1933-05-17

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

[Stage Direction]
Mr. MERC1ER (Laurier-Outremont) :
Do the recent decorations granted in the Order of St. Michael and St. George, and in the Order of St. Gregory the Great, mean that Canadians holding titles in any order may now accept promotions in the same order as long as such promotions do not carry any rank or title?
Mr. BENNETT:: 1.	The promotion of the Right Honourable Sir George Halsey Perley, K.C.M.G., to be an ordinary member of the first class or Knights Grand Cross of the Most Distinguished Order- of St. Michael and St. George, was made in conformity with established constitutional practice, it being the considered view of His Majesty's government in Canada that the motion, with respect to honours, adopted on the 22nd day of May, 1919, by a majority vote of the members of the Commons House only of the thirteenth parliament (which was dissolved on the 4th day of October, 1921) is not binding upon His Majesty or His Majesty's government in Canada or the seventeenth parliament of Canada.
2.	The government has no official knowledge of promotions in or appointments to the Order of St. Gregory the Great.


SENATE VACANCY
[Stage Direction]
Mr. LaVERGNE:
1.	Is there a Senate vacancy in the La Salle division?
2.	If so, since what date?
3.	Will the government fill the said vacancy in the near future?
Mr. BENNETT:: 1.	Yes.
2.	January 23, 1933.

Questions
3.	An appointment will be made in due course.


CARLETON, QUE., POST OFFICE
Mr. MARGIL:: 1.	What was the revenue of the Carleton post office, county of Bonaventure, for last year?
2.	Does the appointment of the new postmaster remain with the department or the Civil Service Commission?


Mr. SAUVE:: 1.	$1,307.88.
2.	With tlie department.


GOLD DEPOSITS
Mr. DORION:: _ 1. What was the value of all gold deposited in the vaults of Canada's various chartered banks and in the vault of the Department of Finance, at March 31, 1923, and at March 31, 1933?
2.	What was the value of gold deposits known to be held throughout Canada, at March 31, 1923, and at March 31, 1933?
3.	What was the total amount of notes issued by chartered hanks or by the federal government in circulation throughout Canada, at March 31, 1923, and at March 31, 1933?
4.	What was the value of silver and copper currency in circulation throughout Canada, at March 31, 1923, and at March 31, 1933?


Mr. RHODES:: 1.	Marcli 31,	March 31,
	1923	1933
Gold held by Minister of Finance	
^Current gold and subsidiary coin held-	8128,740,130	S 71,815,753Chartered banks in Canada	
Gold deposited by banks in central gold	58,394,063	38,583,752reserves	9,502,533	9,181.7322. No record in Department of Finance other than as	to amounts referred to in answer to	March 31,	March 31,1923	19333. Dominion notes in circulation	8242,657,765t	S180.926.SS2tBank notes in circulation	173,258,362	130,135,230$415,916,127	8311,062,1124. Silver coin	8 26,574,145 55,460	[DOT]S 28,051.477Nickel coin	L896.527Bronze coin	1.962,863	2,553.883S 28,592,468	8 32.501.SS7
* Gold not reported separately in bank returns.
t Includes Dominion notes held by banks and in central gold reserves amounting to $215,797,880 (1923) and 8151.911,399 (1933).


SAINTE-ANNE DE BEAUPRE POSTMASTERSHIP
Mr. CASGRAIN:: 1.	Is the government aware that the postmaster at Sainte-Anne de Beaupre and his son are actively engaged in municipal politics?
2.	Have they asked permission of the Post Office Department to do so?
3.	Has the Post Office Department granted them permission to participate in municipal elections in the village of Sainte-Anne de Beaupre ?
4.	If so, when and by whom was such request made, and by whom was it granted?


Mr. SAUVE:: 1.	No.
2,	3 and 4. Answered by No. 1.


FEDERATION OF LABOUR CLUBS
Mr. CASGRAIN:: 1.	Who authorized the Federation of Labour Clubs of Montreal to use the drill hall on Craig street, at Montreal, for their meeting on April 30, 1933?
2.	Was an application made to the authorities of the Department of National Defence to secure the use of said drill hall on this occasion ?
3.	If so by whom was such application made?
4.	Was the application made in writing or orally?
5.	What sum did the Federation of Labour Clubs of Montreal pay for the use of said hall for the purposes of such meeting?
512S
Questions


Air. SUTHERLAND:: 1.	Department of National Defence.
2.	Yes.
3.	Mr. J. A. Chalifoux, General President, Federation of Labour Clubs of the province of Quebec.
4.	In writing.
5.	S10.


STORNAWAY, QTJE., MAIL DELIVERY
Mr. BOULANGER:: 1.	Does Mr. Ernest Bourque still hold the contract for rural mail delivery at Stornaway, province of Quebec?
2.	If not, who has the contract now?
2. Was the present contract awarded after calling for public tenders and to the lowest tenderer ?
4.	Who were the tenderers and what was the amount of the respective tenders?


Mr. SAUVE:: 1.	No.
2.	Adolphe Bolduc.
3.	Yes.
4.	Adolphe Bolduc, Stornaway, S800 per annum; Eugene Poisson, Stornaway, $800 per annum; Willie MacArthur, Stornaway, $840 per annum; Arthur Breton, Stornaway, $900 per annum; Hormisdas Pepin, Stornaway, $900 per annum; Milton Macleod, SpringhiU, $900 per annum; Odias Breton, Stornaway, $935 per annum; Archdas Breton, Stornaway, $945 per annum; Adolphe Bolduc, Stornaway, $973 per annum.


PENSION TRIBUNAL
Mr. DUFF:: 1.	Did the government pay or will they pay the personal expenses of the following members of the pension tribunal to Ottawa since April 15. 1933. namely: Colonel Cyrus Peck, Colonel N. H. McLeod, Colonel Gagnon, Colonel Thos. Morrison, Colonel C. C. Thompson, Mr. J. I. Grover?
2.	(a) How long 'has each of these members of the pension tribunal been at Ottawa during the past month; (b) what governmental or tribunal duties have they performed daily since their arrival here?
3.	How many tribunals are sitting in Ottawa at the present time and how many claims have each of these members heard since their arrival in Ottawa?


Mr. RHODES:: 1.	Colonel Morrison and Major Thompson, having their headquarters in Ottawa, do not draw travelling expenses. The expenses of the other members referred to are under review.
2.	(a) Colonel Morrison, April 10 to date of inquiry, May 9; Colonel Peck, April 12 to

date of inquiry, May 9; Colonel McLeod, May 6 to date of inquiry, May 9; Colonel Gagnon, March 30 to April 26; Major Thompson, March 30 to April 26; Mr. Grover, April 27 to May 5.
(b) The tribunal has been engaged on its regular work, namely the hearing of claims and giving of decisions; also the review of files and giving of decisions on claims previously heard, on which decisions were outstanding, and has sat on the following days during the month preceding May 9:	April 10, 12,
inclusive; April 18, 21, inclusive; April 24, 28, inclusive; May 1, 5, inclusive; May 8, 9, inclusive.
The tribunal did not sit on Good Friday, Easter Monday, nor on Saturdays or Sundays.
3. One tribunal in session since March 30. Claims heard by: Colonel Morrison, Nil; Colonel Peck, 48; Colonel McLeod, 9; Colonel Gagnon, 47; Major Thompson, 24; Mr. Grover, 12.
Seventy cases, in all, were heard.
In addition, decisions were made on claims heard previously, as follows:
Colonel Peck, 5; Colonel McLeod, 6; Colonel Gagnon, 10; Major Thompson, 8; Mr. Grover,
4.	Total 33.


MOTION FOR PAPERS
Mr. FERLAND:: For a copy of all telegrams, letters and other documents exchanged since August, 1930. between the Minister of Railways, any official of his department, or between any other federal department and any official of such department, and any other individuals, public bodies, companies or associations, including the railway administration, respecting the repair shops of the Canadian National Railways at *Toilette, the Joliette terminal, the contract relating to these shops and this terminal, and all other matters connected therewith since August, 1930.


JUDGES ACT AMENDMENT
[Stage Direction]
On the orders of the day:
Mr. S. W. JACOBS (Cartier):: Might I ask the Prime Minister whether, in view of the defeat of the government measure in the Senate respecting judges, it is his intention to place the resignation of the government in the hands of His Excellency.


Right Hon. R. B. BENNETT (Prime Minister):: I 'have no such intention, nor did
I ever suggest it should be so except on joint resolution.

Beauhamois-Mr. Bennett


BEAUHARNOIS POWER PROJECT
[Stage Direction]
On the orders of the day:
Richard Bedford Bennett: Before the orders of the day are
proceeded with I think it fitting that I should make some reference to the Beauharnois undertaking in view of statements made a few days ago which I have since 'had an opportunity to look through. I shall be as brief as possible, but I desire to correct some misapprehensions that are apparently in the minds of hon. gentlemen diagonally opposite and opposite and to my right. I think nothing better illustrates the soundness of the old maxim that it is very unwise to endeavour to lock the stable after the horse has been stolen, or the truth that is embodied in the couplet with which most of the house is familiar:
Not heaven itself upon the past hath power: What has been has been.	.
Nothing better illustrates the truth of these statements than the position of Beauharnois, and when hon. gentlemen suggest, as they did in this house, that the federal government of the country should engage in the power business and should expropriate the power enterprise at Beauharnois, they overlooked two essential facts. The first is that the province of Quebec leased the power, not -the Dominion government; and it leased the power believing that it had the legal right so to do. The ex-Minister of Justice referred to the fact that a similar attitude of mind was expressed by the government of Ontario in connection with the power development carried on at Niagara and other points on the St. Lawrence river. The second point to which I direct attention is that contracts were made between Beauharnois undertaking and two customers, namely, the Hydro Electric Commission of Ontario and the Montreal Light, Heat -and Power Company, which contracts are outstanding and are valid contracts according to the law of the country in which they were made.
If this house will bear in mind these two facts it will at once realize and recognize the extent to which this government was unable to deal with the problems to which attention has been directed. Reference has -been made to the fact that on more than one occasion I have directed attention to the circumstances connected with the alienation of natural resources by the governments of this country. What the hon. member for Bow River (Mr. Garland) overlooked, in quoting again the statement I made originally, was that the 53719-324
crown is not the crown in right of the dominion only but is also the -crown in right of each of the provinces. Only last year the privy council, in a very important case, decided that while the crown was one and indivisible, nevertheless there was a crown in right of the provinces and a crown in right of the dominion.
If it will Ibe borne in mind that the power rights with respect to the St. Lawrence are claimed by the crown in right of the province of Quebec and not by the crown in right of the dominion, so far as this particular case is concerned, my observations with respect to the regret that the government must experience because the crown has parted with its rights will have full force and effect. Bear in mind, therefore, that as a result of the investigation! in this house, the government took the only appropriate action which it could take under its constitutional limitations. It declared certain works to be for the benefit of Canada, it rescinded and repealed an order in council under which certain claims were made and it passed a statute by which no further alienations, so far as the government was concerned, of its rights in the St. Lawrence river to give additional water to the enterprise, would be valid without the consent, not of the executive but of this parliament.
I shall not traverse the ground which has been covered with respect to these contracts and to the legislation enacted by this parliament after the report was made by the investigating committee. I shall content myself with referring to the statements which were made in the house in 1932 as to what we conceived -our duty to be with respect to the enterprise itself. Before I do that perhaps I should direct attention to the fact that the contract with the Montreal Light, Heat and Power Consolidated, to which I referred, contained a provision by which the Beauharnois company undertook not to compete with the Montreal Light, Heat and Power Consolidated in the distribution of power on the island of Montreal or within the radius of so many miles from the Place d'Armes square. So far as distribution of power was concerned, the company had contracted itself out of the right to sell power in that particular area which is the -most populous and the largest power consuming area in a particular community in the country.
I said that the purpose of the government as declared i-n this house was fourfold, and I shall quote from a statement which I made in this house in 1932, as follows:
The government by every means in its power will endeavour to do the following: (a) secure

Beauharnois-Mr. Bennett

continuance of the enterprise; (b) secure the rights of those who bona fide have put their money in that enterprise; (c) secure proper control and management; (d) take such other steps as may be necessary when terms and conditions are fixed as will ensure the greatest possible benefit to this dominion as a whole by reason of the undertaking now being declared to be a work for the general advantage of Canada.
Those were the four ends the government had in view. First, as to the continuance of the enterprise, it was found that the $30,000,000 which had been given to the company by investors throughout Canada was not sufficient to enable the company to continue its operations and, further, that the company could not secure additional money by making sale of its first mortgage bonds. Therefore, the government undertook to be responsible for any ultimate loss that might be made by the bankers in the advances which were given to the enterprise, on the condition that the enterprise should convey the canal itself to the crown in the right of the dominion so that if the St. Lawrence seaway undertaking was carried out this would be part of and available for the purposes of the seaway. The cost was represented by something in the neighbourhood of the sum which the government ultimately became responsible for in the event of the banks not realizing on their security, namely, between $15,000,000 and $16,000,000. In pursuance of that undertaking the enterprise was carried forward so that on the first day of October last power was delivered to the Hydro Electric Commission of Ontario and the Montreal Light, Heat and Power Consolidated, thereby making possible the continuance of the corporation as such. Had the work not been placed in operation by the first day of October, the contracts would have fallen and in these days I am not sure but that both the hydro and the Montreal Light, Heat and Power would have been glad if the power had not been made available. The power was made available on the first day of October through the efforts taken by the administration. ,
Attention was directed to the fact that shortly after the house rose when we first had to deal with this matter the Premier of Quebec suggested that we should turn over the undertaking to the Montreal Light, Heat and Power Consolidated and relieve ourselves from any further responsibility in the premises. I said then that although the undertaking had been launched for the purpose of being a competitor of the Montreal Light, Heat and Power, I could quite understand the attitude of the Premier of Quebec who did not believe that government should be in-

volved in matters of this kind. Nevertheless I represented that we could not agree to do this for the simple reason that that great corporation was not interested in seeing this corporation succeed, having regard to the then existing conditions. In view of what had transpired in this parliament, we felt that it was our duty to see that no action which took place here should prevent the enterprise from being in position to deliver power on the first day of October last, and W'e took the steps which I have indicated.
Having done that and having seen "that the enterprise was in a position to deliver power, the further question arose as to what should be the attitude of the government. I endeavoured to make it perfectly clear that I could not recommend to this house the creation of a federal power commission to operate in a province a policy which was the exact negation of that of the government of that province. The policy of the government of Quebec is to regulate by appropriate authority the development of power by private enterprise. That is its considered policy and from that policy it has indicated that it has no intention of departing. To create a federal power commission which would take possession, by expropriation or other appropriate proceedings, of t!he property of a private enterprise, whether it be Beauharnois or any other company, was something that we did not care to contemplate and we therefore declined to consider that proposal. .
The company having defaulted in its bonds, the appropriate remedies provided by the trust deed under which $30,000,000 had been advanced became operative and a meeting of the holders of these securities was held. The government divested itself of any responsibility in connection with those investors as to how they should enforce the securities upon which they had made their advances. The}7 appointed a committee and that committee made a report, which was to the effect that a certain scheme of reorganization should be adopted. I was asked whether the position of the government would be the same if other plans were made with other enterprises or other individuals for the purpose of giving effect to the reorganization and I answered in the affirmative; the government had no interest as to individuals nor any communication directly or indirectly with the Montreal Light, Heat and Power. The committee of the bondholder's carried forward their negotiations and as a result of such negotiations the reorganization was arranged as proposed to the bondholders. Stone and Webster did see me and they asked that we should guarantee

Beauharnois-Mr. Bennett
securities, which I declined to do; and I declined to guarantee securities for the reorganizing committee. As a result of all the efforts that were made, a committee of the security holders put forward a plan at a meeting of all the $30,000,000 bondholders for the purpose of enabling them to say aye or nay to the proposals thus made, and the government left itself in a position where the same provisions that existed with respect to that plan would exist with respect to any plan that was put forward for the reorganization of the enterprise. The plan carried and the matter is ended so far as the government is concerned.
There is just one other observation which I desire to make. This house has listened to attacks against power monopoly in the province of Quebec. This house has no concern about what that province does within its constitutional limitations. It is, within the ambit of its jurisdiction, as complete and authoritative a legislative body as is this parliament within its own, and I decline to be drawn into any controversy as to the wisdom or uniwisdom of what Quebec may do within its legislative jurisdiction with respect to power or otherwise. I have endeavoured at all times, at least in my public life, to make clear that I regard the rights of provinces and provincial legislatures as being quite as important to maintain as are the rights and privileges of this parliament within their respective fields of legislative action. In this instance the province of Quebec, for reasons that may seem good to it but with respect to which I as a member of the Dominion parliament have no business to concern myself, has made the determination that it will proceed by private capital to develop its power resources and that it will create, as it has, a tribunal for the purpose of regulating and determining rates. All I can say is that any contest that may take place between the users of power and the corporation supplying it, for the purpose of securing a reduction in rates is a matter beyond the control of this parliament; it rests solely and entirely within the control and jurisdiction of the legislature of Quebec and the people who elect that legislature. As to the wisdom of their plans, I have nothing whatever to say.
That being so, there is only one further question that I think should be dealt with, and that is the export of power. With respect to the export of power from Canada to the United States, those who are interested will find that in 1925 the legislature of Quebec passed a statute, the preamble of which is as concise and powerful an indictment of any policy that will permit the export of power 53719-324J
as it is possible to conceive can be put into words. No stronger indictment as to the evil consequences that will flow from permitting the export of power to the United States can be found than will be found in that statute. But the province of Quebec has not the jurisdiction over the export of any commodity from this dominion. That rests within the jurisdiction of the dominion, and this parliament passed a statute which provides for licences being given before power or gas is exported from our country. There are outstanding certain export licences with respect to what is called surplus peak power, off peak power, if you will, at Niagara. I am not at the moment concerned about those, because they were granted many years ago and they have been continued even unto this day. But with respect to the granting of licences to export power, it is the considered judgment of this government as at present advised that we shall not grant any such licences. I say that for two reasons: first, that it has been the settled policy of this country to maintain that view; it has been the view of successive governments, although there was put forward here some years ago a proposal which was negatived largely through the efforts of my colleague the Minister of Trade and Commerce (Mr. Stevens). But the second view, which after all is the powerful and prevailing one in my judgment, is the one indicated a few days ago by the hon. member for Bow River (Mr. Garland) and expressed in terms, to which I need not again refer, by my colleague the leader of the Senate. Those words are as appropriate to-day as they were when they *were uttered. We cannot afford to export power and create community life in another country with industrial activities and then, when the requirements of our own country call for cutting off the licence for export, contemplate that situation without having regard to a statement made by a president of the United States that such action on our part would practically be considered an unfriendly act. Under those circumstances I make the statement I have made this morning for the purpose of relieving any doubt there may be in the minds of any hon. member that the government has in contemplation the granting of licences for the export of power. I shall not trouble the house further and I offer an apology for dealing at such length with this matter this morning, but I desire to summarize the position in a few Short sentences.
We came into this matter, the Beauharnois power development, in consequence of statements that were made in the house that
Beauharnois-Mr. Bennett

brought about an investigation by a committee selected by the House of Commons. That investigation resulted in certain recommendations being made to which this government gave effect. There was mentioned the other day one matter that I do not think was investigated by the committee and with respect to which it may be necessary for the government to make further inquiry; that is, the Jacques Cartier Investment Corporation or something of that sort, I am not just sure of the name, as regards which certain allegations were made in consequence of which we have made and will continue to make certain inquiries.
At the time there were outstanding contracts for about 400,000 horsepower with the Hydro Electric Commission of Ontario and the Montreal Light, Heat and Power. There were restrictions upon the activities of t'he corporation in the selling and distribution of power. The corporation was a provincial one. The government gave it such assistance as was necessary to enable it to secure from the banks the funds required to start the enterprise, and within the time limit of the contracts, the enterprise began to function and supply power. Next, the government furnished every facility possible to enable those who had paid their $30,000,000 into the enterprise to meet together and determine what action they should take, whether by foreclosure that would vest all the shares of the company in them, or by reorganization. They determined upon a plan of reorganization which involved certain assistance being given in the way of extending the time within which to carry out their undertakings and sell their securities, which we made available to any company or persons who desired to participate in the enterprise.
Lastly, the government has incurred no further responsibility nor does it financially or otherwise in connection with this purely provincial matter, and we shall do everything in our power to see that the arrangements that have been made with the government are carried into effect, for in consequence of the contracts outstanding the government had no control over rates in any way, shape or form.
The observations which I made after the non. member for Acadia (Mr. Gardiner) had spoken are veiy pertinent now, and they were then but for one fact, that I was not then aware that the enterprise had made its agreements which precluded any possibility of action being taken by this administration with respect to the price at which power was being sold or could be sold, or for that [Mr. Bennett. 1
matter, I suppose, taken by the late administration after the order in council had been passed.
I have nothing further to add except to say that every possible oportunity was afforded to those who owned the enterprise to do with it as they pleased, but that the government in pursuance of the policy adopted by this 'house practically unanimously afforded an equal opportunity to all who might be concerned to assert their rights and to deal with the situation amongst themselves as shareholders as they thought desirable.
As to my own view, I regretted and I still regret that it was possible for the Montreal Light, Heat and Power Consolidated to place itself in the position it did with respect to this enterprise, but that is a matter over which I had no control and over which this government has no control, but which arises by reason of the fact that the contract which was made with this Beauharnois enterprise by the Montreal Light, Heat and Power Consolidated is a contract that limited and limits I think for a period of seventy years-a lifetime contract-the right of the Beauharnois Corporation to distribute power practically within the whole island of Montreal. That we could not deal with because we had no power to destroy a contract validly made according to the laws of the province of Quebec between the two companies. Under those circumstances, with the full facts (before us, we took the only steps that could be taken to afford to those who had put their money in an opportunity for a breathing space in which to reorganize their enterprise and to take such steps as they thought desirable for the protection of their investment and the undertaking which has been built by reason of their investment being made.


Mr. EULER:: May I direct just one question to the Prime Minister? Has the government freed itself of its liability with regard to its guarantees to the bank of some fifteen or sixteen million dollars' worth of expenditures?


Richard Bedford Bennett: I said that we had not
freed ourselves of the ultimate responsibility if there was a loss on the sale of the securities, but that is not a contingency that we look upon as being one of any seriousness.


Mr. WOOBSWORTH:: Would the Prime
Minister permit another question? He has stated that it is the definite policy of the government that there shall be no licences granted for export. I should like to ask whether it is also the policy of the government that there should be no further permits for the diversion of water from the St. Lawrence.

Canada Shipping AcL-Mr. Coole


Richard Bedford Bennett: Possibly the hom. member for Winnipeg North Centre was not in his place when I said that we had already provided by statute that although the province of Quebec had granted a licence for further quantities of water we would not authorize a diversion from the St. Lawrence except by the authority of this parliament.


REPAYMENT OF LOANS TO BANKS
[Stage Direction]
On the orders of the day:
Hon. E. N. RHODES (Minister of Finance):: M r. Speaker, yesterday the hon. member for Weyburn (Mr. Young) made inquiry with respect to the payment of an issue of [DOT]$40,000,000 of two year treasury notes which matured in New York on December 1 of last year. He wished to know, first, in what funds tlhey were payable, and secondly, how much it had cost in Canadian funds to meet the obligation. The answer to the first part of his inquiry is that they were paid in United States funds, and the answer to the second part is that they were paid out of the proceeds of an issue of one-year treasury notes which were placed in New York. The complete answer to his question will, of course, depend upon the rate of exchange at the time when the obligation is ultimately liquidated. It follows that if Canadian funds were at a parity at that time the amount of Canadian funds then required would be $40,000,000.


Mr. E. J. YOUNG (Weyburn):: That does not quite explain it, but I suppose we can figure it out. It is all right.



CANADA SHIPPING ACT

[Stage Direction]
The house resumed from Tuesday, May 16, consideration of the motion of Hon. Mr. Duranleau for the second reading of Bill No. 106, to amend the Canada Shipping Act.
Mr. G. G. COOTE (Macleod):: Mr. Speaker, in any remarks I have to make on the bill which is now before the house I intend to deal only with section 11, which relates to the coastal shipping of Canada. I think the minister frankly admitted last night that the bill was principally for the protection of ship owners, so we are justified in dealing with the bill from that standpoint. From a perusal of the evidence it is clear who is asking for this bill. It is the shipbuilders and the Shipping companies, and I think they are chiefly under one concern, Canada Steamships Limited. They are both shippers and shipbuilders. They own the Midland Shipbuilding Company of Midland and the Davie Shipbuilding Company of Levis. Prominent amongst the witnesses before the Senate committee I noticed the names of Mr. Enderby and Mr. Wolvin, Who figured so prominently in the association or combine that was responsible for raising grain rates on the great lakes in 1922, and which finally resulted in the appointment of a royal commission to investigate grain rates on the great lakes. As a result of that investigation two bills were introduced in the session of 1923, one placing these grain rates under the jurisdiction of the board of grain commissioners, and the other giving the governor in council power to suspend the coastal shipping laws at any time.
I noticed that the Minister of Trade and Commerce (Mr. Stevens) last night, in the very able speech which he made on the second reading of this bill, said that it was the duty of parliament to promote the interests of the various industries in Canada, and he apparently was speaking of the shipowning industry. I think the ship-owning industry are very well able to take care of themselves, judging by their action of last year.


Mr. STEVENS:: May I interrupt my hon.
friend? It is certainly not correct for him to state that I represent the ship owners. I do not represent anyone of that character or any business interest in this house.


George Gibson Coote: Let me assure the minister I did not say he represented them at all.


Henry Herbert Stevens: You said that exactly.


George Gibson Coote: No; Hansard will show I did not say that. I did not intend to say it, and if accidentally I did say it I shall quite gladly withdraw it. I said that his remarks last night were directed in defence of or in support of the interests of the ship owners.


Henry Herbert Stevens: No. Mr. Speaker, I must ask my hon. friend not to state it in that way, because it is not right. One can make an argument pro or con, but it does not necessarily follow that he represents the interests of any particular industries or particular class.


George Gibson Coote: I shall gladly accept the statement of the minister and withdraw anything to which he may object. But I wish to make it plain that I think the ship owners are much better able to take care of their own interests than are the producers. I am very much concerned about the interests of the producers. I believe they are the ones who need protection. Mr. Enderby, when before the committee, was quite frank. He admitted the principal reason for the section of the bill to Which we are objecting is to give protection to Canadian shippers. The principal function of the Canadian fleet is the movement of the Canadian crop across the great lakes.


Henry Herbert Stevens: May I interrupt the hon.
member? Yesterday he asked me if there had been an order, I had not time to send it over then, I will do so now. There was an order actually passed by the board of grain commissioners on the 5th of May of this year. There is no necessity to wait for an investigation.


George Gibson Coote: 
Mr. DURANLEAU:: Will my hon. friend permit a question? What is his answer to clause 938 of the Canada Shipping Act? Does he not think there is sufficient protection for our grain shippers in case of monopoly? It gives power to the governor in council at any time to suspend the operation of any provision of this part of the statute.


George Gibson Coote: I am glad that is in, but we know from past experience that sometimes it takes about three months after rates are raised to get the governor in council to act. I think it naturally will take a little time.


Mr. MANION:: It could be done overnight.


George Gibson Coote: I would like to make it clear about rates to Buffalo being cheaper than to Port Colborne. This is from the evidence of Mr. Smith:
I mean this, senator, that the Canadian boats usually get a higher rate to the bay ports and

Canada Shipping Act-Mr. Coole
to Port Colborne than the American boats get to Buffalo, and therefore the Canadian boats are not willing to run to Buffalo at a lower rate if they can get a higher rate to Port Colborne and the bay ports. My experience has been that Canadian boats have not wished to take grain to Buffalo to any great extent.
Once this legislation is passed I think practically all the grain will go to Canadian ports and they will get the better rate. Someone will have to pay it.
Might I point out that this legislation which the minister mentions was introduced in 1923. Mr. Robb, the Minister of Trade and Commerce at that time I think was not very much impressed with it himself, that is be was not very sure that the board had all the powers it should have, or rather that their power to control rates would be very effective as far as the producer was concerned. He said:
The importance of this measure does not consist in the fixing of a maximum rate; we find the importance of it, the teeth of it, in the gathering of the information, the tabulating of it, the publication of that information, and the publication from day to day, during the season, of the space that has been booked and the space that is available for shippers. That is where we find the very teeth of this measure;-
I do not think they are very effective teeth myself.

and it is in that respect that it is opposed. It is opposed not because there happens to be in it a clause that gives the board the right, if they deem it wise, to fix a maximum rate, but because the measure provides machinery upon which the government can act intelligently and arrive at a decision that will justify the [DOT] suspension of the coastal laws.
So really the only effective protection we have is the power of the governor in council to suspend the coastal shipping law. For my part I would not have this coastal shipping law apply. That is, I would not want to prevent American ships coming in and carrying grain to Buffalo, and agaiij carrying it to Montreal if necessary.


Mr. BOWMAN:: They can now as a
matter of fact carry grain to Buffalo.


George Gibson Coote: Quite so. But I say again
carrying it to Montreal. Any Canadian shipper who ships grain to Buffalo now has to take a chance on getting his price by shipping it through American channels.


James Langstaff Bowman: Not at all, because an
American ship can carry it from Buffalo to Montreal.


George Gibson Coote: Well, that is a point that
has to be made clear to me. It has got to go by boat owned by this combine, because all the Canadian ships are in the combine.


Robert James Manion: What combine?


George Gibson Coote: The Lake Shippers' Association, I think it is called.


Robert James Manion: Not much of a combine,
because they compete with each other. I can give the 'hon. member some figures on coal which will show they are far from a combine.


George Gibson Coote: I hope the minister will give some figures on wheat also. I think we are going too far in this idea of nationalism when we cannot move goods from one Canadian port to another in anything but a Canadian boat. I suppose soon we will not be allowed to travel from one part of Canada to another unless we stay in Canada.


Mr. NICHOLSON:: May I ask my hon.
friend a question? Is it any more unreasonable that we should provide that protection for Canadian ships than the United States government provides for American ships? A Canadian vessel cannot engage in trade from one American port to another.


George Gibson Coote: There is a distinction to be drawn on that point, but I will ask this of the minister and also of the hon. member for East Algoma: Will they agree to place on the Canadian statute books some other laws in conformity with laws dealing with similar matters that are now in force in the United States? I will give an instance. There is a law in the United States which allows an American citizen who is abroad to buy $100 worth of merchandise and take it back free of duty. Will he support the placing on our statute books of a similar law to allow Canadian tourists to bring back from the United States $100 worth of merchandise free of duty? If his argument applies in the one case it should apply in the other. If I go to the United States and one of my automobile tires happens to play out and I buy one there, when I get to the line I have to pay duty on that tire before I can get back home. The United States law allows an American to buy a motor car, if he likes, in Canada, either new or secondhand, and take it back with him at 25 per cent duty; our government will not allow a man to bring in a secondhand automobile at any rate of duty. Does the hon. member think we should change our law in that respect to correspond with the law in the United States?
With regard to the suggestion of the hon. member for East Algoma, may I ask this question. Because the United States has a coastal shipping law which prevents a Canadian boat from hauling grain from one

Canada Shipping Act-Mr. Coote
American port to another American port, why should we have exactly the same law here? The conditions are not the same, because Buffalo happens to be an American port. Any exporter from the western states can send grain from Duluth to Buffalo and later send it on from Buffalo to Montreal if he wishes, or he can send it from Buffalo to New York. He can send it by the Erie canal. But the Canadians will not have that privilege. I understand the hon. member for Dauphin to say that we can send it on if we send it in a Canadian ship.


James Langstaff Bowman: Send it in an American ship.
Mr. CO.OTE: Not from Buffalo to Montreal, if it has been brought down in an American ship.


James Langstaff Bowman: That is a different proposition. We have no transfer points in Canada to compare with Buffalo. It is true we have a transfer elevator at Port Colborne with a capacity of 4.000,000 bushels.


Robert James Manion: And there are the bay ports.


George Gibson Coote: Yes, but they do not compare with Buffalo at all; Buffalo is strategically located, and there is no point in Canada that compares with it fairly.
I regret very much that this bill, if it must be passed, did not come down earlier in the session and go before a select committee of the house. Before it is passed Canada Steamship Lines, which is the biggest company in the association, should be investigated. We should investigate the capitalization of that concern; -we should investigate its earnings in past years. The minister said last night that the rates they charged this year, although they did raise them to 7 cents, were not as high as in former years. Well, they should not be as high. Why did we spend S150,000,000 on the new Welland canal? Was it not in order that there might be lower rates on grain as well as other freight? In my opinion the rate of 7 cents, considering the price of grain and having regard to the fact that everything in Canada was supposed to have been reduced, was excessive.


Henry Herbert Stevens: 6| cents, not 7.


George Gibson Coote: They raised it to 7 cents and it was brought back to 6i only under pressure from the board. It seems to me that the shipowners have a good deal of nerve to come forward at this time and ask for this legislation. I do not wish to delay the house, but I do insist that this is the very worst
time the government could have chosen to bring down legislation of this kind. The Prime Minister was in Washington lately and discussed with the president of the United States the possibility of securing better trade relations, and in this connection I may quote from an article that appeared in the Montreal Star of Saturday, May 13. This article appears under the heading:
United States considers protest against change in shipping laws. . . . Measure would reduce shipment of grain in American vessels.
It is dated Washington, May 13, and reads in part:
Acting in response to the vehement pleas of Buffalo and United States lake shipping interests, the State department is considering making a protest to the Canadian government against the pending amendment to the dominion shipping laws aimed to reduce the shipment of Canadian grain down the lake in United States ships to Buffalo for transfer there to dominion vessels for export overseas through Canadian ports. Following representations made at the State department on Thursday afternoon by Congressman Andrews of New York, informal discussion of the problem was carried on between department officials and Hume Wrong, charge d'affaires of the Canadian legation.
I repeat therefore that this is the very worst time to introduce such legislation as this. It is very apt to be regarded by the public in the United States as a sort of retaliatory measure, and while I am not concerned about United States shipping, we do have to depend upon it sometimes to get some relief in rates. We suspend the coastal shipping laws and invite these ships to come in and carry our grain at lower rates.
This whole bill suggests pressure from the shippers' combine, or if that word is objectionable I will say association. I do not think the house should deliver our producers into the hands of the association. In my opinion the legislation we have to control rates is not effective enough, and I must protest as vigorously as I can against legislation of this kind. I would ask the government to put it off another year and let us have a thorough investigation of the whole matter by a committee of the House of Commons. So far as I am concerned I will not consent to being governed in this case by the work of a committee of the Senate. So far as I can see from a perusal of the evidence given before the Senate committee, there did not appear to be any members of the Senate acting as representatives of the producers. The representatives of the shipping interests were not questioned by anyone representing the producers. I want to see these men brought before a House of Commons committee and we should be given an opportunity to obtain a good deal more

Canada Shipping Act-Mr. Coote
information in regard to this whole question before we pass this legislation, even though it may be held in abeyance in the meantime and may come into force only by proclamation of the governor in council. I do not think we should adopt this legislation, and for my part I cannot allow it to pass without recording my vote against it.


James Langstaff Bowman: The hon. member made
the statement that grain loaded in Buffalo must go through American ports. Surely he did not intend to convey that impression to the house.


George Gibson Coote: That, I said, was the impression which I got from reading the bill, and if it is not correct I hope the point will be made clear. Section 935 reads:
No goods shall be transported by water or by land and water, from one place in Canada to another place in Canada, either directly or by way of a foreign port, or for any part of the transportation in any ship other than a British ship.
It says, for any part of the transportation.


Alfred Duranleau: There is no objection to that.


George Gibson Coote: I understand my hon. friend from Dauphin to say that if grain goes from Fort William to Buffalo in an American ship it can then go on from Buffalo to Montreal in a Canadian ship.


An hon, MEMBER:: No.


George Gibson Coote: Well, that is the point I
want to have made clear.


Robert James Manion: If it goes to Buffalo in a Canadian ship it can go on to Montreal in a Canadian ship-a British ship.


Mr. KENNEDY (Peace River):: But you cannot retain the identity of the grain and tell which came out of the Canadian vessel.


George Brecken Nicholson: In the course of his remarks on this subject my hon. friend who has just resumed his seat (Mir. Coote) said that the bill was asked for by the shipping combine or the Lake Shippers' Association. Personally, I have no brief for the Lake Shippers' Association or the shipping combine either, but I have a brief to some extent at least for the many thousands of Canadian working men who are engaged in the shipping business at the head of the lakes or at ports in Canada or the United States for that matter. For fifty years we have been spending enormous sums of money on harbours, lake ports, wharves, and various facilities for shipping. We are spending annually large sums for lighthouse services, pilotage 
service and all this sort of thing for the purpose of making inland shipping safe and providing ample facilities by which traffic from the west can be moved to the east in the easiest and cheapest manner possible. Now, the question here arises: Whom are we doing this for? Judging from the statements of my hon. friend and others in relation to this matter, notwithstanding that we have spent all this money on the services I have mentioned, we are to turn over the whole busineiss to United States shipping and United States working men, while in every port, from Fort William to Montreal, there are hundreds of Canadians who have been trained in the lake service captains, engineers, firemen, dock-hands and so on idle while American ships are carrying the traffic.


George Gibson Coote: W'ould my hon. friend permit an interruption for the sake of accuracy? He said that we had suggested that all this business would be turned over to American shipping interests. I ask him to withdraw that statement as no one has suggested any such thing.


George Brecken Nicholson: I hesitate to withdraw that statement. If my hon. friend did not mean that and I am doing him an injustice, I will withdraw it, but that is really what has been advocated. Anyone who knows anything about the conditions on the great lakes and the St. Lawrence knows that if present conditions continue, Canadian shipping will be driven off the lakes. The circumstances are such that it is impossible for them to compete.^ In the first place, American ships are provided with return cargoes not available to Canadian ships.


Edward James Young: Why? Because the government will not let them take back coal.


George Brecken Nicholson: No, they cannot take back coal or anything else that goes to an American port. That is why. The proof of this statement can be found in the records. If my hon. friend will go back to 1920 he will find out what took place when American shipping was in control, not only with regard to rates on coal but with regard to rates on grain. The rates in 1932 were the lowest that have prevailed since 1920. I am virtually certain that lower rates have never prevailed.
In s-peaking of the competition provided by American ships my hon. friend stated that the rates are controlled by this competition. Let us see how it works out. When Canadian shipping on the great lakes had a capacity of 165,000,000 bushels, the average rate was 10-78 cents. When the capacity of Canadian shipping had been increased to

287,000,000 bushels, the rate was reduced to 5-07 cents. I should like to give my hon. friend one illustration of the position in which Canadian shipping will be placed should the monopoly and control be given to United States shipping, as will be the case unless the provisions of this bill are made applicable. During one of the years when the United States ships were in complete control and the rate on grain was 11-64 cents instead of 5-07 cents, I came into direct connection with some United States shippers.


Mr. SPENCER:: May I ask what year
that was?


George Brecken Nicholson: The year 1920. One of the firms which had been busily engaged in the transport of grain from the head of the lakes through Buffalo and on to Montreal entered into a contract with a Canadian shipper to carry some 3,000 tons of freight from one lake port to another. This contract was entered into during the fall of t'he year, the goods to be carried in the following summer. In the meantime the rates rose, and what happened? The American company put themselves into liquidation. They sold their ships to the clerks in their own office and raised rates just 150 per cent on the Canadian commodity that was to be carried. That is the position in which hon. friends want to put Canadian shippers; they want to drive Canadian ships off the lakes. My hon. friend as well as the hon. member for Weyburn has inquired why Canadian ships could not compete. I should like to show them the tonnage that Canadian ships cannot handle. During a period of ten years there was an average tonnage of 45,000,000 tons in the form of coal, ore and stone handled on the great lakes by American ships. Not one single ounce of this tonnage could be carried by Canadian ships. Let us see what has happened with regard to grain. The hon. member who has just left the chamber stated that the American ships carried a very small percentage of Canadian grain. For the ten year period ending 1932, American ships carried on an average 126,000,000 bushels of grain from Canadian ports to United States ports, while Canadian ships carried on an average 11,000,000 bushels. The position has become so accentuated that Canadian seamen and Canadian workingmen are idle while American ships are carrying Canadian^ trade and Canadian ships are not able to participate in American trade.
I am not anxious that there should be any difficulties or controversies between the two countries. If hon. gentlemen can make an arrangement by which Canadian shipping will
Canada Shipping Act-Mr. Nicholson
be permitted to participate in the coastwise trade of the United States on the great lakes and the St. Lawrence river, I would be in favour of withdrawing this bill. Is it fair that this country to the south of us with its large volume of trade should have its shipping tied up in a castiron box and reserved for its own people while Canadian shipping companies are forced to meet competition which is absolutely impossible. I do not think there is an hon. member in the house who will suggest that the rates in effect last June and July were such as made it possible for a shipping company to continue to operate and pay the Canadian workingman a wage upon which he could live.
There is another point to be considered. Facilities have been provided at the head of the lakes, at Collingwood, Midland, and other points for the repairing of ships. Large sums of money have been invested and large numbers of Canadian workingmen are dependent upon this industry. You never hear of a United States ship coming across to one of these shipyards and giving employment to Canadian workingmen. But it is suggested that the Canadian ships which do make use of these facilities should be driven off the lakes. Such a procedure would force the closing up of these shipyards and throw Canadian workmen out of employment and Canadian investments into the discard.
The Minister of Railways and Canals (Mr. Manion) gave some evidence to show that there is no combine existing. I personally know that there is no such thing as a combine. It may be true that the Canada Steamship Lines, Limited, own the largest tonnage on the lakes but-


Robert James Manion: They compete with other
boats.


George Brecken Nicholson: Certainly, they compete. There are other companies which operate ships. I know two captains who live in Sault Ste. Marie. They have sailed the lakes all their lives and they formed a small company and purchased three ships. They are operating them from the head of the lakes to Port Colborne and Montreal and they compete with everybody in order to get traffic for their vessels. Is it a crime that Canadians should do that sort of thing? Is it a crime that Canadian workingmen should desire to work in their own country when they are not allowed to compete in the country alongside of us? Have we reached the stage where the only person who is to be considered as being entitled to the rights of Canadian citizenship is the man who grows wheat on the western
5140	COMMONS
Canada Shipping Act-Mr. Nicholson
prairies? That has been indicated by the discussion which has taken place.
The question of the protection of the producer has 'been raised, but an attempt is being made to penalize the producer. After all, who is the producer of wheat? Wheat is grown on the western prairies but it would noit be worth anything if a market could not be found. Where is this market to be found? It will be found at the place where there is someone who wants to buy the wheat and in the main that is in Europe. How are you going to get it there? The railroad man who operates the wheat train from the fields of the west to the head of the lakes is just as much a producer of wheat as is 'the man who drives the plough over the prairies. The sea -captain, the engineer, the deck hand and the other .men who go out in all kinds of weather and risk their lives to carry that grain across the lakes and down the river are just as much producers and just as much entitled to be protected by this parliament as is the man who actually works on the farm, the so-called producer of the grain itself. Instead of thi's bill being introduced too early, I say that the -men interested, the men who have been lying idle in the ports of this country waiting for the possibility of getting an odd job here and there on a Canadian Ship, have waited too dong and this bill should be put through and made effective during the present shipping season.
I do not wish to delay the house by giving further figures, as to what has taken place. But during the period when the United States had control of the situation, that is during the war and the early period after it, Canadian wheat producers had to pay the highest rates .they have ever paid, and the reduction has been from 11-64 cents in 1920 to 5-09 cents solely because of the competition that is provided by Canadians who put their ships on the great lakes.


Edward James Young: Mr. Speaker, the aim of this bill is to give to Canadian ships a monopoly of the carrying of Canadian grain on the great lakes. The minister himself put the situation last night in the statement that "Canadian boats should parry Canadian grain." The effect of this bill, if it becomes law, will be to deprive Canadian grain of the use of Buffalo as a transfer or a storage point. To understand the full effect of that on the transportation of grain, one must have in -mind the picture of the whole grain transportation business. When the first trainload of wheat leaves .the west for .the head of the lakes, those who ship it 
have no idea where it will ultimately land. When that wheat arrives at the terminals, those who own it do not know where it is going to go; it may be sold in any one of a dozen different countries. But one thing .they do know is that that wheat must be kept moving; they know there are millions and hundreds of millions of bushels to follow. They know if it is delayed in the terminals they will fill up, and if they do, the railway yards will be congested, the blockade will go right out to the farms and the wheat will not move. The whole strategy in .moving wheat consists in constantly moving it eastward, but always moving it to a point from which it may be shipped out in the greatest number of directions. That point is Buffalo. It is the .most strategically located point in Canada or the United States for the transfer and storage of grain. From that city you can ship down the St. iLawrence and out through Canadian ports or you can ship down the barge canal or by rail to New York, Boston, Portland or several other United States ports. I ask you, Mr. Speaker, for a moment to picture yourself as an exporter of grain. You discover on a certain morning that you can sell some wheat in Liverpool, some in Bordeaux, Antwerp, Rotterdam or Hamburg. What do you do? The first thing is to see what ocean space you can get. You discover that coming into the port of Montreal is a ship that will load for Liverpool; coming into the port of Portland is a ship that will load, we will say, for Hamburg; coming into the port of Boston there is one that will load for Antwerp and coming into the port of New York is one that will load for Rotterdam and another that will load for Bordeaux. On every one of those ships you can get space. What do you do? If you have your grain at Buffalo you secure the apace and you sell the grain. If your grain is at any other point .than Buffalo you will not be able to deliver at all those ports and you will lose the sale. If you could not get your grain on to any ship loading for Antwerp or Amsterdam or Rotterdam or Hamburg or any other port, you would not be able to make the sale and the result would be that you would sell less grain. If this legislation takes effect, Canadian grain will not be able to go to Buffalo and use that as a transfer or a storage point.


Henry Herbert Stevens: That is not the case at all.


Edward James Young: My hon. friend says that that is not the case. By that he means that Canadian boats can carry grain to Buffalo and Canadian boats can take it from Buffalo down the St. Lawrence.

Canada Shipping Act-Mr. Young


Robert James Manion: Yes, or United States boats can carry it to Buffalo.
(Mr. YOUNG: And carry it out through
United States ports?


Henry Herbert Stevens: Yes, to Rotterdam or any other place.


Edward James Young: The hon. member for Macleod (Mr. Coote) points out that Canadian boats will not take grain to Buffalo because they can get higher rates for taking it to Canadian ports. That precludes the grain from going down the St. Lawrence. In addition to that, the conference agreements passed last fall make it impossible for Canadian grain going through Buffalo to receive the preference.


Henry Herbert Stevens: The hon. member is again absolutely wrong, not within a thousand miles of what is right.


Edward James Young: Canadian grain going out
through United States ports does not receive the preference.


Henry Herbert Stevens: Certainly it does.


Robert James Manion: If it is consigned clear
through to Britain.


Edward James Young: But I say that it is not
consigned clear through. The shipper has to keep his grain moving; he does not know when he loads it on to the boat at the head of the lakes, where it is going. When it is consigned to Buffalo, it is not consigned clear through.


Robert James Manion: Often it is.


Edward James Young: He wants to be able, when
he Ships it to Buffalo, to consign it wherever he can make a sale.


Henry Herbert Stevens: Most of it is consigned
through.


Edward James Young: No, it is not. This legislation will deprive us of the use of Buffalo as a transfer and to a large degree as a storage point.


Mr. SPENCE:: The hon. member knows
better.


Edward James Young: I know what I say. The
minister says that Canadian boats will carry it to Buffalo. The hon. member for Macleod says that they will not because they can get higher rates to Canadian ports. The member for Macleod is right. The average rate from the head of the lakes to bay ports, or to Sarnia or Goderich, last year was 2-08 cents per bushel, while the average rate to
Buffalo, a much longer haul, was 1-577 cents per bushel, or nearly half a cent a bushel lower than the rate to bay ports. Close the port of Buffalo to our wheat; shut United States boats out from the handling of it and that spread will widen; the rates on the lakes to Canadian ports will increase. Who will pay the difference? Everybody knows the price the farmer receives for his wheat is the Liverpool price less the cost of shipping it there. Every cent, every fraction of a cent you add to the cost of putting the wheat on to the Liverpool market is just that much subtracted from the price the farmer receives. What right has anyone to say to the farmer: You must give one cent a bushel more to a shipping man, any more than anyone has the right to say to- the shipping man: You must put your hand into your pocket and give a cent a bushel to the farmer. No government has the right to do that. The hon. member for East Algoma (Mr. Nicholson) said that Canadian boats could not compete with United States boats; they would be driven off the lakes.


George Brecken Nicholson: They can compete on fair terms.


Edward James Young: He said that United States
boats carried some 45,000,000 tons of coal, ore and stone which the Canadian boats could not carry and I thought he said that was carried as return cargoes. It is not; it goes in the same direction as the wheat does.


George Brecken Nicholson: The coal is a return
:argo.


Edward James Young: Why do our Canadian boats not bring coal back? The government does not allow them.


Henry Herbert Stevens: Because we favour the
purchasing of coal from your own riding and a dozen others in the west. That is why.


Edward James Young: Because you have adopted a certain coal policy.


Henry Herbert Stevens: Exactly. Purchasing coal
from your own backyard.


Edward James Young: And you have said to the
boats on the great lakes: "When you take a cargo down, we will not allow you to bring a cargo back. The money you make on the one trip will have to pay for your trip both ways." That is the net result of your policy.


Henry Herbert Stevens: Would the hon. member
permit a question? Would he favour the abandonment of the subventions and support to Alberta and Saskatchewan coal moving

Canada Shipping Act-Mr. Young
eastward in favour of encouraging the purchase of American coal from Port Arthur?


Edward James Young: If my hon. friend had been in the house when the question of subventions was up he would know that I am strongly opposed to these coal subventions from start to finish.


Henry Herbert Stevens: Then the hon. member
would prefer to use American coal in Winnipeg to his own coal.


Edward James Young: I would buy the coal where I can buy to best advantage, and you can trust me to do it. I do not want the government to tell me where to buy it.
The American boats have more business at home and they only enter Canadian trade when the rates are high. When the rates are low the Canadian boats have the trade to themselves. The American boats when they come into the trade are the controlling factor in the rates. Their competition keeps the rates from going out of sight. It has been said that the rates will be regulated. We know that last year the board of grain commissioners fixed the maximum rate at 6| cents a bushel, and we are told that there is a further provision that gives the govemor-in-council power to intervene and set the rates at any time they think the rates are too high. But what has been our experience in the past? Whenever the rates have gone up it takes so long to get action through either channel that the mischief has already been done before action is taken. I give every credit to the board of grain commissioners for the action they took last fall in fixing a maximum rate, but this fact remains that before they fixed it a great deal of the mischief had been done, and as for intervening by order in council that is slower still.


Henry Herbert Stevens: My hon. friend is wrong
again. The board of grain commissioners intervened before the proclaimed rate went into effect.


Edward James Young: WThen did the seven cent
rate go into effect?


Henry Herbert Stevens: That did not go into
effect. It was announced, but the board of grain commissioners stepped in and the rate was fixed at 6i cents.


Edward James Young: I will accept that.


James Langstaff Bowman: And it was fixed without
any complaint.


Edward James Young: From whom?


Mr.   BOWAN@: Without any complaint being lodged with the board of grain commissioners.


Edward James Young: There was considerable complaint in the west, but perhaps no formal complaint, and that may be the weakness of the system. If you wait for someone to make a formal complaint a good deal of the mischief can be done. There was complaint in the west when the rates wore increased and when the price of grain was at the lowest point almost in history.
In the United States in 1880 the freight rate on wheat from Chicago to New York was 20 cents a bushel. Under free competition, open market conditions, that rate gradually worked down till at the turn of the century it was only 10 cents a bushel. Then it worked back and forth within a range of two cents a bushel until rate control became effective in the United States. Prior to 1906 their attempt to control rates had been spasmodic and ineffective. With the passing of the Hepburn Act in 1906, rate control became a reality, and then the decline in freight rates ceased. The rates moved back and forth within a range of two cents until 1916 when the rate shot up to 20 cents a bushel. That was the result of control, and now the rates are controlled by the interstate commerce commission, and the rate is 18 cents a bushel, as compared with 10 cehts before effective control came into force, and 20 cents away back in 1880. They are almost back to where they were forty years ago in the matter of freight, rate. That is the result of attempting to control rates in the United States.
I ask this question:	On what basis are
you going to control rates? Will you regulate them on a cost plus basis? Will you say that the carrier of the grain on the lakes must have all his operating expenses, his depreciation, insurance and everything else, plus a reasonable profit.


Robert James Manion: He has not been getting
that for many years.


Edward James Young: You are talking of controlling rates. Will you regulate them at a figure that will give the ship owner a profit? I ask, then, what right have you to guarantee him a profit more than anybody else? Besides, when you attempt to control rates the controlling body is not in a position and never can be in a position to know when the boats are efficiently managed, or whether the capital structure of the company represents a lot of obsolete and scrap vessels that went out of service long ago. I understand that to-

Canada Slapping Act-Mr. Young
day one of the reasons why Canadian boats cannot compete is that they have a lot of old-fashioned, out of date boats.
The hon. member for Bow River (Mr. Garland) spoke last night of a statutory rate. I do not agree with that. I do not think we should have a statutory rate. It is too rigid. The proper control of rates is free, open competition. I have here a book on the American Transport System by Harold Moulton and associates in which this matter of freight rates is discussed, and he has this to say:
Wherever there is free economic competition it will decide the rate question, and it should be permitted to do so freely.
Free, open competition, yes, not trying to close the market and letting a combine get all the traffic. The American boat now comes into the picture whenever rates are high enough. This is attempting to remove that competition. It is done at the instance of the Associated Lake Freighters mentioned by the minister the other night. Who are these Associated Lake Freighters? I may tell the minister that when we go into committee we will want to know something of that company and its charter. The statement has been made that there is no combine. I say that there is, and we know there is, and we know who is at the head of it. We know the methods to which he resorted to get shipping companies into it, and the fees per bushel he charged for his services. We know that when the combine was organized, rates began to increase and then the board of grain commissioners stepped in and set a maximum rate. When this legislation becomes effective that combine 13 going to ask that control of rates be taken from the board of grain commissioners and given to the board of railway commissioners, because they did not like the action taken last fall by the board of grain commissioners.
The legislation was drafted in fear of retaliation by the United States. I believe that it would 'have been brought in before but there was always the fear that the United States might hit back. At last some clever person, the government leader in the Senate I believe, 'hit upon the device of taking the very words out of the American act and putting them into the Canadian act, aiguing that surely the Americans cannot now retaliate against what we are doing, that they cannot resent these very words in our act which are taken from their own act. But the cases are not quite parallel. There is small temptation for Canadian boats to go into United States ports to carry grain to Canadian ports, and then go back to American
ports, because the ports are not favourably located. The cases are not parallel at all. It may have seemed very clever for the government leader in the Senate to devise this way of drafting the section so that the Americans would not retaliate. I say it may have been a clever trick of a clever man, but I have no faith in clever tricks of clever men as a basis of national prosperity. In trying to build the prosperity of a country you must take the broader and the longer view. Those tactics might be all right for a man running a pawn shop, but they will not do in international relations. The Americans will find a way to retaliate. What will they do to our boats on the Pacific coast running from Seattle to Vancouver and Skagway? Will they not find a way to retaliate? I think they will. To assume 'that simply by taking these words out of their act and putting them in ours we have outwitted them is not to give them credit for being as clever as we are, and I think we might be disappointed.
What about the tariff truce of which we have heard so much lately? A tariff truce has been arranged among the different countries. We are going to get together with the idea of promoting world trade. Is this proper preparation for it? I am not sure of the terms of the truce, and I do not know whether this legislation is a breach of it or not- certainly I do know it is a breach of the spirit of it. It is protection, pure and sr-uple. What about the talk of reciprocity? We are going to have a reciprocity treaty with the United States-perhaps. Is this good preparation for it? In what frame of mind wil the Americans be when they see this legislation on our books? What will they say when we seek more favourable trade relations? What about the seaway treaty? Will the United States enter into a seaway contract if we say we will not allow any American ships through our ports? They do not know what we may do next. Two years ago- nearly three years ago-our Prime Minister went abroad to do wonderful things for trade within the empire. He went to the Imperial conference at London. At that time he failed. A year ago he had another opportunity when the Imperial economic conference met here in Ottawa. We know the results of that.


Richard Bedford Bennett: Hear, hear.


Henry Herbert Stevens: Very tangible results.


Richard Bedford Bennett: Look at the trade returns.


Mr. CASGRAIN:: Look at the pockets of the people.

Canada Shipping Act-Mr. Young


Edward James Young: Now he has another opportunity. He is going to another conference to try to promote world trade. But before he goes he is making a similar preparation,-a preparation similar to that which he made before he went to the Imperial conference in London. Before he went to London he passed legislation which made the conference abortive. Before the conference at Ottawa last year legislation was placed upon our statute books which made it impossible to effect profitable trade arrangements with Great Britain. Now he is going to another conference, but before going he is introducing another measure which will have the effect of giving a monopoly of shipping on Canadian lakes to Canadians.


Mr. ROBINSON:: You want to create a monopoly for American ships.


Edward James Young: No, I am asking only for free competition. That is all we ask. Let the grain be carried by whomsoever can carry it cheapest and most efficiently. There seems to be no limit to the ingenuity displayed by this government in devising ways and means of stifling Canadian trade.


Henry Herbert Stevens: Oh, oh.


Edward James Young: And the strange part of it is that they do it all with the very best of intentions. They think that by this measure they are going to help us. They think they can build up Canadian shipping in this way. No country in the world has been able to build up its shipping industry by means of navigation acts or protective tariffs.


Richard Bedford Bennett: Has the hon. member been reading what the British Shipping Federation has been saying lately about competition?


Edward James Young: No.


Richard Bedford Bennett: If he had he would not now be making such observations about what he calls free competition.


Edward James Young: I am making them, anyway.


Richard Bedford Bennett: Yes.


Henry Herbert Stevens: Everybody out of step
but my boy.


Edward James Young: No country ever succeeded
in building up its shipping by navigation acts such as these. Norway tried it once. Centuries before Columbus discovered America the Scandinavians established colonies on this continent, with which they carried on a profitable shipping business. But what hap-

pened? They passed certain navigation acts which had in view the very purpose behind this bill, namely, to confine shipping to their own nationals. What were the results? They destroyed their colonies-destroyed them completely. England tried to build up her trade in the same way.


Henry Herbert Stevens: She did.


Edward James Young: Let us see what she did.
In the sixteenth and seventeenth centuries she passed her navigation laws. Here is the result.:
Sir Joseph Child in 1690 enumerated fifteen lines of foreign trade which we had lost either wholly or partly through the working of the navigation acts, while the Dutch broadly gained what we had lost.
Then on the next page:
But when we note at the same time that the tonnage of the mercantile marine, estimated on the annual clearances, had risen only from 444,000 in 1714, to 471,000 in 1760, we realize the utter failure of the navigation acts to fulfil their avowed purpose. In the same period the foreign tonnage entering English ports had^ increased more than fourfold, to say nothing of the smuggling mostly done in foreign bottoms.
In other words, the navigation acts, which England had passed for the sole purpose of protecting her shipping and giving to British ships a monopoly of the shipping trade, in forty-six years increased British shipping by three-quarters of one per cent, while foreign shipping into British ports increased by four hundred per cent. How much success did they have? How much success did their navigation laws reveal? I have much more that I could read, but I shall not take the time.


Mr. SPEAKMAN:: You might as well read it.


Edward James Young: All right, I will.


Henry Herbert Stevens: Read some more, it is
really most pleasant reading.


Edward James Young: I know it is pleasant for
my hon. friend.


Sidney Cecil Robinson: And it happened only
about four or five hundred years ago.


Edward James Young: The article is too long to
read, but the substance of it is this: France tried to build up her shipping in the same way, and failed; Venice tried it, and failed; Genoa tried it and failed; the United States tried it and failed. We are trying it and we are going to fail, because you cannot build up a shipping industry in that way. Shipping is the last industry in the world which will

Redistribution Bill
stand a protective tariff. It is the one industry above all other's which must have free, open competition. Something was said a few moments ago by the hon. member for Bow River (Mr. Garland)-


Henry Herbert Stevens: Will the hon. member
permit a question? He has just stated that this measure provides a protective tariff for shipping. There is no protection for shipping, in so far as the great British shipping world is concerned. They all have access to our waters, it is not limited to Canadian ships. The whole British shipping world, the largest entity in the whole shipping industry of the world, has access.


Edward James Young: This, then, is levelled at the ships of one particular country? Is that right? Do I understand that?


Henry Herbert Stevens: No. All foreign shipping is included.'


Edward James Young: All foreign shipping is included,-but it is aimed at the ships of one particular country.


Henry Herbert Stevens: No it is not.


Edward James Young: It is. Last night the minister said that it is the business of parliament to nurture Canadian interests. To nurture them means to feed them. Where will he get the wherewithal to feed them? Is it the business of parliament to take from one man that which he produces and feed it to another? I say it is not. It is the business of parliament to see that every Canadian gets fair play. He is entitled to the thing and he should get the thing that he produces himself.


Henry Herbert Stevens: Hear, hear.


Edward James Young: I cannot support this bill in any shape or form. If it is passed it will result in a monopoly of the trade on the great lakes. That trade will be delivered over into the hands of only Canadians. It will result in higher freight rates. It will result in difficulties in selling our wheat at a time when one of the greatest problems with which we are confronted is that of selling wheat. Because, as I said before, when the grain cannot be shipped from the most satisfactor}^ point, it very often happens that we miss the sale of a consignment. In every way we look at it this bill is unsatisfactory. I do not see how any hon. members from the west can support it. I see that the hon. member for Rosetown (Mr. Loucks) is in his seat. Will he stand up and vote for this bill; will he vote for a bill which will increase the freight rates on grain carried on the lakes?
53719-325	*


Mr. LOUCKS:: I will answer my hon. friend. Yes, I will vote for this bill. I think if the hon. member had heard the Minister of Trade and Commerce last night he must be satisfied that the grain growers in the west have every protection.


Edward James Young: I heard what he said. It will be a very sony day for the hon. member when his people hear about his statement.


William John Loucks: I have no worry at all.


Edward James Young: What about the other members from the west? I do not see how they can vote for this bill. It is class legislation, and is designed to protect a certain class of people doing a certain business on the lakes, people who will be able to put their hands into the pockets of the western farmers, take money out of them and put it into their own pockets. Who is there who will guarantee him a price for his wheat? Nobody does and nobody can. Why then should he be compelled to guarantee profits to anyone else?


Henry Herbert Stevens: No one suggests it.
On motion of Mr. Kennedy (Peace River) the debate was adjourned.



REDISTRIBUTION BILL


Richard Bedford Bennett: Mr. Speaker, with the consent of the house we may perhaps intervene in this debate for the purpose of reverting to the order of presenting reports of standing and select committees. It is quite unusual, and can only be done with the consent of the house.


Right Hon. W. L. MACKENZIE KING (Leader of the Opposition):: What is the purpose?


Richard Bedford Bennett: For the purpose of receiving the report of the select committee dealing wth redistribution.


William Lyon Mackenzie King: Before giving any consent on that point may I ask the Prime Minister what is the intention of the government with respect to the report, once it is brought in? Is it intended to go right on with the bill immediately?


Richard Bedford Bennett: We could not go on until this order of business is disposed of. The purpose of dealing with it at the present moment is that the bill may be distributed. It was suggested after a conference yesterday, that we name two of the older members [DOT]-and I am suggesting that Sir George Perley and Mr. Duranleau should be the two from

Redistribution Bill

this side,-to confer with members who might be named by the leader of the opposition to see if such difficulties as exist in connection with the schedule to the bill can be disposed of. There are not a large number.
This house might then adjourn until three o'clock to-morrow, for the Minister of Marine is in charge of the bill now before the house, and if he continued with that he would not 'have the opportunity to confer. The Postmaster General, as is known, is attending a conference that, under an agreement, I think, was arranged to meet here, I fancy before we came into office. That has to be dealt with. Under these circumstances if the report is presented the consideration of it would go upon the order paper for the next sitting, the bill would be distributed and if it be acceptable to the house, we could adjourn until three o'clock to-morrow to enable this conference to take place.


William Lyon Mackenzie King: Under the rules of the house it would not be possible to proceed with the bill in any event until it had been placed upon the order paper.


Richard Bedford Bennett: Not without consent.


William Lyon Mackenzie King: That woidd have to be given first. I would not feel that we were justified in giving consent until we have had an opportunity of at least looking over the schedules. In the circumstances it would appear to be desirable for the house to adjourn at one o'clock until to-morrow afternoon and in the interval have the conference to which the Prime Minister has referred.
The Prime Minister has mentioned the names of the gentlemen whom he would select. I would name Mr. Lapointe and Mr. Stewart (Edmonton) who are to my immediate right and left, to represent the official opposition. If that is agreeable, I would agree to the suggestion to revert to the order so as to permit the report to be introduced.


Richard Bedford Bennett: Then by consent, I move, -I would associate with me the right hon. gentleman as seconder-that we revert to the order of presenting reports of standing and select committees.


William Lyon Mackenzie King: No, my right hon. friend has placed his faith in majorities, I think he had better hold thereto.


Richard Bedford Bennett: I would still be in a
majority. Seconded, then, by Mr. Stevens.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Hon. H. A. STEWART (Minister of Public Works) presented the second and final report of the special committee as follows:
Your special committee to whom was referred Bill No. 2, an act to readjust the representation in the House of Commons, with instructions to prepare schedules to contain and describe the several electoral divisions entitled to return members to this house and to report the same, now present their second and final report:-
Your committee have prepared the descriptions and the return of members for the several electoral divisions which are set forth in the schedules hereto appended in respect of the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, and Prince Edward Island and the Yukon territory.
The report of your committee is unanimous in so far as the same relates to Prince Edward Island, New Brunswick, Manitoba and the Yukon territory, and, although not unanimous as to the other provinces, represents a very substantial measure of agreement with respect thereto.
Accordingly the committee beg leave to report the said bill.
Mr. LAPOINTE:: May I make a suggestion; I have not seen the bill-


Richard Bedford Bennett: It will be distributed immediately.


Ernest Lapointe: -but I would like to know the population of the new constituencies as determined and fixed by the bill. Would it be possible to have a list of those new constituencies with the population of each new riding described in the schedule so that we may be able to discuss the matter intelligently?


Richard Bedford Bennett: The bill is printed and
will be distributed now. The information the committee had before it will certainly be available to this select four who will try to deal with the problem. I should ask the chairman to make available all the information and maps that the committee had before it, which I believe indicate in approximate figures the population of the new ridings.


Ernest Lapointe: That is what I want.


Mr. GARDINER:: If I may be permitted a word on this matter I also might instance that this is a rather unusual procedure. The proposal is that this house adjourn at one o'clock until three o'clock to-morrow in order that some of the older heads of this house, named by the Prime Minister and the leader of the opposition, may confer together to iron out some of the difficulties that have arisen in the committee dealing with redistribution. It is rather unfortunate that this has

Redistribution Bill
to be done, but inasmuch as it has to be done, I think the suggestion is a very good one. But I think it is unfortunate that the Prime Minister and the leader of the opposition should have agreed on the older heads of this house, because the longer a person remains in this house the more partisan he becomes, consequently the possibility of them accomplishing anything is not very great. The Prime Minister and the leader of the opposition have unfortunately forgotten that there is another section in this house that is as much interested in redistribution as the Conservative party and the Liberal party. If I may be bold enough to make a suggestion it would be that it would be advisable to have a younger head working with the older heads, and he would probably be the balance of power that would accomplish something. Therefore I suggest that we add to that committee Mr. Speakman of Red Deer to represent this corner of the house.


Richard Bedford Bennett: Mr. Speaker, this informal discussion which by consent is being carried on may be all to the advantage of parliament. What we desire to do is to arrive at some fair redistribution of the seats in this dominion that will do violence to the rights of no man. That is the effort. Whether or not it can be accomplished depends largely upon the good will, as the right hon. gentleman opposite said yesterday, of those who comprise this house, having respect always to the fact that the anomalies of the past sometimes have to be undone. That does always create difficulty. Shifting population is always a factor. The hon. member for Acadia (Mr. Gardiner) suggests that one member from that corner of the house might be of assistance on this committee. This small committee has no authority to bind anything. It will endeavour to speak for a party organization to ensure that the arrangements it makes may become effective; that is the position as I understand it. If the hon. member from Acadia, who has a fair mind, believes he can assist in the manner indicated, speaking for myself I shall be glad if he will sit in with the other members of the committee for the purpose of making any suggestions that might lead to that end. Would that be acceptable to my right hon. friend?


William Lyon Mackenzie King: As far as the official opposition is concerned I would be most heartily in accord with having the leader of the Progressive party sit in with the other gentlemen for that purpose. The whole aim, as I understand it, is to arrive at what would 53719-325^
be recognized as fair and just as the result of persuasion and argument rather than of any other power or influence.


Richard Bedford Bennett: Quite so. Then it is understood that between now and to-morrow the small committee representing the parties, Sir George Perley; the Minister of Marine, Mr. Duranleau; the former Minister of Justice, the Hon. Mr. Lapointe; the former Minister of the Interior, the Hon. Mr. Stewart (Edmonton); and Mr. Gardiner, the hon. member for Acadia, shall meet together to see whether some suggestions can be made to obviate the necessity for prolonged and acrimonious discussion with respect to these matters.


Ernest Lapointe: Does the hon. member for Acadia feel equal to the task of representing the younger heads?


Robert Gardiner: As my hon. friend will remember, I did not suggest that in the first place; I suggested the hon. member for Red Deer (Mr. Speakman).


Richard Bedford Bennett: We will take the leader of the party.



ADJOURNMENT-BUSINESS OF THE HOUSE

Richard Bedford Bennett: I move, Mr. Speaker, that the house do now adjourn until to-morrow afternoon at three o'clock, but perhaps someone will move the adjournment of the debate first.


Donald MacBeth Kennedy: I move the adjournment of the debate, Mr. Speaker.
Motion agreed to and the debate adjourned.


Richard Bedford Bennett: I now move that the house adjourn.


Mr. BOULANGER:: I object to the motion for the adjournment of the house.


Mr. SPEAKER:: The motion is not debatable.


Joseph Oscar Lefebre Boulanger: Well, I object. There are many items on the order paper which might be taken up-items in which private members are interested.


Pierre Édouard Blondin: The motion is not debatable. Does the hon. member desire to have a vote?


Joseph Oscar Lefebre Boulanger: Yes.


Pierre Édouard Blondin: All those in favour of the motion will say aye.
514S
Banking and Commerce


Some hon. MEMBERS:: Aye.


Pierre Édouard Blondin: All those opposed to the motion will say nay.


Some hon. MEMBERS:: Nay.


Pierre Édouard Blondin: In my opinion the ayes have it. The motion is carried, and the house stands adjourned until to-morrow afternoon at three o'clock.
Motion agreed to and the house adjourned at 1.05 p.m.
Thursday, May 18, 1933