1937-04-08

Mr. J. F. JOHNSTON (Lake Centre):: Mr. Speaker, I desire to present the second report of the special committee on farm implement prices, together with a copy of the evidence taken before the committee and before the standing committee on agriculture and colonization in 1936, and the exhibits filed. In this connection may I be permitted to give notice that on Saturday, April 10, I will move that the recond report of the special committee on farm implement prices be concurred in.



SUPPLEMENTARY ESTIMATES, 1937-38

[Stage Direction]
A message from His Excellency the Governor General transmitting supplementary estimates for the financial year ending March 31, 1938, was presented by Hon. Charles A. Dunning (Minister of Finance), read by Mr. Speaker to the house and referred to the committee of supply.

[Stage Direction]
On order for introduction of bills:-
Mr. JEAN-FRANCOIS POULIOT (Temis-couata): With reference to the order standing in my name for introduction of a bill to amend the Militia Pension Act, may I ask the Minister of National Defence (Mr. Mackenzie) if his department is studying now the matter of seconding in order to bring in some legislation in that regard next session?
Mr. MACKENZIE (Vancouver):: The subject referred to by the hon. member has been under consideration for some time by the department.


Mr. POULIOT:: The bill will be dropped.
Questions



QUESTIONS

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

Mr. BROOKS:: 1.	Have contracts been granted for placing buoys and stakes to mark channel of Saint John river and Grand lake, New Brunswick?
2.	If so, who received the contract, and what was the amount of the tender?
3.	Is there a date set for the placing of the buoys and stakes?


Mr. HOWE:: 1.	A contract has been awarded.
2.	William McFadzen, lowest tenderer, $650.
3.	There is no set date. Contract requires that buoys and stakes be placed upon opening of navigation each year.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. LAPOINTE (Matapedia-Matane):: 1.	How many boats of every class will the federal government operate in the St. Lawrence waters during the next season of navigation?
2.	What are their names?


Mr. RINFRET:: Return tabled herewith.


FEDERAL PAYMENTS TO NOVA SCOTIA FIRMS
Mr. PURDY:: 1.	What sums were paid to the following, from 1930 to 1936 inclusive, by the dominion government: (a) Nova Scotia Textiles Limited; (b) J. E. Mortimer; (c) Wilcox Brothers, all of Windsor, Nova Scotia, and (d) C. B. Smith, barrister, Halifax, Nova Scotia?
2.	For what services in each ease were these sums paid?


CIVIL SERVICE RETURNED SOLDIER PREFERENCE
Mr. POULIOT:: 1.	Does the preference extended by the Civil
Service Act, section 29, to "all other persons who have been on active service overseas on the military forces or who have served on the high seas in a seagoing ship of war in the naval forces ... of any of the allies of His Majesty, during the war," apply to those who have served, during the war, in the armies or navies: (a) of all the powers being described in the treaty of Versailles as the principal allied and associated powers, viz: the United States of America, the British Empire, France, Italy and Japan; (b) of all the powers constituting with the principal powers mentioned above the allied and associated powers, viz:	Belgium,
Bolivia, Brazil, China, Cuba, Ecuador, Greece, Guatemala, Haiti, The Hedjaz, Honduras, Liberia, Nicaragua, Panama, Peru, Poland, Portugal, Roumania, The Serb-Croat-Slovene State, Siam, Czecho-Slovakia, and Uruguay?
2.	If not, what powers?

3.	Was and is not preference also extended to those who have served, during the war, in the army and navy of Russia before the revolution?
4.	If not, why?
5.	What are: (a) the regulations; (b) the rulings, and (c) the practice of the civil service commission with regard to the preference mentioned in paragraphs 1, 2, and 3?
6.	Do the persons mentioned in paragraphs 1, 2, and 3, enjoy the same preference in the civil service of Canada as the members of the Canadian expeditionary force?
7.	Does the civil service commission keep any record of preferential appointments referred to in the first three paragraphs?
8.	If so, what is it?
9.	If not, why?


ROYAL COMMISSIONS-PERSONNEL AND COST
Mr. TOLMIE:: 1.	Have the following commissions completed their investigations: (a) royal commission on the textile industry; (b) royal grain inquiry commission; (c) royal commission on anthracite coal?
2.	How many months or days has each commission been at work?
3.	When will final reports covering (a) and (b) be presented to the house?
4.	What is the total cost of each commission to date?
5.	What amounts (in detail) have been paid to chairman, commissioners, lawyers and witnesses, and court expenses to date on all three commissions?


Louis Édouard Fernand Rinfret: Return tabled herewith.


COLONEL J. L. REGAN
Mr. BROOKS:: 1.	Was Colonel J. L. Regan employed by any department of the federal government during the past year?
2.	If so, in what capacity, and what amount of money did he receive for his services?



NATIONAL RESEARCH COUNCIL-PERSONNEL

Jean-François Pouliot: _ 1. Referring to the statement of the Acting Minister of Trade and Commerce at pages 2279 and 2280 of Hansard of March 24, 1937, was the late Mr. Dalglish, formerly employed at the National Research Council and a brother of Chas. Dalglish, clerk at the shop stores of the said council at $1,440 per annum, related or connected to Mrs. G. M. Sharpe, secretary to the president of the said council at $1,620 per annum.
2.	If so, what is that relation or connection?
3.	When was the said Mrs. G. M. Sharpe appointed secretary to the president of such council?
4.	What is her age?
5.	Is she a widow?
6.	If not, what is the full name and address of her husband?
7.	Does he hold a position?
8.	If so, where?
9.	Referring to the above statement, is C. Sharpe, her son, employed at such council at $720 per annum during the last fiscal year,

Business of the Home
also the son of the man referred to in paragraph 6, or is he issued from a previous or ulterior marriage?
10.	What is the full name of the said C. Sharpe's father?
11.	Are Mrs. Sharpe's initials "G.M." her own or those of her husband, and, in the first case, why does she use them?
12.	Is the said Mrs. G. M. Sharpe a sister of Mrs. G. A. Hoare, 439 Island Park, Driveway, or any other address in Ottawa?
13.	If so, did she and does she hold a position in the civil service under that name or her maiden name, Miss Logan?
14.	If so, what is it, where is it and what is her salary?
15.	Is G. A. Hoare, husband of the said Mrs. G. A. Hoare, a brother-in-law of the said Mrs. Sharpe?
16.	If so, did he or does he hold a position in the Department of Mines and Resources, or any other department?
17.	If so, what is it, where is it, and what is his salary?
18.	What is the total of the salaries paid during the last fiscal year to the said Charles Dalglish, Mrs. G. M. Sharpe, C. Sharpe, G. A. Hoare, and Mrs. G. A. Hoare or Miss Logan?
19.	Was or is a Mrs. Logan, who lived or who lives at 439 Island Park, Driveway, employed at the char service in any department and where?
20.	If so, was or is she related or connected
to the said late Dalglish referred to in paragraphs 1 and 2, and to the said Mrs. G. M. Sharpe, C. Sharpe, G. A. Hoare, and Mrs. G. A. Hoare or Miss Logan?	,
21.	If so, what is the relation or connection in each case?
22.	What salary was paid to the said Mrs. Logan during the last fiscal year, and where did she live during that period?



DOCTORS IN PUBLIC SERVICE


Mr. POULIOT:: 1.	How many doctors are there: (a) in the pensions branch of the Department of Pensions and National Health; (b) in the national health branch of the said department?
2.	How many medical doctors are there in each branch?
3.	Are there any doctors at the National Research Council?
4.	If so, what are their names, degrees (with the names of the university from which they were issued), dates of appointment, professions, duties or functions, and salaries?
5.	Are there members of the personnel of such council who are not doctors?
6.	If so: (a) how many and (b) how many of them have passed civil service examinations for the particular position that they hold now at such council?
7.	Same question for doctors referred to in paragraphs 3 and 4.
8.	What are: (a) the names; (b) the degrees (with the names of the university from which they were issued); (c) dates of appointment; (d) occupations, professions or trades; (e) professions, and (f) salaries of each person mentioned in paragraphs 5 and 6?
9.	What is the total number of members of the personnel of the National Research Council?
10.	How many of them have not passed civil service examinations for the particular position that they hold now?



BUSINESS OF THE HOUSE


Right Hon. W. L. MACKENZIE KING (Prime Minister) moved:: That when this house adjourns on Friday, the 9th instant, it do stand adjourned until Saturday, the 10th instant, at 11 o'clock, a.m., and that the order of business and procedure shall be the same as on Fridays.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the orders of the day:
Jean-François Pouliot: In case prorogation should take place on Saturday or Monday next, will there be any other time for private and public bills than the hour to-morrow night from eight to nine?


William Lyon Mackenzie King: On Saturday night from eight to nine o'clock. The proceedings will be the same on Saturday as on Friday.


Mr. BENNETT:: But we do not sit on Saturday night.


Mr. LAPOINTE (Quebec East):: Yes.


Richard Bedford Bennett: We never do.



EXPORT OF POWER

[Stage Direction]
On the orders of the day:
Hon. W. D. EULER (Minister of Trade and Commerce):: I desire to correct a slight inaccuracy in a statement I made last night during consideration of the estimates. I said that no applications had been received for licences for the export of power and that no new licences are being given. I find that an application for a renewal licence for a very small amount of power has been received from the Minnesota and Ontario Power Company and is now under consideration.



PALGRAVE, ONT., POSTMASTER

[Stage Direction]
On the orders of the day:
Mr. GORDON GRAYDON (Peel):: I desire to direct an inquiry to the Postmaster General (Mr. Elliott). Information has come to me that the position of postmaster at Palgrave, Ontario, has recently been given to one who is not a returned soldier. Will the minister please inform the house of the number of returned soldiers who have made application for this position and what reasons exist in this instance for the selection of a postmaster without an overseas record?


Hon. J. C. ELLIOTT (Postmaster General):: I would inform the hon. member, who was good enough to give me notice of this ques-
Coronation Oath

tion, that according to the regular practice a temporary appointment only has been made. The permanent appointment will be made in the usual way. I understand that some returned soldiers are applicants.



CORONATION OATH

[Stage Direction]
On the orders of the day:
Mr. T. L. CHURCH (Broadview):: To clear up a misunderstanding, may I ask the Prime Minister (Mr. Mackenzie King) a question arising out of his remarks yesterday with respect to the coronation oath. Have not the words "to maintain the reformed Protestant religion" been struck out of the oath in so far as the dominions-Ireland, Canada, Australia, New Zealand and the Union of South Africa-are concerned for the first time since 1689? Do those words not remain now only in the oath as to the United Kingdom? They applied to the dominions until now also.


William Lyon Mackenzie King: May I say to my hon. friend that I do not think that the words he has cited have ever appeared in the oath, so they could not be stricken out. The words appear in the king's title, which is something quite different from the oath, and the king's title has been settled by legislation which was enacted, if I am not mistaken, in 1927. The words are not in the oath at all.


Thomas Langton Church: What I 6aid this morning is correct. See page 1442 of Hansard, March 3, for what you then said.


Mr. SPEAKER:: Order.


William Lyon Mackenzie King: I am afraid I misunderstood my hon. friend. The words that I had in mind were, "defender of the faith." Those are the words which appear in the king's title. As to the reference to the Protestant faith, as I understand it that has relation only to the United Kingdom; it has never been held to apply to the dominions.


Jean-François Pouliot: And the title "defender of the faith" was given by the Pope to Henry VIII because he was a good Roman Catholic at the time.



CANADIAN WHEAT BOARD


[Stage Direction]
On the orders of the day:
Mr. E. E. PERLEY (Qu'Appelle):: I should like to ask the Minister of Trade and Commerce (Mr. Euler) when the government intend to fill the vacancy on the Canadian wheat board caused by the transference of

Dean Shaw to Ottawa to a position in the Department of Agriculture; and whether, when doing so, they will give consideration to appointing a direct representative of the producers and giving the producers themselves some opportunity of making a suggestion.


William Daum Euler: My hon. friend did not give me notice of the question which he has just asked, and I regret that at the moment I can not give him any reply. Perhaps I shall be able to do so to-morrow or the next day.



CANADA-GERMANY TRADE AGREEMENT

[Stage Direction]
Hon. W. D. EULER (Minister of Trade and Commerce) moved the second reading of Bill No. 89, respecting a certain provisional trade agreement between Canada and Germany.
Richard Bedford Bennett: We will reserve any criticism we may desire to make until the bill goes into committee and will expedite its progress for *the moment by letting it pass pro forma.


Mr. SAMUEL FACTOR (Spadina):: Bill
No. 89, now submitted for second reading, seeks approval of the provisional trade agreement between Canada and Germany. I desire to take the liberty of voicing a few reflections on the subject of this new trade agreement consummated between Canada and the German government, aiming at the facilitation *of the exchange of commodities between the two countries.
I exceedingly regret that I cannot support a trade agreement with Germany, and I sincerely hope that hon. members will be tolerant enough to listen to my reasons, and understanding enough to appreciate the position I take. It may be that it is utterly futile to talk about a fait accompli. The agreement has been entered into; its provisions have been in effect since November 15 last. It may be that in discussing matters of trade and commerce, considerations of sentiment and human amenities must not be given play. It may be that in dealing with transactions that may spell profits to some of our citizens one is expected to shut one's eyes to the character of the source from which the hoped-for profits will flow. I fully realize that under present world conditions it is extremely difficult, almost impossible, for Canada to restrict her trade relations to countries that believe and practise our form of democratic government. Indeed, I am not advocating such a step. I readily concede that in negotiating trade agreements with other countries we cannot concern our-

Canada-Germany Trade Agreement
selves with the forms of government prevailing in those countries. It is certainly not our business to dictate to Germany or to interfere with Germany's domestic legislation. That would be resented, just as we should resent any interference by Germany or any other country with the internal affairs of Canada.
I should like to distinguish, however, between forms of government in countries with which we are trading or entering into agreements-which is none of our business-and the actions of governments, particularly when those actions are offensive to human civilization. Since the establishment of the dictatorship in Germany thousands of human beings have suffered persecution and outrageous offences against civilization. Mediaeval barbarities have been perpetrated against hundreds of thousands of people, which have shocked the moral conscience of the world. So far as Germany is concerned, it is no longer a question of internal legislation. Mr. Speaker, there are laws that are broader than domestic German legislation, laws of humanity and of God which are the foundation of all other laws; and if in any legislation they are violated all civilized nations have a right to speak aloud in protest.
Under the circumstances I feel that I have a right as a Canadian to stand up in this house and utter my protest. Indeed, I believe it is my duty to thousands of my constituents who have been insulted and humiliated beyond words. May I add this observation. My decision this morning to speak on this subject was arrived at after a good deal of consideration and some hesitancy. I hated to impose on this house and provoke a discussion at this stage of the session. In fact, I do not think there is any need of a long discussion. I have no desire to stir up and fan racial and religious prejudices. I would be the last man to say or do anything which would in any way embarrass the government, especially in the delicate and difficult task it has to perform in international affairs. But, Mr. Speaker, the fanatical policy of the present administration in Germany compels me to speak, and if I failed or hesitated I should be lacking in selfrespect, unworthy of the race to which I belong and what is more serious, unworthy of being a freedom-loving Canadian.
The German government has seen fit to heap calumny and abuse upon members of an historic race the world over. The German government has passed ghoulish ordinances in scores of German municipalities against the sale of milk to non-Aryan children and medicines to suffering human beings because of their religious profession. The German government has subjected thousands of Germans to
311H-173
frightful sufferings and has practised inhumanities against them because they believe in the ideals of government which are the very life-blood of this glorious democracy of ours.
These are facts. I am not exaggerating them. I am not taking newspaper reports. They are facts recounted in the devastating memorandum submitted to the secretary-general of the League of Nations, a memorandum submitted to the conscience of Christendom, by the Hon. James G. McDonald, former High Commissioner for German refugees. Mr. McDonald, as hon. members are aware, had been chosen by the League of Nations to investigate and deal with the problem of nazi persecution of Jewish and other liberals. He is, I need not mention, a forthright gentleman of Scottish extraction, as everyone knows who had occasion to meet him when he was in Canada a couple of years ago. I wish I had time to read the entire letter, but I will not impose upon.the house. I will give only a few paragraphs, and I should like hon. members to listen carefully to them, because I am sure Mr. McDonald is not prejudiced one way or the other in this matter. This letter of resignation is dated December 27, 1935. I quote from page 1:
In the period of over two years since the establishment of the office, conditions in Germany which create refugees have developed so catastrophically that a reconsideration by the League of Nations of the entire situation is essential. The legislation and administrative and party action against "non-Aryans" were steadily intensified, and culminated in the autumn of 1935 when a series of new laws and decrees initiated a fresh wave of repression and persecution of a character which was not envisaged in 1933.
The intensified persecution in Germany threatens the pauperization or exile of hundreds of thousands of Germans-men. women and children-not only Jews but also the "nonAryan " Christians treated as Jews, and Protestants and Catholics who in obedience to their faith and conscience dare to resist the absolute will of the national socialist state. Apart from all questions of principle and of religious persecution, one portentious fact confronts the community of states. More than half a million persons against whom no charge can be made except that they are not what the national socialists choose to regard as "Nordic" are being crushed. They cannot escape oppression by any act of their own free will, for what has been called "the membership of non-Aryan race" cannot be changed or kept in abeyance.
Relentlessly the Jews and "non-Aryans" are excluded from all public offices, from the exercise of the liberal professions, and from any part in the cultural and intellectual life of Germany. Ostracized from social relations with "Aryans," they are subjected to every kind of humiliation. Neither sex nor age exempts them from discrimination. Even the Jewish and "non-Aryan" children do not escape cruel forms of segregation and persecution. In Party publications, directly sponsored by the government, "Aryan" children are stirred to hate the Jews

2738	COMMONS
Canada-Germany Trade Agreement
and the Christian "non-Aryans," to spy upon them and to attack them, and to incite their own parents to extirpate the Jews altogether.
I shall not take time to read more. I think hon. members are quite aware of the terrible conditions prevailing in Germany. I do want, however, to read the last paragraph of Mr. McDonald's letter:
I feel hound to conclude this letter on a personal note. Prior to my appointment as high commissioner for refugees coming from Germany, and in particular during the fourteen years following the war;>
I gave in my former office frequent and tangible proof of my concern that justice be done to the German people. But convinced as I am that desperate suffering in the countries adjacent to Germany, and an even more terrible human calamity within the German frontiers, are inevitable unless present tendencies in the Reich are checked or reversed, I cannot remain silent. I am convinced that it is the duty of the High Commissioner for German Refugees, in tendering his resignation, to express an opinion on the essential elements of the task with which the council of the league entrusted him. When domestic policies threaten the demoralization and exile of hundreds of thousands of human beings, considerations of diplomatic correctness must yield to those of common humanity. I should be recreant if I did not call attention to the actual situation, and plead that world opinion, acting through the league and its member states and other countries, move to avert the existing and impending tragedies.
If time permitted I should like to have read to the house an analysis of the measures passed by the German government against non-Aryans, from facts contained in Mr. McDonald's memorandum. However, here is the memorandum, a document thoroughly authentic which has caused hundreds of noble Canadian ministers of the gospel sleepless nights with its stark challenge to Christian sensitiveness. A group of Toronto leaders of the church who read the McDonald letter of resignation together with the annex and other information therein contained were horror-struck, and in their mood of pain, humiliation and indignation they caused a number of copies to be distributed among their fellows in Christian service, so that their feelings of shame and commiseration might be shared by others in whom the ideals of humanity are not yet dead.
If I had time I should like to have read the manifesto issued and signed by leading clergymen and laymen in the city of Toronto, protesting against conditions in Germany. However, here is this document, the most comprehensive and drastic indictment of a government of a nation ever presented at the bar of public opinion. Every intelligent Canadian should read it and inform himself of the outrages practised against people belonging to the race, not of Isaiah or Amos

or the chanter of the Psalms, but of the race of Siegfried and Goethe and Schiller, a people who have lived in that land for a thousand years or more and have helped to build up its commerce and its industry, who have contributed magnificently to its art and its literature and its science, who have shed their blood and given their lives in the great war. This document is a searing reproach to the languishing conscience of our civilized community.
If time permitted I should like to submit to this house the terrific arraignment of Nazi-ism contained in the statement issued by the German Evangelical Church-the German protestant church. There are still many courageous, noble people in Germany, many who are ready to risk their freedom and even their lives to give utterance to their thoughts. There are still Christians there who love their God and their religion more than worldly advantage. They look with dismay at the profanation of their sacred beliefs by rulers who place their secular chief above or on a parity with God. This booklet is the outcry of the leaders of the German Christian religion against the ravaging of their faith by the neo-paganism of the nazis. Every god-fearing and God-loving person who reads this booklet issued by the heads of the Evangelical church, the Protestant church of Germany, will be upset. It will cause them pain and grief, so that they may not be in the frame of mind to pay due heed to the question of barter with the destroyers of religion. I have not time to submit to the house the statement issued by His Holiness the Pope on the ungodly effort to destroy the Catholic church and everything that is holy and sacred to those who profess the Catholic religion. Just the other day hon. members read the press dispatch issued from Berlin which announced that the neo-pagan doctrines were given the official status of a religion by the nazi regime. The statement is an insult to the word "religion."
I hope, Mr. Speaker, that you and hon. members of the house will appreciate my feelings and the feelings of thousands of people, Jew and Christian alike, who recoil from contact with a government that burns books and maintains concentration camps and tortures people who believe in the right to think for themselves. I hope hon. members will understand and sympathize with the feelings of thousands of people baited and hounded by the present German administration, and who shrink from the touch of any commodities bearing the stamp of German nazi production. I should like to remind the house

Canada-Germany Trade Agreement
that in Canada and other civilized parts of the world, particularly in the United States and England, there are countless people who refuse to purchase German nazi-made goods. Organized labour, the American Federation of Labour and the Trades and Labour Council of Canada, mindful of the havoc wrought by the nazi rulers to the great labour unions in Germany and the principles of trade unionism which they represent, are averse to buying goods made under conditions of totalitarian slavery. These two large bodies of organized labour stand on record by repeated commitments at their annual conventions as favouring the boycott of goods made in nazi Germany.
These are facts sir. I have made an analysis of the trade relations between Canada and Germany during recent years, and although time does not permit me to submit it to the house, there are many points in relation to which one could discuss the treaty on its merits. I merely want to say that I am forced to the conclusion that Germany will permit itself to buy as little as possible from Canada, will confine its purchases to such commodities as it stands in absolute need of, and from an interpretation based on indications discernible in statistics it seems clear that we stand to gain very little from the operation of the agreement, and that little perhaps at the sacrifice of trade with the United Kingdom. But that is not the purpose of my remarks this morning. If necessary I can go into that phase of the matter on some future occasion.
The other day, Mr. Speaker, the Minister of Justice (Mr. Lapointe) delivered a forceful, eloquent and masterly address in this house, which address I think should be placed in every Canadian home. I was never prouder of being a member of the Liberal party and a follower of the Prime Minister (Mr. Mackenzie King) and his government. The Minister of Justice spoke with great sincerity on the difficult problems facing the Canadian people to-day because of the subversive forces of communism and fascism which are attacking and endeavouring to undermine and destroy our democratic institutions. He spoke well of the way to fight both communism and fascism, not with swords or bullets, not with force or might, but with reason, charity, justice, and education. Yes, Mr. Speaker, conscience, human feelings, loyalty to traditional democracy; these considerations weigh heavily with legions of good Canadians who will not suffer themselves to be overborne by the appeal of the various isms. There are many people in Canada, and
31111-mi
I say thank God for that, who think more of the ideals of right and justice than of appeals to passion and prejudice.
In connection with our trade relationships with other countries is it too much to expect that this parliament should attach more significance to these cultural values than to the bare, cold items of barter and profit? The other day the Globe and Mail of Toronto in an editorial comment said that I did not concern myself with the fact that this German pact was in the interests of Canada. Well, sir, supposing that is so; is that the only consideration? Supposing it is profitable to Canada to sell frozen eels, sausage casings, salmon caviar, ice hockey equipment and even wheat and other commodities; are profits and balance sheets the only considerations? What about the ideals of right and justice, of liberty and freedom; what of our conscience? I want to make this final appeal to the conscience of every member of this house, to my fellow Canadians, lovers of French chivalry and traditional British freedom. Do not disregard, do not stifle the challenge of Mr. James McDonald, of the German evangelical church, of the Catholic church, of the Jews, all of whom have been outraged by pagan nazi-ism. Do not stifle the challenge of humanity at bay that will persist in echoing in our ears until its destiny is once again redeemed.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Short title.
William Daum Euler: Mr. Chairman, probably consideration of this bill will be facilitated if I explain quite briefly-I hope-the purposes of the bill, and give reasons why the agreement with Germany was made and, perhaps incidentally, correct some of the misconceptions which apparently obtain in some quarters.
The essential feature of the bill is that Canada and Germany agree with each other to accord what is generally known as the most favoured nation tariff treatment. That means that Canada gives to Germany tariff rates as favourable as she gives to any other foreign country. It also means that Germany gives to Canada tariff rates as favourable as she gives to any other country, with some slight exceptions to which reference may be made later. Perhaps I should also direct attention to the fact, that when we accord to Germany most favoured nation treatment, provision is made that any preferences now given to Great Britain or any of the dominions are excepted from the operation of the agreement. Germany does not obtain those advantages.

Canada-Germany Trade Agreement
Associated with the trade agreement proper is what is termed a payments agreement, which by the way does not require ratification by this house but the particulars of which have been printed in the Commercial Intelligence Journal; in fact the payments agreement was included in the documents which were tabled in the house last week. The vital and important factors in the payments agreement are twofold, and I should like the hon. member for Spadina (Mr. Factor) to take note of this, because he was apparently under some misapprehension with regard to them. The first feature is that Germany agrees and obligates herself to provide as much exchange, cash dollar exchange, for the purchase of Canadian goods, as Canada buys from Germany. The second feature of the payments agreement is that of the exchange so described, that is, the full amount of the sales to Canada by Germany, she agrees to provide exchange in certain definite proportions or percentages for the purchase of certain commodities which we are particularly desirous of selling to Germany, commodities for which Germany is peculiarly a market and which I can and perhaps will name later on. Those commodities comprise sixty-three per cent of the total exchange which Germany shall provide and which, as I said before, must be equal to the full one hundred per cent of all the imports we receive from that country.


Mr. HEAPS:: Does the minister think it is always possible to have an exact balance between the two countries?


William Daum Euler: No, and under this agreement it is not necessary; it does not become compulsory at all. There is a misconception with regard to that, and I will come to that later.


Mr. LAWSON:: Would the minister state what commodities are to comprise that sixty-three per cent?


William Daum Euler: I can name them if it is desired; they have been printed.


James Earl Lawson: I did not get the significance of the statement.


William Daum Euler: I may as well take them up now, I suppose. These commodities comprise sixty-three per cent of the total for which Germany agrees to provide exchange in certain proportions. We will take one hundred per cent as the total, and these particularly named commodities comprise sixty-three per cent of the total.
Wheat comprises 35 per cent. That is more than half of all the designated commodities. We thought at the time that wheat was a commodity for which we should make sub-

stantial provision. Fortunately since the agreement was made and since negotiations were carried on in Berlin the wheat situation has been altered so materially and so favourably that at this time it is perhaps not so important as it was at that time, but the need may arise again.


Mr. STIRLING:: Does that mean 35 per cent of Germany's total purchases from Canada?


William Daum Euler: 
Abraham Albert Heaps: Suppose Germany buys a good deal more than she has in the past, are we on the other hand compelled to buy from her?


William Daum Euler: 
James Earl Lawson: Germany was then paying the general tariff rate.


William Daum Euler: This agreement replaces the more or less loose agreement which was brought into operation-


Richard Bedford Bennett: No; we exchanged the intermediate tariff.


William Daum Euler: Canada was supposed to be getting the benefit of the most favoured nation treatment from Germany, whereas we gave her the intermediate tariff, which at that time was practically the same thing. As compared with 1929 our exports were down ninety per cent while our imports were down only in the neighbourhood of fifty-five per cent-There were reasons other than the depression for this reduction. All business with Germany was being subjected to such severe1 restrictions that it was becoming impossible to do business. As I have said, our business relations with Germany were threatened almost with extinction so far as exports were concerned. Apparently she was giving us what we called most favoured nation treat-

Canada-Germany Trade Agreement
ment, but the benefits of the most favoured nation arrangement were nullified by the introduction, I think about 1931, of a system of exchange control. As hon. members of the committee know, this simply meant that Germany would allow money to be sent to other countries from which she bought only as permits were granted according to the decisions of the various trade control boards which they had set up in connection with various commodities. By 1935 it became impossible for German importers to buy Canadian goods, even if they desired, as many of them did, to import Canadian merchandise because the German government would not make provision for payment therefor.
As I say, permission was withheld from the German importers to purchase goods because no exchange was provided for them. In the first quarter of 1934 Germany's imports of Canadian goods were nearly two per cent of her total imports, but because of these restrictions the proportion dropped _ to about one-quarter of one per cent. I am going on to show that Canadian exports to Germany decreased to a much greater degree than the exports of other countries to Germany.


Abraham Albert Heaps: Did not the fact that payments were not being made have something to do with that?


William Daum Euler: The principal reason was
that other countries had made payment agreements with Germany, just as we are now seeking to do.


Abraham Albert Heaps: Were those lived up to?


William Daum Euler: I do not know anything of Germany's internal trade relations with other countries, but I believe they were. The German importer could obtain only a small amount of cash dollar exchange which was used largely for the purchase of raw materials instead of commodities which we were particularly desirous of selling. This being so, barter was also resorted to. Then the German government instituted such restrictions that barter trade became almost impossible. While at first the German importer was permitted to barter on the basis of one for one, in 1935 Canada had to accept three dollars' worth of German goods for every dollar's worth of many commodities that she sold to Germany. I think hon. members will realize that we were rapidly getting into an almost impossible position.
I might refer briefly to wheat. Some years ago we sold as much as 40,000,000 bushels of wheat in a year. Germany then began a campaign of increasing production, which met with considerable success, but in 1934 she

still imported 23,000,000 bushels, of which Canada supplied nearly 16,000,000 bushels. Just one year later, in 1935, all she took from us was a paltry 316,000 bushels.


Richard Bedford Bennett: What were her total importations from the world? Was she then supplying her own wheat?


William Daum Euler: In 1934 she imported 23,000,000 bushels.


Richard Bedford Bennett: But in the latter year?


William Daum Euler: In 1935 she still imported
5.838.000	bushels of which we supplied only
316.000	bushels. Our ratio decreased greatly as compared with the imports from other countries. While she was importing only one-quarter of what she had imported before, our proportion decreased to one-fiftieth.
As I said before, Germany largely confined her cash purchases to raw materials and other things that she could not obtain by barter. For these reasons, negotiations were opened last summer with the German representatives in Berlin. The Canadian delegation was composed of Mr. Wilgress, the director of the commercial intelligence service, and myself. I hope I do not embarrass him when I say. in his presence that his services were almost invaluable because of his intimate knowledge of all the details of the business we carry on with other countries. We proposed that each country should give to the other most favoured nation treatment and that a payments agreement should be arranged under which Germany agreed to provide at least as much cash exchange as the value of the goods Canada buys from Germany. That proposal was accepted in principle almost immediately, but the German government still desired to confine their purchases as much as possible to raw materials. We pointed out to them that there were certain raw materials she was almost bound to purchase from us and that in connection with others we had no difficulty in finding markets in other parts of the world. We stated that we did have commodities which were specially adapted to the German market, and we desired that provision be made for the sale by Canada of these commodities. Particular reference was made to wheat and other commodities which I have mentioned. There was a lengthy discussion with regard to this, but finally the schedule was drawn up as I read it and which will appear on Hansard.
I repeat that this schedule does not preclude Germany from buying in excess of the percentages or amounts which she has agreed to buy. If she desires to buy apples to the

Canada-Germany Trade Agreement
extent of a million dollars, she may do so, but she must allocate in these percentages to the commodities as stated there the full amount, according to the sales which she makes to Canada.


Abraham Albert Heaps: Are we not compelled to buy an equivalent amount from Germany?


William Daum Euler: We need not buy anything if we do not want to. Perhaps this will answer the hon. member for Spadina. Those who do not wish to buy German goods are under no necessity to do so because of this agreement.


Richard Bedford Bennett: If we do, the exchange has to be dealt with through a clearing house.


William Daum Euler: There might be another
method, but that can be discussed later. It is quite possible that there will be an adjustment of these percentages. They are frankly experimental. Provision is made for an examination of the operation of the agreement every six months, and it may be found to the mutual advantage of the two countries to make some changes in the percentages as they are outlined here. In the meantime I want again to make it perfectly plain, because I know there is a misconception, that Germany binds herself to provide exchange for at least as much as we buy from her, and there is no limitation as to what she may buy from us.


Abraham Albert Heaps: Suppose we do not buy anything from Germany, does she then buy anything from us?


William Daum Euler: She is not bound to. There is nothing to prevent her. I should like to point out to my hon. friend that this agreement represents an improvement at least on the previous situation. She has had free access to our markets under the intermediate tariff. She could and she did apply these restrictions by way of exchange control, and restrictions even in the matter of barter, which established a balance in her favour of two to one. At least we get rid of that situation. We shall have provided in the matter of exchange an amount equal to the amount that we buy from her. There is nothing to prevent her from buying more, but if we buy more, for instance if we buy to the value of $20,000,000 from her, she must provide exchange for at least $20,000,000, and she may go in excess of that as far as she pleases.
There may be some criticism regarding the items which have been included in this schedule. Some Canadian producers may feel that their commodities should have been included. My answer to them is that we felt that these are the commodities which Canada is particularly desirous of exporting-wheat,
for instance, and some other natural products for which Germany provides an exceptional market. But there is nothing to prevent a Canadian producer whose commodity is not listed in this schedule from selling his product to Germany, because out of the 100 per cent exchange which she must provide, 37 per cent is perfectly free, and Germany can buy, to the extent of 37 per cent out of the 100, whatever she pleases. It is up to the Canadian manufacturer or producer to make his sales to Germany. That country is under no restriction; in her purchases from Canada she can go, of course, even beyond the 100 per cent of what she sells to us. This statement may be repetition, but I want to impress upon the committee that as our imports increase, if they do, Germany must provide the full 100 per cent of exchange for the purchase of Canadian goods.
Probably it is too early for me to pass a considered or even an intelligent opinion as to the working out of the agreement, for it has been in force only since November 15. Some defects may be found, and provision is made for their correction. It is interesting however to note that for the first time in two years the balance of trade is in favour of Canada. For the three months, December, January and February, exports have amounted to $3,030,000 and imports to $2,485,000.


Abraham Albert Heaps: Of what did the major portion of those exports consist?


William Daum Euler: There was some increase in their purchases of wheat. This represents a sharp reversal in the balance of trade; in fact our exports in December to Germany were nearly twice what they had been in the corresponding month of the previous year.


Abraham Albert Heaps: Was not wheat the main item of export last December?


William Daum Euler: A million dollars in the three months.


Richard Bedford Bennett: Yes. Germany reduced the duty to 11 cents a bushel as against 93 cents, because of the poor harvest in that country.


William Daum Euler: I am not going to claim at the moment any special merit for the agreement-it has not been in force long enough- but the fact remains that for the last three months we have had a favourable balance of trade.
I am not sure whether I should deal so fully with the payments agreement, but it is so definitely associated with the whole proposal that I think I should discuss it.

Canada-Germany Trade Agreement


Richard Bedford Bennett: I think the minister should.


William Daum Euler: As I said, it does not require ratification by parliament. The granting of most favoured nation treatment does.


Richard Bedford Bennett: Of course the minister knows that the late government was not prepared to establish clearing agreements, as a matter of policy.


William Daum Euler: This is not a clearing agreement, it is a payments agreement. There is quite a difference.


Richard Bedford Bennett: Records must be kept, and it operates in the same way as a clearing house agreement.


William Daum Euler: Perhaps I should go into that a little further. One of the reasons why our exports to Germany fell so disastrously was that Germany and other countries, including Great Britain and South Africa, were making similar payments agreements, with the result, I suppose, that those other countries insisted that Germany should buy certain commodities from them; and in order to trade with those countries she just subtracted her imports from Canada. We desire to be put on somewhat the same basis in regard to Germany as are other exporting countries, and we are now, I think, on much the same basis, at least to the extent of equality.
The payments agreement provides that by the fifteenth of each month Germany shall provide foreign exchange to the extent of our purchases of the previous month but one.


Richard Bedford Bennett: Has she done so?


William Daum Euler: I rather expected that question. I must admit there has been a little delay, and upon my return I made inquiries. I have a letter, which I can place on the records if it is desired, from the acting German consul in which he admits that there was some delay.


Richard Bedford Bennett: No, but the actual fact is, she has established the exchange called for by the agreement?


William Daum Euler: Yes.


Richard Bedford Bennett: She has?


William Daum Euler: Yes.


Richard Bedford Bennett: That is all that is
necessary.


William Daum Euler: I am assured by the German authorities that there will be no further delay in providing these returns. In fact they go as far as to say-which they are not called upon to do-that besides notifying the government of Canada of the amount of exchange
	. .jj
that is available they are communicating that information direct to our trade commissioners in that country and are thus facilitating business which may be done by Canadian exporters.


Richard Bedford Bennett: If I follow the minister correctly, suppose I buy to-day from a German manufacturer an invoice of goods for $10,000; instead of that money being sent back to Germany at once, there must be provided for me $10,000 that is to be utilized in the purchasing of products of some kind, 37 per cent being free and 63 per cent being within the class named. Is that a correct statement of it?


William Daum Euler: I am afraid my explanation was not very clear. If my right hon. friend purchases $10,000 worth of German goods, that money of course is remitted to Germany. That is reported finally to the German Reichs-bank, and in respect of that amount, as well as other amounts that have been sent on account of sales to Germany, exchange is provided in the proportions which I have mentioned.


Richard Bedford Bennett: Yes, but there must be provided the aggregate of exchange for the aggregate purchases from Germany.


William Daum Euler: Quite so.


Richard Bedford Bennett: If during the month the total purchases are $100,000 there must be available on the fifteenth of next month $100,000 of Canadian money with which to pay for Canadian products?


William Daum Euler: Yes, but my right hon. friend, or whoever may be the Canadian exporter, if he be careful, will make certain that exchange is provided for the sales of goods he makes.


Richard Bedford Bennett: Quite; and the minister says there is no clearing house. If there were a clearing house the record would be here and it would be available. As it is now we have to take our chances on its being made available. That is the whole point. As the minister has said, there has been a delay, and we have no reason to believe that there will be any delay in the future, because they have now provided the exchange called for by the agreement during the two months that it has been in operation. The fifteenth day of the months of December, January, February and March will be the four relevant dates on which the exchange will be provided. A clearing house would have made it clear beyond peradventure that the amount of purchases thus made from Germany would be convertible into a fund available to pay

Canadci-Germany Trade Agreement
for Canadian goods. As it stands now the obligation of the German Reichsbank is to provide us with exchange for the sum total of our purchases from them during the preceding month, and it is not provided that there shall be any control in any sense over the exchange that arises from the sale of German goods to Canada. The remitting of it goes straight to Germany and we have to depend upon their ability to provide exchange to meet the obligation called for in the agreement. That has already resulted in some delay, which is now remedied. My point is that there is no assurance that Canadian purchases from Germany under the clearing agreement-to which I think there are certainly great objections-will be convertible through a clearing house agreement to pay for the goods which Germany buys from us. But there is a further limitation; sixty-three per cent of it is earmarked, of which thirty-five per cent shall be for wheat, twenty-eight per cent being for the other commodities mentioned; while thirty-seven per cent may be utilized in any way that may be thought desirable by the traders in the two countries. That is the story as I understand it. I want the minister to correct me if I am under a misapprehension.


William Daum Euler: I gather from my right hon. friend's remarks either that he has a doubt as to the ability of Germany to provide the exchange which the agreement calls for or that he doubts her good faith in the matter. One of the two must be assumed.


Richard Bedford Bennett: The question of good
faith you can leave out.


William Daum Euler: Perhaps I am attributing to the right hon. gentleman something that I should not, but that is the only inference that I can draw from his observations. I have no reasonable doubt about Germany's ability in the matter, but if she does fail for any reason whatsoever we have some protection to which I shall refer later.


Richard Bedford Bennett: The agreement apparently contemplates that possibility.


William Daum Euler: Despite the opinions that
some people hold regarding the good faith of Germany-


Richard Bedford Bennett: I was not discussing the question of good faith.


William Daum Euler: -I have every reason to believe that she is acting in good faith and will continue to do so under this agreement. But if she does not there is provided what is known as an escape clause, with which
my right hon. friend is familiar. Under that clause, if for any reason whatever we find that the agreement is not satisfactory, if the agreement is not working to our advantage, or if Germany finds that it is not in her interests, then either country can make representations to the other, and if, after four weeks, the matter is not adjusted to the satisfaction of the complainant, then another six weeks' notice will terminate the agreement. That is the escape clause.


Grote Stirling: How does the Canadian exporter ascertain, particularly when the end of the quota is approaching, how much credit there is to him?


William Daum Euler: His customer in Germany will know. His German customer will have to make provision for payment of the goods and he can get it at the Reichsbank.


Grote Stirling: Take Nova Scotia apples in Germany, for instance.


William Daum Euler: There is an agreement between the importer in Germany and the Canadian exporter, and the importer before making a contract will assure himself that the exchange will be provided for him. As regards apples, it is too early to judge of the success or otherwise of the agreement, but since it has been in force the apple growers, chiefly those in Nova Scotia, have sold to Germany $277,000 worth.


Grote Stirling: Nova Scotia only.


William Daum Euler: And it has been described as a godsend to the apple producers.
I wish now to refer to something else, which is outlined in a letter that was among the documents I tabled last week. In our conversations with the German representatives, both in Berlin and in Ottawa, the German representatives maintained that the computation for duty purposes of exchange value of the reichsmark at the current rate of forty cents, as compared with the par value of nearly twenty-four cents, places an unfair and almost impossible handicap upon the sale of German goods. He contended that Germany had been able to compete abroad only through the device of the blocked mark. Those who have visited Germany in the last year or two know that in London you can purchase German marks at a considerable discount and take them to Germany, exchanging your certificate for marks worth their full value over there.


Richard Bedford Bennett: There is a limitation.


William Daum Euler: These are registered marks. There are, of course, marks of different kinds- the blocked mark, the aski mark, and the

Canada-Germany Trade Agreement
registered mark. The German representative contended that Germany had been able to compete abroad only through the device of blocked marks, which enabled importers to secure German exchange at rates below the current rate officially quoted for the reichsmark. The use of these cheaper forms, however, for the sale of German goods to Canada is henceforth precluded by the provisions of article VII of the agreement, and I think it is well that it should be so. It is a most inconvenient and unbusinesslike way of paying for goods. It is urged-and I should like the committee to listen to this, because the point will probably be discussed-that some lower rate than the current exchange rate should be used for computing the value of German goods imported into Canada. In other words, we were asked to recognize that the current exchange value of the reichsmark, forty cents, is an arbitrary one which does not represent the true value of German currency in international trading transactions. We made no binding commitment on this point but we did agree, and it is so stated in the letter signed by myself which is among the documents tabled the other day, that parliament would be invited to amend the law to empower the Canadian government to adjust the rate of exchange, for duty purposes, of appreciated currencies. Perhaps it is not right to call the German currency appreciated; it is appreciated in relation to ours, which is really depreciated.


Abraham Albert Heaps: Would the minister apply the same principle to all countries?


William Daum Euler: As a matter of fact, when the discussion took place in Berlin, this matter affected not only Germany but other countries that had a relatively appreciated rate of exchange, such as Switzerland, Holland, Italy, and, I believe, Belgium, Switzerland and Holland particularly brought to our attention the fact that because of the higher valuation of their currencies it was difficult for them to do export business.


Richard Bedford Bennett: Had they gone off the gold standard then?


William Daum Euler: 
Richard Bedford Bennett: And the substitution of barter for ordinary trade.


Abraham Albert Heaps: If you are going to put the duties down on goods from countries with appreciated currencies, what is going to happen to countries with depreciated currencies?


William Daum Euler: As we have provision in the customs tariff for adjusting the currencies of countries which are depreciated, perhaps it is not illogical to give the same power in regard to currencies which are relatively appreciated. At any rate we agree to present to parliament legislation giving the government power to do that. We further agree that, this having been done, if and when Germany, as doubtless she will, makes representations requesting that we fix a lower rate than the 40 cent rate which now obtains on the mark, we will give it prompt consideration.


Richard Bedford Bennett: That is the international mark, the gold mark?


William Daum Euler: Yes, the gold mark.


Richard Bedford Bennett: With par value of 25 cents.


William Daum Euler: Twenty-four cents, which in our currency now is supposed to be worth 40 cents. I would however point out that while we agreed to take the power, the government still retains the right to use its judgment according to the terms of the undertaking. I assure the committee that the government of Canada retains complete control over the matter and that no action will be taken unless Germany can prove to our satisfaction that she has a just case. Then finally if any producers in Canada, manufacturers or others, have any fears with regard to the matter I might point out two things. We on this side stated during the last election campaign-I know I stated it, the leader of the government stated it-that it would not be the intention of this government to injure any legitimate Canadian industry. Further, if we find that the agreement is not working out to our satisfaction and if we cannot get an adjustment with Germany in regard to it, we have the power within a minimum.period of ten weeks to cancel the agreement in its entirety.
In conclusion I say quite frankly that the agreement we propose is more or less experimental. It is designed to facilitate the extension of Canadian trade in wheat and the commodities which we have to sell, in a market which in past years was extremely valuable to us. I believe that this agreement does offer a reasonable means for expansion of Canadian exports, and further is in accord with the belief of this

Canada-Germany Trade Agreement
government-and I think it is shared by most other countries of the civilized world, although they are not carrying it into practice-that a freer exchange of commodities between the nations of the world would be a greater guarantee of peace than all the great armaments with which the nations are equipping themselves.


Mr. CAHAN:: Did the minister during his investigation in Germany make an inquiry as to different kinds and values of marks in Germany? During the last year I certainly came in contact with four, and possibly five, different kinds of marks of different values. It is well that the commercial community should be advised as to the sort of marks they are dealing with when they discuss the sale of goods to Germany or the purchase of goods from Germany.


William Daum Euler: When goods are sold to Germany the German customers remit in cash dollars according to the invoice of the Canadian exporter.


Charles Hazlitt Cahan: Canadian dollars?


William Daum Euler: Canadian dollars.
Mr. CAIiAN: And when we purchase from Germany what must we remit?


William Daum Euler: That is why we are asking authority to fix the rate. I do not know that this is the time to discuss it; a resolution is now on the order paper which anticipates a bill of which the Minister of National Revenue is in charge. The question which my hon. friend has raised I assure him is a very difficult one.


Charles Hazlitt Cahan: That is why we should be advised.


William Daum Euler: I do not know whether my hon. friend is asking me now as to what rate we are going to put on the German mark. When this legislation goes through it empowers us to fix a rate. I do not know what that rate will be, what the change will be, what the reduction will be or whether there will be any reduction, but I can assure him that the German government must make its case before we shall consent to the fixing of a rate less than 40 cents. The government is asking for the power, and it will have to take the responsibility for whatever action it takes, if any, when the time comes.


Charles Hazlitt Cahan: All I was asking the minister was whether he was prepared to outline the problem so that parliament and the public may be advised.


William Daum Euler: I am not sure that I can offer the committee anything valuable on that. My hon. friend asked as to the various kinds of marks that obtain in Germany. I have here a memorandum which discusses blocked or registered marks, and aski marks as they are called, barter or compensation marks, and so on. I doubt very much whether it would be of any great value to the committee to have it read. But I think payment for most of the sales to Germany has been made by buying registered marks from the United States banks to Germany, which they have sold to Canada at a discount of, I think, 25 per cent. It is a difficult and complicated problem, and I question very much whether at the moment I can add anything of value to the discussion. The Minister of National Revenue will no doubt do so, because it will fall within his department, and I am sure there will be no change made that we think would be deterimental to the interests of Canada or unfair to Canadian producers.


Charles Hazlitt Cahan: Quite so, but the whole administration of the customs might be left to the government-


William Daum Euler: That is done, isn't it?


Charles Hazlitt Cahan: -relying on their good faith that they will not do anything that is likely to injure Canada. But I was inquiring a little more closely. Perhaps at another time- I do not suggest that it be done now-either the Minister of Trade and Commerce or the Minister of National Revenue will find it expedient to make a full explanation to the house in regard to the problem.


Richard Bedford Bennett: Dealing with international marks, Germany buys from Canada a certain quantity of goods and we buy from Germany a certain quantity. If I owe them 10,000 marks, and if for duty purposes there is one value and for the purpose of payment another, obviously we are giving them an advantage that we have to think about very carefully.


William Daum Euler: But that will be reflected in the price the German asks.


Richard Bedford Bennett: We have already indicated that there are several kinds of marks. The mark that has a value of 40 cents is the old mark, which was the equivalent of the French franc, the Belgian franc and other currencies of the continent. It was a gold -mark, and it now sells in Canada for 40 cents. Therefore if I buy a bill of German goods for 1,000 marks I have to remit 1,000 marks. I go to my banker and ask for exchange on Berlin for
2748	COMMONS
Canada-Germany Trade Agreement
1,000	marks. He -may be able to get it for me for 40 cents; if he gets another kind of mark he may be able to get it for very much less.


Mr. ILSLEY:: That is the only kind you will buy.


Richard Bedford Bennett: The stipulation by the seller, then, is that it must be an international gold mark, which means a 40 cent mark. In dealing with depreciated currencies we have said that the market value, for example in the case of Japan, is to be determined by the average value of the yen over a period of three years.


James Lorimer Ilsley: Five years.


Richard Bedford Bennett: Quite so, over a period of five years. With respect to the mark it is now assumed that we are to enact legislation that will place on it a value that is not in keeping with the value for market purposes among the financial institutions of the world. That is an entirely different thing, because on an average of five years or three years or whatever it may be the price has remained fairly constant, because it is a gold mark.
But there is another side, it seems to me, that must be considered; that is, what will be the effect upon our Canadian industries and the Canadian economic structure? That is a matter which I think will have to be given some consideration. It will be recalled by the minister that we issued a proclamation placing a certain value upon the currencies of the various nations of the world, known as the par value. The pound was fixed at $4.86|; the United States dollar at SI; the yen at 49-865 cents and so on. The par value of the gold mark is 24-666 cents; we generally speak of it as a quarter, as on a par with the French gold franc. These are the par values, and any departure from par value may be by depreciation or appreciation. We have dealt with depreciation by our statutes. We now propose to deal with appreciation, but the rules governing with respect to depreciation involve the dumping duty. The rules governing with respect to appreciation would leave in the hands of the executive an arbitrary power to fix a lesser rate for duty, because the amount of the invoice thus would become lessened and therefore less duty would be payable than would be payable in terms of the present commercial value of that currency. In the second place it would involve the purchaser still making payment in the terms of the invoice, unless it was a bogus invoice, but when he goes to purchase the number of marks required for duty purposes he is going to pay on an entirely

different basis. That does seem to me to be wrong. I see what the government is trying to do, but I must say I do not think this is a very good method.


William Daum Euler: It is frankly experimental; it may not work out as we would hope.


Richard Bedford Bennett: So far as the general principle is concerned, three years ago, in 1934-35, I said in this house that my mind was definitely opposed to what are called clearing agreements. They are the negation of international trade, because they involve balanced trade. As I said then, I heard a French economist make a very able presentation of the case, but if you make universal application of that principle you destroy the whole theory of international trade.


William Daum Euler: - I quite agree.


Richard Bedford Bennett: That being so, by this
agreement we are now endeavouring to balance imports and exports. I realize the weight of the circumstance to which the minister has pointed, namely the lessening of the purchases from this country by Germany. The arrangement whereby Germany agrees to purchase from us to the full extent that we purchase from her has undoubted advantages. No one would deny that for a moment, but on the other hand the application of the most favoured nation treatment to German imports plus the proposals with respect to currency I think will create a condition that will induce the minister to realize that the experiment is not to bring those advantages of balance that he contemplates. I only hope his expectations are realized, but certainly applying the logic of events to the situation, this arrangement cannot be beneficial to this country in the long run though there may be temporary benefits. Under the circumstances I think the provisions the government have made for escape are as reasonable as could be expected. That is, provision is made for practical termination of the agreement within a period of about ten weeks. But it will be observed that the agreement is to end in November, 1937.


William Daum Euler: It continues after that until notice is given.


Richard Bedford Bennett: Quite so, but apparently the minister did treat this purely as an experiment, because he has provided for the termination of the agreement on November 14, 1937, subject to the provisions of article Y, under which a speedier termination may be brought about if events so warrant. On the other hand the agreement shall continue in force until two months from the date when either

Canada-Germany Trade Agreement
party shall give notice. So in the true sense of the word it may be said to be experimental.
The situation can be summarized, I think, in this way: prior to the agreement being made there was an arrangement between Germany and Canada whereby we gave Germany the benefits of our intermediate tariff and Germany gave us her minimum tariff.


William Daum Euler: No, I think Germany gave
us her most favoured nation treatment and we gave her our intermediate tariff.


Richard Bedford Bennett: That is what I describe
as the most favoured nation treatment. It was a long process to get Germany that far, as the minister knows. The only case in which Canada ever took reprisal action against any country was when the late Mr. Robb found it necessary to take action he did take against Germany because of that country's treatment of our imports; that was so until we availed ourselves of exactly the same provisions of the law with regard to Japan. From that time on there were certain difficulties in connection with our trade with Germany, but finally the late government made an agreement whereby we accorded Germany the benefits of our intermediate tariff only and they gave us most favoured nation treatment. At that time the duty against wheat was $3.63 a bushel. It was subsequently reduced to 93 cents, which was the rate per bushel that prevailed when we made the agreement with Germany. Since then it has been reduced to 11 cents per bushel because of the shortage of foodstuffs in Germany, and speaking subject to correction I believe it stands at that figure to-day. So this may be beneficial at a time when there is a shortage of wheat and when Germany finds difficulty in supplying the food requirements of the people; I think it will be, because their purchases of wheat from us in December, 1936, amounted to about $1,000,000. To that extent I think it may be said to be advantageous.
I am not going to repeat what I said a moment ago as to whether or not Germany is in a position to maintain the supply of exchange called for by the agreement, without any provision being made for the lodging of that exchange, in this country, as is done under the clearing agreements that are in operation in Europe. I certainly was not reflecting in any sense upon Germany, for I think more perhaps than any other country Germany is anxious to create confidence among the peoples of the world in her good faith in negotiating agreements. But I had reference to her ability to do so, having
regard to the obligations contracted with respect to other countries, where she maintains barter arrangements, as the minister must know as well as I do. Barter arrangements do not all contemplate provisions with respect to clearing agreements, although most of them are predicated upon that. So with respect to barter with some of the Balkan countries and some others there is a leeway provided as against absolute balance.
This contemplates a balance, without ensuring in any sense that the money derived in the form of exchange shall be available in payment for Canadian goods. There is no assurance that it will actually be available; only the assurance that they will make it available, but not available out of purchases made by Germany, and to that extent therefore we are dependent upon her ability to provide for it. A seller of Canadian goods may make a most extensive inquiry, but he has no assurance other than the report made on the fifteenth day of the preceding month as to what his real position is.
I cannot bring myself to believe that these clearing arrangements are in the interests of world peace, if international trade means world peace. But they are a part of the financial and economic machinery of many European countries at the present time. Even Great Britain was compelled to utilize them in part in connection with certain trade carried on- trade which was much vaster than our own. As the minister has very truly said, this is an experiment. Having presented it to the house as such, I do not think any good purpose would be served by my making any further observations.


Charles Hazlitt Cahan: In the comparison the minister made between the appreciation of the value of the yen, or the fixing of the value of the yen for trade between this country and Japan, and the value of the mark, there is this signal difference:	The yen which
serves to fix the value for duty purposes in Canada is the same yen with which Japan pays its employees. Japanese industry is based on it, and domestic trade is carried on on the basis of that same yen. But the mark which we are discussing, namely the international mark, and the fixing of the value of the international mark for duty purposes, is not the mark which forms the basis of domestic trade and industry in Germany. It is a different mark altogether. No supplier of materials in Germany for the use of German industry is paid with the mark the hon. member was discussing a few moments ago. Therefore when we come to discuss a further question
Customs Tariff Amendment

which, I understand, is within the domain of the Minister of National Revenue some consideration must be given to the fact that while the yen is the same yen which circulates in Japanese domestic trade and industry, the mark which we are discussing is not the same mark which circulates in Germany for the purpose of paying wages and supplies.


William Daum Euler: There is only one mark, except that in some cases restrictions are placed upon the use of it.


Charles Hazlitt Cahan: Restrictions?-I have not
examined them for six or eight months, but if the minister will look at those restrictions he will find that marks are as different as Canadian dollars and Mexican dollars. While they are called marks, with some nominal preface determining their character, quality and use, they are in reality as different as if they were different currencies.


[Stage Direction]
Section agreed to.
Sections 2, 3 and 4 agreed to.
Schedule agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Bill No. 112, for the relief of Rosalie Annie Arathoon Webster,-Mr. Plaxton.
Bill No. 113, for the relief of Minnie Sidilofsky Sadegursky,-Mr. MacKinnon (Edmonton West).
Bill No. 114, for the relief of Simone Baillargeon Mann,-Mr. Walsh.
Bill No. 115, for the relief of Thelma Lucille Farr,-Mr. Ross (St. Paul's).
Bill No. 116, for the relief of Sybil Geddes,- Mr. Graydon.
Bill No. 117, for the relief of Maurice Amedee Tremblay,-Mr. Jacobs.


[Stage Direction]
Hon. J. L. ILSLEY (Minister of National Revenue) moved that the house go into committee to consider the following proposed resolution:
That it is expedient to amend section 6 of the Customs Tariff to provide that, notwithstanding the provisions of any other law, the governor in council may from time to time, and as occasion requires, and without having regard to the requirements of section 55 of the Customs Act, order and direct, subject to such exceptions as may be made, what shall be the rate of exchange fixed for any currency in computing the value for duty of goods imported into
fMr. Cahan.]
Canada from any place or country, the currency of which is appreciated in terms of the Canadian dollar; and also to provide that in cases where, under such power, the governor in council shall have fixed the rate of exchange for any currency in computing the value for duty of goods imported into Canada, special or dumping duty shall not apply when the export or actual selling price is equal to or greater than the value for duty so computed, and where the same is less than the value for duty so computed, special or dumping duty applicable shall not be greater than the difference between the said export or actual selling price and the value for duty so computed.
Motion agreed to and the house went into committee, Mr. Sanderson in the chair.
Richard Bedford Bennett: If the minister is prepared to permit discussion when the bill is introduced, there is no reason why the resolution should not pass.
Resolution reported, read the second time and concurred in. Mr. Ilsley thereupon moved for leave to introduce Bill No. Ill, to amend the customs tariff.
Motion agreed to and bill read the first time.
At one o'clock the house took recess.
The house resumed at 'three o'clock. HALIBUT FISHERY



AMENDMENTS TO CONVENTION BETWEEN CANADA AND THE UNITED STATES

[Stage Direction]
Right Hon. W. L. MACKENZIE KING (Prime Minister) moved the second reading of Bill No. 90, respecting a certain convention between Canada and the United States of America, for the preservation of the halibut fishery of the northern Pacific ocean and Bering sea, signed at Ottawa on 'the 29th day of January, 1937.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Short title.
Mr. HANSON:: Before the bill is passed I should like to put on Hansard a few suggestions that were brought to my attention by the halibut industry of Prince Rupert, which represents about eighty per cent of the halibut industries of Canada. They wired to me as follows:
We recommend that a new halibut treaty and provision be included barring boats of non-treaty countries using our ports in case they fish halibut on our grounds. Seattle fleet advocating same at Washington. Please take this matter up.
Canadian Halibut Fishing Vessel Owners Association.

Halibut Fishery
I made representations to the government and they assured me that consideration would be given to the suggestions made by the Prince Rupert halibut industry. I hope that this has been done in connection with this bill.


William Lyon Mackenzie King: May I say to my hon. friend that he will see, upon looking at the bill, that section 9 covers the matter which he has in mind. It reveals that the government has not overlooked the matter he brought to its attention.


[Stage Direction]
Section agreed to.
On section 2-Definitions.
Mr. REID:: I wish to draw the attention of the Prime Minister to a suggestion which I made when the sockeye salmon treaty was before the house. I think consideration should be given to the question whether it is not possible to have Hecate straits designated as territorial waters or inland waters, similar to the Hudson bay straits. It might avoid trouble in the future if that were done.


William Lyon Mackenzie King: The convention has already been approved by the United States, and it would not be possible for us to change the convention as approved. But the matter can and no doubt will be considered by the commission.


[Stage Direction]
Section agreed to.
Sections 3 to 7 inclusive agreed to.
On section 8-Fishing, etc., in territorial or convention waters in closed season.
William Lyon Mackenzie King: There is a small amendment to section 8.
Mr. LAPOINTE (Quebec East) I move:
That clause 8 be amended by adding the words "in contravention of any provision of this act, or of any regulation" immediately after the word "Canada" in the third line thereof, and by adding the same words immediately after the word "waters" in the last line thereof.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
On section 9-Orders and regulations by governor in council.
Mr. NEILL:: I assume that this is the clause on which the Prime Minister relies in connection with the statement he made on the second reading of the resolution, when I raised a question of other powers coming in and depleting these waters regardless of this convention. The Prime Minister said that that would be taken care of in the bill, but I would point out that section 9, subsection 3,
and possibly subsections 5 and 6, merely prevent-which indeed is all we can do-our own nationals from operating in these waters or any exterior waters, and prevent foreign nations from making use of our harbours and territorial waters, and of course we have that power. But neither in that section nor anywhere else in the bill is there any provision, nor do I see how it can be arrived at by any measure of restriction under this bill, to prevent, say, Norway and Britain from sending around a halibut steamer equipped to stay away from home for six, eight or nine months, and thoroughly cleaning out these banks, because those people know where they are, and they could stay there till they had made a clean-up. That would make this treaty and the advantages obtained from it wholly inoperative. The suggestion I made at an earlier stage of the measure was that we should secure if necessary the signature of Great Britain to the convention, which would then make the convention operative upon all her nationals. While that would not deal with the situation of Japan or of Norway, it would at least guarantee that no British nationals would come there and clean out our fishing. As I said before, in the treaty which was passed in 1923 the United States made a provision of that kind, for different reasons of course, and did, I think, obtain the signature of Britain or an understanding that Britain would bind herself to the terms of the convention of that time. I do not think that was done in 1930, and apparently it is not proposed that it be done here. I should like to hear the Prime Minister's views on that phase of the subject.


William Lyon Mackenzie King: I might say to my hon. friend that in 1923 the senate did make a reservation to the effect-


Alan Webster Neill: The United States senate?


William Lyon Mackenzie King: The United States senate, yes, that the convention should not bind until Great Britain became a party to it. That, I understand, was because the United States senate were under the impression that as between the two countries, Canada had not full authority to sign a convention on her own account. The reservation was withdrawn in the following year and as a matter of fact has never been part of the convention. In 1930, as my hon. friend has indicated, it did not appear. It has been thought inadvisable to single out Great Britain for the purposes mentioned by my hon. friend. We believe that the act as drawn will include all countries in so far as it is possible for us to include them. It does not single out Great Britain, but applies to all countries in a provision that is aimed at
Halibut Fishery

preventing any country from participating, contrary to regulations, in deep sea fishing to the disadvantage of the parties to the convention. What my hon. friend has in mind could, I believe, be accomplished only by some form of world convention. It would only be by agreement of all nations that one could possibly hope to get them to undertake not to fish in deep sea waters beyond territorial limits, and it is questionable, even though you had such a universally applicable provision, if it could be enforced.


Thomas Reid: May I point out, with reference to this section, something that may arise in the future? It is true that the United States have closed their ports and that this is along the lines of the United States treaty as signed by them; but while it is very desirable I am in some doubt whether it may not conflict with the shipping act. Under the shipping act British ships must have free entry to all ports, and if when a British ship was fishing off our coast this provision were applied, prohibiting it from the use of our ports, I fear that considerable trouble would result.


Alan Webster Neill: I would point out that the understanding attached to the convention of 1923 reads:-
. . . subject to the understanding, which is hereby made a part of this resolution of ratification, that none of the nationals and inhabitants and vessels and boats of any other part of Great Britain shall engage in halibut fishing contrary to any of the provisions of this treaty.
It was not apparently because of fear that our treaty-signing powers were not sufficient without the consent of Britain that they specifically put in that clause. They were quite satisfied with Canada's signature provided it was understood that Britain's nationals in addition to ours would be bound. While it is true, as the Prime Minister says, that it is almost impossible to achieve a total prohibition of fishing in the open sea, unless with an international treaty, at least it would remove a very formidable competitor if we secured the adherence of Great Britain. That country engages very largely in halibut fishing; it sends out boats, equipped for long voyages, which stay in northern waters for long periods, so that they have all the facilities at hand to come down here now. If we can eliminate their competition something substantial will have been done towards accomplishing what we want to achieve through this convention.


William Lyon Mackenzie King: It is hoped that competition will be eliminated under the clause as it stands.


Richard Bedford Bennett: This is a convention
between the United States and Canada only. The United States senate did suggest the adding of an understanding which would have the effect of binding Great Britain by a treaty made with this dominion, but they abandoned it because obviously it was absurd that a treaty made between Canada and the United States should impose a condition by which Great Britain should be bound. We could no more regulate deep sea fishing of halibut off the shores of the United States than we can off the banks of Newfoundland unless Great Britain, Norway and Japan became parties, in much the same way as the sealing convention was negotiated for the purpose of preventing the destruction of seals. We certainly cannot do more than we have done here. We have bound our nationals and the United States have bound theirs, and that is all that we can do.


Alan Webster Neill: Nevertheless, Britain was
bound for seven years. It formed a part of the understanding and was accepted by Great Britain.


Richard Bedford Bennett: It was accepted, yes.


[Stage Direction]
Section agreed to.
Sections 10 and 11 agreed to.
On section 12-Vessel, etc., liable to seizure and forfeiture.
Thomas Reid: This convention is between
the United States and Canada but subsection 1 provides:
Every ship, vessel or boat, including all furniture, apparel, appliances . . .
While it may be inferred that "every vessel" means every vessel of either the United States or Canada, the term might be otherwise interpreted.


Richard Bedford Bennett: Every vessel under this
act.


[Stage Direction]
Section agreed to.
Sections 13 to 15 inclusive agreed to.
On section 16-Commencement and duration of act.
Alan Webster Neill: Was there not to be some
provision in this bill to allow the sale of halibut caught in connection with other fishing? Hitherto these fish had to be destroyed or handed to a customs officer, and it was intended that the fishermen should be allowed to sell them, provided it was under conditions and in numbers that indicated that there was no attempt fraudulently to evade the measure.

Royal Canadian Mounted Police


William Lyon Mackenzie King: What my hon. friend has in mind is provided for in the last clause of the second paragraph of article I:
. . . and to permit, limit, regulate and prohibit in any area or at any time when fishing for halibut is prohibited, the taking, retention and landing of halibut caught incidentally to fishing for other species of fish, and the possession during such fishing of halibut of any origin.
That covers the point.


[Stage Direction]
Section agreed to.
Richard Bedford Bennett: As I read the bill, it does no more than give the effect of legislative sanction by this parliament to the provisions of the treaty.


William Lyon Mackenzie King: That is it.


Richard Bedford Bennett: I just wanted to be
clear in my own mind.
Bill reported, read the third time and passed. ROYAL CANADIAN MOUNTED POLICE



PROVISION FOR RESERVE CONSTABLES AND NON-COM MISSIONED OFFICERS

[Stage Direction]
Hon. ERNEST LAPOINTE (Minister of Justice) moved the second reading of Bill No. 83. to amend the Royal Canadian Mounted Police Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Definitions.
Richard Bedford Bennett: Does this section change the existing law?


Ernest Lapointe: It rather clarifies it. Acting rank is not included when service is computed.


Richard Bedford Bennett: The minister knows that there is a case pending of a surgeon who was with the force all his life but who engaged in other activities; he was a coroner engaged in private practice. I believe it was held that because of the definition in the section he was not eligible for pension although he strenuously contended that he was, and that he should be given such recognition as would be given to one who was a permanent appointee. I will not mention the name but the minister knows whom I mean. I should like to know whether there is any change that will affect his position, because he still contends that he is entitled to consideration.


Ernest Lapointe: I am informed this is merely to clarify the meaning of the section.


[Stage Direction]
Section agreed to.
Sections 2 to 4 inclusive agreed to.
On section 5-Status after ceasing to be constable.
Richard Bedford Bennett: I want to be clear as to whether or not this involves any immediate payment of money in connection with the reserves.


Ernest Lapointe: This
section is being amended after correspondence with the Department of Finance. It is merely to place those members retiring on pension on the same basis as others who leave the force, giving them the privilege of withdrawing as an annuity to widow or dependents the amount that has been paid in. At present when a man retires on pension his dependents are entitled to a pension proportionate to the time of his service, but they cannot continue contributing or withdraw the entire amount as in the case of those whose services terminate otherwise. This has been studied in respect to actuarial principles, and the Department of Insurance is agreeable.


Richard Bedford Bennett: But no pay attaches to the reserve men until such time as they are actually called up for training or duty?


Ernest Lapointe: There is no doubt about that. That is clause 2. I was discussing the last clause.


Mr. MASSEY:: Is the clause to be retroactive?


Ernest Lapointe: No.


Mr. COLDWELL:: Has the minister had an opportunity to look into the matter I mentioned last Monday, the secret service?


Ernest Lapointe: My hon. friend knows how busy we have been. I promise him I will consider it.
Mr. UOLI) \\ ELL: I should like to add another fact. The man to whom I referred, Sergeant Leopold, was actually arrested while leading a demonstration or a riot in Toronto in front of the American consulate some ten years ago, and was found guilty and fined $50.


Ernest Lapointe: While he was a member of the force?


Major James William Coldwell: While he was a member of the force, one of four ringleaders arrested. I am adding that fact to the protest I made last week, because I do not think that is conduct becoming to a secret service officer.


Abraham Albert Heaps: I may point out that to my knowledge the same class of work has been done by the mounted police for the last twenty years or so. Evidently it has been part of the work of the service to carry on



Royal Canadian Mounted Police
espionage in all kinds of labour organizations. I think that ought to be stopped. There may be cases where it is necessary for the mounted police to investigate a secret organization, but labour organizations are more or less public and I do not think it is necessary or right to have members of the mounted police spy on what is being done.


Richard Bedford Bennett: I find it difficult to understand the desirability of the government undertaking the business of an insurance company with respect to men in the force. This permits a man leaving the force to continue making payment of instalments.


Ernest Lapointe: They are doing so at the present time, except those who draw pension.


Richard Bedford Bennett: That does not make it right. We are making the Dominion of Canada an insurance company qua the force. If they leave it they may still continue to make payments and receive the amount of their policies, whereas the minister knows the government is making yearly contributions to that fund. This places the men in a preferred position, although they are no longer members of any force. As I said the other day, I find it difficult to accommodate my mind to the fact that we are becoming an insurance company with respect to any number of people, few or many.


Ernest Lapointe: We are already.


Richard Bedford Bennett: I know we are in the superannuation fund. I am talking of this.
Bill reported, read the third time and passed.



GOLD CLAUSE OBLIGATIONS


[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved the second reading of Bill No. 103, respecting gold clause obligations.
He said: Before you leave the chair, Mr. Speaker, in the short discussion on the resolution the leader of the opposition (Mr. Bennett) requested me to make some inquiry regarding the bearing of the colonial stock acts upon this measure. I have made such inquiries and find that the measure is not affected, for the reason that all the outstanding sterling issues of the Dominion of Canada payable in London are on the list of stocks which have complied with the colonial stock acts. All these direct obligations of the Dominion of Canada payable in London are

payable in sterling only. They do not contain the gold clause, and consequently the present gold clause obligations bill does not affect them in any way.
Richard Bedford Bennett: Is there a fixed value of sterling in the bond?


Mr. DUNNING:: No.


Richard Bedford Bennett: Just a plain undertaking to pay pounds sterling?


Charles Avery Dunning: 
Richard Bedford Bennett: Of course he can get it.


Charles Avery Dunning: Well, practically he cannot.


Richard Bedford Bennett: Oh, yes; I can buy gold.


Ernest Lapointe: You cannot export gold without a licence.


Richard Bedford Bennett: On the second reading of this bill, which involves acceptance of its principle, I think it only fair to say that the House of Lords in the case to which reference was made yesterday declared that all the countries have practically adopted this view, the view expressed in what is known in the courts as the Feist case, which however was not followed in the reference to that case in the House of Lords because it was decided that under the terms of the arrangement under which the money was borrowed in the United States it was governed by the law of the state of New York or the United States. As far as this bill undertakes to govern transactions and obligations of the Dominion of Canada expressed in terms of what is known as the gold clause, there is no doubt we are following the example of other nations in enacting the legislation now proposed.
But there are some phases of the measure -for example, that which declares it to be against public policy for parties to provide that obligations may contain a gold clause, which go rather farther than I think can be justified, because they interfere in a sense that I think is not necessary for the purpose of giving effect to this measure, with the contractual rights of parties and their ability and right to make contracts. Unless it be intended that it is to govern only the obligations of the state, to declare that every gold clause obligation is contrary to public policy, and that no such provision should be contained in or made in respect of any obligation, certainly is a departure from the ordinary rules that govern the enactment of legislation of this kind, and might be misunderstood.


Charles Avery Dunning: I will deal with that when we reach the section.


Richard Bedford Bennett: I should like to be perfectly clear that none of our obligations are expressed in terms of current fineness or weight, for instance in connection with sterling obligations. Certainly my memory was that I had seen obligations of the Dominion of Canada, payable in sterling, expressed in terms of the present weight and fineness of 31111-1741
gold. That is not the exact language, but the sense of it was that they were payable in pounds sterling expressed in terms of gold by appropriate language. If the minister tells me that none of our securities contains this clause of course I am quite content, but it was because I believed that some of them did contain it that I brought the matter to his attention yesterday. My memory was that I had seen some of those obligations expressed in those terms, but it is probable that my mind was dealing with what might be called corporate securities rather than the national obligations.
It is also quite clear that none of our guaranteed obligations have found approval under the Colonial Trustee Act. Successive ministers of finance laboured to secure the admission of our securities to that list. Mr. Fielding finally secured it by giving the undertaking I mentioned last evening. I am very glad indeed to hear that none of our national obligations which have been admitted to that list contains any provision that contemplates payment in gold. In any event it would make no difference as far as the enactment of this legislation is concerned; it would be a matter of subsequent negotiation, so there is no reason why the passing of the bill should be delayed.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Sanderson in the chair.
Sections 1 and 2 agreed to.
On section 3-Legal tender when payable in money of Canada.
Richard Bedford Bennett: This raises the issue I mentioned to the minister the other day. That issue was met in Australia by the character of the currency issued, with which the minister no doubt is familiar, which instead of promising to pay something on demand, which involves nothing more than the exchange of pieces of paper, merely says the note is legal tender for the amount in the commonwealth and all territories under the control of the commonwealth. When you use the words "legal tender" in connection with your paper currency this clause has singular value, but as it is now, legal tender is defined by our statute.


Charles Avery Dunning: By our Currency Act.


Richard Bedford Bennett: Yes. We are now declaring that this shall be legal tender, and the statute defines legal tender to mean something other than that. The minister will remember that the Currency Act defines what legal tender is, so much silver, so much copper and
Gold Clause Obligations

so much gold. Now we are going to say that in the case of any gold clause payable in money of Canada the tender of currency of Canada, dollar for dollar, of the nominal or face value of the obligation, shall be a legal tender, and the debtor shall, on making payment in accordance with such a tender, be entitled to a discharge of the obligation.


Charles Avery Dunning: Within Canada.


Richard Bedford Bennett: Quite so. I was wondering whether it would not be desirable to insert the words "notwithstanding the provisions of any act to the contrary " because legal tender has a defined meaning. It means so much silver, so much copper and so much gold, which includes United States gold, Aou see, the legal tender act of this country is one of the few acts that recognize the gold coin of a foreign country. It recognizes the sovereign, of course, which is a British coin, and it also recognizes gold of the United States whether five, ten or twenty dollar gold pieces. I was asking the minister whether or not the words " notwithstanding the provisions of any act to the contrary " should be inserted.


Ernest Lapointe: Those words might be added. They could not do any harm.


Charles Avery Dunning: That is already provided for in section 7, which we have not yet reached. That section provides:
The provisions of this act shall have full force and effect notwithstanding anything contained in any other statute or law.
That is intended to cover this point.


[Stage Direction]
Section agreed to.
Sections 4 and 5 agreed to.
On section 6-Gold clause obligation declared to be contrary to public policy.
Richard Bedford Bennett: I should like the minister to say why he thinks this should be enacted.


Charles Avery Dunning: That, of course, is rather difficult to answer in detail. I am trying to imagine a condition under which gold obligations again accumulate; I am trying to imagine that condition alongside the condition we have in Canada under the present law with relation to gold, and particularly the relation of the individual or the corporation to the supply of gold. The supply of gold is now entirely under government control; no one may export it from the country without an export licence, and as a general matter of public policy the government deems it desirable that contracts to pay money in Canada should be expressed in terms of legal tender in Canada

rather than in terms of gold, which at the present time in the world is in a far different situation from that which prevailed during the years when we were accustomed to regard it as one of the immutable things. If we eliminate by law the making of contracts in terms of gold certainly it will facilitate the taking of any measures by this parliament in the future which may be necessary from time to time, having regard to the international exchange situation. Any measure which facilitates or renders possible the free use of gold under present conditions, disregarding the national necessity or enabling that- national necessity to be overridden because of an individual contract, is in the opinion of the government an undesirable condition.


Richard Bedford Bennett: Well, Mr. Chairman, I protest against this arbitrary exercise of power. In the first place, if one reads the language of the last judgment of the privy council it becomes a nice question whether we have any power at all. Here we are dealing with contracts, not any contract but all kinds of contracts, and we are declaring that as a matter of public policy a citizen of Alberta may not make a contract to pay $100 in gold, if he so pleases. On the construction placed by the House of Lords in the Feist case it was said that under the conditions mentioned this meant the right to tender a sufficient sum of money to buy that gold, without buying it. That is the sense of that judgment, but to say that this parliament is now going to declare all contracts now outstanding which contain this clause to be against public policy is going to hit the credit of this country fairly hard. Every gold clause obligation is hereby declared to be contrary to public policy. At one sweep we are going to wipe out all these contracts. What is to be substituted for them? I must say that not only is it the essence of repudiation, but it is entirely unnecessary. We have gone far enough when we say that in law any contract governed by the law of Canada, which is the essential point, is sufficiently met if we tender to the person who holds it Canadian currency. That discharges it, and he is entitled to a discharge. We also say that in this country, in our own dealings, currency takes the place of metal in all transactions, as legal tender in the discharge of obligations. Then we come to the third point, and we say that all these clauses are now declared to be against public policy-and I can name one after the other of these securities which are outstanding. To repudiate them outright and say they are against public policy is something which we should not do, unless it is absolutely necessary.

Gold Clause Obligations


Charles Avery Dunning: The intention is to deal with future contracts.


Richard Bedford Bennett: It does not say that. It says:
Every gold clause obligation is hereby declared to be contrary to public policy and no such provision shall hereafter be contained in, or made in respect of, any obligation.
It deals with the present and the past- both. Perhaps I am now quite as orthodox as the Minister of National Revenue has become, but it seems to me quite clear that the only medium which we have, and which we can speak of as having universal value, is still gold. Whether we like it or not, that is so. It seems to me there is some doubt about our jurisdiction to declare that all these contracts are against public policy. I can only say that I do not believe it is sound in law.


Charles Avery Dunning: The existing ones certainly are against present public policy.


Richard Bedford Bennett: 
Charles Avery Dunning: We say that he cannot get it, except in bars containing 400 ounces of fine gold. That is our law at the present time.


Richard Bedford Bennett: Yes, I see that.


Charles Avery Dunning: He could not get the gold
to use for payment.


Richard Bedford Bennett: Yes, he could.


Charles Avery Dunning: Well, that is rather farfetched.


Richard Bedford Bennett: Yes-but he could. The mines are not bound to sell their gold to the crown.


Charles Avery Dunning: It is decidedly to their interest to do so.


Richard Bedford Bennett: That is so.


Charles Avery Dunning: They cannot export it.


Richard Bedford Bennett: Correct, and a licence can be given only to a chartered bank or the Bank of Canada, and therefore the export of it involves a licence issued practically by the crown. But that does not say you cannot get gold. But I am dealing with the other side of the matter. I am dealing with a position where parliament steps in in connection with any contract which two men may make to pay something in gold, if they are foolish enough to do it-in other words, we are going to protect them against their own foolishness-and says that it is against public policy. If the judgment of the privy council is any guide, it certainly affects property and civil rights, and affects them in such a way as to make illegal and invalid a contract made between two citizens, which certainly is not a general principle which should govern in connection with contracts.


Ernest Lapointe: Mr. Chairman, as to the principle of declaring that it is against public policy we must remember that in these matters we have to consider what is done in other countries. The international aspect of the matter is very important. This clause is exactly the same as one enacted by the congress of the United States.


Richard Bedford Bennett: I know that, but I did not wish to mention it.


Ernest Lapointe: It was enacted in 1933. They declared all gold clauses to be against public policy, provided against such obligations in the future, and made provision whereby such obligation.1 would be discharged by payment dollar fo' dollar in legal tender. It was that legislation, supported by the House of Lords iu the International Trustee case, which indicated what the British government was really owing in New York. So far as our power today is concerned, may I point out that the Supreme Court of the United States decided that that legislation was valid because it was in relation to the monetary system of the United States, which is the case in Canada. The Department of Justice has declared this to be valid because parliament has certain powers of legislation, with respect to (1) the regulation of trade and commerce; (2) currency and coinage; (3) banking, the incorporation of banks and the issue of paper money; (4) savings banks; (5) bills of exchange and promissory notes and (6) legal tender-apart, of course, from the power to legislate for the peace, order and good government of the country. Thereby this parliament is given ample power to legislate.
Trans-Canada Air Lines


Richard Bedford Bennett: I respectfully differ from the minister, because positions in the United States and Canada are very different.


[Stage Direction]
Section agreed to.
Section 7 agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. ERNEST LAPOINTE (Minister of Justice) moved the second reading of and concurrence in amendment made by the senate to Bill No. 23, respecting foreign enlistment.
He said:The only amendment made by the senate was the addition of one word in section 3. Section 3 reads:
If any person without a permit, being a Canadian national, within or without Canada, accepts or agrees to accept any commission or engagement . . .
And they have added the word "voluntarily" before the word "accepts." It will now read:
If any person without a permit, being a Canadian National, within or without Canada, voluntarily accepts . . .
And so on. I have no objection to the amendment.
Richard Bedford Bennett: It is difficult to understand how it could be accepted otherwise.


Ernest Lapointe: I agree,
but the point is not sufficiently important to start a battle with the senate.
Motion agreed to; amendment read the second time and concurred in.



TRANS-CANADA AIR LINES CONCURRENCE IN SENATE AMENDMENTS

[Stage Direction]
Hon. C. D. HOWE (Minister of Transport) moved the second reading of and concurrence in amendments made by the senate to Bill No. 74, to establish a corporation to be known as Trans-Canada Air Lines.
Richard Bedford Bennett: What are the amendments?


Mr. HOWE:: Several changes have been
made [DOT] in the bill, only one of which is important. The title has been changed. Instead of its being "an act to establish a corporation to be known as Trans-Canada Air Lines" it has been changed to read "an act to incorporate Trans-Canada Air Lines." Then in connection with the directors being resident in this country the word "continuously" has been added, as intended by this chamber.


Richard Bedford Bennett: That was agreed to.


Clarence Decatur Howe: The number of directors has
been changed from nine to seven, three of whom are to be appointed by the governor in council and four by the shareholders of the corporation.


Richard Bedford Bennett: That is unimportant, I
take it.


Clarence Decatur Howe: I do not think it is material. Then the word "purchasing" has been changed to "acquiring," and the word "hereafter" has been changed to "hereinafter."
Motion agreed to; amendments read the second time and concurred in.



DEPARTMENT OF TRANSPORT


[Stage Direction]
Hon. C. D. HOWE (Minister of Transport) moved the second reading of and concurrence in amendments made by the senate to Bill No. 88, respecting Department of Transport stores.
He said: The only change in this bill is the rewording of section 3. The objection taken in the senate was that this section is worded in accountant's language and they have now expressed it in legal phraseology.
Richard Bedford Bennett: What the minister might describe as high-powered lawyers' words.
Motion agreed to; amendments read the second time and concurred in.



FEEDING STUFFS


[Stage Direction]
Hon. J. G. GARDINER (Minister of Agriculture) moved that the house go into committee on Bill No. 64, to control and regulate the sale of feeding stuffs.
Motion agreed to and the house went into committee, Mr. Sanderson in the chair.
Section 1 agreed to.
On section 2-Definitions.
Richard Bedford Bennett: Is there any change in the existing law made by this section?


Mr. GARDINER:: There are some slight changes in the definitions, but I may say that these have all been submitted to all branches of the trade interested. They were submitted also to producers' organizations and then this house submitted them to the agriculture committee. They have been gone over very carefully and I think they should meet with the approval of this committee.

Feeding Stuffs


Mr. SPENCE:: I do not think so, but of course it will go through just the same.


[Stage Direction]
Section agreed to.
Sections 3 and 4 agreed to.
On section 5-Labelling of package.
Thomas Reid: Would this section cover the sale of canned horse meat?


James Garfield Gardiner: One of the reasons for amending the act is to bring within the provisions of the act other foods that have come into use since 1921.


Mr. STEWART:: When the bill was up for second reading the question was raised, I think by my right hon. leader, as to whether section 4 in its entirety was within the jurisdiction of this parliament. I think the minister said that the wording of this section was much the same as the wording in the old act, but the decision of the privy council in connection with the Natural Products Marketing Act would seem to throw some doubt upon some of the provisions of this section. It reads:
No feeding stuff mentioned in column one of schedule "A" to this act shall be imported into, manufactured, distributed, advertised, sold or offered or held in possession for sale in Canada which has not first been registered with and had a registration number assigned to it by the minister.
Has any consideration been given to the question raised on the second reading of the bill?


James Garfield Gardiner: After this question was raised on the second reading I had the bill submitted again to the Justice department. They prepared a memo indicating that the bill was intra vires on grounds agreeing with the findings that have been made in connection with similar matters, some of which had gone to the privy council. As I recall it, the point upon which they based their decision was the fact that this parliament has a right to legislate in connection with all matters having to do with the control of agriculture. It will be noted that towards the end of the section which has just been read there are these words, "which has not first been registered with and had a registration number assigned to it by the minister." It is the opinion of the Department of Justice that the bill is absolutely within the powers which this parliament has in connection with legislation affecting matters of the kind.


Richard Bedford Bennett: You will remember the privy council said that the marketing act was bad because it interfered with sales within the provinces. I directed attention only to
the words " sold or offered or held in possession for sale in Canada." I did so because of the provisions of section 95 of the British North America Act which deals with the jurisdiction of the dominion and the provinces with respect to agriculture and immigration. That section reads in part:
-and any law of the legislature of a province relative to agriculture or to immigration shall have effect in and for the province as long and as far only ae it is not repugnant to any act of the parliament of Canada.
I am afraid agriculture does not cover the sale of agricultural products. However, the minister is bound by the opinion of his officers and that is the end of it. I am bound to say that the courts in Ontario held against this view in connection with eggs. A dominion statute was held invalid as applying to the sale of standardized eggs as distinguished from eggs in export and interprovincial business.


[Stage Direction]
Section agreed to.
Sections 6 and 7 agreed to.
On section 8-Feeding stuff not to contain excess of certain foreign matter.
Richard Bedford Bennett: It sems to me that by some of these sections we are opening up possibilities of legislation. We are placing upon the minister the responsibility of acting as a judge to determine whether or not a brand is likely to deceive a purchaser in any way as compared with some other brand, or whether in the opinion of the minister they are identical. The minister is now asked to act as referee for the purpose of deciding what very often is a most complex question of law, and which in the case of, for instance, Bayer's aspirin involved litigation that extended over many years.


Charles Avery Dunning: Has it been concluded?


Richard Bedford Bennett: I think so; it finally went to the privy council. The question of determining that issue as raised in section 4 of this act is one which is engaging the attention of the courts, I should think, every week of the year, both in Great Britain and here. For instance one might mention the litigation in connection with Uneeda Biscuit, as well as other articles-sardines, for instance.


Charles Avery Dunning: Bovril.


Richard Bedford Bennett: Bovril, aspirin and so on. I think it will be found that in operation the section will create great difficulties for whoever is charged with the responsibility. In the nature of things no minister can determine an issue of that kind, which in the end
Feeding Stuffs

is usually decided by reference to evidence as to conflict and to misunderstandings regarding meanings. I will do no more than direct attention to that point.


[Stage Direction]
Section agreed to.
On section 9-Inspectors, analysts.
James Garfield Gardiner: When we were on the second reading the question was raised, I believe by the hon. member for Leeds (Mr. Stewart) whether this section gives the minister power to make appointments. I think a careful reading of the section will indicate that it does not.
Such inspectors and analysts may be appointed as the minister may consider necessary for the effective carrying out of the provisions of this act.
That is, the minister has no power to make appointments, but he has the power to have appointments made, and these will be made by the civil service commission. No power is given by the act to the minister to make these appointments.


Hugh Alexander Stewart: This section as drafted calls attention to the provisions of the section in the former act which reads as follows:
There may be appointed in the manner authorized by law such inspectors and analysts as may be necessary for the purpose of this act.
That makes it perfectly clear that appointments would be made under the provisions of the Civil Service Act. I would refer the minister, if I may, to the bill following this one, which is similar to the measure we are now dealing with, the title being "An act respecting the testing, inspection and sale of seeds." Section 4 of that bill provides:
There may be appointed in the manner authorized by law such inspectors and official analysts as are necessary for the purpose of this act.
It seems to me that it would be well to have the wording of this section in the language of the section I have read rather than in its present form, which I think leaves it open to doubt whether the appointments are to be made by the minister, or by the civil service commission in the manner authorized by law. I firmly believe in the merit system, and in the administration of an act of this kind, which has such broad and sweeping provisions, it would be well that the officials responsible for administration should be appointed under the Civil Service Act, that their tenure of office should be secure, and that there should not be any suspicion that they were holding their, offices for political reasons or through patronage. The minister would be well advised to adhere to the wording which has been adopted, and which is used in the bill to which

I have referred. Why is this section of the bill under consideration worded as it is when the other wording seems so well established, is found in so many acts, and leaves the matter beyond question?


James Garfield Gardiner: As I said on the second reading, no change was made in the wording with regard to appointments. As far as -this bill is concerned this is a new clause, the suggestion for which comes entirely from the officials of the department. My first impression when the hon. member brought up the matter before was that I would have this section removed, because it was certainly my intention not to assert any such power as it seemed to give me, but in the department it was drawn to my attention that the wording did not mean that. In fact the wording is in many -acts which have been passed by the house

Such inspectors and analysts may be appointed as the minister may consider necessary.


Charles Hazlitt Cahan: By whom?


James Garfield Gardiner: I have no power to make appointments.


Charles Hazlitt Cahan: By whom?


James Garfield Gardiner: By the civil service commission. That is the wording which in -many acts gives the civil service commission power to make appointments.


Charles Hazlitt Cahan: But there is no general act which compels appointment through the civil service, so far as I know, and there are no appointments necessarily made through the civil service except when they are to be appointed according to the law. These officials may be appointed in any way the minister may desire, by himself or by his servants.


James Garfield Gardiner: They tell me that is not so.


Charles Hazlitt Cahan: Why not make it clear?


James Garfield Gardiner: I am quite satisfied to make it clear if it can be made any clearer.


Richard Bedford Bennett: I suggest that the minister remove any anxiety on the point by using the same language that is used under similar circumstances m other acts-" There may be appointed in the manner authorized by law such inspectors and analysts as the minister may consider necessary for the purpose of this act."


James Garfield Gardiner: I have no objection to that, but I say again to hon. members that I personally made that suggestion, and the draftsman told me that this section does give

Feeding Stuffs
the civil service commission power to make appointments. There was no intention to make it otherwise, and if there is any other wording which is better, I have no objection.


Charles Hazlitt Cahan: If that is the minister's intention, I think he should make the intention clear.


Hugh Alexander Stewart: I have drafted an amendment which possibly the minister will accept and ask somebody to move:
That section 9 be struck out and the following substituted therefor:
There may be appointed in the manner authorized by law such inspectors and analysts as the minister may consider necessary for the effective carrying out of the provisions of this act.


Ian Alistair Mackenzie: I move accordingly.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
On section 10-Inspector may enter premises and take samples.
Richard Bedford Bennett: I am sure the minister will regard this section as such an invasion of civil rights as to challenge the good will of everyone in this chamber. It is provided that:-
An inspector may at all reasonable times enter any premises in which he has reasonable cause to believe any feeding stuff is being or has been prepared for sale and may take for analysis samples of any feeding stuff there found on payment of the value of such samples.
Surely civil rights have not entirely disappeared from the country. I admit that under the present administration they are having a hard time.


Ian Alistair Mackenzie: This is similar to the old section.


Richard Bedford Bennett: I cannot help that. Many things have been put through without regard to conditions. It is desirable that when an inspector has reasonable cause to believe that something improper is being done he should have the powers of a peace officer or a constable. But to say that, without regard to any consideration, an inspector may walk into my premises, break locks, and do anything he likes, provided he pays for any samples he takes-well, I will not take up the time of the committee reading again what I quoted the other day from the criminal code with respect to search warrants and matters of that kind. Neither the minister nor the department is wholly to blame for this section, because such sections have been embodied in our statutes before. But there is
no reason why we should continue to enact provisions of this sort. How would the minister like, if he were engaged in. the business of selling feeding stuffs, to return from dinner and find that somebody had forced an entry into his place of business and taken away samples of what he had to sell, when that person could decently have come and asked for such samples and paid for them? All that is necessary here is to say that the inspector shall be entitled to samples on request ; because if he does not get the samples the licence can be cancelled. The section should read: "An inspector shall on request be entitled to take for analysis samples of any feeding stuff which is being or has been prepared for sale, and pay for such samples." At this time of the session I will only point out the direction in which we are going in this invasion of public rights and civil liberties. If I were in Saskatchewan and asked the minister whether or not I might go into a store and get samples he would say: Certainly; the law ought to provide that the proprietor shall furnish samples on request, and failure to do so should constitute an offence under the act, whereby he would lose his licence. It is proper to say that the samples shall be paid for; but to say that an inspector may enter premises at all times, without limitation on entry, is going altogether too far. It may be said that I am putting an extreme case, but it is the principle that is involved that I am pointing out to the minister. However, I will not trespass any longer on the time of the committee.


James Garfield Gardiner: The section is practically the same as the one that has been in the act since 1921. I believe I am right in saying that most of the manufacturers of feeding stuffs were represented before the committee by a representative of the trade, and they have no objection to the section in its present form; as a matter of fact they rather asked for it. This bill is not objected to at all by the trade; it is one that they themselves helped to draft and they prefer to have it in this form. Occasionally someone about whom there may be question starts up in the business and it is thought desirable that an inspector should go and take samples in the way here proposed.


Richard Bedford Bennett: The section which this one replaces is entirely different in essential meaning. Section 15 of the present act reads:
15. Any officer or person charged with the enforcement of this act shall have access
(a) to any elevator, warehouse or other premises where he has reason to believe that grains or other constituent parts of feeding stuffs are blended for the manufacture of feeding stuffs; and
Feeding Stuffs

(b) to any premises or receptacles which he has reason to believe contains feeding stuff.
2. Such officer or person may take the samples therefrom on payment of the value of such samples.
In essential meaning that section and the one now before us are entirely different. One says that any officer or person charged with the enforcement of the act shall have access, and so on.


Ian Alistair Mackenzie: The
definition of inspector is exactly the same.
Mr.. BENNETT: I am not arguing that narrow point; the person charged with the enforcement of the act means the inspector. There is no doubt about that. What I am pointing out, however, is that essentially the two sections as worded are different. Section 10 of the bill is carrying the doctrine of right sf search beyond the limit. Certainly section 15 of the act, which is now being replaced, is not as broad as the present provision.


The CHAIRMAN:: Shall the section carry?


Richard Bedford Bennett: On division.
Section agreed to on division.
On section 11-Particular offences. Penalty.


Richard Bedford Bennett: The fine here is incongruous having regard to what we provided the other day in connection with war materials and the like. Lack of uniformity in fines is a matter to which judicial attention has been much directed in recent years, and it is only necessary to point it out.


[Stage Direction]
Section agreed to.
Sections 12 and 13 agreed to.
On section 14-Regulations.
Richard Bedford Bennett: Section 14 leaves the last word with the governor in council. I wonder why these imitators have gone so far in outdoing their predecessors. The governor in council is now authorized to vary any schedule to this act, which means that the whole essence of the bill now rests in the hands of the governor in council. The schedule contains a list of feeding stuffs that are to be dealt with, and now we wind up by conferring upon the governor in council power to vary the schedules. My hon. friends are certainly making great progress in improving on the exercise of the arbitrary powers of their predecessors.


Mr. JACOBS:: It is a case of evil communications corrupting good manners.


Richard Bedford Bennett: But there was no communication; that is the trouble. This section is entirely new. It shows what effect the bad

example of five years has had on the permanent officials of the department, for here we are going to clothe them with power to change the whole act, and we are going to give the minister power to make regulations. In other words, between the governor in council and the regulations, all that is necessary is to pass the title of the bill and these sections with regard to regulations.


Charles Avery Dunning: But section 5 limits the content of the regulations.


Richard Bedford Bennett: But it does not; that is the point. The minister now grasps the point I was endeavouring to make. Section 5 makes provision with regard to labels and things of that sort, and in section 14 we are providing that the governor in council may from time to time make regulations varying any schedule to the act, while in section 15 the minister is empowered to make regulations respecting the feeding stuffs enumerated in that section.


Charles Avery Dunning: Yes; but if section 5 is read carefully it will be found to be a complete limitation on the minister's part.


Richard Bedford Bennett: Section 5 reads:
Every package containing any feeding stuff mentioned in column 1 of schedule "A" to this act shall be labelled in such manner as may from time to time by regulation be prescribed.
Then we wind up, after thirteen sections, with a section providing that the governor in council may from time to time make regulations to vary any schedule, and that is followed by a section empowering the minister to make from time to time regulations covering everything that is embraced in the legislation, registration, labelling, information to purchasers, procuring and analysis of samples, analysis for purchasers, and so on. Imagine the power!


Charles Avery Dunning: Surely that is not the meaning. The schedule is descriptive.


Richard Bedford Bennett: I am looking at sections 14 and 15. Section 15 gives power to deal with all the matters about which we have been endeavouring to legislate, and says that the regulations made under this act are to be law. In the days of the old administration, according to the theories then expressed, it was said to be pretty bad that the governor in council made laws, but now the Minister of Agriculture alone is going to make the laws of this country. So that whatever Herod may have done, the government has now out-Heroded Herod. I think upon reflection the minister will see that this is going further than we have usually gone in this parliament. I can hardly conceive of any government asking us to agree to a section which

Feeding 'Stuffs
creates a new law-making power in this country, namely, one man. In the language of the hon. member for Spadina you not merely "See" the late government but "raise" them, by giving power entirely to the minister to make the regulations.


Charles Hazlitt Cahan: We should meet one day at the opening of each session and pass an act allowing the governor in council to do anything within the legislative competence of parliament, and then prorogue.


Charles Avery Dunning: That was advocated during the previous five years.


Richard Bedford Bennett: No, it was not advocated. This, in the language of the hon. member for Vancouver Centre (Mr. Mackenzie) is responsible government. His sense of responsible government needs revision.


Mr. DOUGLAS:: I presume these changes and regulations from time to time will be printed in the Canada Gazette. Will any other form of publicity be given? In view of the fact that an offence under the act is fairly serious it seems to me something should be done to make known any changes in the regulations from time to time. The average farmer or even the man in the feed business is not always familiar with the Canada Gazette.


Samuel William Jacobs: The statutes will be published.


Thomas Clement (Tommy) Douglas: But the regulations will not.


James Garfield Gardiner: As I have already said, all these sections that have been introduced into the act have been introduced after full discussion with practically all parties concerned, that is, all the manufacturers of these feedstuffs. There is no doubt that every manufacturer in Canada will have the regulations at his hand at all times, because he will be more or less governed by them in the making of his feeds. To that extent they will be advertised at all times. I do not see any objection to removing (a) from clause 14, "varying any schedule to this act," and have them subject to coming back here for change any time change has to be made. I think once a year would be sufficiently often to consider changes in the schedules.


Richard Bedford Bennett: I should think the minister himself would desire to have it out.


James Garfield Gardiner: I would just as soon have it out. I suggest that the clause carry with subsection (a) deleted.


Ian Alistair Mackenzie: I move accordingly.


Charles Avery Dunning: That restores responsible government!


Richard Bedford Bennett: No, responsible government is still done away with by section 15.
Amendment agreed o.


Charles Hazlitt Cahan: If you strike out clause (a)
the others must be relettered.


Frederick George Sanderson: That will be done.
Section as amended agreed to.
On section 15-Regulations.


Richard Bedford Bennett: Section 15 is the more
offensive of the two.


Charles Avery Dunning: Surely my right hon.
friend will let the minister define what is a weed.


Richard Bedford Bennett: We enact legislation, and then we say the minister may make regulations under (a) to (k); we give him the power by regulation to deal with all the things that we as a parliament dealt with. Take them one by one: (a) registration of feeding stuffs; we have a law about that-we have passed the section. Now the minister is to have power to make regulations-


Charles Avery Dunning: Subject to the section,
of course.


Richard Bedford Bennett: No, it says these regulations have the force of law.


Charles Avery Dunning: Not if they are contrary to the section.


Richard Bedford Bennett: But we do not impose
any limitation; that is my point. Having as a parliament passed the section we wind up by saying that the minister may make regulations about all the matters that we were legislating on, and these regulations are to have the force of law. Why not have some responsible government?


Hugh Alexander Stewart: In the old days it was
a well established principle that the words "not inconsistent with the provisions of this act" should be included, but even that safeguard has been wiped out. This is wide open, a blank cheque.


Richard Bedford Bennett: This may sound unimportant. If the minister will add between the words "regulations" and "respecting" the words "not inconsistent with the provisions of this act," the point made by the Minister of Finance will be clear. As it stands now the minister may do anything.


James Garfield Gardiner: The only objection I
have to those words is the one I have raised on one or two occasions I am somewhat
Feeding Stuffs

like the Minister of Transport; I do not like to get into conflict with the legal authorities on questions of this kind. I can assure my right hon. friend that no such intention as he ascribed was intended in the drafting of the bill. Clause 3 of the old act gives almost identical powers in very much the same language:
The minister may
(a) appoint an advisory board which may at his request prepare and recommend to him such regulations-
And so on, make regulations establishing standards, designating the kind of damaged grain, et cetera, which is considered injurious; in fact giving practically all the powers of this section.


Charles Avery Dunning: Look at subsection (k)
and you will see the point-"any other matter in regard to which he is by this act required or authorized to prescribe."


James Garfield Gardiner: Exactly the same as in the old act-make regulations for any other purpose deemed by him to be necessary for carrying out the provisions of the act.


Richard Bedford Bennett: The words "not inconsistent with the provisions of this act" are not here now.


James Garfield Gardiner: They are in the
other act.


Charles Hazlitt Cahan: Why cite to us something
done seventeen years ago? Section 14 (f) gives the minister power to make regulations "with respect to any other matter concerning which he may deem regulation necessary for the execution of the purposes of this act." That implies that regulations may be made under clauses (a) to (e) which are not consistent with the act. Exactly the same criticism applies to section 15. The minister would have all the authority he could possibly desire if he or the governor in council were authorized from time to time to make regulations not inconsistent with the provisions of this act.


James Garfield Gardiner: Well, Mr. Chairman, I can only say that I am. sufficiently conservative, if you like to put it that way, to think it is a good thing to continue those things that have worked all right for twenty years. In connection with this provision, no trouble having arisen, I do not see any reason for changing the wording. Again I would say that the matter has been submitted to the best legal authorities we have in the department.


Charles Hazlitt Cahan: Who were the legal authorities that approved of this?


James Garfield Gardiner: The officials of the Department of Justice, as represented in the different departments.


Charles Hazlitt Cahan: Well, an official of the Department of Justice is not the head of this department. The bills brought in last year and this year have been unprecedented with respect to the confused way in which the clauses are expressed. The minister says that because of some precedent which has been established he wishes to go back and make regulations which are inconsistent with the provisions of this act. He should have no such authority. If regulations were so made in the past it would have been disclosed very quickly upon contestation that such regulations might be infringed upon without penalty. Why raise all these difficulties when you can express clearly in the English language what is intended? Whatever may be in the mind of the minister, this parliament in passing these sections should insist that the regulations to be made either by the governor in council or by the minister should be consistent with the provisions of this act.


Hugh Alexander Stewart: What is the objection of the minister to using the standard words "not inconsistent with the provisions of this act?" Surely he does not think he should have authority to make regulations that are inconsistent with the act?


James Garfield Gardiner: I think that is exactly what it means, and I would prefer to let the draftsmen of these acts put in the proper wording rather than try to do it in this committee on the spur of the moment. My experience has always been that it is better to make laws in that way. I have no objection to those words, but at the moment I am not certain in imy own mind as to what would be the effect on these sections if they were inserted.


Charles Hazlitt Cahan: Then I think the section might be held over until the deputy minister of justice has time to report on it. It is not sufficient excuse for parliament to pass an act of this kind, prescribing penalties, which may be imposed by information or by indictment, to say that some unknown and nondescript official in a department has inserted or left out certain words. Let us get down to a clear expression of what is intended.


James Garfield Gardiner: As a matter of fact the rewording of the act has resulted in what, was formerly paragraph (a) being taken out of the section under which these regulations are made possible.


Richard Bedford Bennett: That is still in the bill.

Feeding Stuffs


James Garfield Gardiner: It is now section 23, and
it reads:
Tlie minister may appoint an advisory board which may, at his request, recommend to him such regulations as in its opinion should be established under this act.


Richard Bedford Bennett: But the minister sees what that means.


James Garfield Gardiner: It simply means that a board is established composed of representatives of all branches of the trade as well as representatives of the producers. Any regulations the minister may desire to have become effective under this act are submitted to this board first for review and discussion before they are put into effect.


Richard Bedford Bennett: Surely the minister sees the effect of that'. The advisory board then becomes the House of Commons and the senate and the governor general. It becomes the law making body; it makes a recommendation to the minister; he passes regulations, and under section 15 'he becomes a one man parliament. I am not saying anything about the minister personally, but that is what happens. If the Minister of Finance would just look at paragraph (j) he would see my point quite clearly. Section 21 provides for the disposal of feeding stuff not conforming to the act; it may be forfeited to his majesty, and so on. Section 15, paragraph (j), says the minister may make regulations respecting the disposition of damaged feeding stuff. We confer upon him the power to make regulations, though the act has dealt with the matter in detail. The desirability of inserting the well known formula " not inconsistent with the provisions of this act " becomes painfully apparent from looking at those sections, I think.


Ian Alistair Mackenzie: The
draftsman has inserted in the definitions the necessary authority to cover both cases. Under paragraph (j) of section 2 regulation means any regulation made under the authority of this act, so what my right hon. friend desires is absolutely and amply provided for in the interpretation section, both in regard to this point and in regard to the point raised a few moments ago.


Charles Hazlitt Cahan: The minister has made it perfectly clear; that is exactly what we are complaining of. Under the definitions " regulation " means any regulation made under the authority of this act, and as it is now drafted this act gives the minister authority to make any regulations whatsoever, whether or not they are consistent with the provisions of the act. Still those regulations certainly would be
under the act. This bill gives the minister authority to make his own regulations, to have penalties imposed for their breach, all under the act.


Ian Alistair Mackenzie: Well, I do not agree with my hon. friends that it is necessary, but there is no objection in the world to inserting those words. Accordingly I move that the section be amended by inserting after the word " regulations " in line 22 the words " not inconsistent with the provisions of this act."


Richard Bedford Bennett: Would it not be well to insert those words in section 14 also?


Ian Alistair Mackenzie: I have no objection at all.


Richard Bedford Bennett: This is all done under the act, but the regulations need not be consistent with it. That was the whole point we were endeavouring to make, and I am sorry we did not present it more clearly.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Ian Alistair Mackenzie: I move that section 14 be amended by adding after the word " regulations " in line 5 the words " not inconsistent with the provisions of this act."


[Stage Direction]
Amendment agreed to.
Section 16 agreed to.
On section 17-Warranty.
Richard Bedford Bennett: I do not want to take up more time, but surely this section must go beyond the jurisdiction of this parliament. The Sale of Goods Act covers this whole matter, and of course the courts have held that any body that is created, even such bodies as banks, must comply with local laws. Here is the granting of an action for warranty, which concerns purely property and civil rights and the administration of civil justice, being dealt with by this parliament. I have nothing further to say, Mr. Chairman; I merely point out the fact.
Section agreed to on division.
Sections IS to 20 inclusive agreed to.
On section 21-Detention and disposal of feeding stuff not conforming with the act.


Charles Hazlitt Cahan: I suggest that in line thirty-two after the word " regulations '' the words " made thereunder " should be inserted.


Richard Bedford Bennett: Quite.
Feeding Stuffs


Ian Alistair Mackenzie: That is exactly the same point. There is no objection to putting it in, but it is unnecessary.


Charles Hazlitt Cahan: Probably the minister has not had very much experience in contesting legislation of this kind.


Charles Avery Dunning: The word "regulations" is in line twenty-eight; would the change at that point govern the whole section? Would an alteration to that effect meet the views of he hon. member for St. Lawrence-St. George?


Charles Hazlitt Cahan: I think it should be inserted n both places. There could be no harm n adding those words; otherwise lawyers vill be arguing about it in court.


Richard Bedford Bennett: And in the thirty-first line I believe the word "the" at the end of the line should be " this."


James Garfield Gardiner: Yes, that is correct.


Charles Avery Dunning: I move:
That section 21 be amended by striking out the word "the" at the end of line thirty-one and substituting therefor the word "this", and that after the word "regulation" in line thirty-two, the words "made thereunder" be inserted.


Hugh Alexander Stewart: And in the twenty-eighth line.


Charles Avery Dunning: It is clear without that, surely.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 22 and 23 agreed to.
On section 24-Repeal.
Hugh Alexander Stewart: How will section 24 affect section 25? The Feeding Stuffs Act is repealed by section 24, and by section 25 the new act shall not come into force until October 1, 1937.


Richard Bedford Bennett: There is no statute until that date.


James Garfield Gardiner: That is correct.


[Stage Direction]
Section agreed to.
Section 25 agreed to.
On schedule A.
Richard Bedford Bennett: I suppose the schedule has been carefully checked. Some of it is in very fine print and the misprint of a single letter might make some difficulty.


James Garfield Gardiner: It has been done carefully.
Schedule A agreed to.
Schedule B agreed to.
Bill reported.

Mr. DUNNING moved that the bill be read a third time.


Charles Hazlitt Cahan: Before the bill is given a third reading, although I would not suggest a division of the house at this time, I must say we cannot be deemed to have approved of the clauses with respect to which we have taken objection. We will permit the bill to pass without a division, but there must be that understanding.
Motion agreed to and bill read the third time and passed.



REGULATION OF TESTING, INSPECTING, SALE AND IMPORTATION

[Stage Direction]
The house in committee, on Bill No. 65,
respecting the testing, inspection and sale of seeds-Mr. Gardiner-Mr. Sanderson in the chair.
Sections 1 and 2 agreed to.
On section 3-Regulations.
Richard Bedford Bennett: I suggest the same principle should be prescribed in section 3 as in sections 14 and 15 of the measure relating to feeding stuffs. The first part certainly makes that provision, but the latter part does not. There is provision in the first part whereby the minister shall establish regulations under the act, and then it goes on to say "and may make regulations" and so on. The natural inference is that they were not established. I think it might be desirable to use the expression to "make regulations not inconsistent with the provisions of the act prescribing" so and so, if the minister thinks well of it.


James Garfield Gardiner: The wording in section 3 is exactly the same as that in the original act. However, I have no objection to the change in the wording.


Richard Bedford Bennett: There is some difference. The minister has not quite grasped my point. There is provision for the appointment of an advisory board which prepare and recommend such regulations as should be established under the act. And then it proceeds to use the words "may make regulations." The word "thereunder" could be used, so long as it is not inconsistent. I think the situation would be met by adding the usual formula, "not inconsistent with the provisions of the act."


James Garfield Gardiner: I notice the wording is the same as in the old section 3, but of course that is no argument in favour of it.

Seeds


Charles Hazlitt Cahan: To say "regulations not inconsistent with the provisions of this act" is entirely different from saying "regulations made under the provisions of this act." When you give unlimited power to make regulations, the regulations so made may be consistent or not consistent with the provisions of the act though they are made under the act. It is obvious from the wording of section 3 that the minister is not bound by the recommendations of the board. They may recommend regulations but he is not bound to accept their recommendation.


James Garfield Gardiner: We will put that in.


Ian Alistair Mackenzie: I move that after the word "regulations" in line thirty-one of section 3 there be inserted the words "not inconsistent with the provisions of this act."


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
On section 4-Appointments.
Richard Bedford Bennett: The minister will see that the two bills deal with the same thing but not in the same terms. The section in this bill reads:-
There may be appointed in the manner authorized by law such inspectors and official analysts as are necessary for the purposes of this act.
In the other bill the section reads:-
Such inspectors and analysts may be appointed as the minister may consider necessary for the effective carrying out of the provisions of this act.
I suppose it may be taken for granted that the minister Will determine what officials are necessary.


[Stage Direction]
Section agreed to.
Sections 5 to 14 inclusive agreed to.
On section 15-Exemptions.
Thomas Reid: Would the exemption in this section apply only to field seeds and not to such garden seeds as a farmer might use?


James Garfield Gardiner: Sections 5 and 6 of this bill are not to apply to seed of cereal grains, buckwheat, field peas, field beans and corn that are grown, sold and delivered by any farmer, on his own premises, for seeding by the purchaser himself. It is not usual for a farmer to sell garden stuff. As a matter of fact, most of these seeds are imported.


Thomas Reid: Most of the farmers in the Fraser valley have a small acreage and this section would seem to apply to those having large acreages.


[Stage Direction]
Section agreed to.
Section 16 agreed to.
On section 17-Official samples.
Richard Bedford Bennett: If the Minister of Finance is right, this section is redundant. Perhaps it can pass on division.


[Stage Direction]
Section agreed to, on division.
Section 18 agreed to.
On section 19-Detention.
Richard Bedford Bennett: This section certainly goes farther than we have gone heretofore in this parliament. We have not considered advertising as being within our jurisdiction. It may pass, on division.


Charles Hazlitt Cahan: This section could not be enforced if it was contested.


[Stage Direction]
Section agreed to, on division.
On section 20-Prosecution for violation.
Richard Bedford Bennett: As regards the last clause of section 20, I should think it would be very difficult to deal with the prosecution of a person out of Canada. It says:
If, . . . the seeds or plants were purchased from a person not resident in Canada the prosecution shall be taken against the person or his agent in Canada who sold, advertised, offered or had in his possession for sale the said seeds or plants.
That is a new theory of the criminal law.


Charles Avery Dunning: Well, it has been in the law for quite a time.


Richard Bedford Bennett: Wherever it came from, it is a new theory of the criminal law.


James Garfield Gardiner: It has been in the law since 1923, apparently.


Charles Hazlitt Cahan: The old law, if it is correctly printed on the opposite page, had a proviso:
If, however, the seeds or plants were purchased from a person not resident in Canada the complaint made shall be against the person in whose possession they are found.


Richard Bedford Bennett: Which is not this section at all.


Charles Hazlitt Cahan: That is entirely different.


Charles Avery Dunning: Surely the new one is an improvement on that.


Charles Hazlitt Cahan: Improvement in what way? It is an improvement by an infringement of the legislative competence of the provincial legislature. If we can deal with it, we can deal with the prosecution of one who has goods unlawfully in his possession, or goods in his possession which do not conform with the law. Now we are providing for prosecution of a person who advertises these seeds
Seeds

or plants. Take the case of newspapers containing advertisements, they are liable, whether they know anything about it or not. Or " who offered or had in his possession for sale the said seeds or plants." So far as they are in possession, the old law and the present one are practically the same; but to go beyond that, to punish some person other than the possessor, is an extension which is doubtful indeed.


Frederick George Sanderson: Carried?


Charles Hazlitt Cahan: On division.


[Stage Direction]
Section agreed to, on division.
On section 21-Illegal sale.
Richard Bedford Bennett: Would the minister notice the difference between the fines that can be imposed under this bill and under the other statute? Here the maximum fine for a first offence is $25, and for a subsequent offence the maximum is $250; whereas in the other statute it was $500.


James Garfield Gardiner: It is quite a different offence, though.


Richard Bedford Bennett: I should think it was; this is more serious.


James Garfield Gardiner: Oh, I do not think so.


Richard Bedford Bennett: This deals with seeds.


James Garfield Gardiner: It is not more serious.


[Stage Direction]
Section agreed to.
On section 22-Penalty for tampering or obstruction.
Richard Bedford Bennett: Might it not have been desirable to provide for the act to come into force on a date certain, rather than on the day that it is assented to, because certainly it has one or two provisions which it is desirable that people should know about. I just mention that to the minister; it is not a matter of importance to me; the minister knows better than I.


James Garfield Gardiner: I think probably this
will be all right, at this time of year.


Richard Bedford Bennett: It struck me that it might be a matter of difficulty.


James Garfield Gardiner: It is just preceding the seeding period.


Richard Bedford Bennett: There are some new
provisions which it may be difficult for people to observe who do not know anything about the measure; for instance, the sections dealing

with advertisements and things of that sort. Is this a time when advertisements are largely circulated? I do not pretend to know.


James Garfield Gardiner: I think it is all right
to have the act come into force when it is assented to.


[Stage Direction]
Section agreed to.
Sections 23 to 25 inclusive agreed to.
Preamble agreed to.
Frederick George Sanderson: I want to point out
to the minister that I have two copies of this bill, and I did not get the new bill until we arrived at section 13.


James Garfield Gardiner: Perhaps you had better read over the numbers in the new bill.


Richard Bedford Bennett: I think it might be taken that there is no difference between the old copy and this one up to section 13.


Charles Avery Dunning: All the members of the
committee have had the new bill before them and their decision was registered with respect to the new bill. I think, therefore, Mr. Chairman, you can safely initial the clauses from clause 13 onwards in the new bill now in your hands.
Bill reported, read the third time and passed.



SEED GRAIN


[Stage Direction]
Hon. J. G. GARDINER (Minister of Agriculture) moved the second reading of Bill No. 101. to assist the provinces of Alberta, Manitoba and. Saskatchewan in financing the cost of seed and seeding operations for the crop year 1937.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Short title.
Ernest Edward Perley: I think the
minister has agreed that on taking up the bill he will give us some information. He has referred to a number of municipalities. In the past, I understand, seed has always been provided on the basis of the number of acres, and I should like to know the number of acres to be provided for, also the number of acres for which seed was supplied in 1936.


James Garfield Gardiner: I am sorry that the
years mentioned by the hon. member are not those that were under discussion the other

Seed Grain Assistance
night. I have particulars regarding the two years 1934-35 and 1936-37. Those are the years which more closely compare; last year the assistance was comparatively small.


Richard Bedford Bennett: That is 1936, last year.


James Garfield Gardiner: Well, last year was
1935-36. I have 1934-35 and 1936-37, which more nearly compare. I will give the figures. In the year 1934-35, which is the last big year as regards the supply of seed, there was supplied for seed wheat 3.295,000 bushels, and the acreage was 2,995,000; seed oats, 2,900,000 bushels, 1.675,000 acres; rye, 5,000 acres and
5.000	bushels; barley, 110,000 bushels, 73.000 acres. This is only for Saskatchewan. These figures differ slightly in bushels per acre from the figures for this year for the reason that it was rather the heavier lands that were seeded under the plan of 1934-35. The hon. member for Qu'Appelle will understand the reason for that. There was a crop failure over a considerable part of the heavy clay lands in 1934-35, whereas there was no failure last year. That resulted in a larger allowance in bushels per acre than is made in the arrangement this year.
For 1936-37 the figures are: seed wheat,
2.739.000	bushels, 2,739,000 acres; the acreage is exactly the same, it being estimated that a bushel to the acre will be seeded; oats,
2.279.000	bushels, 1,300,000 acres; barley, 46,245 bushels, 39,000 acres; flax, 7,200 bushels, 14,400 acres; rye, 10,400 bushels, 10,400 acres.
It will be noted that the acreage for which seed is to be supplied this year is about 256,000 less than in 1934-35, and the acreage that is to be seeded to oats is about 375,000 less. The acreage to be seeded to barley is a little more than half what it was in 1934-35; the acreage under rye is double what it was in 1934-35, and the acreage to flax this year is an addition. There was no acreage under flax in 1934-35.
In order to make the picture complete and give some idea whether the estimate this year is on a basis similar to that of 1934-35, I might point out that the federal government in 1934-35 supplied $6,000,000 outright. The mortgage companies and the banks supplied $2,030,000 worth of seed without any guarantee from the federal government, but the mortgage companies had a guarantee from the provincial government, just as they are having this year, and in some instances the banks were also guaranteed by the province. The provincial government supplied funds amounting to $759,000, in round figures. That makes a total of $8,789,000 for 1934-35, or approximately what was asked for this year by the 31111-175
provincial government. The mortgage companies are still supplying seed for their land, in addition to what the federal government is guaranteeing.


Thomas Clement (Tommy) Douglas: With a provincial government guarantee?


James Garfield Gardiner: I presume so. We are not in that picture.


Richard Bedford Bennett: To what extent?


James Garfield Gardiner: The figure is about one million dollars for the mortgage companies in Saskatchewan. That is the only province from which complaints have come, and therefore I have secured the figures. The banks in that year supplied $999,000, and I do not know of any reason why they should not supply this year a considerable amount not subject to guarantee. Assuming therefore that the banks and mortgage companies supply as much this year as in 1934-35, the guarantee still provides for $600,000 more than was supplied in 1934-35. When you consider the acreages, which are smaller, and the fact that there has been an increase in the price of grain, these two factors will fairly well balance up, and our experience of 1934-35 should be sufficient to justify our action this year. In other words, having carefully reviewed the figures and gone over them with the provincial government, we are satisfied that the situation in Saskatchewan will be met by the provision of the amount in the bill.


Major James William Coldwell: Is there not a feeling that in previous years the farmers were probably not as anxious to have as great an acreage as this year, when with higher prices in view they hope to recoup some of their losses? Is it not also a fact that there is a deduction from the amount of seed grain, if the farmer gets repairs, and that with the present condition of machinery the applications for repairs are fairly heavy? If these applications are granted, that will reduce the amount of seed considerably, and that is one of the criticisms that have been represented to me.


James Garfield Gardiner: The remarks of my hon. friend remind me that the figures I have given include tractor fuel, repairs, feed and fodder and everything of that kind which is required for putting in the crop. It includes not only seed but seeding supplies. While it is true, as has been said, that the farmers will probably desire to put in a greater acreage as a result of the increase in price, I believe it will be agreed that the fact that the price has gone up should improve the credit of many people in Saskatchewan to the point where we should expect the banks

Seed Grain Assistance
.COMMONS
and mortgage companies to take care of seed in connection with certain lands. While the price will no doubt be an incentive to people to put in a greater crop, at the same time the fact that there is an increase makes it all the more possible for the individual to pay back than it was in 1934 when the price was low.


Thomas Clement (Tommy) Douglas: On the basis of a survey they made, the provincial government, I believe, made an estimate of $8,700,000 for this year. Has the minister any figures as to the estimate they submitted to the federal government in 1934-35?


James Garfield Gardiner: I am not able to give the figures, but I reviewed the estimate at the time in the province. The estimate that is brought in from the municipalities is always very much higher than the amount the provincial government finally agrees to, and the provincial estimate is usually higher than the amount the federal government will agree to guarantee. There are three checks instead of one, and all I can say is.that after all three checks had been made in previous years the lowest amount has always taken care of the needs of the farmers. In fact, last year it more than took care of them.
There is another matter which I have hesitated to mention because we do not want to attract too much publicity to it, and that is that these guarantees are not usually called for until the crop is all in. No close check can be made in the matter until much later in the season than the seeding. I think much of the agitation that is going on is without full information of the actual working out of a scheme of this kind. We shall be back here in session again before it will be known what these guarantees amount to. I think the amount prescribed in the bill is sufficiently high to warrant the financial institutions paying out to the farmers enough to take care of all their seeding needs.


Thomas Clement (Tommy) Douglas: Do I understand that the seed and feed have already been bought by the provincial governments? I notice in the press reports that so many cars have come in ready for distribution.


James Garfield Gardiner: It cannot properly be said that the seed has been purchased. Arrangements have been made throughout the winter season for grain companies to ship the seed where it is going to be required, and the government or someone becomes liable to pay for it only when it is taken out of the elevators. What usually happens is that the individual makes arrangements through the municipality for a credit at the
fMr. Gardiner.]
bank, and when he gets that credit he goes to the elevator and gets the wheat and issues a cheque for it. So it would be improper to say that the grain has been purchased now by the province or anyone. The grain is actually purchased by the individual.


Thomas Clement (Tommy) Douglas: What price will be fixed for the wheat in this guarantee? Will it be the price as of the day it is sent to the point, or at the time it is taken from the elevator?


James Garfield Gardiner: There is no price fixed in the guarantee.


Thomas Clement (Tommy) Douglas: But the farmer will have to sign a note for so many bushels at so much a bushel. When is the price per bushel set?


James Garfield Gardiner: As I remember what takes place, the farmer is not asked to sign a note for so many bushels, he is asked to sign a note for so much money.


Thomas Clement (Tommy) Douglas: But representing so many bushels of wheat.


James Garfield Gardiner: He is allowed enough to buy so many bushels. Then the collections are made by the bank in the fall, and it is only when the note is not paid that the government becomes interested. If these collections are not made during the following three years, the government becomes liable to pay. But there are three years in which the bank goes on making collections.


Thomas Clement (Tommy) Douglas: The point is, a farmer taking delivery of this wheat will, I presume, get it at the price of wheat at the time, which will be considerably higher than the price in 1934-35; and while $6,000,000 in 1934-35 compares favourably with $6,700,000 this year, in view of the difference in the price of wheat it will not represent as much feed or seed to the farmers as the $6,000,000 in 1934-35. Is that not correct?


James Garfield Gardiner: No, that is not in accordance with what happens. The Minister of Finance indicated to the house the other day that while last year we put through a bill which empowered this government to give a guarantee limited to $4,000,000, there was, in fact, never more than $3,500,000 worth of seed put out. By the time the dominion government was asked to come into the picture, even to' recognize that they might have to give guarantees, $1,000,000 of that had been paid back. The provincial government could have gone very much further than the $4,000,000 and still have been safe. This year we are in the same position. As I just stated, it will not be known until probably next fall how much this government is going to be liable for. Past experience indicates that a considerable amount of what we put out will

Seed Grain Assistance
he collected this fall, -more next fall, and still more the following fall; and we shall finally come into the picture for whatever part of the $6,700,000 is then left. So that there is considerable leeway to -the province. The province has control of the distribution.


Thomas Clement (Tommy) Douglas: I am sure that is not generally understood.


James Garfield Gardiner: It is probably just as well that it is not, if we want to keep the expenditure down.


Ernest Edward Perley: No doubt the minister -has received -many reports from the west protesting that farmers are not able to get more than about half enough seed, and no doubt he has seen- in to-day's press, dispatches from -the west that farmers are holding meetings and some suggesting that they go on strike and put no seed in. Of course, I think that would not be a good idea. But there is no doubt that the government and the municipalities made some estimates last fall of the acreage for which seed would be required. The farmer goes to the municipality and makes his application for seed, and will receive seed at a given price. I h-ave already this year had to sign two consents for seed. There is no question that if he is taking the seed out now he will -have to settle on the basis of the price at the time it is taken. The other night the minister said that arrangements had been made early last fall before the wheat would be shipped to Fort William for the holding of wheat in the area or for shipping wheat in, to make sure that an abundance of seed would be available. I think the minister should give some details respecting the arrangements made with companies for shipping seed into the area. Surely there was some understanding with respect to price. I think it was the first Friday in January that a report was made to the grain commission, showing that James Richardson and Company -held about 75 to 80 per cent of the total wheat west of Fort William, and at that time there were only about 26 to 27 million bushels west of Fort William. So it would seem this firm has had considerable to do with supplying the wheat.
I should also like to know whether the grain board has had anything to do with securing this wheat. I would judge that the government took some action either in arriving at a price basis with the firm that shipped it in, or that they secured an option. We know that the provincial government on other occasions has secured an option with respect to seed grain. The one with respect to oats did not work out very well.


James Garfield Gardiner: It paid its way.
31111-175i


Ernest Edward Perley: On this occasion if the government took the option, as there is no doubt they should have done in order to secure the wheat for the farmer as cheaply as possible, they will have considerable profit and will be able to give to the farmer wheat at the price of say last November. I think we should have some information from the minister respecting the arrangement made, and with what company he made it. I am informed on pretty good authority, and possibly the minister knows, that James Richardson and Company have a private wire between their Regina office and the office of Mr. Williams, the purchasing agent for the provincial government. If that is the case, there is no doubt that this one company is figuring considerably in the supply of this wheat. If a company was to be employed to secure the options, if it was to be- dealt with in that manner, I think the wheat board, having membership in the Winnipeg exchange and clearing house, could have done that work just as well and perhaps at a considerable saving to the government, instead of a private firm being employed. I think the committee should have a little more information with respect to these matters.


James Garfield Gardiner: The points that have been raised by the hon. member for Qu'Appelle are, of course, points that do not concern this government at all. We have nothing whatever to do with these arrangements; they are all made by the provincial government, and I have no information as to whom this grain will be ultimately purchased from. But knowing Saskatchewan as I do, knowing that the pool has elevators at nearly all the marketing points in the province-I doubt very much if there is any company that even approaches it in the- number of elevators from which grain can be distributed-and knowing what has been the record in the past, I would expect the pool to supply very much the greater portion of all the grain required for seeding purposes. I do not imagine that the Richardson company will figure to any greater extent than that they may have elevators here and there throughout western Canada, and I would not imagine they have very many of them. At points where they have elevators, however, if they have wheat which they are willing to sell at the same price as any other elevator company, I presume some of the farmers will go to the Richardson elevators for their grain. That, however, is not a matter that is decided even by the provincial government, in my experience; it is a matter that is decided by the individual himself. He goes wherever he can get the best seed wheat. If he gets the
Seed Grain Assistance

best wheat at a pool elevator, he will go there; if he gets it at the Richardson elevator, he will go there. The bills will come in, I presume, at the price at which the wheat is sold to the individual, and I would imagine that this price probably would be the market price at the time the deal was made. Many of these farmers took out their seed weeks ago, some of them months ago, and the deal made at the time is the deal that will be carried out. From our experience with all elevator companies, however, I am sure they will carry out this transaction with the provinces in the best possible way.


Ernest Edward Perley: The minister has hardly answered the question. The other evening he stated that arrangements had been made with companies either to ship grain in or have it held there. Neither the pool nor any other company would hold grain from last November, with the advanced prices from December and January, without some definite arangement as to the price at which that grain is to be sold. If the grain is to be shipped in, there is no question but that the Richardson company will figure very prominently, because that company has the largest amount of wheat in the west. When the minister stated the other night that arrangements had been made, surely he had knowledge of those arrangements, and surely he can give us more details than we have received as yet.


James Garfield Gardiner: All I can say is that the provinces have advised me that arrangements have been made to have the grain remain there. Judging from past experience I would say that the grain would have been there even if no one had made arrangements. No one in western Canada is more interested than the elevator companies in seeing that the grain is there. If seed is not sown in those areas, there will be no necessity for any elevators next fall. As a matter of selfinterest, the elevator companies see that seed grain is in their elevators in the communities where the farmers have no seed grain. Even if the government had paid no attention to the matter at all I am quite satisfied that the elevator companies would have seen to it that sufficient seed grain was left to re-seed the area. I do happen to know, from information passed on to me, that the provinces have taken an interest in the matter and that seed was left in these different areas; so I am quite satisfied that the seed is there.


Ernest Edward Perley: It so happens that the report to the board of grain commissioners shows that on the first Friday in January the Richardson company held nearly

all the grain, so the argument that the elevator companies were leaving the grain in the country elevators to make sure seed would be available is not very good. Perhaps the Richardson company did that; but what about the four hundred other members of the grain exchange who held a very small percentage of the grain in western Canada at that time?


James Garfield Gardiner: Of course, that might easily be true without making any difference in what I have said. After all, they only want three million bushels; Richardson could have all the rest of the grain, and still the other companies would have enough seed wheat distributed over the area to take care of the demand.


Major James William Coldwell: In reply to the hon. member for Weybum the minister stated that there was no fixed price for the wheat. I would take it, then-


James Garfield Gardiner: No, I said that we had not fixed any price in this guarantee, but I am not in a position to say there is no fixed price. The provinces may have arranged a price; I do not know.


Major James William Coldwell: That is the point I was going to make, that if the provinces have not arranged a fixed price it amounts to this, that the farmers sold their wheat before Christmas for a dollar a bushel or so, and to-day they will have to buy wheat at $1.50 a bushel.


Charles Avery Dunning: Under such circumstances a farmer certainly should not get any seed under this act.


Major James William Coldwell: I am talking about farmers in a general way, not so much the farmers who grew the wheat. The farmers generally sold wheat at around a dollar a bushel. To-day other farmers engaged in the same industry have to buy back that wheat at $1.50. Or worse still, the government of Canada sold millions of bushels of wheat, at around a dollar a bushel and today the government of Canada is guaranteeing the payment of perhaps $1.50 a bushel. The point I was trying to make is this: The minister cannot tell us whether or not any arrangements were made by the provincial governments. This drought situation was obvious before Christmas. It was obvious that seed would .have to be supplied, and it seems to me the federal and provincial governments should have endeavoured to enter into some arrangements as to the price of seed grain well in advance of the development of this situation.

Seed Grain Assistance


James Garfield Gardiner: There is no doubt about that. I said I did not know what the arrangements were in detail, but I do know that the wheat is there, all arranged for, and the farmers can get it.


Mr. COLD WELL:: That is a little better, but the responsibility for carrying out the plan rests with the provinces. That being the case, I want to ask another question. I take it that the circular to which I referred on Monday, showing the reduction suggested in the amount of seed and supplies, was sent out under provincial rather than, federal authority. but the amount of money involved, $6,600,000 instead of the $8,700,000 which was asked for by the provinces, is the decision of the federal authorities, I take it.


James Garfield Gardiner: The amount of money finally available for the distribution of seed is not a, matter for the federal government. Of necessity the amount to be guaranteed by the federal government is decided here, but the province can still use its credit and any funds that may be in its treasury. As a matter of fact, in 1934-35 the province used three-quarters of a million dollars of its own money. So a province can use its own credit for the purpose of giving further supplies if it desires to do so. Any municipality can do that.


Major James William Coldwell: I want to be quite clear about this. The amount of $6,600,000 was the decision of the federal government, or was it arrived at by arrangement and agreement between the two governments?


Charles Avery Dunning: Perhaps I can answer that question more readily. When any guarantee is asked of the federal government the closest possible examination is made as to the need for the amount involved. That necessarily involves representations by the parties requiring the guarantee. I have never known parties requiring a guarantee to ask for less than was required. One can always rely upon them asking for enough, and the experience in connection with seed grain, as indicated by the Minister of Agriculture, is that the guarantees hitherto given have proved amply sufficient to take care of the situation. If the hon. member will read the bill, he will see that the responsibility of this parliament is with respect to authorizing a guarantee under each of the sections, relating separately to each of the provinces, in order to enable the relevant provincial act to be cited.
It is not certain that precisely the same methods will be followed in each province. We are not here concerned with the precise
method by which provincial authorities arrange for the acquisition and distribution of supplies of seed. We are concerned with having discovered the minimum dominion guarantee which we believe will be adequate to deal with the problem.


Thomas Clement (Tommy) Douglas: In view of the fact that the circular sent out on January 28 by the provincial government, which I am not quoting now because I made reference to it the other day, made a survey on the basis of an absolute minimum, stating $2 per acre, a certain amount per bushel, the amount of feed to be allowed and the amount of fuel as the very maximum; and in view of the fact that there might be a somewhat increased price for feed, seed and fuel it seems to me that the federal government would have been within its rights, when computing the amount they were willing to guarantee, in considering favourably the figure that was suggested. After all. the amount asked for, $8,700,000, as compared with $6,000,000 in 1934-35, does not represent actually an increase in price for seed. It does not actually represent more in seed. In view of the fact that they had surveyed their needs and that the need had been based upon an absolute minimum, it would seem that for the federal government now to reduce the amount in terms of seed-* not in terms of money-that it is willing to guarantee will place the provincial governments, the municipalities, and some of the farmers in a difficult position. While I am glad to hear the Minister of Agriculture say that the needs of the people will be looked after-and I hope he is right-the fact remains that perhaps this is the first year in quite a number that in Saskatchewan there is the slight possibility, in view of prevailing prices, that some of the farmers may be able to recoup some of their losses and pay some of their debts.


Charles Avery Dunning: That will not make it rain.


Thomas Clement (Tommy) Douglas: No, but after the inspiring speech made by the Minister of Finance some time ago, about having faith in the recuperative powers of the drought area-


Charles Avery Dunning: But not enough faith to put expensive seed into land which all science and agriculture has demonstrated will not offer a fair or even chance. That is one of the points which is important when one considers the extent of distribution of seed; we must consider whether we will encourage seeding on land which is worse than a normal gamble.


Thomas Clement (Tommy) Douglas: In the first place, the minister says his faith is not strong enough.
Seed Grain Assistance


Charles Avery Dunning: la it a kindness to anybody to permit him to sow such seed? If the hon. member has ever farmed, he knows what I mean.


Richard Bedford Bennett: He has not faith even as a grain of mustard seed.


Thomas Clement (Tommy) Douglas: Faith without works is dead. As a matter of fact, however, the minister knows very well from his experience in Saskatchewan in days gone by, that men have seeded in the spring, almost in dust, and that the June rains have made a great difference.


Charles Avery Dunning: On some parts of a farm; I am distinguishing between one part of a farm and another part, from the standpoint of cultivation.


Richard Bedford Bennett: Between summer fallowed and other land.


Charles Avery Dunning: Yes.


Thomas Clement (Tommy) Douglas: The fact still remains that some of the best crops have been harvested in Saskatchewan in years when seed bed conditions in the spring were not good, but when subsequent June and summer rains have immeasurably improved conditions. This is one year in which the farmers of western Canada are beginning to see a gleam of hope, There actually was a possibility of again putting agriculture on a paying basis. I hope nothing will be done by the federal government which will place provincial governments in a position of being compelled so to restrict the amount of seed grain that they will curtail the livelihood of any of these people in the coming year.


Major James William Coldwell: The Minister of Finance has said that seeding on some of this land was a gamble we ought not to undertake, or words to that effect. May I say that those people are on the land in question, and were allowed to go there by federal authorities.	.


Charles Avery Dunning: I think the hon. member has misinterpreted what I said. I believe I qualified my statement. The good farmer seeks to sow land which is in a state of cultivation or which, from the experience in his own district and on his own farm, he knows offers the maximum chance of giving a return. Always in a year of high prices he is under the great temptation to sow another field on his farm which he knows is not in a state of tilth and cultivation which would be most likely to produce the best results. In other words, the incentive to gamble on unfit land is always greater during a period of high prices. I see the hon. member for

the Battlefords over there. I know that in his district a demonstration was given a number of years ago. On one occasion it worked out all right, but in four succeeding occasions it did not.
The point I am making is that there is an incentive to the farmer to gamble on land on his own farm which really is not a fair gamble. It is not a gamble as between farmer and farmer and district and district.


Major James William Coldwell: Reading the western
newspapers which have just arrived I find the criticism that a great deal of summer fallow will not be seeded this year because there is not sufficient seed, fuel or feed. I was reading an account of a meeting which appeared in the Leader-Post of Regina, and that was the criticism there made. They say that land in good tilth, which has been summer fallowed cannot be seeded because, first, of the condition of the horses due to insufficient feed; the necessity for tractor and repairs, and so on.


Thomas Clement (Tommy) Douglas: I can assure the Minister of Finance that on the basis of the schedule sent out by the provincial government on January 28 there was no possibility of putting under cultivation fields which were not fit for seed. That schedule was cut to a minimum, and I am not criticizing that fact. In view of conditions, it was a wise thing to do; but to cut it further may have serious consequences.


Richard Bedford Bennett: I should like to ask the minister a few questions I raised the other evening. It is quite clear that the federal government was aware that seed had to be purchased, for they passed governor general's warrants in the early part of 1936.


Charles Avery Dunning: Not warrants for seed.


Richard Bedford Bennett: No, governor general's warrants for relief. Therefore it was apparent that the situation would require seed in 1937. What, if any, steps did the government take to secure seed for western Canada at the then prices?


James Garfield Gardiner: When provincial representatives were here last September from Saskatchewan, Alberta and Manitoba, the question as to how seed would be supplied this spring was raised.


Richard Bedford Bennett: I understand that.


James Garfield Gardiner: We then expressed a preference for the method which is now being followed, so far as the federal government is concerned. We preferred this year to follow the same policy for all three provinces as

Seed Grain Assistance
was followed last year with respect to Saskatchewan, and asked the provinces to make their representations at a later date, after they had sized up the situation as to whether that suggestion would meet their conditions. All three western provinces finally agreed that that method would meet the situation existing. When they were here last September they agreed or they stated that they would make any provisions necessary for having that seed in the proper locations, where it would be retained until the spring. They indicated then that they would require to have some assistance to finance the transaction, but no assistance was required for any other purpose. As a matter of fact, I think the federal government has always taken the position that the responsibility for supplying seed is a provincial responsibility. This has been the position taken, at least since the lands were turned over to the provinces; and having taken that position, we do not feel that the federal government should take any action in connection with the actual supplying of the seed.


Richard Bedford Bennett: That answers one question, but it does not answer the next question I shall ask, nor has it fully answered the one I have just asked. Knowing that seed grain had to he acquired, did the government indicate in September last, as a condition of the granting of these guarantees, that the wheat should be acquired before the spring or at any particular time?


James Garfield Gardiner: No, that was left to the provinces.


Charles Avery Dunning: Except that they knew we would help in this manner.


Richard Bedford Bennett: If they knew that we would help, and it was not made a condition that they should acquire the wheat without delay, the result is that the provinces sat by, with the acquiescence of this government, and saw wheat rise in price forty and fifty cents a bushel. The farmer will have to repay this money, and instead of having the benefit of a reasonable price they will have to pay the higher prices, enriching the present holders of the grain. That is what will happen, instead of having made it a condition that the wheat should be acquired at once and storage charges paid, which would have amounted to about a thirtieth of a cent per day.


Charles Avery Dunning: I cannot say that the provinces have not acquired the wheat.


Richard Bedford Bennett: I think it is the business of this government to be able to tell me whether they have or have not. As a citizen of this country I have a right to know. I say it was
the duty of the federal government to impose as a condition to the granting of this aid in September last that the wheat should be acquired. Everyone knew that there would be a rise in price.


Charles Avery Dunning: That is an old question.


Richard Bedford Bennett: Here is an editorial which appeared in a Toronto paper in August, 1936. This man knew nothing except the great wheat movements and he heads his article "Wheat Stocks a Gold Hoard." There was not a single operator in this country who was not acting on that assumption. I ask this government why they did not impose as a condition the immediate acquiring of this wheat, instead of allowing profits to accrue to those who owned the wheat? There would have been a benefit accruing to the farmers by the lesser price they would have had to pay. That is the question I want answered.


James Garfield Gardiner: I should like to ask this question: Was such a condition ever imposed upon any province in connection with the supplying of grain?


Richard Bedford Bennett: We have never had such conditions existing.


James Garfield Gardiner: We had a similar condition in 1932. Wheat was down to 26 cents per bushel and by the next year it had risen just as much as it has gone up this year, although it did not go to as high a price. No government of Canada has ever imposed such a condition at any time.


Richard Bedford Bennett: Yes, it has.


James Garfield Gardiner: Not in any experience I have had in the province of Saskatchewan.


Richard Bedford Bennett: I happen to know that the wheat board took steps to acquire wheat.


James Garfield Gardiner: In 1934 the wheat board took steps to acquire wheat at the request of the provincial governments.


Richard Bedford Bennett: The provincial governments might have requested as much as they liked; it was the dominion government that did it. It is quite true the provinces asked that it should be done, but the federal government became a party to its being done. Here is the difficulty, and I think it is a real one. Abnormal conditions prevail in the world. The government say they did not believe what everybody else believed. They are pledging the credit of the country for $9,000,000, and I think it was their duty to impose as a condition the acquisition of the wheat at the then price, instead of the present price of 30 or 40 cents a bushel more, which must
Seed Grain Assistance

be paid back by the farmers. A farmer wanting 100 bushels of seed might have been able to get it at $1 per bushel, instead of having to pay SI.40 per bushel. I submit that that was the duty cast upon this government, having regard to the market conditions then prevailing. The government say they do not know of its having been done before, but I say that in the fall of 1934, Mr. McFarland was providing for seed grain when the provincial governments' requirements were known.


James Garfield Gardiner: At the request of the provinces.


Richard Bedford Bennett: Long before the provinces requested it he realized that seed grain had to be provided. As the minister says, this is not a matter in which we deal directly, but we are providing the money to pay for it. The government must have seen this upward movement during the last three months. At any time during that period from 15 to 20 cents a bushel could have been saved; but the farmer must now pay this higher price for his seed to heighten the profits of those who held it from the others.


Mr. CRERAR:: What would have happened if that suggestion had been carried out and the price of wheat declined 20 cents a bushel? The farmer would have had to pay 20 cents a bushel more than the market price.


Richard Bedford Bennett: I say there was no likelihood of that. Even the editors of newspapers were predicting what would happen. What is the condition to-day in Canada? The Minister of Finance is getting 18,000,000 where he expected a loss of $15,000,000 a year ago.


Mr. DEACHMAN:: The price is down a few cents to what it was some days ago.


Richard Bedford Bennett: And I dare say it will go lower for the very reasons I have mentioned.


Robert John Deachman: Let me know so I can go short.


Richard Bedford Bennett: As a matter of fact, I have never owned a bushel of wheat in the market in my life. I leave that to others. That is just what I am and have been complaining about ever since I had an intelligent appreciation of the facts. If speculation were stopped in this country we could have some hope for the future. As it stands to-day, the farmer of western Canada is being forced to pay a price for his seed grain which constitutes a profit inuring to the benefit of those who held it in the elevators. This is what has happened while the provincial government

sat by; and this government, knowing that we must give our. guarantee, took no steps to impose the condition that they should acquire the wheat before it was too late.


James Garfield Gardiner: The question raised by the right hon. leader of the opposition is not new. It has come up every year that seed grain has had to be supplied. It is true that in the fall of 1934 the wheat board of that time handled the transactions which were necessary to the providing of seed wheat and oats. But they did so only at the request of the provincial governments. When the provincial governments did make requests, the federal government permitted the board to act only on the condition that it was done under a special guarantee.


Richard Bedford Bennett: Which the federal government gave.


James Garfield Gardiner: Which the federal government gave. The guarantee in connection with the oats transaction was apart from the guarantee in connection with the handling of grain for stabilization under the control of Mr. McFarland.


Richard Bedford Bennett: The provinces promised to recoup.


James Garfield Gardiner: The provinces were
held responsible, but the federal government guaranteed the accounts. That was done to provide for exactly the thing that the leader of the opposition is now suggesting might have been done this year, and ever since 1934 we have had insinuations thrown across the floor of this house that something else might have been done in 1934-35.


Richard Bedford Bennett: We know that Mr. Brown sold oats, if that is what you mean,


James Garfield Gardiner: Well, I do not know
that the right hon. gentleman knows Mr. Brown sold oats. One might say that Mr. McFarland sold oats.


Richard Bedford Bennett: No, we know that Mr. Brown sold oats.


James Garfield Gardiner: I believe the leader of
the opposition stated on the floor of the house last session that Mr. McFarland was interested in those oats that were being held at that time-


Richard Bedford Bennett: No, no, not those oats.


James Garfield Gardiner: -and had some transactions in connection with them.


Ernest Edward Perley: We know Mr. Brown says that Mr. Gardiner sold oats over his head.

Seed Grain Assistance


James Garfield Gardiner: Of course, hon. gentlemen can say anything they like across the floor of the house, knowing they are in the house. But Mr. Gardiner has never sold a bushel of oats except those grown on his own farm.


Ernest Edward Perley: Sold for the
government.


James Garfield Gardiner: I may add that if the
provincial government had followed the course that some of their critics would probably have preferred, they would have likely lost money on the oats of 1934. I think if hon. members examine into the accounts now, they will find that not very much has been lost; as a matter of fact, I believe they will find there is a profit. But surely no one in this house is going to suggest that any government should act otherwise than upon the experience they have had in the past in connection with a matter of this kind, and I have not any doubt but that the government of Saskatchewan has had sufficient experience in the handling of grain for seed to handle it to just as good advantage as could be done by this house or any other. The same is true of Manitoba and of Alberta. As a matter of fact last year Alberta, without consulting this government or having any communications with it, went to the wffieat board and bought wheat for their seeding operations, and found out after the purchase that they had about 600,000 bushels, as I recall, more than they required. They bought it at a certain price, and later on they wanted this government to take the loss that had been incurred in connection with the purchasing of that wheat from the wheat board. This government had assumed no obligations whatsoever in connection with it, and so indicated. Later on the price of wheat went up, and the Alberta government, I understand, did not lose anything, but sold the wheat at a price equal to what they paid for it. In other words, if we in this house start to guess how high or how low wheat is going, we shall probably make as big a mistake as the farmer or anyone else who tries to guess the price of wheat.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


Frederick George Sanderson: Section one is before the committee.


[Stage Direction]
Section agreed to.
Sections 2 to 5 inclusive agreed to.
On section 6-Terms of guarantee.
Charles Hazlitt Cahan: I think we should have some explanation of the thirtieth line, "unable to fulfil its guarantee in respect of the same loan." Who is to decide whether the province is unable to fulfil its guarantee? Is there any other ground for that decision than its failure to fulfil the guarantee? It strikes me that the words "is unable" should be struck out and the words "shall fail" be substituted therefor.


Charles Avery Dunning: It is desirable to have the decision made upon inability rather than failure to implement. I should prefer to leave room for negotiation rather than to have the government liable on failure by the province to pay.


Charles Hazlitt Cahan: This is a guarantee to a certain bank or certain banks which advance money, and I suggest with great respect that the banks in accepting the guarantee will wish to know when it is enforceable, when the liability of the government of Canada to them shall accrue. I cannot understand its accruing under the terms mentioned here. Unable, why? Because the province has not the money? Because it is not able to raise the money? I suggest that if the banks are as careful in lending money to the provincial governments as they are in lending to corporations and individuals they will not accept a guarantee expressed in these terms.


Charles Avery Dunning: The banks who are guaranteed under this legislation, and who, of course, are the parties chiefly interested in the implications of these words, did accept this form last year, and there is no doubt at all that they fully understand what is involved in this legislation and are prepared to accept it this year. I wish my hon. friend would not press me further on the point.


Charles Hazlitt Cahan: Perhaps there is some reason that should not be divulged-


Charles Avery Dunning: No.


Charles Hazlitt Cahan: -but it seems to me that under this any province can simply lie back and say: We are unable to pay; we have not the money in the treasury and are unable to obtain it. Then this government becomes liable to the banks if the banks are willing to accept that excuse.


Charles Avery Dunning: We should be much more directly liable if the words "shall fail to pay" were there instead of the words "unable to pay." That would leave no room for negotiation. If my hon. friend's suggestion were

Customs Tariff-Rale of Exchange
incorporated in the bill and the province simply failed to pay, though not unable to pay, we should undoubtedly be automatically liable. The present wording does leave some room for negotiation in the event of a large guarantee accruing and some question arising as to what proportion the province might be able to pay.


Charles Hazlitt Cahan: Well, I will not press it
further.


[Stage Direction]
Section agreed to.
Sections 7 to 9 inclusive agreed to.
Bill reported, read the third time and passed.


James Lorimer Ilsley: Mr. Speaker, I should like to move the second reading of Bill No. HI, to amend the customs tariff.


Richard Bedford Bennett: I think you had better say, with the consent of the house.


James Lorimer Ilsley: Yes, with the consent of the house.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Rate of exchange on appreciated currency in computing value for duty of imported goods.
Richard Bedford Bennett: I think the principle of this is entirely wrong but I have no desire to enter into a long discussion of it. It confers upon the governor in council power to do something that might be most injurious to the Canadian people. I suppose we must trust to the government not to do it; that is all. That, I dare say, is a safe assumption. At any rate it is to be hoped that they will not do it wittingly. If I buy one hundred marks' worth of goods, I have to send back $40 at the present time. As a matter of fact, assuming that you operate under this statute, $25 will pay for the goods. The duty is computed on the basis of $25, and twenty per cent on that being $5, the total duty to the buyer is $5 instead of $8 under the twenty per cent tariff. That is a reduction of 40 per cent almost.


James Lorimer Ilsley: It might be proclaimed at 35, for example.


Richard Bedford Bennett: 
James Lorimer Ilsley: At present it would be virtually impossible for importers in Canada to import goods from Germany if they were obliged to remit 40-18 cents for each German mark of the home market value of German goods. Our Customs Act and customs tariff provide that the duty is calculated on the home market value of the goods, and if the goods are purchased at less than home market value the special or dumping duty applies. The German free mark or gold mark is so greatly appreciated in terms of Canadian currency that imports from Germany would virtually cease if importers here were actually remitting 40-18 cents per mark.
Mr. HEAPS. How are other countries meeting the situation?


James Lorimer Ilsley: I fancy all countries are meeting it just as Canadian importers are, by not remitting in free marks.


Richard Bedford Bennett: But is not the home market price in terms of marks other than the gold mark?


Charles Hazlitt Cahan: Yes.


Charles Avery Dunning: But there is no exchange value between the two. You cannot exchange one for the other.

Customs Tariff-Rate of Exchange


James Lorimer Ilsley: There is only one mark. The difference between certain marks is that some are restricted in their use; others are unrestricted.


Charles Hazlitt Cahan: And they are not of the same value.


James Lorimer Ilsley: They are not of the same value abroad.


Charles Hazlitt Cahan: They are not of the same value in Germany.


Richard Bedford Bennett: The gold mark is an international mafk only, to settle trade balances. I can use the travel mark or registered mark in Germany, and they fix 150 a day as the maximum I may have, except in special circumstances. That is not the gold mark at all.


James Lorimer Ilsley: When I say there is only one
mark, perhaps I should say there are different
types.


Charles Hazlitt Cahan: They have the same name but not the same value.


James Lorimer Ilsley: I understand there are seven
or eight classes or types of mark. Some of these special marks can be purchased in the money markets at perhaps 30 cents, 25 cents,
or 20 cents.


Charles Hazlitt Cahan: In Berlin you can exchange the gold reichsmark for enough marks of the other various classes to fill your pocket almost.


James Lorimer Ilsley: At any rate, as I was saying,
importers do not remit in gold marks. They have adopted the practice of purchasing special marks and remitting wholly or partly in those special marks. That is the only way they can carry on any trade with Germany. By this agreement the use of these special marks is to be discontinued, and gold marks or free marks are to be remitted for the purchase of goods. Unless something were done to meet that situation, trade with Germany would be at a standstill. So power is taken to value the reichsmark, the free mark, at less than its current value for duty purposes and dumping duty purposes.
Now let us apply clause (b) to a supposititious ease. Let us suppose that under the power conferred by clause (b) the governor in council proclaims or fixes the rate of exchange of free marks at 32 cents. It still will be necessary for the purchaser, the importer of goods from Germany, to pay the home market value of the goods in Germany if he is to avoid payment of the dumping duty.
Let us suppose that the home market value of a shipment of goods is 1,000 free or gold reichsmarks, gold marks. If we proclaim the value at 32 cents we will be content if the
importer remits $320; he does not have to remit anything more. And we will be content if the exporter of goods from Germany, instead of quoting the home market value of
1,000	marks, in the case I have taken, quotes 800 marks, because then if the importer remits in free marks he will remit at the rate of 40 cents a mark on 800 marks, which will be $320, and thereby avoid payment of dumping duty.
Keeping that case in mind, if hon. gentlemen followed it, I think the application of the section is clear. In cases where, under the power granted by this subsection, the governor in council shall have fixed the rate of exchange for any currency, in computing the value for duty of goods imported into Canada, special or dumping duty shall not apply when the export or actual selling price, which is 800 marks or $320, in the case I mentioned, is equal to or greater than the value for duty so computed; and where the same is less than the value for duty so computed the special or dumping duty applicable shall not be greater than the difference between the export or actual selling price and the value for duty so computed.


Richard Bedford Bennett: Is this not extending a special dumping duty to Germany, a special rate of dumping duty?


James Lorimer Ilsley: I do not know that it is. It
is not a special rate.


Charles Hazlitt Cahan: But it is a rate, and a special rate, because it is a rate fixed under special circumstances. I can understand that section applying to a country where the gold mark is the standard and where its value in Canadian currency is fixed by the exchange. But in this case all legitimate competition in exchange with respect to the value of German marks is non-existent, and the real fact is that the gold reichsmark with which the minister is dealing is a standard of value that is not found in Germany's domestic industry or trade. What I am wondering is how you are to determine the relationship between the reichsmark and the mark which is used as currency in ordinary domestic industry and trade in Germany. There is a new factor here. How are you to fix it?


James Lorimer Ilsley: We do not have to.


Charles Hazlitt Cahan: You cannot apply this or a similar clause without knowing the relationship between the two, unless you are making possible the destruction of Canadian industry with which German industry comes into competition. German industry pays its wages and buys its domestic supplies by one standard, which is not the standard here. It is like using the dollar; you might pay your

Cun toms Tariff-Rate of Exchange
wages and buy yoUr supplies with silver dollars, whereas here you are dealing with golH : dollars, and you are merely establishing a value as between Germany and Canada in international exchange in relation to gold dollars. If the silver dollar, or the depreciated dollar, is used in the currency of Germany for domestic industry and trade, how are you going to establish the relationship between the value of the so-called silver dollar, which I am using for an illustration, and the value of the reichsmark or gold dollar?


James Lorimer Ilsley: Are we not concerned with only one thing, the value for duty? We are concerned with this: what is the value that we will use on which to reckon and collect our duty? That is the first thing. Secondly we are concerned when we have to ask ourselves:	Is this a case where we
should impose the dumping duty? And in that case we have to ask ourselves how much we will insist that the importer shall actually remit in Canadian dollars.


Charles Hazlitt Cahan: How are you to determine that?


James Lorimer Ilsley: Taking the case I put, where we fix the reichsmark at 32 cents, we say that if an importer remits the equivalent of gold reichsmark, he shall remit 32 cents for each mark. That does not mean on the invoice; it means on the home market value.


Charles Hazlitt Cahan: That is what we are getting at, and this is not reichsmark gold. There is no way, as far as I can conceive, of establishing what is the German home market value, for that value is not expressed in the gold reichsmark. I may be very stupid about it, but I cannot conceive how that can be done.


James Lorimer Ilsley: I do not see the difficulty. The hon. gentleman certainly has not made clear to me what would be the difficulty.


Richard Bedford Bennett: The difficulty is that domestic prices are not fixed in terms of the gold mark; they are fixed in terms of the mark with which they pay their wages and carry on their business, which is not the gold mark.


Charles Hazlitt Cahan: This clause evidently must pass, but how the minister or his officials can fix the relative value between the gold reichsmark and one of the eight or ten other descriptions of marks in use in Germany is something I cannot conceive. He can fix a value as between the gold reichsmark and the Canadian dollar, as heretofore, but in doing so with respect to the currencies of other countries he is fixing the value of the

dollar in relation to currencies which are in common use in industry in those countries, and which determine the value for home consumption of the articles produced. How are you going to determine the relationship between your gold reichsmark-


Charles Avery Dunning: There is a constantly
ascertainable relationship in Germany itself.


Charles Hazlitt Cahan: That may be so. Whether
or not that is a fair value or a fair relationship I do not know, but it fluctuates from month to month and oftentimes from day to day, and I am asking how the minister will obtain the necessary data in Canada to fix the ratio from time to time. Will he have an agent in Berlin who will advise him? How will you obtain the information necessary to determine that relationship?


Charles Avery Dunning: The Reiehsbank is dealing in relative values of the two marks, all the time.


Richard Bedford Bennett: That is what the letter
says.


James Lorimer Ilsley: We have officers in Germany who make investigations in that country. I am not sure whether or not they are stationed there.


Richard Bedford Bennett: You have trade commissioners.


James Lorimer Ilsley: Yes. There are fluctuations
from time to time, but how could there be any real difficulty in ascertaining the value of goods in Germany in reichsmarks? The hon. member says they might be sold payable in some other sort of marks, but there would be a relationship between the other marks and the reichsmarks. It would be our duty to find out what is the home market price of the article in Germany in reichsmarks. Then we simply multiply that by the value so fixed, and we have the sum in Canadian dollars. We say to our importers: You must remit that for the article; otherwise you will be subject to dumping duty.


Charles Hazlitt Cahan: I do not wish to press it
further, because I believe I have made my contention clear. I must point out, however, that you are dealing with a country which expresses in marks seven or eight different domestic currencies. No doubt they are currencies differing in value, as to domestic purchasing power and in their value for exchange purposes. Now the difference between any one of those marks and the gold reichsmark which it is necessary for you to determine is a ratio that is not determined by any commercial transactions whatsoever. It is a ratio which is arbitrarily determined by the

Customs Tariff
national bank of Germany which, to all intents and purposes, is the government bank, and which they can change as they see fit, without regard to domestic or international commercial transactions. I am simply pointing out the difficulty which I conceive to exist.


Richard Bedford Bennett: Leaving that for the
moment, and assuming that the government is prepared to accept the responsibility for its action, we come to the next question, that of ascertaining the dumping duty. If I brought in a bill of goods from England which was subject to dumping duty could the minister tell me what I would have to pay. Then tell me what I would have to pay if the same bill of goods were brought in from Germany -both subject to dumping duty?


James Lorimer Ilsley: England is about at par.


Richard Bedford Bennett: No, that is not what I
mean. Duty would be one thing; I would have to pay that on goods from England and from Germany. Then in the one instance I have an excise tax of three per cent, and in the other I do not have it.


James Lorimer Ilsley: Correct.


Richard Bedford Bennett: The next thing is the
dumping duty.


James Lorimer Ilsley: Yes.


Richard Bedford Bennett: What dumping duty, not in value but in terms of formulae applied, would I have to pay for the goods from England, and what on those from Germany?


James Lorimer Ilsley: In the case of goods from
England, you take the difference between the purchase price and the fair home market value of the goods in England. That is collectable in dumping duty.


Richard Bedford Bennett: At what rate is the
dumping duty imposed?


James Lorimer Ilsley: At no rate. It is the
difference.


Richard Bedford Bennett: I just wished to have
that clear. It is just the difference.


James Lorimer Ilsley: Yes, the difference between
the two.


Richard Bedford Bennett: And what in Germany?


James Lorimer Ilsley: Under this arrangement?


Richard Bedford Bennett: Yes.


James Lorimer Ilsley: It would be the difference
between the two, converting German reichsmarks into Canadian dollars at the rate we fix.


Richard Bedford Bennett: Yes, quite; that is all I wanted to know.


[Stage Direction]
Section agreed to.
Richard Bedford Bennett: On division.
Bill reported, read the third time and passed.



WAYS AND MEANS


[Stage Direction]
The house in committee of ways and means, Mr. Sanderson in the chair.
Customs tariff-438c. Ammeters; arm rests and wheel housing lining of indurated fibre, pressed to shape; axle housings, one piece welded, machined or not; carburetors and parts thereof;[DOT] chassis frames and steel shapes for the manufacture thereof; cigar and cigarette lighters, whether in combination with a cigarette holder or not, including base, and parts thereof; control ventilator gear box; cylinder lock barrels, with or without sleeves and keys thereof; dash heat indicators; electric gear shift switches and parts thereof; engine speed governor units and parts thereof; front axle cross channel king pin support section assembly of steel, in the rough; fuel pumps, vacuum pumps and combinations thereof and parts therefor; gasoline gauges and parts thereof; hinges and parts thereof, finished or not, for bodies; horns and parts thereof; instrument bezel assemblies and parts thereof; instrument board lamps; locks, electric ignition, steering gear, transmission, or combinations of such locks, and parts thereof; mouldings of metal, with nails set in position, lead filled or not; oil filters and parts thereof; oil gauges and parts thereof; pipe lines of metal tubing, rigid or flexible, covered or not, with or without fittings, and tubing therefor, for fuel, air, or liquid for actuating hydraulic brakes; purifiers for air, and parts thereof; purifiers for oil, and parts thereof; radiator, hood and other grills, assembled or not, but not polished nor plated, and not to include finish or decorative moulding; radiator ornaments, and hood lift lock ornaments, unplated, and parts thereof; radiator shutter assemblies, automatic; radiator water gauges; radiator shells and parts thereof, not plated nor metal finished in any degree; shackles, bearing spring, and parts thereof; speedometers and parts thereof; spring covers of metal and closing strips or shapes therefor; stampings, body, cowl, hood, fender and instrument board, of metal in the rough, trimmed or not, but not metal finished in any degree; starter switch assembly and parts thereof; steering wheels, rims and spiders therefor; sun visor blanks of gypsum weatherboard; thermostats and parts thereof; throttle, spark and choke assemblies, including buttons therefor, and parts thereof; tire clamping rings of steel, plated or not; universal joint ball assemblies; voltage control regulators; windshield wipers and parts thereof; all of the foregoing when of a class or kind not made in Canada and for use in the manufacture or the repair of the goods enumerated in tariff items 424 and 438a or for use in the manufacture of parts thereof:	British preferential
tariff, free; intermediate tariff, 20 per cent; general tariff, 30 per cent.
(1)	Provided, that if the above articles are imported for use as original equipment by a manufacturer of automobiles, motor vehicles, electric trackless trolley buses or chassis enumerated in tariff items 438a and 424 whose total factory output during the year in which importation is sought does not exceed ten thousand complete automobiles, motor vehicles, electric trackless trolley buses or chassis, and provided that not less than fifty per centum of the factory cost of production of such automobiles.
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[Stage Direction]
motor vehicles, electric trackless trolley buses or chassis, not to include duties and taxes, is incurred in the British empire, the rates of duty under this item shall be: British preferential tariff, free; intermediate tariff, free; general tariff, 25 per cent.
(2)	Provided, that if the above articles are imported for use as oroginal equipment by a manufacturer of automobiles, motor vehicles, electric trackless trolley buses or chassis enumerated in tariff items 438a and 424 whose total factory output during the year in which importation is sought exceeds ten thousand automobiles, motor vehicles, electric trackless trolley buses or chassis, and provided that not less than sixty per centum of the factory cost of production of such automobiles, motor vehicles, electric trackless trolley buses or chassis, not to include duties and taxes, is incurred in the British empire, the rates of duty under this item shall be: British preferential tariff, free; interdemiate tariff, free; general tariff, 25 per cent.
Provided that from and after March 31, 1938, the words "sixty-five" shall be substituted for the word "sixty" in the immediately preceding proviso;
(3)	Provided that the governor in council may make such regulations, if any, as are deemed necessary for carrying out the provisions of this item.
Hon. CHARLES A. DUNNING (Minister of Finance): We are now on item 438c, one of the additional automobile items printed in the votes and proceedings of March 30. When we were in committee before we passed item 438b, as reported upon by the tariff board. The present item is an extension of the list of small parts. Chassis frames and steel shapes for the manufacture thereof, electric gear shift switches and parts thereof, front axle, cross channel, king pin support section assembly of steel, in the rough, vacuum pumps and combinations thereof, are added to the list of parts formerly contained in the item. The rates of duty imposed, as will be seen, are free, 20 per cent and 30 per cent.
Richard Bedford Bennett: Perhaps this would be the proper place to refer to what was said in the report of the tariff board in connection with the automobile inquiry.


Charles Avery Dunning: That was discussed the other evening.


Richard Bedford Bennett: But I was not here. There are some matters which I believe to be of importance. Eliminating everything else in 1936 when the budget was under consideration, I read an extract from the report of the tariff board dealing with the price imposed on copper, brass and things of that kind. I dare say the minister will recall it. I would point out that we Canadians are paying the English price for the goods we use in the manufacture of automobiles, which involves the cost of transport across the Atlantic

ocean and back again. When we were in office we endeavoured to stop this, but we did not succeed. I think we are on the highway to success and I trust the minister will continue to see that he does succeed. I am satisfied that had we been in office until this day we would have succeeded. I must say that I find it difficult to bring my mind to the state where it can accept with equanimity the production of copper and other metals in this country and then when they are used in the manufacture of articles, the Canadian must pay the manufactured price which is maintained in England, which involves the cost of transporting across the Atlantic ocean. I note the report of the board makes some slight reference to this, and states that there has been some improvement in 1936. I think it is high time the improvement was completed.


Charles Avery Dunning: I can only say that I share the views of the leader of the opposition. He did not explain why he failed to attain a full measure of success in his efforts along that line.


Richard Bedford Bennett: I think everyone knows why.


Charles Avery Dunning: It is a difficult thing to work out. This government intends to pursue the path which the right hon. leader of the opposition said did not lead to complete success in his time. I cannot boast of the improvement which has occurred in this connection since we came into office, but there has been some improvement.


Richard Bedford Bennett: We made some improvement and you have made some.


Charles Avery Dunning: We intend to make a further improvement.


[Stage Direction]
Item agreed to.
Customs tariff-438d. Front and rear axles; brakes; clutches; internal combustion engines; steering gears; magnetos; rims for pneumatic tires larger than thirty inches by five inches; transmission assemblies; drive shafts; universal joints; steel road wheels; and complete parts of the foregoing, when of a class or kind not made in Canada, and imported by manufacturers of the goods enumerated in tariff items 424 and 438a for use only in the manufacture of motor trucks, motor buses and electric trackless trolly buses, or for the manufacture of chassis for the same: British preferential tariff, free; intermediate tariff, 17J per cent; general tariff, 27J per cent.
(1)	Provided that if the above articles are imported for use as original equipment for motor trucks, motor buses and electric trackless trolley buses, or for chassis for the same, by a manufacturer of the goods enumerated in tariff items 424 and 438a, and provided also that during the year during which importation is sought, not less than forty per centum of the

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factory cost of production of such motor vehicles and chassis therefor, not to include duties and taxes, is incurred in the British Empire, the rates of duty under this item shall be: British preferential tariff, free; intermediate tariff, 7j per cent; general tariff, 271 per cent.
(2)	Provided that the governor in council may make such regulations, if any, as are deemed necessary for carrying out the provisions of this item.
Charles Avery Dunning: There is no change in the rates. Universal joints and drive shafts are added.


[Stage Direction]
Item agreed to.
Customs tariff-438e. Parts, n.o.p., for automobiles, motor vehicles, electric trackless trolley buses or chassis enumerated in tariff items 438a and 424, not to include wireless receiving sets, die eastings of zinc, electric storage batteries, parts of wood, tires and tubes or parts of which the component material of chief value is rubber:
(1)	Brake linings, and clutch facings whether or not including metallic wires or threads:
(a)	when made from crude asbestos of empire origin: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 35 per cent.
(b)	when made from crude asbestos of nonempire origin: British preferential tariff, 15 per cent; intermediate tariff, 25 per cent; general tariff, 35 per cent.
(2)	Automobile and motor vehicle engines, stripped, n.o.p., and complete parts thereof, n.o.p.: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 35 per cent.
(3)	Parts, n.o.p., not electro-plated, whether finished or not: British preferential tariff, free; intermediate tariff, 30 per cent; general tariff' 40 per cent.
Charles Avery Dunning: It will be noted in some of these items there is an addition of electric trackless trolley buses. This is a new type of vehicle which has had an ever-widening use in Great Britain and on the continent and in connection with which it is desired to make provision in our own tariff.


[Stage Direction]
Item agreed to.
Customs tariff-438f.	Hot rolled strip of
iron or steel with rolled or mill edge, of a class or kind not made in Canada, when imported for use in the importer's own factory, in the manufacture of the goods enumerated in tariff items 424 and 438a, or in the manufacture of parts therefor; per ton: British preferential tariff, free; intermediate tariff, free; general tariff, $8.
Charles Avery Dunning: This reduces the rate on strip iron or steel.


[Stage Direction]
Item agreed to.
Customs tariff-438i. Body bottom cross members and steel shapes for the manufacture thereof; bumpers, front and rear and parts thereof, including spring steel bumper plates; casket tables or platforms for hearses; destination and route sign assemblies, illuminated or not, and parts thereof; direction signals, illuminated or not; door and step mechanism, hand, vacuum or air operated, and parts thereof; door locks and catches and parts thereof; electric switches, buzzers, bells, push buttons, fuse assemblies and parts thereof; forward drive control conversion assemblies and parts thereof; lamps of all kinds, illuminating and indicating, including sockets, flanges, terminals, glassware, lenses and gaskets therefor, assembled or not, but not to include lamp bulbs; metal stampings, oiled and primed or not, and assemblies thereof; rubber fenders; seat operating mechanisms; ventilators, including motor driven fan type, and grills, and parts thereof; window operating mechanisms; all of the foregoing when imported by manufacturers of motor bus bodies, electric trackless trolley bus bodies, motor ambulances and hearses, to be used in the manufacture of such motor bus bodies, electric trackless trolley bus bodies, motor ambulances and hearses, in their own factories: British preferential tariff, free; intermediate tariff, free; general tariff, 20 per cent.
Item agreed to.
Customs tariff-445j. Electric dry shaving machines for use in removing human hair, and complete parts thereof:	British preferential
tariff, free; intermediate tariff, free; general tariff, 10 per cent.
Mr. TAYLOR (Nanaimo):: I suggest that we should have a semicolon in place of a comma after "hair."


Charles Avery Dunning: The word "and" is used.


James Samuel Taylor: But even so I should not like a shaving machine that dug into the roots of the hair.


Charles Avery Dunning: The authorities around me say that the comma indicates parts of the machine and not parts of the hair.


James Samuel Taylor: I do not believe it.


[Stage Direction]
Item agreed to.
Customs tariff-446d. Bottles or cylinders of steel for use as high-pressure containers for gas: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 25 per cent.
Richard Bedford Bennett: The minister realizes that we are dealing with more than the average number of additions made in a budget.


Charles Avery Dunning: These are in the budget items.


Richard Bedford Bennett: I mean it takes time to turn from one to the other to see what one we are dealing with.


Charles Avery Dunning: When we find it necessary to return to the items in the votes and proceedings I shall endeavour to indicate that.


[Stage Direction]
Item agreed to.
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[Stage Direction]
Customs tariff-447b.	Forged steel rolls,
hardened and ground, for use exclusively in rolling ferrous or non-ferrous metals: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Item agreed to.
Customs tariff-449.	Steel wool, including
steel wool impregnated with soap or in retail packages containing a cake of soap: British preferential tariff, free; intermediate tariff, 15 per cent; general tariff, 20 per cent.
Item agreed to.
Customs tariff-451d. Papier mache shoe buttons, shoe eyelets, corset eyelets and corset rivets, shoe eyelet hooks, shoe lace wire fasteners: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Item agreed to.
Customs tariff-462b. Cinematograph and motion picture cameras, 35 mm., for use by professional motion picture producers, having studios in Canada equipped for motion picture production:	British preferential tariff, free;
intermediate tariff, 10 per cent; general tariff, 10 per cent.
Charles Avery Dunning: This is because of a report from the tariff board.


[Stage Direction]
Item agreed to.
Customs tariff-473a. Printing plates of all kinds for periodical publications enjoying second-class mailing privileges, the pages of which are regularly bound, wire-stitched or otherwise fastened together, and matrices, metal bases and copper shells therefor, but not to include printing plates and other articles covered by tariff item 475: British preferential tariff, free; intermediate tariff, free; general tariff, 25 per cent.
Richard Bedford Bennett: When the item numbers are called perhaps the minister will just say what they cover.


Charles Avery Dunning: This covers printing plates for periodicals. This item is a new one which was created under the budget of last session. Prior to that some plates were dutiable at 10, 15 and 20 per cent; others at free, 15 and 20, and the composite rate provided at the last session was free, 74 and 25. The proposal now is to remove the intermediate rate of 74 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-476.	(i) Surgical instruments
of any material and complete parts thereof: British preferential tariff, free; intermediate tariff, free; general tariff, free, (ii) Dental instruments of any material; surgical needles; X-ray apparatus; microscopes valued at not less than 50 dollars each, retail; complete parts of all the foregoing: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 10 per cent.
fMr. Dunning.]
Charles Avery Dunning: This is splitting the item between surgical and dental instruments, and carrying out the terms of the British agreement in that regard.


[Stage Direction]
Item agreed to.
Customs tariff-511. Walking sticks and walking canes, of all kinds; golf clubs and finished parts thereof; skis; racquets and racquet frames and baseball bats; balls of all kinds for use in sports, games or athletics n.o.p.: British preferential tariff, 20 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent.
Charles Avery Dunning: This is reinstating the item after taking out the fishing rods which were previously dealt with.


Richard Bedford Bennett: I am told that we do not manufacture walking sticks in Canada.


Charles Avery Dunning: Not in a commercial way, apparently.


[Stage Direction]
Item agreed to.
Customs tariff-529a. Lace and embroideries, wholly of cotton, not coloured, when imported for use exclusively by manufacturers in the manufacture of clothing, in their own factories: British preferential tariff, 74 per cent; intermediate tariff, 124 per cent; general tariff, 20 per cent.
Charles Avery Dunning: Just deleting the words "by manufacturers"; that is all; extending the privilege of importing so that small users can buy through jobbers under the terms previously only available to manufacturers.


Richard Bedford Bennett: The words "by manufacturers" still remain here. They are not deleted. That is the point to which I wish to direct attention.


Charles Avery Dunning: The former reading was, "when imported by manufacturers." The new wording is, "when imported for use exclusively by manufacturers." This is to assist small manufacturers who could not buy in sufficient quantities as long as it was restricted to manufacturers only.


[Stage Direction]
Item agreed to.
Customs tariff-530. Lace and embroideries, wholly of cotton, coloured, when imported for use exclusively by manufacturers in the manufacture of clothing, in their own factories: British preferential tariff, 74 per cent; intermediate tariff, 174 Per cent; general tariff, 30 per cent, and 4 cents per pound.
Charles Avery Dunning: That is the same thing, exactly.


[Stage Direction]
Item agreed to.
Customs tariff-532. Clothing, wearing apparel and articles made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly of cotton, n.o.p.;

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fabrics wholly of cotton, coated or impregnated, n.o.p.: British preferential tariff, 25 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent, and 4 cents per pound.
Charles Avery Dunning: A reduction of the intermediate rate on manufactures of cotton, including wearing apparel.


Richard Bedford Bennett: The specific duty is taken off?


Charles Avery Dunning: The specific duty is removed from cotton wearing apparel.


Richard Bedford Bennett: A cent and a half a pound.


[Stage Direction]
Item agreed to.
Customs tariff-534. Braided wick for candles or tapers, with or without core, processed or not:
(a)	Imported by manufacturers of wax candles or tapers for use in their own factories in the manufacture of wax candles or tapers: British preferential tariff, free; intermediate tariff, free; general tariff, free.
(b)	Imported, under such regulations as the minister may prescribe, for use exclusively in oil-burning sanctuary lamps: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Charles Avery Dunning: A rewording of two items only.


[Stage Direction]
Item agreed to.
Customs tariff-556b. Slipper cloth, woven, napped on one or both sides, wholly or in part of wool, not to contain silk or artificial silk, weighing not less than 22 ounces per squire yard, when imported by manufacturers of indoor footwear, to be used exclusively in the manufacture of such articles in their own factories:	British preferential tariff, free;
intermediate tariff, 35 per cent; general tariff, 40 per cent and 35 cents per pound.
Charles Avery Dunning: This removes the specific duty under the intermediate tariff.


[Stage Direction]
Item agreed to.
Customs tariff-558c. (ii) Silk yarns wholly or partially covered with metallic strip, one pound of which shall contain not less than 10,000 yards: British preferential tariff, 124 per cent; intermediate tariff, 224 per cent; general tariff, 25 per cent.
Charles Avery Dunning: This is silk tinsel thread, and is a reduction on all rates.


[Stage Direction]
Item agreed to.
Charles Avery Dunning: Now, Mr. Chairman, if members of the committee will take up Votes and Proceedings of March 30, page VI, we come to other resolutions based upon the tariff board report, items 569 (i) and (ii) and 569b.
Customs tariff-569.	(i) Hats, hoods and
shapes of fur felt or of wool-and-fur felt, under such regulations as the minister may prescribe: British preferential tariff, 224 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent.
Customs tariff-569.	(ii) Hats, hoods and
shapes of wool felt: British preferential tariff, 224 per cent and 45 cents per dozen; intermediate tariff, 30 per cent; general tariff, 35 per cent, and $1.25 per dozen.
Customs tariff-569b. Hat sweats, cap peaks, stiffening bands for the inside of hats and caps, hatters' tips and sides when cut to shape, imported by manufacturers for use exclusively in the manufacture of hats and caps in their own factories: British preferential tariff, free; intermediate tariff, free; general tariff, free.


Charles Avery Dunning: There is a reduction in
duty on these items following the report of the tariff board. Item 569 (i) deals with hats, hoods and shapes of fur felt or of wool-and-fur felt, under such regulations as the minister may prescribe. Item 569 (ii) deals with hats, hoods and shapes of wool felt; and 569b, hat sweats, cap peaks, stiffening bands for the inside of hats and caps, hatters' tips and sides when cut to shape, imported by manufacturers for use exclusively in the manufacture of hats and caps in their own factories. Those are the three items.


Robert John Deachman: What is the rate on
hoods and shapes?


Charles Avery Dunning: The present rate.


Robert John Deachman: And the proposed rate?


Charles Avery Dunning: We show present and
proposed rates in the Votes and Proceedings. Do I understand the present rates are asked for?


Robert John Deachman: Both present and past.


Charles Avery Dunning: On item 1 the present
rate is British preference, 22J per cent, which is identical with the new rate; the only change is using the word "fur" for the word "hair"- a matter of description.


Richard Bedford Bennett: Make the fur fly if it
is going to make the hair fly.


Charles Avery Dunning: Yes. My hon. friend
from Huron North intends to make the fur fly. In the second item the specific duty is reduced from 75 cents to 45 cents; intermediate duty, specific is reduced from $1.25 to 90 cents; and the general remains the same in specific duty on that item. In 569b the present rates are 12J per cent, 25 per cent and 30 per cent, and they are made free across the board.


Robert John Deachman: I should like to know the ad valorem equivalents of the item dealing with hats, hoods and shapes of wool felt, under the three tariff classifications.

27S6
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Charles Avery Dunning: The tariff board report
does not work it out precisely in the manner that my hon. friend asks for, but I think that this quotation from page 16 of the tariff board report may satisfy him.
The English hood mentioned in the table as landing in Canada at $4, corresponds in weight with a Canadian hood quoted at $4.10.
The Canadian manufacturers of wool felt hoods pointed to the Japanese situation in justification of the present rates of duty under the intermediate tariff. But there were practically no importations of wool felt hoods into Canada during 1936. It would seem that the prevailing rate of duty, together with the proclaimed valuation of the yen over the current rate of the yen, prevented any importations from Japan, but Japan is apparently ready to export since her exports to the United States increased from 288,855 dozen in 1935 to 639,871 dozen in 1936. The board has information to the effect that the largest manufacturer of wool hoods in Japan sells wool felt hoods (2J ounce weight) for $1.41 per dozen. These hoods can be landed in Canada at approximately $3.75.
Taking that Japanese value in Japan, it is quite conceivable that if we applied the ad valorem and specific to it in order to get the average incidence it might be even one hundred per cent, though with respect to other countries producing the same article there is a very much lower duty.


Robert John Deachman: I have gone over the report carefully because it seems to me to reveal an amazing tariff against which I wish to protest. As I work out this reduction, the minister was quite right. The rate now proposed means 37 per cent against Great Britain, 85 per cent against Italy, and something like 125 per cent against Japan. On one occasion it was suggested that I was a free trader. Well, items like these would make almost anyone on earth a free trader. I recall very clearly hearing the Prime Minister say in this house, in answer to a challenge from the other side to the effect that trade was war, that trade was not war but the exchange of commodities. With that in mind I proceeded to work out the results of the exchange of certain Canadian products for these hats, hoods and shapes. Suppose we want 100 dozen of these articles and buy them from a Canadian manufacturer at the price made possible by the tariff. We have to give in exchange 400 bushels of wheat. Under free trade, if we were permitted to import these goods from England, we should give 270 bushels of wheat, and if we imported them from Italy, 180 bushels.


Charles Avery Dunning: At what price are you taking wheat?


Robert John Deachman: One dollar a bushel.


Charles Avery Dunning: Oh well.


Robert John Deachman: 
Richard Bedford Bennett: How many people does it employ?


Robert John Deachman: That is what I should very much like to know, but we are not permitted to know these things. I contend that when we have a tariff, at whatever rate, which is not a revenue tariff, when the government brings in a request for an increase in that tariff it ought in all fairness to give the number of men employed, the wages, and the amount of Canadian raw material used.
My understanding is that in this industry the raw material comes from England; there is practically none purchased in Canada. Yet here we have an industry carrying a colossal tariff of 85 per cent under the intermediate tariff, and we are asked to support an item of such proportions. The same thing was clearly told in the previous report of 1935. The plea at that time was to give it another two years. Now in 1937, after we have had this industry for six years, they say: Give it another two years. Just as we have industries established in Canada fifty or sixty years ago still pleading for more and more tariff. When are we to escape from this eternal cry for more?
Here are some of the things we are losing. We pay more in extra prices than is paid in wages. We have destroyed a market, because imports are payments which we receive for exports, and unless we are going to buy, how can we hope to sell? We destroy the home market by raising the price of the product above the level at which exchange will take place. Let me put it the other way; when we raise the price of a product to a point which is far above the natural level for that product, then those who are producing a product which is sold in the open markets of the world cannot exchange it for that product, and consequently what we have done is to destroy the home market.
31111-176}
After all, what are these hats and shapes? They are the raw material of the hat industry in Canada. When you have raised the price, what have you done? You have injured another industry vastly more important than this industry. I appeal to the government, I ask them to do this, I think it is only fair. This item ought to be referred back to the tariff board. I would rather that were done than the item left with the amazing tariff which now stands. Let it stand as a great Aconcaguan peak telling us how stupid we have been in regard to the tariff in the past.


Richard Bedford Bennett: Why not quote Everest?


Robert John Deachman: Everest will do just as well, or one of the peaks in the Canadian Rockies. I just took one in South America because I thought we might develop a little trade down there. I appeal to my hon. friend to send this back to the tariff board. Or in the alternative I make this appeal: He knows the rate is too high, no one in the world knows that better than the Minister of Finance (Mr. Dunning); there is not a man within range of any voice who does not know that 85 per cent is an outrageous tariff, no matter who put it on. It is none the less so when it happens to be put on by those who have sometimes stood shoulder to shoulder with me in the fight for lower tariffs at election times-


Richard Bedford Bennett: Yes, that is in election times.


Robert John Deachman: I realize how difficult it is for any private member to make a successful appeal to the government to do something in regard to these things. I think there is only one time in all history when that was done. I refer to the time when Cobden was making his appeal in the House of Commons in England and Sir Robert Peel crumpled up his notes, and turned and said to Sydney Herbert sitting behind him "You answer that because I cannot." I am not suggesting that I am a Cobden in this case, nor do I think I am facing a Sir Robert Peel, but I do appeal to the minister: Here is an opportunity to show the faith that should be in us. We ought to do something in regard to this item.
I have a far higher appeal that I am going to present to my hon. friend. I am sorry the Prime Minister is not here. I would appeal to him to take action on this, because it is in exact accordance with the promise made by the Prime Minister on the night following the election. Let me read this:
The election is an unmistakeable verdict in favour of the liberation of external and internal trade.
In this case we have destroyed internal trade because we have destroyed the capacity
Customs Tariff

to buy, and with that we deny to the Canadian people the right to sell their product in the highest market and get the best value they can for it. The Prime Minister went on:
It constitutes a demand for the abolition of the extravagant increases in the tariff, together with the removal of arbitrary taxes and regulations, as imposed by the present administration, which have had the effect of strangling the commerce of the nation-


Charles Avery Dunning: I hope Hansard will do the Prime Minister the justice of not attributing to him the interpolations of my hon. friend.


Robert John Deachman: I was careful to show what was quotation. This copy will be given to Hansard.
-strangling the commerce of the nation, exploiting consumers, and robbing railways of business.


Richard Bedford Bennett: Quotation marks!


Robert John Deachman: Now surely, Mr. Chairman, the proposal I make is a fair one. I do not think there is anything to justify a tariff of 85 per cent, but I know one answer that is sometimes made, and I shall finish with that. Sometimes it is said "Oh well, we have got to beware. Strange things are happening in Japan. Some time Japan may suddenly flood us with a great avalanche of stuff and we shall not know what to do when we wake up in the morning and find everything we need lying all around the house. Since, I think, 1858, when the gates of Japan were opened to the trade of the world, in all that period of time Japan has been sending her products into the markets of the world, and in all that time Japan has bought back dollar for dollar. When she sold products abroad, she bought back an equivalent volume of products from the countries of the world. It does not necessarily follow that she would buy from Canada, but she would buy from some country, and I submit that when there are goods to be shipped to the countries of the world from Japan, Canada will get her share.
What would happen to-morrow supposing by some miracle Japan were able to increase her production ten times? Would we be ruined? Would the nations of the world be ruined? No, because Japan would have to buy ten times as much. If she increased her exports ten times, she would have to buy back ten times the present volume, and if our trade increased correspondingly we would be buying $40,000,000 worth from Japan and selling her $190,000,000 worth. My hon. friend shakes his head, but if we could increase our markets to that extent our unemployment problf'n would be solved, and there
[Mr. Deachman.}
would be no other great problem to settle for Canada, for that is the primary and outstanding problem. I make this appeal to my friend the minister to-night: Will he at least do this, bring that duty down to a point which can be considered reasonable, and not leave it at the appalling height of 85 per cent? A tariff proposed by Liberals for the purpose of opening up the markets of the world and expanding trade, and there it stands-at 85 per cent!


Richard Bedford Bennett: No cheers from the other side.


Charles Avery Dunning: My responsibility is evidently a great one in connection with what is, after all, rather a minor item. We should place things in their proper perspective. In the first place, lest there should be an inclination on the part of members of the committee or those outside of this house to believe that there is a duty of 85 per cent or 185-I forget which my hon. friend said-on *all hats and shapes, I call the attention of the committee to the first item now under discussion, on which the rate under the British preference is a straight ad valorem of 22^ per cent, intermediate 30 per cent, and general tariff 35 per cent.
With respect to the second item, upon which my hon. friend founded his argument, I think it is essential that this committee should look at this industry in the manner that the government had to look at it in reaching a decision whether or not the reductions advised by the tariff board should be proposed to this house. It becomes important in the light of what we have just listened to. But mark that what is proposed is a material reduction as compared with the existing tariff. This industry started in Canada only a few years ago, one plant I believe in 1931 and another in 1932. At that time, by means of fixed valuations under section 43 of the customs tariff, rates of tariff were created in connection with the industry, but the government of the day referred to the tariff board the question relating to this industry. In 1935 the tariff board reported as to what it believed at that time was the tariff necessary, and in that report, as my hon. friend from Huron North has said, indicated that the rates proposed should be reviewed again within two years and that the valuations under section 43 should cease.
Reference was made to the tariff board again in two years, and the reductions here proposed are the result of the further hearing in connection with this item, 569 (ii), which

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took place last summer. Again I quote from paragraph 8 of the report of the board, appearing at page 23:
The board's suggestions as to the reductions of duties in the light of facts found are based . on the assumption that a further period of, say, two years will he given to the industry in which to demonstrate that it will be ready and able to accept reductions of duties to rates more in line with those existing generally in respect of semi-manufactured goods. If effect is given to the board's findings the reduction in the effective protection under the intermediate tariff will be, in view of the conditions mentioned in paragraph (6) of this summary, the full amount of the reduction proposed in a specific duty; under the British preferential tariff where the increase in wool costs operates in favour of the Canadian manufacturer the increase of 25 cents per dozen for wool hoods in 1937 as against the same article in 1936 amounts to an increase . . .
Then paragraph 9:
The evidence submitted satisfies the board that the price paid by the consumer in Canada for hats of wool felt is substantially the same as is now paid in other countries which would ordinarily be compared with Canada. Competition in the completed hat is very keen and retail prices are low.
I read that extract in order to complete the story of this industry. The government, then, was faced with the question whether it should accept this further report of the tariff board, which was the second successive report within two years recommending a reduction in the effective rates of duty on this class of goods -whether it should accept the report on the basis that further examination, looking to an additional reduction, should be made within another two years, or whether it should say "No. We will reduce the duty to a degree that will satisfy the hon. member for Huron North, being certain that in so doing the industry as it now operates, so far as that branch of it covered by 569 (ii) is concerned, will cease to exist."
I suggest _ to this house that I am not making a high protectionist argument when I say that having regard to the progressive reductions which have been effected it is reasonable to accept the report of the board, to bring about these further reductions and look for additional reductions two years from now. That is the view of the government; that is why the government brings this item before the house in this shape.


Richard Bedford Bennett: What is the production?


Charles Avery Dunning: In 1935 there were 206,000 dozen wool felt hoods manufactured in Canada, with a value of $793,000. As near as I can get the imports, in 1936 they amounted to 20,600 dozen, worth $37,000. It must be
remembered that the imports in 1936 were under the tariff as it has prevailed up to the present time.
I am making no argument on broad general principles whatever; I shall not attempt to compete with my hon. friend along that line. Here the government had to face a practical problem, of which I have given the history. Shall we say here to-night, "Yes, we will reduce the tariff further, and you can expect it to be reduced still more in two years," or shall we say to-night, "No, we will not accept the report of the tariff board. We will reduce the rates even more, knowing that in so doing we are preventing this branch of the industry from operating?" I have no doubt as to the facts, after looking into the matter somewhat carefully, and the government have decided to accept the present step by way of reduction, with the clear understanding that it is a step.


Robert John Deachman: There is one further question I should like to ask. Of course, my hon. friend knows that the board clearly stated that in its opinion this was not an economic industry and that money must be taken from the pockets of the Canadian people to pay for it. The facts are available to my hon. friend, not to me, so would he be good enough to let us know what are the wages paid in this industry in order that we may have some idea of how much it is costing us to establish this industry in the Dominion of Canada?


Charles Avery Dunning: Any information I could give my hon. friend in that regard would not be fair to the item under discussion for the reason that the only information that would be available from our records would be the wages for the whole industry, not merely that part of it which operates under item 569 (ii). There are only three firms, and I am afraid that my hon. friend would have a right to accuse me of misrepresentation if I obtained for him the wage figures applicable to the whole industry and then attempted to relate them to this one item. I do not think that would be fair. I have not the figures here in any event.


Robert John Deachman: Can we go one step further, because to me this is more or less a test ease-


Charles Avery Dunning: Let me assure my hon. friend that with me it is not a test case at all. I just want to make that clear.


Robert John Deachman: Very well; I will consider that view, but I have a different view. We have in Canada many of these industries where the tariff rate is far above the total
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percentage of wages paid in the industry; that is, where the tariff rate may be forty or fifty per cent and the wage cost is probably only twenty-five per cent. I have a suggestion to make to my hon. friend, and I do not think it is too much to ask. No doubt the tariff board will be watching this industry, or it ought to be because it is one of our economic leaks, and I think they should examine it sufficiently to let us have next year the actual wage cost so that we may have an idea of what the people of Canada paid during the year in order to keep this industry on its very unstable feet.


[Stage Direction]
Items agreed to.
Customs tariff-577. Collars and cuffs manufactured from cellulose plastics with or without cotton interlining: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 25 per cent.
Item agreed to.
Customs tariff-588a. Gas for heating, cooking or illuminating, imported by pipe line, per one thousand cubic feet: Intermediate tariff, 6 cents; general tariff, 6 cents.
Charles Avery Dunning: In the old schedule there was no rate under the intermediate tariff.


[Stage Direction]
Item agreed to.
Customs tariff 604b. Sole leather: British preferential tariff, 124 per cent; intermediate tariff, 274 per cent; general tariff, 274 per cent.
Charles Avery Dunning: This is the residue of an item dealt with in the British agreement.


Richard Bedford Bennett: It leaves the same rate, does it not?


Charles Avery Dunning: Yes.


[Stage Direction]
Item agreed to.
Charles Avery Dunning: I have one resolution of which I have not given notice. It is to rectify a minor error in dealing with the British agreement, and makes a downward revision in the item with which it deals, but brings it into conformity with the agreement. I will read it.
607 (part 2). Leather consisting of beef-cattle hides, horse-hides or sheep-skins, but not including suedes, cabrettas, Spanish capes or African capes, when imported by manufacturers of gloves or leather clothing, for use exclusively in manufacturing gloves or leather clothing, in their own factories: British preferential tariff, free; intermediate tariff, 15 per cent; general tariff, 20 per cent.
The British preferential rate is free, and the other two are unchanged.


Richard Bedford Bennett: The rates are fifteen and twenty?


Charles Avery Dunning: Yes.
[ITi*. Deachman.]


James Lorimer Ilsley: I move:
That schedule A of the customs tariff as amended by resolution No. 2 of February 25, 1937, be further amended by striking thereout tariff item 607 (part 2), and by inserting in lieu thereof the following item, enumeration and rates of customs duties.
"607 (part 2). Leather consisting of beef cattle hides, horse hides or sheep skins, but not including suedes, cabrettas Spanish capes or African capes, when imported by manufacturers of gloves or leather clothing for use exclusively in manufacturing gloves or leather clothing in their own factories: British preferential tariff, free; intermediate tariff, 15 per cent; general tariff, 20 per cent.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-607a. Leather, not further finished than tanned, in whole hides, in grains, or splits, when imported by manufacturers of upholstering leathers, for use exclusively in the manufacture of upholstering leathers, in their own factories: British preferential tariff, free; intermediate tariff, 15 per cent; general tariff, 15 per cent.
Charles Avery Dunning: There is a change in wording, but not in rates.


[Stage Direction]
Item agreed to.
Customs tariff-612. Harness and saddlery, including horse boots, n.o.p.: British preferential tariff, 17J per cent; intermediate tariff, 274 per cent; general tariff, 30 per cent.
Richard Bedford Bennett: It is just a change in wording, is it not?


Charles Avery Dunning: Yes, just the addition of n.o.p. It arises from the English saddles being given a special item.


[Stage Direction]
Item agreed to.
Charles Avery Dunning: The tariff items 616 to 616e inclusive are the result of a report of the tariff board which I tabled earlier, before the budget was presented. This is a downward revision of the hard rubber schedule.
Customs tariff-616. Rubber, crude, caoutchouc or India rubber, unmanufactured; powdered rubber and rubber or gutta percha waste or junk; and recovered rubber and rubber substitute: British preferential tariff, free; intermediate tariff, free; general tariff, free.


[Stage Direction]
Item agreed to.
Customs tariff-616d. Hard rubber, in strips or sheets not less than one-sixteenth of an inch in thickness, or in rods or tubes, but not further manufactured:	British preferential
tariff, free; intermediate tariff, 15 per cent; general tariff, 20 per cent.
Item agreed to.

Customs Tariff
Customs tariff-616e. Hard rubber, in strips or sheets less than one-sixteenth of an inch in thickness, but not further manufactured: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Item agreed to.
Customs tariff-618a. Comb blanks of hard rubber, not further manufactured than pressed and vulcanized, when imported by manufacturers of hard rubber combs, for use exclusively in the manufacture of hard rubber combs, in their own factories: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Charles Avery Dunning: The rubber comb blanks are dealt with in the same report.


[Stage Direction]
Item agreed to.
Charles Avery Dunning: In connection with the rubber schedule I have a minor amendment which will give a little opportunity for industrial development. This will be item 618c.


James Lorimer Ilsley: I move:
That schedule A to the customs tariff, as amended by resolution No. 2 of February 25, 1937, be further amended by inserting therein the following item, enumeration and rates of duty:
Customs tariff-618c. Chlorine derivatives of india-rubber insoluble in carbon tetrachloride, in sheets not exceeding two one-thousandths of an inch in thickness, coloured or not but not printed, lithographed or embossed, when for use in Canadian manufactures:	British
preferential tariff, free; intermediate tariff, 5 per cent; general tariff, 20 per cent.
This resolution, is to provide a lower rate on a new product now being widely used in the United States for wrapping purposes. It is a fabric which has been developed from pure rubber. It is said to be waterproof, sheer, transparent, and odorless, and protective coverings made from it are meeting with a wide sale in connection with those products with which it is used.


Richard Bedford Bennett: It is a competitor of cellophane, except that it is waterproof.


Charles Avery Dunning: It is superior in certain fields, and not as good in other fields.


Richard Bedford Bennett: It is a waterproof commodity.


Charles Avery Dunning: The owners of the patent in the United States contemplate the immediate establishment of a factory in Canada, to manufacture shower curtains etcetera, of this fabric, which at present is not made in Canada. There is no rate for the fabric at the present time, and it would fall under the general item of 15 per cent, 25 per cent and 27^ per cent. In view of the possibility of a wide development in the use of the material, the change is proposed.


Richard Bedford Bennett: What are the proposed rates?


Charles Avery Dunning: They are free, five and twenty.


[Stage Direction]
Motion agreed to.
Item agreed to.
Customs tariff-624.	Bead ornaments and
ornaments of alabaster, spar, amber, terra cotta or composition; fans of all kinds; statues and statuettes of any material, n.o.p.: British preferential tariff, 20 per cent; intermediate tariff, 27i per cent; general tariff, 30 per cent.
Charles Avery Dunning: This is an addition of the n.o.p., on account of the arrangement respecting statuettes.


[Stage Direction]
Item agreed to.
Customs tariff-652. Toilet or dressing combs, n.o.p.; fancy combs, not being jewellery: British preferential tariff, 10 per cent; intermediate tariff, 25 per cent; general tariff, 27i per cent.
Richard Bedford Bennett: This is a combination of many items.


Charles Avery Dunning: Item 652 arises out of a tariff board report with respect to combs, and brings at least three items under one head. The rates proposed constitute a reduction in connection with the British preference of from 20 per cent as the highest rate in the former item and 15 per cent as the low rate, to a new rate of 10 per cent; under the intermediate tariff, a reduction from the highest rate of 32J per cent and a low rate of 25 per cent to a uniform rate of 25 per cent; and under the general tariff a reduction from the highest rate of 40 per cent and a low of 25 per cent to a general rate of 27i per cent.


[Stage Direction]
Item agreed to.
Charles Avery Dunning: It will be remembered that last year we made provision for mouthpieces of hard rubber and parts of pipes and mountings, meaning pipes that one smokes Last year these were made free under th( British preferential but left at 7\ per cent under the intermediate. Since that time it has developed that the industiy which commenced making pipes from imported parts has found it impossible to secure suitable parts for the trade from Great Britain. Accordingly they made application to have an opportunity of utilizing parts from other countries to be brought in under the intermediate tariff. The present proposal is to make these parts free under the intermediate. The item will read:
Customs tariff-657. Mouthpieces of hard rubber in the rough, aluminum pipe fitments, pipe bowls moulded from briarwood dust, and briarwood bowls not further processed than frazed, when imported by manufacturers of tobacco pipes for use exclusively in the manufacture of such pipes in their own factories.
Customs Tariff


Ian Alistair Mackenzie: I move the item, Mr. Chairman.


[Stage Direction]
Item agreed to.
Customs tariff-690a. Casual donations sent by persons abroad to friends in Canada, or brought into Canada personally by non-residents as gifts to friends, and not being advertising matter, tobacco or alcoholic beverages, when the value thereof does not exceed five dollars in any one case, under such regulations as may be prescribed by the minister: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Charles Avery Dunning: This item was mentioned in the budget. It widens the principle with regard to casual donations.


[Stage Direction]
Item agreed to.
Customs tariff-693.	(i) Articles imported
by or for public museums, public libraries, universities, colleges or schools, and which are to be placed in such institutions as exhibits, under regulations prescribed by the minister: British preferential tariff, free; intermediate tariff, free; general tariff, free.
(ii)	Violins, violas and violoncellos, manufactured more than 100 years prior to date of importation, under such regulations, including proof of antiquity, as may be prescribed by the minister: British preferential tariff, free; intermediate tariff, free; general tariff, free.
(iii)	Antiquities (other than spirits or wines)
produced more than 100 years prior to date of importation, under such regulations, including proof of antiquity, as may be prescribed by minster:	British preferential tariff, free.
Provided that, notwithstanding anything to the contrary in this Act or in any other law or regulation relating to Customs, antiquities as described in part (ii) of this item shall, for entry thereunder, be relieved from the requirement as to origin or British Empire content.
Charles Avery Dunning: This is the antique item which was referred to in the budget. I am sure it has been studied by hon. members since that time. I can give the details at great length if desired.


[Stage Direction]
Item agreed to.
Custom tariff-709.	(a) Goods, including
containers or coverings as specified in part (b) of this item, the growth, produce or manufacture of Canada, after having been exported therefrom: British preferential tariff, free; intermediate tariff, free; general tariff, free.
(b) Bags, barrels, bottles, boxes, carboys, cartons, casks, crates, cylinders, drums, tarpaulins and other usual containers or coverings, n.o.p., filled or empty, and impact registers or recorders for use in railway cars, upon which duty has once been paid: British preferential tariff, free; intermediate tariff, free; general tariff, free.
All the foregoing under such regulations as the minister may prescribe;
Provided that the goods are returned to the exporter thereof within five years from the time

of exportation, without having been advanced in value or improved in condition by any process of manufacture or other means, or combined with any other article abroad;
Provided also that any goods described in this item, upon which an allowance of drawback has been made, shall not be admitted to entry thereunder except upon payment of duties equal to the drawback allowed;
Provided further that any of such goods manufactured in bond or under excise regulations in Canada and exported shall not be admitted to entry except upon payment of the customs or excise duties to which they would have been liable had they not been exported from Canada.
Charles Avery Dunning: This is a rewording in order to meet difficulties of administration. There is no change in the rates.


[Stage Direction]
Item agreed to.
Charles Avery Dunning: I intend to move a resolution to create a new item upon which I shall give a little information. This is to provide free entry under all tariffs for cocoa residues used in the manufacture of bromides and caffeine. There is a considerable demand in industry for caffeine and caffeine products, and the attempts of the Canadian chemical companies who cater to these requirements has found reflection in recent budgets presented to this house. In the budget of 1934 provision was made for the free entry of crude bromide. In the budget of 1936 free entry was provided under the British preferential for tea dust and sweepings when imported for use in the manufacture of caffeine. Under the new item free entry is granted to cocoa residues for use in the manufacture of bromide or caffeine.


James Lorimer Ilsley: I move the item accordingly, Mr. Chairman.


[Stage Direction]
Item agreed to.
Customs tariff-306d. Ornamental or decorative marble (not including chips), unicolour or variegated, of colours and/or texture not produced in Canada, rough, hammered, sawn, sand rubbed, chiselled or polished, with or without design thereon, when specially imported and used for interior work in churches and public buildings, not to include buildings operated for commercial purposes or for private gain or profit: British preferential tariff, free; intermediate tariff, free; general tariff, 35 per cent.
Charles Avery Dunning: The hon. member for Greenwood (Mr. Massey) sent me a note tonight asking that we revert to item 306d. As a matter of fact, a great many representations have reached me with respect to this marble item. It will be remembered that this item was before the committee the other evening and I indicated that a reduction was being made in order to overcome the difficulty which

Customs Tariff
had been experienced for years by the Department of National Revenue through churches applying for the remission of the duty on Italian marble when used in the construction of churches.
Mr. .BENNETT: For interior use.


Charles Avery Dunning: Interior use in churches. The Department of National Revenue represented to me that it was very undesirable to continue an item in the customs tariff and then constantly make it inoperative by remissions of this character. In the wording of the item the words "and public buildings" are used. It has been thought a little unfair to make the free entry so broad, and I am going to ask my colleague to move that customs tariff 306d, as contained in resolution two of February 25, be amended by striking out all the words after "churches".


Denton Massey: 
Charles Avery Dunning: The first amendment is to item 377e.
Customs tariff-377e. Wrought iron in the form of billets, bars, rods, sheets, strips, plates or skelp: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 30 per cent.
It will be seen from page 17 of the ways and means resolutions that previously the rates were $2.50 and 15 per cent under the British preferential; $4.50 and 25 per cent under the intermediate, and $4.50 and 30 per cent under the general. The proposal is to make the rates free, 20 per cent and 30 per cent. The resolution which I am now proposing will confine the change to the British preferential and will thus preserve the present situation with regard to the other countries.


James Lorimer Ilsley: I move accordingly.


Richard Bedford Bennett: I do not think the minister used the words he intended to use.


Charles Avery Dunning: I propose to confine the operation of this item altogether to the British preferential column and to leave the others blank.


Richard Bedford Bennett: Here is the item as submitted to the committee:
377e. Wrought iron in the form of billets, bars, rods, sheets, strips, plates or skelp.
British preferential free, 20 per cent intermediate, 30 per cent general tariff.
Then in the column on page 17 marked " present rates " we have: British preferential -that is, before this budget the other day- $2.50 a ton and 15 per cent; intermediate $4.50 a ton and 25 per cent; general, $4.50 a ton and 30 per cent. If it means anything the language of the minister indicates that we are going to abandon the 20 per cent and 30 per cent and return to $4.50 a ton, plus 25 per cent and 30 per cent. That is what it must mean. To raise in that way an item after it has been submitted to the house is somewhat strange, unless there is an explanation of it.


Charles Avery Dunning: The item is a new one, extracted from what would formerly be, I think, nine. I am advised we found fifteen items under which wrought or puddled iron enters at present. By reason of the peculiar development of that industry the British were anxious to have a rate which covered wrought or puddled iron in the form of billets which we do not recognize otherwise in the tariff and which we do not make in Canada. An effort was made in the rate which is quoted in the first three of the columns to evolve this composite item; but unfortunately, on ascertaining where the bearing would lie, it was found

Customs Tariff

that those rates of 20 per cent intermediate and 30 per cent general would have the effect of raising the tariff against other countries in connection with some of the items into which wrought iron or puddled iron in the form of billets, bars and rods would fall. So we are making a special item of wrought iron only for Great Britain, so that when wrought iron now enters from any other country it will fall under any one of the fifteen other classifications of tariff into which that particular item would enter. We think that is the best solution; otherwise we would have to evolve a complete wrought iron schedule for the whole tariff, and there is no need for it except with respect to imports for Great Britain. That, I think, is the explanation.


Richard Bedford Bennett: It does not get away from the fact that we are now increasing the tariff on this item compared with what was submitted to the house when the budget was brought down.


Charles Avery Dunning: In some cases it would be an increase, and in some a decrease.


Richard Bedford Bennett: We might as well look
at it. On page 17 of the resolutions, 377e, I see that wrought iron comes in free under the British preference and at 20 and 30 per cent under the intermediate and general tariffs respectively, and that the rate that is replaced was the rate of S4.50 a ton and 25 per cent and 30 per cent respectively under the intermediate and general tariffs. We are now going back to that rate, or else whoever wrote that item certainly misled this committee. There can be no option as to that view.


Charles Avery Dunning: I am sorry I do not
follow the right hon. gentleman.


Richard Bedford Bennett: The officials of this
department, who supposedly know what they are talking about, stated that the existing rate on wrought iron in the form of billets and bars and rods, and so on, was $450 a ton and 25 per cent under the intermediate tariff, and $4.50 a ton and 30 per cent under the general tariff. They put that down in black and white and handed it to us, and upon that information we arrived at our conclusions. They said that the British preferential rate was $2.50 per ton and 15 per cent. They said: We propose to make that free under the British preference and reduce the rates under the intermediate and general tariffs to 20 per cent and 30 per cent respectively. Tonight we are told that the 20 per cent disappears and the 30 per cent disappears- in face of which surely it must go back to what officials said was the rate, namely $4.50
(Mr. Dunning.]
per ton and 25 per cent and 30 per cent respectively under the intermediate and general. There cannot be any doubt about that, can there?


Charles Avery Dunning: In a measure that is
correct, in that instead of quoting merely two former rates there should Lave been quoted at least ten, -and very possibly fifteen. I will give my right hon. friend one illustration of what I mean by saying that our original proposal in the budget had an effect we did not foresee, in that it actually increases the rate materially. The item I have in mind is the skelp portion of the item.


Richard Bedford Bennett: That is what I thought.


Charles Avery Dunning: As my right hon. friend
will remember, formerly under the intermediate, skelp came in at 5 per cent.


Richard Bedford Bennett: It is the raw material
of the pipe manufacturers.


Charles Avery Dunning: Exactly; and we would
have raised that, by the action originally proposed, to 20 per cent.


Richard Bedford Bennett: Quite.


Charles Avery Dunning: That was not our intention; and in so far as there was an error by the officials of the department in not expanding the second set of three columns sufficiently I must take responsibility for it. I should say that on the whole there are very, very few such errors, having regard to the very complex nature of this whole document, and I apologize.


Richard Bedford Bennett: It is not necessary for
the minister to do that. But frequently we have had three, four and five rates set out in the intermediate and general, but only two are set out here, and to that extent it is a misleading item. I quite appreciate what the hon. gentleman says, because I think many of us have received communications as to the application of that 20 per cent rate to those items which were carrying a lower rate as wrought iron raw materials.


Charles Avery Dunning: As soon as this became public we discovered items covered by it that were not formerly suspected, even by officers of the National Revenue, all through the iron and steel schedule.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-398a. Pipes and tubes of iron or steel, seamless, cold drawn, plain ends, polished, valued at not less than five cents per pound; steel tubes, welded or seamless, more

Customs Tariff
than 101 inches in diameter, with plain ends, when imported for use exclusively in the manufacture or repair of rolls for paper-making machinery:	British preferential tariff, free;
intermediate tariff, 20 per cent; general tariff, 30 per cent.
Charles Avery Dunning: That is in precisely the same position. As it appears in schedule IV of the United Kingdom agreement, this tariff item guarantees free entry to products of that country enumerated in the classification 398a. As contained in the budget resolutions, intermediate and general rates of 20 per cent and 30 per cent respectively were provided for. Since an intermediate rate of 20 per cent would have had the effect of increasing the duty from intermediate countries on certain steel tubes imported under this item, and since any such increase was not intended but was resulting merely from a combination of two former rates within one classification, I will ask my colleague to move an amendment that the intermediate rate in question be changed to 15 per cent. This rate will conform with the guaranteed fixed margins under this item in schedule V to the agreement.


Richard Bedford Bennett: That was the question I intended to ask.


James Lorimer Ilsley: I move:-
That the intermediate rate on tariff item 398a, as contained in resolution No. 3 of February 25, 1937, be amended to read as follows:
Intermediate tariff-15 per cent.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-434b. Steel wheels for use on railway rolling stock: British preferential tariff, 71 per cent: intermediate tariff, 30 per cent; general tariff, 35 per cent.
Charles Avery Dunning: This is another item of the same type. As contained in the budget resolution this item set one rate of 71, 30 and 35 per cent in substitution for the former rates under two items, namely 71, 30 and 35 per cent, and 15, 271 and 30 per cent. The effect of this has been to raise from 271 to 30 per cent the rate on certain wheels that may be imported from intermediate tariff countries, and since any such increase was not intended, and further, since there is no fixed margin guaranteed on this item, it is proposed to alter the form of the item by creating two sub-items so as to leave the rates under intermediate and general tariffs unchanged.
The changes will be:-
434b. Steel wheels for use on railway rolling stock:	(i) pressed steel, British preferential
tariff, 71 per cent; intermediate tariff, 30 per 31111-1774
cent; general tariff, 35 per cent; (ii) n.o.p., British preferential tariff, 71 per cent; intermediate tariff, 271 per cent; general tariff, 30 per cent.
That maintains the precise relationship now existing, and avoids an increase.


James Lorimer Ilsley: I move:-
That tariff item 434b, as contained in resolution No. 3 of February 25, 1937, be amended to read as follows:
434b. Steel wheels for use on railway rolling stock, viz:
(i)	pressed steel: British preferential tariff, 71 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent.
(ii)	n.o.p.: British preferential tariff, 71 per cent; intermediate tariff, 271 per cent; general tariff, 30 per cent.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-519. House, office, cabinet or store furniture of wood, iron or other material, and parts thereof, not to include forgings, castings and stampings of metal, in the rough: British preferential tariff, 15 per cent; inter-medate tariff 371 per cent; general tariff, 45 per cent.
Charles Avery Dunning: This is the furniture item, which will be found on page vi of the Votes and Proceedings of Tuesday, March 30. As I pointed out on a former occasion, we have a further report from the tariff board. The recent history of the furniture tariff is this. When this government came into office, importations of furniture from the United States, being then under the general tariff, carried a rate of 45 per cent ad valorem.


Richard Bedford Bennett: Wnere it still remains.


Charles Avery Dunning: Where it still remains, yes. That is the point that I was coming to. Under the general tariff with the United States, which granted to that nation most favoured nation treatment, they automatically received the advantage of the intermediate tariff rates on this item and also the advantage of a discount under the French treaty, which produced an effective rate of twenty-seven per cent on furniture from the United States.


Richard Bedford Bennett: Thirty less ten.


Charles Avery Dunning: Yes. During the negotiations the government of the United States was anxious to have the rate bound at this lower figure, but the Canadian conferers refused to accede to this request having regard to the then known condition of the industry; and shortly thereafter the furniture tariff was referred to the tariff board for inquiry. An interim report was received during the last session of parliament in which the board indicated that they were not in a position to
Customs Tariff

recommend any action. The reference was continued, resulting in the report which I tabled the other day in which the board recommends an increase in the intermediate rate to 37^ per cent which, being subject to the ten per cent reduction by reason of the French treaty, would mean an effective rate of 33$ per cent, as compared with an existing effective rate of 27 per cent. The board also calls attention to the disorganized state of the industry and suggests that the change here recommended should not be regarded as final but should be made the subject of further inquiry, together with notice to the industry that in the opinion of the board they should put their house in order and be in a position to work under a lower tariff than the one here recommended.
I do not propose to go into the matter in further detail at this stage. I have the report of the board before me and I have no doubt that many hon. members have read it. Suffice it to say that the industry is an important one, employing a very large number of people. Factories are located mainly in the small towns of Ontario and Quebec. The effective rate of duty after this amendment goes into force will still be some 12 per cent below the rate effective against the United States when this government came into office; and the government having given very careful con-si4eration to the report of the tariff board has decided to recommend it, having regard to all that it contains and also the desirability of giving this industry time to re-orient itself to the changed conditions, on the understanding that a further review will be made in the near future. I will now hand the item to the chairman.


James Lorimer Ilsley: I move, Mr. Chairman:
That tariff item No. 519, as contained in resolution 3 of February 25, 1937, be further amended to read:
519. House, office, cabinet or store furniture of wood, iron or other material, and parts thereof, not to include forgings, castings and stampings of metal, in the rough: British preferential tariff, 15 per cent; intermediate tariff, 37$ per cent; general tariff, 45 per cent.


Mr. J. G. ROSS (Moose Jaw):: This item is of considerable importance to people throughout Canada. I do not think there is anything that is more needed to-day in practically every household than new furniture. We have gone through a hard time in the last five or six years and it is very difficult for people in Canada, no matter in what section, to replace furniture. This industry's case was put before the tariff board some time ago and a report was submitted. I have a copy of the report, sessional paper 185b, which was laid

on the table on March 22, 1937. The Minister of Finance spoke of the effective rate as 27 per cent. That is the tariff, but the three per cent excise is also a tariff and is an effective rate of tariff protection. Therefore you must add to the 27 per cent, 3 per cent on the duty paid value. The duty paid value of S100 worth is $127, and with 3 per cent on top of that you get, not 27 per cent, but something between 30 and 31 per cent. The change that is to be made will mean 37$ per cent under the intermediate tariff, with 10 per cent off under the Canada-France agreement, bringing it to 331 per cent; and then you add to that the 3 per cent in the same way; in other words it is 3 per cent on $133.60, which brings the tariff rate back to 37f per cent.
With regard to industry generally in Canada, my hon. friends opposite have made several arguments to show why there should be a tariff. I do not want to take up too much time, but I wish to enumerate some of these arguments, and I want to see what the tariff board has to say about these arguments. The first argument is that of the infant industries; the purpose of the tariff is to nurture such industries until they get on their feet. The second argument is generally that higher wages are paid in Canada and we have to compete with people whose standard of living is lower. The third argument is that wages paid to the employees in any industry increase the purchasing power in the country. The fourth is the building up of Canada on a sound economic basis in order to find markets for primary products and for raw materials. The fifth is that large imports in times of depression or business stagnation come in and dislocate the market. The sixth is that water or other low freight rates enjoyed by competing countries allow our competitors an advantage. There may be some others, but I shall deal with these.
First, the life of the furniture industry. According to the tariff board report, page 7, the furniture industry in Canada started in 1850, eighty-sevtn years ago. In 1890-the year before I was born-there were 1286 plants in Canada; in 1900 there were 169, in 1920 there were 348, and they range from that to 404 in 1935. So this industry is quite an old infant. I do not think we need argue that it should be further protected by tariff in order to get it on its feet; if it is not on its feet now, it should be in the grave.
The second argument used is the number of employees, and the wages and salaries. On page 11 of the report of the tariff board we find that in 1926 there were 9,800 employed in the furniture industry in Canada. They were paid $10,457,420 in wages and they pro-

Customs Tariff
duced $31,293,442 worth of goods. I would remind the house that at that time we were under a tariff of, I believe, 27 or 30 per cent- 30 per cent under the general.
In 1927 the employees numbered 11,038, wages were $12,041,421, and the product amounted to $35,733,818. It will be seen that at that time each man in the industry was receiving better than $1,000 a year.
Coming down to 1928, the employees numbered 12,539, with wages of $13,689,344, and $41,825,534 in products.
In 1929 there were 13,082 employees, $14,512,073 in wages, and $44,136,176 of products.
In 1930 the employees dropped to 11,980, wages amounted to $12,774,596-still over $1,000 per man-and $36,866,195 in products.
In 1931, the employees numbered 10,007, wages $10,047,027-it is down to the even $1,000 now-and products $27,135,171. In the
following	years the figures are as	follows:Employees	Wages	Product1932. .	.. 8,348	$6,882,087	$17,998,8421933..	.. 7,722	5,656,000	15,016.9421934..	.. 8,423	6,497,598	17,159,1551935..	.. 8,827	6,954,097	19,208,050
Under the higher tariff it will be noticed that the production went down, and the wages per man went down from $1,000 to $800 per year. Also by these figures it is seen that at the time we produced the most furniture in Canada, we imported the greatest amount from the United States. In 1929 the imports were $3,100,000, and in that year $44,000,000 worth was the peak of the production in Canada.
In regard to the suggested higher wages in Canada, at page 37 of the tariff board's report we find some figures. I have heard the argument around the house and in the lobbies in the last few days that the Canadian furniture industry is competing with an industry which has moved south in the United States where coloured labour is being used at very low wages.


Mr. EDWARDS:: That is perfectly true.


John Gordon Ross: The tariff board does not say so. The tariff board says that taking all sections of the United States the wages paid in cents per hour in the furniture industry are 42-6, and:
Wages paid cents per hour
In Rockford, Illinois	 44-7
Grand Rapids, Michigan		42-0
Jamestown, New York	 49-7
Southern Indiana	 40-0,
Southern States, average..	..	38-0
Southern States, larger towns..	41'0
The lowest average wage in the United States is 38 cents per hour in the southern states. The wages in Canada, as found by the tariff board, were for Ontario 35 cents
per hour in 1935, and 35-85 in 1936; in other words, over 2 cents an hour lower than for the negro in the south in the furniture industry. In Quebec province in 1935 the wageifl paid were 26-90 cents per hour, and 27-52 in 1937, or over 10 cents an hour lower than paid to coloured labour in the southern states. In British Columbia the wage paid was 35 cents an hour, or 3 cents lower than in the southern states. In other words, the lowest average wage paid in the United States in the furniture factories was 3 cents an hour higher than the highest average wage paid in the furniture industry in Canada. Surely that is an answer to that argument of my hon. friends. These are not my figures; they are from the report of the tariff board. It goes on further to say:
These figures are for machine room, cabinet room and finishing department operations, and cover senior workmen engaged in the principal operations in those departments. The American rates do not include wages of helpers or those engaged in supervising capacities. The Canadian rates apply to men only, the boys having considered by the board to correspond generally to what the American source of information classifies under the title of helpers.
The report goes on to say that there are few women in the industry, and that notwithstanding that wage rates in Canada are lower than in the United States, the labour for a piece of furniture seems to cost more. But they state that wages in the furniture industry in Canada are lower than in the United States. Therefore, the second theory in support of tariffs falls to the ground.
When one goes back through the report one finds that these wages of 35 and 35-85 cents an hour in Ontario are very different from what they were a short time ago. In a letter to Mr. Campbell, of the tariff board, one of the furniture manufacturers protested that he found some of the others were not living up to the agreement between the manufacturers and the Ontario government, and he said:
We notified the government and they in turn reported that it was even worse than what we had intimated. We reported that there were some paying as low as ten cents per hour to labour, and they told us that some were paying as low as eight cents per hour.
This is the industry for whose benefit we are asked to raise the tariff.


Charles Avery Dunning: My hon, friend will forgive me for interrupting him, but at this stage of his remarks it should be noted that since the board made its report, partly as a result of the Ontario government's code arrangement, and partly following a strike in the industry there have been material increases in the rates
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of wages paid, over and above the rates mentioned in the tariff board report, because the increases have been made since that report was prepared. I should tell my hon. friend also that among the applications to the government to implement the tariff board report were very strong representations from the trades unions engaged in that work.


Mr. MAYBANK:: Mr. Chairman, if the
hon. member will permit me to follow that interjection for just a moment, I should like to ask whether it would be possible for the minister to state whether similar wage increases have not also taken place during the same period in the United States. Perhaps the minister could give us that information.


Charles Avery Dunning: That is a fairly large question to answer, as applying to the whole of a great country like the United States.


Richard Bedford Bennett: It does apply in Grand Rapids.


Charles Avery Dunning: The right hon. leader of the opposition has knowledge of it applying in Grand Rapids. As to whether it applies further south I do not know.


Mr BENNETT:: That was in connection with the money advanced by the government of the United States to re-establish the industry.


Charles Avery Dunning: Oh, yes. That was in connection with a special arrangement made by the government of the United States under one of its alphabetical schemes for the re-. establishment of the industry, as a result of which wage scales were established.


Ralph Maybank: I asked my question for the purpose of endeavouring to show, as quickly as I could, that the argument of the hon. member neutralizes the argument advanced' by the minister.


Charles Avery Dunning: If my hon. friend will permit me, I made no argument. I thought the fact I stated was a necessary fact which the hon. member for Moose Jaw would appreciate at that stage of his remarks, dealing with wages. I made no argument whatever.


John Gordon Ross: In reply to the minister I may say -that according to the report the first rate given for wages in Ontario was 35 cents per hour for 1935 and 35-8 cents per hour for 1937. That is the change, though there may have been a further change since that time. However, while there may have been some change in the wage in part of Ontario, I do not believe there have been any wage increases in the province of Quebec.

Now, Mr. Chairman, we should look at these industries to see whether the wages paid really distribute purchasing power throughout the country. I can understand anyone advocating a tariff and bringing forward the argument that the additional cost to the people of Canada will be, say, $5,000,000, but that by the expenditure of that additional amount we will have perhaps twenty or twenty-five million dollars in wages expended throughout the country. But we do not find that to be the case in this industry. According to the figures I gave from page 11 of the tariff board report, it will be seen that the wages in the industry do not amount to thirty per cent of the value of the product; as a matter of fact, when it is worked out, it will be found that only 27| per cent of the value of the products of Canadian manufacturers of furniture is spent in wages, whereas the protection is thirty per cent or more. In other words, in order to have $8,000,000 spent in wages in Canada by those employed in the furniture industry, the people of this country must pay over $9,000,000 in extra prices. Surely no one can argue that purchasing power is distributed in that way. There is an actual loss of purchasing power there. At page 43 of the report the tariff board states that the cost of furniture in Canada is about thirty per cent greater than the cost in the United States. Argument No. 4 is the building up of Canada on a sound economic basis, but surely we do not build up Canada by taking $9,000,000 away from the Canadian people in order to give back $8,000,000, and no market is thereby provided for the primary producer. At page 22 of the report it will be seen that the raw materials used in the industry are largely imported from the United States. In 1935, according to the report, soft wood consumed by the industry was valued at $451,000, most of which no doubt was purchased in Canada. In the same year, hard wood to the value of $1,802,000 was consumed in the furniture industry, most of which presumably was imported from the United States.
Then in regard to the other argument, that in times of depression, or when business is stagnant, large imports dislocate the industry, at page 13 of the tariff board report we find that in 1935 only $286,000 worth of wood furniture, or 1-4 per cent of all the furniture sold in Canada, was imported from the United States. In 1936 United States manufacturers of furniture sold in Canada, all told, some $663,000 worth of furniture; in the same year, according to the same report, Canadian manufacturers sold $21,600,000 worth of furniture. So our imports amounted to about three per cent


Richard Bedford Bennett: Almost equal to the duty on hats.


John Gordon Ross: Almost. I quote again:
(5)	The value of wood furniture consumed in Canada during the calendar year 1935 amounted to $19,557,578. The Canadian manufacturers have supplied 97-48 per cent and the United States 1-47 per cent of the Canadian market. On the basis of the estimated 1936 production the United States manufacturers' share of the Canadian market appears to have increased to 2-96 per cent.
(6)	In ordinary circumstances the fact that the share of the Canadian consumption enjoyed by United States manufacturers is less than three per cent of that consumption would lead to the conclusion that no increase in the intermediate tariff is necessary; but certain conditions to be mentioned hereafter seem to point to the advisability of an increase.
(7)	Canadian furniture manufacturers are at a disadvantage, particularly in the higher-priced furniture, as compared with United States manufacturers by reason of duties on such raw materials as veneers, vegetable glue and glass.
And I might add coal.
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Richard Bedford Bennett: Electrical energy is used to a large extent in the factories.


John Gordon Ross: Yes, but some of them buy coal.


Richard Bedford Bennett: Very few, and I have seen many of them.


John Gordon Ross: When you put the tariff on for one fellow, you put the other fellow's costs up. My idea would be to cut off some of the tariff that the other man had, and allow the Canadian furniture manufacturer a better chance to make furniture in Canada.


Richard Bedford Bennett: That would not affect glass.


John Gordon Ross: There should not be any tariff on it at all, for that very reason.
(8)	The greatest disadvantage suffered by Canadian furniture producers as against United States manufacturers is the smallness of the cut in the Canadian factory-
And they go on to say-


Charles Avery Dunning: I wish the hon. member would quote it in full. If any is going on Hansard, let it all go on.


John Gordon Ross: I shall put it all on.
(8)	The greatest disadvantage suffered by Canadian furniture producers as against United States manufacturers is the smallness of the cut in the Canadian factory in respect of any one piece or suite of furniture. A cut of 50 is with few exceptions a maximum in Canada, and frequently the cut is much less, while in the United States a cut of 100 is regarded as the economical minimum. The result is that labour and material costs and overhead are relatively to production much higher than in the United States.
(9)	The board's investigations show that furniture in carload lots can be and is being imported from the United States into Montreal, the largest retail centre for furniture in Canada, at prices laid down duty paid below the prices at which similar Canadian furniture can be landed in Montreal from southwestern Ontario, the main source of Canadian higher-priced furniture. In considering this fact it must be borne in mind that a substantial proportion of such furniture manufactured in southwestern Ontario in 1936 was sold at a loss to meet the United States competition.
(10)	The concentration of buying power in a few companies; the advantage of exclusive designs obtained by importing furniture from the United States; the power to control manufacturers' prices by means of volume purchasing power; and the threat, suggestion, or fear of importations: all these factors put the furniture manufacturers in a peculiarly vulnerable position. The fact that the existing equipment in the 404 furniture factories in Canada is far more than sufficient to supply all Canadian requirements and the consequent existence of extremely severe competition among so many Canadian plants increases the power of the large buyers to exert pressure on the manufacturers.

The extremely keen competition within Canada would, in the opinion of the board, prevent any substantial increase in the price which the Canadian manufacturers could realize for their furniture even if the duties were raised to their former level.
If that is the case, I do not know what they want it for.
The absence of importations would remove only one of the elements constituting the pressure which the large volume merchants are able to bring to bear on the manufacturer.
While an increase in the intermediate tariff will not solve the problems of the Canadian furniture manufacturers an increase of such tariff to 374 per centum, which being subject to a reduction of 10 per centum would make the effectual rate 33J per centum,-
That is not a fact, because you must add to the duty paid value, the three per cent. That brings it back to over 37 per cent. I continue:
-would, in the opinion of the board, accomplish the following: First, it would affect the attitude of mind of the manufacturers whose perspective has been dislocated by the sudden drop in their protection from 45 per centum to 27 per centum.
There is a new idea in making tariffs. Some years ago I remember hearing a bridge game being played in New York where a man named Jacoby made a psychic bid. This is a psychic bid by the tariff board on behalf of the furniture industry. They were shocked when their protection dropped from 45 per cent, not to 27 per cent, but to 30 per cent.


Charles Avery Dunning: If you say 30 per cent, then you must start at 48 per cent.


John Gordon Ross: It would be more than 48; it would be 49.


Charles Avery Dunning: Forty-five and three.


John Gordon Ross: 
Richard Bedford Bennett: Not quite a half.


John Gordon Ross: I continue the quotation:
Second, it would give them an opportunity to carry on substantially as they did before the change in their protection for a period during which they might take stock of their position and perhaps work out a more economically organized industry than now exists.
In other words, they could not have an economically organized industry with 45 per cent protection. They had that protection for years and they never realized that they had to have an economically organized industry until the tariff was cut on them. Now that they have realized that, for goodness sake put the tariff up so that they can still be uneconomical t

Customs Tariff
I quote again:
The board suggests that it would be advisable and in fact necessary for the furniture manufacturers, particularly in southwestern Ontario, to begin immediately a study of their problems; and perhaps avail themselves of the conference provisions of the Dominion Trade and Industry Commission Act in an effort to preserve the industry and to maintain themselves in their position as important employers of labour in so many towns and villages in southwestern Ontario.
It will be seen from the foregoing that the board's findings are based largely on two considerations, namely:	The very wide drop in
the protection from 45 per centum to 30 per centum less 10 per centum thus making an effective rate of 27 per centum and what may be called the disorganized state of the industry particularly in southwestern Ontario. These considerations lead to the view that the whole situation ought to be considered again after, say, a period of two years and that any increase granted should be regarded as in the nature of a temporary relief rather than as a final view as to the amount of protection required by the industry.
In other words, does this poor infant industry which has lasted for eighty-seven years without getting on its feet, and without knowing it was decrepit, now realize that if they want to stay in business and give the people of Canada the proper kind of furniture at proper prices they will have to get down to an economical basis? No, they run right back again for more tariff. They seem to think that is the only solution. This budget came down without this change in it, and I voted in support of it. I will still vote in support of the budget without this change. It is rather late in the session to have a report laid on the table of the house embodying a change in the whole principle. I have talked lower tariffs in this house time and time again; I have talked free trade because I believe in it. I do not believe that tariffs can help the industries of this country. Certainly no industry should have a protection of forty per cent or over. If they need that much protection, they are not economical to the country.
I want my hon. friends to read what I have quoted from this report. They will then see that this tariff board, appointed by my right hon. friend opposite, had a most difficult time in finding reasons why the manufacturers of furniture in this country should be given more protection. In order properly to appreciate their minds I think one would have to sit for a time in the fisheries committee, or consult the hon. member for New Westminster (Mr. Reid), who knows a great deal about salmon. He would then find that the salmon go out to the sea and come back after four years. They pass through the strait of Juan de Fuca and then come up the
streams of British Columbia. They then continue up to the little stream or brook in which they were originally spawned. This tariff board has had a lot of difficulty. They have had to jump a lot of hurdles, just like the salmon does when he goes back home to spawn.


Richard Bedford Bennett: He does not spawn.


John Gordon Ross: My right hon. friend had better talk to the hon. member for New Westminster. I do not think the Minister of Finance had better laugh at that either.


Charles Avery Dunning: I know he does not spawn.


John Gordon Ross: Look it up and see; they all do. The salmon jump the falls and go back to the brooks in which they were spawned. Many of them die. I suggest to hon. members of this committee that there are people who act like salmon. These people should have taken the last hurdle in this country.


Mr. J. A. GLEN (Marquette):: Mr. Chairman, I little thought that I would be eulogizing the tariff board as presently constituted, but I think they are entitled to some commendation from those of us who happen to be either free traders or low traders, or whatever you like to call us. This board has given a report to the house along the lines indicated by the hon. member for Huron North (Mr. Deachman). The hon. member has submitted that information should be given to the house before tariffs are fixed and that from the evidence submitted a policy could be evolved with regard to tariffs.
Here we have an industry which is quite vital as far as Canada is concerned, and which no hon. member on either side of the house has any desire to injure. But we find ourselves in this position, evidenced by the report of the tariff board, that an industry which is dying of its own inanition and is uneconomic as far as this country is concerned has to admit, on its own showing before the board, that it cannot and will not prosper under the tariff which is now imposed in its favour.
I do not propose to enter at any length into the figures given by the tariff board in its report, but I should like to indicate the picture as we have it. On many occasions, when speaking on platforms in this country of industries in the east which are battening upon the people of Canada, I endeavoured to give as best I could the evidence upon which such statements were made, and here we have
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from a tariff board appointed by the late government the very material which justifies that particular argument.
It is neither pleasant nor easy for me to take the position I am taking to-night. Like the hon. member for Moose Jaw (Mr. Ross), I voted for the budget, but when I find in a supplementary item of the tariff such a departure from the convictions I hold with regard to trade, I must necessarily say so in this house and give my reasons. I do not propose to use, in proving my case, any arguments of my own; I am going to take the arguments submitted by the tariff board.


Charles Avery Dunning: Will my hon. friend permit me to interrupt for a moment? When he speaks of a supplementary item, I trust he does not thereby imply any intention on the part of the government to deceive. I indicated in the budget very definitely that certain reports from the tariff board were expected and that I hoped to be able to deal with such reports while the house was in committee of ways and means. I am sure my hon. friend did not intend any such implication.


James Allison Glen: The very opposite. I do not intend to imply anything or to indulge in any cavilling as far as the government is concerned. My only wish is that this matter could have been brought before the house at a time when we would have had more time to discuss it and when more hon. members could have taken part.


Charles Avery Dunning: The report was laid on the table a few days after I received it.


James Allison Glen: Quite so. But a matter such as this vitally affects the convictions of many in this house who, while they may not be freetraders, are low tariff men. We are now faced with a direct issue raised by the tariff board, an issue which we, holding the views we do, cannot avoid. In the argument I am submitting I intend to deal with this fact, that here is an industry which has been in existence for sixty years, and which therefore, as the hon. member for Moose Jaw has said, cannot be called an infant industry; and if during that period they have not so far put their own business in order so that they can be regarded as an economic unit in the industrial life of Canada, surely there is something wrong with that business. When one finds it contended that upon a reduction of the tariff there is a considerable influx of furniture from the United States in competition with the Canadian industry when actually less than 3 per cent is the amount supplied from the United States for consumption in Canada, and the other 97 per cent of the Canadian

market is controlled as against the world by the industry which is now established in our country, one can hardly credit that there should be any fear in the minds of those who now control so enormous a percentage of the home market. Then we find that the wages paid by the industry in Canada are less than those paid to the coon niggers in the factories of the south; so the old cry that the industry in Canada has to compete with the low-class and low-priced labour of the southern United States is disposed of by the very report of the tariff board itself.
Having disposed of that, the question arises, what about the industry so far as Canada is concerned? Is it an industry that we should recompense and protect against its own inefficiency? If so, it means that so far as we the people of Canada are concerned, by this increase in the amount of the protection afforded to the industry, the government is asking us to bonus the industry because of its own inefficiency; and when the tariff board suggests a temporary period of two years during which the industry shall have time to put its house in order, the plain fact is that the Canadian people will have to pay an increased price for the keeping of that industry during that time.
I do not think that the government of the day should have accepted the report and conclusions of the tariff board. Realizing, as the government must do, the convictions of so many of us, they must know that it would create disillusionment and discontent within the ranks. I will not believe that the government are willing to accept all the recommendations of the tariff board, nor do I think the government is bound to accept them. In view of all that is happening I trust that they will not feel themselves pledged to adopt those recommendations.


Charles Avery Dunning: We do not. I want to make that immediately clear to my hon. friend. The government does not feel itself bound, nor is there anything in the law which binds them to accept the report. The government spent days upon the consideration of this particular report before deciding, as a government, to recommend it to the house. The government is entirely a free agent in adopting its policy, no matter what the tariff board may say.


James Allison Glen: I am very glad that the Minister of Finance makes that statement.


Richard Bedford Bennett: He has threshed that out in great detail.


James Allison Glen: The government of this country is not bound by anything that the tariff board may recommend; they have the power

Naval Defence
to do what they think is best in the circumstances. Let us look a little into tariff history. This is from the report of the tariff board, page 46:
For many years prior to June 2, 1931 the rates of duty applicable to house, office, cabinet or store furniture of wood, iron, or any other material, in parts or finished, were 20 per centum, 27i per centum and 30 per centum.


Frederick George Sanderson: Order. It is eleven o'clock.


Some hon. MEMBERS:: Go on.


Richard Bedford Bennett: Some of us stay in this house all day, you know.
Item stands.
Progress reported.


NAVAL DEFENCE
William Lyon Mackenzie King: If the house will permit me I should like to make a brief statement before adjournment in reference to a communication I received to-day from Sir Robert Borden. Sir Robert mentioned in it that he had been somewhat surprised upon his return to the city and reading Hansard to find in the discussion on defence which took place in this house the other evening that I had cast aspersions on his motives and good faith in introducing in 1912 the measure with respect to the contribution of three dreadnoughts to Great Britain.
I rise immediately to say to the house, and through the house to Sir Robert Borden, that the last thought that was in my mind in speaking then, or at any time, was to cast any aspersion on his good faith with respect to any measure he introduced while he was Prime Minister. I was dealing with the construction that was put on measures in political controversy in the election of 1911, what was said in controversy between the political parties in 1912, and what was stated in this house at the time the question of emergency was brought up, and I believe that the quotations which my right hon. friend the leader of the opposition (Mr. Bennett) made from speeches of Sir Wilfrid Laurier that evening, in the course of the debate, bear out what I have said as to the construction which was placed upon the emergency or alleged emergency issue at that time.
I should not like a moment to pass without removing any impression that may exist that I have sought in any way to cast aspersions
on the motives of a former prime minister, and I hope the house will accept what I have said. I am sure it will be borne out by a reading of the debate that took place, on the subject.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Friday, April 9, 1937