1948-04-15

Hon. LIONEL CHEVRIER (Minister of Transport):: I desire to table the report to parliament of George A. Touche and Company, auditors of the Canadian National Railway system, for the year ended December 31, 1947, in English and French.
By leave of the house, I move:
That the report to parliament of George A. Touche and Company, auditors of the Canadian National Railway system, for the year ended December 31, 1947, tabled this day, be referred to the sessional committee on railways and shipping owned, operated and controlled by the government.


[Stage Direction]
Motion agreed to.

Lionel Chevrier: That the annual reports for 1947 of the Canadian National Railway system, the Canadian National (West Indies) Steamships Limited, and the Canadian National Railways Securities Trust, tabled on April 12, 1948, and the budget of the Canadian National Railways and Canadian National (West Indies) Steamships Limited for 1948 tabled on April 14, 1948, be referred to the sessional committee on railways and shipping owned, operated and controlled by the government, together with the following items of estimates for 1948-49:
Vote 502-Maritime Freight Rates Act, Canadian National Railways;
Vote 503-Maritime Freight Rates Act, railways other than Canadian National;
Vote 557-Prince Edward Island car ferry and terminals, deficit 1948;
And that the resolution passed by the house on March 9, 1948, referring certain estimates to the committee of supply, be rescinded in so far as the said resolution relates to votes Nos. 502, 503 and 557.


[Stage Direction]
Motion agreed to.

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

[Stage Direction]
Mr. WHITE (Middlesex East);
1.	How many rental appeals in respect of homes, housing and domestic establishments have been heard and adjudicated upon in the province of Ontario in each year and to date since the inception of rent control?
2.	How many were heard before county and district court judges?
3.	How many have been determined in favour of (a) the tenant; (b) the landlord?
4.	In how many such appeals was there an application for (a) increase of rental; (b) decrease of rental?
5.	Of such appeals mentioned in question 3 were (a) increases of rental granted; (b) decreases of rental granted?
Mr. MAYHEW:: Mr. Speaker, I discussed the subject matter of this question with the hon. member, and he has agreed to drop the question in its present form and reword it.


Mr. SPEAKER:: Dropped.


FLOOD CONDITIONS
[Stage Direction]
On the orders of the day:
Mr. T. L. CHURCH (Broadview):: I should like to call the attention of the Minister of Public Works to the damage recently done by the worst storm and flood in thirty years to the breakwater at Ward's island. This is a federal government work, and the federal government has admitted responsibility for the maintenance of the breakwater from Ward's island to Gibraltar Point.


Hon. ALPHONSE FOURNIER (Minister of Public Works):: I will give instructions to the engineer of my department in Toronto to make a survey of the damage and make a report. If the hon. gentleman is right in saying that we have admitted responsibility, he may be sure that we shall attend to the work.
Inquiries of the Ministry


FREIGHT RATES
[Stage Direction]
On the orders of the day:
Mr.  M. J. COLD WELL@Rosetown-Biggar: May I direct a question to the Minister of Transport, whom I questioned a few days ago about an alleged sharp increase in the express rate on eggs at certain points outside Regina? Can the minister now reply?


Lionel Chevrier: Yes, Mr. Speaker. The question which the hon. gentleman asked had to do with an individual shipment of less than 100 pounds-


Mr. COLD  WELL@: Per crate of thirty dozen.


Lionel Chevrier: I have made inquiries of the board and find that under authority of board order No. 70425, the railways on April 8 increased by 21 per cent their express rates which had previously been abnormally reduced to meet truck competition. For quantity shipments of crates of eggs, from the points mentioned, such as Yellowgrass, Milestone, Duval, Dafoe and Davidson, to Regina, the increases per crate vary from 4-7 cents to 6 cents for crates of 30 dozen eggs. For individual shipments weighing less than 100 pounds, the minimum rate was increased to a level apparently commensurate with truck competition. All these increases were made by the railways at their own discretion by virtue of the board order referred to.
If the hon. gentleman will refer to page 88 of the board's judgment he will find an item covering a minimum charge movement.


Mr.  M. J. COLD WELL@Rosetown-Biggar: If I may ask a supplementary question, the minister gave the increase in cents in the first instance but not in the second. Has he the figures in cents?


Lionel Chevrier: If the hon. gentleman will look at the item covering the minimum charge he will see that the minimum charge for a single less than carload lot shipment is 75 cents per 100 pounds. That is to meet truck competition, as set out in the board's order covering competitive rates.


CZECHOSLOVAKIA
[Stage Direction]
On the orders of the day:
Mr. J. G. DIEFENBAKER (Lake Centre):: Mr. Speaker, I do not know to which minister to direct this question, but I presume it should

be the Secretary of State for External Affairs. It has to do with the appointment of Evzon Syrovatka as consul for Czechoslovakia in Montreal. Is this the same man who was declared persona non grata to the United States government for alleged subversive activities, and if so, was the government of Canada consulted before the appointment was made?


Right Hon. J. L. ILSLEY (Minister of Justice):: Mr. Speaker, the Secretary of State for External Affairs is not here, but I shall bring the hon. member's question to 'his attention and perhaps he will wish to make a reply tomorrow.


GOVERNMENT ANNUITIES
[Stage Direction]
On the orders of the day:
Mr. STANLEY KNOWLES (Winnipeg North Centre):: May I address a question to the Minister of Labour? Is it true that the purchase price of government annuities is to be increased, and if so why, particularly at this time when the people of Canada want better old age security?


Hon. HUMPHREY MITCHELL (Minister of Labour):: As my hon. friend well knows, probably as well as anyone else in the house, any question of government policy will be stated in due course.


Stanley Howard Knowles: Are the reports in the newspapers correct?


James Horace King: Order.



INCOME TAX ACT


[Stage Direction]
On the orders of the day:
Mr. J. M. MACDONNELL (Muskoka-Ontario):: Mr. Speaker, may I again ask the Minister of Finance whether he has reached any conclusion with regard to referring the income tax bill to the banking and commerce committee?


Hon. DOUGLAS ABBOTT (Minister of Finance):: No, I have not, Mr. Speaker. My present intention when the preparation of the bill is completed is to refer it to the committee of the whole house, but if circumstances are such that it seems desirable to refer the bill to the banking and commerce commitfee, perhaps that might be done.


Mr. GRAYDON:: Better get some evidence from the farmers while you are at it.

Freight Rates



FOREIGN EXCHANGE RESOURCES


[Stage Direction]
On the orders of the day:
Mr. RONALD MOORE (Churchill):: Mr. Speaker, I should like to direct a question to the Minister of Finance of which I did not have time to give him notice. It is based on a report appearing in the Financial Post dated April 17. Is it true that schedule III of the emergency control legislation has not been proclaimed? According to the Post, that is cited as one reason why no further action has been taken recently to curb additional capital imports from the United States. It goes on to say that there has been a heavy flow of purchases of all types of capital goods from the United States in recent months.


Douglas Charles Abbott: The whole bill has not yet been proclaimed, because the regulations have not yet been completed. The matters covered by schedule III are now under control of my colleague the Minister of Trade and Commerce (Mr. Howe) by virtue of the powers contained in the Foreign Exchange Control Act.


Stanley Howard Knowles: He turned it over to you by letter.



COMMUNISM


[Stage Direction]
On the orders of the day:
Hon. BROOKE CLAXTON (Minister of National Defence):: Mr. Speaker, yesterday the hon. member for Calgary East (Mr. Harkness) asked me whether or not the Minister of National Defence or anyone of the headquarters staff had communicated with Brigadier Murphy regarding a speech he made at Calgary. I did not have full information yesterday, but I now have word from the general officer in command saying that he has communicated with Brigadier Murphy, who assured him that he has received no communication, verbal or otherwise, from any individual whatsoever indicating censure or adverse criticism resulting from his Calgary address.



CIVIL SERVICE


[Stage Direction]
On the orders of the day:
Mr. J. T. RICHARD (Ottawa East):: I should like to address a question to the Secretary of State, relating to the order in
council which bars civil servants from holding civic office where the salary exceeds $500. Will he state whether any representations have been made to him or the government to increase the maximum salary which may be paid to civil servants holding civic office? The matter is of particular interest at this time when there is the possibility of aider-men's salaries being increased.


Hon. COLIN GIBSON (Secretary of State):: Some representations have been received, and they are receiving consideration at the present time.



FREIGHT RATES-INCREASES ORDERED BY TRANSPORT BOARD-AMENDMENT, MR. COLDWELL- SUBAMENDMENT, MR. BRACKEN

[Stage Direction]
The house resumed from1 Wednesday, April 14, consideration of the motion of Mr. Abbott for committee of supply, and the amendment thereto of Mr. Coldwell, and the amendment to the amendment of Mr. Bracken.
Mr. F. S. ZAPLITNY (Dauphin):: Mr. Speaker, when the house rose yesterday at six o'clock I had pointed out that there were two phases to this issue of increased freight rates.


James Horace King: Order.


Frederick Samuel Zaplitny: I have pointed out that there are two phases to this issue of freight rate increases, namely, the general increase of 21 per cent across the board, and the question of equalization of freight rates across the country.
On April 7 the hon. member for Rosetown-Biggar (Mr. Coldwell), who leads this group, put the following motion as reported at page 2743 of Hansard:
. . . this house is of the opinion that the failure of the government to defer the imposition of the increases in freight rates recently authorized by the board of transport commissioners is inimical to the best interests of the people of Canada; further this house is of the opinion that the government should reconsider this matter and take action to prevent the proposed increases from coming into effect at this time.
What the debate has been about since that motion was moved has been chiefly whether the present government at Ottawa should take the responsibility-


James Horace King: Order. May I ask the hon. members to keep silent? I would ask the hon. member who has the floor if he will be kind enough to speak louder.


Frederick Samuel Zaplitny: Thank you; I shall do my best. Before I am through I believe I shall be able to make myself heard. I like to wind up slowly.


Some hon. MEMBERS:: Speak up.
Freight Rates


Frederick Samuel Zaplitny: You will hear presently more than you bargained for.
As I said, the debate so far has been on the motion of the hon. member for Rosetown-Biggar. Later the leader of the opposition (Mr. Bracken) moved an amendment to the amendment which, for all practical purposes, is merely a paraphrased version of the original amendment. The debate has revolved around whether or not the government should take the responsibility of deferring the imposition of the new freight rates, or whether the matter should be shelved or passed on to some other body. I hold in my hand a clipping which was handed to me only today which I think indicates the wisdom of the plea which my leader made for deferring the imposition of these rates until further consideration is given to them and until the provinces have had an opportunity to put their case before the board, if reconsideration is to be given to them. The clipping refers to the situation at the port of Halifax. It is dated Halifax, April 14. I submit that this has a very strong bearing on what we have had to say in this house, because the dispatch says:
Provincial government and waterfront officials today protested anew against increased freight rates as they considered its latest ramification- diversion of vessels from this port to avoid long rail hauls for cargoes. First example of this was the freighter Martha Kleppe, which arrived here today from Suez with 3,100 tons of peanut products and other cargo, consigned to Hamilton, Ontario. When about 1,000 tons had been discharged, the consignees changed their instructions and ordered the ship to New York. From there the goods would be sent to a great lakes port. An hour later it was learned that the English Prince, also carrying a cargo from the far east, had been diverted from Halifax to Montreal to save rail charges.
President J. J. Campbell, of the longshoremen's association, said the two diversions were examples of "what is in the wind."
"If we lose the far east business, we might as well hang out the crepe," he said.
Here is one example, and perhaps one of the first, to show that the tax increase of 21 per cent may have a more upsetting effect so far as the maritime provinces are concerned than was intended. That is to say, the transportation system of the two railways in the mari-times may find that instead of increasing the revenue by increasing the rates, they may actually receive less revenue in the long run, because shipping will be diverted from its regular course to the waterways in order to avoid paying higher rates. What is true of the maritime provinces is, to a certain extent, also true of the central provinces. There happens to be truck competition in the two central provinces. There is water competition for the

maritime provinces. For these reasons the railways are faced with one of two alternatives. They have either to keep the rates low enough to compete with these other systems of transportation and face a deficit, or put their rates up in some other part of Canada to make up the difference in the revenue. The result will be that, if the railway companies decide not to go the full length of the increase in the two central provinces because of the competition, they will eventually, in order to keep the revenue up, have to place still higher rates on the four western provinces. All this goes to show that it is time the government took , an over-all view of the whole transportation system and took immediate steps to see that equalization and justice are given to all parts of Canada.
The suggestions made by my leader in the course of his speech following his motion have, to some extent, been already adopted by the government, although under very severe pressure-but not to the full extent that they would have been adopted had the private members of the party that supports the government, and who sit across the way, and who at the first instance had been in the rebel camp, not too quickly laid down their arms. I believe they had a great opportunity to force the hand of the government on this issue, and they certainly should have used it. Of course I realize that things have happened since the motion was moved. We are told that there was a most powerful caucus held by the Liberal party, and according to the Journal of April 14 it appears that the whip was used mercilessly and ruthlessly, and whipped into line those so-called rebels who threatened to jump the line. According to the Journal we find that they were told very bluntly, because this issue is such an embarrassing one, because the risk of an election at this time might prove disastrous, they had better support the government, "or else", regardless of whether or not they had to face the music when they got back home.


Mr. SINCLAIR:: Were you there?


Frederick Samuel Zaplitny: Apparently there was somebody in on it, because I am now going to quote from the Journal, which says this, referring to the statement of the Prime Minister:
It had been his idea since 1945, he told his followers, that the government should live out its full term of office,-
A very desirable objective. I continue:
-delaying an appeal to the country until the spring of 1950.

Freight Rates
Then the report says this:
It was after this discussion that he discussed the government's position on the freight rates issue, bluntly telling the members they would have to fall into line.
Here is the real thing:
Should there be any deviation from party loyalty bringing an adverse vote, it would mean a general election on the unwanted freight rates issue.
I do not know whether he meant an unwanted issue or unwanted rates. Further down the article says this, to soften the blow a little bit:
The election would be the only possible course, and he warned his followers he believed the country would be "angry" and "resent" an appeal to it on the freight rates issue in view of the much more serious world situation.
I cannot conceive of the world situation being so serious at any time that it would prevent a government from submitting its stewardship to the judgment of the Canadian people. If the government feel that they are right on this issue, and would like confirmation of it from the Canadian people, I do not believe that they should use this subterfuge or a smoke-screen or any excuse to by-pass it and say to their followers: You will support the government because of the international situation, regardless of whether our domestic policies are right or wrong.
It is no secret that we have had two general elections in this country during the war, and the international situation then must certainly have been more serious than it is now. Yet at the present time, when the Prime Minister apparently feels that the issues are not favourable to the government, he warns his followers, You will support the government or take the consequences. I believe they will have to take the consequences in either event -if not now, at any rate later.
The minister also referred to the way in which the government treated the premiers of the provinces. The provincial governments made a very reasonable request asking that the government defer the putting into effect of the increase until they had had an opportunity to prepare and present their case on appeal. Instead of granting that very reasonable request, the government of course, in their famous order in council which was tabled in the house on April 7, told the premiers bluntly that they would do nothing of the sort.
I wish to quote briefly from an editorial which appeared recently in a newspaper which has recently begun publication. I refer to the Winnipeg Citizen, which to the best of my
knowledge and belief expresses an independent point of view. I quote:
Without a master hand at the controls, the government at Ottawa discloses an innate ability to take the wrong course. Latest of its maladroit moves must be considered the decision to refrain from delaying the enforcement of the 21 per cent rate increase permitted by the board of transport commissioners.
On April 24, the government is to meet the premiers of seven provinces to hear their representations on the matter.
Incidentally, the premiers have not yet appeared here; therefore the case has been prejudged. To continue:
There can seldom have been a more discourteous move on the part of a senior government than so to permit the subject of an appeal to be enforced before hearing the appellants' case. The premiers will meet to discuss an operation already settled and in effect. Is it to be supposed that Ottawa will reverse this fait accompli and thus create even more confusion?
It is doubtful if greater confusion is possible. The editorial goes on to say:
Operation "dropping the pilot" has not shown evidences of careful planning. In Mr. King's heyday there would not have been the series of tactical blunders perpetrated in the house and out of it in the past few months, seemingly the result of the lack of his masterful technique. Or is it that the government is old and tired?
I hope the electors will not allow the government to die of old age. No doubt they will take care of that. The point is, however, that this government, with perfect propriety, and I believe in perfect justice, could have given in to the plea of the premiers of the seven provinces and waited at least until they could prepare their appeal and take it to the proper body.
It is not only discourteous but it is taking an unfair advantage of any appellant when you have prejudged his case and handed him an accomplished fact before he has had an opportunity to lay the evidence before the judge.
I want to refer to the discrimination which exists between different parts of Canada in the matter of freight rates. Often in this house we have deplored, or those of us from western Canada have deplored, the fact that western Canada, which has so many varied resources, has not the secondary industry which it should have in order to develop those resources and convert them into finished products. We are being put in the position all *the time of having to produce our raw material and ship it east, paying freight rate on it, and then have it shipped back in finished form, paying freight rate on it again.
I believe the members of the house will agree when I say that one of the reasons for
Freight Rates

the lack of population in the west as compared with the central provinces is the fact that we have not been able to establish industry in our part of the country to the point that it should have been established by this time. One of the reasons for that is that the freight rate system works against any manufacturing industry in western Canada.
I have here some figures which I should like to put on Hansard. I will not put them all on, because we have been figured to death in the house in the last few days, but those that I am about to give are significant in that they show how the difference in the rates works against manufacturing in western Canada.
Let us take canned goods, for example. If you shipped canned goods from Vancouver to Calgary, a distance of 642 miles, the rate would be 98 cents per 100 pounds, whereas from Chatham, Ontario, to Thetford Mines, Quebec, which is 678 miles, a longer distance, the rate is only 45 cents per 100 pounds, or less than half the rate charged in the west.
Take cement. On a 300-mile haul the rate in western Canada or on the prairies is 24 cents per 100 pounds while in Ontario and Quebec it is only 19 cents.
Or take livestock. On a 300-mile haul on the prairies the rate is 30 cents per 100 pounds and in Ontario and Quebec it is 27 cents.
I have heard the hon. member for Medicine Hat (Mr. Wylie), which is in the province of Alberta, make the statement that if irrigation could be developed in his part of the province they could raise there vegetables which could compete with those produced in any part of Canada. I am not going to comment on the soundness of that statement, because I do not know. I take his word for it. But even if they could grow vegetables and can them there, with the freight rate system as it is operating against them1 they would have to pay more than twice the rate per 100 pounds to ship vegetables than is charged in the central provinces.
I want to make it clear that I am not joining in any criticism of the two central provinces. The people in Ontario and Quebec are not in the least responsible for the discrepancy in the freight rate system. That is something that is the responsibility and duty of the federal government, because we have a Department of Transport and a Minister of Transport-a genial minister, by the way-and it is their responsibility and duty to see to it that the transportation system of the country, and particularly the railroads, shall serve the needs of the Canadian people as conveniently

and as efficiently as possible and that the burden is distributed as fairly as it can be across the dominion.
Had the Minister of Transport accepted the motion moved by our leader in the first instance, most of this debate would have been unnecessary, but we have been put in the position in this house of having to get piecemeal concessions from the government by putting pressure after pressure upon it. That seems to be the only course which we can follow at the present time.
Earlier in this debate mention was made of certain rates on off-line hauls of grain, and today a question was asked about -rates on eggs, which again is evidence to show that the effect of the 21 per cent increase on branch lines in some parts of Canada is going to be even more serious than had been expected in the first instance.
The government has made the promise that it will submit to the board of transport commissioners, for another investigation, the whole question of equalization. It is doubtful whether, after the board has already sat for eighteen months, and after the government has had several opportunities to submit the question to the board, a submission at this time will bring any greater results than were achieved before.
I believe that we might be farther ahead in the long run if we were to admit that what is required is not another face-lifting job on this freight rate structure, but rather a major overhaul, and that the whole question should be submitted to an independent commission which would by-pass and perhaps to a certain extent forget the past history of the whole freight rate structure-all the prejudices and all the injustices that have crept in-and start from scratch t>o bring forth a plan which could be developed and brought into being.
On this point I wish to quote, again from the Winnipeg Citizen, a paragraph which I believe has a great deal of wisdom in it. It is as follows:
It is doubtful whether the present hoard, or any board appointed with the view of control of railway rates and practices, is competent to adjudicate the question so full of complexities outside the normal sphere of its authority. If the government wishes to carry the confidence of the country with it, it will appoint an absolutely independent commission of -a calibre equal to the importance of the issue and empower it to inquire into every phase and its full bearing upon public welfare.
I want to say that I agree with that paragraph. In other words, what is required now is an independent commissioner, perhaps a royal commission, which would take evidence

Freight Rates
across Canada apart altogether from the views of the railway companies or any interested persons, but based upon the welfare of the nation, and try to formulate a transportation plan which would work fairly in all parts of the dominion. I realize that it would not be an easy task, and it could not be done in a month or two. But from all appearances, even if it is handed to the board of transport commissioners, with all their experts and all the technical advice they can get, it is admitted that it may be a year, eighteen months or even longer before they can bring in their report or their judgment on the question of equalization.
There is something else to consider, and that is that we have reached the point in our transportation system where it is impossible to divorce railway transportation from truck, bus and boat competition. I think the whole system must now be taken as a unit for future purposes. In a modem country we can use all the forms of transportation we can lay our hands on, and I do not believe it will be necessary to displace any labour in the building up of a unified system of transportation. I think we can co-ordinate and synchronize the transportation of this country without displacing a single person, because we are still definitely in the expansionist stage of our transportation system:
We have been told in this house that we are now in the atomic age. On paper I suppose that is true, but much of our transportation is still just emerging from the horse and buggy stage. All we have to do is to go south across the boundary line to the United States, look at some of their forms of transportation, and compare them with some of ours. I am not saying that all of ours are in that stage. For example, we have the Trans-Canada Air Lines, which is almost a model of efficiency; we also have railway transportation which is of a high order. But much of our transportation is still in a backward stage of development. I think one of the reasons for that is the fact that in the past we have relied upon the principle of competition in a commercial way to provide transportation for this country. I believe that, up to a point, competition can be useful. but when it begins to interfere with the efficiency of the transportation system, when it is creating a chaotic condition or when it is getting to the point where competition becomes practically an end in itself, with each system of transportation trying to cut the throat of the other, it is time we began to think in terms of co-operation in respect to our transportation system.
In common, no doubt, with most other hon. members, I have had representations from trucking concerns and motor transport companies complaining bitterly about the encroachment of the railways upon their type of business. Plenty of evidence can be obtained from the railroads taking the opposite view. I think we in this country can make ourselves almost ridiculous if we go too far in that direction, if we take it that competition is such a good thing that we must compete each other to death. Even the most rabid private enterpriser, I think, will admit that when it comes to certain public utilities-and transportation is fast becoming a public utility in this country-there is a field for public ownership, or at least for a certain amount of social control in order that we may have co-ordination and synchronization of transport for the convenience and use of the public. I believe the criterion should be efficiency, convenience, and value for dollars spent, rather than the financial or commercial success of any form of transportation.
I will conclude, Mr. Speaker, by making a further plea to the government to consider carefully the question of acceding to the reasonable request made from this side of the house that a stay of the imposition of these freight rates be granted until the provinces have had an opportunity to prepare and submit their case in the proper way to the proper body.


Mr. J. A. ROSS (Souris):: I should like to offer a few comments, Mr. Speaker, on this freight rate issue. First of all I should like to quote the order in council under date of April 7, P.C. 1486:
The committee of the privy council have had before them the petition of the transportation commission of the maritime board of trade (representing, inter alia, the governments of the provinces of Nova Scotia. New Brunswick and Prince Edward Island), and representations on behalf of the governments of the provinces of Manitoba, Saskatchewan, Alberta and British Columbia to vary order No. 70425 of the board of transport commissioners for Canada of March 30, 1948, by providing that tariff schedules published and filed under the provisions of the said order be not effective until at least thirty days from the date of the said order.
The committee of the privy council, having given due consideration to the said petitions and representations, are unable to advise that the said order of the board of transport commissioners for Canada be varied in the sense requested.
This was signed by A. D. P. Heeney, clerk of the privy council.
As a further basis for my remarks I should like to quote the amendment which was so
Freight Rates

well introduced by my leader (Mr. Bracken), and also to endorse all the arguments so well advanced by him in presenting that amendment on April 13 with regard to this issue. The amendment reads:
That all the words after "this house" in the fourth line of the amendment be deleted, and that the following be substituted instead thereof:
"regrets the government's failure to secure the removal of inequalities and discriminations in the Canadian railway freight rates structure before the imposition of a horizontal increase of twenty-one per cent-an increase which is bound to intensify the aforesaid inequalities and discriminations; and
"Furthermore regrets that the government has refused the reasonable request of seven provinces that the imposition of increased freight rates recently authorized by the board of transport commissioners be delayed for thirty days until they could be heard."
The granting of this increase by the board certainly is going to intensify these discriminations, and in many cases will result in hardship upon those least able to pay. To some of these small shippers the increase will be as much as fifty per cent; to those who cannot afford to buy large quantities the burden will be great.
The situation is worse west of Fort William, where we find the mileage principle introduced. For instance, in parts of the prairie provinces we have to pay $169 more for a Chrysler car produced in Windsor than you pay for it in Ontario. For a light delivery truck we pay $150 more per unit than in Ontario. On an electric range we pay approximately $7 more, while the difference on refrigerators runs anywhere from $6.25 to $12.75 more per unit. For an ordinary washing machine we pay approximately $5 more per unit on the prairies than you do in the east. The farmer certainly is penalized, because he pays approximately $48 more for his binder than is charged in Ontario, -while on the 16 to 25 horsepower tractor the difference is $112.
I might go on and quote many other items, but perhaps a few figures as to freight charges for comparable distances would be sufficient. On an average haul of one hundred miles there is a difference of 4-6 per cent. On a haul of four hundred m-iles the rate is 12 per cent higher on the prairies than in the east. On grain we pay 13 per cent more per ton mile, and on lumber, which is quite an item to many producer's on the prairies, the difference is 31T per cent more per ton mile. On some commodities the difference is much greater. In certain parts of Alberta it is as much as 85 per cent more than in Ontario for certain distances. On bituminous coal the difference is 36-6 per cent.

I spoke of the difference on lumber. I would remind this house that according to the last issue of the Bank of Canada statistical summary the price of lumber in this country has advanced more than 216 per cent, and that does not take into account the higher freight rates, which will be a further increase. That is going to be quite an item for many people throughout the prairies. Certainly it will add to the cost of living. According to that same statement the cost of living index for the previous month was 150-8, an all-time high in the history of Canada; and again that did not take into consideration these increased freight rates. The other day the Minister of Transport (Mr. Chevrier), while presenting his argument in defence of the increase, placed on Hansard at page 2903 a table showing the rates from sources of supply to certain points in Canada. According to this table the greatest increase in the freight rate on lumber is on shipments to Manitoba, that increase ranging from $1.86-7 to $3.85-3 per thousand feet.
I have listened to arguments presented in behalf of various parts of Canada, the mari-times, British Columbia and so on. While I agree that the situation is difficult in British Columbia, I should like to place on Hansard certain figures which will give some idea of the benefit derived from competitive water rates. These figures deal with the year 1945, but I do not think there has been any significant change since that time.
The rate from Montreal to Vancouver on calcium phosphate is 75 cents, while the rate from Montreal to Calgary, because of the mountain differential, is $2,344. On ammonia the rate from Montreal to Vancouver is $1.25; to Calgary it is $2,334. On glassware the rate to Vancouver is $1.34 and $1.98 to Calgary. The rate on window glass is $1.00 to Vancouver and $1.98 to Calgary. On paint and varnish the rate is $1.25 to Vancouver and $1.98 to Calgary. The rate on barbed wire is 75 cents to Vancouver and $1.98 to Calgary, while on hardware and tools the respective rates are $1.25 and $1.98. I could mention such other items as structural steel, iron pipe, canned goods, and so on, but I do not think it necessary at this time.
As I say, those differences result from the zoning and the mountain differential, and I am afraid many people in Canada do not realize that these materials can be shipped much greater distances at considerable saving when they are sent by water. In any event, the people of Alberta probably bear the greatest brunt of these discriminatory freight rates; and this further increase is certain to add to their burdens.

Freight Rates
I certainly believe something should be done to equalize freight rates in this country, thoqgh I am not sure how that might be brought about. In the Globe and Mail of this morning I noticed an editorial dealing with this matter, headed, "The answer is more people". The editorial says:
The immediate issue before the house was whether railway freight rates should be advanced by 2il per cent in accordance with the ruling of the transport commission. The government is in favour of granting the increase at once. Objectors argue that, to begin with, certain "discriminations" should be ironed out. This demand, of course, comes exclusively from the western and maritime provinces, which, as everyone admits, will have to carry the large burden of the higher railway charges.
Further on the editorial continues:
Why must the people of the west and the maritimes rescue the railways by paying higher freight rates while Ontario and Quebec escape the extra levy almost entirely? It looks unfair, but it is not due either to the w-icked selfishness of the central provinces or to special privileges they enjoy. The reason for it is^ that they are in a competitively favourable position. Ontario and Quebec are, by Canadian standards, well populated and originate much traffic. Furthermore, it is traffic which can move by water or highway if railway charges go too high. Therefore freight rates are lower here than in parts of the country which are thinly populated and lack the services of ships and trucks. This is inescapable economics which no amount of argument can alter.
Further on the editorial states:
It takes very little imagination to see that the right answer "to the freight rates problem-the way to make transport cheap for the people of the now unfavoured regions-is to increase their numbers by immigration.
Then the last sentence reads:
What the country needs is a bold conception of its own future and some practical leadership.
Well, Mr. Speaker, I wish the problem were as simple as that. I agree with those comments; I hold no brief either for or against these two great provinces of Ontario and Quebec. But I do not believe immigration will take care of this problem in Canada. I want to put myself on record as to this question of immigration. More than once in this house I have argued for a much greater selective immigration to this country; but that would not cure the present difficulty. I have before me The Economic Annalist, issued by the federal Department of Agriculture. On page 5 it is pointed out that in 1946 there were 59,000 fewer people living on the prairies than in 1941. Most of the decline took place in Saskatchewan, but this movement is felt in the three western provinces, and it has been continuing since those figures, the latest available, were issued. In the same article I find this statement:
The number of people living on farms in Manitoba, Saskatchewan and Alberta declined by about 145,000, or nearly 13 per cent, in the period between 1941 and 1946.
My point is that under the policies of this government, both during the war years and today, that movement has been taking place; and it would be unfair and unjust to attempt to cure it by immigration without at the same time altering those governmental policies which have been responsible for it.
The following statement was made by the United States agricultural attache at Ottawa, Mr. Francis A. Flood, when he addressed the federation of agriculture at Brockville this past winter. I quote just one paragraph of his speech, a report of which appeared in the Rural Co-operator, as follows:
I have heard Doctor J. F. Booth, of your Department of Agriculture, say that Manitoba and North Dakota have more in common with each other than Manitoba and Ontario or than North Dakota and New York state; that New York state and Ontario have more in common, with each other than they do with their own prairie states.
The lines of similarity seem to run north and south rather than east and west-so that had arbitrary political lines been run north and south instead of east and west like the Mason-Dixon line and the border here, there would really have been more sense to it from the economic and social standpoint.
I want to make my position clear. I have always been proud of this Canadian nation. I have never had any time for those who talk about seceding or anything of that nature. However, I do want to point out the difficulties and strains faced by our confederation. I have pointed out repeatedly that I do not think we are making the most of our great nation. We have probably more undeveloped resources than any other country. We have many sparsely populated areas, and with the proper policy we could easily make a much greater nation of Canada than has been done during the past.
Further to the contrast between conditions in North Dakota and Manitoba-the province with which I am best acquainted, although I do considerable travelling in North Dakota- I have before me 'a recent issue of Searle's grain index, which gives a comparison of the cash receipts of the United States farmer and the Canadian prairie farmer. It shows that the cash receipts of the prairie farmer in 1947 for all farm products averaged $3,623 per farm family, while the cash receipts in the state of North Dakota averaged $14,940 per farm family. That is gross income, but I would
Freight Rates

think the percentages would be the same for net income. This gives some idea of the economic trials during the past years of the farmer on the prairies as compared with the farmer in the United States.
I have another editorial here to which I should like to refer; it was published in a journal which certainly cannot be accused of being anti-Liberal-the Winnipeg Free Press. The issue of April 12 contains an editorial headed, "A blow at the west." It is a long editorial and I shall read only portions of it. I quote:
Thus the burden of the $70 million per year increase now granted to the railways must fall chiefly upon the west and to a lesser extent upon the maritimes.
Having decided to oppose the board's judgment, the seven provincial governments did two things: they asked the dominion government by telegraph to postpone the coming into effect of the rate increase until after their appeal has been heard, and seeond, they agreed to meet at Ottawa on April 24 to work out a common procedure of appeal.
So matters rested until Wednesday, last, when Hon. Lionel Chevrier, dominion Minister of Transport, stated in the House of Commons that although petitions of appeal had been received from the seven provincial governments, the dominion government "has decided that it should not interfere with the effective date of the board's order." He qualified this statement with the phrase "without prejudice to any appeal." At the same time he tabled a copy of order in council (P.C. 1486) passed on April 7. This order states that the cabinet has before it the petitions of Nova Scotia, New Brunswick, Prince Edward Island, and the representations of Manitoba, Saskatchewan, Alberta and British Columbia and proceeds:
"The committee of the privy council, having given due consideration to the said petitions and representations, are unable to advise that the said order of the board of transport commissioners for Canada be varied in the sense requested."
Not since the transport board, a quarter century ago, undertook to throw out Crowsnest Pass rates has western Canada been treated so rudely and harshly . . .


James Horace King: I have permitted the hon. member to quote from newspapers, but I would ask him to refer to citation 306 of Beau-chesne's second edition, where he will find that it is not the practice of the house to quote articles which emanate from outside parliament. The house is interested in having the representations of members on the matter before the house, but not those of outsiders.


James Arthur Ross: I shall abide by your ruling. I am sorry if I have followed the example of the Prime Minister (Mr. Mackenzie King) and members of the cabinet. They have set me a bad example in this respect in other debates. I shall abide by your ruling and not follow them any further.


James Horace King: Some hon. members may blame me for having given already too much liberty to the hon. member for Souris.


James Arthur Ross: Without quoting it I would say that the editorial goes on to- point out that the minister's statement did not appear in the order in council. The editorial says that it is a misstatement of fact, and it goes on to say that as the government has handled these seven provinces very shabbily, surely the members from British Columbia and the prairie and maritime provinces will represent the people who sent them to the house as members of parliament.
In contrast to the editorial in that great Liberal journal, which certainly was written with great feeling, it has been a surprise to me during the last few days that supporters of the government from British Columbia, the prairies and the maritimes should rise in their places in this house and ignore completely the wishes of the vast majority of the people who had made it possible for them to be members of this House of Commons. More than that, they have completely ignored these requests from the governments of the provinces from which they come.
During the time that I have been privileged to be a member here I have given careful study to this matter, and have come to the conclusion that I should vote and talk in the interests, first of the people in my riding, then of the people in the great province from which I come, and then of the people of Canada generally. I would hope that every member of this House of Commons would so vote on this important issue of freight rates.
I remember that in the past a great issue was made of an incident when the Prime Minister, probably in some heat-I was not a member at that time-said that he would not give a five-cent piece to a Conservative government in any province. What is the situation today? First of all we have a coalition government in British Columbia. Then in Alberta there is a Social -Credit government. In Saskatchewan there is a CjC.F. government. In the great middle province of Manitoba we have a very efficient coalition government.


An hon. MEMBER:: Where is the Tory government?


James Arthur Ross: There is one standing right here who will vote as his conscience dictates. Then we go to New Brunswick, where they have a Liberal government. There are the provinces of Nova Scotia and Prince Edward Island where they have their Liberal

Freight Rates
governments. Therefore it is difficult for me * to understand the attitude of the Minister of Transport, the Prime Minister, and this government.
They may think that they are showing a strong hand, but I think it is really a sign of decay, a case of being in office too long. They might well have heeded the request of these seven provincial governments and stayed this judgment for some thirty days while the arguments of the provinces were being prepared, so that they could discuss the matter with the department and the government on a proper basis.


Lionel Chevrier: Does the hon. member remember a similar occasion in 1920 when a stay of a similar board order was asked for and refused under similar circumstances?


James Arthur Ross: No, that was long before my time in the House of Commons. I do not live too much in the past. I am more concerned with the present and future welfare of the people of my province.


Mr. GARDINER:: There was a good Conservative government in power then.


James Arthur Ross: I am not interested even in that, but rather in a future Conservative government administering the affairs of this country for the welfare of the people of Canada.


Lionel Chevrier: And interested in a little politics as well.


James Arthur Ross: I should be happy if I could ever rival the Minister of Transport in political astuteness.
I do not wish to take up more time, Mr. Speaker. In conclusion I earnestly appeal to every member of this house to give thought to the welfare of the people who sent him here. According to the Ottawa Journal this government had a very serious caucus of its members last Tuesday, and it is reported that the Prime Minister told them that this parliament should live out its full term. He probably threatened some of the boys with an election, which would not be palatable to many of them if the issue were increased freight rates. It has been amusing to me to see some of the boys opposite who were regarded almost as outlaws a few days ago now coming back into the house and attempting to swallow themselves on this great issue. I trust that every member of the house, irrespective of political affiliation, will vote in the interests of the constituents who sent them here and bear in mind the request which has been made by seven provincial premiers for a stay of the board's order.


Mr. A. M. NICHOLSON (Mackenzie):: Mr. Speaker, many members have spoken eloquently in this debate, but a good deal of material is still available that has not been discussed, and I propose to introduce some new ideas.
In the first place I would urge upon the Minister of Agriculture (Mr. Gardiner) that he stay in Ottawa a little more. I realize that pressing duties take him away from the capital from time to time, but it is unfortunate that in two major catastrophes occurring within the last six months the minister was away from Ottawa. I refer to the government's policy in connection with coarse grains which was announced last fall when the minister was in Saskatchewan, and to the recent decision of the board of transport commissioners increasing freight rates. I feel that the minister's absence places him in a very embarrassing position when he has to go back and justify government policy to his friends in Saskatchewan.
In view of the fact that seven of the nine provincial premiers are slated to be in Ottawa this month to interview the government, I cannot think of any good reason why the operation of the board's order could not have been stayed until the premiers were given the opportunity to speak for the people they represent.
I also cannot understand why the government has not taken action to give some relief to the Canadian National Railways in its overcapitalization. This is a problem which has been on our hands for many years, and if the government was really concerned about its own railway it could have afforded relief by adjusting the railway's capitalization. Prior to the amalgamation of the different railways into the Canadian National Railways system these railways were running in the red at the rate of nearly $1,000,000 a week, and I think it was quite unreasonable to ask the publicly-owned utility to take over a bankrupt set of railways and try to operate them in the clear year after year.
When the president of the Canadian National Railways, Mr. Vaughan, was before the railways and shipping committee in 1946 he outlined in some detail the proposals which his company had made to the government. At page 19 of the evidence he said:
I referred last year to a recommendation of mine that the government accept income bonds of the Canadian National Railway Company in payment of the amount owing by the railway to the government for repatriation of British * securities.
Mr. Vaughan also presented a table to the committee comparing the position of the Canadian National Railways with first-class
Freight Rates

railways in the United States. It showed that the Canadian National Railways had a ratio of fixed charges to operating revenues in 1939 of 26-24 per cent. Its competitor in Canada, the Canadian Pacific Railway, had a ratio of 16-76 per cent; the Pennsylvania Railway, 18-47 per cent; the New York Central, 14-10 per cent; the Southern Pacific, 13-79 per cent; the Atchison, Topeka and Santa Fe, 6-91 percent; the Union Pacific, 8-66 per cent; the Baltimore and Ohio, 12-68 per cent. The class one railways of the United States which I have just mentioned averaged a ratio of 15-21 per cent. By 1944, owing to accelerated .var traffic, there was a marked improvement in the ratio of all these companies, but still the Canadian National Railways was forced to operate at a very serious disadvantage. Its ratio had been reduced to 11-44 as compared with 6-50 for the Canadian Pacific, and 6-00 for the class one railroads which I have just mentioned in the United States.
At page 25 Mr. Vaughan said:
If the government of the day had not wished or desired to protect private capital, a number of the railways which now make up the Canadian National would have been forced into liquidation because of the fact that they could not meet the interest charges on their funded debt, and the result would have been that their funded debt would have been reduced to a point where they could earn interest charges on it.


Mr. ISNOR:: Does that statement apply to the United States lines as well?


Alexander Malcolm Nicholson: No, he is speaking of the Canadian National.


Gordon Benjamin Isnor: The lines in the United States are privately owned.


Alexander Malcolm Nicholson: But they have been taken to the cleaners and have adjusted their capitalization, and so they can show a fair ratio of fixed charges to operating revenues.


Gordon Benjamin Isnor: They are privately owned.


Alexander Malcolm Nicholson: I am not suggesting that the Canadian government should have asked people outside of Canada who had invested their money in the Canadian National Railways securities to take a loss on their investment. What I am saying is that the government should place the financial balance sheet of the Canadian National Railways in a proper light so that the railway would not for ever be held up to the criticism of those who oppose public ownership that it is always running in the red.
The president of the railway was asked by the hon. member for Rosedale (Mr. Jackman) whether the railway would be satisfied if the proposals made by the president the year

before, that the government accept income bonds in payment of amounts owing by the railway, were accepted. Mr. Vaughan replied:
We would say that we should have a proper set-up, one which would make our fixed charges not more than twenty-five per cent of what they are today. If you do that, if you would make our fixed charges not more than 25 per cent of what they are, we would not come back again. But this would be only a partial remedy of the situation.
I might say that on the basis of the financial statement we had before us at that time, that sort of adjustment would have given the Canadian National Railways around $30,000,000 a year more than they had.


Lionel Chevrier: May I interrupt?


Alexander Malcolm Nicholson: Yes.


Lionel Chevrier: I presume the hon. member is referring to the suggestion of the acceptance of income bonds in lieu of notes.


Alexander Malcolm Nicholson: Yes.


Lionel Chevrier: If that is what he is referring to, it would only be a matter of some $10,000,000 or $12,000,000.


Alexander Malcolm Nicholson: Yes; that was all that would be saved by the government accepting income bonds. But as the president replied to the hon. member for Rosedale, if the Canadian National Railways was placed in a competitive position with the Canadian Pacific Railway and similar class one railways in the United States, they would have to have an adjustment of their capital stock, reducing the fixed charges to not more than 25 per cent of what they had been for the previous year. If they had' paid only 25 per cent of that, it would have given them the sort of adjustment they were expecting at that time in an upward revision of the freight rates. I suggest that if the government was sincere in giving the Canadian National some very practical help, instead of authorizing the increase in- freight rates it would be much more practical to have made-


Lionel Chevrier: May I interrupt? The hon. gentleman is incorrect when he says that the government authorized the increase in freight rates. He is misrepresenting the position entirely.


Alexander Malcolm Nicholson: According to the hon. member for Rosthern (Mr. Tucker) the recommendations of the board of transport commissioners were not final. The cabinet would have the final say. He promised the people of Saskatchewan that nothing would happen; immediately therefore in the final analysis the cabinet must take the responsibility for approv-

Freight Rates
ing or disapproving this increase. The cabinet cannot shirk that responsibility.


Lionel Chevrier: Apparently the hon.
member did not listen to my speech.


Stanley Howard Knowles: We read your order in council.


Alexander Malcolm Nicholson: I was interested in reading some of the evidence given by the late Senator McGeer at the hearings in Vancouver in June of last year. I understand that the late Senator McGeer spoke for nearly four hours during the hearings, and made such an eloquent argument that none of the counsel appearing for the railways was able to pick any flaws in his case or embarrass him in any detail. Senator McGeer made reference to the very large percentage of preference holdings outside of Canada. In looking up the annual report for this year I was interested to find on page 20 that -51 of one per cent of the preference holdings were held in Canada, 96-64 per cent in the United Kingdom, -34 of one per cent in the United States, and 2-51 per cent in other countries.


Gordon Benjamin Isnor: Which company?


Alexander Malcolm Nicholson: The Canadian Pacific. The late Senator McGeer was very eloquent in protesting against a proposal to increase the toll on Canadian citizens to protect such a large number of people living outside of Canada. He had something to say about the board of directors; he said that there is only one member of the board of directors who lives west of Toronto, the Hon. Eric W. Hamber, Vancouver. He pointed out that the list of directors includes: The Right Hon. Sir John Anderson, London, England; Edwin G. Baker, Toronto; L. J. Belnap, Montreal; Hon. F. Philippe Brais, Montreal; D'Alton C. Coleman, Montreal; Hon. Charles A. Dunning, Montreal; G. Blair Gordon, Montreal; Hon. Eric W. Hamber, Vancouver; John W. Hobbs, Toronto; Louis, L. Lang, Kitchener; W. A. Mather, Montreal; R. S. McLaughlin, Oshawa; Ross H. McMaster Montreal; Sir Edward Peacock, London, England; Howard P. Robinson, Saint John; Robert C. Stanley, New York; G. A. Walker, ICC., Montreal. Senator McGeer had some rather unkind remarks to make about his old friend, Hon. Charles Dunning. He said:
Take Hon. Charles Dunning. He started in England -and got everything in the way of progress from the confidence that western Canadians placed in him. Probably no one is more guilty in the estimation of railway men of making greater blunders in railway building in Canada than this same Mr. Charles Dunning.
On page 8332 of the evidence Senator McGeer referred to the 1946 Canadian National deficit of 88,961,000 resulting from including a charge for interest on government loans of $21,322,583. He said:
Why does the government of Canada want interest on its own public utilities? We financed this war through the chartered banks in substantial measure by using deposit certificates. We got the money at three-quarters of one per cent and every chartered bank financing the war on that basis was in the excess profits taxes brackets. Imagine a nationally-owned public utility corporation asking for an increase in rates to pay $21,00-0,090 of interest into the federal treasury, when in the post war period we lent England a billion -and) a quarter dollars for five years. We did not say to her that we wanted any interest. No, we said for five years you are to pay no interest. Further we said we won't accept any interest from you on that loan unless your economic position is such that you can pay it.


Mr. HARRIS (Danforth):: On a point of order, how much longer is the hon. member going to read from this essay that he has in front of him?


Mr. DEPUTY SPEAKER:: Is the hon. member reading from a committee report that has been tabled?


Alexander Malcolm Nicholson: I was reading from the evidence that was given before the board cf transport commissioners.


Lionel Chevrier: That is not evidence; that is a statement made by counsel.


Alexander Malcolm Nicholson: I should like to know what you call the evidence given by the former mayor of Vancouver to the chairman of the board of transport commissioners when the board was sitting in Vancouver trying to find out what public opinion was in connection with the matter. I should like a ruling, Mr. Speaker, as to whether I am in order in discussing it.


Lionel Chevrier: I submit with respect that the hon. member is not in order if he is quoting a statement made by the late Mr. McGeer, who was not a witness, but counsel.


Alexander Malcolm Nicholson: I would like a ruling, Mr. Speaker.


William Ross Macdonald: I understand that the hon. member is reading from part of the record?


Alexander Malcolm Nicholson: I am reading from part
of the evidence given by the late Senator McGeer when the board of transport commissioners sat in Vancouver and invited publicly interested organizations to appear to give evidence for or against the increase in freight rates.
Freight Rates


Lionel Chevrier: What was the date?


Alexander Malcolm Nicholson: June 19, 1947.


William Ross Macdonald: It is not very clear to me whether the hon. member is reading from the record, but hon. members have been allowed to read from newspapers which I do not think they should have, been permitted to do. Under the circumstances I am going to allow the hon. member to continue.


James Arthur Ross: It was not allowed a
few minutes ago.


Joseph Henry Harris: I rise on the same point again. Within the last hour an hon. member was called to order for reading from a newspaper, and he had to desist. That took place before you, sir, took the chair.


William Ross Macdonald: Yesterday afternoon I recall that a number of hon. members read newspaper articles, which I do not think they should have been allowed to do. I do not think it was in order. Probably I should state now that it is not in order for an hon. member to read from a newspaper or to read any statement made outside of the house reflecting on any debate which is before the house. At the present time it is not clear to me that the hon. member for Mackenzie is not reading evidence from the record; therefore I am not going to stop him. I would ask him to use his discretion as to how much further he should read.


Alexander Malcolm Nicholson: I have finished that particular part.


Humphrey Mitchell: May I ask the hon. member for the source of the remarks h'e is reading?


Alexander Malcolm Nicholson: If the hon. member had stayed in the house and listened he would understand. He does not expect me to repeat it three times.


Humphrey Mitchell: I say to my hon. friend that I spend more time in the house than he does.


Alexander Malcolm Nicholson: I announced that I was quoting from page 8332 of the evidence which was taken during the hearings when the board of transport commissioners were in Vancouver. I was quoting from the evidence given by the late Senator McGeer.


Stanley Howard Knowles: He is not even listening now when you do answer his question.


An hon. MEMBER:: What has the hon. gentleman in his hand?


Alexander Malcolm Nicholson: I have my notes in my hand and the hon. gentleman is free to check

on it. At page 8365 of the evidence the late Senator McGeer made the following statement:
I am quite satisfied this case is not going to end here, no matter which way it is decided. Furthermore, I believe it must be dealt with as a matter of public policy, because I do not think that these railways or this board have any power to attempt to solve the situation by this proposed increase of rates. On the contrary, I am firmly of the opinion that it will require a national policy vigorously and effectively enforced, and in the formation of that national policy in our system of constitutional democracy, the high court is not the governor in council, it is public opinion.
I should like therefore to take this opportunity to urge hon. members, particularly on the government side, to take to heart the words of wisdom of the late Senator McGeer and to consider what is in the best interests of the people whom they represent. I might mention that excellent evidence was given by representatives from all the provinces, but I have made a special study of the evidence presented on behalf of Manitoba, Alberta and Saskatchewan. The government of Saskatchewan was in my opinion to be commended for having selected as chief counsel Hon. M. A. MacPherson, who was attorney general and provincial treasurer in a former Conservative administration. I believe that all who followed the hearings were convinced that Mr. MacPherson did an outstanding public service in cross-examining the witnesses and in presenting the case for the people, especially in the prairies.
On page 8 of the brief presented by the province of Saskatchewan it is pointed out that the effect of the increase would be inflationary, and that:
If these forces continue to hold up the current level of economic activity, then the proposed increase in freight rates could easily become a factor leading to a further inflationary rise in prices since it would lead in all probability to further demands for higher wages . . . The effect of the proposed increase in freight rates might easily be such as to bring a double impact upon the industrial areas of Canada.
Then on page 9:
Great as is the threat which a substantial increase in freight rates offers to the Canadian economy as a whole, a still greater danger lies in the extreme probability of further disruptions in regional and international relationships. In the first place, to the extent that prairie incomes over a term of years have tended to be lower than the national average, an increase in freight rates will be regressive in that the burden will be borne by those least able to support it. In the second place, as will be shown at length in other parts of this submission, the proposed increase would almost inevitably be reflected in further sharp reductions in western incomes.

Freight Rates
In the submission by the Edmonton chamber of commerce attention is drawn to the effect which the increase will have and what it will mean to the people in that province. The Alberta members have presented this case very well, but I was interested in the rates applying to flannelette blankets which move to Edmonton at a rate of $4.53, whereas the rate from Montreal to Vancouver is $1.75. I find that the citizens at Holden, which is 60 miles east of Edmonton, if they were interested in ascertaining the freight rates on this description of material shipped from Montreal, would receive some rather unusual advice from the agent. The agent would say to them, "If you are in a hurry for the material and want it shipped here directly we will give you one rate, but if you are not in a great hurry, if you are satisfied to have the material go from Montreal to Vancouver and shipped back from Vancouver to this town, 60 miles east of Edmonton, we will give you a rate of 21 cents per hundredweight less than that which you would be charged if the material were shipped here directly."
I submit therefore that it will be very difficult to convince the people in the prairies and in British Columbia that a further increase of 21 per cent in freight rates that are now out of line in those provinces should be imposed upon our people.
In the material prepared by the Saskatchewan government some time ago we have a comparison of freight rates between Megantic, Quebec, and Ingersoll, Ontario, 596 miles, where the rate on lumber is 24 cents. From Golden, British Columbia to Moose Jaw, the same distance, it is 40J cents. On lumber the western rates are 39 to 69 per cent higher than the eastern rates.
The cement rate from St. Mary's, Ontario, to Apple Hill, Ontario, 388 miles, is 22 cents, and from Winnipeg to Madrid, Saskatchewan, the same distance, 28 cents. The rates are 30 per cent higher.
On petroleum products the rates in the west are 35 per cent higher; on salt the rates are 30 per cent higher, and so all across the line. But there is no reason for that. It has been demonstrated by the railways that they can actually move material more economically in the wrest than they can in the rest of Canada. I have here the orders and regulations of the board of railway commissioners for September 1927, giving the actual cost of moving freight in the different provinces.
Manitoba had the lowest rate at that time: [DOT]00232; Saskatchewan the second, -00281; Alberta the third, -00299; Ontario the fourth,
[DOT]00367; British Columbia, -00376; Quebec, [DOT]00504; New Brunswick, -00553. Nova Scotia and Prince Edward Island do not appear in this table.
I was interested in the net earnings of the Canadian Pacific Railway over a period of years in the east and in the west respectively, during the depression years and the years of the war. Their net earnings were much higher in the west. These were the earnings in the east and in the west in the following years:
East	West
1936	
$5,855,000	$17,455,0001937	
10,013,000	13,728,0001938	
3,319,000	17,432,0001939	
5,949,000	22,573,0001940	
14,058,000	21,580,000
Obviously it is unfair to impose a further 21 per cent tax on the people west of the great lakes, when that part of the system has been so profitable and when our people have been penalized throughout the years as a result of these exceedingly high freight rates.


Mr. SMITH (Calgary West):: Is that freight rates alone?


Alexander Malcolm Nicholson: Yes.


Gordon Benjamin Isnor: What were the profits of the Canadian Pacific Railway last year?


Alexander Malcolm Nicholson: The hon. member can get it. I am glad the hon. member for Fraser Valley has come into the chamber. I understand he is speaking immediately after me and I want to make an appeal to him. I have a very high regard for the hon. gentleman.
I think it is his opportunity now to perform an outstanding service to Canada and it is up to him to decide whether this injustice shall be perpetrated.
Speaking a few days ago, the hon. member commended the hon. member for Rosetown-Biggar (Mr. Coldwell) for the excellent speech he made. In fact he said it was the best speech the hon. member for Rosetown-Biggar has delivered since 1940. The hon. member intimated that if an opportunity were given to hon. members to test the opinion of this house, even although it involved a want of confidence motion, there would be at least three members * on the government side who would be expressing lack of confidence. He said as reported at page 2653 of Hansard:
I can assure the government that if some of my legal friends, the hon. member for Lake Centre or some other member of his profession, can show me how a motion can be introduced that will present this issue straight to the house, at least three British Columbia members will vote in favour of the motion, even it it should
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be a want of confidence motion, because we believe that the very future of our province is at stake in this matter.
The hon. member was right. The future of his province, as well as that of the prairie provinces, Nova Scotia, New Brunswick and Prince Edward Island, is at stake. Even if the government were defeated, if the members on the other side of the house are of the opinion that they have public opinion behind them, there would be no question of their coming back with a fresh mandate. But if the members of this house are not prepared now, as this debate closes, to stand up and be counted for or against this increase in freight rates, then we are going to introduce into our Canadian economic life a question that is so controversial that it will divide east and west more sharply than they have ever before been divided. It will make at least seven of the nine provinces feel that the dominion government has given them anything but a square deal.
We have heard from the hon. member for Vancouver North (Mr. Sinclair). He intimated that he was not one of the three mentioned by the hon. member for Fraser Valley. But we have not heard from the hon. member for Comox-Albemi (Mr. Gibson), the hon. member for New Westminster (Mr. Reid), or the hon. member for Fraser Valley (Mr. Cruick-shank) in this debate. I hope those three will make good the promise that was given a few days ago, to the effect that they are prepared to vote against this government and let the chips fall where they may.
Like the hon. member for Souris (Mr. Ross) who has just spoken, I have never had any time for those who advocated secession. Nothing would be gained by forming two or three separate countries within this dominion. Nothing would be gained by linking up with the United States. Within our democratic framework I think we have the machinery necessary to make it possible for us to iron out these differences.
I want to make my position clear. As far as the Canadian National Railways are concerned, I do not think the government needed to worry about giving them relief in this way at this particular time. I do not think the Canadian Pacific Railwaj' is in the position of needing help at this time. I feel it might have continued for at least another year until all the facts were thoroughly studied. I find that this railway has had generous treatment at the hands of the people. Again quoting from the board of railway commissioners for Canada, judgments, orders, regulations and rulings, under date of September 12, 1927, I find that the late Premier Oliver of

British Columbia mentioned the favourable treatment given to this railway, at page 147,
as follows:
Cash subsidy	 $25,099,900
Constructed railway including service	 38,000,000
Cash in exchange for subsidy lands 10,000,000 18,206,986 acres selected lands valued at	   27,310,000
Premier Oliver of British Columbia at that time said:
At the time of union, the people of British Columbia, protected by the statutes as then in force, had no reason to think, and as a fact did not anticipate, that they would be required to pay higher rates for service from the railway than were imposed in other parts of Canada on the same railway.
Had the terms of union stipulated that higher rates might be charged in British Columbia for railway service than were charged by the same railway in other parts of Canada, the people of British Columbia would not have entered the union on such terms.
I suggest, Mr. Speaker, that now would be a good time for the hon. member for Fraser Valley to help right this injustice which has irritated the people of his province through so many years.


Mr. G. A. CRUICKSHANK (Fraser Valley):: This is the first time, Mr. Speaker, since I have been in this house that I realize how important a nxan I am. I have had this idea about myself ever since I entered politics, but never had it been recognized in the house until today. I have just come from a meeting that I think was probably almost as important as this one. That is the reason I was out of the house. I am a member of the veterans affairs committee. The widows of non-pensioned Canadian veterans are appealing to us for assistance. That is the reason I had to miss part of what was said by the hon. member for Souris (Mr. Ross) and part of what was said by the hon. member for Mackenzie (Mr. Nicholson). That may be one of the reasons why I do not altogether appreciate the attitude of the government and of the board of transport commissioners in connection with this increase, since in my opinion any increase in freight rates will increase the cost of living of those veterans' widows.
As I said, I am glad to note that my hon. friends of the C.C.F. party now appreciate my value. In some ways I am sorry that they are not like my hon. friends of the official opposition who change their leader three or four times a year. I might have an invitation to take over their party.


Alexander Malcolm Nicholson: We shall watch how you behave today.

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George Alexander Cruickshank: I am glad the hon. member for Mackenzie mentioned what I said on April 5, 1948' in connection with the motion from the other side of the house. It is true that I was talking a little bit large when I said three members from British Columbia would vote for it. After all, I have authority to speak for only one member, and that is myself. The other two members may not be quite as bright as I am, and may not fall right in line. I am glad that the hon. member mentioned exactly what I said on that date.


An hon. MEMBER:: Who were the other two?


George Alexander Cruickshank: I will let them speak for themselves. As will be remembered, I said that if there should be a motion that would bring this matter fairly and squarely before this house and the people of Canada-and I want to repeat that: fairly and squarely before this house and the people of Canada-I would support it. Hon. members can read in Hansard exactly what I said.
I probably spoke too broadly when I attempted to speak for someone else. I said I would support the motion even if it meant a vote of want of confidence. My hon. friends of the C.C.F. party do not often slip. The hon. member for Winnipeg North Centre (Mr. Knowles) is an expert in preparing amendments. In fact, he is so good that not long -ago he marshalled out half his followers on the other side of the house and almost defeated the government by rushing them in suddenly.
I am sorry that in preparing this amendment he did not take the time to prepare it as it should have been prepared. I said at the time, and I repeat it now, that in my opinion the leader of the C.C.F. made an excellent, non-political, non-regional speech in connection with freight rates. In my opinion he made by far the best speech that has been made during this debate on freight rates. I repeat that, and I have no hesitation in doing so. The hon. member for Rosetown-Biggar (Mr. Coldwell) sent out the party whip who took only a minute or two to prepare his amendment. He came in with an amendment which the hon. member for Winnipeg North Centre himself described as one of nonconfidence. At page 2745 of Hansard of April 7, the hon. member's concern was not as to whether it will help the people of Canada, or particularly the people of my province who suffer more just now than does any other part of Canada; rather he said:
Carry this amendment and you will defeat the government.
The same thing was said by the leader of the C.C.F. party at page 2744 of Hansard, in almost identical language. In other words, the amendment was moved for other reasons than to improve the lot of the people of western Canada by eliminating discrimination. That amendment, which is at page 2743 of Hansard for April 7, appears in these words, and I want this on record again:
That all the words after the word "that" to the end of the question be deleted and the following be substituted therefor:
"this house is of the opinion that the failure of the government to defer the imposition of the increases in freight rates recently authorized by the board of transport commissioners is inimical to the best interests of the people of Canada; further this house is of the opinion that the government should reconsider this matter and take action to prevent the proposed increases from coming into effect at this time."


Stanley Howard Knowles: Don't you agree with every word of that?


George Alexander Cruickshank: I agree that the policy was not the best that might have been followed, but I defy the hon. member or anyone else to show me anything in that amendment which will help the situation. I shall refer to the subamendment in a moment; but if there is anything in this amendment that will help the pou 1 fry men and berry growers of British Columbia I should like to be shown it.


Stanley Howard Knowles: It is in one word; it asks for reconsideration.


George Alexander Cruickshank: Why did you not word it as the leader of the opposition worded his amendment? I am not altogether in favour of that one, but it is a far better resolution than yours.


Stanley Howard Knowles: All right; vote for his amendment.


George Alexander Cruickshank: I will do my own voting, and also my own talking. I believe the government erred in this connection, and I frankly say so. For the life of me I cannot understand why the government had to bring this increase into effect at once. Ever since I have been old enough, I have been borrowing from the banks, though perhaps my credit is not exceptionally good. To tell me that the two great railway companies could not have borrowed enough money to meet the demand for increased wages for only thirty days just does not make sense. I believe this action was an insult to seven premiers of Canada. I do not care what party they belong to; they represent seven of the provinces of Canada against the other two. All they asked was a delay of one month so that they could present
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their case. As I say, I believe the government was wrong in not granting that thirty-day delay. I do not agree with the government when they say it was necessary that the increase be put into effect at once. I do not think a short delay would have hurt the railways at all, because in the long run any decision would have been made retroactive.


Lionel Chevrier: No.


George Alexander Cruickshank: Perhaps not, except as to wages; but I say to the minister that if the railways of Canada will go bankrupt if they do not get that 21 per cent increase for thirty days, then it is time we took them both over and put in new management. What is most important to me in this connection, as I said the other day, is national unity. I do not believe you will ever get national unity in this country if two provinces can dictate to the other seven, and I do not care which two provinces they are. I am not referring to the members from either of those provinces who sit in this house. In my experience at Ottawa the members most willing to co-operate in anything which is in the best interests of Canada, particularly in the economic field, have been the members from the province of Quebec. I only wish the members from Ontario were the same. But I do not think any seven provinces should be imposed upon by the actions of the other two. I believe the government are mistaken in this policy, and in my opinion we shall get no action toward eliminating these discriminations for a long, long time if we depend upon the board of transport commissioners, without a directive from the government. The province of British Columbia has spent hundreds of thousands of dollars for the best legal talent it could engage.


Mr. GIBSON (Comox-Alberni):: The lawyers got it all.


George Alexander Cruickshank: That is quite true; the lawyers got enough to make up the deficit of the province of British Columbia. We shall now have to start all over again. According to the minister, the board has the authority to wipe out these differentials. In that case I think it is the duty of the board and the government to do so, without any further hearing. They have all the information already with respect to the mountain differential and other inequalities in certain parts of Canada. No one can tell me that the evidence presented to the transport commission by the greatest authority on freight rates we ever had in Canada, the late Senator McGeer, is not still on record; and there has been no great change in the meantime. Conditions may have

changed, but that has nothing to do with these inequalities; that is covered by the increase of 21 per cent. All the evidence with respect to the mountain differential is before the board, and I think it is the duty of the government to issue am absolute directive to that board. I do not see any point in setting up a royal commission or other special body, for if there is to be an inquiry they will have the same experts to advise them. I particularly object to the fact that the delay of thirty days was not granted in order to permit the seven premiers to appear before the cabinet.
I now wish to say a word with respect to the amendment moved by the leader of the opposition (Mr. Bracken), which, at least in one respect, goes to the core of the matter, in that it describes the discrimination which is being practised as against certain parts of the country. I have not a copy of the subamendment before me, but if I remember correctly it suggests that before any increase was granted these discriminations should have been wiped out. With that I entirely agree. I am sorry I cannot support the C.C.F. amendment, because I do not think it means anything.


An hon. MEMBER:: It is the same amendment.


George Alexander Cruickshank: It is not. The C.C.F. amendment says that this government has lost the confidence of the people, and that it is no good. I do not agree with that. With the international situation as it is today, I do not believe the people of Canada want an election; and do not think I am afraid to face one in my riding today, tomorrow or any day. If the amendment should carry, what could we expect but a general election, if hon. members like myself were asked to vote not on the matter of freight rates but on a direct question of want of confidence? I think the members of the C.C.F. party will admit that they could not form a government, and even the junior Conservative party in the far corner will admit that with the material available at present, there would be little chance for the party across the way to form a government. So obviously if the amendment carried there would have to be a general election immediately. I think the C.C.F. are quite right in fighting against discriminatory freight rates, but I say they should force the issue on freight rates, but not on a straight motion of want of confidence, in the only party that can carry on under present conditions.


James MacKerras Macdonnell: Mr. Speaker, I am sure all hon. members present will agree that we have had a very interesting inside account of yesterday's Liberal caucus.

Freight Rates
At such a late stage of this debate I hesitate to intervene, and I do so for only one reason. I do so because I think it desirable that someone from the province of Ontario-I am sorry the hon. member for Fraser Valley (Mr. Cruickshank) did not include us with the province of Quebec-should rise and say that he deeply regrets the situation which has arisen; perhaps I should say "someone else" from Ontario. Today we have seven provinces which genuinely feel they have been sinned against and that, whether or not it is the fault of the provinces of Ontario and Quebec, somehow we are getting an advantage we should not have. I believe we in Ontario and Quebec are very much like the people of the rest of Canada. I do not think we want any unfair advantage. It is because the government, by its neglect, has allowed this situation to develop that I feel justified in voting, as I intend to vote, for the motion of want of confidence in the government.
I want to digress just for a moment on the question of freight rates, to make my position quite clear. I agree with what has been said, and said very well, by the hon. member for Rosetown-Biggar (Mr. Coldwell) on another occasion. I agree that the railways must receive sufficient earnings to keep them sound. I agree with the hon. member for Rosetown-Biggar that it is a discouraging and even demoralizing thing for the officials of the Canadian National Railways, and I mention them particularly, to travel along with deficits such as they now have. They had a deficit in 1947, a year of record high business. Therefore I say not only is that prima facie evidence, but it is obvious that the railways have to have additional earnings. How can anyone expect the railways, in the face of the terrific increase in costs during these last years, not to need an increase in their earnings?
I wish to make another point which is perhaps incidental. There is an idea that some way or another all deficits of the Canadian National Railways can be cured just by relieving it of a lot more of its indebtedness. There is no warrant for that belief. The Canadian National Railways has had many hundreds of millions of dollars of its indebtedness absorbed, and in my opinion rightly so, by the government of this country. That has been done because they were forced to take over and put together a number of lines that were not intended originally to be put together. Nevertheless the Canadian National now have an indebtedness to the public of only something less than 25 per cent of their apparent assets. They have an indebtedness to the public of, I think, only 5849-190J
some $582 million against apparent assets of well over $2,000 million. Therefore I say that this increase in rates is something which the railways needed.
I now come back to the main point. I think it is a lamentable thing, something which should not be tolerated, that we should have in Canada-goodness knows we have enough difficulties in this country, enough things to divide us-a further division of the country on this question of freight rates.
The other day the minister made a most excellent speech. I tell him that if ever I am in trouble and have a weak case and need counsel to defend me, I shall be glad indeed to be able to get his services. He made a most plausible and even persuasive argument that there was really no fault on the part of the government, that the fault was all on the part of the provinces. He told us, and I have no doubt he was correct in telling us, that during the course of the rate investigation it had been pointed out that this was purely a matter of rates and that everyone had agreed that it was no occasion on which to discuss discriminations. The minister pointed out further, and at the time I was quite impressed, that in a great many years there had been no appeals from the provinces, that, although they could have come in and appealed against these discriminations, they had not done so.


Lionel Chevrier: I am afraid I shall have to interrupt the hon. gentleman. I did not say that there had been no appeals from the provinces; I said that there had been no variation of the board's orders, which is a different thing. I assume that the provinces did appeal from time to time from the various judgments.


James MacKerras Macdonnell: I will correct myself. The minister said that in those years the provinces did not take the initiative in coming and complaining against these inequalities. Is that correct?


Lionel Chevrier: From 1927.


James MacKerras Macdonnell: I was quite impressed with that at the time, but I looked up the judgment of 1927 when the matter was gone into most exhaustively. When I saw certain things that were said there I decided that, after all, I was not quite so impressed. It seems to me that in the course of that judgment various phrases were used which practically said to all concerned, there is no use in coming to Ottawa and talking about these things because they are all settled. I shall refer only briefly to the head-note of that case which is indicative of others. In refusing certain requests it was said that "the
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matter had been developed in other judgments and there seemed to be no other possible course to follow."
I can well imagine anyone thinking of coming here to appeal coming up against what he might regard as a judgment which says everything has been decided and there is no use in coming here and talking about it. The hon. member for Calgary West (Mr. Smith) points out that what I should have said was that there was no use of their coming here themselves and making application to the board after what had been done.
I come back ,to my first point, namely the fact that we have this discontent. In my opinion the government are greatly to blame for having let this situation ride along all these years, knowing that this discontent existed. They must have known it; they did know it. There was plenty of evidence of it. We had most eloquent testimony from both sides of this house during the earlier course of this debate. It is very sad that some of the voices have been stilled; nevertheless the fact remains that at one stage in the debate there was a considerable measure of agreement.
One of the responsibilities of men in responsible positions is to be able to foresee the consequences of their acts and also of their neglects. I say that the allowing of this situation to go on has resulted in just what is referred to in the amendment of my leader. Anyone should have been able to foresee, first of all, that in the face of rising costs the railroads would be granted higher rates. Anyone should have been able to foresee that the effect of that would be exactly what it has been, namely, to cause bitter complaints throughout this country, complaints which I think are most lamentable and most injurious to the welfare of the whole body politic.
There is only one further point I want to make. To have given thirty days to the provinces in which to come here and have another go of it would, I think, have been a most reasonable thing. I realize that the minister will probably say to me, "What was the use of their coming here? They would just say the things that were said before. It would be just a sign of weakness and we would be just pushed from pillar to post." In reply to that, I would say that it would have been a courteous thing to do. It would have been a sign of conciliation. I think it might have done something to lull the bitter feeling which we are seeing from coast to *coast.
The minister made a very persuasive argument. It was so 'persuasive that I had to get

away and think it over before I realized that it was not as convincing as it sounded at the time. He said that everything would be all right for the future, because the government was commissioning the board to go ahead and go over the whole thing again. He quoted the chairman of the board to ithe effect that he thought the board had sufficient power to enable them to review the situation.
What I intend to say now is not said with any disrespect toward the board or any member of it. If the matter is merely reviewed under the wording of this order in council, which does not seem to me to open the thing up or change it or give the board a fresh start in any way, I am afraid that, while the board may review the thing, they will review it, faced with all the decisions which have been made in the past. How are they going to jump outside of what they have done in the past? I do not see how they can do so. I am inclined to agree with the hon. member for Fraser Valley (Mr. Cruickshank) that they must have a new directive. I am not competent to say what that new directive should be.


Lionel Chevrier: What they need is new evidence.


James MacKerras Macdonnell: That is the thing that bothers me.


Lionel Chevrier: It is not direction that they need.


James MacKerras Macdonnell: I was hoping-I really got my idea from the speech of the hon. member for Calgary West (Mr. Smith)'-that perhaps it might be possible to call in some new board. I have thought that over and discussed it with people, who know more about it than I, and they think that to bring in a new board would not be feasible. That board would have to make use of the same experts and, further-more, this is a highly technical matter. We should remember that. It would probably take a long time before they would even understand this highly complicated matter.
But I doubt very much if under this order in council we shall get a fresh start. There is a feeling on the part of people throughout the length and breadth of this country that these men cannot really look at this thing afresh, unless they are given some new directive, to use the words of the hon. member for Fraser Valley, that is, unless the government takes responsibility.
It is finally the government's responsibility. Perhaps they could lay down some different rules under which this is to be done. I know that is difficult, and that it is a complicated

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matter; but I repeat, we have in this country a situation which is lamentable and I believe the government have been grievously at fault in allowing it to arise. I am dubious whether they will accomplish anything better under this order in council; whether they have really started out even now to cure the situation.


Mr. A. W. STUART (Charlotte):: Mr. Speaker, in the few remarks I have to make I believe I shall be introducing something new in this debate, and I am pleased to see the hon. member for Danforth (Mr. Harris) and other Ontario members now in their seats.
During this debate thus far we have heard little criticism regarding the necessity of increasing freight rates. It would appear as though the great majority of members who have taken part in this debate are convinced that an increase in freight rates is essential. The criticism that has been made is of the inequality of the way in which the rates are increased. I believe that, because of the increase in compensation paid to the railway employees and the enormously increased costs of materials used in the operation of the railroads, more revenue must be found, and sufficient evidence has been adduced to prove that this increase is necessary.
The chief criticism is that eastern Canada and western Canada must bear the greater part of the burden, while Ontario and Qudbec have little reason to complain. In other words, the failure to equalize the rates is responsible for the criticism levelled at the board of transport commissioners and the Department of Transport.
The increase was opposed by seven of the nine provinces. The neutral attitude taken by Ontario and Quebec would indicate that these provinces were not adversly affected.
If we wish to achieve the utopia of a united Canada, which appears to be approaching very slowly, sectionalism, the predominant factor in this debate, must be discarded, this atmosphere of suspicion completely cleared and a spirit of co-operation introduced in which we may approach this problem not as maritimers or as British Columbians, western or central Canadians, but as united Canadians.
I will take a few minutes to point out one of many circumstances in New Brunswick in which the citizens affected have developed a feeling of distrust toward industrialized central Canada. For many years in the town of St. Stephen, in the county I have the honour to represent, the St. Croix Soap Company manufactured an article used practically exclusively in the maritime provinces, and well known in
many other parts of Canada. Many citizens of this town were employed in this thriving industry. A few years ago Lever Bros., a large manufacturer in central Canada, approached the management of this small industry; they painted a glowing picture of the manner in which this little industry would grow if it were controlled by Lever Bros. The offer made to the owners, and the visions of a much larger industry, influenced the St. Croix Soap Company to sell their business to Lever Bros.
In a very short time production started to fall, and during the last war, when materials used in the manufacture of soap were in short supply, they were earmarked for central Canada. Eventually the manufacturing ceased in St. Stephen, and this small business, which means a lot to a small town, was moved to central Canada. We have left there at the present time an empty plant, and many of our citizens are out of employment.
The Mann Axe Company, in this same town, received exactly the same treatment, as did many other small industries in our province. This has brought about, as I have just said, a feeling of suspicion when you mention central Canada to a maritimer. As was pointed out yesterday by the hon. member for Royal (Mr. Brooks), the few manufacturing industries in the maritime provinces which have survived have done so on their merits by producing quality; for example, Ganong Bros, and Moir's, manufacturers of candies; Stanfield's products; Hartt, boots and shoes; Palmer, boots and shoes; Connors Bros., canned fish, and many others who produce quality goods known right across Canada.
Many of these manufacturers have a policy of one price to all. In other words, their commodities may be purchased in Vancouver at exactly the same price that we pay in the maritime provinces.	.
The Maritime Freight Rates Act provides that westbound freight from the maritimes shall be at a rate 20 per cent lower than that prevailing for eastbound freight to the maritimes. The new rate in no way affects this 20 per cent lower rate from the maritimes.
It has been suggested by several hon. members that if the railway board undertakes an investigation into the rate structure in this country it will not be completed in less than a year and a half or two years.
My belief is that conditions now prevailing can be greatly improved in a very short time if those who are in a position to assist are prepared to meet the challenge. I do not refer to the railway board or to the government of this country but to the manufacturers in
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central Canada who are protected by tariffs which have always operated to the disadvantage of the maritime provinces. The lowering of the tariff is one way of bringing about equalization.
Another method of approach would be for the manufacturers themselves to have one price only for every section of this country. This could-be done without costing the manufacturers a single dollar.


John Lambert Gibson: Horse meat the same price all over.


Andrew Wesley Stuart: That would be much preferable to granting subsidies, and I assure the house that it would bring about a much better feeling between the east and the west and central Canada.
I wish to refer to the table which the Minister of Transport (Mr. Chevrier) put on Hansard and to quote a paragraph from his remarks when introducing it. He said at page 2902 of Hansard:
A Chevrolet car moving east from Walkerville or Oshawa to Quebec will have to bear an increase of $7.33; to Montreal, $5.33; to Halifax, $7.86; to Toronto, $2.40; -to Winnipeg, $17.48; to Regina, $23.39; to Calgary, $29.73; to Vancouver, $31.26.
Mr. GIBSON (Comox-Alberni); Shame!
Mr. STUART (Charlotte); That will be the additional freight when the 21 per cent increase goes into effect. When the increase in the eight cities mentioned has been averaged you will find that the average increase is $15.58; the low in Toronto area of $2.40; the high in Vancouver of $31.26. The manufacture of this vehicle is exclusively in Ontario. This province received full benefit of the thousands employed and of the enormous -taxes paid by these large corporations which are protected by high tariffs.
No branch of this industry is established in the maritime provinces. We could purchase our cars in the same country in which we find markets for our produce were it not for tariff protection. Surely we are not taking a selfish attitude when a request is made to equalize the price of manufactured articles purchased from industrialized central Canada.
Many Ontario and Quebec manufacturers have already adopted this plan. For example, Tip Top Tailors, and many others, [DOT]have one price to all. I shall mention several that I believe should fall in line. To head the list would be manufacturers of cars and trucks, manufacturers of farm machinery and manufacturers of household appliances-

these appear on the list in Hansard-such as bathtubs, furnaces, stoves, refrigerators and hundreds of other household articles.
Another important item would be canned vegetables. Canned fish of all kinds, which are manufactured in the county I represent, are sold right across Canada at one price to all. They can be purchased in the city of Vancouver at the same price at which I can purchase them in the town in which I live. British Columbia salmon is another article that should sell in the maritime provinces for the same price at which it sells in British Columbia, and all vegetables that are canned in Ontario should have one price tag from Vancouver to Halifax.
Take, for example, manufacturers of cars and trucks. If they wish to adopt the idea that I have endeavoured to put forward they would have a record of the number of units delivered to each dealer in every part of Canada for several years. It would be a simple matter to find the average freight that should be charged right across the board. In this way those protected by tariffs-which is to the maritimer, as I have stated before, a subsidy-that benefit the citizens of central Canada only, would pay their proportional part in delivering the vehicle to the purchaser in eastern or western Canada.
Interprovincial trade, as well as international trade, must be a two-way street if it is to function successfully. Co-operation is essential. If the suggestions I have made should be adopted by manufacturers of central Canada, it would go a long way toward equalizing and balancing the freight rates that are under discussion at the present time. If hon. members from Ontario and Quebec are sincere in their desire to be helpful in this particular case, in no way could their sincerity be better exemplified than by pointing out to the manufacturers in their respective constituencies the unfair advantage they have taken of the citizens of eastern and western Canada, and at the same time use their influence in support of the removal of this gross injustice. This is not a problem for the government, but for the manufacturers themselves.
As I stated before, I am firmly convinced that an increase in freight rates was necessary; the burden, however, should not be borne by one or two provinces; it should be borne by all. This equalization can be realized to a great extent if we work, not

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as individuals for particular sections, but collectively as Canadians, and in doing so our united efforts would produce the desired result.


Mr. J. H. DICKEY (Halifax):: Mr. Speaker, in rising at this stage of a long and very fine debate I propose to make several brief observations on a question which is so vital to the maritime provinces generally and particularly to the constituency of Halifax. I propose to vote against the amendment moved by the leader of the C.C.F. party (Mr. Coldwell) and the amendment to the amendment of the leader of the official opposition (Mr. Bracken). I can summarize briefly my reasons for voting as I intend to do.
However, before I develop the one or two points with which I wish to deal I should like to refer briefly to the matter brought up earlier in the debate this afternoon by the hon. member for Dauphin (Mr. Zaplitny). He referred to a press report originating in Halifax relating to a situation in respect of which I had already received representations. I have been able to secure certain information relating to this matter which I should like to put on Hansard in order that the hon. member for Dauphin may realize the situation to which the newspaper report refers.
The hon. member made reference to two ships which have been diverted from Halifax. The first is the English Prince. This ship cleared from England under orders to proceed to Halifax or Montreal, depending on the opening of the St. Lawrence river. As a result of the opening of the St. Lawrence river this ship, while on the Atlantic has apparently decided to proceed to Montreal. This decision had absolutely no reference to the 21 per cent increase in freight rates. I would point out to the hon. member for Dauphin that it is specifically provided in the order of the board that the 21 per cent increase is not to apply to import-export rates through Canadian ports.
The other ship to which reference was made is the Martha Kleppe. This ship had a cargo consisting, in part, of some 2,200 tons of peanuts destined to a firm in Hamilton. I am advised that negotiations for re-routing this ship were in progress before the decision of the board of transport commissioners was handed down, and the decision to re-route this cargo through New York has no reference at all to the board's decision. As a matter of fact, not one ton of cargo in either of these ships was affected by the 21 per cent increase in the freight rates.
The decision of the board of transport commissioners has been to authorize a horizontal
increase in the rates of ordinary freight within Canada. This increase is contrary to the representations so forcefully made by counsel for the maritime provinces who appeared at the hearing. It is contrary also to what is conceived to be the spirit and the principle of the Maritime Freight Rates Act and, perhaps most important of all, it is contrary to what many conceive to be the essential interests of the development and the healthy continuance of the economic situation in the maritime provinces.
Protests against this horizontal increase have been widespread throughout the maritimes and in other parts of .Canada and these protests have resulted in the announcement of the premiers of seven provinces of an appeal from this decision. The Minister of Transport (Mr. Chevrier) has clearly stated that the government is prepared to hear this appeal and to deal with it when it is made. I should like, as simply and as briefly as I can, to sum up the situation as I see it in its application to the maritime provinces.
As a result of the Duncan commission of
1926,	which was a wide and searching inquiry into the whole economic system of the maritime provinces, the Maritime Freight Rates Act was passed by the federal parliament in
1927.	The purpose and basis of this act were to equalize existing discriminations against the economy of the area of the three maritime provinces and to do away with certain disabilities which had been imposed upon the economic development of those provinces.
Both before and after that commission and the enactment of the Maritime Freight Rates Act, the board of transport commissioners in various decisions has considered the powers which are given to it under the Railway Act to deal with the question of discrimination and inequalities. It has also, not less importantly, made decisions with respect to the matters and considerations of which, under the act, it is permitted to take cognizance in determining applications of this kind.
My own view is that the board of transport commissioners, in the past, has taken the position that it is not empowered to deal with the kind of discrimination and the inequalities against which we complain in the maritime provinces and, further, that it is not empowered under the act to give consideration to the problems of geography and of distance which we say are the very considerations to which, most importantly, regard should be had in dealing with 'the difficulties under which we operate in the maritime provinces.
This view which I have stated is not shared unanimously. The government, by the order
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in council presented to the house by the Minister of Transport, has instructed the board of transport commissioners to institute a full and searching inquiry into the question of discrimination. The wording of the order in council is addressed to the board and instructs it to make an investigation with a view to establishing a fair and reasonable rate structure which will, under substantially similar circumstances and conditions, be equal in its application to all persons and localities in the various provinces and territories of'Canada.
This is in line with the suggestion made by my colleague the senior member for Halifax (Mr. Isnor) when speaking in this house on April 5. In stating to the house the basis on which the government had passed this order in council, the Minister of Transport, speaking earlier in the debate, clearly stated his opinion that the board has full powers to deal with all questions of discrimination and inequalities which may exist in the rate structure throughout the dominion, and in addition he has stated that the chairman of the board of transport commissioners has said to him that is also his view of the situation.
I submit that this must be understood as instructions from the government to the board, with respect to the investigation which they have authorized it to make, to exercise its full plenary powers, whatever powers it may have under the act, to carry out a full investigation and to reach a decision on the matter referred to it.
In my opinion this is exactly what is needed to settle the problem from the point of view of the maritime provinces. There is at present confusion as to the powers of the board and as to the division of responsibility for the freight rates structure as between the board of transport commissioners and the government.
When the board of transport commissioners has completed the investigation which it has now been instructed to undertake, and has rendered a decision, all the inequalities or discriminations which may exist should be out in the open and be a matter of record.
In rendering its decision, the board will have to do one of three things. It will have to deal with these discriminations and inequalities in a satisfactory manner; or, secondly, it will have to refuse to deal with them by reason of the fact that it finds it lacks the power to deal with them or that it is restricted, under the provisions of the Railway Act, in the considerations which it is permitted to explore and to take into account in dealing with these matters; or, thirdly, it will bring down a decision which will be found unsatisfactory to the interested provinces.

It is my hope that the board will deal with all the outstanding questions in a satisfactory manner. That would be the object of the inquiry.	But if that is not the case, the
reason or reasons whereby it has been unable to deal with these matters satisfactorily will be clear to all. It will then be possible to refer any outstanding questions to the government in the sure knowledge that there can be no question in anybody's mind as to where the responsibility lies and on whose authority proper decisions must be arrived at.
I am therefore supporting the government and refusing to support the amendment and the amendment to the amendment for two reasons. One is the expressed and evident desire of the government to consider any appeal which it may be thought proper to make against the present order of the board. The second is that the decision of the government to refer to the board a full and complete inquiry is the quickest and the best method of settling the question of discrimination and inequalities, and of disposing, in the best and the quickest possible way, of any outstanding questions of divided responsibility and jurisdiction with respect to the question of freight rates, which, as has already been said, is one of the most important and serious questions we have to face at the present time.
Mr. W. CHESTER S. McLURE (Queens): Mr. Speaker, before beginning my remarks on this serious question of transportation and freight rates, may I be permitted to do something that will no doubt give rise to a smile on the face of the Minister of Transport (Mr. Chevrier). I should like to read a few items from a press report I have before me.


An hon. MEMBER:: About reefer cars?


Mr. McLURE:: You guessed correctly. This press report is dated Wednesday, April 14, and appears in the newspaper The Guardian of the Gulf. The heading of it is this:
Reefers now in excess of all demands.


Lionel Chevrier: Hear, hear.


Winfield Chester Scott McLure: Hon. members are smiling. The article reads, in part, as follows:
With 200 refrigerator cars on hand and with about 40 arriving daily, transportation facilities have at last caught up with island potato shippers' requirements and are even in excess of the demand, according to railway officials interviewed yesterday.
Then another item:
All through the season, strong complaints were voiced with regard to the refrigerator car shortage . . . No criticism was made with regard to the local railway officials . . .

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There is a great deal more to the item, but that is sufficient for me to read. Another item of interest reads:
Kingston, Ontario, April 13.
The first of 18 diesel locomotives being built for the Canadian National Railways left the plant here today.
That was on April 13. The item continues:
The locomotives are destined for Prince Edward Island.
Having been permitted to introduce my remarks by reading those items, I shall be content. There is a great deal more of them, but I have read just the important parts, and I shall be glad to hand the paper over to my hon. friend the Minister of Transport. It will save my writing him a letter as I did on a previous occasion.


Lionel Chevrier: Or asking a question.


Winfield Chester Scott McLure: No. I can assure the minister that if ever again there is a shortage or a near shortage, he will be bombarded with more questions.
The question of freight rates is, without doubt, probably the most important question that has been brought before the house in some time. Perhaps anything I say on this occasion will be more or less a matter of repetition. However, there are a few things I wish to touch on that are vital in connection with the problems of Prince Edward Island.
In speaking on this question a few days ago, I said it was my opinion-and nothing has yet been produced to change that opinion-that the board of transport commissioners have no authority to set fixed rates for the railways when, as I see it, the authority to fix those rates rests entirely with the government of the day. But they were entitled to make suggestions to the government; and then it was for the government to decide. I do not think the commission has the authority of a court. In fact, while they can bring in submissions to the government, I do not think the government should lose sight of the fact that they have the right to say, right there and then, either that they accept or reject them.
In this case, however, the Minister of Transport, acting for the government, seemed to be in a great hurry to put these increases into effect immediately without due consideration being given to the provinces that were most affected. In my opinion it would have been a better policy had the Minister of Transport listened to the protests that were immediately raised by the seven provinces of Canada in regard to what they called discrimination in reference to them. On this point I might say that I believe the premiers of the seven 5849-191
provinces will be in attendance here in Ottawa in the course of a day or two, but in the meantime this question may be definitely decided. Whether the vote goes one way or the other, the question may be definitely decided and the premiers of the seven provinces will not then have a hearing that is worthwhile.
As I said in speaking about the Canadian National Railways a few days ago, that railway is government-owned and, during the last few months, submitted a statement to the government pointing out that it could not operate under present conditions and asking for a thirty per cent increase in freight rates. The board of transport commissioners, after reviewing the case, come along and say, "No. We can recommend to the government a horizontal increase in the freight rates right across Canada of only 21 per cent".
Perhaps if another investigation were made, the next report would look at the finances of the Canadian National Railways and Canadian Pacific Railway Company in a different light, and we might have only a ten per cent horizontal increase right across Canada. Therefore I think the government were in too much of a hurry in bringing this matter up for an immediate decision. I think the government should have done as the premiers of the seven provinces had urged upon them, namely, wait at least thirty days until some further consideration had been given to the matter.
In reference to the railways, before this matter was really brought into the open, when I was speaking on the speech from the throne I urged strongly on the railway department that certain things should be done with reference to railway men in each province. For instance, I urged that there should be an increase in the pensions given to railway men, especially those who were in the lower wage brackets. I also urged that the men in the lower wage brackets should have an increase at an early date because some of them, from their low wage earnings, had not really sufficient money with which to live in a proper way.
However we are also looking for better transportation service from the railways; we are looking for better passenger service as well as better freight service. When we make those demands on the railway, we know that good transportation service requires good equipment and good facilities; and those in turn can be maintained only by economical operating methods and by proper charges for services rendered to the different provinces.
I give it as my opinion that if the railways cannot continue to operate and give us an improved service, then it is definitely up to the
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Winfield Chester Scott McLure: When the house took recess at six o'clock I was talking about the discrimination against our cash crop of potatoes. As hon. members are aware, this is a perishable crop as compared with wheat and it needs a great deal of care in storage and handling prior to shipment. I submit that the board should have given special consideration to our cash crop as has been given to the cash crop of wheat in the west.
When the Minister of Transport was making his able speech with reference to this subject a few nights ago he seemed to fear that if this measure did not carry as suggested by him there would be amalgamation of the two great railroads. I would remind him of the slogan that we used to hear at one time: "Amalgamation never, competition ever." We have no fear of amalgamation in Prince Edward Island because there is no competition as far as the railroads are concerned.
This is a serious question for our producers. For instance, our shippers were handicapped for a time last winter because of a shortage of reefer cars. If there is a shortage of cars in New Brunswick the people there can appeal to the Canadian Pacific and obtain the same number of cars that they would procure from the Canadian National. Since we have no competition, we are entirely in the hands of the government-owned Canadian National. I was glad to be able to put on the record that the Minister of Transport had been able to meet the need for reefer cars. However, as I said, if there were competition we could appeal to the Canadian Pacific when such a shortage arose.
The other night the hon. member for Royal stated that he had received a great many telegrams, letters and telephone calls from people in the maritimes. I think most hon. members from the maritime provinces have received scores of telegrams, letters and telephone messages demanding that the members from the maritimes stick together on this issue and fight to have it left as it was before, especially as far as the maritime provinces are concerned.
When the hon. member for Waterloo South (Mr. Homuth) was speaking on this question

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.the other night he said that in his opinion the great province of Ontario would be willing to pay its share of the cost of any revision of freight rates. I suppose it was quite reasonable for him to say that, because if there is a deficit to be paid by the government it would mean that Ontario, considering the amount of taxes which that province pays, would probably pay 50 to 60 per cent of the deficit.
While I can speak for only a few members from the maritime provinces, I know that they have received letters and telegrams from their own people, most of them complaining of a violation of the terms of confederation and the provisions of the freight rates act of 1927 as well as of the recommendations of the Duncan commission of 1926.
Apart from repeating what the hon. member for Royal has said, I have covered the ground pretty well. Prince Edward Island is differently situated from New Brunswick and Nova Scotia. Those provinces produce certain manufactured goods but there are few industrial plants in Prince Edward Island. Our province is largely agricultural. If this commission were making due inquiry into the conditions of our province with reference to the freight shipped therefrom I cannot understand why they should ask the government to nullify the provisions of the Maritime Freight Rates Act and the recommendations of the Duncan commission.
A demand has been made of most members from the maritime provinces that we implore the government through the Minister of Transport to delay this matter until the representatives of the seven provinces have had an opportunity to make their protests known to the government. I should like to read part of one telegram which I received, as follows:
We look to the members from the maritime provinces to fight for the restoration of our former position under the act.


Mr. J. R. MacNICOL (Davenport):: Mr. Speaker, many excellent speeches have been delivered on the question of freight rates, and I feel thab I cannot add anything new, certainly not along the lines that have been covered so far. I am going to approach this subject from another angle and shall endeavour to make a suggestion or two. If they cannot be considered now, perhaps consideration will be given them later on.
I have in mind quite clearly what the minister said in his excellent speech. When the minister speaks he presents his arguments in a plain, matter of fact way so that everyone can understand what he means. I have in mind clearly what he said. Three facts stand out: No. 1, that we must have railways; No. 2,
that the railways must have more revenue, and No. 3, that there should be more freight.
I have asked myself, Mr. Speaker, just what are the reasons for the railway situation in Canada being what it is, and answering that to my own satisfaction, I then asked myself: Are we forever to be facing the problem of increasing freight rates every few years? Is there not some method by which we can have at least some fixity of railway tariffs?
I am not going to blame the railways in any shape or form, or anybody else, unless I blame all of us who are members. I remember quite a few years ago-I was not a member then-I had to come to Ottawa nearly every week, and I used to go and sit in the railway committee room where often in those days plans were placed before the members for railway extensions here, there, and everywhere throughout the country. Those were the days of railway expansion. Those who represented the railways had to contend against the members of parliament of those days who were pressing their demands for a railway in this direction or in that direction, and naturally they recommended that the railway run through their own community or somewhere near it. The members themselves were being besieged by everybody back home to see that the railway ran in their direction. As a result of all this pressure, the railways were compelled to build lines which their engineers told them, and which they knew themselves, were wholly uneconomic. That is one of the burdens with which our railways, have been afflicted down through the years and which has put them in the boat they are in today. I will give just four examples in different parts of the country.
If you were to travel away to the west, Your Honour, in the direction of the Alaska highway, you would have to pass through Edmonton if you went by rail. The railway after it leaves Edmonton has its terminus at Dawson Creek, but at the time the railway was built it was never determined that Dawson Creek should be the terminus. The railway hardly knew where it was to go. If had to meet the requests of members of parliament, who wanted it to go here and wanted it to go there, with the result that it, was constructed as far as McLennan Junction, about 267 miles north west of Edmonton. There it divided, and one branch went to the west on the north side of the Peace river to what is known as Hines Creek, where it ended up in the woods. It could not possibly bring results to the railway so far as traffic was concerned. The other part of the road
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went on straight west from McLennan Junction. I do not believe at the time that the railway had any conception of where they were going to go, but they were being importuned by the members of parliament, and if I had been here I would likely have done the same as the members of those days did, supported the application for railway extensions into new parts of the country.
After McLennan junction you come in contact with a most peculiar situation. The railway, after a run of fifty miles, arrives at a place called Spirit River, and it ends there, ends nowhere, ends in the woods. When the road was projected toward Spirit River the intention was to proceed straight west, and the roadbed was built but not railed for another fifty miles toward a place called Pouce Coupe. But pressure was brought to bear on those building the road, and what happened? Today if you were travelling through that country, when you reached Spirit River you would find that the railway backs up five miles. It does not go forward; it does not even turn around; the whole train backs up to a place called Rycroft, because the pressure was excessive from the area now called Grande Prairie, a prosperous part of the country well worthy of a railway. At Rycroft the railway runs south for fifty miles, to an area quite foreign to where it had started for. Arriving at Grande Prairie, it runs northwest for approximately 100 miles to its present terminus at Dawson Creek. So every farmer and settler in that whole area is compelled to pay freight on an additional 100 miles and the railway is compelled to run its {rains that extra 100 miles to Dawson Creek. How can the railways pay under those conditions?
North of Dawson Creek is the only known area which can accommodate a great new immigration settlement, which has to come, for the railways must have more traffic, and the only way they can get it is by opening up the country. There is an area where perhaps 150,000 to 200,000 more farms are available for settlement. But unless something is done, the people who settle there will be compelled, for goodness knows how long, to pay freight on that extra 100 miles and travel that extra distance. I do not blame the railways for that, but it does add to their costs and reduces their profits. But they are not to blame for those conditions. It is we here who are to blame.
Having said that, I feel that any adjustment that is to be made to relieve the railways of these extra costs should be shared by the country at large, not just by the businessmen and merchants and people who are trying to carry on there.

Let me give another such example. Sup-, posing Your Honour is going to Flin Flon or to Sherridon, two great mining centres in a district that is opening up and growing very rapidly. It is on the pre-Cambrian shield, with much commerce by way of mining being conducted there. What happens? You take a train to Winnipeg and go away past Dauphin andi finally pass a place called Swan River. If you could only turn north from there it would be only 100 miles to The Pas, a fine city which is growing rapidly and destined to become great. It will be the centre of all that new mining area. But you cannot go straight north. You have to go away west to Hudson Bay junction. The railways had nothing to do with that. They were compelled to build that road which, like Topsy in Uncle Tom's Cabin, just "growed". Many of our railways just "growed up" without any relation to economics or traffic. That was not the fault of the railways. When you arrive at Hudson Bay junction you turn and go 100 miles northeast before you reach The Pas. In other words, you go another 100 miles out of your way.
So I am beginning to say to myself that the time has come for us to revamp the whole business associated with railways and give them a chance to live. They have not a chance under the conditions I have mentioned.
Suppose you were going to Arvida or Chicoutimi by rail, what would you have to do? First of all, you go west of Quebec city fifty miles. You go to a place called Riviere a Pierre. Then you turn to the north, and run 100 miles and come to Chambord. Then you turn to the right and run east fifty miles down to Jonquiere and Arvida and Chicoutimi. It is in the lower part of that part of Quebec, Jonquiere, Arvida and Chicoutimi, that the country is growing. It is a very great country, Your Honour, destined in my judgment to be a great industrial centre some day because of the cheap electricity that results from the vast plant at S'hipshaw and the vast waterpower resources which are behind it. Power can be developed there far cheaper than in any other place in the world. Therefore it is destined to become a great manufacturing country and a great agricultural country because up the Peribonka river, that country which was made famous by Louis Hemon in his book "Maria Chapdelaine" will be well settled. What does it mean? Until alterations are made there, it means that for all time the thousands and thousands of people who will settle in there will be compelled to go 100 miles out of their way because the railway just "growed up". It was not the fault of the railway. It was just extended to take in those areas.

Freight Rates
The hon. member for Cumberland (Mr. Black) was telling me yesterday-I have seen it myself; I knew something of it-that when the railway was being built on Cape Breton island there was a big debate in parliament on where they would run the railway from Mulgrave to Sydney. A great battle took place between those who wanted the railway to run in the centre of the island-I am not making any comment as to where it should have been run-or along the shore. It meant a distance of close to thirty-five or forty miles extra, via the centre route. Because of that, the fine city of Sydney, the coal mines and the steel plants there, have for years and years been compelled to ship their coal and steel forty miles farther than it was necessary for them to do. How can they compete against the world, as they have to do, when they have to go away out of their way? Not only that, but when you drive on the main line again you find that the railway is not where it should have been. It is not the fault of the railways. They were compelled to do things. Therefore, sir, I say that, not the maritime provinces, not the west, not Manitoba, but the whole of Canada must assume the burden of revamping the railways so that they will be in a position to carry freight at a lower rate.
I am not advocating the lower rate today. According to the board, the rates are too low. I accept the judgment of the board of transport commissioners. The minister said that one of two things would have to take place: either the railways would have to have a higher rate, or amalgamation of the two railways would have to take place. That has been advocated by some. I do not think it has ever been advocated by anyone who really understood the problem. Personally I could not support amalgamation of the railways. I am strongly in favour of the two railways. One is in opposition to the other, and each one meets the other and tries to do a better job.
If what the minister said is true we must choose one of two alternatives; either the rates must be higher, or we must accept amalgamation. Therefore it comes down to only one alternative, namely, higher rates. Having been in big business for many years, and having a keen conception of what freight rates mean to business, I say that increased freight rates at the present time would work a very great hardship on the maritime provinces-they are just trying to pull themselves together-and to British Columbia, also.
Therefore the problem is, what can we do? Something must be done. It is a problem to solve what can be done, because what the railways want is much more freight. If they had two or three times the amount of freight
they now have, even with the present rates, they would have a lot more revenue, perhaps enough to carry on. I do not know; it is not for me to say. But one thing is certain. They must have a lot more freight. They cannot get more freight by throttling business by higher rates in the maritime provinces. The maritime members have been saying what it would mean to their business to have higher freight rates, and I presume they are right. The British Columbia members in all parts of the house have said the same thing that increased freight rates would throttle their business which is struggling to go forward. I am inclined to agree with the members from the east and the west in that regard.
What can be done? That is the problem. We all admit that we must have the two railways. We all admit that the existing railways must have more revenue. There are only two ways in which they can get it, from an increased amount of freight or from higher freight rates. At the moment it is out of the question for them to get much more freight. I am going to submit a program which will result in much more freight, but it could not be worked out in a short time. Therefore I am going to suggest to the minister-it may be too late; I do not know whether it can be done now or not-to consider not putting into operation the new freight rates for some time. What would it matter if they were not put into operation for a year, provided that the government of this country, which I will support to do this, accept the deficits on each road resulting from the lack of the increased freight rates. That may not be possible. If that were acceptable- [DOT]


Lionel Chevrier: It is possible, but it is a tremendous amount. It is against the policy of the government.


John Ritchie MacNicol: The minister is a bright young man, and I am sure he would like to give the suggestion some consideration. In any event, that is all I can say. I suggest that he abandon the increased rates on the condition that the country accept the deficit of these two roads. It is only fair that the country should do that until such time as the whole matter can be threshed out, which will be quite a problem. I know what the minister is up against. It will be quite a problem to face the premiers of the seven provinces.
Since I come from Ontario, I wish to put myself square with the country. As a citizen of Ontario I am willing to do whatever I possibly can to help both the east and the west, and that is the only way we can overcome the difficulty. Since I am an Ontario
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member and a taxpayer, I would be willing to pay my part; I am sure the people of Ontario would be willing to pay their part, and I would think the people of Quebec would be willing to pay part of the cost to provide for the deficits of the two roads until the whole matter could be studied again. I am as satisfied as I am standing here that the whole railway problem must be studied again. I do not think it is right that the railways should be compelled forever to be up against what they have been in the past, and make these endless journeys and endless additional costs without reason, to do business in parts of the country.
The minister may not agree with what I am now going to say. I am going to ask him to reconsider the building of a bridge over the strait of Canso. I was a member of the reconstruction committee two or three years ago. I heard engineers of both the roads, I believe-if it was not of both roads it was the engineers of the Canadian National Railways-tell the committee that a bridge across the strait of Canso would save the railroads a million dollars a year. If that is so-I am not going to say whether it is or not; the minister would know much better than I do, because he is in a position to know, with those who are behind him advising him who should know-then it is up to the government of Canada to build a bridge across the strait of Canso without cost to Nova Scotia, New Brunswick or the railways. -By this means the railways would get business and we would get the money all back again. The steel would all be made there and it would be a splendid thing for the city of Sydney to be able to produce that million tons of steel. A great deal of work would result in that part of the country, and heaven knows the people there need it. I offer that suggestion as one which in my opinion the minister should seriously consider.
I have made extensive surveys of bridges. I know there are half a dozen going up across the Mississippi; at St. Louis and at San Francisco they have constructed two gigantic bridges costing roughly $150 million each. That program has been carried out in the last few years, and there are now projected at San Francisco two more bridges at a cost of $200 million each. The people in the United States have done this because the bridges that have been built have proved to be wonderful dividend producers.
I suggest to the minister that he should not hesitate to put into effect a program which would enable the Canadian National

to carry out such an undertaking as I have described. It would be an investment that would return dividends, because certainly the building of a bridge across the strait of Canso would be one means whereby the yearly deficit could be cut down, to the extent of one million.
There is another suggestion I have to offer. I have been across the prairies many times, and it is my judgment that the western provinces have never had a square deal, nor have they had the chance of securing a square deal. It is not that they have not tried hard to get it. The railroads running through the prairies for perhaps a thousand miles pass through half a dozen communities, at most ten communities of any size producing freight. They carry wheat to the east, with very little freight going back, and the result is that the railway companies are faced with a colossal expenditure. This is not fair to these companies.
We must try to solve the problem that faces us in that respect. How are we to solve it? We should do the same for the west as for the maritimes-expand their industrial activities, both primary and secondary. So far as the west is concerned, I read only today that it may be ten years before the dam is constructed across the Saskatchewan river at Riverhurst or somewhere in that vicinity. If it were in my charge to build a dam across the Saskatchewan river, I would do it in a great deal less than ten years.
I have had a good deal to do with many dams, and in my judgment that is one thing which has to be done if we are to give the west a chance to produce freight. They are producing too little today in that part of Canada, not because of any inherent inability on their part. It is not their fault, because they cannot produce without water. The water is there simply flowdng into Hudson bay to make more ice.
If the increased rate of 21 per cent across the board were left off for some time, it would give the country an opportunity to get together and solve this gigantic railway problem, which must be solved in any event, because we cannot go on forever having an application every few years for increased freight rates. Let us have the problem settled once for all. I have suggested one or two ways in which it might be helped.
I do not want to take up much more time because I know the house is anxious to get the vote, but I have one or two more suggestions to offer the minister. He is a bright man, as I said to my deskmate yesterday. I should not like to say that he is the brightest on the government side but I spoke very highly of him to

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my deskmate, and as one who is a good deal older than the minister, and who has been in big business and has seen many big business problems solved, I wish to make a suggestion or two to him. I have seen a small plant grow from the stage at which it engaged very few men until it became a large organization, and this was the result of careful business operation.
I would say, if I were in the minister's place, that this problem ought to be solved not so much from the point of view of raising freight rates as by means of the rehabilitation of the railways themselves, by doing that which will give them the chance that they have not had of increasing their freight carriage. And I would do this by opening up the country so as to produce more freight. One has only to travel in order to see the results that follow from such a program. One has only to consider such a railway as the Chicago-Burlington-Quincy, which runs up the valley of the Platte river, passing through forty towns and cities, all rich and thriving communities. That resulted from the rehabilitation of that area. We have distances two or three times greater in western Canada, and we might have not forty or fifty but sixty new cities and towns which would all produce so much more freight.
That is one of the requisites of our railways. We must produce more freight, and how can the railways get more freight unless we open up the country, build new communities and expand our manufactures? In this connection, I may say that on some other occasion I shall submit for the maritimes a program which, if carried out, will double the population of that part of Canada in a period of fifteen or twenty years. That would mean a great deal more business for the railways.
These remarks I have made tonight have been offered in the friendliest spirit without any intention of criticizing. I simply wish to have the minister take into consideration the necessary means of increasing the freight potential along our railways and reducing the cost of operation by eliminating long nuisance hauls that get us nowhere. If he would do that it would be all to the good of the country.
As an Ontario man, I think I can speak for the people of this province when I say that in a sense we really live through the co-operation of other parts of the country. There is in Toronto a population of nearly one million, and the men and women in that city are engaged in the production of commodities, the raw materials of which come from outside the city. There is nothing in Toronto from which we can make the things we produce there. We import them into the city and our people
convert them into finished goods. Such a program as I have suggested would mean increased returns for us. It would develop other parts of the country and it would mean more freight for the railways.
That, I suggest, would be a good deal sounder than a large increase in freight rates.
I am not saying that it is not necessary to have more freight revenue at the moment. How it will be done I do not know. I am not advocating higher rates. I am advocating the other program of building up the country and bringing in more people and making more freight.
Earlier in my remarks I referred to the country north of Peace River. I have been through that country, hundreds of miles of it, and it was not easy travelling. Sometimes I went on horseback; much of my travelling was on foot. It is a wonderful country. I would call it the last place in the world for Anglo-Saxons, French-Canadians and people of our stock to settle in. But I am sure you could settle two million people there if you provided the facilities, and that would mean a great deal of freight for the railways. That is what they want-more business and more revenue through increased business. If they had more business they would not have to come here every few years for increased freight rates. My last word will be this; High freight rates will throttle instead of encourage business.


Mr. BENOIT MICHAUD (Restigouche-Madawaska):: Mr. Speaker, I need not apologize for taking part in this debate. I may say that I was particularly prompted to do so yesterday when I heard the hon. member for Royal (Mr. Brooks) throw out a challenge to the maritime members, particularly those from New Brunswick, sitting on this side of the house. Lest my silence be improperly interpreted, I think I had better state clearly what my stand is in this important matter. It would not be the first time that New Brunswick newspapers and politicians criticized Liberal members of this province for their silence in some of the debates in this house. In the past, however, matters were so trivial that they could be laughed at. This time I consider the subject a serious one; hence my remarks.
Before dealing with the challenge issued by the hon. member for Royal, perhaps I had better read what he said yesterday. As reported at page 2963 of Hansard of April 14, he said:
I appeal to these members of the House of Commons to stand up and support what they consider to be in the best interests of the maritime provinces. I do not think these men were enthusiastic before they attended their caucus tha other day.
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Then the hon. member for Souris (Mr. Ross), with his usual timely interruption, had this to say:
Mr. Ross (Souris):	They always swallow
themselves.
Then the hon. member for Royal continued:
Mr. Brooks:	I should like to know what happened in the caucus.
And then he went on along that line. I wish to take issue with this reference by opposition members to a change or so-called change of attitude on the part of Liberal members following this caucus. They surmised-and as usual they are wrong-that the boys had been told to fall into line. It is no wonder that members of the opposition come to -that conclusion and openly express it. That is obviously the way things are run in their own caucus-


Some hon. MEMBERS:: Oh, oh.


Benoît Michaud: -and they cannot conceive of a party discipline different from their own. Let me tell these wishful thinkers that once again they are all wrong and that their vicious insinuations are without any foundation whatever.
I am sorry that I cannot hear the interruptions from that far corner of the house.


Mr. CARDIFF:: Speak about something you know about.


Benoît Michaud: I do not believe they add any great contribution to the debate, in any event. If we look at this aspect of the situation from an unbiased point of view, what ground is there for opposition members to make these unfair insinuations? What ground is there for any member on the other side of the house to insinuate that the boys were told to fall into line? Has there been a single member on this side of the house who, at any time in the course of the debate, intimated that he might vote for that far-fetched motion of non-confidence? I have listened to or read most of the speeches, and I am unable to find any statements made on this side of the house which would warrant the belief by anybody on the other side that any member on this side could possibly fall for such an awkward and deceptive trick as this nonconfidence motion.


Mr. McCULLOUGH (Assiniboia):: Particularly awkward.


Benoît Michaud: On the other hand, I am not greatly surprised that some members of the opposition resort to such tactics. They must try in some way to camouflage their utter lack of serious arguments to defend this amendment, which is just as much out of

place on the present motion to go into supply as it would have been before the Easter recess. There is no more foundation for this amendment today than there would have been three or four weeks ago.
Like many of the other criticisms of the opposition that have been levelled at the government, this one is bound to have a short spell of popularity. When we came to the house last December, the government was indicted by the opposition on several counts. Foremost of all was the failure to devaluate the Canadian dollar. We have not heard so much about this of late, and I do not believe we are likely to hear very much more, following this report of the Bank of Nova Scotia, which report originated in Toronto, and which, I believe, gave the coup de grace to that much vaunted panacea of devaluation.


Arthur Leroy Smith: The hon. member is reading from the wrong speech.


Benoît Michaud: Then there was the count as to the removal of the subsidies on coarse grains. We heard about it for weeks and weeks. I imagine that it is fairly well worn out by now, and that we are not likely to hear about it any more. The situation is fairly well under control. There are other subjects of criticism which have passed into oblivion so rapidly that, when one comes to think of it, he wonders how it comes about that subjects of criticism of that kind should be of short duration. This one with regard to freight rates will also wear out, and I dare say it will do so quite rapidly.


Mr. PROBE:: You hope.


Benoît Michaud: The government has been criticized-


Mr. BRYCE:: Tell us about potatoes.


Benoît Michaud: I am sorry but I missed the interruption of the hon. gentleman. I do not believe, however, that it adds a great deal to the debate. This afternoon the hon. member for Muskoka-Ontario (Mr. Macdonnell) accused this government of neglect, of allowing this situation to develop with regard to the' railways. But unfortunately he did not point out wherein the neglect lay or how it came about that the government allowed this situation to develop. The government does not interfere with the running of the railways.
I fail entirely to understand just what he means by that; and, in view of the fact that he did not care to go into detail, I dare say that possibly he himself is not quite sure just what he means by making those attacks on the government.

Freight Rates


Arthur Leroy Smith: He thought you could understand the object, but apparently you can not.


Mr. COTE (Matapedia-Matane):: He was presumptuous.


Benoît Michaud: Unfortunately we are not all endowed with the same amount of intelligence and ability as some hon. members on the other side of the house think they are endowed with.


Arthur Leroy Smith: Thanks for the compliment.


Benoît Michaud: Let us come now to the challenge of the hon. member for Royal. I wish to tell him and all other hon. members that I am not afraid to take a stand on this question. As a matter of fact, I had made plans to go away yesterday; but for fear that I might be accused by some of our good friends across the way of running away and dodging the issue, I decided to stay here until the matter is finally disposed of.


William Scottie Bryce: Face the music.


Benoît Michaud: There would be no advantage in my repeating some of the arguments which were presented so ably by the Minister of Transport (Mr. Chevrier) the other day. I should like, however, to say just one word as to the utter futility and inopportunity of this debate under present circumstances. To my knowledge, nobody in this house has denied that the railways need the extra money in order to carry on and grant promised increases of wages to their employees. I am not aware either that any objection has been taken to the recent decision of the government to require the board of transport commissioners to make a thorough investigation into the rate structure. As a matter of fact the hon. member for Royal, when questioned by the Minister of Transport, admitted that both steps were justified.
If the complaints of the maritime and the western provinces in regard to freight rates are justified, as I believe they are, this is solely on the basis that, because of numerous considerations which have been placed before the house repeatedly during the course of this debate, historical and economic considerations, they should have lower freight rates than the central provinces. In my opinion that is the problem in a nutshell. That principle was recognized some twenty years ago as far as the maritime provinces are concerned. At that time the Duncan commission recommended lower preferential freight rates for the maritimes, and in 1927 those recommendations were implemented by means of the Maritime Freight Rates Act, which established rates 20 per cent below standard on the bulk of the traffic. This preferential rate has endured for more than twenty years. Whether or not it is still equitable under present circumstances, I am not in a position to say. I would venture to suggest, however, that it is no longer equitable, and that the preferential should be increased to at least 30 per cent below standard. If that were done, according to my calculation the recent increase would amount to only about five per cent as far as the maritime provinces are concerned, and I presume there would be no particular objection to such an increase.
Let me repeat that in my opinion the only consistent attitude for maritime members to take on this matter of freight rates is to press for a further reduction under the Maritime Freight Rates Act. This should be done by way of amendment to the act, not through this ill-timed non-confidence motion. What bothers me with respect to the criticism of the hon. member for Royal is the fact that the situation of which he complains is not a recent development. The hon. member has been in this house since 1935; as a matter of fact he was the only Conservative member returned from the maritime provinces in that election. Not having been here as long as the hon. member, I do not know what if anything he has said or done in the past on the floor of the house with regard to having maritime freight rates further reduced. This argument applies also to the other opposition members from the maritime provinces, though not to the same extent since they have not been here so long. However I do not recall any great pressure being exerted since 1945 by those hon. members with a view to having freight rates in the maritime provinces further reduced.
This afternoon the hon. member for Charlotte (Mr. Stuart) made an interesting suggestion, to the effect that manufacturers throughout Canada should sell their products at a uniform price delivered to the consumer in any part of Canada. He pointed out that this is being done now by some industries in the maritime provinces. I wmnder how many of our good friends from Ontario, particularly on the other side of the house, would do something to promote this suggestion. I dare not venture an opinion as to the extent to which it might be practicable. Possibly it might be adopted in reference to commodities in which the freight rate bears a low ratio to the value; but if it came to coal and lumber and steel I doubt very much whether the suggestion could be carried out.
In any event, if there are grievances in the maritime provinces, as I believe there are,
Freight Rates

I repeat that the solution is a further reduction of freight rates in the maritime provinces. In my opinion it would be the quintessence of irresponsibility for a government to interfere with the judgment of a judicial body set up some forty years ago, with which thus far no government has dared interfere. There would be no more justification for the government to interfere with a judgment of the board of transport commissioners than there would be for it to interfere with a judgment of the Supreme Court of Canada.
For these reasons, Mr. Speaker, I shall have no hesitation in voting against both the amendment and the subamendment.


Edward George McCullough: Mr. Speaker, I rise to add my voice to those who have spoken in opposition to the imposition of a 21 per cent increase in freight rates. I was astounded to hear the decision of the transport board to allow this increase, but I was even more than astounded when I learned the government intended to disregard the request of seven premiers that the federal government stay the order of the board for thirty days until they could make their representations. I feel that this was a betrayal of the democratic principles of this country. At this time, when we are trying to promote peace and unanimity across this country, I think it was poor judgment on the part of the government to permit an action of this kind which imposes real injustices and inequalities upon certain sections of the country. The increased freight rates will make it necessary for many of our labouring people to demand new wage increases, because British Columbia, the three prairie provinces and indeed the maritime provinces will all find the cost of living going up, due, both directly and indirectly, to these new freight rates.
I do not say that there should not be a thorough investigation into the question of freight rates, or that the railway companies are not justified in asking for a revision of rates if they are in any danger of becoming insolvent. The hon. member for Restigouche-Madawaska (Mr. Michaud) stated a few moments ago that he did not consider this debate timely. I quite agree that for some hon. members it is not timely, and indeed is embarrassing, but I believe the leader of this group has done the people of Canada a real service in bringing about a debate in this house on the action of the government in upholding the decision of the transport board to increase freight rates by 21 per cent.
In view of what the hon. member for Restigouche-Madawaska has said, I should

like to quote the amendment which is under discussion today. The amendment moved by the leader of this group (Mr. Coldwell) is as follows:
That all the words after the word "that" to the end. of the question be deleted and the following be substituted therefor:
"this house is of the opinion that the failure of the government to defer the imposition of the increases in freight rates recently authorized by the board of transport commissioners is inimical to the best interests of the people of Canada; further this house is of the opinion that the government should reconsider this matter and take action to prevent the proposed increases from coming into effect at this time."
Later on, the official opposition moved a further amendment which is quite in keeping with my own sentiments and which reads as follows:
That all the words after "this house" in the fourth line of the amendment be deleted, and that the following be substituted instead thereof:
"regrets the government's failure to secure the .removal of inequalities and discriminations in the Canadian railway freight rates structure before the imposition of a horizontal increase of twenty-one per cent-an increase which is bound to intensify the aforesaid inequalities and discriminations, and
Further regrets that the government has refused the reasonable request of seven provinces that the imposition of increased freight rates recently authorized by the board of transport commissioners be delayed for thirty days until they could be heard."
I think that is a reasonable request. We should have democracy in this country because that is what we fought two wars for. It is what we have been trying to build up in this country. Before this we have had the premiers of the different provinces coming to Ottawa to attend dominion-provincial conferences and attempt to bridge any gaps which there might be in our Canadian way of life. They have tried to come to agreement with the federal government, so that details of the British North America Act and other constitutional enactments might be threshed out in a democratic way and bring harmony to this country. But here we have action on the part of the government which has aroused anger from coast to coast. As long as I have been in politics I have never known of an issue which has so much aroused the people of my province.
We are not in disagreement with the right of the railroads to demand an increase if they need it, but I want to say first that the whole freight rate structure should have been thoroughly investigated. If further revenue were needed, then it should have been granted on a basis that was fair and equitable across the country. I should like to quote

Freight Rates
the statement made by Mr. Macdonald in his submission to the transport board. Referring to the revenue of the Canadian Pacific, he said:
The Canadian Pacific railway is thus, on our contention, in a position to pay all of its dividends, all its fixed charges and provide all of the $15" 2 million for additions and betterments, and' leave a surplus of almost $10 million.
I listened with great interest to the Minister of Transport (Mr. Chevrier) when he spoke the other day. I thought he was going to give the whole railroad picture, but in my opinion he failed to tell the house one of the most important things. He said nothing about the profits and the surpluses set aside by the companies to provide for the betterments referred to in their submissions.
I agree with the Minister of Transport when he says that we need able men on the transport board if we are to have a proper investigation, but I feel that it does not take great intelligence to realize that, when injustice and inequality already exist in the freight rate structure, by imposing a further horizontal increase on those existing inequalities you simply increase the burden on a large number of people. I know I speak for the farmers and people of Saskatchewan when I say that all we want is fairness and justice. I do not think that is any more than a democratic institution should give to the people.
The cost of living is increasing all across the country. The veteran who is trying to rehabilitate himself finds it more difficult to get along. There have been further increases brought about by the new rate schedule. We find that on the off-lines the new schedules will apply. It will be only on the transcontinental lines that there will not be any increase in freight rates. Next we find that the minimum weight will be 100 pounds. For example, the cost of shipping a crate of eggs will be increased from 35 to 75 cents. This will decrease the income of the women on our farms who have been shipping eggs and milk and cream.
I have listed what I believe are eight important aspects of this situation which affect the western farmer. It should be understood that the western farmers are the greatest consumers of manufactured products in Canada, particularly farm machinery. The special committee on farm machinery which sat in 1937 found that there was a great backlog of demand for farm machinery in western Canada. During the hungry thirties few farmers were able to buy farm machinery and a backlog of about $50,000,000 of demand was built up. Then during the six years of war with large quantities of steel going into war equipment the farmers found themselves still unable to get farm machinery.
I think this is an instance where a large company has influenced the transport board and the government in order unjustly to impose a situation upon the farmers. The demand for farm machinery in western Canada has now reached a total of from $00,000,000 to $70,000,000 a year. These increased rates will mean a tremendously increased cost, and I have calculated what this additional cost will mean to the western farmer.	*
If we estimate the annual requirements at from $60,000,000 to $75,000,000, plus $15,000,000 for necessary replacement parts, this gives a total of from $75,000,000 to $90,000,000. According to the 1937 special committee, 7-4 per cent of the cost of farm machinery is made up of freight. That would mean about $5.55 million each year. If we estimate the freight from distribution centres like Regina to the local points as being one-third of the freight from the factory to the distribution point, we find that the additional cost will be from $1.85 million to $2.22 million. The 21 per cent increase in freight rates will cost the western farmer in connection with his machinery requirements an additional $1.55 million to $1.86 million a year. That is a tremendous amount of money. Here we have the farmers who are operating on a flexible income which has no stability at all put in the position where it is difficult for them to determine when they buy machinery whether their income next year will be sufficient to allow them to pay for it.
The representations made by the railway companies were based to a large extent on the revenue which they expect to get in the future, and it is interesting to note in that connection just what the Canadian Pacific Railway Company did submit to the board. In their submission the Canadian Pacific Railway Company said that their revenue in 1947 would be about $285-4 million. Actually it turns out that their gross earnings that year were $318-6 million, or an additional $34 million. This shows that the Canadian Pacific Railway Company is in a very liquid position, after allowing for fixed charges, income tax, dividends, additions and betterments, and reserves. Again we find a net increase in 1947 over 1946 of $2-1 million. In other words, the net income of the Canadian Pacific Railway Company increased from $20-8 million in 1946 to $22-9 million in 1947.
I consider that the federal government has given the seven provincial premiers who have tried to co-operate with this government a slap in the face. All I am asking is that the government rescind its action and stay the application of these increased freight rates until it
Freight Rates

has heard the representations of the provincial governments. That would lead to co-operation between the provinces and between the people of Canada. If the railways need additional income to pay decent wages to their employees, let them have it on the basis of equality of rates all across this country. We have already had enough of situations that would break the east away from the west, and the west away from the east. Let us now try to build for unanimity and co-operation across this country. If there is a single thing that will cause fresh labour disputes and demands for increased wages and make it more difficult for the veteran and the farmer and all of us to go ahead in this peacetime economy, it is this very action. I think the government was very ill-advised in- taking the action which it did.


Mr. D. KING HAZEN (Saint John-Albert):: Mr. Speaker, the people of the constituency I have the honour to represent in this house, like the people in every part of the maritime provinces, have been seriously perturbed by the judgment of the board of transport commissioners granting the railways a 21 per cent horizontal increase in their freight rate structure. It is for this reason I want to say a word or two in this debate.
I do not think any useful purpose would be served by my referring to and setting forth again the protests that were made by the premiers of New Brunswick, Nova Scotia and Prince Edward Island, all of whom are, I might say, supporters of the Liberal government. Nor do I think it would be of any advantage for me to take up the time of the house by reading the protests that were made by the maritime transportation commission, by the maritime board of trade, by other organizations and by the press of the maritime provinces. All those1 protests have been brought forcefully to the attention of the minister and the government and to repeat them again at this stage of the debate would be merely a waste of time.
I should like to preface what I have to say by quoting from the report of the royal commission on dominion-provincial relations, known as the Rowell-Sirois report, which was made on May 3, 1940. At page 91, volume II of that report, the commission says:
New Brunswick shares with Nova Scotia the unhappy distinction of the longest unfavourable economic history of any Canadian province. The inferior character of many of the province's resources, and transportation and marketing difficulties, have retarded economic progress and created chronically impoverished areas and distressed industries.
This is not a happy or a wholesome picture or a condition that we would like to see eon-

tinue. The maritime provinces complain that, compared with other Canadian provinces, they have a lower standard of living, a higher cost of production and higher marketing costs, and that these unfavourable conditions under which we have laboured have been made worse by the decision of the board which was handed down on March 20, last, In this connection I should like to quote, and to make his words my own, what was said by the hon. member for Queens-Lunenburg (Mr. Winters) in this debate yesterday afternoon. He said, as reported at page 2920 of Hansard:
There is no question that the increase in freight rates will be a severe and adverse blow to the maritime provinces as well as to the west. Even at the old rates it was almost impossible for our industries to put their products on central Canadian markets at competitive prices. To be in a competing position, it was necessary not only to aim at wages more moderate than those prevailing elsewhere but to keep our other manufacturing costs down. What small measure of success we have had indicates that we have achieved both these aims to some extent. Now, however, the higher freight rates place another obstacle in our path. They will tend to make us live within ourselves in an industrial sense more than ever before.
I have no hesitation in saying that the railways of this country must have an increased revenue if they are to carry on. There is no question in my mind as to the need for this being done. I do not intend to give the reasons I hold for having that opinion. These reasons have been given in the house on a number of occasions during this debate. It is not the increase in revenue but the manner in which the board has decided that these revenues are to be obtained to which objection is taken in the maritime provinces.
A memorandum of the maritime transportation commission on the judgment of the board of transport commissioners states that the board found a straight percentage increase is the only manner by which general increases can be applied. If that is a fact, then I say it is a most unfortunate state of affairs in the maritime provinces.
I wish to say a word or two about the plan of the government to have the board investigate the freight rate structure of the railways. I was surprised at a statement made by the Minister of Transport (Mr. Chevrier) in this house on April 13 during the course of his speech. He said, as reported at page 2908 of Hansard:
This is a motion to go into supply, and my hon. friend has decided to move an amendment to the motion in order to expound a grievance, something which he has a perfect right to do. But I submit that before that grievance was expounded the government had made the grievance disappear by ordering a thorough and complete investigation into the railway freight struc-

Freight Rales
ture by the only board competent and efficient to deal with the question. The government has moved to have the situation righted by this investigation.
If we can make grievances disappear by referring them to any board, then this country would be a country very easy to govern and it would be a happy land in which to live. But, sir, the only way to deal with a grievance is to face it, and the only way that a grievance can be rectified is to solve it. To refer a matter to a commission and think you will solve the grievances of the maritimes or the west or of any other province in that way seems to me to be utter nonsense. The order in council provides for an investigation of freight rates by the board, and it reads as follows:
Order in council P.C. 1487, approved April 7, 1948: directing the Board of Transport Commissioners for Canada to make a thorough investigation of the rates structure of railways and railway companies which are under the jurisdiction of parliament, with a view' to the establishment of a fair and reasonable rate structure which will, under substantially similar circumstances and conditions, be equal in its application to all persons and localities in the various provinces and territories of Canada.
I must confess that when I read that order in council I was puzzled by it. I failed to understand what it meant, or what powers the board was given under it. I believe now, after making a hurried examination-and that is all I had time for-of the Railway Act, that the wording has been adopted from section 314 of that statute which is headed "Equality as to Tolls" and so on.
This board is not all-powerful. Its powers are limited by the act that created it. The board, under the act, as I read it-I do not profess to be an expert in these matters, and I would ask to be corrected if I am wrong- has no power to fix rates that will assist an industry to develop and function. It has no power to fix rates that will remove handicaps under which many maritime businesses function on account of their geographical situation or distance from central markets. It has no power to fix rates that will develop business in the maritime provinces. It has no power to adopt experimental rates. Its powers are limited, and this move of the government in referring the matter to the board is, in my opinion, a political expedient to put to one side a difficulty the government does not want to face up to.
The senior member for Halifax (Mr. Isnor), when speaking in this debate yesterday, said as reported at page 2957 of Hansard:
I cannot help believing, however, that there has been a slip in the wording of the minister's order. In some of the judgments the board takes the view that it cannot handle questions relating to trade.
Well, sir, if there has been any slip in the order, let the minister have it corrected. In my opinion, however, there has been no slip. The wording was deliberately and carefully made, and the powers of the board are, of necessity, circumscribed.
The royal commission on maritime claims, which was headed by Sir Andrew Rae Duncan and had as one of its members Doctor Cyrus Macmillan who for some time occupied a seat in this house, made its report on September 23, 1926. In its report it refers to the limitation of the board's powers. I propose to read into the record a paragraph from this report under the heading "Scope of the railway commission's functions". I do so because I think it is a matter that should be given further study by the Minister of Transport, by his assistants and by the government. This it what the report says in part on page 24:
In addition, the cases which the maritime provinces have already submitted to the railway commission also raise the question of handicaps arising from the geographical position of their natural products, and their distance generally from central markets. If we W'ere satisfied that under their present power the railway commission could adequately deal, on appeal, with the broader aspect of the maritime cases before them, we would make no further comment.
Previous judgments of the railway board, however, lead us to fear that they will not feei competent to deal with such broad considerations as are still involved in these maritime claims. We cite, in particular, the following extracts from the board's judgments: (volume 13, pages 260-261, application of district board of trade, Coalhurst, Alberta.)
"The board, under the railway act, has no profit and loss responsibility, and its intervention in the matter of rates must, as has been indicated, be concerned with matters falling within the categories of reasonableness and unjust discrimination, and not with a policy of the development of industries through rate adjustments.
(Imperial Rice Milling Company v. Canadian Pacific Railway Company, 14 Canadian Railway Cases, 375.)
"The board has no power to regulate tolls for the purpose of equalizing cost of production, or geographical, or climatic, or economic conditions. (British Columbia News Company v. Express Traffic Association, 14 Canadian Railway Cases, 178.)
"It is not the board's function, as delegated by parliament, to make rates to develop business, but to deal with the reasonableness of rates, either on complaint or of its own motion . . . As it has not been established that the rates as charged are unreasonable, the board is not justified in ordering the installation of the experimental rates asked for."
The report goes on:
The conclusion to be drawn from these extracts seems to us to be that the railway commission does not feel itself empowered to pass under its review, when appeals are made to it,
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the same wide range of business considerations which railway companies themselves can take into account in forming a judgment as to the extent to which they should develop trade and business.
The report goes on to state:
At present the work of the railway commission is circumscribed within the two considerations, viz. (a) reasonable compensation to the carrying company, and (b) no unfair preference or unjust discrimination as between traders.
The report then refers to section 320 of the Railway Act which, it says-
. . . seems to give the wider powers that we have in mind to the railway commission, so far as the question of undue preference or unjust discrimination may be involved.
It quotes the section. I am not going to do so, but I have compared the section as set out in their report with the section as it appears in the act as it now stands, and I may say there is no change. It quotes the section and says:
Even there we feel that, if the intention was to have larger national interests in mind, the section should be made clearer, and instead of the words "in the interests of the public" (which might be interpreted as in the interests of the "consuming" public), the words should clearly state that it is national interests (both "producing" and "consuming") that are in mind.
The judgment of the board came before the maritime transportation commission in Moncton on, I believe, April 9; and after considering what the government had decided to do, the commission sent a wire to the Prime Minister (Mr. Mackenzie King) and a copy of that wire to the Minister of Transport. In that wire it said that the action of the government in referring this matter again to the board was throwing a red herring across the trail. What it had in mind, I believe, when it made that statement were the sections of the act and the powers of the board to which I have just referred.
Perhaps I might take the time of the house to say just what the wire of the maritime transportation commission to the Prime Minister stated. I do not propose to quote it all. It states that in its opinion the spirit and terms of the Maritime Freight Rates Act have been violated, and in addition to that it points out that the effect will be that maritime industry will in many cases, be seriously affected and, in some cases, destroyed. It points out that in using the word industry it refers to agricultural as well as other industries, and then it states:
We feel that the proposal to hold a general freight rates investigation is simply a red herring across the trail. In the very nature of things it will require at least two years-
[Mr. Hazen.j
The Minister of Transport told us it might take a shorter time, six months I believe, or a little longer.
-as did the general investigation of 1925 to 1927, with little or no result.
The wire goes on to say:
We feel that your government should consider the matter outside the railway act because of its economic and political implications. When we consider that seven provinces in this dominion are aligned against this decision and only two are not opposing it, due to their geographical and special locations and their advantages over the other seven provinces in mass production and protection under Canadian tariff, we think you still appreciate the very serious questions that have been raised by this issue.
I think the long and short of the matter is that once these rates are imposed, and they are now imposed, it will be very difficult to get any change. I do not wish to read again the order that sends the matter to the board of transport commissioners, but I am still puzzled and I should like the minister, when he replies, to tell us just what powers the board have, just what they can do after they have heard the matter, and what will be the effect of their decision.


Lionel Chevrier: I may tell the hon. member now that they have power to equalize rates but have not the power to fix prices or to realign the boundaries of the country as he would like.


Douglas King Hazen: Perhaps I might say another word or two. I will refer to the order again, order in council P.C. 1487, approved on April 7, 1948. I read it because, as I say, I do not understand it.


Mr. GRANT:: That is repeating.


Douglas King Hazen: It reads:
. . . directing the board of transport commissioners for Canada to make a thorough investigation of the rate structure of the railways

That is plain enough.
[DOT]-and railway companies which are under the jurisdiction of parliament,-*
I can understand that.
-with a view to the establishment of a fair and reasonable rates structure . . .
Who is going to establish the rates structure?


Lionel Chevrier: The board, upon evidence,
I presume.


Douglas King Hazen: Will that be by the board or by the government?


Lionel Chevrier: It is not the business of the government to fix rates. I explained that in my remarks the other evening. Nor is it

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the business of the government to equalize rates. It is the business of the board.


Douglas King Hazen: Another thing that puzzles me is this.


Thomas Vincent Grant: Read it again.


Douglas King Hazen: The review of this judgment by the maritime transportation commission says the board found that a straight percentage increase is the only manner by which general increases can be applied. Having found this, how in the world are they to change their decision, in view of all the evidence that has been brought before them? How are they to change the decision and make any other one or devise any other method of raising revenues?


Lionel Chevrier: If I may answer that, because the application by the railways was one for an increase and the provinces did not appeal in regard to equalization. On the contrary, they clearly stated that they were not launching an application for equalization but that they would do that at a later date.


Douglas King Hazen: I am still puzzled by one thing, and perhaps the minister can clear this up. I have here a statement made by the Premier of New Brunswick, Hon. J. B. McNair, after the judgment was announced; and in the course of the statement he issued to the press he says:
The maritime transportation commission, acting on behalf of the provinces of New Brunswick, Nova Scotia and Prince Edward Island made strong representations to the board that if increases were to be made in the freight rates structure such increases should not be flat or horizontal percentage rate increases but in effect should provide for lower rates on primary products. The board in its judgment has not seen fit to comply -with our representations with the exception of rates on coal and coke.
How do you explain, that?


Mr. L. PHILIPPE PICARD (Bellechasse):: The discussion arising out of the amendment now being considered, Mr. Speaker, is most important, not only because any change in railway freight rates is bound to have a heavy repercussion on the economic structure of the country, but also because it forces upon us once more the fact of our interdependence with the United States. Because the United States were not successful in applying controls to trade and industry and because political pressure bore too heavily on the Washington administration, controls there were removed, and prices which were already on the way up, skyrocketed to unprecedented levels. Inevitably we felt the shock, because our economies are interrelated, because our importations
affect so many varied lines of business, because so many Canadian goods or machines cannot be completed without the importation of some component parts from the United States. The inflation already existing in the United States rendered so difficult and so complicated the controls of prices here that government advisers decreed that we also should abandon controls. Good excuses were found: necessity to revert to democratic ways and practices; even provincial rights were invoked. The real reason was our dependence on United States economy.
The ruling of the board of transport commissioners that caused the present amendment to be introduced is in direct relation to the removal of controls and the high cost of living, and it will eventually help in raising the latter more. In a moment I will say a few words about the decision itself; but the main object of my remarks is to point out that we adopt, all of us, the attitude of the ostrich when it comes to facing the fact of our economic plight. We did it on the measures for exchange control, for United States dollar conservation, for importation restrictions. We are still doing it.
The trouble is that we have always had a dependent and subservient economy and we carry on, suffering from this condition. We are subservient to Britain and dependent on the British market and the fancies or ingratitudes of British governments, and subservient to the United States and dependent on its price structure, its inflations or depressions. It would not be half as bad if, besides the inconveniences resulting therefrom, we would benefit as much as they do on other occasions and share their prosperity and attain their per capita income.
If we all awoke and realized that stark realities are calling for leadership and courageous decisions we would spend less time in exalting parochialism, in defending east-west forced economy or the long narrow ribbon of railway siphoning goods from the centre to the extremities of the country, and we would start right away to negotiate not only a customs union but a full commercial union which would make all of America north of the Rio Grande an integrated economic unit. We might then still have many of our troubles to face, but we would also have the compensations and the broader life and more rational economy which would result from regulating our trade, not by sentiment or by so-called nationalistic pride but according to geographic, climatic and ethnical conditions.
Under our present fiscal, financial and commercial set-up, this railway problem will always be on us because, over and above the technical and economic problems inherent in
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railways in other countries, we have the problem increased here by the unnatural and artificial pumping of goods across the country at great losses to everyonp. But being as it is and what it is, the railway problem and our economic problems cannot in any way be cured or even helped by the two amendments now before the house. They suggest no remedies. Their result would be only to postpone a needed solution of the problem. I like far more the courage and the logic of the government's decision of not interfering with the railway board's decision.
At this point I should like to congratulate the Minister of Transport (Mr. Chewier) upon the splendid presentation he made on Tuesday last. I do not think he has convinced us that the flat 21 per cent increase constitutes a solution with which all parts of the country should be satisfied, but he has shown the urgency of remedies to be applied, and the great need that the railways be helped at the present moment.
I may say at this point that I have admired the public spirit shown by the members on this side of the house coming from British Columbia, the prairies and the maritimes in supporting the government's attitude and at the same time presenting so well the case for their own parts of the country.


Alexander Malcolm Nicholson: Since Tuesday.


Louis-Philippe Picard: At all times.


Alexander Malcolm Nicholson: No, not last week.


Louis-Philippe Picard: So far as I am concerned, I think the decision is logical because the matter was entrusted to the board, and the latter investigated the problem at length, coming to its decision after careful study and realization of the seriousness of the situation as well as the impact the increase will have on the Canadian economy. Either the commissioners are not competent or to be trusted, in which case they should be replaced, or they are sincere and sufficiently able, in which case their decision should be accepted. I believe a government should interfere as little as possible with the decisions of specialized, semijudicial institutions; and although it is the duty of the government to review such questions and invoke if necessary the higher motive of the defence of the public interest should any decision be manifestly unfair, I do not think it is right for a government to interfere with the findings and decisions of independent boards functioning under laws created by parliament.
I also think the decision of the government not to interfere with the ordinance or delay its application is courageous, because it is

bound to be attacked and exploited by the opposition parties, who had nothing better to recommend, at a time when its results will be felt by the public. In that connection may I say that not only will the 21 per cent increase be resented by the people, but the small shippers and small manufacturers will be hurt much more than the larger ones. That will come about, not only as a result of the 21 per cent increase, but mainly because of paragraph 5 of the ordinance of March 30, which reads:
The minimum charge for a single l.c.l. shipment between any two stations to be 100 lbs. at first-class rate but not less than 75 cents.
In plain language this means it will now cost just as much to ship orders weighing twenty-five, fifty or seventy-five pounds as it will to ship orders weighing 100 pounds. That may mean it will cost up to 150 per cent more to ship certain goods from one point in Canada to another. For instance, prior to the ordinance it cost fifty cents to ship fifty pounds of tobacco, let us say, from Quebec to Toronto, because I am told that not only are good sentiments exchanged between Toronto and Quebec but also plain goods, including tobacco. Under paragraph 5 of the judgment it will cost $1.21 to ship the same parcel to Toronto. It formerly cost fifty cents to ship .a fifty-pound parcel from Quebec to Montreal, a distance of only 180 miles. Under the new arrangement it will cost eighty-two cents, or an increase of 65 per cent.
That is the part of the ordinance I dislike most, because it is most discriminatory as against the small dealers who necessarily order in smaller quantities. Either the manufacturer will pay the shipping charge and will now refuse to accept orders of less than 100 pounds, or if the dealer pays the freight he is bound to lose much of his profit on goods the prices of which are fixed nationally. This is one of the aspects of the ordinance I consider to be more discriminatory, but there is nothing we can do with the judgment as it is now, or until the new investigation is undertaken.
The .railways are facing a situation that needs to be corrected. The transport board, after long and careful consideration, has rendered a decision. I repeat that in my opinion the stand taken by the government is courageous, and eventually the people will realize that during this discussion no opposition party has proposed any remedy to deal with the railway situation. Delaying application of the ordinance would be no remedy at all. No other party has told us how they would get the railways out of their present predicament in any way other than that decided by the

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transport board. The stand of the opposition parties has been solely an endeavour to embarrass the government and hope for the best. I believe the membership on this side of the house, no matter how much it hates to see these new rates -imposed, no matter how much it hopes discriminatory measures in our railway rate structure, especially those affecting the western provinces and the maritimes, will be removed, will understand that- it is its duty to support a government that shows the courage to uphold an ordinance intended to remedy a dangerous situation. I also hope that the proposed investigation of the rates structure by the transport board may result in an arrangement of rates as satisfactory as possible to all parts and all elements of the country, despite the fact, as I stated at the outset, that our forced east-west economy shall always remain a sore spot in the economic life of this part of North America. I also believe less petty and parochial views are needed before all our economic and financial problems are adjusted.


Mr. ALISTAIR STEWART (Winnipeg North):: Mr. Speaker, the other evening the hon. member for Kindersley (Mr. Jaenicke) made a case showing that in some respects the board of transport commissioners were wrong in law in the judgment they handed down. I am not going to elaborate upon his arguments; those interested may find them in Hansard at page 2939 and following. The argument I am going to present this evening is that the board was not only wrong in law but wrong in fact, and that in supporting the judgment of the board the government is equally in error with respect to the facts. I maintain that the Canadian Pacific Railway Company did not make any case at all before the board for an increase in freight rates. I mention the Canadian Pacific Railway Company, because in his judgment the chief commissioner states that the Canadian Pacific has been taken as a guide or measure for the establishment of the rates. That statement will be found at page 36 of the judgment, in these words:
Upon consideration of all that has been placed before us I am of the view that this can best be accomplished by taking the requirements of the Canadian Pacific Railway Company as the guide or measure in the establishment of what we consider to be just and reasonable freight rates to be paid by the users of the railways.
Therefore tonight I am going to refer specifically and frequently to the Canadian Pacific Railway Company, its profit and loss account and its balance sheet, to establish my contention that the company did not make a case at all for any increase in freight rates. On
page 6 of this judgment we find part of the submission of the railway association of Canada:
Canadian railway companies are in the unique and perilous position that they have been operating under rigidly controlled freight rates in the face of steadily mounting costs . . .
That is quite a rhetorical statement, because I do not know what a "unique and perilous position" can be as far as the railways are concerned at this moment. But unfortunately it is only half the truth, and therefore all the more dangerous. I grant that costs have increased, in some respects considerably; but if costs have increased, revenues have increased even more. For instance, at page 11 of the judgment we find a table showing the total operating revenues of all Canadian railways. According to this table, in 1939 total operating revenues were some 8367,179,095, while in 1946 they were $718,501,764, or an increase of almost 100 per cent.
The other evening in this chamber the minister fell into the same trap and only told half the story. He told us about the Canadian National Railways, and that there was an over-all increase, with respect to wages and materials, of 40 T per cent between 1939 and 1946. He did not at the same time tell us about the total operating revenue of the Canadian National Railways, which increased in the same period by some $179,000,000 or the difference between $173,000,000 and almost $352,000,000. When those figures are placed side by side they shed a different light on the situation.
On page 7 of the judgment, paragraph 3, we find the following statement by the railway association:
The decline in railway gross earnings which commenced to be substantial in the latter part of 1945 has progressively continued into 1946 and such decline has not nearly been matched by a corresponding decline in working expenses.
A table is given here by the commissioner, showing that to some extent there was that decline but that the decline was more than made up in 1947. It may be that the railways had reason to fear a decline in 1946, but I think the board might have taken into consideration the substantial increase in operating revenues in the following year. One of the arguments presented by the commissioner, I presume to support his judgment, is to be found on page 11. This is another table showing the total operating revenue, and I quote from the judgment:
From the above it is noted that the monthly percentage increase in railway operating revenues in 1947 over the same period of 1946 is showing a tendency to disappear altogether.
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I assume that he came to that conclusion on the basis of a comparison between November 1947 and November 1946, which showed a percentage increase in 1947 of total operating revenues of only -98 per cent over 1946. Nevertheless, had the commissioner gone back to February of that year, he would have found that there was actually a decrease, not an increase, in 1947 over 1946 amounting to -92 oer cent. But in the ensuing months that decrease diminished and became a substantial increase amounting to 20-05 per cent in May of 1947 as compared with 1946.
Another statement which has been made is that the railroads were suffering from the effect of increased wages which had been demanded by the employees. I do not consider that to be a good argument, and I intend to use some statistics which were taken from the annual report of the Canadian Pacific and also from exhibits 22 and 116 which were presented to the commission. We find that in 1933 the gross operating revenue of the Canadian Pacific was some 8114,000,000, while the wages charged as operating expenses amounted to some 858,000,000, or 51 per cent. This percentage of wages in following years was as follows:
Per cent
1937	 49
1939	 47
1946		 47
1947		 49
I have taken the Canadian Pacific estimate of its gross operating revenue for 1947. This was given as $285 million, whereas the actual figure was some $318 million. Therefore I maintain that the percentage of wages to gross operating revenue would be somewhat lower than 49 per cent. The argument that wages are responsible for the increase in freight rates is one which is obviously not tenable.
On page 9 of the judgment the commissioner asks this question:
Have the applicant railways made out a case of financial need for greater revenue requiring a general advance in freight rates?
He comes to the conclusion by somewhat devious logic that they have. I am going to suggest that the commissioner has altogether omitted facts and has devoted himself to fancies. On page 11 we find this interesting statement:
A close analysis of the current operating revenues of Canadian railways indicates that lower levels may, perhaps, reasonably be expected.

He then goes on to give reasons why he thinks the current operating revenues may be lower, but I am not going to deal with them. Surely this is not a matter of fact. It is a matter of opinion, and I am going to suggest that the commissioner has come to his conclusions on the basis of his own opinions and not on the basis of facts. He is indulging in prophecy when he says that the current operating revenues "may perhaps, reasonably" be expected to be lower. Had the government wanted an opinion like that it would have been much cheaper if it had gone to a teacup reader. It would have got precisely the same answer. Surely that is no basis upon which to establish the case which has been presented to us.


John Lambert Gibson: He may have consulted the railroad brotherhoods.


Alistair McLeod Stewart: Its profit and loss account balance in 1939 was $141 million. Today it is $279 million. What sort of nonsense is this to talk of the Canadian Pacific Railway Company being in a perilous position! Nothing could,
of course, be farther from the truth. The company is better off today than it has ever been.
Let us see the situation as regards the working capital of this company:
Current Assets
Canadian Pacific Railway Statement of Comparative Working Capital
1939	1947	IncreaseCash 	
Dominion of Canada securities.... Miscellaneous accounts receivable.. Agents' and conductors' balances... Materials and supplies 	$31,809,398 5,120,664 6,695,339 19,389,497	$ 42,644,686 31,667,000 17,968.071 14,741,396 36,712,903	$10,835,288' 31,667,000 12,847,407 8,046,057 17,323,406Current Liabilities	$63,014,898 1939	$143,734,056 1947	Decrease	$80,719,158 IncreasePayrolls 	
Audited vouchers 	
Net traffic balances 	
Miscellaneous accounts payable.... Accrued fixed charges	
Unrnatured dividends declared .... Other current liabilities	$ 2,889,276 5,496,276 226,986 2,949,928 2,710,139	$ 7,053,336 9,284,072 4,491,862 9,452,084 938,186 2,278.841 13,339,604	$ 1,771,953	$ 4,164.060 3,787,796 4,264,876 6,502,156 2,278,841 13,339,604$14,272,605	$46,837,985	$ 1,771,953	$34,337,333Working Capital 	$48,742,293	$96,896,071	Summary	Increase in current assets	
Less: Increase in current liabilities
Increase in working capital ....

In other words, there is an increase in current assets of $96,896,071, less an increase in current liabilities of $48,742,293, or an increase in the working capital between 1939 and 1947 of $48,153,778. Again a remarkable position for a company which is in such perilous straits.
We are told that the railway wants nn increase in case it may perhaps at some unknown future date lose money. I see no reason at all for a railway company being granted the right to increase rates on the basis of a hypothesis, on the basis of an assumption, but that is precisely what has happened. The railway company is not being given an increase because it has shown need, for the railway's position today is better than it has ever been.
I should like to refer to the profit and loss position of this company, and to spare the house the reading of innumerable figures, I would ask permission, Mr. Speaker, to have printed in Hansard the table on page 66 of the judgment, entitled "Canadian Pacific-Restatement."


The ACTING SPEAKER (Mr. Golding):: Has the hon. member consent of the house to do so?


Some hon. MEMBERS:: Agreed.


Alistair McLeod Stewart: The statement is as follows:
Canadian Pacific-Restatement
Net railway operating income-without adjustments	 $22,892,189
Additions:
Deferred maintenance charged in 1947	 $2,400,000
Overstatement of Depreciation-Rolling Stock	 2,000,000
Overstatement of Depreciation-Road Property	 2,000,000	6,400,000
Net Railway Operating Income-after Operating Expenses Adjustments	 $29,292,189
Deduct Fixed Charges	 15,787,174
Net Railway Operating Income-after Fixed Charges	 $13,505,015

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Canadian Pacific-Restatement-Concluded
Adjustment for Taxes-
The 1947 accounts contain the following Taxes:
Property Taxes	 $ 3,800,000
Income Taxes on Railway Earnings and Other Income	 12,372,935
Total	 $16,172,935
Add Income Tax for 1947 as above	 $12,372,935

Taxable Income from Railway Operations
Income Tax at 35 per cent	 9,057,283
Net Income available for Dividends and Surplus	 $16,820,667
Add Back Fixed Charges	 15,787,174
Net Railway Operating Income

As Adjusted	 $32,607,841
Requirements	(1) 52,332,174
Deficiency in Revenue	 $19,724,333
Note-(1) Made up as follows:-
Dividends, $21,310,000,Fixed Charges, $15,787,174, Allowance for Surplus, $15,235,000, making a total of $52,332,174.
That statement shows the Canadian Pacific's net operating income, after adjustments made by the board of transport commissioners. We are told1 that the net railway operating income, as shown by the Canadian Pacific Railway Company, is $22,892,189. Then the commissioners proceed to add back, and rightly so, certain charges amounting to $6,400,000, arriving at a subtotal of $29,292,189. They deduct for the time being fixed charges, which are added back later. There is also deducted the entire income tax which the Canadian Pacific Railway Company has charged against operation, and the figure arrived at is $25,877,950, on which the board proceeds to compute the income tax. That is an extraordinary situation indeed, where we have income tax accepted as a charge against the operations of any *concern. I should like to know what the Minister of National Revenue (Mr. McCann) thinks of such behaviour. Certainly I know that no business in this country would be entitled to charge income tax against profit and loss account as a charge against the business of the year; but on page 22 of the judgment the commissioner states:
Income tax payable in respect to railway operating income is, I think, properly chargeable to railway operating expenses.
It is a good thing the commissioner said "I think", because obviously from the point of view of business practice it is entirely and completely wrong. Income tax is an appropriation of profits, neither more nor less, and has nothing at all to do with the running expenses of the business. However, it has been added back here, and I shall amend it myself later.
The fixed charges are also added back, leaving a net railway operating income as adjusted, in the mind of the commissioner, at $32,607,841. I maintain that that figure is utterly and completely fallacious.
If that is the basis for the board's action and the government's action, then it is time to reconsider the position. I am going to suggest that there be added back to that figure the $9,057,283 charged for income tax, which would then bring the net railway operating income up to $41,665,124. I am also going to suggest that the "other income" of this railway company be added back in its financial statement, that is "other income" of $24,788,927. When that is rightly and correctly added back we find that the profit position of the Canadian Pacific Railway should be not this $32,000,000 for 1947 envisaged by the board of transport commissioners but $66,454,051.
Let us consider that amount in view of what the board considers to be the requirements of the Canadian Pacific Railway Company. The requirements, as estimated by the board, are $52,332,174. On the basis of my argument, which I maintain is right in law and in logic, the railway company has a surplus then of over $14,000,000. But let us consider how this $52,000,000 is made up. Dividends amount to $21,310,000; fixed charges, $15,787,174; allowances for surplus, whatever this may be, $15,235,000, or a total of $52,332,174.
Let us now see what the chairman of the board of transport commissioners has to say, on page 26 of the judgment, about this surplus:
The question should, I think, be approached from the point of view of whether or not the
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railways are entitled to earn a reasonable surplus over and above fixed charges and dividends and not as to whether provision should be made for a sum to cover specifically additions and betterments. The amount which a railway may consider expedient to expend on additions and betterments may vary substantially in different years.
Of course it may. But what is the effect of this $15,000,000 when added to the requirements of the company? It is simply that an amount equivalent to practically 70 per cent of the dividends is to be credited to profit and loss account, and this may be paid out in some future year as dividends whenever the financial position permits. In other words, what the chairman of the board suggests is that the dividends of the ordinary Canadian Pacific stock should not be five per cent but eight or nine or even ten per cent.
I agree that it is reasonable that some surplus should be appropriated for balance sheet purposes, but I think $15,000,000 is out of the question entirely. A more reasonable amount would, of course, be S5,000,000, in which case the argument of the board of transport commissioners again suffers somewhat, because the requirements of the railway are not $52,000,000 but $42,000,000, and it then has a surplus over these requirements of some $24,000,000.
It has been argued that this $15,000,000 should be used for betterments of the railway and capital improvements. That, I maintain again, is a fallacious argument. This amount is being credited to profit and loss account, no matter how the funds are used. Nevertheless the amount will always be available for distribution as dividends. Whenever the directors of the company think the company needs money for capital improvements, let them go out on the open market and borrow the money for that purpose. As a matter of fact, from the figures I have already submitted on the reserves-and I repeat them again, reserves and unadjusted credits were $91,000,000 in 1939, and are $3S0 million today -the Canadian Pacific Railway Company has lots of surplus fat on which it can live for some time to come.
On this question of "other income" which seems to have perplexed the board of transport commissioners, they saw no reason for adding "other income" to the entire income of the corporation. Surely the board must have forgotten that much of the income which goes under the name of "other income" was derived from gifts and presents of the people of Canada to the same railway system. For instance, in British Columbia-the hon. member for Comox-Albemi (Mr. Gibson) may be interested in this; I expect he knows it-when the Canadian Pacific railway was built in that

province, over $100 million was paid to it in cold cash plus about twenty miles of land on either side of the railway all through the province. That gift is today returning handsome dividends; yet the commissioners refused to credit the revenue from this gift to railway operations.
Then again the company has invested money in various operations. The money that has been invested has certainly been taken from the operations of the company, from the surplus earnings of the company, and therefore any earnings from such investment should be credited to the operations of the company.
We have, for instance, the case of the Consolidated Mining and Smelting Company. I have no doubt that the Canadian Pacific Railway Company purchased shares in the Consolidated Mining and Smelting Company for the purpose of facilitating control of freight traffic. It has paid them handsomely from the point of view of their traffic receipts. This stock is in the books of the Canadian Pacific Railway Company at $8,412,500. Its market value today is about $150 million. Where is this perilous position which the Canadian Pacific Railway finds itself in with all these hidden reserves tucked away?
What about the hotels? Does the board of transport commissioners intend to argue that hotels are not part of the railway business, in view of the fact that the Canadian Pacific Railway Company itself has argued before two courts in this country that legislation affecting hotels is railway legislation? The company cannot have it both ways. Either it is railway business or it is not. If it is railway business then, of course, the proceeds should go into the general fund, as indeed they do. I maintain that when we look at the company's financial position we should consider its overall position rather than the financial position of only one part of the undertaking.
On page 23 of the judgment we find this:
The Canadian Pacific has a common treasury for all its various enterprises and into which goes its whole corporate revenue, including railway operating income and "other income." And from this common treasury all disbursements are made.
In effect, the company makes no distinction at all between operating income and "other income." Farther on the commissioner states:
The whole enterprise of the Canadian Pacific Railway Company is somewhat closely integrated.
Surely a classic understatement.
And for this reason I have found considerable difficulty in appreciating the true situation of the company in respect to its railway operations.

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The commissioner has difficulty; the commissioner never saw through it, and yet he comes to his entirely unwarranted conclusion. Obviously, if these activities are transportation activities, then the profits resulting from them should be included in the general profits of the whole business; if they are not, then they are improper investments for a public utility and the Canadian Pacific should get rid of them rapidly. I maintain' that, on the basis of the figures which I have presented to this house, neither the Canadian Pacific Railway Company, the board, nor yet the government has made a case for the increase in freight rates which has been granted.
Much has been made of the demands of labour for higher wages. I am in complete sympathy with these demands. I see no reason why labour should not get higher wages, but it is something approaching hypocrisy when the Canadian Pacific Railway Company professes to be so desirous of looking after the interests of its own employees in view of its record in the past with respect to these same employees. I am willing to say this. If, after the increases which the workers have asked for have been granted, the railways then show that they are taking a loss, I can see no reason at all why they should not be given an increase in freight rates. But I do not see why they should be given that increase when obviously they are not taking a loss and all they are doing is crying "wolf" and trying to frighten everybody.
Unhappily the only people they frighten are the board of railway commissioners and the present government, and the people of Canada have to suffer for it. So far as we in the west are concerned, even if there is an increase in freight rates, we are not going to lie down under the discrimination which exists in rates as between the west and the central provinces.
Again I join with those who do not blame the central provinces, but discrimination is a fact that has to be dealt with. We in the prairies have to pay 15 per cent more in many cases, in British Columbia and Alberta sometimes about 25 per cent more. Taking the picture by and large over the last twenty-nine years, we find that the Canadian Pacific Railway Company in its western lines has made net earnings of $753 million in the west, and in the east, $361 million, and now it wants to come and soak us once again.
I maintain that the action of the government in what it has done, in passing that order in council, has been hasty and arbitrary and that the Canadian Pacific Railway Company has more than enough tucked away in
profits and reserves to last for two years, no matter what increases are given in wages, until we have the new examination completed. There was no reason for increasing the rates. What we see again is the west, and, I suspect, the east, being exploited, with the active assistance of this government.
We also have the interesting, not to say anomalous position of some Liberal members who were breathing fire and smoke and bellowing loudly against the judgment on the 5th of April, when there was no want of confidence motion before the house. Then they were ready to do anything, but when the chips were down, in true Liberal style we could not see them for smoke.
It reminds me of what Heywood Broun said about a Liberal. As he was walking in Central park with his son, a small boy, they came to a merry-go-round. The youngster began squalling when Broun put him on the contraption and it began to spin around. He squalled more loudly and fiercely until his father took him off and they started away. Then the boy squalled the loudest. He wanted to go back; but he did not want to climb on again, but to stand as close as he could to the whirling thing without touching it and, above all, without having it touch him. "At that moment", said Broun, "I knew what a Liberal was".


Mr. T. J. BENTLEY (Swift Current):: There have been so many speeches in this debate that a few more will be in order. The speeches have taken a variety of turns, running from the one the Minister of Transport (Mr. Chevrier) made when he attempted to defend the government's position and tried to make the defence look like a major attack.
There have also been some pretty good analyses of railway statements, and there have been some careful criticisms such as that which has just been given by my hon. friend the member for Winnipeg North (Mr. Stewart).
I am going to try to deal with the matter from the ordinary citizen's point of view as it affects those of us who live by virtue of the work done in our day-to-day occupations, in the west, and to whom the matter of increased costs is extremely important. I know that those who live in the higher realms of finance and business can nearly always take a pencil and balance sheet and justify any action they wish to take in order to improve the position of the particular institution in which they are interested.
It is not by any means an odd situation that they should want to do so, but I sometimes think they do these things without realizing
Freight Rates

the effect on other people, and a great many people will suffer more than they need to because of this action.
I am not going to blame the railway companies very much. After all, they are human beings like everyone else; their interests are in the business they manage, and they attempt to manage that business in line with their particular economic gospel, to get all the profit the traffic will bear. They are not alone in the worship of that particular golden calf.
A number of statements have been made here-I believe someone called it "slick", or used some similar adjective-describing the move which the C.C.F. made when our leader moved the amendment on going into supply the other day. Prior to that, and before the time when these rates were to go into effect, an attempt was made, by moving for the adjournment of the house to discuss the matter, to persuade the government that they should stay proceedings. It was not asking the government to disallow the increase. It was not asking the government to take any other position or to do any other thing than simply to delay or to put a stop to proceedings until such time as everyone concerned had had an opportunity to present to the government the effect which the increase would have on the people to whom they were responsible. These were the premiers of the seven provinces which are affected, who knew the temper of their people and the conditions' in their provinces.
As has been pointed out here before, these premiers, these provincial governments are of different political stripes. So when they said they were dissatisfied with the judgment of the board of transport commissioners, they did so in the full belief that they were dealing with the matter, not from the political or partisan point of view, but from the point of view of the effect it would have on their particular provinces.
It has been said in this debate that the C.C.F. and others who were opposed to the increase were not giving consideration to the needs of those people who worked for wages on the railways. I have read through the judgment. I will not say I have made an exhaustive study of it, as possibly others have done, but at least I have read it sufficiently to know what is not in it, and I find no place in the judgment which indicates that the increase has been granted by the board, in any part whatsoever, specifically to be applied to an increase in wages or salaries of the workers on the railways.
I am also informed by other sources outside the judgment that the unions who represent

the workers on the railways were not permitted to add their voice one way or the other when evidence was being given before the board. I wish further to point out that there has been no alternative proposed by either the government or the board, or by the management of the railway companies themselves. It may be possible that there are alternatives, but if their need for increased revenue was great, alternatives could have been proposed, and they have not been mentioned.
I wish to point out another thing before I go very far into this subject, and that is that in the early stages of the discussion the hon. member for Lethbridge (Mr. Blackmore), who was quite vehement in his observations, pointed out that a thing of this kind, added to the many other discriminatory practices against the west and the east-he was dealing mostly with the west and I will, too-may possibly cause in the west a serious rupture of good feelings toward the two central provinces. The leader of our party said more mildly that it was a threat to good relations, because the country, economically, was bound together by bands of steel. That has been mentioned on more than one occasion both in histories of this country and in historical novels written by people who write things of that kind.
The hon. member for Calgary West (Mr. Smith) was inclined to feel that the hon. member for Lethbridge did not add anything to national unity by making the suggestion. But I think the hon. member for Lethbridge did a good job in doing that, for this reason. While I am the last one who wants to see any disunity, I do not think we should shut our eyes to anything that may happen to cause breaches such as he suggested. I know the people in the west are not thinking of secession-that is, not a large number of them-although it is true that there are a few here and there who will get up and say that we should have secession. But I know there are quite a number of people in the west who, whenever something like this happens that affects them, will then start to consider seriously the suggestion of these few other people I just mentioned who call for secession. I know, however, that the great bulk of the people in the west want to have a united nation in Canada as well as a united nations organization in the world. I am also one of those, and I certainly will never do anything I can avoid doing that will cause any serious talk of a split in our Canadian nation. I think it would be most unfortunate.

Freight Rates
The hon. member for Waterloo South (Mr. Homuth) is, I believe, quite ill. I regret that, and I should like to say to him, through his friends, that I hope his recovery will be rapid and complete. I regret greatly that he is absent because of his illness. But he mentioned the fact that he did not think any differences which might exist between the central provinces and either of the extreme ends of our country were bred entirely of selfishness, and that he believed that it was not fair for him to be able to buy a Chevrolet car-I think that was the example he mentioned-more cheaply than somebody in Regina, Edmonton or Vancouver could buy it, just because there was a heavy freight charge on it out there. I give the hon. member credit for that, and I believe he meant what he said.
I hope his friends will convey that to him because, when he was making that statement, he said that members of this party never had a kind or pleasant word for anybody. I assure him and many of his group that many times we believe in their sincerity. I believe he would do as he says. But unfortunately the history of the country has made it possible for concentration of control of our economic life to be in these central provinces; and sometimes the management of these large concerns which have that control have not exercised the restraint they might have exercised in their dealings with other parts of the country, thus causing to a large extent those feelings which I have just described, which were mentioned by the hon. member for Lethbridge.
We do not want any secession. We want a complete and unified nation. I do not intend to go beyond that as did one member on the other side of the house tonight, I believe, when he suggested that we should have customs union and possibly political union with the United States. I am still quite happy to be a Canadian, and I believe that Canadians can run their own business in their own way without any joining up with somebody else to run their domestic affairs.
With regard to some of the things dealt with by the judgment, there has been misinterpretation either by the press or by political speakers, and possibly a combination of both, which has given rise to a belief that is not correct. We were led to believe that there was to be no alteration in the freight rates on grain. When we read the judgment we see that that is not a correct statement. But the word went across the country making many people believe that it was so. Now we
find ourselves flooded with protests because the new freight rates are being applied on out-of-line hauls, I believe on storage in transit and on local movements of grain in the provinces. That will have an effect on the cost of living and the operations of farmers in both buying and selling their grain in the different localities. I believe these rates should have been left as they were. Of course I do not think any of the increases should have been granted at all in the judgment. But if they were to be granted, I believe that these rates should have been left as the word went out they were to be left.
Another thing I wish to point out is that, as stated in one place in the judgment, the minimum charge of seventy-five cents per 100 pounds on less than carlots will mean, in some cases, not a 21 per cent increase, but more than 100 per cent increase. We will take the matter of a crate of eggs, for instance; and many small poultry people, in order to have their eggs go forward to market as fresh as possible, must ship them frequently in one-case lots. I want hon. members to realize that a great many people operate on a small scale. That is how they make a living, and that living is important to them. I presume that if you ship a case of eggs now under what the judgment has allowed the railways, where it used to cost thirty-five cents to ship a case, it will now cost seventy-five cents. That is more than double the price charged before, and I think it is completely unwarranted and unfair treatment of the kind of producers I have just mentioned.
There is another thing. I am sure that in the judgment I can find no authority for this being done but I am informed that it is being done, and that is-


Lionel Chevrier: Pardon me. If the hon. gentleman will look at page 88 of the judgment under the title of "Minimum Charges" he will find that there is authority for doing that very thing.


Thomas John Bentley: Pardon me. I imagine I did not make that point clear. I had finished with that remark. While authority is there for seventy-five cents per 100 pounds on l.c.l, I just got through saying it should not have been allowed by the board.
But what I want to mention now is the matter of retroactive charges on these freight rates. That is not allowed in here that I can find; yet I am informed that in the western provinces, cars that were shipped out before April 8 and were in the showrooms, and farm machinery that was in the warehouse, now have added to their cost the 21 per cent
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Freight Rates

increase in freight. Who is to get that? Not the railroad. The machine companies and the automobile manufacturers or the dealers will not collect that retroactive freight and turn it over to the railroads.


Lionel Chevrier: May I be allowed to tell the hon. gentleman that the board's order carries no retroactivity. It is effective as of April 8.


Thomas John Bentley: I agree with the minister. I heartily censure him for not having taken steps to see that no dealer in these machines made that charge on goods shipped before April 8. The government took no such action to protect the people. It did the same thing in this connection that the Tory government did many years ago when it put the excise tax [DOT] on sugar and allowed people with warehouses full of sugar to reap that extra profit and put it in their own pockets. The government has not given the attention to the needs of the people that it should have given.
A short time ago I said no thought had been given to the alternatives. There are at least three principal reasons why the railways felt it was necessary to ask for this increase in freight rates. The first is the tremendous overcapitalization, particularly of the Canadian National; and I want to quote authorities for that statement. First I refer to the report of the royal commission, commonly known as the Duff commission, at page 30:
Another aspect of the problem is the total capital liability of the system. At December 31, 1931, the long term debt of the Canadian National Railways due the public (funded debt unmatured) amounted to $1,276,457,207. The money invested in the original government railways, loans by the dominion government to the privately-owned railways now absorbed in the system, loans to the Canadian National Railways to meet annual deficits, interest accrued on these loans and unpaid, and deficits on eastern lines, together total $1,393,469,164.	The
total of these two sums is $2,669,926,37.1.
It has been suggested that in view of the excessive capital liabilities in relation to the earning power of the system they should be reduced to an amount w'hich would more nearly approximate the earning power of the railway. The net operating income (i.e. the amount available for interest and dividends) of the Canadian National system for the period 1923 to 1931 inclusive averaged $24,414,447 per annum. This figure would require adjustment if adequate provision were made for depreciation. It is obvious that on this basis of earnings the capital liabilities would require a very drastic writing down.
And while this commission is of opinion that it must be frankly recognized that a very substantial part of the money invested in the railways comprised within the Canadian National system must be regarded as lost and that its

capital liabilities should be heavily written down, they do not consider that the time is opportune to deal with this important matter.
That was back in 1931 or 1932. When is the time to be opportune to do that job? Again, at page 86 of the judgment of the board of transport commissioners just issued, they confirm that statement in the second paragraph under the heading "Other income":
The Canadian National Railways are efficiently managed but are operating under a very large debt which carries a large fixed charge, which makes it very difficult to operate from a profit point of view, it being an amalgamation of a number of non-paying roads.
More could be quoted along this line. At page 41 of the book "The Tragedy of Henry Thornton", the writer makes this statement:
It is true that "surgical operations of the bankruptcy courts" should have lessened the crippling burden of capital indebtedness ....
I am not so sure I would want to recommend a surgical operation of that kind, but I say that, since the Canadian National Railways is a government-owned concern, if that is necessary in order to put it on a paying basis, then the proper thing to do is to write it down to its actual value. Then let the capital, which has no representation in physical assets but which represents the savings of widows and orphans and other people who had a right to expect their investment was safe, be provided for and serviced by all the people of Canada, including Ontario and Quebec. That would be a fairer way and a better alternative than allowing this increase in freight rates, which will have a more detrimental effect upon the people of the west and, I understand, those of the east than they should be expected to bear.
On motion of Mr. Bentley the debate was adjourned.



BUSINESS OF THE HOUSE

Mr. BRACKEN:: What will be the business for tomorrow?
Mr. ST. LAURENT: Tomorrow afternoon we shall resume the debate on the motion to set up the committee on human rights and fundamental freedoms. If that is disposed of before six o'clock we shall proceed in committee of the whole on Bill No. 138, to amend the Export and Import Permits Act. If that should be disposed of before six o'clock the next item will be the second reading of Bill No. 197, to amend the Export Credits Insurance Act. After six o'clock the Minister of Justice and the Minister of Trade and Com-

Business of the House
merce will have other official duties that will prevent them from being in the house during the evening. At eight o'clock, of course, there will be the hour reserved for private bills. After that will come the second reading of Bill No. 47 to amend the War Service Grants Act; second reading of Bill No. 60, to amend the Veterans Insurance Act, and then the resolution standing in the name of the Minister of Veterans Affairs preceding a bill to amend the Veterans Rehabilitation Act. If that is not enough the Minister of Transport will be prepared to go on with the second reading of Bill No. 10, respecting the appointment of
auditors for the national railways, and with the resolution preceding the introduction of a bill to increase the grant to the railway grade crossing fund.


Mr. MacINNIS:: When will today's debate be resumed?
Mr. ST. LAURENT: This debate will probably not be resumed until Tuesday. On Monday the unfinished business of the program for today will be continued, and other items will be added if there is time for more work.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
5849-192J
[Stage Direction]
Friday, April 16, 1948