise such as this should have substantial backing.
I do not know- who the incorporators are, or whether they are men of large means able to carry on an undertaking of this magnitude, but I suggest there should be a provision for a large amount to be paid up before the company begins business.


Ross Wilfred Gray: Is the right hon. gentleman
discussing subsection 1 of section 6, or subsection 2.


George Halsey Perley: Subsection 2.


Ross Wilfred Gray: Subsection 2 provides only for a deposit being put up in good faith by the company. It merely provides that the company shall not commence its operations or incur any liability before a sum of at least $25,000 has been paid into the treasury of the Dominion of Canada, which sum shall not be withdraw-n until at least twenty-five per cent of the proposed subway or tunnel together with its approaches, buildings, and all other assets used in connection therewith is constructed, and such sum shall be forfeited if the project is not proceeded with. In my opinion subsection 2 is merely a guarantee that when commenced, the work will be proceeded with, and if not the moneys will be forfeited to the crown. I submit subsection 2 has nothing whatever to do with subsection 1, which deals with the capital stock of the company. With respect to the amount to be paid up under subsection 1, I again submit that we are under the Dominion Companies Act, w-hich has withstood the experience of time.


George Halsey Perley: I am sorry I have not the Companies Act before me, but if the hon. member has I wish he would read the provision contained therein in regard to paying up capital stock before the commencement of work.


Ross Wilfred Gray: As a matter of fact I have
only the revised statutes of Canada, 1927. Subsection 8 of section 9 of the Companies Act states:
In no case shall the amount of capital with w-hich a company shall carry on business be less than the sum of $500.


Richard Burpee Hanson: That is
the only limitation suggested?


Ross Wilfred Gray: Yes, as it exists now. The
ten per cent provision is now out, and as I understand it under the Dominion Companies Act there is only now the $500 limitation.
Sarnia-Port Huron Tunnel


George Halsey Perley: The hon. gentleman says this is the course usually followed in private bills relating to private companies, but I submit for his consideration that although this is a private bill it is far from being a private company. This is going to be a public corporation, an international enterprise, for the building of an expensive tunnel. I know that some very unfortunate things have happened in connection with a bridge further down the river, built not long ago, in connection with which bonds were sold which now have comparatively little value because I suppose there was not sufficient money put up for stock ahead of the bonds to give them some value outside of the actual tunnel itself.


Ross Wilfred Gray: I agree with what the hon. gentleman says. To meet that very difficulty, at the suggestion of the Justice department we have incorporated in this bill subsection A of section 7, and I submit that it will meet with the approval of the hon. gentleman and meet the objection he has now raised. It is a new clause:
7a. No securities whether shares of stock, bonds, debentures or other securities shall be issued by the company unless and until the governor in council has been satisfied that the company has, in respect of such securities, complied with "The Securities Act" of the province of Ontario.
That is what is popularly known in Ontario as the Security Frauds Prevention Act. I hope and trust that will meet the hon. gentleman's objection.


[Stage Direction]
Section agreed to.
On section 7-Bonding powers.
The CHAIRMAN (Mr. Plunkett):: There is a slight change in this section, therefore I will read the whole section:
7. The company may issue bonds, debentures or other securities to an amount not exceeding five million dollars in aid of the construction of the said subway or tunnel authorized by this act; and such bonds, debentures or other securities shall be secured by deed of mortgage; and such deed of mortgage shall contain provisions that all tolls and revenues derived from the use of said .subway or tunnel by other corporations or persons shall be specially charged and pledged as security for the payment of interest on such security.


[Stage Direction]
Section agreed to.
On section 7, subsection A-Issue of securities.
Richard Burpee Hanson: Would the promoter be good enough to tell the committee just what are the safeguards for the public under the Securities Act of Ontario?
[Mr. Gray.l


Ross Wilfred Gray: I wish to take issue with my hon. friend as to my being the promoter.


Richard Burpee Hanson: I apologize -the sponsor.


Ross Wilfred Gray: Thank you. As I understand the act it has to do with the registration of any broker or issuer of stock before stocks or bonds or debentures can be issued. The provisions of the act require registration and licensing to sell, and in its very nature the suggestion of licensing must mean protection as far as possible to the public. In order that we may ensure compliance with that provision, this subsection is inserted.


[Stage Direction]
Subsection agreed to.
Sections 8, 9 and 10 agreed to.
Ou section 11-Powers.
D'Arcy Britton Plunkett: There is a slight change in this section:
11. The company may,

(a) lay out, construct, complete, maintain, work, manage and use the said subway or tunnel under the St. Clair river, for vehicular, pedestrian, railway and other purposes, with the necessary approaches from convenient points on the Canadian side of the international boundary between the United States of America and the Dominion of Canada in or near the city of Sarnia, the township of Sarnia and the township of Moore, to points in or near the city of Port Huron, and the city of Marysville, in the state of Michigan, one of the United States of America.
The former paragraphs lettered (f) and (h) are deleted, therefore paragraph (g) becomes (f); (i) becomes (g); (j) becomes (h); and paragraph (k) becomes (i).


[Stage Direction]
Section agreed to.
Sections 12 and 13 agreed to.
On section 14-Expropriation.
Richard Burpee Hanson: Very large powers are being given to a private company under this bill. It occurs to me that they are rather unsusual powers to be given to a company of this kind. While the provisions of the Railway Act are made to apply, I should think that that is not all the safeguard that should be made applicable in such a bill as Ibis. Giving to a private company which is promoted for private gain the power to take the property of others against their will is something which should be done very sparingly by any legislature. I can remember a long series of battles over this very same sort of thing. While it is necessary in railway development or in works of great public utility to give this power, there is strong objection to giving it to such a company as this, which is

Sarnia-Port Huron Tunnel
not in the same category as a railway or other public utility. I for one object to the powers of expropriation that are given under this bill.


[Stage Direction]
Section agreed to.
Sections 15 to 18 inclusive agreed to.
On section 19-Municipalities may purchase tunnel.
Mr. MORAND:: No doubt the intention of this section is that the municpalities may have the opportunity, at some time in the future, to purchase this tunnel, but I would suggest that in the third line the word "value" be replaced with the word "cost." The value might be ascertained with the company considered a going concern, having no regard to the cost of the undertaking.


Ross Wilfred Gray: I have no objection to that change.


Richard Bedford Bennett: This is a very serious section. Air. Chairman, and in the form in which it now stands I think the committee should hesitate to pass it. Whatever else should be done at least we should exercise what jurisdiction we have within our powers, ostensibly at any rate. I do not think we have any power to say the board of arbitration shall have power to fix the cost or the value if one of the members of the board is without the jurisdiction of this country.


Ross Wilfred Gray: Is that the suggestion?


Richard Bedford Bennett: Yes. The section declares :
The board shall consist of three members, one to be appointed by the city of Sarnia or the municipality within the Dominion of Canada in which the portion of the said subway or tunnel in Canada may be constructed, one by the city of Port Huron or the municipality within the Lhiited States of America in which the portion of the said subway or tunnel in the United States of America may be constructed and the third by the company.
In this section the tunnel is dealt with as an entity, both ends being united as one, whereas in the previous sections the statute makes it clear beyond doubt that we do not endeavour to exercise jurisdiction beyond the centre of the stream. I am bound to say that I do not think the section as it now stands is one we have power to pass.


Ross Wilfred Gray: I understand the point raised by the right hon. gentleman. I am not particularly' enamoured of the section in any shape or form. As the hon. member for East Essex suggests, apparently the intention of the section was to have some recapture clause in the bill.


Richard Bedford Bennett: And there should be one.


Ross Wilfred Gray: As the right hon. gentleman points out, there should be one. I would be quite content to have the section wiped out if it were not for the suggestion of the Prime Minister that some recapture clause should be placed in the bill. If the right hon. gentleman retains that point of view I suppose there is no alternative but to have the section stand, otherwise I am quite prepared to agree to the deletion of the section.


Richard Bedford Bennett: During the last two
months my attention 'has ibeen directed to the somewhat similar provisions of the statute concerning the bridge lower down, and if my attention had not been directed to that perhaps I would not have read 'this bill so closely. It does seem to me that it is perhaps desirable that there should be some form of what has been familiarly called-though it is not technically correct-a recapture clause in a bill such as this. I think the hon. member for East Essex has put his finger upon the real difficulty, the question of fixing t'he actual cost of the undertaking early in its period of operation. We are familiar with proceedings that have taken place in connection with matters of this kind in which the value bears no relation whatever to the cost, the value being determined largely by the earnings and the percentage of the return upon the investment. When. I heard the hon. gentleman from East Essex make his observations with regard to value I thought that was very important, but I -think the bon. member will agree that the section must be recast. As it stands now it undertakes to do something which I fear we have not 'the power to do, and I suggest that it might be better to have a section stating that the cost of the undertaking must 'be made clear to the satisfaction of the governor in council, and that should be lodged with the Department of State, and then the provisions as to recapture might be dealt with.


Ross Wilfred Gray: Then I would suggest that
the section stand.
Section stands.
On section 20-RB., c. 170, to apply to the company.


Richard Bedford Bennett: I direct the attention of
the committee to the fact that both these sections are striking illustrations of the doctrine to which the hon. member for West Lambton referred the other evening.


[Stage Direction]
Section agreed to.
Sarnia-Port Huron Tunnel
[Stage Direction]
On section 21-R.S., c. 27, to apply.
George Brecken Nicholson: When this section was before the railway committee it was agreed by the promoters that it Should be changed in order to bring this company within the Companies Act when it was not inconsistent with the Railway Act, instead of taking out this act from under the Companies Act when that general act was inconsistent with this aot. I think the sponsor of the bill will agree to that statement.


Ross Wilfred Gray: If the hon. member will look at the reprinted bill he will find 'that this has been done. Section 21 now reads as the hon. member suggested it should read.


George Brecken Nicholson: I have the reprinted
bill, which states clearly that the Companies Act shall apply, so far as it is not inconsistent with the special provisions of this act. If I understand that, it simply means that this act overrides the Companies Aot, instead of the Companies Act prevailing where there is any inconsistency. There can be no question as to that.


Ross Wilfred Gray: Perhaps the right hon. Prime
Minister would express an opinion.


Richard Bedford Bennett: This is my hon. friend's
bill.


[Stage Direction]
Section agreed to.
On section 22-Labour and materials.
Richard Bedford Bennett: I think my bon. friend
may find a little difficulty here. The section.
reads:
So far as it may be practicable to do so. Canadian labour and materials must be used in the construction of the said subway or tunnel. . . .
He may find a little difficulty in connection with that provision in the state of Michigan.


Ross Wilfred Gray: This section has been included in all international bridge and tunnel bills since 1929 or 1930. It may be, as the Prime Minister says, that it is more a pious hope and prayer than something that will be of practical benefit. The intention is that, in so far as we do not overlap the international boundary, so far as the approaches to the subway or tunnel are concerned, we shall use Canadian labour and material in the work that is done. If our American friends do not like the section, then I suppose they will object to it; but in the meantime I am rather surprised that the right hon. gentleman should object that as far as possible we are protecting Canadian labour and material.
fMr. Bennett. 1


Richard Bedford Bennett: How unfair the hon.
gentleman is. The remark is rather cheap. I directed his attention to the fact that the bill as it now stands undertakes to legislate The Fair Wages and Eight Hour Day Act, 1930, to apply to the United States, which it cannot do. The section reads:
The employment of labour in the construction, maintenance and supervision of the said subway or tunnel shall be subject to the terms and conditions of The Fair Wages and Eight Hour Day Act, 1930.
Just as the congress of the United States would not undertake to legislate with respect to the Dominion of Canada, so we should not undertake to legislate with respect to the United States; and because I direct attention to that fact the hon. gentleman, with a cheap sneer, says he is surprised that I should object to Canadian labour and material being used. That is unworthy of him; let me say that to him at once.


Ross Wilfred Gray: I apologize if-


Richard Bedford Bennett: I have given every possible assistance in connection with this legislation, and I was merely pointing out that it is not desirable that this dominion should leave the impression abroad that it is endeavouring to legislate in a country over which it has no legislative jurisdiction.


Ross Wilfred Gray: I had no intention of arousing-


Richard Bedford Bennett: The hon. gentleman is
not arousing anything.


Ross Wilfred Gray: -any suspicion of a sneer. I was not sneering. As the right hon. gentleman says, he has given every assistance and afforded every opportunity to have the bill presented and passed. This section was discussed at great length in the committee, and the committee thought that as far as practicable it should be insisted upon that Canadian labour and material be used in the construction of every international bridge or tunnel. There is an international half of the construction over which we have control and an international half which is under the control of congress. We are providing against the fact that there may be overlapping by declaring that as far as practicable we shall use Canadian labour and material in our section, and apply to the work carried on in that section The Fair Wages and Eight Hour Day Act, 1930. Surely that has only to do with the Canadian section of the tunnel. I hope the Prime Minister will not find fault with the section. The committee gave it considerable

Samia-Port Huron Tunnel
thought and at the suggestion of the hon. member for London (Mr. White) and one of the members for Vancouver it was insisted that it should be made compulsory that Canadian labour and material be used.


Richard Bedford Bennett: If the hon. gentleman will look at the section he will see that the practicability is the test with respect to the use of Canadian labour and material, and properly so. But in a statute of the dominion we are providing that:
The employment of labour in the construction, maintenance and supervision of the said subway or tunnel shall be subject to the terms and conditions of The Fair Wages and Eight Hour Day Act, 1930.
They shall be subject-shall be-to the terms of a Canadian statute, and I only desire, being responsible for the bill in the narrow sense of the government's responsibility for the legislation of this house, that it should not be said that we had passed a statute in which we undertook to provide that a Canadian act, an act of this parliament, should govern the construction of this work. If the hon. gentleman would add words indicating that the provision had reference to the Canadian section of the tunnel, I could understand it. That was what I was painting out.


Ross Wilfred Gray: I should not think that in this act we were legislating with reference to anything but the Canadian section.


Mr. GORDON:: It says differently, in terms. The forepart of the section distinctly comprehends the whole operation.


Ross Wilfred Gray: But we could not legislate, and the minister knows we could not possibly legislate, with respect to anything except the Canadian section.


George Gordon: Why try to do so, then?


Ross Wilfred Gray: We are not doing so, I submit. However, if it is desired for clarity's sake to insert, "in so far as the Canadian section is concerned," or words to that effect, I see no objection to doing so.


George Gordon: We are all trying to assist the hon. member, and if the bill is desirable, as I assume it is, it seems to me that he would meet with an insuperable barrier when he approached the government of the United States, where there must be a companion bill, if they found in our legislation th'at the whole subway and tunnel must be built subject to our Canadian laws in relation to the matter set out in the section. It is with the desire to assist the hon. member that the observations have been made. As the section reads,
it implies that our law is to apply to the whole building of the tunnel. Obviously therefore, unless the hon. member has some idea of what congress may do, this section will be an insuperable barrier to his operations later on, unless it is altered.


Ross Wilfred Gray: I suggest, then, Mr. Chairman, that after the word tunnel there be added the words "in so far as the Canadian section is concerned."


Richard Burpee Hanson: Has the
hon. member received any opinion from the Department of Justice or from any other source as to the constitutionality of the whole section?


Ross Wilfred Gray: I can only say that I have looked at similar bills passed in which there was a provision such as this-bills passed on two or three occasions.


Richard Burpee Hanson: I don't
dispute that.


Ross Wilfred Gray: I know that does not make it right, but I can assure the hon. member that the whole bill was submitted to the Department of Justice, though possibly they had not time to look into it very carefully. However, in view of the fact that section 19 has been allowed to stand, I am quite prepared to allow section 22 also to stand for recasting.


Richard Bedford Bennett: I suggest that the hon. member would meet the difficulty if after the word "supervision" he added the words "of the Canadian section," so that the section would read: "The employment of labour in the construction, maintenance and supervision of the Canadian section of the said subway or tunnel shall be subject."


Ross Wilfred Gray: I agree to that.


Mr. GEARY:: Has the hon. member considered how he is to make The Fair Wages and Eight Hour Day Act, 1930, apply? The language of that act is directed simply to government contracts, and unless he has precedents for its application to private contracts I doubt whether this section can be made effective. Has he considered that point?


Ross Wilfred Gray: I presume the intention is to make that act applicable to this legislation. The language contemplates that.


Richard Burpee Hanson: Has the hon. member given consideration to the practical effect of the words, "so far as it may be practicable to so do"?
3936	COMMONS
Vancouver, Victoria Pacific Agreement


Ross Wilfred Gray: I think it was the hon. member for North Winnipeg who stated that a section similar to this one was passed some years ago and has been working out quite satisfactorily as far as as labour is concerned.
Mr. HANSON. (York-Sunbury):	I have
often heard that member denied the right to speak for organized labour. He is not here to speak for himself, but if he said that it would not impress me at all.


Richard Bedford Bennett: I think the words "Canadian section of the" should be added after the word "the" and before the word "said" in the fourth line from the bottom of this section. If this were done the matter would be made clear in both cases.


George Gordon: I do not want to hold
up the passage of this legislation, but the hon. member for South Toronto (Mr. Geary) has just called my attention to the provisions of The Fair Wages and Eight Hour Day Act, 1930. In order that the progress of the work should not be rendered difficult by the wording of this section of the bill and in order that the operative provisions of The Fair Wages and Eight Hour Day Act, 1930, may apply, I submit that this section should stand for revision. The act to which I have referred applies only to government contracts and I think some explanatory note should be given in the bill to the effect that in fixing wages and hours of labour, this particular work shall be deemed to stand in the same position as a contract under the provisions of The Fair Wages and Eight Hour Day Act. Such an addition would dispel any difficulty which might lie in connection with the application of the statute.


Ross Wilfred Gray: Section 19 is standing and 1
have no objection to this one standing also.


Mr. MITCHELL:: By the time the construction of this tunnel is started there may be an entirely different fair wages act in effect, and I should like to have a clause inserted which will stipulate that the fair wages act in effect when the work is started shall apply.
Section stands.
Progress reported.



VANCOUVER, VICTORIA AND EASTERN-NORTHERN PACIFIC AGREEMENT

[Stage Direction]
The house resumed from Friday, April 7, consideration in committee of Bill No. 48, to confirm an agreement between the Vancouver, Victoria and Eastern Railway and Navigation Company and the Northern Pacific Railway Company-Mr. McDade.-Mr. Plunkett in the chair.
Progress reported.

[Stage Direction]
Mr. G. R. GEARY (South Toronto) moved the second reading of and concurrence in the amendment made by the Senate to Bill No. 29, to amend and consolidate the several acts relating to the Board of Trade of the City of Toronto.
Motion agreed to; amendment read the second time and concurred in.

[Stage Direction]
The house resumed from Friday, April 7, consideration of the motion of Mr. Power for the second reading of Bill No. 67, with respect to hospital sweepstakes.
Mr. A. M. CARMICHAEL (Ivindersley):: Mr. Speaker, when the hour for private bills expired on Friday last I had just completed a reference to the prevalence of speculation and gambling in the stock markets and had started to refer to the gambling carried on in our grain exchanges. I do not think I am exaggerating when I say that the speculation and gambling carried on in this and other countries during recent years have played a very large part in bringing about the depression now existing. I have given extracts from the evidence adduced in England before a commission dealing with a proposed sweepstake measure. I gave extracts from the evidence given by the representatives of the Church of Scotland and the Christian Social Council of England. I have had submitted to me the opinion of the United Church of Canada, and I should like to refer to a letter written by the Reverend D. N. McLachlan, the secretary of the Board of Evangelism and Social Service of the United Church of Canada. Mr. McLachlan points out, first, that the sweepstakes proposal is economically unsound and, second, that the principle is morally unsound. He continues :
The better elements of Canadian citizens view with regret and misgiving this backward step proposed by the Senate and are depending on the members of parliament to defend the honour of Canada by defeating the bill to legalize sweepstakes in this dominion.
I should like to quote from a resolution passed by the Kindersley presbytery of the United Church of Canada, as follows:
In the move to change the Criminal Code to permit the conducting of sweepstakes for the support of hospitals; this presbytery believing that the result would be a widespread development of the gambling spirit, which would more than offset any advantages which might be derived therefrom, strongly protests against any such action.

Hospital Siveepstakes
That resolution is signed by H. Craner, secretary, Coleville, Saskatchewan.
Every afternoon before the commencement of business in this house Your Honour reads a form of prayer, one day in English and the next in French. In the third clause of that prayer you, sir, invoke the Deity that He "be pleased to direct and prosper all their consultations," referring to the House of Commons:
That all things may be so ordered and settled by their endeavours, upon the best and surest foundations, that peace and happiness, truth and justice, religion and piety, may be established among us for all generations.
That is a very worthy sentiment, but the proposal of this sweepstakes bill is diametrically opposed to the sentiment expressed in that feeling prayer of yours as uttered every day in this chamber.
The sponsor of this bill asked: Why not let people gamble?-they have the gambling spirit anyway. He tried to impress upon us-[DOT] and he did not make a very good job of it, I will admit-that everybody is addicted to the gambling fever, so why not give him a chance to gamble? I challenge that statement; I claim it is not correct. Every person is not addicted to gambling and gambling is not a natural instinct. It would be just as sensible to say in this chamber that opium smoking on the part of a Chinaman was a natural habit and we might as well let him smoke his opium. So far as giving peace and exhilarating joy and transporting the individual into the realms of ecstasy and feelings of inward satisfaction are concerned, I am told nothing surpasses the smoking of the opium pipe. If such be the case, why deprive the poor Chinaman of that wonderful peace and satisfaction of mind which he has as a result of sm oking opium ?
The sponsor of this bill says that because some people get a little satisfaction out of gambling, we should throw the door wide open and let them gamble; they are raised to such heights of joy; they are given such wonderful feelings of ecstasy, it would be too bad to deprive them of that. But we do not assume that attitude towards the Chinaman who takes his long pipe and endeavours to smoke opium. We have legislation that applies to such a person and we take good care that he is restricted in his operations with the opium pipe. So, believing as I do that this bill is a retrograde step in our legislative enactments, I beg to move, seconded by the hon. member for Red Deer (Mr. Speakman), the following amendment:
That the word "now" be left out and the words "this day six months" added at the end of the question.


Mr. G. D. STANLEY (East Calgary):: Mr. Speaker, may I offer a few observations in regard to this bill? In the first place the proposal embodied in it is purely and simply gambling. It undertakes to legalize what, under our criminal code, is recognized as illegal. In other words, if I understand the matter correctly, the object of the bill is to give respectability to what is generally understood as an illegal undertaking in Canada, something that is made illegal under our criminal code. Gambling of all kinds is objectionable and this form of it is not any exception to the rule. It is well understood that during the last several years, particularly in 1928 and 1929, gambling was the great evil of this country and the source of most of the troubles from which we are now suffering. Particularly is this so in regard to many of our young people, and yet we are undertaking under this bill to make respectable that which we know introduced many of the troubles from which we are now suffering.
Another feature of the bill is that it throws around the ev il of gambling a certain mantle of virtue by introducing some benefit or presumed benefit on behalf of the hospitals. I am ready to admit that it is possible hospitals may be immediately benefited, financially speaking, but I am also firmly convinced that ultimately they will suffer financially as well as otherwise. At present in all parts of our country hospitals are benefited by the donations of the people and also very largely by contributions from estates. Even to-day where the formerly established practices in the administration of hospitals have been interfered with in one way or another by the state, there has been a decided tendency on the part of many people of means not to make in their wills provision for extending donations to hospitals. If gambling, presumably to assist hospitals, becomes law, I am certain this will in the long run be detrimental, financially speaking, to the hospitals. Certainly it will drive away from them a great deal of sympathetic support which they now receive and which they require.



THE BUDGET


[Stage Direction]
The house resumed consideration of the motion of Hon. E. N. Rhodes (Minister of
The Budget-Mr. Beynon
[Stage Direction]
Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Ralston and the amendment to the amendment of Mr. Lucas.
Mr. W. A. BEYNON (Moose Jaw):: Mr. Speaker, Canada's economic life has been the theme of a great many speeches delivered by hon. members sitting to your left. A number of those speakers have dealt only with the situation as we find it in Canada, and have made no reference to world conditions. Others have dealt fully and freely with the fact that the present condition exists throughout the world as well as in our own country. Those who have confined themselves to Canada have done so, apparently, because they wish to fix upon the government of the day the responsibility for that condition. They have sought to show that the policies adopted by this government are responsible for that condition. Those who have taken a wider view, and have considered the matter from a worldwide standpoint, have sought to lay the responsibility for present conditions upon the currency and credit system of the world, and finally to blame the government for not having remodelled the Canadian credit and currency system.
That represents fairly well the two schools of thought in the House of Commons. There are others who have gone further and said that the whole social order will have to be changed. Others, again, direct their criticism only against the capitalistic system. One hon. member opposite said that capitalism is on trial to-day. The hon. member for North Bruce (Mr. Malcolm) took a broader viewpoint when he stated that it is not only capitalism but democracy which is on trial. If that view be correct-and I think it is- then not only is democracy on trial, but the very institutions of government founded under the democratic system are on trial. It has often occurred to me that this House of Commons, of which we form a part, is on trial to-day as it has never been before. It stands on trial before the bar of public opinion. There are in Canada a number of people who are criticizing freely the manner in which this house approaches the country's business. They are saying that we do not act in a businesslike manner. They are saying that the opposition, whether it be Liberal or otherwise, is concerned not so much with finding out whether legislation is good or bad as with fixing responsibility for the legislation, and making political capital out of it. They even go so far as to say that when any legislation, good or bad, is brought down by the govern-

ment, the opposition, Liberal or otherwise, will attempt to make it appear bad. Even if the legislation is bad these people charge that the opposition is not so much concerned with making it good as with making capital out of it.
We know that in times like these, of stress and strain, people are more disposed to be critical of governments and institutions than they are in normal times. If the criticisms are unjustified and unwarranted, we have little to fear. On the other hand if in our institutions and the manner in which we approach the business of our country there is room for criticism, there rests upon the shoulders of every hon. member a heavy responsibility. All hon. members, Mr. Speaker, whether they sit to your left or to your right should feel that the good name of this house of parliament is their first concern. It is from this viewpoint that I purpose reviewing for a few moments some incidents that have occurred in this house since I came here, and some speeches that have been made.
Before going any further I admit quite freely that any parity when in opposition is much more prone to be 'captious than when, charged with the responsibilities of government. That, however, does nio:t relieve the opposition, whether it be Liberal or any other party, from reasonable restraint. The fact is that the people are looking to the members of this house to deal with the business of the country in a businesslike way, in a manner free from political partisanship. With that thought in mind I wish to refer to some remarks made by the hon. member for Willow Bunch (Mr. Donnelly), particularly his reference to the administration of relief in the province of Saskatchewan. I refer now to his remarks as reported at pages 3243-44 of Hansard:
. . . during the first two years of such administration we saw men running up and down the country handling relief and drawing salaries equal to what they were handing out in the way of relief for groceries.
Then I find he is quoted again at page 2096 as follows:
There are now no relief officers running about the country in high-powered cars. Last year they were driving from one town to the other, smoking big cigars, burning gas up at the rate of $150 to $200 a month, doing nothing but just going from town to town and drawing as much money themselves as they were handing out in relief.
If these accusations are correct, if that is the way relief is being administered by the relief commission in the province of Saskatchewan, the people of Canada ought to

The Budget-Mr. Beynon
know it. On the other hand, if the statements I have just read are incorrect, they do a great injustice to .the province of Saskatchewan and create a very wrong impression in the minds of the people of the rest of Canada. Therefore I want to deal for a little while with the administration of relief in that province by the relief commission.
The Saskatchewan relief commission was operating in 220 municipalities, over an area comprising 105,000 square miles. There was a relief officer in each municipality. To supervise these relief officers there were eleven supervisors. I leave it to any member of this house to say whether eleven supervisors would be too many to supervise 220 relief officers. The average salary of these relief officers was $76 per month; the average expense bill was $S0 per month. The average salary of the supervisors was $100 per month and their average expense amounted to $153 per month. I ask you, Mr. Speaker, and through you the members of this house, if the hon. member for Willow Bunch fairly represented the work of these supervisors when he referred to them as running about the country in high-powered cars, smoking big cigars and burning up gasoline at the rate of $150 to $200 a month, when their salary was $100 a month and their average expense bill $153.
That commission administered in that time a fund of over $17,000,000. I want to tell you something else that is unique about that commission. It is generally accepted that when any institution is functioning under a government there will be a great deal of graft in connection with it, or in any event there will not be any saving. Let me tell you what happened in connection with this commission. They handled gasoline, fuel oil, machinery repairs, fuel and seed grain. On, one item alone, that of kerosene for the tractors of the farmers, they made a saving of 2 cents a gallon, amounting to $77,000. It is unique in the history of this country that any institution functioning under a government should drive a hard bargain in buying supplies. Similar savings were made on all the commodities purchased by the commission, with the result that they saved on the total purchases an average of 33j per cent. In all they saved to the Dominion of Canada $422,085.23, the benefit of which went to the people who received the relief. That means a saving of nearly half a million dollars to the people of Canada, accomplished by the relief commission of the province of Saskatchewan driving hard bargains with the people from whom they purchased. It amounted to more than 53719-249
the total cost of administration of relief in Saskatchewan. I wonder if the hon. member for Willow Bunch realizes how difficult he is making it for this administration to get the people of the rest of Canada to vote relief for the province of Saskatchewan when he is creating such an erroneous impression about that relief commission.
It is unfortunate that there are those in this country who try to stir up strife between eastern and western Canada. There are people in western Canada, including a certain section of the press in the west who are always trying to stir up strife between the two parts of Canada. They tell us we have tariffs to suit eastern Canada-a certain section of the press dwells upon that at all times. Then there are those who say that the west has to be fed by the east, and that the west would be no good if it were not for the east. Then some in the west come back and say that the east could not exist without the west. I say, Mr. Speaker, that we have purchased from eastern Canada their machinery and the products of their factories, and we have borrowed their money to develop western Canada. But we purchased their goods and machinery because we could purchase them here better than we could elsewhere, and we borrowed their money because we could borrow' it better here than elsewhere. They sold us their machinery and their goods because we were the best market they had, and they sent us their money because we paid interest on it. It is nothing more or less than a satisfactory business arrangement between the two parts of Canada, and the east owes the west nothing and the west owes the east nothing for it. As a matter of fact we are working together on a business proposition to develop a good and substantial country; and all this puerile, trivial talk about the west depending on the east or the east depending on the west is a most pernicious thing in a country which we are trying to unify and consolidate and build up.
I wish to deal with another statement made by the hon. member for Willow Bunch. In the working out of this relief tlhe Saskatchewan relief commission, in order to have uniformity in distribution, provided that all applicants should sign an order; certain goods are stipulated and none but those goods could be delivered on that order. The hon. member for Willow Bundh says that the merchants in his constituency did not fill out those orders according to instructions, that they gave the recipients any goods they wanted so long as they totalled the amount stated in the order. These orders of course were approved and certified by the relief officers and by the mer-

The Budget-Mr. Beynon

chants as well as by the recipients of the relief. First the relief officer stated what goods should be delivered, then the merchant certified that those goods were the precise goods he did deliver, and the recipient certified that those were the precise goods he got. If the orders were filled with other goods, or if the recipient was given cash, then both the merchant and the recipient were guilty of fraud and of obtaining goods or money under false pretences. The hon. member for Willow Bunch says that he has inquired of hundreds of merchants in his constituency and that none of them filled out the orders as they were required to do but that they gave false certificates. Therefore it follows that the recipients of relief also must have given false certificates. This simply means that there is not an honest merchant or an honest recipient of relief in the whole of the constituency of Willow Bunch. I do not believe this, Mr. Speaker. I believe the hon. member for Willow Bunch has maligned his constituents and that what he said with respect to them is not true.
The hon. member also referred to the fact that the Prime Minister had stated that notes were taken for this relief because the people of western Canada had sent in telegrams stating that they did not want charity, that they wanted the right to pay back the amount of this relief. Then he said:
When I was in western Canada, on every platform I stood, I asked that those who had sent telegrams should stand up, but have never yet seen anyone do so. I believe they were afraid to stand up in case they might be lynched.
What does that mean? It simply means that if what the hon. member said is true the people in his constituency are not like the rest of the people in western Canada; they are prepared to be objects of the charity of this government rather than stand on their own feet and pay their own way. It means that if a man stands up in the constituency of Willow Bunch and says he does not want to be an object of charity he is liable to be lynched. I do not believe that. I know the people of Willow Bunch; I have done a good deal of business with them, and I believe they are good, average types of Canadian citizens. From what I know of them I am quite satisfied that in this statement also the hon. member has maligned his constituents. I do not believe they entered into this conspiracy to defraud; I do not believe they are prepared to take charity rather than pay their own way, and I seek to rescue the reputation of

those people from the aspersions which have been cast upon them by their representative in this house.
I should like to make one further reference to the remarks of the hon. member for Willow Bunch this afternoon. Dealing with the budget he spoke of this government instructing Mr. McFarland to indulge in gambling on the Winnipeg grain exchange. The hon. member said that Mr. MlcFarland was put in there to sell the carry-over that was held by the pool, and that instead of doing so he bought wheat futures, or in other words did not do what the government placed him there to do. I do not know whether the hon. member knew what he was talking about; I do not know whether he understood the problem Mr. McFarland had to solve. The fact is simply this, that Mr. McFarland was given the task of disposing of that large carry-over held by the pool. How could he do it? He had to sell that grain and no one would buy it unless he could sell futures against his purchases. Mr. McFarland had to buy those futures in order to make that transaction possible. In other words, in buying those futures he was doing the very thing the government placed him there to do; he was selling the grain. The hon. member for Willow Bunch said that was gambling, and that Mr. McFarland and the government should not have indulged in this practice. I am not going into the question of the moral right or wrong of dealing in futures; that is not the question. The fact is that this is the system of handling grain in this country at the present time; there is no other system. Mr. McFarland did not have the time or the means to step in and change the whole marketing system of the world in order to dispose of that surplus. He could dispose of it only in one way and, that was through the ordinary channels of trade and the ordinary means at his disposal. He used those means, and he did so legitimately. If they are wrong that is something that- will have to be considered, though a royal commission appointed by this government has decided that this system is necessary and is the best that has so far been devised. That being so I think the hon. member, when he made those statements to-day. should have known that he was giving an entirely wrong impression to the people of this country when he tried to give them to understand that Mr. McFarland was deliberately gambling in futures for the purpose of making up something he thought this country had lost.
I have referred to these matters, Mr. Speaker, as I stated in my opening remarks,

The Budget-Mr. Bey non
because I believe that the people of Canada expect the members of this house to approach the business of the country from a business standpoint instead of waging political battles on the floor of the house. Such statements as those made by the hon. member in the speeches to which I have referred do not tend to establish confidence in our institutions of government but rather cause people ito lose faith in those institutions. I believe such statements are responsible for a good deal of the discontent and unrest that we have in Canada to-day.
Now I should like to refer briefly to one or two matters dealt with by the hon. member for Shelburne-Yarmouth (Mr. Ralston) in his speech on the budget. I always have had a good deal of admiration for the hon. member, but I must say that some of his remarks rather surprised and disappointed me. I should like to say a word with regard to his reference to the amount placed in the estimates for the radio commission. At page 3372 of Hansard he is reported ae having said:
Now let me mention one or two other matters that are in the minds of the people, though hon. gentlemen opposite may say they are minor matters. I imagine there were very few people in this country, when they saw the contents of this budget, with the taxes which are being imposed and the lack of any real reduction in expenditure, who did not immediately think of the radio commission, for which we are being asked to vote $1,000,000 at a time like this.
I should like to direct attention to this, Mr. Speaker: First of all the hon. member mentioned high taxation and then referred to this amount being placed in the estimates at a time like this. Apparently he desired to leave in the minds of the people the idea that these taxes were being levied in order to raise this amount for the radio commission. The hon. member knows, or ought to know, that this money has been collected in radio licence fees. I have inquired from the government and I find that the Department of Marine has collected about $1,500,000 through the sale of radio licences. Last year we appointed a committee of this house to consider the question of radio broadcasting and to bring in a report. That report was unanimous, and was signed by every member of the committee; I think it passed through this house with greater unanimity than has been shown in regard to any report presented since I have been here. I do not think one dissenting voice was raised. If any hon. member is interested the report appears at page 2710 of Hansard for last session. Recom-
53719-249 J
mendation (d) contained in that report was as follows:
That all revenues obtained from licence fees, sale of advertisement and other revenues accessory to the business of broadcasting be used by the commission in the interests of radio.
The act also provides that these licence fees shall be paid into the consolidated revenue fund. True there is no way of identifying that money, but there is a recommendation in the report providing that these fees shall be used by the commission in the interests of radio. If that is wrong, then the hon. member for Shelburne-Yarmouth is just as responsible as any member on this side. Indeed, every hon. member who sits opposite is equally responsible with those on this side of the house because it was the most nearly unanimous vote we have had in this house in a long time.


Edward James Young: No; it was not unanimous.


William Addison Beynon: Probably there was one objection; I did not know the hon. member was present on that occasion. Apart from him, however, it was the most nearly unanimous vote we have ever had in this house, and yet the hon. member for Shelburne-Yarmouth tries to leave with the people the impression that this government is taxing them for the purpose of voting $1,000,000 to the radio commission. What does that mean? How can we expect the people to have confidence in the institutions of government if an hon. member who has been a minister of the crown is going to stand up in this house and, at least by his conduct or his silence, endorse what the government does to-day, and then try to escape responsibility for it to-morrow? That is precisely what the hon. member was doing.
I refer now to another remark made by the hon. member for She'lburne-Yarmouth. lie said to the Minister of Finance: What did the government of Great Britajn do when they found that their revenues would not meet expenditures? Why, they reduced expenditures; they economized. Now, that seems a very, very reasonable thing to do, but I would point out that in all the time since I have been in this house I have not known one retraction in expenditures proposed by this government which has not been opposed by the official opposition-not one. It might be that in some of its proposals of reduction in expenditures the government would be wrong, but it is inconceivable that in all these proposals it can be wrong. Surely it must have been right sometimes; yet we find the opposition, so far as I can remember at any
The Budget-Mr. Beynon

rate, opposing practically every proposed retraction in expenditures, and when they come to deal with the budget they turn around and ask, "Why doesn't the government economize?"
The hon. member also made some references to the tariff. Hon. gentlemen opposite are very keen about the tariff; this is thedr pet subject. My hon. friend referred to a statement made by Sir John Aird, as reported at page 3379 of Hansard. Sir John Aird is quoted as speaking of the recognition in several quarters that extreme protection had proved a boomerang, and he used the phrase nationalistic mania, a phrase which the hon. gentleman commended to the attention of the Prime Minister. And he says that he thinks that on this occasion Sir John Aird must have had in mind the dumping duties applied by this government. He tries to leave with the people the impression that the strangulation of Canada's trade is attributable to the duties imposed by this government. It happens, however, that there are those who do not take the same view. Let me quote now, not from a Conservative, not from a friend of this government, but from the leader of liberalism in the province of Saskatchewan. I have before me the report of a speech delivered by the Hon. James G. Gardiner, the present leader of the Liberal opposition in Saskatchewan and ex-premier of the province, and this is What he said in Grand Coulee in March last:
Canada vias suffering to-day, said Mr. Gardiner, because of the high tariffs imposed on Canadian exportable foodstuffs by European countries. These tariffs had been placed against Canadian goods, not because ot antagonism to Canada, but as an inducement to the people of the European countries to produce more food. These tariffs will remain
How long? So long as the dumping duties remain? No; that is not what Mr. Gardiner says.
These tariffs will remain just so long as those countries believe there is an immediate danger of war, and foodstuffs within their own boundaries are required.
That comes from a leader of liberalism in Saskatchewan; he has placed the tariff problem where it belongs in relation to the strangulation of trade. It belongs to those countries which have placed their tariffs against our goods, due not, as he points out, to antagonism to this country, or to the desire to retaliate, but to the fact that they have a problem of their own to solve.
The hon. member for Shelburne-Yarmouth knows as well as anyone else does that the tariffs placed by this government have been 
placed for the purpose of saving this country, for the purpose of saving the industrial and financial fabric of the country; and he knows as well as anyone else does that it would spell blue ruin to Canada if these tariffs were taken off. I believe that the leader of this government is more in favour of low tariffs than the leader of the official opposition, and I think he has done more to bring about a proper adjustment of world tariffs than any leader of any government we have had in Canada, and this not by throwing down our tariff barriers but by putting them up so that others might see that they could not exploit this country while keeping up their own tariff walls. That is why we now have some prospect of entering into a trade agreement with the United States.
Mr. D'ARCY B. PLUNKETT (Victoria) : I am sure that every hon. member of this house realizes, as every member of any legislative body anywhere in the world must admit, that the ways of ministers of finance are not easy in these times. It is therefore a pleasure for me to-night to congratulate the Minister of Finance (Mr. Rhodes) on the very able budget he has brought down and the manner in which it was presented, and to assure him of the great expectations we have with respect to it.
With the indulgence of the house I purpose to-night to refer to some aspects of the late empire economic conference and the treaty arrived at. I did not speak last fall nor have I spoken during the present session, and I trust therefore that the house will forgive me for bringing this matter up at this late date. When I look back upon that treaty and think of the great Liberal party of Canada, and when I see how it has denied its own views in opposing the consummation of that treaty, I sometimes wonder where hon. gentlemen opposite find the strength to maintain their position. In that connection I wish to read a statement made in 1930 by the Hon. Mr. Dunning, then Minister of Finance in the late Liberal government, when he brought down the budget that proposed the countervailing duties. We never hear anything about countervailing duties now; they are forgotten. In fact, I think the word is now counterfailing; it was a budget that passed over the counter but it was never accepted. Perhaps it was a remnant, but this is what Mr. Dunning said at that time:
But we believe that within the British community of nations lies the greatest measure of opportunity for mutual development of trade because of our common heritage, kindred institutions and a common patriotism.

The Budget-Mr. Plunkett
I am sure the house can grasp the meaning of those words which were endorsed by the party as an election appeal and then repudiated two yeans later in no mild way. This house had to suffer for six weeks listening to criticism which could have been made in three. We had to suffer and listen to the most rabid speeches. Finally they accepted the agreements and now they are claiming virtue. But that is nothing new as far as the Liberal party is concerned. As trade with Great Britain increases we may expect the Liberal party to take the stand that it was only criticism they were offering. They are turning now to their old friends the United States of America.


Edward James Young: We have lots of company.


D'Arcy Britton Plunkett: The Conservative party has always been ready to negotiate a treaty with the United States but it has not been ready to let a country raid our markets to the extent of nearly $900,000,000 in one year. I should like to quote what the hon. member for Vancouver Centre (Mr. Mackenzie) said with reference to British preference when seeking election in his own city. His statement was even worse than that of Mr. Dunning and it must be hard for his party to swallow. He used these words:
British preference will divert $200,000,000 of Canadian purchases to Great Britain from the United States. Great Britain will buy $300,000,000 of Canadian foodstuffs.
The hon. merfilber knew what business could be done with Great Britain and he knew also that that country was going off the gold standard. He continued:
British preference means that Canada will give Great Britain and other parts of the British empire the right to sell to us under more favourable terms than we offer foreign countries those commodities which we do not produce economically ourselves. In other words. Liberal policy is: We prefer to trade with the empire.
But listen te>
just how consistent the hon. member is when he speaks in this house. Last fall he said that the treaty was an attempt 'to set up an imperial economic unit, and he then described the whole treaty as an iniquitous agreement which had failed completely to deal with the question of exchange and empire content. Surely that was a right about face! But such a thing is not unusual with the Liberal party.
It has been stated by members of the Liberal party that a national unemployment commission or committee should have been appointed. Let us study this matter for a moment to see what is involved. How would
this commission be set up? Would we select one member from each province? Would it be a royal commission to travel up and down the country as they usually do inquiring into conditions existing in each province and realizing finally that the problems of one province were not those of another? It must be remembered that Ontario and Quebec are manufacturing and agricultural provinces; the three prairie provinces are grain producers while the lumbering business takes first place in British Columbia. Would a national committee be able to carry on this work as economically as committees set up by the provincial governments? These provincial commissions understand the conditions prevailing in their own provinces, and they do not interfere with local jurisdiction or provincial rights. These statements may sound fine when they are made but they are vastly different when they are analysed. I do not think anyone would expect a commissioner from Quebec or the maritime provinces to understand the problems of British Columbia. This would have been a costly enterprise.
It has been said also that the unemployed should be put to work on provincial and dominion public works. I have spoken with many contractors and they tell me that the difficulty is not in putting these men to work but in getting them to do some work. These men contend that the state owes them a living and many of them do not realize just what is the state. The state is the taxpayers of Canada, just as long as the people pay taxes and no longer. There is the idea abroad that certain taxpayers should keep others who are unemployed. We all regret the conditions that prevail but to my mind it would mean nothing less than bankruptcy to start out on the construction of costly public works. The difficulty is to get these people to believe that they have to work once more. This is one of the problems which we must contend with in unemployment relief.
Certain Liberal policies remind me of some handshakes I have received. There is the gesture of the proferred hand with no sincerity behind it, and so it is with some of their policies. Many of us have shaken hands with people who suddenly withdrew their hands as though they were hurting our feelings. Very often the Liberals bring out a policy and suddenly withdraw it, but such action has never hurt the feelings of the people of Canada. That party is now commencing an era of saving. It was refreshing the other night to hear the hon. member for West Middle^x
The Budget-Mr, Plunkett

(Mr. Elliott) and Quebec South (Mr. Power) criticizing the Minister of Public Works (Mr. Stewart) for spending too much. That was such an unusual occurrence that I decided to look up the record of the late Liberal government for the last ten years it was in power. I found that the Department of Public Works under the Liberal regime spent on an average of $23,000,000 per year, while the same department during three years of Conservative regime spent on an average of only 817,000,000 per year. I hope this saving will not be carried too far or it may mean that the wages of the charwomen which were advanced so handsomely just before the last elections will have to be reduced.
I often regret that the senior member for Ottawa (Mr. Chevrier) does not make up his mind to speak on something else than the civil service. I have no doubt that if he did so he would make a splendid speech. He seems to have the idea that the only place in Canada where there is a civil service is in Ottawa; he forgets that there are just as loyal civil servants right across Canada. These civil servants have taken the ten per cent cut just the same as those in Ottawa. He seems to forget that it is taxpayers who are paying the salaries of these civil servants, and there are many taxpayers who have never seen a civil servant. The hon. members for Ottawa have great ability and I am sure it would prove to be refreshing if they would speak upon some other subject than the civil service. Civil servants across Canada have asked me: "Are the civil servants in Ottawa any better than we are? The members for Ottawa speak oftener for the civil service than does the member from my constituency." I find it hard to answer such a question. I feel that the civil servants are just as loyal in one part of Canada as in another.
Speaking of bank failures, we should be gratified at and proud of the situation in Canada. Bank failures in the United States during recent years have amounted to 9,366, involving deposits of $4,271,000,000, ending finally with temporary suspension of all banks including the federal reserve system. In Canada there have been no bank failures since 1923, and not one depositor has lost a dollar through bank failures in this country since that year.
The proposal of the government to appoint a royal commission to study our banking and monetary system and to make recommendations is excellent, but I believe this commission should have wider powers of inquiry or jurisdiction and that authority should be 
given to it to inquire into and report upon the conduct of all stock exchange transactions. It may not be logical to combine these two commissions, but there is throughout Canada to-day more regret, discontent and unrest in regard to future business transactions and the stock exchanges than there has ever been before in our history. It seems to be a racketeering job in Canada for promoters to get hold of some well established old firm, where perhaps the man who made the business has passed away and the younger generation is not so much concerned with the good name of the business that was built as with the money they can get out of it. So they are approached by these promoters, and on the name of that very old firm and its reputation, people buy those stocks after they have been watered to the depths. Then the banks ask for their interest and the firm is unable to pay it. There must come a time when stock exchanges will have to be examined and we shall have to provide regulations to control the issuance of stock beyond a certain degree or margin of safety for investors, or, in other words, curtailment or control of watered stock operations by high pressure salesmen or promoters. When that is done, I believe it will be of more value than anything else in bringing confidence back to the nation. I know many old firms that have been closed up and incorporated into other companies. Such firms were of great service to the country at the time. Small shoppers could get extended credit from them. To-day if you go into any incorporated company which has become a large concern and do not pay in thirty days, they close you out. But the old responsible firm which carried these people, which extended their credit for the time being, did not have watered stock; that was the difference. The next purposeful step this government takes should be to appoint a commission to inquire into stock exchange transactions and to stop promoters and high pressure salesmen from flooding the market with watered stock.
Speaking of the new party, the Cooperative Commonwealth Federation-and I am not going to join them up with Russia; I do not want any of them for a moment to think that; I do not believe they have quite reached that depth in the mire-I have never been able to understand what they mean by planned economy. Let us look at this nation, its infancy and how it has grown. Could we have accomplished what we have if we had not had some system of planned economy? Another statement which my hon. friends often make is: "The capitalistic system has failed." There is some excuse for its slipping once after the

The Budget-Mr. Plunkett
many years through which it has carried us, after the great nation it has built here, after constructing, as it has, transportation systems across this country. Are we going to condemn all those things because we have been brought back to the light, to frugality and a better mode of living? [DOT] Are we to give up all the things we have won-our social and labour legislation, hospitalization, mothers' pensions, mothers' allowances, old men's homes? Is that the product of a backward nation and a system that has failed? I think not. Are we to condemn it because for four or five years we have travail and hard labour? Perhaps we need this; we may not have been working along the right line.
My hon. friends speak of an increase in commodity prices. We all wish for that. It is easy to make statements and to express wishes in a general way, but it is quite another thing when we try to work them out in applying them. No inference or indication has yet been given by the Cooperative Commonwealth Federation party that they have evolved a system, that they have got down to facts and can advise us of any definite arrangements they are making for the government of the country. The suggestion was made by the hon. member for Southeast Grey (Miss Mac-phail) that we should confiscate all incomes over S20,000 a year. That is a different matter. I do not know whether the people will accept it or not. My hon. friends, however, have been insistent in quoting to us views of professors on economics. The other day I came across something which I am going to read for the benefit of members of the C.C.F. party and any others to whom it may apply, who may have extreme ideas and wish to change the whole system. This is a statement made by G. D. H. Cole, reader in economics in the University of Oxford and member of the Economic Advisory Council, in a book recently written by him:
Indeed there are some people who go so far as to attribute almost all our economic difficulties to the misuse of money, and hold that everything can be put right by a change in monetary policy without making any fundamental alteration in the other aspects of economic organization. These are "currency cranks" whose doctrines have at all times of economic distress exercised an extraordinary fascination over men's minds, so that whenever anything goes wrong with the industrial system it is safe to predict that a fresh batch of infallible plans for restoring prosperity by the manipulation of money will promptly make its appearance . . . For it is so faJtally easy to go stark staring miad in thinking and talking about money, and those whom the madness grips appear to become fatally incapable of talking sense on any subject.
That is from a professor and I believe it will have great effect with the members of the C.C.F. party, for we have had to suffer in this house quotations from so many professors, it is a relief to find one a little bit different from those who so far have been quoted to us.
I wish to speak for just a moment on one or two points of the Liberal platform. Let me take the first:
To deal with unemployment "through a representative national commission which would cooperate with the provinces and municipalities."
Are we not doing that now at less cost to the dominion than as proposed by them?
As a permanent measure, the party was pledged "to institute policies which will serve to provide employment by reviving industry and trade and the institution of a national system of unemployment insurance.
When the Liberal party were in power, they did not establish a national system of unemployment insurance, although they had the opportunity.
Another of their points is:
To promote "trade with all nations-"
This is really laughable.
"-and negotiate trade agreements with any countries willing to trade with Canada On a reciprocal basis."
I do not think there would be any objection to this government doing that; it is what this party is anxious to do at all times. That is another great platform and not new. But the last one, the fourteenth, is a gem:
Overhauling of the costs of government, federal, provincial and municipal.
Yet we have the leader of the opposition (Mr. Mackenzie King) continuously telling us not to interfere with the provinces; if you do that, it is unconstitutional. Nevertheless he would control their finances, run their governments notwithstanding this great constitutional fetish which he carries about with him.
What reason have we to be discouraged? I speak particularly to the western members. It is peculiar to note that due to the blinding partisanship of hon. members from Vancouver and other parts of British Columbia they can see nothing good in their native province. If one were to listen to what some hon. members from British Columbia have to say, he would almost imagine that that province is on the road to oblivion. In that connection I shall quote from that great Vancouver paper. The Sun:
Vancouver's trade greatest in four years, tour hundred shiploads of grain alone. General export has big improvement.
The Budget-Mr. Plunkett

Here is where Vancouver begins to get a little bit jealous. Vancouver has never been noted for generosity, so they say.
Total exports apart from grain experienced a decline of 150,000 tons from 1931.
New Westminster gets benefit. To some extent this loss was only nominal. The port growth of New Westminster, which in 1932 reached heights never before attained, has been made to a degree at Vancouver's expense. Some commodities, like metal and fruit, which formerly moved mostly through Vancouver, now go out chiefly through Vancouver's companion port on the Fraser.
If you interfere with the trade of Vancouver, or get a greater share of the trade than she does, you will be called a chum; or -pal; that is the way they figure. Hon. members from British Columbia never tell any of these facts. So far as they are concerned one would be led to believe there is nothing but destitution on the Pacific coast.
Then in The Sun of another date we find the following:
Vancouver's vast foreign trade; 80 shi-ps at sea with British Columbia goods. Colourful port activity hardly equalled in world centres.
The article continues:
The shipping season is at the peak of its seasonal rise. Thousands of tons of Canada's products are moving daily to a hundred different lands. The harbour throbs with steamships, motorships, towboats, gasboats ... On one day last week 25 deep sea carriers, representing seven different maritime nations were in Vancouver harbour at the same time . . . As many as 17 ships to take grain were in port together on one day last week and not five minutes delay was recorded by them according to harbour board officials.
There are capital investments coming into Canada. Many United States firms have built branch industrial and commercial houses in this country, and have been spending money here. Our trade with Great Britain has increased, and the prices received for our agricultural products compare favourably with those obtaining in any other part of the world. Our Canadian citizens are coming home. This year four Canadian families about which I know returned to Victoria in my province.
When we consider all these factors we should not persist in carping criticism and political partisanship, but should accept the difficulties and try to meet them. If the Liberal party feel they should be in power there may come a time when they will have an opportunity to criticize the present government, but when we are going through these difficult times they are not acting properly or from the national point of view when they try to influence the faith of our people in Canadian institutions.


Mr. J. H. STITT (Selkirk):: Mr. Speaker,
I hope the house will bear with me as I speak in the closing stages of the debate. First I should like to congratulate the Minister of Finance (Mr. Rhodes) upon the very able manner in which he presented the budget. I congratulate him further upon his imagination and upon the spirit of progress reflected in his utterances. I believe however that the budget is not one upon which I can altogether congratulate the government. I make bold enough to offer a few comments, particularly with regard to one phase of the speech, because I believe I have peculiar qualifications for knowing something about the returned soldier problem.
I believe I am the only member of the house who has been a pensioner, a returned soldier and at one time a civil servant. In 1920 I was chairman of the committee of the Great War Veterans' Association of Ottawa when it went before the government concerning pension legislation. On that occasion the one principle which we espoused, and which the government accepted, was that no matter how much a returned soldier was given by way of pension; that pension would never be taken into consideration by industry in fixing his emolument. I believe that principle is enshrined in the Pension Act.
We are passing through very difficult times, when the very fabric of the state is in danger, when industry has collapsed, when unemployment is rife, and when all Canadians have to be called upon to make sacrifices. I believe the veterans will not be the last to make any sacrifice which may be necessary in the interests of Canada. I should like to direct my remarks particularly to that part of the budget speech of the Finance Minister which I quote as fallows:
In this connection, I may say that with respect to pensioners who are in the employ of the government and who are paid the salary of the position, -action will be taken whereby the payment of pension will be suspended during -the period of such employment.
What did these men who are in the preferred position of pensioners in the civil service really get out of the war? True, they got a job. They received that position through the Civil Service Commission, and they have their pensions. I believe the Association of United Veterans have appeared before the Minister of Finance and the cabinet and have laid down the principle of equality of sacrifice. They are willing to make a sacrifice, if necessary, but they are asking that other Canadians make an equal sacrifice. I notice that

The Budget-Mr. Stitt (Selkirk)
on the memorandum submitted to the government the name of Mr. Ed. Baker of the Sir Arthur Pearson Club for Blinded Soldiers and Sailors appears. In this year 1933, so many years after the war, I wonder if the government -this government that I support, this government that has always stood behind the empire, this government that has brought about mter-imperial treaties-I wonder if they really realize just what sacrifices some of these men made. All they have to do is to look into the glassy eyes of Ed. Baker-that is all they have to do. If any man can stand up in this house and say that the armless veterans represented by Reg. Bowler, who no doubt was before the government; that the legless veterans represented by Sj'dney Lambert, that the blind veterans represented by Ed. Baker, have really not put to the government a fail-case when they ask for equality of sacrifice, then I say that the government is lacking in imagination, which I do not believe they are. I do not believe they can have truly estimated just what this provision in the budget means.


Some hon. MEMBERS:: Hear, hear.


James Herbert Stitt: Mr. Speaker, there were two classes of men who gave service to the country during the war; the men who gave their money, and the men who gave their bodies, their blood, and their lives. You entered into a contract with the men who gave their money to carry on the war-we have heard a great deal about the sanctity of contracts, and in order to preserve our credit position as a nation in the international money markets it is necessary for us never to entertain for a moment the idea of the repudiation of contracts. But I say that a contract was made with the veterans of this country; this nation gave its covenant to them by statute even as to the bondholders it gave a contract in writing. To me, Mr. Speaker, it is a very strange situation, it is something I never expected, it is beyond any flight of my imagination, that a Conservative government, a government of men who love the empire, can dishonour a contract made with the true sons of the empire, when that contract was signed and sealed with their blood. Mr. Speaker, I am going to ask the Finance minister or some member of the government to give some statement before the vote is called on this matter. I am going to suggest that this is not the time when this matter regarding civil servants' pensions should be considered. There is going to be a measure presented to this house in a few days with regard to returned soldiers' pensions. It is in connection with that that this question ought to be decided; it should not be included in the budget. I am going to be bold enough to ask the government if they will not withdraw this proposal from the budget w-hen we come to vote on it this evening.


Some hon. MEMBERS:: Hear, hear.


James Herbert Stitt: 
Mr. W. W. KENNEDY (Winnipeg South Centre):: Mr. Speaker, I know it is the desire of the house to take the vote on the budget before eleven o'clock to-night; it is now half past ten, therefore I will take only a very few minutes. I am going to resist the temptation to discuss a number of matters; I will devote my remarks to one subject alone, in the hope that by so doing I can perhaps place special emphasis on that subject. I refer to that portion of the budget address concerning which the hon. member for Selkirk (Mr. Stitt), who has just taken his seat, spoke so eloquently. His words, the manner of his speaking, the clarity and the simplicity of his statement, have rendered the task I propose to undertake very simple indeed, and I am enabled very considerably to shorten my remarks. For that I am indeed grateful to my colleague from Selkirk.
The hon. member read the statement in the budget referring to the intention of the government to interfere, if I may use that word, with the pensions received by ex-service men in the civil service. Perhaps it would be well if, beside the statement read by the hon. member from the budget speech delivered by the Minister of Finance (Mr. Rhodes) on March 21, I placed the explanation given by the minister three days later. I will read that explanation to the house. Speaking on March 24 the Minister of Finance said:
Perhaps in this connection, howrever, I might be permitted to say one word, as there would appear to be some considerable misapprehension with regard to what is in the mind of the government in respect to pensions. The last thing in the world that we had in mind was any interference with the sanctity of the contract concerning pensions. Whatever merit there may or may not be attached to the suggestions contained in the budget speech with respect to pensions, it was never intended to interfere with pensions as such. Perhaps I should also add for the information of the house that this morning we had a long conference with the heads of the various veteran organizations. That conference is to be renewed, and at its conclusion an announcement of a specific character will be made to the house.
I further understand from the Minister of Finance that arrangements have been made for another conference on Wednesday next
with the representatives of the various soldier organizations in this country as well as some fifty others gathered from all parts of Canada, in the hope of meeting the views of the veterans generally as expressed through their organizations. Just here I should like to say -and I speak with knowledge-that the representatives of the ex-service men have been pleased indeed with the interviews they have had already with the Prime Minister (Mr. Bennett) and the Minister of Finance. They have spoken very warmly indeed of the manner in which their views were received. I think the veterans generally throughout Canada, as well as all Canadians, should be proud to have such fair and competent men as leaders of their organizations. In dealing with this matter-which, when it was first broached, came as a shock to the pensioners generally-they did not rush into print at once; they took the good Anglo-Saxon method of meeting and reasoning together, and it is my confident belief, from the assurances I have had from the Minister of Finance, that an adjustment will be worked out to the satisfaction of all concerned.
I am not going into details with regard to the rights of pensioners under the Civil Service Act, except to say this. By virtue of the provisions of that act preference is given, first, to ex-service men suffering from disability in regard to governmental employment, and in receipt of pension and secondly, to ex-service men not in receipt of pensions. By virtue of these provisions of the act quite a number of pensioners have found their way into government departments in employment, in a measure, sheltered. The suggestion in the budget has to do with that class and that class alone.
It appears to me that behind the suggestion contained in the budget there must have been this theory, that a pensioner who was suffering a disability, so found by the Board of Pension Commissioners, and awarded a pension should be considered by that award to have had his disability removed in so far as competition in civil life was concerned. In other words, the proposal must have been premised on this: If I am an ex-service man disabled and the board assesses my disability at thirty per cent and gives me a thirty per cent pension, then it must have been assumed, I take it, that that thirty per cent pension would put me on a competitive basis with another ex-service man who was not entitled to pension. Well, it may do so on paper, but it does not in fact, and that is one point I wish to try to impress upon this
3950	COMMONS
The Budget-Mr. Kennedy (Winnipeg)
house to-night. I think I can do it best by illustration.
I do not wish to harrow the house with scenes and tales of service; I wish to state only facts and in such plain and simple language as I can command. I will not indulge in exaggeration or hyperbole. The facts are these-I will give one instance. On the eve of October 26, 1917, a wet, miserable, rotten night in Flanders, sleet and mud and mire, a wilderness, where shell fire served only to make darkness visible, there went up to Passchendaele the Canadian corps. They moved up through mud and shelling and for two days and two nights they lay in open fields without trenches, ready to go over. They had no sleep that could be called sleep. Not one hour of that time were they dry or warm, but always cold, shivering and miserable. But they were representatives of Canada. On the eve of October 26 they were in the jumping-off position. I will speak of a regiment in what was known as the first wave of attack on the morning of October 26, the forty-sixth battalion of infantry of Saskatchewan, of which hon. members from that province should be proud. At five-thirty in the morning they went over the top and took all objectives, but they were decimated. They fought off three separate counter-attacks that afternoon. They were relieved at midnight. How many came out? I speak of my own knowledge for two left companies of that battalion. Of half the regiment there came out that night one officer, one lance corporal and forty-three other ranks, Thesei were all the men that returned, having been through that experience from five-thirty in the morning until midnight. W'hat about the rest? Many never came out, but a fair percentage did. They were walking wounded and stretcher cases and at night, after the regiment was relieved, searching parties, directed only by the cries of the wounded men, located them and carried them out. These men found their way back to Canada. Some of them are still in the hospitals, though sixteen years have passed. Some of them are walking our streets crippled, and some 'have found their way into the service of the government of Canada. It is of these that I speak to-night. These are the ones, men of that regiment and of like regiments, who will be affected by this legislation if it goes through.
Let us take a specific case. There is one who stands at the door of this chamber. He receives a pension of thirty per cent-stomach muscles torn away, with a plate in. A government job, it is true, a government job, standing at the door of this chamber. But why this 
job? Because that disability makes it impossible for him to go out and take his place in the competitive life of the country where he might obtain anything like the job, if one were going, which he would be capable of filling. He gets $30 a month pension and takes the only job he can fill, one that requires no manual work-a light job and light pay. Add his light pay to his thirty per cent pension. Is he put on the same basis as the man without war disability who can fight his way through life? Not by any manner of means.
If this forecast legislation went through it would mean that that man would have deducted from the salary that goes with his position the $30 per month pension. Does Canada want to do that? Does she need to do it yet? And to the eternal credit of these men filling these positions to-day, let it be said that the country has hardly heard a chirp out of them. I will tell you why. They do not believe that this government will do such a thing, nor do I believe it in view of the explanation given by the minister. Sacrifices must be made, it is true. I believe the hon. member for Selkirk was right. In fact, the officials of the soldiers' organizations have suggested, according to the press, that if it be necessary for pensioners to give something from their pensions to help out Canada in her hour of need, they will do so, as they gave their bodies and their ideals on another occasion. I believe they would do it. But Canada is not in such desperate straits as that. I say to the government, so far as these men are concerned, let Canada wait a little longer.
It is still a great army, and I want to say .this in closing. The ex-service men of the great war, so far as the Canadian corps is concerned, have been treated more fairly, more generously, if I may use that term, than the soldiers of any other nation that fought in that war. That is a fact. Do not forget this, either, that the ex-service men of Canada appreciate the privileges and distinction they enjoy, and it is a distinction in which I think all Canadians should feel proud to share. I say, let Canada wait a little longer. It is still a great army, but the ranks are thinning, though not with shrapnel; for every day, almost every hour, death strikes. Each spring a little ceremony takes place across this country in our cemeteries, where the soldiers who still remain parade and play the Last Post and then the Reveille. The ranks are thinning. It is an army to whose ranks come no new recruits, but from whose ranks daily and hourly

The Budget-Division
men are being discharged by that great demobilization officer-death. I say to this house and to the government: if it be any advantage to disabled pensioners to have a little pension in addition to their government pay, let them enjoy it not only for their own sake but for the sake of their dependents. It must be remembered that the disabilities from which they suffer will be carried not by them alone, but by their children and their children's children unto the third and fourth generation.
I agree with the hon. member for Selkirk when he states that the budget is not the place to interfere with pensions. The Pension Act is to be amended at this session. If there is to be any change in pension rights that change should be made under the Pension Act. The preference given to these men is given under the Civil Service Act. If it is thought that too great a preference is given, if there are inequalities to be adjusted, they should be adjusted under that act.


Mr. HARRIS:: I was paired witih the hon. member for Cartier (Mr. Jacobs). Had I voted I would have voted against the amendment to the amendment.


Mr. SMOKE:: I was paired with the bon.
member for South Oxford (Mr. Cayley). Had I voted I would have voted against the amendment to the amendment.


Mr. MULLINS:: I was paired with the
hon. member for St. Boniface (Mr. Howden). Had I voted I would have voted against the amendment to the amendment.


Mr. SHORT:: I was paired with the
hon. member for Kenora-Ramy River (Mr. Heenam). Had I voted I would have voted against the amendment to the amendment.


Mr. DUGUAY (Trans.):: I was paired with the hon. member for Bagot (Mr. Dumaine). Had I voted I would have voted against the amendment to the amendment.
The bouse divided on the amendment (Mr.	
Ralston), which was negatived on the follow-	
mg division:	YEAS Messrs:
Beaubien,	Lacroix,
Bertrand,	Lapointe,
Blair,	Mackenzie
Bothwell,	(Vancouver Centre),
Bouchard,	MacLean,
Boulanger,	McIntosh,
Brasset,	McKenzie (Assiniboia),
Cardin,	McPhee,
Casgrain,	Mercier (Laurier-
Chevrier,	Outremont),
Denis,	Motherwell,
Desrockers,	Mur.n,
Donnelly,	Neill,
Dubois,	Parent,
Duff,	Pouliot,
Dupuis,	Ralston,
Elliott,	Raymond,
Fafard,	Reid,
Ferland,	Rheaume,
Fiset. Sir Eugene,	Roberge,
Fontaine,	Rutherford,
Fournier,	St-Pere,
Gershaw.	Seguin,
Girouard,	Stewart
Golding,	(Edmonton West),
Goulet,	Taylor,
Hall,	Thauvette,
Hanson (Skeena),	T otzke,
Hepburn,	Vallance,
Howard,	Veniot,
Hurtubise,	Verville,
Jean,	Weir (Macdonald),
King, Mackenzie,	Yroung.-63.
Anderson (Toronto-	NAYS Messrs: Barber,
High Park),	Baribeau,
Arsenault,	Barrette,
Arthurs,	Belec,
Baker,	Bell (St. Antoine),
	
Bell (St. John-Albert),	Maloney,
Bennett,	Manion,
Bourgeois,	Mitchell,
Bowen,	Moore (Chateauguay-
Bowman,	Huntingdon),
Boyes,	Morand,
Bury,	Murphy,
Cantley,	Myers,
Carmichael,	Peck,
Casselman,	Perley (Qu'Appelle),
Chaplin,	Pettit,
Charters,	Piekel,
Coote,	Plunkett,
Cotnam,	Porteous,
Cowan (Long Lake),	Price,
Davies,	Quinn,
Dickie,	Rhodes,
Dor ion,	Robinson,
Dupre, Duranleau,	Rogers,
	Ross,
Edwards,	Rowe,
Embury,	Ryckman,
E si ing,	Ryerson,
Fortin,	Sauve,
Fraser (Cariboo),	Shaver,
Gagnon,	Simpson
Garland (BowRiver),	(Simcoe North),
Garland (Carleton),	Simpson
Geary,	(Algoma West),
Gobeil,	Smith
Gordon,	(Yictoria-Carleton),
Gott,	Smith (Cumberland).
Guthrie,	Spankie,
Hanson	Speakman,
(York-Sunbury),	Spencer,
Hay,	Spotton,
Irvine, J ohnstone,	Sproule,
	Stanley,
Jones,	Stewart (Leeds),
Kennedy	Stewart (Lethbridge),
(Peace River),	Stinson,
Kennedy (Winnipeg	Stirling,
South Centre),	Stitt (Nelson),
Lafleehe,	Stitt (Selkirk),
Larue,	Sullivan,
Laurin,	Sutherland,
Lennox,	Swanston,
Lucas,	Tetreault,
Luchkovich,	Thompson
Macdougall,	(Simcoe East),
Maclnnis,	Thompson (Lanark),
MacLaren,	Tummon,
MacMillan	Turnbull,
(Saskatoon),	Weese,
MacNieol,	Weir (Melfort),
Macphail, Miss,	White (London),
McDade,	White (Mount Royal),
McGillis,	Wilson,
McGregor, McLure,	Wright.-119.
PAIRS	
(The list of pairs is furnished by the chief whips.)	
Messrs:	
Anderson (Halton),	Factor,
Beaubier,	Ahearn,
Bell (Hamilton),	Mercier (St. Henri),
Beynon,	Euler,
Black (Halifax),	Dubuc,
Burns,	Butcher,
Cahan,	R infret,
Cowan (Port Arthur),	Ilsley,
Duguay,	Dumaine,
Ernst,	Heaps,

The Budget-Division
Ganong,	II anbury,	
Hackett,	Perras,	
Harris,	J acobs,	
LaV ergne,	Deslauriers,	
Lawson,	Gray,	
MacDonald	Urquhart,	
(Cape Breton),		
Macdonald (Kingsl.	Gardiner,	
McGibbon,	Power,	
Matthews,	Moore (Ontario!.	
Mullins,	Howden,	
Nicholson,	Bradette,	
Perley, Sir George,	Marcil,	
Senn,	Sanderson,	
Short,	Heenan,	
Smoke,	Cayley,	
Spence,	Fraser (North-	
	umberland),	
Stevens,	Malcolm,	
Willis,	Brown.


Mr. SENN:: I was paired with the		hon.
member for South	Perth (Mr. Sanderson).	
Had I voted I would have voted against the		
amendment.


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


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


Mr. MURPHY:: I was paired with the hon. member for West Edmonton (Mr. Stewart). Had I voted I would have voted against the amendment.


Mr. HACKETT:: I was paired with the hon. member for Wright (Mr. Perras). Had I voted I would have voted against the amendment.


Harry Bernard Short: I was paired with the hon. member for Kenora-Rainy River (Mr. Heenan). Had I voted I would have voted against the amendment.


Franklin Smoke: I was paired with the hon. member for South Oxford (Mr. Cayley). Had I voted I would have voted against the amendment.


Joseph Henry Harris: I was paired with the hon. member for Cartier (Mr. Jacobs). Had I voted I would have voted for the motion.


Franklin Smoke: I was paired with the hon. member for South Oxford (Mr. Cayley). Had I voted I would have voted for the motion.


Harry Bernard Short: I was paired with the
hon. member for Kenora-Rainy River (Mr. Heenan). Had I voted, I would have voted for the motion.


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


Henry Alfred Mullins: I was paired with the hon. member for St. Boniface (Mr. Howden). Had I voted, I would have voted for the motion.


Paul Mercier: I was paired with the hon. member for West Hamilton (Mr. Bell). Had I voted, I would have voted against the subamendment, for the amendment, and against the main motion.


Mr. BROWN:: I was paired with the hon. member for Souris (Mr. Willis). Had I voted, I would have voted against the subamendment, for the amendment, and against the main motion.


John Thomas Hackett: I was paired with the hon. member for Wright (Mr. Perras). 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. VALLANCE:: I was paired with the hon. member for Rosetown (Mr. Loucks). Had I voted, I would have voted against the motion.


George Brecken Nicholson: I was paired with the hon. member for North Timiskaming (Mr. Bradette). Had I voted, I would have voted for the motion.


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


Mr. BUTCHER:: I was paired with the hon. member for Portage la Prairie (Mr. Burns). Had I voted, I would have voted against the motion.


Joseph Léonard Duguay: I was paired with the hon. member for Bagot (Mr. Dumaine). Had I voted I would have voted for the motion.



WAYS AND MEANS


[Stage Direction]
The house in committee of ways and means, Mr. Hanson (York-Sunbury) in the chair.
Progress reported.
On motion of Mr. Bennett the house adjourned at 11.25 p.m.

Questions
Wednesday, April 12, 1933