1950-02-20

TRANSFER OF DUTIES


Right Hon. L. S. St. Laurent (Prime Minister):: I should like to table copies of an order in council passed on the 17th of February transferring from the Department of Transport to the Department of Labour the administration of the Merchant Seamen Compensation Act, chapter 58 of the statutes of Canada, 1946.



CRIMINAL CODE


Mr. W. Ross Thatcher (Moose Jaw) moved: for leave to introduce Bill No. 2, to amend the Criminal Code (capital punishment).


Some hon. Members:: Explain.


Wilbert Ross Thatcher: The purpose of this bill is
to abolish capital punishment in Canada and to substitute therefor life imprisonment.
Motion agreed to and bill read the first time.



INDUSTRIAL RELATIONS


Mr. Stanley Knowles (Winnipeg North Centre) moved: for leave to introduce Bill No. 3, to amend the Industrial Relations and Disputes Investigation Act (voluntary revocable check-off).


Some hon. Members:: Explain.


Stanley Howard Knowles: Mr. Speaker, this bill will add a new subsection 3 to section 6 of the Industrial Relations and Disputes Investigation Act. The effect of the new subsection is to provide for the voluntary revocable checkoff of trade union dues.
Motion agreed to and bill read the first time.



CANADA DAY ACT


Mr. A. Phileas Cote (Maiapedia-Malane) moved: for leave to introduce Bill No. 4,
respecting Canada day.


Alcide Côté: This bill is intended to repeal the Dominion Day Act and substitute therefor a Canada day act. The changes are in the title and section 2, where the word "Canada" is substituted for the word "Dominion". For the benefit of those who were not here in the last parliament I should like to inform them that the same bill was introduced in the House of Commons on the 27th day of March, 1946, and was passed on the 4th day of April, 1946.
Motion agreed to and bill read the first time.



CANADIAN WHEAT BOARD ACT


Mr. P. E. Wright (Melfort) moved: for leave to introduce Bill No. 5, to amend the Canadian Wheat Board Act, 1935.


Some hon. Members:: Explain.


Percy Ellis Wright: The effect of this amendment would be to make the port of Churchill a basing point under the act, and place that port in the same position as Port Arthur, Fort William and Vancouver.
Motion agreed to and bill read the first time.



CROWN PROPERTIES


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Has the Minister of Finance received further representations in connection with the proposed payments to municipalities in lieu of taxes on federal properties? If so, is the government prepared to review its policy in the light of any such representations?


Hon. Douglas Abbott (Minister of Finance):: I have received a number of representations of one sort and another, but the policy announced by the government has not been altered as a result of those representations. I might add that regulations to implement the policy as announced have now been prepared, together with forms to be completed by the municipalities setting out information with respect to federal property in their jurisdictions. I hope those regulations will be adopted and made available in the course of a few days.

Inquiries of the Ministry HOUSE OF COMMONS



INQUIRY AS TO PAY INCREASE FOR MEMBERS' STENOGRAPHIC STAFF

[Stage Direction]
On the orders of the day:
Mr. Robert Fair (Battle River):: I should like to address a question to Your Honour. What action has been taken to increase the pay of those employed on the members' stenographic staff?


Mr. Speaker:: I shall be glad to discuss the matter with the hon. member, but it is not customary to address questions to the Speaker when he is in the chair.



INCOME TAX


[Stage Direction]
On the orders of the day:
Mr. G. K. Fraser (Peterborough West):: would like to address a question to the Minister of National Revenue, whose department has been sponsoring spot advertisements on the radio every day. This morning the announcer on CBL said-


Some hon. Members:: Question.


Gordon Knapman Fraser: -that the government would return a generous refund on last year's income tax if the returns were sent in now. My question is, what is generous about returning a person's own money?


Hon. J. J. McCann (Minister of National Revenue):: The announcement is by way of an advertisement, and is not intended to advertise generosity at all.


Gordon Knapman Fraser: That was the statement-"a generous refund".


James Joseph McCann: This step has been taken with a view to getting the returns in quickly in order that the assessments may be made and the refundable portion collected in the months of January, February and March returned as soon as possible. The sooner the returns are in, the sooner the refunds will be made.



RADIO BROADCASTING


[Stage Direction]
On the orders of the day:
Mr. Donald M. Fleming (Eglinion):: May 1
ask the Minister of National Revenue if the government will proceed this session to set up a special committee on radio and the Canadian Broadcasting Corporation?


James Joseph McCann: Yes, Mr. Speaker, it is the inten-
(Mr. Abbott.]

tion of the government to set up the committee as soon as possible, and I expect to place a motion on the order paper this week.



SPEECH FROM THE THRONE


[Stage Direction]
The house resumed, from Friday, February 17, consideration of the motion of Mr. F. H. Larson for an address to His Excellency the Governor General in reply to his speech at the opening of the session.
Mr. George A. Drew (Leader of the Opposition):: Mr. Speaker, in rising to take part in this debate I wish to express my personal respects to the mover (Mr. Larson) and the seconder (Mr. Dumas) of the motion, who. have discharged that duty in keeping with the customs of this debate.
As to the speech from the throne itself, it contains so little of a definite nature that any remarks which may contribute to the effective consideration of our problems necessarily must be related more to what the speech from the throne does not say than to anything it does say.
There was one significant comment in the excellent speech made by the hon. member who moved this motion, and did it so well. He said, at page 27 of Hansard:
I feel that I may be open to criticism for not taking issue with the government on some of the matters of a more contentious nature.
Then he went on to explain why, on balance, he felt justified in approving what they had done. That brief comment, however, reflected what is in the minds of so many members on both sides of this house. There has been widespread and justified criticism of the government since last we met; and that criticism is directed not only to particular acts of omission or commission by this government but also to the very important fact that neither parliament nor the people were given information which the government have admitted they had in their possession for some considerable time. That brings before us an issue which goes to the very root of the established principles of responsible government and, in turn, to the very root of freedom itself.
There comes a time when all wise parliamentary bodies must carefully examine abuses which have crept into their procedure and practices, and correct them before it is too late. Not only here in Canada but in other free nations as well the emergency powers, conferred upon the executive and

intended only for the purpose of meeting the desperate demands of war, were carried forward into the years beyond. Although many of those powers and controls have since then been repealed or diminished, the state of mind and the attitude toward parliament which those powers created do persist to an extent' that may threaten the survival of our parliamentary system.
During the war, governments found it necessary, or claimed that they did, to keep a considerable amount of information to themselves, and, on the grounds of security, refused to parliament information which ordinarily parliament would have not only the right to obtain but the right to be given voluntarily as the basis of informed debate. Men who have been in the habit of treating information as their own special prerogative may find it difficult to throw off this habit, but the time is long past when it can be accepted as an excuse for withholding information from parliament, without serious danger to the continuance of our parliamentary system.
I think every hon. member of this house must be gravely concerned about what has happened in this country since we were last in session, and there should be equally great concern about the suppression of information which should have been given to the representatives of the people in this house. As recently as December 1 the Minister of Trade and Commerce (Mr. Howe) gave a glowing account of the prospects for production, export trade, prices, and employment. It was only on the last day of the session that the Minister of Agriculture (Mr. Gardiner) indicated in some slight degree the extent to which our food exports to the United Kingdom might drop in 1950. That was serious enough in itself. What has happened since then is infinitely more serious. The loss of our assured markets for wheat, bacon, cheese, eggs, and other food exports, has had an immediate and disastrous effect on domestic farm prices. It is hard to realize that it is only a few weeks ago that the government was telling us we had no problem of surplus food products. Now the problem of surplus food, and the threat of even greater surpluses, is endangering our whole agricultural price structure, and threatening the security of our farmers.
The Minister of Agriculture now says that he expected this situation for two years. If that is so, why were we not given this information during the early days of the last session, when steps could have been taken in advance to meet the situation with which we are now confronted? The failure of the government to take effective steps in this matter
The Address-Mr. Drew has produced immediate and serious consequences which are being felt in every part of Canada.
When the trades and labour council of Canada and the Canadian Congress of Labour made a joint representation to the government on January 2, they said:
The unemployment situation in Canada has become so serious as to cause apprehension throughout the nation.
In response to that statement the Department of Labour announced on January 7 that there were 261,000 unemployed, and that- -a considerable portion of the current unemployment results from the continuing growth of the Canadian labour force, rather than from a decline in employment.
On January 19 the Minister of Finance stated that the unemployment situation in Canada was purely seasonal. As recently as January 30 the unemployment insurance commissioner said in Winnipeg-and I quote his words, as reported in the press:
The labour unions are exaggerating the total of unemployed in Canada.
The figures of unemployment released two days ago give some indication, but only a partial indication, of how serious the situation really is. Total unemployment is now said to be 375,600. Such a figure is hardly in keeping with the statement in the speech from the throne to the effect that unemployment is due to seasonal and local conditions. The percentages in different parts of Canada tell the story. They are highest in British Columbia, where they are shown as 15-8 per cent of the labour forces. Next come the maritimes, with 10-2 per cent of the labour forces unemployed. Quebec, with a percentage of 7-8 per cent, comes next, largely because a great part of that province is affected by the same conditions which affect the maritimes and British Columbia. Ontario and the prairie provinces are still the lowest, with the same figure of 5-3 per cent.
These figures disclose that a considerable proportion of our unemployment is not seasonal or due to local factors, but is the direct result of the loss of seaborne trade. Undoubtedly the British Columbia figures are to some extent accounted for by the abnormal weather conditions of the past two months, and it is partly for this reason that their figures are so much higher in percentage than those of the maritime provinces.
One of the extremely disturbing factors is that unemployment insurance figures seem to be used in determining the number of unemployed. It will be noted also that in the press release of the Department of Labour which gives the total of 375,600 unemployed, that figure is under the heading, "Persons seeking
40	HOUSE OF
The Address-Mr. Drew work through the national employment service, February 2, 1950." There is not an hon. member in this house who is not fully aware of the fact that a large percentage of the unemployed do not seek work through the national employment services. It is well known that throughout the rural areas, and in many occupations, individuals seek employment on particular jobs. These figures are undoubtedly far below the real figures for unemployment at this time.
In considering the unemployment insurance figures as the basic factor in arriving at estimates of the unemployed, it is necessary also to remember that less than half of the employed in Canada are covered by unemployment insurance. Every social service worker, every welfare mission, knows that in addition to those receiving unemployment insurance there are many unemployed whose numbers are difficult to determine and whose plight is a cause for grave concern to this house.
The situation is serious. It is not too much to describe it as critical, because of the rapid acceleration of the unemployment figures in so short a time. It is to be hoped that this house will receive detailed information today from the Prime Minister as to the steps which will be taken to meet a situation of which the government has certainly been aware for many months.
The problem itself is serious and urgent. But what is of special importance to the members of this house is the fact that any indication of the real situation was withheld from hon. members, and is in fact not disclosed in the speech from the throne which we are now asked to approve. The statement of one of the senior members of the government only three weeks ago, that the unemployment situation in Canada is purely seasonal, simply emphasizes the fact that members of parliament have the responsibility not only to deal with unemployment itself but also to consider the action of the government in relation to parliament, and its effect upon our parliamentary system.
The fact is that unemployment is considerably above the figures given by the government, and is steadily rising, for reasons which the government refused to admit to this house during the last session.
The serious threat to our farmers, both in the loss of markets and in the severe drop in prices, is also something that has happened in the two months since the end of the last session. We received 'no indication of any condition such as that which has now become apparent, although the government has been repeatedly warned of the danger and measures were urged to meet, the situation.


Our forest industries, particularly those engaged in overseas export business, are already severely hit. So also are the mining industry and the fishing industry, particularly in the new province of Newfoundland. Where is there any indication of this situation in the speech from the throne and when has the government given us any indication of its knowledge of what was coming?
The fact is that this speech from the throne, which after all is simply a statement put in the mouth of the king's representative by the government, is a statement of propaganda about the excellent things this government has done. In the face of conditions which are disturbing Canadians from coast to coast, there is nothing but a suave assurance of everything being perfectly satisfactory. There is this unemployment, which the figures of the Department of Labour made so clear on Saturday-not so much in their present total, but in their acceleration within the past few weeks. Yet what do we find in the speech from the throne to suggest any action by the government to meet that situation? There is the promise that the provisions for unemployment insurance will be extended. Certainly they will need to be, unless the government recognizes that the people of this country desire unemployment insurance when it is necessary, but want the chance to work, and want the necessary measures taken right away that will provide work.
It will be recalled that a motion was presented to this house calling upon the government to take steps to restore and expand our overseas trade. It was pointed out then that employment and the prices of our products depended upon the maintenance of that trade in a country where three out of every eight workers depended upon export trade for their daily jobs. The government not only failed to meet this situation; it refused to act when the danger was clearly forecast by members of this house.
The loss of export business, particularly to overseas markets, is the cause of the very real difficulties with which we are now confronted. Here again we have a record of suppression of information which is a direct and continuing challenge to the supreme authority of parliament. As long ago as April 25 of last year the Canadian Exporters Association, which is made up of men whose business is the export of goods, in a statement presented to the Minister of Trade and Commerce, expressed the combined judgment of those who know what is taking place. I should like to quote from that presentation of April 25 last, in order to show how clearly those who are in this business were warning

the government then of exactly what was impending. This quotation is from their brief:
We question the wisdoni of frequent announcements which have been made by government spokesmen to the effect that Canada's export trade of 1948 set a new peacetime record in dollar value, without qualifying such statements by emphasizing that such record was only made possible by the expenditure of ECA money and the excessive dependence of Canada on the United States for so large a percentage of Canadian exports in raw commodities and finished goods. As a result of these announcements, the Canadian Exporters Association finds that Canadian producers and the people of Canada are largely unaware of the markets Canada has lost abroad, of the danger that continues to threaten our export trade, and the extent to which Canada's present and future economy is menaced, with the attendant problems of unemployment and consequent lowering of our standard of living, and the exclusion of Canadian products in countries where they are badly needed.
We all know today that every statement made by the government gave a contrary impression to that which was so clearly put forward by those who were actually engaged in the export business. The people of Canada were told that the situation was entirely different from that which the Canadian Exporters Association indicated and which events, unfortunately, proved to be true.
In the same formal presentation we find reference to another example of the kind of statement that has been given to the Canadian public and which has created a false sense of confidence while the government has withheld the vigorous action which should have been taking place to meet a situation of this kind. I quote again from their brief:
The announcement made in January of 1949, that increased trade with the British West Indies had been made possible by arrangement with the United Kingdom government of new dollar allotments to the British West Indies colonies, was greeted with enthusiasm by Canadian exporters. It was, however, a great disappointment when we later learned that the amount of money involved was limited to only three and a half million dollars and that this amount was to be used in trade with the whole dollar area and not for trade with Canada alone. We submit that, contrary to the government's press release of January 4, this was less than what could be considered token shipment and has had very little effect in even partly restoring Canada's export trade.
That quotation refers to a situation that is serious, particularly so in Newfoundland and the maritime provinces, where there has been such a long record of trade with the British West Indies. This statement by the Canadian Exporters Association was completely accurate, and indicated once again how unreliable so many of the statements of the government have been in regard to export trade. When it is realized that at least seventy-five per cent of all our unemployment amongst employables is directly attributable to the
The Address-Mr. Drew loss of export trade, we are better able to judge the seriousness of withholding this information from parliament.
What makes the situation doubly serious is that in addition to industrial unemployment there has been a severe drop in prices of agricultural and other basic products directly related to overseas exports. Now we see unmistakable evidence of resistance growing in the United States to Canadian exports in certain lines to that country. It should also be remembered that industrial exports are being affected as well as commodity exports. On July 22, 1949, the Canadian Exporters Association made the following statement to the Minister of Trade and Commerce; and whatever reasons there may have been for not acting earlier, on July 22 those reasons certainly were not apparent. I quote again:
Our members are concerned about the losses of so many markets for manufactured goods and the present and future effect on industry and particularly employment. We submit that it is in the production of manufactured goods rather than our primary or agricultural products that Canada's greatest labour force is employed, and losses resulting therefrom will affect the Canadian economy more substantially. Our members who have spent so much money and effort in developing exports are now wondering whether Canadian consumers' goods have a legitimate place in world markets. Many are indeed closing up their export departments and are relying more and more on domestic trade, which, while satisfactory now, may not be maintained under changing conditions.
That statement also has proved to be all too correct.
One thing which is apt to give a misleading impression as to the relationship between export business and employment is the fact that the most recent figures of export in dollars relate to production which has already taken place and for which employment has already been given. Particularly in the field of industrial production much that will be exported in the months to come is already made. Present employment is related to anticipated exports; those engaged in the export business are relating their production program to what they may expect to sell some time ahead. As a result, figures of exports in dollars give no indication of the extent to which employment is dropping as a result of shrinking exports and anticipated loss of exports in the months ahead. This is related to the fact that those who know the situation are expecting a still greater reduction in the months ahead. The government is well aware of this fact, and has been well aware of it for many months.
I ask the members of this house to compare the statements and information we have received, with the reality which is now disclosed in unemployment figures, in the prices
42	HOUSE OF COMMONS
The Address-Mr. Drew
of our primary products, and in the statements of those who are actually engaged in the export business. All across Canada businesses built on export are releasing employees because the government is doing nothing effective which offers any reason for confidence in the optimistic statements contained in the speech from the throne.
The way in which the representatives of the people in this house have been treated by the government in this respect is in keeping with its attitude in many other matters of importance to the people of Canada. When we find that essential information has been kept from parliament in regard to employment, production, and export trade, the suppression of the report on the milling combine simply becomes part of a uniform pattern.
If there has been any tendency to regard that subject as a closed book, the Minister of Justice (Mr. Garson) disposed of any such tendency when he travelled across the country during the past few weeks explaining how virtuous the government had been in dealing with that particular report. In his explanations to the public there was no hint of apology for the flagrant and unqualified breach by the government of a law passed by the parliament of Canada. Not only did he seek to justify the law-breaking by the government, but felt called upon to offer the justification for the action of the millers themselves. In Vancouver, on January 27, according to a Canadian Press dispatch he said:
Had the millers been allowed to engage in competition for price reduction, the whole cost would have fallen on the taxpayers in the form of increase in the flour subsidy.
I have no doubt that the millers will welcome the new special pleader for their cause. He went on to say:
Mr. McGregor missed that point in his report.
That is something we were not told in the last session. We were told a great many things. It was just like a case of hiccoughs; something new came up every time that the Minister of Justice spoke, and most of it had just about as much body to it as the speech to which I referred. But this is a new one. The minister said:
Mr. McGregor missed that point in his report.
Thus we find that the Minister of Justice, in his recent trip of self-glorification and selfjustification, indicated quite clearly that he did pass judgment on Mr. McGregor's report. We were under the impression that he had not. His statement in Vancouver would have had no meaning unless it was intended to convey the impression that this had something to do with the government not acting 
upon the report. In fact that was what he was explaining. He said at the same time that had the government prosecuted the millers-and I quote:
There wouldn't have been a case in fifty years when the crown would have looked so cheap.
It becomes necessary to remind the Minister of Justice, and the government which has identified itself with this, including the Minister of Finance (Mr. Abbott), that the real issue is not whether the government should or should not have prosecuted, but that the government suppressed this report until it was impossible for anyone else to prosecute, even if the government did not feel like doing so, and also that the government suppressed the report at a time when it would have been extremely interesting to the people of Canada to know of the special concern of the government about the milling industry.
A new angle to this unpardonable breach of law by the government has emerged since the last session. It will be recalled that the last of several explanations of the Minister of Justice, which kept occurring to him from time to time for his breach of the law, was that he had discovered how difficult it would be in any event to publish the report within fifteen days. As that was the last explanation offered to this house, and as it was the last explanation for his own conduct, we must presume that it was intended to be taken seriously. Nevertheless we find that two subsequent reports under the Combines Investigation Act have been delivered to the Minister of Justice: one on the glass industry, and one on the match industry. The report on the alleged glass combine was submitted to the minister on December 13. It was published fourteen days later, on December 27. The report on the alleged match combine was submitted to the minister on December 27 and published thirteen days later, on January 9. Thus we have positive evidence, produced by the Minister of Justice, that publication can be made within the fifteen days required by law, and it was with good reason that no one had ever suggested that fifteen days were not adequate. When the Minister of Justice says that never in fifty years would a government have looked so cheap as this government would if it had prosecuted the milling industry, he overlooks the fact that no government has ever been made to look so cheap as this government has by the different explanations he has given for breaking the law.
There are a number of aspects of this report about which little has yet been said. Not only was the law broken; not only did the government fail to take any action on the report itself; not only did it follow a course

which prevented others from taking action that ordinarily could be taken; but there has been no explanation about one very remarkable feature of this report, which is no explanation of the solicitous attitude of the government toward those engaged in this industry. On page 79 of this report we find the statement of the commissioner that:
It is clear that the association had in effect a double set of minutes. One of them, official and signed, gives little or no indication that the members reached agreement, or even discussed agreement, regarding domestic prices and related matters. The other, which was apparently regarded as even more confidential than the minutes, discloses the details of many such agreements which were obviously designed to lessen price competition in the sale of flour and other related products.
I have not yet seen any statement by the minister which suggests that Mr. McGregor missed some point in connection with this. If he thinks that Mr. McGregor did, then it would be well to explain why that view is held.
It is only for the courts of this country to say whether anyone was guilty or was not. It should be pointed out, however, that a consideration raised by the finding of the commissioner was the question not only of the breach of the Combines Investigation Act, or the breach of the section of the Criminal Code in regard to combines, contrary to the public interest, but the possibility of a breach of section 413 of the Criminal Code. That section provides that a director, manager, officer, or member of any company or corporate body who omits or concurs in omitting to enter any material particulars in any book of account or other document with intent to defraud is guilty of an indictable offence and liable to seven years' imprisonment. If there was a double set of records, as the commissioner reports, and as is set out in detail in the report, then certainly it is a subject which should have received the most careful consideration.
One of the details disclosed was that there was an agreement in restraint of competition in one set of records and not in the other, if the findings in the report are correct-and that does not relate to the judgment of the commissioner; it relates to the actual words quoted from the records put in evidence. Therefore more was involved in this report than a mere breach of the Combines Investigation Act or that section of the Criminal Code which is ordinarily invoked in such cases.
Only the courts have the right or power to decide guilt or innocence in a case of this kind. But the explanation made by the Minister of Justice on behalf of the milling industry should include some explanation of 55946-i&
The Address-Mr. Drew the reason for keeping a double set of minutes, if those engaged in that industry were satisfied that the government approved what they were doing. Surely there are obvious reasons why lawbreakers must not be lawmakers. The courts might well find the milling industry was innocent of any offence. But, no matter what the courts might find, the government broke a law of this parliament, hid the facts as long as it could from the public, and then offered no apology at any time to parliament for what had been done. On the contrary the minister primarily responsible has recently once again been justifying what the government did. Others prosecuted under the same law, or any other law, have a right to feel a sense of grave injustice when prosecutions are launched by a department of the same government which deliberately placed itself above the law and above parliament.
There is another reason why it is appropriate that this subject should be discussed today. When we met at the beginning of the last session this information was not before the house. Mr. McGregor had not yet reached the point where he found it necessary to resign because of the conduct of the government, and, by his resignation, force this matter out into the open. This, therefore, is the first time members of the house have had an opportunity to pass in a formal way upon the conduct of the government and to say by their votes whether the government is responsible to parliament or is free to decide what laws it will break and what laws it will observe.
This very same attitude, all part of the same pattern, was displayed by the government when an effort was made on a number of occasions during the last session to find out what information the government had in its possession about communist operations, and what steps it was taking. Right up to the last day of the session questions were asked continually about information in the possession of the government regarding the national film board, which it was admitted was no no longer making secret films, because of screening for communist activities.
It was even suggested it was unfortunate that this subject had come up for discussion in the house-unfortunate that hon. members representing the people of Canada should have an opportunity to discuss a situation regarded as so serious that even the ordinary films made for educational purposes in the armed forces were no longer being made by the national film board, but were being entrusted to private film producers as being a safer method than through the government body itself. The impression left was that

The Address-Mr. Drew there was nothing unusual in the situation; and that was the attitude of the government right up to the very last day.
It will be recalled how question after question was directed first to the Minister of National Defence (Mr. Claxton), when he admitted that the films of his department were no longer being made by this board, and later to other ministers. In an effort to find out what information the government had in regard to activities which caused sufficient concern to cause to be withheld from that board such relatively simple productions as those described, these questions were asked.
The attitude of the government was that this was simply an ordinary screening. Then we learned through the press a short time afterwards that a new film commissioner had been appointed to the national film board, and that he had been asked to take that position some three weeks before. Thus we learned ffiat, while the House of Commons was still sitting, and while we were trying to get information as to what the government knew about this department, and were left with the impression that there was nothing positive they could tell us, they had information sufficiently positive to make them decide to change the commissioner of the national film board and to have a housecleaning in that government agency.
Just to emphasize the fact that the government has a great deal more information in its possession than it has given to the house, in spite of the repeated questions, the Minister of Justice only last week stated that communist spies are operating in this country and that the government is taking action to deal with the situation. It is strange how necessary it seems to be for the elected representatives of the people to depend upon our very excellent press for information they seek in the house, and to which they are entitled, in full detail, in the house.
In view of the gravity of the international situation, and the lessons taught by the admissions of Dr. Fuchs, this house should insist that immediate steps be taken to prosecute any spies known to the government. If the government knows that there are spies, then there should be prosecutions. If the government does not know who the spies are, then the Minister of Justice was just talking through his hat; it is one or the other. Action in regard to this menace is long overdue- action to restrain the subversive activities of the communist party in this country, in accordance with the recommendations received by the government long ago.
This statement of the Minister of Justice serves to emphasize the failure of the government to act upon the recommendations in the
[Mr. Drew.l

report of the royal commission on espionage. Do not let the government place any cloak of virtue about itself for those prosecutions. It is necessary only to go back to the record to find how difficult it was to get the government to act on that occasion, and to realize that it was only under pressure it acted, even then. But the government did not carry out the details of that report. It did act upon the positive findings that there were grounds for prosecution against certain individuals implicated in a spy ring directly related to the Russian embassy here in Ottawa. But the commission also found that there were other spy rings-and this House of Commons has a right to know what has been done in regard to those other spy rings. It has also the right to demand that the government act upon the recommendations made in that report to deal with possible communist activities within government agencies themselves.
There was one recommendation to the effect that there be careful consolidation of all supervision of that kind. Yet, if the house was correctly informed during the last session, there has been very little in the way of an effective method of dealing with this important subject. The report certainly made it imperative that these activities be dealt with in a way that would be in keeping with the seriousness of the disclosures made in the report. What may have appeared urgent then becomes doubly urgent now, in the light of recent events. If there are secrets in this country which are of sufficient importance that certain government agencies are denied the right to deal with them because of suspected communist activities, then there are added reasons in these last few days and weeks why the most vigorous and effective steps should be taken to deal with subversive communist activities in every part of Canada, and of every kind. The whole tendency has been to minimize the importance of this subject. Certainly we are awaiting information as to what action has been taken in keeping with the seriousness of the disclosure.
In the meantime communist activities are going on apace and wide open. Although communist publications are being permitted to circulate the most outrageous statements about Canadian public men, there is no apparent attempt to act under existing laws which are being broken, to say nothing of the necessity of more effective provisions in the Criminal Code, to deal with subversive activities of this kind. It will be recalled that there have been repeated requests for an amendment to the Criminal Code which will make it possible to bring before our courts those who are engaged in an organized effort to destroy our free democracy. Having regard to the seriousness of the statement made by

the Minister of Justice last week in regard to known spying in this country, the silence of the speech from the throne as to any action to be taken to suppress communist activity can only indicate a continuing failure to appreciate the real nature of the menace which we face.
Another significant omission from the speech from the throne, which must cause great concern to a large number of Canadians, is any positive assurance that the government intends to take effective action concerning old age pensions. For several years we have urged the introduction of a national contributory old age pension plan with adequate pensions payable as a right, without a means test, which the late Tommy Church so properly described on a number of occasions as the "meanest test". Those who now constitute the present government were lavish in their promises only a short time ago. Now we find no assurance in their official statement of the business of this session as to what they intend to do on this subject. We find on the order paper notice of a motion to set up a committee of inquiry. There are occasions when committees are essential. There are occasions when committees are the only way in which essential information which should be before this house can be properly brought forward, as in the case of national defence, external affairs, and subjects of the kind, where experts cannot satisfactorily appear on the floor of the house to answer the questions which must be asked if adequate information is to be available.
Surely this is a subject on which the government has all the information necessary. Certainly we have been assured that it has been giving the matter full and adequate consideration for a very long time. The government certainly has the staff available for that purpose. It has had this subject continuously under consideration for many years. It was considered by both dominion and provincial governments in 1945 and 1946, and statements were made which were presumably based upon an examination of the subject. If the government still lacked information on this matter when we met last fall and an inquiry by such a committee was necessary, then- that committee should have been set up at the beginning of the last session and not at this time. Certainly it was not because the matter was not brought to the attention of the government during the last session. Members on both sides of the house are well aware that this is a subject on which the government has given assurances. They are well aware that all the plans of the various governments dealing with the question are already available to the government. In the end the government must assume the responsibility
The Address-Mr. Drew for the decision it will make, and the time is ripe for the government to make a decision in keeping with the assurances "upon which it received the support of the people.


Mr. Rowe:: They want to use them over again.


An hon. Member:: They did not do badly last time.


George Alexander Drew: A very significant remark was just made: "They did not do badly last time." It would be well if members of the house carefully examined what was said on that occasion in regard to a number of vitally important subjects.
Members, on both sides of the house are well aware that there is widespread dissatisfaction with the way in which the government has dealt with the subjects I have mentioned this afternoon, and that was very clearly indicated by the mover of the motion. The most urgent subject for consideration is the rising tide of unemployment caused by the loss of our export markets, with a sudden resulting drop in prices for agricultural and other primary products, as well as decreasing demand. These and the other questions before us can only be dealt with effectively if the house reasserts its authority over the government and declares in no uncertain terms that parliament is supreme over its executive committee. We have a right to know, and to know immediately, with what measures the government proposes to meet this situation. We have been told on many occasions, publicly as well as in this house, that plans for public works of various kinds are being held back only until a demand for employment presents itself. That time is now. What are the plans, and when will they be put into operation? The speech from the throne gave us no information of any kind on that subject.
We will support every effective measure which will give employment to those who are looking for work in every part of Canada today. There are new resources to be developed, which will in turn create great new opportunities for employment. There are different types of public works which can be carried out. Do not let anyone make the suggestion that emphasis upon the need for steps that will deal with employment is an attempt to undermine confidence in this country. The thing that will undermine confidence in this country is the people being unable to see immediate and positive action on the part of this House of Commons and the government which is its executive.
In examining the new resources and the new things to be done, we may as well examine
46	HOUSE OF
The Address-Mr. Drew first of all the immense possibilities of the development of power across Canada; because there is no single public undertaking which in turn creates so much employment as the development of electric energy. It is true that in most provinces the development of electric energy is under provincial commissions, but there can be no doubt whatever that this government, with the support of this House of Commons and of parliament, will find the provinces and the municipalities ready and willing to develop those resources which in turn will provide productive bases for new employment in the years ahead.
There are great irrigation undertakings long overdue in many parts of Canada. Such undertakings would also create great new productive capacity in every part of this country. In the prairies there are areas where some of the richest farm land in the world is just a short distance away from soil which affords a bare living. The difference is only the want of irrigation. There are great possibilities in the use of the Saskatchewan and other rivers in the west, just as there are possibilities in the use of rivers right across this country for the enrichment of the soil, the expansion of our great productive capacity, and, what is so important to all, an increase in employment which will provide a livelihood and bring happiness to many people in this country. There are great land reclamation projects to be carried out. There are great conservation programs which will increase our productive resources and afford employment in the years ahead.
All these things I have mentioned are self-liquidating public developments in which every dollar spent would be a sound investment in the future of Canada, and a safe investment, under the most stringent definition of safety. In fact it has been demonstrated already that public developments of this kind can be financed by private investment if the government should feel that any of them should not be carried forward through the investment of public funds. That has been done in province after province-and it is interesting to note that the securities issued to finance public developments of this kind sell as readily as dominion government bonds, and yield as high a return to the investor. From Newfoundland to British Columbia there are things to be done for the advancement of our country which will create employment now, and many times that employment in the years that lie ahead for a nation far larger than Canada is today.
There is one thing we must keep in mind, however. No new road, no new power plant, no new irrigation project, no newly-productive area in itself will give employment in the


years ahead unless we can find markets for that greater production. Let no one say that we are painting a gloomy picture because we examine realities. Let anyone who is concerned as to that go into the missions and other places across this country where people are fed, and see the men and women there looking for food; then ask whether this subject should be discussed in this house. Our task is to find ways in which to give those people new hope, and immediate hope, for the months and years ahead. In all humanity there can be no excuse for a continuation of the situation with which we are now confronted. A hungry world wants the food we produce; and while I have indicated disagreement, which I think is soundly based, with what was contained in certain statements by the Minister of Agriculture, I do believe the minister said something in London just over a year ago that badly needed to be said-that there was something wrong when here in Canada vast quantities of food were available, while artificial barriers prevented that food from reaching the hungry people who needed it.
Other nations need our industrial and other products. The barriers to trade must be broken, and as a nation we must get out and sell. The position has been that the world demand for the things we produce in such abundance has limited) the necessity for ordinary selling. This is a real world, and in this world the daily bread of people must be earned by work. The things we produce will be sold only by ordinary, sensible selling methods. There is a world that needs our food. There is a world that needs the industrial products that the skilled workers of this country can turn out in such quantities, and it is for us to find a way by which they can reach the markets of the world. The job of the government is to take every possible step to break down trade barriers so that we can get out and sell. The job of the government also is to break the log jam that exists now because of the inconvertibility of exchange. I do hope we will not hear a repetition of those assurances that nothing can be done, such as we heard a year ago. Many hon. members will recall that we urged1 the government to face reality and assist the export trade by getting the Canadian dollar to somewhere near its real exchange value in relation to United States funds. We were told that was nonsense; yet it was not long afterward that the nonsense became a reality.
Let no one tell the members of this house that no steps can be taken to make exchange convertible. It was always convertible, prior to the last few years. It was convertible before Canada even became a nation with its own currency. This is not a time for Canada to sit back and wait for the lead of others.

We are the greatest exporting nation per capita in the world. We can become an exporting nation far beyond anything we dream of if we will develop our resources and use the productive capacity that God has given us. To no other nation in the world today is such an opportunity offered; no other nation is faced with such a challenge to give leadership. Surely what has been done in the past can be done now and in the future. Surely some way is open to sensible human minds by which our food products and our excellent industrial production can get to the markets of the world which want what we have to sell and which, by that very demand, will afford employment and bring about expansion in every part of Canada.
So much for the practical problems presented by this situation with which we are confronted. Quite apart from those practical problems, however, the conduct of the government has raised an issue which will determine whether we are in fact a true democracy here in Canada. Government of the people, by the people and for the people was not first used as a definition of democracy by Abraham Lincoln. It was used at least twenty-three hundred years ago to describe the democracy that had emerged in ancient Greece. Even in those earliest democratic city states, however, democracy did not mean government of the people by all the people meeting to discuss-their affairs. Democracy meant government of the people in their own best interests by the freely-chosen representatives of the people. Democracy has always been government of the people by the elected representatives of all the people. All the people of Canada are represented by the members of this house. The 14 million people of this country find their collective voice amongst the members who sit on both sides of the house. This is the structure of democracy. The mere existence of this chamber, however; the mere fact that members representative of all the people sit here; the mere existence of this magnificent parliament building in Ottawa; the beauty of the decorations and all the dignity that may accompany the tradition associated with this parliament, do not in themselves offer any guarantee that in reality there is government for the people by their own representatives.
The most beautiful house of parliament in the world is that in Budapest. Representatives from every part of Hungary meet in that lovely building by the Danube. But there is no democracy, and there is no freedom.
Neither is any freedom found because of the fact that men and women from all over Russia gather within the stern and majestic walls of the Kremlin. Those who have seen
The Address-Mr. Drew the semi-oriental beauty of that building know that if dignity and impressiveness were any assurance of the real machinery of democracy, it would be found in the Kremlin itself. That is not the test. The test of democracy is, first of all, whether the people know the essential facts when they choose their representatives; and then, in turn, whether their representatives who meet in parliament are fully informed as to every important fact upon which decisions are made by their executive committee, the government.
Today I am discussing the information available to the present members of this house. Our last session ended only two months ago. Were we fully informed in regard to all the information in the government's possession about trade and the threat of unemployment, lower returns to our producers, and decreasing production? Were we informed, as we should have been, about the way in which the government dealt with combines, which can restrain the trade of this country and reduce the price advantage that comes from free competition? Were we fully informed as to what the government was going to do about communist activities in this country, which have assumed such importance? Were we fully informed as to what the government knew about communist activities within the national film board, to say nothing about several other boards which are of equal interest to the members of this house, and will be throughout the session? These are questions which are of quite as much importance to those who belong to the party from which the government is formed as they are to the members of the opposition.
I hope that no one will say that the majority of government supporters is so great that it is a waste of time to raise these questions here today. The size of that majority, in itself, imposes upon those who belong to the government party the highest obligation to observe those principles of responsible government which rest upon the supremacy of parliament. In fact it is to those who belong to the parties from which the government is formed that we must look for action in keeping with their own belief as to the responsibility of parliament, if this situation is to be dealt with as it should be.
It would be like a breath of cool air on an extremely warm day-not a day like today, but on such a day as doubtless we shall have before this session comes to an end-if some hon. gentlemen who are not members of. the opposition were to say here some of the things they have already said outside this house.


Mr.   Coie@Maiapedia-Malane: Name them.

The Address-Mr. Drew


George Alexander Drew: If any government feels safe in the conviction that whatever it does it will receive the support of its party followers, then our parliamentary system stands in very real jeopardy.
The issue placed before the house by the conduct of this government is an issue which is being drawn clearly throughout the world today. If any hon. members are unaware of a place in which they can find an excellent discussion of this very point, I would commend to them the speech of one of the candidates for the Liberal leadership a year ago last summer. The issue placed before this house was stated then, and it is one which has been emerging more clearly all the time. It has been simply stated, perhaps too simply to be sufficiently impressed on many minds, by one of the greatest modern students of democracy, Sir Norman Angell, in these words:
The Russian view is that the power of a government should be used to repress heretical objections to the true doctrine: to forbid political oppositions, even in its satellite states.
The western view is rather that the function of power in a free society is the precise opposite: To ensure the right of political opposition, the right of access to the facts upon which governments base their policy, the right to discuss those facts and to oppose the conclusions drawn by the government.
In that simple statement the emphasis is placed, as it is throughout the excellent book from which the quotation comes, upon the importance of access to all the. essential facts by the representatives of the people, as well as the importance of all essential facts being voluntarily furnished. It is obvious that those who are not within the secret confidence of the government cannot be in a position to know all the facts that come to the government from its many agencies.
To some people, this quotation from Sir Norman Angell's description of the problem of modern democracy may seem an oversimplification. To some it may not seem that the issue can be so simplified. There are many stopping places between those two points. But these are the two distinct and opposite points of view. On one side is government, which, having attained power, seeks to limit the opportunity of free discussion, either by preventing criticism or by suppression of the facts. The other is government which insists upon the right of the people's representatives to all the facts, and the right of those representatives to discuss those facts with complete freedom, so that decisions may be made with the full advantage of all the advice that can be gained from the representatives of all the people with the special knowledge of the particular parts of the country from which they come.

While there are many intermediate points between the two, those who steer their course away from the widest interpretation of the meaning of democracy are challenging democracy itself, no matter what they declare to be their purpose or what they say their belief really is. What it is so essential for us to remember is that the vote at the ballot box is not the proof of democracy, and that the presence of members here in this house is not the proof of democracy. There are ballot boxes in Russia, in Hungary, in Germany, in Czechoslovakia, and in all the countries today under the domination of the crudest form of dictatorship the world has yet known. There undoubtedly will be ballot boxes throughout the whole of China, and a vote will be taken which will probably be close to a one hundred per cent vote, when communists will be returned with great acclaim in every polling subdivision, No, the ballot is not the proof. It is what the voters know about the issues, and it is what the voters know about the things that are before the people for consideration. Then, having made their choice-


An hon. Member:: They did.


George Alexander Drew: Yes, they did; and this government will in due course be answerable for what the people did not know. You have the members sitting here in this house, and those who sit here are displaying limited knowledge of the machinery of democracy if they laugh at the suggestion that it is important that the members know what the facts are. Unless and until the members of this house, of all parties, assert their supremacy over the executive by their vote in this house; until they tell this government that it has no right to decide which laws it will observe and which it will not; until they tell this government that the laws passed by this parliament are the laws of the land to be observed, first of all and not last of all, by the government; until the members of this house, and particularly the members who belong to the party from which the government is drawn, assert their voice-until then, our own parliamentary system will continue under an ever-darkening cloud.
With a return to responsible government, and with the supremacy of parliament restored, we can look with confidence to the future. Wider opportunities are available to this country than were ever open to our vision in the past. The great oil developments of the west and the iron developments of the east are merely an indication of the vast expansion which lies before us. But we shall only be able to do the job we were chosen to do as representatives of the people of Canada if we insist upon receiving, and

receive, full and accurate knowledge of every essential fact that the government is able to obtain through its large and highly-trained civil service.
It is because of my confidence in what can be done to meet the tests that lie ahead if we really assert the full supremacy of parliament, and because of my confidence in what can be done by a free parliamentary system, that I present to this house the following amendment. I move, seconded by the hon. member for Peel (Mr. Graydon):
That the following words be added to the said address:
"We respectfully submit to Your Excellency that Your Excellency's advisers have:
(1)	failed to take adequate measures to preserve and expand markets for Canada's surplus products of farm, forest, sea and mine, and to deal with the problems of increasing unemployment and reduced income to Canadian farmers and other producers; and
(2)	failed to take steps to inaugurate a national contributory system of old age pensions without a means test; and
(3)	deliberately violated a law of this parliament by illegally suppressing the report of the commissioner under the Combines Investigation Act on the flour milling industry for ten months, including the period of the recent general election campaign, and denied to parliament information essential to the performance of its duty and the maintenance of responsible government; and
(4) failed to take adequate measures to curb espionage and other harmful activities of communists in Canada.
For these and other reasons we respectfully submit that Your Excellency's advisers are not entitled to the confidence of this house."


Louis Stephen St-Laurent: It is indeed a pleasure, Mr. Speaker, for me to join with the leader of the opposition (Mr. Drew) in extending the usual congratulations to the hon. members who moved and seconded the address in reply to the speech from the throne. The hon. member for Kindersley (Mr. Larson) and the hon. member for Villeneuve (Mr. Dumas) are among the younger and newer members of this house, having come into parliament for the first time at the last general election. For this reason, if for no other, we as their colleagues are proud of the way in which they addressed the house. I think Kindersley and Villeneuve may also be proud of the manner in which they are represented here. The speeches made by the mover and the seconder reflect credit upon themselves, upon those who sent them here, and upon this parliament itself. The hon. member for Kindersley made a speech which, I am sure, we all felt deserved our congratulations and which was highly gratifying to us in its demonstration of the forensic ability he has brought to this parliament. He is one of the youngest members of the house, and has farmed in Saskatchewan since his college days, with the exception of
The Address-Mr. St. Laurent four years when he was a member of the Royal Canadian Air Force, where he served with great distinction. He was decorated for that service. I think it is safe to say that the hon. member has a promising career before him.
The hon. member for Villeneuve (Mr. Dumas) spoke in both French and English. Those of us who were able to follow him in both languages heard, I think it is fair to say, an address of high merit. It was something that we expected from the hon. member, and we were not disappointed. The last election was not the first time that the hon. member had been elected to public office. He had established for himself a reputation in municipal affairs as manager, alderman and then mayor of the town of Malartic. The hon. member is a qualified land surveyor and forestry engineer, and I am sure that his professional knowledge and experience will be of value to us in the consideration of many of the problems with which we shall have to deal. The electors of Villeneuve can feel that they have made a happy choice in the selection of their representative in this parliament.
Of both I think it is fair to say that no finer introduction could have been made to the consideration and discussion of the questions with which we shall have to deal during this session than the utterances of these hon. members who respectively moved and seconded the address in reply to the speech from the throne. I repeat, I am very happy to extend to them sincere congratulations.
I think I should also extend congratulations to the leader of the opposition (Mr. Drew), not of course upon the assertions contained in his motion of amendment to the address in reply to the speech from the throne, nor upon the sentiments in the last paragraph of his amendment, but upon the ingenuity of some of the arguments submitted to us here today, upon the expression of his confidence, which I share, in the great future of this country, and in the abundance and varied nature of the resources with which it is blessed. Perhaps I might also offer congratulations to the leader of the opposition on, shall I say, the realism of his followers- perhaps the hon. member for Rosetown-Biggar (Mr. Coldwell) and the hon. member for Peace River (Mr. Low) might call it the optimism of his followers-in providing him with a permanent residence here in Ottawa as leader of his party. The hon. gentleman-


George Alexander Drew: Mr. Speaker, I should explain that I understand it will be available for the present Prime Minister.

The Address-Mr. St. Laurent


Mr. Si. Laurent:: I had understood that it was being vested in a trust made up of representatives of the party of which my hon. friend is the leader, and I would not expect anything else from that party but the establishment of a permanent residence for their leader.
The leader of the opposition seems to be somewhat concerned about the future of democratic institutions in our country. Well, he from time to time imparts some wisdom to his fellow citizens, and I was gratified to note that he was reported as having said this in London on February 8. I quote from the Globe and Mail of February 9:
Our democratic system rests on the faith the people have in those offering themselves for public office.
Well, that is probably a lesson he learned from the last election. It was demonstrated in something like 73 per cent of the constituencies of this country that they did believe in a true democratic system, and that they did place their faith and confidence in the members of this party to discharge for them those functions of their citizenship which it is not convenient for them to deal with themselves in town meetings.
In his following words I think the hon. gentleman explained why there was that confidence and trust in those who were offering themselves for public office. He continued:
The basic word in that system is truth. In the end it will be the people who will decide, and they will turn invariably to the party which they have come to trust and rely on.
And that is what they did; and that is no doubt what impressed itself upon the hon. gentleman and moved him to make that declaration.


William Earl Rowe: They did not have the McGregor report then.


Louis Stephen St-Laurent: I am afraid that what I was going to say about the leader of the opposition might apply to his right-hand neighbour. I was going to add that the whole of the lesson that might be drawn from the result of the last election had not been absorbed by the hon. gentleman, because only four - days later, in my own home city of Quebec, the hon. gentleman is reported in the Gazette of February 13 as having said this:
In spite of its clear and unqualified promise that there would be no change in the constitution without consulting the provincial governments, steps were taken during the last session, without consulting any provincial government, which provided for very substantial amendments to our constitution which could have far-reaching effects upon the rights of the provinces.
Well, now, of course the people of my home city knew that that was just not true. They
	j
knew that no promises had been made that there would be no change in the constitution until after consultation with the provinces. They knew that what the hon. gentleman was referring to was a statement that I had made in a broadcast that after the election it was our intention to hold a conference with the provinces to try to devise a system under which we would be able to make in Canada all future amendments to the constitution; but that was not a statement that, until that arrangement had been arrived at, there would be no other amendments to the constitution on matters that did not concern the provinces. I am happy to say that the promise which had been made was carried out. As indicated in the speech from the throne, we did have this conference with the provincial representatives; and as was pointed out by the mover of the address the other day, there was unanimous agreement by all the governments represented1 at that conference that there were certain parts of the constitution that could be amended without reference to provincial governments or provincial representatives.
So that there may be opportunity to refer to it if hon. gentlemen care to do so, I would quote from page 99 of the published reports of the proceedings of the conference, where it is shown that the Minister of Justice (Mr. Garson), as chairman of the committee, brought in a report of a committee which had been set up to determine just how far we had progressed in the three days' discussion:
Mr. Prime Minister and delegates: I am happy to read this report of the committee of the attorneys general of the constitutional conference of federal and provincial governments. In so doing, I announce with extreme pleasure that it was a unanimous report.
Your committee recommends the following resolutions :
1.	That the provisions of the British North America Acts 1867-1949 and other constitutional acts be grouped under six heads, namely:
(1)	Provisions which concern parliament only.
(2)	Provisions which concern the provincial legislatures only.
Then there are further paragraphs which I need not read, followed by this:
2.	That in respect of group (1) amendment shall be made by an act of the parliament of Canada.
3.	That in respect of group (2) amendment shall be made by an act of the provincial legislature.
That unanimous report of the attorneys general of Canada and the provinces was unanimously agreed to by the conference. A permanent committee was set up to recommend into which of these categories these various provisions might be placed. So that, if one wishes to receive support as a consequence of the assertion that the basis of confidence is truth, and that in turn the public will turn invariably to the party they have

come to trust and upon which they can rely, it is unwise, I suggest, to build up a straw man for the purpose of knocking it down, and build it up upon distortions of what the public knows to be the real facts.
Then, there is one other matter to which the hon. member has referred today. He has pointed out that when, about a year ago, devaluation of the Canadian dollar was suggested it was treated by us as nonsense, but that nevertheless shortly after the election of last summer the dollar was devalued. Well, I suggest it would be wise to see what changes occurred in the meantime.
A year ago it was proposed that there be devaluation of the Canadian dollar, and this at a time when the Chancellor of the Exchequer in the United Kingdom was declaring that sterling was not going to be devalued. The suggested Canadian devaluation would have been for the purpose of increasing the possibility of exports to the United Kingdom. We said it appeared to be nonsensical, because it would have made it all the more difficult for the United Kingdom to pay for Canadian exports by selling their goods to us; because if we had devalued at that time an import from the United Kingdom costing 90 cents would thereafter have cost one dollar. But when the United Kingdom devalued their sterling and made their price, instead of a dollar, 70 cents in Canadian currency, we found that that was going a little bit too far.
We had contended that their prices were too high to enable them to earn Canadian dollars in our market and be able to use those Canadian dollars to pay for our exports. But we felt that a 30 per cent devaluation in terms of Canadian dollars was rather more than the circumstances justified and, instead of leaving it at 70 per cent, we devalued our dollar by 10 per cent, thus making it 80. That was a very different situation from the one which existed at the time hon. members were suggesting that the Canadian dollar should be quoted at its real value. Whatever they meant by "real value" at that time, it was of course impossible for anyone to determine.
The leader of the opposition (Mr. Drew) talked today about the reasonableness of making currency convertible. The difficulty is not with respect to the converting of currency, but is rather with respect to the exchange of goods. Trade is not the passing of pieces of paper from one person to another. Trade resolves itself into the exchange of commodities; and the difficulties about the non-convertibility of exchange arise from the fact that there have not been commodities which could be delivered to us in exchange for our commodities exported to the United Kingdom.
The Address-Mr. St. Laurent
The hon. gentleman has dealt at considerable length, and I propose to do likewise, with the unemployment which has developed to a significant degree in the last few weeks. This is a development which everyone regrets, both because of the hardship it imposes upon the families and individuals involved, and because of the loss of productive effort to the nation which is involved in any increase in unemployment.
But before we rush in with any rash generalizations, or are too much impressed by memories of the hungry thirties, I think it would be well for us to look at the real facts of the situation. The first real fact is that we have now, including Newfoundland, the largest labour force in our history. This labour force totals more than five million men and women. Our labour force is not only the largest we have ever had, but it is the best trained, the most skilled, the most diversified, and most productive.
Our greater productivity is attributable not only to the experience the labour force itself has gained through its varied skills, but through the experience management also has gained. I think it is fair to say that our labour-management team, that combination of labour and management today, is equipped with new and modern plant, machinery and power facilities resulting from the wartime and the post-war capital investment program which have been very large indeed.
I suggest we may speak with some pride of our labour-management team in Canada. With only a few regrettable exceptions, over the last few months labour and management have been able to get along together; and whenever any differences have arisen they have been able to sit down at a table in a practical and common-sense way. We have avoided the bitter, industrial strife which inevitably tends to develop class hatreds and leads to political as well as economic anarchy. When we consider the situation in some other parts of the world I think we can be sensible of the good judgment and reasonableness most of our management and labour leaders have shown in the post-war years.
The composition of our labour force is varied, and this fact must be kept in mind when one is considering the measures required to meet an unemployment situation when it develops. It is true that there has been a great increase in the mobility and adaptability of Canadian labour in general; but there are practical limits within which that adaptability and mobility can be exercised. For example there is no point in providing a girl who has been laid off from a small textile plant with a job which would arise from the construction of a sewer project nearby.
52	HOUSE OF COMMONS
The Address-Mr. St. Laurent
In round figures about one million of our five million labour force are farmers and other agricultural workers. Another half million are normally employed in other primary industries such as mining, forestry and construction. Manufacturing, in terms of employment, does not bulk as large as some might think, and accounts in fact for only a little over a million operatives. The balance is made up by the wide range of service or professional occupations, transportation, merchandising, distribution, and civil service at all levels of government. This break-down is of some importance. Unemployed people are not just statistics. They are persons with special individual skills and adaptabilities. This is a part of the background we must appreciate when we speak of unemployment in general terms.
This consideration of the size, skills and composition of our labour force is one of primary importance in thinking of remedies for any unemployment that develops. Another obvious factor is the extraordinary times in which we live, and the exceptional conditions we have experienced. It is still difficult to grasp in their proper perspective the magnitude of the changes of the last decade. In 1939 Canada was a civilian economy organized on a normal peacetime basis. About one-quarter of one per cent of our labour force was in the armed forces. Our armament capacity and production were practically nil. Five years later two million of our people, four out of every ten of our labour force were either in the armed forces or directly engaged in war industries. Our whole economy had been transformed from a peacetime to a wartime basis. It may sound rhetorical, but it is true that Canada had become one of the most important arsenals of embattled democracy. In the next couple of years that economy was to experience another violent reorientation. The war establishment was dismantled and the two million people directly involved had to be re-established in civilian life.
No argument or apology is necessary for the fact that the government of the day viewed with considerable misgivings and concern the possible disruption of the economy as a whole, and the individual lives of so many of our citizens. Precautionary steps were taken on an extensive scale. The government made generous and comprehensive provision for our veterans, and incidentally have provided thereby through provisions made for veterans, through unemployment insurance, family allowances, and the increase in old age pensions, for a wide distribution of purchasing power in Canada.

At the same time our assistance in providing relief and rebuilding the western European economy, which is admittedly of such vital importance to us, far exceeded on a proportionate basis even the generous efforts of our great southern neighbour. War plants were reconverted. The labour force found new employment in satisfying the war-deferred demands of our civilian economy. The shift was made from a war to a peace basis with an expanding level of production, employment, income and general well-being, and with an almost unbelievable minimum of friction and discomfort. We have no regrets that some of the emergency measures which were prepared to meet possible distress were found unnecessary.
Nevertheless, as I said, the recent growth in unemployment is now a matter of serious concern. It would not have been surprising if this had occurred before or even if it had been more extensive. When we consider the terrible destruction of the war in Europe and Asia, the fearsome partition which has since developed between the two great armed camps, the disruption of normal trade and exchange and the break-down of the complex pre-war international economic and political system in many parts of the world, I think it is really extraordinary that Canada has been able to maintain such an exceptionally favourable position for so long.
I do not suggest for a moment that we are immune or that we can make ourselves immune to the violent dislocations which have occurred and are continuing to occur in so much of the world. A country as dependent as Canada on a free flow and high volume of international trade, which has always been and will always continue to be a necessary consequence of the nature of our resources, is inevitably vulnerable to external developments over which we have no direct control. Some part of our unemployment, and no doubt much of the concern which farmers, fishermen and other primary producers now feel, arise directly from marketing difficulties abroad. These difficulties of course are basically difficulties of our traditional overseas customers, but they are in time passed on to us.
Another unfortunate development has been the most unusual seasonal weather this winter. We may well echo the standard complaint that everybody talks about the weather and no one does anything about it. The fact remains that the weather, in a country such as Canada, plays a very important part in our whole economic life. Too much snow stops railway trains. We know that happened in the west. Too little snow puts ski lodges in a very precarious position, and we know that

happened north of Montreal. A bare winter kills pastures, and too much snow in the bush impedes forest operations. Every one of us is affected in some way by the vagaries of the weather. This year, in the last few weeks, the combined result of these various factors- marketing difficulties arising from the dollar shortage of our chief customers, the impact of sterling devaluation on a few of our industries, adverse weather conditions-is felt now more sharply because we are just approaching the normal seasonal peak of unemployment for the year.
I have said that the impact of the devaluation of sterling has meant some distress to a few of our industries. That was foreseen, and it is something which I think we just must not attempt to prevent. For the good of the nation in general we want an increase in the exports of Great Britain to ourselves, our imports from the United Kingdom, so that the price of these imports can be converted into dollars usable to pay for the surpluses we must continue to export to the United Kingdom. Such distress is something unfortunate that has to be considered. We have to attempt to deal with it, but we must not attempt to deal with it in a way that would shut out such imports from our country because they are harmful to some of our local industries. It is the only way in which we will secure the restoration of world trade, and of the trade that is essential to the prosperity of this country.
The seasonal ups and downs of employment are basically of course simply the effects of nature and climate. Nature and climate determine when crops can be sown and harvested; nature and climate determine when is the best time to perform outdoor work. In Canada we normally expect our peak of seasonal unemployment in February or March. There is some variation according to the different regions of the country. We get our peak of employment in August or September. The seasonal rise in unemployment this year has been accentuated to a substantial degree by a reduction in woods operations which normally absorb a large number of farmers and construction workers who otherwise would be idle during the winter. This reduction in woods operations is due in part to the loss of overseas markets, especially for pit props from northeastern New Brunswick, but it is due in much larger part to other conditions. The three previous operating seasons had been seasons of favourable weather conditions, and the pulp and paper companies rebuilt their stocks to rather more than normal size. About eight or nine months ago, as hon. members know, there was an indication of some slackening of economic activity in the United States. Our pulp and paper people felt that
The Address-Mr. St. Laurent it would be a prudent thing to reduce the size of their inventories in which so much of their working capital was tied up at rather high costs of production.
I am informed the result was that this year there were about 35,000 fewer jobs in the woods than in previous years. That does not mean unemployment merely for 35,000 men. With that number of men not working in the bush there is the indirect effect on the producers of mackinaws in the Ottawa valley, the producers of blankets, and those who furnish supplies of all kinds; and in certain localities this has had a pretty serious effect on the number of people out of work. I am informed that the usual cut of wood for pulp and paper is of the order of seven and one-half million "cunits", a cunit being one hundred cubic feet, but that for this season it will not exceed five million eight hundred thousand cunits, a reduction of some twenty per cent. It has been expressed to me in another way. The pulp and paper companies have been carrying supplies to last them on an average of about thirteen and a half months. Those supplies now are down to something of the order of ten and a half months.
The fears that were entertained in regard to a falling off in the United States demand were not realized. As a matter of fact the January consumption of newsprint was higher this year than in any previous January in history. There was a period last summer, as we all know, when the demand for wood pulp was quite low, and several operators were either working a short week or closing completely. I am told that at the present time, however, the demand for wood pulp has picked up, and that there are orders for the normal production of our plants.
That, I think, is an illustration of a point I might make here. Let us not harm ourselves with fear. The present unemployment situation would have been very much easier if those 35,000 jobs in the bush had been available this winter. As it turns out now, conditions were such that the companies would have been perfectly justified in providing those jobs. Their woodpiles will have to be rebuilt. For the future, therefore, there is not a definite loss; they will have to rebuild those woodpiles, but the unevenness in the process of doing so has increased the difficulty.
Then there are the weather difficulties. The other day I was handed a report from a Vancouver newspaper which said some 3,400 men were going back to work in the mills in that locality the following Monday morning because weather conditions had improved, and because it had become possible to get trains moving over the tracks that had been cluttered up with snow. That is a seasonal situation.
54	HOUSE OF
The Address-Mr. St. Laurent
I am not trying to minimize the difficulties we are facing, but I am trying to place them in their proper setting, to indicate that much of this problem is seasonal and that already there has been recovery of a certain portion of the extent by which the seasonal unemployment this year exceeded seasonal unemployment in normal years.
Because of these conditions it is true that some 370,000 persons were listed with the national employment service as looking for work; and the leader of the opposition (Mr. Drew) is also correct in saying that these are not accurate statistics of persons out of work. A large number of those listed with the employment service already have jobs but want better ones. On the other hand it is true that quite a large number of those out of work and wanting jobs are not listed with the employment service. But those employment service figures are kept from day to day, and they do show a trend.
The dominion bureau of statistics makes a quarterly sampling all over the country and gets a pretty accurate computation of the number of people without jobs during the week the sampling is made. Those figures do not always jibe exactly with those of the national employment service, because they are not made up in the same way. To repeat, the figures of the employment service do not contain all those who are out of work, and do contain quite a number who have jobs but want better ones. However, they do indicate a situation about which we are all concerned, because they show 120,000 more than there were at the end of 1948 and the beginning of 1949, and 120,000 more than is normally the case.
Seasonal unemployment is a normal situation; it is unavoidable, and it is the kind of situation for which unemployment insurance was provided. If no one was going to be out of a job it would be quite senseless to be taking contributions from the workingmen, from the employers and from the government to build up a fund that never would be drawn upon. It is because we have this seasonal unemployment that we have unemployment insurance. This time unemployment insurance has been called upon to meet the most serious test since it was inaugurated, and we have come to the conclusion that it should be extended. It does not go far enough to take care of what is happening this year and what may recur in the years to come, perhaps not with the same severity but to a greater extent than we have known in the past, in the years to come.


Mr. Harris (Danforth):: May I ask just one question? I know the Prime Minister will permit this question. Is that unemployment


insurance fund clear of all other obligation, and is it immediately available for the purposes for which it was designed?


Louis Stephen St-Laurent: It is. That fund is intact and is available. Of course, there may be portions of it which have been invested in government bonds, but they can be converted within hours and paid out if there are claims which are due under the act.


Joseph Henry Harris: It hgs not been dissipated in any way?


Louis Stephen St-Laurent: In no way whatever, and it has been growing all the time. Even through these last periods, it has shown an upward curve. It is our view, and we are going to submit that view to parliament for parliament to deal with it, that there should be a further extension of security by the unemployment insurance fund.


Joseph Henry Harris: Why have parliament deal with it? Is it not an unemployment insurance fund?


Louis Stephen St-Laurent: The unemployment insurance fund is governed by a statute. All the payments that can be made under that statute have been made. It is proposed now to ask parliament to amend the statute, so that cases which could not be compensated before will be allocated funds in the future.


Joseph Henry Harris: Before, but not after?


Louis Stephen St-Laurent: After the amendment is made.
This report of unplaced persons shows a considerable regional variation in numbers applying for work in relation to the labour forces. The figures are proportionately higher in British Columbia, largely concentrated in Vancouver. Generally, that is so, but they are higher this year than for other years. The next region, taken as a whole, is the maritime region, although there are certain spots in my own province of Quebec, such as Port Alfred, La Tuque, and Shawini-gan Falls, in which the figures are higher than the average for the maritimes. This is due to the fact that so many of these localities are normally engaged in forest operations, which were curtailed during this last season.
In Ontario and the prairies, with the exception of a few special areas such as the head of the lakes, the figures have remained low. In fact, in most of these areas and in southwestern Ontario in particular, the figures are at such a level as before the war would have been considered as indicative of full employment. There is an irreducible minimum in unemployment that has to be taken care of by unemployment insurance. At the present time, the situation is clearly

The Address-Mr. St. Laurent
not one of mass national unemployment. It could better be described as spotty unemployment, applying to particular localities and industries with special severity. That is not to suggest it is any less serious or important, but it does call for a different approach and different treatment than would a general, national situation.
In that connection, I should like to say something about the state of the economy of Canada as a whole, and of the outlook as it appears to us from the information we get from those efficient civil servants to whom the hon. leader of the opposition has paid a well-deserved tribute.
We started the twentieth century with high hopes. I believe it is somewhat appropriate, at the halfway mark, to appraise the degree of achievement that has been realized. The bureau of statistics has just issued what seems to me to be a timely report entitled, "Canada at the Halfway Mark of the Twentieth Century". I understand it has been distributed to hon. members. It is published as a supplement to the February issue of the Canadian Statistical Review. It is not a detailed review, but simply a summary of the highlights.
The most significant flows and factors in our economic life, which determine our final gross national product and our standard of living, have been selected and shown in a brief, simple form. Where it has been possible, volume comparisons have been made, and comparisons between the volume at the present-day dollar, and at the dollar with a greater purchasing power. This document includes many of the figures which illustrate points I am trying to make. For example, the statistics on the labour force and unemployment, to which I have referred, are summarized in convenient form. I would point out that the bureau supplement is limited to matters of factual record, and does not include estimates and forecasts for the present year, to which I shall shortly be referring.
A glance through it shows that we have come a long way indeed since the opening of the century. Perhaps the period most interesting to us would be that of the last ten years. Production, and with it individual consumption, has increased 50 per cent per person, in terms of real goods and services, since 1939. There can be few cases where a whole nation's standard of living has increased so rapidly in such a brief period. The increase has been a balanced and healthy increase. Farm income has trebled, while farm debt has diminished quite substantially. Labour income has trebled. Our gross national product, that is the total value of all goods and services produced in the country, has tripled. Our foreign trade is nearly four times
what it was in 1939. Those gains are striking in themselves, and they are striking in comparison with what has happened in other countries.


Mr. Brooks:: What about the cost of living?


Louis Stephen St-Laurent: The cost of living index is now about 161, I believe, as against 100. With farm income three times what it was and labour income three times what it was, while the cost of living is up about one and six-tenths what it was, there is justification for my saying it has been a healthy increase.
Of course, this is due in a certain measure to the terrible destruction of the war in Europe and Asia, and to the virtual elimination for the time being of Germany and Japan as important producers, as well as the crippling of the rest of European resources and industry. But Canada showed it had a capacity to step into the gap, and consolidate and further develop this great economic expansion which has continued in the post-war years. We are today the third trader in the world in absolute terms. This may sound surprising, but per capita we trade three times as much as they do in the United States, and twice as much as they do in the United Kingdom. Ten years ago we were of little international significance as an industrial power, while today we are among the first half dozen in the world. We hold similar rank in commercial agriculture, in mining, in forestry production and in fishing. These are no mean achievements for a country with about' one-half of one per cent of the world's population; they have combined to give us a prosperous, diversified, sound economy. It is important to keep this general and really remarkable background in mind when we turn to some of the problems that face us today.
The economic outlook for 1950 is one of continuing general buoyancy, but with an increasing number of special industrial and associated area problems. Forecasts of the economic outlook are made by the economic research and development branch of the Department of Trade and Commerce for the use of the government. They provide us with a scientific and complete economic appraisal of the foreign trade and domestic business outlook, and of the trends of other significant factors, which is helpful to us in formation of policy. They are not made for publicity purposes, but are made to advise us what we have to expect, so that we may attempt to shape our policies accordingly. The forecast this year is for a gross national product of about $16,250 million, as compared with the record hitherto of $16 billion in 1949.
We anticipate little over-all price change. That means that we expect a proportionate increase in physical volume.

The Address-Mr. St. Laurent
The outlook, however, for two of the major supporting factors in our economy, domestic investment and export trade, has some marked differences. An extensive survey of the investment intentions for 1950, covering some 17,500 firms and covering all levels of government, reports an anticipated new capital expenditure in plant, machinery, equipment and housing of $3,600 million. This will be about 5 per cent in volume and value above the record figures of 1949. The direct government portion, our portion, of that is estimated at $553 million, and that figure is some 21 per cent higher than last year. This is a total of 22 per cent of the gross national product for 1950. That 22 per cent of the whole income of the country being put into development of further resources, into capital savings, to increase the productivity and amenities of the country, is an extraordinarily high figure. I agree with the leader of the opposition that all these investments are going to be good ones, and I think that they will be self-liquidating, to use the expression he himself used. But there is a limit beyond which it is not possible to go. Twenty-two per cent of the whole product of the nation going into development for its future generations is a fairly substantial sum to be putting into such development.
We must realize that, in order to have profitable and self-liquidating investments, we must have peace in the world and in order to have peace in the world we must do our share in the North Atlantic arrangement. That means that a portion, and unfortunately quite a substantial portion, of our gross national product must be devoted to the maintenance and preparation of armed forces and equipment in order to create that situation which will inspire respect in those who might be aggressors. I do not think that those armed forces and the armaments with which we are providing them are ever going to be called into action but I believe that if we did not have them we would require them. The only way in which we can'make ourselves reasonably sure that what we are investing in the development of the national resources of our country will be self-liquidating is to make, with the other signatories of the North Atlantic treaty, our contribution in maintaining a united and strong aggregation that no aggressor will feel it is an easy job to attempt to overcome.
I have mentioned these figures that are going into development according to the surveys that were made; these expenditures have a tremendous bolstering effect on both income and employment, and they obviously modernize and strengthen our productive equipment. In the five years since 1946, when this method

of accounting for capital development was started, we have put more than $14 billion into the development of our country, that is including the $3,600 million that is anticipated for this year. That of course has gone not only into plant and machinery but into all the institutional services, the hospitals, and the homes, all that can be regarded as capital investment to increase the comforts of the people of the country.
This figure is all the more striking because of the uncertainty that was felt concerning the future at the end of the war. The possibility of a sharp recession was feared and the general thinking of 1945 was that the government should be prepared to step in and help support employment and income by various measures including a large public works program should it be needed. One of the steps taken to this end was the provision of a so-called shelf or reserve of fully-planned public works which could be undertaken as conditions required. To make this particular project effective, it was felt that the active co-operation of provincial governments and municipalities should be enlisted since they normally account for about double the capital expenditure made by the federal government. This was attempted at the 1945 conference; and in addition, financial assistance was offered to stimulate and develop planning in advance, and special inducements were proposed to make it financially advantageous for provincial governments and municipalities to co-operate in the shelf project and to co-ordinate the timing or execution of these public works. It was felt that with that kind of co-ordination it would be possible to time the execution not only of such projects as were of national concern but also of those which were local responsibilities of provincial or municipal administrations, and that would have made it possible to deal not only with conditions that are apt to affect the whole economy of the nation but also with the localized or spotty unemployment situations which might arise and which could be taken care of by works that do not come under federal jurisdiction, such as municipal water works, sewers, sidewalks and pavements.
As the leader of the opposition will remember, there was even some question as to whether or not plans for a subway system in Toronto could not be part of the shelf for which planning grants would be made and toward the cost of which a contribution might be available if the work was carried' out at a time when it was required to meet unemployment situations.
But we know what happened to those plans.
. Although the effectiveness of a shelf was greatly reduced by the absence of provincial

participation, the federal government has tried to go ahead with the effort to apply the principle of proper timing to its own direct capital expenditure. But as events developed, it rapidly appeared that the immediate problem was not to plan for additional government expenditure but rather to hold public building down to the minimum in order to make labour and materials available to satisfy the private investment boom and not to intensify the strong inflationary pressures which existed.
I am sure we who are believers in private enterprise would all prefer to see the employment necessary to give a job to every Canadian man and woman who wants to work come from work provided by private enterprise, and that we feel it is only whenever it might appear that private enterprise was lagging that we should stimulate public investment so as to maintain employment and prosperity. As a further practical consideration, adequate technical personnel to carry out a program of advance planning over and above the regular departmental work was simply not available unless we attempted to compete, for those who were capable of performing that work, with private enterprise that was already employing them, and we felt that that was not the right thing to do.
It did not seem desirable, in face of the over-all shortage of scientific and technical personnel, for the government to undertake to compete for their services at the cost of restricting private business expansion. And as a result the shelf as such never reached large amounts. It was limited to a relatively narrow category of projects for which standardized plans could be prepared and filed.
As events developed, the situation evidently called for a re-examination, and a new approach was made last year.
Not only has the nature of the unemployment we were providing for changed radically from the possibilities envisaged in 1945, but the practical experience acquired in attempting to develop a shelf without provincial and municipal co-operation indicated the need of a more flexible method of preparing to meet possible eventualities. A survey was made last year of the state of planning of all capital projects of the federal government, including some, like the trans-Canada highway, to be executed jointly with provincial governments. I am talking now about government projects only, federal, provincial and municipal. Projects which were completely planned as of March 31 last year, and in some cases already under way, totalled $722 million. Projects in various stages of planning from the survey to the detailed preparation stage, amounted to approximately $1 billion. A third category of projects to which
The Address-Mr. St. Laurent preliminary consideration had been given, and for which preliminary plans were ready and which could be executed within a period of not more than five years, were put at $1,300 million. The total of these three categories, themselves amounting to some 5,000 projects, had a value of some $3 billion, quite a substantial sum, but less than is going to be done in this one year under the intentions we have ascertained from the survey of private enterprise as well as government authorities.


Mr. Macdonnell (Greenwood):: Will the
Prime Minister permit a question? He gave us the figure of federal expenditure for the coming year. Has the Prime Minister the provincial figure?


Louis Stephen St-Laurent: No, I am sorry I have not. I understand that it is very large. It is included in the $3,600 million. I understand that in the province of Ontario it is something of the order of $25 million a month for the year.
There are also obvious practical limitations in launching any large building project in the dead of winter to meet some abnormal seasonal unemployment. That just cannot be done. No relief could have been afforded to Vancouver at any time since this situation developed by launching any further building project out there.
The results of the survey satisfied the government that the shelf concept, when limited to its own public investment program, was not the best approach at the present time. The approach now is one of greater co-ordination and expansion of departmental . programs for such works as are purely federal, and renewed efforts to secure provincial co-operation in such national undertakings as the trans-Canada highway, natural resources development and conservation and local housing schemes.
A word of warning should be sounded about the effectiveness of a public works program as a cure-all for unemployment. Such a program necessarily operates through the construction industry. Where that industry is lagging, anything done to activate it stimulates the whole economy. But ever since 1945 our construction [DOT] industry has enjoyed a very high level of activity, and our survey indicates that private enterprise is going to keep it very active throughout the whole of this year.
It is also true that construction costs remain high though the availability of supplies and the greater productivity of labour have brought about some reduction. Still any unnecessary competition by government with private enterprise for the available supplies
58	HOUSE OF
The Address-Mr. St. Laurent and the available skilled labour in the construction industry at this time would not appear to be very helpful in increasing overall employment in that industry. Unless it could be likely to increase over-all employment there is no point in spending public money instead of having private enterprise invest its own money in its own way.
Another consideration which is sometimes overlooked is that the type of public project which the federal authorities could undertake might not be at all suitable for the kind of people in a given area who are in need of work. In considering the possible role of public works today, and the present usefulness of a shelf, we must give particular emphasis to the nature of the unemployment and the general conditions prevailing in the economy. As I have said unemployment today arises from a softness, to some extent seasonal, which is concentrated largely in a few specialized industries and areas. The national responsibility to which this government is committed is to do all in its power to maintain a high national level of employment and income. And this, in spite of some serious external difficulties, we have succeeded in doing and we are confident that we shall continue to do so. This is a very different matter, however, from taking federal action to meet special local situations when the general level of prosperity is as high as it is in Canada today.
Whenever it is felt that some local situation should be taken care of by proceeding with works which are of concern to the authorities of that locality, it must not be forgotten that municipal institutions are agencies of the . province; and if provincial autonomy means anything, it must mean that we should not attempt to deal with municipal problems without the intervention of the provincial governments. That does not mean that we are not concerned with the well-being of all Canadians, wherever they happen to be, and that we will not always attempt to time our own public works and expenditures so that the residue of any local problem over and above the national average may be as light as possible. But there will inevitably be some residuary problems from time to time in some areas, and the initiative in dealing with them must be taken by the local authorities. If they need assistance they should go first to their provincial governments, and if both they and the provincial authorities feel that there are grounds for federal help in the interest of the nation as a whole, the request for federal intervention should be made by and through the provincial authorities.


It is not very consistent to talk about provincial autonomy and then attempt to put on the federal doorstep every practical problem that crops up.
I believe that in looking to the future special emphasis should be placed on natural resources development and conservation policies. In that I find myself in agreement with the leader of the opposition. This is a field that today has more promise than ever before, and has particular interest for us because of the eventual effect it will have on our trade picture. Alberta oil, Steep Rock and Labrador iron ores, and Quebec titanium, and more scientific use of our forest resources, are outstanding examples of resources development which can and will make a radical change in our present unbalanced trade picture vis-a-vis the United States. While our domestic investment boom promises to continue at increasing records, there are many to whom our'export prospects do not appear to be so encouraging. Our primary difficulty can be put as simply as one, two, three. One, we buy more from the United States than we are able to sell them; two, we sell more to the rest of the world than we buy from them; and three, our customers are unable to provide the United States dollars which would enable us to balance one against the other. And that is not just a problem of convertibility. The dollars or pounds are merely symbols; and unless there are the commodities available that those dollars or pounds would call for, they are of no immediate use.
I noticed the other day that Sir Stafford Cripps answered the same question put to him, in an interview, when he was asked about the possibility of Canada taking sterling for our sales to them. He said, "Of course that would be merely another way of extending a further loan to us, without interest." That must be realized-and I am sure it is realized, that the people of Canada know that we want to export. As the leader of the opposition (Mr. Drew) has said, we want to find markets for our increasing production; but we do not want to find markets which will absorb our products and give us nothing in return. That is why we are doing our best, as stated in the speech from the throne, to facilitate the earning of Canadian dollars by our European customers. It is going to be a little painful for some of us in some quarters; but I think it is the only way by which we can reach that goal of convertibility

that is to say, that goal where we would not be giving our goods away, and where we would not ourselves continue to be providing by loans the Canadian dollars with which they will pay. Because those loans of Canadian dollars will eventually have to be

either written off or reimbursed in commodities. We will have to take goods for everything owed to us-or take nothing.
It is true that at the present time part of our overseas exports are dependent upon the continued extension of United States credit and grants to Europe. Perhaps we would not lose very much of our present sales to Europe through ECA offshore purchasing if this were discontinued. But it would be an important fraction, particularly to some individual groups and areas, if it were not offset by increased imports from Europe. Our own balance of payments position now gives us very little room to extend further credits ourselves.
At the same time a significant amount of our industrial raw material and consumer goods requirements is dependent on our finding the United States dollars to meet our deficit there. We are therefore in a vulnerable position on both export and import accounts. That is why the development of our resources, particularly in such things as oil and iron for which we are so heavily dependent on the United States, is of double advantage. It expands our own production income and wealth, and it helps meet the United States dollar problem to which our trade is so vulnerable.
May I give only two examples, one of the saving of United States dollars, and the other of the earning of United States dollars. Our exports to the United States in 194V were valued at about $1,056 million, while in 1949 they were $1,524 million. This is an increase of half a billion dollars in 1949 over 1947.
In 1948 our petroleum imports were valued at $301 million, and in 1949 we had reduced them to $274 million. The crude we produced in Canada in 1948 amounted to 12,287,000 barrels at an estimated value of $37,419,000. The crude produced in Canada in 1949, to the extent of 22,210,000 barrels, had an estimated value of $62,333,000.
We believe, and indeed I should think everyone in the house believes, that there are oil resources in Alberta sufficient to equal the consumption of the whole Canadian nation. It may not be possible or economical to deliver that oil to consumption points throughout Canada. But we can hope that what we will have over the requirements of those who can get it at economical transportation costs can be sold elsewhere so as to provide us with the dollars necessary to continue to purchase from the United States equivalent quantities to be consumed in eastern parts which are not accessible, under economic conditions, to the oil wells of Alberta.
20, 1950
The Address-Mr. St. Laurent
Then, concerning the export of iron ore, I have before me only those figures for the Steep Rock mine. They show that in 1948 there were 670,000 tons, and in 1949, 1,068,000 tons. That is increasing; and there are prospects from the tremendous deposits in northeastern Quebec and Labrador. There are possibilities of tremendous expansion in the export of titanium ores from the north shore of the St. Lawrence river.
I believe we have reason to look to the future with some confidence. We have these balance-of-payment difficulties, but we expect our balance of payments with the United States will be improved during 1950. On the other hand, for reasons which are not within our control or significant influence, we must accept some reduction in our sales to the rest of the world. The net over-all effect is estimated to be that our 1950 imports will remain at the 1949 level, although with some change in national sources of procurement. We hope that more will come from sterling sources and less from American-dollar sources.
Our total exports and our balance of trade may be down as much as $250 million. has serious implications in that it will be borne unequally by different industries and different areas, and it will contribute to the spotty nature and rather specialized soft spots of our economy during this year. However, that should not be a major factor in increasing unemployment.
Up to now, thanks to the buoyancy of the domestic market, many of the manufacturing industries adversely affected have been able to replace lost export sales with domestic sales. More adverse effects may be felt by some relatively specialized groups of primary producers for whom Europe has been the chief, or price determining, market.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Louis Stephen St-Laurent: Mr. Speaker, the last
point I was endeavouring to make before the dinner recess was that the two major factors expected to have a significant influence on the level of employment and income during 1950 were the level of our domestic investments and the level of our overseas exports. It is true it so happens that in dollar terms the rise in domestic investment will just about offset the expected drop in the volume of our overseas exports, but we must recognize the fact that things will not average out
GO	HOUSE OF
The Address-Mr. St. Laurent as neatly as all that for the individuals concerned. That is why the measures which the government will take to deal with our economic problems this year will of necessity be flexible, be selective and be designed to meet special situations rather than anything in the nature of a grandiose over-all blueprint for the general economy of the nation.
I have already indicated that these measures consist first of all of the extension of unemployment insurance to take care of a larger volume of unemployment than was normally to be expected; second, the extension of authority for price support of agricultural and fisheries products to ease the impact of the readjustment which is necessary, and which everyone had realized would be necessary. Then we wish to go ahead as rapidly as possible with the trans-Canada highway, and negotiations are being pursued actively with the provincial administrations to bring that about. We are also anxious to get ahead with further housing. Further housing is required, and hon. members know that the provisions of the National Housing Act were liberalized by amendments made at the last session to provide for maintaining activity in the construction of residential housing. We are also negotiating with the provincial administrations along the lines authorized by the legislation adopted at the last session with respect to forestry and the conservation of other natural resources.
In addition to what will be taken care of in that way there may remain some residual local problems, but there is probably no locality where there is unemployment today that could not stand more housing construction. If they will co-operate that will do much to relieve all that can be relieved by means of the construction industry. There are probably not many localities where there is unemployment that could not stand more municipal improvements such as water works, sewers, sidewalks, paving, and so forth. Our municipalities are all in a good sound situation at the present time, and can consider the prosecution of local improvements if they feel that the employment situation in their midst would be benefited thereby.
During the dinner recess I saw an editorial in today's Ottawa Journal which may require me to take a little more than the ten minutes I anticipated before the recess. The editorial is headed:
Unemployment Insurance doesn't make jobs.
That is partially true. Unemployment insurance does not create new jobs, but unemployment insurance, like all other measures which have been taken to distribute 

purchasing power, maintains jobs and maintains economic activity. As I said before, that results from the distribution of purchasing power under the veterans' charter, from its distribution under the Family Allowances Act, from the increase in old age pensions, and from the substantial amounts that have been paid out under existing legislation respecting unemployment insurance.
As to pensions, it is true there was no specific reference thereto in the speech from the throne, and that a motion has been put on the order paper calling for the setting up of a committee to look into the whole matter; but I do wish to repudiate the charge that there has been any change in the attitude of the government. In December, 1948, shortly after I had assumed the responsibilities of the office I now occupy, I stated what the policy was in that respect. Part of what I said at that time was:
There are also old age pensions. The Liberal party is not fully satisfied with the present old age pension scheme even though old age pensions were started by a Liberal government. The Liberal aim is a contributory scheme in which everyone can pay in something during his working years to help provide security for his old age. But a contributory plan will require an agreement with the provincial go\ ernments, and so far it has not been possible to reach such an agreement.
That is exactly the substance of what I said during the election campaign. I referred to it in a national broadcast made from Moncton on the 19th of May, 1949. At that time I said:
In a broadcast last December I said it was the policy of the Liberal party to improve the present old age pension scheme. One big advance was the increase of $10 a month in the pension made last month.
I was speaking in May, and the increase of $10 had been provided in legislation adopted in April.
But the Liberal aim is a contributory system in which everyone can pay in something in his working years to help provide security as a matter of right in his old age. Contributory old age pensions, like health insurance, require an agreement with the provinces, and so far it has not been possible to reach such an agreement.
It has not been possible yet to reach such an agreement. I added at that time:
But we are going to continue to work for an agreement, and meanwhile, as I have said, something substantial has been done this year for the old age pensioners.
We have provided for another conference with the provincial authorities to take place early in the fall. In the amendment moved by the leader of the opposition (Mr. Drew) there is a charge of failure, in these terms:
Failed to take steps to inaugurate a national contributory system of old age pensions without a means test.

I am wondering whether that means that our failure consists in not doing it without an agreement with the provinces. We do not think it can be done. We do not think there can be contributions required for the specific purpose of old age pensions, or any other security benefits, without an agreement with the provinces. I find it rather strange that the hon. gentleman who is so insistent about provincial autonomy should be charging us with failure to do something which cannot be done without that agreement.


George Alexander Drew: Which you never sought.


Mr.   Si. Laureni@: I did not catch what the hon. member said.


George Alexander Drew: And which you never sought.


Mr.   Si. Laureni@: Which we never sought?


George Alexander Drew: Never.


Mr.   Si. Laureni@: 
Some hon. Members:: He sure would.


Louis Stephen St-Laurent: Oh, yes; hon. gentlemen may laugh about that; but the minister does talk even to his best friends, whether or not he agrees with them, in such a way that we always know where he stands and what is his position. I said and I believed that if I were to make that statement he would get up at once and tell me I was mistaken. Then I added:
He knows the problems are still thorny and there is no easy solution-but I will venture the prediction that if Mr. Howe and those who are working with him don't find a solution, there won't be one to find.
I made a similar statement on May 18 at Amherst, when I said:
Now it is quite true that the maintenance of markets for our surplus production is a problem. It is a problem not because of any condition in Canada but because of the dislocation of trade and the destruction of productive capacity in our former markets overseas. The restoration of the British market and western European markets has been a problem, a continuing problem, ever since the end of the war. And it is going to continue to be a problem for a good many years yet. But the fact is that up to the present, Canadian exporters, with pretty active co-operation from the government, have been able to find markets for nearly all they produce which cannot be sold profitably in Canada.
I made similar statements on May 19 in a broadcast from Moncton; on June 1 at Owen Sound; on June 4 at Hamilton; on June 15 at Pembroke; on June 21 at Toronto; and on June 24 at St. John's, Newfoundland. In those statements I said it was a serious problem but I did not believe-and I do not believe-any man in Canada is better qualified to handle it than the Minister of Trade and Commerce.
Now I should say a word about old age pensions. We are asking the house to set up a committee to look at all aspects of the problem, because there are aspects as to which it will be very valuable for all hon. members to have as much information and as much of the factual background as possible. I have gone into the matter to a certain extent, though not the extent to which it will be gone into by the committee. I have obtained some preliminary figures. As of September 30, 1949, some 265,000 old age pensioners were qualified under the means test. At that time

The Address-Mr. St. Laurent if there had been no means test and the pension had been payable as a matter of right to all persons over seventy, some 670,000 persons would have been entitled to receive it. The expenditure, instead of being $99 million at the rate of $40 a month, would have been $322 million. At the rate of $50 a month it would have been $404 million; at $60 a month it would have been $485 million; and at $100 a month, as some suggested, it would have been $807 million. If the age limit were reduced to sixty-five, at $40 a month the cost would be $528 million; at $50 a month it would be $660 million; at $60 a month it would be $790 million; and at $100 a month it would be $1,319 million.
I also inquired as to the estimated revenue to be derived from the personal income tax for the year 1950. I was told the estimate was $603 million. Of course government revenues must be devoted to other things as well as old age pensions. The estimate of the amount to be distributed under the family allowance scheme in 1950-51 is from $306 million to $307 million. With respect to the means test, some people suggest that if it were abolished we would get back most of what was paid out in old age pensions in the form of income tax from those who would receive it. Well, I had that suggestion looked into also. I find that of our population of about 13,500,000 some 8,500,000 are twenty years of age or over. Of that number some
2,311,000	are subject to income tax. But in order to pay at a rate that would give back as much as half in income tax, one has to be in the $25,000 bracket. It is only over $25,000 that the income tax amounts to 50 per cent of the income. The number of those with incomes of $25,000 or over in the whole population, out of the 2,311,000 taxpayers, is 5,735, or one-quarter of one per cent of those who are liable to income tax. Of the 670,000 who would be 70 years of age and entitled to old age pensions without a means test, if the distribution were the same, 36 per cent of them would be liable to income tax, that is 241,000. However, less than 1,000 of them would be in the $25,000 bracket and liable to return to the treasury, in income tax, as much as one-half of what they received in the form of old age pensions. I think that clearly demonstrates that the only practical way in which an old age pension scheme without a means test could be provided is through a direct contributory system. It is that goal towards which we are working.


Stanley Howard Knowles: That was not the federal government's offer to the provinces in 1945. Was that offer not made without its involving a contributory system?


Louis Stephen St-Laurent: No, it was not. I think that if the hon. member will refer to the proposition he will find there never was any offer of a pension without a means test and without a contribution. There could not be, because it just would not work. We cannot have that proportion of the income of the nation derived from ordinary taxation devoted to old age pensions. We are all sympathetic to the old age pensioners, but why should I, within the next two years, get a pension of $40 per month and hand back only something of the order of 45 or 50 per cent of it to the treasury? Is that required in the interests of the Canadian nation?
The means test has been called the meanest test. It is unfortunate that there must be some kind of inquiry as to whether or not it is proper that a pension should be paid at the expense of the taxpayer, unless it is a matter of contract under which the one who gets it without a means test has made some contribution. This is an extremely difficult problem to handle. It is no doubt desirable that our aged citizens be provided for reasonably well. But there are other requirements of the national economy that have to be considered. I am convinced that the only way in which a pension, as of right, can be paid to Canadians who reach the age is on a direct contributory system. Then, when we have a direct contributory system, we will get what we pay for, and we will pay for what we get. When suggestions are made that the old age pension be increased by 50 per cent, it will be something for consideration. It will mean, however, that the contributions will also have to be increased by 50 per cent, so we will get what we pay for, and we will have to be prepared to pay for what we are going to get.


William Earl Rowe: That was not what you said before the election.


Jean-Paul Stephen St-Laurent: The hon. gentleman says it should have been mentioned before the election. Was he not here when I read the statements that were made?


William Earl Rowe: I was imthe country, and I heard you in the country.


Jean-Paul Stephen St-Laurent: My hon. friend never heard me say anything else.


William Earl Rowe: But I heard your supporters say it.


Jean-Paul Stephen St-Laurent: If my hon. friend heard all my supporters, he must be a ubiquitous gentleman, because there were many supporters all over the country from one ocean to the other. If the hon. gentleman heard that, his ears must be even longer than those of an animal whose name I shall not mention.


William Earl Rowe: The animal you mention would not put it that way. We heard you before the election, do not worry about that. You never made that explanation yourself before the election.


Jean-Paul Stephen St-Laurent: I think my friend is hearing more than he likes to hear now. He should perhaps join the club of those who have ears and do not hear. There will be an opportunity for the hon. member to make his speech if he thinks he wants to make one.


William Earl Rowe: 1 will make one, and I will answer you, too.


Mr. Speaker:: Order.


Jean-Paul Stephen St-Laurent: I have dealt with two of the extraordinary assertions of this motion to amend the motion for an address. Number 1 said:
failed to take adequate measures to preserve and expand markets for Canada's surplus products of farm, forest, sea and mine, and to deal with the problems of increasing unemployment and reduced income to Canadian farmers and other producers
There may be some who say we are facing a national emergency which requires extraordinary measures. I do not believe we are.
I think that these are localized situations which require special measures, and that the special measures I have indicated will take care of that problem.
The next paragraph states that we failed to take steps to inaugurate a national contributory system of old age pensions without a means test. We are going to have a conference in the fall. In the meantime, we intend to secure all the information that could have a bearing upon conclusions it would be proper to arrive at at that conference.
Number 3 reads as follows:
deliberately violated a law of this parliament by illegally supressing the report of the commissioner under the Combines Investigation Act on the flour milling industry for ten months, including the period of the recent general election campaign, and denied to parliament information essential to the performance of its duty and the maintenance of responsible government ....
I am not going to rehash the debate on the report of the commissioner with respect to the milling industry, which we had during the last session of parliament.


An hon. Member:: It is true.


Jean-Paul Stephen St-Laurent: If hon. members want to hear it discussed, there will be other members on this side who will discuss it.


William Earl Rowe: There is nothing more to say about it.


Jean-Paul Stephen St-Laurent: I would appreciate it if, for the next three or four minutes, the hon. member had nothing more to say.
The Address-Mr. St. Laurent The fourth item concerns the failure to take adequate measures to curb espionage and other harmful activities of communists in Canada. The leader of the opposition said in that connection that the Minister of Justice (Mr. Garson) had made a statement admitting the existence of spying activities, and so forth. There was a report, published by the B.U.P., which was later corrected. I have here exactly what the Minister of Justice said in that respect, and I am going to take the time to read it if I may. It reads:
In considering our security position now and what it might be in the event of another world war we can reach certain conclusions from what has happened in other countries, and from the attitudes of some of our own citizens and residents in Canada itself. In several countries, espionage, infiltration, sabotage and fomenting of discontent and disaffection, the staging of coups d'etat have been used as weapons of war. In our own country we have those who have given repeated demonstration of their unsympathetic and disloyal attitude towards our institutions and our form of government.
Those of us who have some share of responsibility for security take cognizance of these and other facts and have already taken measures to guard against them. But just as those who plot against the security of Canada do not discuss their plans in the forum or from the housetops, so we who prepare counter-measures to frustrate their plot could make few greater mistakes than to specify and advertise what we have done and what we are prepared to do. To follow this course would transform our security measures into their very opposite.
Hon. members will ask themselves whether or not that is a reasonable position to take.


James MacKerras Macdonnell: Would the
Prime Minister permit a question?


Louis Stephen St-Laurent: Certainly.


James MacKerras Macdonnell: Do I understand the Prime Minister to say that that is what I think he called the retracted statement? Is that the corrected version of what was in the press attributed to the Minister of Justice?


Mr.   Si. Laureni@: That is the statement
which was given to the press before the wrong version was put in.


William Earl Rowe: It is too bad that the press is not fair to you.


Mr.   Si. Laureni@: The hon. gentleman is not the only person who we think is sometimes unfair to us. With respect to communist activities, in our understanding measures are other things than mere words, and we think that actions speak louder than words. When action was required, action was taken; and I was obliged to submit to fairly severe criticism from the other side of the house for the action that was taken. I did not regret it then and I do not regret it now. But when action requires to be taken, we think that

The Address-Mr. St. Laurent we shall have the courage, as we had then, to take it and to carry it to its full implementation.
I should like to close by calling attention to an editorial in the Montreal Star, because it is not everybody in Canada who has this gloomy view of what this year 1950 portends because it happens to be a year when the affairs of the country will be under the direction of a Liberal government. The article is entitled, "1950, A Year of Adjustment". This article appeared in the Montreal Star of February 17, and it reads as follows:
The probable pattern of future parliamentary debate can be seen more readily in the pre-session speeches of opposition leaders than in the studiously colorless language of the speech from the throne.
Perhaps it was studiously colorless because we did not think the occasion required any flamboyant language. The article continues:
It can be predicted therefore that the storm of criticism shortly to descend on the government will concentrate on two points-the rise in urban unemployment and the decline in farm prices.
It is important not to add fear to the factors which contribute to any period of adjustment, for fear can induce declines greater than the basic economic situation calls for.
We know from experience that fear added to the motives which induced the pulp and paper companies to reduce their cut of pulp-wood substantially during the last season in spite of the fact that their sales are at higher levels than ever before. The article continues:
A pendulum swing can be created instead of a minor oscillation. For this reason it may be hoped that the public will keep its head when the oratory starts. We have had rising employment and rising farm income every year now since 1939. The Bank of Canada statistics show that we have safely absorbed our'increase in population and that the actual net production of wealth has been steadily going up.
Without minimizing the difficulties that arise from unemployment and lower prices, it is important to remember that things are not going badly with Canada, There is no reason to doubt the fundamentally optimistic statements in the speech from the throne. Judged by any reasonable standard, 1950 should be a pretty good year.
On the other hand, it would be idle to play ostrich and pretend that there are no clouds on the horizon. There are. Canada remains fundamentally a country built upon its export trade. Its farm and industrial capacity both are far greater than any required for domestic needs, and the international trading world is in a sorry state. The first stage of post-war reconstruction has been completed. Production is rising steadily and this means stiffer competition in export markets.
On top of that is the basic difficulty in creating a sound balance of international accounts. The world is being divided into trading blocs, and the Canadian position in it is obviously an uncomfortable one. We buy in one bloc, and we sell in another, and there is no quick solution for this problem. Very slowly certain new trends and patterns of trade are being established but this involves transition, and that kind of change is not easy to effect. 
It is, we think, in the light of that basic fact that the government's policy should be judged. We are not likely to see introduced into parliament any fine, hew, permanent cure-all of our difficulties. More likely we will see remedial measures of one kind or another, and these should be judged by special standards. On the one hand, do they help us over an immediate hurdle? On the other, do they tend to create a situation which will make eventual solutions more difficult of attainment? If the answer to the first question is, Yes, and the answer to the second question, No, it would be rash to reject them.
The situation is one that calls for moderation in both policy and the criticism of it. The impatient prince in ancient days who complained to his tutors that they were making him work too hard was told that there was no royal road to knowledge. There is no easy, royal road to a stable and prosperous world either. We must work our way along it, step by step.
I think we shall take the proper steps during this session of parliament.


Mr. M. J. Coldwell (Roseiown -Biggar):: May
I, Mr. Speaker, join with the Leader of the Opposition (Mr. Drew) and the Prime Minister (Mr. St. Laurent) in congratulating the mover and the seconder of the address. I think it is always well and acceptable to the house when two young men, recently come into this chamber, are given the honour of making this motion. It is both a privilege and an honour to be selected for this purpose, and I congratulate them.
With most of the criticisms made by the leader of the opposition this afternoon I find myself in agreement. Last session we had before us the matter of the flour-milling report and it was discussed fairly thoroughly. We raised the matter first because we discovered that the report had not been made public. Consequently I agree with the criticism made by the leader of the opposition this afternoon with regard to that episode. The same thing, of course, applies to the rising unemployment, the loss of markets, the lowering of farm prices and so on. Because of the fact that my time is limited by the rules of the house I propose to deal with only two or three matters this evening. Before I do so, however, I want to comment on the omission from the speech from the throne, which we immediately regretted, of any reference to old age pension legislation. It is true that a resolution to set up a committee of both houses of parliament to review old age pension legislation and to consider the means test has been placed on the order paper by the Minister of National Health and Welfare (Mr. Martin). As the Prime Minister has just indicated quite clearly, this matter has been under discussion in this house for a good many years. In fact, largely owing to the efforts of the first leader of the C.C.F. movement, Mr. J. S. Woodsworth, the first old age pension bill was introduced into this chamber

in 1926. We have taken great interest in the matter ever since and have raised it at practically every session of parliament since we have been here. Hence it seems to me that the proposal to set up another committee to consider the matter of old age pension legislation in all its aspects may be criticized in language used by the former prime minister of Canada, Right Hon. W. L. Mackenzie King, when Right Hon. R. B. Bennett set up a committee some years ago to consider the matter of current price spreads, a matter which was fairly well understood across the country. Mr. King said this as reported at page 190 of Hansard, February 2, 1934:
The motion is in large part one of postponing action. What the country is interested in is not so much further inquiry with respect to matters about which nearly everyone knows a great deal, but legislation, if more is required, to meet a situation that is already understood.
That is a very apt quotation and could be applied to the old age pensions legislation and to the proposed resolution of the Minister of National Health and Welfare (Mr. Martin).
I was amazed just now to hear the Prime Minister (Mr. St. Laurent) contradict the statement made by the leader of the opposition (Mr. Drew) and by the hon. member for Winnipeg North Centre (Mr. Knowles) when he questioned the Prime Minister concerning the proposals that were actually made by the federal government in 1945 to the dominion-provincial conference. One of my colleagues went upstairs and got me the green book containing the official proposals of the government of Canada. What did the government say? At page 37, under the heading "Summary of the federal government proposals", the following appears:
The federal*government's proposals are twofold:
(a) National old age pensions at age 70.
As part of the general proposals now put before the conference, it is proposed that the federal government would establish a system of national old age pensions entirely financed and administered by the federal government, and paid at the uniform rate of $30 per month regardless of means to men and women aged 70 and over in all parts of Canada.
Then the proposal went on to say:
The cost of national old age pensions by 1948, for example, is estimated at $200 million. (For details see table I below.) There would be a partial recovery from people over 70 paying income tax.
The other proposal was that the age for old age pension should be reduced to 65 but that from 65 to 69 the pension would be shared fifty-fifty between the provinces and the dominion.
There are the proposals.


Jean-Paul Stephen St-Laurent: That is not the whole- 55946-5
The Address-Mr. Coldwell


Major James William Coldwell: I know of no other proposals placed before the dominion-provincial conference in August, 1945. I believe these were the last proposals. May I say this? From time to time during election periods advertising has appeared put out by the National Liberal Federation which clearly promised old age pensions without a means test. As a matter of fact I have a copy of one of them.


Alcide Côté: What year?


Major James William Coldwell: The one to which I referred was published in all the metropolitan daily papers of Canada on June 5, 1945. This one says, "Old age pensions, higher pensions, lower age limit, no means test." But the proposals that were placed before the dominion-provincial conference were placed there as I have read them from the official record of the government at the time.


Louis Stephen St-Laurent: If the hon. member is not using the book, would he mind sending it across to me?


Major James William Coldwell: Certainly. This evening I am going to discuss two or three problems which should receive the consideration of the house. I take it that thoughtful Canadians, like thoughtful people everywhere, are worried at the present time about the international situation. Economically, clouds have been gathering on the horizon, but more disturbing still, I think, is the intensification of the so-called cold war and the dangers of it developing into a staggering and devastating conflict, a development which the plain ordinary common people in all places dread and fear.
One phase of the problem of peace is uppermost in many minds, the international control of that mighty power inherent in atomic energy, of atomic bombs and of radioactive material which exists in quantity and indeed in sufficient quantity to wipe out all life over wide regions of this earth. But I doubt whether more than a few people have yet grasped the significance of President Truman's announcement that he had authorized scientists to proceed with the production of the hydrogen bomb. Scientists are endeavouring to tell the world what this really means. Two weeks ago twelve of the leading physicists of the United States issued the warning that the hydrogen bomb is not a weapon of war but an agent of mass destruction. They said this:
The thermo nuclear reaction on which the H-bomb is based is limited in its power only by the amount of hydrogen which can be carried in the bomb. Even if the power were limited to one thousand times that of the present atomic bomb the step from an A to an H-bomb would be as great as that from an ordinary TNT bomb to an atom bomb. New York, or any other of the greatest cities of the world, could be destroyed by a single hydrogen bomb.
66	HOUSE OF
The Address-Mr. Coldwell
Then they went on to say that, in case we believe we can rely on our security because our side is making it first:
It is certain that the Russians will be able to make one too.
They added that it was indeed possible that the Russians were engaged at the present time in making such a bomb. Those of us who have had the privilege in this house of knowing something about atomic energy through visiting Chalk River and sitting on the committee that was set up and, I hope, will be re-established, and who followed the developments and the discussions on atomic energy since the first bomb was dropped on Hiroshima, can be under no illusions as to what or who has blocked an effective international control of atomic weapons until now. Putting it baldly, it has been the insistence of the Soviet union on complete national sovereignty and their refusal to agree on more than limited and therefore ineffective control and inspection by an international body under the United Nations. The new developments make the outlawing of atomic weapons more urgent than ever. But any outlawing of these weapons must be accompanied of course by effective control, effective inspection and control such as will remove any possibility of atomic weapons being made secretly in any country in the world. I say that up to the present time all efforts to achieve this desirable end have failed; but I believe that new attempts should be made to secure an agreement now. I say to the Secretary of State for External Affairs tMr. Pearson) that I believe Canada might take the initiative in this regard. At the same time, if that is done, it should be accompanied by a new crusade for world peace, which I believe can be secured to all mankind only by the abolition of war itself as an instrument of national policy. That was the idea behind the United Nations when it was organized. Now that the Russians at least have the atomic bomb and the monopoly on our side has gone, perhaps there may be greater chances of success in reaching an agreement than there were before; I do not know. But let us hope so. In any event it seems to me we are now faced with two alternatives: One is to despair, to organize our side of the iron curtain and engage in a furious and intolerable armament race; the other is to bend every effort to find an acceptable plan for international control and inspection, and proceed at the same time to remove from the world the age-old causes of war.
In support of the second alternative no less a person than the joint chairman of the United States congressional committee on atomic


energy, Senator McMahon, has made a significant and worth-while proposal. He calculated that at the present time the United States is spending $15 billion a year on armaments and war preparedness. He therefore proposed publicly the other day that the United States might begin by offering the world, through the United Nations, two-thirds of that sum for five years-and on two conditions: the first condition was a general acceptance of a satisfactory program for the effective control of atomic energy and, the second, an agreement by all countries, and enforced by inspection, that two-thirds of their present spending upon armaments would be devoted to constructive ends.
This proposal received amazing support, as I think, from members of all parties in the United States. Even an old and unyielding isolationist like Senator John Bricker of Ohio said this:
If we can get an agreement for air-tight control and true international inspection for $50 billion, I would grab at the chance.
Senator McMahon said that he desired the development of atomic energy everywhere for peace and that he was prepared to give general economic aid and help to all countries which would accept the two conditions he made, and he included Russia. Then he added:
Such a global Marshall plan might combine with the marvellous power of peacetime energy to generate universal material progress and a universal co-operative spirit.
Such a proposal surely is one which, if we have the opportunity, Canada should support, both from the idealistic standpoint and, to place it on a lower level, for selfish reasons. Because of world impoverishment we face a grave crisis both in agriculture and in labour. It is no good saying that we should not fear. If we do not fear we may not find any solution, and indeed we may find ourselves in the position of the ostrich, with our heads buried and not seeing what is threatened around us.
I have said that this is a crisis in both agriculture and labour. But of course, in reality, the welfare of all Canadians is involved, and the problems faced by farmers and industrial workers are a part of a single problem, not two separate problems.
At present we are told, and told authoritatively, that only one-third of the world's two and a quarter billions of people receive sufficient food. The other two-thirds, as they did before the war, live on a marginal level of existence, a state of semi-starvation. We now have, as never before, the possibility of removing from men this age-old struggle against undeserved poverty, misery and want. That is what the right use of this challenging new power offers as the alternative-to what? -to war and mass destruction. Stealing across the world today, feeding on the misery

of the exploited and the distressed masses, is what?-the promise of improved conditions in exchange for those freedoms of thought, speech and worship which we believe to be essential to the good life.
This explains of course what' has happened in China. It may happen elsewhere if the democratic nations fail to take effective steps immediately to feed the hungry, clothe the naked and rescue the exploited. Of course the former policy of giving unconditional aid to corrupt regimes, as in China, has played right into the hands of the communist leaders, and scattered in the Far East seeds of distrust against the west.
I believe we must now try to undo as much of the evil of the immediate and the distant past as we can. I say to the Secretary of State for External Affairs (Mr. Pearson) that I do not think any gain can be had by cutting ourselves completely off from the teeming millions of China and a large part of the Far East. In other words, I think we shall lose, rather than gain, by refusing to recognize that the Chinese have a new, if revolutionary, government. Recognition, as we well know, does not in fact involve the approval of any regime. We have recognized, and properly so, governments of countries whose people assisted in winning the war against the fascist, nazi and Japanese aggressors, as did the Chinese, even when we have disliked or abhorred their political philosophies.
Hence we should make no exception in the case of China. In our opinion the government should grant recognition at an early date. As the Secretary of State for External Affairs is reported to have remarked recently, the centre of world interest is now Asia, and perhaps more explicitly southeast Asia. At the moment Indo-China, Burma, Indonesia and other countries are feeling the impact of a new and threatening conquest. The offensive is largely ideological-in the realm of ideas, which fall on fertile ground because of age-old poverty, suffering and exploitation.
This cannot be met with military might. Soviet communism, fascism, or any other totalitarian threat, cannot be stopped by guns and bombs alone. I am not implying that, with the dangers existing all around us, we should not, until we get proper collective security, take measures to protect ourselves. But surely we should understand by now that communism, like fascism, feeds on poverty, hunger, misery and insecurity. The best and, indeed, the only way eventually to defeat communism or any of these other totalitarian cults is to offer and establish conditions so that people are well fed, healthy, properly clothed and housed and- I add one other-free.
The Address-Mr. Coldwell
So we say we believe that unless economic assistance is forthcoming, perhaps particularly for the people of southeast Asia, and soon, we shall have lost the cold war in that part of the world. That is why I think a new attempt to stop the armament race and the acceptance of proposals to utilize our common resources for human progress should appeal so strongly to all of us, particularly if we can hope to succeed in bringing such an idea to fruition.
I noted that the Secretary of State for External Affairs (Mr. Pearson) was reported to have said that Canada had already overextended herself in giving economic aid. I am glad he shakes his head, although that is what the press report indicated. If that were said, may I say that we and the United States are the only countries with surpluses of food and raw materials so necessary for the winning of the war against poverty. As long as we have farm surpluses, as long as we have unemployment, we have the means, if we will use them, of making a still greater contribution to the winning of the cold war which is, as I have said, made possible by widespread poverty, misery and want. I am not implying, nor have I implied, that we can do this alone, but we should be pressing and urging on every occasion for the acceptance of an international economic plan or plans for meeting the needs of the undeveloped, war-devastated and impoverished countries of the world.
By international planning I do not mean planning primarily for private gain but international planning for the common good. Such planning, democratic and socialist, is as essential to us as it is to other people. The plight of our own primary producers and of nearly
400,000	workers reported a day or two ago to be unemployed underlines the necessity of out taking a vital and direct interest in the making of such a plan. As I have stated several times, we believe that the proper solution of world economic problems is essential to the solution of the dangerous political problems which face the world at the present time. Even without a comprehensive international plan we should devise ways and means of protecting our own people from depressed farm prices and lack of remunerative employment. After all, settlement in the international sphere will, 1 readily admit, take time, but our domestic difficulties are immediate and require immediate and maybe short-term solutions.
I think everyone will admit that our Canadian economy is particularly vulnerable because of the manner in which it has evolved. Until recent years we were in the happy position, as the Prime Minister (Mr. St.

The Address-Mr. Coldu'ell Laurent) indicated in his remarks today, of being able to sell our surplus commodities in one area and buy most of the supplies that we needed in another area. Two world wars have changed this picture. That is the basis of what we are apt to call the' dollar problem. Some people say that henceforth we must sell more in the United States in order to obtain dollars to pay for imports from that country, and we should do this if we can. Unfortunately the main commodities upon which our farmers and certain other primary producers depend are competitive with the same commodities in the United States. The figures the Prime Minister used this afternoon confirm that it is upon agriculture and other primary products that the majority of our ,eople on the land, in rural towns and villages, in the distributing centres, and indeed in the industrial cities, depend. The lack of markets for these commodities will be reflected in general depression and unemployment everywhere in Canada. Already there is genuine alarm at accumulating surpluses due to shrinking markets for primary products, and of course the rising number of unemployed. The two things are related.
What do we suggest should be done to offset the difficulties that are arising? First, of course, steps must be taken by parliament to maintain and increase domestic consumption by planning for full employment and widely distributed purchasing power. Our best market is still our domestic market. At present we are told we have some 375,000 persons unemployed and seeking work. Yet what is the government offering to relieve this situation? An extension of unemployment insurance is the solution mentioned in the speech from the throne. That is a palliative. I agree it is a necessary one under certain circumstances, but surely in this country it is a confession of failure when there is so much to be done. Tonight we learned what has become of the public works shelf of which we heard so much in 1945, and which was recommended in the white paper dealing with post-war employment plans which I believe was placed before the house in that year. If we are to achieve full employment I say first that this country cannot possibly allow primary products to fall drastically in price. Consequently farm purchasing power will require the establishment of adequate floor prices based on parity with the goods farmers must buy. I submit that is of immediate concern not only to the government, but also to this parliament, and this parliament must grapple with it.
I imagine whatever we do now will be in the nature of expedients to meet a threatening crisis. Expedients are what we have usually adopted throughout the years. In the light of


a completely new world situation what we need and must have is a properly planned and comprehensive farm policy for this country, something we have never had. Such a policy should be formulated in conjunction with a national economic plan for the development of all our resources having in view the maintenance of full employment and improved standards of living for Canadians generally. I do not suppose that will be undertaken immediately, since agriculture may be faced with increasing difficulties at once. But at least an outline of a comprehensive plan for agriculture should be formulated. That should be the subject of a conference of representatives of farm organizations, provincial governments and the federal authorities. Therefore we urge that, while taking short-term steps to relieve the situation now, Canada should be formulating a long-term policy for this basic industry. Because the government failed to take effective steps to protect agriculture from the severe dislocation with which it is threatened, or to meet rising unemployment, I had intended to move an amendment in simple terms condemning the government for its failure in these two particulars. The official opposition has moved an amendment; but because some of the phraseology and some of the statements are not altogether acceptable to my colleagues and myself I am going to move an amendment to the amendment, seconded by the hon. member for Vancouver East (Mr. Maclnnis), as follows:
That the amendment be amended by deleting from subparagraph (2) thereof all the words after the word "inaugurate" and substituting instead thereof the words "an over-all social security program Including national health insurance and the removal of the means test from the old age pension"; and also by inserting in subparagraph (4) thereof, immediately after the word "measures," the words "to protect civil liberties and at the same time," and also by inserting, in the same subparagraph, immediately after the word "communists," the words "and fascists."
Standing by itself that is rather incomprehensible, so I shall read the amendment as it will appear if the subamendment is adopted:
We respectfully submit to Your Excellency that Your Excellency's advisers have:
(1)	failed to take adequate measures to preserve and expand markets for Canada's surplus products of farm, forest, sea and mine, and to deal with the problems of increasing unemployment and reduced income to Canadian farmers and other producers; and
(2)	failed to take steps to inaugurate an over-all social security program including national health insurance and the removal of the means test from the old age pension; and
(3)	deliberately violated a law of this parliament by illegally suppressing the report of the commissioner under the Combines Investigation Act on the flour mill industry for ten months, including the period of the recent general election campaign, and denied to parliament information essential to the performance of its duty and the maintenance of responsible government; and

The Address-Mr. Coldwell
(4)	failed to take adequate measures to protect civil liberties and at the same time curb espionage and other harmful activities of communists and fascists in Canada.
Through the years our best market for primary products has been the United Kingdom. They still badly need our foods. They can only buy from us if we make that possible by buying from them. As has been said already by the Prime Minister (Mr. St. Laurent), Canada cannot continue to make gifts to Great Britain. One of the barriers against the exchange of goods to which he referred this afternoon has been the Canadian tariff and other prohibitions and quotas. I hope the recent announcement of the removal of some of these quotas and prohibitions will result in an increase in Britain's supply of Canadian dollars, which will enable her to buy more Canadian goods. But we should give attention to the removal or lowering of tariffs against many classes of goods from the United Kingdom and the sterling area, even if this means temporarily discriminating against the same kind of goods coming from the United States.
Under present conditions we cannot expect to sell Britain two dollars' worth or more of goods and take in return only one dollar's worth from the United Kingdom. She cannot find the funds now, as she once did, to balance the account. Nor can we, under similar circumstances, buy two dollars' worth or more of goods from the United States and sell that country only one dollar's worth. Recent announcements from Washington indicate clearly that with the temporary exception of beef, malting barley, seeds and perhaps some fruits, the agricultural products we wish to market are surplus in that country, and there is no outlet for them there.
There is no doubt that many of the goods we import from the United States could be obtained just as well, and perhaps sometimes even better, from the United Kingdom. I do not mean to imply that there can be a complete or absolute balance between our two countries. It is improbable that this could happen. That being the case some other method must be found of meeting the immediate situation, and I want to deal with that point as briefly as I can.
We are suggesting that instead of demanding payment by the sterling area in dollars, it would help bridge the immediate gap if we accepted more goods and then part payment in sterling. This sterling could be used to buy some of the goods we shall need in future from Britain's ever-increasing production; but what is much more feasible and important, it could also be used for Canadian investment in the sterling area. In that way we would not be giving credit to Britain; we
would be establishing an asset somewhere else in the world. The countries of southeast Asia and the underdeveloped areas of Africa, controlled as they are by sterling area countries and particularly by the United Kingdom, are trying to build up and expand their economies. They need machinery of all kinds, and I can see no reason why Canada could not export to Britain foodstuffs and other commodities which we have in surplus supply to feed and house the British workers, who would produce many of the machines needed in the underdeveloped areas. Thus payment to Canada could be made in the form of capital investment in the underdeveloped areas. In this way each country could specialize in the kind of production for which it is best suited, and at the same time help build up the underdeveloped areas of the world.
In this way too we would assist the British people to obtain badly needed food and other supplies and at the same time assure Canadian producers of badly needed markets, at least in the immediate future, for the vast surpluses which otherwise will accumulate and become a burden on our economy. Not only will they be a burden on our economy; inevitably they will lead to drastic curtailment of purchasing power on our farms and unemployment in our cities. A plan of the kind we suggest-and we are suggesting it for the consideration of the government and of this house-would not only be beneficial to the Canadian economy but would secure for us the good will of old and new territories containing millions of potential customers for Canadian commodities.
The proposal we are making does not involve the accumulation of frozen sterling balances which one day Britain or other countries in the sterling area would have to redeem in dollars. If that were so the proposal, as the Prime Minister has said, would be unacceptable to the British. Last fall at the food and agriculture conference their spokesman, Mr. Harold Wilson, stated, according to his official text, that-
-the accumulation of large and growing amounts of inconvertible currency on the assumption that they would one day be made convertiblewas a policy which he could not accept. What we are suggesting is that sterling accepted as part payment for Canadian exports should be used for investment purposes in the sterling area, or in payment of goods to be delivered as production increases in Britain.
The point is often ignored in a discussion of this matter that every responsible economist whose opinions I have been able to read has underlined the importance of the flow of investment funds from North
70	HOUSE OF
The Address-Mr. Coldwell America to the sterling area and the territories controlled by the major sterling countries.


Alcide Côté: Would my
hon. friend permit a question?


Major James William Coldwell: I would prefer to continue
for the time being. Last September the Washington conference stressed the need for both public and private investments from the dollar area to the sterling area. Quite recently, at the meeting of the commonwealth foreign ministers in Ceylon, this phase of our commonwealth relationships I understand was again underlined. Indeed, in the very speech to which I have referred, that of Mr. Harold Wilson last September, the importance of international investment by North America, that is by Canada and the United States, was emphasized, in these words:
. . . since it is one of the most hopeful and speediest means of increasing the flow of scarce currencies into the rest of the world.
Hence the suggestion we are making in respect to sterling balances being used for investment purposes is strictly in line with these suggestions. Moreover, early this month a Canadian Press dispatch from London quoted a British treasury official to the effect that Britain would be prepared to extend her purchases in Canada if we could consider accepting sterling in payment.
The development of such arrangements of course would require agreement between us; but we are trying to suggest some basis of discussion to enable us to maintain those external economic relationships upon which I firmly believe the welfare and prosperity of our own country depend.
Let me make this clear. This is not a plea for aid to Britain. That must be an incidental consideration to a Canadian primarily interested in the welfare of his own country. I believe, however, that if a solution along these lines could be worked out it would be a measure which would be helpful to the British people and would assure Canadian primary producers of badly needed markets. One of the points I think I should make is that we are not suggesting that the purchase of United States goods should be denied to Canadians. We suggest nothing of the kind. We do suggest that our balance of payments to the United States is, under present world conditions, a burden which is difficult for Canada to bear.
We suggest, too, that there are some Canadian expenditures for United States products and services which could be curtailed without causing much hardship to the Canadian public. Canada's prosperity in the future, as in the past, depends, in our opinion, upon our ability


to trade as freely as we can with the rest of the world, and particularly with the sterling area including our best customer, the United Kingdom.
In so many respects our economy is competitive with that of the United States. In the same respects, it is complementary to that of the United Kingdom, and indeed of other countries in the sterling area. Apart altogether from sentiment, apart from the desirability of maintaining our commonwealth associations-and that is desirable-our material and economic interests lie in maintaining and expanding our economic relationships with the United Kingdom. To assure the maintenance, and indeed the expansion, of this vital economic relationship must be, I believe, a primary purpose of Canadian public policy.
I have therefore outlined at some length suggestions which we believe to be worthy of consideration and discussion. In conclusion, I should like to say this. Only by examining every possible channel can this country's producers, and the people dependent upon them, be protected from grave hardships, and of course that means practically all our people, because we are all dependent, more or less, on the prosperity of our primary producers.
How simple it would be if nations could exchange goods freely, and settle their balances in a universally accepted currency under an international economic plan. Of course, one realizes that that plan would involve the exchange of goods, which alone make any currency acceptable at any time. How simple it would be if we could pay our debts to the United States in pounds sterling. But since the United States demands dollars, and her own dollars, instead of goods or sterling from Canada, the United Kingdom, and indeed all countries, we must devise other ways and means of maintaining farm prosperity and full employment.
These are two problems that are really one problem and one which, obscured by the war and post-war demands, including Marshall aid, is again casting its shadow across this country from one ocean to the other. So, Mr. Speaker, I hope that during this session we shall give every attention to the wider international matters, both economic and political, that we shall try to solve the problems that face our own farmers and workers in the form of depressed prices and unemployment, and that we shall find policies that will assist this country to go forward, prosperous and free.


Alcide Côté: May I now
ask my question? After listening to my hon. friend, and on the eve of a general election in England, may I ask my hon. friend whether he would be in favour of something he has not mentioned as yet: that is, everything being

The Address-Mr. Low
equal in England and this country, would he suggest that the shares of the Canadian Pacific-


Mr. Ferguson:: How about the crown jewels? They don't need them.


Alcide Côté: Just let me finish. Would the hon. member be in favour of repatriating the shares of the Canadian Pacific?


Major James William Coldwell: I think the answer to that question can be found in a speech I made some years ago, and which appears in Hansard. I advocated bringing back all Canadian securities to Canada in payment of loans that were made some years ago. In the interim, however, I believe that many of the Canadian Pacific securities have found their way into the United States, and are not now available to us.


Mr. Solon E. Low (Peace River):: Mr. Speaker, before entering upon a discussion of His Excellency's speech, there are three pleasant tasks that I should like to perform. I wish first to offer my congratulations to the mover (Mr. Larson) and the seconder (Mr. Dumas) of the address, upon their tempered and very eloquent addresses. Second, it is my desire to congratulate the Prime Minister (Mr. St. Laurent) upon what I thought was a most skilful and creditable job in presiding over the recent dominion-provincial conference, which I had the privilege of attending as an onlooker. In my judgment, the success of that conference was, to a very great measure, due to the way in which the Prime Minister handled the chairmanship, and steered the provincial delegations along their course with finesse and quite obvious sincerity. Let us hope, then, that the work so well begun by that conference can be carried to an early and successful conclusion.
Third, may I tender my congratulations to the hon. member for Grey-Bruce (Mr. Harris) upon his appointment to an important post in the government. Mr. Harris was a popular choice for the new Department of Immigration and Citizenship. If he gets the support that he should get from his cabinet colleagues, I feel quite confident that this long-neglected orphan department will receive the type of leadership it has deserved for many years. Immigration has long been kicked around, and has been left without anything that could remotely resemble a policy. The people of this country from coast to coast are now expecting something different, something in the way of an announcement of a definite design that will make it possible for the officials of that department to know what to
do with the thousands of cases that have had to remain suspended for lack of specific direction from the government.
Now, Mr. Speaker, from a study of His Excellency's speech one receives the impression that the government thinks it has made quite elaborate provision for Canada's security. A close examination of the terms of the speech reveals that considerable emphasis has been placed on our external security, our relationship with the other countries of the world. But there are plain indications of serious neglect of many of those things which do constitute our internal security.
I cannot deal with all of them tonight in the limited time at my disposal, but I do intend to deal with three or four examples of that lack of consideration. In the course of the last session in the fall of 1949, there was such universal recognition of the need for federal aid to education, and indeed such widespread demand for it that the people of Canada felt justified in expecting that something would be done about it this year, that some provision would be made. In my estimation such a thing would be important enough to warrant mention in the speech from the throne. I can, however, find no reference whatever to it there; and I feel let down as I am sure a good many thousands of other Canadians will feel let down because they have found in the speech from the throne no reference to federal aid for education.
Nothing can contribute more to the internal security of our country than a broad understanding on the part of its citizens. If a democracy is to work properly and yield the results which the people want from the management of their affairs, there must be a high general level of educational achievement amongst the people. In a country as large as Canada, with such widely varying resources and productive possibilities, there are bound to be areas of much lower incomes than others. One can find almost every degree of prosperity amongst our provinces and municipalities. As a result, and also because we have got into the habit of raising the bulk of educational costs from taxes on real property, there is a wide divergence of educational opportunity for Canadian girls and boys. Enough facts and figures were put on Hansard in the 1949 fall session to convince anybody that this is so. For that reason I do not require at this time to repeat what was impressed upon us in that respect during the last session. As Canadians our aim should be equality of educational opportunities for all our people. Boys and girls who live in rural areas should not have less opportunity to develop, grow and mature than have their fellows in the cities and towns. The residents

The Address-Mr. Low of those districts where production is usually low and incomes therefore small should not have lesser opportunities to become good and useful citizens because of lack of education and training. We must realize the need for some equalization of opportunities. We must also recognize the danger of continuing to take seventy per cent or more of the cost of education out of taxes imposed upon the farms and homes of the people.
We cannot possibly achieve equality of educational opportunity across Canada without definite and substantial federal aid. I could talk for some time about the teacher situation and the need for higher salaries to attract and hold the best teaching material. I could talk at length about the need for higher qualifications on the part of teachers and for better equipment in the schools; but of course the government would probably accuse me of advocating the spending of moneys from the federal treasury while at the same time seeking tax reductions. With the high cost of defence during these uncertain and fearful times, with fixed government costs running at the highest level in our whole history, I know that the government is going to find it exceedingly difficult to balance its budget. But I charge that the government has failed to do anything like what it is perfectly possible to do, or to use its imagination. Otherwise it would easily have seen that aids to education could have been provided this year without in any way impairing the financial or economic soundness of our country.
One of the most pressing educational needs of this day is for proper school plants and capital equipment. There are, unfortunately, still many hundreds of school districts and divisions in Canada that are forced to carry on with obsolete and rundown buildings and equipment utterly unfit to be used for the purpose of education. There was a time when school district debentures were considered to be a good investment and they were rated amongst trustee securities, but in a great many areas in Canada they are no longer considered to be trustee securities. Most of the school districts therefore must finance building and capital equipment out of current revenue. This situation puts a severe strain on the taxpayers as well as a short limit on the salaries that can be paid and the educational services that can be given. As a result, education languishes in many parts of our country. The sad part of it is that it does not need to languish. We have in Canada plenty of building materials and a sufficient amount of labour to do the building. If the federal government would give some help to
fMr. Low.]
the provinces to meet the terrific need for new buildings they would be rendering a real service to general education in this country.
I suggest there are several practical ways by which this aid can be advanced without having to dip into the treasury. The first one is this. In the late thirties an act called the Municipal Improvements Assistance Act was passed through this house. It provided for loans to municipalities and school divisions for self-liquidating projects, at a low rate of interest, namely two per cent, and covering up to twenty years in time. The loans were guaranteed successively by the municipalities, the provincial authorities and the federal government. To my knowledge and in my experience this act worked well until loans under it were suspended as the war situation became more intense. I suggest that the act be taken out of the mothballs, and that the federal government make some contribution to the welfare of education in the provinces by resuming the loans for self-liquidating projects under that act. Certainly school plants and improvements could be classed as self-liquidating projects to qualify for such loans.
Another way by which aid could be advanced is this. In certain provinces, notably Saskatchewan and Alberta, it would be possible for the federal government to give substantial aid to the cause of education by agreeing to release all or substantial portions of the school lands trust moneys for the purpose of setting up a capital loan fund from which school districts could borrow at low rates of interest in order to provide new school accommodations that are so urgently needed in those two provinces. The Alberta fund, which is administered under this government, now amounts to more than $12 million. It is invested in dominion securities, the income from which is supposed to be paid over to the province for educational purposes. Since the cost of education has grown to such large proportions, I can see no logical reason why the provinces and the dominion should not revise the school lands trust fund agreements so as to make available the substantial moneys as a revolving loan fund for capital purposes in the field of education. I urge the federal government to give sympathetic consideration to this proposal and even to go so far as to find out if the provincial governments that are concerned, notably Saskatchewan and Alberta, would be ready to revise those agreements.
There is a third way by which federal aid could be extended to education. Many school divisional and district boards, especially in rural areas, are making commendable efforts

to provide better educational facilities through setting up centralized schools. It becomes necessary for them to buy vans and school busses to convey the pupils to those .centralized schools. Such purchases are increasing in number year by year, but the federal government continues to impose sales and excise taxes on these vehicles; this action puts a heavy penalty on the educational facilities that are to be provided. Here then, I say, is a place where the government can do something for education; and I urge that at this session there be brought in an amendment to the various excise and taxation acts providing that the purchase of busses and vans by school boards be made tax free. Surely, Mr. Speaker, if we are not prepared to make grants in aid for education, we can at least get off the backs of the school districts; and here is a good chance to do it.
There is a fourth way of course. This one would involve some moneys out of the treasury. The best way to help the provinces to carry their educational burdens would be by grants-in-aid on a weighted basis to favour the poorer localities. Surely, a country as wealthy as ours should not find it too difficult to provide some money for this purpose. No argument to the contrary can possibly be valid as long as Canadians spend hundreds of millions of dollars on intoxicating liquors and other things with which we are trying to destroy ourselves.
The Social Credit Association of Canada declares that no financial consideration should be allowed to stand between any worthy Canadian boy or girl and the utmost in educational attainment he wants and is prepared to achieve and is capable of achieving.
Closely related to this whole business of federal aid to education is the problem of public relations. During the past two years this government has made a wretched failure of its part in the democratic process. I agree with what the leader of the opposition (Mr. Drew) said this afternoon in this respect. The government has failed to keep the electors informed about the facts of the situations that have developed. Somehow or other the ministers of the crown have come to feel that there is no obligation on their part to keep the electors informed about the real facts of trade, agriculture, unemployment, and the many other things that do develop from time to time. These things affect the lives of the people most materially. A good many people now feel that the government has not only failed to keep them informed about things they are entitled to know but that various ministers at various times have actually misled them and tried to lull them into a sense of false security.
The 'Address-Mr. Low
All during the general election of last June and during the fall session of 1949 government spokesmen contended that all was well with Canadian trade and agriculture. The fact is that we faced at these very times a serious trade crisis which kicked back on our farmers as well as on some of our manufacturing industries, so that they too now face a serious crisis. We only have to recall the press reports for the months of December and January last to know how Canadian farmers feel. In many of their forums and conventions they were actually advocating production strikes in protest against conditions imposed upon them as a result of this government's bungling and vacillating policies. Thousands of farmers feel that the government is now trying to crawl out from under their responsibilities. During the period from 1942 to 1948 the Liberal government imposed certain policies upon our farmers under which the latter had to accept much less for their products than they would have received if those policies had not been imposed upon them. The Minister of Agriculture (Mr. Gardiner) has said so himself. The farmers did not complain because they were given to understand that these policies were part of a long-range stabilization program. Now the farmers are beginning to realize that Liberal talk and promise were unadulterated anaesthesia. There is general restlessness amongst them because they cannot now see any possibility of realizing the stabilized prices the government promised them. It will certainly be a serious breach of faith if this government of Canada does not keep its promise to provide stabilization for agriculture.
I wish to repeat, there is restlessness amongst Canadian farmers and many of our smaller manufacturers. Why is it?
This government has complicated and further confused Canada's already serious trade and agricultural problems, and has put us in that position where the possibility of depression stares us in the face, by refusing to face up to realities and to take independent action based upon the facts of the situation. Let me repeat that-by their refusal to take independent action based upon the realities of the situation. How can this fail to affect our security? As an example, the government has steadfastly refused to accept non-convertible sterling in payment for those foods and other things which Britain did not have the dollars to buy. I quite agree with the hon. member for Rosetown-Biggar (Mr. Coldwell) that right from the beginning we should have attempted to preserve our traditional markets in Britain and in Europe by accepting sterling for these balances for which the British and other markets in Europe could not find dollars.

The Address-Mr.'Low
Canada could have used blocked sterling to shop around the sterling area for goods we need and can use. This is not to say that we should neglect the full development of the United States market or, for that matter, any other possible market for Canadian goods. But the fact remains that we have lost a substantial part of our traditional British and European markets which we could very well have kept, and it is going to be most difficult to get it back.
Some critics of this proposal say that Britain is not willing to buy Canadian goods with non-convertible sterling. Recently food minister Strachey made it quite clear that he was ready to buy more Canadian and United States produce if we would buy more from the sterling area. In his recent interview with Reynolds News Mr. Strachey's statements indicate quite clearly that Britain would be glad to buy more Canadian foods and other things if we would accept the only :orm of currency they have got, namely, nonconvertible sterling, which could be exchanged for goods at any time in the future.
The Minister of Agriculture and his colleagues have not given support to the proposal for an international commodity clearing house for disposing of surpluses which could not be sold for convertible currency in world markets. As a matter of fact the minister has discouraged it. Here is one international organization which really offers some good and effective results. But whereas, since the war ended, the Canadian government has blindly plunged into all other proposed international organizations, some of which have proved to be merely interesting pastimes, they now say through some of their ministers, notably the Minister of Agriculture, "This problem of marketing surpluses is one which can be best taken care of by each country by itself." If that is the case why have not they been doing it? The international federation of agricultural producers' committee, which met last autumn to consider the international commodity clearing house proposals, reported in October in these words:
The problem of surpluses can be tackled by operations that bring together marginal supplies and marginal needs, and normal trade can continue unimpeded and even strengthened by such operations.
The committee then proposed the international commodity clearing house which provides a world pool of surpluses from which the countries of the world can make purchases using their own currencies. This is along the line of the international pool of such surpluses that we Social Crediters have been advocating for several years.
It is true that the food and agriculture organization committee, at its meeting held in Washington in November and December

last, temporarily turned down the international commodity clearing house proposal. But it is noteworthy that the conference was guided to its decision by the financial advisers of the international monetary fund and the international bank for reconstruction who were present. These world financial organizations thus indicated their determination to prevent the distribution of commodity surpluses on a mutually satisfactory basis of exchange of goods for goods, or of goods for non-convertible currency, which amounts to the same thing. Evidently they insist on forcing all exchanges of goods to continue on a basis of convertible currency through financial channels which they themselves control. Everybody knows that the Bretton Woods proposal for a convertible currency pool of the world is a fool's dream of paradise under present circumstances, and will continue to be until such time as the great creditor nations like the United States and Canada are prepared to buy, in the markets of the world, goods in dollar volume equal to the goods they sell to the world. Of course Canada has become a comfort to their plans, the plans of these internationalists to control the exchanges of the world, by her failure to give support to the international commodity clearing house proposal.
I will say this, that until such time as some such idea as the ICCH-the international commodity clearing house-is adopted, Canada will find plenty of difficulty in disposing of unsalable surplus foods and other things which are now beginning to appear. It will be a sad reflection upon the intelligence of responsible officials of government if we ever begin the wholesale destruction of food products, or the restriction of their production, so long as there are on the earth people who need those things to keep them living in a state of health and happiness.
Dr. Kenneth Galbraith, professor of economics at Harvard university, and guest speaker at a recent conference of the Canadian Federation of Agriculture at Niagara Falls, stated he doubted if Canada and the United States will be able to expand, to any great degree, the flow of agricultural products abroad, because most European nations are striving hard toward self-sufficiency. Already they have made great strides in that direction.
Professor Galbraith declared that Canada and the United States must take a large share of the blame for that situation, and for two reasons: First, we priced ourselves out of the European market, and, secondly, we failed to provide the machinery by which Europe might be able to buy our products. Professor Galbraith further stated at Niagara Falls that, before we are justified in asking

Europe to put an end to their policy of selfsufficiency, Canada and the United States must do a number of things among which are these. First, we must assure Europe of the means by which she will be able to buy our goods after Marshall aid ends in 1952. If convertible sterling is not available, then we will have to accept non-convertible sterling.
Then, secondly, we must remove and reduce certain tariff barriers. At the present time agriculture in Canada is taking the rap for what the secondary industries have done. Secondary industries have maintained excessively high prices which, in turn, increased farm costs. Our government must share the blame for the fact that these barriers have been allowed to exist and To continue. The government must know that the inevitable consequence _would be that we would price our farm products completely out of the European markets.
The third point made by Professor Galbraith is that some program to expand the internal consumption of farm products must be adopted both here and in the United States. We contend-and I am speaking of the Social Credit Association of Canada- that the best program for bringing about this expansion would be one based upon the social credit compensated price-discount mechanism. This would be especially valuable and effective when applied to those surplus products where just a slight increase in per capita consumption would cause the surplus to disappear entirely. Let me give an example:	If each Canadian were to consume
just one more egg per week than he or she is now consuming, they would use up an additional 60 million dozen eggs this year, and the poultry producers would not have to worry about surplus eggs. But the Canadian people have to be able to buy those additional eggs if such a happy condition is to be made possible. Our proposal assures them the purchasing power.
The social credit compensated price-discount mechanism will do more to extend the internal consumption of farm products than any other mechanism now known, and it is worthy, I suggest, of the closest study in connection with the problem posed by Professor Galbraith.
The fourth suggestion made by Professor Galbraith, along with the three I have already mentioned, is this one, that for the present at least some form of two-price system will have to be adopted by which Europe can be allowed to buy our goods at a lower price than the existing internal price level, and this notwithstanding Geneva.
The Address-Mr. Low
The implications are clear. We will have to adopt some system of seeing to it that our farmers have an internal price based upon parity with the cost of goods they have to buy; and secondly, we will have to see .to it that exporters are compensated for any loss they may take by selling their goods or farm products, particularly in European markets, at a lower price than they can be sold internally.
I wonder if this government has independence and imagination enough to take the action required to meet the situation? The speech from the throne does say that the Agricultural Prices Support Act will be brought before the House of Commons for amendment, so that it' can be continued. There is no indication, however, whether it is the intention of the government to make the act' permanent; nor can we take much comfort from the declaration in His Excellency's address until we see what kind of bill it is going to be.
We fervently hope it will not be a mutilated shadow of a thing, another attempt' at window-dressing. Canadian agriculture must be kept prosperous. If that is assured, then all other elements of Canadian life can be kept prosperous.
For a moment I should like to turn to the consideration of a fourth matter of great importance to Canada's future internal security. I have in mind the prospects for continuing high employment and prosperity. The speech from the throne says this:
* Employment and prosperity remain at a high level in Canada. The prospects are good for continued private investment in construction and capital development throughout the present year.
Then follow some statement's about unemployment and unemployment insurance which not only cast some doubt on the optimism expressed in the part I quoted, but also serve to mislead the people. Actually, and just to review what has already been said for the purpose of what I wish to say in this connection, as of February 2 it is indicated that ten and four-tenths per cent of the total number of Canadian wage earners were out of work. The consequent strain upon the unemployment insurance fund is very heavy. I wish to emphasize however that the more serious aspect' of the situation is the feeling of restlessness spreading among the people who cannot help remembering the sequence of events which led up to the hungry thirties.
They see in the present combined situation too close a parallel to feel anything but grave concern about the future. I remember well that in 1929 very optimistic declarations were being made about the future, exactly as they were made today by the Prime Minister (Mr. 55946-6;

The Address-Mr. Low St. Laurent). Let me say here a word about the Prime Minister's speech delivered this afternoon. First let me compliment him, especially upon that part of his speech in which he dealt with the state of the nation. I compliment him particularly for demonstrating that he can face facts-for he was doing it pretty well this afternoon. I think his forecast for 1950 was most reassuring, especially when he mentioned, as I believe he did, that the anticipated investment in new developments for 1950 was estimated at 22 per cent of the gross national production-a figure which is much higher than that of last year.
This is remarkable, and we fervently hope that it comes to pass exactly as anticipated. But let me point out that the investments he mentioned will be made only if there is confidence that the production resulting from them can be sold. I would point out to the Prime Minister that a very large part of the $16 billion of gross production is still financed through production loans obtained from the chartered banks by acceptable borrowers. Moreover, the proceeds of these loans filter through long chains of transactions, to become the purchasing power with which consumers must buy the food, clothing and shelter they require. If anything should interfere with this flow of consumer purchasing power as, for example, curtailment of production loans by the chartered banks, and perhaps calling in old demand loans for repayment, then very quickly the whole outlook as presented to us this afternoon by the Prime Minister (Mr. St. Laurent) could be changed. Such a thir^g could happen again as happened in the years 1930 to 1933. During that period the chartered banks withdrew and cancelled out of existence $932 million of purchasing power in the manner I have indicated. We all know of the disastrous results in those years and the years following. That power still rests with the chartered banks, and I see nothing to prevent the shrinkage of substantial portions of consumer purchasing power if the banks should again begin to feel that their usual customer borrowers could not repay their loans within the usual short-loan term. Thousands more people now know that fact than ever did before. Therefore, as markets abroad are lost, as primary production prices begin to skid, and as even as little as 10-4 per cent of Canada's labour force begins to find itself unemployed, it is only natural that considerable restlessness would be evident amongst people who have experienced a few of the difficult periods of the past.
There is a way by which the government can reassure the people and thus keep up the confidence on which the prosperity of the future must be based. It will not help to tell

the people of Canada that we will continue sending more goods abroad than we bring back in trade. The use of a foreign investment program to balance trade is no longterm solution. I disagree strongly with my hon. friend from Rosetown-Biggar (Mr. Coldwell) when he advocates that such a course be taken. It is a palliative for the immediate years ahead. It may be used successfully for a short time in an effort to give help to certain countries of Europe and southeastern Asia that require our help, but it is no long-term solution. We would be opposed to its introduction as a long-term solution. All we have to do is to look at the situation in the United States today to be frightened away from it. That is what the United States of America has been doing for a good many years, and that is why they find it impossible today, because of the flow of interest from these investments, to buy as much from the other countries of the world-and therefore balance their payments with the rest of the world-as they export in goods and services to them.
The use of a foreign investment program therefore does not offer any long-term solution, but what would be really effective would be a positive declaration by the government that they will revise the laws and practices governing financial policy so as to definitely assure the people that never again will they allow wanted goods and services to be destroyed or remain unproduced or unsold from lack of effective purchasing power in the hands of Canadian consumers. When that positive kind of assurance is given to the Canadian people, there will inspire them a confidence in the future that will make Canada the greatest and happiest country in the world.
I read with some interest just the other day an editorial on the front page of the Financial Post for February 18 under the caption, "Let's not be panicked by the gloomsters." I presume that was what the leader of the opposition (Mr. Drew) was referring to this afternoon, and I commend him for the strong terms that he used. I will use some a little stronger. There was some pretty good sense in the editorial, but there was also some stupid nonsense such as this sentence, for example:
The socialists and the little clutch of Social Crediters are, of course, intent upon destroying the economic system.
I cannot speak for the socialists-they will speak for themselves-but I can for the little clutch of Social Crediters, as these apologists and pundits of high finance call us. There is an old trick which the guilty have used since time began. When their nefarious practices

are about to be exposed they resort to accusations against others to try to divert attention from themselves. I wonder who it is who is intent upon destroying the economic system? Who is it that has caused society to suffer through twenty-three depressions in the past 100 years?


Mr. Maclnnis:: The operators of the system.


Solon Earl Low: Surely they cannot blame the little clutch of Social Crediters for we have only been in existence as an organization for the past fifteen years. These same false accusers used to try to make people believe such foolish things as this, that the business cycles of boom and bust were somehow linked with the seven-year cycles of return of sun spots. I think a good many of you remember that was taught.


Donald MacInnis: A good many still believe it.


Solon Earl Low: Yes, that is the unfortunate part of it. For many years these same people have carefully hidden the facts from the general run of the citizens of the country. We now know that depressions arise as the result of deliberate policies conceived and imposed upon governments by these same Shylocks who are the sole beneficiaries of the system, and who are after their pound of flesh, no matter how many people suffer in the process. Certain it is that the Financial Post, their subservients and associates, and their predecessors, have already destroyed the economic system by their insistence upon retaining as a part of it those stupid and unrealistic practices that ensure that every seven years we have to throw men out of work under a deliberate policy of unemployment, destroy huge quantities of our precious production, bring on a first-class depression, force countless thousands of our people to live in poverty in the midst of abundance; and finally bring on a war and start the whole cycle over again. I say, let them show their good faith by bringing forward some effective proposals to cure our economic ills. When they do they may have some room to talk.
What Social Crediters are trying to do is to remove the abuses of the so-called free enterprise system so that it can be given a chance to demonstrate its superiority over any other system in the world, and it can. Just get these old men-of-the-sea off its back, and one of them is the Financial Post. Social Credit thinks of full enjoyment. We do not lay the stress on full employment, but we do declare that not one single willing worker should be idle if he wants to work. We claim that as long as there is demand for them anywhere in the world, no goods possible of production should go unproduced. If we ever come to the point where overproduction really threat-
The Address-Mr. Applewhaite ens, then cut down the hours of work and see to it that there is a fair distribution of the leisure time possible, without reducing the take-home pay of the workers. There never has been a sound proposal, except from Social Crediters, whereby these things can be accomplished in our Canadian economy.
We are not "gloomsters". No one has more faith than Social Crediters in the future of our great country, and in its ability to yield abundance and happiness to its people. No one works harder than we do to preserve the good things in our private enterprise economic system. There will be no question in our minds about a brilliant and secure future for Canada and the world if the government of this country will assert its independence of the control of the people who subscribe to some of the policies held dear by the Financial Post.
Kick them body and breeches out of the driver's seat; make a few fundamental changes in financial policy; take a sensible attitude towards trade and the other factors of internal security I have mentioned; let the government settle down to do what it was originally designed to do, that is, make its most important task the removal of all those barriers and artificial restrictions which prevent individual Canadians from achieving by their own efforts security for themselves and their families. Do these things and the private enterprise economic system will successfully weather the stresses and strains of the days and events that are to come.
I hope I have thrown out some suggestions, Mr. Speaker, and made some sort of positive contribution to this debate. If I have, and if those things are seriously considered, I certainly will not feel that my time has been wasted.


Mr. E. T. Applewhaite (Skeena):: Mr. Speaker, it is a real pleasure for one representing my constituency to take part in this debate on the address, because to all intents and purposes the adoption of the address is a vote of confidence in this government. This is the first time I have participated in a debate of this nature, and I find it not only a pleasure but also a natural duty to support anything in the nature of a vote of confidence in this government. Having just returned from my constituency there is one thing of which I am very certain; that is, that this government has the confidence of the country.
I returned from the west prouder than ever of Canada and of Canada's government. I found that our leader, the right hon. Prime Minister (Mr. St. Laurent) has captured the respect, the esteem, the affection and the confidence of at least my part of British Columbia to an extent I think never before equalled by any other prime minister. I
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The Address-Mr. Applewhaite hope in some small way to contribute to a continuation of that confidence, but I remind the government that such a continuation will depend to a large extent on their continuing to deal with the many local problems of the Skeena district, as well as the problems of the country as a whole, in an intelligent, sympathetic and encouraging manner. As far as our local problems are concerned, I propose to assist the government in dealing with them in that way; and further, as best I may, to insist upon their being dealt with as I know they deserve to be.
Before proceeding further may I offer my humble congratulations to the mover and seconder of the resolution we are now debating. Their constituents will read with real pride the many favourable comments their speeches have evoked. While I may be laying myself open to the charge of painting the lily, I should like also to thank and commend the right hon. Prime Minister on the fair, full, frank and comprehensive review he gave us this afternoon and evening.
Now, Mr. Speaker, without apology or hesitation I propose to take advantage of the time-honoured custom of using this debate as an opportunity to tell this house a little about the district I am trying to represent. The Skeena district of British Columbia is an empire in itself. I am not going to compare its size with that of some provinces or countries, but if I were to do so the comparison might be surprising. Skeena extends over nine degrees of latitude, from 51 north to 60 north. At a rough estimate it covers about 164,000 square miles, and I believe is the second largest dominion electoral district. Incidentally, this would not be such a difficult district for its member to cover if he could go so far and say, "From here on there are no residents, so I need go no further". It just happens that there are settlements in the remotest corners of the district; Lower Post in the extreme northeast, Bennett on the White Pass and Yukon railway on the extreme northwest; Allison Harbour on the very southern tip, the Queen Charlotte islands on the west and Endako on the eastern border.
That is not only a very large district; it is one of increasing importance to the country. Ours is one of the finest mineral areas in Canada, still barely scratched yet, with a marvellous record of production to our credit. We have one of Canada's major fishing industries which has contributed greatly to the world's food supply for many years. Our timber resources are extensive; not only do we supply many parts of the world with lumber and poles, we are also the source of supply for at least two of Canada's major


paper mills. Agriculture in Skeena is a small industry compared with some other parts of Canada, yet it is still an important factor in our economic life. We are now becoming the scene of industrial activity. Many hon. members know of the hydroelectric potentialities of the Skeena district which at this moment are of real interest to some of the world's leading industries.
It is lack of time, not of material, that causes me to end the list there. In my constituency is the famous little gold mining town of Atlin, and the lake and district of the same name. Early in 1898 Fritz Miller, a German, and Kenneth McLaren, a Canadian, left the Klondyke trail at Bennett and travelled on the ice across Taku Arm and Atlin lake. I am much more interested in the present and future-the immediate future- of this district than in its past, but there is always a certain amount of interest in the origin and discovery of new districts. The discovery of gold in the Atlin country by Miller and McLaren resulted in an influx of between five and ten thousand miners and tenderfeet; and from that day to this gold seeking and gold recovering in that district have never entirely ceased. Even today Transcontinental Resources and others are operating on a large scale. Atlin has a great deal of production ahead of it yet. Atlin is also a beauty spot; a district not unlike the Kootenays, with a series of lakes running north and south, it provides a spot of scenic beauty unexcelled anywhere in the world. Even the hon. member for Kootenay West (Mr. Herridge) would admit that were he to visit Atlin.
This government is to be highly commended for the part it played, together with the provincial government, in building a road from the Alcan highway into Atlin last year. Atlin will become a mecca for the wise angler and big game hunter. I sincerely hope the time is very near when the government will see fit to reopen the customs port of entry for aeroplanes there. The lake is the largest and most beautiful in British Columbia. Given the publicity and the transportation it deserves, the Atlin area may well become the most important tourist and recreation centre in western Canada.
Among the many outstanding attractions of the Skeena district is its large number of lakes, large and small. The names of some of them may be familiar to


some hon. members:: Babine, Takla, Francois, Ootsa and literally hundreds of others. These lakes lie mainly due north from Tweedsmuir park, and centre on one of the grandest fishing and hunting districts imaginable, covering thousands of square miles. As might be expected

of an extensive area still sufficiently virgin to provide so much game, the district numbers among its population many North American Indians.
That brings me to a subject which really justifies a full forty-minute speech in itself -in fact, I might make one. In the meantime, I should like to say a word about our Indian population. These people are people, Mr. Speaker, just as you and I. They are citizens of Canada. They are not only worthy of the interest and concern of this house, they are the responsibility of this house. It is a responsibility we must face up to. To what extent they are today inferior citizens, to that extent I am afraid we are largely to blame. Some betterments must, of course, take time; others can be speedily made. For instance, we have in many places native Indian villages which are headquarters for quite large bands. Some of these villages are remote and fairly expensive to reach. Nevertheless, I submit we should see that they are supplied with the same facilities with which we would supply white settlements of perhaps smaller population.
In this connection, the Post Office Department could be of tremendous help. Here, I should like to express my gratitude for and appreciation of the recently opened post office at Fort Babine, which will prove a real boon to many. But such other villages as Kitkatla and Kispiox and Kitimaat and so on, also justify such service. This is one very small way in which we can assist our Indian citizens to become a more integral part of Canada. I hope that the department and the house will continue to see that the advantages of better and improved services are given to the Indian villages.
I have a resolution from the northern district native brotherhood of British Columbia urging, among other things, the immediate consideration of the revision of the Indian Act. I note with pleasure, as they will, that this matter is to come before us at this session. I trust that it will come before us early, so we may give it ample study.
There is only one incorporated city in my whole district and that is the city of Prince Rupert. Built as the terminus, not a terminus but the terminus of the Grand Trunk Pacific, Prince Rupert, through a combination of circumstances entirely beyond local control, has lived through thirty years of depression, disappointment and frustration, to emerge in the recent war as one of British Columbia's most important cities. Originally visioned as a port for transpacific shipping, Prince Rupert now finds itself achieving its destiny along other lines. It has always had
The Address-Mr. Applewhaite a large fishing industry. It is the halibut capital of the world. More halibut is landed at Prince Rupert than anywhere else on the globe. I hope that fishing will always continue to be a major factor in Prince Rupert's economy. Fishing deserves, as it is getting under the present Minister of Fisheries (Mr. Mayhew), the attention and consideration which is due a major industry. My hon. friends from Newfoundland will agree with that.
Two large organizations, I regret to admit that neither of them was originally Canadian, have now realized and acted upon the strategic value of Prince Rupert's location. First, the United States government in the recent war chose Prince Rupert as one of its chief Pacific ports. That activity, of course, is over now. Second, the Celanese Corporation of America, through its Canadian subsidiary, Columbia Cellulose Limited, saw the true picture of a combination of Prince Rupert's location and the resources of the district. They have under construction an immense pulp plant which will provide payrolls and industrial activity in perpetuity.
Prince Rupert, by geography, is the logical supply port for Alaska. I sincerely trust that this government will continue to work along all possible lines to ease all restrictions on international trade, and thus encourage our American friends to do likewise. In this way, Prince Rupert and other Canadian ports may take their logical place in the Alaskan trade. Nothing can stop Prince Rupert's forward march, but governmental help can easily speed it up.
There is just one other section of my district which I wish to mention specifically, the Portland canal-Alice Arm district. This is one of the best known mineral producing areas in British Columbia. The old Granby Consolidated copper mine at Anyox produced a gross value of close to $96 million. The famous Premier mine at Premier near Stewart, British Columbia, has to date a gross production value of $75 million. At Alice Arm, Torbit Silver Mines are today in regular production of silver which, incidentally, is all going to the photographic industry in the United States, thus materially helping our dollar situation. The little mining town of Stewart, a most picturesque spot, situated at the head of the Portland canal right on the Alaskan border, is the centre of a mineralized area whose potentialities I predict will still not be fully known one hundred years from now.
I was up there the other day, and I saw some of the electrum they are now shipping from that place. I saw some ore recently shipped from Tide lake, which is about 25

The Address-Mr. Applewhaite miles from Stewart, from a property owned by one A. L. Phillips. This was a small shipment and it assayed 1,896 ounces of gold and 2,386 ounces of silver per ton. A small shipment which weighed 40 pounds netted after smelter costs $1,306. Mr. Speaker, I am not claiming that these values are usual but they do indicate that the mineral is there. At Tide lake this winter, ore is being mined which is so valuable they can afford to fly it from Tide lake to Stewart by chartered planes equipped with skis.
When the real Alaska highway is built up the western route from Hazelton to Whitehorse and that district has land connections with the rest of Canada, there will be more wealth produced from "them thar hills" than has as yet been dreamed of. When that happens, Stewart will take its logical place as another important north Pacific port.
I should like to turn my attention for a few moments, Mr. Speaker, from the physical aspects of the district to the reactions which we may expect from the people I represent to the speech from the throne. The people of Skeena, and I think I am capable of speaking for them, will welcome and receive a lot of comfort from this speech from the throne. My people happen to take quite an interest and a deep concern in matters of more than purely local interest. We are naturally interested in the outcome of the dominion-provincial conference because we realize that the final solution of many problems which are worrying us today must depend first upon some working formula between dominion and provincial governments. The people of Skeena riding, therefore, will welcome those words in the speech from the throne:
This conference marked a promising beginning in working out a satisfactory procedure-
And again:
Agreement was reached on certain general principles and a continuing committee was established to further the work of the conference.
I do not think it would be letting any secrets out to say that we rather feared for the future of the conference. We are now extremely happy to know that it is working, and working as well as might be expected.
It would not be the truth, Mr. Speaker, if I were to claim that the people of my district are happy about the international situation with regard to the security angle. It is not surprising that the district which borders upon Alaska and the north Pacific ocean, and upon what is advertised in so many sensational and not so sensational magazine articles as the highroad between Russia and the United States, should be somewhat worried. They will therefore welcome the evidence in the speech from the throne that this government


is conversant with the necessity of doing two things at once, of taking every possible step to prevent threats of aggression and yet at the same time taking the necessary steps to do what we can to avert that aggression should it take place.
I wish to read from the speech from the throne certain words which will be of great comfort to the people of my district:
. . . our country continues to give full support to the charter of the United Nations.
Again:
The cold war nevertheless still continues and imposes on all the free nations heavy burdens for the provision of defence forces and modem armaments. Preparedness to meet any sudden onslaught is essential and the means must be provided.
And again:
In the development of Canada's defence forces, constant attention is being given to the best use of our resources, to the encouragement of joint research and experimental development and to the co-ordination of Canadian efforts with those of the other signatories of the North Atlantic treaty.
It would be surprising, Mr. Speaker, if the people of a riding situated where mine is did not get comfort from such a clear statement and such clear proof that this government realizes the situation.
There is another aspect of the speech which will also bring comfort-admittedly it may be delayed-to the people of my district. Representing a riding which produces almost entirely primary products and which will pin its hopes for the future to quite a large extent on building up international trade and providing the seaports for such trade, these words will be of comfort:
My ministers will continue their effort to secure reductions in trade barriers. To this end preparations are actively under way for further multilateral trade negotiations later in the present year.
If the people of Skeena riding had been given the opportunity to write one sentence and put it in the speech from the throne, I think that is, to all intents and purposes, the sentence they would have written. But all cannot be perfect. I regret, as I think they will regret, an omission from the speech from the throne. In spite of suggestions which have reached us from various quarters in this house that one who occupies an obscure position on the back benches of this side of the house dare not raise his voice in criticism at any time, I still propose to express my regret that the speech from the throne does not contain some definite statement of intention with regard to a coastguard service. I speak, of course, particularly for the Pacific coast. I realize that a subcommittee of the Canadian maritime commission on search and rescue has been doing some work upon this matter, and I dare say further action will depend upon their submitting a report. But, Mr. Speaker,

it is impossible to overemphasize the importance of providing on the Pacific coast-I cannot speak for the other one-an adequate coastguard service. I use the word "coastguard" for want of a better one, because I think the service provided by the United States coastguard is just about what our people want. I am not going to try to tell this government or the officers of the department exactly what that service should consist of. That is a job for the specialists and the experts. But as this move started, so far as I am aware, about seven years ago in Prince Rupert, and as it has certainly received the backing of practically every major organization within my riding within two hundred miles of the coast I feel that I must-and I gladly do it-add my word of support to it.
Proceeding logically from the question of a coastguard service, next comes the question of radio as it affects ships and ship-to-shore communication. I notice that the speech from the throne tells us that the Canada Shipping Act is to be reopened in conjunction with the international convention for the safety of life at sea. I am no expert in reading international conventions; and while I have spent hours with the international convention for the safety of life at sea, I still have some doubts as to what it covers in certain districts and as to certain tonnages. I therefore want to make this suggestion most strongly to the government in conjunction with but not dependent upon a coastguard service. That is, that the Canada Shipping Act or other appropriate legislation should provide that every ship of, shall we say, fifty tons or more, and every ship chartered for the carrying of passengers, should carry at least one full-time radio operator who shall have no other duties but the maintenance of radio equipment and the keeping of radio watches.
The answer which is likely to be made is this: "On your coast practically every ship of any size carries a radio operator who is also perhaps assistant purser or freight clerk or something of that sort; but what does that matter, because if the ship gets into difficulties he can easily go up to his little shack and send out his message?" But that is only half the situation, Mr. Speaker. That makes it fine for that ship itself if it strikes a rock, but it makes that ship absolutely useless to give any help to another vessel twenty-five or thirty-five miles away, and out of sight, if the first ship has not a radio operator keeping watch. What is the use of a radio operator on the ship which is being wrecked dashing up to his cabin and sending off SOS's if no other radio operator is going to be in his shack until he too has an SOS or a message to send? I grant that is a reductio
The Address-Mr. Applewhaite ad absurdum but it is not so ad absurdum as it sounds because that is how the thing will work out in practice.
I do not want to waste words by repeating myself, but I urge that, when the Canada Shipping Act is being opened this year, we make absolutely certain that no vessel of, say, fifty tons or more and no vessel carrying passengers for hire be allowed to sail without a full-time radio operator-and I mean "full-time", not having other duties as well.
The speech from the throne announced a long-desired decision in the matter of veterans' affairs. At last the imperial is to receive the war veterans' allowance. The only criticism one can possibly make of that proposal is that we should like to have seen it sooner. At the same time, we cannot expect to have everything at once; neither can we expect to have everything as soon as we ask for it. I wish to commend the department and the minister most strongly for their decision at last to bring the war veterans' allowance to the imperial. This means that the War Veterans Allowance Act is going to be reopened; and I do not doubt that every minister in this government knows that the minute you open an act for one purpose, you are going to have some other requests. Hence they will not be surprised if we mention another matter in connection with the war veterans' allowance. Let me make this matter clear, Mr. Speaker. I know, and this country knows, that this government has given the veteran in Canada generous and more than generous treatment. Of that there can be no criticism. All one has to do is to compare it with any other country in the world. Unfortunately it a ways happens that some injustices may creep in, and some unforeseen difficulties may arise. As I understand, the veterans' allowance act-in fact I know what I am talking about because I was for fourteen years secretary of a Legion branch-was brought in primarily on the basis that a veteran who had served in a theatre of war during world war I was prematurely aged, and therefore the war veterans' allowance was given to him at age 65, whereas he would have to wait until age 70 to get the old age pension. Assuming that that is so-and it is so-we find a most unfortunate situation. We find that in certain generous provinces, such as British Columbia, the old age pensioner finds that he can draw, assuming he is single, $50 a month. I grant you that that does not all come from the dominion, whereas the war veterans' allowance does. I know that when that situation was brought to the attention of the departmental officials a year or so ago a subsidiary allowance arrangement
82	HOUSE OF
The Address-Mr. Applewhaite was brought in, and that it is the intention of the department to give that special allowance an opportunity to see how it works.
I want to express my personal thanks for the courtesy and consideration which the minister and the rest of his department have given to me on every occasion on which I have approached them on this subject. But I do wish to suggest that it would be the wish of the country that those old men who draw the war veterans' allowance should not draw less than the old man who draws the civilian old age pension.
The people of the Skeena district, Mr. Speaker, on whose behalf I have been speaking, do not suspect this government of being perfect. They realize that this government is composed of human beings, and that as long as human beings are human, and as long as this world is going to be an interesting place in which to live, human beings are not going to be perfect. And so they, and their representative, realize that at times there may be some reason for criticism or some places where something might have been a little better. But I want to tell you that the people of my district would sooner put their confidence in the sponsors of this speech from the throne, who mean what they say, than they would in the apostles of gloom and despair who presumably also mean what they say, and incidentally who in the past six months-and it has been my pleasure to be opposite them-seem to have spent a very great part of their time, effort and energy in twitting the Prime Minister upon the size of his majority and in advising the Prime Minister what to do with his majority, and in advising the majority what to do with their Prime Minister. That may not be hard to understand, Mr. Speaker. It is possible ' that the leaders of the opposition and some of their followers may have quite a feeling of responsibility for the size of this majority, because they helped to put it here.
I want to conclude on the note on which I started these rambling remarks. In company, I think, with every hon. member in this house, no matter where he sits, I would like to offer my personal assistance and cooperation to the government and to each

member thereof in so far as local problems of our district are concerned. I will even go further than that. I will promise not to support or endorse any expenditure or undertaking which I am not fully satisfied is in the best interests of the country. Quite apart from where we sit, we know that local ambition and local pride will cause many communities to ask for government expenditures which we cannot really state are justified in the public interest. I do not think any of us want to endorse that. I do not think any of us would want to support harebrained legislation. On the other hand, I would respectfully submit to the government that we who are the elected representatives from the different districts and who have, or who should have, or else we do not belong here, an intimate personal knowledge of the problems of our districts, should have our representations and our views, irrespective of whether they are from the opposition or from the government side, given consideration. Our local knowledge should be given consideration.
I should like to say to the government that as long as they will continue to operate along these lines and to conduct the affairs of this country as they have been doing, with the willingness to serve, with the courage and with the faith in Canada's future that they have, they and we will continue to enjoy the confidence of the country.


Mr. H. O. White (Middlesex East):: Mr. Speaker, as it is approaching eleven o'clock I would suggest that you call it eleven o'clock and I would move that the debate be adjourned.
On motion of Mr. White (Middlesex East) the debate was .adjourned.


Louis Stephen St-Laurent: I move that the house do now adjourn.



BUSINESS OF THE HOUSE

Louis Stephen St-Laurent: Tomorrow we will continue with this debate.
Motion agreed to and the house adjourned at 10.50 p.m.

Tuesday, February 21, 1950