1935-02-04

Right Hon. R. B. BENNETT (Prime Minister):: In answer to an inquiry by the hon. member for Temiscouata (Mr. Pouliot) I have to advise that the report of the fifteenth assembly of the League of Nations for 1934 was printed in English and French when I tabled copies on January 24 last. I understand there was some delay in the distribution office, but the report had been printed when I laid copies on the table.


Mr. POULIOT:: Thank you.



QUESTIONS

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

Mr. MULOCK:: 1.	What were the quantities of butter
exported to Canada during the years 1931 to 1934, inclusive, by:	(a) New Zealand; (b)
Australia?
2.	What were the prices of the butter each month during the above mentioned years at the Canadian port of entry?
3.	What were the duties, dumping penalty, or other taxation imposed per pound each month during the above period?


Richard Bedford Bennett: There might be a little difficulty in connection with this question. Perhaps the hon. member would change the words "exported to" to "imported into". What may have been exported from these countries and the destination of which may have been changed we could not control, but we can give information as to actual imports into the country.


Mr. MULOCK:: Quite satisfactory.
Question stands.


PROCLAMATION OF STATUTES
Mr. BRASSET:: What are the statutes adopted at the last session which were to come in force on proclamation and which have not yet been proclaimed ?


Richard Bedford Bennett: It has not been usual to ask members of the administration to answer a question of this character which the hon. gentleman can answer for himself, as every member receives copies of the statutes


Mr. SPEAKER:: Dropped.


EMPIRE MIGRATION POLICY
Mr. STEVENS:: 1.	Has the attention of the Prime Minister been drawn to an answer given in the British House of Commons on November 13, 1934, by the Secretary of State for the Dominions to Brig.-General J. J. H. Nation, regarding the empire migration policy?
2.	Did the Prime Minister receive a dispatch from the Secretary of State for the Dominions in regard to the subject?
3.	If so, on what date was such dispatch received ?
4.	Has a reply yet been sent to this dispatch?
5.	If so, will a copy of said dispatch and reply be laid on the table of the house?


Mr. BENNETT:: 1.	Yes.
2.	A dispatch was received from the Secretary of State for Dominion Affairs, transmitting copies of a report of the United
Questions

Kingdom Interdepartmental Committee on Migration Policy and intimating that His Majesty's Government in the United Kingdom had not had an opportunity of considering the report.
A further dispatch was received requesting any observations which His Majesty's government in Canada might wish to make thereon.
3.	On September 14 and November 24, respectively.
4.	The report was referred to the departments interested for consideration fiom the Canadian point of view. The general position of the Canadian government on the' subject of migration had previously been set forth in personal discussions in London. A draft official reply to the second dispatch has been prepared, but has not yet been sent, pending further consideration of the bearing of conditions in the drought area and of urban unemployment upon the possibilities of land settlement and increased migration generally.
5.	In accordance with the usual procedure, the consent of the Secretary of State for Dominion Affairs for tabling his dispatches is being requested, and copies of these dispatches and of the reply of the Canadian government will be furnished as soon as they are available.


SHIPMENTS TO RUSSIA
Mr. POULIOT:: 1.	Does the Post Office Department allow the shipping of goods to Russia by parcel post?
2.	If so, must an invoice be placed in each parcel?
3.	Is it necessary to get a licence from the Soviet authorities for all the parcels shipped in trading with Russia?


Mr. SAUVE:: 1.	Yes-parcel post being routed through England or France.
2 and 3. Yes.



MARKETING ACT

Mr. MACKENZIE (Vancouver):: 1.	What moneys have been expended, if any, by the federal government with respect to the Natural Products Marketing Act?
2.	For what purposes were such moneys, if any, expended?
3.	Have any moneys been expended on the organization of provincial boards?
4.	If so, how much has been expended in each province respectively?


Mr. WEIR (Melfort):: 1.	S3,493.62 as at 31st December, 1934.
2. Communications	$ 191 79
Miscellaneous	 288 25
Materials and supplies.. .. 1,364 08

Salaries	 904 88
Transportation	 744 62



S3,493 62

[Stage Direction]
3.	No.
4.	Answered by No. 3.

Mr. LAURIN:: Did the Quebec government make a formal1 proposal to the federal government looking to an agreement in relation to unemployment with a view to exempt municipalities from contributing to unemployment relief expenditures?'


Mr. GORDON:: Yes.



CATTLE-TUBERCULIN TESTS

Mr. WEIR (Macdonald):: 1.	In what municipalities in Manitoba were tuberculosis tests of cattle made during the year 1934?
2.	What dates were tests started?
3.	What dates were tests completed?
4.	Are any additional municipalities to be tested during the coming year?
5.	If so, what are the names of said municipalities?


Mr. WEIR (Melfort):: 1.	Under the resticted area plan-none.
Individual herds tested under other policies in all parts of Manitoba.
2.	See No. 1.
3.	See No. 1.
4.	Yes.
5.	Morris and Louise.



INCOME AND SALES TAX COLLECTIONS

Mr. SPENCER:: 1.	What was the total amount collected by income tax in the last fiscal year?
2.	How many paid income tax with incomes below the following amounts: (a) $3,000; (b) $20,000; (c) $50,000; (d) all others?
3.	How much was collected by sales tax during the last fiscal year?


Mr. MATTHEWS:: 1.	861,399,171.52.
2.	(a) 93,861.
(b)	75.407.
(c)	2,893.
(d)	1,294.
(Fiscal year 1932-33).
3. Domestic	$54,244,031 52
Importations	 8,979,576 38



EMERY FLEURY

Mr. DUBOIS:: 1.	Is there a man named Emery Fleury, of Saint-Leonard d'Aston, county of Nicolet, in the Department of Agriculture, dairy branch?
2.	If so, what are his duties?
3.	What is his salary?

Questions as Orders for Returns



NATIONAL DEFENCE RELIEF CAMPS

Mr. WEIR (Melfort):: 1.	No.
2 and 3. Answered by No. 1.



YORKTON, SASK., PUBLIC BUILDINGS

Mr. McPHEE:: 1.	In regard to the item of $3,445.45, contained in the estimates as having been expended on repairs to public building in Yorkton; on what building or buildings was this amount *expended ?
2.	To what party or parties was this amount
paid?
3.	Were public tenders called for this work?
4.	If not, who were asked to tender?
5.	What are the names of the tenderers and the amount of their respective tenders?


Mr. STEWART (Leeds):: 1.	An amount of S3,445.45 was expended for repairing and painting the public building under the provisions of the Public Works Construction Act, 1934.
2.	Yorkton Planing Mill (Logan & Black, proprietors).
3.	No.
4.	Logan & Black.
Neelin & McKenzie.
5.	Logan & Black	$3,325
Neelin & McKenzie	 3,525
Note.-The balance ($3,445.45-$3,325.00) or $120.45, covers extra work authorized and carried out by the contractors, Messrs. Logan <fe Black.



UNEMPLOYMENT RELIEF-EXPENDITURE IN ONTARIO

Mr. CAMPBELL:: What amounts were paid to the Department of Highways, Department of Northern Development, Department of Welfare and the Department of Labour of the province of Ontario, for direct relief or for relief projects, during each of the years 1931, 1932, 1933, and 1934?


George Gordon: The amounts paid as at January 31, 1935, to various departments of the government of the province of Ontario, for direct relief and relief projects under the legislation indicated below, are as follows:
The Unemployment and Farm
Relief Act, 1931 and Continuance Act, 1932	$11,133,176	24The	Relief	Act,	1932	
7,891,594	76The	Relief	Act,	1933	
9,878,805	80The	Relief	Act,	1934	
11,906,328	26


Mr. CAMPBELL:: 1.	How many camps under the Department of National Defence unemployment projects are there in the province of Ontario at the present time?
2.	How many men are at present employed
in these camps?	,
3.	How many camps have been closed since September 1, 1934?
4.	How many men were employed on September 1, 1934?


Mr. STIRLING:: .
1. 25.	1
2.	5,569.
3.	13.
4.	4,755.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. REID:: 1.	What was the total amount and values of all gold coin and bullion which left Canada during the calendar years 1930 to 1934, giving the amounts to each country?
2.	Did any of the gold exported during said years go to the Bank of England or any of "the chartered banks in Great Britain?


Mr. CAHAN:: Return tabled herewith.


SOYA BEANS
Mr. GERSHAW:: 1.	What varieties of soya beans are successfully grown on the experimental farms in Canada?
2.	Does the Department of Agriculture recommend the growing of these varieties on irrigated land in southern Alberta?
3.	Is there a market available for this product?


Mr. WEIR (Melfort):: Return tabled herewith.


GASPE COUNTY POST OFFICES
Mr. BRASSET:: 1.	What were the names of all post offices in the county of Gaspe, at January 1, 1930; also the names of the respective postmasters at such date?
2.	What are the names of new post offices established since January 1, 1930?
3.	How many post offices have been closed since such date, and what was the name of each such post office?
4.	What postmasters in the county of Gaspe have been changed since January 1, 1930; what was the reason of each change, and what is the name of the new appointee in each case?


Mr. SAUVE:: Return tabled herewith.
Motions for Papers


WEST CALGARY RECLAMATION WORK
Mr. STEWART (Edmonton):: 1.	Was a contract awarded for reclamation work costing $59,197 to Mannix & Owen, 8th avenue, West Calgary?
2.	If so, was this work publicly advertised in the newspapers and elsewhere?
3.	Who were the persons who tendered and what was the amount of their tenders?


Mr. STEWART (Leeds):: Return tabled herewith.


GLUCOSE, DEXTRINE AND STARCH IMPORTS
Mr. MICHAUD:: 1.	How many pounds of glucose dextrine and starch, respectively, were imported into Canada during each of the years 1930, 1931, 1932, 1933, and 1934?
2.	What was the country of origin of each of said products?
3.	What was the rate of duty, per pound, collected on each of said products?


Charles Hazlitt Cahan: Return tabled herewith.


BOAT LOADINGS
Mr. MICHAUD:: 1.	From May 1, to December 31, 1934, how many boaits loaded and unloaded, at the following places: Bathurst, Campbellton, Dalhousie, Caraquet, Mills Point, Newcastle, Richibucto, New Brunswick and Black Cape. Cape Cove, Carleton, New Carlisle, and Cross Point, Quebec ?
2.	What was the tonnage of each of said boats?



BUTTER IMPORTS

Mr. LAFLECHE:: _ 1- What quantity of butter was imported into Canada from the different countries in 1928, 1929, 1930, 1931, 1932, 1933, and 1934?
2. What duty was imposed on each pound imported, during the years above mentioned?


Mr. HANSON (York-Sunbury):: Return
tabled herewith.



MOTIONS FOR PAPERS


Mr. PERRAS:: For a copy of all petitions, letters, reports of engineers and other documents, in the possession of the Department of Public Works and received during the years 1933 and' 1934, regarding the proposed expenditure of $7,000 on public wharf at Aylmer, county of Wright.



BURRARD DRY DOCK AND SHIPBUILDING COMPANY

Mr. MUNN:: For a copy of the present working contract made by the Vancouver harbour board with the Burrard Dr.vdock and Shipbuilding Company of North Vancouver.
(Mr. Sauve.]



RIVIERE DES ILOTS NEWPORT, QUE., PUBLIC WORKS

Maurice Brasset: For a copy of the paylist in connection with the works done at Riviere des Ilots, at Newport, county of Gaspe, in 1934, supervised by foreman Baptiste Grenier; also a statement of moneys spent for stone and wood in the same undertaking.



NATIONAL DEFENCE-TRANSFER OF T. HARRISON

Milton Neil Campbell: For a copy of all correspondence, telegrams and other documents in the possession of the Department of National Defence, regarding the transfer of T. Harrison, superintendent of camp No. 37, Barriefield to Petawawa, during the year 1934.



MARKETING ACT-POTATOES

Mr. DUFF (for Mr. MacLean):: For a copy of all correspondence, letters, telegrams and other documents that have passed between the government of Canada or the central board appointed under the Natural Products Marketing Act 1934, and any person or persons, provincial governments or incorporated companies, asking for or relating to a scheme for the marketing of potatoes from or in the provinces of Prince Edward Island, Nova Scotia, New Brunswick and/or Ontario, under the Natural Products Marketing Act, since the passing of the said act to date.


Richard Bedford Bennett: This motion might stand as I wish to speak to the hon. member in whose name it stands.
Motion stands.



BUSINESS OF THE HOUSE


Richard Bedford Bennett: Before we proceed to the next order I should like to inform the house that it is my purpose in order that business may be expedited to have printed after each of the resolutions standing in my name on page 12 of the order paper the conventions to which the resolutions refer so that they will appear on the order paper to-morrow with the conventions. I find that only a few copies remain for distribution. This will render it possible for all the members to read the conventions to which reference is made in the resolutions.



NATIONALIZATION OF BANKS


Mr. WILLIAM IRVINE (Wetaskiwin) moved:: That, in the opinion of this house, all banking facilities, including both the chartered banks and the central bank, should be nationalized as speedily as possible.

Nationalization oj Banks
He said: Mr. Speaker, this question of nationalizing the banking facilities of Canada has been put forward in this corner of the house for many years. In fact, I think it was in the first speech that I was ever privileged to make here that I offered the suggestion. Since that date it has been moved or discussed at almost every session since 1922. Perhaps the most notable attempt to have the house adopt this principle was in 1932 when on April 27 of that year a resolution moved from this section was voted upon. I shall have occasion to draw the attention of the house to that discussion later, but my object in making mention of the number of times this question has been discussed is merely to say that I do not propose to cover the old ground of argument. It is sufficient I think to draw the attention of hon. members once more to the main principle involved in the resolution and to seek the endorsation of the house for that principle. The principle of the resolution is that the financial instruments of the nation and the social credit by and through which such instruments operate should not be controlled by individuals for private ends but that currency and credit should be in the hands of the government and administered by a body responsible to the government and to parliament. This principle I venture to suggest is growing in favour.


Pierre Édouard Blondin: Order. I find it just the least bit difficult to hear at this end of the chamber.


William Irvine: The pressure of the tragic effects of the past few years has made some limping minds make haste in regard to their consideration of this question. My conviction is that the Canadian people would very readily endorse this principle were they given an opportunity to vote on it directly. Unfortunately all questions such as this, being included in the programs of the various parties, when they go to the people are entangled by partisan considerations and it is seldom if ever that the people have an opportunity of voting directly on a measure that they might otherwise endorse. If this question were submitted to the people by referendum I would be surprised if this question were submitted to them by referendum if it were not carried by a tremendous majority.
The government of the day has to some extent acknowledged the principle of national ownership. If we take note of the central bank act which was passed last session we shall find that a considerable number of restrictions are placed there against private
operators doing what they please with the national credit, principles of restriction which we do not find in any other bank act which has ever been passed in Canada. This would seem to indicate that the government is well aware that it is not safe to entrust to private corporations without any control by the government, the whole financial structure and facilities of the country. But I would draw the attention of the house to a direct statement made by the Minister of Finance (Mr. Rhodes) when discussing the bill on its second reading. I am quoting from Hansard of 1934, page 826 where the minister, having described the functions of the central bank, made this statement:
It cannot be too strongly emphasized that the exercise of these functions lies outside the power of any single commercial institution or groups of commercial institutions. No purely profit-making institution operating in a competitive system can afford to place social interests before its own in regard to credit policy.
That statement embodies the whole question at issue in the discussion of this resolution. It is frankly there admitted that the very pressure of competition would preclude a private enterprise from taking an unbiased view of certain financial issues. When with that we consider the fact that those who control our banking facilities are in the business for their private profit, we have there an additional reason why they should not be entrusted with the powers which they to-day have both in the central bank and in the chartered banks.
I am glad that the Minister of Finance (Mr. Rhodes) was so explicit in his statement regarding this principle. I regret of course, as I said last year, that the Bank of Canada was not socially or nationally owned at its inception, but although it was not taken over by the government last year I know no good reason why it should not be taken over this year, if the house has changed its opinion. I hope that both the hon. gentlemen to your right, Mr. Speaker, as well as hon. gentlemen to your left, will rise in their seats and vote for this resolution when the time comes. I know that the principle of financial control and ownership by the government has been very strongly advocated by certain left-wing Liberals; I have been much cheered by hearing them advocate it, in the west especially, in the last four years. These left-wing Liberals have advocated the nationalization of finance, and have stated over and over again that that is part of the Liberal policy at this time. I hope that is true. If it is then of course we are going to receive for this resolution to-day
Nationalization oj Banks

much greater support than it has received at any other time in this house. I should like to see this resolution accepted, I hope the government will accept it, but if the government does not accept it I hope that at any rate every hon. member to your left, sir, will support it when the vote is taken.


Mr. HANBURY:: We will not.


William Irvine: An hon. gentleman says he will not. I wish he would write a letter to Mr. Gerry McGeer and tell him that. I wish he would inform the hon. member for Vancouver Centre (Mr. Mackenzie) that he will not vote for this. Then we should at least know where we are and whether the Liberal party does or does not stand for this principle. If nationalization of banking has become a part of the Liberal policy it has been adopted quite recently. Of course, there is no harm in that; I do not see why the Liberal party should not have the privilege of changing its mind, but I refer back to the debate which took place on this very question on June 27, 1932, to which I referred in my opening remarks. At that time the C.C.F. had moved for the nationalization of our banking facilities and the right hon. leader of the opposition (Mr. Mackenzie King), the leader of the Liberal party, had this to say on the subject:
May I in the first instance ask this question of those who have moved this subamendment: If our financial system is to be nationalized, whom are you going to entrust with that work? Are you going to entrust the government opposite with it? Are you going to entrust hon. gentlemen opposite, who have dealt with the tariff in the manner in which they have, under the freedom which has been given them, to nationalize the finances of this country? Yet that is what this amendment is suggesting, because it is addressed to parliament as it exists at the present time. May I ask another question? Were a Liberal administration in office would you entrust a Liberal administration with that task? May I ask still another question? Were you in office yourselves would you undertake the work of nationalizing the finances of the country? I do not believe that any group of persons who have given thought to these matters would attempt a task of that kind in Canada at this time. And, if we ourselves would not undertake a scheme such as this, what would be thought of Canada by other countries if it were announced to-morrow that this House of Commons had attempted any such task as the one indicated in the subamendment?
That was the position taken in 1932, and I have not heard any statement from the leader of the Liberal party in this house contrary to the position he took then. I know he made a statement last year on this issue, which was not as clear as it might have been,

and he quoted it a few days ago in a debate in this house. I shall quote it again. He said:
Liberalism believes that credit is a public matter, not of interest to bankers only, but of direct concern to the average citizen. It stands for the immediate establishment of a properly constituted national central bank, to perform the functions of rediscount, and the control of currency issue, considered in terms of public need. A central bank is necessary to determine the supply of currency in relation to the domestic, social and industrial requirements of the Canadian people; and also to deal with the problems of international commerce and exchange.
In the first part of that statement it seems that the right hon. leader of the opposition was leaning towards the principle of socialization of finance, but I must query the meaning of " a properly constituted national bank." If my memory serves me right the right hon. gentleman gave some explanation last year of what he meant by a national bank, namely, that it should be national in the sense that all stock should be owned by Canadians. That, it is true, is one kind of national bank. Another kind of national bank is one that is just called a national bank. Another kind is a private corporation such as we have in the Bank of Canada, which has been given by this parliament statutory authority to deal with the credit policy of this country. What I would like to know is whether the leader of the opposition meant by this statement that the Liberal party stands for properly con-situted, nationally-owned and nationally-controlled banking and credit facilities in Canada. That is what I should like to be sure about. It seems, I say, that the Liberal party is coming towards the acceptance of that view, and I sincerely hope it is. I know that the left-wingers have come to it. The statement of the leader of the opposition a few days ago, which I have just quoted, would seem to indicate that he has some inclination that way. I am glad to have the opportunity of putting this question before the house in the hope that the Liberal party will rise and vote for this resolution and make it a real issue in Canada. In view of the very general endorsement which the principle has received from the people themselves, in view of the fact that the government in some small measure has recognized the principle involved in this resolution in the restrictions imposed upon the central bank, and in view of the statements of Liberals on the hustings and the rather veiled statement of the leader of the opposition, it would appear that the principle is pretty well accepted that no individual or private
FEBRUARY 4, 193d
Nationalization of Banks
corporation should be entrusted with the management, ownership and control of banking and credit facilities in Canada. If that principle has been as universally adopted as certain statements would indicate, then I see no reason why we should hesitate to take action commensurate with our acceptance of the principle.
The house will note that the resolution calls for the nationalization of financial facilities, which include not only the central bank but the chartered banks of Canada as well. The chartered banks, of course, are the means by which the policy of the central bank may become effective. There is no other machinery and there are no other facilities by means of which the central bank can effect its purpose in the control of credit, and I think the house will agree when I say that the chartered banks have it within their power, if they so desire, to render futile any policy of a nationally owned central bank, so that it would be entirely inadequate and indeed, I would say, foolish for this parliament to stop short of nationalizing the whole financial system. It is not sufficient that we should advocate the socialization of the central bank alone; we must have the socialization of all the facilities that are essential in the handling of our financial system.
We in this corner of the house believe that both the central bank and the chartered banks should be nationally owned and controlled. I am not advocating the taking over of the chartered banks with their capital stocks and their huge, palatial buildings on the most expensive comers of the various cities. I am advocating the nationalization of the facilities, the taking from the bank of the power they now have of dispensing credit. That power was granted to them by an act of this parliament; that power can be taken from them in the same way. As to the details of dealing with them in the taking over process that is a matter of comparatively little consequence. I do not see why the property of the banks should not be treated as the property of any other corporation is treated, which has been superseded by a more effective institution or which has become defunct for any reason whatever. Of course the equipment of the banks may be taken over, if the government needs it, at the replacement value, and probably the banks would be very glad to make any arrangement of that sort. I merely want to indicate that any difficulty which might be encountered with the banks after we had taken out of their hands the facilities which they now administer would be a small matter compared 92582-29
to the great question of the control of credit by the nation in the interests of the people.
Now I should like to spend a few moments on the main object of the nationalization of finance. To nationalize our banking system and to go no further would not help us at all. It will be clear that we could nationalize the banking system and continue the same system that we have now, under national control. That is not the objective we have in view, of course. We ask for the nationalization of our financial facilities because finance must be reorganized on the exclusive basis of public service, and while these institutions are in private hands we are not allowed to reorganize them on that basis. But when we have nationalized them we will have an opportunity to regain access to the social or national credit in order that it may be used properly, scientifically and safely in the interests of the people as a whole. In the next place, if we secure control of these institutions we will be free to reorganize the whole financial structure on a goods and services basis instead of a theoretical metallic basis, which, although largely discarded throughout the world, still limits the operation of finance in this country. I think no one will deny that to-day finance is the most important instrument of reform that the government may find at its hand. Our financial instruments have been and still are handled in a manner which has very effectively defeated the object of industry. Those of us who last year read time and again of the vast quantities of goods destroyed by capitalistic administrators throughout the world, while on the other hand in all those countries there were millions of people in dire need of the very goods so wantonly destroyed realize just how important money is to the economic life of the people. I do not think anyone will deny that if the people had money in their pockets it would not be necessary to destroy much of our goods. I do not think anyone will deny that this is economic waste; it is worse, it is economic insanity for an industrial concern to engage in the production of goods and then proceed to destroy those goods instead of having them go to the consumers, which was the only reason for their production.
I have said that we hope to regain access to social credit. That social credit is the belief in the power of the people of Canada to produce the goods and services that are necessary for the well being of the Canadian people, and the willingness to finance both production and distribution to the extent of our capacity to produce these goods and services. If that financing principle is adopted very soon we

Nationalization of Banks

will find little difficulty with our distribution. To-day our difficulties centre largely around this question of distribution. Behind all financing, is social credit which to-day the banks have sole authority to use t.o any extent they desire or which they may refuse to use if they are so disposed, and for which they do not hesitate to charge the people of Canada a high rate of interest whether it is required for personal use or for social use. That social credit we want to get control of, to take out of the hands of private bankers, whether administered by a central bank or by chartered banks, and to use particularly in the solution of the distribution problem. I believe that there is a tremendous source from which we may draw financial assistance in the distribution of goods. Everyone realizes there is no use in having a well equipped system of production, one capable of producing immense quantities of goods, unless the people are permitted to use it. Whatever theory of economics we may hold I believe all of us must agree that if people have money in their pockets, and if goods are on the shelves of the warehouses of our country, those people will not starve. If we have access to social credit and are in a position to monetize the real wealth created, and find an adequate means by which that may be distributed to the consumer, then we have at least in part solved the greatest and most difficult problem which modern civilization presents. I shall not develop that point any further, for the moment, more than to say that it is with a view to creating a condition whereby the social credit resources of this country may be available to the people themselves, without restrictions imposed either as a result of superstition, the lust for profit or the incapacity of private corporations, that this resolution is moved.
Whether or not hon. members agree with many of the economic views expressed by my associates and myself, I conclude my remarks in the hope they will agree that the nationalization of finance is not only a necessary move but that now is the opportune time to make it, and that it is a move which has become so acceptable to the general public that we need not hesitate voting for its adoption.


Hon. E. N. RHODES (Minister of Finance):: Mr. Speaker, I trust the fact that nobody, except the mover, desires to speak upon the motion does not reflect the views respecting its merits held by hon. members at large. At

all events, I regard the motion as one of great importance, involving as it does an assertion of principle of great national import, and one which obligates me at least to make clear the attitude of the government with respect to it. The resolution in question reads:
That, in the opinion of this house, all hanking facilities, including both the chartered banks and the central bank should be nationalized as speedily as possible.
In other words it asserts the principle that the government of Canada should own, operate and control all our banking facilities. Although that is the most important, in fact the only principle contained in the resolution, the hon. member spent a considerable proportion of his time in a discussion of economics, and a discussion of various systems of banking and financial theories. May I suggest that while such discussion may be interesting, with all due deference it has no bearing upon the resolution. It has to be assumed that the system of banking adopted in this or any other country is that system best designed to serve the purposes of the country and at this stage any attempt to compare the relative merits of this financial or economic system with the merits of other systems is entirely beside the question. I should prefer to deal with the clear assertion of principle outlined in the resolution, namely the nationalization of banks and banking facilities in this country.


Wilfred Hanbury: The socialization.


Edgar Nelson Rhodes: I have noted one reference the hon. member made concerning my observations of last year when moving the resolution which preceded the introduction of the bill to incorporate the Bank of Canada. The words quoted, and to be found at page 826 of Hansard, are as follows:
It cannot be too strongly emphasized that the exercise of these functions lies outside the power of any single commercial institution or group of commercial institutions. No purely profitmaking institution operating in .a competitive system can afford to place social interests before its own in regard to credit policy.
Then, if you please, sir, the hon. member proceeded to draw the conclusion that it followed we must have national ownership and control.
Mr. fIRVINE: I should like to point out that I did not draw that conclusion from this statement. I quoted the minister to show that in that statement he had admitted the principle.

Nationalization oj Banks


Edgar Nelson Rhodes: I certainly accept the statement the hon. member makes, although I clearly drew the inference that he asserted my observation was proof that we must have national ownership and control. I will not admit that the contention of the hon. member is correct, or that he can properly make it. The assertion I made, which I have pleasure in reasserting, has reference to the fact that we required a central bank to exercise those functions, and the manner of the set-up of that bank, the policy adopted in setting it up, the legislation surrounding it and the safeguards with respect to it, are entirely different matters.
The main question is this: Is the central bank as set up capable of performing the functions outlined in the paragraph I have quoted, and to which reference was made by the hon. member. My contention is that all of those safeguards are to be found in the set-up of the central bank, as we have it to-day. I do not purpose covering the ground I traversed either on the occasion of the introduction of the resolution preceding the bill incorporating the Bank of Canada or upon the second reading of the bill. Hon. members who are interested will find my former remarks in volume 1 of Hansard for last session, beginning at page 823. My observations on second reading begin at page 1291 in the second volume.
What does the hon. member mean by nationalization? I take it beyond question that it means complete and unfettered ownership and control and operation.


Wilfred Hanbury: Socialization.


Edgar Nelson Rhodes: Socialization, in other
words, of our banking system, of our whole financial system, including the chartered banks. Let me say just here, lest I forget it, that my hon. friend in discussing the taking over of the chartered banks said this:	I do
not mean that we should take over their enormous capital structure nor their palatial bank buildings; all I mean is that we who legislated these banks into existence shall take over these facilities. Does he mean that he proposes to take over the properties of the banks without compensation? Does he mean compensation or confiscation, because it follows that if his resolution were adopted and the method he proposes were followed we should add to the national debt of this country some hundreds of millions of dollars, and that circumstance must not be lost sight of.
92582-29J
I do not propose, as I said before, to traverse this subject at length, much less do I propose to traverse the whole ground covered in my speeches of last year, but I do desire to emphasize this circumstance, that there is a great deal of loose thought and confusion of mind in many quarters in distinguishing between national ownership, operation and control, on the one hand, and the using of a private instrument, if I may so term it, and setting up a quasi-ipublic trust for the purpose of accomplishing under government supervision the objects we have in mind in operating the Bank of Canada. On that point let me indicate this: While it is true that the capital for the Bank of Canada is provided by the public, it must foe borne in mind that if the government itself provided ail the capital, it in turn would have to borrow that capital from the public, so from that angle it matters not whether you issue bonds bearing 4^ per cent interest or offer stock upon which you pay 4J per cent interest. It is true that the rate of interest varies, but while the maximum amount which will ever be paid to the shareholders of the Bank of Canada is 4-V per cent, it must be borne in mind that we are not far removed from the day when the government itself in borrowing money had to pay more than that to the people of Canada from whom it borrowed it.
In the first place the shares of the Bank of Canada cannot be held directly or indirectly by a bank or any bank director, officer or employee. Second, the stock must be held by British subjects ordinarily resident in Canada, and the holdings under the statute are limited to 50 shares per person; whereas, as a matter of fact, the applications for the shares were so numerous that in order to divide the shares among upwards of 12,000 people who applied for them, the maximum holding is only a fraction of the original limitation imposed.
There is also no voting by proxy, as does take place in the ordinary banks, and which makes voting a perfunctory performance, the proxies being lodged in the hands of nominees prepared by the directors of those institutions. Not that I find fault with that practice; I am merely indicating that even in this respect eveiy safeguard was exercised, as all proxies must pass through the hands of the Minister of Finance who alone is responsible for voting at bank meetings for those who are not able to be present.
Again, the governor, the deputy governor and the assistant deputy governor are in the first instance appointed by the governor in
Nationalization oi Banks

council, and in the case of all subsequent appointments, the appointments must receive the approval of the governor in council.
Furthermore, it will be recalled that there were two important amendments introduced to the bill after it was brought into the house last year. One, which was brought in at the instance of my hon. friend, the financial critic of the opposition, the hon. member for Shel-burne-Yarmouth (Mr. Ralston), provided that the governor or, in his absence or incapacity, the deputy governor, shall have a veto power over any action or decision of the board. That places an enormous responsibility in the hands of the governor, but it does at the same time prevent an undue possibility of control which might not be in the public interest on the part of the board of directors, conceding that such a situation might arise.
The second important amendment adopted was this, that the Deiputy Minister of Finance is ex-officio a member of the board and of the executive committee. That certainly gives as close a contaot between the government and the Bank of Canada as it would be possible to provide, making the government of the day familiar with the whole proceedings and policies and practices of the institution itself.
Then as I have already pointed out it is provided that the returns to the shareholders of the Bank of Canada is limited to a maximum of 41 per cent, and that all profits in excess of that sum revert to the treasury of' the country as provided in the act.
Lastly, but of tremendous importance, is this circumstance, that the by-laws of the board of the Bank of Canada must in all cases before they become operative be approved by order in council.
Now I submit that under these circumstances there is as complete a measure of control as it is possible for a government to have over an institution of this character.
I am not going to traverse the ground that I covered last year indicating why it was that the government had come to the decision that this set-up of the Bank of Canada was preferable in the public interest, other than to say this, that by this method of control we have all the advantages of complete government operation, with none of those numerous disadvantages that would flow if the government attempted to operate a bank of this character subject to those influences, as it would be, I submit with all deference to those who may disagree with me, which I have not the slightest doubt in the world would wreck the institution from the start, if you attempted to run the bank

in the public interest and surrounded by all the deadly dangers which would flow, not so much from the small questions of patronage, but from the larger questions involving the government in questions of bank policy.
I will use the simple illustration that I used last year. We had a condition in 1929 when the world was mad with the imaginary millions it was making out of the inflationary boom which occurred on the stock exchanges of the world at that time. If we had had a Bank of Canada at that day it would have been the bounden duty of the bank to have started a year prior to that time to restrict credit and to curtail it so far as it lies within the power of the central bank to prevent such a perfect maelstrom of inflation and speculation as occurred at that time. What would happen if we had a Bank of Canada owned and operated and controlled by the government of the day in view of the fact that we are only a few months removed from a general election? On the one hand you have the plain duty of the government to apply the brakes. On the other hand, you have the government faced with a general election and faced with a choice which might jeopardize its political future.


Wilfred Hanbury: You might speak for
your own political party.


Edgar Nelson Rhodes: If my hon. friend will be
good enough to rise and ask any questions that he has, I shall endeavour to answer them as best I can. In the meantime, if my hon. friend cares to discuss the question I will listen to him courteously as I would ask him to listen to myself, only asserting the right of any member of parliament to express his views so long as he does so in parliamentary language. Let me say this, in view of his interjection, that when I spoke of government I had no reference to the government of that day; I used the word government in the larger sense, and if it will please the hon. gentleman I will say this to him. Governments are composed of men; they are individuals, they are only human, and there never was and never will be a perfect government in this or any other country in the world. We must take men as we find them, and there would be that irresistible temptation to the government of the day, whether Liberal, Conservative, Cooperative Commonwealth Federation or what not, and the major interests of the country would inevitably suffer under the circumstances I have related. That circumstance

Nationalization oj Banks
alone is sufficient to indicate the force of the argument which we used at that time for the setup of the bank as we find it to-day.
One other thought before I conclude, because I do not intend to discuss this matter at length. Let us assume for the sake of discussion that the Bank of Canada as we have it set up to-day is not the proper type of setup for an institution of that character in Canada. We are a young country, and we are embarking upon a new venture fraught with great possibilities of good, we hope, and possibly of ill, but nevertheless a tremendous venture having regard to the financial future of the country. Is it not the part of wisdom in these circumstances to profit by the experiences of other countries that have traversed the same ground during the last ten or fifteen years which we shall have to traverse in the next ten or twenty? We have not only the consensus of opinion of students of finance but the results of practical experience to teach us almost overwhelmingly the fact that the type of institution which we require is one similar in character to that found in the Bank of Canada-in other words, that we should get away from the type of government owned, controlled and operated institution. Be that as it may, however, we are profiting by the experience of other countries and other peoples in the way in which we have set up this bank. Next year, two years, three years, four years hence, we may find that we have been mistaken. I do not think we shall. But it would be'far wiser for us to profit first by the experience of other countries and secondly by our own experience here before embarking upon a radical policy which runs counter to the experience of other countries in relation to central banking institutions. I leave that thought with the house, whether, we are not wise, now that we have set up a central bank, with its present status approved by parliament, to give that bank a chance to operate, and then we shall have our experience to guide us in the future.
I propose to leave my remarks at that, except to say that for the reasons I have indicated, among numerous others which I might point out; and for the reasons I gave in much more extended form in the two speeches I made, first on the introduction of the resolution and again on the second reading of the bill last year, I would ask the house to reject the motion.


Hon. W. D. EULER (North Waterloo):: May I say at once that I had no intention of taking part in this particular debate but for
some of the statements made by the Minister of Finance (Mr. Rhodes).


Edgar Nelson Rhodes: Naturally.


William Daum Euler: Sometimes,	indeed	rather
frequently, resolutions are brought up in this house with parts of which we may agree and with other parts of which we may not entirely concur, and this is a resolution of that kind. The resolution calls for the nationalization of the Bank of Canada and also for the nationalization of the chartered banks of the country. As the house knows very well, and as I think the country knows, though the people may just as well be reminded of the fact for fear of misrepresentation afterwards, we on this side of the house were last year almost entirely in favour of a publicly owned central bank, though we may not be inclined, at least now-I am speaking for myself-to go as far as the nationalization of the chartered banks of Canada.
In the banking and commerce committee last year, when the renewal of the bank charters was under consideration, and also the formation of a central bank, I heard the Prime Minister say that originally he was in favour of a publicly owned central bank but that upon consideration he felt it was not in the public interest to have a publicly owned institution of that kind. The reasons he gave for that view were startling to myself, because it was a reflection not only upon himself but upon his government, upon members of parliament and upon governments in general. He gave as his reason why the central bank should not be publicly owned the suggestion that it was too dangerous, that governments could not be trusted to administer the affairs of a central bank if it were publicly owned.
With that view I wish to take issue entirely, as I did at the time. We have fifteen or sixteen ministers in charge of portfolios, charged with the responsibility of spending hundreds of millions of dollars each year. I do not think the public is particularly alarmed at any thought that members of parliament, members of the cabinet, are not to be trusted in the administration of the country's business, and I for one wish to take distinct issue with the casting of reflection on governments, even this government, and the suggestion that it could not properly carry out the duties that would devolve upon officials of a central bank merely because a general election was in sight. I am quite willing that the Prime Minister should speak for himself and his government but as an actual fact it is not a fair criticism to make of governments in Canada in general,
Nationalization of Banks

and certainly it is not borne out by the history of governments in this country in the past, no matter what party they represented.
A moment ago I referred to the fact that the bank charters were renewed last year, and this thought occurs to me. Now that we are entering upon certain reform policies, with most of which I am in entire agreement, inasmuch as they accord pretty well with what I have said in the last two years in this house- what I sometimes call my socialistic speeches -and now that there has been a change of heart on the part of this government and more particularly of the Prime Minister, in view of the fact that the government is now practically nationalizing the loan companies in the legislation that has just been brought down and will be brought down, I am wondering whether, if they had experienced this change of heart a year ago, they might not have been in favour of the resolution which is now before us. So much for the central bank.
I w'ant to put myself on record, and I speak for most of my colleagues on this side, that we are still in favour of a publicly owned central bank. I have no such fears as the Minister of Finance has expressed, and other fears perhaps ill founded, that though we have given to what is after all still a privately-owned bank such tremendous powers as we have handed over to the central bank we could not give those powers to a publicly owned bank. I need not refer to all the arguments that have been advanced in this regard. We are handing over all our own gold and all the gold of the chartered banks to this privately-owned bank and the privilege of issuing currency, though not as much as they should have; moreover they have the control of credit in their hands. I for one do not think that power should remain in the hands of a privately-owned bank. I might point out this, as it was done last year I believe more particularly by the hon. member for West Edmonton (Mr. Stewart), that through the creation of a privately-owned central bank we are now actually subtracting from the powers that were formerly exercised by the government of this country. In former days we had under the Finance Act to some extent the credit-issuing power through the treasury board which is really a committee of the cabinet. That power has been taken away from us and been given to a privately-owned central bank.
So far as the chartered banks are concerned may I say this:-I have said it in the house and before the banking committee last year-

the power to issue currency should not remain with the chartered banks and I am sorry that the government, instead of taking only a portion of that authority away from the chartered banks, has not taken the whole of it. As the matter now stands, the chartered banks will be deprived of the privilege-and it is a privilege-of issuing currency during a period of some ten years, but even then they will still have the power to issue currency to the extent of 25 per cent. I would ask the Minister of Finance if I am right.


Edgar Nelson Rhodes: Yes.


William Daum Euler: Personally, I think the government should have gone the whole way and taken the entire power of the issuance of currency away from the chartered banks and given it to the central bank.


Edgar Nelson Rhodes: Will my hon. friend object to one question?


William Daum Euler: No.


Edgar Nelson Rhodes: My hon. friend of course keeps in mind this fact-and I am quite sure he would not wish the question to be a long one-although it is true the 25 per cent will still remain at the time of the next decennial revision, it was left there for the purpose of being dealt with at that period, and he also is aware, I take it, there is no implied suggestion that that should continue.


William Daum Euler: Ten years is a long time and I cannot for the life of me see why if we adopt the principle that the government or the central bank should in future have power to issue currency we should take that power only to a degree and only from year to year. I have never heard any good argument advanced why, if we adopt the principle that that power of issuing currency should be taken away from the chartered banks we should not take it to the full one hundred per cent and I do not think it should take ten years to subtract that authority from the chartered banks.
I did not intend to take up so much of the time of the house and did so for only two reasons: first, the aspersion-and I think I may call it that-which was cast by the Prime Minister and again by the Minister of Finance upon the integrity and strength of character that ought to animate any government that has the interests of the people at heart, in suggesting that they could not properly and honestly administer the functions that naturally belong to a central bank. In the second place I want to put myself on record that I have not retreated and I do not think those on this side have

Nationalization oj Banks
retreated from the position we took last year that we are entirely in favour of a publicly owned and controlled central bank of Canada.


Mr. H. E. SPENCER (Battle River):: I did not rise immediately after the speech of the hon. member for Wetaskiwin (Mr. Irvine) in deference to the Minister of Finance (Mr. Rhodes) who I thought would like to answer directly the statements made by the hon. member. I have listened to the minister with a great deal of interest. I was somewhat surprised to hear him say that the hon. member for Wetasldwin had rather rambled, though he did not use that word, on the various money systems, I thought the hon. member for Wetaskiwin kept fairly close to the present banking system but suggested how it might be used for better purposes. The Minister of Finance spent most of his time in referring to one part of the resolution, that dealing with the central bank. I have no complaint with regard to that except that I believe we would have been very glad had he said something about the possibility of taking over the other banking institutions.
So far as the institution of a central bank is concerned, I think this is a very big step in the right direction; I said so last session. On the motion for third reading I moved a resolution which I will read to the house and although it was defeated, I felt the central bank as placed before us was so much better than no bank at all that I supported the measure on the third reading. On the motion for third reading I moved this amendment:
That the bill be not now read a third time but that it be referred back to the committee of the whole with instructions that they have power to amend so as to provide a stable currency and credit system based on goods and services, limited only to the needs of industry and social services and not by gold; to make available the national credit at cost for governmental services, and so lighten the terrific burden of debt.
Had that been passed I believe we would have been in a better position than we are at present. However it was not passed. The position we were placed in was either to vote against the third reading which would mean that we did not want the bank at all and that we were playing into the hands of commercial banks who did not want a central bank or, on the other hand, to vote for it which would mean that we felt we were taking at least one step in the right direction.
I noticed that the Minister of Finance in referring to the capitalization of the central bank said that practically all the shareholders had was the privilege of supplying the money for its capitalization. He went on to say
that even if the government had subscribed that capital they would have had to borrow the money from the public. Surely the Minister of Finance must think the members of the House of Commons know very little of the money and banking system and of finance when he makes a statement of that sort. He must know quite well-and I am sure he does-that the effect of every bank loan is the means of putting new money into circulation to the amount of the loan. That being so, the government would not have had to borrow money for the capitalization of its bank but would have done exactly as the banks do to-day: when making a loan they would have written that much money into the existing structure based on the credit of this dominion. Before sitting down he made the statement that we must be very careful before starting anything of a radical character. I would like to remind him that nearly every single plank of the new reform program that is being put forward so ably to-day by the Prime Minister and his associates was looked upon for many years, indeed, prior to twelve months ago, as radical measures.


Mr. STEWART (Edmonton):: Which one is radical?


Henry Elvins Spencer: The motion before us calls upon the house to nationalize our banking system. If it were giving every satisfaction, there is no doubt that resolution would not be moved. One reason why the present banking system-and I particularly refer to the private banking system-is not satisfactory is that it is carried on for a profit motive, I have a statement in a very interesting memorandum by the Minister of Finance (Mr. Rhodes) himself, which I think was sent to all hon. members. Referring to the central bank, he said, on page 10:
Definite and drastic limitation of profits removes any possible danger which otherwise might attach to private ownership of shares. The Bank of Canada, however, is an institution expressly created for the purpose of safeguarding the public interest with regard to our monetary and banking system. This feature clearly sets it apart from all ordinary financial enterprises, which, of course, exist for the purpose of making maximum profits for their owners.
That is a statement with which I think we all agree. It is because of that fact, that the private commercial banking system is carried on for profit, for maximum profit, that in many cases it is not carried on in the interest of the people at large. Hon. members know perfectly well, I am sure, that the chief way by which money is put into circulation by the banking institutions is either by making loans
Nationalization oj Banks


Mr. W. A. BEYNON (Moose Jaw):: Mr. Speaker, it was not until I heard the remarks of the hon. member for North Waterloo (Mr. Euler) that I decided to take part in this debate. I enjoy listening to the hon. member, because he always contributes something to the debates of this house. He speaks without passion, and always speaks to the subject under consideration; he is moderate, and usually reasonable. As his reason for speaking this afternoon, however, the hon. member
Nationalization oj Banks

said he felt that he should rescue the reputation of the members of this chamber from what he regarded as the aspersions of the Prime Minister (Mr. Bennett), which were more or less repeated by the Minister of Finance (Mr. Rhodes) this afternoon.
The hon. member for North Waterloo stated that in his opinion the Prime Minister had impugned the honesty and integrity of members of parliament. I was a little disappointed with that remark, because it did not seem up to the usual standard of my hon. friend's addresses in this house. I do not think he intended to be unfair. He may have construed the remarks of the Prime Minister in that way, but I do not think that is a reasonable construction to put upon them. I do not think anything said by the Prime Minister in speaking to us in the railway committee room could be taken for a moment as attributing to members of parliament any lack of honesty or integrity. The Prime Minister was pointing out that in times of abnormal prosperity-


William Daum Euler: He said before an election.


William Addison Beynon: Quite so, but he also said that in a time of abnormal prosperity great pressure is brought to bear upon those who have control of credit and finance. I think we are all agreed as to that. The Prime Minister said that no administration, no matter how honest it might be or how irreproachable its integrity might be, could possibly resist that pressure during a great financial boom. I need only refer to what is known particularly by hon. members from the west, in regard to the local councils; they were actually compelled by public opinion to spend money like drunken sailors when they knew they were doing wrong However public opinion was so strong, people were so optimistic and the boom was at such a height that it wras impossible to resist the pressure.
We have another example of this and in what I am about to say I anticipate hon. gentlemen opposite will think I am trying to be political. I assure them however that I am not. I urge these observations as an extenuation rather than a criticism. At the time this government took office the Canadian National Railways had been subjected to very extensive commitments which, under the circumstances, this government felt were too great. I do not think there is an hon. member on either side of the house who for one moment would impugn the honesty and integrity of the Minister of Railways in the late government. For the time being at any rate he is out of public life and we may speak frankly and freely about him. His honesty

and integrity have never been impugned. But there was a time of great prosperity, and in the very height of the boom the ministry of that day, and the Minister of Railways in particular, could not withstand the pressure. I do not think for one moment the minister entered into the commitments for election purposes. I would not however say that all the members of the Liberal party were as free from that charge. A great deal of pressure was brought to bear upon him by people who for political purposes wanted the commitments, but I would exonerate the minister himself from any such charge. I would not refer to it now, because I do not wish to enter into a political discussion, were it not that it seemed to me a very forceful example of the very thing with which the Prime Minister dealt, an illustration of the tremendous pressure brought to bear when an election is pending and when, as in that case, the world is in a state of boom and prosperity.
I do not think the hon. member for North Waterloo intended to be unfair, but I do say he misconstrued the statement of the Prime Minister. I prefer to hold that belief because I have a very high regard for the hon. gentleman and for his wish to be fair and impartial. I do not think however that for one moment the words of the Prime Minister could be construed as impugning the honesty and integrity of public men. He was sdmiply dealing with facts as he found them, with the fact that these forces are at work and that humanity has its weaknesses. We recognize those fralities not so much in our public men as in the men who send those public men here. That is, if one could have the public act as individuals I do not think the result would be the same; but we are dealing -with mass psychology. That is what governs in times of prosperity and boom, and particularly with an election pending. I do not think it is fair to charge that in anything they have said the Prime Minister or the Minister of Finance impugned the honesty or integrity of public men. I believe they have as much confidence and as much faith in our public men as any hon. member in or any person outside of this house.


Mr. J. S. WOODSWORTH (Winnipeg North Centre):: Mr. Speaker, the hon. member for Moose Jaw (Mr. Beynon) has come to the defence of the Prime Minister. In his radio speeches the Prime Minister has urged the necessity for regulation. He has urged that we have come to the present pass because there has not been proper regulation. May I observe that until the central bank

Nationalization oj Banks
was set up there was very little regulation of the banks, and if we have got into trouble through faulty administration it is not because of the pressure of governments but because of the stupid mistakes of the financiers themselves.
It seems to me the question must be whether we will allow those who have personal interests in these matters to go on in their own way or whether we will put in charge people who are fairly directly responsible to the people. The Prime Minister has been urging reform. I venture to suggest that if instead of bringing in reforms with regard to unemployment insurance he had brought in some reforms to the financial system, such as have been suggested by the hon. member for Wetaskiwin (Mr. Irvine) we would be a great deal nearer the recovery which he has stated is so desirable. Some time during the past fourteen years-


Mr. ARTHURS:: Is the hon. member
opposed to reforms in the social system?


James Shaver Woodsworth: No, but I would
like to get real reforms, far-reaching reforms, fundamental reforms.


Mr. GARLAND (Bow River):: Instead of running up rabbit tracks.


James Shaver Woodsworth: Some hon. members in this corner during the past fourteen years have sometimes found it somewhat difficult to continue putting forward certain proposals which we felt were meeting with very indifferent reception. However I think that within the last few months we have taken courage because we have seen that a Conservative government is at last recognizing that public opinion is supporting the policies we have been setting forth. I do not know how far the Prime Minister himself has thoroughly grasped the significance of some of the statements which he has been making. I venture to say however that had the Prime Minister not recognized the insistent demands of the public for some very great changes in policy we would not have seen the proposals outlined in the speech from the throne at the present session.
I hope the hon. member for North Waterloo (Mr. Euler) speaks for the Liberal party. Some of us have been wanting to know just where that party stands with regard to public ownership and control of the banks. We were not very sure about that when we heard the Prime Minister speaking. I hope the hon. member for North Waterloo spoke not only on his own behalf but on behalf of the whole Liberal party. I am sorry to say several
members of the Liberal party have been going throughout Alberta and British Columbia saying that we in the Cooperative Commonwealth Federation are opposed to public ownership and control of a central bank. I believe it is a rather regrettable circumstance when for party reasons men will descend to misrepresentations of that kind. It is quite true a majority of hon. members in this corner of the chamber voted in favour of the bill. I was one who did, and I have no apologies for so doing. Both in committee and again on the third reading of the bill, we did as we had done on its second reading, namely we did our utmost to get the government to stand for public ownership and control. When we were unsuccessful in getting the government to alter the measure to that extent we were faced with the alternative either of permitting the unrestricted and unregulated private ownership which has existed up to the present, or adopting the bill the government brought down. On the whole I thought it was best to support the bill. I had two reasons for doing so, the first being that I thought it was a step in the right direction. As the minister has said, there is in that legislation a measure of government control. It seemed to me, further, that in years to come it would be a bit of socialistic machinery which might very well be fitted into a larger socialist program. But when we voted in favour of that bill we did not do so because of its private ownership or control features. I think that is abundantly clear to anyone who has known our position in the house during a number of years. I think it was in 1925 that I myself brought in a resolution to the effect that the issuance of currency and the control of credit were functions too important to be left in the hands of private institutions. I believed it then ten years ago, and I believe it just as strongly, if not more strongly to-day.
I am frank to admit that the first steps taken in the organization of the new central bank do not give one a very great deal of confidence in what the future may be. It may be that the board of directors will not have a very great measure of control, but I would remind the house that the board of directors as chosen consists entirely of the slate that was put up by tire chambers of commerce, so that so far as the board of directors have any influence, it is the chambers of commerce bank to-day. I am inclined to think that with the board of directors so nominated, and with the private ownership features, with the governor and his deputies appointed in the way they are, it may very
Nationalization oj Banks

well be that the central bank may fail to function. I say that for two reasons. First of all in stabilizing the general price level very very frequently a central bank is called upon to go absolutely counter to the prevailing trends of the day. When the tendency is towards inflation the bank should take rigid steps to restrict credit. On the contrary, when there is a period of depression they should make money easier. Now when the directorate is composed of men drawn from banking circles, nominees of the chambers of commerce, and when there is a certain amount of private gain involved, I cannot quite see how that bank is likely to go counter to the prevailing tendency of the day.
Further than that it seems to me that the central bank ought to develop some very radical changes in our whole monetary system, but I cannot very well believe that a body so appointed is likely to introduce any very fundamental changes in our monetary system, and without such changes I for one do not believe we are going to get very far.
The resolution as introduced by the hon. member for Wetaskiwin (Mr. Irvine) not only calls for the nationalization of the central bank, but also that all banking facilities, including those of the chartered banks, should be nationalized. Now while the central bank may be able to maintain a general price level -I think that is its fundamental purpose!- I would point out that it is the chartered banks that decide to whom credit shall go. The central bank to a certain extent can determine the volume of credit, but the chartered banks decide whether credit shall go in this direction or in that, whether it shall go to this class of industry or to that, whether it shall be concentrated in the east or go to the west. All that power is to-day still in the hands of the chartered banks, and, Mr. Speaker, I do not think such tremendous power should be left in the hands of private corporations.
We talk about different kinds of money, and their effect. Gold, for instance. We know that is practically negligeble to-day. Then paper currency. A great many of us centre our attention upon that. The Minister of Finance (Mr. Rhodes) to-day pointed out that before very long the central bank will have to issue the greater part of the currency. That is all very well as far as it goes, but as my hon. friend! from Battle River (Mr. Spencer) noted this afternoon, something like 94 per cent of the entire purchasing instniment of this country does not consist of gold or of currency or of subsidiary coin, if you like to put

that in, but rather of certain deposits or loans -credits, if you like to call it that. I noticed a characterization of that kind of money in the annual report of the Bank of Commerce. They used the phrase-money created by trade. I think that a very good phrase- money created by trade. That class of money constitutes the great bulk of the money in circulation to-day, and that class of money is still entirely in the hands of the chartered banks. It is only very indirectly indeed that the central bank can control that class of money. Certainly it does not control the particular avenues through which it will pass. Through interlocking directorates we have the possibility of a very small number of people, a score or more of people, being able very largely to say in what direction the credits of this country shall go. A great many people suggest that the capital held by the chartered banks is widespread. They point out that there is a large number of shareholders, and further, that although the dividends are fairly high they need not be considered exorbitant. But, Mr. Speaker, I submit that the great advantage which the chartered banks possess does not come through the dividends paid to the shareholders. The great power that they have is in being in a position almost to monopolize the credit of the country. That is where they have the advantage. If I were a director of a bank I would not care in the slightest whether I held any stock in the bank or not. My financial success would not be dependent upon the stock in the bank. I would rather utilize my position as a director in order to turn credit here, there or yonder. That is the power the banks have. My hon. friend from Moose Jaw (Mr. Beynon) suggests, men are human. That is true, so human that I think there are very few of them that would not use the credit which they control for their own advantage or for that of their friends. Someone interjects that the bankers are also human. Yes.


An hon. MEMBER:: And politicians.


James Shaver Woodsworth: Politicians are
human too. I do not think they are any more susceptible to influence than the bankers; it is a different kind of influence. What I do object to is the tacit assumption by the Minister of Finance, I think, to-day, and by a great many people of what I might term the divine right of bankers. The Minister of Finance wondered how we could possibly buy out the banks and thought it would almost beggar us to do so. Well, a year ago the banks came to us asking for a renewal of their charters. Supposing that

Nationalization o/ Banks
we in this parliament had simply said to the banks: We shall not renew your charters. I am not suggesting that that would be good policy. I have never put that forward as the policy I would advocate, but I say, suppose this parliament had simply said to the banks: We will not renew your charters. Where would the banks have been? I would like to know what would have been the value of their capital under those conditions, and what would have been the value of their bank premises. I have said before, I do not know whether it was in this house or not, that the bankers have no more moral right to their charters than a peddlar has to his licence, none whatever. If we choose in a little town to take away the pedlar's licence we do not find him going around whining for compensation. We give charters to the banks, or have done so in the past, because we believed that was the best way of administering the credit of this country; but just as soon as we come to the conclusion that it is not the best way of administering the credit of the country, then we are free to adopt whatever method we please. You may say that it is dealing rather hardly with the banks. Well, possibly it may be a hardship; and yet, if I may give another illustration, when some years ago the bartenders had their trade taken away from them, I do not know that there was any particular compensation granted them in consequence. In almost every line of development certain people have been left behind. When the railway came in the stage coach people were left behind and they suffered a good deal of hardship. When the motor cars came along the railway people began to suffer and they are suffering now. And one of these days, I suppose, when the airplane becomes a commercial success it may very well be that those interested in motor cars will suffer hardship. That seems to be the penalty for all progress. Possibly in an ideal state we might see that those people upon whom hardship falls because of progress should be looked after; I would vote for that. But I know that is not so in relation to the labouring classes, who because of improved machinery are turned loose, receiving possibly a little unemployment relief, which is all they get.
I cannot think that the banks have any divine right to what is practically a monopoly, the giving of credit in this country; and it seems to me that, from the way in which they have behaved in the past, it may very well be that we have reached the point where we are free to conclude that there are better
ways of handling credit. The Prime Minister said there was a possibility that politicians or governments would not be able to stand pressure. Well, I would ask whether bankers have been able to stand the pressure. What happened when there was a great deal of gambling going on in the stock exchange in New York? Did not our own banks lend money for gambling purposes on the stock exchange? And what about the pulp and paper industry? Did not the banks, some of the directors of which were financially interested, lend large sums to that industry? Of course. They have not stood the pressure, and I hate to think that they should be elevated to the position in which they are considered and consider themselves so much superior in their judgment and morale to the rest of the people. Not a bit of it.
After all, notwithstanding what was said by the hon. member for Moose Jaw, I submit that the hon. member for North Waterloo is right when he says that the Prime Minister did more or less cast a reflection upon parliament-I think, upon the fundamentals of democracy. If parliament is not the agency through which the rights of the people may be protected and public affairs administered, then let us get rid of parliament and find some better institution. But so long as parliament exists, so long as it even inadequately represents the people, then retain power in parliament. I think we are very well advised to set up commissions which may be to a certain extent removed from the day to day interference of politicians. That may be desirable. For example, I do not know enough about railroading to fuss around and interfere with all the details of railway management; I do not think that can be expected of the ordinary member. But I do think that the great policies of the railways should come before the house; that is another matter. If parliament proves unable to deal with these things, let us get another sort of institution that will more adequately carry out the democratic ideals which we have all cherished.
A great many people think that if we nationalized our banks depositors would lose. I cannot see any need of that. I might remind the house of a little incident of two years ago-I think I have mentioned it here before. In my own province we had a provincial savings office." The premier of Manitoba, rather hard pressed to carry on the business of government, took some of the ready cash for carrying on public affairs and replaced it by provincial bonds. I presume
Nationalization oj Banks

that those bonds would some time have been good, but certainly they were not ready cash, and there was a threatened run on the banks. Mr. Bracken came to the Prime Minister and said, "Will you guarantee our provincial bonds?" The Prime Minister answered, "No, I cannot do that; that is a matter for the banks." Premier Bracken had to go to the banks and they ultimately agreed to take over the savings office, on condition that the government would go out of the savings bank business. Then we called for the papers and we learned that the Prime Minister had given to the banks the guarantees that he had refused to give to the province. I personally learned a great lesson from that. I had a savings bank deposit. When I went back after the session I found the savings office closed; the windows were all shut, the bank having moved out. My desposit however was not lost; I found it in one of the chartered banks, quite safe. Without my knowledge or consent my private account had been transferred from a public savings office to a private chartered bank. I would suggest, as the lesson I have learned, that it is just as easy for an account to be transferred' from a private chartered bank to a public savings bank or a national bank.
I do not need to go over the ground covered by my hon. friend from Wetaskiwin. We in this corner have for years been trying to bring home to this house and the country the necessity for public control over some of our major industries and some of our major utilities. We have been misrepresented and lampooned in every way possible. But whether or not the house understands us, the country is beginning to understand the necessity for something of this kind, and the development in the financial and economic world is forcing the issue. I think we are undoubtedly on the right track when we say that the next step that lies before us, perhaps one of the greatest steps, is the nationalization of our whole financial system. Until we accomplish that we are not in a position to control the industry and the commerce of the country.
I would commend this resolution to the government. It seems to be very much in harmony with some of the fundamental principles stated by the Prime Minister, at any rate those stated in his earlier addresses on the radio.


Charles A. Stewart: My good friend and colleague (Mr. Euler) has put the position of the Liberal party fairly before the house on this important matter. Perhaps I would not have
[Mr. Woodsworth.l
said anything but for the remarks of my hon. friend from Winnipeg North Centre (Mr. Woodsworth) who said that throughout Alberta and British Columbia he was being lampooned-he and his associates -for their action in connection with voting for the central bank. I must confess I am one of those who lampooned him if that is the case, and the explanation given by the hon. member this afternoon has not cleared up the matter so far as I am concerned. I cannot understand their attitude. This may be unfortunate on my part, but if they are opposed not only to the principle of the central bank but to the management and then vote for it and say that they did so on the ground that it is a step in the right direction, then I must be convicted of having misrepresented these hon. gentlemen. This afternoon we have a motion from the same hon. gentleman asking us to support the nationalization of banking in its entirety, taking over the private institutions and nationalizing this very institution that we objected to because it was going to be privately controlled. That also is a change of heart on their part this year.


James Shaver Woodsworth: I feel quite sure
that the hon. member for West Edmonton does not want deliberately to misrepresent us.


Charles A. Stewart: Certainly
not.


James Shaver Woodsworth: In that case I beg him to admit that there has been no change of heart on our part. If he will read Hansard, which shows what we said, he will come to the conclusion that there has been no change of heart whatever.


Charles A. Stewart: I have to
judge individuals not by the statements they make but by the votes they record, and it is upon the recorded vote that I take my stand. I voted against that motion. Had I not done so I should have been subjected to criticism. In the main I am in agreement with the provisions governing the central bank, but I am certainly very far from being in agreement with its ownership and control, and on that ground, as has been stated by the hon. member for North Waterloo (Mr. Euler), I voted against it.
My hon. friend takes the other ground that it was sufficient on his part and that of his colleagues to support the bill on the basis that while discussing the matter on the floor of the house they opposed it. I agree with

Nationalization oj Banks
them in that, but I could not go to the extent of voting for this measure because in my remarks I had opposed it. Either they are wrong or I am, and I do not think I am.


James Shaver Woodsworth: Would the hon.
gentleman permit one other question?


Charles A. Stewart: Certainly;
I will permit a dozen questions.


James Shaver Woodsworth: Suppose the hon.
member voted against the resolution of my colleague the hon. member for Wetaskiwin (Mr. Irvine); would he like us to go throughout the country and say he was opposed to the nationalization of the central bank?


Charles A. Stewart: That is
exactly what my hon. friends will do anyway; I have to take my chance on that. I do not like to insinuate, but I think hon. gentlemen in that corner have found themselves in a somewhat difficult position with reference to their registered vote on this matter. One or two of them at all events felt the same as I did and did not support the government in foisting on this country private ownership of a central bank.
The hon. gentleman also said that their attitude might influence the government in connection with what they were going to do with the bank. The government could have passed that legislation without a single vote being registered from that corner of the house; they did not need my hon. friends' votes to register the popular opinion of this house as indicated by the government majority. I must defend the position I took last summer-and I took it wherever I spoke- that I did not understand the attitude of hon. gentlemen on this question, and I do not yet. I merely say that either I was wrong in registering my vote against the bill, or they must be wrong in the attitude they took.
We still stand, as the hon. member for North Waterloo has indicated, for public ownership and control of this central bank. We believe that is the agency through which we can properly regulate this institution. Hon. gentlemen will disagree, and they have a right, if they see fit, to do so on this particular matter. We feel sufficient control can be exercised over the operations of the private banks to give the people of this country with whom they have business a square deal. I am not even going to blame the private banks for the condition in which we find ourselves to-day. What is the trouble with the Canadian people to-day in common with those of every other country? We have had too much
credit. Neither the members of the government nor the banks can escape this responsibility. Both have been guilty. I have heard the statement-and it is an expression we can all understand-that we spent money like drunken sailors, both governments and banks. Every institution did the same thing until we reached the stage that my hon. friend has so ably depicted this afternoon. We now find ourselves in a very unfortunate position. Let me put my attitude very clearly. I am not going to say that I am opposed to nationalization of banking, but I want first to nationalize the central bank and see how far that control can go. I do not wonder my good friend in believing in what he was voting for last year is disappointed. He freely admits that; he says that there is every evidence of it. The evidence is growing that private control is going to dominate the actions of this institution, and that is exactly what we felt and feared would happen. But at the same time I for one am not in a position to say that nationalization of private banking will cure the situation. The Minister of Finance (Mr. Rhodes) put his finger on the spot when he said:	We are all human
and we are doing the very best we can, what in our judgment is in the best interest for ourselves and for the public whom we serve. I do not believe if we had had our banks nationalized to-day we would have been saved from going into the morass of debt in which we now find ourselves. I can understand a situation where we would abolish interest altogether, what my good friend McGeer calls usury. Then the incentive disappears; this would take money out of the position of being a commodity and we would use it merely as a medium of exchange. I can understand that situation, but to say you are going to permit the usury system to continue and to transfer it from a private corporation to a publicly owned one and thus cure the difficulty in which we find ourselves, is something with respect to which I have very grave doubts, because while different men will be in control they will be human beings just the same.
I do want to be definitely understood as going to the extent of having control exercised publicly, nationally, of the central bank. I will go with my hon. friends a long distance in the way of restraint and restriction upon the operation of private banks. Possibly I will go the whole distance of nationalizing them if it can be demonstrated that the first step is a success and that the second is also a success. It may be all right to transform overnight the whole financial and banking
Nationalization of Banks

institutions of the country from private to public ownership, but I would not care to take such drastic action without a little more consideration than we are giving the matter at the present time. That is the only difference between them and me. We want the central bank to be publicly owned and controlled; we want that step to be taken. I doubt if my hon. friends over there would go to the extent indicated by the resolution moved this afternoon, the complete nationalization of all the banking institutions. I do not believe any system is perfect; I agree with the minister when he says that as long as we have human mentality administering the business of this country, we shall have mistakes. I do not agree that either by private or by public bodies they are made with the intention of having a harmful effect upon the public generally. But mistakes are made, and the government will have the same mentality, whether there is public or private control. But I agree thoroughly with the hon. member for Winnipeg North Centre that the parliament of Canada cannot escape responsibility for the policies which will govern. We have a right to control these institutions which get from parliament the right to do business. In that I am at one with my hon. friends. But I regret that I cannot be with them in their attitude of last session in supporting what I consider a privately owned institution.
I am not going into details as to the central bank itself; I simply content myself with making my position clear on the question immediately before us.


Mr. ANGUS MacINNIS (Vancouver South):: Mr. Speaker, I do not think I have ever ventured to speak in this house before on a question of finance. We have so many financial experts in this corner that perhaps it was not necessary; besides, it is a rather dangerous proceeding for a person like myself. I should not have risen on this occasion had it not been for a statement made by the Minister of Finance (Mr. Rhodes) to the effect that in 1929 we were in a world gone mad. That statement is not very strange in itself, but it is strange if the implication is that we are at the present time in a sane world. In 1929 we had gone mad to the extent that we thought we could all get rich by buying bonds from each other or from the numerous bond salesmen. Now we believe that we must remain poor and in fact suffer privation because we connot find enough money to distribute the commodities that we can produce in such abundance. If the Minister 
of Finance suggests that that is an indication of sanity, then we differ in our definition of sanity.
What is the purpose of the resolution? It is to nationalize the banking facilities of Canada. Why do we want to nationalize the banking facilities of Canada, or what does nationalizing them mean? It means the transfer of the banking facilities from private to social control. It means taking out of the hands of private owners an important factor in production, and vesting the ownership in the community or the state, whichever term you may care to use. Why should we wish to do that? Because we feel to-day-I think everyone, even the Minister of Finance, will admit it; the Prime Minister (Mr. Bennett) has admitted it

that private ownership of the means of production leads to their use for the benefit of the owners always, and not in the interests of the people of the country. All that we are suggesting is that we should transfer these instruments of production and distribution from private ownership and place them in the hands of the community in order that they may be used for social benefit. Is there anything wrong with that? There is no other possible way in which that end can be accomplished except by transfer of ownership.
There is one point on which I think I must differ from the mover of the resolution. He stated that the control of industry by finance prevented industry from fulfilling its purpose. I can see what the hon. member for Wetaski-win (Mr. Irvine) meant by that; he takes it that the purpose of industry is to carry on production, to produce commodities to meet social needs. But that is not in fact the purpose of industry under private ownership. Under private ownership the purpose of industry is to produce property rights for the owners of the means of production. To-day the control of industry and of finance is in the same hands. If we do not use the nationalization of finance as the means of socializing and nationalizing industry we have not accomplished anything by socializing finance.
What gives a bank its value? What gives the Bank of Montreal its value, what gives the Canadian Bank of Commerce or the Royal bank or any bank its value? The fact that the community uses its services; that is what gives it value. If the community ceased to use its services the value of the bank to its shareholders would disappear. It is the community, the social organization of society, that gives to every economic and financial and business organization its value. The

Nationalization oj Banks
moment that institution is transferred into the hands of the community it is of no further value to the interests that formerly owned it, except in so far as they are part of the community; then they obtain value from it only in equal measure with the rest of the community. That is the primary reason why we seek to socialize not only our banking facilities but all our industrial processes as well; for if the community gives the value then the community should own and control and appropriate that value. That is impossible as long as we maintain the present basis of private ownership.
Now may I say a few words in regard to the action of some of us in this corner in voting for the Bank of Canada bill last year. The hon. member for West Edmonton (Mr. Stewart) tried very hard to justify his position, but it was not very convincing to me. The Liberal party, or at least a section of the Liberal party-and I am not sure but that it is only a section that is now advocating national control and ownership of the central bank-had been advocating that for quite a number of years before they came into office. At the Liberal convention of the western provinces, held in Winnipeg in 1917, a resolution was passed unanimously which read as follows:
That, in the opinion of this convention, the time has arrived for the reorganization of the barking system of Canada, so as to bring it more nearly within the democratic spirit of proper regulation and control by the people, and with this object in view, be it resolved

This is what they resolved:
1. The banking system of Canada should be placed under the control and regulation of a banking commission invested with plenary powers in all matters pertaining to banking, currency, coinage and credits, and, in particular, to regulate and control:
(a)	the issues of public currency;
(b)	the coinage of gold and silver;
And so on. That was in 1917. They came into office in 1922 and remained in office until 1930, but not one step was taken to make this policy operative. Furthermore the bank charters came up for revision in 1922. My friends in this corner who were here at that time tried to get the government of that day to put some of these policies into effect. I believe the hon. member for West Edmonton was a member of the government at that time. These are some of the things they were to regulate and control:
(a)	The issues of .public currency.
(b)	The coinage of gold and silver.
(c)	The purchase of bullion produced in Canada.
(d)	The amount of call money loaned outside of Canada.
(e)	Interlocking directorates.
(f)	The supervision of credits.
(g)	The capitalization of banks.
(h)	The payment of dividends.
(i)	The relations of subsidiary trust and money lending concerns to banks.
(j)	And generally, all such matters that are necessarily incident to the proper regulation and control of banking and currency.
I believe the present government have put paragraph (c) into effect. All those other financial activities ran rampant while hon. gentlemen to my right were in office, but not a line was put on the statute books to regulate or control any part of the system.


Mr. DAVIES:: What is my hon. friend
reading from?
Mr. MaoINNIS:	From a copy of the resolution forwarded to me by the man who moved it in committee and later, I think, on the floor of the Liberal convention, held in Winnipeg in 1917.


Some hon. MEMBERS:: Oh, oh.


Angus MacInnis: I do not see why hon.
gentlemen should laugh because this was passed at a Liberal convention held in Winnipeg. The resolution proceeded:
Be it further resolved in connection therewith there should be established a national bank of Canada as a central reserve institution, upon whose board of governors should also sit, amongst others, ex officio, the members of the said banking commission; the objects of said national bank to include inter alia the primary responsibility of marshalling and mobilizing the gold and silver reserves of the nation, and the ownership and' control of the issues of public and national currency.
It seems to me rather late in the day, having had this program before them for seventeen years and having been in office for nine years without doing anything to put it into effect to find fault with those who are seeking to do so.


Mr. VALLANCE:: Was that a federal or
a provincial convention?


Angus MacInnis: That was a convention
of western Liberal delegates. I have no doubt my hon. friend from South Battleford was there.


John Vallance: I can assure my hon.
friend that I was not there.


Angus MacInnis: Then I am sure the convention was that much worse off. When the hon. member for West Edmonton was lampooning and criticizing those of us in this corner during his speaking tours last summer, I

Nationalization of Banks

wondered if he read to his audiences the amendment moved to the central bank bill by the hon. member for Vancouver Centre (Mr. Mackenzie). I should like -to read it to the house once more. This is the amendment moved by those who were in favour of a nationally owned and controlled bank, on the third reading of the central bank bill on June 27 last:
That the bill be not now read a third time but tibait it be refereed back to the committee of the whole with instructions that they have power so to amend it as to provide that the Bank of Canada shall be either,-
(a)	Government owned and controlled;
(b)	Government owned; or
(c)	Government controlled.
Those to my right, Mr. Speaker, may be able to see this with perfect clarity, but I cannot understand what kind of bank the Liberal party really wanted when they moved this amendment. I find that in the first place they are in favour of a government owned and controlled bank. Then, if they cannot have that, they are in favour of a government owned bank and presumably, since the amendment contains nothing to the contrary, a privately controlled bank. Then, if they cannot have a government owned and controlled bank or a bank government owned and privately controlled, they want a bank government controlled and privately owned. The more 1 read this amendment the more I am convinced that they did not know at that time what they really wanted. To support this contention I should like to quote from the speech delivered by the right hon. leader of the opposition (Mr. Mackenzie King) when this amendment was moved. He said:
Speaking for myself, may I repeat that I can see wherein the question of public ownership of a state bank may w'ell be a debatable question. I regard it as debatable for the reason that there is much to be said on both sides.
There you have a perfect reason for refusing to make a decision; because you can eay something on this side and something on that side, because you can say something for it and something against it, when you put both together you stay where you are.


Albert Edward Munn: That is what you did.


Angus MacInnis: No, that was not what
we did.


Albert Edward Munn: You hit on both sides.


Angus MacInnis: We did nothing of the
kind, and let me tell the members of the Liberal party that we now have the national bank bill on the statute book, and it will

require only a minor amendment to make that bank nationally owned and controlled. The point that I took into consideration was this: Suppose my vote would have the effect of preventing the creation of a national bank; would I vote for or against it? It was a step in the right direction; there was at least some control, and all the private bankers in the Dominion of Canada wrere opposed to it, so I supported the bill. My hon. friends to my right talk about the money power, yet they voted directly with those opposed to the central bank, those who wanted to keep the money power in their own hands.
I do not think I need say more on that phase of the matter. All I want my Liberal friends to do, when they go about the country accusing us of supporting this measure, is to read to their audiences the amendment moved by the hon. member for Vancouver Centre. It was not until we in this corner moved a further amendment deleting the alternatives that they were compelled to declare themselves in favour of a nationally owned and controlled bank. These are all matters of record already, Mr. Speaker, but I wished to put them on record again.
I must say that it makes me laugh every time I hear in this house of the dangers of political interference in connection with the central bank. Our bankers raise their hands in holy horror of government ownership and control, for fear of political interference. What do they mean? They just fear that someone else may get a finger In the pie instead of themselves; that is all. They are only afraid that someone else will get a hearing; they have had all the breaks so far, and they are afraid that someone else may get ahead of them. Shortly before I came east I was talking with one of the new members of the provincial legislature of British Columbia. He was elected for the first time in 1934, and he said that what amazed him when he went to the session of the provincial legislature was the number of interests who uvere lobbying the government. He said the mine owners had a lobby and the lumber operators had a lobby. Everyone a person could imagine had a lobby-except the workers and farmers. They did not have lobbies. Of course the bankers have their lobbies and that is the reason they are opposed to political control, to government ownership.
Let me repeat that unless the ownership, the socialization or nationalization of our financial institutions is used as a means of socializing or nationalizing means of production it will not be worth anything to the people of this country. Believing that that

Nationalization oj Banks
is what the hon. member for Wetaskiwia had in mind when he moved the resolution, I am prepared to support it.


Mr. MICHAEL LUCHKOVICH (Vegre-ville):: Mr. Speaker, the remarks of the hon. member for West Edmonton (Mr. Stewart) have led me to believe that the Liberal leopard has not changed its spots, but that in the future it will continue to win its way back into power by stealth, rather than by coming out in the open. The Edmonton Bulletin, of June 30, under the heading, Great Betrayal, declared in its leading editorial that seven United Farmers of Alberta, one Progressive member from Saskatchewan and two Labour members lined up at the eleventh hour with the government policy to vote down the proposal that the central bank be publicly owned. They called it the great betrayal. The hon. member for West Edmonton on many occasions, according to his own word's, referred to the so-called great betrayal of the group sitting in this corner.
So far as I know the leader of the party to which the hon. member for West Edmonton belongs has on no occasion, either in this house or out of it, stated that he was in favour of the nationalization of the banks, or even the nationalization of the central bank. It does not make any difference what the hon. member for West Edmonton or any other member in his party has to say, until we definitely know what the right hon. leader of the opposition has to say about this matter of banking; otherwise whatever the hon. member for West Edmonton has to say will be as sounding brass and tinkling cymbal; for the policy of the leader is the policy of the party. On no occasion have I heard of any alternative policy being offered by the official opposition either in this house or outside of it.
In all his speeches the hon. member for West Edmonton states, "If we get back into power, through the instrumentality of low tariffs, restoring old markets and finding new ones, we will bring back prosperity." And the exuberance, the extraordinary optimism, the extravagant hopefulness he has shown, and that shown by other hon. members behind him, would almost lead one to believe that when the official opposition got into power strawberries would grow on stinkweed, grain on sow thistles, bananas on poplar trees and other luscious fruits on a lot of other obnoxious plants which spread so profusely in western Canada. Such is the dream, but what is the reality? But never mind, O Canadian 92582-304
people; for the wizard leader of the opposition will lull you into sweet and opiate forgetfulness through the policy that the hon. member for West Edmonton has so eloquently promulgated throughout the length and breadth of the land. And when the autocratic Hitler sees the democratic King emerge from the valley wielding the big club of negotiation, fear will seize the great German nation and the hills and the valleys which were made to produce golden grain will go back to producing hops and grapes as before; and the bread that was made to feed German mouths will henceforth be made out of good Canadian wheat. And when 11 Duce hears of the recent provincial victories as well as the federal one he will have a fit of panic before this new international cave man, and shiploads of wheat will wend their way to the land of macaroni and spaghetti as hitherto. And the economically planned United States, seeing the condition of affairs in laissez-faire Canada, when the official opposition gets into power will send aeroplanes into the air which will throw bombs to destroy the artificial barriers existing between Canada and the United States. The French republic, with equal consternation, leaving well enough alone, will employ her farmers in the production oif perfumes, cosmetics, bric-a-brac and other delicatessen instead of letting them produce grain. That is the impression they intended to create throughout the west, and that is the impression the hon. member for West Edmonton has often tried to create right here in this house. There is no question about that.
So far as the resolution moved by the hon. member for Vancouver Centre (Mr. Mackenzie) is concerned there can be no doubt about its alphabetic stupidity. It was no doubt drafted with the feeling that it might be heaven, hell or purgatory that his party would share, so he thought it very well to make friends everywhere. I did not intend to speak on this motion, but it would seem that to-day we appear to be running in a circle. One hon. member will get up and say, "Well, I would not have spoken had it not been for the hon. member who preceded me." I am afraid I am in the same position as three or four other hon. members who have just spoken about this banking question.
Yes, I was one who voted for the central bank last year, and I do not care whether a hundred members for West Edmonton go into the Vegreville constituency to decry the facts; I am quite prepared to tell the people in Vegreville why I voted, how I voted and
Nationalization oj Banks

where I voted. There is no doubt that the ventral bank can foe made nationally owned at any- time, and if the official opposition gets into power, as the seer, the dean and the patriarch of the house, the member for Labelle (Mr. Bourassa) predicted only a few days ago, and if they are serious about making the central bank a national bank, I shall be prepared to give them not only one vote but, if I had them, one hundred votes.
Mr. JEAN-FRANCOIS POULIOT (Temis-oouata): Mr. Speaker, I have just listened to the speech of the hon. member for Vegre-ville (Mr. Luchkovich). He has not answered the question I put to the Cooperative Commonwealth Federation two years ago, namely in February, 1933, concerning the nationalization of the banks. If you, sir, would kindly allow me to adjourn this debate until eight o'clock I would have sufficient time to get Hansard of 1933 and read those questions to the members in the corner of the house, and in that way we would learn whether or not they are ready to answer them.
This is no time to make jokes about macaroni, spaghetti, sausages, delicatessen and so on. If the hon. member's stomach is empty, then he may go to dinner and have sausages, macaroni, spaghetti, tripe, gravy and anything like that. Let him eat pork, beef, or what he will; but that is no argument upon which to exercise one's brains. I expected some thought to come from so genial an hon. gentleman, but what did we have? We had a most indigestible menu, something that one could not eat, even with H.P. sauce. He recites the bill of fare in the midst of a dignified discussion of one of the most important problems of the day. We have these gentlemen with us who say: Let us nationalize the banks, nationalize the deposits which have been entrusted to the banks by the people of this country. Sir this is a matter of great concern to everyone who has a dollar in the banks. Would it be any better if the state owned and controlled all the money which has been deposited in the chartered banks of this country? That is the question, and it is one of momentous importance. It has already been discussed in this house, and discussed throughout the country. Not later than last fall there was a by-election in the city of Toronto, and a gentleman whom I know well was a candidate of the group who sit in the extreme left comer of this house. What was the result when the matter was submitted to the intelligent people of Toronto? It was this: the man who was the candidate of that group

or party to my left, call them what you like, got a minority vote, but his minority vote helped to elect the Tory candidate.
There is one difference only between the Prime Minister (Mr. Bennett) and the leader of the Cooperative Commonwealth Federation group (Mr. Woodsworth); one is clean-shaven and the other is not. That is the only difference between the hon. member for Winnipeg North Centre (Mr. Woodsworth) and the hon. member for West Calgary (Mr. Bennett). Two years ago in the month of February I asked fifty-five questions of the hon. gentleman who sits to my left, and I got no reply from any of them. They were all dumb-just as dumb as if they were ministers of the crown. No answer; and now the only answer we get, after two years in which they have had time enough to think over the matter, is jokes like those we have just heard or invective against one or other of the parties in this house. They cannot answer the questions that I asked, questions which were based on their program; and instead we hear jokes. It is all right, sir, to promise the moon. It is all right to say that someone will go up into the sky-the sky is the limit-and bring down the stars and offer them to the hon. member for Vegreville, but I say to the hon. member for Vegreville: while he may be a star, he is not a star from heaven, judging by the materialistic speech which I have just heard him deliver. It proved quite otherwise.
Do you believe, Mr. Speaker, that the widow with all her savings in the bank would agree to the nationalization of the banks, would agree to having her all which she has put in the bank controlled by such a gentleman as the hon. member for Vegreville, or by such an economist as the hon. mover of this resolution (Mr. Irvine), or by other gentlemen of that group? Their minds are full of theories from people who have had no practical experience. As I said last year to the house, everything that is written has their respect; they worship type. Their hero is Gutenberg, the inventor of printing. I am sure that they must meet in the cellar of a printing house. They do not admit anything that is the subject of discussion. They believe only in type and in what is typeset, and they upset us with that, sometimes. They are not serious. They think they are serious but they are not. What they say is incredible, impracticable, unrealizable, and they know it. If they do not know it, I am sorry for them. It is always the same story with them. The state must take control of

Nationalization oj Banks
all the wealth of Canada because one day they hope to take power and use it for the great benefit of this country. That is their utopia-a utopian thought for them to think the people of this country will put them into power. But, Mr. Speaker, my electors are soundminded; the electors of any constituency are soundminded, and surely these hon. gentlemen to my left were not elected on speeches like the one we have just heard. No elector in this country would take seriously a man who speaks of such an important matter in such a childish way. He proves only one thing, that he does not at all realize the importance of the subject he is discussing, and I can only feel sorry for him.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Jean-François Pouliot: The resolution before us reads:
That, in the opinion of this house, all banking facilities, including both the chartered banks and the central bank, should be nationalized as speedily as possible.
I told my hon. friend from Vegreville that he had great respect for books and typewritten matter and for that reason I bring to the house to-night a big book in which I find fifty-five questions which have been put to the Cooperative Commonwealth Federation in this house. These questions were put to them two years ago and have not yet been answered. One quotation from their sublime orations is this:
Major services and utilities and such productive and distributive enterprises as can be conducted most efficiently when owned in common (should be owned-and controlled) by public corporations responsible to the people's elected representatives.
On this, the following question was asked:
What would happen: (a) to the amounts of money deposited in chartered banks by private individuals; and (b) to life insurance held by them?
There are two motions relating to the Cooperative Commonwealth Federation and appearing on to-day's order paper-one already mentioned and another one in the name of the hon. member for Winnipeg North Centre (Mr. Woodsworth) in which he summarizes the program of his group. There is also one in the name of the hon. member for Peace River (Mr. Kennedy) with regard to the Peace River railway.
It would be rather difficult for me to read the fifty-five questions already put to the Cooperative Commonwealth Federation group two years ago, but I have read one. There are many others however which I think should be read to the leader of that group when his resolution comes up. But let me tell my hon. friend in the faraway corner how I understand the learning of the banking business from the point of view of members of parliament. The first thing would be to read the old Bank Act and the amending act of last year and to compare the two. This is elementary; it is the basis of learning. They would learn much more about Canadian banking by reading the laws which they have helped to pass than by reading Sir Arthur Salter's great, theory of banking, or Schatt's theories, or the theories expounded by all the learned economists who know nothing about the laws which have been enacted in this country by all of us, including the hon. member who has not time to read the legislation which he himself has voted upon. It would also be very useful to my hon. friends

it would complete their education in this matter-to read the annual reports of the banks published in every daily newspaper as well as in the Canada Year Book, which was distributed free to us in years gone by. Another most interesting publication in regard to banking in this country is the Canada Gazette. I would suggest to my hon. friends that they also read the reports published by the Department of Finance showing the amount of money in the banks, in savings accounts, current accounts and so on. If my hon. friends can spare a moment from their scientific experiments in connection with foreign bankers, I commend to them very highly, first, the reading of our own bank acts and a comparison of them, then the annual reports of the banks, which are available to all and are published in the newspapers-if they asked the general managers of the banks for these reports I am sure they would receive them-then the official gazette, which comes from the king's printer. There are also reports each month under the signature of the Minister of Finance and they too are most interesting. If they will look at the last annual report tabled at the opening of this session by the Minister of Finance, they will find it very instructive. They should read all these reports going back to confederation and learn them by heart; I am sure they would enjoy reading them.
These various publications form the basis of banking knowledge, and though one may forget the exact figures one will remember in the main what has been said by these leading bankers. There is one thing which my hon. friends have discussed from a different
Nationalization oj Banks

angle, and that is reduction in the rate of interest. I did not listen to their speeches this afternoon because I know it is always the same story-they ask for a reduction in the rate of interest. A distinction should be drawn. There was a reduction of one-half of one per cent in the rate of interest the year before last, and last year another one-half of one per cent. Why? Was it at the request of the people at large in this country? Was it at the request of those who deposited tnoney in the banks? It was not the request of the depositors but at the request of the bankers themselves. They took advantage of what had been said by my hon. friends at the extreme left of the house, to come and tell the government that it was most important to have a reduction in the rate of interest on deposits in order to give an opportunity to the banks to make credit more available. If my hon. friends will look into the annual reports of the banks, the official gazette, and the monthly reports of the Minister of Finance, they will see that the amount of savings in the chartered banks at the present time is about the same as it was five years ago, with the exception that there is a little more inflated money in circulation now, at their request, than before. It is nearly the same amount of money, but the interest rate has been cut by one-third. What was the amount that was in the savings accounts in the chartered banks? It was 81,400,000,000. My hon. friends know that very well. One per cent on that amount is 814,000,000; the first cut of one-half of one per cent meant $7,000,000, and another similar cut followed. To cover their losses, the banks took advantage of what was said by my hon. friends to bring pressure to bear on the government- the Minister of Finance will not deny this because it is the fact-to allow them to pay less to the depositors. The result is that that amount, the difference in the rate of interest, has not been given to the customers of the banks, the depositors; it has been kept by the banks themselves to cover their losses. My hon. friends know very well; it is public knowledge, that when a bank lent $12,000,000 on a man's own signature some years ago, that man never paid back to the bank what he got from it. The reduction in the rate of interest has been enjoyed by the bank, and its customers, the depositors, have suffered an equal loss.
Is the government adopting the policy of the Cooperative Commonwealth Federation- no profit? Does the government intend to curtail that very legitimate profit that comes from the rate of interest on deposits made

in the chartered banks? When I said that there was only this difference between the Prime Minister and the leader of the Cooperative Commonwealth Federation, that the Prime Minister was clean-shaven and the other was not, I think I was right. I am not saying that as a joke; I say that seriously because they have arrived at the same conclusion. We hear the Prime Minister repeating all the time: Our banks are safe; they are solid; we have nothing to fear about the future of our banks. That is all right. It is why people invested their money in the banks. But if, owing to the reduction in the rate of interest, this brings people no legitimate profit, they will take their money out of the banks and put it into unsound investments to get supposedly easy money, to make easy profits, and then, as has happened in the past, they will lose their money.
A tremendous responsibility rests upon the shoulders of the Minister of Finance. He was in the chamber a minute ago; I am sorry he has left. By virtue of the old Bank Act he had all the power that is now given to the central bank to control banking in general in this country. He could make every bank tremble; he was boss of finance. I remember very well-and every member should remember this-that not long after the minister had been sworn in as minister of finance, someone from this side of the house asked him about a change, saying: What is the reason for that change? The minister's answer was: I have been advised so and so by the officials of my department. I did not say anything at the time but I was very sorry for the hon. gentleman, for whom I have a great regard, that he could not give a better answer to the house. What was his answer? It was: "I do not know; the officers of my department do that." Are we to live any more in such a state of bureaucracy? Is a minister of the crown to be led by third-rate clerks in his department? Every time a question of such importance as that is asked, we are answered with a smile. A smile is a nice thing, but from a minister of the crown it is no answer. I am sorry to say this because I have a high regard and respect for the hon. gentleman, but apparently he has not studied the whole matter so as to be able to give a satisfactory answer to members of parliament.
Let me go further. In a most interesting report published in December, I see that the general manager of one of the banks said: We are generous; we pay much more interest to the depositors than we pay to the shareholders. Is it possible that people can say

Nationalization of Banks
such a thing as that? That man should know; everyone knows that the number of shareholders is much less than that of depositors. On the other hand the rate of interest paid to the depositors is only two per cent while the rate paid to shareholders is twelve per cent. I do not put the blame only on the Minister of Finance; I put it on the whole government for letting men of outstanding character in this country make such silly statements in order to deceive the people. This will cause more prejudice against the bankers than even the losses sustained by the banks, because people will say: men like that are not serious.
Is it necessary to nationalize our banks? I do not believe so. I believe in the old order; I believe the act was well enough drafted to permit the Minister of Finance to have absolute control over the banks. He had the power to send in his inspectors to check the banking, to know what was going on, to check the collateral securities. Is it because the minister and the government were afraid to take such a step that they created that new organization which is called the central bank? I have been in the main at one with the policy of my party, but in my humble opinion the fact that the minister did not take the responsibility that he should with regard to banking is the reason why the central bank was necessary; it was necessary because the minister was saying in the house that he was acting in accordance with the views of the officers of his department and also because he did not and the government did not dare to take the responsibility of checking those sharks of finance that we have in Montreal and Toronto and of whom everyone knows. That was the point. Is it fair, because a man has got under false pretences a sum of $12,000,000 from the banks; is it fair because bankers lacked judgment in lending so much money to him, that all the depositors in the banks should have first one-half of one per cent and later one per cent less interest in order to cover the banks' losses and the shareholders receive twelve per cent while the depositors get only two per cent? Is that fair? Is it just? When the Prime Minister comes along afterwards and says: Our institutions are sound. He says, "Ready, aye, ready," when they come to him for such favours. The shareholders are the privileged few; they get the high rate of interest of twelve per cent, and in order that the banks might continue to pay that twelve per cent to the shareholders the government, after hearing what the Cooperative Commonwealth Federation group said in this house and outside, reduced the rate of interest paid to the farmers, paid to widows, paid to
men in industry, paid to anyone who has a dollar in the bank. First they reduced it by half of one per cent, and then to two per cent. The indictment should not be against the bankers; it should be against those who sit on the treasury benches and who have not the courage, have not the guts to stop the bankers from exploiting the people and doing things like that. The responsibility lies with them. When the Prime Minister says our system has a sound foundation, his very acts are the dynamite that blows up that foundation of confidence in our institutions. That is why I regret the step which has been taken by this government, which cannot be justified either before this house or before the electorate of this country. It is not for me to give names; everyone knows about it. The shareholders of the banks get a rate of interest of twelve per cent; the depositors get two per cent, and it may go down to one and a half per cent or to nothing -no profit, the Cooperative Commonwealth theory. The Cooperative Commonwealth Federation and the government will kiss each other and not be ashamed of themselves. They will be able to say: We are going to socialize now; the government have adopted socialist views, thus destroying the confidence of our people in our institutions, depriving the people of legitimate income and exposing them to the lure of unsound investments because they cannot get reasonable interest from the banks. This is the wonderful situation we have just a year after the last revision of the Bank Act.
Let me tell my hon. friends in the corner one thing. I am friendly with them; I have some very dear friends among them, and they know that. I have friends everywhere in the house. I see them now smiling.


William Duff: Beware the Greeks bearing
gifts.


Jean-François Pouliot: Let me tell them they
would be much more interesting and would carry more weight if they based their arguments on facts found in the blueboolcs and the official publications. Instead of giving us the views of Sir Arthur Salter or Sir Josiah Stamp or any foreigner, let them give us their own views, as other members do.
I hope, after what has been said from this place in the house, that the government will understand that they are taking the wrong way when they accede to the requests of the bankers for reduction in the rate of interest on deposits. I hope that very soon the former rate of interest of three per cent on deposits in savings accounts will be restored
Nationalization oj Banks

in order that the people will have more purchasing power. My hon. friends complain that trade is poor because people have no money to buy. The purchasing power of many people is curtailed to a large extent on account of that reduction in the rate of interest on savings deposits.
May I tell my hon. friends one thing more? It is that they should not try to impress us with words. They would impress us more with sound arguments. And let me ask any one of my hon. friends who sits in the government benches to tell the Prime Minister and the Minister of Finance that before they accede to the requests of the bankers for a further reduction in the rate of interest to cover losses sustained by the banks they should listen to the views of the depositors. As the government has been told the truth I hope that in the future such a thing will not happen again.
I am glad to see my hon. friend the Minister of Finance returning to his seat now. I was about to conclude my speech; I have just a word to say to him. He knows I have regard for him, but what I was very sorry for was the reduction in the rate of interest paid by the banks to depositors. The minister knows that the depositors get only two per cent, while the shareholders get twelve per cent. The depositors had their rate of interest cut from three to two per cent, while the shareholders had twelve per cent. I said the bankers went to him in his own office to ask a reduction in the rate of interest, taking advantage of what was said by the Cooperative Commonwealth Federation, and thus the bankers saved $14,000,000 last year. I said that before the minister was here; I repeat it now he is back in his seat. Last year, in reply to a question put by an hon. member on this side as to why such a change was made, I repeat the following answer was given:	"It was recommended by
the officials of my department." Surely the minister was not serious in that. He should be the boss; he could make the banks tremble. He was the boss under the old legislation. Because a thing is recommended by a third-rate clerk is no reason why it should be acceptable in the national interest. Let him use his own judgment; it is much better than the opinion of his clerks. They may give him information and facts; that is all right, but he should draw his own conclusions, in order to be able to defend his policy in this house. This is most important. I do not say that in an offensive way, but it could not be repeated too often. May I tell him also that I regret very much that we have now a central bank,

for this reason; that before, under the old act, the minister had all power; he could send the inspectors of his department to every bank to check what was done. Will it be so easy for him to do that now? The central bank was first asked for by hon. members on the extreme left for the purpose of getting easy credit. But that proved to be impossible. It is now being looked upon not as a source of credit but only as a means of control, because the Minister of Finance did not take advantage of the control he had at his disposal.


Mr. ALFRED SPEAKMAN (Red Deer):: Mr. Speaker, it is I think unnecessary, and certainly it is far from my intention, that I should discuss at any length the provisions and meaning of the resolution now before the house. Those provisions and that meaning have been discussed and amplified this afternoon by men more competent than I to discuss such matters. It might not be out of place, however, for me to suggest that if the principle upon which this resolution is based is accepted by the house or by any part of the house, then the resolution itself, in terms, becomes essentially logical, and its logic is inescapable.
The principle, as I see it, is that finance, using the word in its widest possible sense and with all its implications, should be considered rather as a public utility than as a private industry, that it should be operated and controlled by the state for the use and the good of all the people within the state rather than operated and controlled by individuals or groups of individuals for theii private profit. If this principle is accepted then I think it must follow as an inescapable conclusion, Mr. Speaker, that in order to put this principle into effect the instruments through which the principle is applied and the medium through which finance is controlled and distributed also should be under the complete ownership and control of the people of this country. I think no one in this house would suggest that in the case of the water supply, say, of some great municipality such as Ottawa, the water itself should be considered a public utility and that it should be the duty of the municipality to furnish that water in ample quantity and of clear and excellent quality to all the citizens, yet that the municipality should permit the machinery and the pipes conveying that water to the citizens to be owned and controlled by private individuals for their private profit. To my mind the cases, while not wholly similar, certainly are somewhat analogous. And that

Nationalization oj Banks
principle, Mr. Speaker, which for many years has been urged from this corner of the house, which has come to be looked upon with favour by a large percentage of the people of Canada and which has been finally accepted by the Liberal party, I believe is a principle which should be endorsed by this house and, if endorsed, should be carried into effect by the acceptance and carrying out of this resolution.
I did not rise, however, so much to discuss the resolution itself as to make some comment on what has been said by others. In this I am in somewhat the same position as others who have spoken, many of whom have stated that they had not intended to speak but that some remarks made by other members had forced them to their feet. I find myself somewhat in that position; it was largely because of certain remarks made by the hon. member for West Edmonton (Mr. Stewart) that I rose to-night. When the hon. member spoke I noted that he was inclined to be, I shall not say indignant but surprised, grieved and a little disappointed at the vote cast by the majority of the members in this comer of the house last session in respect of the central bank bill. I was not surprised at the hon. gentleman's attitude. In the first place he has not had the advantage we in this corner have had, of sitting as a minority group in this house during nine years of Liberal and four years of Conservative rule; he has not been taught by long and bitter experience the great necessity of toleration and some degree of willingness to accept half a loaf rather than have no bread. During all these years we have learned that such is the case; we would have made no progress and nothing would have been accomplished had we not been ready to go step by step, taking each time the step which might be taken, hoping it would lead to better things, insisting only that the step should be such as would truly lead onward rather than backward. Again I was not surprised because history will show, and experience has taught, that there is no zealot so intolerant and uncompromising in his zeal as the recent convert. We have all met with and experienced this situation, that the man who rushes forward, offering you no alternative save the koran or the sword, that you must believe with him or perish, is the man who only recently has seen the light. Under such circumstances it is usual for those zealous for the truth to insist that no compromise is possible, that no jot or title of the truth, the whole truth, must be pared away, but that we must accept every single beauty in that Mohammedan
paradise if we are to go to paradise at all; that no diminution in that harem must be permitted but that the entity, in all its perfection, must be accepted or rejected as the case may be.
That has not been our course, Mr. Speaker; as I have suggested before, had that been our course such progress as has been made in the past would have been impossible. Last year when we reached the time for the final vote to be taken on the third reading of the central bank bill; when all amendments had to be discarded and all alternatives left aside; when we came to the point that we must vote for a central bank, privately owned indeed but largely publicly controlled, or vote against it and in favour of retaining the system exactly as it was before, we believed our course was clear. Generally speaking, we would not take the course which I suggested was consciously or unconsciously the course of those who opposed that legislation, of aligning ourselves consciously or unconsciously with every force and every interest in this country that has continuously opposed the idea of any state control, any centralized authority, or any central bank of any kind. We believe this is a step forward, as we believe that legislation was a step forward. We believed not only that the immediate situation would be improved but that, in that improvement, we would have created the machinery, wTith centralized control and authority, which at any time at the will of this parliament might be converted into an entirely publicly owned institution. I can only say that the people whom I represent are at least as ardent in their support of public ownership of the central bank as are those supporting any hon. gentleman to my right. In spite of their weakness in sending me here as their member they are not unintelligent. They fully understood both the purpose and the sanity of our vote, and the purpose at least of those who have criticized us so severely.
Having said that, Mr. Speaker, I have fulfilled the purpose for which I rose. I desire first to associate myself with those who consistently, in season and out and before the idea itself became popularized, have held that finance in its essence, in its utilization, is a state function, a public utility, and that in order to utilize it to the full in that capacity the instruments and the conduits by which it is administered and through which it flows also must be public institutions. I wished only to make some comment on the criticism which has been offered, and having
Nationalization of Banks

done that I shall leave it to hon. members better qualified than myself to continue the debate.


William Irvine: Mr. Speaker, the arguments which have been put forward against the resolution have been answered so completely and effectively that I do not desire to take the time of the house in attempting to do what has already been done better than I could do it. I believe the argument of the Minister of Finance (Mr. Rhodes) was answered fully and completely by the hon. member for Winnipeg-North Centre (Mr. Woodsworth), and I think that was the only argument we have had in the matter.
The hon. member for North Waterloo (Mr. Euler) told us that if we had only left the chartered1 banks out of the matter and if this had been done last year he would have voted for it.


William Daum Euler: I did not say that.


William Irvine: That was what I understood. Am I right in my first statement, that if the chartered banks had been left out the hon. member would have supported the motion?


William Daum Euler: I am sure the hon. gentleman does not wish to misinterpret what I said. I said that possibly if the government had had last year the change of heart they have had this year, they might have supported it.
I did not say I would have supported it.


William Irvine: That makes it worse. I am glad the hon. member corrected me, because it now appears that there are a number of "mights" about it, and that the remark applied not to him at all, but to the government. I am clearer, however, on what the hon. member for West Edmonton (Mr. Stewart) said. I do not think he left any doubt in the minds of hon. members. In addition to adding two or three other "ifs" he Said that if the chartered banks had been left off and if the motion had been made last year he would have voted for it. Of course we have to take the word of an hon. member of this house, but we do not have to believe, do we?-or is that part of our duty, also? I certainly do not believe the Liberal party would have voted for the central bank if it had been socialized or nationalized, or anything else you wished to call it, through and through and through. I do not believe they have any intention to vote for that. I do not believe if they were in power to-morrow they would touch it. The central bank as it now stands, a privately owned institution with a measure of government control, is one of the best central banks of its kind in the world, 
but at the same time I am not satisfied with it. I wanted it nationalized last year, and I want it nationalized now. But who prevented us last year from even getting a vote on nationalization? The Liberal party did. Apparently they were afraid it would come to a vote and they would have to say which way they were going.


John Vallance: We voted for it in committee.


William Irvine: There is no publicity in
committee.


John Vallance: Is that not a record of the house?


William Irvine: There is no publicity in
committee. When the measure reached the house, and when we moved an amendment to the motion for second reading, who was it that rushed around with the rule books to find some method of having it ruled out of order? Who was it that raised the question of order on the floor of the house? It was an hon. member belonging to the left wing of the Liberal party, the right hand man of Gerry McGeer who has stated throughout the country that the Liberal party wanted to socialize the banks. When it came to the third reading of the bill, and the Liberal party had the right of way in moving an amendment, what did they do? That amendment I am sure should be preserved in the archives or sent to the museum so that future generations may study the tactics of politicians in the year of our Lord nineteen hundred and thirty-four.


Edward Joseph Garland: Send it to Punch.


William Irvine: I do not think Punch would take it, because it is too tragic. It was an amendment which said, "We want either a government owned and government controlled bank, or a privately owned and privately controlled bank, or a privately owned and government controlled bank." They got the last; it is a privately owned bank with a measure of government control. But even then, although that was in the resolution, they voted against it. I say that the sincerity of the Liberal party in this matter has been well tested. All hon. gentlemen to my right had to do was to move a simple amendment cutting out the chartered banks and leaving the national bank to be socialized. Then they could have voted for it. Why did they not do that, if they were so much interested in having the national bank socialized? I do not believe they were interested in that question at all.

Nationalization oj Banks
And so, Mr. Speaker, I am very glad to Mr. BRASSET:	I was paired with the
think that this resolution, will now be accepted hon. member for St. Ann (Mr. Sullivan), by the house and receive the support of the Had I voted I would have voted against the government.	motion.


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


Mr. MOORE (Chateauguay-Huntingdon):: I was paired with the hon. member for Chicoutimi (Mr. Dubuc). Had I voted I would have voted against the motion.


Mr. MacMILLAN:: I was paired with the hon. member for Vancouver Centre (Mr. MacKenzie). Had I voted I would have voted against the motion.
Messrs:
Ahearn
Anderson (Toronto-High Park) Arsenault Arthurs Beaubier Belec Beynon Blair Bothwell Bourassa Bradette Bury Campbell Cantley Cardin Chaplin Cotnam Davies Dickie Dorion Duff Dupre Embury Ernst Fafard Ferland Fortin
Fraser (Cariboo)
Garland (Carleton)
Gershaw
Girouard
Gobeil
Golding
Gordon
Goulet
Hanbury
Hanson (Skeena)
Hanson
(York-Sunbury)
Hay
Hurtubise
Lacroix
Loucks
Macdonald (Kings) Macdougall McGillis McGregor
McLure
McPhee
Maloney
Manion
Motherwell
Mulock
Munn
Myers
Peck
Perley (Qu'Appelle)
Pickel
Plunkett
Pouliot
Price
Quinn
Reid
Rowe
St-Pere
Sauve
Shaver
Short
Simpson
(Simcoe North) Simpson
(Algoma West) Smith
(Victoria-Carleton)
Smith
(Cumberland)
Stanley
Stewart (Leeds)
Stewart (Lethbridge)
Stirling
Stitt (Nelson)
Swanston
Tetreault
Thompson (Lanark)
Tummon
Turnbull
Veniot
Verville
YV/ pncp
Weir (Melfort) White (London) White (Mount Royal) Wright Young-89.


Mr. McDADE:: I was paired with the
hon. member for Laprairie-Napierville (Mr. Dupuis). Had I voted I would have voted against the motion.


Richard Bedford Bennett: I was paired with the
right hon. leader of the opposition (Mr. Mackenzie King). Had I voted I would have voted against the motion.


Mr. GUTHRIE:: I was paired with the
hon. member for Quebec East (Mr. Lapointe). Had I voted I would have voted against the motion.


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


Mr. KENNEDY (Winnipeg South Centre):: I was paired with the hon. member for North Battleford (Mr. McIntosh). Had I voted I would have voted against the motion.


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


Mr. BARBER:: I was paired with the hon. member for Humboldt (Mr. Totzke). Had I voted I would have voted against the motion.


Mr. ROBINSON:: I was paired with the
hon. member for Portneuf (Mr. Desrochers). Had I voted I would have voted against the motion.


Mr. HARRIS:: I was paired with the hon. member for Cartier (Mr. Jacobs). Had I voted I would have voted against the motion.
Deep Sea Fisheries


Mr. LARUE (Translation):: I was paired with the hon. member for Vaudreuil-Soulanges (Mr. Thauvette). Had I voted, I would have voted against the motion.



DEEP SEA FISHERIES


Hon. P. J. VENIOT (Gloucester) moved:: Whereas the deep-sea fishermen of the Atlantic coast, and especially those in the Northumberland straits, the baie de Chaleur and gulf of St. Lawrence, are seriously hampered in their work by lack of means of obtaining an adequate and seasonal supply of bait, especially for the cod fishing branch of the industry;
And whereas it is beyond the means of private initiative to provide the necessary facilities for the procuring and distribution of such bait, as well as its conservation;
And whereas the establishment of such facilities at central points would greatly enhance the importance of the fishing industry by an increased catch;
And whereas such increase in the industry would provide work for a very large number of fishermen who are now idle because of the difficulty in securing bait;
Therefore be it resolved, that, in the opinion of this house, it is expedient that the government should take into immediate consideration the establishment at important centres of a number of refrigerator plants of such dimensions as the Department of Fisheries may consider adequate to meet the needs of the industry, and at the same time give consideration to the best method of distribution of the bait required.
He said: Mr. Speaker, we have heard in the last few days a great deal of discussion touching the hardships that the farmers of our country have been called upon to undergo during the last four or five years in this period of world wide depression. May I be permitted, sir, to-night to say to the house that the farmers of Canada are not the only ones who have suffered in their industry during this period of depression. The fishing industry of the Dominion of Canada is a very important one; I think we occupy the third position in the world in regard to the deep sea fisheries.
The fishermen of the province of New Brunswick-I speak for that province because I am better acquainted with its fishing industry and the needs of its fishermen-have suffered from various sources during the last four or five years. True it was not the depression that brought about the losses by storms and other losses that were suffered at sea by our fishermen, but these only added to the hardships that they had to undergo during the period of the depression.

The low prices which our fishermen have been forced to accept for the products of the sea during the last four or five years have been such that unless they are aided in some way to overcome their overhead expenses, thereby lessening the cost of production, they will have to go out of business.
Last week we had a bill before the house providing for a lower rate of interest on loans to farmers, a movement which I am pleased to be able to say I supported. It was pointed out then that a lower rate of interest would aid the farmers by reducing their overhead expenses and thus in some degree compensate them for the low prices they are receiving for their products. It was also pointed out that the products of the farm had been reduced in price to a greater extent than the products of any other industry. I beg to differ from that statement, Mr. Speaker. It is true that the prices of farm products have gone down very considerably, but they have not gone down in comparison with the very low prices which are being received by the fishermen for the products of the sea. To-day the product of the sea is sold at prices that really place the fisherman in this position, that he has to choose between starvation and giving up the industry and seeking employment in some other line. That condition, in my opinion, can be remedied; and since the government is paternal enough to assist other industries I feel it my duty to invoke their aid in behalf of the fishermen.
In this resolution I suggest the establishment of refrigerating plants to provide means whereby the fishermen may obtain bait by a process easier than that through which they now get that necessity. So far as the fishermen in my county are concerned, we have a fleet of between two and three hundred vessels engaged in fishing. They leave their homes on Monday, remaining on the banks of Northumberland straits and other places throughout the week and returning on Saturday or sometimes Sunday morning. They have no time to get bait between their arrival and their departure on the next fishing trip.
In the past, in Gloucester county, we were able to obtain the clam in very large quantities as bait for cod fishing, but to-day the clam is becoming scarce. It costs a great deal more to procure clam bait than it did in the past. One reason is its scarcity, and another is the establishment of clam canning factories in the county. In Gloucester to-day there is the largest clam factory in the world, and the price is such that it no longer pays the fisherman, as it did in the past, to buy

Deep Sea Fisheries
clam for bait. Indeed, he has not the means to do so even if he wanted to buy clams, with prices as they are now.
The question may be interjected-why was this movement not made sooner? Why was it not made seven or eight years ago? Well, up to the time this depression struck the industry, prices for fish, especially for cod, were very reasonable and our fishermen could then afford, at the prices received six, seven or eight years ago, for dry salted and semipickled cod, to purchase the bait necessary to carry on their industry. To-day, at the reduced price which they receive for their fish, which is almost $2.50 or $3 per quintal less than it was seven years ago, they cannot afford it. They require some assistance, and I was going to suggest the establishment of small refrigerating plants in several central districts of northern New Brunswick or any other part of the Atlantic coast. I am speaking especially for the fishermen of northern New Brunswick, but in this regard I do not wish to be understood as being sectional in my views.
I suggest the establishment of small refrigerating plants under the absolute control and management of the government. Why do I put emphasis on that point? I do so because refrigerating plants under the cooperative system, owned in part by the government and in part by the fishermen as shareholders in the company, have not been a success. Too many jealousies arose. There was too much favouritism and the consequence was that these plants disappeared. Under previous arrangements, under the cooperative system as between the government and the fishing industry, the government paid so much per cent and the fishermen subscribed so much, and after a period of years the government's share in the undertaking would disappear and the fishermen could buy out the whole business. The result was that certain large fish dealers got into their heads the notion that they would buy out these plants, and in order to do so they bought up shares held by individual fishermen. In consequence, these large shippers of fish became the sole proprietors of the refrigerating plants and the fishermen no longer derived from the undertaking that benefit which it had been intended they should obtain.
Another reason why these plants failed in the past was that we were under the old system of ice freezing. We used ice houses. Ice was cut in the winter and hauled into these buildings and used for freezing during the summer. Improvements have been made
since that time, and under the new system now in practice in certain parts of Canada there is no need to resort to the ice freezing process at all.
Now this is not an experiment that I am going to propose; it has been tried and found successful. The government of Quebec, owning and administering their own fisheries, have inaugurated the system of establishing small refrigerating plants. On the bay of Chaleur is to be found, on the north side, the coast line of the province of Quebec, and on the south side we have the coast line of New Brunswick; and here we find on the north side the fishermen being provided with the means of conservation for their bait, while on the south side no means whatever are provided for the fishermen of the counties of Gloucester, Restigouche, Northumberland and Kent.
I have been looking carefully into this matter and have obtained plans and specifications. I have received, not estimates but actual prices of these refrigerators which have already been established, some in Prince Edward Island, I believe, and others in the province of Quebec. I find that a freezer that will freeze one ton of bait per day, and having a storage capacity of from fifteen to twenty tons, will cost, actual cost, $4,600 fully equipped. One that will freeze two tons per day, with storage capacity of from twenty-five to thirty-five tons, will cost $6,000, and one that will freeze three tons, with a storage capacity of from fifty to eighty tons will cost $10,000.
I do not intend to recommend the $10,000 process; I believe that the second process, freezing two tons, with a storage capacity of from twenty-five to thirty-five tons, and at a cost of $6,000, will meet all the requirements, at least so far as I know, in the county I have the honour to represent. And on this point there is something I would direct to the attention of the government. I would ask them to investigate the matter and to have the officers of their department go over the whole situation. Have them visit the various districts or have representatives of the fishing industry from those various districts meet them at some point where they can discuss the matter fully, take into serious consideration and report to the government.
I think I have explained this matter so that it will be readily understood by everyone; it is not necessary for me to take up any further time of the house. I hope the resolution will meet with the approval of all hon. members. I am not asking for the expenditure of public money; I am asking
Deep Sea Fisheries

that the matter be looked into, and if it is found feasible, then the government in its wisdom may decide upon the amount of money it will expend in aiding the fishermen.


Maurice Brasset: I want to add a few words on the subject of the speech just delivered by the hon. member for Gloucester (Mr. Veniot). We have in Quebec a very important fishing industry, notably in the counties of Gaspe, Bonaventure, Matane, and on the north shore of the St. Lawrence. The government of Quebec has established there several refrigerating plants for bait. It is true that the administration of fisheries belongs to the federal government, out I do not see why we should not have cooperation between the two governments. This matter was discussed at length last year and two years ago, and I think the fishermen of Quebec, being taxpayers, should benefit to the same extent as the rest of Canada in respect of the facilities afforded to them. The refrigerating plants built in Quebec are not well equipped to meet the situation. The government should establish in those counties in that province refrigerating plants such as have been asked for by the hon. member for Gloucester, and I should think in most of those places small plants would meet the requirements. An expenditure of from $6,000 to $10,000 would build refrigerating plants that would meet the situation, and the fishermen would benefit a great deal. From July 1 to September 1, I have seen fishermen all along the coast of the lower St. Lawrence idle because they cannot get bait. If refrigerating plants were established so that they could get their bait requirements, those fishermen would not be idle but would work all summer long and would not be on the dole as they are at present.
In the Magdalen islands, which is part of my constituency, the fishing industry is under the control of the federal government. There the government of Quebec, although they have nothing to do with the fisheries of that part, aid the fishermen by giving them boats and money to help the industry. I do not see why the federal government should not do the same thing for the rest of the province of Quebec. Therefore I strongly favour the resolution moved by the hon. member for Gloucester and I hope the government will take steps immediately to investigate the matter and give it proper attention.


George Manning McDade: May I be permitted to make a few observations with regard to the resolution of my hon. friend the ex-Postmaster General (Mr. Veniot). We have on the east coast of New
(Mr. Veniot.]
Brunswick what is admittedly the best dry salt cod fishing in the maritime provinces. Along with lobster, salmon, smelts and oyster fishing, this industry serves to employ a large proportion of our people, and on the north Shore of New Brunswick, particularly what is known as the Miramichi district, in numbers employed fishing is second only to our great basic industry.
With the terms of the resolution as drafted one must be in reasonable accord, but it is to be regretted that those engaged in the fishing industry have not seen fit to take advantage not only of the regulations already existing in respect to the matter of bait but particularly of the legislation adopted at the last session of parliament when the Natural Products Marketing Act was placed upon the statute books. Unfortunately the fishing industry on the east coast of New Brunswick, as is well known to the hon. member for Gloucester, is really as to ownership and marketing facilities concentrated in the hands of a few large firms, who, I may say with great respect and deference, are not doing justice to the fishermen so far as the price for their catch is concerned. Take for instance the price paid for smelts to-day-and in this connection I may say with some considerable satisfaction that the Miramichi is the greatest smelt fishing river in the world. The price to the fishermen is only five cents per pound on the ice, while in the towns, the local domestic market, the price exacted is fifteen cents per pound, and smelts, as is well known, demand a high price on the Boston and New York markets. Therefore I say in all sincerity, and I am sure hon. members will agree with me, that those engaged in this industry should take advantage of the provisions of the marketing act. In this connection a campaign of education is essential. Members from Nova Scotia will appreciate the importance of the work accomplished in 1929 by Doctor Coady in his capacity as organizer in forming various cooperative societies in that province. Unfortunately the work of organization in New Brunswick did not commence until the winter of 1929, and due to transportation facilities being unfavourable at that time Doctor Coady was forced to abandon the work, which has not since been prosecuted.
May I commend to the acting Minister of Fisheries (Mr. Stirling) the advisability of studying, if he will, the question of organizing cooperative societies among the fishermen along the east coast of New Brunswick, and

Deep Sea Fisheries
particularly of the county of Northumberland. I notice in the estimates a vote of $4,050 to the United Maritime Fishermen's Association, subject as to expenditure to provisions to be enacted by the governor in council. May I suggest that a fair and equitable proportion of this vote might be well expended in the promotion of a campaign to organize cooperative societies on the north shore of New Brunswick. In this connection, if his services are easily obtainable, as I believe they will be, I know of no more outstanding and eminent authority than Doctor Coady, who did such excellent work along that line in Nova Scotia in 1929. At the same time I should like to pay tribute to Mr. Mclnerney, a former north shore boy, who is now acting secretary of the United Maritime Fishermen's Association. I should like also to congratulate the minister upon the good work achieved by the officials of his department, notably Colonel A. L. Barry, who is the supervisor on the north shore. However, I believe that a great deal of the difficulty our fishermen are experiencing could be solved by cooperative marketing. I am confident that if a campaign of education along this line were undertaken, excellent results would follow. It would at the same time furnish the opportunity of educating the people as to the necessity of respecting the existing regulations, because between illegal fishing and the lack of cooperative marketing the great fishing industry is suffering severely.
I do not know that I favour the idea of the department establishing a number of refrigerator plants, I believe that if private enterprise were properly directed-I mean the larger fishing concerns-they would make the necessary expansion. But as to the condition of those engaged in cod fishing, I concur in the remarks of the hon. member for Gloucester. I would respectfully urge upon the department the necessity of instituting some campaign along the lines indicated, and particularly of adding a rider that part of the proposed vote of $1,050 for the United Maritime Fishermen's Association be applied towards the expense of the organization of cooperative societies on the north shore of New Brunswick.


William Duff: As a seconder of this motion perhaps I need not say I am very much in accord with the sentiments thereof. The matter of bait for fishermen is very important. The fisheries of this country depend to a great extent upon whether or not the fishermen are able to obtain bait or not. Perhaps I had
better deal with the remarks of the hon. member for Northumberland (Mr. McDade) before I deal with the subject matter of the resolution.
The hon. member stated that the fishermen -I assume he was speaking of those of his own locality-did not take advantage of the marketing facilities provided for in the act passed last year. Then he went on to say that the smelts now being caught in the Miramichi river and elsewhere in New Brunswick and Nova Scotia were sold to private individuals and brought the fishermen only a small price. Let me say to my hon. friend that there is no reason why the fishermen cannot sell their smelts directly themselves either on the Boston or the New York market. There is no need to sell them to Tom, Dick or Harry in Bathurst, Chatham, or anywhere else in New Brunswick. In Nova Scotia, for instance in the counties of Pictou, Lunenburg and other counties, the fishermen sell their fish in Boston and New York-


George Manning McDade: That is because they are organized.


William Duff: It is not because they are organized; they do it individually. In regard to taking advantage of the marketing act of last year, some of the fishermen of the maritime provinces have been organized and have been marketing their own product ever since I came to this country forty years ago. They do it voluntarily, and without compulsion. In every part of Nova Scotia and parts of New Brunswick and Prince Edward Island the fishermen have marketed their owm goods *when they thought it was to their own advantage. I agree with my hon. friend that Doctor Coady, who is one of my constituents and a distinguished member of the university in Antigonish, has done a great work in regard to cooperative marketing. Doctor Coady was appointed by the federal government in 1929 and for several years did great work in organizing the fishermen, especially in the eastern part of Nova Scotia. All credit is due not only to Doctor Coady, but to the clergymen in the counties of Guysborough, Antigonish, Pictou and several counties in Cape Breton for taking such an interest in the fisheries of their district and the people whom they serve by organizing voluntary cooperative associations. I think that very much more would be accomplished by voluntary effort than by forcing them under the marketing act passed here last session to go under a marketing board whether they want to or not.
Deep Sea Fisheries

My hon. friend is not very consistent. In discussing the bait freezer question he said that instead of the government building these bait freezers and providing bait for the fishermen this might well be done by private enterprise. If in the opinion of my hon. friend it is better for private enterprise to build bait freezers and provide bait for the fishermen why cannot the same private enterprise handle the product of the fishermen and put it on the market, whether in fresh or salt condition? So my hon. friend is not very consistent.
However, as I have said this is a very important question. It is one in which I have been interested for the last forty years. I agree with the hon. member for Gloucester that there is great need for some arrangement by which the fishermen of the Atlantic coast, Northumberland straits, baie des Chaleurs and gulf of St. Lawrence should have means of obtaining an adequate and seasonable supply of bait not only for cod fishing but also for their other kinds of fishing. We live in an age in which large amounts of money are being expended by governments, federal and provincial. The hon. member for Gaspe (Mr. Brasset) told us that the Quebec government was spending money to establish bait freezers. This government is also spending large sums in different ways. For instance a day or two ago the Minister of Finance (Mr. Rhodes) moved a resolution to amend the Canadian Farm Loan Act. We were told that a sum of $90,000,000 was to be provided. I have no objection if that sum is necessary in the interests of the farmers, but it seems to me that if this government and the taxpayers of this country are going to raise $90,000,000 to lend to farmers the government should also take into consideration the necessities of the fisheries industry, for which a comparatively small amount of money would do a great deal.
In that regard I am reminded of a statement made by the Prime Minister in the election of 1930. No doubt he was in earnest and sincere; no doubt he had the best interests of the country at heart when he made certain statements at meetings in different parts of this country. He said in the city of Halifax that "he would throw the whole financial power of the state behind the fishing industry." That was a very wide statement for a gentleman to make who desired to be returned to power as prime minister of this country. But what has the Prime Minister done in the last four years, what has his government done in the last four years to "throw any financial power of the state behind that great industry?" That industry has far greater possibilities than
(Mr. DuB.I
any other natural industry in this country; the surface has been hardly scratched, and it does not cost the people of this country a cent. If you take the mines, once the ore is taken out nothing is left but holes in the ground. When you take off the wheat, potatoes or other crops from the farms you have to cultivate and fertilize before you can grow anything more. If you go to the forests and cut down trees it takes twenty or thirty years to produce a new crop. There is no doubt that the fisheries of this country offer greater opportunity to put more men at work than any other industry in Canada, yet this government has done nothing to aid that industry.
I do not blame this government altogether. I have been in this parliament for eighteen years, and during that time the fisheries of Canada have been the rag-tag and bob-tail of practically every department of the government. I do not object to my hon. friend from Yale (Mr. Stirling) being the acting Minister of Fisheries; as my hon. friend from Temiscouata (Mr. Pouliot) would say, he is a personal friend of mine, and in anything I say I hope the minister will not think I am referring to him personally. But even before I came here the fisheries of this country were not getting a square deal, and they have not had a show since then. The fisheries department has been tied up to some other department. First it was tied up to the militia department, from 1917 to 1921 or 1922. Then it was put in with the marine department, until a number of hon. members on both sides of the house, including my hon. friend from Digby-Annapolis (Mr. Short), succeeded in showing the importance of'this great industry. After a number of years we got the government to see that the two departments should be separated, which was done in 1930. We know what happened then, and we know what has happened since. When the Prime Minister (Mr. Bennett) was returned to office he appointed a minister of fisheries, but within two years in his wisdom he again amalgamated the departments of marine and fisheries. Today there is no minister of fisheries, and the department has gone back to the Department of National Defence. So I say, Mr. Speaker, that my right hon. friend is not carrying out the pledge he made to the people of Halifax in 1930, when he said "he would throw the whole financial power of the state behind the fisheries industry."
With regard to the matter of bait for the fishermen, away back in 1906, when Mr. Fielding was the minister from Nova Scotia, the Liberal government voted some money for the purpose of establishing what were known

Deep Sea Fisheries
as ice and salt bait freezers. A number of these freezers were erected in Nova Scotia and New Brunswick, the government paying fifty per cent of the cost and the fishermen raising the other fifty per cent through cooperative efforts. I regret to say, however, that after one or two years jealousies and other difficulties arose with the result that these freezers were not a success. Another reason for their failure was the fact that in those days fresh bait was much more plentiful than it is to-day, and as everyone knows who is interested at all in the fishing industry, fishermen will not take frozen or salt bait when they can secure fresh bait. As a result, although the government of the day was sincere in its efforts to supply proper bait facilities, these bait freezers were not a success.
Later the government arranged, through the Department of Agriculture, to grant one-third of the cost of what were known as ammonia freezers. Several of these freezers were established at different points in the maritime provinces, on a large scale. It was found impossible, however, when these freezers were established at central points, for the fishermen in the outports and the villages along the shores to Obtain bait from those central freezers. So, while these freezers did a great deal of good and a number of fishermen were able to obtain bait from them, it was found that the scheme did not entirely fill the bill. In 1927, if I remember correctly, after Of became the representative of the constituency of Antigonish-Guysborough-the best constituency in Canada, I might say-I realized that the people in my district were far removed from both the bait freezers and the market. I endeavoured to impress upon the government the necessity of arranging not only for a bait supply but also for a method of marketing the fish. Steamers were therefore chartered by the government to convey bait to the fishermen and also to take away their catch to central points.
Since this government came into power a steamer, which was arranged for in 1928, still goes around Chedabucto bay carrying bait for the fishermen of Canso and vicinity, and also for the fishermen of Richmond county, but that is not sufficient. It is true that for a number of years there was a large bait freezer in the town of Canso, but the company ceased operations, with the result that the fishermen of Canso, Whitehead, Port Felix, Fox island, Queensport and other places are not able to obtain bait at certain seasons of the year. Their only chance at present is to secure bait from this small boat 92582-31
which is put on by the government in the summer season, or to secure the bait direct from the traps when the herring strike. Following the closing of this bait freezer the result has been, so far as Canso is concerned, that what was once a great industry is now practically wiped out. Hundreds of men in Canso to-day are either on relief or barely able to make a mean living due to the fact that there are no bait facilities available which would permit them to fish whenever they were willing to go out on the Atlantic ocean to the fishing grounds. So I say this resolution is very important, and a large freezer and cold storage plant should be erected at Canso.
Several years ago the government decided that a large bait freezer and cold storage plant should be erected in Halifax. I believe that was in 1927, and if I remember correctly some 8670,000 was granted to a company which built the plant at a cost of some 82,500,000. That plant ran for several years, but to my surprise it was taken over by the harbour commission last year for something like 82,000,000. I do not think that was a good business deal. The harbour commission might have waited and made better terms, because the private corporation was anxious to sell. Instead of paying
82,000,000 for the plant, I believe it could have been bought for a great deal less. Certainly if the government, whether this government or the preceding government, could spend first 8670,000 and then an additional $2,000,000 for a cold storage and bait freezing plant in Halifax, they could arrange in view of all the circumstances to spend money to encourage the fisheries and effect improvements along the coasts of Nova Scotia, New Brunswick and Prince Edward Island, so that the fishermen in the different villages may have the facilities to procure bait for the purpose of catching fish in the summer season.
Not only did the government take over the plant at Halifax but I notice in Bill 138 of last session an amount of 8286,000 was voted for the construction of bulkhead and pier, 195 feet and 200 feet respectively, to provide site for two fish processing plants adjacent to the cold storage plant. Then there was another $354,000 voted for the construction of buildings for fish processing plants adjacent to the cold storage plant. Instead of spending about $600,000, in the city of Halifax I should think that amount could have been used to better advantage out where the people catch fish, and could have been given to help the people who need bait. In view of the fact that the

Deep Sea Fisheries


William Duff: Mr. Speaker, I must challenge that remark. I want to say to my hon. friend that in season and out of season I spoke on behalf of the fishermen of the maritime provinces, and no one knows it better than my hon. friend from Cape Breton South (Mr. MacDonald). In this parliament, in the fisheries committee, and in interviews with the minister, I always stood by the fishermen not only of my own district but also of the district represented by my hon. friend.


Finlay MacDonald: I quite agree that the hon. gentleman, if I remember rightly, was chairman of the fisheries committee, and) I remember too that some of the
Deep Sea Fisheries

recommendations that were sent) up from that) committee were hopelessly mutilated' when they reached this house, but the Iron. gentleman never raised his voice in protest against that.


William Duff: Yes, I did. Did my hon. friend
raise his voice?


Finlay MacDonald: I must agree Mr. Speaker, with much that the hon. gentleman has said as to the importance of this question. Next to agriculture it is I 'believe the most important question affecting the interests of the people of the maritime provinces.
With regard to the motion itself the only trouble in my opinion is that it does not go far enough. We have been doing too much fiddling around this question. It has been approached from too many angles, and too many people have been coming along and making suggestions as to what should be done to help the fisheries.
The fisheries that surround the maritime provinces are very extensive. There are over 15,000 square miles of fishing grounds entirely within the control of the dominion government surrounding the maritime provinces. Following the good example of my hon. friend, without saying anything of a political nature, I want to call his attention to the fact that those fisheries fell behind year after year while the late government was in power, and if the hon. member was as vocal and as insistent then as he says he was, his efforts certainly were not rewarded with any degree of success.


William Duff: I admit that.


Finlay MacDonald: Because I notice that from the year 1923 to 1927 the fisheries of the Nova Scotia coast, fell from 1,370 hundredweight to 734 hundredweight, or about one-half, and the population engaged in the fisheries fell in even greater proportion. I notice that the numbers in Richmond county, for instance, fell from 1,838 in 1922 to 1,374 in 1927.


William Duff: My hon. friend must be wrong in that figure of 1,370 hundredweight. That is practically nothing.


Finlay MacDonald: That is exactly the figure given here, 1,370 hundredweight.


William Duff: It must be wrong. That is only 137,000 pounds of fish.
Mr. MacDONALD (South Cape Breton) i You will find it on page 11 of the report of the Royal Commission on Fisheries.
I Mr. F. MacDonald.]
There is no doubt, Mr. Speaker, that the condition of the fishermen in the province of Nova Scotia is very deplorable, and something must be done to improve present conditions.
With regard to the efforts that have been made along cooperative lines, while we are in favour of that, it is simply nibbling at the edge of the question, if you are going to improve the fishing industry of the maritimes you have to approach it in a much larger way than has been suggested in this house. There are thousands and thousands of fishermen in the maritime provinces who twenty or twenty-five years ago were in fairly comfortable circumstances but who to-day are destitute. Now, what can the government do? What is to be the particular benefit to be derived from establishing bait stations? Certainly they will be of some help in catching the fish, but what are you going to do with the fish when you do catch them?


William Duff: Sell them.


Finlay MacDonald: WThere are you going to find a market for them?


William Duff: In the United States.


Finlay MacDonald: My
hon. friend knows too much about the fish business to expect for one moment that the shore fishermen would be able to sell their fresh fish in the United States.


William Duff: Not their fresh fish in the outlying districts, but salt fish.


Finlay MacDonald: We have surrounding the coast of Cape Breton a number of these cooperative societies which are all working and doing well, but they have some difficulty in selling their fresh fish. My hon. friend1 knows too .much about the industry to think that we are going to make a success of it in that way; the future of the industry lies in the disposal of fresh fish.


William Duff: Not at all, you are wrong.


Finlay MacDonald: Possibly my hon. friend may know more about the salt fish industry-


William Duff: I think I should.


Finlay MacDonald: -but
I venture to say that the future of the fishing industry will lie along the line of supplying fresh fish to the markets of the world. And1 how will you do it? The idea put forward by the hon. member for Gloucester simply means the establishment of

Deep Sea Fisheries
bait houses along the shore, and that is of very little value. It is of some value, but the fact is that you have to equip these fishermen along the shore not only with bait but with all the other appliances they need; you have to finance them from the ground up. And, I repeat, how is that to be done?
I quite agree with the hon. member for Antigonish-Guysborough. It may be all right to give S90,000,000 to the farmers of the west, but let us give $9,000,000, one-tenth of that sum, to the fishermen of the east, and we shall be quite conteiit.


William Duff: Hear, hear; that is what I said.


Finlay MacDonald: For
fifty years we have been playing with the fisheries question-I quite agree with that- and we are in a worse position to-day than we were before. It is about time we shifted our ground and explored the subject from a new angle. Last year and the year before I brought before the house the question of utilizing the amount of the Washington award now lying in the treasury of this dominion and which has been distributed in dribs and drabs through the medium of fishing bounties which are absolutely of no value to the fishing industry. I suggested then, as I suggest now, that this amount should be capitalized and distributed in the form of a fund through a commission for the purpose of financing the fishermen of the maritime provinces and enabling them to get on their feet. My own idea is that the fisheries of the maritimes will have to be placed under a commission. I believe that the solution of the difficulty in connection with the whole question that faces the maritimes lies in that direction. The industry should be placed under the control of a commission who would have the expenditure of this $4,000,000.
I agree with many of the remarks of the hon. member for Antigonish-GuySborough, and the only complaint I have to make is that we are simply beclouding the issue; instead of directing our attention and all our efforts towards putting the business on a good, sound basis, we are fiddling away, spending our efforts in trying to establish bait stations along the coast. Otherwise I am heartily in favour of it.


Mr. A. A. HEAPS (North Winnipeg):: This afternoon we had a long discussion on banking and credit and this evening we are having a discussion on' the fishing industry. I confess at the outset that my ignorance of banking is profound, and my ignorance of the fishing industry is just as profound. But
that is perhaps a good excuse for me to get up and speak after those who have preceded me. I want to say a word or two however in support of the resolution. I congratulate the mover (Mr. Veniot) and the seconder (Mr. Duff), as well as all those in the Liberal party who intend to support the motion; I congratulate them on the right about face since nine o'clock. In this resolution we are told that private initiative has failed. Fancy the former Postmaster General and those associated with him in this resolution speaking of the failure of private initiative, the very thing which they voted to approve of an hour ago. They voted their approval of private initiative, which they declared had been a success, and now they condemn it as a failure.
They want to supply the fishermen with bait. I wonder what kind of bait it is. Will it be Liberal or Conservative bait or C.C.F. bait?


William Duff: No, suckers.


Abraham Albert Heaps: It seems to me however that this is a very good resolution; it is one that supports the platform of those with whom I am associated in this house, and because it does so I want to support the hon. member for Gloucester and the hon. member who seconded his motion. I find that they intend to establish government owned warehouses along the coast and I should like to see this result in increased catches for the fishermen. But I also want to see the fishermen find a market for their fish after it has been caught. The most important thing to-day is not to provide machinery for production in this dominion. We have all kinds of facilities at our disposal for producing either fish or other commodities. Our whole problem is one of distribution of the commodities produced, and that is where this resolution fails. However, I am glad to find that the mover and the seconder of the resolution realize at any rate the failure of private initiative on the Atlantic coast, and I hope that in the future, when resolutions embodying the same princinles come from this corner, we shall have support where formerly we had opposition.


Mr. H. B. SHORT (Digby-Annapolis):: Being deeply interested in everything connected with the welfare of the fishermen, and of the fishing industry, I am thoroughly in accord with many of the remarks made by my hon. friend from Antigonish-Guysborough (Mr. Duff) and I am fully in accord with the resolution which the hon. member for Gloucester (Mr. Veniot) has brought forward. I think the time has arrived when we should
Deep Sea Fisheries

do everything possible to assist the fishing industry, which during the past four years has experienced conditions which it has not known for many years previously. Less has been done for the fishing industry than for any other industry, though it is one of the greatest natural resources we have in the maritimes and capable of the greatest expansion. Off the coast of Nova Scotia we have one of the greatest fisheries in the world, but the trouble is, we need a market. That is what we need more than anything else. There is no question about production; we can produce all the fish the country requires. Unfortunately however we are up against it for a market. I have brought up in this house a number of times, being on the Canadian Fisheries Association, the advisability of a grant through the government for the purpose of advertising our fish. We are not selling the quantity of fish in Canada which we should; the people are not buying the quantity they should buy.


Abraham Albert Heaps: Why?


Harry Bernard Short: Because they are not
educated up to it.


Abraham Albert Heaps: They have not the money.


Harry Bernard Short: The people in the interior
of our country do not know anything about fish. If we spent a sufficient amount of money in advertising our product and educating the people up to eating fish; if we increased the sale of fish in this country by but ten pounds per capita, it would mean an additional
100,000,000 pounds, which would be of great assistance to our fishermen in the maritime provinces.
The resolution before the house is, I believe, a good one, and to carry out its terms would not cost the country a great deal of money. Every facility should be given to our fishermen to prosecute their industry in the best possible manner. I do not know that this government has spent very much, but previous governments spent quite large amounts of money in erecting throughout the dominion bait freezers which, as was explained by two hon. gentlemen opposite, were not a success. If modem freezers can be built at the prices mentioned by the hon. member for Gloucester, this is something to which the Department of Fisheries could give very serious consideration, and I believe if the matter is taken up in the committee on fisheries, there discussed and recommendations made to the department, every attention will be given to them. That is what I understand my hon. friend is asking for and 
I believe the government would be well advised to carry out the recommendations in reference to freezers.
But in connection with the fishing industry there are many other matters that are much more important than the freezers. As the hon. member for Antigonish-Guysborough has stated, every assistance has been given to the farming industry but very little has been given to the fishermen. I think some scheme can be worked out whereby loans can be made to the fishermen on easy terms so as to enable them to equip themselves with better facilities for operating the industry. The fishermen today are up against it for new equipment. Their old equipment is worn out; they have no money with which to replace it. Some arrangement can I am sure, be arrived at for making loans to our fishermen in order to enable them to supply themselves with modern equipment. I believe the Department of Fisheries will do everything possible to assist the fishermen if this matter is brought before them in the proper manner, and the proper place to discuss it is before the committee on fisheries. Therefore I suggest that the question be taken up by that committee and a report presented to the house, when we can discuss the problem further.


Mr. J. H. MYERS (Queens):: Mr. Speaker,-


An hon. MEMBER:: Another fisherman.


John Howard Myers: Yes, another fisherman. I
was just going to remark that some hon. members may think it rather peculiar that a farmer, one who is always proud to declare himself a farmer, should rise on this occasion to say a few words with reference to the resolution now before the house. I wish however to remind hon. members of what to my mind are two very important facts. The first is that on the Atlantic seaboard, Nova Scotia and New Brunswick do not wholly comprise the maritime provinces. I come from Prince Edward Island, the smallest province it is true of the three, but I did not make it; it was made by a higher power than I, and the reason it was made so small is that it was made so good. Another reason I have for raising my voice on behalf of the resolution moved by the hon. member for Gloucester (Mr. Veniot) is the fact that fully twenty-five per cent of the people in the riding of Queens, which I have the honour to represent, earn their living on the sea.
I can assure the house that I am most heartily in accord with the resolution. I was just glancing over it and at first I thought I

Deep Sea Fisheries
would commend it for the modesty of its contents. I notice in the first place it acknowledges, as the hon. member for North Winnipeg (Mr. Heaps) has so very nicely pointed out, that private initiative is not sufficient to cope with the present needs of the fishing industry. I quite readily admit that. As to the last paragraph, I commend the hon. member for Gloucester for his modesty, a quality that he rarely displays in the house. He says he is willing to leave the dimensions and the cost of such plants to the good judgment of the Department of Fisheries, but I feel rather inclined to agree with the hon. member for Cape Breton South (Mr. MacDonald) and the hon. member for Digby-Annapolis (Mr. Short) that this resolution does not go far enough.
I am quite in earnest when I rise to speak on a motion of this kind. This government had gone a long way to aid the farmers of the dominion, both east and west, in carrying on the operations of agriculture. We have been bonused with reference to the price of wheat; we have been assisted on many occasions to secure seed and feed, and the federal government is operating at great expense to this country but, I believe, very wisely, experimental farms in every province. The government is giving a great deal of assistance to the farmers with reference to live stock. On two occasions in my province the federal government sent down inspectors from the department here who tested all our cattle for tuberculosis, and I understand a similar test is to be made during the coming year. I am not saying that the farmers of Canada are receiving any too much attention. This is good. It is true that farming is the basic industry of the dominion, yet at the same time I am quite in earnest when I say that similar or at least suitable assistance should be given to the fishermen on our sea coast who earn their living in such a hazardous manner. With the establishment of centres for the collection and preservation of bait around the shores of the maritime provinces I am in hearty accord. I live near a fishing village and when I go to the village I often say to the boys, "How are the fish this morning? How are you getting along to-day?" Very often the reply is, " There are lots of fish, but we are out of bait." I suppose hon. gentlemen who live inland and do not understand so much about the fishing industry as hon. gentlemen who have preceded me-and let me say they know very much more about it than I do-


Peter John Veniot: Or the hon. member for
North Winnipeg, who knows nothing about it.


John Howard Myers: Well, he was getting a little dig at you, and I do not blame him for that.
I was going on to say that at certain times in the season they have what we call a run, of herring or other fish suitable for bait. If they put the nets out they can catch great quantities in a short time, a few hours, or half a day perhaps. But then the question arises, how are they going to preserve them? After a while the school passes and perhaps for weeks there will not be another run. It seems to me that, as the hon. member for Gloucester and the hon. member for Antigo-nish-Guysborough (Mr. Duff) have so well pointed out, if some means were adopted whereby this periodical run of bait could be cared for in a proper manner so as to be available for the use of the fishermen at all times, it would help them greatly. I heartily agree with what has been said by the hon. member for Antigonish-Guysborough that a number of smaller plants suitable for this work widely scattered along the shores of the maritime provinces, would serve the fishermen best at much lower cost. Suppose for instance a large bait collecting and storing plant were established at some centre to serve a great mileage of sea coast; you can see the expense the fishermen would be put to to get the bait from that plant to their little ports and stages along the shores where they want to use it. It does not matter whether it be shipped by train or motor truck or whether they have to go for it themselves in their gasoline boats; gasoline costs money, and when they have to go a number of miles for it you can see how it adds to the cost of their operations. So I heartily agree that a number of smaller plants would meet the needs of the fishermen better than a few larger ones.
The marketing of fish is a large question, the most important and most vital question of all. It is the same as with agriculture. You can leave agriculture to us; don't worry about production

we are here, Johnny-on-the-spot all the time, and all you have to do is give us the price and we will look after the production. So with the fishermen around the sea coast; if you can assure them a reasonable price for the product of their toil you can leave the production to them. I agree with everything that has been said, especially by the hon. member for Digby-Annapolis (Mr. Short), with regard to the desirability of the government or the Depart-

Deep Sea Fisheries
ment of Fisheries spending some money to advertise the fish of the maritime provinces, and British Columbia as well, in the central parts of Canada. You know I am very human; I am very kind-hearted, and often when I sit down at home to a magnificent dinner of fresh cod or mackerel-


Peter John Veniot: That's the stuff!


John Howard Myers: Doesn't he know it? Fresh codfish and new praties-can you beat it?
Mr, DUFF: Yes, and salt herring and potatoes is a good deal better.


John Howard Myers: Well, you see the difference between you and me is that your're a herring choker and I am not. But what I want to say is that rvhen I sit down to that fine dinner of new potatoes and fresh codfish right out of the sea, how I wish you people living in central Canada, in Ontario, that grand old province-how I wish you too could enjoy the luxury that we enjoy so plentifully-


Some hon. MEMBERS:: Hear, hear.


Mr. MURPHY:: Maritime rights.


John Howard Myers: Well, that I shall not enter into, but-


William Duff: And maritime brains.


John Howard Myers: Oh, I was just coming to that -something that is universally so highly valued and that can be obtained only by eating fish out of the Atlantic ocean. So I am in hearty accord with every move that may be made to advertise our fish not only through central Canada but in every part of the world.
One more thing I wish to say. The hon. member for Antigonish-Guysborough made some observations about the selling of fish. The hon. member for Northumberland (Mr. Mc-Dade) said something for which the hon. member for Antigonish-Guysborough took him to task. Well, that is part of the game. While I am not a smelt fisherman, yet I live right by a river where smelts are caught in great quantities, and I have often talked with the fishermen. It is true, as the hon. member for Antigonish-Guysborough said, that they sell this fish very readily themselves. I have seen our men pack the finest smelts in nice clean white boxes, iced, everything done as well as it could be done, and then ship them on consignment to the Boston market and often get good returns. But many times they get back scarcely enough to pay the expenses, and I have seen a bill come back for the express and duty and consignment charges. That has happened time and again. It seems to me a great pity that such an industry, carried on
fMr. Myers.]
by the best and hardiest of our race, could not by some cooperative means, whether under the marketing act or by cooperation among themselves, be organized so that they might secure a price in keeping with such arduous toil. I have seen in my own riding the finest codfish that ever came out of the water selling at the boatside or on the stage for three-quarters of a cent a pound, yet I have seen that same fish selling at the markets right in our own province at eight or nine cents a pound. It does not seem fair that the men who bear the burden and the heat of the day iand toil in the chilly night should have to sell their fish at such a starvation price.
Then around the shores of my province we need, besides bait freezers, accommodation for the protection of our boats. The north shore of Prince Edward Island faces right out into the gulf of St. Lawrence, and a north wind there kicks up a terrible sea. In some places we have harbours, in others there are none. In many places the fishermen have to haul their boats out at every tide and launch them again when they get out to sea. It seems to me that the Department of Public Works, if they want to spend a little money, could very well spend it around the shores of Prince Edward Island, and I presume-I am more charitable than my hon. friends on the other side of the house-around the shores of Nova Scotia and New Brunswick as well, to see to it that the fishermen of the maritime provinces are accommodated as well as the finances of the country will permit with breakwaters and wharves at which they can land their boats.
I have just one other thought in mind. We are doing a great deal for the labouring men and for the farmers, but I think I am correct when I say that the unemployment insurance bill does not provide for fishermen. Well, I suppose we must creep before we walk. The unemployment insurance measure is a new departure; I have no doubt it is right and I intend to give it my hearty support, but if it works well for the labouring man who is engaged in industry I can see no reason why, with a little more light on the subject, a little later on the benefits of this bill might not also be extended to those who go down to the sea in ships and labour on the great deep. At the same time let me put in a word for the farm labourer-


Mr. OASGRAIN:: Bring in a new bill.


John Howard Myers: I am a free lance; I speak my mind when occasion arises. I see no reason why a labourer who works on the same farm for many years should not come

Deep Sea Fisheries
under this measure. I have had men working for me for seven and eight years at a stretch, and I cannot see why, in a short time, we could not extend the provisions of this bill to include the farm labourer and the fishermen as well. I hope that with these remarks the gentlemen in the far corner will not consider that I am going over to their ideas.


Charles A. Stewart: Be careful.


John Howard Myers: I suppose one must be, but I feel it my duty to make these remarks.
I was nearly forgetting one other thing; I wish to join with the hon. member for An-tigonish-Guysborough, in the wish that assistance might be given our fishermen in regard to their equipment. This equipment and their fishing boats cost money. It is true that in Nova Scotia they use larger boats than we have in Prince Edward Island, yet a fisherman's boat, engine, traps, gear and equipment of all kinds, run into a good deal of money. I have seen men in Prince Edward Island set out in the spring of the year with a splendid equipment of lobster traps, each costing in the neighbourhood of S2.50. I have seen theta start out with from one hundred to three hundred traps, and perhaps they would not be in the water more than a day or two 'before every trap would be ashore, smashed into a 'hopeless wreck, and the fisherman would have to do all the work again and go to a great deal of additional expense. So I would recommend to the department and to the government that they take steps to bonus our fishermen in the construction and repair of their boats and equipment.


Mr. P. F. CASGRAIN (Charlevoix-Saguc-nay):: Mr. Speaker, I wish to say a few
words on this resolution. I am somewhat in the position of the hon. member who just resumed his seat (Mr. Myers); I am neither a farmer nor a fisherman, but I happen to represent an agricultural and fishing district in the county of Charlevoix-Saguenay, on the north shore of the St. Lawrence. Conditions in my district may be a little different from those obtaining on the Atlantic seaboard, but in my trips through that part of the country I have come in contact with the fishermen, who have told me of their difficulties in getting bait and keeping it in good condition.
I am proud to support this resolution; I think it should receive the serious consideration of the government. I was rather surprised to hear the remarks of the hon. member for North Winnipeg (Mr. Heaps) a few moments ago; he did not seem to attach much importance to this resolution and
seemed to make light of the hon. member who moved it. I think, however, that may be due to the fact that he lives very far inland and may not be familiar with conditions in the fishing industry.
All the recommendations contained in the latter part of the resolution are being carried out in the good old province of Quebec. The government of that province have come to the assistance of the fishermen in providing refrigerating plants at various places along the north shore of the St. Lawrence. As I was visiting my constituents last summer, at a place called Havre St. Pierre they were erecting a refrigerating plant with the money of the provincial government, with nothing contributed by the federal government. At another place called Thunder River a refrigerating plant was built a few years ago by the provincial government in order to aid the fishermen of that district.


Grote Stirling: Does the provincial government pay the full cost?


Joseph Philippe Baby Casgrain: I believe so, because the plants were erected under the supervision of the government. The fishermen of those districts are not in a position to contribute to the cost of such plants, as they would be required to do if the plants were constructed by this government. I know this question has been discussed here at Ottawa, and we have been told that the government are willing to provide these plants if the fishermen pay their share, but the fishermen are not in a position to do that. I should be rather surprised to learn that the federal government contributed anything toward the improvement of the fishing industry in the province of Quebec.
I was going to say, Mr. Speaker, that the provincial government has given further assistance to the fishermen in the way of bounties to aid in the construction of boats and new equipment, as the last speaker mentioned, and the fishermen in that part of the country have been greatly encouraged by the aid they have received.
I heartily approve of this resolution, and I hope the government will give it very serious consideration. I believe in order that the conditions of the fishermen, more especially in the district from which I come, on the north shore of the St. Lawrence, should be improved, there should be more cooperation between the provincial and federal governments. Three years ago in this house I had occasion to bring in a resolution asking the present government to cooperate with the provincial government. At one time it was suggested that a certain school be established in the Gaspe peninsula in order
Deep Sea Fisheries

to help the fishermen, but up to the present I do not think this proposition has been materially advanced. I know it is a difficult question, but the provincial government have done their share to develop the fishing industry of the province. The government have spent their own money, since they have control of the fisheries, but with more help needed to-day the provincial government are not in a position to contribute what is needed in the circumstances. For all these reasons I wish to support the motion of the hon. member for Gloucester (Mr. Veniot). I congratulate him, and I hope the government will accept the motion and grant the request.


Mr. F. P. QUINN (Halifax):: Mr. Speaker, I will not delay the house for very long. I just wish to congratulate the hon. member for Gloucester (Mr. Veniot) for having brought in this resolution. I consider that the time that has been devoted to the discussion of this question has been spent very profitably, since it has brought to the attention of parliament and the country the deplorable condition of the fishermen, particularly in the maritime provinces. I believe, with another hon. member who has spoken, that the resolution does not go quite far enough. I think it should have further consideration and should be thoroughly discussed before the fisheries committee. Following that a report could be presented by that committee to parliament and some action taken by the government looking to the improvement of conditions generally among our fishermen.


Grote Stirling: Mr. Speaker, the hon. member for Gloucester (Mr. Veniot) brings to the attention of the house 'his suggestion for the improvement of conditions in the fishing industry on the Atlantic coast. He suggests the establishment at important centres of a number of refrigerator plants adequate to meet the needs of the industry, and at the same time he desires that consideration be given to the best method of distribution of the bait required. In his remarks he has explained that he wishes this to be done entirely at the expense of the taxpayers. He did not make it clear whether that applied to the distribution required as well as to the building of the refrigerator plants but it is obvious that if the refrigerator plants are not dotted along the coast at close intervals the distribution necessary will be much more expensive.
The policy of the government as illustrated by its introduction of the Natural Products Marketing Act-which covers products of the

sea as well as of the land-has been to show a readiness to assist the producer when he has shown himself able and willing to assist himself. In the past, governments in Canada have made attempts to handle the bait problem, and difficulty has been experienced because of the fact that bait is not available every month of the year. As a rule there is a scarcity in the fall and a plentiful supply in the spring, and the difficulty is that facilities are not easily provided for caring for the surplus obtainable in the spring so as to make it available during the fall months. The hon. member for Antigonish-Guysborough (Mr. Duff) referred to one series of attempts made nearly forty years ago with respect to the provision of bait freezers using ice and salt. They were to be built on a fifty-fifty basis as between the dominion government and the associations of fishermen. The system fell down for one reason because sometimes there would be years when bait would be plentiful, and on such occasions the fishermen did not see fit to store the ice, so that the bait was not put into storage and when bait became scarce there was no supply in the freezers. That policy was changed some ten years later, and other attempts were made by the dominion government over a course of years to provide freezers to overcome the bait difficulty. In 1929 and 1930 a determined attempt was made to overcome the difficulty, and as a result regulations were formulated which I shall summarize in this way: Where associations consisting of not more than twenty fishermen, who spend at least three months at sea fishing each year with baited hooks, would be formed, they would be assisted in the establishment of bait freezers to the extent of seventy-five per cent of the cost, and would also receive a bonus on the bait frozen for the first five years of $5 per ton, up to twenty tons. The associations were required1 to give a bond for $1,000 that they would carry on in accordance with the regulations. These provided amongst other things that the association would employ and pay a competent man to operate the plant and to deliver bait to the fishermen as they might call for it.
Only three freezers have been built so far under that arrangement. The first one, in Halifax county, operated only one year; the second was in Inverness county and is still operating, and the third, which was completed only last fall, is in Richmond county. In June, 1930, the late administration saw fit to give considerable assistance by way of a money grant for the building on a very large scale of a bait freezer at Yarmouth.

Railway Act-Traffic by Water
The plant cost in the neighbourhood of $100,000, the contribution by the federal government being $63,750. There were many who gravely doubted whether a large bait freezer could be made to pay, one of the great difficulties being the consistent and continuous distribution required from that one spot to the many points all along the coast where the bait was needed. The plant went out of operation in two years. An appeal was made to the present government to permit the closing of the plant, and permission was granted on the understanding that it would be reopened on demand.


William Duff: Would the minister allow me to say that one of the officials of his department recommended the purchasing of the plant in Yarmouth, a plant which never should have been purchased?


Grote Stirling: There was a recommendation that if the government asked the company in question to build a plant at Canso within a year, the plant would be built, presumably under the same arrangements. As the original plant was not successful, the one at Canso was not built. Probably that was a mighty good thing.
Hon. members speaking to the resolution have wandered rather far afield by suggesting its expansion to provide fishermen with boats and gear, marketing facilities and all sorts of things that do not come within its terms. I believe the best way to handle the matter would be to refer it to the select standing committee on fisheries, and with that in mind I would move, seconded by the Minister of Public Works (Mr. Stewart):
That at the end of the resolution should be added the words "and that the resolution be referred to the select standing committee on fisheries for consideration and report to the house."


Peter John Veniot: Mr. Speaker, evidently we cannot finish this debate to-night, and I therefore move the adjournment of the debate.
Motion agreed to and debate adjourned.
On motion of Mr. Guthrie the house adjourned at 10.58 p.m.
Tuesday, February 5, 1935