1949-11-01

ROYAL CANADIAN NAVY


Hon. Brooke Claxlon (Minister of National Defence):: Mr. Speaker, following disciplinary troubles on several of the ships of the Royal Canadian Navy, I appointed a commission to investigate and report on the causes of these incidents and other related matters. The commission consisted of Rear Admiral E. R. Mainguy, O.B.E., chairman; Mr. L. W. Brock-ington, C.M.G., K.C., and Mr. Louis C. Audette, members. I believe everyone will agree that the reputations and personalities of the members of the commission created respect and inspired confidence.
The commission has made its report, and its recommendations are being examined. As the report itself points out, several of its recommendations had already been carried out before the report was made, and many others are well on the way to being implemented. Although the report might be regarded as confidential, it has been decided that in this case the general interest would be served by making its contents public. As hon. members have expressed interest, it would probably meet the wish of the house if a copy of the report were tabled.
I should like to take this opportunity of expressing warmest appreciation to the members of the inquiry. Each of the three members brought to this task outstanding qualifications. The report is a highly constructive and useful document of general interest, and it will be of great value in the work of developing the navy on sound lines. Its findings should prove invaluable in furthering the great reputation and traditions of the Canadian navy, earned so magnificently in time of war by its major contribution to victory at sea.



CONSULTATION BETWEEN CANADIAN AND UNITED KINGDOM OFFICIALS

[Stage Direction]
On the orders of the day:
Mr. G. K. Fraser (Peterborough West):: should like to direct a question to the Minister of Trade and Commerce and the Minister
45781-84i
of Agriculture. As the deputy ministers of those two departments have recently returned from the United Kingdom following a conference, will either of the ministers state whether any new agreements or contracts are contemplated?


Right Hon. C. D. Howe (Minister of Trade and Commerce):: The deputy ministers of trade and commerce and of agriculture went to the United Kingdom to place the views of this government before the officials of the corresponding departments in the United Kingdom. The government is now waiting to hear the views of the ministers on the representations that were made.


Gordon Knapman Fraser: When will the minister make a statement to the house?



BUSINESS OF THE HOUSE


Mr. T. L. Church (Broadview):: The hour from eight to nine tonight is reserved for private bills, and I notice that, according to the order paper, item No. 49 will be considered tonight. This item reads as follows:
Resuming debate on the motion of Mr. Maybank for the second reading of Bill No. 66 (letter E of the Senate), intituled: "An act to incorporate Alberta Natural Gas Company."
Will this bill be referred to one of the standing committees of the house in order that they may make a detailed study of it? As I see it, the bill creates a huge franchise for the private promoters, and there is no control over rates. The Bell Telephone bill a few years ago was referred to a committee for detailed study, although it came from another place.


Clarence Decatur Howe: It is my understanding that the bill will be referred to the appropriate committee of the House of Commons, which I believe is the committee on railways, canals and telegraph lines.



RADIO BROADCASTING


[Stage Direction]
On the orders of the day:
Mr. J. G. Diefenbaker (Lake Centre):: should like to direct a question to the Minister of National Revenue. Some announcements have been made outside the

Inquiries of the Ministry house by private members supporting the government to the effect that the licence fee for receiving sets is to be done away with next year. Is that correct?


Hon. J. J. McCann (Minister of National Revenue):: I have no information, Mr. Speaker, except what I have seen in the papers. Persons who make statements of that kind do so entirely on their own responsibility.


Mr. Graydon:: In other words, they are talking through their hats.


John George Diefenbaker: Is it the intention of the government to set up the radio committee at the present session, so that we can find out?


Mr. Speaker:: Orders of the day.


Gordon Graydon: No; there is a question to be answered.


Right Hon. L. S. St. Laurent (Prime Minister):: Possibly I should answer that
question. When it becomes the intention of the government to set up a radio committee, an announcement will be made in the house.


John George Diefenbaker: May I say to the Prime Minister that private members should not announce radio policy outside of this parliament.


Louis Stephen St-Laurent: It may perhaps be the privilege of the hon. member for Lake Centre to lecture other private members; it is not mine.


Some hon. Members:: Hear, hear.


Gordon Graydon: If you applaud that, you will applaud anything.


Mr. Cruickshank:: Get a new leader.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Gordon Knapman Fraser: I should like to direct a question to the Minister of Public Works. Owing to the scarcity of parking space for civil servants and employees of the government, would it be possible to use the excavated dirt and other material that is being taken from the site of the new veterans affairs building and use it at the back of the confederation building to make parking space, instead of hauling all this material over to Hull?


George Alexander Cruickshank: That is the best one you have asked yet; that is sensible.


Mr. Smith (Calgary West):: Lots of dirt.


Hon. Alphonse Fournier (Minister of Public Works):: It may be possible to comply with the request made by the hon. member; but

having received no notice of his question,
I shall have to look into the matter further and give a proper answer later during the session.



UNITED NATIONS


[Stage Direction]
On the orders of the day:
Thomas Langton Church: Has the
attention of the government been called to the report in this morning's Ottawa Citizen of a speech made yesterday by the Minister of National Health and Welfare (Mr. Martin), who is second in command of the Canadian delegation to the United Nations at Lake Success? Speaking to students of the university of Montreal international relations club, who were visiting United Nations headquarters at Lake Success, the minister said that the United Nations "will gradually assume legislative character," and that "the International Court of Justice will assume responsibilities similar to those held by national supreme courts." Does this represent government policy, or not?


Louis Stephen St-Laurent: I am sorry, Mr. Speaker, but though I did my best, I could not hear the hon. member's question. I shall have to read it in Hansard, and then I will attempt to give him an answer.



THE BUDGET


[Stage Direction]
The house resumed, from Wednesday, October 25, consideration of the motion of Hon. Douglas Abbott (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Rowe, and the amendment to the amendment of Mr. Thatcher.
Arthur Leroy Smith: I intend, Mr. Speaker, to discuss the question of oil in Canada, its history, its growth, and finally its markets. I want to make it plain that I am speaking entirely on my own, because on the question of markets I know I shall be in disagreement with many members of the house, and perhaps even with members of my own party.
But before proceeding to do this, conscious as I am of the latitude which I have in the budget debate, I want to pay a well-deserved tribute to some men whom I do not know. In the newspapers last week I noticed a report that two old friends of mine had been elected to the hockey hall of fame. The

trustees, or whoever control that organization, must be fairly old, because they have elected as one of their executives Mr. Donald H. Bain, of Winnipeg, familiarly known as Don Bain. In the days when I was a boy he was the greatest hockey player that western Canada ever produced. He then formed the Winnipeg skating club, and today at seventy-five he is one of the best figure skaters in Canada. The other man who was elected is an old friend and opponent of mine, Mr. Art Ross, of the Boston club. I can assure you, sir, that he was the fastest stick man I ever came in contact with. He has done much for the present game. The net that is now used in hockey games was an invention of his.
Having spread this kind of oil, probably I had better turn to the oil in the province of Alberta with which it is my intention particularly to deal. It is only in recent years that oil production in Alberta has been quite active, but the history of it goes back fifty years, to two old-timers, Lafayette French and Kootenay Brown. Near Pincher creek they found some Indians around a slough. They were skimming from it an oily substance which they were using internally as a purgative and rubbing on their old and withered joints to loosen them up. These men drilled a shallow well from which nothing came; but it will be remembered that that well was on the site on which the Gulf Oil Company have now discovered what is easily the largest wet gas field ever discovered in Canada, and perhaps the largest ever discovered in the world.
In 1914 a company which had been organized locally drilled in the Turner valley. They went down to only 2,700 feet, because in the banks of the Sheep river was a seepage of gas. The promoter of that little company was the smartest man I knew then, because he took greenhorns there to look into the oil situation, shoved a stick into the ground on the edge of the river, lit the gas flare with a match, and fried a couple of eggs. That was his first step in the promotion of this company. It is a well known fact that in the early days of the round-up on this particular seepage the old cow hands did their cooking without the aid of wood or other fuel of the kind.
Later a company incorporated in Calgary found oil near this same Sheep river. They drilled to 2,700 feet and found oil and gas in what became known as the Dalhousie sand. A few years later a local company, now known as the Royalite company-it was local capital-with the assistance of Imperial Oil, which owned Royalite, drilled a well and found wet gas. So far as we in southern Alberta were concerned they found it just in time, because we were running out of
The Budget-Mr. A. L. Smith natural gas. For years, from this old No. 4 Royalite well, that whole southern area was supplied with gas. It was a wet gas-which simply means a gas holding a liquid in solution. After the liquid was removed it was known as a white product. In other words, it was as colourless as the purest water you can find. We are still getting some of the white product from that area.
In 1924, I think it was, Bob Brown and George Bell went down the flank, as they said; and that was the first discovery of crude oil in western Canada. That field reached its peak in 1942, when it produced
30.000	barrels a day. From that discovery the field has already yielded 100 million barrels of crude oil and 1,500 billion cubic feet of gas. I do not know what these tremendous figures mean. A ten-dollar bill is the limit of my thinking in a financial way. I have difficulty in understanding millions and billions.
That field is now pretty well gone. It is estimated to hold 25 million barrels of oil and 500 billion feet of gas. The house might be interested in knowing just what the operation is down there now. Up at the top the first well was drilled to roughly
6.000	feet. There gas was found. Brown went down the slope and found crude oil. Other people have gone further down the slope and have found salt water, which is not much good to anyone. The point is that in order to get your oil to the surface, gas is your major if not your only motive power. What they try to do is to hit that crude oil by going down from the top. Remember, the surface of the ground is all level; what I am speaking of is in the rock underneath. There they found what is called Madison limestone, and it contained crude oil and gas. Therefore you see mother nature working. There is salt water at the bottom, oil next, and above that the lighter material, shall I say, in specific gravity; this is at the top. It is put there at a pressure of perhaps 2,000 pounds to the square inch. Therefore with the gas pressing on the oil on top, and the water pushing from the bottom, up the pipe comes the oil, and that is how they get it up. It is later refined into gasoline. That is the standard way in which all oil comes to the surface. Of course when the motive power is gone you can put it on the pump and make a considerable recovery in that way.
Perhaps ninety per cent of the oil wells in California are now pumping in the old way. It is the same principle as the operation of your water pump at home, but on a larger scale; and it is operated by a walking beam which simply goes up and down. It is
1324	HOUSE OF
The Budget-Mr. A. L. Smith the same walking beam which drills the hole. In other words, in the old days all holes were drilled by what were called standard tools or standard equipment. This simply means that you have a great long piece of sharpened steel-and when I say sharpened I do not want hon. members to think of a knife; it is wrinkled as it were on the end, and it pounds, pounds on the rock. That is the way all oil wells were drilled prior to the discovery of the rotary machine, which simply means that you have what is called a rotary table put in, and your works above, and that spins the pipe in the centre, called the drill pipe. At the end of the drill pipe away down you have what is known as a bit, and it whirls away and grinds up the rock rather than simply pound, pound. It is infinitely faster. Now that they have caught up with their equipment I do not know of any standard rigs that are working in the oil fields in the province of Alberta to get the oil to the surface.
Then they put on what we call a Smith separator. I may say, Mr. Speaker, that it is not named after me. The principle is very simple. It is by the quick expansion of this gas that the liquid is thrown out. It goes down into the bottom of the separator, while gas comes out the top. The gas which is expelled, still containing some oil, is then taken to what is called an absorption plant. That plant takes the remaining liquid from the gas, and it too is a white product or distillate. That gas then goes to what is called a scrubbing plant, where the sulphur is scrubbed out of it. The gas in that area is not sweet; it is sulphurous. By this treatment the sulphur is removed from the gas, which is now dry. It then goes into the pipe line on to Calgary or other points. But it cannot all be used. They pipe it back into the ground with the remaining oil, by the use of compressors, and then it serves two purposes: it maintains the motive power in the ground to lift the oil, and it also is the cheapest storage you can get in order to use it again. Then it comes back to the city of Calgary to be burned in furnaces.
I may say, sir, that I built my first house in Calgary in 1912, and although we live on a coal bed, I have never since burned a pound of coal for cooking or heating or anything of that kind.
After that an intensive search was carried out, but it was all on the eastern slope of the rockies, either in the foothills or in the eastern mountains themselves. To give you an idea of costs, sir, there is one hole that was drilled sixty miles north of Jasper, in connection with which a company, or several companies joining in drilling the one hole, spent $1,250,000 cash and got nothing. I mention that to show the cost of drilling wells.
[Mr, Smith (Calgary Westl.l

Gulf Oil drilled down in the Pincher creek area at this great cost, and discovered two wells. Both are between 12,000 and
13,000	feet deep

over two and a half miles. Both cost over $1 million. Therefore I say- and this is fairly good proof of it-that people who hazard capital in this way are entitled to a good return in the mining business; they regard oil as a mining business, and so do I.
In the meantime a comparatively new instrument has come into use; I refer to the seismograph. It is the instrument that is used to record an earthquake in Turkey, for instance, or in the middle of the Pacific ocean, or the Argentine, or some other place. But in oil operations it is used in a different way.
Science has advanced this business very appreciably and very fast. You have a seismograph crew who go out with a small derrick on the back of a truck, and you drill down to bedrock. In most parts of Alberta that is not very far. Then down that hole you put a charge of dynamite. You explode the charge; and on your instrument, which perhaps will be a couple of hundred yards away-it is an electrical affair-you find that the noise of the charge striking the various strata of rock has been recorded. The result is that you know roughly where the Devonian limestone is. That is where our production comes from now. With this instrument the prospector can record to a matter of two or three inches, for a mile deep in the earth, the depth of the rock they are looking for. Then they will go out laterally, and in that way they can find whether the Devonian is deeper there or at some other point. It will be kept in mind that the surface is flat. They find whether the Devonian is deeper, or higher. If it is higher, they keep going that way, because they are looking for what they call a "high", because the oil and gas, the lighter products, will be at the highest place in whatever structure you have below.
So they keep going in various directions until they will say, "Here is a structure where the high is so-and-so. We have taken it so many miles. There is the low; that is probably where you will get your water." Then you drill. You get something, because that is a rock which has small interstices in it, and it will hold something-it may be salt water, or it may be oil. If it is oil you are in luck; if it is salt water, you are out of luck. But you do know you have been drilling toward a basin or container which may contain oil.
Today, therefore,, all the large United States companies are in there with seismograph crews, and many Canadian companies are doing the same thing. Some people think we are giving our birthright away to the United States. I noticed a few days ago in

a Calgary paper that the Calgary firm of Tanner Brothers paid something over $980,000 to the provincial government for one quarter-section of land. That is Canadian money; it has no reference to any big shots from the United States who go in there. This represents the highest price ever paid for so-called oil lands in that area.
Perhaps I should now say something I had intended to say later. The provincial government get that money in cash, as a bonus for signing the lease. They also get, for the lifetime of the use of the property, a dollar an acre in rental. They get 12J per cent gross out of everything produced from that land. So that the province of Alberta is not going to go broke so long as we have a continuation of discoveries anywhere within range of the base which has been set from time to time.
I should like to go back to the question of discovery. The Leduc field was discovered in 1947. It will be recalled that up to that time we had what might be described as showings of oil, some of which were perhaps slightly commercial, in various parts of the country. This indicated that the discovery of oil was moving north. Leduc is twenty miles from Edmonton, and now there are many people in the world who know where Edmonton is but who, before the discovery at Leduc, did not know that Edmonton was even a place on the map.
This is the centre of the discoveries now being made, and it has proved to be a very large commercial field. It was the discovery of Leduc by Imperial Oil which caused them to sell their ownership of the company which operated under the name of International Petroleum, in order to get development money for this Alberta situation. This they did to an extent somewhere in the neighbourhood of $90 million.
This development has gone on. The drilling at Leduc is comparatively shallow-roughly a mile. If hon. members will just think of a mile in distance they will understand fairly well where production is coming from at the present time. Then they found this bend in the Saskatchewan river just west of Edmonton. They went on north and east some forty or fifty miles and found Redwater. Since then they have made a number of discoveries. For instance, Golden Spike has the largest depth of saturated sand that has yet been found in Alberta, and I believe almost as large as any which has been found in any part of this continent.
Hon. members will see that the situation is now looking up. I should like to mention one field discovered since we came to Ottawa to attend this session. I refer to the Normand-ville field, which is about thirty miles south of Peace river, in the constituency of the
The Budget-Mr. A. L. Smith hon. member for Peace River (Mr. Low). This field is away by itself; there is nothing near it, and it is brand new. By the amount of porosity that is indicated-and porosity is simply another way of referring to the interstices in the rock in which of course the oil is found-the prospect would look good for this discovery. It has good porosity; and the tests already made would seem to indicate that it should go to at least a thousand barrels a day. The wells to which I have been referring are thousand-barrel wells.
The oil people have learned, as other people have learned, that there is only so much beer in a barrel. You can turn a beer barrel upside down and take the beer all out, but you cannot turn an oil field upside down and get all the oil out. In fact it is considered an excellent recovery in any oil field to get 60 per cent of the oil that is there. So these wells are operated on what is known as oil-gas ratio, or gas-oil ratio, whereby they will have the longest life, and whereby this motive power will not be drained away quickly, leaving too much oil underground. This oil, of course, will never be recovered once the motive power is gone.
Today Alberta is producing about 70,000 barrels of oil a day. Someone may ask: How much is that? Well, it is enough to supply western Canada. When I say that I am not including British Columbia, I refer only to the three prairie provinces. Strangely enough the prairie provinces consume more than what one would normally expect to be their share, judging by population. But they absorb more per man than any other part of Canada, owing to the fact that in those provinces farming has become so completely mechanized. It is not the motor cars and trucks which use these large quantities; it is the farm machinery which uses the greater part of it.
The oil is taken from the ground, and is of no use to anyone in its natural state. It is of different gravities; I think the correct term is "Baume". The higher the degree your measuring apparatus indicates is, the more light oil there is in it and therefore more gasoline and less of the heavy ends or heavy products which are not nearly as valuable and which today are a drug on some markets close to the refineries in western Canada.
What is refining? It is a matter of heat. I know they have done excellent things and made many improvements, but refining simply means to take the crude oil and heat it to a certain degree when it begins to give off a gas. That gas is separated and you obtain lighter or more volatile products. One of the top products now obtained is propane.
1326	HOUSE OF
The Budget-Mr. A. L. Smith
I am sure the farmers of Alberta were glad when they began to bottle this propane gas under pressure a couple of years ago. It is now used in hundreds and hundreds of farmsteads in Alberta. I speak with positive knowledge of that province, but I understand that a good deal is used in Saskatchewan as well. Instead of the farm wife having to get out the poker to stir up the coals and bring in some more wood to burn, she simply turns a tap the same as a housewife in Ottawa would if she is burning gas. It is not particularly expensive, and, with normal use, one bottle will last a small household for a couple of months.
You increase your temperature and you obtain other things, including gasoline, the most valuable product that we have. As you go higher and higher you get your distillates and diesel and fuel oils. Last of all you get down to the road oil, and if your crude has an asphaltic base you get quite a lot of almost pure asphalt. This is not much good to you, because there is no market available near the refineries.
In other words this process is similar to that carried out with the old copper still. A man would get his mash ready and go into the bush. He would light his fire, cook his mash, and run the vapour through the little curlicue and produce a product which perhaps many of you have drunk as bootleg whiskey. That is exactly the same process as is carried out in an oil refinery.
How are we fixed for refineries? Two have been operating in Calgary for some years, and they have proved to be a good investment. British American Oil have one in Moose Jaw, and Imperial Oil have one in Regina. There is a small co-operative plant at that place, which incidentally has gone into the production of oil, as they have several producing wells in Alberta. In Brandon there is a fairsized one; in Winnipeg there is a small one, although this is known as a skimming plant which in the true sense of the word is not a refinery. Then there is one in Edmonton, and McColl-Frontenac are building a second refinery there.
Hon. members might be interested in the history of the Imperial refinery in Edmonton. It was first erected at Corpus Christi on the gulf of Mexico. It was then moved to Whitehorse. Hon. members will remember that during the war the United States put a pipe line across the mountains from Norman Wells to Whitehorse, and this refinery was moved up there to refine the crude oil to meet the needs of the army. After the war that pipe line was junked and Imperial Oil bought the refinery and moved it by truck 1,600 miles down the Alaska highway to Edmonton. They re-erected it there, and they di dnot have one


piece of steel over. So this refinery has been moved from Corpus Christi to Whitehorse and finally to Edmonton, where many fine things from Calgary finally come to rest. They are now apparently robbing the north of what little they have.
What are we going to do with our oil? This is where I may be in disagreement with certain people. I have consulted the producers of oil in Alberta on this matter. I hope I shall not be out of order if I say a word or two about the pipe line froim Edmonton to Gretna, Manitoba. I make the simple statement that I am all in favour of it. We in Alberta are looking for markets for our oil, and I am doing my best to represent here the interests of the people of Alberta.
I know that sound economics means that you must get your goods to the nearest available market. We are told that this oil could be sent to the Canadian head of the lakes for another $10 million, with a half million per year additional upkeep cost. I think those figures are right. I know all the arguments about having this Canadian product disposed of in Canada, and I am not going to repeat them. But if in the development of this field we can send our crude oil to nearby points in the United States while you people in the east are getting your oil to Sarnia from nearby fields; in other words if Alberta can achieve a balance in crude oil, then the Alberta oil industry will have made a greater contribution to the welfare of the Dominion of Canada than almost any other industry I can think of.
I am far from saying that this product should not be used in this country. I note that special Canadian tankers are being built to move the oil from Superior to Sarnia or other areas. If refineries are built where there are no markets for your finished product, you are bound to have the heavy ends as a drug on the market. There will be no use for them. The Lloydminster field on the border between Saskatchewan and Alberta produces a heavy grade of crude, but that field has suffered a terrible set-back. Why? They have no market for many of their products. The Husky Company have the refinery there, and while they obtain some lighter ends and some gasoline from their heavy crude, they are under a considerable handicap because there is no market for the heavier products.
Remember that oil will not flow all the time; it must be helped. You can readily see that if it is of the consistency of molasses, there will be certain mechanical difficulties in your way. I take a back seat to no one in believing that we should produce all the oil we can in this country, but I do not carry my patriotism or my sentimentality to the point where I contend that we should cripple

the sale of a product in competition with other products because with this all-Canadian scheme you are going to have an increase of two or three cents in the price. Who is going to pay it? There are only two sources from which the money can come, namely, the producers of the oil in Alberta, or the consumers wherever the gas may be sold. Referring to other forms of transportation, some may ask: Why not have the refinery in Alberta and ship by rail? But the cost of transportation by rail is at least 150 per cent more than the cost by pipe line.
It must be remembered, however, that you cannot send all these different products through the pipe line. Some of them simply will not go. Strangely enough, in the pipe line running from the Turner valley to the refinery in Calgary you can send crude oil, and then you can turn in the white product. It will travel in the same pipe line to Calgary, and the admixture of one with the other at the end of the line will not cover a matter of fifty feet in the twenty-five mile line. It is an amazing thing. It is done by controlling the pressure of the flow, thereby maintaining the consistency.
There is only one more thing that I wish to say about oil, and it has to do with the matter of foreign exchange. I have said that at the present time we are producing, refining and selling about 70,000 barrels of oil per day. Multiply that figure by roughly $3 and you have at least $200,000 a day that the people of Canada as a whole are saving in United States funds. Formerly we got our crude oil from the United States. It is true we got some from the South American republics, but the South American oil was owned by United States companies. Therefore a dollar saved is a dollar gained in that business. Within an appreciable time we may strike a balance between oil for eastern Canada coming from nearby fields to Sarnia, and oil from Alberta-and I hope from Saskatchewan-moving	into the United
States.
I will go even further than the Minister of Trade and Commerce (Mr. Howe). He spoke about oil for Sarnia as the reason for the pipe line. I know perfectly well that pipe line is aimed at the Chicago area, and I am glad to admit it, because we want the best market we can get. In that way we can certainly do ourselves more good so far as United States dollars are concerned.
I am out on a limb now. There is no question about that so far as I am concerned. I speak only personally, but I know I am speaking for the oil producers of Alberta. I hope that production will increase-and it shows every sign of doing so-to such an extent that before this session of parliament 45781-85
The Budget-Mr. A. L. Smith is over we shall have enough oil coming up every day to supply the whole of the Dominion of Canada, and a market already established for our surplus. I think that is a realistic view of the whole oil situation, and I do not want there to be any doubt about where those who come from Alberta stand. Somebody will say: Smith, you are looking after your voters. But if they are all United States citizens they have no vote in Canada, and at any time I will take my chance with the Canadians who have.
I apologize, Mr. Speaker, for taking up so much time on one subject. I have not mentioned gas, but I will have a shot at that tonight. I have made these remarks because I believe oil is a matter of great interest to the members, and of tremendous interest to the country at large. I have spoken only of the oil which we bring up in pipes. In the region of the Athabasca river-and I was up there only recently-there are the tar sands which many authorities have pronounced the greatest reservoir of oil in the world. As a Dominion of Canada enterprise we have had bad luck with the project. While I have been a member of parliament I believe we have built two extraction plants, and by the time they were ready to operate them they were destroyed by fire. The province of Alberta is spending a good deal of money in that area today, and they say they are making some progress with the extraction of oil. It is not that the oil is not there in tremendous quantities. The difficulty seems to be to separate it from the sand. That is where we have fallen down. Water transportation is available there. Granted that the scientific problem is solved, it seems to me that in the future we may expect that there will be continuous development not only in Alberta but in Saskatchewan, and certainly in the Peace river district of British Columbia. They are now discovering oil in the region extending south from the old Norman Wells.
It seems to me that all these things added together mean that we have a basic product with which science is doing and can do much. The future, not only for that part of the country but for the whole dominion, as a result of the discovery and development of this great industry, is something that no one here can contemplate. My imagination simply is not good enough to envisage it.
In my office some time ago the most prominent chemical engineer in Canada was speaking to a geologist of a company for whom I was acting, and he asked him if he could find some salt. The chemical engineer laid down certain conditions as to the finding of the salt. In the same hole there had to be natural gas, and the find had to be beside a railway track. The geologist said that he thought it could be

The Budget-Mr. Decore done, and asked the chemical engineer how much he needed. The answer was that he needed a bed of at least six feet of salt. My friend was in Ottawa the other day-he is interested in pipe lines-and he not only found the natural gas right beside the Willingdon line in northern Alberta, a little east of Edmonton, but he also found a great quantity of salt. I saw pieces of it in my office, and it was as clear as the clearest of window glass. He found not only six feet of salt but a thousand feet. My chemist friend tells me that salt and natural gas are two of the most important elements in the making of many things such as plastics, and so on. This is something that is not merely in its infancy; it is in swaddling clothes.
I close with the thought that I am happy to live in Canada. I think we shall be contributing our share, in a land we love so much, if we contribute as much as some of these private enterprise people; and if we do, we shall not need to worry about the future.


Mr. John Decore (Vegreville):: Mr. Speaker, the introduction of the budget in the house is always of great interest and importance to the people of Canada because from it they derive a knowledge of the status of our present financial requirements as well as the country's future prospects. In recent days and weeks we in Canada have been greatly concerned with the serious deterioration in the dollar position of the sterling areas. We realize that this is not just a problem of the British people but, in view of our trade relations with the United Kingdom, it is also a problem for Canadians as well as the other peoples of the world. I am sure that the people of Canada were glad to hear the statement made by the Minister of Finance after the recent conferences in London and Washington, to the effect that those who took part in the discussions agreed on certain policies which it is hoped will assist the sterling areas in selling goods to Canada and the United States. If this were achieved, the result would be a balancing of accounts without further loans or Marshall aid. Although we are concerned, we are confident that the world-wide devaluation of currencies will finally be adjusted to a level which will permit Canada to continue its trade relations with other countries in a normal manner.
Although I am a new member of this house, I understand that hon. members have the privilege, during the budget debate, of discussing various topics. Might I mention first the fact that this parliament will probably go down in history as a landmark because of its attempt to change our constitution. Most Canadians feel that, although the British North America Act was a masterly piece of


work in its origin in 1867, conditions in Canada have changed and this act does not meet the expanding needs of this country. We must recognize, however, that the British North America Act was originally a very delicate compromise between the English and French-speaking Canadians. It is my submission that any contemplated changes in the act must necessarily take cognizance of these compromises if unity in Canada is to prevail. We do not know exactly what the premier of Quebec meant when he said that this was a matter of life and death. This statement, however, illustrates the difficulty we will encounter. Unfortunately, the premier of my own province of Alberta has chosen to follow in the footsteps of Premier Duplessis.


Mr. Low:: The hon. member is not stating a fact.


John Decore: I intend to bring to the attention of this parliament a matter which I consider of importance to the future of this country. We in Canada have made great strides in our social welfare program for the benefit of the Canadian people. I should like now to express my views about education. When I say I desire to express my views on that subject, I should say they are only my views and not the views of someone else.
It seems to me that when it comes down to the basic necessity of living, the basic element of human progress, education is one of the most important factors. Nothing could be more desirable or more far-reaching than the attempt of this parliament to improve the opportunities of education for young Canadians. After all, those young Canadians will be the fathers and mothers of our future generations. This country needs men and women with a high level of education, so that they will be better qualified in discharging their responsibilities as citizens.
Canada today is playing a gigantic role in the destiny of mankind. Canada is, in fact, a new nation with a great future before it. So far our natural resources have only been tapped, and we require men with skill in science and the technical knowledge to develop those natural resources. Educated men and women are required by this country in case, at some later date, it is necessary to defend it. After all, the educated citizens of this country will place higher values upon, and have greater appreciation of the fact that the freedom we are now enjoying has been handed down to us as a result of centuries of struggle. We have spent billions of dollars in trying to protect our democracy and our international position. Today we are heavily burdened with international problems, but this should not prevent the consideration of the advance of human welfare.

Education is the foundation stone in the structure of our democracy in Canada. It is the greatest weapon against poverty and hardship. For that reason, I feel that eventually we should adopt, as a basic principle, recognition of the fact that education is a national concern. During the past few years the people of this country realized with a shock what war and steadily rising prices had done to our schools. The constant financial pressure had made it difficult for many communities to keep abreast of the requirements of education. For a number of years I served as a member of the school board and noted, in my own town of Vegre-ville, the overcrowded classrooms and inadequate equipment. There was not much we could do about it because the taxpayer was already overburdened.
In my constituency today there are a number of districts where schools have been closed owing to a lack of teachers, or where the instructors are not qualified in the art of teaching. Many of the teachers have migrated to better jobs at better pay. When I speak of teachers I speak with some feeling because, during my younger days, I taught school. I am not here to champion the cause of teachers, but we must have an abundance of good teachers in Canada if our standard of education is to be at a satisfactory level. Able men and women must be encouraged to go into the teaching profession. I know of children who have attended my classes in public school who, although they possessed the ability to become some day great leaders of this country, were unable to pursue advanced studies because of financial difficulties.
This government has already gone a long way in aiding Canadians by the introduction of family allowances and the program to provide educational facilities for veterans. I believe the government should be prepared to go farther than that, eventually. When I suggest that this parliament should give some aid to provincial governments for educational purposes, I realize that some provinces are more fortunate than others because of the richness of their natural resources. The province of Alberta is indeed most fortunate in this respect. The wealth that is now pouring into the treasury of the provincial government as a result of the discovery of oil is, in fact, an embarrassment to them.
In our province of Alberta there is no earthly excuse for the government not making more substantial grants to education which would be in keeping with the requirements and the expanding needs in that province. The farmers upon whose land oil is discovered receive little direct benefit from the discovery because few of them have mineral rights. All that these farmers receive is the 45781-85i
The Budget-Mr. Decore rancid smell of oil twenty-four hours a day, seven days a week, plus a little compensation for the use of their land. It is for this reason that I believe the royal commission now investigating the question of education in Canada, among other things, will make an important contribution to the solution of this problem. Some formula needs to be worked out by means of which more opportunities will be created for education for our young Canadians.
I am not suggesting at all that this parliament should in any way encroach upon the subject matter of education which is now within provincial jurisdiction. I sometimes wish, though, that this parliament had some means of controlling the propaganda that is being fed to our children. When I say this, I am referring to something which has taken place in my province of Alberta. In 1937 a book was published by McDougall and Paterson called "The World of Today". This book was authorized by the minister of education, at that time the late Mr. William Aberhart, for the use of Grade IX pupils.
On page 321 of that publication you will find the following:
Some people feel that the capitalist (competitive) system is out of date in this modern world, and should be modified or replaced entirely by a system better fitted to deal with the problems of today. Three of these plans are especially interesting: the Communist (as in Russia), the C.C.F., and Social Credit.
I am sure that we have no objection to our children's knowing something about Social Credit theory, if they can only find out what it is, or about the C.C.F., the Conservatives, the Liberals or any other political party. But the fact remains that thousands of students in that province were subjected to this type of vicious propaganda. They were subjected to the idea that our so-called competitive system is out of date and should be entirely replaced by one of these three doctrines. It was only after this book had been in use in our province for some years, and after considerable pressure had been exerted on the minister of education and on the government of our province by individuals and various organizations, that this book was finally revised in 1940. I have here with me both of these books in case any hon. member should be interested in looking them over.
The revised copy in use in Alberta today is so similar except for the changes that I have already mentioned, and some cartoons that have been left out, that the old original copy is still used by a great many students in grade IX in the schools in our province; these books are handed down by their brothers and sisters who used them in previous years.

The Budget-Mr. Decore
It is not my intention to be disrespectful to any hon. member or to any political group in this house. However, I have heard of expressions coming from some of my Social Credit friends-and when I say some of them,
I mean just some of them-to the effect that my election to this house was made possible by the communist vote of the Vegreville constituency,-


Mr. Blackmore:: Hear, hear.


John Decore: -and I intend to deal with this matter. The insinuations are quite clear, Mr. Speaker. Such statements cast a reflection not only on the nine thousand people who voted for me in the election of June 27 but also on all the people in that constituency, numbering some 60,000.
We have in this house representatives from all parts of Canada, from Vancouver island to Newfoundland. I do not think that hon. members in this house should be left with the impression that whenever anybody mentions the constituency of Vegreville, they should associate that constituency with communism. I feel that I have the responsibility of defending the people whom I represent should any politician in this house or outside it choose to brand those people as communists simply because they chose to discard the kind of representation they had there for the last number of years.
Over half a century ago when these people came in from central Europe and settled on land around Vegreville, one of their chief characteristics was their deep religious feeling and devotion to the church. The first institutions which they built upon their arrival were churches where they could go and worship God. Today in this constituency you will find many churches of various denominations. The two main groups are the Orthodox and the Greek Catholic, both being churches of the eastern or Byzantine rite.
The village of Mundare, situated within my constituency, has been and is today the centre of the religious life of the Ukrainian Greek Catholics in Canada. Mundare is the cradle of the Basilian order which produced such outstanding religious leaders as Their Excellencies Archbishop Basil Ladyka of Winnipeg and Bishop Neal Sawaryn of Edmonton. Other outstanding religious leaders of the Greek Catholic faith came from this place called Mundare.
I might also mention in passing that in the early pioneer days a man by the name of Father Kryzanowsky came there as a missionary; he was responsible for putting Mundare in the position it holds today. Father Kryzanowsky has been highly respected by Canadians of various denominations and racial origins. He was closely associated with that great missionary and
[Mr. Decore.1
humanitarian of western Canada, the late Father Albert Lacombe. I mention this because the people in my constituency, regardless of the church to which they belong or of what their views may be, resent any such scurrilous attack made or insinuations cast by any such politicians.
It has been said that the fact that no communist candidate was running in Vegreville constituency in the election of June 27 was the reason my election was made possible.
I want to tell this house something about this matter. In my constituency there are elected to the provincial legislature about six or seven provincial members who are either wholly are partially dependent on the vote from my constituency. In the provincial election held last year, all those members who were elected from my constituency were Social Credit candidates.


John Horne Blackmore: Hear, hear.


John Decore: Some of my Social Credit friends and the hon. member for Red Deer (Mr. Shaw) say "hear, hear". I want to remind the hon. member that there was no communist candidate running, and I would ask him this question. Was it the communists who elected those Social Credit members at that time?


Mr. Shaw:: I rise on a question of privilege, Mr. Speaker. In the first place, I made no interjection whatsoever; and in the second place, if he wants an answer to his question, I would tell him this. The communists voted Liberal provincially last year.


John Decore: Is that the reason why most of the Liberals lost their deposits?
I should like to remind this house of another incident that took place in 1940. In 1940 a by-election was held in the Vegreville provincial constituency, which is in my constituency. At that time the hon. member for Peace River (Mr. Low), who is the leader of the Social Credit group in this house, was elected to the provincial house by acclamation. Was it the communists that in 1940 elected him by acclamation to the provincial house?


An hon. Member:: No; there was no election.


John Decore: It was by acclamation. I should like to take my Social Credit friends-


An hon. Member:: They would not go with you.


John Decore: -back to the year 1938. That was the year when, in the constituency of Edmonton East a federal by-election was held. That was the time when Orvis Kennedy, the Social Credit candidate, was elected. I do not hear anything from my Social Credit friends. None of them says "hear, hear" this time.


Some hon. Members:: Hear, hear.


John Decore: In fact, I notice that they are blushing; and they have good reason for blushing. Let me tell this house why. After the results of the election were known, there was in Edmonton one of the most enthusiastic demonstrations ever held in its political history. According to the Edmonton newspapers, communist supporters and other speakers addressed the crowds at the Kennedy committee rooms; Mr. Kennedy thanked Jan Lakeman, the Alberta communist chief, for his support and called him to the platform to address the crowd.
May I quote further from the Edmonton Journal.


Solon Earl Low: I rise on a question of privilege. The hon. member for Vegreville is reading into the record something that is absolutely false, and he knows it.


John Decore: Do you want me to produce it?


Mr. Sinclair:: Where is your privilege?


Solon Earl Low: I say that in all kindness to the hon. member.


John Ewen Sinclair: Where is your privilege?


Solon Earl Low: I am challenging the hon. member to produce the evidence of Mr. Kennedy thanking Jan Lakeman or any other communist for his support.


John Ewen Sinclair: That is not privilege.


John Decore: I accept the challenge.


Solon Earl Low: I challenge the hon. member.


John Decore: I accept the challenge. At this time may I quote from the Edmonton Journal of March 22, 1938. This is what it says:
Others who addressed the cheering crowd at the Kennedy headquarters were N. B. James, M.L.A. for Acadia; Leslie Morris, Toronto, national secretary of the communist party of Canada; Hon. E. C. Manning, provincial secretary; Hon. Lucien Maynard, minister of municipal affairs.
What a grand and glorious victory that was!


Solon Earl Low: On a question of privilege, I challenge the hon. member to substantiate by evidence that his statement is correct. I state exactly what he said, "that publicly at that meeting in Edmonton in 1938, Mr. Kennedy thanked Jan Lakeman for his support."


John Ewen Sinclair: That is not a question of privilege.


Solon Earl Low: I challenge his honesty on the statement he has made. He has answered my challenge by evading, as he always does.


John Decore: I am referring to newspaper clippings.
The Budget-Mr. Decore


Solon Earl Low: A newspaper clipping does not mean anything.


Mr. Knowles:: Don't forget that Tim Buck supported Mackenzie King in 1945.


John Decore: At no time in the political history of Canada, to my knowledge, did any political party,-


Mr. Gardiner:: He supported the C.C.F. in 1949.


John Decore: -whether it be Liberal, Conservative, C.C.F. or any other political group, celebrate together with the communist chiefs an election victory with such enthusiasm and gusto as happened in Edmonton East in 1938.
In view of what I have said, may I humbly make this suggestion to the hon. member for Red Deer (Mr. Shaw) and the hon. member for Peace River (Mr. Low), that they should be the last of all people to impute communism to someone else. It seems to me that people living in glass houses should always undress in the dark.
Most of us who know anything about the communist leaders in this country know something about their tactics. If you dare to disagree with a communist on his political views you are immediately branded as a fascist or a war-monger. Should anyone dare to disagree with some of these politicians to whom I am referring, they are immediately branded as a communist or next to it. Although they profess to hold divergent views it is my submission that their tactics are the same.
The suggestion that the Liberal party in Canada, or that a Liberal candidate in Alberta, entered into any kind of understanding with the communist leaders is of course nonsense. We of the Liberal party believe in combating communism not necessarily in the manner and style prescribed and proposed by our Social Credit friends. We believe that by showing that our democratic way of life here in Canada is superior to what they have in Russia we can convince people far more effectively.
In the 1945 election there were in Canada 119,000 communist votes. On June 27 there were slightly over 32,000. Something happened to the 80,000 communist votes, in fact it is only a little over one-sixth of the 1945 election. I believe that if any party or any group has shown the way to combat communism in Canada, the Liberals certainly have.
At this time, Mr. Speaker, I should like to say a word or two to my French-speaking Canadian friends.
(Translation):
As a representative of western Canada, I am very pleased to meet here so many French-Canadian members from the eastern part of the country.

The Budget-Mr. Argue
There are a great many French-speaking Canadians in my constituency and I am happy to tell you that they wholeheartedly supported me at the last election.
Fortunately, there are only two official languages in this country, French and English. If other languages are officially recognized, I should be tempted to use them all.
We in western Canada are deeply anxious that unity should prevail in this country and judging from what I have observed during the short time I have been here, our nation is destined to become even more powerful and united under the leadership of our great leader, the Right Hon. Louis S. St. Laurent.
(Text):


Mr. H. R. Argue (Assiniboia):: Mr. Speaker, the budget presented to this house by the Minister of Finance (Mr. Abbott) the other evening was not essentially a new one. In the main it was the budget presented March last, prepared for re-presentation. On June 27 the people of Canada endorsed the resolutions contained in the original budget. The people of Canada endorsed the tax proposals of the Liberal government, and to that extent I do not wish to take exception to the present budget. But if the forecasts and opinions contained in the budget of the Minister of Finance of March last were not justified by events, then to that extent the budget of March was not endorsed by the Canadian people.
One may look through the budget of last March with great care, but nowhere in it will one find a suggestion that Canada would in a few months be facing a very serious trade crisis. On the contrary, the Minister of Finance took a very optimistic point of view. I might recall the statements which the minister made in referring to European countries when he said:
Their own ability to buy is increasing, and in the meantime is being supplemented from this side of the Atlantic.
Then the further statement:
The Canadian government has taken and will continue to take all feasible steps to encourage the expansion of British trade with Canada.
These statements, and others like them, served only one purpose. They served to lull the people of Canada into a false sense of security in relation to our trade prospects. One cabinet minister after another went back and forth across this country telling the electorate that we would not be facing a trade crisis; that the C.C.F. were always talking blue ruin. It must have been a shock indeed to the electorate to find that within twenty days after the election we were facing a very severe and very real trade crisis, a trade crisis to the extent that our best customer,

Great Britain, announced that she was cutting by 25 per cent imports of goods from dollar countries. The Minister of Trade and Commerce (Mr. Howe) is reported in the Regina Leader-Post of June 18 under the headline:
Howe Tells B.C. Liberals he is Stuck for Something to Sell
as having said:
Canada's post-war domestic economy is expanding so fast, Trade Minister Howe said Friday, that he is stuck for something to sell on the overseas market.
The Minister of Agriculture (Mr. Gardiner) is reported in the Leader-Post of June 24 as saying at Qu'Appelle:
There is no evidence to support the contention of M. J. Coldwell, C.C.F. leader, that Canada is losing the British market for food, Agriculture Minister Gardiner said here Thursday night.
I hold in my hand a quotation taken from a radio speech delivered by the hon. member for Rosetown-Biggar (Mr. Coldwell), the leader of this party, on May 13, entitled "Coming Crisis in Trade",
Our best customers have always been Britain and western Europe, yet we are rapidly losing these markets today. Last year Canadian exports to Britain fell off by $64 million. In the first three months of this year exports in Britain dropped still more, from $175 million to $139 million. We have not suffered from this trade crisis yet, but in a few months we shall feel the full impact.
How very true was that prophecy by the leader of this group, that while we had not suffered up until that time from the trade crisis, nevertheless in a few months we should feel the full impact. Just two months from that date, almost to the day, the announcement was made that we would be losing 25 per cent of our market in the United Kingdom. Apparently to some extent the Minister of Agriculture (Mr. Gardiner) has changed his mind, because he was reported in the Montreal Gazette of October 1-


James Garfield Gardiner: That was not agricultural products; it was 25 per cent of our dollars.


Hazen Robert Argue: A reduction of 25 per cent in British purchases in dollar countries.


James Garfield Gardiner: Not of food from Canada.


Hazen Robert Argue: The Budget-Mr. Argue
He admits that there is a possibility of a recession in the United States in the future, but then he adds that the government has a program to maintain full employment and prosperity in Canada. The minister said:
. . . we have already taken steps to give still greater encouragement to housing construction, and we are in the midst of discussions with the provinces regarding both the magnitude and the timing of extensive work on the trans-Canada highway.
I wonder why the minister did not include the irrigation development in Saskatchewan about which we have heard so much for so many years. Apparently that is not to be one of the projects to be undertaken to maintain full employment in Canada. In speaking of the trans-Canada highway he referred to the magnitude and the timing of this extensive work. I did not know that its construction was tied to the minister's theory of cyclical budgeting. I thought the government's stand was that Canada needed a trans-Canada highway, and that the government would help in the completion of it with all dispatch. But surely the minister does not believe that Canada can maintain full production and full employment at a time of recession in the United States and still follow the policies that are being followed by the government today.
If Canada wishes to maintain full produc-;ion and full employment at a time when there is a recession in the United States, then it will necessarily mean the reimposition of rigid government controls. The present government is against controls. Therefore I can only assume that, if there is a recession in the United States, it is going to overflow into Canada and there is nothing that this government will do about it.
The Minister of Trade and Commerce (Mr. Howe), in answering a question today, referred to two of the deputy ministers who have been in Great Britain discussing our trade problem. I should like to point out that those gentlemen were in Great Britain discussing the possibility, as I understand it, of concluding a bilateral agreement for the sale of such commodities as bacon, cheese and eggs. The Minister of Finance read us a lecture in March of last year about the evils of bilateral agreements. Notwithstanding the minister's lecture the government, and I compliment them for it, are still trying to maintain bilateral agreements even if they are for reduced quantities. Why should we and the government expect Great Britain to sign bilateral agreements with us for the sale of our commodities if we will not do exactly the same thing for the British and sign 'bilateral agreements for the sale of British goods in Canada? I believe through bilateral agreements we have one positive method by

which we could increase our purchases of British automobiles, farm machinery, textiles and other manufactured goods. The government should not set itself against adopting new and, if necessary, radical changes in its trade policy, if by that means it could cope with the present reduction in markets. In my opinion, the government should have no hesitation in accepting the amendment of the member for Moose Jaw (Mr. Thatcher) calling upon it to reduce tariffs and to implement a policy of freer thade, something that the government and the Liberal party have been talking about for many years.


Mr. Gibson (Comox-Alberni):: I hope the hon. member is not quoting him as an authority.


Hazen Robert Argue: I believe the member for Moose Jaw (Mr. Thatcher) would be a much better authority than the hon. member for Comox-Alberni.
I have one other suggestion to make before I conclude.


Mr. Deputy Speaker:: The hon. member has exhausted his time and cannot continue without the unanimous consent of the house.


Some hon. Members:: Continue.


Hazen Robert Argue: I should like to leave one other thought with the house, and that thought came to me when the Prime Minister of India was addressing the joint houses of parliament a short time ago. India has large sterling balances in London. As a sister nation in the commonwealth, India would like to exchange those sterling balances for dollars and increase her imports. I believe this government should consider taking over part of India's sterling balance in London, as a means of helping to improve our market situation. We would be helping Great Britain solve her serious dollar crisis, and at the same time we would be helping to raise the standard of living of millions of our fellow human beings who reside in the sister nation of India.


Mr. A. C. Stewart (Yorkton):: Mr. Speaker, we have just listened to another speech from a member of the group I designate as the unlucky thirteen. For many days we have listened to their speeches, and now I have to speak on an amendment to the amendment which is a typical C.C.F. amendment. As a matter of fact we have a half-Conservative and half-C.C.F. amendment to the government motion. It suggests that we-
-give immediate consideration to a reduction of tariffs sufficient to encourage an increase in imports from the United Kingdom and other sterling countries.
The party in question sponsoring the amendment knows quite well that the government of the day has, for many years now,

given consideration to that very thing. The amendment means absolutely nothing. This group knows the government has been doing that, and is still doing it. It is also well known that the government intends to get as much for our western wheat as it is possible to obtain. This amendment does not go far enough, if my hon. friend wanted to secure something for the western farmer. There is no question about it, the westerner feels that he is buying everything on a closed market and selling everything on an open market. Ninety per cent of the people west of the great lakes are natural free traders.
If my friends of the C.C.F. could have brought forward a suggestion that we have two kinds of money as well as being a bilingual country, everything might be all right. We have not got two kinds of money. We cannot use sterling on the one hand, and the dollar on the other. I should point out that in many announcements the government has made it quite clear it does not believe in bilateral trade agreements any more than does the British government. That government has clearly stated that it intends to get out of bilateral agreements as fast as possible. Our government of the day has made it clear that it believes in multilateral trade. That is all I intend to say about that, except to say that the member introducing the amendment was the member for Moose Jaw (Mr. Thatcher).
At page 1027 of Hansard, the member for Moose Jaw said:
Hon. members of the Liberal party will see that there are no strings attached to that amendment. Anyone who believes in freer trade should have no difficulty in voting for it. I call upon my Liberal friends to vote the way they have been talking for the last fifty years.
I shall suggest to the hon. member for Moose Jaw, who is a fairly young member in the C.C.F., that sometime he read the prayer of that old gentleman whom we all used to respect, the late Mr. Woodsworth. He said:
We have learned how imperfect is our knowledge, how narrow our vision. May we be willing to welcome truth from whatever source it comes. May we endeavour to follow the truth at whatever cost.
My hon. friend from Moose Jaw knows that there are strings attached to this resolution. He knows that any member of this house who votes for that amendment is voting no confidence in the government of the day. The same use would be made of a vote for this amendment as was made of a vote recorded in this house previously on the matter of the means test. It was a very unfair use, and many people who do not know the rules of this house-


Stanley Howard Knowles: Order.
The Budget-Mr. A. C. Stewart


Alan Carl Stewart: I am in order. I
am not going into a previous debate at all. You are out of order. A very unfair use was made of that vote by the leader of the C.C.F., the member for Rosetown-Biggar (Mr. Cold-well). His statement is reported in the press as follows:
Speaking from a prepared text in support of Harvey Hotrum, C.C.F. candidate in the Toronto Greenwood federal constituencywho, incidentally, lost out.
-Mr. Coldwell said, "the Liberal government already has broken faith with many of those who supported it with their franchise last June." He said that, because of the oft-repeated Liberal promises, "many old age pensioners thought by voting Liberal they would make sure the burden of the means test would be lifted. However, in the House of Commons last week not one Liberal had the courage to vote for this simple but needed reform."
I would suggest that the hon. member for Rosetown-Biggar follow the precepts of that great leader, Mr. Woodsworth. That is not telling the people what the facts of the case are; it is a misleading statement. Every member of this house is put in the position of having to explain the rules of this house to his constituents, and the effect of voting for an amendment of that sort.
Sometimes I think the rules committee-as a young member of this house perhaps I should not be making these suggestions- should consider tacking on at the end of amendments to the budget motion or any other motion, "This is a vote of confidence in the government", or "This is a vote of non-confidence in the government". I know that in my constituency, seventy per cent of the population are foreign-born, and all these things have to be explained. I know that the same misuse will be made of that vote all throughout Saskatchewan as was made in the speech by the leader of the C.C.F.
In a report appearing in the Ottawa Citizen, the leader of the C.C.F. is reported as follows:
He pointed out that not one Liberal member had supported the means test for pensions "yet many promised such support in election speeches."
I may say that not only is every member of the Liberal party to whom I have spoken in favour of what has happened in connection with social services, but expects further things to happen when the government has had time to perfect the scheme. We do not want any imperfect schemes such as the one that was adopted in the province of Saskatchewan. We do not want a half-baked scheme brought into this house.
Then my friend the leader of the C.C.F., speaking to the Canadian Congress of Labour, said: Not only do I represent labour but we also represent that great group of agriculturists in this country.

The Budget-Mr. A. C. Stewart


Mr. Sinnoil:: That is nonsense.


Mr. Siewart (Yorkion):: Nevertheless, Mr. Speaker, he assured labour, at the Canadian Congress of Labour meeting, that he represented the agriculturists of this country. If he represents agriculture, then I represent the Hottentots. Let us look at the C.C.F. membership in this house. There are some good fellows in the C.C.F., although they are sometimes hard to find. But the C.C.F. have one bona fide farmer sitting in this house. There is one fruit grower and there is a half farmer, as you might call him, who just spoke; that is a total of one and a half farmers and a fruit grower. None of the rest of them are agriculturists. That is their total agricultural representation in this house.
If you take it constituency by constituency, and province by province, you will find that in many of the provinces where there are many agriculturists, the agriculturists have no representation in the C.C.F. The people of the country may be astounded to know that the Conservative party in this house have a representation of farmers which is fourteen times as great as that of the C.C.F. party. I would suggest that my friend the leader of the C.C.F. should follow the suggestion that was made by Mr. Irvine at Winnipeg when he said: We no longer represent the farmers; it is obvious that we do not; we should come out in true colours as a labour set-up. Then of course they would not represent all of labour by any means.
Some of us who have been sitting in this house as younger members would much rather have heard older members speak. We feel that we do not know it all by any means, that we have a great deal to learn, and that we are here to learn. But we have been getting such a barrage from the corner over here to my left that we have not learned a great deal.
I checked up in the Parliamentary Guide to ascertain the complexion of the members that now represent the C.C.F. in this house. You will excuse me, Mr. Speaker, for dwelling on the C.C.F.; I do so because in Saskatchewan certain events are happening now and certain events are going to happen again. We gave them a start in that province, and we do not want to see the rest of our beloved country filled with them. Whom do they represent? On a check-up we find that, of the membership of the C.C.F., eight were born outside Canada altogether. That is all right. We welcome immigration. We always have done so and always will. But those men have reached maturity outside Canada. They made up their political views


outside Canada. There are many of us Canadians here of English-speaking stock, whose ancestors have been here for possibly five generations. I have driven around the Gaspe peninsula with the Hon. J. E. Perrault, my old friend who is unfortunately dead. He used to be minister of roads in Quebec. I met the people of Gaspe peninsula. I spent three pleasant days there. They had a terrific storm. I watched those people under every circumstance, and they were a fine people. They had been in there for three or four hundred years.
As I say, we have a group here, eight of whom made up their political minds outside Canada altogether, who are coming to this country now and telling us that we are all wrong, that we should set up a new system, and that they have the answers. I can just imagine, and I have been doing it since away back in 1914, what in the world the English-speaking people or the Scotch on the Clyde would say if we sent over there a little group of Canadians who said: You are all wet over here; let us get a new government; your whole system is wrong, and so forth.
There is no question about this matter, because I am referring to the leader of the C.C.F., who wrote a book. Some people say that when you go into politics you should never write a book. This is a book by Major J. Cold well, and he gives a military command "Left Turn Canada". On page one he says:
As a young man and a student my interest in political affairs was aroused ... as a participant in college debates when I had to argue against well-informed young radicals . . .
He must have lost the argument, I think. He continues:
To these early discussions I attribute my present views.
So he brought them here; after being defeated in debate by radicals in England, over here he comes and we have to start all over again.
We have in Canada splendid people from every country. In my constituency many nationalities are represented. Many of those people are advancing splendidly. We have people from the old country who are at the head of a good many affairs. The latest appointment to the position of head of the Canadian National Railways is a demonstration of the truth of that statement, and we welcome it. But these men do not turn around and try to tell all other Canadians that their system is wrong and that they have got to change things. When we start to dissect any group it is fair to ask these questions: Where did they get their opinions? Are their opinions reasonable and are they logical? That is the proper approach; it is

not personal. I think these gentlemen are wrong and I have no hesitation in saying so.
I want to say this. In this house I do not intend to indulge in any personalities. I do not think we are sent here for that purpose. Some sharp debates are going to take place.
I think that is helpful. As long as they are conducted fairly, without anything personal in them, no harm is done, and that is the proper method of debating. But unfortunately, before I came to this house-and I think I should clear the decks on this matter-my friend the leader of the C.C.F. had certain things to say about me last session. I was not in the house to defend myself and had no opportunity of doing so, but I am here now.
The debate in question took place on March 10 of this year and is reported in Hansard, volume 2, pages 1342 to 1349. It took several pages of Hansard, and it all related to things that happened twenty years ago. I do not know that it is going to help this house much for me to try to settle this debate but it will at least clear the decks and show the people what's what.
The hon. member for Rosetown-Biggar (Mr. Coldwell) apparently had boasted that he had been offered a cabinet position by the then Liberal government of 1929. The Minister of Agriculture (Mr. Gardiner) successfully proved that he had not. Then I was pulled in as the innocent lamb in the whole thing. I did not care whether he had or whether he had not. Here is what was said about me. I am reading now an extract from Hansard of March 10, 1949, at page 1344:
The only part of Mr. Thorn's letter that I shall read Is that which affects me and which reads: ''We proceeded to congratulate them, and when we had completed doing that, Carl Stewart"-
That's me. I continue:
He was subsequently minister of highways and I think he was wholly responsible for the wreck, if I may put it that way, of the Conservative party in that province.
I want my Conservative friends to get that. I continue:
In the last election in 1945 he was the Liberal candidate in the Yorkton constituency.
"Mr. Stewart said, 'Now boys that you have congratulated us we would appreciate you leaving, as when all is said and done, we are elected members and we wish to discuss our plans, and while we appreciate your assistance during the election, that is all behind now, and we don't need your assistance here.'
"The three of us immediately began to splutter,"-
That is, Mr. Coldwell spluttered, Mr. Thorn spluttered-
"and the other members present at once began to assure us that they didn't want us to leave, the two exceptions being Taylor and Stewart.
"By this time you had become quite annoyed-
The Budget-Mr. A. C. Stewart
That is, Mr. Coldwell.
"-and you proceeded to give Carl Stewart one of the best dressings-down he ever had, and Carl sat and took it. He never said one word back and he never got any encouragement from any of the members to say one word."
Referring to the Minister of Agriculture (Mr. Gardiner) he said this:
"He paid tribute to the straightforward and clean-cut campaigns of the Progressives and Independents."
Of which I was one. At least I got a compliment there.
I continue:
"He assured me that he quite realized that we did not get behind the Conservatives in their campaign to vilify the Roman Catholics and to pep up the K.K.K. organization."
That is what my hon. friend read in the house concerning myself. I have asked the hon. member for Rosetown-Biggar (Mr. Cold-well) to table in the house the whole of Mr. Thorn's letter. I wrote to him and I wish to table my letter to him.


Stanley Howard Knowles: The hon. member cannot do it.


Alan Carl Stewart: Then I shall read it into the record. It is dated October 3, and reads as follows:
Not having been a recipient of Hansard in recent years, I was very surprised when I got down here to read your comments about myself in the 1949 session, and learn you had referred to a letter written to you by Mr. G. W. Thorn, barrister of Regina.
These happenings were, of course, twenty years ago, and I cannot see what object you had in making the remarks about myself in the altercation which took place between yourself and the Right Honourable Minister of Agriculture.
Have you any objection to forwarding me a copy of the letter of Mr. G. W. Thorn which, apparently, you are willing to table in the house and which, apparently, was not confidential as you used part of the letter.
I shall read the reply of the hon. member for Rosetown-Biggar. It is dated October 5, and reads as follows:
Dear Mr. Stewart,
In your letter you asked me two questions: (1) What object I had in making the remarks about you in connection with the altercations which took place between the Minister of Agriculture and myself.
If you have read the record, as I think you have, you will have noted that, referring to the setting up of the Anderson government, he said: "I am not so sure that he (meaning myself) did not put them in." I thought I had to quote- that part of Mr. Thorn's letter which indicated who, in my opinion, was responsible for the entry into the Anderson cabinet of Dr. Stipe and yourself. That was one reason. The other was,-
I want the house to get this.
The other was, of course, that from time to time I have been informed that you had made the statement that you had thrown me out of the room in which the discussion occurred at the Kitchener
1340	HOUSE OF
The Budget-Mr. A. C. Stewart
hotel. These were the considerations that were in my mind and which I thought justified my references to yourself.
Of course I never made any such statement, and never mentioned it before he said it in the house. I continue:
The second question you ask me is if I would forward to you a copy of Mr. Thorn's letter, which you state I was willing to table in the house. I did not offer to table Mr. Thom's letter in the house, although I had earlier offered to table a letter from Dr. MacLean, from which I quoted. I was under no obligation to table either letter, and I refrained from making the same offer regarding Mr. Thorn's letter as I had made in connection with Dr. MacLean's, because it contained certain comments and recollections which, while I think they were accurate, I am sure you would agree would be better left out. For exactly the same reason I am not forwarding you a copy of Mr. Thorn's letter, as I think no good purpose would be served.
I did not get a copy of Mr. Thorn's letter. Of course, if any hon. member had wanted Mr. Thorn's letter tabled at that time under the rules my hon. friend would have had to table it. Anybody could have asked for it.


Mr. Homuth:: No.


John B. Stewart: Yes. He was reading from a letter. I am right on that. I have looked it up. In any event I could not see the letter. The hon. member for Rosetown-Biggar made an attack on a former member of parliament who was not in the house at the time. He refuses to produce the letter. What was the record of Mr. Thorn? My hon. friend knew it very well. If he had been giving to this house the word of a reliable man there might not have been any objection to it; but I happen to be a past president of the law society of Saskatchewan. I also happen to have been recently re-elected by acclamation a bencher of the law society. It is our duty to discipline members of the law society of Saskatchewan. I also wrote to Mr. Thorn to get a copy of this letter but could not get it.
What is the record on the law society records of the province of Saskatchewan of the authority quoted by the hon. member for Rosetown-Biggar in this house? I will read it. G. W. Thorn was reprimanded by the benchers on May 22, 1946, for neglect of his client and failure to reply to a complaint. There have been complaints of every conceivable nature against this man for years, justified from the point of view of the client and very detrimental to the profession as a whole, no one of which has been serious enough to warrant disciplinary action. Ever since he has been admitted there have been complaints, usually of sharp practice, cruel zeal in pursuing honest but poor debtors and excessive charges and generally taking advantage of poor and ignorant people. None of


these have been formal complaints but have come to the notice of the secretary by letters and interviews.
As the hon. member for Rosetown-Biggar knows, Mr. Thorn is one of the biggest capitalistic lawyers in the city of Regina. He has got the first two dollars he ever made and owns a block and charges high rentals. That is the authority whom the leader of the C.C.F., who is out for social justice, gives to this House of Commons. I want to say that the statements made in Mr. Thorn's letter are absolutely untrue. There were eleven members elected at that time. We were elected as Independents and Progressives. There are many Liberals in this house who used to belong to the Progressive group. As a matter of fact there were 65 sitting in this House of Commons at one time, and one of them is now sitting in the Senate. In any event, that was the organization. Eleven were elected of whom I was one. The hon. member for Rosetown-Biggar was not elected. He was not even a candidate. He was only a member of the Progressive executive. He had no authority to dicker with anybody for a cabinet job because he was not elected. He was not elected for the city of Regina and never has been. He had to chase up to the city of Rosetown where there was a Progressive movement in order to get elected. Thank goodness I have been able to run in my own constituency, and whether I got beaten or elected I have always run in the same place. All he was told was that we, the elected members, would have to make a decision. And every one of the elected members there was elected in opposition to a Liberal. Our instructions were plain from our own committees and our own seats, and we followed them. We formed a coalition government, just as a coalition government had been formed in Manitoba, where even the C.C.P. joined in, and in British Columbia where they have a coalition today.
Now he says I wrecked the Conservative party. To my Conservative friends I say this, that I never heard one of the Conservative ministers with whom I was associated ever make any such statement, or even imply it. As a matter of fact, when it came to a general election, in accordance with my duty as a coalition member I spoke in more Conservative seats than any member of the government, apart from the premier and the Minister of Agriculture (Mr. Gardiner)-only he had a better organization than we had.
The only thing that did happen is that, without letting the government know-and remember this, that the hon. member for Rosetown-Biggar (Mr. Coldwell), who is flailing the Conservatives, took a job from the Conservatives in that very government

as a commissioner to inquire into the civil service, and was paid for his work. I have the figures here. He took that job, and then after the government was in he turned around and formed a labour party, without telling any of us and without suggesting that we were doing things wrong. It was easy to form a new party in Saskatchewan in those days, because we had drought over three-quarters of the province in four consecutive years. In addition to wheat being down to 22 cents a bushel, we had that drought. It was easy to form a party then, a despondent party. But you can see what happened since. Since we have had a Liberal government and prosperity the C.C.F. have waned in Saskatchewan. And that is a natural consequence.
But so far as the Conservatives are concerned I wish to say this-and the hon. member for Rosetown-Biggar well knows this -that when it came to the final analysis of that government, when we needed $3 million for relief, I was the member of that government chosen to come down to tangle with Mr. R. B. Bennett, and the one who managed to persuade him to pay $3 million, or our cheques would not have been cashed. I had to do that job.
I am pleased to say that a lot of Conservatives in Saskatchewan still appreciate the roads I built out there. Not only that, in my constituency when my candidature in this election was announced the Conservatives in my home city of Yorkton took down their bills and vacated their committee rooms. So I do not think the Conservatives felt quite as badly about me as the hon. member for Rosetown-Biggar would like to make out.
Then, in addition, I have not relied upon my statement in this matter. I have written giving the version that the hon. member for Rosetown-Biggar gave of this affair. I wrote to a C.C.F.'er who sat as a Progressive member then, and to two other independents of Conservative leanings. I have all those letters here. They show absolutely that what Mr. Thorn says is incorrect. I am prepared to table these letters, but under the rules of the house, namely citations 265 and 269, I cannot table them without unanimous consent.


Some hon. Members:: Granted.


Some hon. Members:: Agreed.


Mr. Deputy Speaker:: Has the hon. member unanimous consent of the house?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Alan Carl Stewart: Now, the hon.
member for Rosetown-Biggar has not always thought ill of me, apparently, according to what he said in the legislature. I do not know
The Budget-Mr. A. C. Stewart whether his great zeal to make a point out of the Minister of Agriculture led him astray or not. However, I have here an issue of the Yorkton Enterprise in which reference is made to the Theodore meeting of October 17, 1938, wherein the hon. member for Rosetown-Biggar said-and this was 1938, long after I am supposed to have done these things to some people in Regina-that I was one of the best Progressives in the west. And if he likes I will quote the whole article-


An hon. Member:: Let us have it.


Alan Carl Stewart: Here is what he says-and I do not want to take up too much time on this, because there is a lot more. This is the quotation from the Enterprise, the editor of which, incidentally, is a cousin of the Minister of Fisheries. He says:
A year ago when M. J. Coldwell, national leader of the C.C.F. party, spoke in Yorkton in the interests of A. P. Swallow in the provincial election, I put this question to Mr. Coldwell at the conclusion of his address:
"In your public appearances in Yorkton has The Enterprise 'covered' your addresses fully and fairly?"
Mr. Coldwell replied:
"The Enterprise is one of the few papers in Canada which invariably reports me fully, accurately and at length."
All right; now they quote you at length. Kenny goes on to say:
I was at Theodore on October 17, 1938, when the C.C.F. held their convention. They tried to nominate in the afternoon but couldn't make a decision. Charles Beck, Senior, was an exponent of Social Credit in those days. Mr. Coldwell admitted he would like-
And the Social Crediters will enjoy this-
-to see the convention choose a fusion candidate. He felt the Social Credit was O.K., but William Aberhart apparently didn't like the C.C.F. . . . Speaking in support of the C.C.F., Jacob Benson, C.C.F., M.L.A. for Last Mountain who had previously been the C.C.F. candidate in the Yorkton constituency, said in part:
"I am glad to be here associated on this platform with Carl Stewart. I had the honour of sitting with him in the legislature. I said once in Yorkton and I repeat it here tonight I cannot understand why they defeated Mr. Stewart in 1934 because he did more for Yorkton in his five years in Regina than was done by all his predecessors for Yorkton in the legislature."
Then, we will get to the more interesting part-because the C.C.F. have claimed I am really C.C.F. sometimes. This speaks about fusion. This editorial continues:
Mr. Stewart was in a virtual hive of C.C.F.'ers that night. Here is what he said:
"Some say I am riding three horses. As a matter of fact, six horses came all harnessed up for me before the election began. I am not bound to any political party. My father was a Liberal and my mother a Conservative and I am a Progressive."
I think between the two of them they made an independent-but one should not say that.
"I do not believe that people are so much concerned with the name of a party as they are with action."
1342	HOUSE OF
The Budget-Mr. A. C. Stewart
And just who were those C.C.F. that sat on the platform and applauded this statement by Mr. Stewart? M. J. Coldwell, national leader of the C.C.F.; G. H. Castleden, the C.C.F. nominee for Yorkton; Jacob Benson, C.C.F. member for Last Mountain-
And so on.
And what was it again these people wanted? Remember their two, and only two, resolutions? They said give us $1.03 a bushel for our No. 1 Northern wheat f.o.b. Fort William and $6 per cultivated acre for lands which do not produce either because of crop failure or crop curtailment policy.
That is the report of that meeting. In addition, when I decided to quit running it was because they had completely undermined my organization. I sat in the following legislature as an independent alongside C.C.F.'ers for five years. During that time I went after the C.C.F.-it is all on record. I could not see their policy on socialism. While I sat in opposition to the Liberal party, I could not follow the other policy of the C.C.F. I could not follow them fully. The papers in our province were filled with what I had said at that time about the C.C.F.
I went back to my constituency and called a special meeting because I wanted to clean this all up so that it would not come up again. At that meeting I gave the complete history to the people of my constituency. At that meeting were seven of the C.C.F. executive. Then I left the meeting and told them to decide from the record what they would do. That meeting, which included seven of the C.C.F. executive, voted unanimously in approval of what I had done during the five years in the legislature. I thought that that was the democratic thing to do when I decided to quit.
The C.C.F. said that I could go to their convention and speak. I said that I could not, that I could only tell them what I had said before, that I am not a believer in all-out socialism. I believe in reform and I think every good Liberal believes in reform. The C.C.F. simply said, "All you have to do is to sign a membership card and you can get in." I said that would be all right provided it did not bind me to anything. They were going to allow me to speak to the convention, the local group.
The fact is that they would not do that even if you paid them a dollar. I could not even get in to the C.C.F. meeting. My hon. friends in the C.C.F. can have such chaps as Richards of The Pas and these other fellows whom they keep on hand right up to the federal elections and then they call them communists and kick them out. That is just the difference. The C.C.F. meetings are closed meetings. You have to pass their doors almost as you would pass through the doors of the Kremlin.


Mr. Speaker:: I must inform the hon. member that his time has expired.


Some hon. Members:: Go ahead.


Stanley Howard Knowles: Mr. Speaker, I object to further time being granted and I rise on a point of order.


An hon. Member:: We will remember that.


Alan Carl Stewart: That is all right; I will have another forty minutes later on.


An hon. Member:: Go ahead.


Stanley Howard Knowles: The point of order has to do with the documents which the hon. member asked to table during the course of his remarks. I was not clear from the way those documents went back and forth from one table to the other whether they were being tabled as parliamentary documents or whether they were being placed on Hansard. If they were being placed on Hansard there were several of us who shouted "No", so the hon. member did not have unanimous consent to place those letters or documents on Hansard.
So far as the tabling of documents is concerned, I would call attention to citation 316 of Beauchesne, second edition, which says:
The same rule-
That is the rule having to do with the tabling of documents.
-however, cannot be held to apply to private letters or memoranda.
The last sentence reads:
Lord Robert Cecil contended that the papers, having been cited, should be produced; but the Speaker declared that this rule applied to public documents only.
I know that on former occasions when hon. members have been asked to table documents and have consented to do so the former Clerk of the house returned them, stating that as they were private documents they could not be tabled. My point of order is twofold. I contend that if the hon. member was asking permission to table the documents he would be out of order. If he was asking that they be printed in Hansard I contend that that could not be done without unanimous consent.


Alan Carl Stewart: On the point of order, I looked at the hon. member for Rosetown-Biggar (Mr. Coldwell) when I suggested that they should be tabled, and the hon. member nodded his head. I took it for granted that there was no objection.


Stanley Howard Knowles: The hon. member for
Rosetown-Biggar said, "No".


Mr. Speaker:: I do not know of any rule that permits documents such as the hon. member has mentioned to be tabled in the
[Mr. Stewart (Yorkton) .1

house. My recollection is that the rule applying to the tabling of documents applies to public documents only.


Stanley Howard Knowles: What about the request that they be placed on Hansard? Is it understood that the hon. member did not have unanimous consent for that?


An hon. Member:: Yes, he did.


Mr. Speaker:: If the hon. member for
Winnipeg North Centre was in the house when the request was made to have the documents inserted in Hansard and did not agree, there would not be unanimous consent.


Stanley Howard Knowles: I said, "No", and several of us here said, "No".


James Garfield Gardiner: On the point of order, I have listened to all the discussion and the same thing happened as happens almost every time that extra time is asked for. When the request was made there were two members of the C.C.F. party who said, "No". I took the trouble of looking over there at the time and both hon. members were smiling. When it was suggested again that the house give unanimous consent, no one said "No" the second time and the letters were presented to the Clerk and, I presume, are going to be printed. I submit for the consideration of my hon. friends that these things are done in order to save time. The hon. member would have a perfect right to speak again for forty minutes on the main motion when he could read the letters into Hansard. I would suggest that they be allowed to go in.


Mr. Coldwell:: I do not mind whether these documents go into Hansard, but there is no doubt that when the request was made of the house the answer was "No". I do not know whether the minister listened the second time, but I heard hon. gentlemen near me say, "No" each time the question was asked.


Mr. Speaker:: In view of what has been said by the right hon. Minister of Agriculture and the hon. member for Rosetown-Biggar may I consider that the hon. member now has unanimous consent to have these documents inserted in Hansard?


Some hon. Members:: Agreed.


John B. Stewart: The letters read as follows:
Invermay, Sask., 10th October, 1949
A. C. Stewart, Esq., M.P.,
House of Commons,
Ottawa.
Dear Carl:
Your honourable friend went back twenty years to find a little dust so that he might make dirt out of it; but then he has spent most of his years word-mongering. "With words we govern men," said Disraeli, 'Tis too true; words, too often failing to square with facts, are the stock in trade of those
The Budget-Mr. A. C. Stewart who would hold arbitrary authority over others. You have the facts of the incident pretty well as they took place in Regina at the meeting referred to in your recent letter.
M. J. Coldwell was trying at that time to keep too many doors open to give anyone a dressing down; in fact he was almost brought in the back door as public service commissioner for Saskatchewan. Some of those who spoke on his behalf, and were supposed to know him better than you or I, said he could qualify under veterans preference, as he was a major; and that name his mammy gave him has fooled a lot of people since. To me he never was more than the chocolate major.
Kind regards to all and good luck,
Sincerely,
J. R. Taylor
Manitou Beach, Watrous, Sask.
October 15, 1949
A. C. Stewart, Esq., M.P.,
House of Commons,
Ottawa, Canada.
Dear Carl;
Yours of October 7 to hand, and I was indeed surprised to hear that Mr. M. J. Coldwell had quoted Mr. Thorn as to the inside discussions we had whilst deciding which would be our proper course to pursue as elected representatives.
My recollection of these discussions is to the effect that-and we Independents and Progressives were all agreed-the Liberal government at that date was to be defeated in the house on the first vote taken. This was the policy which we had been elected upon, and we were duty bound to act accordingly.
We undertook to listen to the advice of all those parties more or less interested, or thought they were interested in our behalf, but when it came down to the method of decisive action to be taken, it was only natural that we assumed this responsibility amongst ourselves rather than being influenced by any outside parties.
I have no recollection during all the time that I have known you-namely, some thirty years-of your ever having received a "dressing down" and remaining quiet thereafter. My impression was always that the greater the "dressing down," the greater retaliation undertaken. For that reason I cannot help but think that Mr. Thorn-or whoever made the statement-was in error.
Sorry you are working so hard. Hope it soon eases off for you. Am working pretty hard myself, but will soon be off for my annual holiday. We are starting out for the west coast, and then south. Not sure just where we will stop for the winter. Best wishes and take care of yourself. Am feeling good myself but need a long rest.
Yours sincerely,
R. Stipe, M.D.
Creelman, October 16, 1949
A. C. Stewart, Esq., K.C., M.P.,
House of Commons,
Ottawa.
Dear A. C.:
Your letter received, and I may say that my memory is none too good for events of far more recent date than those referred to in your letter. However, as I recollect, paragraphs 3 and 4 are about as it happened. I don't remember any "calling down" that you got; for the rest I couldn't say.
With regard to the charge that you were responsible for the wreck of the Conservative party, that is something that shouldn't bother you too much in your present position.
1344	HOUSE OF COMMONS
Prairie Transmission Lines
Well, how are your wife and family? What are the boys doing? They were great little scrappers. I am enjoying good health, and wife and seven of a family all well and doing well.
Glad to hear from you again.
Yours truly,
S. Homer


Mr. Speaker:: May I point out that a point of order should be raised at the time the irregularity complained of is taking place. We have been discussing whether or not the hon. member had unanimous consent to do something which took place about fifteen minutes ago. If the point of order had been raised at that time it would have been much easier for the Speaker to decide whether the hon. member had unanimous consent. I mention this so that in future we shall not have this difficulty. I repeat that the point of order should be raised at the time objection is raised, and not afterward. See Beau-chesne, third edition, paragraph 261.


Stanley Howard Knowles: On a question of privilege, may I say that I agree fully with what Your Honour has said, but the difficulty was that it was uncertain whether the hon. member was asking to table the documents or to have them placed on Hansard. We could not tell because they were being carried back and forth between the table of the house and the Hansard desk.


Mr. Speaker:: The point of order could have been taken at that time.


Stanley Howard Knowles: I agree.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.


Mr. W. M. Benidickson (Kenora-Rainy River) moved: the second reading of Bill No. 119, to incorporate Prairie Transmission Lines Limited.


George Alexander Cruickshank: Explain, please.


William Moore Benidickson: In moving second reading of the bill, I think some explanation should be given to the house. Most hon. members who were here in the last parliament will recall that the house took certain action with respect to the many companies that were coming forward with plans for the development of the greatly expanding oil industry in Alberta. At the last session the house passed the Pipe Lines Act. This laid down the principle that any company desirous of having an interprovincial or international
IMr. Stewart (Yorkton.) ]
pipe line would be obliged to follow. Hon. members will recall that it was laid down, as far as this parliament was concerned, that jurisdiction in that respect would be given to the Board of Transport Commissioners for Canada.
At the last session of parliament several bills incorporating companies under the provisions of the Pipe Lines Act were passed. Some of those were for the transmission of oil and some for the transmission of natural gas. The terms of the present bill are almost identical with those of a bill sponsored at the last session by the hon. member for Fraser Valley (Mr. Cruickshank), namely, Westcoast Transmission Company Limited. Those who were members of the house at that time will recall that considerable concessions were given to the sponsor of the bill and to those associated with the company during the last stages of that session, in that the rules of the house were waived for its rapid passage. I want to point out that the powers requested in the bill of which I am now moving second reading, namely, Prairie Transmission Lines Limited, are identical with the powers asked for in the other bill I have mentioned.
I wish to make it clear that the passing of this bill does not in any way establish routes for the transmission lines for this company. As I say, as far as federal jurisdiction is concerned, under the direction of this parliament it was ordered in the last session that routes must be decided upon by the board of transport commissioners. I think hon. members are also aware that public interest is additionally protected in that the province of Alberta has established most effective control now of its natural resources in the form of oil and natural gas.
In the light of developments in that province, the Alberta government last year passed an important and effective act entitled "An Act to Provide for the Preservation, Conservation and Effective Utilization of the Gas Resources of the Province". I am not going to go into it in detail because I imagine that, if the present bill is proceeded with and we are able to examine the petitioners in one of our committees, hon. members of that committee will want to give the Alberta act considerable attention. I may say in passing that the Alberta government has the most direct control of the export of oil or natural gas from that province.
If we are to take the precedent of the case of the Interprovincial Pipe Line Company, the board of transport commissioners have taken the stand that, before anybody can come before it and secure authority under the Pipe Lines Act, he must produce evidence that he has satisfied the petroleum and natural gas conservation board of Alberta, and that

that board has satisfied itself that there is a surplus of gas in the province for export and has given authority to the corporation to export gas therefrom. In that connection I should like to read one of the sections of the Alberta act which I think will indicate to hon. members the effective control that has been established, and quite properly so, in that province. Subsection 2 of section 7 of the Alberta act reads:
The board shall not grant a permit for the removal of any gas from the province unless such gas is, in the opinion of the board, surplus to the present and future needs of the people of the province.
In addition, hon. members are probably aware that a further public control is established at the dominion level in that any person desiring to deal in oil or natural gas in an interprovincial or international way must obtain from the Department of Trade and Commerce another permit under the Electricity and Fluid Exportation Act. This is an additional public control. Therefore I say all that is sought in the bill is the right of this group to have corporate status, which this parliament has said they must have by act of parliament, and which is required before they can go to the Alberta board for the right to export and in turn go to the Board of Transport Commissioners for Canada.
I should like to inform the house that the bill has nothing to do with routes. There is nothing in it that establishes a route. I am advised by the group of Canadians who are associated with this company that they are most anxious to emphasize in the first place the maintenance of ownership of the project in Canada, and in the second place that they are prepared to do whatever it is ordered they shall do by either the public body of Alberta or the public body of the dominion -the board of transport commissioners, as far as the route is concerned. The incorporators are anxious to get into this line of business. Before they can do so, parliament has said that they must have corporate status, and that is all that is being asked.
As further evidence that there is no attempt in this measure to interfere with the desires and the rights of the province of Alberta, where these resources lie, I should like to place on the record a telegram that was sent to the premier of Alberta, when a similar bill was being considered in the other place. This telegram was sent by Senator Turgeon on October 17 to Premier Manning of Alberta, and reads as follows:
I should be glad to have answers to following questions as sponsor of the Alberta Natural Gas Company bill asking for charter enabling company to apply to board of transport commissioners, also the government of Alberta and the government of Canada for authority to export gas from Alberta to Vancouver, British Columbia and other parts of
Prairie Transmission Lines Canada and to the United States. Question No. 1: Is the government of Alberta opposed to the incorporation by the parliament of Canada under provisions of the Pipe Lines Act of the Alberta Natural Gas Company or any other bona fide company seeking power to build a pipe line under the Pipe Lines Act? The answer to this question would be based on the assumption that the ultimate intention of such company, after receiving due federal and provincial authorization, is to supply natural gas from Alberta to consumers in British Columbia, and any surplus supply would go to consumers in the United States Pacific northwest. Question No. 2: Has the Alberta government decided to prohibit the export of natural gas from any particular area or sections of the province of Alberta? Question No. 3: What is the general policy of your government in regard to export of gas from Alberta? I would greatly appreciate receiving reply today Monday.
Premier Manning replied on October 17 as follows:
Replying to your telegram October seventeenth, the following are the answers to the questions as enumerated in your wire. Answer to question No. 1: The Alberta government is not opposed to the incorporation of the Alberta Natural Gas Company or any other bona fide company under provisions of Pipe Lines Act, but on the contrary, feels very strongly that no bona fide company should be refused incorporation in that refusal would deprive the province of its right to deal with any or all legitimate companies interested in exporting gas and would restrict such dealings to those particular companies favoured by parliament for incorporation. Answer to question number two, the Alberta government has not decided to prohibit the export of gas from any particular area of the province but has announced that it will not approve the export of any gas until fully satisfied that there are sufficient available reserves to meet the present and future domestic and industrial requirements of Alberta. The discovery of new reserves and or integration of present fields could completely change the prevailing situation in any particular area. Answer to question number three, the policy of the Alberta government respecting the export of natural gas is threefold, first to prohibit any export until fully satisfied that there are sufficient available reserves to meet Alberta's present and future domestic and industrial requirements; second, when satisfied that surplus exists over and above these requirements sufficient to justify export under sound conservation and proration practices the government will approve the export of such surplus with each application being considered on its own merits and in the light of all prevailing factors; third, it will be a condition of any export permit that Canadian requirements must be given first priority.
I read this into the record to assure hon. members that the public interest is being protected at the provincial level in Alberta. What is required here is simply the granting to this company of a right similar to that which has been given to other companies, to go before the Alberta board and find out when they and others will receive attention for the request to export gas and oil from that province.
If we were to follow the procedure of last session, a bill of this type would be referred to the committee on railways, canals and telegraph lines. It would be my hope that after second reading that procedure would be followed now. At that time the officers of
1346	HOUSE OF
Prairie Transmission Lines the company, including its technical advisers, engineers and the like, could be examined by the members of this house. They would be in a position to give any details connected with the company's plan.
The point I wish to emphasize is that this parliament has already authorized certain companies to proceed to corporate status in order to do the same thing this company proposes to do. I say I think it would be contrary to the public interest if there were any tendency to close off the granting of rights to companies such as those granted required corporate status in the late stages of the last parliament, leaving those few companies in the position of holding a monopoly. That would be avoided, Mr. Manning says, by giving the greatest number of companies the opportunity of presenting their proposals to the conservation board in Alberta. That board, together with the board of transport commissioners and the officials of the Department of Trade and Commerce, acting under the Electricity and Fluid Exportation Act, could then decide what was in the public interest as between the various companies who might have schemes for the development of these important resources in the province of Alberta.


George Alexander Cruickshank: Might I ask the hon. member a question? I congratulate him on his very able presentation of a poor cause. The hon. member said that the bill I happened to have the privilege of sponsoring last year was similar to his bill. It was the only bill before the parliament of Canada for an all-Canadian route, and I should like him to tell me where the similarity is in the two bills.


William Moore Benidickson: In answer to the hon. member for Fraser Valley (Mr. Cruickshank), in the section of the bill that outlines the authority the company is seeking from this parliament, and which, in the case of the Westcoast Transmission Company bill sponsored by my learned friend, is section 6, and with respect to the bill I am sponsoring is also section 6, the words are identical. Both sections include the authority "to have pipe lines; to sell, convey or otherwise dispose of and turn to account, any and all interprovincial or international pipe lines."
I would also advise my hon. friend from Fraser Valley that shortly after the bill he sponsored was passed in this house, on May 11, 1949, an application was filed with the board of transport commissioners by the Westcoast Transmission Company, and on a map they indicated their desire for authority to take gas and oil from Edmonton to Macleod and down to the border. There was an extension shown on the map filed with that application which would indicate the
iMr. Benidickson.]

company had some further plans with respect to the United States. The board of transport commissioners, of course, only has jurisdiction with respect to the Canadian territory.


George Alexander Cruickshank: I appreciate very much the honour my friend accorded me when he called me his "learned friend." I would not go quite that far. There are one or two questions I should like to ask the hon. member. Are the directors of the company now being sponsored, the Prairie Transmission Lines Limited, citizens either of the province of Alberta which is going to supply this gas or the province of British Columbia which will derive the benefit of it?


William Moore Benidickson: It is rather difficult for me to answer questions at this stage of the bill. I believe the member for Fraser Valley could get this information more properly either when we reach committee of the whole or in a standing committee to which the bill might be referred. I may tell my hon. friend, however, that there are some very well known and highly thought of persons in the province of Alberta who are interested in this bill. On the spur of the moment, I can think of Mr. Bruce Smith, K.C.; Mr. Walter Sprague; Mr. Murray Montague and Mr. Hales Ross, all of Edmonton, as Alberta persons interested in this bill.


George Alexander Cruickshank: I did not question the integrity-


Mr. Wylie:: This is not the question.


George Alexander Cruickshank: I am just doing a little questioning.


Mr. Speaker:: Order. The hon. member may ask questions of a member who previously had the floor, with the consent of that member. I understood the hon. member to say that he thought the questions should be asked in committee. If he does not agree to answer the questions now, it is out of order to ask them.


George Alexander Cruickshank: Am I to understand that the member sponsoring this bill is not prepared to answer questions concerning a nonCanadian route as compared with an allCanadian route, now or at any time?


William Moore Benidickson: I am only too pleased to abide by the rules or, with the consent of the house, to answer my hon. friend now. I must remind him, of course, that when he sponsored the Westcoast Transmission bill to which he has referred he made no word of explanation to the house as to the purpose of the bill nor was he asked any questions.


William Duncan McKay Wylie: I should like to say a few words about this bill. As you know, the city of Medicine Hat is vitally

interested in the natural gas in this country. I am becoming just a little confused by all the bills that are being presented to this house. At the last session of parliament a bill was passed concerning the Westcoast Transmission Company. Last week we discussed another bill concerning the Alberta Natural Gas Company. Tonight there is a bill to incorporate the Prairie Transmission Lines Limited. Just where we are going to get off at, I do not know. I agree with the telegram that was read by the hon. member for Kenora-Rainy River (Mr. Benidickson). I agree with the reply from the premier of our province. I was going to put it on Hansard tonight if the hon. member had not done so. I feel, however, that this is something that should receive serious consideration; I think perhaps it should receive more consideration than a bill coming into this house every week.
To review part of the history of natural gas in Alberta, may I say this. The first gas well in Medicine Hat was drilled in 1883. I believe that Medicine Hat, in the southern part of the province, was the first city in Alberta to discover gas. I am sure some hon. member will correct me if I am wrong in that statement, but I believe that I am right. The discovery of gas in Medicine Hat was unique. It may be recalled to many hon. members here that a portion of the south Saskatchewan river never froze up during any winter, and that when someone went up to this opening in the river and lit a match to light a cigarette, it went into flames. I may say further that in the early days of Medicine Hat and the south country many people, when they went on a picnic, took along a shovel, dug into the ground about four or five feet, lit a match, and they had natural gas with which to cook their meals.
Today the situation is changed. We in the southeastern and southern part of the province believe that we have sufficient gas for our heating, our cooking and our industries for quite a number of years. But it must also be remembered that at the present time Medicine Hat is drilling wells nine miles from the city limits. What does that mean? It means only one thing, Mr. Speaker. It means that the pressure in our gas wells is being reduced. It means that the residents of Medicine Hat must pay more in the way of taxes in order to get, as an hon member said the other night, our cheap fuel. That goes to show that we must be extremely careful about the exportation of any gas from the southern part of our province.
It is true that in the northern part of Alberta we have many fields that are not yet explored. But it must also be remembered that, before any gas line goes through any part of the United States to heat the city of
Prairie Transmission Lines Vancouver, we must be prepared to look after our own heating needs and the present and future needs of our industries.
In the city of Medicine Hat today we have only about four lights burning all day long. No doubt many members in this house will recall articles they have read to the effect that Medicine Hat was the only city in Canada which had lights burning twenty-four hours of the day. The reason those lights were left on all day was that it cost too much to put them out; it was cheaper to let them burn. The only lights we have burning all day in Medicine Hat are about three at the C.P.R. station. I am speaking about natural gas lights. All the others have been replaced by electricity. Any time that any dignitary came to our city, the first thing we thought of was blowing off a gas well, in order to show him what we had in the city of Medicine Hat. Under the gas conservation board, which I certainly believe in and which I think we should have had many years ago, there is no more blowing off of gas wells. You may recall, Mr. Speaker, the flares that we had in Turner valley. When I was with the Department of Agriculture years ago, I can remember sleeping on top of the hill at Cochrane, northwest of Calgary, which is well known to the hon., member for Calgary West (Mr. Smith). You could see that flare for miles. We now have no more flares. It must also be remembered that the burning of those flares reduced our oil production. It must be remembered that maybe ninety per cent of the possible oil production of Turner valley is still in the Turner valley field owing to the waste of gas in years gone by. That is rather hard to believe.
I might mention Bow Island, a small town between Lethbridge and Medicine Hat. In the early days Bow Island had an abundance of gas. What is happening at the present time in the Bow Island field? That field is being repressured from the Turner valley field. Those are things that many people do not realize but the citizens of that area realize them. We in a city like Medicine Hat certainly realize them, because we depend on the production of natural gas for our livelihood. If it were not for natural gas in Medicine Hat where would Medicine Hat be? An hon. gentleman says that we would be in the dark. I say quite definitely that is so, but may I say to that hon. gentleman and to every other hon. member that if it were not for natural gas there would not be any city of Medicine Hat. We have no farming community around Medicine Hat sufficiently large to support a city of 15,000 or 16,000 people. There is no need for me to go into that, because I have spoken on irrigation every

Prairie Transmission Lines time I have risen in the house, and I do not know why I am not speaking on irrigation now. However, this is a natural gas bill.


Stanley Howard Knowles: It is a pipe line; you can run water through it.


William Duncan McKay Wylie: It is true, as the hon. member says, that it is a pipe line and we might run water through it. I wish we had some pipes to run some water through them. I hope that the Minister of Agriculture (Mr. Gardiner), in his sojourn in the west during the last two weeks, has seen fit to bring water through some of these pipe lines.
Getting back to natural gas, may I say that we in that south country believe we should protect the industries that we have in southern Alberta. We believe that we should protect the industries that we expect to have in the near future. Before we ship natural gas outside Canada we must supply our own people. Whether this company intends to go beyond the borders of Canada I do not know. I do not believe it was stated by the hon. member who introduced the bill. When these bills are introduced we should know whether the gas is to be exported beyond the borders of our own country, or whether it is to stay within our borders. That is one statement that should be made when the bills are introduced. If we have an abundance of gas we should use it in this country for the benefit of our own citizens. When we have a surplus of gas we might discuss exporting it. Until we are in a position to do that, we should keep it inside the borders of this country.


Mr. Pouliot:: How can you establish that you have a surplus of gas?


William Duncan McKay Wylie: I am glad that the hon. member for Temiscouata brought up that question. I was just about to deal with it but I did not know how to approach it. Now that the hon. member has asked the question may I say I believe, and everyone in Alberta believes, that if we have a surplus of natural gas we should export it. Up to the present time we have no experts to tell us that we shall have a surplus of gas. Until that is done we should look after our own industries and our own requirements first. In saying that, I do not mean that we should keep it in Alberta. The hon. member for Comox-Alberni (Mr. Gibson) is just a little bit jealous of our natural gas.


Jean-François Pouliot: Give him the surplus you have.


William Duncan McKay Wylie: No doubt, Mr. Speaker, anyone who is in the lumber business and produces sawdust for heating would want to protect the industry. May I say to the hon. member that if he ever tried natural gas he would never go back to sawdust.

Statements are made in the house that we in the west are enjoying cheap natural gas at the expense of the rest of Canada. I do not agree entirely with that statement. It is true that we are enjoying natural gas at a cheap rate. I say that we are very fortunate to be living in Alberta.


John Lambert Gibson: And that they exported the hon. member.


William Duncan McKay Wylie: In spite of the remarks
of the hon. member for Comox-Alberni we are glad to live in Alberta and that he lives in British Columbia. What is the situation in the south country, not only in Medicine Hat but in Lethbridge and Calgary?-I might say even in Red Deer. I could go further north than that. I could go to Edmonton. I could cover all the small towns east of Edmonton down to Camrose from which my good friend comes and perhaps down to Vegreville. They are all supplied with natural gas, not the kind of gas hon. members are thinking of. Natural gas is one product that we in Alberta must protect.


Jean-François Pouliot: Will the hon. member please give me a definition of natural gas? Tell us the quantity and give us an idea of the reserves.


Stanley Howard Knowles: Definition or exhibition?


Jean-François Pouliot: The number of gallons that could be used in future years.


Some hon. Members:: Gallons?


William Duncan McKay Wylie: I have no better definition of natural gas than the hon. member for Temiscouata.


Some hon. Members:: Oh, oh.


Jean-François Pouliot: I am not talking about it; I am asking for information.


William Duncan McKay Wylie: You have got the information. May I say that all we need to do in this south country, in the city of Medicine Hat or the adjoining country, is to drill a well in the ground about 1,000 feet deep and we have a gas well. Every once in a while if you wish to make a blow-off, just ask the hon. member for Temiscouata (Mr. Pouliot).
But, seriously, getting back to this pipe line bill-


Jean-François Pouliot: Are you for or against the bill?


William Duncan McKay Wylie: I am for the bill. One thing I do believe in is this: I believe in private enterprise, right to its roots. Why should any company have a monopoly on the export of gas from our wonderful province? If any hon. members want to introduce a bill to incorporate a company, that is certainly their privilege. I would not object to it; but I do

Prairie Transmission Lines
object to the export of natural gas from Canada until everyone in the country has been supplied with it.


John Lambert Gibson: That is what your premier said.


William Duncan McKay Wylie: We must look after the future requirements of our country. So that in answer to my hon. friend-


Jean-François Pouliot: Which one?


William Duncan McKay Wylie: The hon. member for Temis-couata. He has asked if I am opposed to this bill, and I say that I am not. I believe we should have two or three companies in the field, because competition is what we all want, I hope.


Mr. Maclnnis:: What a hope!


William Duncan McKay Wylie: We certainly do not want to permit any one company to have a monopoly. About this bill I have only one thing to say and it is this-


An hon. Member:: Nine o'clock.


William Duncan McKay Wylie: I can talk till nine o'clock if you want me to.


George Alexander Cruickshank: You are doing a good job; keep going.


Mr. Speaker:: Order.


William Duncan McKay Wylie: I do not oppose the bill.


Some hon. Members:: Oh, oh.


William Duncan McKay Wylie: You may laugh if you like; you may think that because I am speaking I am opposing it. In that you are wrong. But I believe in competition, and I am trying to tell the house that we have a situation we must protect. The situation in Alberta today is worth the serious consideration of the House of Commons and the other place.
The fact that some of these bills may pass the other place is no reason why they should pass here without consideration. We must look after the needs of our own people, and must not export natural gas to any other country until Canadian requirements are met. When I refer to Canadian requirements I do not mean the east or the west: I mean both.
I will support the bill-


George Alexander Cruickshank: Why?


William Duncan McKay Wylie: Why not?


John Lambert Gibson: Let's toss a coin.


William Duncan McKay Wylie: May I say to the hon. member for Fraser Valley (Mr. Cruickshank), who is supposed to be a good Liberal-


Gordon Knapman Fraser: "Supposed" to be?


William Duncan McKay Wylie: Just how good, I don't know; but he believes in competition. I do not believe in monopoly, and it is for that reason I give my support to the bill-and to the bill which was up last week. I propose, too, to support the bill concerning the Westcoast Transmission Company.


Mr. Speaker:: Order. There is only one bill before the house.


William Duncan McKay Wylie: Those are the three bills I am glad to support. I am sorry to have transgressed the rule, and am glad Your Honour has corrected me. My support is given because I believe in competition. If we gave only one company the right to transport our gas we do not know what the poor people at the end of the line would have to pay for it, while we in Alberta would be getting cheap gas.


George Alexander Cruickshank: Would you believe in an all-Canadian route?


William Duncan McKay Wylie: Yes, I do.


George Alexander Cruickshank: Why?


William Duncan McKay Wylie: Why not?


Stanley Howard Knowles: The effects of this gas are becoming apparent.


George Alexander Cruickshank: I want only ten minutes of explanation.


William Duncan McKay Wylie: You will have your ten minutes when I have finished.


George Alexander Cruickshank: Keep going.


William Duncan McKay Wylie: But I am glad the hon. member for Fraser Valley has brought up that point, because I do support an all-Canadian route.


George Alexander Cruickshank: Why?


William Duncan McKay Wylie: If you had listened to my speech you would have known why, without asking the question. I have always supported an all-Canadian route for any pipe line. I have said more than once that I believe our own people should be supplied first with natural gas, and that only the surplus should be exported. I am sure the hon. member must have heard that, and I am surprised at his asking the question. I hope the hon. member will support me in the contention that no natural gas should leave Alberta or Canada until we are satisfied that our present and future requirements are filled.


Thomas Langton Church: Mr. Speaker, after the very fine speech of the hon. member who has just taken his seat there remains very little for me to say. Governments begin to die the moment they are born, and this bill is a demonstration of that principle.
In the debate on second reading one is not permitted to discuss the various sections of a

Prairie Transmission Lines bill but is limited to the principle. It is difficult to limit oneself in that way. No village council would operate in this haphazard fashion in respect of a natural resource belonging to that village. Fortunately the position indicated here did not obtain in connection with the power development in the Niagara district. A section was inserted in the municipal act requiring a vote of the people.
I am surprised to see this high court of parliament attempting to pass this bill tonight. Only a few days ago we had an important discussion concerning our forests. We have parted with our natural resources in a frivolous manner. I am surprised that this bill does not take over the heavens above, the earth below and the waters under the earth. Nothing seems to be left out of the statute. There is general legislation known as the Pipe Lines Act, but in my opinion it should be called the pipe dream act. That would be a far better title for it because that is just what it is.
How does it come about that this particular bill was introduced in another place without any discussion? There were only five or six words said in the other place on this particular bill. This bill seeks to give away the natural resources of this country. It strikes me as being funny that a minister of the crown or an hon. member who is going to be a minister should introduce this particular form of bill.
We cannot refer to the sections of the bill on the motion for second reading, but I must say that this bill is different from any I have ever seen and I have been a member of this house for some few years. The bill seeks to incorporate the Alberta Natural Gas Company, but it is not limited to that. It deals with 75 to 100 other matters. I am precluded from mentioning individual sections, but one section of this bill seeks to set this company outside the provisions of the Companies Act. An attempt is being made to make this a special act. It is proposed that the company shall not be subject to the provisions of sections 158, 163, 180 and 190 of part III of the Companies Act.
They are seeking by a private bill to do something which is the most ridiculous proposition I have ever heard put forth in this house of parliament. In addition they are trying to take this company out of the Companies Act and many other statutes. Two of the incorporators of the company live in Ottawa, and why not? The third incorporator lives in Wilmington, Delaware. Ottawa is a good place for an incorporator to live in who is seeking almost everything.


William Moore Benidickson: On a point of order, the hon. member is referring to a bill which was 

introduced last Friday evening by another member, a bill to incorporate Alberta Natural Gas Company. From what I have heard of the hon. gentleman's remarks, they do not apply in any way to the bill that I am introducing.


George Alexander Cruickshank: I think the hon. member has been referring to both bills.


Thomas Langton Church: The hon. member represents a northern Ontario riding, but let me tell him that I remember back in 1909 and 1910 when Sir James Whitney made a great mistake in connection with northern Ontario when he refused to electrify the Temiskaming and Northern Ontario railroad. If that had been done, instead of power in that part of the country costing $60 per horsepower, it would have been available at much cheaper rates. The hon. member who has interrupted me is a very nice young gentleman; he is quite popular with his colleagues. If that great mistake had not been made the people in his part of the country would have had the joys of living instead of the different companies being owned holus-bolus by corporations in Montreal.
I asked a responsible minister if this bill was going to a committee, and he said it was. However, it went to a committee in another place and there was practically no discussion. The bill was read the third time and there were only nine or ten words of discussion on it. I am surprised at a bill being offered to this house that seeks to give away the natural resources of this country. There are some other matters I should like to refer to later and as it is nine o'clock I should like to move the adjournment of the debate.


Mr. Speaker:: The hour for private and public bills having expired, the house will resume the business interrupted at six o'clock.



THE BUDGET


[Stage Direction]
The house resumed consideration of the motion of Hon. Douglas Abbott (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Rowe, and the amendment to the amendment of Mr. Thatcher.
Mr. Victor Quelch (Acadia):: Mr. Speaker, I intend to devote most of my time to a discussion of the international situation referred to by the Minister of Finance (Mr. Abbott) in his budget speech on Thursday, October 20. However, I should like first to comment briefly on the internal situation.. A nation

cannot hope to solve its international problems unless it first sets its own house in order, that is unless it first establishes a balanced economy in which the purchasing power of the people is maintained at a level sufficiently high to buy the total production of the country. Then and only then will a nation be willing to accept freely imports from other nations in exchange for its exports.
Unfortunately that has not been the situation in the past. Invariably nations have endeavoured to maintain favourable balances of trade in order to maintain a high level of employment within the country. In other words, what they have really been trying to do is to lay their unemployment problems on the doorsteps of other nations. That has created a great deal of international friction.
That was the situation in Canada and in many other highly industrialized nations prior to the war. The war created a tremendous market for practically everything that could be produced, and we had a sellers' market after the war, owing to the great backlog of demand for both capital and consumer goods. Money remained plentiful in the post-war years largely because there was an accumulation of war savings, large sums of money were being paid out for reconversion, and large foreign credits were being granted.
But today we find the situation has changed considerably for the reason that the accumulation of savings, in so far as the people in the low-income groups are concerned, have largely been spent, that the reconversion program has been pretty well completed, and that foreign credits are largely exhausted. Marshall aid ends in 1952 and we find that the nations of Europe are doing everything in their power to establish balanced economies so that when Marshall aid ends they will be in position to pay for the imports they require.
In his speech the Minister of Finance (Mr. Abbott) referred to the high level of income, production and employment, but at the same time he warned that we cannot expect that high level to continue in the future. He warned that owing to the decline in international trade the high level of activity might not be maintained. The Minister of Trade and Commerce (Mr. Howe), speaking before the annual meeting of the exporters association at Montreal on he 20th of October, issued a similar warning Both the Minister of Finance and the Minister of Trade and Commerce have pointed out that for that reason the government have measures under consideration for the purpose of maintaining a high level of economic activity in the country. We in this group agree it is most necessary that the government keep in mind and have ready a program for the purpose of picking up any slack, but we are afraid that the 45781-86
The Budget-Mr. Quelch program the government has in mind may not be adequate for the purpose of maintaining the purchasing power of the people at a level sufficiently high to buy the total production of the country and the imports that are brought in in exchange for exports. If the program is inadequate, then a recession will be inevitable.
I know that many people oppose the idea of the federal government going ahead with a program for the purpose of maintaining the purchasing power of the people, whether it be by national projects <pr other means. The reason they oppose the program is thaT they are afraid such a program will mean an increase in taxation. Obviously, if the purpose of the government program is to maintain the purchasing power of the people at a high level, that program cannot be financed in its entirety by taxation because an increase in taxation would reduce purchasing power and defeat the very thing that the government was trying to accomplish. For the same reason a program of that kind could not be financed by borrowing the savings of the people. Therefore we are interested in seeing that, when a program for the purpose of maintaining the purchasing power of the people is introduced, it will be financed in part at least by monetary expansion. It is interesting to note that, when the governor of the Bank of Canada made a broadcast on post-war finance on the program "The Shape of Things to Come", he frankly admitted that if a recession were to develop after the war it might be necessary to finance government projects in part at least by monetary expansion. The only point on which we would differ with the governor of the Bank of Canada would be that, if the government found it necessary to indulge in monetary expansion, the government should use national money, debt-free, instead of borrowing from the chartered banks.
I am not going to expand that point because the hon. member for Lethbridge (Mr. Black-more) dealt with it very fully the other night. I want to turn to the international picture that the minister drew when he spoke in the house on the budget. I think it is most unfortunate that the Minister of Finance has created the impression in the past that the responsibility for solving the dollar crisis rests predominantly on Great Britain and the sterling area. In my opinion, nothing could be further from the truth. I think that the Monetary Times in their September issue dealt with the matter very effectively on page 10, where they said:
If there is less than a complete realization of the jeopardy in which our overseas export trade stands today, the statesmen at Ottawa must assume some of the blame. Their utterances on the subject in recent months have often been less than candid.
1352	HOUSE OF
The Budget-Mr. Quelch Finance Minister Abbott's statement, following his return from London, that the dollar problem "is the problem of the United Kingdom and the other sterling countries", was more likely to lull than awaken Canadians to the fact that it affects them too. There appears to be an impression prevalent that Britain and the other countries in the sterling area must buy in North America or die. Such an assumption overlooks substantial evidence that Great Britain and her sterling associates can achieve viability by trading amongst themselves with very little dependence on North American produce. The bilateral deals which Britain has made with Australia and Argentina is positive proof of the trend in that direction. It is not wide of the mark to conclude that Canada would find it more embarrassing to lose its markets in the sterling area than it would be for other countries to forego our natural and manufactured products. It is foolhardy for Canadians to look on the dollar shortage as entirely the problem of the British and the commonwealth countries using sterling. The problem is as much ours as theirs and if this country is to avoid suffering grievously in loss of markets Canadians will have to put forth their best efforts to assist in finding a solution.
I think it is unfortunate that the government did not realize the truth of that statement in 1944 and 1945 when we were discussing port-war international trade problems. At that time the government insisted that the main responsibility for establishing a balance must rest with the debtor nation. Along with the United States of America they put heavy pressure upon Great Britain to sign international agreements which they must have known that Great Britain would never be able to comply with. Consequently step by step we have had to release Great Britain from a number of its commitments. I would say that unquestionably the main responsibility for solving the problem rests with the United States of America for the simple reason that the United States of America is the great creditor nation of the world. Unfortunately the pre-war record of the United States in this regard has not been a good one.
That was brought out very fully in 1945 in the evidence before the banking and commerce committee of the house at the time we were discussing the Bretton Woods agreement. Again quoting from the Monetary Times, page 14 of the August issue, we find a clear picture of the role that the United States has played and is playing as a creditor nation. I quote:
While Germany and Japan for the moment are prostrate, Britain is no better off since the United States has come forward to dominate the world trading scene. Larger, equally vigorous, and with infinitely superior techniques, America until very recently has been completely selfish in search of world trade, often completely ruthless. In her own way, she also is determined to rule by establishing a system which all others must adopt whether they like it or not.
I would say that was the very basis of the Bretton Woods agreement, and to a lesser
	|

degree of the Geneva trade agreement. Mr. Rasminsky, when he appeared as a witness before the banking and commerce committee in 1945, frankly admitted that the record of the United States as a creditor nation in the past had not been one to create confidence, but he stated that he believed that the United States since then had a change of heart. I would point out that it will require far more than a change of heart. It will require a fundamental change in policy; it will require a policy which recognizes the fact that international trade is an exchange of goods and services between nations on a basis of mutual advantage, and not merely an exchange of goods for money.


John Horne Blackmore: It will require a change of head as well as a change of heart.


Victor Quelch: One of our main reasons for opposing the Bretton Woods agreement was that it had a definite pro creditor bias. Whilst it imposed penalties upon debtor nations unable to balance their payments with the fund, it placed practically no pressure whatsoever upon creditor nations. At that time we were told, so far as that was concerned, it would be looked after later on when international trade agreements were signed. We did have the Geneva trade agreement later. There may be some advantages contained in that agreement but, on the other hand, it embodies a policy known as a policy of nondiscrimination which, in reality, is a very vicious policy of discrimination against an importing nation, especially a debtor nation. It definitely restricts that nation's right to determine its own source of supply.
I realize that it is often argued that nations did not have to sign the Bretton Woods agreement or the Geneva trade agreement if they did not wish to do so. They signed them voluntarily. On the other hand, let us not forget that those agreements were made the price that European nations had to pay in order to obtain post-war assistance. For instance, in order to obtain the benefits of the United States loan, Great Britain had to agree to convertibility of sterling in 1947. She had to agree to a policy of non-discrimination. I am satisfied that the people of Great Britain knew quite well they could not make convertibility work in 1947. I am certain also that the people of the United States knew Great Britain would not be able to do it.
What happened? The pound was made convertible in 1947 and in a few weeks Britain was forced off convertibility. In the meantime, serious damage had been done to her trade. So far as non-discrimination is concerned, a policy of that kind is bound to have

a restrictive effect upon trade. The London Economist puts it very clearly in the issue of August 7, 1949.
So long as dollars are a hard currency, some degree of discrimination is inevitable. To insist on complete non-discrimination is, in these circumstances, to insist that all commercial exchanges shall proceed at the pace of the slowest.
I think that is self-explanatory. If a nation has a favourable balance of trade with one nation and an unfavourable balance of trade with another nation, the logical thing for that nation to do is to restrict its imports from the nation with which it has the unfavourable balance and to expand its imports from that nation with which it has a favourable balance. Under the non-discrimination clause of the Geneva trade agreement, if that nation restricts its imports from one nation it is compelled to restrict those imports from all other nations, whether or not it has an unfavourable balance of trade. True, there are escape clauses but they expire within a year or two. The nations realize that and are doing everything in their power to get their trade balanced before that time comes.
Ever since the war this group has insisted that creditor nations must accept payment in goods. In the past we have criticized Canada's policy of demanding payment in dollars for exports to the sterling area instead of taking goods. We have warned that the result of the government's policy of insisting on payment in dollars from the sterling area was bound, in the future, to breed a policy of economic nationalism within the sterling area and a consequent loss of markets to Canada. It is interesting to note the extent to which that has already taken place. I have in my hand a copy of "Foreign Trade" dated August 27, 1949. On page 350, we find these words:
London, July 27, 1949:	Results of the policy of
substituting soft currency countries for dollar countries as sources of supply for imports into the United Kingdom are apparent from the trade returns for the first six months of the current calendar year. Typical Canadian products like oats, beef, poultry, apples, canned tomatoes, canned salmon, chilled and frozen fish and linseed oil have disappeared entirely from the list of imported commodities.
Note that practically all those commodities are agricultural ones.
The same article continues:
The same influences have reduced imports of flour, eggs (shell, liquid, and dried), bacon, sausage skins, asbestos, lumber, furs, mechanical pulp, seeds, rubber footwear, leather, chemicals, paperboard, kraft paper and refined copper.
There is a list of over twenty-five commodities. Then the writer points out a list of some eleven which have increased, but the reductions are many times greater than the increases.
45781-86i	!
The Budget-Mr. Quelch
Of course that situation, Mr. Speaker, was bound to develop. As long as Canada demands payment in dollars instead of being willing to accept imports, then Britain and the sterling area lacking dollars are, of course, compelled to get their imports from those countries that are willing to buy from them. In the same way, of course, either the United States will have to buy more from Canada or, on the other hand, we shall have to buy less from the United States.
I know it is argued that the United States cannot possibly consume its total production and therefore has to export more than it buys. There, again, I think the London Economist sets out that situation quite well in its issue of September 3, 1949.
If the U.S.A. insists on producing more than it consumes and investing less at home than it saves, then it should lend abroad until a higher level of consumption is attained at home.
I believe that is self-explanatory. Let me point this out, however, that foreign investment is not the long-term solution. It is only a temporary one. If you have a favourable balance of trade with a nation and you therefore carry on a large degree of foreign investment in that country, the time will come when you will actually have to accept more imports than you export in order to accept payment for the interest on your investment. The last stage, therefore, will be worse than the first. For this reason foreign investment cannot be looked upon as the solution to an unbalance of international payments.
Of course, Canada faces an entirely different situation from that of the United States. The United States has an extremely large over-all balance of payments. Last year, it was approximately six billion dollars. In a special report issued by ECA, I notice that since 1914 the United States has had a favourable balance of trade of over $108 billion. It has been the consistent practice of that country in the past to export more than she buys.
Canada is, of course, in an entirely different situation today. We only have a very small over-all balance. We have a large deficit with the United States and a large surplus with the sterling area. Apparently the government is at last beginning to realize that there is some truth in the principle affirmed by this group in the past, that Canada must be prepared to accept imports in exchange for exports instead of demanding dollars from the sterling area in order to pay our deficit to the United States. We must balance our trade unilaterally with the sterling area and unilaterally with the dollar area.
I believe the Minister of Trade and Commerce (Mr. Howe) has made that clear even though perhaps the Minister of Finance
1354	HOUSE OF
The Budget-Mr. Quelch (Mr. Abbott) does not recognize that fact. I say that, because of a speech delivered by the Minister of Trade and Commerce at the annual meeting of the exporters' association in Montreal on October 20. I quote from a report of his speech in the Montreal Gazette:
If Canada, without further loans, is to hold her current trade status with Britain after the termination of Marshall plan aid in 1952, then Canada must increase purchases from that country by an annual $365 million.
That is approximately the trade balance in Canada's favour. In the year ended last September, Canada bought from Britain $325 million worth of goods and sold $691 million.
At another point the same report reads as follows:
On the other hand, Canada's balance was adversely affected by trade with the U.S. While Canada shipped $1,550 million worth of goods in the same twelve-month period, she imported about $2 billion. The $450 million deficit was collected from the rest of the world through Marshall aid dollars.
"Obviously, our policy must be to export more to the U.S. or alternatively to buy less from that country."
He points out that in order to solve our difficulties with the sterling area we shall have to accept more imports from that area, and in order to solve our deficit with the United States we shall have to buy less from them or they will have to buy more from us. In other words, he is suggesting that we solve our balance of payments difficulties unilaterally with the sterling area and unilaterally with the dollar area; and that is the stand this group has always taken in the past.
In the past the government has always insisted on multilateral trade based upon the convertibility of currency. I notice that the hon. member for Dufferin-Simcoe (Mr. Rowe) and the hon. member for York West (Mr. Adamson) took that stand when they spoke on the budget the other day in this house. Let me point out that it is absolute nonsense to advocate the convertibility of currency until we have established a system of international trade that will ensure a balance of payments; because even if you had a balance of payments tomorrow and you decided to bring about convertibility of currency, how long could you remain on a basis of convertibility of currency if nations immediately, as a result of convertibility, insisted that other nations pay them in dollars instead of taking goods?
Unless we lay down a basis which would ensure a balance of international payments, I would say that you would not be able to have convertibility of currency for more than a few days; because just as soon as nations started to demand the convertibility of their foreign credits into dollars, you would force those nations off convertibility. How can
(Mr. Quelch.]


John Horne Blackmore: And get a great stranglehold on the world.
1356	HOUSE OF
The Budget-Mr. Quelch


Victor Quelch: I want to say a few words about the effect of devaluation on Canadian agriculture. It would appear that if Britain sells at prices existing prior to devaluation she will have to sell in Canada approximately 20 per cent more in order to get the same amount of dollars. Naturally then she will have fewer dollars to spend. If we in Canada sell farm products at the same price they will cost Britain approximately 20 per cent more, and in all probability have the effect of reducing our sales to Great Britain. If we, on the other hand, reduce our prices to meet sterling competition then our farmers will probably receive somewhere in the neighbourhood of 20 per cent less. Therefore, from the point of view of agriculture, it is not a very happy picture.
Of course I realize it may be argued that the farmers will receive 10 per cent more for the products exported to the United States of America; but, on the other hand, machinery imported from the United States of America, or machinery manufactured in Canada with high United States content will cost the farmers of this country considerably more.
Last week I received a letter from my local dealer to the effect that since devaluation the price of tractors has already gone up $185. That is going to be quite a serious increase in costs to the farmer without any guarantee that they are going to get any increase in prices to balance these increased costs. Therefore, in view of the uncertainty of the whole agricultural picture, the government should make known to hon. members at the earliest opportunity just what their stabilization program is. I recall that in the house the Minister of Agriculture (Mr. Gardiner) stated that as a result of government policies the farmers from 1942 to 1948 received less for their produce than they would otherwise have received. I say, as a direct result of government policy. That was the statement the Minister of Agriculture made in the house. He went on to say that that was being done in the name of stabilization. Since the government's stabilization program from 1942 to 1948 had the effect of keeping agricultural prices down, the farmers are interested in knowing whether they are going to be guaranteed the stabilization of agricultural prices in the future. The only legislation on the statute books today guaranteeing stabilization is the Agricultural Prices Support Act, and the Agricultural Prices Support Act expires on March 31, 1950. Therefore the farmers are justified in having an assertion from the government as to just what their stabilization program is to be in the future.


Some hon. members may say, "Well, you have forgotten the international wheat agreement." It is true we have that, but there is no very great guarantee behind the international wheat agreement so long as we have the unhappy international trade picture, because embodied in the international wheat agreement is a section which states that if any nation is unable to purchase its quota it can be relieved of the responsibility of buying it. The only reason that Britain is able to buy our wheat today is that ECA provides the dollars. If in the future Britain is not able to find dollars to buy our wheat then, under that section in the international wheat agreement, she can be relieved of the obligation to buy it and seek it from the Argentine or Australia or from some other countries.
Some hon. members may say, "Well, you have talked about the losses that the farmers have suffered. Do they amount to very much?" I have not time to go into the whole picture, but I shall just deal with one commodity to show the losses suffered by the farmers of western Canada in particular as the result of the government's stabilization program. I hold in my hand a return that was tabled in answer to questions asked by the hon. member for Battle River (Mr. Fair) on February 28 and October 3, 1949. This return shows the quantity of wheat sold to Great Britain, the quantity of class II wheat sold, and wheat sold to the Canadian consumer, and the prices at which that wheat was sold. I note from a computation made from these figures that the total losses suffered by farmers on wheat sold to Britain in the first three years of the British wheat agreement amount to $384,935,416. The total loss suffered by farmers as a result of subsidizing Canadian consumers during those years amounts to $123,661,952. Therefore the total losses suffered by farmers as a result of subsidizing the British and Canadian consumers during the first three years of the British wheat agreement amount to $508,597,368. That is just on wheat alone in the first three years of the British wheat agreement.


Mr. Deputy Speaker:: Order. I am sorry to interrupt the hon. member but his time has expired.


Some hon. Members:: Continue.


Victor Quelch: I shall conclude in a few words. Some hon. members argue that you cannot compute the losses on the British wheat agreement until the end of the fourth year, because there may be gains in the fourth year. The gains in the fourth year cannot be very great, because in the fourth year we have agreed to sell Britain 140 million bushels at $2 a bushel. During that

period wheat cannot fall below $1.68 a bushel because that is the floor price under the international wheat agreement. Suppose wheat fell to the floor, to $1.68, then we could not gain more than 32 cents a bushel. On 140 million bushels it would amount to $44.8 million. So that in the fourth year, if the price of wheat did fall down to $1.68, we would gain $44,800,000, which would mean that the net loss for the whole four years would be $463,797,368. But on the other hand there is a possibility that the price of wheat will not fall to $1.68. The price of class II wheat until very recently-perhaps it still is today-was $2.40 a bushel. Therefore instead of there being any gain in the fourth year there may be further losses, in which case the losses would be higher than $500 million.
In closing, Mr. Speaker, may I say I trust that the government will at a very early date give the house the assurance that the stabilization of agricultural prices is a permanent policy of the government for the future as well as for the present.


Mr. W. G. Blair (Lanark):: I wish to take the opportunity afforded by this debate on the budget to bring to the attention of this house a matter which vitally affects my constituency of Lanark, and which is a matter of importance to the whole of Canada. In my constituency there are eleven woollen textile mills. The effect of the devaluation of the British pound to date is that in some of these industries business is at a standstill, and the factories are now running on short time. These are days of high living costs, and it seems unfair to textile workers to be on a short week, or to be shut off night work, while those not affected by devaluation are working a full week. Customers of woollen textiles are not buying at the present time, and therefore there is not sufficient work to keep the mills running a full week. My interest in this matter is that of the representative of a constituency in which there are eleven textile mills manufacturing woollen textiles. It is a very important industry in Lanark.
I have no interest or stock in any industry of this type, and my concern is solely that of the representative of a constituency where I feel textile workers may be thrown out of work, and textile manufacturers will have difficulty in maintaining their business.
The mills in Lanark are mainly composite mills. They import wool at the same price as the English mills, and completely process the wool in their factories. Before devaluation Canadian woollen and worsted cloth mills had difficulty in competing with English prices. Even then Canadian mills were not able to run a full week. The production of
The Budget-Mr. Blair Canadian woollen and worsted cloth for the first six months of 1949 was about 10 per cent lower than in 1948.
This condition will now become worse, because since the depreciation of the currency British and foreign mills are in a better position to compete in the Canadian market. The only result of this can be lower production for Canadian mills and unemployment for Canadian textile workers.
I made the statement that Canadian production has been decreasing, and that imports are increasing. Great Britain had a very large share in this market in 1948. I give the house the following table showing the production of woven fabrics in wool, in linear yards:
Importa- Importations from tions from Canadian	Great	otherYear	Production	Britain	countries1946	
29,270,000	10,656,000	263,0001947	
27,217,000	10,256,000	3,940,0001948	
26,400,000	15,888,000	1,572,000
It will be noted that while Canadian production in 1946 was 29,270,000, in 1948 it had fallen to 26,400,000. The Canadian woollen textile industry and the Canadian textile industry have given employment to
180.000	people, and of those 180,000 people
18.000	are employed in the woollen textile industry. My colleague, the hon. member for Waterloo South (Mr. Homuth), feels somewhat diffident about speaking in the house, owing to a temporary disability in his voice. But he has spoken many times in the house about the textile industry. He is a textile manufacturer, and knows all about the trade, and assures me that this situation is so serious that not only will there be
18.000	woollen textile workers out of employment, but many hundreds of other workers in allied industries will be affected in the same way. He assures me that his own plant is on the verge of closing down. Manufacturers do not close their industries just for the pleasure of it, because it costs a lot of money to have a plant standing idle. A maintenance staff must be kept at all times. It is only because of economic difficulties that these mills are either closing down or operating on short time.
There is one thing of which I am very proud in connection with our woollen textile mills and that is that they were developed by families in a small way, in the beginning. I think all of them today are still owned by those families. In these circumstances the head of the industry takes a personal interest in all his employees.
In my constituency, with the eleven woollen textile mills, a large number of people receive

The Budget-Mr. Blair employment. One can readily understand that these eleven mills constitute a very important industry, when concentrated in one constituency. The industry has been built up over a long period of time, and has had to meet difficult competition because Canadian tariffs have not always offered sufficient protection.
In spite of the difficulties this industry has had, and which it has faced, it has made progress to the point where it is now one of the important industries in Canada. I quote from a review published in the Globe and Mail of October 1949 with respect to the woollen textile industry in Canada in 1947. This is a review of a government publication entitled "Woollen Textile Industries in Canada". The review in the Globe and Mail from the Canadian Press under the heading "Textile Industry Has Busy Year" states:
In a busy booming year, the Canadian woollen textile industry produced goods worth $125,039,169 in 1947, the bureau of statistics reported. Production was 16 [DOT] 3 per cent higher than in 1946.
The industry comprised 206 different plants, employing 18,593 persons with a total pay roll of $29,371,352 during the year. The year before, 208 plants in the industry employed 17,620 persons who were paid $24,418,748. Production in 1946 was valued at $107,539,253.
Biggest item in the industry was the production of woven suitings, dress goods, overcoatings and cloakings, and the output of 26,022,348 yards was valued at $53,185,146. The production was slightly lower, but the value $6,554,428 higher, than in 1946.
Greater quantities of carpets, mats and rugs were produced, the value being $8,687,766. The bigger production during the year involved higher imports of wool, yams, and piece goods. Total imports jumped from $61,451,933 in 1946 to $77,923,937 in 1947. Exports declined from $5,317,000 in 1946 to $3,772,240 in 1947.
So it is very apparent that this is an important industry. I bring the seriousness of the situation in the textile industry to the attention of the house without any desire to create the impression that we should revert to a system of high and unwarranted tariffs. I would point out however one thing the government should do to encourage a healthy and stable woollen textile industry in Canada, and that is to open discussions with the British government with the object of facilitating the purchase by Canadian manufacturers of British textile machinery needed in our textile industry so that it may compete with the great outside competition.
During the war years the textile industry of Canada contributed much to the war effort. This was made possible through the co-operation and skill of both employees and management, and the full capacity utilization of the machinery for production. In some cases today that machinery is obsolete or practically worn out as a result of having been used 24 hours a day during the war. Many of the

companies that desire to replace their machinery find they are unable to purchase it in the British market, notwithstanding the fact that British exports of textile machinery in 1948 increased by approximately 54 per cent in volume as compared with 1938. Exports of British textile machinery to Canada increased only 12 per cent in volume in the same period. I find on reviewing British trade figures that the exports of British textile machinery to Sweden increased by 367 per cent in volume in 1948 as against 1938. The volume of exports to Denmark increased 342 per cent in the same period, and the exports to Portugal were up over 497 per cent. My source for this information is from the accounts relating to trade and navigation of the United Kingdom for each month during the year 1948 covering British exports of textile machinery. With the permission of the house I should like to place further figures on Hansard.


Mr. Deputy Speaker:: Has the hon. member the permission of the house?


Some hon. Members:: Agreed.


William Gourlay Blair: The table follows:
British Exports Textile Machinery
Volume	(Tons)	Value	(Pounds)To	1938	1948	1938	1948Canada 	. 1,818	2,039	307,403	791,482Sweden 	. 631	2,949	114,560	1,282,132Denmark	. 255	1,127	46,488	514,990Netherlands ..	. 1,960	5,236	258,002	1,818,518Portugal 	. 430	2,570	52,006	769,624Turkey	. 173	669	24,484	272,044United States.	. 1,049	2,403	222,150	1,244,322Mexico 	. 373	1,642	64,004	639,273Chile 	, . 276	1,623	28,907	538,953Brazil 	. 5,048	9,094	502,801	2,936,728Argentine 	. 1,177	4,780	173,337	1,461,706I believe	everybody in	Canada	is sympathetic toward any trading program that will help the people of Great Britain establish themselves as one of the great nations of the world, but the livelihood of 180,000 textile workers in Canada is dependent upon the success of the textile industry in this country. One of the main exports by Great Britain to Canada is woollen textiles and these are being imported into Canada in increasing quantities to replace Canadian-made woollen textiles. British textile products and those from European countries are manufactured with lower labour costs than are similar products in Canada. It is possible also that the Canadian textile manufacturer may have to compete against some form of subsidization which will mean still less business for the Canadian textile mills. The result will be that the whole textile industry in Canada will suffer.
The standard of living in Canada is today at the highest point in our hislory and our

customs tariff should be adequate to maintain that standard of living. The duty on imported woollen textiles is now lower than when our standard of living was at a lower level. Not only are these goods produced in Great Britain for lower wages than are paid in Canada; food subsidies are also paid which reduce the production costs of British textiles.
Before devaluation the wages paid for the production of Canadian woollen textiles were 170 per cent of the British rates; they are now 220 per cent. This more than balances any advantage the Canadian textile producers might have through buying wool in sterling areas. Most of the raw wool used by both the British and Canadian textile producers originates in sterling areas, principally New Zealand and Australia. With the currencies of those countries being devalued it meant a cut of 23 per cent in the cost of wool imported into Canada, but that did not make any change in the price of wool going into Great Britain.
Since devaluation there has been a rise of over 23 per cent in the price of wool in the sterling areas which in fact wipes out any advantage to the Canadian purchaser from the devaluation of sterling. When the Canadian government devaluated the Canadian dollar 10 per cent in terms of the United States dollar it modified the sterling devaluation in terms of Canadian funds. Great Britain is now able to cut the prices of the textiles she sells in Canada.
Even before devaluation British textiles held a strong position in the Canadian market when the sales were about three and a half times greater than pre-war in terms of value and were much greater in terms of volume. On the pre-war market British textiles made up 36 per cent of British sales in Canada, whereas in 1948 they were 48 per cent. This was the result of a concentration of exports to one area. Imports of British textiles are in direct competition with types made in Canada. There should be a greater diversification of British trade in Canada and, as I have mentioned before, it should be sought through textile machinery which the Canadian industry is trying hard to secure.
At page 559 of Hansard a question was asked whether Canada was losing her domestic textile market to Great Britain owing to devaluation, and if there had been any layoffs in Canadian textile factories or wage reductions owing to devaluation. The parliamentary assistant to the Minister of Trade and Commerce stated in his answer that there was no evidence to show that the Canadian textile industry was losing its domestic markets to Great Britain, and that there had been no layoffs or wage reductions reported.
The Budget-Mr. Blair
I should like to quote from an article appearing in the Toronto Telegram of September 29, 1949, in which Mr. K. L. Markon, vice-president and general manager of Monarch Knitting Company, supported the claims of union leader Sam Baron that the devaluation of the pound is menacing the jobs of thousands of people engaged in Canadian textile industries. The heading of the article is:
Pound devaluation seen hitting jobs "thousands" here
The article reads:
K. L. Markon, vice president and general manager ol the Monarch Knitting Company Limited yesterday supported claims of union leader, Sam Baron, that the devaluation of the pound is menacing the jobs of thousands of people engaged in the Canadian textile industry. In a prepared statement Baron, Canadian director of the textile workers union, C.I.O.-C.C.L., called for the immediate establishment of a royal commissio'* to investigate conditions in the industry and possibly offset a major layoff. Markon believed this to be a sound idea.
Claiming that the industry is the largest single employer of labour in the dominion, engaging 100,000, Baron produced figures to support his fears of mass unemployment.
Then there is a subheading reading:
Costs are lower
The article continues:
In the cotton industry, Baron claimed British exporters are offering cotton yarns on the Canadian market at roughly 10 per cent below the price on the home market. The effects will be greater in cotton piece goods and knit goods, he predicted.
"For instance, a British line of underwear that was being sold wholesale at $6.25 a dozen only a week ago is now being sold at $5 a dozen. The same applies throughout the woollen industry," he continued. "The most striking example of this is the hosiery industry where, even before devaluation, the majority of plants were working only two or three days a week because of British exports."
Markon said the information given by Baron was "substantially correct, particularly in regard to the woollen industry."
Head of one of the largest companies of its kind, manufacturing woollen, worsted and cotton knit goods, including hosiery, Markon said the woollen industry was in a "difficult position" before devaluation.
Then there is a further subheading reading:
Tariffs too low
The article continues:
"That difficulty was partly caused by various means used by British authorities to stimulate exports to Canada, such as indirect subsidies and export quotas, also by the fact the American economy was protected by tariffs while ours was not protected as much."
Markon, whose firm engages 1,100 workers, explained that prior to the devaluation, the company because of competition from Britain was forced to lay off some employees, particularly in the hosiery department, "and is going to be worse now."
"The textile industry seems to be bearing the brunt of things and this doesn't seem to be fair particularly in view of the fact the industry is the largest employer in Canada," he concluded.

The Budget-Mr. Simmons
I agreed with the Minister of Finance (Mr. Abbott), when he said there would be some dislocations in Canadian industry as a result of the unexpected degree of devaluation of the British pound. I question, however, the wisdom of any policy that asks any industry to bear the full brunt of the effects without making any evident effort to fully appraise the situation in the light of recent events. How often have we heard from our western representatives the story of the sacrifice they made in wheat. I agreed with them. Why should the wheat farmer stand the full cost of our assistance to Great Britain? I say now: Why should the textile industry be placed in the same position?
We must build up our Canadian economy. We cannot have social security without taxes. We cannot have taxes without employed people to tax. What good is it for us to have busy textile workers in Yorkshire, England, when our own textile workers are walking the streets? The Canadian textile industry, operating in a less protected market than manufacturers in the United States, has even before devaluation been subjected to such competitive stimulants as indirect subsidies and export quotas by the British government. Now they are to be faced with additional competition arising from advantages accruing to British manufacturers as a result of devaluation of the pound. This industry is one of the largest employers of labour in Canada, and many Canadian homes are dependent upon it for their very existence. This industry played a most important part in the war effort of Canada, and in my opinion it is essential that it be maintained as a healthy, virile industry as part of our economic defence plans of the future.
To the degree that the Canadian market can absorb British textiles, I agree that every encouragement should be extended as a means of helping Great Britain earn dollars to buy our primary products. I submit, however, that it is not in the national interest for the textile industry to be forced to close its doors, and for workers, who have given many years of their lives to developing this trade, to be thrown out on the street to look for work wherever they can find it. Unless external conditions and factors today threatening this vitally important industry are closely studied, and their effect constantly observed by the government, the conditions I have just warned about are not beyond the realm of possibility.


Mr. J. A. Simmons (Yukon-Mackenzie River):: Mr. Speaker, my riding is in the eyes of the world today because it constitutes the northwest frontier of our nation. It looks out upon the old world of Europe and the more ancient world of Asia across the Arctic


ocean. The constituency of Yukon-Mackenzie River is much larger than the territory of Alaska which will, we are told, soon be the forty-ninth state of the United States of America. It is an area in size nearly equal to all of British Columbia, Alberta and Saskatchewan. It is one-fifth as great in area as continental United States of America.
With this vast region as a background, I hope that I may be pardoned if I take some time of the house to convey to you the hopes and aspirations of our people, and something of their handicaps and difficulties. My address must be heard in the light of the status of our constituency of Yukon-Mackenzie River. It is in Canada but is not a province of Canada. It is for the most part a vast unorganized domain. It is a land of opportunity. Down north we have a land which should present great opportunities for the youth of Canada. You will note, Mr. Speaker, that I say "down north". Yes, all our rivers run down towards the north, the mighty Yukon river and the still mightier Mackenzie river. I am amazed to hear in this house and various cities in the east expressions of fear and despair when our great northland is mentioned. If eastern Canadians, especially the hon. gentlemen of this house, could travel with me throughout the length and breadth of my riding, they would realize that in Canada we have only made a beginning upon the development of our natural resources.
When it is realized that in the riding which I have the honour to represent, much of it unexplored, there is such a small scattering of people and so little industrial development as compared with the possibilities, it will become apparent that this house should concern itself with a more intensive policy of northern development and also with a sane project for moving numbers of people into the northland to places where they could live and thrive. In addition to this, a substantial increase in population in these areas is a direct contribution to the defence of Canada.
Originally, the Northwest Territories covered all that portion of the country from the Hudson bay westward within Canada outside of the provinces. Then in the nineties, upon the discovery of gold in the Klondike valley, the Yukon Territory was established under the Laurier government. It is governed by a commissioner, appointed, and a territorial council of three elected members who have a three-year term of office. The seat of government is at Dawson, Yukon. The Department of Mines and Resources at Ottawa is responsible for the business arising from the general administration of the territory under the Yukon Act and ordinances passed by the territorial council.

For administrative purposes the Northwest Territories were divided into three districts, namely, Mackenzie, Keewatin and Franklin, by order in council of March 16, 1918. In accordance with the Northwest Territories Act, the Northwest Territories are governed by a commissioner, a deputy commissioner and five councillors appointed by the governor in council and operating from this capital. The commissioner and council has power to make ordinances for the government of the territories under instructions from the governor in council or the Minister of Mines and Resources, subject to any act of the parliament of Canada applying to the territories. The future I eventually see for the Mackenzie River district is an entirely new set-up with an elective body. Our people feel that, while the present administrations are good, and while able men are giving of their best efforts, sooner or later we should have responsible government throughout in keeping with the Canadian tradition of responsible government.
Let me say and repeat that we believe the present executive officials are doing excellent work. Yet, the north wants to have a thoroughly elective government and, sooner or later, I am hoping to see it brought about. We advocate nothing new in this regard. You had the same request a century ago when the wilds of Upper Canada came under responsible government; later when, in 1905, Alberta and Saskatchewan came into being as provinces; before that when a provincial capital was set up at Winnipeg. Representation by population was an early battlecry in this country and along with it went "no taxation without representation."
I should like now, Mr. Speaker, to say a few words in regard to the electoral district of Yukon-Mackenzie River. At the last session of parliament the Mackenzie River district in the Northwest Territories was annexed to the Yukon electoral district, notwithstanding the many protests by the peoples of the Mackenzie River district and the Yukon territory. They did not want it and still do not want it and have a legitimate cause for complaint. The communities are scattered and there is little community interest between the peoples of the Mackenzie River district and the Yukon Territory-no more than as between the St. Lawrence river watershed and the Columbia river valley in British Columbia. If I might give an illustration: It is my opinion that the present federal riding is too large and unwieldy, and that it was a mistake to make such a large electoral district. A candidate travelling about it at election time must use aircraft almost exclusively and the cost is exceptionally high.
45781-87i
The Budget-Mr. Simmons
I believe you will agree that, in view of the circumstances I have outlined, it would be well to amend the redistribution act to provide for subdividing this vast riding and allowing two members-one for the Yukon proper and one for the Mackenzie and eastern sections of the Northwest Territories from the Mackenzie mountains to the Hudson bay. It might be argued that the population does not justify this adjusted representation, but it must be borne in mind that the populations of both areas are rapidly increasing and the economic conditions must necessarily always be different.
The future of Yukon Territory and Mackenzie River district is dependent upon the development of its mineral resources. These are among the last remaining reservoirs of minerals on the North American continent. As the minerals in the older areas become depleted and as the demand increases, it will become imperative that the mineral wealth of our north country should be developed. Portions of the Pre-Cambrian shield lie within the Mackenzie district and geologists claim untold wealth is still to be taken from this source. So far, this area has only been scratched. Indications are that vast sections of it are mineralized and present favourable opportunities for the prospector and developer.
In 1896 the fabulous Klondike gold discovery was made. This was the poor man's opportunity because he could begin to produce gold from the placer workings by his own strength and effort and with little or no capital. Perhaps because of this and the remoteness of the area placer mining remained the prime mining interest in the Yukon Territory for many years. Since then, many opportunities for lode mining have been discovered. One of the most important of these lies in the silver-lead-zinc deposits of the Mayo-Keno area in the Stewart river district. Some of the ore from this district is so rich in silver and lead that it can be shipped to the smelter at Trail, British Columbia, in the same condition in which it is taken out of the ground without being put through the concentrator. I would ask you to consider how rich this ore must be when it can stand the cost of transportation and the many handlings by truck to Mayo Landing; by river boat to Whitehorse; by train to Skagway; by boat to Vancouver and thence by rail to the smelter at Trail, British Columbia, in its raw state and without concentrating.
I am now informed that the mining company at Mayo Landing expects to ship 15,000 tons of silver-lead ore and concentrates next year, the largest amount ever to be shipped from this district in any one year. This means employment for men. It means an
*362	HOUSE OF
The Budget-Mr. Simmons added market for the goods from the warehouses in Vancouver and other places. It means adding millions of dollars to the silver treasury of the world. Mr. Speaker, it surely does not sound like depression.
I note, Mr. Speaker, that in 1948 several million dollars' worth of silver bullion was shipped to the United States of America. Some of this goes to other countries where they use our silver for coinage and for jewelry; and right here I would suggest that it would be a nice gesture on the part of the Department of Finance to strike off a few Canadian silver dollars-not a few but let us say $1 million a year for a few years, to make the people of this country more silver conscious, but not enough to upset our currency here. In a country like Canada, with silver mines in Ontario, British Columbia, Quebec and the Yukon which in all produce many million dollars' worth of silver each year, surely we should have a larger silver coinage in our country.
The development of this area has only begun. There are many other areas of equal importance in the Mackenzie district and Yukon Territory awaiting development. There are indications that one of the largest iron ore deposits in North America lies in the Selwyn mountains of central Yukon. Prospectors and geologists have found indications of widespread deposits of lodegold, tungsten, copper, tin, molybdenum, silver, lead, zinc, antimony and coal. It i's known that the huge copper deposits of southeastern Alaska extend into the Yukon. At Whitehorse there is an interesting copper belt which was mined during the first world war. To date Yukon Territory has produced nearly one-third of a billion dollars in gold and silver-I repeat, one third of a billion dollars of new wealth.
Now, Mr. Speaker, let me say something about the mineral potentialities of the Mackenzie river district. It is known that a great part of the Northwest Territories is covered by Pre-Cambrian rock. This same rock formation supports the mining industry of Quebec, Ontario and Manitoba. Its potentialities in the Northwest Territories, where it has hardly been scratched, are immense. So far we have the pitchblende and the radioactive mineral deposits at Port Radium on Great Bear lake. The magnitude of this operation is known throughout Canada. We also have the lode gold operations of the Yellowknife mining district on the north side of Great Slave lake. Tremendously interesting deposits of lead and zinc are being investigated on the south side of Great Slave lake, at Pine Point, and of radioactive minerals in widely scattered areas to the northeast of the same lake. Copper deposits along the


Coppermine river near the Arctic coast have been known for many years. Let me here, Mr. Speaker, pay my tribute to Gilbert La Bine, the Canadian prospector who discovered uranium ores in my riding, whose work was so valuable to Canada and the world in strengthening the bonds which make democracy and the democratic countries of the west a subject which is so much discussed among the nations today. And when I pay tribute to Mr. La Bine I do so because he is typical of the whole race of prospectors who are finding the hidden wealth of the northland, and making it possible for great industries to be built and great new sources of revenue to be created for our country.


Mr. Fleming:: He is a distinguished resident of Eglinton riding.


James Aubrey Simmons: That is fine. Yellowknife in the Northwest Territories and Dawson in the Yukon Territory are centres of revived gold mining activity. Yellowknife is the hub of the mining industry in the Northwest Territories and today is a flourishing and thriving modern town. Three important gold mines are operating in this vicinity: the Con-Rycon mine, the Negus mine and the Giant Yellowknife.
The first gold brick was produced in the Northwest Territories and poured at the Con mine of the Consolidated Mining and Smelting Company in September, 1938. Yellowknife mining district has produced to date well over $25 million in gold. These mines and others under development contain vast quantities of gold. Engineers have blocked out ore which assures operations for many years to come. At present more than one thousand men are employed in the gold mines there. There is every indication that production will be increased as further properties are being prospected and developed.
Dawson city is the hub of gold mining in the Yukon territory. It is probably the oldest producing placer gold mining camp in the world. This year the production of gold has been very active as it has been in the past for many years. This summer's operations alone produced well over 50,000 ounces of gold up to the end of August. By the end of the dredging season this fall there will be many more thousands of ounces of gold to be added to the quantity given here. Eight dredges are being operated by the Yukon Consolidated Gold Corporation in the Dawson district.
Oil resources along the Mackenzie river at Norman Wells are deserving of attention and are considered to be very important. Oil reserves in the Norman Wells area, estimated by United States government experts and checked by Canadian authorities, are placed

The Budget-Mr. Simmons
at 60 million barrels. There are sixty productive wells in this area and from 1942 to the end of 1948 they produced nearly 3 million barrels. There is a small refinery at Norman Wells which turns out the fuel requirements for the Mackenzie river district.
I have told you something about the mineral resources of my constituency. We have sufficient indications to know that there lies a practically untapped reservoir of mineral wealth awaiting development for the benefit of the area and of Canada as a whole. Its development will depend upon the provision of adequate transportation facilities and cheap power.
In the Yukon Territory the Department of Mines and Resources have undertaken the construction of an all-weather highway from the Alaska highway near Whitehorse to Mayo and Dawson. A good start has been made and it looks as though the Carmacks-to-Mayo section will be completed this fall.
I would call attention to the urgent need of having the remaining sections of the road between Whitehorse and Dawson completed by the end of the 1950 construction season. I would also call attention to the urgent need of the early provision of cheap power for the Mayo-Keno mining area so that the mineral resources of the district may be adequately developed.
Electricity for operating the mines is now produced by diesel engines, and the diesel oil is brought in from the outside at high cost. Transportation also complicates the shipping and storage problem. If the mineral wealth is to be exploited at depth, it will require cheap power. This can only be provided by means of hydroelectricity. I understand that the Department of Mines and Resources during the past summer has been investigating the possibility of hydroelectric development in the Mayo river canyon. I hope that the government will be able to push this project through in the same manner as was done on the Snare river project for the benefit of the Yellowknife mining district in the Northwest Territories, which has proven of great benefit to that district.
The needs of the Mackenzie river district for the development of its mineral resources are similar to the Yukon Territory. They are the provision of adequate transportation facilities, the lowering of present transportation costs and the provision of cheap power. A good start has been made by the construction of the Mackenzie highway, by which freight can be hauled both incoming and outgoing between the Northern Alberta Railway at Grimshaw, Alberta, and Hay River, Northwest Territories. What is now urgently needed is the extension of this highway to
give year-round communication with Mills lake and Yellowknife; and also to put the Alberta section of the Mackenzie highway in good repair so that there will not be a repetition of the difficulties encountered by truckers this past season, which proved so very disastrous to the fishing industry on Great Slave lake.
One of the present main difficulties in getting supplies to Yellowknife and down the Mackenzie river is the lateness in which Great Slave lake gets free of ice. When the river is open in the late spring the ice remains in the lake and piles up at the outlet. In addition, winter travel over the ice is made hazardous by pressure ridges. The construction of an all-weather road to Mills lake will detour the ice piled up at the outlet to Great Slave lake, and the rapids at Fort Providence, and extend the shipping season on the Mackenzie river by at least six weeks each year.
The present costs of transportation into the Mackenzie river district are too high. This affects the cost of living and the cost of mining. Everything which can be done to lower these costs will encourage the development of mining and other industries and raise the standard of living of the people. The mining companies and the stores and trading posts have large amounts of capital tied up in maintaining large stocks of supplies on hand because of the shortness of the navigation season, which necessitates stocking about nine months' supplies each year. This increases the cost of operation of the mines. If an all-weather road was constructed into Yellowknife via Mills lake it would enable the mining companies, stores and trading posts to maintain lower inventories of supplies and thereby reduce costs of operations. This would be the equivalent in one way of raising the price of gold. Therefore for the good and welfare of the Mackenzie river district something should be done to lower the present freight rates either by improving transportation facilities, providing more competition or competitive routes or by means of a subsidy. It is hoped that the government will take the matter of constructing the all-weather highway to Mills lake into immediate consideration, so that an early start can be made on construction next spring.
Now, Mr. Speaker, I desire to tell you something about the economic plight of the natives, both Indians and Eskimos of Yukon Territory and the Mackenzie river district. In this modern day when we are giving Indians in some sections of the country the ballot, it is only fair that the Eskimos should receive the same consideration. Great work can be done for the native peoples of our land.
1364	HOUSE OF
The Budget-Mr. Simmons
In this connection I wish to commend the church organizations in my riding, and also the lands and development services branch and the Indian affairs branch of the Department of Mines and Resources and the Department of National Health and Welfare, for the great work they are doing among the native population. But still greater work can be accomplished. In my journeys through the riding last summer as far north as Aklavik, Northwest Territories, I observed that the church was extending a helping hand to the natives of this country in leading these people to better standards and citizens. They are dependent entirely upon trapping and hunting for a living. You will understand in many areas something of what has happened, Mr. Speaker, when I tell you of the recent decline in fur prices. Silver fox pelts have dropped from $20 to $5 and even as low as $3. Muskrat skins have dropped from $3 to 80 cents, and may go lower. Other furs have declined in price in a similar manner. To make matters worse the hunting in some areas has also declined. As a result of these conditions the natives of the north are now experiencing exceptionally hard times, and I must say that the family allowance has been, and will be, a godsend to them.
It is hoped that the government will continue to deal sympathetically and helpfully with these matters and extend relief to these unfortunate people where necessary. It would be best, where possible, to give them opportunities of earning what relief is given. In this connection I would like to see them given employment on the various construction projects in the northland. Very often when government contracts are awarded to construction firms, labourers are brought in from distant places to do the work. Many of our Indians and Eskimos are excellent workers, and if encouraged and treated as Canadians they would perform valuable services wherever such projects are carried on. It may interest the house to know that some of these Indians and Eskimos are splendid mechanics. I have found many of them to be energetic, thrifty men, good businessmen and good Canadians.
The time has come when racial discrimination in the north should be put aside and all our citizens who obey the laws and help to build up a better country may be treated with equality. Many of the settlements in the north could be improved by the provision of graded roads, ditches, sidewalks, better water supplies, and sanitary arrangements; in other words a general tidying-up. It would be an opportune time to provide these facilities so that the natives could improve their


communities and at the same time work for wages to supplement their incomes from trapping.
As I have said before, in districts where roads, airfields and weather stations and other projects have been or are being built a greater proportion of native people should be engaged on the work, as many of them are good mechanics and operators and they should be given every encouragement to acquire and practise trades.
A new era is dawning for the north. It is going to be opened and its resources developed, and the pace is going to be accelerated. Therefore let us see that the native inhabitants also benefit from these developments. We must help them wisely and sympathetically to adapt themselves to these changed conditions, and we must provide better hospital and medical care. We must also see that the game, wildlife and forest resources of the north are properly managed and protected. Do we know as much about these resources as we should? Do we know why the game and fur have been so depleted in certain areas? Have we figured out how to improve this situation? I would ask the government these questions. The mines and settlements in the Yukon and Mackenzie river districts look to the forests for building logs, lumber and fuel. The forests give protection to watersheds and wildlife; therefore our forest resources must be adequately protected and managed for they are vitally essential to the economic life of the northland.
At this time I wish to thank the right hon. Minister of Agriculture (Mr. Gardiner) for the attention being given food production in the Yukon and Mackenzie river districts. As you know, we pay heavy freight rates on food products and other commodities brought in from the outside. Therefore if we can produce some of the staples within the northland, we add to the prosperity of the people.
All along the Yukon and along the mighty Mackenzie are scores of settlements which buy meats, flour, butter, lard and the many products of the farm. All must come in at great cost to the consumer. At Fort Simpson, Northwest Territories, there is an experimental farm operated by the Department of Agriculture; but long before it was established the Roman Catholic mission there had conducted a successful farm like any farm one would see in the Ottawa valley. This farm has been in operation for nearly sixty years, and has been engaged in dairying, and the production of pigs, poultry and grain.
Yes, grain ripens there at Fort Simpson, junction of the Liard and Mackenzie rivers, north of the 61st parallel and slightly west of the 120th meridian. At Fort Good Hope,

slightly south of the Arctic circle, there are records of grain being matured; certainly there are fine potatoes and root crops, lettuce and many garden varieties.
At Aklavik in the Mackenzie river delta, within the Arctic circle the Anglican mission maintains a garden and has a few cows, a tractor, plows and other farm gear and has cultivated fields of oats-not always successfully but well enough to provide local fodder supplies for the livestock.
At Pine creek in the Yukon Territory, 100 miles northwest of Whitehorse on the Alaska highway, there is an experimental farm operated by the government. This farm was established a few years ago under the expert management of Mr. J. W. Abbott, formerly of Fort St. John, British Columbia. The first year, 1946, witnessed a very poor crop indeed -spuds the size of marbles, turnips all tops and no body, barley very short and poor, and oats a failure.
In 1947, the crop of potatoes was fairly good, showing improvement as the soil was opened to the sun and cultivation. In 1948 several hundred dollars' worth of garden stuff was sold to the local merchants in Whitehorse, besides keeping a good supply for the farm and employees. Now in 1949 Mr. Abbott is buying livestock for the farm which is producing hay, oats, root crops and vegetables and promises to be quite productive.
I do not say this is a ranching country, but if we can produce a tonnage of food there on the land one hundred miles northwest of Whitehorse and at various places along the Mackenzie river, what a benefit it will be to the economy of the north! At all events these experiments are revealing the possibilities and we are getting exact data on weather, hours of sunshine and soil conditions.
A number of farms have been successfully operated for some time on a small scale at other places in the north, such as at Yellowknife, Dawson, Stewart City and various other places in the Mackenzie river district and the Yukon. On the Pelly river a farm has been operated successfully for many years, and one year as much as 2,300 bushels of oats were harvested.
This is a bright picture for the future of the north, and it may well be that a large population can eventually be established on lands north of the Peace river block in British Columbia and in the Yukon and Mackenzie river areas. These experiments will give us some guide as to the feasibility of settlement, and I hope that there may be larger grants next year for the experimental work now undertaken in the north.
If time will permit, Mr. Speaker, I should like to mention one or two other matters
The Budget-Mr. Simmons which are also of prime importance to the economy of the northland. The commercial fishing industry on Great Slave lake, 340 miles south of the Arctic circle, in the Northwest Territories, has become one of the world's greatest inland commercial fishing areas. This lake is the fifth largest on the continent and commercial fishing in this area was first started in 1945.
The commercial catch limits for trout and whitefish together from Great Slave lake were increased in June of this year to a total of five million pounds for the summer fishery and to a total of four million pounds for the winter fishery. During last winter season well over four million pounds of fish were taken by 302 licensed fishermen under special catch limits. A high standard of quality is maintained and all shipments are inspected at Lower Hay river. Importers in Chicago, New York and Detroit speak highly of the fine quality of the whitefish and trout from Great Slave lake. This industry is dependent upon the proper maintenance of the Mackenzie highway to transport their products to the railhead at Grimshaw, Alberta.
Before closing, Mr. Speaker, I should like to say a few words about the great Alaska highway which you have all read so much about. In travelling about the country I find that there exists in certain quarters an apparent misconception of the value of this highway from an economic point of view, and I should like to take this opportunity to correct this erroneous impression, and point out that the Alaska highway and its feeder roads, such as the Haines cut-off and the Atlin road are vital to the defence and economy of the north and to the North American continent as a whole.
The Alaska highway supplies a main trunk road which is of major importance in opening up the country and from an economic and defence point of view that is of paramount importance. In addition to its value to industry and defence the Alaska highway and its feeder roads provide a tourist attraction equivalent to any place on the North American continent. I may tell the house that the Alaska highway, so important in a defence way, is, in these times of peace, a busy commercial thoroughfare, and is opening up a great new country throughout its 1,600-mile length from Dawson Creek, British Columbia, to Fairbanks, Alaska.
It is indeed a credit to Canada and also to our good friends from the United States of America who made such a wonderful job of constructing it. It is a great scenic highway, and you have magnificent lakes and rushing rivers, mountain peaks and ranges, and everything that delights the lover of the

The Budget-Mr. Simmons outdoors. There are good stopping places at intervals along the highway, gas stations and garages, and the traveller need have no fears.
The Canadian portion of the Alaska highway from Dawson Creek, British Columbia, to the Alaska-Yukon border, a distance of 1,223 miles, is maintained by the northwest highway system of the Canadian army and I wish, at this time, to commend them for the excellent job they are doing under the command of Brigadier Connelly, in keeping this highway open.
The hon. the Minister of Mines and Resources (Mr. Gibson) recently made a trip to the Yukon and Mackenzie river district. I would assure him that the people of the north were deeply gratified by his visit and feel that he will now be able better to understand their problems.

I also wish to compliment the hon. me Minister of Finance (Mr. Abbott) upon his excellent budget. It means a great deal to us because of the large appropriations which are essential in so vast a riding. With an able and experienced man bringing down such a budget the people of the north have the utmost confidence in this government and in the future of the nation.
On motion of Mr. Knight the debate was adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: the adjournment of the house.
He said: Tomorrow we hope we may be able to conclude this debate.
Motion agreed to and the house adjourned at 10.55 p.m.

Wednesday, November 2, 1349