1936-03-03

Hon. ERNEST LAPOINTE (Minister of Justice):: Mr. Speaker, the other day the house agreed to appoint a special committee for the purpose of studying the Dominion Elections Act and the Dominion Franchise Act and possible amendments thereto, and it was suggested that this committee should consist of thirty members. In order to save time I would ask the consent of the house to make a motion to complete this committee to-day, as follows:
That the special committee appointed to study the Dominion Elections Act 1934 and amendments thereto and the Dominion Franchise Act 1934 and amendments thereto shall consist of thirty members, and that standing order 65 be suspended in relation thereto, and that the following be appointed thereto:
Messieurs: Bothwell, Cameron (Cape Breton North), Clark (York-Sunbury), Dussault, 
Factor, Fair, Girouard, Glen, Heaps, Jean, Mac-Nieol, McCuaig, McIntosh, Parent (Quebec West and South), Perley (Qu'Appelle), Power, Purdy, Rickard, Robichaud. St-Pere. Sinclair. Slaght, Stevens, Stewart, Stirling, Taylor (Norfolk), Turgeon, Turner, Wermenlinger, and Wood.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Mr. JEAN-FRANQOIS POULIOT (Temis-couata): Mr. Speaker, by special leave of the house, if the house is unanimous in the matter, I wish to move:
Whereas the last meeting of the select standing committee on debates took place on June 17, 1931;
Whereas, before taking into consideration any further matter which might be referred to them by the house, a general and summary survey of the manner in which the past recommendations of this committee which have been approved by the house have been complied with during the last five years, shall be made;
Whereas a meeting of the said committee has been called for Thursday next, March 5;
That the said select standing committee on the debates shall take into consideration any matter within the scope of their jurisdiction and report to the house accordingly.
Right Hon. W. L. MACKENZIE KING
(Prime Minister): Mr. Speaker, I believe notice of motion will be required.
Mr. SPEAKER:: I think this is one of the motions of which notice is required before it can be put to the house. I therefore direct that the motion stand as a notice of motion.
Motion stands.



WHEAT POOL

[Stage Direction]
EQUALIZATION OF 1930 PAYMENTS ON WHEAT On the orders of the day:
Right Hon. R. B. BENNETT (Leader of the Opposition):: Before the orders of the day are proceeded with, I should like to ask the government whether or not we may expect that the legislation promised by the right hon. the Prime Minister (Mr. Mackenzie King) with respect to the payments for grain sold by producers thereof in 1930 will be introduced at an early date. I do this in consequence of receiving large numbers of communications complaining that with the bitterness of the weather and the bills that have been incurred this money is very urgently required.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: I hope it will be possible to have the legislation brought down within a fortnight.

Canada-U. S. Trade Agreement



CANADA-UNITED STATES TRADE AGREEMENT PROPOSED APPROVAL SUBJECT TO LEGISLATION MAKING PROVISIONS EFFECTIVE

[Stage Direction]
The house resumed, from Friday, February 28, consideration of the motion of Mr. Mackenzie King:
That it is expedient that parliament do approve of the trade agreement entered into at Washington on the 15th day of November, 1935, between His Majesty's government in the Dominion of Canada and the government of the United States of America, and that this house do approve of the same, subject to the legislation required in order to give effect to the provisions thereof.
Mr. J. T. THORSON (Selkirk):: Mr. Speaker, in the short space of time that remains at my disposal I shall make only a few remarks. It is perhaps too early to pass any considered judgment with regard to the enlarged trade with the United States that will follow as a result of our trade agreement with that country, but already there are some indications of what is likely to take place; for we have the trade figures for January of this year and we can compare them with the trade figures for January, 1935. Our exports to the United States for January, 1935, amounted to $17,872,669, wrhereas our exports for January, 1936, amounted to $20,872,966, an increase of approximately 17 per cent. On the other hand our imports from the United States for January, 1935, amounted to $23,156,701 whereas our imports for January, 1936, amounted to $26,284,935, an increase of approximately 13^ per cent.
Some of the commodities exported to the United States are striking; I shall deal with one of them. Our exports of cattle, for example, increased from $67,647 in January, 1935, to $498,270 in January, 1936. Our exports of shingles doubled; our exports of planks, boards and other kinds of lumber also showed substantial increases.
The speech delivered by the right hon. leader of the opposition (Mr. Bennett) was a remarkable address; it made a number of things perfectly clear to this house and to the people of Canada. In the first place-I think it cannot be disputed-the speech of the right hon. gentleman made it perfectly clear to everyone in Canada that if the Conservative party had been returned to office Canada would not have had any trade agreement with the United States at the present time. The right hon. gentleman blames the government for not obtaining greater concessions from the United States, and then in the next breath he says that he would not give the United States the concessions they ask, at any price. How can trade with any country be built up with that attitude of mind towards it? The right hon. gentleman wants everything his own way; that is not conducive to the building up of trade with other countries. He is very much like the spoiled boy who will not play with the boy next door unless he can have the play all his own way.
Then the speech delivered by the right hon. leader of the opposition showed a peculiar attitude towards trade agreements that is not conducive to international good will. He showed much the same attitude during the negotiation of the Ottawa agreements. He desired to give Great Britain a preference in Canada, but before doing so he raised the tariff sky high so that what seemed to be a preference to Great Britain was in reality no preference at all. Now the right hon. gentleman wants to know what we intend to do with regard t-o the intermediate tariff. Why should he be concerned with what our attitude is going to be during this session towards the intermediate tariff? Would that affect his attitude towards this agreement? Would he vote for this agreement if he were told that immediately after that we would increase the intermediate tariff? Would he have the government do that; would he have this parliament pass this trade agreement and then, immediately after passing it, during this very same session, raise the intermediate tariff? Is that the spirit that should be shown in bringing about a trade agreement? Is that what he is asking us to do? In effect that would be a breach of the spirit, at any rate, of the trade agreement which we are now considering.
The speech of the right hon. leader of the opposition shows very distinctly the fundamental difference that exists between the party of which he is the leader and the Liberal party with regard to tariff and trade matters. We on this side of the house desire an enlargement of our trade with other countries. We are willing to make concessions to other countries in return for a fair and reasonable prospect of enlarging our trade with them. We are satisfied with a fair exchange, and we believe that in this trade agreement we are making a fair exchange with the United States. But there is another difference between the viewpoint of the Conservative party and the viewpoint of those who sit on this side of the house. Personally I do not like the word "concession " as applied to the tariff reductions that we have made. We are not making these tariff reductions in any sense as concessions to the United State? We do not regard

Canada-U. S. Trade Agreement
them as gifts to the United States; we regard them as tariff reductions made in pursuance of the Liberal policy with regard to the tariff. We wish to make substantial tariff reductions in Canada for the benefit of the Canadian people, regardless of whether we get concessions from other countries or not. If we can get concessions, well and good, but whether we get concessions or not we on this side of the house feel that the time has come when substantial reductions should be made in our own tariff. The Liberal party was elected on a platform of substantial tariff reductions. The tariff structure in this country is much too high. We have had five years' experience of high tariff policy, and I think it has been demonstrated throughout the whole of Canada that that policy has failed. There are many commodities on which in the interests of the producers and the consumers of Canada we require an immediate and substantial decrease in the tariff.


Walter Edward Foster: Order. The hon. gentleman's time has expired.


Joseph Thorarinn Thorson: I have only a word or
two more. We wish substantial reductions on such commodities as gasoline, agricultural implements and textiles, to mention only a few. This country has suffered from the policy of high tariffs, not merely in one section but in all sections. The overwhelming vote given to the Liberal party meant that Canada did not wish to endure any longer a policy such as that from which it suffered during the preceding five years. Substantial tariff reductions are demanded, and it is the duty of the Liberal party to carry out the mandate given to it by the people of Canada.


Mr. J. H. HARRIS (Danforth):: Mr. Speaker, I wish to take advantage of this my first opportunity to congratulate you on your elevation to your high office, and in the same sentence may I add my congratulations to the Deputy Speaker.
I hope my hon. friend who has just taken his seat (Mr. Thorson) does not go away, because I am going to have something to say to him in a few minutes; meantime I would much rather address myself to the Prime Minister (Mr. Mackenzie King) who consummated this Canada-United States trade agreement. During the past twenty-five years it has been my experience to have pass over my desk from week to week invoices for one or two cars of goods going out of this country and one or two coming into Canada, so that by absorption if in no other way I should have some idea what it means to trade with

our American cousins. Perhaps that is why I was interested enough to sit quietly and listen to the Prime Minister expound to us what I hoped would be shown to be the benefits of this trade agreement to our Canadian people. I listened to a long historical review of what had been done in the past, and what they had tried to do with regard to negotiating a treaty. When he came to something political that might sound good to the ears of his followers he stressed it very heavily, but to my idea this agreement is entirely bereft of any virtue or good result in the main to our Canadian people. I was thinking of those Canadians who to-day are on the relief roll, and those good Canadians who find their vocation in industry. I heard that the Prime Minister went across the street in Ottawa to the United States representative and asked for an interview with the president of the United States, because he was going south for a holiday. A Florida frolic! I thought one of his proteges from Ontario did enough of that during the last two years, according to the press reports, to prevent the Prime Minister giving to the press a statement that he was going south for a Florida frolic. However the interview was arranged; the Prime Minister went to Washington, called on the Canadian legation and stayed overnight in the White House-all the things which he said had been done previously by the leader of the opposition (Mr. Bennett). He achieved the interview with the president, as the leader of the opposition did, slept overnight in the White House in like manner, I suppose had the same brand of orange juice for his breakfast in the morning, and I suppose slept in the same bed. At any rate the next morning he gave a statement to the press. Then instead of going south for his Florida frolic he hastened back because Armistice day was approaching, and he made a statement in Canada. I hope there was no political significance attached to that; I do not think there was. However, it will be said that he did a great deal more than the leader of the opposition; he consummated an agreement.


Mr. DUNNING:: Hear, hear.


Joseph Henry Harris: I admit at once-the hon. Minister of Finance (Mr. Dunning) says "hear, hear"-that he did consummate an agreement. And it will be said that it was on the same basis as the leader of the opposition was negotiating an agreement previously. That side of the picture is perhaps true, but the leader of the opposition stopped and waited to see whether we were going to get everything which which it was in the power of the president to give, inasmuch as the

Canada-U. S. Trade Agreement
Prime Minister gave everything which it was in his power at that time to give. He gave most favoured nation treatment; he gave the intermediate tariff-I ask my hon. friends not to go too far away; I shall have something more to say about the intermediate tariff. When he gave this intermediate tariff of course he left a loophole so that when the budget comes down my hon. friend the Minister of Finance, one of those orthodox Liberals that the hon. member for Jacques Cartier (Mr. Mallette) was talking about the other evening, along with his orthodox cabinet, can deal with it. And he will get the support of a lot of other people if he does see to it that when it comes to arranging the intermediate items in our tariff the livelihood of those of our citizens who find themselves in difficult circumstances trying to continue to produce in industry will have an opportunity to live. I would like, Mr. Speaker, to have your position for about a week. If I had it I would make a gangway just beyond these ultra-Conservatives like the hon. member for Parkdale (Mr. Spence) down there so that the radical breezes from the southeast corner would not blow over here and contaminate us. I would take these radical Liberals, these enthusiasts that come from Rosthern or some such place, even my hon. friend from Wood Mountain (Mr. Donnelly), make room for them down beyond the gangway, and pick out a seat for the hon. member for Selkirk (Mr. Thorson), because he will want to sit beyond that gangway by the time the orthodox Liberals are separated from the radicals that the hon. member for Jacques Cartier was telling us about not long ago. I ask you, sir, is it fair to expect us to vote on the Canada-United States trade agreement when we do not know what is going to happen when the budget comes down? I do not think it is. However, here we have it, a white paper with a list of goods which can now enter the United States a little easier, and a great long list which can now flow into this country a little easier. Look at it any way you like; analyze it, and in the main you will find that the products of our primary producers are going to be able to enter the United States a little easier. Yes, we are thankful for that. In a moment I will deal with cattle. But in the main, as far as goods coming into this country are concerned, they will be manufactured and partly manufactured goods. What does that mean? What is going to be the result? It is difficult to prophesy, but we have before us the record of the last twenty-five years, since the 1911 reciprocity
deal was sponsored by my hon. friends opposite. As briefly as I can I shall try to recite its effect. First take the railway situation; the Jersey Central, the Illinois Central, the New York Central, the Chicago, Minneapolis & St. Paul, all those railroads running, like the Mississippi river, north and south, depositing their wares close to the border of Canada; you will find more and more of these manufactured goods coming into Canada, whereas our great railroad systems running east and west will lose the most of their revenue from the long freight haul on the traffic which bears the highest freight rates, that is, manufactured and partly manufactured goods. This agreement will tend to divert that trade north and south; it will not help the east and west trade and therefore will not help our railroad problem. The Chicago, Minneapolis & St. Paul will carry goods into our western provinces; the New England lines will supply the maritime provinces; Detroit and Michigan will be supplying southwestern Ontario; Buffalo and that part of New York state will be supplying the Niagara peninsula and Toronto, and Seattle will be supplying British Columbia. Is that going to help our railway situation? Not as I see it. Time will not permit me to go into more detail, but before passing the subject may I say this: When by the agreement the government did away with the preferential position held by our ports of Saint John, Halifax, Quebec and Vancouver, which enjoyed a ten per cent reduction of the duty payable on goods coming to those ports it made a most unnecessary move. It was not necessary to do that. I say that it was not necessary to put New York, Boston and Seattle in the same position as the other ports I have mentioned. Hon. members opposite say that it was. The railways say that we get millions of dollars of revenue from the haul of export goods from midwestern states through Canada.


Some hon. MEMBERS:: Hear, hear.


Joseph Henry Harris: Of course we do. and ever shall. My hon. friend pounds his desk. Look at the geography; look at your maps, if you have not looked at them, and trace the shortest route to the seaboard from the great Chicago market. Find the shortest route for the export of goods going to London and Liverpool markets. Those goods come through Canada; the freight will find its way through the shortest possible and least expensive route which, fortunately for us, is through Canada. The alibi of some private member in Albany or a senator in Washington introducing a bill is all humbug and eye-wash, to my idea,

Canada-U. S. Trade Agreement
because business will find its channel along the lines of smallest cost. That is my experience and it has been the experience of other business men, regardless of the sentimental idea that our United States cousins would force these goods to go over their own railroads. I would remind the house that their railways run north and south, anyway.
I do not know the constituency of my hon. friend, but he seems to be taking an active interest in the subject. I may have something to say to him in a moment or two.


Mr. McPHEE:: My interest is in the new senator who has just entered the gallery.


Joseph Henry Harris: I will leave it to the maritime righters to rise in their places and tell us all about the port preference. Perhaps they may be moved down beyond the gangway, before the next four years are over.
I shall return to a discussion of the remarks of the hon. member for Selkirk (Mr. Thorson), and shall deal with his observations on the Ottawa trade agreements. I wonder if he has been in a huddle with the Minister of National Revenue (Mr. Ilsley) in his consideration of this matter. I wonder if he has looked at the figures; I wonder if he has looked at the statistics; I wonder if he really thinks they are as iniquitous as he would have us believe. I wonder if when he was speaking about the increase of trade with the United States in January he would not have been more fair if he had shown that whereas there was an increase of $5,600,000 in exports to the United States in that month, at the same time we had an increase of $6,000,000 to the United Kingdom, due to the Ottawa trade agreement. Why did he not put all the figures and all the facts on record, if he wanted to put any of them before the house.
He has said that the tariff was raised two hundred per cent, but he does not mean that. He has stated that an unfriendly spirit has been engendered in Great Britain towards Canada, but he knows that is not true. He knows that when a question was asked in the House of Commons on December 10 of last year by Sir Percy Hurd I think it was, the reply by the Right Hon. D. Hacking, Under Secretary of State, was in most friendly terms. The hon. member for Selkirk quoted nothing to support his statement, but I shall give something to support mine.
Looking over my files I find a letter dated February 3, addressed to me from Kingsway, England. This letter contains a review of general conditions. There is one page dealing with Russia, another with Germany, another with Prance, and then some observations on this country. My English correspondent is a

director of organizations employing at least
3,000	people; he is connected with seventeen concerns, is chairman of a European cartel and knows whereof he speaks. He says:
In this country-
The United Kingdom.
-our position following Ottawa and the duties which were imposed here, is distinctly improved. Production has increased and we have gained a larger share of our home trade which has benefited us in spite of the fact that prices have shown a tendency to fall rather than to increase as a result of the tariff.
We have made substantial strides in general production as well as in special production, and are now getting a very substantial share of the home trade in the former category as well as in the latter. One result of the tariff has been that this country is taking its proper place as an important producer.
I have given a statement supported by evidence, whereas my bon. friend's iniquitous statement was one without any evidence of fact behind it. To substantiate the facts I shall quote figures supplied by the Dominion Bureau of Statistics. These figures show that our domestic exports to the United Kingdom increased from $16,611,036 in January, 1935, to $21,682,840 in January, 1936. At the same time I admit there was only a small increase in our imports from the United Kingdom. Then, we find a substantial increase in yearly exports to the United Kingdom, and we find that they jumped from $174,043,725 in 1932 to $184,361,019 in 1933, $227,601,411 in 1934 and $274,182,737 in 1935. I ask the hon. member to go home and ask some of the hog producers of the dominion how they fee'l about the empire trade treaty. They saw the production of 6,000,000 hogs per annum raised from the four dollar per hundred price level which was prevailing. One year it is raised to six dollars, then the next year to eight dollars, at which price it remained, and we have poured $24,000,000 into the pockets of the Canadian farmers in one year and $48,000,000 in the next year by raising that level. I ask the hon. member if that was so iniquitous or if it was hard for us to take. Was it hard on the Canadian people? Did it make for what he called empire nationalism?
The hon. member has said that the trade agreement with the United Kingdom made it more difficult for us to make agreements elsewhere. He suggested that we were becoming nationalistic and empire minded. I say to the hon. member for Selkirk here and now that this Canada-United States agreement will do more towards Americanizing us than did the United Kingdom agreement towards making us more British. I ask him to take

Canada-U. S. Trade Agreement
his choice; does he wish to be more Americanized? In twenty-five years does he wish to see this country another state of the union-


Some hon. MEMBERS:: Oh, oh.


Joseph Henry Harris: -or would he not be more content to be a little more imperialistic? That is all I have to say to the hon. member for Selkirk.
In the next sentence I admit that there are some good features in the United States agreement.


Some hon. MEMBERS:: Oh, oh.


Joseph Henry Harris: The Minister of Finance does not seem to think that that is sensible or logical.


Charles Avery Dunning: I do; it is the first logical thing the hon. member has said.


Joseph Henry Harris: Let me make this general observation. Had we remained in the same position we were in in 1911, then if we had passed the 1911 treaty and had no increase in the export of raw materials and no increase in the importation of manufactured goods it would mean that because of the treaty $58,000,000 less would be paid out through the payrolls in Canada than was the case last year. I prophesy this, Mr. Speaker, that if the government goes the way the radical Liberals want them to go, not the orthodox chaps, that is what is going to happen, and instead of having a balanced economic life as we have in Canada to-day, we will have an economic life very much out of balance; our people would have to revert to primary industry when everybody knows in his heart that that is the last thing they will do. Let me illustrate that trend. People are prone to say to-day that machinery is displacing labour, and to a degree it certainly is, but primary production in this country to-day is nevertheless employing the same number of people that it did in 1910 whereas manufacturing industry has jumped from
400,000	to 600.000.
In 1910 two-thirds of our people were engaged in primary production and one-third were engaged in secondary production, but to-day fifty per cent of our people are in one category and fifty per cent in the other. If you leave out the people engaged in services [DOT]-I refer to people such as are members of this assembly, non-producers, educationalists, men who look after our spiritual welfare, doctors and all those others who look after our services-if you take out that one million and leave only the producers, primary and secondary, you have the balanced national life such as we have in Canada to-day. And that proves my point, which is that there has been retained for Canada an annual payroll of $60,000,000 by the rejection of the 1911 treaty. So I say to you orthodox Liberals, if you accept this Canada-United States agreement you will jeopardize the future of this country to the extent I have indicated, and I do not think you want to do that. In other words, Mr. Speaker, get the gangway ready and let us find out who is who on this agreement.
I would not say anything to my hon. friend from Lake Centre (Mr. Johnston) if he were not a former member of this house. But last night he rose in his place and deprecated the increasing costs of agricultural implements. Agricultural production has gone down and manufacturing production has gone up, and so we have a more balanced economic life in this country. Our production of products of agriculture, forests, fisheries, mining and electric power amounts to $1,051,543,238, or a

Canada-U. S. Trade Agreement
rate is 27| per cent. The furniture industry-employs 7,783 men and 565 women and pays wages and salaries amounting to $7,000,000. There are 380 factories in Canada and the industry as a whole has had very difficult times. During the past five years business has shrunk twenty, thirty and forty per cent. Furniture can be produced much more cheaply in the southern States than in Canada. The cost per unit is much less because of the greater use of automatic machinery to displace labour. The factories in Grand Rapids, Michigan, are more than anxious to supply western Canada with the necessary furniture. These manufacturers know and the government knows that this Canadian industry has had its trials and troubles because of the industrial codes which have been put upon the statute books of the province of Ontario. These employers are finding it difficult to get along and the government should be fair to them and give them an opportunity to survive.
I notice that it is intended to permit a tourist to bring back $100 worth of goods every time he goes to New York. The other Sunday evening a lady and her daughter came to my house for dinner. She told me that she had been in New York the week before with her daughter and that they had both bought new ensembles. They intended to go down to the Sunnyside boardwalk on Easter morning if it was fine and display their two hundred dollar purchases. Each and every year from 500,000 to 1,000,000 people cross the border between this country and the United States. I am not one who believes that because there are twelve times as many people south of the line, we can expect twelve times as much trade. If these million people who go back and forth every year bring in only one-half their quota of goods, it means goods to the value of $50,000,000. When this amount is broken down, as I indicated a few moments ago with other figures, it represents a reduction in the payrolls of Canadian people of $12,500,000 per year. The reduction will be at least that much, if not more.
When people from south of the border come over here they just shoot a few deer and take home the horns. They may take home a box of fish or a few pieces of woollen goods, but that is all. When it comes down to the question of style, we go to the United States. Look at what the hon. member for Parry Sound (Mr. Slaght) brought from Broadway? What do you think of that? Was that made in New York? Goods brought home from New York! See the cut of it!

But in garments such as these, in which my hon. friends may strut around, will be twenty-five dollars' worth of wages for an American citizen, wages taken from a Canadian. And what applies in that regard will apply not only to dress goods, but to Edison inventions of one kind or another, Westing-house inventions of one kind or another, parts of this, that and the other, all the handicrafts of Americans who set the style, who set the vogue, who give us our new inventions, let in to the tune of $50,000,000, twelve and a half million dollars of which is taken from the wage earners of Canada.
While the present Prime Minister was in power for the ten years from 1921 to 1931,
11255,000	of our people left Canada and 288,000 Canadians returned to Canada-a loss of close to a million in ten years; 100,000 a year on the average went south. They are not going south now; they are coming back. The duty of the Prime Minister as I see it is to provide for them, to provide for the employables, to provide for those who are to-day engaged in industry, and to see to it that his broad ideals about free trade and breaking dawn the barriers of world tariffs here and there do not blind him to his responsibility first to tackle the problem of finding work for the minds and hands of all kinds and classes of our people to-day, and then to go carefully on agreements such as this.
Hon. CHARLES A. DUNNING (Minister of Finance):	Mr. Speaker, as I listened to
the organ tones of my hon. friend from Dan-forth (Mr. Harris) I could realize the joy that is in his heart because at last he is able to get up once more and make a typical old-fashioned, 1911, Tory, no truck or trade with the Yankees speech. I know how much he enjoys doing that, and we should allow him a little latitude because, during the months immediately prior to October 14 last, think of the repression which my hon. friend from Danforth had to exercise while his leader and other leaders of his party were making pilgrimages to Washington, almost on their hands and knees, in an endeavour to secure from that country an agreement which could not do for this country what the agreement of 1911 would have done had it been executed.
This government entered into the agreement with the United States of America because we sincerely believe that agreement to be a good thing for the Canadian people. We also believe that it is a good thing for the American people. We do not view matters of trade as matters of war, but we do view trade as a means of building up

Canada-U. S. Trade Agreement
mutual interests. We believe it to be possible on the basis of the start now made, a start which has been striven for by people of good will in both countries for many years, to go forward and develop to the mutual advantage of people on both sides of the international border an ever increasing volume of trade. We do not claim perfection for the treaty. The negotiation of it was necessarily surrounded by the limitations which were upon the governments of both countries, limitations which have been discussed by both the Prime Minister (Mr. Mackenzie King) and the leader of the opposition (Mr. Bennett). This much is clear, however, from our point of view, that when the right hon. leader of the opposition says that he refused to sacrifice his country, thereby implying that we have done so, we make no great professions of pluperfect patriotism; we are not entitled to use the words "my country," as he does; we can only use the words "our country." We have not as large a proprietary interest in it, it is true, but we are Canadians, and we resent that old Tory accusation that we are sacrificing our country. No man in this house, no matter what his party, would intentionally sacrifice his country. We may make mistakes in judgment-'all of us, I presume, have done so- but I do not believe there is a man in this house who falls short of another in his affection for and his support of this Dominion of Canada and its people.
With regard to my right hon. friend's speech I want to point out one or two things in it, in the short time at my disposal, and I shall hurry on and adhere very closely to my notes.
The right hon. gentleman indicated percentages of reduction in the treaty on United States goods coming into Canada, and he rolled over his tongue "100 per cent," "50 per cent," and another percentage, but he did not of course tell the house that these percentage reductions were exactly those involved in his note of November 14, 1934, to the government of the United States; that the offer made by my right hon. friend and his government involved all the percentage reductions he referred to.


Richard Bedford Bennett: Mr. Speaker, I must rise to a question of order. There was no offer made. There was an offer of a basis for negotiations.


Charles Avery Dunning: Yes, Mr. Speaker, I expected my right hon. friend to correct me. It was a basis for negotiations. Whoever heard of any one advancing as a basis of negotiations more than he was prepared to give, or demanding in return less than he was prepared to take? This was the commencement of a deal. The advances a basis of negotiations, to use his own language. He does not mean to tell this house that he asked the United States for less than he was willing to take in opening negotiations. I do not think he would ask us to credit anything of the kind. My right hon. friend says, on page 625:
I am one of those who have always been more or less alarmed and concerned about the favoured nation clauses in our treaties.
Well, sir, as a basis of negotiation, on November 14, 1934, he offered the United States of America full most favoured nation benefits in their relations with Canada. Those benefits must necessarily have been exactly the same then as now. There has been no change in the meantime.


Richard Bedford Bennett: If the hon. gentleman will permit me, he has entirely misapprehended the point. The point was that that was the basis of negotiation, depending entirely upon what we got for it, and unless we got suffi-cent for it we would not give it.


Charles Avery Dunning: I shall come to that point presently. In the meantime, Mr. Speaker, I hope you will remember these interruptions. Unlike my right hon. friend, I have not three hours; I have only forty minutes in which to develop my argument.
Then on page 627 my right hon. friend says:
That means that we have bound ourselves not to increase the duties, either intermediate or general, during the term of this agreement on those seventy-seven items.
This is an entire misapprehension of fact. There is no such undertaking anywhere in the agreement as far as the general tariff is concerned. Later on the same page my right hon. friend refers to the right granted the nationals of any country under the intermediate tariff to bring in their goods through other intermediate countries, and he says that the practice of goods passing through other intermediate countries started with the French agreement of 1922. Perhaps the point is not of very great importance, except for the reference made to my hon. friend the Minister of Justice (Mr. Lapointe) in that connection, but I would point out that the same provision was in force for many years prior to 1922 and occurred specifically in the agreement with France negotiated in 1907. In fact it was in existence for many years prior to that in connection with British treaties to which our young dominion adhered. I might specially mention the old arrangement with Switzerland. It will be evident to everyone that it must have been the case in connec-

Canada-U. S. Trade Agreement
tion with any agreement with that country, because Switzerland is entirely an inland country and goods passing from Switzerland to Canada necessarily must pass through another country in order to reach our shores.
Then there is a most astonishing statement by my right hon. friend which apparently he expects us to take for granted. He says:
I need hardly point out that in all the treaties that have been negotiated up to the present-and this we did point out with as much clarity as possible-we proceeded on the assumption that the United States was under the general tariff.
Then he goes on:
I am not in a position at the moment to state what will be the result in the various countries with whom we have treaties, now that they find themselves no longer under their special treaties, meeting the conditions provided thereby, but are faced with a new set of conditions under which the nearby United States of America enjoys the same benefits and in some instances even greater benefits-*
And so on. Well, Mr. Speaker, that is a most astonishing statement, the idea that we told or implied to countries with whom we entered into agreements down through the years that the United States always would be under the general tariff, and that these countries, though they were getting only our intermediate tariff, could always rely on this great potential competitor, the United States, being subject to our general tariff. Well, certain fairly recent negotiations, those of 1932, under the late administration may have been carried on in that spirit or attitude of mind, but surely it was never stated by anyone in authority, even under the extraordinary circumstances of 1932, that the United States would remain always under the general tariff. No more was any such promise, statement or implication given in respect of Canada's past negotiations with any other country, British or foreign.
I am attaching very considerable importance to this, Mr. Speaker, and am being very careful of my words because it is an extraordinary spectacle to see a former prime minister deliberately suggesting to treaty countries that the government of the day in Canada has so acted that they, the treaty countries, find themselves no longer under their special treaties, to use the right hon. gentleman's own words, meeting the conditions provided thereby, but are faced with a new set of conditions. I quote exactly from my right hon. friend's words. Such an idea, I venture to say, sir, would not occur to any of the countries with whom Canada has commercial agreements, since Canada, no less than they, is free at any time to admit to its

most favoured nation circle any nation on earth not formerly within that circle.
If my right hon. friend believes what he says in this regard how did. he feel free to offer to the United States our intermediate tariff or our most favoured nation treatment? Surely he was not deceiving the United States in making that offer. How then, after the event, can he come here and create doubt in the minds of all those countries with whom Canada at present has trade treaties? Then my right hon. friend goes on to say:
We have built up our ports on that assumption ... on the assumption that in all the treaties we made by which we granted favoured nation treatment to various countries of the world, it would be provided that they would ship their goods direct to this country through a lake, river or sea port.
Again I ask, did my right hon. friend inform the United States that the only kind of agreement he was willing to consider with respect to the United States would be one which compelled all goods coming from that country to Canada to enter in that manner? He knows perfectly well that he did not. It would have been an absurdity when, as a matter of fact, the boundaries of these two countries meet over three thousand miles of land. Such a provision inevitably would mean that parts of Canada could not import goods at all from the United States under the provisions of the treaty. If my right hon. friend really means what he says in this regard at least he should have pointed out to the United States in his note of November, 1934, that his offer was limited to goods that would be imported at sea, lake or river ports only. Did he do so? No.
Then the right hon. leader of the opposition asks what will be the effect on our railways. I for one am not apprehensive as to the effect on our railways, but I was apprehensive, as I believe members of the previous government were, of the possibilities inherent in the measures which had been proposed on several occasions in the United States congress by way of retaliation on Canada in this regard. There was, as every man who has occupied a position of ministerial responsibility in recent years knows, a grave danger that the White bill, or one of the other retaliatory measures which have been before congress in recent years, might possibly have become law, and it is not too much to say that both our great railway corporations were very apprehensive of the result of such a retaliatory measure on the part of the United States.
Then I come to the effect on our factories. Men are being released from employment, my right hon. friend says, in some of those branch factories to-day because it is cheaper to pro-

Canada-U. S. Trade Agreement
duce the goods in the central United States. Well, Mr. Speaker, I have made some inquiries. Some of the very few branch factories from which men are being released are branches of United States concerns which have been in existence in Canada in recent years with extremely high protection, achieved by means of arbitrary valuations, which had no economic justification for existence.
Then the right hon. gentleman developed his argument further and said, "We have a right to know whether the intermediate tariff is to be raised or not, because it changes the agreement." Well, Mr. Speaker, in fact it does precisely the opposite, because the agreement itself reserves to the Dominion of Canada full control over its intermediate tariff, with the exception of those items specifically excepted, which are contained in a schedule separate from all the rest. As to the right of the opposition to know to-day what will be proposed in the budget with regard to the intermediate tariff, it would be just as reasonable to ask what will be in the budget with respect to the intermediate tariff next year or the following year. The right of Canada to deal with its intermediate tariff, with the exceptions I have noted, is specifically and clearly preserved in the agreement. And we propose to deal with the intermediate tariff in accordance with the best judgment of this government and in the interests of the people of Canada. We shall propose to the house from time to time, in successive budgets, such modifications, up or down as the case may be, as we feel we can justify to this parliament as being in the best interests of the people of Canada.
Then my right hon. friend' says, on page 629:
The government may reduce every item, in the tariff except those with respect to which they are bound .to specific duties or free entry, ...
Well, Mr. Speaker, the bound items do not bind the government of 'Canada not to reduce.. They merely bind the government of Canada not to increase during the currency of the agreement. We have perfect freedom to reduce the rates with respect to the 'bound items, and my right hon. friend was quite incorrect in his reference to that matter.
Then there was a dramatic interlude. The right hon. gentleman gave a list of items which must be considered by this government -eggs, oats; he goes on all through the list. Now, these items existed in exactly their present form when the basis of negotiation of November 14, 1934, was offered to the United States. My right hon. friend knew at that time that these rates existed and that if he succeeded in making the treaty he would 12739-46
be faced with the question of how items such as these should be dealt with. And he expected, as this government expected-and as this government accomplished-that the right of this parliament to change its intermediate tariff on such items would be entirely preserved. I presume my right hon. friend knew perfectly well that he could not come to this parliament with any agreement which involved a wholesale surrender of the right of parliament to dead with its intermediate tariff. In that regard we agree with him, and we have preserved the right of parliament to deal with its own tariffs.
Then the leader of the opposition becomes very much concerned. He says, "What more can we give the United States than we have already given them under this agreement? What have we left to negotiate with?" "All is lost," he says, "nothing more can be done." What are the facts? Sir, there are hundreds of items in the Canadian tariff on which the existing rates are relatively high and often prohibitive. There are scores of items on which the intermediate tariff is the same as the general. In my humble opinion we have a great deal with which to bargain with the United States, if we wish to put it that way.
Then my right hon. friend got into a little difficulty with the Minister of Trade and Commerce (Mr. Euler). At page 634 the Minister of Trade and Commerce asked:
Mr. Euler: Did you ask for fifty per cent?
And the leader of the opposition replied:
Mr. Bennett: The question is not whether we asked for fifty per cent; we said fifty per cent would not be adequate.
Now I am in some difficulty, because a great deal of the information regarding these negotiations which is in the possession of the government is necessarily confidential. Obviously also we do not want to be in the position of cross-examining civil servants, who served the late government and serve ourselves faithfully and well. But I can say this, that there is nothing on record anywhere showing that my right hon. friend ever asked for the full fifty per cent, the full extent of the president's powers, across the whole line of the American tariff. There is on the other hand plenty of evidence that my right hon. friend never had in his mind the possibility of getting a fifty per cent cut on the whole American tariff. What is that evidence? What did he suggest as a basis of negotiation? Now, anyone knowing him would know that he would ask for enough. He would surely ask for the utmost possible by way of concession from the United States. And what did he ask for? He asked that the United States should



Canada-U. S. Trade Agreement
reduce its tariff by fifty per cent on a specified number of natural products-not all across the board, as he said the other day-and reduce existing rates on a number of partly or wholly manufactured products of Canada. This was offered as a basis of negotiation. If my right hon. friend ever expected to get a fifty per cent cut right across the board, surely he would have asked for it in his basis of negotiation. Surely he did not expect the President of the United States to say: Why Mr. Bennett, you have not asked for enough!
My time is getting along, and I want to deal now with the point of my right hon. friend's argument that we have given far too much for what we have received. What have we given? Again I refer to my right hon. friend's basis of negotiations of November 14,
1934.	He offered the whole intermediate tariff.


Richard Bedford Bennett: He did not.


Charles Avery Dunning: Well, perhaps I had better quote from the note.


Richard Bedford Bennett: Yes, just quote. I hesitate to interrupt.


Charles Avery Dunning: I read this:
The mutual concession of tariff treatment as favourable as that accorded to any other foreign country;-


Richard Bedford Bennett: Read the first part.


Charles Avery Dunning: These are my right hon. friend's own words:
-this means that Canada would extend to the United' States its intermediate tariff-


Richard Bedford Bennett: Quite so.


Charles Avery Dunning: -involving reductions from the present rates of duty on some some seven hundred items, including both natural and manufactured products, together with a number of further reductions below the intermediate tariff rates through the extension to the United States of concessions made by Canada in trade conventions with foreign countries.
That is what my right hon. friend said. Now he says he did not offer the intermediate tariff to the President of the United States.


Richard Bedford Bennett: Mr. Speaker, I repeat that he did not. If the hon. gentleman desires to read from the note, let him read what is said. That was the basis of negotiation; then follows a statement of what we wanted in return, and the Secretary of State wrote to us saying each item would have to be taken up item by item.


Charles Avery Dunning: Of course. But my right hon. friend in this original basis of negotiation offered the intermediate tariff.


Richard Bedford Bennett: He did not do that. He offered that only as a basis of negotiation.


Charles Avery Dunning: And he now desires us to believe that he offered as a basis of negotiation something less than he was willing-


Richard Bedford Bennett: No, he did not say that either. It depended on what he got.


Charles Avery Dunning: Well, Mr. Speaker, my right hon. friend offered as a basis of negotiation most favoured nation treatment, in the clause I have just read. He offered the binding of the free list, and he offered shipping participation. Will my right hon. friend deny that?


Richard Bedford Bennett: Offered what?


Charles Avery Dunning: Shipping participation,the shipping provision.


Richard Bedford Bennett: Certainly he did not make any offer of that kind.


Charles Avery Dunning: Then my right hon. friend stands convicted-


Richard Bedford Bennett: No, hold on. Does the hon. member ask me whether or not it is in the document?


Charles Avery Dunning: I ask if my right hon. friend offered the United States the direct shipment provision.


Richard Bedford Bennett: He did not offer them direct shipment, because no bargain was arrived at.- The matter was discussed; that is the position. It was discussed, that is all.


Charles Avery Dunning: I am afraid my right hon. friend would stand convicted of having deceived the United States because-


Richard Bedford Bennett: Not one bit of it; it was discussed, and that is as far as it got.


Charles Avery Dunning: The language of the note is clear, and I would commend it to the study of all hon. members.


Richard Bedford Bennett: Hear, hear.


Charles Avery Dunning: It is a truly historic document. The man who wrote it is forever estopped from criticizing the treaty which this government entered into.


Hon. H. H. STEVENS (Kootenay East):: Mr. Speaker, we are discussing the following resolution:
That it is expedient that parliament do approve of the trade agreement entered into at Washington on the 15th day of November, 1935, between His Majesty's Government in the Dominion of Canada and' the Government of the United States of America, and that this house do approve of the same, subject to the legislation required in order to give effect to the provisions thereof.

Canada-U. S. Trade Agreement
At the outset I wish to say that I propose to support the resolution and to facilitate the introduction of the necessary legislation, so that in its course through the house, in the commitee of the whole and the various stages the details may be discussed.
It is not my present intention to discuss many of those details. A few I shall touch upon by way of illustration, but I do wish to deal with some of the principles involved in, shall I say, this transaction. May I preface what I wish to say a little later on by observing that one could scarcely call this agreement a treaty of reciprocity, in the old acceptation of that term. Rather it is a trade agreement based upon the modern exigencies of the case and the times. I do not believe there is much to be gained by an analytical examination of the history of the two old parties in Canada with respect to the reciprocity policy. A few days ago we listened to the right hon. the Prime Minister (Mr. Mackenzie King), and he will pardon me if I suggest that the first two hours of his speech spent upon a well worked out historical record was less interesting than the last half hour which dealt with the treaty. I think the same can be said about other speeches we have heard. The argument back and forth as to whether the Tory party was for reciprocity and the Liberal party more so is not of much avail.
I am going to speak for myself. I have been in the house for, I believe, twenty-five years. Up until a year ago, or thereabouts, I was a member of the Conservative party. I cannot recall that during that time the Conservative party favoured reciprocity with the United States. Certainly I did not. I may have been misguided or misled, but certainly I am not going to pretend to the house that I favoured reciprocity, because I did not. In 1911, my first election campaign, I was elected after a very bitter controversy over reciprocity. On many occasions since I have opposed reciprocity in various forms. I would not be true to myself or to my past record were I to pretend to-day that I was or had been in favour of reciprocity.
In 1932 or thereabouts, however, at a time when I was Minister of Trade and Commerce, I realized that the trade relations between Canada and the United States were not on a very good basis. For many years- and I am not excepting the period between 1922 and 1930 when the right hon. gentleman opposite was in power-we had had, shall I say, certain controversial relations with the United States on these matters.

There was no open governmental controversy, but it was well known that the views of leaders in the United States were strongly against reciprocal arrangements with Canada, and on the other hand there was a good deal of criticism in Canada of the attitude of the United States towards entry of our goods. So I might be justified in saying that there was a degree of controversy.
About 1932, in view of conditions that were developing the world over and the inhibitions against Canadian exports entering other countries, I felt that quotas, import restrictions, the raising of tariffs, what is commonly called a national spirit, which was so prevalent and is still so prevalent throughout the world, placed many obstacles in the way of our trade and in the way of trade generally. I felt it was highly desirable that Canada should study the trade relations between our country and the United States, and with that in mind I instructed the staff under me at the time to proceed to a study of the trade between the two countries, and to prepare in detail the items upon which without injury to ourselves and in all fairness to the United States we might offer some considerations for favourable trade. I find in the agreement many of the items which we reviewed about three years ago. Many of the commodities we had studied then are included both in the note of November 14 and in the treaty. Why, under those circumstances, should I oppose the agreement?
In considering this matter I think we might take a look at the world. If we do that we will note that the great continent of Asia is the scene of threatened conflict-I am not overstating it when I use that word-between the great empire of Japan, and Russia, with China as the bone of contention. Every day in press reports we find announcements of new developments, and relations are very much strained. There is little evidence of peace and good will in Asia. Turning to Europe we find all the older and more powerful nations feverishly arming and eagerly making alliances one with the other when they think such alliances will help them in the defence of their realm-not trade agreements, not commercial understandings with each other, but alliances of defence or offence, as the case may be. Africa is a cockpit, and at the present time a slaughter is taking place in that continent which certainly offers a challenge to the modern idea of humanitarian practice. However on the American continents, both north and south, we have a condition of peace and accord, and nothing threatens the good will of our people. I suggest, therefore, that any gesture

Canada-U. S. Trade Agreement
of good will between important countries on the North American continent is a splendid contribution to the general cause of peace and good will and concord, and while the Prime Minister may have exaggerated to some extent its influence on the rest of the world, one thing is certain in my mind, and that is that we would do well to ensure as far as we possibly can that there Shall be enduring peace and concord in this part of the world. I know of no better way, Mr. Speaker, of bringing about that condition than by settling all outstanding trade and commercial difficulties and differences.
May I read an extract from this famous paper that has been quoted so often, and which I agree with the Minister of Finance (Mr. Dunning) is historic and important. I quote from the reply of Mr. Cordell Hull, Secretary of State for the United States, to the famous note of November 14. The American minister in his reply says:
I believe that a point has now been reached when an exchange of views on this subject with Canada should be undertaken, and I am, therefore, gratified to learn that your government is of the same mind. Whatever the *desirability of the freest possible exchange of natural products, and indeed other products, between the United States and Canada as an ultimate goal, the United States government must in any negotiations undertaken at this time restrict itself to measures authorized by the Trade Agreements Act, 1934.
The point to which I wish to call attention in this quotation is that the agreement is obviously looked upon by the government of the United States, and so declared in this historic document, as a step towards some ultimate goal which would be of a wider character than the present agreement or than that which was outlined' in the note of November 14, 1934. And so, Mr. Speaker, in supporting this resolution and facilitating the passage of this measure we are taking, I believe, a step towards a larger and a more complete ultimate understanding with the United States. If that can be achieved I think it is all to the good.
Let us look for a moment at the agreement. The agreement is, as I have said, a step or a gesture in the right direction. I notice that the right hon. the Prime Minister (Mr. Mackenzie King) the other day seemed desirous of justifying himself for the action he had taken. I want to say to him that I do not think he needs to do that at all. I think that the result of his action is measurably satisfactory. I shall deal with the agreement in more detail a little later on, but on the whole I think he has every reason to believe that he has made a satisfactory arrangement, 
not wholly satisfactory, but a fairly satisfactory arrangement that does not need any justification.
I would like to pause here to commend the utterance of the Prime Minister when he paid tribute to the permanent officers and officials of the government. In his capacity as Prime Minister I suppose it would not have been proper for him to make mention of any particular names, but I do not feel bound, shall I say, by that same degree of reticence. I should like to pay tribute to Doctor Skelton, head of the external affairs department, and his staff, because I know something of the work they have done in this matter. I should like also to pay tribute to Mr. Wilgress and his staff for the splendid detailed work they have done in this and in many other matters. I should also like to pay tribute to Mr. McKinnon, one of the ablest officials that we have in the government of Canada in tariff matters.	I say from
experience and from intimate contact with these and other officials that no minister could possibly discharge his duties in a matter of this kind without having at his elbow these splendid officials, and Canada can well be proud of its permanent civil service. I do not think it is out of the way once in a while to pay public tribute to these men on an occasion of this kind.
I should also like to refer to the work, because I know something of the task that he had, that was done by Mr. Herridge as the representative of this country in Washington. In this connection and in other matters I think his services to Canada are worthy of note and commendation, and I would say to the Prime Minister that neither he nor any other head of the government will lose in dignity or prestige by acknowledging that others within the ambit of government may have some part to play in the success of negotiations of this kind and in the discharge of these very difficult duties.
The Liberal program has frequently cited external trade as a likely cure for many internal ills. The Prime Minister put it in rather eloquent language the other day when he said, "Depression means absence of trade." Then he reversed it and said, "Trade means the end of depression." I should like just here to sound a note of warning and to say that while I take second place to no one in desiring to promote Canada's external trade, we would be misleading the country were we to leave the impression on the minds of those who are to-day unemployed, our agriculturists and our unemployed workers, that their troubles are ended with the expansion

Canada-U. S. Trade Agreement
of trade. That would be a mistake. By all means let us expand our trade and do everything possible in that direction. It may be a contribution towards the ending of commercial stagnation, but it is not a cure for the problems of agriculture and of labour. It may ameliorate present conditions, but it will not cure them or solve our problems, and I think it would be unwise for us to assume that it W'ould.
Coming to the agreement itself, I would say that the making of a treaty is a difficult matter at any time. You cannot always get things and never give something in return; that is clear. It is absurd to suggest that we can reach out and get all we want and give nothing in return. All we have to do is to read the public press and note the grievous complaints made south of the line regarding this trade agreement as evidence that they feel that some of their interests have been sacrificed, while on this side other interests feel that they have been sacrificed. It is not clever to criticize this treaty simply because individual interests may be affected. I am not disregarding them, and I hope time will permit me to touch on a few before I am through, but you could never make any trade agreement if you had to safeguard the interests of every individual in the country. It simply could not be done. There are bound to be some cases where there appears to be an injury, but what I would suggest is that we wait for a time and see whether these imagined injuries are real.
In the first place I want to say that this treaty is good because the motive and intention behind it are good, and I think it should be supported because the motive and intention are good. There is a spirit of good will in the treaty which ought to be and I am sure is welcomed by both countries.
The next point is the most favoured nation provision, about which there is a great deal of misunderstanding. For many years I was one of those who had a doubt, and I still have it, as to the wisdom of originally adopting the most favoured nation system of trade agreements. We have had this provision in effect in this country for twenty years or more, but it has been accentuated during the last sixteen years. During the last fifteen years the government of the right hon. gentleman opposite and the government of hon. members on this side have made in the neighbourhood of twenty to thirty treaties containing such a provision. I believe there are twenty-seven such treaties now outstanding. Let us examine this provision for a moment. It is comparatively simple, but it is significant. I should like to read one or
two extracts from treaties to indicate the wording of this provision. The treaty with Czechoslovakia contains this clause:
Articles the produce or manufacture of Canada imported into Czechoslovakia and articles the produce or manufacture of Czechoslovakia imported into Canada shall not be subjected to other or higher duties or charges than those paid on the like articles the produce or manufacture of any other foreign country.
The treaty with Finland contains a clause which is somewhat different, and which reads:
Goods produced or manufactured in Finland shall receive in Canada treatment as favourable as that accorded to goods produced or manufactured in any other foreign country so long as goods produced or manufactured in Canada enjoy in Finland the same treatment as is enjoyed by similar goods produced or manufactured in the United Kingdom.
There are some twenty-seven similar treaties, the present one making twenty-eight. What does this provision mean? Suppose we made an agreement to-morrow with Honduras-I suggest to the Minister of Trade and Commerce (Mr. Euler) that if we had a treaty with Honduras we could do business with that country which we cannot do at the present time-containing certain concessions. Those concessions would apply to the goods from all the twenty-eight countries with which we have similar treaties. On the other hand, we would enjoy any favour shown by Honduras to any other country.
There is one feature of this matter which has not been noted or recognized. Up until a matter of two or three years ago the historic policy of the United States was one tariff for all. That country has now adopted the system, which we are following in part, of making special agreements with other countries. Where the United States makes an agreement with a country with which we have an agreement, we will enjoy the same privileges as those given to the United States. I believe there are some seven or eight countries with which the United States has made agreements and with which we have also agreements. The two countries will be placed on the same basis and inasmuch as we export many things which are also exported by the United States, we will have an added advantage in those countries.
The next point to which I should like to refer is the maintenance of the free list. Since the change in policy of the United States we have been threatened with the cancellation of favoured treatment in that market unless we made this agreement. That would have been very serious to us. Let me mention a few items on the free list. Last night the hon. member for Lake Centre (Mr. Johnston)

Canada-U. S. Trade Agreement
brought up the matter of agricultural implements. One of the arguments advanced for a tariff against goods coming into Canada from the United States is the fact that the population of the United States is 120.000,000 while that of Canada is only 10,000,000. That is a perfectly valid argument, but in the case of agricultural implements we have had free access to that market of 120,000,000 people for many years. The bases for the agricultural implement industry in Canada offer first hand opportunities for large production, yet shortly after the signing of this agreement these manufacturers raised their prices. The resolution introduced by the hon. member proposes that an inquiry should be held. Whether or not an inquiry is held, I say to the Prime Minister that he should bring representatives of the International Harvester Company and the Massey-Harris Company, the two largest manufacturers, to Ottawa, and ask them to show reason why prices have been raised. I do not want to impinge upon the other debate, but this is germane to this subject. For the last five or six years the farmers of this country have experienced a diminution in the prices of their products and in their purchasing power. Then just as prices were recovering, just as they were given an opportunity to buy, these implement companies raised their prices, There may be justification for this raise but it is not discernible to the average man. I think they should be called to Ottawa to show cause for these increased prices.
The next item to which I should like to refer is wood pulp. Do hon. members realize what the maintenance of this item upon the free list means? I have before me figures showing the imports into the United States of various kinds of pulp products, such as newsprint and that sort of thing. The total imports in 1935 were 8146,000,000 in round figures. The imports from Canada in that year were valued at 889,000,000; from Newfoundland, 83,700,000; from Norway, $4,600,000; from Sweden, $28,000,000; from Finland, $8,000,000; from Germany, $5,000,000; from Czechoslovakia $1,000,000, and from France $4,800,000. It will be noted from these figures that by no means do we control that market for these products. At the present time we have an advantage because of propinquity to the market, facilities of manufacture, transportation and so on, but there are present all the elements of successful competition from these various countries unless we can maintain our position on the free list. Let us not forget that this is one of the big items of export from this country and it should be safeguarded by every possible means.

For several years there has been a distinct agitation in the United States for a duty against wood pulp and newsprint in order to encourage the production of these articles from southern pine. Successful experiments have been made in the production of these articles from this wood. Take another item. We have had free access to the American market for shingles, and I well remember that for a period of over a year when I was Minister of Trade and Commerce we were labouring under the greatest anxiety because of the efforts that were being made to stop the importation of shingles into the United States. That is something which is vital to the lumber and the shingle industry of British Columbia, and it is safeguarded and ensured and stabilized by this treaty.
Then, as regards squared timbers, ties, poles and posts, here again is a tremendous business of- a very valuable character for the working men of this country, the settlers and people more or less of the poorer class who cut these poles and make these ties; we have free access to the American market for them; it is safeguarded and ensured in this treaty. It is not enough to say that it was free before, because I know from my own experience that in many of these cases we were threatened with the shutting of these commodities out of the American market, or with an impost that would have affected them had we not made this treaty.
There is also the stabilization of our position with regard to cattle, sawn timber, and some, although not enough, of the fish products; there are some we should like to see added. But again I recall to the minds of hon. members what was said by Mr. Cordell Hull, that this was a step towards what it was ultimately hoped to achieve; and what we do not yet have we can hope later on to secure. But we did stabilize certain classes of fish, and particularly lobsters.
There is also an item regarding leather to which I should like just to make reference. I have cited only a few items. There are many others. These are items of major importance to Canadian trade and to the Canadian workman. It was highly desirable that we should ensure that these should be maintained either on the free list, or at a low rate of duty, such as is the case with the items to which I have referred.
No doubt difficulties will arise. It is inevitable and unavoidable in a treaty of this character, particularly after these long years of controversy, not without bitterness, that difficulties and complaints will arise. But I

Caiiada-U. S. Trade Agreement
would remind the house, and I say in all sincerity-that we are free to amend the intermediate tariff if we wish, although I would warn the government and the house that w7e should not exercise that right carelessly; this should be done with tact and courtesy and with consideration for the other party to the agreement. But where it is shown that an injustice is done, where it can be demonstrated that someone or some industry is injured, the proper course is to take the matter up through the usual diplomatic channels with the authorities of the United States, as the treaty in several articles provides, and make suggestions for adjustments along those lines. Undoubtedly suggestions will come from the other side. I have had something to do with several agreements, and I have never known of one where complaints have not arisen from both sides after it was passed, nor have I known of any agreement where adjustments have not been made after it had been signed and put into effect. We cannot give with one hand and withdraw with the other. We must recognize that there are two parties to a deal of this kind.
I should like to make very brief reference to a few matters which appear to me to give some cause for anxiety. There is the question of the hundred dollars free entry. Persons going to the United States may, on returning, bring in goods freely to the value of one hundred dollars. This has been the case in the United States for many years, and during that time Canada has built up quite a nice trade because of that privilege granted to American citizens who come to this country to buy goods and return to the United States with those goods free up to one hundred dollars worth. I should like to suggest to the minister who has charge, the Minister of National Revenue (Mr. Ilsley), that the privilege granted in this agreement should be limited distinctly to private purchases. There are certain specialty dealers, particularly in radios, electrical appliances, and some of the higher priced smaller articles, who might take advantage of this provision. By constantly running backwards and forwards from, say the Niagara peninsula to Buffalo, or Windsor to Detroit, or points on the St. Lawrence to various towns on the other side, it might be possible for dealers of that character to take advantage of this one hundred dollars rule to do an injustice to their competitors in Canada. I do not think there should be much difficulty; at any rate I do not think it is beyond the ability of the Department of National Revenue to devise regulations which will safeguard that provision from abuse. I wonder if those whc complain about this realize the advantage that we have now and have had for many years in selling American tourists gifts to the extent of one hundred dollars per person. We must recognize that.
Then the florists are making some complaints, and there is danger there. It is quite true that some distance south it is quite easy to raise all sorts of flowers from bulbs and other stock and ship them into Canada under this treaty. The government ought to take into account that Canadian florists have paid substantial duties on their bulbs, rose-bushes, and other stock of that calibre and are entitled to some consideration in that respect. The case is somewhat complex. On the one hand you have those in Canada who produce bulbs and base stock asking for protection, and then you have dealers of cut flowers, the finished product, also asking for protection, claiming that they have to pay this duty. I suggest to the government that an effort should be made to see that no real injustice is done to those who are producing florist stock in Canada.
The other day when the estimates of the Minister of Agriculture (Mr. Gardiner) were before the house, reference was made by some of my hon. friends from British Columbia, to baby chicks. This sounds like a trivial matter, although to British Columbia it is of some importance. But I would remind my friends from that province-and I take second place to none of them in my desire to protect its interests-that British Columbia has received splendid concessions on lumber which have already been of tremendous benefit to them. They have the assurance of free entry for shingles, which is of great importance to them. I would remind them that there are some provinces to which we cannot now ship our baby chicks, and I think that before we complain about the danger of competition from the United States we should get the Minister of Agriculture to unravel the problem of shipping our baby chicks within Canada; when we accomplish that, perhaps we can turn our attention to the other matter.
Perhaps we have slipped up on the question of potatoes. As I understand it, there is a duty on Canadian potatoes going into the United States, while United States potatoes come in here free. We have clarified the matter of seed potatoes, but the other question affecting potatoes is rather serious. I do not doubt that it can be rectified if the matter is carefully examined and placed in its proper light. No objection could be found to raising the intermediate duty here
Canada-U. S. Trade Agreement

if, after such examination, this was deemed desirable. I suggest it is a matter that should receive study and consideration.
I was rather amused at the reference to the furniture industry, that there -was a danger of our driving the furniture manufacturers of Canada out of business. The pathetic story of the furniture industry is pretty well set out in the price spreads report, from which I wild quote, because in my opinion the question of tariff has nothing to do with the matter at all. I will read just two or three extracts from the report of the prioe spreads commission with regard to the furniture manufacturing industry:
Coincident, however, with the growth of furniture factories was a concentration in retail distribution which led to the elimination of more and more independent outlets. In the city of Winnipeg during the past twelve or fifteen years approximately one furniture dealer per annum has ceased business and at the present time there remains only one dealer aside from the department stores.
The same story may be told of nearly every city in Canada. Then the report goes on:
... it became of paramount importance to every manufacturer to sell to the department stores. The concentration of purchasing power in the hand's of the latter undoubtedly intensified competition and accentuated the severity of the necessary adjustment.
I will ask the house to note what is said in conclusion, in view of the suggestion that the furniture industry is to be injured by a lowering of the tariff from forty-five per cent to twenty-seven per cent:
... this industry presents an illustration of a completely disorganized body of producers.... The field of retail distribution of the industry's product is, however, dominated by a few department stores, giving rise to a wide disparity in bargaining power between the producer and the distributor of furniture.


Mr. DEPUTY SPEAKER:: I regret to interrupt the hon. member, but already he has spoken for more than forty minutes.


Some hon. MEMBERS:: Finish.


Henry Herbert Stevens: With your consent, Mr. Speaker, I will finish:
The result of such disparity, combined with over-extension of production facilities, has been to drive prices to a point well below the proper cost of production with a consequent impairment not only of the manufacturer's capital, but of the standard of living of the wage-earner.
I refer to that particularly because it indicates that the question of the tariff has nothing to do with the welfare of that industry. It is a domestic question and a matter of their own practice in control of their own business.

Just in conclusion, sir, may I say that in my opinion the proper course to follow is to give this agreement a chance. Let us see whether it will work. The government has promised great things from this treaty, and the country is looking for great results. I would say to the government that the measure of success attained will depend largely upon the manner in which this agreement is administered.


Hon. W. E. ROWE (Dufferin-Simcoe):: Mr. Speaker, as this is my first opportunity to do so I should like to extend my congratulations to you and to the deputy speaker of the house upon your appointment to the high positions .which you occupy.
As I listened to the Minister of Finance (Mr. Dunning) and to the hon. member for Kootenay East (Mr. Stevens), I could not help but, think how great minds change. I well recall that when the Minister of Finance first came to parliament he entered this house as more or less of a free trader from western Canada. This afternoon, however, he reserved the right, when the intermediate tariff is dealt with in the budget, to revise it either upward or downward. 'Twixt the wheat fields of Saskatchewan and the lights of St. James street his policy has altered almost as rapidly as his location has changed. As I listened to the hon. member for Kootenay East, who also supported this proposed agreement, I could not help but recall the vigorous protectionist speeches made by the hon. gentleman in other days.


Henry Herbert Stevens: Hear, hear.


Mr. ROWE (Dufferin):: Now the hon.
gentleman is presenting an equally vigorous defence on behalf of the low tariff party. I am reminded of those words which have been set to music, "What a difference just a few years make." I am not surprised that one who has changed so often should perhaps prefer not to refer to the records of the two major political parties in this country.
May I say, Mr. Speaker, that I am glad to anticipate certain advantages which may accrue from the proposed agreement, but I am alarmed when I consider the serious dangers that threaten the economic life and national outlook of Canada. I have heard it said in the house that this achievement is the dream of Laurier Liberalism come true; I have heard it said that this agreement has been brought about through the good feeling that has been established between the two countries. No matter how much one might be tempted to do so, however, I do not think any hon. member on either side of the house should claim that his party is the only one

Canada-U. S. Trade Agreement
that desires a reasonable increase in trade with the United States. I have read many of the debates that have taken place in this chamber; I have listened to speakers on both sides for ten or eleven sessions and I am satisfied that ever since confederation every party in the house has had an underlying desire for a closer trade relationship with the United States. More than that, practically every party has made definite efforts to that end. Some have merely clamored for more trade on a free trade basis; others have advocated fair trade; others have supported reciprocity at any price, while still others have insisted that any agreement or reciprocity must be one that would reciprocate advantages to Canadians as well as to Americans.
I know that for a long time there has been a difference of thought as between high and low tariffs but, as someone has well said, any agreement is popular at its inception. Therefore I hesitate to forecast the ill effects that I believe may result from this agreement, because for a long time the idea of some such agreement has been very popular in the public mind. However, if there is any one thing more conspicuous than the spectacular manner in which this agreement was speedily ushered into this house, it is the evident lack of consideration that was given to it. Why, on the part of the right hon. Prime Minister (Mr. Mackenzie King) it was only a holiday affair; it took him only forty-eight hours to negotiate an agreement which for forty-eight years his party had failed to bring into effect.
I do not intend to go into all the details of this agreement. They have been well covered by my right hon. leader (Mr. Bennett) and well explained from the other point of view by the right hon. Prime Minister, but I feel in duty bound to point out to the house some of the general principles involved as well as the reason why I propose to vote against this agreement. I intend to express my lack of confidence in the fiscal policies of the Liberal party and to deal with a few of the details of the agreement which I believe threaten the economic independence and national outlook of this country.
It is true, as has been well said, that we live in close proximity to a country speaking our language, having the same customs, and with similar standards of living. Interchange of goods, views and even influence during the years has been much more convenient than would have been the case had our traditions been more foreign and our geographical location more distant. We find our trade has developed enormously; even without any agreements we have had an enormous volume of trade with the United States for many years. Canada
has achieved the unique position of being the greatest foreign customer of that vast republic. The Prime Minister of Canada has for many years been a champion of friendly relations with the United States and has repeatedly expressed the underlying desire of Canadians for the closest possible relations with that country. Little need be said about our peaceful relations with the United States; for over one hundred years we have maintained a relationship based upon a desire for international peace, a relationship closer than exists probably between any other two countries.
But it has been said, and said truly, that there is no sentiment in business; that statement I believe has never been challenged. I think it is equally true that bad trade arrangements and unsound trade policies have never improved relations between any two nations. There are in trade elements that are important and vital, and one of the most important is regularity and stability. We have no particular assurance of any stability, regularity or continuity of demand in trade with the United States. As I look back over our history-and I am not afraid to look back; I look back sometimes to get more light that I may see further ahead-and when I think of the trade agreement we had with the United States from 1854 to 1866, the oldest trade agreement and the only one that ever stood with that country, which was cut off abruptly, I read of how our pioneer forefathers were forced to struggle for their livelihood when they found that trade which had been established north and south suddenly cut off. Everyone knows that the cutting off of that trade was a considerable factor in bringing about confederation, and led to the establishment of a transcontinental railway and to a national fiscal policy, a national plan for our development east and west, because our fathers saw the danger of building on the shifting sand of a market controlled by another country. With that in view we find that immediately after 1866 when that trade was cut off these other developments that, after all, are the fundamental features of our national structure were established. From that day on, from Quebec to British Columbia, we have steadily developed our trade east and west; the transcontinental railways, which those who still desired trade north and south forecast would not pay for the axle grease, were made to pay and served the great provinces of the west, and that development east and west has been such as to make it possible for the Prime Minister, as head of the sixth trading nation of the world, now to negotiate with a great foreign power.
Among the factors involved in this issue are trade, transportation and employment. I
Canada-U. S. Trade Agreement

shudder to think of the effect upon our great transportation systems that are to-day operating with difficulty, when under this agreement trade is encouraged to flow north and south rather than east and west, when the short haul of the United States roads to serve western Canada from the cites of the central states replaces the haul from our eastern cities, which I believe it must be said in all fairness have done fairly well by assistance to the western provinces. It might reasonably be expected that north and south trade would develop markets for us when we remember that there are some 125 million people to the south of us while we have only about 11 million here, but I am amazed to find that in the last forty years we have purchased from the United States every year $150,000,000 more in value of goods than we have sold to them. Let us pause to imagine what that means, a total of $6,000,000,000, double the national debt, equal to the total agricultural production of Canada every six years. That is what we have paid for our trade with the United States, and we still owe them $1,000,000 in carrying charges on our debt every day the sun sets. This great trade has been established, why? Because the United States, just as in this trade agreement, have seen to it all down through the years that they supply us with the finished products of the labouring men of the United States and receive from us more in volume of raw products but less in value until processed by American labour. Not even the minister who smiles can deny that the advantages secured in this agreement, which are very small, are for our raw products and only to a very limited degree even at that.


Mr. CRERAR:: If my hon. friend will permit me, I was smiling at his speech, and wondering if he had been in favour of the agreement his leader tried to negotiate.


Percy John Rowe: I can only say that I have followed my leader longer than the hon. minister has ever followed any leader. I believe in trade east and west, trade that will develop Canada for the Canadian people. I have no apology to make for any of our slogans in the past, no apology for any of our policies in the past, no apology for the encouragement of trade that assists our own ports instead of American ports, no apology for policies that assist our own labour rather than American labour. I have reason for lacking confidence in the present government's fiscal policy, because even you, Mr. Speaker, before you dropped your political affiliations, realized full well, looking back over the path-
way of Liberal fiscal policy that it was a path strewn with fear, failure and uncertainty. When I think of its winding, changing course in the fiscal affairs of this dominion, I say "fear" advisedly. The Prime Minister smiles. I do not mean to say that he is fearful under all circumstances. I have seen him quite brave in parliament; I have seen him quite brave in the country, and I congratulate him upon his success. But I find as I look back over the record that Hon. William Lyon Mackenzie, and his former leader, Sir Wilfrid Laurier, warned us against trade policies that would annoy or irritate the United States. Then prior to 1930, when American tariff increases were being discussed and the present Prime Minister was urged by those on this side of the house to raise our tariffs against the United States I remember him saying: No, we must not do anything for fear it might be considered provocative in the United States at this time.
When the Prime Minister spoke a few days ago he went into details, covering two pages of Hansard, in outlining his policy of fear, in which he stated that if we did not negotiate the agreement immediately, the United States threatened to retaliate; that they would raise their tariffs, placing them in the general column, an innovation in tariff practice which the right hon. gentleman explained. He said, further, that apart from the treaty he was fearful that the United States might retaliate by higher tariffs unless we reduced our tariffs in some way or made it possible by our intermediate tariff arrangements and regulations to allow trade to come in through American as well as Canadian ports. In the view of the right hon. gentleman to do otherwise might be costly to our newsprint industry, in that newsprint might no longer be exported to the United States unless we accepted this agreement.
To-day as I listened to the Minister of Finance it appeared to me that evidently he has been contaminated by that feature of the policy, and that he was also fearful of retaliation from the United States. When we consider the history of Canada all through the years we find that more or less that has been the policy of the Liberal party endeavouring to consummate United States agreements; that all through the years they have emphasized to a greater or lesser degree that we should not irritate or annoy that country. We received the warning about not being provocative to the United States at a time when we were buying a million dollars worth of goods more from them each day than we were selling to them. Canada changed

Canada-U. S. Trade Agreement
her favourable trade balance of over S400,-
000.000 in 1926 to an unfavourable trade balance of over $100,000,000 in 1930. During that period we did not increase our unfavourable trade balance by $150,000,000, as was mentioned previously, as an average, but were buying over $300,000,000-in fact, in 1929 I believe it was over $400,000,000-more from the United States than we sold them. The Prime Minister knows as well as does any other hon. member that during those years almost half a million of our boys and girls went to the United States to find employment.
These are serious national matters, of great concern to the dominion. I know it would not be expected by hon. members to your right, and overflowing to your left, Mr. Speaker, that I would have much confidence in the fiscal policy of the Liberal party. But I say in all kindness to each individual of that large, unwieldy and possibly temporary force that the policy of their party so far as trade relations are concerned has changed many times. I have read where leaders as great as Hon. George Brown left the Conservative party, after the government of that day tried so hard to renew the treaty that had been cut off in 1866. He left it and joined the Liberal party because the late Sir John A. Macdonald offered too much on behalf of the Canadian government. Later, that same Liberal party, which at one time thought not enough was being offered and another time thought we offered too much, changed to unrestricted reciprocity. Then later, by name alone it followed a policy of commercial union with the United States. On down through the years we find those different suggestions dying; one by one; some died in parliament; some died in congress; some died before they got to congress and others died in the country. In 1911 reciprocity died before the vote of the people, and I venture to say that if this trade agreement were presented to the Canadian people in the light in which it has been presented to this chamber it would not carry a majority of the votes of this country to-day.
One could name many more instances, but I would hesitate to do so. We know however that such a great leader of the Liberal party as Sir Richard Cartwright took a definite stand in the matter. One can trace a changing Liberal doctrine all down through the years. The late Sir Richard Cartwright said that we must have unrestricted reciprocity with the United States, no matter what the cost may be. He said, "We will have it, no matter what the cost is." Twitted in parliament and asked
if he did not think this would affect our trade with the United Kingdom he said, "Yes, and the only way to get it is by raising your tariff all along the line against every country on the face of the world, even the United Kingdom as well."
Well, to-day we find the doctrine of the Liberal party has been emphasized, and was emphasized particularly during the election. To-day that party is one which stands for the lowering of tariffs all along the line, a policy which is proposed by the right hon. the prime minister to be the only proper basis for trade negotiation. I pause to urge hon. members to watch carefully the budget which will be brought down by the Minister of Finance, in view of the fact that to-day he told the house that he reserved the right to raise or lower duties. As a one time free trader he now stands as a protection valve, to repair tariffs lowered by his leader. He now stands ready to apply emergency measures he may consider necessary to restore an equalizing effect upon Canada in view of the situation brought about by the freer trade inclinations of the Prime Minister. I know many other changes, and especially the ones respecting the imperial trade relationships, could be mentioned.
While the late Sir Richard Cartwright would even tax Great Britain in order to have trade with the United States, Sir Wilfrid Laurier said, "There shall be no more pilgrimages to Washington," and he turned his attention to the motherland. What did he do? He gave a preference to the motherland, and did not ask anything from them. Yet to-day the Prime Minister-


An hon. MEMBER:: And Sir Wilfrid Laurier was opposed by the Tory party when he did it.


Percy John Rowe: Certainly he was opposed by the Tories; the new member is right. He was opposed by the Tories and by Right Hon. Sir Charles Tupper. Sir Charles Tupper stated that he believed in reciprocal trade arrangements with the old land, as well, which would give equal advantages to Canada and England.


An hon. MEMBER:: Knowing he could not get it.


Percy John Rowe: My hon. friend should look back and remember what happened. The present leader of the government knows that between 1899 and 1905 one-third of the textile industry of Canada went out of business and thousands lost their jobs because the late Sir Wilfrid Laurier was too generous to England, and had he followed Sir

Canada-U. S. Trade Agreement
Charles Tupper's advice the textile industry of Canada would not have received the death blow she did receive at that time.
The present prime minister did not suggest that we should give the motherland preferences and receive nothing, but he refused to support the present leader of the opposition (Mr. Bennett) who brought the imperial trade agreements before this chamber. He refused to support a preference for England when Canada was securing more by way of preference than the late Sir Wilfrid Laurier ever expected to receive or any Canadian had even hoped for. When I speak about the imperial trade agreements I notice the Prime Minister laughs, but my reply is that he who laughs last laughs best. If he and I are spared for two or three years-and I hope we shall be-we may have an opportunity to compare the advantages derived from the imperial trade agreements with the disadvantages Canada will suffer from the Canada-United States agreement now before us. Keep my words in mind, because I say to every hon. member within sound of my voice that if he has given any thought to the imperial trade agreements he must agree with me that had it not been for them agriculture, the great basic industry of Canada, would be bankrupt to-day. I urge hon. members to consider that point carefully.
The hon. member for Danforth (Mr. Harris) placed on Hansard details which I shall not repeat. I shall be content with saying that the advantages we secured in the motherland had the effect of stabilizing our markets. I shall mention only one example of stabilization, although in fact many could be cited. There is not an hon. member experienced in agriculture who would not agree with the statement that since the imperial trade agreements became effective we have had a more stabilized price for bacon than at any other time since confederation. Any farmer knows what that means. Even the Minister of Finance himself, who 'has been removed from the pursuit of agriculture for some time, will agree that there is nothing more important for the Canadian mixed farmer than a stabilized price for his products. But the imperial trade agreements did not do only that. They provided us with advantages in the greatest market in the world, and the one in which we can hope for the greatest stability.
What have we received in this agreement? As I listened to the hon. member for Kootenay East (Mr. Stevens) I wondered why he should have a change of heart now and accept this agreement as something that was going to bring great benefits to Canada. Lumber has been mentioned. It is true that

under this agreement we can send our lumber to the United States at a lower rate of duty, not free but at a reduced rate, and then only in limited quotas, but in return we tell the manufacturers of the United States that they can ship their furniture into Canada, not in limited quantities, but as much as they like, free of duty.


Mr. ROSS (Moose Jaw):: No,


Percy John Rowe: At a reduction
from forty-five to 27| per cent.


John Gordon Ross: That is not
free.


Percy John Rowe: to the free traders of the west and a wink to the protectionists of the east, and leave his course ahead as uncertain as it has been behind him. He may derive temporary benefit from that, but I would urge upon the Prime Minister to forget some of his pre-election speeches with reference to dumping duties and seasonal tariffs, and that he may reconsider the abolition of section 43. I hope he may not say to Japan that "of a class or kind produced in Canada" means a ten per cent production in this country. It may be that he will change many of these items and avoid these dangers to which I have referred. If he does not I only wish to point out to him that if in the next year or two he fulfils the pledges and promises he made prior to the last election, then he will have prohibited many new industries being born in Canada and will have injured the old ones already established. I think that should be said in fairness to the right hon. gentleman, in fairness to his government and in fairness to this country.
If we establish trade north and south we shall be faced with the advantages that are given to American labour and the advantages that accrue to the American manufacturer because of his mass production and short rail hauls. We are telling the American magazine publishers that they can ship to this country hundreds of thousands of their magazin.es containing a culture not our own, teaching a patriotism that we know nothing about and telling us of a national outlook that is not our own. We are embarrassing the renewal in 1937 of the imperial trade agreements. It would be better if we were establishing our trade in an east and west direction; we should endeavour to maintain the more stable imperial trade.
I ask the Prime Minister to reconsider some of the intermediate traiff concessions he is giving to the United States. These concessions cover a number of articles from the southern states similar to those now being brought in from British countries under the imperial trade agreements. I am sure that when he attempts to renew the imperial trade agreements he will find it most difficult to do so because of this change in the direction of our trade to north and south. If this course is continued the stability of our trade, the interests of agriculture, and interests of the Canadian people as a whole are seriously endangered. The right hon. the Prime Minister said the other day it would have been much better if the imperial trade agreements had never been made, so far as securing the United States agreements was concerned.
I wish the government Godspeed in turning from the errors of their ways. I urge the [Mr W. E. Rowe.]
right hon. gentleman still to look east and west as did his late leader, the Right Hon. Sir Wilfrid Laurier when he too turned to the motherland. He should beware of the north and south route which has been so uncertain in the past.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.



CRIMINAL CODE

[Stage Direction]
Mr. T. L. CHURCH (Broadview) moved the second reading of Bill No. 5, to amend the criminal code (fines and penalties).
He said: Mr. Speaker, the object of this particular bill, copies of which are on mem-bler's files, is to provide that fines imposed under the criminal code may be paid on time or by instalment, the conditions to be laid down by the magistrates or judges after inquiring into the ability of the accused to pay. Owing to five years of depression many people on relief and out of work, or on part time, many of them first offenders with families and some of them returned soldiers, cannot pay their fines, and have to go to gaol,- which is another way of imposing imprisonment for debt. The bill follows the provision of the law of England, 1935, 25-26 George V, chapter 46, known as Money Payments (Justices Procedure Act), 1935.
The first section of the bill is partly new matter; the other sections are entirely new. The first section in the bill amends section 1029 of the criminal code, "fine or penalty in discretion of court":
Wherever a fine may be awarded or a penalty imposed for any offence, the amount of such fine or penalty shall, within such limits, if any, as are prescribed in that behalf, be in the discretion of the court or person passing sentence or convicting, as the case may be.
Sections 1036, 1037 and 1038 of the code deal with fines and forfeitures.
The first section of the bill is entirely new, and all the other sections follow the law of England. This matter came up in Great Britain two years ago. It was dealt with by a committee of parliament and a departmental inquiry, and this particular act which is now the law of England came into force on January 1 and is working well in the old country.
During times of depression people get out of work and, if convicted, cannot pay their fines, with the result that they have to go to gaol. Many of them have families.

Criminal Code-Fines and Penalties
The British Money Payments Act was introduced in the House of Lords on July 11. It went over to the House of Commons on August 2, and received the royal assent. It was supported by all parties in both houses of parliament, and the judges who took part in the debate in the House of Lords spoke strongly in favour of this measure. This whole question, Mr. Speaker, is wrapped up in the liberty of the subject, and after all is said and done, Britain is the only country in which there is real liberty to-day.
As I view the situation, the term "liberty" is becoming meaningless in Canada, with imprisonment of thousands for debt, with trial by newspaper supplanting trial by jury, with the difficulty of getting bail, with the almost kingly powers which parliament and the provinces have conferred upon magistrates. It is all right to read of a conception embodied in text-books on the law of evidence two or three hundred years old, but it needs to be brought up to date and rewritten, when you have a magistrate committing a man for trial, a grand jury finding a prima facie case is made out on the facts, and along coming a judge who, not satisfied with telling the jury what the law is-which is his proper function-takes the case from the jury, often supplanting trial by jury. We have cases about the fourth estate affecting reports of this parliament, reports of committees; freedom of the press is assailed openly in Canada to-day.
This bill deals with an important question of law reform. It is one of the greatest problems affecting this country at the present time. Law reforms here are away behind the times; we have to go to the motherland, the land of the free, and see what they are doing over there. We find they are getting back to the principles of magna charta, the principles of the Petition of Right, following right away down to the statute of Westminster. Throughout we find the principle of the liberty of the subject. In Canada the liberty of the subject does not extend very far. Certain people outside this house can snap their fingers at parliament; they can even say to a newspaper "We will cut off your advertising if you dare to publish the truth, or publish what goes on in the debates of this house or its committees."
I do not ask that the government shall immediately adopt this bill. I believe we should follow the procedure of the mother of parliaments, in which, prior to the act to which I referred last August being placed on the statute books, it was admitted that the case was proven and they appointed a
departmental committee. Besides having as its chairman a distinguished lawyer, Sir John Fischer Williams, K.C., the committee also comprised a former chairman of the prison commission, a former metropolitan magistrate, . a leading stipendiary magistrate and a justice's clerk. They went into this whole question and presented a report to both houses of parliament, with the result that this act was placed on the statute books of the motherland. I think we should do well to have the Minister of Justice (Mr. Lapointe) appoint a parliamentary committee or a departmental committee to deal with this whole problem of law reform.
After all is said and done, what is Liberalism? As we have it to-day it does not exist along these lines, when we see that "liberty" is just a meaningless term in this country. As I said, this bill is wrapped up with the liberty of the subject. Imprisonment for debt was abolished in England and Wales by act of parliament in 1869; yet in 1923, according to a report of the House of Lords, 23,000 people were imprisoned for failure to pay sums of money. In 1910 the number was 90,000, although imprisonment for debt had been abolished for forty years. Figures show that only twenty-seven per cent of the men and twenty-one per cent of the women imprisoned in England had been convicted of indictable crimes; the rest had made default in payments of money and had been convicted of breaches of various acts, regulations and bylaws with respect to which imprisonment with or without the option of a fine could be imposed.
When a man is sent to gaol in default of payment of a fine he is not the only person who suffers. His family suffers; his children suffer through the bread-winner being in gaol; his reputation suffers; he may lose his job, and then it is hard for him to get another. In England last year 11,000 people had to go to gaol because they were unable to pay fines. An attempt has been made to remove this state of affairs through the new statute to which I have referred.
The bill which I propose will need the support also of the provinces. It deals with offences under the criminal code just as far as the legislative competence of this parliament goes. In addition, the provinces should pass complementary legislation. The practice at present is as follows: A fine is first imposed. Under my bill there will be an amendment whereunder the fine will be fixed first, and if default occurs in payment an inquiry will be made by the judge or the magistrate as to the ability and capacity of the defendant to
[Stage Direction]
Criminal Code-Fines and Penalties
pay, and his means in relation to the amount involved. A prison term will be ordered only if the court thinks it wise. That is modern, humane legislation.
As a result of a similar law, Mr. Speaker, half the prisons are closed in the old country, at a great saving to the state, for seventy-five per cent of persons in English prisons were imprisoned for debt and only about twenty-five per cent for indictable offences. Imprisonment is a most expensive luxury for the state. Also it is harsh and severe in its consequences to the individual; it has a bad effect upon a man's character and his self-respect. It causes suffering to his family and dependents, interruption of his work, and the possibility of failure to find work upon his release- penalties often out of all proportion to the wrong which the offender has committed or the fault of which he has been found guilty. Such a penalty should never be imposed without careful consideration and only resorted to if it is the only practical way of vindicating the law of the land or enforcing obligations which must be enforced. It should never be imposed in the mechanical or autocratic way that prevails at present.
The peak of imprisonment for debt in this country seems to coincide with times of great industrial depression. The figures indicate this clearly. It is most regrettable that unemployment should result in the imprisonment of men because they are unable to fulfil obligations contracted for when they were at work; that they should be forced to comply with a court order which is based upon their earnings when they were employed. I think it is also regrettable that there are so few methods of dealing with offenders; that such methods are limited to the ones used three hundred years ago, namely, fines and imprisonment.
In his work The New Despotism, Lord Ilewart has referred to this matter. It seems to me that at last the British government has written finis to Little Dorrit, Dickens' novel criticizing the conditions he described a century ago, from personal knowledge of the debtors' prison in London. Little Dorrit herself ministered there, and of the conditions Sam Weller said, "It's unekal, and that's the fault on it." In 1869, stirred by Dickens' description of these conditions, the government of England brought down an act prohibiting imprisonment for debt. Nevertheless to-day nearly half the commitments to prison, though nominally on account of what is known as contempt of court, are actually for non-payment of money liabilities.
The action now being taken is intended to change this state of affairs. First the gov-

eminent appointed a departmental committee; then the matter went to the House of Lords and the House of Commons, and the bill passed both houses unanimously, and was supported by the press all over England. They circularized the magistrates and judges and obtained full information before the act was passed. I should like to read one or two press clippings in regard to this matter:
The Earl of Faversham announced this on behalf of the government in the house of Lords. The government's object, Lord Faversham said, was that there should be "no delay whatsoever in bringing to the notice of all courts of summary jurisdiction suggestions and considerations which may tend to reduce the number of imprisonments and may assist courts to confine the use of this extreme measure to eases where it is unavoidable if the authority of the courts is to be properly upheld."
This statement was the climax to a debate initiated by Lord Arnold, Labour party peer, who called attention to the report made last autumn by a government committee on this question. Lord Arnold said that in 1932 no less than 24,272 persons in the United Kingdom were sent to prison for non-payment of fines, maintenance orders, local taxes and other monetary demands.
In one case, he said, a youth was sent to prison as the indirect outcomei of swinging in a public park in the wrong swing. The young man had been fined. He was careless, and because the fine was not paid, and _ perhaps could not be paid, he had to go to prison. In another, a man was similarly imprisoned for failure to pay a fine imposed upon him for sleeping in an automobile upon a public road.
Baron Merrivale, a lord justice of appeal, confirmed the fact that such a state of things existed. It had come to an end practically for well-to-do people a century ago. Lord Merrivale said, but it had not come to an end for "the poor people who are the subject of these various orders."
Baron Snell, late member of the Imperial Economic Committee, pointed out that Britain has much to learn on this question from the United States. "When I was in America a year or two ago," he said, a judge of the supreme court was good enough to express to me in the most emphatic way his admiration and the admiration of American jurists generally for the common law of England."
In this parliament we should always be on our guard in order to do nothing that will take away from the liberty of the subject. When we look at Europe, where there is no longer any liberty in the legislatures, the press, the pulpits or the universities, more than ever we should stand on guard to see that the principles of magna charta are not violated. They are being violated in this country to-day; in fact I should like to know where the magna charta exists at the present time. The development of this liberty took many centuries; it was achieved at great cost both individually and to the state. One principle of the great charter was that no free man should be arrested or detained in

Criminal Code-Fines and Penalties
prison, or outlawed or banished or brought to ruin, save by the judgment of his peers and in accordance with the law of the land. On the other hand we have taxation without representation, and liberty is being restricted all along the line, with the vast powers now enjoyed by the magistrates, with the jury system supplanted by newspaper trials and all that sort of thing. Where is the Magna Charta when people are sent down for nonpayment of small fines?
Our whole system of freedom, as we have it to-day throughout the British empire and the United States, is based upon the subjection of the executive and its ministers to the law of the land, and one of our cardinal principles is that the courts are subservient to the legislature. Look at the United States; where is liberty there? What has happened to the liberty of the subject over there? In this country, too, those ties which bind us to the motherland seem to be weakening. In the United States they suffer from politics and lawlessness, kidnappers, racketeering and all that sort of thing, and to a certain extent we suffer from the same conditions. The square deal of Theodore Roosevelt and the new freedom of Woodrow Wilson 'have been absolutely swept away. So much is this the case that a distinguished citizen of the United States, Colonel Lindbergh, had to leave the land of the free and the home of the brave for a really free country, the only one in the world to-day.
I would suggest to the minister that he follow the practice that has been followed in the old country, and institute a departmental inquiry into these questions. He is a very efficient minister, and he has always been receptive to suggestions coming from the opposition, though it is true that he sent the new deal, the new freedom, to the law courts. In this country, as I say, the courts are subservient, or should be, to the legislatures, and I believe the time is not far distant when we shall have to reassert the principle enunciated by Theodore Roosevelt at Chicago in 1912, when he said, "The American people, not the courts, should determine their own policies." The court of last resort is 'the people, and this high court of parliament could accomplish no greater work than to protect the liberty of the people. This should be even more so now that we have twentieth century Liberalism in Canada. I am afraid, however, that twentieth century Liberalism and economic Liberalism in .this country are nothing but myths.
I hope the minister will give serious consideration to this bill, which is patterned after
the English act now in force. I should be glad to send the minister a copy of the English bill, which is contained in a book entitled Imprisonment by Justices for Non-Payment of Money, written by Wallace Thoday, who is a member of the bar, and published at Mansion House, London, December, 1935. I suggest that in this connection the minister should consult the municipalities also, because after all is said and done the municipalities, rather than the provinces, should receive all the fines. All fines levied under the criminal code should belong exclusively to the municipalities. Parliament gives the provinces subsidies for the maintenance of provincial institutions, while the municipalities have to maintain the .police forces, which in some cities cost .two or two and a half million dollars. Australia gives a subvention to her capital city for the maintenance of the police force there. A few years ago parliament conferred upon the provinces the right to collect these fines, subject to an agreement to be made with the municipalities. Some fines go to the provinces, many to the municipalities, but all these fines should go to the municipality, to the authority which not only enforces the law but prosecutes.
In my opinion the time has come for reform. I should like to hear from the minister whether he is agreeable to acting along the line taken by the mother of parliaments, where they found a condition under twentieth century Liberalism that 24,000 people were in prison for non-payment of debt. In any event during the depression there should be a suspension of imprisonment for non-payment of fines, and time given to pay. Before a fine is imposed this bill provides that a magistrate should make inquiry as to the ability of the accused to pay. It is not only the man himself who suffers; if he loses his job the wife and family suffer. In Toronto forty-five years ago the late R. J. Fleming when chairman of the board of police commissioners passed a by-law allowing the police inspector discretion to release a man arrested for drunkenness, with the result that he could go to his work in the morning. By that humane provision he saved many a family from suffering. I hope the minister will be in a receptive mood and follow the example of the motherland. If he admires Liberalism as they have it in the old land let him follow them in that respect. The government of the day is responsible to the electors of the country for bringing about such necessary reforms. These reforms are in the public interest and protect the liberty of the subject, which is becoming an almost meaningless term in this country.
[Stage Direction]


Criminal Code-Fines and Penalties
Hon, ERNEST LAPOINTE (Minister of Justice): The main section of this bill, which is section 1, would give discretion to a court or to a person imposing a fine or penalty to allow time for the payment of that fine, and even to order that the amount may be paid by instalments, at times, in amounts and under such conditions as the case may require. This is the most important section of the bill. Fundamentally I do not see any objection to the principle of this section. I understand that certain magistrates even now purport to do this although there is no statutory authority that allows it. But the difficulty would be to devise a law which, while giving this discretion in cases where it may be properly exercised, would have the necessary safeguards to prevent those who could pay from escaping part of their sentence.
Ini 19291 there was introduced in the other house by Senator Beaubien a bill of this kind containing exactly the same provision as appears in this section. I have before me the debates of that year in the other house, and there were objections raised to that provision. The bill was withdrawn. I call attention to the fact that in the explanatory note to the bill now before the house my hon. friend says that this legislation is advisable owing to the five years of depression which have caused many people to be on relief or out of work. The bill in the other house was introduced in 1929, at the peak of the boom. At any rate the principle of my hon. friend's bill is not entirely new. But as I say, there is nothing which seems specially objectionable in this provision so long as the section is drafted in such a way as to provide all necessary safeguards.
Section 2 of the bill provides for new sections 1029A and 1029B. I must confess I cannot see that those sections would be very valuable, and there are objections to them from certain viewpoints.
As to section 1029C, if the first section were accepted this should be accepted also. It provides that when a convicted person would have paid part of the penalty, if he could not pay the balance and had to serve a term in gaol, the term of imprisonment should be reduced because of the amount of fine he has paid.
As to section 3 of the bill, which would enact two new sections, 1057A and 1057B, I would not only be inclined but have to oppose this section. By section 1057A a court which has power to pass a sentence of imprisonment^
-in lieu of passing a sentence of imprisonment, may order that the offender he detained within the precincts of the court, or at any police station, till such hour, not later than eight in the evening on the day on which he is convicted, as the court may direct.

And the court-
-shall not make any such order of detention under this section as will deprive the offender of a reasonable opportunity of returning to his abode on the day on which such order of detention is made.
Well, I am a friend of liberty, as my hon. friend is, but this would be almost killing the offender with kindness. If I correctly understand this section the court would not even sentence the prisoner-or he is not a prisoner, because this is for the purpose of preventing him from going to gaol-but instead of passing sentence the court would merely order that he be detained within the precincts until not later than eight o'clock in the evening.
The hon. member said that the bill before us is based upon the English Money Payments Act of 1935. I suggest however that it goes much further than the English act. Under that act the court which has adjudged the sum to be paid by the accused, in lieu of issuing a warrant immediately may order that he be detained in the police station until he can obtain the money to pay the amount of his fine. In the proposal of the hon. member, however, there is no such provision. Instead1 of passing sentence on a man the court would simply order that he be detained "within the precincts of the court, or at any police station, till such hour, not later than eight in the evening on the day on which he is convicted." I do not think it would be worth while for any person to make a complaint and secure such a conviction.
Then, section 1067B is along the same lines. It would enact that:
(2) Where a person is liable to be sentenced to imprisonment by a court of summary jurisdiction, the court may, if any suitable places are available for the purpose, order the person to be detained within the precincts of the court or at any police station for such period not exceeding four days as the court thinks fit, and the order shall be delivered with the offender to the person in charge of the place where the offender is to be detained.
That section would prescribe that no person shall be sentenced to imprisonment for a period of less than five days. When the sentence is less than five days, the judge would order that the person be detained within the precincts of the court or at a police station, instead of going to gaol. I must object to the two proposal® contained in section 3 of the bill.
I suggest to the hon. member, however, that in Canada the administration of criminal justice is under the control of the provinces. The officers who have the experience in these matters are the attorneys general of the various provinces. They are the officers who are responsible, and I should like to submit

Canada-U. S. Trade Agreement
to the law officers of the different provinces the proposal contained in the hon. member's bill. Upon consultation with them it might be possible, as I stated before, that section 1 and part of section 2 might be accepted. Either such provisions might be included in the bill which will be introduced by the government to amend the criminal code or, if the hon. member would prefer, his bill might be allowed to stand until I receive the advice of the various legal authorities of the provinces as to the merits of the provisions in the bill. Under those circumstances we would be able to proceed and give to the hon. member the amount of satisfaction his proposal deserves.
Mr. CHURCH:: Mr. Speaker, I gladly accept the suggestion offered by the minister. As I said before, I did not expect the bill would be passed until such time as it had been considered by the provincial attorneys general and by officials of municipalities as to how it may affect the payment of fines. I would be the last person to propose interfering in that regard, 'because I have always contended that fines belong to the municipalities. I would suggest that the bill stand over, and that the minister incorporate it in the general amendments to the criminal code which will be brought down later in the session. Meantime the minister could consult representatives of the provinces.
On motion of Mr. Lapointe (Quebec East) the debate was adjourned.



POST OFFICE ACT

[Stage Direction]
Mr. OSCAR L. BOULANGER (Belle-chasse) moved the second reading of Bill No. 8, to amend the Post Office Act.
Walter Edward Foster: Before the bill is read
a second time, I must draw the attention of the house to the fact that I do not think it is in order.


Mr. BOULANGER:: I have been asked
to let the bill stand. I have no objection.


Walter Edward Foster: Stands.
Motion stands.



CANADA-UNITED STATES TRADE AGREEMENT PROPOSED APPROVAL SUBJECT TO LEGISLATION MAKING PROVISIONS EFFECTIVE

[Stage Direction]
The house resumed consideration of the motion of Mr. Mackenzie King.
Mr. J. A. GLEN (Marquette):: Mr. Speaker, I do not know where the hon. member for Danforth (Mr. Harris) will place
me, after I have finished speaking, whether he will put me on the gangway which he has created, or in some other place. I am sure, however, that he will know exactly where I stand, and what I think about the trade agreement now under discussion.
While I have no further observations concerning the hon. member for Danforth I have one or two respecting the hon. member for Dufferin-Simcoe (Mr. Rowe). In the first instance he took exception to the speech made by the hon. member for East Kootenay (Mr. Stevens). He recalled some protectionist speeches which in years gone by had been made by that hon. member. I could not help thinking that had the fortunes of war favoured the Conservative party and had they been sitting on the right side of Mr. Speaker the hon. member would have been one of the first to have echoed the speech made by the hon. member for East Kootenay, and would not have been deploring the fact that we have a treaty giving us trade relations with the United States.
He spoke, further, regarding the haste displayed by the Prime Minister (Mr. Mackenzie King) in consummating and completing the agreement. If the Prime Minister had delayed much longer and if the agreement had not been completed and we were not discussing it at this time I can assure hon. members that the hon. member for Dufferin-Simcoe would have raised his hand in holy horror because of the delay of the Prime Minister in completing an agreement so far advanced by his own party.
If in my observations I have to deal with statements already made I do so because this seems necessary from the western standpoint, and I do not use the term in a parochial sense but rather from the point of view of the dominion. The debate of this measure seems to me somewhat like preparatory service to the communion on the budget. Most of those who have spoken have been dealing with the matter from that standpoint, as a preliminary to the budget, because you will find, Mr. Speaker, that most of the remarks are addressed to the Minister of Finance (Mr. Dunning), and he is somewhat . on the defensive and is endeavouring as best he can to conceal his thoughts as to what might be contained in the budget.
There is one feature of this debate, however, that I am rather glad to see, and that is that we have an opportunity of discussing the principles of protection and free trade so early in the session rather than on the eve of an election, and in this debate, before we are through we shall find just what are the bases of the principles upon which each of the

Canada-U. S. Trade Agreement
parties made their appeal to the country. I do not know whether ever in the history of Canada before there has been a situation such as we have here where the leader of the opposition (Mr. Bennett) has made to a neighbouring government proposals along the lines of a treaty. The only parallel that I know of is one which took place, I think in 1867, when Mr. Gladstone through his government was introducing an extension of the Franchise Act, which Mr. Disraeli was then opposing. In the subsequent election, and chiefly on the ground of his opposition to the Franchise Act, Mr. Disraeli was returned to power, and then when he came into office, with a cynical indifference to consistency he passed that very bill of Mr. Gladstone's and, in fact, extended its provisions. In the present case the situation is somewhat different. The present leader of the opposition had as Prime Minister made certain proposals to the United States government and these proposals had Seen under consideration for some considerable time by the permanent officers of the two governments and by the then Prime Minister himself. For some reason or another the response that was made by the United States was not such as the then Prime Minister wished. Then when the late government was turned out on October 14, a new Prime Minister took office, and with the sanction and the entire concurrence of the people of Canada he immediately approached the United States government with a view to a trade treaty. In that treaty he was able to embody a great many of the proposals set forth by the present leader of the opposition, and the present Prime Minister was able to complete the treaty within a remarkably short time.
May I say that in my judgment it might have been well if the leader of the opposition had taken the position that Mr. Gladstone took when Mr. Disraeli's government brought in the franchise bill. Mr. Gladstone supported it, and I do think the leader of the opposition might have been well advised to approve this treaty as he certainly had a great deal to do with its framework. However, he did not do so, and so we are met with his opposition to the bill, which opposition has been replied to in extenso, I think, by the Minister of Finance (Mr. Dunning) to-day. The Minister of Finance to-day gave to the house these uncontroverted and incontestable facts, that the provisions of the treaty were initiated in the proposals of the leader of the opposition, and that, despite what was said by the leader of the opposition in his speech the other day, these proposals have been completed by this government.

I remember hearing the leader of the opposition make a radio address last September. It was the only address I heard him make during the course of the campaign, and it was given, I think, on a Friday or Saturday night. This is what he said-I have a copy of his remarks here:
You say: "But you have not mentioned the trading situation with the United States." I have not, but I now will. It has been said by my opponents, and particularly by my opponents in the west, that the Bennett government did not desire to trade with the United States, that the Bennett government had no realization of the need of securing for our primary producers greater markets in that great country, and that therefore we were making no effort to obtain them.
It was said that we had a brief for the industrialists and didn't care a hang about our agriculturalists. And that consequently we were just going through the motions of trading with our good friends to the south.
Well, that does not happen to be the ease. Ever since this government has been in office, it has done everything possible to increase our trade with the United States. We have consistently expressed our willingness to give concessions for concessions granted. Before June, 1934, by the then only practicable means available, we did all that was possible to secure greater entry for our natural products in that great market. When, in June. 1934, Congress gave to the president of the United States powers to conclude trade agreements, this government was eager to take advantage of what it regarded as this new and better opportunity to increase its exports. It acted accordingly. Note this fact carefully. What specifically this government did. and the nature of its proposals, will be made knowrn to you through the publication of a certain document. This publication will be made on Monday next.
This document will be my answer to the unfair-minded people who, knowing better, still maintain that this government has never seriously attempted to do business with the United ' States. Set up the statements of my political foes against the written statement which you will read; and learn in time how little dependability can be put upon the words of the leaders of Liberalism.
So much for that, to-night. But carefully examine this document.
Well, it happened that I was addressing a meeting that night, and I ventured into the realm of prophecy, as a rule a very unsafe place to tread. I then stated on that platform, as I stated on every platform during that campaign, that there would be no trade treaty with the United States through the instrumentality of the then Prime Minister. I said that he would make the approaches, but he could not and he would not give the concessions that would be demanded by the president of the United States.


Richard Bedford Bennett: Hear, hear.


James Allison Glen: I further stated on every
platform that there was only one party and only one man in the dominion who could

Camda-TJ. S. Trade Agreement
complete a trade agreement with the president of the United States, and that party was the Liberal party, and that man was the present Prime Minister (Mr. Mackenzie King). I stated my reasons also. I said that I knew something of the mentality of the right hon. leader of the opposition. I knew the environment in which he had lived during most of the years of his manhood; I knew from his speeches in the house and on the hustings that there was no possibility of any agreement being consummated by him just because of his mentality. He had indicated that in the house and in committee.
Some hon. members who were in this chamber at the time will remember that when the grain board was being constituted and the leader of the opposition's own friend, Mr. James Richardson, was giving evidence, Mr. Richardson stated that he could sell fifty million bushels of grain at seventy cents a bushel, whereupon the chairman of the committee, the right hon. leader of the opposition, said, "What then?" The reply was that we must purchase the goods of those countries in which we sell our wheat. The leader of the opposition replied: "The same old story," that the goods of the industries of the United States would flood the markets of Canada. At that particular moment, when they were dealing with the affairs of the farmers of Canada, the then Prime Minister made it absolutely clear to the country that what he was concerned with was the rights, as he thought, and the privileges of the industrialists. I think the statement that he made in his radio address that they were concerned only with the industrialists was entirely true because he has consistently taken the position that he has saved Canada during the last five years; in the saving of Canada he has pointed to the protection that he has given to the industrialists of the east, and in that way he believes he has saved Canada.
I am going to suggest that the leader of the opposition is not a very good logician. I remember when I was studying logic it was always clearly brought to my attention that you could never draw a universal conclusion with a minor premise in the syllogism. He has taken the position and he has drawn a universal conclusion with a minor premise because he has said that protection is necessary to save Canada: I have given protection to the industrialists, therefore I have saved Canada. I think that is fair oomment and I submit that was entirely the policy and program of the leader of the opposition during the whole of those five years. I suggest to my right hon. friend that he again pursue
the study of logic. He will find it useful in dealing with these matters.
The Prime Minister said that immediately on attaining office he would proceed to deal with the United States in connection with a trade treaty. He made no promises in his speeches, but the platform of the Liberal party did invoke wider markets for the people of this country. In fulfilment of the intimation that he would proceed to deal with the United States the Prime Minister met Mr. Armour, United States minister, the day after the present government was sworn in. During the election certain people were saying that there was no difference between the Liberal and the Conservative party. I think this is an illustration of the real difference between the two parties. We saw a former Prime Minister making promises which were not fulfilled, and we have the present Prime Minister fulfilling statements given during the campaign. The leader of the opposition went to Washington with the idea of arranging a treaty, but he did not and could not oomplete one. The Prime Minister went to Washington to arrange a trade treaty and he completed the arrangements. I know of no better illustration of the difference between Liberals and Conservatives in trade matters.
Sometimes you hear people say, "Just tweedledum and tweedledee," and when they utter these words they think that expresses everything, and they have proved their case. I hope the hon. member for Danforth (Mr. Harris) will read what I say. So far as this treaty is concerned, I am in hearty accord with its provisions. I realize that this is the first break that has been made in the crust of economic nationalism under which this and other countries of the world have been during the last five or six years. I realize that this is the first time an attempt has been made to show the world that a break can be made in this crust and I am proud that the Liberal party of Canada, through its Prime Minister, was able to make this break.
I listened to and read carefully the speeches of both the Prime Minister and the leader of the opposition and I found it extremely puzzling to discover the objections of the leader of the opposition to the terms of the treaty. I have endeavoured to put those objections under different headings and I believe I am fair in making this presentation. In the first- instance, he took about fifteen columns of Hansard to give a resume of the history of the Conservative Dartv with regard to tariff matters. I am bound to say that the Prime Minister also took a large number

Canada-U. S. Trade Agreement
of columns to outline the history of the Liberal party on the same matter. I do not quarrel with this because I believe the historian of the future will be anxious to know contemporary thought and both these speeches will be of value in days to come.
The leader of the apposition could hardly object to the time factor in the agreement. Such an objection had gone by the boards as a fixed time had been inserted in other agreements. He did say that in 1911 he objected to the reciprocity treaty because there was no fixed time limit, because either party could cancel the agreement almost at their own sweet will. As far as this treaty was concerned, he was bound by his own actions because he had signed treaties containing a time limit. The president of the United States was empowered to sign an agreement only for a period of three years. The leader of the opposition could not say very much about this feature of the agreement.
His next objection was to that hoary old sinner that is always resurrected, the adverse trade balance. I thought that particular theory had been exploded long ago. I thought it was agreed that an adverse trade balance with one particular country did not matter. That is the enlightened opinion, but the leader of the opposition seems to be an ardent believer in the old theory. Surely there is no doubt as to the fallacy of that argument. The error occurs in the belief that the debits and credits of countries are settled in the same way as are debits and credits of individuals who may buy and sell goods in one particular country. That is not the way in which the trade of countries is carried on; debits and credits are settled largely by bills drawn upon the debtor nations.
The next objection was that Canada had given a larger number of reductions than had the United States. This objection was fully and completely dealt with by the Minister of Finance this afternoon and no word of mine can add anything to what he said. There was also the favoured nation treatment provision. There cannot be any great objection to this as we have a similar clause in most of the agreements that have been consummated by Canada. We know the effect of such a provision; we know that it opens the door to Canada in many ways. The leader of the opposition knew that his hand was bound by the former treaties which had been signed by the government of which he was the head. He could not say much about that particular feature, but nevertheless that is one of the objections he took to this treaty.
He dealt also with the question of direct shipment and the injury that might be sus-
|Mr. Glen.]
tained by the Canadian National Railways and the Canadian Pacific railway. Again this matter has been dealt with by the Minister of Finance and I need not deal with it further. In a forty minute speech it would be impossible to deal with all the objections taken, but there are one or two remarks of the leader of the opposition to which I wish to take objection. At the beginning of his speech he said that he did not suppose his hon. friends opposite would be prepared to concede to him the same degree of sincerity that they claimed for themselves. I think the right hon. gentleman is entirely in error in making a statement of that kind. I think he must admit that we of the west are sincere in the principles we advocate in this house. When the Prime Minister asked the leader of the opposition why he had not completed an agreement with the United States, he replied: Because I prefer my country to office and power. I think he will agree in his calmer moments that the inference to be drawn from such a statement is bound to be offensive to many of us in this section of the house. The inference is that we are here simply for office and power, and that we are prepared to do anything in order to attain that. I wish to think that was simply a remark made in the heat of debate, such as a man usually regrets later on, and as such I will regard it.
There are a number of hon. members here who by conviction and experience are free traders. When this treaty was brought before the house those of us of that type of mind were certainly in favour of it because we realized, as we have not been able to realize for some time, that the country has been given a hope of larger markets. This is one of the results of the policy of the Liberal party. We believe that is not the end of the tariff reform program of the Liberal party, and the country expects that it is not.
From the point of view of western Canada -and I say this without any desire to offend those of the east who are directly interested in industries, as distinct from farming-when we see, after the treaty has been invoked and promulgated, some of the implement industries of the east taking the position that despite the reduction of the duties they immediately increase the price of the articles they produce, we wonder just what they suppose that the country, after the election of October 14, will think of that attitude. Do those people think that the resources of statesmanship are exhaused in the mere winning of an election? Do they realize that their action has called forth condemnation throughout the whole of this dominion, and particularly in the west? When duties are reduced, an in-

Canada-U. S. Trade Agreement
crease in price does not seem logical, and I was glad to hear the hon. member for East Kootenay (Mr. Stevens) make in this connection the suggestion to the Prime Minister that some satisfaction should be given to the people as to why it was necessary to raise the price despite the fact that the duties had been decreased.
These parties in the east who think that industries alone have the right of control over their prices, and do not take into account the farmers of the west, who after labouring for forty or fifty years see their patrimony dissipated and disappearing daily, although the employment they give to the vast number of men engaged in agriculture is just as material to the interests of this country as is the business of the east, should realize that there must be a spirit of compromise in a country as diverse as ours and with such varied interests. Yet we find that just following the promulgation of the treaty, these prices are raised against the farmers. I say with all sincerity that I have never heard so many suggestions of division in the west as I did in the last election. The appeals that were being made and the utterances that were being given on the question of the division of this country were more pronounced than at any time I have known. When you get an instance such as we have in this case, that merely accentuates the situation. Vast numbers of people from all over the country are writing to the members complaining about the matter, and asking the reason. They demand that the Liberal government shall see to it that these manufacturers shall not impose their will upon us very long. I am therefore entirely in accord with what was said by the hon. member for East Kootenay that this is also a matter for investigation. If there is a proper answer, all right, let us have it; we want to know it, but certainly the people of Canada have a right to learn the explanation of these industries in raising their prices.
I should also like to point out, with every desire for unity between the different parts of the country, that both in the west and in the east there is the Cooperative Commonwealth Federation party who have not taken a position with regard to trade. They do not think the same way as I do in this respect. They are rather casual about trade. To them it is a matter of some importance but not of the importance that we give to it. I would point out that upon their attitude towards this agreement will depend to a large extent the success they will have in their appeal to the people. If they do not support, as I think they ought, an agreement which will tend to lighten the
burdens of the farmers throughout the west, they will certainly be faced with the response of the people that progress and prosperity are the negation of their party's hopes. I submit to the Cooperative Commonwealth Federation that in this they are dealing with realities, realities which have been reduced to concrete form. This is something which, judged in the light of history, must necessarily respond to the benefit of the common people. It is a reality reduced to concrete form. Are these representatives of the west and the east going to deny to the government of the day that support which is necesary to show not only to the United States but even further than that, across the water to the old land, that Canada is ready to trade with her neighbours, ready if necessary to give concessions freer than have ever before been given, and that we are ready to act as neighbours?
In connection with that, Mr. Speaker, there has been considerable discussion with regard to another agreement. The Prime Minister took the earliest possible moment to complete this agreement with the United States. I suggest that he is now in a position to treat with the old country. In the Ottawa agreements what I would call a savage bargain was made by Canada as against the old land. I refer particularly to section 11 of the Ottawa agreements providing for the equation of prices in costs of production as between Canada and Great Britain. I assert that it will be impossible for the parties to reach agreement on that question of prices with a view to the enlargement of trade between the two countries. An impossible barrier has been erected, a barrier which must be removed. I do not think I am asking the Prime Minister to do something in a hurry, but I do say that the Ottawa agreements, which do not expire until 1937, could very well be approached now.
My correspondence with persons in the old country and my reading of newspapers of the day lead me to the conclusion that old country people are ready, willing and anxious to meet the Prime Minister of Canada to-day and enter into agreements which will be satisfactory to both parties and not to one party alone. In the guarded statements of their statesmen after the last election here, one can read between the lines the expression of the relief they felt and the hope and expectation they have that Canada will come to them now and make a bargain that will be worth while. I am anxious to see that completed because I believe that the bonds of trade are stronger even than the bonds of blood, and that our trade with the United States, if it grows as much as we expect, may lead to a division between ourselves and the old land, which division can be avoided

Canada-XJ. S. Trade Agreement
now by a trade agreement satisfactory to both countries. I therefore suggest to the Prime Minister that it is not necessary to wait until 1937 before an approach is made. I am quite certain that the response he will receive from the old country will be such as to gladden the hearts of himself and his government and all the people of Canada. I therefore make that suggestion in all seriousness to the government. I hope it will be acted upon, and soon.
Do hon. members realize this fact also, that Britain is making treaties with other countries, and the time may come when she may say that she is not anxious to make treaties with Canada because we have shown in these Ottawa agreements that we are more concerned for our trade than we are in the kinship which it was thought existed between both countries. The day may come, and very early, when Britain may say that she is not anxious to treat on these matters; that she cannot and perhaps will not consider a trade bargain, although the Prime Minister of Canada more than any other man is in a position to make compromises in the matter of trade with the old land.
I am glad indeed to be able to say that this treaty has evoked a warm response in the- west. In fact it may have created hopes that cannot be fulfilled. The hon. member for East Kootenay said that this was not all that could be obtained; that the benefits we have secured would not rectify everything. Everyone realizes that fact, and in one of his radio addresses the Prime Minister pointed out what I think is a very evident truth, that before reform there must be recovery. I entirely agree with that statement; we must have recovery before we can have these reforms. We need not necessarily delay reforms, but our efforts will be futile unless we are able to say that we have recovered sufficiently to bring about reforms. I agree that we have within the dominion many problems which have to be solved, but the first one we have before us is this question of trade. I have gone through this agreement. I am not entirely satisfied with all its terms. I should like it to be much more comprehensive, but I am willing to accept it knowing that it marks the establishment of a principle which will do much to raise the hopes of the people in the Dominion of Canada. Therefore I will support it with my whole heart.


Hon. GROTE STIRLING (Yale):: Mr. Speaker, I have paid close attention to the speeches delivered so far during this debate, in the hope that I might be able to get a clearer vision of all the implications contained in this agreement. An agreement

between Canada and the United States is a matter of such immensity that it is by no [DOT]means easy to gather all its implications. A bargain can be made easily between two people; an agreement can be made without difficulty between two countries, provided you are ready to give enough. This agreement touches so many branches of industry and is so spread over all the nine provinces, with all their divided industries, that it is by no means easy, study though you may, to ascertain fairly the implications it contains.
I listened particularly to the long speech of the Prime Minister (Mr. Mackenzie King) when introducing the resolution. I listened to the historical part of that speech. I was more interested in the latter years, when he dealt with them, than with the earlier ones, because during eleven of those latter years I was a member of this house. The right hon. gentleman chided the late administration for not having made more progress than it did. He expressed extreme regret that he was not in power during those years, because if he had been in power there would have been manifest progress, and that in spite of the fact that in the nine years during which he was in power, there was no progress; in spite of the fact that on two occasions during those nine years the United States raised its tariff to such an extent that Canada's trade was grievously affected, and in spite of the fact that the right hon. gentleman's view as to the proper action of the Canadian government at that time was that it should do nothing which could be looked upon as being of a provocative nature.
Probably it would be more correct to point out that these negotiations would not have attained the progress they did attain had it not been for the fact that the United States realized that in this country there was a virile government whose intention it was to govern Canada for the benefit of the Canadian people, and particularly for the benefit of the Canadian worker. There is very little doubt. 1 think, that had it not been for that virile government that was in power during those five years we should not have had the empire trade agreements we now have. I think it is evident also that the United States took note of the existence of that government and of the fact that its policy was to link up the trade relations of the empire as a preliminary step towards the negotiation of trade agreements with other nations of the world. It is noticeable that it was not until June, 1934, two years after the Ottawa agreements were consummated, that for the first time in history the United States congress empowered the

Canada-U. S. Trade Agreement
president to make trade agreements, with certain restrictions on his actions. After that had been accomplished the preparatory work went on at a much faster pace and by last summer a sufficient quantity of facts and figures had been collected to make it possible for the spokesmen of the two countries, after they had digested those facts and figures, to approach each other with the idea of coming down to definite terms of negotiation.
As the right hon. leader of the opposition (Mr. Bennett) has pointed out to the house, he discovered and reported to his government that what the United States required Canada to give was, in his opinion, too great a price to pay, so it was not possible for that government to consummate an agreement. Then, not unnaturally, the matter was dropped during the period of the election campaign. Later as a result of, shall I say, an accident of electoral arithmetic, my right hon. friend opposite found himself in a position of power. He then hastened to Washington and, using the same facts and figures, came to the conclusion that it was possible for Canada to pay that price. Hence we have this agreement which we are now debating.
It will be noticed that Canada gives the United States one of three things: the intermediate tariff, the most favoured nation treatment modification of the intermediate tariff or the special schedules attached to the treaty. These apply particularly to the commodities we have to sell to the United States and those the United States have to sell to us. In the short time at my disposal I propose to deal with the effect of this treaty on the fruit and vegetable industry, which is the principle industry in the constituency of Yale. It does not appear to me that the treaty has much effect on the other industries carried on in that district. I do not think the treaty has much effect on the dairy industry as carried on there or on the mining industry, which has to do with coal and copper, gold and silver. I do not think it has much effect on the lumbering industry as carried on in those hills and valleys, for that industry is not on an export basis; it depends for its prosperity on the prosperity of the other industries in that district, principally the fruit and vegetable industry.
In considering tariff matters as they relate to fruits and vegetables I always think that there are two facts which should be kept prominently in mind. One is that these commodities are perishable; they must be sold when they are ready to go to market. That market must be in a receptive condition. If the market is not. ready for them they must be destroyed or stored, and storage is costly for it has to take care of cold and heat, and to preserve
humidity by the most perfect ventilation. And it is only for a comparatively short time that these perishable products can be stored. The other fact that must be kept in mind in discussing trade with the United States is that we are dealing with a country in which the time of maturity of these perishable products is several weeks in advance of ours, and when a certain commodity produced in Canada is ready to roll towards our markets it arrives in such markets at a time when the same variety produced in the United States has almost finished its marketing period. And United States distributors have never shown any lack of desire to get rid of their surplus products by sending them into a market other than their own country to relieve their own market of pressure, and naturally it is not a matter of concern to them what the price is in the Canadian market.
That distributors in the United States are still of that opinion we have an excellent illustration in the markets of Great Britain in recent months. Last season the apple crop in Great Britain failed; it looked as if there would be a bare market, and the United States have been shipping into the markets of Great Britain hundreds of thousands of packages of excellent apples, good in quality, beautifully packed, exactly the same quality, exactly the same pack as our boxed apples produced in British Columbia, Ontario and Quebec. The result was that prices were driven so low that our producers received barely the cost of production. But those United States apples went into Great Britain over a tariff of 4s. 6d. a hundredweight, so that with our producers receiving barely the cost of production the United States producers have been receiving forty cents a box less than that. This illustrates the fact that the United States distributor does not mind losing money on a certain portion of his crop so long as he can prevent it from disturbing his own market and driving down the price for the rest of his crop.
I want to spend a minute or two in refreshing the memories of hon. members with regard to the changes that have taken place in the Canadian tariffs on these commodities in recent years. Twenty-nine years ago a Liberal government amended the customs tariff by inserting section 6, known as the dumping clause. Unfortunately they never used it. Fourteen years ago the Liberal government of which my right hon. friend was the leader amended the Customs Act by the insertion of a clause which enabled the Minister of Customs, as he was then called, to proclaim a value for duty which would enable the dumping clause to be used. Unfortunately he never used it. In 1926 a Conservative government,

Canada-U. S. Trade Agreement
being in power for a few months, promptly proclaimed values for duty, and for two shipping seasons the producer in Canada had the reasonable opportunities of his own market, and the consumer did not sulfer. In March, 1928, however, my right hon. friend decided, owing to pressure brought to bear upon him by his free trade supporters, that the orders in council must go. They were all cancelled. With them went the values for duty; no more use was made of the dumping clause, and for two seasons the Canadian producer had the utmost difficulty in marketing his produce in the Canadian market.
In 1930 the present Minister of Finance (Mr. Dunning) brought in his famous budget, the budget which was to win the victory for the Liberal party. In introducing his budget he explained to the house that the government had considered the application of seasonal dirties, but had come to the conclusion that seasonal duties were not suitable to Canadian conditions. I have never understood why seasonal duties would not be suitable to Canadian conditions. It is not a particularly new idea; sixty-five years ago the Ontario Fruit Growers' Association advocated their use. As far as I am aware they were never tried. But in 1930 the government did not propose to adopt them because they did not consider them suitable. Again pressure was brought to bear upon the minister by the free trade section of the Liberal party, and to our surprise, after the gruelling which the schedules in that tariff received when that budget finally emerged from the committee we found that seasonal duties had been introduced into it all down the line. Then came the general election and the change of government, and one of the first actions of the new government was to proclaim once more the values for duty, and to invoke the dumping clause. For five shipping seasons the producer in Canada had the reasonable opportunities of his own market, and certainly it cannot be said that the consumer suffered.
I want now to turn to a consideration of the items in the treaty which affect the fruit and vegetable growing industry. They will be found principally in the schedule attached to the treaty. It will be noticed that, to speak in general terms, the duty on vegetables has been reduced from thirty per cent to fifteen per cent and the duty on fruit from twenty to fifteen per cent. If they are left with only that amount of protection. I am afraid that the fruit growers and the vegetable growers in Canada will find themselves in a parlous position. But as far as ten fruits and fifteen vegetables are concerned the government have taken power to apply the dumping 
clause in a modified way. They have power to declare a value for duty and added duty which shall not exceed four-fifths of the minimum amount used in the years 1933, 1934 and
1935.	To my mind the question turns on this point, that although this power is provided in the treaty, if we remember the actions of a Liberal government composed to a certain extent of the gentlemen who hold ministerial positions to-day, a doubt must exist in the mind of the producer whether the government proposes to use this method of protection. If they use it the next question would be: Do they propose to use it to the full extent of their power? If they do so use it, do they propose to use it in time? For it is obvious that if Canadian produce rolls towards the Canadian market and arriving there finds that market cluttered up with the surplus of another country, and prices consequently very low, it will be of little assistance then to impose a value for duty, for it is most improbable that in face of Canadian production that price will rise. To my mind the whole question in considering the effects of this treaty upon the industry turns on that fact.
But there are three commodities which come in for less kindly treatment than do the others. There is one fruit, strawberries, and two vegetables, celery and lettuce, which receive considerably less assistance than do other fruits and vegetables. Why they have been selected for special treatment I do not know. As hon. members are aware strawberries are produced in considerable commercial quantities in British Columbia, Ontario and parts of Quebec. Just at the time when our strawberries are ready for the market they find themselves in a market cluttered up with the surplus of United States crops, which are just clearing up, and at a time when distributers in the United States are using every endeavour to keep that large quantity off their market. They do not care what happens to the Canadian market. Even though the minister employs to the greatest extent and at the proper time the powers provided in the treaty, strawberries will receive less protection than they did under the 1930 budget, without the assistance of any dumping duty. Similarly, in the Armstrong section of the Okanagan valley celery of quality is grown, and it is put up in such a pack that it is known throughout Canada. In California, just to the south of us, they do not grow their lettuce and celery by tens of acres; they grow it by thousands of acres, and it appears to me that British Columbia and Ontario will find themselves tremendously handicapped because of lack of assistance even to the extent of that

Canada-U. S. Trade Agreement
contained in the 1930 budget, to say nothing of the help producers of those two commodities have been receiving in the last five years.
Last year Canada imported $2,500,000 worth of vegetables and $2,500,000 worth of fruits, principally from the United States, of kinds and varieties produced in Canada. In the fiscal year 1929-30 we imported a little more than $7,000,000 worth of fruits and $8,000,000 worth of vegetables. Conditions in 1929-30 were very different from conditions obtaining to-day, and it does not seem at all improbable that the amount Canada will import in coming years under the provisions of this treaty will very considerably increase. I know of no variety of fruit or vegetable produced in Canada which could not be produced to a point which would go a very long way towards supplying the needs of the Canadian consumer at the time he requires them, namely in the actual producing season.
An examination of the effects of this treaty on commodities other than those mentioned in the special schedule reveals the fact that there are two which in future will come in under the intermediate tariff. I am referring to cut flowers and potatoes. Hitherto cut flowers came in from the United States under a tariff of forty per cent and potatoes under one of seventy-five cents a hundred. In future both will come in free. On Canadian soil and under Canadian conditions there is no question that dotted across Canada flowers of excellence are being grown. There are many occasions in our lives when we wish to purchase flowers; usually we want them in a hurry and are particularly anxious to get them. It seems to me most unlikely that florists will be able to produce in anything like the same volume they have produced in the past if in the future cut flowers come in free of duty from the United States, where frequently they are grown with the assistance of cheap labour, and, if they be hothouse production, under lower fuel costs prevailing in the United States.
It is less easy to understand the situation produced by the treaty with regard to potatoes, because in connection with this commodity Canada is on an export basis. Last year she exported five times as much as she imported. Surely the government does not propose to balance the trade in potatoes. Surely it is unlikely that the United States will fail to make use of the situation described by the Prime Minister in these words:
Of the other products not covered by the trade agreement the most important are codfish and table potatoes, and in the case of both these products low prices and depressed
conditions in the industries concerned in the United States made it impossible for the government of that country to consider the granting of concessions on these products at the present time.
I do not know if that can properly be connected with what I am referring to, but it amounts to this, that the price is so low in the United States that we will now let them enter Canada free, while Canada is on an export basis. However the government, if the minister sees fit, can correct these difficulties. He has pointed out, and quite correctly, that it is quite impossible for him to reveal the secrets of the budget before its introduction. I find myself in the position of having to endeavour to judge the treaty on the facts which present themselves to me at this time. Whereas these two commodities used to come in here under a tariff they now come in free, and I do not see how the producers can be other than troubled and anxious with regard to possible results.
For a few moments I should like to look at the other side of the treaty, and see what Canada receives. I find that in the future apples may enter the United States under a duty of fifteen cents a bushel rather than one of twenty-five cents. I wonder if hon. members know that forty-one states of the union produce apples on a commercial scale. I wonder if they have considered whether in view of that fact it is probable that Canada will be able greatly to increase the $10,000 worth of apples she sent to the United States last year. It does not seem to me that a country which grows apples to the enormous extent they are grown in the United States, and which has a proclivity for dumping its produce on our markets, will be very receptive to an increase in the supply of apples from Canada.
The duty on strawberries is reduced from one and one-quarter cents per pound to three-quarters of a cent per pound. Last year we exported $19,000 worth to the United States. I have already pointed out that when our strawberries are ready to move to the market they come up against the tail end of the United States strawberry season. Is it likely, then, that we shall find a receptive market in the United States for our strawberries? The duty on cherries is cut in half. We exported so small a quantity last year and in recent preceding years that they are not even mentioned separately, but come in under the heading of other fruits, n.o.p.
The duty on peas is cut in half for three months. There, again, the amount which we have shipped is negligible. Then we come back to potatoes. The duty on potatoes has

Canada-ZJ. S. Trade Agreement
been reduced for certain months and a quota established. They want to buy our seed grain from this northern climate, but as we are on an export basis already, as they are allowed to ship their potatoes into Canada free, as our producers of early potatoes have more than enough to supply the Canadian market, it is very questionable to my mind whether we shall benefit greatly from that item.
The tariff on turnips is cut in half, and I think that will help. Two areas in Canada produce turnips on a commercial basis, and we shipped into the United States last year $396,000 worth. It may be that other areas in Canada will be able to turn to the production of turnips and that this reduction in the tariff will assist us.
The tariff on cabbage is reduced from two to 1J cents. The quantity we shipped last year was negligible, but the quantity which the United States shipped to us last year was $161,000 worth, and four years ago it amounted to $450,000 worth. I do not think it is very probable that we shall get much assistance on cabbage.
So here we have seven items in the fruit and vegetable schedules on which we do get tariff assistance of a sort from the United States, but the whole of the rest of the fruits and vegetables which we produce will remain under the Hawley-Smoot tariff. In endeavouring to come to a fair decision with regard to the implications of this treaty regarding advantages to this particular industry, I am bound to say that I cannot find any. But the whole matter, let me emphasize, turns on the willingness or otherwise of the Minister of Finance to make use of the powers under his hand, and I would remind him once more that although the amount he can use is less than it was-I must also refer to the fact that it is a method of protection against which he set his face in an adamant way in 1930-the harm which this treaty may do to the fruit and vegetable industry will be considerably lessened if he will use that power to the full, and if he will use it in time.


Mr. A. H. MITCHELL (Medicine Hat):: Mr. Speaker, before this debate adjourns and the house goes into committee I should like to say that it has been a source of satisfaction to me to have occupied a grandstand seat in the House of Commons while the two old stalwart political parties have been riding the hobby-horse of high versus low tariffs around the racecourse on its perennial run which it has been following now since 1867. It has been quite enlightening to watch it.

I should like to refer to a remark that was made by the hon. member for Moose Jaw (Mr. Ross) last night when he said, "My hon. friends in the far comer who say that the people of western Canada are not interested in trade are lucky that they do not have to go back to the country very soon." I wish to correct any misunderstanding that hon. members may 'have in thinking that we in this comer are not interested in trade. I do not wish those words to be put into our mouths at all. We, in western Canada are very greatly interested in trade, and we here in this corner representing Alberta are vitally interested in trade. We feel, however, that our interest is more in internal trade than in external trade at this time. We do not believe with the right hon. the Prime Minister (Mr. Mackenzie King) that external trade is going to solve the problem which now confronts Canada and do away with our unemployment problem and our relief camps and the various other troubles that confront us. We have no real hope that this trade treaty which is now being completed with the United States will bring back any very great measure of prosperity.
We have no really fundamental fault to find with the treaty, and I myself am going to vote for the passage of this resolution now being debated, but I am doing so not with any pious prayer that this new agreement, which might have been efficacious many years ago in the history of Canada, is going to be the one panacea we have needed these last five years to put our unemployed to work and that sort of thing. Our interest is in trade, in free trade, in lots of trade, but we might well have spent the time we have taken on this debate, and perhaps more,, and I hope we shall before parliament prorogues, in devising ways and means whereby trade ihside Canada might be stimulated so that our own citizens might be provided with the means for consuming to the full. Then, after that, we might make agreements with foreign countries for the disposal of our surplus. I hope, Mr. Speaker, that we shall spend just as much time on this new horse, which is not a wooden one like the hobby-horse of high versus low tariffs, and so, not being wooden, is likely eventually to arrive somewhere.
I have a. particular interest in the last paragraph of the communication which passed between the Canadian legation in Washington and the Hon. Cordell Hull, Secretary of State of the United States, and signed by

Supply-National Revenue
H. H. Wrong. Charge d'Affaires. The last paragraph reads as follows:
I am further directed to state that the Canadian government propose to invite parliament to permit the entry free of duty and charges of incidental purchases by residents of Canada returning from the United States of America, not exceeding the value of one hundred dollars, under regulations, particularly as to the frequency of such entry and duration of visits, to be prescribed, for such time as treatment substantially equivalent to that now in effect is accorded by the government of the United States of America to incidental purchases by residents of that country returning from Canada.
People meet in tourist camps; travellers meet on the trains and in many instances the conversation turns to the great difference in the treatment regarding the entry of purchases accorded to American and Canadian tourists. Sometimes the American tourists feel a certain superiority which we do not like. My constituency of Medicine Hat touches on the international boundary. Many of my constituents live long distances from the stores and populated centres in Canada and they find it more convenient to cross the boundary to the towns of Montana. On their behalf I feel very grateful that it will be possible for them to avoid the temptations which are always in the way of such people to smuggle ordinary articles into Canada. I am glad to know that travellers and tourists going into the United States will be able to bring back those little articles which they feel they want and which they [DOT] feel can be bought more advantageously in that country. They will not then be tempted to smuggle these articles into Canada. As a guide to what I expect from this government, I will read a paragraph from the United States Tariff Act of 1930. This is paragraph 1798 of the act, and it reads:
Residents of the United States returning from abroad' are allowed $100 in value on articles acquired by them for personal and household use or as souvenirs or curios. These articles can be brought in free of duty provided they are not bought on commission or intended for sale; provided, that a resident of the United States shall not take advantage of the exemption herein granted within a neriod of thirty days from the last exemption claimed.
The last paragraph of Mr. Wrong's letter reads in part as follows:
-for such time as treatment substantially equivalent to that now in effect is accorded by the government of the United States of America to incidental purchases by residents of that country returning from Canada.
There is no definition there of a tourist or there is no stipulation as to how long one must remain in a foreign country before he is allowed this privilege. The real teeth in
the United States act are that a returning resident must not use the privilege more than once every thirty days, and that the goods must not be bought on commission or intended for sale. It is my hope that the Canadian regulation will be similar to the American one and not specify a certain period which a tourist must remain in a country before he can take advantage of this exemption. Newspaper articles have appeared from time to time indicating that this period will be all the way from three weeks to three months. I hope the regulations will not be so couched that they will remove entirely the benefit of that particular clause.
On motion of Mr. Leader the debate was adjourned.

The house in committee of supply, Mr, Sanderson in the chair.



DEPARTMENT OF NATIONAL REVENUE

[Stage Direction]
Salaries, $946,240; contingencies, $75,000.
Richard Bedford Bennett: Will the minister give the committee particulars of the increases in this item?


Hon. J. L. ILSLEY (Minister of National Revenue):: The increase of $74,910 in salaries is due to statutory increases and the transfer of about forty-five clerks from the temporary to the permanent staff and the establishment of ten additional positions of a minor character. The decrease in the contingencies of $22,700 is accounted for by the transfer of the forty-five officials mentioned already. The amount involved in this change is approximately $45,000, but from this amount must be subtracted an increase of $15,300 in the appropriation for printing and stationery to provide for tabulating equipment in the statistical branch, and an increase of $7,000 in sundry expenditures to provide for travelling expenses of officers of the headquarters staff.


Richard Bedford Bennett: Before this administration came into office consideration was given to coordinating the preparation of statistical information, and the mention of the tabulating equipment brings this fact to my mind. Could the minister advise us if anything has been done in this direction? The minister knows, perhaps better than I, that at the end of each month his department endeavours to get out with great rapidity information in connection with the trade during the month. A certain amount of tabulation also takes place in the statistical branch of the Depart-
Supply-National Revenue

ment of Trade and Commerce. An. effort was being made to see whether something could not be done to coordinate this and prevent duplication of effort and expenditures


James Lorimer Ilsley: We are working on that all the time. The method of tabulation now employed in the Department of National Revenue has been worked out with Doctor Coats of the bureau of statistics. That is about all the information I think I can give.


Mr. HEAPS:: I should like to draw a little incident to the attention of the committee and the minister. Although it is not very important, it may be symptomatic of many incidents which take place on our border line affecting people who return from the United States. A week ago yesterday I was crossing the border from Ogdensburg to Prescott and I was asked at the boundary if I had anything to declare. It so happened that I had in my possession a small box of cigars which had been given me and wliich I declared to the customs official there; it contained twenty-three cigars. I do not smoke, but I brought them back-at least I thought I was going to bring them back-for some friends in the house who do smoke. I told the customs official that I had there a box of cigars valued at, I think, exactly SI.10. He figured out what the duty would be and said it would be exactly $2.40 for cigars which cost retail SI.10. I told him he had better keep the cigars there and we would see what could be done about a duty of eleven cents on a cigar which cost a nickel retail on the other side. I asked for a receipt, which was given me. What I was wondering was: What is the disposition of goods that are impounded or retained by customs officials? I was told that these cigars would go up in smoke, but whether they were burnt or not I cannot say. I was told, however, by officials of the department that goods which are detained or seized by customs officials are destroyed by them at certain stated periods.


An hon. MEMBER:: Destroyed by smoking.


Abraham Albert Heaps: It seems to me that if such is the case it is a most absurd regulation that anything which is seized or is left behind with customs officials should be destroyed, when there are many places where real use could be made of those articles. For instance, in the case of whiskey or cigars which happen to be seized by customs officials, it would strain my imagination a good deal to believe that all those goods are destroyed. I can hardly imagine that our officials are so honourable and generous that they can allow them-

selves to see good smokes and good whiskey going to waste in that way. I hardly think they would take the whiskey and pour it into the river St. Lawrence, nor do I think they would dispose of cigars in that way. But I do think, Mr. Chairman, that as regards goods seized or left at customs houses there should be some definite means of knowing what is done by way of disposing of them. In the case of such articles as I have just mentioned I see no reason in the world why, for instance, the tobacco could not go to some old folks home in the neighbourhood, and the liquor to the hospitals. I think it is ridiculous to waste material of which good use could be made. I have mentioned this matter privately to the minister. I should like him to inform the committee, if he can, how much goods have really been destroyed over a period of time and the character of the goods that have been so wasted.


James Lorimer Ilsley: I think it will be possible to get the information for my hon. friend. The regulations are very strict as to the destruction of that class of goods, they are destroyed periodically when the inspectors visit the customs houses in question. I do not think, from information I have had since being in the department, that the suspicions of my hon. friend are justified, because nothing is more strict than the insistence upon the destruction of goods that are seized under such circumstances as he has mentioned.


Abraham Albert Heaps: But is there any reason in the world why these goods should be destroyed at all?


James Lorimer Ilsley: I have not given consideration to the policy underlying the provisions of the act, but that is the law. I suppose, if it were mot, abuses would creep in. One would have to be very careful about the destination of seized goods.


Abraham Albert Heaps: Is it the law or is it a regulation under the law that these goods have to be destroyed?


James Lorimer Ilsley: It is the law.


Abraham Albert Heaps: Does the minister not think that, in cases such as those to which I have just referred, the law might very well be altered and that we should stop the wasteful destruction of goods which might be serviceable to people in this country who need them?


James Lorimer Ilsley: I shall be very glad to give consideration to my hon. friend's suggestion. It would, however, require amendments to both the Customs Act and the Excise Act.


An hon. MEMBER:: Let us have them.

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Mr. LAWSON:: On page 90 details are given of increases in several of the salaries. I assume these are the details of the item under discussion. I notice that the salary of the assistant commissioner of excise is increased by $300; that of the dominion customs appraiser is also increased. Are those statutory increases under the Civil Service Act or are they matters within the discretion of the minister under the National Revenue Act?


James Lorimer Ilsley: Both are statutory increases.


James Earl Lawson: Does that apply to the whole list set out on pages 90 and 91?


James Lorimer Ilsley: In the main, yes.


Richard Bedford Bennett: I want to ask the minister one question and see if I caught his answer correctly. There is an increase of fifty-five persons in the service of the department, from 474 to 529. In reality, I gathered from what the minister said, there was a very slight increase, forty-five being already there, who show now where they were not shown before.


James Lorimer Ilsley: That is correct. The forty-five were taken from the temporary classification and put in the permanent classification.


Richard Bedford Bennett: When was that?


James Lorimer Ilsley: A few months ago.


Richard Bedford Bennett: Before or since this government came in?


James Lorimer Ilsley: Before the change of government.


Richard Bedford Bennett: That is what I thought.


Abraham Albert Heaps: I notice an item, examiner of publications and director of publicity, $4,200. Can the minister explain to the committee the duties and functions of the gentleman who occupies that position?


James Lorimer Ilsley: That official is charged with the administration of the tariff item which prohibits the entry of certain literature, which is seditious, immoral and so forth. That is one of his duties. He has others as well.


Abraham Albert Heaps: That was the item of which I was thinking. I observe that the gentleman in question has vested in him very wide powers, and of a kind which I do not think he ought to have. Under his jurisdiction, his guidance, literature which ought to come into this country is often banned. Literature that we can find in practically all our public libraries is not allowed into Canada. I do not know what special qualifications the official in question has for saying what literature should and what literature should not come into this country. But I do think matters of this kind,
concerning what is fit for people to read, or what publications should be allowed entry into Canada, should not come under the Department of National Revenue at all. They ought to be under some department more competent, I believe, to judge of these questions than is the department which is charged with the collection of the revenues of this dominion.
I have had a little experience with this department in the past in reference to the banning of books. I remember that I went to a former minister of this department and asked if he thought certain books ought to be banned. He told me that he did not think so, but in the meantime the official of the department had banned those books which the minister thought ought to be allowed free entry into this country. I want to know what authority is given this gentleman in question; how he judges what books are to be banned and how he comes to exercise the authority and jurisdiction which he does exercise.


James Lorimer Ilsley: Someone has to do it, Mr. Chairman. Really it is the minister who bans the books, but of course the minister cannot read all the books, so we have to get the most competent official possible to examine this literature. With regard to the qualifications of Mr. Roe, I may say that he is a journalist of many years standing and a former member of the press gallery, with a long record of public service. I have no reason to think his qualifications are not of the highest character. I should like to ask the hon. gentleman if he has in mind any particular books that were banned which in his opinion should have been admitted.


Abraham Albert Heaps: I was referring to ordinary
books of a socialistic character that, to my own knowledge, have been banned, books that were published by Charles Kerr and Sons, of Chicago, that were held up by the department and not allowed to come into Canada.


James Lorimer Ilsley: Would the hon. gentleman
give me the name of the book or books by the author he has named, which literature he thinks should have been admitted?


Abraham Albert Heaps: The name I mentioned is
that of a publishing house in Chicago which publishes a more radical type of literature. My colleague from Vancouver East tells me that he can give an instance.


Mr. MacINNIS:: I had a letter a day or two ago with regard to a book that to my knowledge has been in circulation in British Columbia for the last twenty years. The title is Socialism, Utopian and Scientific, by Friederioh Engels. As a matter of fact it is
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an old classic that has been in circulation for the last thirty-five years. Why it should be held up now is something beyond my comprehension.


James Lorimer Ilsley: I will look into the matter.


Richard Bedford Bennett: If the minister will not
mind I should like to say that a great many complaints were received, even by myself, that we were entirely too lenient in our administration in this regard. I think the hon. member for Winnipeg North (Mr. Heaps) could be quite easily satisfied as to why this comes under the customs department. There is in our customs tariff an item which has been there for many years, forbidding the importation into our country of immoral or salacious literature, or literature that promotes revolution-I will put it in that way-or the use of force for the attainment of political ends. Someone has to determine whether a given book is immoral or salacious or whether it advocates the accomplishment of purposes in the manner I have indicated. There have been frequent complaints received to my knowledge, in fact by myself personally, with regard to books dealing with what one might call the new economic theories that advocate the accomplishment of a complete change in our social system by methods that at least the Supreme Court of Ontario have held to be improper. After that decision books that at times had come in freely were confiscated, because they constituted a violation of the provisions of the statute in the light of the decision that was given.


Abraham Albert Heaps: The book mentioned by the hon. member for Vancouver East is looked upon as a classic the world over. I assume one could find it in the public library here, though I have never tried to do so. I have no doubt it is in the parliamentary library; I believe if I sent for it I would get it. But, while it is permitted in all our public libraries, if anyone sends to the United States for a copy of the same book it will be held up and confiscated and considered to come within the classification of banned literature. I realize that there may be some force in the argument of the leader of the opposition, but there is the difficulty of allowing one individual to say what literature should be permitted to come through the customs and what should not be permitted to come through.
I think perhaps there is more involved in this than appears on the surface. It may be true that in some cases communications have come to the department urging that they should be a little stricter in their application of the ban on certain types of works, perhaps of a radical, socialistic or communistic character.

On the other hand, we might ask for a ban on all fascist or nazi literature, and so on. One cannot say one form of literature must be banned while another of similar type is allowed entry. I think the gentleman in question, under whose jurisdiction lies this very important question of saying what is fit to read and what is not fit to read, should be guided by some definite policy, and there should be uniformity so far as the actions of the department are concerned.


James Lorimer Ilsley: I would not like the hon. gentleman to go away with the idea that the department, the minister or any official has the right, by law, to determine what people may or may not read generally. All the department can do is administer a certain item of the tariff. That is item 1201 of schedule C of the tariff:
Prohibited goods:	Books, printed paper,
drawings, paintings, prints, photographs or representations of any kind of a treasonable or seditious, or of an immoral or indecent character.
Necessarily there must be some discretion in deciding what is of a treasonable or seditious or an immoral or indecent character. To tell the truth, I do not know how the difficulty can be overcome. I will look into the question of the book mentioned by my hon. friend. I do not know its status, at the moment; that is, whether or not it has been banned.


Mr. MacNEIL:: I should like to direct attention to a procedure which causes some inconvenience and hardship to booksellers. I refer to that class of literature which cannot be regarded as treasonable or seditious, and which has been in more or less general circulation in Great Britain and the United States. In the past the practice has been to hold up these books at ports of entry in British Columbia and other provinces and send them to Ottawa for examination. If it is. found ultimately that they are not on the banned list, they are allowed to enter. Possibly in some cases some over-zealous officials have held up books in this way. I should like to suggest that some procedure be found which will do away with this hardship to the booksellers and avoid this inconvenience to those who have ordered books and who believe they are entitled to receive them. May I ask as to the policy in that regard?


James Lorimer Ilsley: There are very few complaints of any hardship resulting from this practice. If the hon. gentleman would suggest any other procedure which might be followed I should certainly be glad to give the matter consideration, I presume there are occasions

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when the collector does not feel himself qualified to decide whether the book is of a character to bring it under the item, and so he forwards it to the department for examination.


Richard Bedford Bennett: And to secure uniformity.


James Lorimer Ilsley: Yes.


Mr. WOODSWORTH:: I have had from time to time a number of complaints about the holding up of certain papers and books which I find on inquiry are not banned. Only a few days ago I had an inquiry from a prominent citizen of Alberta with regard to the Moscow News, which is not a propagandist organ, strictly speaking, but is a news organ printed in English. I remember some years ago on returning from two or three weeks in Russia I subscribed to that paper just to know what was going on. I subscribed for it in London, England, at a regular bookshop. My copy came through regularly. After the year expired I did not renew my subscription. But now I have a number of protests from different parts of the country, people saying that although they had subscribed through the London office they had difficulty in getting their paper. Only a few days ago I had a similar protest from Alberta about the paper not coming through. I understand it is not on the banned list. Why it should be held- up at some local post office or by some customs official in the west, I cannot imagine. Can the minister give us some idea as to the mode of procedure in the matter?


James Lorimer Ilsley: I think perhaps some collector might detain the Moscow News, not knowing, and wishing to ascertain, whether it is properly admissible. I believe, however, that such occurrences as the hon. member mentions are very rare; very little complaint has been made to the department of anything of that character.


Abraham Albert Heaps: I said it was quite possible that that book which was banned might be found in the parliamentary library. I have just sent a page for the -book called Socialism, Utopian and Scientific, and from the parliamentary library comes this book that has been banned by the minister's officials. It has been in print since 1892. I do not have to comment on this matter any further; it shows the absurdity of some of the regulations put into effect by the individual in question. In spite of whatever qualifications he may have I think he must be governed by certain considerations that prompt him to ban books which can be found in practically every library in Canada, public, university, and private.


James Lorimer Ilsley: I must find out whether that particular book is banned or not. I should be very much surprised to find that it is.


Mr. TAYLOR (Nanaimo):: A rather serious instance occurred recently in Toronto. A man named John Stimak was fined $100 for having in his possession some Lenin books. On questioning Mr. Roe, the official referred to, he made the statement to me and my colleague on the right (Mr. MacNeil-) that he endeavoured always to permit such books to come into Canada if they were philosophic in character and not definitely propagandist, but that his action did not affect the Stimak case; that once the book is in the country it remains for the various provinces to decide whether they shall permit it to be handled by their citizens. That seems a very ridiculous state of affairs. If the book is permitted to enter Canada it should be permitted to enter every province, and if a man in good faith is importing books that are permitted by the dominion customs to enter, then there should be no penalty for being in possession of those books in any province of the dominion.
This also should be said, that when a minister is considering the banning of books that advocates the use of force to change the social system he should also bear in mind the banning of books that advocate force to maintain the social system, and there are plenty of such books in circulation at the present time.


James Earl Lawson: The seventh item on page 90 provides for an assistant private secretary, apparently the creation of a new position. Is that an assistant private secretary to the minister?


James Lorimer Ilsley: Yes.


James Earl Lawson: Further down there is another item:	secretaries to executive.
Apparently last year one executive had a secretary, and for the following year two are to have them. To which executive of the department is a secretary -being provided that was not being previously provided?


James Lorimer Ilsley: One of these positions was previously in existence and is in the office of the commissioner of excise. The other one is not filled. It provides for a position in the minister's office, and there is no present intention of filling it.


James Earl Lawson: Then why include it in the estimates?


James Lorimer Ilsley: Well, it makes provision.


James Earl Lawson: But if it is not necessary and there is no intention to fill it, why provide



Supply-National Revenue
money for it? Judging by the minister s answer it is not a provision for a secretary for some executive in the department; apparently it is a provision for a secretary in the minister's office in addition to the private secretary who has always been there, and an assistant private secretary, which position is also provided for by these estimates.


James Lorimer Ilsley: That is correct. The
provision is made to give some little latitude in the organization of the minister's office. There is no secretary to an executive there other than the assistant private secretary, and there is no present intention of putting one there. But this gives a little latitude in case it should be necessary.


James Earl Lawson: In other words provision is being made in these estimates for an assistant private secretary to the minister, an official he did not previously have, and for another secretary to the minister under the title of secretary to executive. Surely that cannot be so.


James Lorimer Ilsley: I am informed that there was an assistant private secretary before.


James Earl Lawson: For a time, yes.


Mr. McLEAN (Melfort):: Then why
complain now?


James Earl Lawson: I am not complaining; I am asking for information. I have not made the slightest complaint, but when I see in the estimates an item which provides for a secretary to an executive, and the minister intimates that it is to be another secretary to the minister, obviously I think there must be something unusual in the situation, and I am trying to find out what it is. I supposed the executives in the national revenue department would be the commissioner of customs for example, the commissioner of excise, the commissioner of income tax. All I want to have clear is: Does this provision for an additional secretary as secretary to executive mean an additional secretary or assistant secretary to the minister?


James Lorimer Ilsley: There is and has been for many years provision for a secretary to the executive in nearly every minister's office.


James Earl Lawson: For one, yes, and there has been one in the office of the Minister of National Revenue. But the minister is now providing for two.


James Lorimer Ilsley: No, only one secretary to executive. It is true that provision has been made for an assistant private secretary; that has been done there too. The only point is that I do not intend to fill that position.
[Mr. Li*\vsou.l
Mr. LAWSON; I hope the minister and I are not at cross purposes. He says that there is only one, but if he will read the item in the estimates he will find there is provision for two secretaries at $2,100, and that it is carried out to $4,200.


James Lorimer Ilsley: One is not in my office.


James Earl Lawson: That is what I am trying to find out.


James Lorimer Ilsley: I thought I said that one is in the office of the commissioner of excise. The other is provided for, but as I say, I have no present intention of filling the position.


Some hon. MEMBERS:: Carried.


James Earl Lawson: Some hon. members must wish to hold up the estimates; if they do I promise the committee we could spend a long time on them. In connection with one or two items I see reductions in salaries without corresponding reductions in the number of employees. About half way down the page I find an item with reference to chemists. There were four in 1935-36 and provision is being made for the same number in these estimates, but there is a reduction of $200 in salaries to be paid. Then, further down the page the minister will find a reduction of $400 in salaries to assistant chemists, although the same number are being retained. I should like to know the reason for the reductions in the aggregate amounts paid.


James Lorimer Ilsley: The reason is that with the retirement of officials who have reached the age of sixty-five years-


James Earl Lawson: Young men come in at lower grades.


James Lorimer Ilsley: -other men come in at
lower salaries.


Abraham Albert Heaps: May I revert to the banning of certain books. Perhaps the minister would give the committee a list of publications banned by his department.


James Lorimer Ilsley: I would be reluctant to do that, because to begin with it would be advertising salacious literature.


Abraham Albert Heaps: I do not wish to do that. The minister knows what I have in mind. I am thinking particularly of works along lines I discussed a few moments ago, and I think particularly of a book by Friederich Engels entitled Socialism, Utopian and Scientific. There must be many other works of the same type which have been banned by the department. A minute ago the minister wanted to know if there was a ban on the book. It is quite possible that so far as the

Supply-Fisheries
department is concerned there may be no official ban, but I do know that in certain parts of the country books are not allowed to go through the customs department.
The hon. member for Vancouver East has in his possession a communication from an organization in Vancouver asking him to inquire about the ban on this particular book. Evidently a ban must be exercised by some of the customs officials in certain parts of the country. I do not want any advertising of salacious literature in this house or anywhere else, but it is quite another matter when departmental officials attempt to bar from proper circulation books of a philosophical nature in which are discussed questions and which any person might read to good advantage. I am suggesting that the minister might read the book by Friederich Engels; it would not do him any harm, and it might do good to some other hon. members in the committee if they were to read it. The book in question was published forty or fifty years ago, and I believe if we had a list of banned literature it might help some of us who occasionally read books of that kind.


Angus MacInnis: Despite the possible bad
effect produced by advertising books of a certain type, nevertheless I think we ought to have some indication of what books are banned. It is possible that these books are banned only to some people, and that other people may bring them in or get them. That would be an undesirable state of affairs. I have been informed that although certain literature was banned to some people, other people could get those books. When we speak about salacious literature we are talking about something altogether different. It should not be difficult to find out the books which would come under that heading. At the moment I am not prepared to say that it would be worth while to have a censor. We could not do anything for those who would be detrimentally affected by reading such books, and those who would not be affected would not be reading them. There is no reason in the world, however, why we should not have a list of books such as I have indicated, and we should know why they are or are not admitted into the country.


Charles Grant MacNeil: Would the minister accept a suggestion whereby the department would be approached by publishing houses and booksellers, listing with the department books of a philosophical nature read generally throughout the world? After they have been scrutinized by the department orders could be issued to the officers at the different ports of entry advising them that there would be no reason for banning such literature. I believe
12739-48i
such an arrangement would eliminate a good deal of discontent and considerable inconvenience now being caused booksellers and customers.


James Lorimer Ilsley: That is substantially what
is being done now.


Mr. BARBER:: I see an expenditure indicated for the salary of an expert tea tester. Is that an all year round job? I notice the salary is reduced by about $500.


James Lorimer Ilsley: It is an all year round job, beginning at the lower range. That is the reason for the reduction.


[Stage Direction]
Item agreed to.

[Stage Direction]
Fisheries-Salaries and contingencies, $133,331.
Richard Bedford Bennett: Is the salary of Mr. Larabee in this item?


Hon. J. E. MICHAUD (Minister of Fisheries) :: Not in this item. He is a temporary employee.


Mr. NEILL:: There are a number of items I should like to discuss, but the list is so comprehensive that it is difficult to know which one to speak about. Speaking generally about the salary estimates I should like to suggest to the minister, who of course is new in his department, that what is badly needed in the department is a complete shake-up, and that applies both to officers at Ottawa, and particularly in British Columbia. In saying that I am not reflecting upon the management of the present minister or, indeed, upon that of his predecessor. The last minister was a victim, shall I say, and the present minister is liable to be embarrassed by the subtle, feather bed influence of his officials. They do not say to him: You shall not do so and so. That would possibly excite his suspicion and his resistance. But the continual dropping of water wears away the stone, and they yes, yes him, and then gently but quietly, day by day, influences are brought to bear and facts or semi-facts brought forward, and presently the minister finds himself committed to the stagnation of bureaucracy, than which there can be no more hopeless condition.
I do not suggest, when I say that there should be a shake up, that the minister should discharge the officials or attaches appointed by the late Conservative government, who have now become to a very large extent barnacles on the ship of state, and supplant them by Liberal attaches who in time would also become barnacles, but I use the word as I intend it; I mean: Shake them up. A certain section of the employees are
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more or less asleep. Another section is composed of political hacks in every sense of the word. Another section, the larger one, and the most fatal of all, the one of which I, perhaps, complain most, is composed of those who have got into the official rut, and there is nothing more hopeless to get action from than that.
I have some knowledge of that situation myself, having been a civil servant for ten years, and I saw both in my own experience and that of others how the continued officials come to resent anyone coming forward with any suggestion that might mean action or change. We got into the position where we knew that it meant trouble and worry, and possibly a reprimand from the government for taking the wrong way instead of the right way. It was so much easier to make some general evasive reply or objection, and stall off the man or woman who wanted change. I was once told by a deputy minister of an important portfolio in this government, speaking from a long experience, "Mr. Neill, I get along best when I do nothing." He was deputy minister of an important department, and there are parts of this country suffering to-day from the policy or lack of policy indicated by his attitude. He is no longer a deputy, so I am not hurting anybody's feelings.
When I say, shake them up, I mean that those who have got into a more or less sleepy condition should be advised to wake up. The political hacks to whom I have referred, who got their positions through political influence- and I have no objection to that provided they carry out their duties-do not seem to be aware that there has been a change of government, and they are still continuing to play politics. I am referring more to British Columbia than to the offices here where, in fact, I know of none of that.
The third thing is to get them out of the rut, so that when a suggestion is made by people whose livelihood is at stake they will not simply sit down and write a letter, take the line apparently of least resistance, stall the man off, give him some form letter-I have received scores of them and have a dozen in front of me now-hoping that he will forget about the matter or give it up in despair.
Coming to the estimates themselves, I see the details are given on page 77. We know, if not from personal knowledge, at least from the press, that the government has told the different departments that they must cut down and practise economy. I do not know if they have been told that they must cut down their estimates to those of a certain year, or that a certain percentage must be cut off, or a certain sum, such as $200,000 or $300,000 must be cut

off. At any rate, glancing at this book of estimates, the result is obvious. Orders have been given-and I am not complaining of this -to cut down expenses. It is the method I wish to protest against, and it is perhaps not the fault of the officials so much as of the system that has been adopted.
The minister or his deputy is told, we will say, that he has to cut down to the amount of $200,000. There are only one or two ways in which he can do this. The deputy can either cut down his staff, dismiss some of them, or cut down the seasonal work that is done in the field. Why can he not cut down the salaries of his employees? He cannot do that because that is regulated by the government in another way. If the government wish to cut down the salaries of the civil service they do so, as they have done, by a blanket reduction all round, but that is not within the scope of the deputy or the minister who is told to cut down the expenses of his department.
Then the deputy is confronted with this situation: I have to cut down $200,000; I cannot take it off salaries; what am I going to do? One thing would be to reduce the staff, but did one ever hear of a deputy doing that? What is the whole idea of a man when he gets into public office but to build a bureau around himself. Give a man the job of shovelling snow between the east and the west block, and then go away and come back in ten years, and you would not find him shovelling snow any more; he would be the deputy superintendent general of snow shovelling, with an office of his own and a deputy and assistant deputy, an accountant, and probably a purchasing agent, and we would be mighty lucky if he did not have a publicity agent as well. The deputy cannot get away from the temptation of building a staff around himself, and the superintendent general of snow shovelling would, of course, get a bigger salary than the man handling the shovel. Very well then. The deputy is not going to cut down his staff for that reason; then there is also the pressure of friends, and all his subordinates have friends and relations who will put pressure upon him.
Then what is he going to do? He will do as we see revealed in the estimates. He will cut down on the practical work. Instead of cutting down these salaries I note that there is an increase of $4,893, practically $5,000 of an increase, mark you, in salaries. Then if you will look at page 44 you will find that substantial reductions are being made in the work that is carried on. There is a total reduction of $185,112 in the various items, and where did the bulk of that reduction come

Supply-Fisheries
from? The biggest item of salaries and disbursements of fishery officers and guardians, fisheries patrol, and fisheries protection services. a very essential service in connection with the conservation of fish, is being cut down by $141,548 out of a total reduction of $185,112, while the overhead, the permanent salaries, has been increased by nearly $5,000. There are other items, some of which are being reduced thirteen per cent, some seventy-six per cent-that is one of the most important items that I shall deal with presently if I have time-another one, thirty-four per cent, and so on, while the overhead has been increased four per cent.
Partly it is the system that is wrong, and partly this is due to human nature; they do not like to go at it in the right way. It is inimical to the best interests of any industry, when economy and curtailment must be practised, that it should be practised on the practical work in the field rather than on the overhead. It might be said that the men working in the fields are also getting salaries, but they are cut out because they are seasonal men. The order goes out that instead of 150 guardians there shall be only eighty. Do hon. members realize the damage done by such a reduction? Streams that have been protected for fifteen years are left without guardians, and when a stream is left without guardians it means that poaching occurs, human nature being what it is. In British Columbia these conditions are particularly bad. There is an over-staffed office in Vancouver, but there is no suggestion of cutting down there. The really practical work in the field is to be curtailed.
Turning to the head office, I find that one man who is drawing a very substantial salary died but his position was filled at once. I believe his work could have been done by others in the department and there would have been an opportunity for some retrenchment. Instead of this, I notice that the staff at Ottawa has been increased from sixty to sixty-one. Then I notice a fisheries engineer, but that is all right. Then I notice a purchasing agent. How many things must be purchased for the department? Could not the services of the purchasing agent of the Department of Marine 'be obtained for the purchase of the things required for this department? Is it necessary that every little department should have a purchasing agent?
I notice that the last auditor general's report gives the salary of this man as $2,862, but he is now slated at $3,420.
Then we find what I think is the gem of the whole collection, a director of publicity.
What does the Department of Fisheries need with a director of publicity? What does he do? Before this item passes I intend to ask for full information on that. Then when I get it, I am going to ask what his assistant does. I have no doubt that if I looked further into this matter I would find that the assistant had an assistant, probably under the designation of clerk or something of that kind. Then we find a director of fisheries promotion and inspection. This gentleman receives a very substantial salary. Possibly he does useful work, but when the general services of this department are being reduced by $185,112, as will be found on page 44, I cannot understand why there should be an increase of $4,893 in the salaries of the permanent staff at Ottawa.
It is not possible to get full details for British Columbia as the auditor general's report is about two years old when it is issued, but I am sure the same conditions prevail there, i.f they are not worse. I believe they have a director of publicity, but he goes under a different name, something to do with statistics. I should like the minister to give me some explanation about these matters. First, what are the duties of the director of publicity and his assistant?


Joseph Enoil Michaud: In reply to the hon. gentleman's direct question I may say that the director of publicity and his assistant collect statistics and distribute them throughout the country and the world in an effort to increase the demand for fish. The fisheries industry of Canada is worth about $34,000,000, the fisheries of the Pacific coast alone are estimated to be worth $20,000,000.


Mr. PELLETIER:: On page 77 I notice the salary for the private secretary shows an increase of $1,532.59. Why is that?


Joseph Enoil Michaud: Last year there was not a private secretary engaged for the whole year. The estimates for next year provide for one being engaged for the full year.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Wednesday, March 4, 1936