1949-04-26

STANDING COMMITTEES


[Stage Direction]
Fifth report of standing committee on miscellaneous private bills.-Mr. Winkler.

Hon. Alphonse Fournier (Minister of Public Works) moved:: That the name of Mr. Jaenicke be substituted for that of Mr. Herridge on the standing committee on railways, canals and telegraph lines.


[Stage Direction]
Motion agreed to.


Mr. Matthew MacLean (Cape Breton North-Victoria) moved:: That the standing committee on standing orders be granted leave to sit while the house is sitting.


[Stage Direction]
Motion agreed to.


Mr. H. W. Winkler (Lisgar) moved:: That, for the remainder of the session, all private bills from the Senate, when received from that house, be read a first and second time and be referred forthwith, and that standing order 105 respecting the posting of private bills be suspended.


Mr. Speaker:: Is it the pleasure of the house to adopt the motion?


Mr. Dorion:: No. On a point of order, Mr. Speaker, this motion requires forty-eight hours' notice.


Mr. Speaker:: Mr. Winkler moves, by leave of the house-


Frédéric Dorion: No; he needs unanimous consent, and I do not consent.


Mr. Speaker:: If the hon. member has not the unanimous consent of the house, I cannot put the motion.



CALGARY STAMPEDERS


Mr. A. L. Smith (Calgary West):: Mr. Speaker on a point of personal privilege- indeed, it is a very special personal privilege
-may I say that in the place in which I live, and whence I have just returned, we have recently had two distinguished visitors. While they were there we tried to do them honour.
I am most happy to inform you, sir, that the Right Hon. Prime Minister of Canada (Mr. St. Laurent) and the Right Hon. Leader of the Opposition (Mr. Drew)-


An hon. Member:: No, not "right honourable".


Arthur Leroy Smith: -the hon.
leader of the opposition-


Mr. MacNicol:: He will be "right honourable".


Arthur Leroy Smith: This is not wishful thinking, sir. We wish to do them all honour, and it is my privilege to inform them that the Prime Minister has been made honorary president of the Calgary Stampeders Quarterbacks club, while the leader of the opposition has been made honorary vicepresident. I now give them the credentials which will for ever prove the great honour which they have achieved outside this chamber.


Right Hon. L. S. St. Laurent (Prime Minister):: Mr. Speaker, I am sure the Leader of the Opposition and I are grateful for this testimonial of the regard in which we are held in the delightful city of Calgary.


Mr. George A. Drew (Leader of the Opposition):: Mr. Speaker, I too wish to express appreciation of this membership, which of course will give us special privileges when we are able to attend the Calgary stampede this year.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. John O. Probe (Regina City):: I should
like to ask a question of the Minister of Transport, of which I have given notice. Will the minister please inform the house as to the position taken by his department with respect to the age limit of members of the Canadian merchant marine eligible for educational benefits provided by the Department of Veterans Affairs, and under what circumstances this age limit has been waived for extenuating reasons?


Hon. Lionel Chevrier (Minister of Transport):: The committee on veterans affairs
2574

Inquiries of the Ministry recommended some time ago that certain educational benefits be provided for members of the Canadian merchant marine up to the age of thirty years. The department has passed regulations making provisions for those benefits. I am not aware that there has been any waiving of the thirty-year regulation, or that there is any intention to waive it.



PEACE RIVER DISTRICT


[Stage Direction]
On the orders of the day:
Mr. William Irvine (Cariboo):: I should like to ask a question of the Minister of Transport. Has the government given consideration to the building of a railway outlet from the Peace river to the west coast? If so, is it likely that work will start this year?


Lionel Chevrier: Mr. Speaker-


William Irvine: No smiling, now; I am serious about it.


Lionel Chevrier: I assure the hon. member that I too am serious about it. May I say in reply that the government has given and is still giving serious consideration to this extension, as is the Northern Alberta Railways. I presume the hon. member has in mind an extension westerly from that railway. No decision has yet been arrived at.
I am sure the hon. member is aware of the announcement which has been made, either by the premier or by certain officials in British Columbia, to the effect that the Pacific Great Eastern will be extended from Quesnel to Prince George. I believe the statement went on to say that it was the intention to project it into the Peace River district. Beyond that, and the statement I made when the matter was up for discussion in the house on a previous occasion, I have nothing to add.



REMOVAL FROM MARKET TO SUPPORT FLOOR PRICE


[Stage Direction]
On the orders of the day:
Mr. H. H. Hatfield (Victoria-Carleton):: should like to ask a question of the Minister of Agriculture or his assistant. Will the minister inform the house whether any butter has been removed from the market to support the floor price, and whether in future the government will let butter find its own price level and subsidize the producer up to the floor price so that butter will give oleomargarine some competition on the market?


Mr. Knowles:: Where is the minister?
{Mr. Chevrier.)


Mr. Robert McCubbin (Parliamentary Assistant to the Minister of Agriculture):: Mr. Speaker, I returned to Ottawa only this morning, and I have not been in touch with departmental officials. I shall answer the hon. member's question later this week.



PRAIRIE FARM ASSISTANCE


[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Wood Mountain):: I should like to ask a question of the Prime Minister. In view of the widespread drought conditions in western Canada, and the need for increased crop failure payments made on a more equitable basis, will the Prime Minister inform the house whether the amendment to the Prairie Farm Assistance Act forecast in the speech from the throne will be proceeded with at this session?


Louis Stephen St-Laurent: I find the hon. member's question somewhat involved. There are so many qualifying provisions in it that I shall have to look at it in printed form before I venture to give an answer.


Mr. Coldwell:: The question is clear.



PRAIRIE FARM REHABILITATION


[Stage Direction]
On the orders of the day:
Mr. F. S. Zaplitny (Dauphin):: In the
absence of the Minister of Agriculture, may I ask his parliamentary assistant whether the department has received a resolution passed by the Manitoba legislature calling for the extension of the Prairie Farm Rehabilitation Act to cover northwestern Manitoba? If so, what action does his department intend to take in that regard during the present session?


Robert McCubbin: I am
not in a position to answer the hon. member's question at the moment. I shall give an answer later this week.



OLD AGE PENSIONS


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: I should like to ask a question of the Minister of National Health and Welfare. Is there not an omission-surely by error- in the motion of which the minister gave

notice yesterday, in that no reference is made to raising the ceiling on old age pensioners' incomes so that they may be permitted to get the increase indicated in the motion?


Hon. Paul Mariin (Minister of National Health and Welfare):: When this measure is discussed in the house the hon. member will have a detailed reply to his question. But let me tell him, since he has asked the question, that our income ceiling, in terms of what the pensioner may have in addition to the basic pension, is a more generous allowance than that made by any other country in the world. When the hon. member puts his question in the form in which he does, he seeks to leave the impression that such is not the case.


Major James William Coldwell: What about social security?


Stanley Howard Knowles: A supplementary question-


Some hon. Members:: No.


An hon. Member:: Sit down.


Stanley Howard Knowles: I am not debating the matter. I am merely asking the minister whether the present other income allowed will be retained after this measure passes.


Paul Joseph James Martin: The hon. member knows perfectly well that the time to ask that question is when the measure is under discussion.


Stanley Howard Knowles: The motion indicates that it will not.



PRICES PAID BY MILLERS

[Stage Direction]
On the orders of the day:
Mr. J. W. Burion (Humboldt):: I should like to ask a question of the Minister of Trade and Commerce. At what prices do Canadian millers obtain wheat from the wheat board for (a) domestic consumption, and (b) export?
Right Hon. C. D. Howe (Minister of Trade
and Commerce): The millers obtain wheat for export to the United Kingdom at the United Kingdom price, and also they obtain wheat for domestic flour. For all other sales they pay the class II price for wheat.


Arthur Leroy Smith: That is for the
export of flour?


Mr. Howe:: Yes.



FREIGHT RATES


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I should like to ask the Minister of Transport if the government has considered taking action to offset the freight rate increases announced by
Inquiries of the Ministry the Canadian Freight Association on purebred livestock and on livestock entered in exhibitions and sales.


Lionel Chevrier: I have not seen any announcement of the increases in freight rates which my hon. friend says have been announced by the Canadian Freight Association. I was under the impression that increases in freight rates are decided by the board of transport commissioners, or by the railways themselves under the terms of the Railway Act, to meet water and highway competition. The hon. member for Humboldt (Mr. Burton) asked a similar question yesterday, and I suggested if he would give me the detailed information I should be glad to look into it. I make the same suggestion to my hon. friend.



INQUIRY FOR RETURN


[Stage Direction]
On the orders of the day:
Mr. C. E. Siephenson (Durham):: On March 28 a question which I had asked was passed as an order for return. Will the responsible minister tell me when I may expect the return?


Clarence Decatur Howe: I shall be glad to make inquiry and see that the return is brought down as soon as possible.



MIGRATORY BIRDS


[Stage Direction]
On the orders of the day:
Mr. R. M. Warren (Renfrew North):: should like to ask the Minister of National Health and Welfare (Mr. Martin) if he is aware that my farmer friend to whom I referred on April 8 reported on April 17 that he is getting assistance in taking care of some 4,700 geese which are now on their way to their natural haunts.



THE BUDGET


[Stage Direction]
The house resumed from Monday, April 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. Macdonnell (Muskoka-Ontario), and the amendment to the amendment of Mr. Coldwell.
Mr. J. H. Blackmore (Lethbridge):: Mr. Speaker, last evening, just as the house adjourned, I was placing before the house

The Budget-Mr. Blackmore the case of Lieutenant Stuart Brown, and I had asked several questions of the Department of Veterans Affairs and the government concerning this unfortunate man. I had also read into Hansard excerpts from an article written by Lieutenant Stuart Brown entitled, "They put me in Essondale."
This article appeared in the Sunday Sun magazine of Vancouver, the issue of January 8, 1949. I quote from it as follows:
In 1927 I was a law-abiding citizen of Vancouver, partner in the building firm of Saunders and Brown, and at the same time employed as a real estate salesman for the firm of Waghorn, Gwyn and Company.
That year I entered Shaughnessy hospital to be treated for neurasthenia (nerves) and gunshot wounds. If treated for neurasthenia I might-in fact, most surely would-become pensionable. On the other hand a mental diagnosis would nullify entitlement to a war pension.
It was the general practice of the then medical superintendent at Shaughnessy to eradicate entitlement to pensions by any means possible. Such practice eventually led to his death at the hands of Tim Sargood by shooting.
And so the inference of insanity in my case started.
As I am quite normal, some means must be found to upset me-or my grounds.
And further down he says:
Through a pal came the first intimation of my wife's infidelity and the nature of the tie-up with this man. I phoned her on a Saturday night, asking her to eject him from our house, at the same time saying I would be home Sunday for tea. Instead of ejecting her boy friend she consulted the doctor, and from the South Vancouver police blotter this item is taken:
"Doctor Jones, Shaughnessy hospital, Fair 6000, reports a Lieutenant Brown, of 309 Slocan street, who is a patient at the hospital, went home today and threatened to kill his wife with a knife. Dr. Jones states this man is most likely to commit this act and would like him picked up and held at the station, and arrangements will be made to take him to Essondale. At this time Sergeant P. C. McKay and P.C. Lloyd brought to station Lieutenant Brown, requested by Dr. Jones, Shaughnessy hospital, to be picked up."
Here were the first illegal processes by the pensions department: (1) No warrant sworn; (2) no entry could be made into my house without a warrant.
The item about the knife is absurd. I did not even see my wife and her boy friend, who were down at the doctor's, and if I intended any real damage I owned a German Luger and a 16-gauge gun. Why use a messy knife?
Another quotation reads:
A sworn affidavit by George Watson, visitor at my house, states:
"I beg to state he was in a normal condition during his visit and conducted himself properly up to the time he left with the police officers."
A. McKay the policeman making the arrest, states:
"So far as I was able to judge, Brown was in a normal condition and conducted himself properly."
And Mrs. George Watson says:
"He was in a normal condition, and chatted and passed pleasantries with myself and husband in his usual cheery manner until the officers arrived."

Still another quotation reads:
From the jail I was taken to ward X, the jail ward at Vancouver general hospital. I knew Dr. Ansley Seymour, intern of the hospital, so sent for him to come down, and through him I got hold of Dr. B. D. Gillies, who came to see me.
Dr. Gillies righted matters at once, and I was returned to Shaughnessy, but my clothes were taken from me. Instead of acting reasonably, the Shaughnessy end only intensified matters.
And again:
A couple of days later the doctor brought to my bedside legal papers to separate me from my wife- and making over to her all our assets-which he ordered me to sign. I refused. Next morning two orderlies escorted me down to the doctor's office where he had a lawyer to enforce my signature. This lawyer, a splendid chap, Mr. Herb Drost, upon my explanation dropped the matter at once. In a written statement over his signature concerning the events, which he certifies as taking place February 8, 1927, he states, speaking of myself:
"He did appear a little excited, due perhaps to the fact, as he explained, that his clothing had been taken from him so that he could not leave the hospital, and he was not permitted to reach friends even by telephone. But I must say that during my whole interview with him he did not show any indication of what I would term insanity or mental derangement of any nature."
On February 9, the next day, I was sent to Essondale for incarceration, the date being certified in a document signed by H. G. Baxter, of the Shaughnessy staff. There I was, as a sane competent person, asked to sign legal papers one day, sent to the asylum the next. The late Chief Justice Auley Morrison, in commenting upon this point, stated very clearly to me that such a procedure would not hold good in any court of justice, if it were questioned.
It might be well to state here that I have some fifty-odd signed statements, some sworn to, and along the lines of the following letter from my then partner testifying as to my sane condition at that time:
"I have been closely associated with Mr. Stuart Brown for the past eighteen months, during which time we have worked together in the contracting business. In all this time I have found him an agreeable companion and a keen business associate, and I am altogether at a loss to understand on what grounds a board of doctors could pronounce him insane or in any way a fit subject for incarceration at Essondale."
"I may say that while he was at Essondale I had occasion to transact business with him, and again also during the period of his so-called escape from there, and at all times found him normal. In short, to me it is almost incredible that a man who is able to take his place in the world and earn his living in a normal manner could ever find himself in the predicament that Mr. Brown was in during the summer of 1928."


Mr. Fournier (Maisonneuve-Rosemont):: Hear, hear.


John Horne Blackmore: I hope that Hansard will record the name of the member who has called "hear, hear". It will be good reading for the people of Canada when they see how seriously Liberals take crimes of this kind. The hon. member ought to have one of his own brothers in this kind of fix. He cannot

forget politics long enough to appreciate the misfortunes of anybody else. I read on:
"In conclusion may I reiterate that I have been closely associated with Mr. Brown for the past eighteen months, and would welcome an opportunity to testify under oath that during the whole of the period I have found his behaviour entirely natural and normal.
That is signed by Charles Saunders. I continue to read from the article:
Among these credentials are some pretty well known figures: Mr. J. R. Waghorn, head of the previously named firm; his manager, R. P. Burr, and his chief clerk, G. R. Riley: Valentine Quinn, vicepresident, Pacific Coast Terminals; hospital patients; all of my immediate neighbours, and a lot of others with whom I was in contact, all certifying my sane condition. As I said, some fifty testimonials.
A Legion committee found that in the records there is a statement to the effect that I had been in an asylum prior to the war-an absurd statement, and entirely untrue, and so attested by sworn documents by every member of my family, and George H. Cowan and Sydney B. Woods, both K.C.'s.
On the committal papers the Legion found also a statement that I had been arrested and charged with an offence against children. This is entirely untrue. No such occurrence ever took place, neither the offence nor a police charge. Questioned and asked for proof, the pensions doctor was forced to acknowledge to the Legion that there was no proof in existence. This may make it evident that a doctor may write any statement he likes into a committal document. Please keep in mind that these statements have not got to be sworn.
I do not desire to delay the house unduly with this matter at this late period in the session. If the people whom I have the honour to represent see fit to send me back to the house, I shall go on with this matter when parliament reassembles. One year ago I would not have believed that it would be possible in Canada for a returned soldier to be railroaded into an insane asylum and kept there for years and years. I would not have believed that the monstrous outrages that were obviously committed against this man could possibly be committed, and I would not have believed that the authorities of Canada would allow such a condition to stand unpunished and unrectified.
Here we have evidence that is beyond question. I realize that a number of the members of the house are deeply interested in this matter. I wish to appeal to the newspapers of this country, who have the power to give publicity or withhold it, and I wish to appeal to the people generally to give careful consideration to the case of Stuart Brown, and the case of Thomas Harvey which I have already brought before the house.
Let us remember that in the war which is coming any one of their boys, their own brothers, can be in the unspeakable position of Stuart Brown and Thomas Harvey. As I said last night, almost the first thing that Thomas Harvey told me was that in the insane asylum in which he had been incar-
The Budget-Mr. Black-more cerated there was another man who had been there for twenty-five years, though he was absolutely sane-a prisoner serving penal servitude with no crime against him. Surely this state of affairs is so terrible that it cannot be allowed to continue.
I wish to make one or two comments. Probably the Minister of Veterans Affairs (Mr. Gregg) will make a statement, but he may not be ready to do so at the present time. If he is returned, and his government is returned, no doubt he will clear up situations of this kind.
There are two or three things I wish to say in addition to what I have already said. My information is that the story which appeared in the Vancouver Sun was submitted to that paper in August, 1948, and from that time until January, 1949, the date of publication, was investigated by it from every angle before it would publish the article. It would appear, therefore, that the article is completely reliable.
I have on my desk two communications which came to me directly from Stuart Brown. According to his latest letter to me, Stuart Brown is now in Shaughnessy hospital recovering from a broken hip. He is now sixty-seven years old. His life has been ruined-ruined by the Department of Veterans Affairs of Canada, the nation he served in war. His home was destroyed, his children alienated from him, his wife alienated from him, his business reputation destroyed. He stands on the record as a criminal, for crimes never committed. He is still accused of insanity, which has never been established and cannot be established. Yet nothing is done about it by anyone in Canada. Surely the very stones on the street would scream out against such outrages.
In addition to what I have said I have a copy of the submission made by the provincial command of the Canadian Legion dealing with this case.
Let me make this general remark concerning our veterans. It is frequently urged that the departmental officials have to be extremely strict in order to avoid being imposed upon by veterans attempting to "swing the lead," to use a common expression in the army. I will grant that a good many men abuse the privileges which are theirs. I will grant that precautions must be taken against what is called swinging the lead. My experience in dealing with veterans has not been as extensive as it might have been, but it has led me to fear that far too much injustice is visited upon fully deserving soldiers in order to avoid favouring people who might be "swinging the lead." I should say it would be better to humour six veterans

The Budget-Mr. Boucher who were actually swinging the lead than to neglect one veteran who is in actual want.
I make that statement from the barest, purest sort of materialistic point of view. We have fought two wars within the memory of most hon. members of this house. We are going to fight another one, and perhaps still another; certainly we must fight the one coming up. In the midst of war or preparing for war the finest asset any nation can possibly have is a feeling of implicit confidence in the hearts of those who will be called upon to make sacrifices in the war, the parents of the soldiers, and the soldiers themselves. By such things as I have recounted we are destroying in the hearts of our people the confidence we shall need most urgently one of these days. We are going to find ourselves in a position similar to that of the boy who, in the story familiar to all, called, "Wolf! wolf!" until his friends got so used to hearing him that when the wolf finally came they left the boy and he was destroyed.
I hope we do not destroy the morale and confidence of our people by such things as I have come in contact with in our treatment of veterans. I fear we are neglecting six veterans in actual need in order to catch one veteran who may be trying to swing the lead.
Now, Mr. Speaker, I shall leave this case on the doorstep of the government and on the doorstep of the Canadian people as a whole, the responsible people whose behaviour will decide whether or not this nation shall continue to survive.


Mr. William A. Boucher (Rosihern):: Mr. Speaker, my first words in this debate and indeed my first words in this house must be to express my warm appreciation to the electors of my constituency for the honour and privilege they have given me of representing in this house the constituency of Rosthern. Some of the oldest settlements in Saskatchewan are to be found there. Fish Creek and Batoche are names that have a familiar ring to those who have read some of the history of our Canadian northwest. In the early eighties our pioneers came from many parts of Canada. Some years later they were followed by immigrants from many countries of the world, who settled down in that happy corner of Saskatchewan to become Canadians. Adopting the spirit of our first Canadian settlers, they laboured incessantly, receiving and giving all possible co-operation in the building of homes and communities, and adding the advantages of their culture to the development of what we are proud to call our Canadian way of life. This population, transplanted from many lands, has proved a most important asset not only to Rosthern and Saskatchewan but to the whole of Canada. [Mr. Blackmore.l
More thrifty, more sincere and more co-operative Canadians cannot be found today in any part of our land.
Before the turn of the century, in 1896 to be exact, part of what is now Rosthern elected Wilfrid Laurier as its representative. Thirty years later the same constituency elected his successor to the leadership of the Liberal party, the right hon. member for Glengarry (Mr. Mackenzie King), so he could continue his unrelenting efforts for the Canadian people. It is the earnest wish of the people of my constituency that in their name I should pay tribute to this great statesman, who continues to give this house the benefit of his wisdom and experience.
The people of the constituency of Rosthern are proud of the ability, sincerity and devotion to Canadian affairs shown by the man who is now Prime Minister (Mr. St. Laurent). Most hon. members had occasion to know him while he held office as Secretary of State for External Affairs and Minister of Justice. In the short time during which he has held the reins of this administration the progress of our country's affairs has continued without interference or interruption. The continued competence of the government, the increasing prosperity of our nation and his great humanitarian outlook have gained him our confidence and I am sure the complete confidence of the Canadian people. Those of the west have given a warm demonstration of this confidence during the last two or three weeks.
The people of Canada placed their confidence in the Liberal government in 1945. I am pleased to say, Mr. Speaker, that since that time my own constituency has given proof of its continued confidence in the present government, by giving the Liberal party one of the largest majorities it has ever received in the history of Rosthern. My predecessor as member, Mr. Walter Tucker, as you know is a very able and competent man. He was a big man here in Ottawa; he is a big man in Saskatchewan. We have high hopes for him in our province; and I venture the prediction that we will hear a great deal more of him in the not too distant future. I realize that my task in replacing him is a very difficult one. I have, however, pledged myself to do my best to follow his example. The people of my constituency expressed confidence that I could do that to their satisfaction and it will be my earnest endeavour in this house to fulfil their wishes.
Mr. Speaker, I should like to congratulate the Minister of Finance (Mr. Abbott) on the ability he displayed in discharging his responsibility when placing before this house the budget which we are now called upon to approve. It has been the lot of this country's

Minister of Finance in the last few years to propose some measures which did not make him popular with what is sometimes called "the little man" in this country. It is obvious now that the great majority of our people have readmitted our Minister of Finance to their affections. Some politicians will naturally draw far-fetched conclusions and, in a very loud voice, level some criticism at this year's budget. It is my belief that those politicians who criticize are not by any means the best judges of the question. The people of Canada who earn their living by labour in industry and by working on their farms-one must admit there are many more of them than there are politicians-are the ones to say whether or not they like it. I am convinced, Mr. Speaker, that the great majority of Canadians approve this budget.
Some hon. gentlemen from the other side of the house have maintained, and still try to maintain, that in this instance the majority has been bribed. Such a contention is utterly ridiculous. So long as we uphold our democratic system, and I am sure it is not the wish of any members across the floor of this house to see the system destroyed, so long as we believe in that system and believe that our people are not susceptible to bribery, then we shall have faith in their judgment. I am sure the members on the other side of the house will find this out for themselves as soon as, in our democratic way, our people are asked to write their verdict on a ballot.
The budget which is now before the house is a logical development of the sound financial policy that has been pursued by the present administration during the last war, in the immediate post-war years and in these postreconversion years. During the war the pay-as-you-go policy enforced by this government met with general approval. In the post-war years, although the taxpayers of this country would have welcomed some relief from the burden of taxation that remained on their shoulders, they readily understood that this nation's debt had to be reduced as much as possible. The immediate reduction of taxes would mean the maintenance of our debt and interest charges, encourage inflation and, in the end, would result in no relief at all. The careful administration of our fiscal structure paved the way for the more considerable reductions that are now proposed.
The record of national debt reduction since 1945 is one of which we should be proud and for which the members of the present government should be commended, because it is one of the important factors that make the present tax reductions possible. The soundness of the fiscal policies put into effect by this government is attested to by the continued prosperity of Canada as shown in the white paper tabled by the hon. Minister of
The Budget-Mr. Boucher Finance. Our gross national production, gross national income and our employment figures during the course of the last year were higher than ever before in our history and higher than could have been expected a few short years ago. Put in terms of fair prices for farm products, work and wages for our people, it means a greater degree of prosperity and happiness than we have enjoyed in the past.
The present government has pledged itself to maintain this prosperity and that is one of the important reasons why I pledged my strongest support to it. So far Liberal policies have succeeded, and I foresee that they will bring us more progress in the next few years. The reduction of taxes this year will have the effect of furthering this prosperity because it will more firmly establish the prosperity of the farmer. This government is fully aware of the fact that Canada is prosperous only when the Canadian farmer is prosperous. Our experience under a Tory government from 1930 to 1935 proved that. The Liberal government fully realizes, as it should, that the welfare of agriculture is, and will continue to be, absolutely essential to the proper functioning of our economic machinery.
The most important industry in the constituency I represent is, of course, agriculture. The wheat grown in Rosthern is second to none in the world. Improvements in agricultural methods and fair returns for our nroduct are properly our main concern. Through the agency of the Canadian wheat board we farmers have been helped tremendously in the marketing of our products at fair prices. The increase of twenty cents a bushel announced in this house by the Minister of Trade and Commerce (Mr. Howe) some weeks ago will have a considerable effect on the maintenance of prosperous conditions in Canada. We realize all the benefits we derive from the Canadian wheat board. We uphold it one hundred per cent.
The farmers of western Canada have recently been watching the grain markets very closely. They have not forgotten the experience of the past when markets were lost in spite of attempts and claims that we could "blast our way into the markets of the world". They know that markets cannot be gained or retained by "blasting". For this reason I, and I believe the great majority of the farmers in the prairie provinces, are solidly behind what has come to be known in our province as the Gardiner policy of long-term contracts. When we look at our present prosperity and remember what the so-called open market did to us in the past, it is impossible to make any sensible farmer believe that he has really lost money through
2580 .

The Budget-Mr. Boucher the policy of marketing wheat through the wheat board by long-term contracts with our best customer, the United Kingdom. Again, we are one hundred per cent behind the wheat marketing policies of this government which include the long-term agreements and the activities of the Canadian wheat board.
Farmers and the businessmen also of the prairie provinces of western Canada remember well their experiences under a Conservative government from 1930 to 1935. You can be sure that we are not going to take any chances on going back to those conditions. For this reason I, and I am sure all the electors of Rosthern constituency, support the Liberal policy of floor prices under farm products. The Canadian farmer's service to the country in the past has earned him this security as a matter of right. It is one of a number of social security measures of this government that guarantee us freedom from the spectre of depression that the C.C.F. opposition like to talk about so much. Sometimes they even appear to be hoping for one, because they think it would bring them into power. It is one of a number of measures that have an important bearing on the financial position of our country and of our people.
Another of these measures that we in Rosthern constituency support wholeheartedly is the great expansion of prairie farm rehabilitation, namely, irrigation, and the extension of the principles of this project to all of Canada, brought in by the Liberal government. It is one of the reasons why more and more of our people are turning to liberalism. It is another guarantee of freedom from fear and from want, and I stand solidly behind the government in this great activity.
The Prairie Farm Assistance Act has beer of inestimable value to the economy of the prairie provinces, and indirectly to the whole of Canada. It is far in advance of anything ever suggested by the parties in opposition who criticize this government's policies. While socialism offers only to ration poverty and want, Liberal policy has given security and preserved-


Some hon. Members:: Order.


The Acting Speaker (Mr. Golding):: Order.


Mr. Harris (Danforth):: I am sorry to interrupt a new member, Mr. Speaker, but-


William Albert Boucher: I am making my maiden speech and I object to being interrupted. If the hon. member wants to ask a question after I am through it will be all right.


Some hon. Members:: A point of order is being raised.


Some hon. Members:: Carry on.


Mr. Casselman:: Don't read the dirty parts.


Joseph William Burton: You have now lost your place.


Sarto Fournier: trust that will be the only thing you will lose.


William Albert Boucher: These fellows can talk but none of them will be back at the next session. May I repeat the paragraph, Mr. Speaker? The Prairie Farm Assistance Act has already been of inestimable value to the economy of the prairie provinces, and indirectly to the whole of Canada. It is far in advance of anything ever suggested by the parties in opposition who criticize this government's policies. While socialism offers only to ration poverty and want, Liberal policy has given security and preserved a high measure of prosperity to the farmers, and indirectly to all of the people in our prairie provinces. This act is being still further improved and will be supported by the electors of Rosthern.
Everybody knows the policies of the Liberal party with respect to our older citizens. These pension policies were outlined in the proposals made to the provincial governments in 1945. While we remember that this comes within the jurisdiction of the provincial governments-it is administered by them-we of Rosthern constituency strongly urge that every support should be given toward a more substantial and contributory old age pension to commence at an earlier age than is now in force.
And we must not forget the part that family allowances-an act of this Libera] government-have played in the financial stability and prosperity of our country. They were first proposed by the Liberal government. They have been criticized often and unfairly by the opposition, but I would dare any hon. member of the opposition to carry his criticism to the point of voting against them.
When I speak of the social security measures of this Liberal government that have maintained progress and prosperity in our land, I realize that this prosperity for our people can only be built on the foundation of peace and security. For this reason, Mr. Speaker, I strongly approve of the courageous action of this government in promoting and signing the agreement which is called the Atlantic pact. I am sure that the electors of Rosthern-because they know how two great world wars were forced upon them-are unanimously in favour of the agreement for collective security. In the past the democratic nations fell into war because they allowed themselves to be divided. Now we hope to stand in peace by this act of unity. I know that the C.C.F., the socialist party of one province, has declared itself

against this pact. I do not believe that their stand is in the best interests of peace for Canada, or for the world.
It is only on this foundation of peace and security that we can continue to build the progress toward prosperity and happiness that is our lot in Canada today. The people of Canada do not need to be told by figures in the budget speech that they are better off under the policies of this Liberal government than they have ever been under the government, or the policies, of any other party. They know it by their own financial position, by the money that they have in their pockets, and by their freedom from unpayable debt. It is by their own individual prosperity and happiness that labour in Canada knows that employment in eight leading industries in Canada has doubled in less than ten years from 1,182,000 in 1939 to 1,871,000 in 1945, when the war ended, and to 2,031,000 in 1948.
Labour in Canada will not be misled into socialism by false leaders, because they know that 3,227,000 of them had work under Liberal policies in 1948, an increase of 80 per cent over the number employed when the government came into power in 1935, an increase that came gradually year by year since that time, and which has continued to increase since the war ended. The promise made in 1945 that Liberal policies would create jobs has been kept in full. On February 17 of this year the Canadian Press reported that the prairie provinces of Canada had established a world record of employment. The greatest possible social security is jobs and fair prices. These are the things which give independence and security, and which contribute more to human happiness and prosperity than do all the utopian promises of socialism. The people of Canada do not need to be told of the almost fabulous figures of her world trade- that she is the third largest trading nation in the world and, based on population, by far the greatest trading nation. They know it by the money in their pockets obtained from honest labour, given because they have jobs and fair prices for the products of their labour on the farms.
They know, too, that the policies which gave them prosperity are the policies to retain. No one can tell the wheat farmer of the prairie provinces that he has suffered from the policies of this government. He knows those policies are right, because of the money they put in his pocket.
In western Canada we have had the ridiculous spectacle of politicians who claim to support the policies of the Minister of Agriculture (Mr. Gardiner), of whom Saskatchewan is justly proud, and yet who in every way try to defeat the minister. By the state-
The Budget-Mr. Boucher ment of a highly respected judge we know that in the election of 1945 an attempt was made by those who opposed him illegally to defeat the minister at the polls. At that election he was opposed only by the C.C.F., the socialist party.
The farmers of the prairie provinces know that if the Minister of Agriculture were defeated his policies, which have helped them so much, would lack the support they need. That is why we find an increasing number of farmers, and of people whose prosperity depends upon the farmers, determined that they are going to send to Ottawa at the next election a delegation solidly supporting the Minister of Agriculture and the Liberal policies he follows.
Mr. Speaker, the electors of my riding strongly support the budget, because it provides for the biggest tax reductions ever proposed by any Canadian government. They support the budget because these reductions were effected in both direct and indirect taxes; and, even more important, tax cuts were directed to the masses of our people, particularly those with growing families.
The 770,000 people in Canada taken off the income tax rolls do not need to be told that for them this is a good budget; they know that, by the extra money in their pockets. They know, too, that the reduction of public debt shown in the budget means that further tax reductions are going to come if the Liberal policies of sound financial administration are continued.
I believe the trans-Canada highway should be built without further delay. I believe further that the route selected in Saskatchewan should be located in the centre of the province, following the Evergreen highway which passes through Saskatoon, Edmonton and Yellowhead. This route is unsurpassed in scenic beauty. We need an artery running from the trans-Canada highway to the United States boundary and to the Prince Albert national park.
Recently one of our distinguished sons of Canada wrote a book entitled "On Being Canadian". The people of Rosthern constituency take second place to no others in this great country in their loyalty and devotion to our country and our way of life. There is a reason why many of the citizens in Rosthern appreciate even more than others the privileges and responsibility of Canadian citizenship.
As I said at the outset of my remarks, our people came from many parts of the world; some came from places where they lived under strict controls and autocratic rule. Therefore many of these people are in a better position than others would be to appreciate the freedom and the opportunities

The Budget-Mr. Boucher in Canada. They have not been beguiled by the false and siren promises of socialism or any other ism. That is why I am sure the people of Rosthern constituency stand solidly behind the budget, one which they know is designed to maintain for all our people the independence, the prosperity and happiness that Canada offers under Liberal policies.
(Translation):
Upon this first occasion which is afforded me to address the members of this honourable house, I wish to express my appreciation for the honour and privilege of representing the constituency of Rosthern here in Ottawa. The first inhabitants of Saskatchewan settled in Rosthern. Those who have already read the history of northwestern Canada are familiar with the names of such places as Fish Creek and Batoche which are located in Rosthern. As early as 1880, our ancestors came to Rosthern from all parts of Canada. A few years later they were joined by numerous immigrants from several European countries, who lost no time in acquiring the spirit of the Canadian pioneers. These newcomers played a most decisive part in the building of our cities and towns, in the development of our country and of our way of life. These people from foreign lands have proved a most valuable asset not only to Rosthern and Saskatchewan but to the whole of Canada. Today, there can be found no Canadians who are more thrifty, more sincere and more convinced of the necessity of co-operating with their fellow citizens.
In 1896, a portion of what is today the constituency of Rosthern had the honour of electing Sir Wilfrid Laurier as its representative in Ottawa. Thirty years later, that same riding elected the Right Hon. Mr. Mackenzie King, now member for Glengarry, as its representative in the dominion parliament, thus enabling him to continue his efforts towards the development of this country and the improvement of the living conditions of the people. On behalf of my electors I welcome this opportunity of paying tribute to the former prime minister of Canada.
The outstanding statesmanlike qualities of the present Prime Minister (Mr. St. Laurent) are recognized by the people at large just as they are by the members of this house who have been in a position to appreciate them when he was in charge of the Department of External Affairs and of the Department of Justice. Since he assumed the leadership of the government, a few months ago, the Canadian people have also been able to know him better. The continued progress which we enjoy and the ability of the present govern-


ment have gained him our full confidence and that of the Canadian people.
One of the first opportunities of showing that confidence was afforded to the electors of my constituency, and the majority given to the present government in that by-election was one of the largest ever obtained by a Liberal government in Rosthern.
(Text):


Mr. W. Garfield Case (Grey North):: Mr. Speaker, I think one of the most important statements that have been made in this House of Commons during the time I have been privileged to be here was the statement by the Prime Minister (Mr. St. Laurent) at closing time yesterday. I think he has alerted himself to the desires of the people during his trip through the west. Upon his return he is quoted as saying in effect that he found a desire for a general election.
In the main you do not find a desire of that type if the people are satisfied. I think the right hon. gentleman sensed the feeling of unrest and uncertainty which is present today in the minds of the Canadian people and in the minds of many Liberals as well. While I do not think it is a good thing to thresh old straw, after listening to the hon. member for Rosthern (Mr. Boucher) I think I should attempt to refresh his memory for the benefit of those who will verify the statement I make.
I should like to remind the hon. gentleman that in 1930 we were approaching a situation which the Prime Minister of that day, the present right hon. member for Glengarry (Mr. Mackenzie King), hesitated to face even though he had another year to serve before his term of office expired. As the right hon. Minister of Agriculture (Mr. Gardiner) remarked when dealing with his estimates, in 1929 they appreciated that a terrific financial and physical collapse was on the way which was beyond their ability to cope with.
The man who was called into office was forced to face all kinds of criticism but he led this country through a great economic disaster, an economic disaster that faced not only this country but the entire world. My hon. friends know that. It is unfair and unjust to place the responsibility upon the one man who at the risk of his health did a great job for Canada in keeping this country on a reasonably level keel at a time when the banks of the United States were closed down and economic chaos was rampant and the government was hard pressed to cope with a situation which might easily have resulted in mob rule.
In distant Europe the situation was even worse and the totalitarian states turned their attention to the manufacture of implements of war in order to stabilize employment for

the time being. However, in building up a huge war machine they led the world to the brink of disaster which resulted in a terrific and costly war.
Let me remind the hon. gentleman who has just taken his seat that as late as 1938 thousands of young men walked the streets of Canada without a place to lay their weary heads. They rode the rods from one city to another. I met a young man who enlisted in the early days of the war in 1939 and who told me that his army pay was the first pay he had had for a period of four years. I have considerable regard for the efforts the government made, but I must say that had it not been for the war it is most questionable whether they would have solved the economic problems of Canada.
I have discovered no tendency that would indicate that Liberalism is on the march. No major change or reform has been brought about to ease the burdens of the Canadian people. Reference has been made to the budget and the hon. member for Rosthern has said that they have made the greatest tax reductions in history. If you build up your pyramid high enough, and they built it to the highest peak ever known in the history of Canada, it is not too difficult to cut it down, particularly when there is an election in the offing. It was necessary for them to do something immediately because the country was demanding it. Hon. members on the government side rose in their places and insisted that the Minister of Finance (Mr. Abbott) make some adjustments in taxation.
They reached out and they did quite a job, but as far as I am concerned, it is too little and certainly far too late. There should have been gradual reductions in taxation during the period of adjustment which would have encouraged greater production and thus defeated this spiral of inflation. We must remember that living costs in Canada have soared. In fact we are the victims of inflation brought about as the result of policies deliberately put into effect by the present administration.
After listening to the hon. gentleman who preceded me I begin to think that the present administration is suffering from an inflationary trend. They are suffering from egotistical inflation and the electors are presently going to puncture the bubble and there will be very little left when all the gas has been let out. You hear people in this House of Commons and on the hustings encouraging people to believe that this old supreme authority known as the present administration is giving handouts to the people in the way of family allowances, cuts in taxation, millions to wheat growers and reductions in income tax. It is
The Budget-Mr. Case
well timed; of course it is well timed, but they are not giving the people one red cent that the people themselves did not provide. I think it is important to bear that in mind. Governments have no money; they are dependent entirely upon the taxpayers of the nation, and the ability of the taxpayers to produce the necessary revenue depends entirely upon the productive capacity and employment of the nation.
Today we have our efforts in the House of Commons highlighted by the fact that the government, faced with a non-confidence motion in the present administration and having been sustained by a very narrow margin when the house divided on the speech from the throne, rather than risk outright defeat are going to deny to the members of the house the privilege of criticizing their policies and condemning them in this legislative chamber. They are now going to seek an opinion from the highest court in the land by going to the country.
What does this mean? It means that there was called into being the public accounts committee. We had the Auditor General before that committee for one day when he referred to some of the things which he had criticized in his annual report to parliament. Subsequently my leader, the hon. member for Carleton (Mr. Drew), was made a member of that committee. I am wondering now if the Liberal government have not decided that they have almost had enough and are willing to hightail it for the tall timbers, or anywhere else they can seek refuge, and watch the show go by. Certainly they have arrived at the place where they fear and dread criticism.
I heard one member this afternoon speak about freedom from fear. I think if the Prime Minister (Mr. St. Laurent) could inculcate a little of that freedom from fear into those who sit with him in the administration they would not be inclined to whistle in the dark hoping against hope that everything will turn out all right when they know they have been masters of mismanagement and that the country is going to have to pay a terrific price. References were made to the trying days of the early thirties. It must be remembered that a Conservative administration took over then following long years of Liberal rule and administration, and the same situation prevails today when the Liberals have been in office for fourteen years.
The country has survived a war when the entire effort of our people was required for a common objective. We have now had brought before parliament a charter or pact known as the Atlantic pact which we debated previously in a very limited way and passed almost unanimously. Since then the final draft has been signed in Washington, and I

The Budget-Mr. Case
understand it will be returned to this house for further debate and comment. We find the government exactly in the same position that they were in in 1945, long on showmanship and certainly short on practicability. In 1945 the then Prime Minister flew to San Francisco to affix his name to the United Nations pact. Today they have signed the Atlantic pact, which is an instrument to guarantee the security we all seek, and by which we hope to avoid war.
This government, however, has not the courage to come forward with any policy. No doubt when the pact is returned to the house the debate will be restricted. While we have made commitments we are absolutely without any policy or sense of direction to help us to determine how we intend to honour our obligation. I think it is most unfortunate that the country should be left in such a situation, having become a signatory to a pact, having enjoyed all the glory and showmanship which went with it, and all the publicity which was necessary to indicate that we too were among the 330 million people in the world who desired this token of security. We have not yet determined, however, the method we intend to employ to guarantee that security.
If you read the daily press at the present time you will find that a very important conference is taking place in old London. It is being attended by the Prime Ministers from various parts of the great commonwealth. Is Canada represented by her Prime Minister at that important conference of members of the British commonwealth of nations? No. She is represented by a second in command. Someone who could not possibly speak with the same authority as the Prime Minister is offering Canada's advice. It is a very important conference, possibly more important than we realize. For some reason or other there has been a tendency on the part of this administration-and I am not going to charge them with ulterior motives in any sense of the word-to by-pass these imperial or commonwealth conferences. Yet I think it must be admitted by all who are students of history that the greatest security we enjoy, and the greatest security we are likely to enjoy, is that of being a member of the commonwealth of British nations within the British empire. I am one who regrets therefore that the Prime Minister is not representing Canada at this important conference in old London.
I said a while ago that some of the funds which the government is distributing were raised by taxation. The funds which are being returned to the wheat growers are funds which originate from the sale of their product, and from no other source. Yet these

cheques are going to find their way to the western plains at a very important moment, at a time when an election is under way. I was privileged to visit the province of Saskatchewan recently. There is an air of concern and uncertainty there as to the climatic conditions in that great province at the present moment. Therefore I feel that the time has arrived when greater consideration must be given to some means of surveying the land, not alone by way of the Prairie Farm Assistance Act, but through some other instrument of legislation, and those lands that are subject to repeated failures should surely be classified in some way, or put back into grass and returned to grazing land.
Those are problems which might well be dealt with if the government had any desire to solve anything. Possibly we should agree with them, however, that the first thing they had better solve is their own position, because it would be unfortunate if they laboured hard and long only to go to the country and meet the fate which I am sure they are going to meet. Rather it is just as well for them to hand over the reins now while there is some semblance of saving their face.


Mr. Grant:: While there are a few Tories over there.


Wilfrid Garfield Case: There will be a lot more Tories over on your side when the game is over. Not only have we a public accounts committee, but there is also a very important committee of this house on which I had the honour to serve. I refer to the Indian affairs committee which was a special committee of the House of Commons. A royal commission consisting of ten members of parliament was set up to travel throughout the maritimes, at considerable expense to the taxpayers of Canada. They laboured hard and long to revise the old Indian Act which has received no major attention since 1867, the year of confederation. Representations were made to this committee by Indian tribes and Indian agents from one end of Canada to the other. The labours of the committee extended over a period of three years. Great volumes of evidence were heard. These were sifted through, and as a final act we met and agreed almost unanimously, which very seldom happens when you have a committee composed of so many members, and also having on it representatives from the other place. There was very little dissension, if any; and what there was I am sure would have been straightened out on the floor of the house. Now after all this work and preparation and the drafting of this important legislation, the government has seen fit to abandon the whole thing and throw it overboard. The Indian affairs committee was not even set up this

session. It was represented that the bill was being studied by the law officers of the crown, but I have been unable to find any substantial evidence to that effect. So the work carried on by a joint committee of members of this house and the other place for three long years, at considerable inconvenience and expense and involving a good deal of travel, is going to be discarded and the recommendations of the committee completely ignored.
I do not think that is a fair way to treat a minority, whose ancestors were the original citizens of this great land. They placed all their hopes in this committee. They were the first to ask that it be set up, through the North American Indian brotherhood and other similar organizations. They made representations to the government asking that such a committee be set up, and it required long years of approach and much planning on their part to get this far. Now this is to be discarded because, as I have said, it suits the government to avoid facing the criticism of their colleagues in this house. They prefer to go out with their propaganda machine well oiled and try to convince the Canadian people that they have been carrying on by some divine right all through these years and have passed legislation for the common good, though we who have had the experience of sitting in this chamber know full well how important it is to have criticism as well. It is the criticism they are trying to avoid at the present time.
The hon. member for Rosthern (Mr. Boucher) also mentioned the trans-Canada highway. I can assure you, Mr. Speaker, that this great project will receive a good deal of attention after the election has determined who will sit on the treasury benches. We have definitely made it a part of our program. The government were quick to seize upon some semblance of our resolution immediately following our national convention, but they have given a very poor exhibition of leadership and I am quite satisfied that nothing will be done. This is the do-nothing administration, except for the collection of large sums of money, which is carried on with a degree of inefficiency which is very costly to the taxpayers. When we ask the Minister of Finance (Mr. Abbott), "What about this item of $374 million in connection with the foreign exchange control board?" his answer is, "Oh, that is just a bookkeeping item." Well, I can tell you that the taxpayers of Canada have found it a pretty costly method of bookkeeping, because they have had to foot the bill for many years.
Another very important committee we would like to have seen functioning is the radio committee, which I am sure must mean a great deal not only to the government and to this house but to the Canadian people as well. We should have had an opportunity to delve into the policies under which our radio
The Budget-Mr. Case
broadcasting is carried on, and should have had an opportunity to recommend certain changes in administration. To me it seems absolutely ridiculous that a broadcasting commission with over-all authority to operate a broadcasting service on its own behalf, or on behalf of the government, at the same time should sit in judgment and have considerable administrative power over its competitors. It would seem just as logical to ask the board of directors of the Canadian National Railways to determine how the administration of the Canadian Pacific Railway should be carried on. For some time my thought has been that the government certainly should have a commission or some body similar to the transport commissioners, which would act in an administrative or advisory capacity, fixing rates and determining certain aspects in the public interest; but why we should expect the radio commission, itself in business, to direct the affairs of private radio enterprise is beyond me.
So these important committees, as well as the approach of private members to legislative problems, bills and other things, will be simply thrown into the discard and we will be on our way to the country. I believe the administration have been divided on this issue for some time; yet after our recent experience in getting through $100 million of supplementary estimates I can appreciate why they would hesitate before attempting to put through $2,300 million of estimates for 1949-50. So they are going to shelve all this and have an election.
Now for a few moments I am going to deal with an item which I believe should be stressed because of certain references we hear, particularly from our socialist friends, to the enormous profits which have been made by capital. 1 think we should all seek to have some appreciation of the part to be played by both labour and capital; and no good purpose will be served by endeavouring to divide these groups or drive them further apart. Anyone who hopes to succeed in bringing about understanding and stability in labour relations must bring these two great factions closer together, in greater appreciation one of the other. Recently I had an opportunity to see a set of figures which I am going to read into the record, together with such comments as I may have to offer. They are very revealing, since they mark a period of great progress in the industrial development of this nation. I am going back almost sixty years to point out that in 1890 the earnings per worker amounted to $272 per year. He received, however, 21-4 per cent of the product he produced. It is interesting to note that in 1945 the worker received

The Budget-Mr. Case
22-3 per cent of the product produced, an increase of less than one per cent. That seems astounding, because you may say, "Well, look at the tremendous expansion in the volume of wages." This is what actually took place. In 1890 the worker produced goods worth $1,271. In 1945 he produced goods worth $7,371; so while the percentage of the product he received increased by less than one per cent, the amount he received was $1,649 as compared with $272 in 1890.
How did these changes take place? Capital invested billions of dollars in better machines, tools and equipment with which the worker could work. Working conditions and the whole environment of the worker changed. Whereas in 1890 wages and salaries amounted to $100,415,350, in 1945 wages and salaries totaled $1,845,773,449 or an increase of approximately $1,745,338,000. This brings home to us that, in spite of the desire to stir up discord and misunderstanding between these two groups within our nation, capital and labour have made wonderful progress and labour has shared all the advantages which capital has sought to provide.
As a matter of fact, in pursuing this a little further I find that the dividends earned on capital are actually smaller now than they were in 1890, yet capital is benefiting by the greater volume of business. In 1945 industry expended $4,254 million more on raw material than in 1890. No wonder we now assess ourselves as being highly developed industrially. Facts and figures speak for themselves. Certainly there is plenty of evidence to indicate that Canada has traveled a long way in her industrial development. As a matter of fact, we have traveled farther than we would have traveled under any semblance of state control. Wherever it has been tried that has had a nullifying effect and has not been good for either the worker or capital. It brings into question the confidence of the investor in the future of the nation.
Canada has tremendous resources. We are greatly in need of foreign capital for our development. We must seek by every means we can to make it attractive for foreign capital to come into Canada and invest in our rich resources in order to ensure the development of those resources. We should also attempt to ensure their processing in Canada to the greatest degree in order that the benefits derived from that processing will reach our citizens.
We do find, Mr. Speaker, that capital is willing to risk itself in the development of enterprises such as mines and so forth. The fact remains, however, that capital will not risk a government which is not stable or a government of a socialistic character because

capital fears that once the enterprise becomes successful it will be seized by the government and taken over for the benefit of the state. So far as we are concerned we want to make sure the state remains the servant of the people and that it will offer the people a sense of security and confidence in the future. We do not want to arrive at a place where we are directed by some central authority; where we are under the influence of bureaucrats and subject to inspection; where there will be a degree of discord and misunderstanding. We much prefer, and I am sure the Canadian people who are resourceful prefer, not to be subject to that.
After all, Mr. Speaker, the greatest asset we possess is our people. We have reason to be proud of the robust citizenship of this great nation. Canada has made progress because she has had citizens who were willing to take a chance and who embraced no false philosophy. No one should claim that the country owes him a living, but we do say with all the emphasis we can that a country properly administered should guarantee every citizen the opportunity of making a living. The right to work is inherent in the life of any man. Productive toil leads to contentment and happiness more than any other method which can be employed.
I feel that we must always be conscious of our great Canadian citizenship. Our immigration policy should have as a fixed objective the bringing to Canada of people with initiative, who have a high regard for our laws and for our institutions. We should bring to Canada people who value freedom as the average Canadian should value freedom, though sometimes I doubt that there is a real appreciation of freedom. After all, we are very fortunate in that we have never been without our freedom. We know something of what oppression means by hearing about it from those who have been oppressed and who are seeking to escape from it. It is our hope for the future that Canada is going to remain a land of freedom, a land where individual initiative and individual ambition will count for a great deal. As we march forward to greater prosperity we must address ourselves to that important task, ever conscious of the fact that freedom is an empty farce if our people are not given some economic security.
We cannot join with our socialist friends whose leader is reported to have said that their hope of success is a major depression or recession. I would certainly not want to have that thought in my mind, that our only hope of climbing to power was on the wreck of humanity. So, Mr. Speaker, our objectives are clear. We are prepared to meet the issue and we are certainly in a position to assure

the Canadian people that we have within the ranks of our great party a wealth of talent and leadership that is capable of forming the next government of the Dominion of Canada. It is capable of giving this dominion the type of legislation it has long been seeking. We will cut the bonds which are holding us back. We will be rid of bureaucracy, government by order in council or by any such method as is now employed. There will be restored to this great, free parliament the right to govern itself and to make that contribution which is in the best interests of all concerned. Then, Canada will indeed be a land of democratic freedom, with all the emphasis we can place upon those important words in our vocabulary.


Mr. T. J. Bentley (Swift Current):: Mr. Speaker, I should like to congratulate the member from Rosthern (Mr. Boucher) on his maiden speech and the manner in which he delivered it. If it is ever the misfortune of the rest of the country-and his good fortune -to have him return here, which I doubt, he will no doubt do considerably better the next time. We in this group have no criticism to offer, Mr. Speaker, of the calling of an election at this time. We are very pleased. The date is agreeable to us. We believe it is time an election was called to give the people of this country an opportunity of saying what they want.
I am not going to brag about what will happen. We will allow the members from other parties to read the ballots and weep on the night of the twenty-seventh. I was interested, however, in the member for Rosthern's description of the Minister of Agriculture (Mr. Gardiner). If he had been a little more cognizant of the history of the last fifteen or twenty years; had he been a little less prejudiced, he would have realized that many of the things that he claims the minister stands for now, that same Minister of Agriculture opposed most bitterly within the very short memory of a great many people in western Canada.
He poses now as a great believer in orderly marketing. That same Minister of Agriculture made it very difficult for the farm organizations of western Canada, and the C.C.F. group in the House of Commons, finally to persuade him that the idea was good. And then having adopted the idea, the same hon. gentleman has been so piecemeal in introducing that type of legislation into this house that a great deal of the benefit that should have accrued has not come from it. The people have not been given the full benefit of what we believe is proper orderly marketing in order to receive parity prices. I may deal with that a little later.
The Budget-Mr. Bentley
Before going into the main reason for speaking in this budget debate, Mr. Speaker, I want to deal for a moment or two with this matter of marketing coarse grains, and all the controversy that has been going on since a little over a year ago when Bill No. 135, an amendment to the wheat board act, was introduced into this house. It will be remembered that one section of the act gives authority to the wheat board to handle oats or barley or oats and barley if it was considered necessary. I am sorry the Minister of Justice (Mr. Garson) is not in his seat, because at that time he was the premier of Manitoba. During his term of office there when Bill No. 135 was under discussion in this House of Commons, and when the Minister of Trade and Commerce (Mr. Howe) made it clear that Bill No. 135 would not be proclaimed unless the three prairie provincial governments each passed conjoint legislation to make it legal, the present Minister of Justice, at that time the premier of Manitoba, disputed most emphatically in correspondence with the Minister of Trade and Commerce the need for that legislation and the need for the legality of it. While I am not going to quote all these things today, I shall refer the house to sessional paper 110C, tabled during this session of parliament, containing that correspondence between these two gentlemen, and setting out very clearly the present Minister of Justice's disagreement with the actions of this government at the time that he was premier of Manitoba. Even today that hybrid government of Manitoba between the Liberals and the Tories, who have such glorious little squabbles in this house, but who get along so well out there, did not have the courage to bring in a government measure of that kind, but had to let it come in through a private member, and even then were compelled to accept it by the weight of opinion of the farmers of Manitoba.
Yesterday the hon. member for Lake Centre (Mr. Diefenbaker) asked a question in this house with regard to the matter. If I remember his words correctly-and he can correct me if I am wrong; they will be found in Hansard-his question was as follows:
In view of the fact that the legislature of Manitoba has joined the legislatures of Alberta and Saskatchewan in enacting complementary legislation in reference to the marketing of coarse grains, will the compulsory marketing of coarse grains now become automatic, or does the government intend to give further consideration to the question whether the course recommended by these legislatures will be carried into effect?
The question itself was worded in such terms as to indicate the innate caution of the hon. gentleman who asked it. He has been extremely cautious in his approach to this

The Budget-Mr. Bentley matter, knowing that his own convention last fall was very much against this type of legislation and finally adopted it only with the proviso that other types of marketing would also be allowed to exist along with it.
The minister replied to the hon. member for Lake Centre in these words, which will be found at page 2519 of Hansard:
The government set the prerequisite to the act being brought into force on two or three occasions. Apparently that prerequisite has been complied with.
Then note this:
The government will study the situation in the light of what has been said in the past.
Shortly after that the hon. member for Melfort (Mr. Wright) asked a supplementary question. It was unfortunate, Mr. Speaker, that the hon. member for Melfort did not get the floor first; but being farther away from the Speaker he was not recognized as early as the hon. member for Lake Centre, consequently his question could not get on Hansard as it should have, but it will get there today to indicate the difference in the tone, the difference in the sympathy toward this type of legislation between the question asked by the hon. member for Lake Centre and what would have been asked by the hon. member for Melfort. This is the question the hon. member for Melfort would have asked:
In view of the fact that the three western provinces have now passed the necessary complementary legislation to last year's Bill No. 135, and in view of the fact that the western farmers are now seeding, and the amount of coarse grain seeded will depend on the implementation of this act and the prices established under it, will the minister make a statement clarifying the position of the government and stating the 1949 prices for coarse grains?
That indicated on the part of the hon. member for Melfort a sincere desire to see the farmers themselves get the type of reply that would give them some guidance, some information to indicate to them in the management of their farms whether they should sow more or less coarse grains and which kind to sow. The minister replied in the same tone that he had used before. I want to remind the Minister of Trade and Commerce of one or two things. On several occasions in the past the Minister of Trade and Commerce has made statements about this matter. In 1948, as will be found at page 1678 of Hansard, the minister said:
The government is prepared to take whatever steps lie within its power to assist in establishing marketing arrangements that will help to maintain economic and stable prices for Canadian agricultural products. The government must, however, be satisfied that any given scheme for this purpose is . . . a practical one-
I have left out a few words, but any hon. member can look them up. I am not taking

anything out of the context; I am simply shortening things up. He said:
... a workable one and one that will command the support of the interested groups concerned.
In dealing with this matter this year the minister made a statement which is reported at page 1421 of Hansard. This was not in another debate, Mr. Speaker; it was an answer of the minister and therefore it is quite in order to quote it here. In giving the answer he had dealt with the matter of the Canadian Federation of Agriculture's representations to the government asking that this particular legislation be introduced. He had gone on to say why they could not do it in the way that the Canadian Federation of Agriculture wanted it done, and he pointed out that if the farmers did not like the way he was doing it they could make use of the bill that was going to be introduced by the Minister of Agriculture and which has since been disposed of, namely, Bill No. 82. He then finished up with these words:
If, on the other hand, the western producers wish to market their oats and barley through the Canadian wheat board, and provided that their provincial governments will enact the necessary legislation, this government's position has not changed since I introduced Bill 135 in response to specific requests then made by the farm organizations.
If that is not a clear indication of a promise, a definite undertaking to do a certain job when certain conditions had been met, I do not know what it is. From the time he introduced the bill he said that if the three prairie provinces passed conjoint legislation his government would instruct the wheat board to handle oats and barley. This is what he said yesterday in reply to the hon. member for Lake Centre:
The government will study the situation in the light of what has been said in the past.
What does the Minister of Trade and Commerce want? His conditions have been fulfilled. Everything he has asked for has been done. The people of the prairie provinces, by representations made to their own governments, have finally persuaded any of those governments which might have been reluctant that it was in their interest, and that they wanted this legislation. The minister has the legislation before him; and now he has the effrontery on the eve of an election to tell the House of Commons that the government is again going to give study to the situation. If I were inclined to use rough or profane language, I would ask, "What the hell more does the minister want?"


Some hon. Members:: Oh, oh.


Thomas John Bentley: I said that I would have said that, had it been allowed. I know of course that it is not allowed in the house.


Stanley Howard Knowles: Therefore you did not say it.


Thomas John Bentley: Coming to the budget, I should like to comment briefly on the remarks made last night by the hon. member for Vancouver North (Mr. Sinclair). About half way down the left-hand column on page 2559 of Hansard the hon. member is reported in these words:
Farm income is up from $1,300 per farm in 1939 to $3,800 per farm in 1948.
He omitted any reference to the cost of farm machinery, to the cost of lumber to build a house or to repair buildings; he omitted any mention whatsoever of the increased cost of living. But even had the cost of production and living remained the same as in 1939, it was still not out of line or out of order to increase farm income in this country on an average from $1,300 to $3,800 per year, because anyone who reads the figures produced by the bureau of statistics and by other organizations knows that these figures are not net to the farmer; these are gross income figures.
Anyone who brags about an increase from practically no income-$1,300-to $3,800 is not doing a service to agriculture in this country. He is a babe in the woods-


Mr. Sinclair:: The only point I made there was that the only standard by which these things could be judged is the fact that the average farm income between 1939 and 1948 has trebled. Everyone knows that the cost of living or the cost of agricultural machinery has not been trebled in the same period or anything near it. I was simply trying to show that this government has made real progress, despite the gloomy forecast made by hon. members of the C.C.F. in 1945.


Thomas John Bentley: That is not a point of order; it is another speech. I do not blame the hon. member; but I do not think I should permit him to proceed further, because I would prefer to finish what I have to say. The hon. member rose to a point of order, and then proceeded to make a short speech.


John Ewen Sinclair: And I will make another-


Thomas John Bentley: Not during my time. You may later, if Mr. Speaker will permit you.


John Ewen Sinclair: You had better not mention my speech, then.


Thomas John Bentley: There is no credit coming to any government which claims that it has raised income from nothing, or practically nothing, to $3,800 a year. What I am trying to say is that agriculture has still not had anything like its share of the national income.
In this connection let me place on record some figures given by the Canadian Federa-
The Budget-Mr. Bentley tion of Agriculture, as they appear in the second to last issue of the Alberta wheat pool budget, page 3. They say that for the years 1931 to 1936 inclusive there was a net loss of from 4-0 to 7-0 on invested capital in the agricultural industry of this country. There continued to be a net loss during the following years from 1937 to 1941 on investment returns of from 3-9 in 1937 to 4-7 in 1941, inclusive. Here is something to remember; during the period from 1937 to 1941 the companies which handled, processed and sold food had a return on their investment of anywhere from 6-7 per cent to 10-9 per cent during the period 1937 to 1941. During the time the primary producers of foodstuffs were losing money on their investment the handlers were making money; and during the greater part of that period there was no war. In this country a Liberal government could have given serious consideration to adjusting the economic factors so as to reverse that condition.
Is it any wonder that the farmers had incomes of only $1,300 a year in the first year mentioned by the hon. member for Vancouver North? The picture changed slightly, so that the farmers received a small return on their investment in the years 1942, 1943 and 1944. In 1945 however they again had a slight loss. During those years every one of these food handling companies had definite returns of from 7-4 per cent to 9-9 per cent. Taking the period from 1937 to 1947 the returns to food handling and processing companies go from a low of 6-7 per cent to a high of 10-9 per cent, whereas only in a few years of that period of time did the farmers receive any return on their average investment.
Figures showing average returns for farmers are misleading, because even with the mechanization of farms many farmers do not receive anything like the average mentioned by the hon. member for Vancouver North or the figures I have just mentioned. Only a few in the higher brackets help to bring the average to anywhere near speaking distance.
However, those were not the principal points I had in mind today when I rose to take part in this debate. What I had intended to deal with is something close to my heart, namely co-operative institutions. There has been no mention whatever in the budget of any relief whatsoever from the iniquitous legislation in operation for three years in connection with co-operative institutions. No consideration has been given to the representations of these co-operative organizations. Every member of the House of Commons I am sure has received a memorandum addressed to all members of parliament under

The Budget-Mr. Bentley date of April 23 from the Co-operative Union of Canada. This is a summary of a brief presented to the government on April 4, some two weeks after the budget was announced.
For years these people have been asking for a federal co-operative act which would clarify all co-operative operations in this country. It will be remembered that not quite a year ago, in the 1948 session, the house passed a private bill to establish the Canadian Co-operative Processors Limited-I always refer to them as the horse co-op. They had to come here to get a special act of parliament; and they got it.
There is no reason why one act could not be passed to give every co-operative organization the operations of which extend across provincial borders the same type of legislation. This act would govern their procedure, and that is what the co-operative union has asked for. Might I add that the union speaks not only for the Co-operative Union of Canada, but for le conseil Canadien de la co-operation. This last named organization will be known to anyone who understands anything about co-operative enterprises in Canada. There are already three of that type of organization, besides the one I mentioned, that apparently cross provincial borders. There is the Maritime Co-operative Services Limited, the Interprovincial Co-operatives Limited and the Canadian Co-operatives Limited. There is no reason why this government should not give consideration to the matter, nor is there any reason why it should not place on the order paper this year an act such as that asked for by the Co-operative Union of Canada.
As an indication of why I think this government has not done what it should have done, I would point out that hardly ever is cooperation mentioned in this House of Commons but the Minister of Agriculture (Mr. Gardiner) gets up and makes a pompous speech about how the Liberals of Saskatchewan made the co-operatives. I have disputed that time and time again. I have told the minister where he is wrong. I know the history of co-operatives as well as he does, but he insists upon pinning all kinds of medals upon himself, even those found around the stockyards, by claiming that he is the father of the co-operatives. If he wants to make that claim stick by concrete action, why has he not convinced the members of the government, most of whom do not know anything about co-operation in any form, that he has something on the ball and it is necessary to have an act of this kind. He has failed completely to do that.
The result is that every time a co-operative association wishes to do business outside the borders of a particular province it must come

down here with its hat in its hand to ask permission. Expensive counsel must be sent down here to do the necessary work and it costs a tremendous amount of money before an act is finally put through to give that one co-operative the right to operate outside its own province. One act would do the same thing for all.
Nothing has been done for co-operatives in this budget by way of removing what I consider to be the most iniquitous tax in this country. I have said that before and I say it again. Any time a group of people are prepared to organize themselves into a cooperative and say to themselves, "We will do business for ourselves in a non-profit way," the government prohibits that by legislation and by doing so commits an iniquitous act.
These people do not complain about paying income tax on that part of their business that is done with people who are not members of their co-operative, but they claim that when they are ready to do business as a co-operative association at cost by the patronage dividend method, there is no reason why they should not be permitted to do it. Yet the government steps in and imposes a three per cent tax.
I should like to tell the house what has happened in connection with thirty-two little co-operatives in my district. Some of these are quite small, only handle bulk materials like fuel, wood, coal, possibly some binder twine and other stuff that is easy to handle and does not require very much labour. There are larger co-operatives that do quite an extensive business, but I am referring to these thirty-two small co-operatives around Swift Current. In 1947 their tax amounted to $4,500, an average of $141 each. Some of them hardly had net earnings of that amount. The amount collected by the government would not pay the cost of collection.
The government is determined to do nothing to offend private business in this country. They have told these little people that they cannot do business as co-operatives until they submit to the tax laws of this country and pay an income tax on the amount of capital employed. I think the word I have used to describe this sort of action is right. If I were given to using unparliamentary language I would use words different from what I have.
The government has had ample assistance from our Progressive Conservative friends in carrying out this program. I am sorry the hon. member for Souris (Mr. Ross) is not in his seat because I intend to refer to a speech he made on March 31 when speaking on the budget, as reported on page 2221 of Hansard. He was there quoting from the remarks of Dr. Karl D. Butler of Washington, president

of the American Institution of Co-operation, as reported in the Rural Co-operator, as follows:
Both co-operatives and other business enterprises emphasize the profit motive as the principal business incentive.
I do not deny to the hon. member for Souris the right to believe that nor am I denying to Dr. Karl Butler the right to come up here and say it, but I do emphatically deny every single word in Dr. Butler's statement, even though it may be believed by the hon. member for Souris. I am going to present some evidence in support of my statement.
I do not think there would be anyone in this house who would have the courage to say that the co-operative institutions of Canada are not based on the Rochdale principle. I know that there are not many who know anything about it. There are very few members of the Progressive Conservative or Liberal parties who know anything about it.


Arthur Leroy Smith: I know as much about it as the hon. member.


Thomas John Bentley: I said that there were very few. If the hon. member for Calgary West (Mr. Smith) knows something about it at least I will be talking to one hon. member who has an intelligent understanding of what I am saying. While there are very few who understand it I do not think any would be ready to go into the country and say that they do not believe in it. They know that the co-operative people of this country base their operations on the principles of the Rochdale pioneers. I should like to quote from the Fundamentals of Consumer Cooperation by V. S. Alanne, published by the Northern States Co-operative League of Minneapolis, Minnesota. Dr. Butler can deal with these people by making the kind of statement he has made, but up here he will have to deal with those who know something about it. I quote:
Here is a significant clause in the now famous program of the Rochdale pioneers: "That, as soon as practicable, this society shall proceed to arrange the powers of production, distribution, education and government; or, in other words, to establish a self-supporting home colony of united interests, or assist other societies in establishing such colonies."
There is a whole book of that sort of thing, every word of which would be useful. The statement made by Dr. Karl Butler will be denied by a great many co-operative people in this country. The profit motive is not the principal incentive. Their motive is to reduce costs and provide the best service possible and give the fairest weights without profit. That is the basic policy and philosophy of the co-operatives of this country.
The Budget-Mr. Bentley
I have some further evidence to present along these lines. I have here a brief which was presented by the Co-operative Union of Saskatchewan to the government of Saskatchewan on January 12, 1949. I know there are some people in Saskatchewan and other places who would like to create a division between those in Saskatchewan who operate co-operative enterprises and the C.C.F. This is the brief that was presented to the government in an effort to establish what these people believe is the basis of relationship between the two functions, to set out where the one could function and where the other could function. They have indicated what they believe is the basic philosophy of co-operative enterprise. For instance, on page 3 they say:
Laws in capitalistic society were primarily made to protect the entrepreneur and were developed and amended through time to protect greater aggregations of capital. While provision was made from time to time to enable co-operatives to enter the commercial field, it was always as a distinct and peculiar division of business and not as part of the general economy.
At page 4 they have this to say:
The co-operative movement grew up as a voluntary organization within the framework of a capitalistic economy.
Later on there is a fairly extensive quotation which I wish to give. They are dealing with what has happened under the Labour government in Great Britain, and they say:
If the foregoing is true in Britain, it is equally so here in Saskatchewan.
They were pointing out where the government's field was and where the co-operatives' field was. They say:
It is submitted that the co-operative movement- consumer, producer, and service-can make an important contribution to stability and the maintenance of effective and responsible democracy in a planned economy as projected by the present provincial government. Having as its base a broad democratic foundation amongst farmers, urban workers, and the professions, it at all times promotes and encourages active participation by the people in the responsibilities of political and economic ownership and control. It is real "free enterprise" in that it enables all men and women, regardless of financial investment, to enter the business field in their own behalf, and at the same time develops a social outlook in working together for service, impossible where profit is the motive.
If the hon. member for Souris (Mr. Ross) ever gets around to reading Hansard of this day I should like him to remember those words, and then cogitate again on the immaturity of his statement in believing the word of somebody from somewhere else who was simply expressing a personal opinion, and who would have been heartily disagreed with by the great bulk of co-operators in this country.

The Budget-Mr. Diefenbaker
If I ever say anything that impresses the government I should like this to be it. If they believe in their hearts that they are trying to build a democratic country in Canada, that they are trying to extend to people in all walks of life, in the political field, in the production field, in the servicing or distribution field, in the business world, the elements of democracy in which we believe so much, then I say to them that they cannot do it if, every time a democratic organization threatens the power and monopoly of some established institution, they do not extend that democracy and clamp down some particular type of legislation on the statute books of this country which will prevent the fulfilment of the purposes of these democratic organizations that rise up in any one of these fields.
If they cannot see that, then there is one other course they are going to follow, just as sure as day follows night. It is now established on the statute books that there can be no such thing as a non-profit co-operative organization in this country inasmuch as they have imposed a three per cent tax. Some day they will come to the conclusion that is not enough to do the job they want done, which is to kill the co-operatives. They will listen to the persuasion of the Canadian Manufacturers Association, the Canadian Chamber of Commerce, and their other big friends, and they will proceed to raise the tax to five per cent. If that does not do the trick they will raise it to whatever percentage is necessary to kill these democratic commercial institutions. If they want to go in the other direction they can move to remove the three per cent tax, and they can do that right now on the budget resolutions. They do not even need to wait until those resolutions are voted upon. The government will receive the support of a great many people in this country, if not politically at least spiritually, if they will have the courage and the decency to give co-operatives the kind of treatment that they have a right to in Canada.


Mr. J. G. Diefenbaker (Lake Centre):: My first words must be words of congratulation to the hon. member for Rosthern (Mr. Boucher) on the maiden speech which he delivered this afternoon. While not in agreement with part of what he said, I think it is one of the finer amenities of public life that parliament should recognize the contributions made by hon. members of other political parties. Through you, Mr. Speaker, I extend to him my congratulations on his contribution today.
I listened with a great deal of interest to the lecture just read to the house by the hon. member for Swift Current (Mr. Bentley).


Thomas John Bentley: I rise on a point of order. I read nothing except my quotations.


John George Diefenbaker: I said my hon. friend read a lecture; even if he spoke it he still read a lecture. He spoke, in the usual disparaging tones, of all those who believe in free enterprise. He mentioned the development of co-operatives and intimated to other members of the house that they knew nothing of the Rochdale co-operatives, the foundation of the co-operative system. I point out to him that in 1931 when the great pool organizations, the great co-operatives dealing with the sale of wheat, found themselves in grave difficulties it was governments such as the government of the late Viscount Bennett, the government of Manitoba then under Mr. Bracken, the co-operative government of Saskatchewan, the U.F.A. government of the province of Alberta, that assured that these co-operatives were maintained and placed in a position where they might make their contribution to securing for the western farmer the largest possible return for his wheat.
I listened with no little interest as he referred in the usual manner to profits, in line with the viewpoint always expressed by the C.C.F. party, in favour of production for use and not for profit. As he spoke I thought it might be of some interest to the house to have a general picture of the development of government-owned enterprises in Saskatchewan. I am not going into full particulars this afternoon, but I remember well, as you have so often heard, Mr. Speaker, the beautiful picture that was painted of social security provided without taxation as a result of the operation of business concerns by the government of Saskatchewan, and the profits made thereby. We do not hear so much about that any more.
We used to be told of the wonders of New Zealand, but now in our own country we have a government that went into competitive business at a very fast rate indeed, and seems now to be going out of business almost as quickly. I am going to refer for a moment, before I deal with the budget references that I intend to make, to some of the concerns operated by the government of Saskatchewan out of which we were told that social security would be provided. As regards industries that are peculiarly fitted for public ownership, such as power and the like, the same trend has taken place in Saskatchewan as everywhere else under other governments, but wherever the government of Saskatchewan has entered into any industry that depends upon competition with private industry the result has been loss to the people of the province of Saskatchewan. The government went into the woollen business. They started a woollen mill, which was established

in 1945. Up to December 31, 1948, it lost a total of $147,203; and it had an advance from the provincial government by way of capital amounting to $125,000, upon which it paid no interest or the loss would have been greater. They went into the tannery business in April, 1946, operating the only tannery in Saskatchewan. To the end of December, 1948, the loss was $78,500. They were attracted to the opportunity which was offered in the shoe business. Everybody wanted shoes, and we had the raw material available in Saskatchewan with which to make shoes; so they went into business. There was a capital advance of $171,000; and the net loss to December 31, 1948, was $63,000. They found it impossible to carry on at a profit, and in December the tannery and shoe factory were closed and will remain closed until spring. The employees of these two businesses were left either to secure positions elsewhere or to live on unemployment insurance furnished by the federal authorities. They went into the brick business, and the loss to the end of December, 1948, was $28,000. They established a fish board, and to the end of December, 1948, lost $197,123. In every case I have mentioned no interest has been allowed on capital advances, which amounted to $846,650 as far as the fish business was concerned.
I mention these businesses for the purpose of placing before the house one matter, and it is this. Governments in competitive business are always hopeful of success, but in almost every case are unable to carry on profitably. I say that because we in this country must realize that social security can and must be furnished; but when it is furnished it must be paid for from the taxation levied upon the people as a whole. We believe in social security. We believe in a great social security plan under which men and women of this country, during the period of their earning capacity, will be able to contribute to a fund so that security may be assured them when they arrive at a period of life when they need assistance. When they tell me, Mr. Speaker, that government can succeed in business, let them look at the experimental station in the province of Saskatchewan where improvements have been made in social security, which I admit, but where taxation has increased by $17.50 per year for every man, woman and child in the province.
I got into this discussion, sir, because of the attitude taken by my hon. friend. From great heights he looks down upon the rest of us, the hon. member for Souris (Mr. Ross) and other hon. members in this house including myself; he impugns our motives, ridicules our intentions and at the same time places himself on a pedestal as possessing all the
The Budget-Mr. Diefenbaker political and personal proprieties that Providence has not vouchsafed the rest of us in this house.
Now I come to another matter; I am going to refer to the situation created by the government as a result of the announcement by the right hon. Prime Minister (Mr. St. Laurent) last evening that an election will be held, presumably on June 27.


Some hon. Members:: Hear, hear.


John George Diefenbaker: I have never seen such optimism expressed on all sides. We are all glad there is going to be an election this summer in order to give the Canadian people an opportunity of passing judgment upon those of us who have been representing them in this house during the last few years. I can see the ministers going through the country-my smiling friends the Minister of National Health and Welfare (Mr. Martin) and the Minister of Finance (Mr. Abbott), along with the Prime Minister-telling the people of this nation, "The reason we did not serve up the menu set out in the speech from the throne is that the opposition prevented us from doing so." I look back to January 26, when His Excellency had placed in his mouth the promises of the government, as to what they intended to do. I shall refer to some of those promises now, for they will remain only promises, hopes and dreams of what might have been.
The government has had every opportunity to bring in all the legislation it chose. Every whit of legislation that was placed before parliament prior to the Easter adjournment was passed. Every item in the nature of emergency legislation that had to be passed before March 31 was passed by parliament. Here are a few of the things that the speech from the throne shows as of immediate moment, which were to be submitted at the present session. Amendments to the Supreme Court Act to abolish appeals to the privy council; approval of the agreement for the development of the Great Lakes-St. Lawrence waterway. Will the government explain the situation in regard to that matter? Then there is the question of trade, one of the most serious problems affecting the people of this nation at this time. There is not a farmer in Canada who is not fearful of the situation with respect to agricultural markets; yet here we are going into an election with the government having done nothing and, equally serious, having given the people of this country no indication of their realization of the serious existing situation or of any attempted solution of the problem.
Then there is the matter of prices. Do you remember, Mr. Speaker, when the committee on prices was set up, having as its distin-

The Budget-Mr. Diefenbaker guished chairman my hon. friend the Minister of National Health and Welfare? It sat for more than four months; and the longer it sat the higher went prices. Then the government decided to set up a royal commission on prices, which also sat for several months and finally evolved a report. According to the speech from the throne, the report of the royal commission was to be laid before parliament. It was tabled in parliament but no opportunity was given to the members of this parliament to place before the government and the country certain matters which would result in a reduction in the present high prices.
Last evening the member for Vancouver North (Mr. Sinclair) told us all that this government had done. He spoke of prosperity. He did not tell you, however, that under this government we have the highest prices in Canadian history and nothing is done about it. The reductions in income taxation in the budget do not go far enough. I do not see any realization on the part of the people that the Minister of Finance (Mr. Abbott), to use the words of one member, is a Santa Claus. They know he gives them nothing back; he is only talcing less during this year. With prices at the present level should not something have been done to reduce the sales tax on necessities which in the main rests upon people in the lower income tax brackets.
Another thing that was promised in the speech from the throne was the amendments to the Prairie Farm Assistance Act. Where are those amendments? Did they exist? Or is it like the questioii posed by the member for Swift Current (Mr. Bentley) that would have been asked yesterday by the member for Melfort (Mr. Wright) if the member for Lake Centre had not preceded him. Where are those amendments? Everywhere in Saskatchewan today, the people of that province are faced with a drought the like of which has not been experienced in fifteen years. They want amendments to the Prairie Farm Assistance Act reducing the areas of qualification. In practically every mail they ask, What are you doing about this matter? Will you bring in the amendments? Will you do your part so that the Prairie Farm Assistance Act will maintain many of us on the land who otherwise are likely to be driven from the land this year because of grasshopper infestation and drought? Produce those amendments, I say to the government.
Now hour by hour legislation is being rushed through. The order paper is cluttered, but for a long time there was very little on it. Bring in those amendments so that the people in western Canada may be assured of that hope that is being denied to them because the Prairie Farm Assistance Act is administered

under some bureaucratic regulations contrary to the principle of that law. Agricultural markets are being lost. Britain is turning to the various countries in Europe. We have three contracts with the United Kingdom for agricultural products whereas at one time we had twenty-two.
One of the sources of collective power in the House of Commons in so far as farm problems are concerned is the committee on agriculture. Why was it not set up? Why was that committee, representative of all parties in the house, denied an opportunity this session to make some contribution by suggesting alternative markets for Canadian products? Mention was made by the member for Grey North (Mr. Case) of radio broadcasting. Why was that committee not set up? Were political considerations, or the prospect of an election, the reason that two of the most important committees of this house have been denied an opportunity to function for the benefit of this country?
Everywhere communism is threatening us. Within the last few days there has been an indictment of the government in the discovery of a self-confessed spy who entered our country under the guise of an immigrant. Communism is undermining our nation in various places. Ask the mounted police. Why not introduce legislation in keeping with recent remarks of a minister of the crown that teeth would be put in the law in order to preserve this nation from the undermining influences of this heathen philosophy? Nothing has been done. Nothing effective has been done by the public accounts committee set up a few days before the recess. Now, all opportunity of looking over the expenditures has been denied by the action of this government. Why were these committees not set up earlier? Do my hon. friends opposite say there have been no extravagant expenditures? I wait for one of them to say no.


Mr. Abbott:: I say no.


John George Diefenbaker: They don't know.


Douglas Charles Abbott: I said no.


John George Diefenbaker: It is six o'clock and so I will go on from this point after recess.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at seven-thirty o'clock. PRIVATE BILLS

[Stage Direction]
The house in committee on Bill No. 25, respecting the Globe Printing Company, Mr. Golding in the chair.

On section 1-Real estate limited.
Mr. Knight:: Mr. Chairman, on introducing this legislation, as recorded on page 2127 of Hansard, the hon. member for Peel said at page 2128:
So far as I know there Is nothing contentious or complicated in this proposal, so X would ask that the bill be given second reading and referred to the appropriate committee of the house for further study.
I do not know whether there is anything contentious about it or not, but one could not help being struck by the significance of the fact that it was at least coincidental that the bill was introduced at the same time that certain legislation was being introduced, and I believe afterwards passed, in the Ontario legislature.
The Globe Printing Company applied at that particular time for an increase in what is termed annual value. I, who am a tyro in these matters, discovered from the counsel of the company in committee that that simply was a term synonymous with rental value. It is, I think, odd on the face of it that the tremendous increase in that annual value should be asked for at once; that is to say, an increase in the rental value from $30,000 to $100,000. Let us be candid about what one might fear from this legislation, combined with the legislation which has been passed in the Ontario legislature.
I put certain questions to the counsel for the company in committee, and although I missed the second meeting of the committee I am informed that the counsel for the company did not procure, nor did he submit at the second meeting of the committee, the information for which I had asked.
To go back to what one might fear from this bill, I would say it is well known that the Globe and Mail in the city of Toronto is the only firm which would be interested enough and which would have the necessary capital to take over the building and the ownership of another newspaper published in that city. The bill itself does look innocent, and as I said before I do think that the hon. member's speech was perfectly innocent also. He has assured me that that is so and that the bill is just what it states on the face of it. That assurance I shall cheerfully accept so far as he personally is concerned.
The history of the Globe company was detailed by the hon. member for Peel. There are certain facts which one can find from the statutes. For instance, the Globe company was first incorporated in 1866-that is, before confederation-by a statute of the then province of Canada. At that time the capital stock was fixed at $300,000, and the annual value of the real estate which the company may hold should not exceed $5,000. In the year 29087-164
Globe Printing Company 1877 the act was amended and it was provided that the company might by bylaw increase its capitalization to any amount which it considered requisite. In 1892 the act was further amended. There was no legislation at that the company might by bylaw increase capital stock, but it was provided in 1892 that the company could hold real estate of an annual value not exceeding $30,000.
I understand from the answers of counsel of the company that the purpose of this increase is to purchase the property in which the paper has been operating but which, up to the present time, as I understand it, it has not owned. I think that is the property of the old Mail. I asked counsel a question in committee. For example I asked him, if the company changed its mind about using its present premises, whether there was anything which would legally prevent the company from investing its increased money in other premises where it could carry on its business. He told me that legally there was no such prevention, but he also maintained that the company had no such intention; that it was perfectly content to stay where it was. They wanted to get the property and the paper under the same name and owner.
In 1911 the act of incorporation was again amended with respect to the capitalization of the company. The legislation of 1877 which put no limit on the amount of authorized capital was repealed and in that amendment it was provided that the directors might increase the capital stock but not to exceed $1 million.
The situation is now that the company can issue stock to an amount not exceeding $6 million, and it can hold real property, the annual or rental value of which-I presume the terms are synonymous-cannot exceed $30,000. It is the increase of $30,000 to $100,000 for which the company is now having this legislation introduced in the House of Commons. I think that the passage of this legislation should be delayed. While in committee we heard a brief presented by a most able lawyer acting on behalf of the company, I believe we should have something on the other side of the question. We should not be rushed into this extensive capitalization, or this increase in capitalization. We would want to know how it has been computed, or whether it fluctuates or remains fixed.
I should like to know the assessed value upon which these people pay taxes; I should like to know the value of these properties from time to time, as the years have gone by. It seems strange why, if this company has been able to carry on at all at a rental value of $30,000, there should be this immediate and urgent necessity at one jump to increase that value to $100,000.

Globe Printing Company
I believe that perhaps the reasons they have come to parliament for this amendment of the act of incorporation are proof in themselves that parliament should know why this increase is required. Some full disclosure should be made by the company as to the annual value of the property when they took it over. We could then compare that figure with this $30,000 annual value. I believe it would be discovered that the company is asking for a much greater increase than is justified.
That, sir, is my argument in the matter. I think we should have more information. I am not suggesting anything sinister, but I am merely pointing out that there is a coincidence. We should have both sides of the question before we tackle this problem or embark upon legislation for which the city of Toronto and certain elements of the press in that city may be sorry before the thing is finished.
Is the purpose of this enlarged capacity for holding real estate to make possible the purchase of any real estate that they do not hold already? The answer given by counsel was, no. He reiterated that it was simply to have under the name of the company the property they already hold and operate. When I asked if there was anything to prevent their changing that property, or investing the extra capitalization in another property, he said that so far as he knew there was nothing legally to prevent it.
Does the bill in any way permit the purchase of real estate other than that now in possession of the company? The answer to that is, apparently, yes.
Does the bill specify the particular real estate it is authorized to purchase? The answer is, no. In other words, the company is left in perfect freedom to operate in whatever building it sees fit, either to purchase new property or to purchase property in which they already operate.
Then, coming to the crux of the matter, the thing in which I was interested, I asked this direct question: Would it then be possible under this legislation to purchase a newspaper such as the Toronto Daily Star, and the answer was:	Legally, yes. There was
nothing to prevent it, but so far as he knew the company had no intention of so doing.
That is my argument for delay. I therefore move in amendment, seconded by the hon. member for Regina City (Mr. Probe):
That section one be amended by deleting the words "one hundred thousand dollars" and substituting therefor the words "forty-five thousand dollars."
It will be noted that there is an extra $15,000, which represents a 50 per cent increase in rental value. I believe this might

be justified, until we have had some further opportunity to study the implications of this particular piece of legislation.


Mr. Graydon:: Mr. Chairman, this bill was fairly thoroughly examined in the committee on miscellaneous private bills. When I say that it was thoroughly examined, I mean there was an exhaustive discussion with respect to questions raised by various members of the committee. As the hon. member for Saskatoon City said a moment ago, I believe at the last meeting of the committee there were one or two questions which he had propounded earlier but which he did not follow up in the proceedings of the committee, perhaps because he was unable to be there.
In a moment I shall deal with the points involved. First, however, may I point out to him and the committee that there is nothing sinister in the bill now before us, nor is there anything in it which would in any way justify the suspicions expressed by the hon. member who has just taken his seat. I do not wish to discuss in detail the questions he has raised, because in my view they are not relevant to the legislation before us. More than that I believe I could state properly that they are not based upon any inference which might properly be drawn from a piece of legislation as simple as this one.
I suppose it is always difficult in public affairs to separate what is taking place in two separate legislative bodies. Let me point out, however, that I believe the hon. member is carrying his inferences and his suspicions much too far, because if my memory serves me correctly this bill was introduced to the Senate some considerable time before any other bill, such as that which he has mentioned, was introduced in any other legislature.
As I pointed out on motion for second reading the purpose of this bill is a very simple one, and one which has nothing to do with the purchase of other properties. It has to do only with putting under one roof and into one company all the present establishment of the Globe and Mail which is published at the corner of King and York streets in Toronto. At the present time the building at that point, the real estate, is owned, and title to the land and building is in the name of the Mail Printing Company. Business is carried on under the name of the Globe Printing Company. All this bill attempts to do is simply to put both the business and the building and the real estate under the same name. I should not have thought anyone would raise any serious objection to that.

More than that, I think hon. members will readily understand that when companies are not incorporated by acts of parliament, similar to the original act in this case which was passed back in the sixties, no limitation is placed upon the value of property that a company can hold. The only limitation is that it be used for the purposes for which the charter provides. I suppose that, as we must come to parliament in these extraordinary circumstances of a statutory company, these questions may normally be raised.
I find no fault whatsoever with my hon. friend for raising any question because the committee desires to have a clear picture of exactly what is going on. I want to draw that picture just as clearly as I can. That being the case, I should like to point out to my hon. friend that if any purchase were contemplated this legislation would not be of any help. My little knowledge, and it is little, of how businesses as large as the figures *would indicate this one is are carried on is that this would not be of any assistance. I proffer that explanation from information I have received and which I believe is reliable.
I am anxious to give my hon. friend all the information there is at my disposal. When the company was first incorporated by statute in the sixties it was given the right to hold land to an annual rental value of $5,000. If my memory serves me correctly, in 1892 the company was given the right to increase its holdings of land to an annual value, which I think my hon. friend and I are in agreement as meaning a net rental value, of $30,000.
With the extension of the building and the erection of a structure such as this, and with costs being what they are, I would not think that even in the normal course of events an increase from $30,000 in those days to $100,000 would be much out of the way. The amendment now before us limits the increase to $45,000 and I would think that that is so restrictive as to make the bill practically useless. I am quite sure that my hon. friend has no desire to do that.
My hon. friend asked certain questions in the committee which I shall attempt to answer here. First, he asked the value of the property presently occupied by the Globe Printing Company, the title of which is in the name of the Mail Printing Company. This is the property the Globe Printing Company is attempting to get power to take over. I am told that the assessed value of the land and premises is $826,378 and the actual value of the property is said to be around $2 million. From the information given in the committee I would submit that the present request is not exorbitant nor are they going beyond the bounds of propriety when they ask for an annual value of $100,000.
29087-164i
Globe Printing Company
As a matter of fact this is a maximum amount. I fancy that the company is not desirous of coming back from time to time to ask for petty increases. Every opportunity was given before the committee for full disclosure, for full discussion and for full examination of all details of this transaction.
I think the further inquiry that the hon. member suggests should be made could have been made while the committee was sitting. At that time the representatives of the company, as members of the committee will testify, were ready to give every possible bit of information they could to the committee. I know of no information that was withheld.
For that reason I suggest that the amendment be not approved by this committee and that the original bill providing for an annual value of $100,000 be approved. I think that is a reasonable, proper and fit thing for this committee to do. This company should be given the right to purchase the property that it presently occupies.
Having had the circumstances detailed to him to the best of my knowledge I would ask the hon. member if he would not withdraw the amendment with the approval of his seconder and allow the bill to go through. I would not make that appeal if I had the slightest doubt as to the propriety of the legislation. More than that, if I had any doubt about it I would not be sponsoring the measure.


Mr. Jaenicke:: The hon. member gave a figure of $100,000; does that apply to the Mail Printing Company or the Globe Printing Company?


Gordon Graydon: The assessed value of the property presently occupied by the Globe Printing Company is $826,378.


Frank Eric Jaenicke: What did the $2 million figure represent?


Gordon Graydon: The actual value of the property occupied by the Globe Printing Company is $2,031,516.


Frank Eric Jaenicke: Is that the book value?


Gordon Graydon: I cannot say as to that.


Frank Eric Jaenicke: What are the corresponding figures for the Mail Printing Company?


Gordon Graydon: The title of the building occupied by the Globe Printing Company is in the name of the Mail Printing Company. That information came out in the committee. I think I can satisfy my hon. friend by saying that the Mail Printing Company operates a small plant under lease in another part of the city where it carries on a job printing business.


Robert Ross (Roy) Knight: I have heard the argument presented tonight by my hon. friend, just as

Globe Printing Company I heard what he had to say in the committee. While I am perfectly convinced of my hon. friend's personal integrity in the matter, nothing that he has said has made me change my mind in connection with the request I make that my amendment be voted on so that we may get the opinion of the members of this committee as to whether it would not be advisable to delay this legislation until we have some further information.


Mr. Ferguson:: What objective can be gained by delaying the bill? This is an old company which was incorporated under letters of patent. A new company incorporated today would not be handicapped with this old shackle. The C.C.F. members are delaying the passage of the bill. Why will they not divulge their motive in asking for a delay? They have listened to this matter being discussed in committee. It has been hashed over time and time again. Yet they still contend that there is something wrong, something that is not quite correct. They are asking questions and they want to delay it. Why do they want to delay it? Why not let us see what they are driving at, or is it the fact that this bill concerns a private enterprise trying to carry on business? The C.C.F. members are spending the public's money at the rate of about $2,000 for every forty minutes. They have listened to this matter being hashed over time and again in committee, and nonsensically they are asking the same things again. It is utter nonsense.


Mr. Stewart (Winnipeg North):: Apparently somebody is not adhering strictly to the truth, because we have been told that we have heard this matter hashed over time and again in committee and yet the member for Saskatoon City has told us that he asked certain questions of counsel when the bill was before a committee of the house, and answers were not given. The member for Peel stated in his remarks that he would not go into the questions raised.


Gordon Graydon: I did not say that.


Alistair McLeod Stewart: You will And it in Hansard. I think it is only right that before we pass this legislation the committee should have some knowledge of what the facts are, and I believe these questions should be answered. That is all we are asking for now. There are no ulterior motives. I have no great regard, and less respect, for the Globe and Mail, but I am prepared to live and let live. As things are now, I do think that the committee is entitled to answers to the questions asked.


Gordon Graydon: May I ask the hon. member if there are any questions that still remain unanswered? We have attempted to answer every single question that has been raised.
[Mr. Knight.l
Amendment (Mr. Knight) negatived: yeas, 27; nays, 34.
Section 1 agreed to.


[Stage Direction]
Preamble agreed to.
Title agreed to.
William Henry Golding: Shall I report the bill?


Mr. Cruickshanlc:: May I ask my question now? Has this bill any connection with a bill to prohibit the publishing of the Toronto Star?


An hon. Member:: Read it.


George Alexander Cruickshank: Just a minute; the Tories
have had their day. Their leader took a day off and got lost, and the member for Vancouver North stole the show yesterday. Has this bill any connection with the other measure to which I have referred?


John Ewen Sinclair: I would not want to steal any show that the leader of the opposition has.


Gordon Graydon: May I answer my hon. friend by saying that the answer to his question is no.


George Alexander Cruickshank: Do I understand then that George McCullagh has no connection with it?


Gordon Graydon: I rise on a point of order, Mr. Chairman. The bill has been passed, and we are not going to listen to slander across the floor of the house.
The Depuiy Chairman: Order. The bill has been carried.
Bill reported.


Mr. Speaker:: Mr. Graydon moves that the said bill be now read the third time. Is it the pleasure of the house to adopt the motion?


Mr. Arthur Williams (Ontario):: Mr. Speaker-


Mr. Speaker:: I put the motion.


Some hon. Members:: He was on his feet.


Arthur Henry Williams: The member for Simcoe North (Mr. Ferguson) raised a question as to the C.C.F. members obstructing the passage of the bill. He asked why they did not come out and state their real purpose in doing so. I think it is obvious from the remarks of the hon. member for Simcoe North that even in his own mind there must be something surrounding this whole matter that gives him the idea of suspicion about it. As far as I am concerned as a member of the house, I wish that a bill of this nature had not been introduced at this particular time. As to the member responsible for the introduction of the bill, the hon. member for Peel (Mr. Graydon),

I am quite ready to accept his word that the bill is just what he says it is. I do not know of any member of the house who commands the respect of other members more than the hon. member for Peel, and I take second place to no member of the house in my regard for his integrity. I am certain that he is of the opinion that this bill is the innocent little instrument that he claims it is.
Unfortunately I have a different feeling altogether about the bill. I cannot dissociate my mind, in considering this bill, from another bill that was introduced in another legislative chamber, that of the province of Ontario. I am certain that, if this particular bill that is now before the house had been introduced prior to discussion on that other bill in the legislature of the province of Ontario, members' minds would not be filled with doubt about the simplicity and the innocence of this bill. I think it is most unfortunate that the bill before the house is being introduced in such an unsavoury atmosphere. After all, this bill refers to a particular newspaper and a particular individual, who happens to be the owner and publisher of two newspapers in the city of Toronto. Those newspapers are wholehearted supporters of the party responsible for the introduction of this bill in this house and the other bill in the provincial legislature.


Mr. Speaker:: Order. I would ask the hon. member not to refer to an act which has been passed by a provincial house.


Arthur Henry Williams: I accept your correction, Mr. Speaker; and if it had been made earlier I would have gladly observed your ruling at that time. In view of what was said by the hon. member for Simcoe North (Mr. Ferguson), since these thoughts were in my mind I could not help but feel that I should make myself clear to this house at any rate, so the hon. member would have no doubt about the position as far as I was concerned.


John Ewen Sinclair: If I may interrupt, Mr. Speaker, on a point of order, would you be good enough to tell the house the rule which forbids us mentioning an act which has been passed by any of the nine provinces?


Mr. Speaker:: The hon. member knows quite well that this debate should be relevant to the bill now before the house. It has nothing to do with an act which has been passed by a provincial legislature.


John Ewen Sinclair: I may not have heard correctly, but I understood you to make the observation that it was improper for the hon. member to refer to an act which had been passed by a provincial legislature. If I am in error I must apologize.
Globe Printing Company


Mr. Speaker:: I do not have them at hand just now, but I could give the hon. member rulings made by my predecessors to the effect that in this house we should not discuss legislation that has been passed by provincial legislatures.


William Irvine: What is the ruling now? We could not hear.


Arthur Henry Williams: With great deference, Mr. Speaker, I accept your ruling, without regard to the point raised by the hon. member; and I shall continue on from there. If you will permit me to do so I should like to merely reiterate that my only purpose in making that observation was to perhaps enlighten the hon. member for Simcoe North, because I thought he asked the motive or purpose of hon. members of this party in delaying this bill, and I wanted to make my intentions quite clear.
I do not believe this bill should have third reading, and pass. I make that statement because ever since the inception of the newspaper now known as the Globe and Mail it has been able to carry on most competently and most efficiently. I make that statement knowing that I am paying a compliment to private enterprise, which hon. members to my right sometimes say we are not willing to do. I pay that compliment to the Globe and Mail, and I can do no less having in mind that I see this newspaper every morning about as well gotten up and as clean-perhaps not in its contents but at least in its appearance-as any newspaper published in Canada. It has been carrying on in this way ever since its inception. I have seen its building; I have seen its presses in operation; and for the life of me I cannot understand why it would need any further facilities either now or in the foreseeable future. It is amply equipped to carry on its work.
For that reason I question again the necessity of this legislation which would permit it to enlarge its facilities. For what? I am satisfied that this newspaper wants added facilities for one reason only; that is, to extend its present control of news publicity in the city of Toronto. There is only one other instrument of publicity in that city today, and that instrument is not favourable to the party sponsoring this bill in this house. I mean no reflection upon the integrity of the hon. member for Peel (Mr. Graydon) when I say I believe the real reason behind this bill is in order that the present facilities of the Globe and Mail may be extended so that eventually it can absorb its only news competitor in Toronto.
Globe Printing Company So I am going to move, seconded by the hon. member for Saskatoon City (Mr. Knight), the following amendment:
That the word "now" be deleted from the question and that the words "this day one month hence" be added at the end thereof.


Alistair McLeod Stewart: There are a few remarks I should like to make on this matter-


Mr. Speaker:: Order.


Alistair McLeod Stewart: Obviously it is after eight-thirty.


Mr. Speaker:: Order. The hour reserved for private and public bills having expired, the house will now revert to its business prior to seven-thirty o'clock.



STANDING COMMITTEES


Mr. L. O. Breithaupt (Waterloo North):: Mr. Speaker, with the consent of the house I should like, if possible, to revert to motions in order to present the fourth report of the standing committee on railways, canals and telegraph lines.



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. Macdonnell (Muskoka-Ontario), and the amendment to the amendment of Mr. Coldwell.
John George Diefenbaker: Mr. Speaker, at recess I was dealing with the various measures promised for consideration in the speech from the throne, and which, as a result of the Prime Minister's announcement made last evening, will not be dealt with. Some reference was made by the Minister of Finance (Mr. Abbott) to the question of extravagance, and I shall point out to him, if he

Lockhart
Low
McCann
McCulloch (Pictou) Macdonald (Brantford City)
McDonald (Parry Sound)
McGregor
Mcllraith
Mclvor
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MacNaught
MacNicol
Maloney
Marier
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Mayhew
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Murphy

has not already read it, that on page 23 and following of the Auditor General's report various references to that effect are made. Within the last few days, Veterans Land Act houses in the city of Saskatoon, particularly at Montgomery Place, have been shown to be grossly overvalued, and with many construction defects. This matter could have been dealt with in the committee, had the committee on public accounts been set up.
I am not going to deal with many such matters this evening, because I have only eighteen minutes left. But I should like to point out to both those hon. members who interjected at the same time that one of the best examples of a reward for a political friend-and it is only a matter of $109,000 which, in these days, really does not matter, so far as this government is concerned-is to be found in what was paid to the lawyer in the city of Toronto, Mr. W. C. Thomson, who, looking after veterans' land applications for title and the like in the course of the year, 1948, received in fees-and I point out again that it was fees, not disbursements-the sum of $109,000 for his services, or $355 a day for every working day in the year. Two or three solicitors could have looked after that matter and saved much of that amount.
And going into western Canada, indicating the reason why our farmers complain, let me refer to the government elevator in the city of Saskatoon with a total capacity of 5,500,000 bushels. During the years 1947 and 1948 it was shown that the average use of this elevator in the first of those years was 52,071 bushels and in the other year 58,711 bushels. Without allowing anything for interest or any other charges of that nature, the cost of operating that elevator during the year, in salaries alone, amounted to $52,755 in each year, or 90 cents a bushel for every bushel of wheat stored in the elevator during the years 1947 and 1948.
I have various other examples before me which indicate that there has been gross extravagance on the part of this government.
In the speech from the throne we were apparently to be made aware of the defence measures taken by this country, and their adequacy. A steel program was to be brought before the house. We were promised amendments to the law regarding our armed forces. Amendments were to be made to the Industrial Development Bank Act, to the Emergency Gold Mining Assistance Act; the shipbuilding industry was to receive assistance, the Department of Reconstruction and Supply was to be set up, and was to take over housing.
Some of these matters are on the order paper, and have been there for a period of
The Budget-Mr. Diefenbaker three or four weeks. What does all this add up to? There were so many matters in this legislative program as set out in the speech from the throne this year that the government must have intended that a normal session of parliament would be held.
The speech from the throne was a carryall of omnibus promises made to the Canadian people. When the speech from the throne was prepared the government had no idea of a short session. No government, having regard to this legislative program, could have anticipated or intended that at the end of two months the House of Commons would be dissolved.
Why this change? We welcome the change of heart, to give the Canadian people an opportunity of showing what they think about this government. In my opinion, this course is being followed not because the government wants to give the Canadian people that opportunity. What is the reason for this sudden haste, and the fact that this prospective legislation goes into the limbo of forgotten things?-except on the hustings, of course, when the forgotten items will be referred to. An endeavour will be made on the part of the government to say that they were obstructed; and I give them their answer now, that there has been no obstruction at this session and every piece of legislation that has been brought before the House of Commons has been passed. The charge of obstruction will provide no excuse. The reason the government now seeks to go to the country at this time lies in the fact that Canada's trade, both industrially and agriculturally, is in such a position that within the next two or three months this nation may face a national crisis such as we have not faced in many, many years.
I have before me a Canadian Press dispatch of April 14 which says:
Canada's favourable balance of trade with the rest of the world slumped sharply during February.
Reporting monthly trade totals, the bureau of statistics disclosed today that the favourable balance -the excess of exports over imports-fell to $1,200,000 in February from $15,200,000 in January and $28,100,000 in February, 1948.
. . . The downward trend resulted from a sudden substantial increase in the value of imports from other countries and a drop, though of smaller proportions, in sales to the export market.
When the Prime Minister (Mr. St. Laurent) was in British Columbia on April 14 he stated he realized the situation with regard to trade. Canada is faced with a trade peril, the like of which we in this nation have not faced for many years. In the speech from the throne we find this statement:
With a view to assisting in the restoration of world trade, so vital to general security and our own prosperity, Canada participated in formulating the
2602	HOUSE OF
The Budget-Mr. Diefenbaker
charter for the international trade organization and the general agreement on tariffs and trade which will be submitted for your approval.
Is there any member in the House of Commons who has heard a statement from any minister of the government in regard to trade, except the generalities which were indulged in by the Minister of Finance (Mr. Abbott) in his budget speech?
So far as agricultural trade is concerned, between 1939 and 1949 Canada negotiated 142 contracts for the supply of food products to the United Kingdom. We had as many as 22 in one year. Now we have three. Great Britain is entering into agreements everywhere in Europe. She has entered into negotiations for a five-year pact with Poland. She will get bacon, eggs and other food in return for wool, tin, copper, rubber and cotton. This trade agreement is expected in the five-year period to total $1,200 million. She would purchase from Russia 1,500,000 tons of corn, barley and oats during 1949. This would be twice as much as Russia sold Britain during 1948.
Britain has cut down her purchases of Canadian salmon, poultry, apples, beef, timber and newsprint. Now she takes less bacon and eggs. There is a picture which should demand and challenge the attention of the government at this time in this country.
Today in a Canadian Press dispatch from London the following appears:
United Kingdom bacon imports from Canada have slumped sharply in recent months. In February this year the United Kingdom took only 31,729 hundredweight, compared with 136,575 hundredweight in February, 1948-
-or approximately one-quarter of what the exports of bacon from Canada were one year ago. Our cheese contract is for less than we have had with the United Kingdom in a period of thirty years. It is true enough that the situation at the moment is being smoothed over by exports to the United States, but the similarity of our production with that of the United States and the agricultural surpluses that are being piled up there indicate the danger that is being faced by the Canadian farmer.
The same applies industrially and I would refer to that if I had more time at my disposal. I hold in my hand an advertisement that has appeared in the press this week with the picture of the Prime Minister (Mr. St. Laurent) reading, "Our farmers have markets." That is what it says, but it could say something else. It could say that in 1941 there were 18 food contracts; in 1942, there were 14; in 1943 there were 15; in 1944 there were 19 as there were in 1945; in 1946 there were 22 and in 1949 there were three.
Our farmers face a situation in the matter of trade that is of serious consequence. The
[Mr. Diefenbaker.)

government realize that the accumulation of conditions will come to a head in the near future and instead of facing that issue before the people then they are attempting to run away from it through an election now.
The speech from the throne was filled to overflowing with everything that any minister could fondly imagine. It will be noted that legislation in the matter of social security which has been held up for years is being passed now and that in the last two or three days the overflowing heart of this government has been beating more rapidly for the people than ever before.
Defence matters and the other questions including the preservation of our trade are forgotten. They are hidden away and parliament is denied the opportunity of discussing them. The Canadian people are denied information or a solution for their trade plight. The reason for the haste can be explained in no other way. The Prime Minister has been across Canada; indeed while our markets tumbled, the Prime Minister traveled.


Some hon. Members:: Oh, oh.


John George Diefenbaker: My hon. friends say, "Oh, oh". The Minister of Justice (Mr. Garson) does not know what I am talking about at the moment.


Thomas Vincent Grant: Does the hon. member know himself?


John George Diefenbaker: The hon. member for Kings (Mr. Grant) can speak with courage because he is about to be elevated to another place. The ministry must know that a national crisis is approaching. They know that agricultural production is rising while our markets are falling. They know what will follow if agriculture loses its markets. It is a truism that Canada depends upon agriculture for her prosperity. They know that the only hope they have to cover up their failings and blunderings in the matter of trade is to appeal to the people before the people realize what is taking place.
The Progressive Conservative party intends to face the issue of trade. National survival demands trade. Our whole security program demands trade. The expansion of this nation will be retarded unless something is done to meet the loss of our markets. One of the major issues in this campaign will be the loss of Canada's trade by a government that has failed to act in order to prevent the drying up of the channels of trade upon which this nation depends.
We in this party are prepared to place that issue along with many others before the people of Canada knowing that even though we have been denied the opportunity of dis-

cussing them in the house we will place them before the people so that all who hear will understand.


Mr. Clarence Gillis (Cape Breton South):: Mr. Speaker, when the Prime Minister (Mr. St. Laurent) announced last evening that the house was going to be dissolved at the end of this week the members of this group were quite prepared to get through with whatever legislation we still had to pass and get away as soon as possible. I think that the legislation that we have to pass could have been passed without any undue delay before Saturday morning. However, during the last few hours it has been proven, to me at least, that the election campaign is starting here and is going to be continued as long as the house remains in session. That has been clearly indicated by the last speaker, the learned and hon. member for Lake Centre (Mr. Diefenbaker).
I think highly of the hon. member. He is a great lawyer, and like all great lawyers he has the happy faculty of being able to twist facts and make them appear as though he were really convinced they were so. He quite excelled himself this afternoon. He stood in his place and said that he realized fully that in this election campaign the real issue outside of Saskatchewan is going to be the Saskatchewan government. I do not think he did himself justice.
If I were a resident of that province I would not care what government was in power. If that government was doing a decent job I would have sufficient patriotism and loyalty to my own province to say that the people of Saskatchewan were working out their own destiny under great difficulty and had made progress to such and such an extent.


John Ewen Sinclair: Can the hon. member say that about Angus L. Macdonald's government?


Clarence Gillis: I do not believe in lying just for the purpose of being patriotic.


John Ewen Sinclair: Can the hon. member say that about the Prime Minister's government?


Clarence Gillis: If the Prime Minister demonstrates to us that he is going to do something that is a step forward we will give him credit where credit is due. We will back him in any legislation they are proposing to that end, but not being a lawyer-


John Ewen Sinclair: Nor am I.


Clarence Gillis: -or a trained twister, I like to face facts. This afternoon, when the hon. member for Lake Centre (Mr. Diefenbaker) was trying to prove to the house, and for the purpose of the record, what he considered to be the result of certain things that the gov-
The Budget-Mr. Gillis eminent of Saskatchewan have tried to do in the field of industry, where they have attempted to do something to establish industry where there was none, he placed a lot of figures on the record to prove that the whole experiment was a failure. I noticed, however, that he did not give the authority for any of the figures that he used. He had a piece of paper in his hand, but what authority was behind the figures he gave remains to be revealed as far as we are concerned.
I listened to the hon. member for Lake Centre very carefully. During the Easter recess I visited the province of Saskatchewan and held meetings there. I went there for the purpose of seeing for myself exactly what was going on. The last time I was there was in 1944, and I wanted to have a look and see for myself what progress they had made.
I attended a meeting one night with the minister of education of that province. From the platform I heard him give a report to the meeting on the progress that the government had made in the very field that my hon. friend discussed this afternoon. That report revealed a completely different picture. That is,why I was so surprised that a man from that province, where they are making progress, would endeavour to discredit what is going on there.


John George Diefenbaker: Tell the truth.


Clarence Gillis: I am going to tell the truth, in so far as one can, you see.


John George Diefenbaker: Right from the government records.


Clarence Gillis: Unfortunately one generally finds what one is looking for if one does not check the facts closely enough. My hon. friend, looking down at the mud in his own province, and seeing everything through political glasses, naturally sees and finds the things he is looking for.


John Ewen Sinclair: That is the national C.C.F. outlook on business across the country.


Clarence Gillis: My friend, the hon. member for Vancouver North, is a rather funny mixture. I listened to him last night, and I thought he did a very good job because he stuck to documents and stated facts. I thought he did an excellent job, but there are other times when he appears to go adrift and lose his anchor. It is hard to understand his coming to the defence of his arch enemy, the Tories, at this particular time.


Mr. Young:: Coalition.


Clarence Gillis: Of course the last vote indicated pretty well that the Tories on both sides of
2604

The Budget-Mr. Gillis
the house stuck together in defending the Globe and Mail monopoly in the newspaper industry.


John Ewen Sinclair: Not I.


Clarence Gillis: No, you voted Liberal, and I cannot understand your supporting the Tories now. I have here in documentary form the answer to what my friend, the hon. member for Lake Centre, had to say this afternoon, and it certainly does not show the picture that he painted. For the purpose of the record, and in fairness to the government of his own province, I am going to put on the record some figures that tell a completely different story. For example, I have in mind the annual report and financial statement of the Saskatchewan power commission.


John George Diefenbaker: We have had a power commission for years.


Clarence Gillis: For 1948-wait till I finish. Wait till I tell you what it was like when you had it. That power commission operated under both Liberal and Tory governments. This is the report of the power commission for 1948. I am only going to go back to 1944 when the C.C.F. government took it over. At that time it was a conglomeration of small private companies, but for all practical purposes the whole thing was operated and managed by governments, both Liberal and Tory. In 1944, when the C.C.F. government took over the power commission, there was a deficit of $231,417.67. The power commission was in debt to that extent. It was under Liberal government management at the time. In 1948, after operating under the present government of Saskatchewan, it showed a profit of $1,400,218.41.


John George Diefenbaker: Would the hon. member permit a question?


Clarence Gillis: Besides wiping out the deficit that they took over.


John George Diefenbaker: Would the hon. member allow a question?


Clarence Gillis: Yes.


John George Diefenbaker: How many active and profitable power companies did they take over during that period? Seven?


Clarence Gillis: I think the answer was given a moment ago. I said this commission was operated-


Mr. Ross (St. Paul's):: Answer the question. Mr. Gillis: They took the whole thing over from the provincial government, wiped out the deficit that had accumulated, and now show an accumulated surplus of $1,400,218.41.


Douglas Gooderham Ross: Will the hon. member answer the question?


Clarence Gillis: No, sit down; you are rocking the ship. In addition to that, I want to stress that, during the period of four years when they wiped out the deficit and established the surplus I have just indicated, they cut the power rates to the consumer four times, and relieved the people of Saskatchewan to that extent.


John George Diefenbaker: How many power companies did they take over?


Clarence Gillis: In addition to that they have expanded the services. There is a short statement to be found at page 6 of the same report, and a schedule indicating the increase in the number of meters in service at the end of December of each year. I am only going back to 1944, although they are all here from 1929 onward. In 1944, when the present government of Saskatchewan took over the operation of the power commission in that province, there were 12,989 people using meters. In 1948 there were 51,237 people using the services. This is the power commission report of the province of Saskatchewan.


Arthur Leroy Smith: You know that they bought the international utilities plants.


Clarence Gillis: So you see, Mr. Speaker-


Mr. Cockeram:: Mr. Speaker-


Clarence Gillis: Tell this fellow to sit down.


Alan Cockeram: May I ask the hon. member a question?


The Acting Speaker (Mr. Golding):: Order.


Clarence Gillis: I listened very patiently this afternoon to the hon. member for Lake Centre.


Alan Cockeram: Why not tell us the truth right now? Tell us how many new customers you took over.


Clarence Gillis: I am referring to the 1948 report of the power commission of the province of Saskatchewan. This afternoon the hon. member for Lake Centre merely talked at random, and gave us no authority for any figures that he put on the record. He went on and painted a picture of blue ruin as far as all these industries were concerned.
I have here the balance sheet of the industries he talked about this afternoon. It is up to date to the end of 1948, and this is also an authoritative document. It comes from the office of the chief industrial executive, Saskatchewan legislative building, where the office is located. It deals with the power commission, the operation of telephones, minerals, lakes and forests, marketing services, transportation, and so forth, right down to the insurance offices. I am not going to read all the figures that are here.

It would be too lengthy to do so, but I am going to read some of these figures for my hon. friends to the right, the free enterprisers who do not exist any more, the backers and protectors of monopoly enterprise, squeezing out the little fellows.


Alan Cockeram: The C.C.F. and the Toronto Star.


Clarence Gillis: In the whole operation that my friend, the hon. member for Lake Centre, discussed this afternoon, in the whole field of industry that was taken over or established by the Saskatchewan government, there is a total investment of $35,540,504. That is the total capital investment.


John George Diefenbaker: How much in power?


Clarence Gillis: 


Some hon. Members:: Oh, oh.


Clarence Gillis: Just a minute; don't groan so much. There is an investment of approximately $20 million; the first figure I gave was the profit.


John George Diefenbaker: And how much in telephones?


Clarence Gillis: There is an operating profit in the power commission of approximately six per cent on the capital investment.


John Ewen Sinclair: Is the C.C.F. working for profit?


Clarence Gillis: The capital investment in telephones is $8 million in round figures, and the operating profit on that capital investment was $1,608,368.50 or 18-3 per cent.


John George Diefenbaker: They always had a profit on the telephones.


Clarence Gillis: I do not want to deal with them all, since there are quite a few; I just want to give the over-all picture. To pick out one or two is not fair. If you started an examination of Dosco tomorrow, with all its ramifications stretching from Sydney, Nova Scotia, clear out to British Columbia, if you looked into its fifty subsidiaries one by one, I wonder how many would be solvent if they were not carried by others, where the people produce more and are exploited to a greater extent.


John George Diefenbaker: I thought you believed all companies made profits.


Clarence Gillis: Oh, no. I am going to give the other side of the picture. I said there was a total over-all investment on the part of the Saskatchewan government of $35,540,504. The profit on that over-all operation, without picking out some little weak business they are trying to develop, was $3,152,502.70, or an operating profit of nine per cent in the overall picture. I do not think my friend would
20087-165J
The Budget-Mr. Gillis say that is bad business. A return of nine per cent on your investment in anything today is pretty fair, I think.


John George Diefenbaker: I was dealing with competitive enterprise.


Clarence Gillis: I will show you the picture in other provinces where they have free enterprise governments. The thing I like about the people of Saskatchewan, who are doing that job, is that they do not think they have the solution to all our problems.


John Ewen Sinclair: They used to.


Clarence Gillis: No, they did not. They have been in power in that province for only four years. In Saskatchewan they took over one of the most difficult provinces in natural resources and very little in the field of industry. Nevertheless they have made a huge success of it.


John Ewen Sinclair: Boot factories, tanneries, fish boards and so on.


Clarence Gillis: They did not have the experience of the parties on both this and the other side of the house, of being in power for the last seventy-five years or so in this country, with the old machine you are defending which the monopolies of this country took from you; of failure after failure; of fifteen years of depression with a million unemployed and the rest on the verge of starvation. That is the record of the system you fellows are defending. We have had two wars in one lifetime. It seems the only solution is to send them to war when you are stuck; no brains, no initiative, no attempt made to change things and use the resources of this country. Take it out in destruction. I believe the four-year experiment carried on by the Saskatchewan government certainly should be a revelation to most of the people here if they honestly want to do something along humanitarian lines. Tommy Douglas, who sat in this house with us for a considerable time, did not go around this country boasting that we had found the solution to everything, that this was the Utopia. It is a matter of hard work. He was speaking to the Rotary club in Montreal on April 20-


John George Diefenbaker: And he was in New York recently trying to get money.


Clarence Gillis: That is all right; the Minister of Finance (Mr. Abbott) was in debt to the United States to the extent of a billion dollars only a few months ago, when he initiated his austerity program. That is all right; that is financial manipulation under your present system, and it will go on as long as the system lasts. Let me tell you that you cannot have one government, an honest government, using the resources of this country on the

The Budget-Mr. Gillis basis of need while you have eight other governments in this country still carrying on under the old machine that has failed us during most of our lifetime. Until such time as that experiment is made on a national basis, those who are trying to carry it out on a provincial basis are going to have to struggle and sacrifice, until all the people are prepared to go out and change things from what they are to what they should be in a country rich in everything requisite to life.


John Ewen Sinclair: Douglas didn't say that in 1944.


Clarence Gillis: He was my seatmate for four years, and those were his beliefs. When speaking to the Rotary club of Montreal on April 20 on this business of co-operative or government enterprise, he said that in his own province they were operating a telephone service, an electric service, a bus transportation system and were also in timber, furs and insurance. Only one of the eleven government-owned firms, the tannery and shoe factory, had proved a failure; the other ten had shown profits of $5 million in 1947 and $3,132,000 in 1948. Then this newspaper report goes on:
"We are not suggesting we have the answer to all our social and economic problems," Premier Douglas concluded, "but we are seeking the answer."
He told them there, mind you, that since 1947 he went back to the extent of approximately $2 million. He also told them he did not consider that they had all the answers, but that they were seeking the answers.


John Ewen Sinclair: He was in New York trying to borrow money.


Clarence Gillis: He is forced to do that by the present federal government; and until such time as we all honestly seek the answers we are going to have the kind of skulduggery that we are experiencing today. Then, speaking in his own legislature in February, Douglas said practically the same thing. He said:
Of those businesses which have already been set up, I want to explain frankly that three of them, accounting for five per cent of the capital investment in crown companies, are problem children.
These are the fish board, tannery and shoe factory and the woollen mill. Another six, accounting for seven per cent of the investment, have yet to prove themselves. And seven, accounting for 88 per cent of investment, have definitely proved successful.
Well, is that not the experience in all business? There are ups and downs; there is a greater demand and a greater market for a certain product, and a greater mark-up on some than on others. The lesson to learn here is that if the fish board did not measure up to expectations it was because the fish in the inland lakes did not prove marketable in the United States. The woollen mill was a crown 
company set up where nothing existed before. I would like to ask my hon. friends if that was not a better experiment than slave camps for the unemployed at 20 cents a day. It was a case of trying that sort of thing, using the resources of the province to enable people to go to work and earn a dollar honestly and retain their dignity rather than seeking relief or the other ways out which cause our people to become demoralized.


John Ewen Sinclair: Why didn't he keep them going?


Clarence Gillis: They are keeping them going. These plants are not closed down. I was in that province last week; I visited those plants, and they are still operating.


John George Diefenbaker: They are closed.


Clarence Gillis: They are not; they are operating with a reduced staff, and all this business about closing them is not correct. Now let us look at the other side of the picture, at this business of free enterprise, which is neither free nor enterprise.


Arthur Leroy Smith: Will the hon.
member permit one question?


Clarence Gillis: Yes, because it will likely be sensible.


Arthur Leroy Smith: Don't worry; I shall make it sensible. These enterprises in Saskatchewan which have shown a profit, were they not all government monopolies?


Clarence Gillis: These enterprises in Saskatchewan-


Arthur Leroy Smith: Telephone and power, all monopolies.


Clarence Gillis: If it is a monopoly now, it was a monopoly when the government took it over. Under the former governments it was a monopoly.


John Ewen Sinclair: Insurance services.


Clarence Gillis: Insurance is not a monopoly and neither is the telephone. You have traveled in that province. In so far as the expansion of their telephone system is concerned, they are still pioneering.


Arthur Leroy Smith: It is a monopoly.


Clarence Gillis: Simply because the government of Saskatchewan has had to take it over, it cannot be called a monopoly. The service has been extended. It was taken over because you could not get risk capital to do it. The government has reduced the rates, as I pointed out, and greatly extended the service. It would never have been done in that province under free enterprise. Since free enterprise became part of the Canadian set-up there has been an opportunity of doing that,

but it was not done. It was not being done by risk capital under the other governments, as was clearly indicated.


John Ewen Sinclair: Will the hon. member permit me one question?


Clarence Gillis: Yes.


John Ewen Sinclair: My question is supplementary to the one asked by the member for Calgary West (Mr. Smith). I will put it this way: Were the four enterprises which went broke not competing with private firms? Were they not firms selling boots, hides and blankets? Those four that went broke were not monopolies but were competing with private enterprise. Was not that the fact?


Clarence Gillis: No.


Mrs. Strum:: Those are manufacturing enterprises.


Clarence Gillis: That is not a correct statement.


John Ewen Sinclair: There are woollen mills in Canada and you are competing with them.


Clarence Gillis: In the first place, none of those enterprises went broke. Secondly, none of them are closed down. A few days ago when I was in Regina a government representative was carrying on negotiations with the members of the union for a wage scale in the woollen mill. A few have been laid off to reduce operating costs, but the great majority of the employees are still there.


John Ewen Sinclair: The caretakers?


Clarence Gillis: No; there were two or three people laid off. Right now a contract is being negotiated for the woollen mill.


Gladys Grace Mae Strum: Visit it on your way home.


John Ewen Sinclair: I should like to do so.


Clarence Gillis: The trouble with my hon. friends is that they are the victims of their own press.


Stanley Howard Knowles: The Globe and Mail.


Clarence Gillis: Yes. They just supported the Globe and Mail set-up in the field of the monopoly press. Already there is one in Nova Scotia. For some considerable time the press of this country has been trying to prove that the government of Saskatchewan has been a failure. It was for that reason I went out to have a look at it. I do not have to listen to the editor of the Sydney Post-Record, who hibernates in Sydney, telling the people of this country that all these places are closed up. They are not. I was there a week ago and I saw them.
As I pointed out, the few that are in difficulties represent no more than five per cent of the total capital invested in that field. The job that has been done from
The Budget-Mr. Gillis scratch, instead of deserving criticism from us in this house, who must realize we have to make changes in the economic structure on this continent if we are to live in the world I see developing, should be studied to ascertain whether that thing could work. If it does work it is a Canadian pattern that could be adopted all over this country.
I should like to take a look at the other side of the picture, where there have been free enterprise governments, and give you a few figures concerning commercial failures in the last four years.


John George Diefenbaker: I thought they always got profits.


Clarence Gillis: No. What you fail to understand, my dear little unsophisticated friend, is that this system of enterprise today is not free. Today the big fellow is gobbling up the little fellow. Let the big shipyard operator over here listen and I will give him a few figures.


Arthur Leroy Smith: Are you pointing at me? Thanks very much, sir.


Clarence Gillis: These are the figures for commercial failures during the calendar year 1941 as published by the dominion bureau of statistics. This report contains the figures from 1936 but I am not going to put them all on the record. I am going to take the totals for the years 1945 to 1948, and I think that is a fair comparison with what has happened in Saskatchewan. I am going to put these figures on the record province by province.
Commercial failures in the province of Prince Edward Island, where you would not think there was anything, amounted to fifteen. These commercial failures have happened even under Mr. Jones' management. In Nova Scotia, under our great Angus, there have been twenty-one commercial failures.


John Ewen Sinclair: What type of firms?


Mr. McCann:: What size of firms?


Mr. Isnor:: We have not had a failure in Nova Scotia.


Clarence Gillis: Now they are jumping up on both sides of the house. They do not like to hear the facts being put on the record.


Alan Cockeram: We want the facts as they are.


Clarence Gillis: I hope you are not suggesting the dominion bureau of statistics does not publish the facts.


Douglas Gooderham Ross: Give us the value.


Clarence Gillis: We did not give you the value in Saskatchewan. You cannot take it now.

The Budget-Mr. Gillis At the mere mention of twenty-one failures in Nova Scotia, up jumps the protector of free enterprise, the senior member for Halifax (Mr. Isnor). In New Brunswick there were twenty-three commercial failures.


Douglas Gooderham Ross: What was the value?


Clarence Gillis: You would not understand if I told you. In the province of Quebec there were 1,496 commercial failures, and that is under the Duplessis government.


Douglas Gooderham Ross: What was the value?


Clarence Gillis: In Ontario there were two hundred and thirty-five commercial failures; Manitoba, fifteen commercial failures; Saskatchewan, six commercial failures; Alberta, twenty-two commercial failures; British Columbia, from which the hon. member for Vancouver North (Mr. Sinclair) comes, eighty-five commercial failures. The total for Canada was 19,098.
Let me also point to a trend in this matter. I will take it for the whole of Canada for the years I have just given. In 1946, there were 278 failures; in 1947, 545; in 1948, 813. That clearly indicates what I said a moment ago to the member for Lake Centre (Mr. Diefenbaker), that the big fellow is swallowing up the little fellow. It is there that you get your commercial failures, and the trend is towards monopoly all the time. Eaton's and Simpson's, the chain stores, are taking over in the field of distribution. The little fellow who does not go along and make his mark-up and do what he is told by the manufacturer who supplies him is told:	"Get in
line, Willie, or no more goods for you." The little fellow is folded up. It is neither free nor enterprise.


Douglas Gooderham Ross: May I ask the hon. gentleman a question?


Clarence Gillis: No, I do not want to listen to you.


Douglas Gooderham Ross: May I ask a question?


Clarence Gillis: My time is getting short.


The Acting Speaker (Mr. Golding):: Order.


John Ewen Sinclair: May I ask a question?


Clarence Gillis: Yes.


John Ewen Sinclair: I should like to ask a question concerning these figures, and that is, is private enterprise all profit? There is one great feature in private enterprise and that is that people lose money as well as make money.


The Acting Speaker (Mr. Golding):: Order. I should like all hon. members to cease interrupting the member who has the floor. It is not in order and I believe all hon. members know it.


Stanley Howard Knowles: Which hon. member has the floor?


Clarence Gillis: Thank you, Mr. Speaker. I do not mind it a bit; I like it. The hon. member for Vancouver North (Mr. Sinclair) asked me a question and I said I would try to answer it. His question was-


Douglas Gooderham Ross: May I ask a question?


Clarence Gillis: The leader of our party and the members of this group have always suggested that private enterprise, or free enterprise, if you wish-


John Ewen Sinclair: Competition.


Clarence Gillis: -which is something that does not exist, have always made a lot of money, and the question has been asked why. The answer to that is that there is no longer such a thing as free enterprise in this country. There is no such thing as private enterprise. What we have in this country today is monopoly enterprise, where a small group at the top can weed out the little fellow where there was competition. Where is there any competition in this country today in the field of distributing from Ontario and Quebec to the rest of the country in practically everything that you eat and wear? Where is the competition? The competition that you suspect or think of is from one little grocery store to the other. There is no such thing as competition. The manufacturers of this country, who supply those who retail and sell, fix the price of the products and decide what you are to sell it for, and you sell it for that or else you get out. Take the coal industry in this country today, or the steel industry.


Gordon Benjamin Isnor: There are no fixed prices. There is not a single fixed price.


Clarence Gillis: Take coal, steel or any of our essential commodities. The price is dictated. There is no competition. There is practically one organization in every field which controls every commodity that is used in this country today.


John Ewen Sinclair: May I give one big example, the biggest of all, automobiles. You say there is no competition between the great automobile firms of Canada?


Clarence Gillis: No, I do not think there is.


John Ewen Sinclair: They get together and fix prices?


Clarence Gillis: Certainly they do. Do you mean to tell me that there is any competition between Ford, General Motors and Chrysler? Certainly there is not.


John Ewen Sinclair: How naive.


Clarence Gillis: Today there is a shortage. You cannot get cars. It is a buyers' market.

People are hunting for cars. They are not in competition with one another, not by a long shot. The only thing that is uniform in the prices of automobiles is the tax charged by the Canadian government. That is uniform.


John Ewen Sinclair: The prices are not uniform; the prices are different.


The Acting Speaker (Mr. Golding):: I ask
hon. members to refrain from interrupting the speaker who has the floor. It is not proper.


John Ewen Sinclair: On a point of order, I did ask permission.


The Acting Speaker (Mr. Golding):: I ask
the hon. member to refrain from interrupting the speaker who has the floor.


John Ewen Sinclair: I did ask permission. He gave his permission. I am afraid you did not hear it, sir, at that distance.


The Acting Speaker (Mr. Golding):: I must ask hon. members to refrain from interrupting any more.


Clarence Gillis: I think I have proved conclusively for the record of this house that my hon. friends to the right, who are still living in the dark ages in so far as economics are concerned, were absolutely inaccurate in the statements made by the hon. gentleman who spoke for them this afternoon. I am going to let the matter rest there. I was provoked into this sideline discussion by the remarks of the hon. member for Lake Centre (Mr. Diefenbaker) because I realized he was making a speech for the record, a political speech to be distributed, and if someone did not answer it in this house it would be the theme song of the Tory party in provinces west and east where there do not happen to be too many C.C.F. members to tell exactly what is going on in Saskatchewan.
I am sorry the Minister of Finance (Mr. Abbott) is not in his seat. I am not going to start to beat the budget from the financial point of view. I think the hon. member for Rosetown-Biggar (Mr. Coldwell) did that very successfully and there is no need of repeating what he said at that time. He did make a suggestion which I think more of us should elaborate on. His suggestion was to the effect that the budget itself should not be just a bookkeeping record of the government, of their income and expenditures. In addition, the Minister of Finance should bring in a capital budget and show the Canadian people and hon. members exactly what he proposes in the way of developing this country. He did make the statement that he had a shelf of public works. Nobody knows what they are. Across this country today unemployment is developing, and as time goes on that trend will become more serious.
The Budget-Mr. Gillis


An hon. Member:: That is not so.


Clarence Gillis: I know. I read; you fellows do not.


An hon. Member:: They read the Globe and Mail.


Arthur Leroy Smith: I did not say
a word.


John Ewen Sinclair: He is suspicious of us.


Clarence Gillis: There is going to be unemployment. You cannot avoid it. They are watching what is going on in the United States today. With the downward trend of prices in that country you will find, if you are watching your unemployment insurance figures in this country and in certain of the provinces-


Thomas Vincent Grant: More wishful thinking.


Clarence Gillis: -you will find that there is unemployment, and it may catch up to you even before the election. I know that hon. members from British Columbia are fully aware of it.


John Ewen Sinclair: Not today.


Clarence Gillis: There is quite a lot of it; some 36,000 were unemployed in Vancouver not so long ago.


John Ewen Sinclair: Two months ago.


Clarence Gillis: They are starting to go back in the bush now and we are getting away from it a bit, but we are not away from it all. Either the Minister of Finance or the Minister of Reconstruction and Supply should have some plans to deal with unemployment. There is a lot of work to be done in this country, and there are many people who could be put to work. There should be a plan for each one of the provinces so that the provincial governments and the people generally would know exactly what will happen if certain industries lay off men because of the piling up of goods. That is not done, but it should be done. For example, in my own province the unemployment insurance figures are four times as great as they were last year. That means that four times as many people are drawing unemployment insurance in Nova Scotia at this time as there were at this time last year. The unemployment insurance figures do not give the whole picture of unemployment because there are hundreds of men who run out of unemployment insurance. There are hundreds of others who are seeking employment and who never qualify for unemployment insurance. If you take these unemployment insurance figures alone it indicates an upward trend in that field. Some hon. member suggested that it was only wishful thinking. I would remind hon. members from Nova Scotia particularly-
2610	HOUSE OF
The Budget-Mr. Gillis


Stanley Howard Knowles: It was the senator from Prince Edward Island.


Clarence Gillis: I did not expect him to be very much interested. The session opened in January. I suppose that every hon. member from Nova Scotia has received telegrams and letters from that province pointing out that the basic industry of that province has been working about half time owing to the lack of markets. Mind you, that is not considered unemployment.


The Acting Speaker (Mr. Golding):: Order. I must remind the hon. member that his time has expired.


John Ewen Sinclair: Go on. There were a lot of interruptions.


Arthur Leroy Smith: Go on. This is good.


Clarence Gillis: Thank you. I had a lot more to say but I shall cut it out.


John Ewen Sinclair: You have had a lot of interruptions.


Alan Cockeram: Get down to the budget pretty soon.


Clarence Gillis: I am sorry to be taking up so much time and not talking about gold, which is a very useful product. It is dug out of the ground in Canada and buried in the United States, but somebody makes a lot of money out of it.


Douglas Gooderham Ross: Get down to the budget.


Clarence Gillis: You would not know even if I were there. The thing that I cannot understand is why we should have a lack of markets in a basic industry in a province, at a time when we import so much coal from the United States. We imported coal to the value of $143 million last year at a time when we were producing a small amount of coal in Nova Scotia, with the mines working on half time. That is reminiscent of the thirties. Many people in that province cannot understand why this should be so. The only alibi offered by the Minister of Trade and Commerce (Mr. Howe) was, "Well, this has been a mild winter, and the railways are not burning as much coal". That is not an answer at all. It shows faulty planning. There is no plan to market the product of one of the basic industries, an industry which is basic to one province in this country.
I had intended to say more, but with the permission of the house I should like to make one observation with regard to steel. In my view the Minister of Trade and Commerce before dissolution of this parliament should

clarify the position of steel in Canada. The speech from the throne indicates that the government was anxious to expand that industry. To that extent they were prepared to match dollar for dollar with the industry in any expansion program which might be undertaken.
The minister stated in reply to a question from myself a month or so ago that the only section of the industry which had made application for that grant was Stelco, and that neither Dosco nor Algoma-the other two basic industries in the country-had indicated whether they would make use of it or not.
In the last issue of the Financial Post there was a statement to the effect that steel was becoming more plentiful, and that to that extent the federal government was likely to withdraw the dollar for dollar proposal it had made for the purpose of expanding the steel industry. There is a large steel plant in my constituency, one which produces a large share of Canada's basic steel, and I should like to know from the minister before I leave Ottawa whether Dosco made any application to expand its plant on the basis set out in the speech from the throne and, if not, why not? I should like to know if there is any truth in the statement which appears in the Financial Post that the government may withdraw this program of financial support for the purpose of expanding the industry. I am concerned about it, because I fully believe that the only solution to the problem of Nova Scotia is the expansion of the steel industry at Sydney. It uses a large percentage of the coal produced in that province. Unless that steel industry is expanded, I do not see a bright future for the province.
Secondly, the iron ore deposits in Labrador and Ungava are most important to this country. I note that a large number of American investors are coming into that industry in eastern Canada. I believe that five of the directors of Dosco are Americans; they are buying heavily into that stock.
With the ore situation such as it is on the North American continent, I believe that in the not far distant future there will be shifts of major steel plants to the east coast. I suggest we should try to hold our own industries in this country, and utilize the iron ore deposits in Ungava and Labrador for the purpose of building this country into a great industrial nation, rather than allowing its resources to slip to the other side of the border.
I should be pleased if the Minister of Trade and Commerce would look at my remarks in Hansard, and before the session

closes make some kind of statement as to the future of steel, particularly in the matter of expansion. May I thank the house for listening patiently at this time.


Mr. W. F. Kuhl (Jasper-Edson):: Mr. Speaker, I am tempted to get into the controversy which has been taking place regarding the merits of public enterprise as compared with private enterprise. However, if I became too much involved in that, perhaps I would forget to return to the observations I had intended to make. Nevertheless there are one or two remarks I feel compelled to make considering the controversy which has just taken place.
I believe that those on both sides of the argument-the C.C.F., who champion public enterprise, and the Liberals and Conservatives, who support the present orthodox policy-are both groping in the dark. I say that for this reason: The success of either public or private enterprise in the final analysis depends upon markets. It depends upon the ability of people to purchase the products produced. That is the feature which I believe hon. members of the C.C.F. in particular overlook when they constantly advocate public enterprise.
Neither enterprise can succeed completely unless there is sufficient purchasing power in circulation in the community to absorb the total production. Again and again we in this corner have asserted that in normal times industry never distributes sufficient purchasing power to buy back the total production of the country. We suffer from a chronic shortage of purchasing power. What both orthodox economists-those of the Liberals and Progressive Conservatives on the one hand, and the C.C.F. on the other-overlook, is the relationship of purchasing power to production. They overlook the part played by those who control the monetary policies of the country. That is one of the most important features to observe at all times- that is, to see that there is a proper relationship between money in the hands of the people and goods which they have to buy. Therefore, I suggest, the people of Canada will never have economic justice, whether things are produced publicly or privately, until purchasing power equates producing power.
Before I refer to that part of the budget to which I wish to make special reference, I should like to place on record a letter which I received recently from Mr. R. B. Morrison, secretary of the trans-Canada highway association, Yellowhead route. Doubtless all hon. members received this correspondence; but inasmuch as this route would pass
The Budget-Mr. Kuhl through the constituency of Jasper-Edson, which I have the honour to represent, I feel the facts contained in the letter should be placed on record.
Doubtless the major responsibility for determining the route lies with the provincial governments, and the pressure should be applied to those governments. Nevertheless the association which sponsors the Yellow-head route feels that the dominion government should consider the submissions they have made respecting the preference for this route, inasmuch as money is being provided by the dominion government.	[DOT]
I suggest that much credit must be given this association for the work they have done in ascertaining the facts concerning the desirability of the various routes and for the pressure they have applied to see that the route which is chosen is the one which in their opinion serves the interests of the greatest number of people.
Personally I see no reason why all the routes that are proposed cannot be built. I believe the people along any particular route are entitled to have the highway just as much as the people along any other route. As I say,
I see no reason why all routes should not be built, especially if there is to be a so-called unemployment problem. I want to place this letter on the record because it sets out the reasons why the Yellowhead route is the choicest of those that have been suggested. The letter reads:
As secretary of the Edmonton committee of the trans-Canada highway system association (Yellowhead route) I have been instructed to write you concerning the forthcoming debate on the trans-Canada highway bill, your part in this and facts you may need.
We ask that you insist on complete and impartial investigation of the entire question by a fact-finding body independent of parliament before any decision is made concerning routes. Naturally we also will appreciate direct support of the Yellowhead route; but our major problem now is to get impartial information before the house. For such argument as you may find necessary for either stand, I trust you will not object to our reviewing the true facts.
The Yellowhead route covers suggested highways from Winnipeg to Vancouver and Prince Rupert via Saskatoon, Edmonton and Jasper. As compared to the Kicking Horse Pass route our claims for the Yellowhead route are easily proved.
It is cheaper road to construct and to maintain.
More than half of the population, area, oil and parks of the four western provinces are tributary to the Yellowhead route.
It serves the new development in the Canadian northwest including Peace river agriculture, Mc-Murray tar sands. Elk Point salt, Yellowknife gold, Great Bear uranium and the Alaska tourist.
It covers the important military requirements- three Pacific ports, essential northern airfields and supplies and the projected radar screen.
We believe that the people of the whole of Canada have a right to expect that the trans-Canada high-

The Budget-Mr. Kuhl way will be so located as readily to serve the largest number of Canadians, and thus make its utmost contribution to the unity of the nation; so as to facilitate the business of the country; so as to make accessible to Canadians and visitors alike the greatest possible number of national and provincial parks; and, since the defence of Canada must loom large in any decision, so as to be of the utmost strategic value.
Let us examine the facts.
First a word about cost since it is inconceivable that a decision on routes could be made totally ignoring the lower cost factors both for construction and maintenance which the Yellowhead route offers over the Kicking Horse route. East of the junction of the two roads at Kamloops, the Yellowhead route follows wide peaceful valleys where narrow shelves, sheer cliffs and overhands, steep grades, abrupt turns, and impassable snows are practically unknown. The highest elevation is 3,717 feet (three hundred feet above that of the city of Calgary), whereas approximately one hundred and seventy-five rugged miles of Kicking Horse route lie between 3,717 and 5,337 feet elevation. The average of winter reports on snowfall between Jasper and Kamloops is four feet eleven inches-that between lake Louise and Kamloops is eleven feet four inches. We urge you to study the established facts of elevation and snowfall shown on the graphs I am enclosing.
It is obvious that routing the trans-Canada highway through the central portion of the Canadian west will knit the country together in a way that the Kicking Horse route to the south can never do. What is not so well known is the fact that even in Saskatchewan and Alberta the Yellowhead highway serves sixty per cent of the population as compared to the forty per cent for the other route. The present trend of population northward suggests that the future ratio could easily be much greater.
Nor is the Yellowhead route less useful to business and commerce. It traverses the finest agricultural district of western Canada-the Evergreen belt. The fertility of the Peace River district is legendary. Reasonable estimates of liquid bitumen at McMurray indicate enough road topping material for generations yet to come. The ore belts of northern Manitoba and the Northwest Territories have been barely scratched, yet show lead, zinc, copper, silver and gold to match the best in Ontario and Quebec along with materials for all the atom bombs yet produced. And, of course, the Edmonton oil fields bid fair to alter the entire economy of the west. Production now is running more than double that of Turner valley. The president of Imperial Oil recently forecast an additional 400 wells for 1949. This indicates more than double present production and, when transportation facilities are available, that Alberta will be an oil exporting province producing $100,000,000 in oil each year. Nor is the end yet.
The Yellowhead route is a natural for our vacation industry permitting, as it does, our citizens and visitors to explore and enjoy the scenic beauty of Canada. It follows the Evergreen route, and serves the Alaska highway, the Great Slave lake highway and four national and five provincial parks, constituting by far the largest park area west of the great lakes.
From a military standpoint, the Yellowhead route is the only route that will provide:
(1)	Access to three all weather Pacific ports- Vancouver and Prince Rupert in Canada and Skag-way via the Alaska highway, with Bella Coola for future development.
(2)	A sound strategic highway readily improved to military standards.

(3)	Cover for radar and air operations from Hudson bay and the port of Churchill to the Arctic and Alaska.
Finally I wish to emphasize that not only do we expect you to voice the needs and opinions of your constituents but we also feel sure that you will recognize it as your duty as part of the government of Canada to provide the people and commerce of your country with a trans-Canada highway that gives the maximum service per dollar expenditure.
It is your responsibility.
Respectfully yours,
R. B. Morrison,
Secretary, Edmonton committee, Trans-Canada Highway System Association, (Yellowhead route)
That letter sets out the arguments that this association have advanced in favour of the Yellowhead route. I think they are very substantial and merit serious consideration.
What I had intended to deal with specifically was the reference made by the Minister of Finance (Mr. Abbott) during his budget address to dominion-provincial relations. Notwithstanding the importance of many other subjects that are covered by the budget and other legislation, I consider that the dominion-provincial issue is the most important internal issue in the Dominion of Canada. I feel that the solution to genuine economic democracy in Canada, as well as political democracy, depends upon a satisfactory solution of the dominion-provincial controversy. I, of course, felt that there would be a more appropriate occasion on which to discuss this subject, but inasmuch as parliament will be dissolved in the near future I wish to take advantage of this occasion to once more place on the record my views and wishes in this matter.
The Minister of Finance certainly left the inference, in the remarks which he made concerning the taxation agreements with the various provinces, that it was an ideal arrangement, and that it was redounding to the very decided advantage of the provinces. I think there is also an implied suggestion that it might be a good thing to have a permanent arrangement of this nature. The future alone will reveal what those who will form the government at Ottawa have in mind with respect to taxation fields. Certainly on this occasion I wish to voice my protest at the manner in which these matters are being dealt with. My greatest concern in the whole controversy over dominion-provincial relations is as to the rights of the individual citizen of the country. I believe I was not sent here primarily to defend the rights of institutions. I believe my primary purpose in being sent here is to defend the rights of the individual citizens of the country. It is from that point of view that I have the greatest concern about the dominion-provincial disagreement.

The actual records, as far as the province of Alberta is concerned, certainly do not seem to indicate that the premier of that province is in favour of a permanent arrangement such as now obtains between the dominion and the provinces. I should like to quote a few sentences from the submission which was made by Premier E. C. Manning to the last dominion-provincial conference. I think this particular submission was one of the most valuable, one of the most enlightening, and one of the best submissions made as to a solution to this particular problem. On page 8 of the submission we find these words: Moreover income tax and corporation tax have in the past been two important fields of provincial revenue, but both have been invaded by the dominion to an extent which, if continued after the expiration of the dominion-provincial tax agreements, will for all practical purposes nullify the provinces' constitutional right to derive revenue by means of direct taxation in these fields. To suggest that the provinces can meet their post-war obligations by means of large-scale public borrowing obviously is no solution to the problem, but merely pushes it into the future with increasing certainty that the results will be even more disastrous a few years hence. Obviously the present situation is absurd, and places both provincial and municipal governments in an intolerable position. The whole situation resolves itself down to one indisputable fact that the major problem confronting all governments today is primarily financial, and, in so far as provincial and municipal governments are concerned, it is absolutely impossible for them to discharge their post-war responsibilities within the confines of the constitution and the laws of Canada unless the necessary additional revenue is made available to them. Until this absurd situation is corrected no amount of reshuffling of our responsibilities or of our inadequate revenues will solve our problem and ensure the people of Canada a post-war economy in which their standard of living and the measure of their social services will be limited only by the aggregate of their material resources and their combined ability to produce the goods and services they require.
As to jurisdiction and responsibility Mr. Manning on this occasion said these few words:
Like so many seemingly complex problems, the present difficulties in dominion-provincial relations arising out of this situation are relatively simple in origin and stem from a violation of fundamental principles. It is axiomatic that all authority must carry with it corresponding responsibility, and vice versa. Furthermore, responsibility without the means for carrying it out cannot be maintained.
With respect to solutions that are commonly advanced, Premier Manning made this statement:
There are those who maintain that the solution to this problem is for the provinces to surrender to the dominion their constitutional authority over the matters involved, and thereby transfer to the dominion government the financial obligations which attach to the proper discharge of those responsibilities.
This proposal has two obvious weaknesses. First, it does nothing to remove the root causes of the difficulty, but rather seeks to evade the real issue
The Budget-Mr. Kuhl by shifting responsibility for providing social and other public services to the dominion government. Secondly, it violates the basic and fundamental principle of effective democratic government, by centralizing, under the dominion, administrative authority over matters which properly should be under the effective control of the people of the respective provinces.
I would suggest at that point that that statement is quite in contrast to that which was made by the Minister of Finance.
It does not alter the situation to contend that the loss of provincial autonomy would be offset by the fact that the dominion treasury would assume the financial obligations which attach to the administration of such social services. In the last analysis it is the people of Canada who are footing the bill, whether the dominion or the provincial governments extract the revenue from them. For the dominion to assume jurisdiction over all social services would simply mean that the people of Canada, who are the citizens of the respective provinces, would still be paying the bill but would no longer have the effective voice in deciding the nature of the social services to be provided that they have when such services are under the jurisdiction of their provincial and municipal governments.
There are others who contend that the solution to our problem lies in the redistribution of the various fields of taxation as between the dominion and the provinces. Certain adjustments in the fields of public revenue and in the powers of taxation certainly are desirable and necessary, but let us never forget that the mere realignment and redistribution of the powers of government to extract public revenue from the pockets of Canadian business and the Canadian people does not, and cannot, increase by one red cent the amount in those pockets that is available for extraction. In other words, no amount of mere juggling the respective fields of taxation as between dominion, provincial and municipal governments can possibly enhance the ability of the Canadian people either to tax or borrow themselves into an era of permanent postwar prosperity.
Then Premier Manning concluded his submission with a suggestion as to what should be done. I wish to put that suggestion on record and go a little further than he did. At page 11 he said:
In the light of these circumstances the effective solution to our problem obviously requires a policy that goes far beyond the mere adjustment of our respective responsibilities or the reallocation of our present inadequate sources of public revenue. It lies within the sovereign power of the dominion government, through the Bank of Canada, to monetize fully the real wealth of the nation as represented by our abundant national production, and to utilize the financial credit representing the monetization of that real wealth to supplement the ordinary public revenues of the dominion and of the provincial treasuries.
Such a monetary policy, operated within adequate scientific safeguards against both inflation and deflation, would enable the dominion government to ensure to the provinces adequate revenues to discharge fully their constitutional responsibilities without jeopardizing its own financial position, and would, at the same time, remove the necessity for excessive taxation and the accumulation of further public debt. It would put the dominion and the provincial governments in a financial position to implement adequate programs of post-war rehabili-

The Budget-Mr. Kuhl tation and reconstruction, which would raise progressively the standard of living of the Canadian people to the high level which the abundance of our resources and our steadily expanding productive capacity would make physically possible.
I think that was a most worth-while contribution to a solution of the dominion-provincial controversy. I would go one step further, however, and add to that suggestion. I do not feel that this controversy can be settled through dominion-provincial conferences. I agree with the suggestion made in 1935 in the special committee on the British North America Act by the late Norman Rogers, Minister of Labour, and the late Ernest Lapointe, Minister of Justice. At that time a question was asked as to what would be the starting point in a solution. At page 116 of the proceedings of that committee this exchange appears:


Mr. Cowan:: You get back to this: your start is
another interprovincial conference.


Mr. Rogers:: I am afraid it is.


Mr. Lapointe:: There is no doubt about it.
I agree with the suggestion made on that occasion. I can see no solution from further dominion-provincial conferences; and I would go further and make this assertion, as I have on many occasions since becoming a member of this assembly. The provinces of Canada are the only governments which have authority to initiate any conference. I am not going to repeat all the arguments I have presented on numerous occasions, but I reiterate that it is my considered opinion-which I have supported with ample evidence and statements by those regarded as authorities-that at the moment the actual constitutional position is that all authority to govern lies in the hands of the nine provincial governments, and that this has been the situation since December 11, 1931. I know I have been regarded as a sort of crackpot on this subject. Hon. members of this house have referred to my ideas as queer, and similar remarks have been made elsewhere. Nevertheless not a member of this house and no one outside it has attempted to refute either the facts I advanced or the conclusions I drew from those facts; and until someone either in this house or outside it successfully refutes the contentions I have made, I shall continue to believe that I am right.
I wish to introduce the opinion of someone else on this subject. I do not suppose this man would be recognized by anyone as a constitutional authority; nevertheless he is a Canadian who has done a considerable amount of thinking on this subject. At one time I believe he was a press reporter for one of the large daily newspapers in Edmonton; and as far back as 1937 he wrote a letter to my colleague the hon. member for Lethbridge (Mr. Blackmore). I am referring 
to Mr. J. H. Hodson, whose address at that time was Wetaskiwin, Alberta. I believe he sums up the situation in Canada very well, and I subscribe to his statement one hundred per cent. If I may be permitted I should like to read this letter into the record. It is dated March 1, 1937:
Dear Mr. Blackmore:
I am writing you again on the constitutional question-it is one that intrigues me very much and one which I think is most important to the provinces in the way it is dealt with.
For three years the dominion authorities seemed quite satisfied to continue to function under the B.N.A. Act, although it seems to have been the duty of the central government, after the passage of the Statute of Westminster, to notify the provinces of their changed status and the necessity of a federation agreement by which to reclothe with authority a new central government under a proper federation by which to bring into being a commonwealth similar to those which have been created in both South Africa and Australia.
I have been seeking for the cause of the dis-complacency on the constitutional question. I have noted that it was not until Mr. Aberhart loomed large on the political horizon that the Right Hon. R. B. Bennett then Prime Minister endeavoured to bring about a conference of provincial premiers. This for a variety of reasons failed. The next move was to set up a select committee in the House of Commons to investigate and recommend the best way amendments to the B.N.A. Act should be brought about.
This, it appears to me, is an approach to the question with the deliberate intent to establish the B.N.A. Act as the constitution under a new federation without which, except by negative assent, under the act the present federal government is not legally established nor has its powers been properly conferred upon it. The powers under the B.N.A. Act is merely an arrangement made between colonies and authorized by the British House of Commons whose authority in the internal affairs of Canada have been relinquished.
If this were not the case Mr. Mackenzie King would not have been justified in saying in the house on February 9 last, "We take a certain pride in having a status of our own as an autonomous nation with all the powers and rights of a full nation."
This status, of course, was conferred upon the people of Canada and not on the dominion government. It is a peculiar fact and a reflection on the dominion government that the people of Canada have not yet been given an opportunity to accept the sovereign powers which the British House of Commons relinquished in their favour. It seems to me that the sovereign rights at the present moment are resident in the people, and through them in the provincial governments as the most direct agents of the people. There has so far been no invitation to form a federation of provinces since the power to create an independent government was conferred on the people of Canada.
In this session of parliament Mr. Bennett betrayed a good deal of impatient anxiety with regard to the amending of the B.N.A. Act, in spite of the fact that the law officers of the crown in giving evidence before the select committee of his own establishing were definite in their statements as to the necessity of a new constitution, one of them going so far as to intimate that at the present time we have none.
In the same debate, on January 26, it is to be noticed that while Mr. King quoted the views of Prince Edward Island, Manitoba, Saskatchewan,

and British Columbia, he made the following reference to Alberta without quoting that province: "Alberta said that they considered such vital questions should be approached through an exchange of views, by an interprovincial conference." This attitude, I am convinced, is the proper one. I go further, however, and claim that in formulating a new constitution the dominion government has no status at all. It is for the provinces to say what powers shall be conferred on a new federal authority, which by the act of the provinces should have been created as soon as possible after the relinquishment of sovereignty by the British House of Commons to the people of Canada.
It seems to me that the Hon. Mr. Lapointe contradicts his own argument on page 477 of Hansard, February 1, 1937. In one place he says that the dominion is the child and not the father of the provinces. On the same page he says: "but the provinces have exactly the same powers, the same rights, and the same jurisdiction which they had prior to the passing of the Statute of Westminster". If this is the case then the provinces of Canada are still a colony with colonial rights, if those rights are "exactly the same" after as before the passing of the Statute of Westminster. It seems to me the political leaders of the east would like to become the parent of the provinces under a new constitution and to maintain for the provinces the status of colonies subservient to the federal government. This would suit the financial interests and effectively prevent any province from making economic experiments such as Alberta has embarked upon. The danger to the provinces, as I see it, is that the provinces be induced t.o hold a conference and to review the B.N.A. Act and with or without amendment to that act get from the provinces expressions of acquiescence to the terms of the act and thus establish it as the constitution of Canada under the newly acquired sovereign rights conferred upon the people of Canada, on December 11, 1931.
There are some so-called statesmen who believe that the rabble, especially the rabble resident on the prairies, are too unstable to be given too much power, and that a colonial status under an Ottawa government is all that should be given to them.
Yours truly,
J. H. Hodson.
Mr. Speaker, I think this letter summarizes very well the present position in Canada. I agree wholeheartedly with the views expressed by Mr. Hodson. Had I the time I could substantiate the points I have made without very much evidence, as I have done in the past. It is on the record for all to see. Anyone who desires to consult it can do so. As I have said before, until anyone in this house or outside it takes it upon himself to indicate wherein the facts I have adduced are not facts and shows wherein the conclusions at which I have arrived are improper conclusions, I shall continue to believe that the arguments I have advanced are sound.
I suggest, therefore, to all the people of Canada that the only solution to this con-
The Budget-Mr. Kuhl troversy is to start from bedrock, that is by recognizing that since December 11, 1931, the authority to govern in this country has been vested in the provincial governments and that the responsibility to form a federation and authorize a central federal government belongs to the provinces. When a solution is attempted from that angle, then I really believe the problem will be solved properly and we will reach a basis upon which we can have a truly political democracy in this country and will be enabled to obtain an economic democracy.
On motion of Mr. Coyle the debate was adjourned.	.



STANDING COMMITTEE


Mr. E. O. Bertrand (Prescott):: Mr. Speaker, I would ask the leave of the house to revert to motions. I should like to present the second and third reports of the standing committee on standing orders, and move that the reports be concurred in.


Stanley Howard Knowles: There is quite a bit to this report. I think it would be better if notice were given and a motion made tomorrow.


Elie-Oscar Bertrand: The reason for asking concurrence tonight is that if notice is given on the order paper it will have to wait forty-eight hours before it is considered, unless we again ask for leave of the house to adopt the report tomorrow. Of course, it is not meant to rush this matter, but it is important that the necessary legislation be passed before parliament is dissolved.


Mr. Low:: Ask for leave tomorrow.


Stanley Howard Knowles: Asking for leave tomorrow after we have had a chance to look at the report is a little different from asking for leave tonight.


Elie-Oscar Bertrand: That will be quite satisfactory.



BUSINESS OF THE HOUSE

Alphonse Fournier: I move that the house do now adjourn. Tomorrow we shall take up the pipe lines bill and then we shall resume the debate on the budget.
Motion agreed to and the house adjourned at 10.35 p.m.

Wednesday, April 27, 1949