1958-01-20

LEADER OF THE OPPOSITION


Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, I rise for two purposes today. The first is to make reference in a general way to the services of my friend the right hon. member for Quebec East (Mr. St. Laurent) and to say to him that without regard to party considerations I speak for the membership of this house when I re-express what I said on a previous occasion, namely that all of us deeply regret that his physical condition made it impossible for him to carry on and discharge the difficult and onerous responsibilities of leader of Her Majesty's loyal opposition.
I speak as one who has known him for many years. On occasions such as this all of us who have been here for three or four parliaments, engaged in the service of our country, must be conscious of the advancing of the years. I knew him as president of the Canadian Bar Association; I knew him in his other capacities; when he came into the House of Commons in December, 1941, as minister of justice and attorney general, accepting the tremendous challenge of war as an incentive to entering into public life. I knew him as secretary of state for external affairs from September 4, 1946, and at the time he was chosen as leader of the Liberal party in August, 1948. I knew him at the beginning of his prime ministership on November 15, 1948, and I have also known him in the last few months in his capacity as leader of the opposition.
As was said on another occasion by one of my predecessors, Mr. King, when he was referring to Mr. Bennett, I am not here for the purpose of estimating the place to be given by posterity to the contribution he has made. I am here for the moment, however, to wipe aside those political controversies which separate us and to say this. We regret what has taken place. As I said before, whatever our political differences may be they have been exercised in the traditions of our citizenship and in the realization that each of us, from whatever part of the house
he may come, is making that contribution which according to his conscience represents the best for Canada.


Some hon. Members:: Hear, hear.


John George Diefenbaker: I say this as one who saw him in the courts as well as in the House of Commons; an outstanding lawyer and a representative recognized by the international councils, a prime minister who in his years of service made that kind of contribution which each of us, for ourselves, would be willing to have acknowledged at the conclusion of our public service.
It was said by Mr. King in a letter to Mr. Bennett at that time that the leadership of a great party taxes the health and strength and anyone who has held that position will recognize that statement as factually correct. But I can tell you one thing, I am back here better than ever.
Distinguished in his profession and an honoured parliamentarian, the right hon. gentleman has lived a rich and fruitful life. We are not here to evaluate his career. We are here simply to say to the right hon. gentleman that our hope is that the years ahead-and may they be many-will bring to him the happiness which comes from the realization that he has served his day and generation, because of no one could this be more truly said.
Next I wish to say to my hon. friend the hon. member for Algoma East (Mr. Pearson) that we on this side of the house extend to him our warmest congratulations on the achievement of his position as Leader of the Opposition, a position which is recognized under our system as an integral part of parliament. Indeed, in the work published by Lord Hailsham, as he now is, on parliament it is said:
Her Majesty's opposition is as definite and as formal a fact as Her Majesty's government.
I listened to the convention-


Some hon. Members:: Hear, hear.


John George Diefenbaker: I followed the proceedings with that interest which one might expect. The hon. gentleman joined the Department of External Affairs in 1928. I met him first in 1934, I think it was, when he was secretary to the royal commission on price spreads set up by the then prime minister, Mr. Bennett. I saw him as an ambassador. I saw him at the United Nations

Leader of the Opposition in 1945; and since 1948 he has been a member of this chamber, until only recently as secretary of state for external affairs.
May I say this, that his service has been distinguished. His opportunities for service are greatly increased as a result of the responsibility which has now come to him. Hon. members would not expect me to say more than this: that I wish him health and happiness; I wish for him the opportunity to make that contribution which he is now in a position to make in the days ahead. I congratulate him, and extend to him my best wishes in that regard.


Mr. M. J. Coldwell (Roseiown-Biggar):: Mr. Speaker, may I too rise for the twofold purpose the Prime Minister had in mind when he rose to speak a few moments ago: first, to pay tribute to the right hon. gentleman who led the government for so long and the opposition until today. I hope he will have health and strength to remain with us and to give the parliament of Canada the advice he can give for a good many years yet.
The right hon. gentleman came here, I remember, in 1942 at a time of very great difficulty during the war, and gave freely of himself, having relinquished the practice of a profession in which he not only shone but, indeed, gloried. That was a great sacrifice on his part, and I think the country appreciated it, just as the country appreciates the services he has rendered to this nation as minister of justice, as minister of external affairs and as prime minister. And I am quite sure the right hon. gentleman knows that, whatever the fortunes of his party on June 10 of last year, that was no reflection upon the former prime minister himself.
We join the Prime Minister in expressing our regret that he has felt it necessary to lay down the reins of the leadership in which he was so distinguished and in wishing him well in the future.
I want to join the Prime Minister, too, in congratulating the hon. member for Algoma East (Mr. Pearson). I have known him now for a number of years and have been closely associated with him from time to time at international conferences. I have the highest regard and the greatest respect for him, and his only misfortune is that he is associated with the Liberal party. I could wish otherwise, because I have sometimes found my own mind running along the same channels as the hon. gentleman's mind in international affairs at least.


Mr. Sinclair:: You are in the wrong party, really.


Major James William Coldwell: I have always thought I was in the right party, and as long as I think so I shall remain in what I consider to be the right party.
I join, too, in wishing him health and strength so that he may carry on in the high office to which he has been called by the party; now, of course, occupying as he does -what shall I say-the third highest position in this House of Commons; first the Speaker, then the Prime Minister and then the leader of Her Majesty's loyal opposition. In that capacity we wish him well, and it is a capacity I hope he will fill in this house for at least some time.
I am not going to express a further opinion on this occasion; but, Mr. Speaker, we wish to join the Prime Minister in what he has said regarding the hon. member for Quebec East and the hon. member for Algoma East. We hope both will find happiness in the days to come.


Mr. Solon E. Low (Peace River):: Mr. Speaker, I am sure the Prime Minister has expressed sentiments which we in this group sincerely feel toward the retiring leader of the Liberal party, the hon. member for Quebec East. On this occasion when he is relinquishing his duties as leader of the official opposition and of his party we want him to know that we have toward him nothing but good will, and we wish him many years of happy and abundant living. We hope he will be around the House of Commons for quite a while to come, because I am sure that his experience and wise counsel will be very much needed and freely called upon.
I want also to join with those who have preceded me in expressing sincere congratulations to the new leader of the official opposition. It is not often that a man wins in so short a space of time two such great honours as those won by the hon. member for Algoma East. Of the two, of course, the one carrying with it the greatest responsibility and demanding the hardest and most unremitting effort is that of the leadership of his party and of the official opposition in this house.
I am sure the new Leader of the Opposition knows he will be expected to restore Liberal fortunes, to use his own word, "soon". He will be expected to keep his promises and all the promises made by his party. The people of Canada will remind him with embarrassing frequency, I am sure, of those parts of his nomination speech in which he said, "Liberalism must everlastingly insist on the freedom of the individual against the state".


Some hon. Members:: Hear, hear.


Solon Earl Low: And again those words, "the price of security and fair share of income to which the farmer is entitled". Canadians will keep throwing his words back in his face until every jot and tittle of their implications have been fulfilled.
The leadership of any one of the Canadian political parties is a tough job. Especially is this so of the Liberal party at this time, a party which has had many years in office and comparatively few years in opposition. On behalf of the group I am leading in this house I want to extend to the new Leader of the Opposition our sincerest good wishes, and to assure him we do hope that in the years ahead his health and strength will be always somewhat greater than the demands that will be made upon them by his heavy duties in this house and as the leader of his party.


Right Hon. L. S. St. Laurent (Quebec East):: Mr. Speaker, there have been many deeply moving occasions in the course of the years I have been a member of this house, but none more than that of this afternoon. All I can say is to express to the Prime Minister, to the hon. member for Rosetown-Biggar and to the hon. member for Peace River my very deep thanks for the kind words they have said about me on this occasion. Not only will those words be recorded in the reports of the debates of this house, but they will always be engraved in my memory, and will give me an additional reason to try and achieve everything implied in the good wishes that have been expressed on my behalf this afternoon.
I am not taking leave of the house at this moment. I enjoy the fellowship which it has been my privilege to enjoy over the years, and I wish to echo the words of the Prime Minister. Though we do differ on many occasions in this house, we do not differ upon his assumption that each one is endeavouring to do that which he thinks is in the best interests of his fellow citizens, and that is our only justification for occupying places in this house. Oh, of course we do all make mistakes, but I hope the mistakes can always be overlooked, if not forgotten, as generously as they have been this afternoon in the remarks of the Prime Minister, the hon. member for Rosetown-Biggar and the hon. member for Peace River.
That being so, I can say to those who are much younger than I that there is a great satisfaction, in spite of our human frailties, in the feeling that as members of this house we have the opportunity to be of some service to this great country.


Hon. L. B. Pearson (Leader of ihe Opposition):: Mr. Speaker, this is for me an occasion on which it is impossible not to be moved
Leader of the Opposition to the point where it is difficult for me to speak. I thank the Prime Minister for his friendly and gracious observations. Perhaps I might add that we were both away from the house last week, and I am delighted to see him back better than ever.
May I also thank my old friend the hon. member for Rosetown-Biggar for what he was good enough to say, and my friend the hon. member for Peace River, though I confess that he did make me even more conscious of the responsibilities and difficulties of my new position than I was even before.
I do appreciate more than I can say the friendly reception I have been given by the house, at least on this occasion. On my transition with almost bewildering rapidity from my commons seat of Saturday to that of today, I had no opportunity to enjoy and profit by that period of post-convention rest and reflection which my predecessors were,
I understand, able to enjoy. It was not, of course, a case of out of the frying pan into the fire, but it certainly was one of out of the convention and into the commons, which is a good place to be.
I have known the Prime Minister and the other two hon. members of the house who were good enough to speak for some years now. Their words today, Mr. Speaker, are one more evidence of the friendly feelings I have always encountered from members on both sides of the house since I first took my seat here nearly 10 years ago; feelings which are able to transcend party differences and which do reflect not only personal regard, I hope, but reflect the fact that we are all working together here as believers in responsible and stable democratic government, and that in our different ways we are all doing our best to serve the public interest.
Perhaps there is no more dramatic indication of the difference between our system of free parliamentary government and that of communist totalitarian rule than the position I now hold as leader of Her Majesty's loyal opposition. I have, for instance, this afternoon been the recipient of the good wishes of those to whose removal from office I am dedicated. I am even now the recipient of a salary from the crown to encourage me in that laudable and practicable endeavour. If as Leader of the Opposition-and this is another happy contrast with communist traditions and practices-I lose my head, it will only be in a political and temperamental, not in a physical sense.
On January 26, 1949, when the right hon. member for Quebec East (Mr. St. Laurent)- and it is difficult for me to refer to him in that capacity-spoke about the new leader of

Canadian National Railways the opposition, Mr. Drew, who was being introduced in the house that day, he said:
The position of Leader of the Opposition is a very high and honourable one. It requires a rare combination of qualities, a knowledge of public affairs and the ability to criticize firmly and boldly on proper occasions, but also the ability to discriminate between proper occasions and times when mere wordy outpourings would be anything but constructive.
I shall do my best to live up to that high conception of my office. I shall also, as leader of my party, try to be worthy in some degree at least of the example set by my predecessor. Canadian public life has had no greater gentleman or worthier or more respected servant than he was and is.
Finally, Mr. Speaker, I shall also try my very best to emulate my right hon. friend the Prime Minister in at least one respect as Leader of the Opposition; namely, to stay in this position for as short a time as he was successful in doing.



NEW MEMBER

Mr. Speaker:: I have the honour to inform the house that the Clerk of the house has received from the chief electoral officer certificate of the election and return of Erik Nielsen, Esquire, member for the electoral district of Yukon.



NEW MEMBER INTRODUCED

[Stage Direction]
Erik Nielsen, member for the electoral district of Yukon, introduced by Right Hon. J. G. Diefenbaker and Hon. Alvin Hamilton.


Hon. George H. Hees (Minister of Transport):: Mr. Speaker, I am going to make an announcement which I feel sure will be very well received by all members of the house. Before making it I should like to say that I received representations on this matter from all the members from Prince Edward Island, the hon. member for Colchester-Hants (Mr. Kennedy), and several other hon. members who have spoken to me about this matter. This is a press release issued today by the management of Canadian National Railways.
Following a meeting of senior operating officials from all regions in Canada, Canadian National Railways announced today that a supplementary winter work program would go into effect immediately in an effort to avoid any further reduction of employment on its Canadian lines during the winter months. This decision was made in response to an appeal by the federal government,

which is being directed to industry generally, including all railways, to the effect that they take special responsibility for their own work forces during this winter period when unemployment normally develops.
The management of Canadian National Railways deems it in the national interest to respond to the request of the government by embarking on work programs aimed at keeping the regular labour force employed on work that would not normally be undertaken in winter months, or which would be deferred until traffic earnings justify it.
While this may add somewhat to the cost of such work, and as well make it more difficult to reverse the deficit which appeared in the 1957 operations of Canadian National Railways, nevertheless the circumstances are such that management believes it is prudent to avoid, as far as possible, the disorganizing effects of massive short-term unemployment during this winter season. Consequently all supervisory officers have been directed to explore ways and means of organizing supplementary work programs in local areas throughout Canada, with the objective that Canadian National Railways will not contribute to further winter unemployment.
The supplementary work programs will not mean new hirings, but are of course being designed to keep the existing labour force employed. These programs will require the interested co-operation of the various labour groups, and must be sufficiently flexible to meet the varying needs of local areas. Consequently they will be under the direction of local and regional supervisory officers.
The supplementary work programs now being put into effect will be in addition to the accelerated works programs on capital account which were announced by Canadian National Railways on December 20 to provide employment for some 600 men on projects estimated to cost $3,500,000. This was made possible through advance approval by the government of a portion of the 1958 budget of the railway.
No estimate can be made of the cost of the new programs now being organized, but the nature of the work will, for the most part, be a charge to operating expense.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the minister arising out of what he has just said. In view of his statement that this welcome announcement by the Canadian National Railways is in reply to an appeal addressed by the government to all the railways in Canada, can he say whether there

has been any response from the Canadian Pacific Railway Company? If so, what has been the nature of that response?


George Harris Hees: The request to the Canadian Pacific Railway and other railways is going out today, and of course there has been no time yet for any response to be received.


Stanley Howard Knowles: Will the minister inform the house of any replies he receives?


Mr. D. F. Brown (Essex West):: May I ask
a further question of the Minister of Transport. Will he tell us whether this announcement he has made is in lieu of a general policy on unemployment in Canada?


George Harris Hees: The announcement I have made, Mr. Speaker, is an announcement which has been made today by the management of the Canadian National Railways, and is their idea of playing their part in avoiding winter unemployment.

On the orders of the day:


Donald Ferguson Brown: May I direct a question to the Minister of Transport. Since there is a large area of unemployment in the Windsor district, is the minister now prepared to recommend to the Canadian National Railways that they proceed with the construction of a C.N.R. station at Windsor, Ontario?


George Harris Hees: Mr. Speaker, the government has already recommended that particular work.


Mr. A. J. MacEachen (Inverness-Richmond):: May I address a further question to the Minister of Transport. I wonder if he could tell the house whether this additional works program he has announced will mean the calling back into employment of men who have been laid off at the C.N.R. yards at Truro numbering, I believe, about 20?


George Harris Hees: The announcement is exactly what it purports to be, an announcement to stop further lay-offs from Canadian National construction. The Canadian National, as I have said many times in this house, is just as sensitive and feels exactly as we all do about how unfortunate it is that from time to time men must of necessity be laid off from their work. They are doing everything possible to absorb all the people they possibly can, and I think the efforts they are making are commendable.


Donald Ferguson Brown: May I direct a supplementary question to the Minister of Transport. I am sure he does not want his expression to be-


Some hon. Members:: Question.
Inquiries of the Ministry


Donald Ferguson Brown: Would he tell us now when it is expected that the C.N.R. will commence work on the construction of the Canadian National station, and who are the architects who have been employed?


George Harris Hees: That matter is at present under active consideration by the management of Canadian National Railways.



LABOUR CONDITIONS


Hon. Alvin Hamilton (Minister of Northern Affairs and National Resources):: Mr. Speaker, the house will be pleased to know that the statement I made in the house on January 14 on the campground-picnic area program has been received very favourably by the provinces. At that time I mentioned that five provinces officially and one unofficially had been heard from. Since then I have received official advice from Ontario and have heard from Prince Edward Island, Nova Scotia and Manitoba.
The situation is that at the present time nine provinces have joined in this program most enthusiastically. Therefore on the forest access road program and the campground-picnic site program the expectations of the government have been far exceeded in the co-operation and enthusiastic response by the provinces. It means that the amounts we have mentioned will probably be slightly exceeded, but I think there is a deeper significance than that to this announcement.
We originally embarked on this program to provide seasonal employment, but now not only will we be providing pleasant places for travellers to stop and improve the hospitality of our highways not only for Canadians but for visitors coming to Canada but I think we will be providing safety for motorists. If this program which has been announced can improve safety on any roads in Canada I think we can all appreciate the effect and significance of the work we have done at this time.


Mr. A. M. Nicholson (Mackenzie):: I wonder whether I might ask the minister a supplementary question. Is he able to state whether the road from Flin Flon to Prince Albert via Hanson lake is included in this program he has announced?


Francis Alvin George Hamilton: Mr. Speaker,
I shall be glad to answer that question on the orders of the day. I think it is hardly a suitable one for motions. [DOT]

On the orders of the day:


Alexander Malcolm Nicholson: May I now direct a question to the Minister of Northern Affairs and Na-
3508	HOUSE OF
Inquiries of the Ministry tional Resources. I wonder if the minister could now say whether work will start at an early date on the road from Flin Flon to Prince Albert via Hanson lake?


Francis Alvin George Hamilton: Mr. Speaker, this question has been put forward in the house before, and the answer is as follows. Under the program of forest access roads we simply ask the provinces to put forward a program upon which we can pay 50 per cent of the cost. If the provincial government put forward a road program under this offer, we have no right to direct them in that regard at all. If it meets our criteria we will pay half the cost.


Mr. F. C. Christian (Okanagan Boundary):: I would like to direct a question to the Minister of Northern Affairs and National Resources. Would the federal government be prepared to make the same financial arrangements with cities or municipalities as it has made with the provinces in respect of winter employment projects, namely that 50 per cent of the expenditures will be covered by federal contributions?


Francis Alvin George Hamilton: Mr. Speaker, the hon. member for Okanagan Boundary was kind enough to give me notice of this question, and the reply is as follows:
While there may be particular instances from time to time where direct agreements between the federal government and cities or municipalities, worked out in consultation with the provinces, present the most practical answer, the normal basis of federal assistance programs is an agreement between the federal government and the provincial government or governments concerned. Whether or not assistance is then extended by the provinces to their cities or municipalities is a matter for the provincial governments to decide.
In the federal program to assist the forest access roads construction and campground and picnic area developments the agreements are or will be between the provinces and the federal governments, following the normal principles for assistance programs that I have outlined above.


Mr. H. W. Herridge (Kootenay West):: May
I ask a supplementary question. Following the announcement by the minister that the government intends to carry out a policy of constructing-forest access roads and providing pleasant picnic places, etc., would the minister be able to state the number of persons likely to be employed under these programs?


Francis Alvin George Hamilton: It is very difficult to make an estimate of the number, Mr. Speaker, but I would say that in the judgment of my department it will be between
2,000	and 4,000 people across Canada.


Mr. Alexis Caron (Hull):: Mr. Speaker, I should like to direct a question to the Minister of Northern Affairs and National Resources. Further to the proposal he has placed before the house with regard to forest access roads, has he received any answer from the province of Quebec and, if so, what was contained in that answer?


Francis Alvin George Hamilton: No, Mr. Speaker, we have not heard either officially or unofficially from the province of Quebec yet, but we certainly hope we will.



FERNIE, B.C.-STATEMENT ON REPORTED IM- PENDING CLOSURE OF COLLIERY

[Stage Direction]
On the orders of the day:
Mr. Raymond O'Hurley (Parliamentary Assistant to the Minister of Mines and Technical Surveys):: Mr. Speaker, on January 17 the hon. member for Kootenay East asked me this question:
Has the department been Informed that the Elk river colliery at Fernie will be closed permanently at the end of this month, throwing some 300 men out of work? If so, would the department see whether or not something could be done by the dominion coal board to prevent closure of the colliery at this time?
I am sorry that the Minister of Mines and Technical Surveys is not present in the house today. The answer is that the dominion coal board are working with the officials of the Crowsnest Pass Coal Company in an endeavour to keep Elk river colliery in operation. We are expecting another report from the dominion coal board.



UNEMPLOYMENT


[Stage Direction]
On the orders of the day:
Mr. H. J. Robichaud (Gloucester):: Mr. Speaker, may I direct a question to the Minister of Labour. In view of the fact that the figure of over 750,000 unemployed released by the minister covered only the period to January 2, is the minister now prepared to release the latest figures available from the unemployment insurance commission?


Hon. Michael Starr (Minister of Labour):: Mr. Speaker, the figures released by me to which the hon. member refers were not the figures of unemployed; they referred to those who had registered for unemployment insurance at the various offices across Canada. But

since he has asked for the latest official unemployment figures, and since the hon. member for Winnipeg North Centre asked me on January 13 last as to whether those figures are available, I wish to say that the latest unemployment figures were released by the dominion bureau of statistics this morning at ten o'clock.
They show that the total of unemployed, persons without jobs and seeking work, stood at 386,000 in December. The figures also show that 25,000 more people were employed in that same period over and above the number employed in December of 1956.


Hédard-J. Robichaud: Is the minister now prepared to release the latest figure of those registered for unemployment insurance benefits?


Michael Starr: Yes, Mr. Speaker. As I pointed out the other day, on January 2 there was a trend downward in increases. Where the week previous the increase had been somewhere in the neighbourhood of 65,000 in those registered in our employment offices, the week following that, there was a decrease to 56,000.


An hon. Member:: An increase.


Michael Starr: There was a decrease in the increase.


James Sinclair: Just give the official figure; that is all we are asking.


Michael Starr: The latest figure I have is for January 9, which shows an increase of somewhere in the neighbourhood of 30,000, and it shows a total of 796,000.


James Sinclair: Eight hundred thousand; yes.


Mr. Alex B. Macdonald (Vancouver-Kingsway):: Mr. Speaker, the Minister of Labour referred to the dominion bureau of statistics figures for unemployment for December. Up to what date in December were those figures to be applicable?


Michael Starr: Mid-December, Mr. Speaker.


Stanley Howard Knowles: Mr. Speaker, may I ask the Minister of Labour if when a few moments ago he answered my question of January 13 as to the most recent D.B.S. figure for unemployment he overlooked my request for the corresponding figure for one year earlier? Could he give that now?


Michael Starr: The answer is 186,000, Mr. Speaker.
96698-222i
Inquiries of the Ministry



TRANS-CANADA PIPE LINE  AMENDED WAGE SCHEDULE EAST OF PORT ARTHUR

[Stage Direction]
On the orders of the day:
['Mr. Speaker, on Friday last the hon. member for Nipissing addressed this question to me:\nCan the minister say if any rental agreements for office space in New York have been entered into by his department on behalf of any government agency since November 1, 1957?\nThe answer is, none.']
Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, may I direct a question to the Minister of Labour. Has the amended schedule of wages announced by the Department of Labour been communicated to the contracting parties on the gas pipe line spreads east of Port Arthur? If so, what effect has it had on the strike on the line?


Michael Starr: Mr. Speaker, I have not been in communication with my department this morning as yet, but I will get in touch with them to find out if the communication has gone forward.



[Stage Direction]
On the orders of the day:
Mr. J. R. Garland (Nipissing):: May I direct a question to the Prime Minister. In view of the information given the standing committee on external affairs on Friday last, will the Prime Minister now reconsider his earlier decision to withdraw the Canadian government's support for the Canada House project in New York?


Some hon. Members:: Order.


Mr. Speaker:: I believe the matter to which the hon. member has referred is still before the committee. Therefore, until we have the report of the committee it is irregular to ask a question in the house on the subject matter.


Hon. Sidney E. Smith (Secretary of Slate for External Affairs):: Mr. Speaker, on Friday last the hon. member for Nipissing addressed this question to me:
Can the minister say if any rental agreements for office space in New York have been entered into by his department on behalf of any government agency since November 1, 1957?
The answer is, none.



ATOMIC ENERGY


[Stage Direction]
On the orders of the day:
Mr. J. M. Forgie (Renfrew North):: Mr. Speaker, may I ask the Minister of Trade and Commerce if he could tell the house when work on the N.R.U. project at Des Joachims will be resumed?
3510	HOUSE OF
Inquiries of the Ministry


Hon. Gordon Churchill (Minister of Trade and Commerce):: Mr. Speaker, the N.R.U. reactor was completed in the fall and it became critical in November. It is in use at the present time.


James Moffat Forgie: May I ask a supplementary question. I think the minister misunderstood my question. I am not talking about Chalk River or Deep River; I am talking about the plant which is being undertaken by the Ontario power commission, Atomic Energy and General Electric at Des Joachims. That work was postponed about a year ago and has not been restarted since, to my knowledge. I am wondering if the minister is not confused with respect to my question between the construction of the N.R.U. plant at Des Joachims and that at Chalk River.


Gordon Minto Churchill: Mr. Speaker, I am not confused at all about this matter. The hon. member's question, of which he very kindly gave me notice, asked whether I could tell the house when work on the N.R.U. project will be resumed. That project was completed in November, became critical then, and is in use. If the hon. member is thinking of some other project I think he will have to express his question somewhat more clearly.



REPORTED ESTABLISHMENT OF PRIVATE ORGANIZATION OF BUSINESSMEN

[Stage Direction]
On the orders of the day:
Mr. E. G. Hansell (Macleod):: May I address a question to the Minister of Trade and Commerce. Does the government have any plan to finance a new private organization of Canadian businessmen to encourage trade with Great Britain and possibly other countries in the sterling area? An announcement to this effect was made in this morning's Canadian Press dispatch; and if the minister does have such a plan does he not think it would have been more appropriate, since it involves the spending of public funds-


Some hon. Members:: Order.


Ernest George Hansell: -does the minister not think it would have been more appropriate to make a statement in the house?


Gordon Minto Churchill: Mr. Speaker, the hon. member is under a misapprehension. No announcement was made on the part of the government. The article he read in the press, without critical attention, was press speculation. When government policy is to be announced with regard to a continuing program of the trade mission it will be announced in the house.



ALLEGED REFUSAL TO PERMIT EXPORT OF NATURAL GAS

[Stage Direction]
On the orders of the day:
Mr. S. H. S. Thompson (Edmonion-Sfralh-cona):: Mr. Speaker, I should like to direct two related questions to the Minister of Trade and Commerce, notice of which has been given. We are, I am sure, all in agreement with the government's action in forwarding a note of protest to the United States last week regarding the restriction on the import of Canadian oil, but in view of this protest how does the government justify its refusal to allow the export of Alberta gas to the United States?


Mr. Speaker:: Order. The hon. member has asked a complete question. If he goes on to comment on it he will put himself out of order.


Sydney Herbert Stewart Thompson: Are
coal, gas and oil not interchangeable fuels for the production of energy?


Gordon Minto Churchill: Mr. Speaker, I thank the hon. member for giving me notice of these two questions. The answer to the first one is that no justification is required because no refusal has been made. The answer to the second scientific question is that all three fuels can be used to produce steam to be transferred into mechanical or electrical energy and to that extent are interchangeable, but not otherwise.


Sydney Herbert Stewart Thompson: should like to ask a supplementary question. I understood the minister to say there has been no refusal to export gas. Does this mean that the export of gas to the United States is permitted?



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Claude Ellis (Regina City):: Mr. Speaker, this question is directed to the Minister of Public Works and arises out of his answer to a question I asked on Saturday last regarding government assistance to home construction in Canada. In view of the fact that only $90 million remains available for direct lending under the National Housing Act, what steps does the government intend taking to provide additional government money for housing through the agency loan plan?

If the government does not intend to amend the National Housing Act this session for that purpose, what steps does it intend taking to ensure that the $1,400 million mortgage money required to meet the government's stated objective this year will be made available?


Hon. Howard C. Green (Minister of Public Works):: The hon. member must not be so impatient. As I pointed out to the house on Saturday there is still the sum of $90 million available, and if further money is required the government will not hesitate to ask parliament to vote it. It is not the intention to bring in any further amendments to the National Housing Act this session.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
James Sinclair: Mr. Speaker, may I direct a friendly question to the Minister of National Revenue as the minister in charge of the C.B.C. Would the minister convey to the officials and staff of the C.B.C. the appreciation of the Liberal party for the magnificent job they did in radio and television coverage of the biggest and most enthusiastic convention Canada has ever seen?


Hon. G. C. Nowlan (Minister of National Revenue):: Mr. Speaker, on behalf of the C.B.C. I appreciate the friendly words of the hon. member for Coast-Capilano. I will be very glad to do what he suggests, with the two qualifications that it was neither the largest convention nor the most enthusiastic.



ST. LAWRENCE RIVER  STATEMENT ON AGREE- MENT BETWEEN CANADA AND ONTARIO

[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, on January 13 last the hon. member for Laurier directed a question to the Prime Minister inquiring as to the intention of the government respecting renegotiation of the Canada-Ontario agreement of 1951. As several departments were involved, the question was taken as notice by the Secretary of State for External Affairs.
My department is particularly concerned, and I may reply that the government recognizes that certain sections of the agreement
Inquiries of the Ministry are inoperative, and at an appropriate time it is our intention to renegotiate the agreement.



COMMUNICATIONS


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, on January 11 the hon. member for Bonavista-Twillingate asked me to make representation to Canadian Overseas Telecommunication Corporation to try to reduce the delays encountered in making telephone calls to Newfoundland. I have looked into this matter, and I find that both C.O.T.C. and C.N.T. have so extended their operations from the mainland to the island in recent years that circuits available are fully adequate to meet present requirements.
Additional local lines may be needed in some less populated areas of the island, but these would be the responsibility of the companies engaged in providing local service rather than of Canadian Overseas Telecommunication Corporation, which is primarily engaged in international service and the provision of through lines.
It is possible that the hon. member may have experienced some delay in the period preceding the day he raised the question. I am informed that if this was so, it was caused by heavy storms in the maritime area which interrupted normal routings on that occasion.


Mr. Pickersgill:: Mr. Speaker, I wonder
whether the minister has attempted to make a telephone call to St. John's recently?


George Harris Hees: No, Mr. Speaker, I have not had that pleasure.



OVERSEAS TELECOMMUNICATION CORP.  STATE- MENT ON MOVEMENT OF EQUIPMENT

[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, the hon. member for Comox-Alberni inquired on January 14 about the plans of Canadian Overseas Telecommunication Corporation to move their facilities at Bamfield to Port Alberni.
I am advised that this project, which involved a total expenditure of approximately $70,000 for a transfer of the Bamfield cable station at Port Alberni, is now under way. Work is about to start under contract for clearing the site, and it is hoped that construction of the building can commence within the next two months.

Inquiries of the Ministry TRANSPORT



NEWFOUNDLAND


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, may I take this opportunity to reply to a question which was asked by the hon. member for Trinity-Conception on January 13 regarding a derailment which had taken place on the Canadian National Railways system in Newfoundland on January 11.
I am advised by the management of the railway that a full investigation is being made by the railway officers, and reports will be made to the board of transport commissioners in compliance with the board's regulations. The line was cleared and made passable the day following the derailment.



REFERENCE TO ACCIDENT AT BELLS CORNERS LEVEL CROSSING

[Stage Direction]
On the orders of the day:
Mr. E. G. McCullough (Moose Mountain):: Mr. Speaker, I should like to direct a question to the Minister of Transport. In view of the fatal accident at the railway crossing at Bells Corners last evening and the growing number of fatal accidents in the province of Ontario and across Canada in general, could the minister inform the house whether the government is taking action to attempt to speed up the installation of electrically controlled warning systems at these level crossings? I should like in particular to have the government make a special effort at installing such a device at this very dangerous crossing, where a number of serious accidents have occurred.


George Harris Hees: Mr. Speaker, this matter is one for consideration and action by the board of transport commissioners. They have under consideration at all times matters such as this, and I will be glad to bring the particular location referred to by the hon. gentleman to the attention of the chairman of the board.


Alfred Claude Ellis: Mr. Speaker, I should like to direct a question to the Minister of Transport supplementary to and arising out of the question asked by the hon. member for Moose Mountain. Is it the intention of the government to bring in amendments to provide for an increase in the moneys allotted under the railway grade crossing fund to stimulate a greater use of this fund in an effort to avoid these fatal accidents?


George Harris Hees: Mr. Speaker, the government has this matter under consideration. The requirements are growing in this regard at a very great rate, and the government has it very much under consideration.



DOMINION-PROVINCIAL RELATIONS GENERAL EXTENSION OF ATLANTIC PROVINCES ASSISTANCE PROGRAM

[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Prime Minister. Is the Prime Minister yet in a position to answer my question of a week ago as to whether or not he intends to make a more substantial reply by letter to the letter that Premier Campbell of Manitoba addressed to him on December 18, 1957?


John George Diefenbaker: Mr. Speaker, I have not had any opportunity to consider that matter since the hon. gentleman asked the question. But I think there is a paragraph in my letter, as I recollect it, saying that a further letter would be sent to Premier Campbell. That is my intention. I speak entirely from recollection. I was under the impression, as I listened to the question, that there was a portion of my letter which gave promise of a further letter.


John Whitney Pickersgill: Mr. Speaker, may I direct a supplementary question to the Prime Minister. Has he yet had an opportunity to find out if there was a letter from the premier of Nova Scotia which was not tabled with the other correspondence? I asked the Acting Prime Minister the other day-


Mr. Speaker:: I understand that question was answered.


George Harris Hees: In the absence of the hon. member.


John Whitney Pickersgill: I apologize; I was not in
the house on Saturday.



THE CANADIAN ECONOMY


[Stage Direction]
On the orders of the day:
Mr. H. A. Olson (Medicine Hal):: Mr. Speaker, I should like to direct a question to the Prime Minister. Can the Prime Minister tell us whether or not there will be an interim report on gas and oil from the Borden commission inquiring into energy?

Righl Hon. J. G. Diefenbaker (Prime Minister): I cannot state definitely, but certainly it is my desire and that of the government that an interim report be made, and that desire has been or will be made known to the Borden commission in order to ensure that it is understood that an interim report is expected.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, on Friday last the hon. member for Winnipeg North Centre raised a question as to whether Canadian Pacific Airlines could be required to carry out its repair and overhaul work in Canada. It is my understanding that in fact C.P.A. does carry out its major overhaul and maintenance work at its base in Vancouver, where it has already invested many thousands of dollars in extensive facilities for this purpose, and that maintenance work is done outside the country only in accordance with the requirements of operational expediency.
In any case, examination of my authority under the Aeronautics Act has led me to the conclusion that it would scarcely be a proper exercise of my authority thereunder to issue orders or to place restrictions on Canadian air lines in the manner suggested by my hon. friend.
May I also remind him that C.P.A., like T.C.A., operates to many foreign countries and must comply with the legal requirements of those foreign countries too in the matter of local operation and organization.
I believe the hon. member's question may have been asked as the result of an advertisement relating to proposed lower fares to Europe, which were to be introduced subject to governmental approval. May I explain to him that the phrase "subject to governmental approval" meant that the proposed new fares had not yet received the approval of the air transport board, which exercises jurisdiction over all air line fares but that in this respect C.P.A. is not proposing anything materially different from T.C.A. or any other international air line, since international fares in this category are set on a uniform basis as a result of discussions among the members of the international air transport association, including both C.P.A. and T.C.A., and then submitted for approval of the respective international aeronautical authorities concerned.
Inquiries of the Ministry



AIR FRANCE


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, I should also like to reply to the question asked on Friday by the hon. member for Laurier, as to whether consideration has been given to an application for fifth freedom rights at Montreal by Air France.
A review is now being made of Canada's international civil aviation policy, and the question of the exchange of fifth freedom rights is one of the matters under consideration.



MARITIME AIRWAYS CRASH, QUEBEC    STATEMENT ON PUBLIC INQUIRY

[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, on Saturday the hon. member for St. Antoine-Westmount inquired as to the names of counsel appointed in connection with the inquiry into the crash of an aircraft toward the end of August at Issoudun, Quebec. The Minister of Justice has appointed Mr. Ross Drouin, Q.C., of Quebec city, and Mr. W. Gerald Stewart, Q.C., of Moncton, to act as counsel for the board of inquiry.



SHIPPING


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, may I direct a question to the Prime Minister. Will he ask the chairman of the royal commission on coastal shipping when it is expected the report on that subject will be before the house? I asked this question of the Prime Minister earlier in the session, and after consultation with the chairman he indicated that the report would be brought down toward the end of 1957. I wonder if we could not have a more up to date reply.


John George Diefenbaker: Mr. Speaker, speaking again from recollection, I have not heard anything further than what I have already stated. I will get in touch with the chairman of that commission in order to ascertain the situation.



FINANCE


[Stage Direction]
On the orders of the day:
Frank Claus Christian: Mr. Speaker, I have a question to direct to the Minister of Finance, notice of which has

Inquiries of the Ministry been given. Has the government taken any steps to have reviewed, for the purpose of revising, the monetary and fiscal policies of Canada, with a view to minimizing or solving Canada's trade and unemployment problems?


Mr. Speaker:: Order. The hon. gentleman's question covers a lot of territory and I doubt that he could expect an answer on orders of the day. I suggest he reserve it for the next order of business.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Mr. Ambrose Holowach (Edmonton East):: Mr. Speaker, may I direct a question to the Minister of Agriculture. Has the minister received any communication from the commercial egg and poultry producers' association of Alberta, pointing out to him that Edmonton wholesalers have dropped the price to egg producers from 30 cents to 28 cents for grade A large eggs? If so, what action is the department taking or does it intend to take to deal with this situation?


Hon. D. S. Harkness (Minisler of Agriculture):: Mr. Speaker, the hon. member is approximately ten days late with this question. The leader of his party asked a very similar question on January 11 and the answer is to be found at page 3189 of Hansard, together with the answers to several supplementary questions on this same subject.
I might say I indicated at that time that I had taken steps to see that the price was restored to 30 cents a dozen, and that went into effect a week ago today.



FREIGHT RATES


[Stage Direction]
On the orders of the day:
Mr.  H. M. Balfen@Humber-St. George's: Mr. Speaker, may I direct a question to the Minister of Transport. Has the minister received a telegram from the chamber of commerce' of Corner Brook, Newfoundland, stating that the Newfoundland division of the Canadian National Railways has already applied a 3.6 per cent increase in freight rates, in contravention of the statement of suspension until March 1, 1958, made by the Prime Minister on January 7. If so, what action has been taken?


George Harris Hees: Mr. Speaker, I have not as yet received such a telegram, but I feel certain that a

mistake has been made. I shall look into the matter and report to the house tomorrow.



COMMONWEALTH RELATIONS


[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Assiniboia):: Mr. Speaker, I have a question to direct to the Prime Minister. I wonder whether he has an answer to the question I asked him a few days ago, as to whether talks had taken place between the officials of the West Indies federation and the Canadian government, and whether the new federation had asked Canada for a loan or other financial assistance.


John George Diefenbaker: No, Mr. Speaker. I will have that looked into.


Hon. Donald M. Fleming (Minisler of Finance) moved: that the house go into committee of supply.



AMENDMENT CALLING FOR RESIGNATION OF GOVERNMENT

Lester Bowles Pearson: Mr. Speaker, this is the first occasion, apart from that happy one of a few moments ago, on which I have had to speak in my new capacity; and I am very conscious of the fact, Mr. Speaker, that I do so in circumstances and at a time not exactly of my own choosing. I am also very conscious of the fact that I am speaking at a serious time in the history of our country, and indeed in the history of the world; that domestic and international problems are such that they demand action characterized on the part of every single person concerned-and that includes all of us-by responsibility and a clear recognition of the national interest.
It is my duty, of course, as leader of the official opposition, guided I hope always by the considerations which I have just mentioned, to point out whenever it is required and to drive home as vigorously as I can, the inadequacy of government measures, the sins of omission and commission of the government in the handling of current problems which, as I have indicated, are serious and difficult, problems which face us now to an extent and in a manner not even contemplated last June.
I think it will be agreed, Mr. Speaker, that proposals for vigorous and effective domestic action are certainly required at this moment, in view of the trade and unemployment situation in this country. If we on this side of

Suggested Resignation of Government
the house stress that we have a duty to perform because of the seriousness of that situation, I hope that no one on the other side will make the insinuation that we take any satisfaction, even the slightest, for political or any other reasons, out of any development, or any threat of such development, that affects in an unfavourable way our employment, trade or economic situation in this country.
A man out of work is no political pawn and is far more than a unit in a number. Our concern in the official opposition is to do whatever we can to urge policies which will get that man back to work. It seems to me two things are required for that purpose; first, full knowledge of the facts and the prospects ahead, and we have had some information on that score this afternoon; and second, government policies which will be effective in dealing with these facts, especially through their result in the creation of jobs.
That, Mr. Speaker, is very much on my mind, as I know it is on the minds of all members of this house, as I rise on this occasion to define the position that the official opposition proposes to take, not merely on this motion for the house to go into committee of supply but with regard to the remaining business of the session generally.
Hon. members will recall the statement made by my right hon. friend from Quebec East at the opening of this session. He said on October 16, as recorded at page 43 of Hansard:
I believe I have reached a point where I should indicate, as precisely as I can, what the attitude of the Liberal opposition will be to the new government during the present session when I expect to be responsible for leading the opposition.
In other words, Mr. Speaker, my distinguished predecessor expected, as we all expected, the government would so arrange the business that this session would have been concluded in 1957. However, instead of getting on with and finishing unfinished business, the government chose to bring forward a considerable legislative program-


Michael Starr: For the good of the people.


Lester Bowles Pearson: which evidently delayed consideration of the estimates and prolonged the session into the new year.


Some hon. Members:: Oh, oh.


Howard Charles Green: Of all the nerve.


Gordon Minto Churchill: You have to do better than that.


Lionel Chevrier: Shout him down; that is what you have been doing all session.


Lester Bowles Pearson: Mr. Speaker, if I may proceed, I think my hon. friends will have plenty of opportunity to intervene later as I proceed. Perhaps they should reserve some of their vocal energy for subsequent parts of my message. In the consideration of that program, Mr. Speaker, the government received the utmost co-operation from the official opposition.


George Harris Hees: For a very good reason.


Lester Bowles Pearson: The new ministers, Mr. Speaker, have boasted of their immense legislative achievements.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: Perhaps I may put on the record one or two quotations to verify that statement, as reported in the press. The leader of the house is reported as having said on November 21:
The new cabinet already had carried out election campaign pledges with such legislation as old age security, veterans pensions, cash advances on wheat.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: The Minister of Transport (Mr. Hees), in that exuberant way in which he sometimes talks outside the house, especially to a friendly audience, is reported as having said on December 9:
The Liberals told us that promises we were making were just election promises. Well-
This was the Minister of Transport on December 9.
-we have kept every single one of the promises that we made during the elections.
On December 9.


George Harris Hees: Never was so much truth spoken.


Lester Bowles Pearson: The Minister of National Revenue (Mr. Nowlan) was even more emphatic and even more optimistic, because as far back as October 24 my hon. friend said this

this was October 24-as reported in the press of that day:
We have been successful in implementing all the major election promises we made.


George Clyde Nowlan: Surely you do not deny it.


Lester Bowles Pearson: He is reported further as saying:
I do not think any political party in history was able to match that record.
I do not think any cabinet minister in history was able to match that statement.


George Clyde Nowlan: He was never lucky enough to belong to such a government before.


Lester Bowles Pearson: Well, sir, if this magnificent legislative achievement has in fact taken place, it is not logical or reasonable that the
3516	HOUSE OF
Suggested Resignation of Government members of the government should then turn around and pretend that there has been obstruction here.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: Yet, Mr. Speaker, that is exactly what a number of them have tried to do, for purposes which are perfectly obvious to all of us. Indeed, the Prime Minister is reported as having gone so far as to say that because we have asked so many questions in the House of Commons, as an opposition should, the dominion-provincial conference has now been postponed. It is needless to add that we do not agree nor do the public agree, I think, that all these promises have been fulfilled. But it is true that we have not stopped the government or sought to stop them from fulfilling these promises.


George Harris Hees: For a very good reason.


Lester Bowles Pearson: Now, Mr. Speaker, the attitude of my predecessor, speaking on behalf of this party, an attitude he indicated last October as to what this party should do in respect of the business of the present session, is to be found, as hon. members know, at page 44 of Hansard of October 16. I want to repeat this for the record; it has a bearing on what I am going to say. My right hon. friend said at that time:
Indeed, our view is that a minority in parliament should not seek to obstruct the will of the majority unless the minority believes-and that may be possible at times-that there is at stake a principle of such importance to the nation that the minority should do everything in its power to bring the question before the electorate itself for a decision.
So long as this session lasts, Mr. Speaker, and while this government is in office we intend to continue to give the government the chance to bring down legislation.


Some hon. Members:: Oh, oh.


Lester Bowles Pearson: If my hon. friends would just be patient for a little while they might not laugh.


Douglas Scott Harkness: Where are the brave words of Thursday?


Lester Bowles Pearson: We intend to continue to give the government a chance to bring down legislation to implement their promises as long as this session continues and they are in office. We will support whatever is good in that legislation and criticize vigorously whenever we do not think it in the public interest. But, Mr. Speaker, and this may be in contrast to attitudes adopted on this side of the house in years recently gone by, we shall not offer opposition just for the sake of opposition. However, Mr. Speaker, it looks more and more as if the government has really shot its bolt-


Some hon. Members:: Oh, oh.


Lester Bowles Pearson: -with the increases in social security and veterans benefits, cash advances on farm-stored grain, which are really interest-free loans, increased housing loans and the disappointing tax reductions from our surplus which fell so very far short of their pre-election promises.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: Apart from the loan for the Beechwood project and the bill to authorize thermal power plants in the Atlantic provinces, which were originally proposed in Mr. Harris' last budget-


Some hon. Members:: Oh, oh.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: -that, Mr. Speaker, is the record of Tory achievement in seven months, plus the appointment of sundry royal commissions and missions which for the time being will help some chickens from coming home to roost on the limb on which the government has got itself by its promises.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: But, Mr. Speaker, that is certainly the total record of this government, and for a few moments now I want to look at the other side of that record. My predecessor said at the opening of the session, and again in his farewell speech at the national Liberal convention the other evening, that the only field in which the Conservative government had tried anything new was trade; and what is new there has been a sorry disappointment.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: Let me go through the various stages of this dismal failure. There was first the famous 15 per cent diversion press conference last July. Then there was the Mont Tremblant conference and the Thorneycroft bombshell. Then there was the journey of the four pilgrims to Washington.


Some hon. Members:: Oh, oh.


James Sinclair: "We fixed them."


Lester Bowles Pearson: It is not so much the observation of the United States cabinet minister which has just been mentioned in which I am interested as the statement of the Minister of Finance after that meeting to the effect that the Canadian government now had real commitments from the United States government on whch they could rely.
Then there is, if I may designate it by these terms, the Churchill mission to the United Kingdom, as to which we have had no report

with regard with concrete achievements, although we have had some very interesting information as to how well it has been treated on the other side. While the efforts were being made by this mission abroad to increase and expand British imports into Canada,-an increase that we should all like to see brought about by the right methods-the Minister of Finance (Mr. Fleming) at home referred more than once to the references to the tariff board by the wool and other industries that are seeking higher duties which would restrict British imports into this country.
Then there are the 15 per cent oil restrictions imposed by the United States which, while we were in power, Mr. Speaker, we managed to avoid. There are threats to our exports to the United States of base metals and fish. These are not to be taken lightly having regard to the effect that they will have on our trade. I can assure the government that we on this side will back to the limit any efforts which they make-and they are making efforts-with the government of the United States to get that former restriction removed and to prevent the latter. There is no division in parliament or in the country, I am sure, over this matter, and we shall be glad to support them in any practicable effort they can make to that end.
Then finally may I say this. It is clear now that our total trade has ceased to expand and that our export markets are threatened, that proposals for freer trade have been rebuffed and that some encouragement-and I think it is fair to say this-has been given to United States protectionist forces which it is devoutly to be hoped by us all will be kept in check in Washington.
Part of the decline in trade and business is I think owing to the decline in actual private investment and even more to the serious decline in investment intention, and we are in the midst of what the Minister of Trade and Commerce (Mr. Churchill) has referred to as an economic pause. Of course, part of this decline in investment results from world conditions. There is no doubt about that fact, and that is something over which no national government can exercise anything but a measure of control and influence. But having said that I will add that the unfriendly and uncertain atmosphere indicated by certain attitudes to the United States which have been taken by my friends of the party opposite have created an uncertainty as to financial and economic policy which is aggravating the decline which is taking place.
It seems to me, Mr. Speaker, that you cannot tell a country, with great fanfare and much emphasis, that you are going to take $626 million of exports away from them and 96698-223i
Suggested Resignation of Government then expect the same feeling of confidence in that country and a desire to invest in your country. This declining investment is, of course, one of the causes of mounting unemployment. Hence I believe there is real need to restore the climate of confidence, to reassure potential investors, to remove fear of the future and meanwhile to step up public investment in Canada in order to take in some of the slack in employment in this country. That is what we are interested in on this side of the house, not so much how we got to these figures but how we can get out of them.
Something has been done by the government in this field but I suggest that not enough has been done. There have been housing loans and they have been welcome, but not very extensive measures with regard to national parks, forests and picnic grounds which, I think in view of the fact that the maximum amount which they are likely to give is between $3,000 and $4,000, are hardly likely to be an adequate contribution to the needs of employment in this field. What is needed is bold and imaginative action by the government while a favourable climate is being restored. The fear of unemployment is our greatest fear in this country today next to war itself. To remove that fear I suggest that we should get back on the Liberal road to expanding trade, expanding investment and expanding employment.
Then there is the agricultural question and the problems of farmers and primary producers. As we know, farmers are and have been for some time caught in the price squeeze. We also know that they were promised quick and welcome relief by my hon. friends opposite. What have they been offered? They have been offered one bill, Mr. Speaker, which called forth such violent protests from agricultural organizations that it had to be rewritten and the Minister of Agriculture (Mr. Harkness) had to get the unanimous consent of the house to substitute a new bill with which the farmers are not yet satisfied. Indeed, many believe that the new bill is not as good as the Liberal price support legislation of 1944. We take the view Mr. Speaker, that what is now required is not so much new legislation as new policy. I would refer to the resolution on agriculture adopted by the National Liberal convention as an indication of what that policy should be. Loggers are already depressed by the drastic decline in the pulpwood market and the whole fishing industry is apprehensive about these United States tariff changes which they have good cause to fear. The miners are worried by the same threat from south of the border.
Then, Mr. Speaker, there is this question of provincial relations. Before the election the

Suggested Resignation of Government Prime Minister (Mr. Diefenbaker) promised a conference-not soon but immediately-to solve the financial problems of the provinces and the municipalities. That conference was delayed for five months. Then when it met it ignored general fiscal relations and concentrated on other matters. Even the Atlantic provinces' grants appear to have bogged down. At least we cannot find out whether they are for the present fiscal year or only for 1958-59. The refusal of the minister to define a national power policy, ignoring the request for an amendment to the power bill made by the premier of Newfoundland, is very much in our minds today. Provincial treasurers do not know what to expect from this government. Surely it is another matter of real urgency to deal with this problem so that the provinces can get on with the public works program to help provide employment and relieve the municipalities.
Mr. Speaker, we now come to the national accounting which we have not got. The Minister of Finance categorically promised such a national accounting when he said he would introduce a budget and perhaps he would not mind if I put on the record once again, because it is recorded in Hansard on page 45 of October 16, 1957 that, according to the Canadian Press, on June 25 he said:
Finance Minister Donald Fleming said tonight he plans to bring down a new budget next fall to reduce taxes, increase old age pension and possibly curb government spending.
My right hon. friend who was at that time leader of the opposition went on to say:
We are all looking forward to the presentation of this budget and to a full debate on the case the Minister of Finance will present at that time.
We are still looking forward to it. My right hon. friend continued as follows:
From time to time I have noticed from press rumours that the government intends to make important changes in the fiscal policy of this country without giving the elected representatives of the Canadian people an opportunity for a full debate which, under our parliamentary system, is afforded by the presentation of a budget. I refuse to believe that a government whose leading members made so much of their attachment to the rights of parliament would seriously propose, both to alter the tax structure of the country and to increase expenditures substantially without giving parliament every opportunity afforded by the rules to consider the whole financial picture and to debate fully the benefits of proposed changes upon the economy.


Stanley Howard Knowles: He
should have known better.


Lester Bowles Pearson: Perhaps, but my right hon. friend refused to believe it then. However, he has to believe it now because we know the procedure that was adopted and under that procedure we have not secured that national accounting.

We did get some financial and tax legislation but when members of this house, in accordance with procedure adopted for this purpose, attempted to amend this legislation and when they were ruled in order by the chairman in respect to their efforts, the government overruled its own chairman. I think I am right in saying that not one single member of the party opposite objected to that overruling.


Howard Charles Green: The Liberals ran out.


Lester Bowles Pearson: We do not know very much about the national budgetary picture. We do know that expenditures have not been reduced as promised, but vastly increased. We do know that the course of national production has been levelled off and is probably declining, that revenues are declining, that there will almost certainly be a deficit in the present fiscal year and that there is a prospect of a huge deficit in 1958 to 1959. I suggest, Mr. Speaker, that this is a dismal contrast in seven short months to the Liberal financial record of preceding years and what a contrast it is to the promises of half a billion dollars in tax reductions and half a billion dollars in reduced expenditures.
No wonder this government apparently is not anxious to disclose the facts to the Canadian people and in the light of this situation it is not perhaps so hard to understand why the Minister of Finance failed to bring in the budget he so gaily promised last July and why he may wish to avoid bringing in a budget this spring.
Then there is the field of defence and security. There is no need for me, nor shall I attempt, Mr. Speaker, to dwell on the confusion existing in this field.


Gordon Minto Churchill: In your own mind.


Lester Bowles Pearson: The utter confusion and contradiction over NORAD, for instance, with no parliamentary discussion or decision in regard to that vitally important step. Indeed, so far as we know up to this moment, there has been no inter-governmental agreement on which a discussion could be based. I will leave it at that-the confusion in this particular matter is one of baffling bewilderment.
We have the right to say from the record of these months that in every field, this government lives from day to day with hand to mouth policies, a yielding response to one pressure, a concession in another quarter with no consistent pattern, no attempt to fit particular projects into a national design, no vision for the future but a ceaseless preoccupation with the politics and publicities of the day.
I have barely outlined the record, but my colleagues will be filling in the details during

this debate and, because of that record, it is my intention at the close of this statement to move an amendment to the motion.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: My hon. friends opposite may just possibly find they are a little premature in their applause. At the beginning of the session and on successive supply motions my distinguished predecessor has indicated that the official opposition would not move amendments nor would it support amendments moved elsewhere. Why, then, am I departing from that course of conduct and doing so, as I am, with the concurrence of my predecessor? The reason, Mr. Speaker, is that there has been a deterioration in the Canadian economy during these months.
The hon. gentlemen opposite call this deterioration a pause, a word they may come to regret. It is a deterioration of a kind which makes us believe the Canadian people would welcome a return, and an immediate return, of a government which would apply Liberal policies to our national administration.


Mr. Robinson:: We will accept your challenge.


Lester Bowles Pearson: We will come to this amendment in its textural form in a few moments, but I will give an indication of the type of amendment I propose to move. It is along these lines: That in view of the facts which I have outlined representing the deterioration of the Canadian economic picture; in view of the fact that there is a growing confusion and uncertainty in so many aspects of the Canadian picture; in view of the fact that day to day expedients have been substituted for firm and steady administration;-


Some hon. Members:: Oh, oh, double talk.


Lester Bowles Pearson: -and furthermore in view of the desirability at this time of having a government pledged to implementation of Liberal policies of the kind outlined in the resolutions of the national Liberal convention-


Douglas Scott Harkness: What are these Liberal policies? Nobody has heard of them in this country for 40 years.


Lester Bowles Pearson: My hon. friend will be able to read them and that is more than he is able to do in regard to the resolutions of his own party's convention a year ago.
In view of all these things, Mr. Speaker, it is our view that His Excellency's advisers should, in the interest of this House of Commons, submit their resignations. Hon. members will know that the motion which I propose to move, the purport of which I have indicated, is not designed to bring on an
Suggested Resignation of Government immediate election by any action on our part, though the government and its supporters can take action on their part at any time they see fit.
I confess, Mr. Speaker, that there are arguments in favour of that course on our side which appeal to me, but it is clear that an election at this time, in the winter months-


George Harris Hees: Would beat the pants off you, and you know it.


Some hon. Members:: Resign.


Mr. Speaker:: Both sides seem to show the same enthusiasm, if not the same unanimity. I think we all want to hear the hon. member for Algoma East.


Lester Bowles Pearson: I ask hon. gentlemen opposite this: do they think that an election at this particular moment would help to solve the unemployment problem, or would it delay for two or two and a half months the action which is necessary and which should be taken at this time? An election at this time-and it may come-and if it comes, we will be ready for it-would perhaps not help us to get back on the road of expanding trade and expanding investment; it would prolong and, perhaps, during the period of an election campaign, intensify the uncertaintly and the fear for the future which now exists.
Also, Mr. Speaker, an election at this time

though it may come-would mean that millions in this country would choose their government without adequate information about the dismal and depressing decline of the Canadian economy since last summer and the paralysis of the government in the face of growing problems, and would leave the voters without any national accounting by which they might judge the government.
What our motion does, Mr. Speaker, is to ask the government to make way in this parliament for a government pledged to implement Liberal policies in which we believe-


Donald Methuen Fleming: Mike, it is sad to see you come to this.


Lester Bowles Pearson: -the policies we have recently re-affirmed and the new policies we have recently adopted. Mr. Speaker, we think that this parliament, which is only seven months old, should be allowed to grapple with these problems under the leadership of a government which knows where it is going, which knows what it wants to do and which possesses coherent and constructive long-range policies.
Moreover, Mr. Speaker, we now have the same title to form a government in this parliament as the Conservative party had

Suggested Resignation of Government several months ago. We would be a minority of members, it is true, but so are they, and we represent nearly a quarter of a million more voters.


George Harris Hees: Go to the country and see if they vote for you now.


Some hon. Members:: Resign, resign.


Lester Bowles Pearson: Of course, Mr. Speaker, our title, like theirs, would depend upon our capacity to obtain and retain a majority in this house in favour of the measures we would bring down; but we would put forward policies which would, I hope, secure that support.
We resigned last June because we did not feel we could reasonably hope for a majority in the house at that time, and in order to give the Conservative party a chance to show what they could do.


Donald Methuen Fleming: How generous of you!


Lester Bowles Pearson: I am surprised at the agitation shown by hon. gentlemen opposite at the very prospect of resignation. Today, Mr. Speaker, we know what they can and cannot do. We know that in June trade and investment of all kinds in this country were growing. We know today that the situation is very different indeed. This parliament therefore has a perfect right at this time to give its confidence to a new government. The motion I intend to move asserts the desirability at this time of having a government pledged to implement Liberal policies as they have now been put forward as a Liberal platform in resolutions adopted by a national convention. I assume that every hon. member who votes for this motion will by his vote be asserting his willingness to support a new government pledged to implement these policies.
On that assumption and with that assurance I would be prepared, if called upon, to form such a government to tackle immediately the formidable problem of ending the Tory pause and getting this country back on the Liberal highway of progress from which we have been temporarily diverted.
If, Mr. Speaker, there is no majority for my amendment, then let us hope that the present government will stay here and face the problems that now exist and deal effectively with declining trade and employment, and bring down a budget so that the people will know what the situation is when they are called upon to elect a new parliament.
Nothing has been more obvious than the desire of this government for a defeat in this house. Their morbid preoccupation with an election is due, I think, to their desire to go to the people before the people have time to realize how bad their record already is,

and before the people fully realize how seriously they have undermined confidence in our future. The election last June revealed clearly that there are two alternatives before the public, and only two: a Conservative or a Liberal government.


Alfred Claude Ellis: What is the difference?


Lester Bowles Pearson: Take a look at our resolutions and you will find the difference. If this motion is defeated and the government remains in office the public are entitled to the assurance that there will not be an election without a budget and without completing the federal-provincial conference and implementing the rest of the Tory promises so people will know for what they are voting. That is why I have framed my amendment so as to place the alternative clearly before hon. members and particularly those hon. members who do not support the government or the official opposition. If hon. members feel that the present government should be given more time to carry out its promises, they should vote against my amendment; if they feel, as we do, that it would be better at this time to have a Liberal government which will introduce Liberal proposals into this house, they should vote for the amendment.


Some hon. Members:: Oh, oh.


Donald Methuen Fleming: You are laughing yourself at that one.


Lester Bowles Pearson: Needless to say, Mr. Speaker, I hope a majority of hon. members will vote for this amendment. I therefore move, seconded by the hon. member for Quebec East (Mr. St. Laurent):
That all the words after the word "That" be struck out and the following substituted therefor:
In view of the fact that, in the seven months His Excellency's advisers have been in office, Canada's total trade, has ceased to expand, export markets have been threatened, and proposals for freer trade have been rebuffed;
That investment has been discouraged and unemployment has risen drastically;
That farmers and other primary producers have been disillusioned and discouraged;
That relations with provincial governments have deteriorated into confusion;
That the budget is no longer in balance, revenues are declining, expenditures are rising and parliament has been denied a national accounting;
That there is growing confusion about defence and security;
That day to day expedients have been substituted for firm and steady administration;
And in view of the desirability, at this time, of having a government pledged to implement Liberal policies;
His Excellency's advisers should, in the opinion of this house, submit their resignation forthwith.


John George Diefenbaker: Mr. Speaker, my first words must be words of congratulation to the leader of the official opposition in having discharged his

Suggested Resignation of Government
responsibility and made his first speech in this house; but they are not words of congratulation for courage, let me assure hon. members of that. Mr. Speaker, I listened to the Leader of the Opposition (Mr. Pearson) speak on the radio the other evening. I was imprisoned and it was an enforced listening but it was nonetheless interesting.


Lester Bowles Pearson: You could have turned it off.


John George Diefenbaker: It was the only program I could listen to and so I listened and heard the Leader of the Opposition make that speech which having regard to his speeches of the past I could only conclude was one he had not written himself.


Some hon. Members:: Shame. Cheap.


John George Diefenbaker: Mr. Speaker, I shall prove that a little later on.


Some hon. Members:: Do it now.


John George Diefenbaker: Wait and see. On Thursday there was shrieking defiance; on the following Monday there is shrinking indecision.


John Whitney Pickersgill: Who wrote that?


John George Diefenbaker: As I listened to my hon. friend I found myself looking back over the period of the last few months during which that once great party unanimously followed a policy of criticizing, condemning and calumnizing and then voting with the government. Over and over again they criticized us and then they emerged from their recent convention full of inspiration but lacking courage and now their leader moves a motion containing pusillanimous provisions and carefully designed to give the appearance that the government is afraid of a courageous stand-


Mr. Mcllrailh:: It is.


John George Diefenbaker: -and so worded as to assure that there is no possibility of this government being defeated.


Some hon. Members:: How do you know?


Mr. Speaker:: Order.


John George Diefenbaker: I would suggest to my hon. friends opposite that it is not so very long ago in the pipe-line debate when they sang a hymn-


George James McIlraith: Who debased the flag?


John George Diefenbaker: *-and I would suggest they recall that to mind now. It is so worded -and the truth hurts-that it is understood even by those who cannot understand, such
as the hon. member for Ottawa West (Mr. Mcllraith). Listen to the wording:
And in view of the desirability, at this time, of having a government pledged to implement Liberal policies;
His Excellency's advisers should, in the opinion of this house, submit their resignation forthwith.
The hon. member for Yukon (Mr. Nielsen) gave the answer today. There was a byelection in Lanark which gave the answer; there was a by-election in Wellington South which gave the answer. The only reason that this amendment is worded as it is is that my hon. friends opposite quake when they think of what will happen if an election comes.


Some hon. Members:: Call it.


John George Diefenbaker: I do not mind, but there was a day when noises such as that passed for argument but no longer. They worded the amendment as it is because they realize that there is no party in this house, other than themselves, that wants to see a government pledged to implement the Liberal policies forthwith. Oh, Mr. Speaker, I heard my hon. friend say in courageous tones, "Stand up or talk up". Today he talked up but they are afraid to stand up. He produced an amendment. Ordinarily the other parties are provided with a copy of the amendment at least when the speech begins. But let us take the various things, and I am not going to deal with them in detail.
Canada's total trade has ceased to expand.
That is not true.


Mr. Lesage:: Oh, yes.


John George Diefenbaker: Canada's trade has
expanded in the year 1957, over the previous year-


Some hon. Members:: For the first six months.


John George Diefenbaker: Mr. Speaker, will you please have at least some degree of order.


Some hon. Members:: Oh, oh.


Mr. Speaker:: I do not think either side of the house is entitled to call the other side names. There has been a great deal of enthusiasm displayed but I would ask hon. members to hear the speaker in silence so that he does not have to ask for order.


Lionel Chevrier: What about the speech of the Leader of the Opposition?


John George Diefenbaker: I mentioned a moment ago that Canada's total trade is expanding and has expanded. The amendment goes on to say:
Export markets have been threatened.
3522	HOUSE OF
Suggested Resignation of Government
I shall deal with that in a moment, but I shall leave the expansion of our arguments to my hon. friends, the ministers in question. The amendment says:
That investment has been discouraged and unemployment has risen drastically.


Some hon. Members:: True.


John George Diefenbaker: I intend to show when that started and that my hon. friends opposite were warned but did nothing.
My hon. friend said there are problems today that were not even contemplated last June. I intend to establish as clearly as the printed word will make possible that during the months of March, April, May until June 10, my hon. friends concealed from the Canadian people the facts. They know that. Oh, what crocodile tears are shed over the farmers. The amendment says:
That farmers and other primary producers have been disillusioned and discouraged.
My hon. friend says, look at our policies, look at what we have done. Well, I do not know to which policies he refers because I read this.


An hon. Member:: You have not any.


John George Diefenbaker: There was the greatest loss of resolutions. Somewhere between the brass and the grass the resolutions got lost. I will have to put my glasses on in order to see this fine print.
Scores of policy resolutions presented from the floor of the national Liberal convention this week vanished without trace.
Do you think it was the grass that took them away? I ask you, Mr. Speaker.
Proposals sponsored by provincial delegates or other groups were shunted to the 150-member resolutions committee for consideration.
They were lost, Mr. Speaker, because of the fact that the same group who have not realized yet that they were defeated on June 10 are still directing affairs.
My hon. friend says, "Look at the agricultural resolutions". I read them with interest, for almost every one of them-I can almost say every one of them-was voted against by the persons who today say they are good for the country. When they had the power, what did they do about a system of support prices except the sham and the caricature that was on the statute books? What did they do?


James Sinclair: Brought them in.


John George Diefenbaker: What did they do to assure the farmers a fair share of the national income? Whenever we moved a resolution to that effect they voted against it.


James Sinclair: What did you do on the C.C.F. resolution? You ducked to cover.


John George Diefenbaker: What did they do to encourage the production of marketable farm products? Listen to this:
Making available to grain producers not covered by the wheat board act a program of cash advances.
Before June last they said it could not be done. They said we would not be able to put cash advances on the statute books. They said cash advances were no good, they were no better than their loan plan. This afternoon my hon. friend used the expression, "Merely a loan, after all, without interest". They said it could not be done. They grudgingly supported it in the house. Now they come back, Mr. Speaker. Repentance is always worth while, even though it is in the face of impending disaster. I read on:
Assistance in setting up plans of accident compensation to the farmer.
What did they do in that regard in 22 years? They said it could not be done. I read on:
A policy of soil and water conservation.
Whenever a motion to that effect was made in the house they opposed it. I continue:
Extension of the principles of the P.F.R.A. to the whole of Canada.
Whenever that question was raised the answer given was that it was inappropriate. I go on.


James Sinclair: Tell us about the South Saskatchewan dam while you are on that subject.


John George Diefenbaker: Here is another good one:
Provision for accelerated depreciation on buildings constructed on farms for the storage of farm products.
Whenever we brought that matter before the house the party then in power, now sitting in opposition today, voted against it.


Mr. Gardiner:: Why didn't you do it in the
last seven months?


John George Diefenbaker: I continue:
Establishment of a joint federal-provincial agricultural advisory board which would investigate farm problems and recommend public policies.
They were 22 years in power but they never learned about it, Mr. Speaker, until the grass was permitted to look at the brass at the convention. This is just one of the examples, and I have taken it because it was referred to by my hon. friend. It is an example of a policy created because of their position of fear, realizing that they have not done the things that they ought to have done. They think the people of Canada will forget that these things that they now advocate on every opportunity that came to them they

Suggested Resignation of Government
voted against. Then, they say that relations with provincial governments have deteriorated. How did they deteriorate? They said one time that the provincial governments would get less if this party came into power. I said no.


John Whitney Pickersgill: They are getting nothing.


James Sinclair: Words, words, words.


George Clyde Nowlan: What is Nova Scotia getting?


John George Diefenbaker: My hon. friends say they are getting nothing.


John Whitney Pickersgill: That is true.


John George Diefenbaker: Well, let him say that in the maritime provinces.


John Whitney Pickersgill: They have not got anything yet.


John George Diefenbaker: We are giving every consideration to this matter, not to reduce amounts but to assure a reasonable opportunity for the provinces to carry into effect those policies which we have advocated, those things that come peculiarly within provincial and municipal jurisdiction, and our intention is do that thing at the earliest opportunity.


Jean Lesage: When is that?


John George Diefenbaker: "That the budget is no longer in balance"-that statement is simply a statement unsupported by facts-


James Sinclair: Because there is no budget.


John George Diefenbaker: -and simply generated in enthusiasm. "Revenues are declining, expenditures are rising, day to day expedients have been substituted for firm and steady administration." I would be less than frank if I did not tell you Mr. Speaker, that it is difficult to carry on a government with minority representation when my hon. friends of the official opposition criticize in the house, orate against what is introduced and then when the vote comes vote with us. It has been a sorry spectacle.


George Harris Hees: The once great Liberal party.


John George Diefenbaker: "And in view of the desirability at this time of having a government pledged to implement Liberal policies" Mr. Speaker, they are pretty frightened that they might have to undergo an election. Did you hear the explanations? They want the people to have more time to learn of what is happening in parliament. If the people do not know as a result of the conduct of the present opposition during the past three or four months, then that opposition has not been doing its duty.
The hon. gentleman says, "we do not want to vote out the government; all we want to
do is turn back the clock so that the people of Canada shall not have the right to say at this time who shall be the government in the next few years."
Mr. Speaker, I could not have believed that a great party would produce such a pusillanimous collection of criticism. If they believe what they say; if, as my hon. friend contended in stentorian tones, the majority of the people voted for them-


James Sinclair: He did not say that.


John George Diefenbaker: -what are they so
frightened about? They boast about that but that was not so in 1953. They had an overwhelming majority in the house even though they represented a minority of the Canadian people. No, Mr. Speaker, as far as this amendment is concerned it is simply designed to pretend, to pretend to stand up as my hon. friend spoke up. Have they any idea that any party in this house would want to see them beck in power?


Stanley Howard Knowles: plague on both your houses.


John George Diefenbaker: Mr. Speaker, I do not want to speak of this amendment in crushing terms, but there is no other expression that can be applied to it than this. It is the resignation from responsibility of a great party. It is a program designed in a spirit of resignation while at the same time pretending to the Canadian people that it is designed to be courageous. If my hon. friend were to tell you what is in his heart of hearts he would frankly admit that when this was drawn it represented a compromise between the fearless who have no regard to realities, who would like to have an election now, and the other more thoughtful ones who, having had the experience of sitting on the treasury benches, are afraid to challenge but want to appear valiant. Yes, Mr. Speaker, the resignation amendment of a party saturated with fear of what the electorate will do to it.
I was particularly impressed with my hon. friend when he said that the problems that face Canada today were not even contemplated last June. I shall be dealing with that in a moment in a record that cannot be denied. However, I think I should first make some reference to what this party has done under difficult circumstances. We have reduced taxes-


James Sinclair: How much?


John George Diefenbaker: -in order to stimulate-


James Sinclair: How much?


John George Diefenbaker: They say how much, Mr. Speaker.


James Sinclair: You promised $500 million.
3524	HOUSE OF
Suggested Resignation of Government


John George Diefenbaker: When we have the authority we shall do so.


Lionel Chevrier: Why don't you find out whether or not you have it?


John George Diefenbaker: We made $300 million available to swell the flow of funds into house building. The results have been most gratifying. Housing starts in municipalities having a population of 5,000 and over ranged between 70,000 and 80,000, seasonally adjusted, during the past summer. They rose by 92.4 per cent in October and the November figure was 217,000, the largest ever recorded for that month.
Across the way, Mr. Speaker, sit the purveyors of gloom who would endeavour, for political purposes, to panic the Canadian people at this time. One of the first things we did was to bring about amendments to the Unemployment Insurance Act in order to extend the period so as to put many millions of dollars into the hands of those who are unemployed who will need it this winter and spring and who have needed it in years past. We increased pensions and veterans allowances. We are endeavouring to bring in farm supports that will assure the Canadian farmer for the first time of that which over the years Canadian farm organizations have desired, namely a fair share of the national income.
We have also made provision that spending on public works shall be accelerated in order to stimulate employment. We brought into effect cash advances on farm-stored wheat. Let me say this. These prophesiers of doom said for political purposes that we would not be able to export wheat-we found difficulties; they had lost the markets-but in the month of November we exported more wheat than in November the year before.
In addition to that legislation on behalf of the maritimes in regard to the development of power we intend to provide as well special assistance to those provinces by the sea that are in need. We have done that in the face of an opposition-and I am speaking at the moment of the official opposition-which attacked everything, endeavoured to thwart by argument and then, with that same high courage that characterized this amendment today they spoke up but when the vote came they voted contrary to what they said.
My hon. friend says, "We have produced a wonderful platform". "Nothing has been done for the maritimes", said that pundit the hon. member for Bonavista-Twillingate (Mr. Pickersgill). What did Premier Matheson of


Prince Edward Island say? He arrived in Ottawa on January 13. On arrival in Ottawa he said this:
His party will seek a better deal for the maritimes from the Federal Liberal party.
What about the other deals they got from the Liberal party? Then he used these words, and you cannot call him a biased witness:
Prime Minister Diefenbaker is giving it to us so why can't the Liberals?
That is what the Liberal premier said. He said, "That is why the Liberals were defeated last June." From the mouths of those who know, Mr. Speaker, shall be quoted the truth. My friend the hon. member for Bonavista-Twillingate said, "What have they done for the maritimes?"


John Whitney Pickersgill: I did not say that.


John George Diefenbaker: My hon. friend, not understanding, cannot appreciate what Mr. Matheson said. He said:
That is why the Liberals were defeated last June. They did not give the maritimes half a deal.
I thought that should be on the record, Mr. Speaker.


John Whitney Pickersgill: Perhaps the hon. gentleman will permit a question since he has drawn me into the discussion. The question I should like to ask the Prime Minister is this. Why then did the government refuse the perfectly proper request of the premier of Newfoundland? That is all we discussed on this side of the house.


John George Diefenbaker: Why did my hon. friend, when he was in office, not do somehting for Newfoundland which saw him an orphan, without a seat, and took him in?
I do not want to cover the record thoroughly today-


John Whitney Pickersgill: I can understand that.


John George Diefenbaker: If that is one thing the hon. member can understand, it is the first thing he has understood since I have been in this house.
The question is asked as to what we did in the opposition in the months preceding the election. We warned the government that it was following a reckless course. We told them it was going contrary to the views of economists. As far as trade is concerned, we told them that it was diminishing because it was being lost. We told them that it was not acting in the first interests of Canada. After all, Canadian interests should come first.


An hon. Member:: Oh, oh.


John George Diefenbaker: My hon. friend says "no". That apparently is the policy of the opposition.


An hon. Member:: He did not say "No", he said "oh, oh".

Suggested Resignation of Government


John George Diefenbaker: We told them that the situation was very serious. We told them that to too great an extent they were putting the Canadian trade eggs into one basket. We told them that if the day ever came in the United States when anything in the nature of a recession or a pause should take place the consequences would be detrimental to Canada, for if there is one thing United States governments do when their people suffer, it is to act on behalf of their people.
I am not going to rehash what happened in 1921 when Canadian agricultural products were closed out of the United States nor what happened in June of 1930 when similar action was taken on the part of the United States. The same situation has been prevalent during the last few years. Look at the record of our exports to the United States in farm products. When any farm product in any way interferes with the United States people, the administration of the United States acts. We pointed out in the spring of this year that deflationary influences would be dominant during 1957. We warned that both labour and materials were moving into excess supply right down the line. What did they do, these paragons of political perfection in reverse? What did they do then? They know what to do today but what did they do then?
They based their government policy on the consideration that there was to be no end to the boom. They did not realize the situation or if they did so they concealed the facts from the Canadian people; and I think the latter is the better explanation as will be revealed as I quote from certain government documents. They continued their policy of a tremendous surplus on budget. They refused to consider the easing of tight money. They followed a course which we warned would lead to unemployment and to the destruction of trade.
My hon. friend says, "We did not know about these things; they did not exist in June last". May I point out that over and over again the former government were warned in these words, "Unemployment is increasing". Does my hon. friend the Leader of the Opposition say that he was not told that? Silence gives the answer, Mr. Speaker. They were told that unemployment was going to mount.


James Garfield Gardiner: That speech was made by Mr. Bennett in 1930.


John George Diefenbaker: I am going to read from a government document. In the first five months of 1957 unemployment was consistently higher than it was in the corresponding months in 1956.


Mr. Martin (Essex East):: Will the Prime Minister permit a question?


John George Diefenbaker: Yes.


Paul Joseph James Martin: Is he not aware that in the month of March the work force in Canada was at its highest peak in history?


John George Diefenbaker: Is my hon. friend not aware of the fact that the same situation prevailed all fall?


Paul Joseph James Martin: Oh, no.


George Harris Hees: Oh, yes.


James Sinclair: With 800,000 unemployed?


Mr. Speaker:: Order.


John George Diefenbaker: In March of 1957 those without jobs and seeking work were 6 per cent of the civilian working force compared to 5.3 per cent in 1956 and almost identical with the 6.1 per cent in 1951. The only time it was ever worse was during the recognized recession of 1955.


George James McIlraith: You speak like another Tory government.


Some hon. Members:: Oh, oh.


John George Diefenbaker: Mr. Speaker, that is about as intelligent an interruption as has ever come from that source in the past. It was only worse, with 7.4 per cent, in the recession winter of 1955 when those who today say they should be over here were in power. Early in 1957 unemployment was at practically the same percentage as it was in the difficult winter of 1954 and not far below the levels prevailing in the worst post-war winter of 1955. What did they do then?


Mr. Marler:: What did you say then?


John George Diefenbaker: What did the Liberals do; that is what I am asking. They simply said the condition did not exist. They continued their policy of tight money, failing to put into circulation the necessary money in order to help the house building industry in this country and thereby, in a measure, restore the lumber industry.


James Sinclair: House building was at a record of 137,000 units in that year.


John George Diefenbaker: My hon. friend does not have his records up to date and I would ask him to look at them again. In spite of this evidence and in spite of these warnings, those who today say they would like to be over here-they do not realize there was a June 10 -said their actions at that time had been taken to restrain a non-existent boom. They did not realize the bloom was coming oft the boom. They did not realize that deflationary forces had replaced inflationary ones as the dominating influence working in the economy of Canada.
3526	HOUSE OF
Suggested Resignation of Government
I said a moment ago that I was going to quote from the record. This record was in the possession of each and every minister in the former government. They knew the situation in March last unless they were like the hon. member for Bonavista-Twillingate who by his own admission a moment ago has never read it.


John Whitney Pickersgill: Never read what?


John George Diefenbaker: They went ahead with the policy which could not but accelerate the forces that were bringing about a deflationary condition in Canada. I am going to now read from this document in order to answer my hon. friend who the other night said "In June there was no problem of unemployment; our trade was at the highest level; we had an expanding economy."
Today one looks back and realizes that these men who were in power did not do that of which my hon. friend spoke in such colourful terms the other night. He said we must not conceal facts, but I put it to the hon. members opposite-every one of them in the official opposition-that they hid the facts; they concealed the record; they did not let the Canadian people know what was taking place.


James Sinclair: Like your budget?


John George Diefenbaker: You budgeted for a surplus when the economic situation clearly called for a balanced budget. You failed to reduce taxation. You failed to put money in circulation. What did you do to the old people of this country?


Some hon. Members:: Hear, hear.


John George Diefenbaker: You turned a deaf ear to the warnings of rising interest rates, strangling business activity and raising the costs. You turned a deaf ear to the requests to assist industries in difficulty to meet legitimate regional demands.
The result was a drastic reduction in house building and the lumber industry was placed in a position where it had lost those markets abroad which it previously enjoyed and at the same time was losing its market in Canada. You secured the advice of the economists in your own departments and were advised as to what the situation was in March 1957. This record was given to each and every one of you-


Lester Bowles Pearson: Mr. Speaker, may I ask the right hon. gentleman what he is reading from?


John George Diefenbaker: I thought the hon. gentleman knew of it before, but I am reading from the report "Canadian Economic Outlook" prepared by the economic branch of


the Department of Trade and Commerce delivered in March 1957 at a time when my hon. friends opposite were telling the Canadian people how well things were going and were refusing to act. I am now going to read from what the report recommended. It says some of the symptoms that typically are found in the latter stages of a cyclical expansion have begun to appear and such indications have tended to become more apparent since the turn of the year; more conficting tendencies in construction and manufacturing have entered and increases in unemployment in Canada since October have been much more than seasonal.
Regarding Canadian industry it says-at a time when Canadian industry needed help- that the competitive position of Canadian manufacturing has deteriorated markedly since 1950 with respect to both the United States and other major manufacturing countries. It says the most rapid period of deterioration was from 1950 to 1952 but a moderate further deterioration has taken place in the last 18 months.
After that warning what did they do? We have heard a great deal, of course, about the United States and about the money that has been invested by United States citizens. I have not seen any particular reduction in that excepting in the same proportion in which Americans are investing in their own industry today. In other words, there has been a very marked fall-away with which I intend to deal if I have time. In the United States in the period since January last this has been evident in the stock markets and in production; surpluses have been piling up and unemployment there has risen to the highest point in many years. Surely my hon. friends opposite, who tied Canada's economy to such a degree to that of the United States both with respect to our import and export business, must have expected that if an economic deterioration took place in the United States it would have its effect in Canada.
The report says later on that postwar developments are such that the inter-relations between Canadian and United States economies are even closer than previously and that exports to the United States have become a large part of total Canadian exports and have been larger in relation to total domestic output in recent years than in the 1920's. It also says that Canada had become more dependent on the United States as a source of imports of both merchandise and capital, and that underlying physical and psychological forces are both likely to ensure more similar rather than less similar developments for the two economies in the years immediately ahead.

Do my hon. friends say that this government is responsible for the fact that in the United States during the last eight or nine months there has been such a rapid deterioration in economic wellbeing as compared with the boom days? Do my hon. friends suggest, even though they thrive in endeavouring to fill the Canadian people with panic for political purposes-


Some hon. Members:: Oh, oh.


John George Diefenbaker: Do they suggest that the influence of the United States with its vast economy does not affect us here in Canada? Instead of being fair, instead of being reasonable, they who for 22 years provided the climate for this circumstance now have the effrontery to say to us that because conditions here-in common with what is happening the United States-are not as they were at the height of the boom, therefore this government is responsible.
They had a warning. They could not deny that they had this warning, clear and definite. What about this?
During 1956 the Canadian economy has begun to show some of the symptoms usually found only in the last stages of a cyclical expansion.
Did they tell us that? They were warned what would happen.
Increases in demand in exports and investment have begun to moderate and this is likely to become more apparent during the coming years.
That was in March, 1957; the economists whom they chose to study these matters forecast that later on in the year investment from the United States would begin to moderate.
It has become apparent that after increasing more rapidly than in the United States in the first half of the year the rate of increase definitely slackened and was slower than in the United States since July. These tendencies, tentative and incomplete as they admittedly are, suggest that more caution on the outlook is appropriate at this time.
What action did the government take with regard to any of these matters. Parliament was sitting. But they did nothing during the session to bring about changes in legislation to meet the situation of which they had been warned,
What about wheat? What about lumber products?
Declines in some lumber products have begun and further drops in sales to both United States and overseas markets are likely. Return to a normal European grain crop and continued competition from the United States are likely to result in a drop in grain exports, particularly wheat.
That is what they were told in March. And what did the government do? They said: everything is fine, we are in power, so all is well. They kept it from the Canadian people.
Suggested Resignation of Government Let me go on. What about commercial and industrial construction? This is what the report says:
Contract awards for commercial and industrial construction are no longer expanding and during some of the later months of 1956, total non-residential contract awards ran below the previous year. The investment survey for 1957 also suggests a slower increase, and this does not appear to be solely a result of physical limitations.
What about housing? The report says:
The decline in activity in the current winter (1956-57) will be much more than seasonal, and a drop in volume of roughly one-fifth has been allowed for in the estimates.
Mr. Speaker, let those who will know the truth read this report. Then, further, and I quote:
There are indications that new business projects were being initiated at a somewhat slower rate during the latter part of last year, and this tendency is likely to continue.
Mr. Speaker, through their own mouths- through the mouths of their departmental officials-comes the truth. We were on the slide, really on the slide, when they left power on June 21, and now, for political purposes, having concealed this document, they have the effrontery to pretend to the Canadian people that we are responsible. The Leader of the Opposition has mentioned investment. What did the economics branch of the Department of Trade and Commerce say in March of 1957?
It is certainly clear that the general stimulus to investment that was present during the two previous years will not be present during 1957, and declines in housing may be of a magnitude to offset increases elsewhere in some individual quarters of the current year.
Then, in connection with defence there is a reference that will be dealt with later. On page 4 it mentions that there will be drops in sales in the United States and overseas for wheat-no, that is on page 3-and lumber, but the general stimulus to trade is retarding. But there is time for action. And then it says:
At the federal level, further declines in defence procurement expenditures will more than offset increased expenditures on both civilian and military personnel.
The report continues:
Consumer expenditure is currently a somewhat smaller share of both gross national product and gross available supply.
After which the report sums up the situation with regard to income:
Profits in some important sectors were lower than in the same quarter of the previous year. Year-to-year declines had developed in textile products, electrical apparatus and supplies, non-metallic mineral products, chemical products and other manufacturing industries. Declines in profit margins had occurred in a further group of manufacturing industries, such as foods and beverages, rubber products, wood and paper products, iron and steel
3528	HOUSE OF
Suggested Resignation of Government
products, and products of petroleum and coal. Profit margins in total manufacturing were lower than the year before. The only manufacturing industry with higher profit margins and total profits in the third quarter of 1956 than in the same period the previous year, was non-ferrous metal products. In the light of changes since last fall in prices, costs, and the exchange rate, some weakening in this industry (apart from nickel) has clearly developed since last fall.
Why did hon. members opposite, in the idealistic vein of the hon. Leader of the Opposition, not reveal these facts? Why did they not act on them, even if they did not think fit to reveal them? Did they not know a major decline was coming? They were told so by the economists.
No renewed strengths in corporate profits are expected under the circumstances envisaged here for 1957. Any further easing in demand pressures during the year will he reflected in declines in profits, traditionally a volatile category, and a decline of 5 per cent in corporate profits is allowed for in the estimates and the possibility of a more pronounced decline cannot be ruled out.
Mr. Speaker, why did they not reveal this? Why did they not act when the house was sitting in January, February, March and April? They had the information.
What about agriculture? Oh, I see that when another resolution was passed by the convention they spoke most feelingly about agriculture. But what did they do? What about wheat markets? What about the accumulation of wheat? What of the failure to secure, a few years earlier, the inclusion of Britain in the international wheat agreement due to a stubborn intransigence on the part of the then government with regard to reducing by five cents the maximum price allowed under that agreement. They have never got into the agreement since. That opportunity was lost because the former government, after 22 years in power, had developed, in their own opinion, a divine right to rule; the idea that regardless of what the people might think they could do as they wished and still be returned to power. What does this report say of agriculture?
The lower level of exports anticipated is likely to result in a decline in cash income in the prairies again.
Warned in March of 1957, what did they do to meet that? Silence gives the answer. I turn now to the summary which I think tells the whole story. It reveals what I have been trying to convey to you, Mr. Speaker, and through you to the people of Canada. My hon. friends opposite are resolute in irresolution-


George Carlyle Marler: That is an old chestnut.


John George Diefenbaker: -pretending to discharge the responsibilities of an opposition by moving an amendment which they know will not


be supported. Talking loudly, but having themselves concealed and having never revealed the situation as it was, they now try to build an election campaign, which they do not want now because they have not educated the people yet. They had the warning. The summary reads:
In summary, a definite easing in demand pressures for goods, services and labour is indicated for 1957. Increases in exports and investments will be much more moderate, and inventory investment will decline. This easing in demand would be reflected in much smaller physical changes than what have occurred over the two preceding years. Continued higher price indexes for domestic output can still be expected, however. The increases in gross national product in the fourth quarter of last year is expected to be the smallest in some time and the change in the current quarter will be even less (even apart from reversion to a normal crop assumption which is necessary at this time).
And a little further on its reads:
Any general declines should be recognized fairly quickly as they occur, even if the timing of a weakening cannot be forecast in advance with any assurance with the tools available.
Then they speak of oil and how great the markets were in 1956 following the action taken by Nasser in the fall of 1955 which brought about greatly increased demands for oil from elsewhere and also increased demands for industrial and raw materials. The report says:
On the other hand, prices of industrial raw materials in world markets have undergone more conflcting tendencies and this had reached the stage of general weakness until the Suez crisis introduced a period of temporary strength.
They take the period of temporary strength brought about by the Suez situation as something upon which to delude the Canadian people into thinking that they did not realize that economic conditions were such that it would not be long delayed before serious repercussions would take place. Were they warned? Here are some further words:
Furthermore, developments in the underlying price and production pattern reflect most of the tendencies found only in the later stages of a boom.
And so I could continue in this vein. They were on the slide and they failed to act and now, having failed to listen, to stop and to act, they moved an amendment which contains many high sounding words of challenge that they know very well, with the additional paragraph included, the other parties would not accept. The other parties would not want them back. They placed those words in that amendment in order to cover up their lack of courage in an attempt to challenge this government.
What about industry? The report reads:
Over-all production and employment in Canada increased fairly steadily from the lows reached in the minor cyclical contraction through to the middle of 1956. Since then, the rates of change have clearly become much more moderate.

Further on it states:
The commodity producing industries and transportation were beginning to reflect more crosscurrents and conflicting tendencies. Some sectors of mining (apart from petroleum) were showing weakening tendencies, as were some of the components of manufacturing. Roughly half of the component industries in the index of industrial production were declining through much of the latter part of last year.
That would be the year 1956. Is there anyone who will tell me that the present situation is not directly attributable to the failure of the former government to realize that the economists had pointed out the terrible danger that faced Canada's economy. And having it pointed out they thought they would have an election and, in having an election, would wait things out.
Now, what about unemployment? The report reads: :
Since October, the levels of persons without jobs and seeking work and unplaced applicants have undergone increases that are clearly greater than seasonal.
Did they tell us that? No. Today, we give regular reports as to the unemployment situation.


James Sinclair: When the information is dragged out of you.


John George Diefenbaker: Did they give us such information? They had it in the report but they did not give it to parliament. The report continues:
The percentage increases from October to date-
That would be February or March-
-have been greater for both series than what took place over the same period in the winter of 1953-54.
We had terrible unemployment at that time.


James Sinclair: It was just half what it is today.


John George Diefenbaker: Yes, because you people did not act. That is the point I am making. My Friend the hon. member for Coast-Capilano (Mr. Sinclair) pays us high tribute when he expects us to undo in six months what his party did in 22 years.


James Sinclair: You have done it in six months.


John George Diefenbaker: I repeat:
Since October, the levels of persons without jobs and seeking work and unplaced applicants have undergone increases that are clearly greater than seasonal. The percentage increases from October to date have been greater for both series than what took place over the same period in the winter of 1953-54.
Out of the recent Liberal convention have come resolutions as to what should be done in
Suggested Resignation of Government terms of public investment, the building program that should be commenced and concerning what assistance should be given in order to meet this serious problem of unemployment; yet none of these things were done when they were in power. They accentuated, emphasized and increased the dangers that prevail in Canada as a result of their tight money policy that throttled small industry, in this country. The report continues:
It is worth noting that this tendency-
The percentage increases.
-towards smaller increases in production and employment cannot be attributed to over-all shortages of either labour or materials.
Then it states:
A higher level of immigration is expected to continue during 1957, increasing the supply of labour from this source (as well as the associated stimulus to domestic demand from immigration).
They were told that; they had warning. Certainly in the cold shades of opposition they have developed a power of perception that was not theirs when they sat in warm comfort on the government benches. The report continues:
The more moderate increase in demand expected for 1957 will be reflected in a smaller increase in the demand for labour.
No wonder that several at that convention said, "The defeat did us some good". It certainly did the people of Canada a lot of good. I continue:
Less pressure on the labour market will be reflected in more moderate changes in participation rates and movement off the farm than were apparent in the earlier part of the expansion. Even with these adaptations to changing circumstances, a higher average level of without jobs and seeking work seems likely in 1957 than during 1956.
I do not intend today, although I hope I have an opportunity before this debate concludes, to deal with one or two other phases. All I am setting out to do is to point out the degree to which in an unsatisfiable desire to secure power, a once great party would endeavour to panic the Canadian people into fear for the paltry purpose of being returned to power, provided that the people will believe that they are going to be any better now than they were when they did not take action in 1956 and 1957. The Leader of the Opposition said that the increase in unemployment is faster now than it was at any time since statistics were kept.


Paul Joseph James Martin: Since 1933.


John George Diefenbaker: What did the report of the economist to the then government say?
The changes since October have been the most rapid that have taken place in the postwar period.
3530	HOUSE OF
Suggested Resignation of Government
That was October, 1956. What did he do to meet it?


Paul Joseph James Martin: We are talking about this fall.


John George Diefenbaker: What did you do to meet it in order to stop that slide?


Paul Joseph James Martin: We did not say
we would cure unemployment.


John George Diefenbaker: You concealed the facts. That is what you did. Then, it says this, and I am paraphrasing here until I start to quote again so I will not be repeating. The rate of increase since October, 1956 has been a much sharper percentage increase than during the winter of 1953 and 1954. My hon. friends will give the figures as to numbers seeking jobs and the number unemployed. I say to my hon. friends opposite, why did you not do something? When did you suddenly develop the fear and the realization that conditions were bad? When did your hearts start to bleed for those poor people who are unemployed? I know what it means. Why did you not act? My friends, you could not delude the people of Canada last June. Whenever the election comes I am sure they will not be deluded by that type of argument. But the next line is even more pertinent.
This is a disquieting pattern and will warrant attention in the winter months.
What plans did you make? Where was that shelf of works of 1945 that was going to be made available whenever conditions should deteriorate? What did you do with the shelf, put in under the table?


James Sinclair: We carried it out, the St. Lawrence seaway, the Canso causeway, the trans-Canada highway.


John George Diefenbaker: When we came into power and looked for the so-called shelf there was not one solitary suggestion of a program available to meet the situation.
I am not going to speak much longer, I am just dealing with this one phase because I think it reveals the utter sham of this caricature of an amendment. Listen to this: My hon. friends who were then in the government did not listen. My hon. friends who have the solutions now were sitting over here. What did they do? They concealed the facts. They told the Canadian people that all was well; Utopia is here; there will be no more unemployment. What did the economist say?
This is a disquieting pattern and will warrant continuing attention in the winter months. With a situation changing as rapidly as this in a four-month period, it is somewhat difficult to suggest the pattern for the full year with any degree of assurance. It now seems clear that the winter peak will be above the same period of last year.


Did you tell anybody that?


John Whitney Pickersgill: The figures were published.


James Sinclair: Every month.


John George Diefenbaker: Oh, the figures were published and the warnings were concealed. Oh, yes. Apparently those who read could not understand because we pointed out the situation.
My hon. friend, the Leader of the Opposition said that they had no unemployment on June 10. The largest unemployment in Canada in the month of June existed last June.


Lester Bowles Pearson: I never said any such thing.


John George Diefenbaker: The number seeking work at that time was 245,000. Warnings were everywhere but what action was taken?


James Sinclair: Today there are 800,000 unemployed.


John George Diefenbaker: Because you did not take any action when you were in power. They did not take any action.


James Sinclair: It has tripled in seven
months.


John Whitney Pickersgill: It has tripled in seven months.


John George Diefenbaker: My hon. friend has a way of making his best contribution when seated.


John Whitney Pickersgill: I could return that
compliment.


John George Diefenbaker: I know how this hurts the finer sensibilities of those who have guilty consciences.


Stanley Howard Knowles: Will the Prime Minister permit a question?


John George Diefenbaker: It now seems clear that my hon. friend will have an opportunity of joining, because after all he is in the position of being in a party which has been described as a party of Liberals in a hurry. No doubt that is one of the reasons why the official opposition expect the support of the members of the C.C.F.


Stanley Howard Knowles: The Prime Minister did not hear my question. Has this document which the Liberals concealed been tabled? If not, will the Prime Minister table it so we can all see it?


John George Diefenbaker: I do not know that it has been. I would take it that it has, surely. If it has not been tabled my hon. friend has added one more example to the record of concealment by my hon. friends opposite.

Suggested Resignation of Government


Stanley Howard Knowles: Mr. Speaker, I asked the Prime Minister whether this document which he says the Liberals concealed has been tabled by the present government?


James Sinclair: The answer is no.


Stanley Howard Knowles: It not, will he table it. He cannot accuse me of concealing it. It was not a report to me.


James Sinclair: We cannot tell what is the report and what is not.


John George Diefenbaker: As a matter of fact, Mr. Speaker, it was hidden away so well we just found it.


Stanley Howard Knowles: I rise on a point of order, Mr. Speaker. In accordance with citation 277 of Beauchesne's Parliamentary Rules and Forms, third edition, I am sure that the Prime Minister will now be willing to table this document to which he has made such lengthy references.


John George Diefenbaker: If the house desires it I will be very happy to do so.


Paul Joseph James Martin: You must.


John George Diefenbaker: I rather welcome that suggestion. I could not have tabled it unless my friend requested it.


Lionel Chevrier: Nonsense.


Stanley Howard Knowles: Now we are both satisfied.


John George Diefenbaker: I am sure there are other copies. I shall secure a copy of this later this evening.
My copy is marked up. I will secure a copy if the house wishes to have it tabled, as I am sure it will having regard to the reception given to the request of the hon. member for Winnipeg North Centre (Mr. Knowles). I think I have pretty well covered the references in general, perhaps more than I would like to, but I have always found that if you want to know the truth you have to look at the record. I looked at the record and I am very happy to make the entire record available so that those who desire, even my hon. friends opposite who paid no attention to it-


George James McIlraith: On a point of order, Mr. Speaker-


John George Diefenbaker: -will be able-


George James McIlraith: On a point of order, Mr. Speaker, I would ask that the paper be tabled now. In support of that request I would refer you to the language used in the third edition of Beauchesne's Parliamentary Rules and Forms where I find the following:
A minister of the crown is not at liberty to read or quote from a dispatch or other state paper-


Mr. Speaker:: Would the hon. member indicate what page he is reading from?


George James McIlraith: Citation 277, page 110, at the bottom of the page.


John George Diefenbaker: Mr. Speaker, you can make a ruling if you want to.


Some hon. Members:: Sit down!


George James McIlraith: The particular reference to which I should like to draw Your Honour's attention reads this way:
A minister of the crown is not at liberty to read or quote from a dispatch or other state paper not before the house, unless he be prepared to lay it upon the table.


An hon. Member:: He said he would.


George James McIlraith: My point of order is this, Mr. Speaker.


Mr. Speaker:: Order. I am sorry but I cannot hear the hon. member's point of order.


George James McIlraith: My point of order is this,
Mr. Speaker. The Prime Minister has read at great length this afternoon from a document in his possession. When he is now asked to table it he says he cannot do so but he will get a copy later and table it.


John George Diefenbaker: No, no.


George James McIlraith: Apparently hon. members opposite are not concerned with the procedure of the house. My point is-


Mr. Speaker:: Order. I am sorry, I have not heard the hon. member's point fully yet. If the hon. member will continue, perhaps I will hear what it is.


George James McIlraith: My point of order is that we are now entitled to the document and that the Prime Minister is not entitled to say that he will table it later. We are entitled to see the document now.


Mr. Speaker:: I understood the Prime Minister to say that he was prepared to table a copy later. Is the Prime Minister prepared to table a copy at the close of his remarks?


John George Diefenbaker: I am certainly willing to table it.


Mr. Speaker:: At the close of his remarks.


George James McIlraith: That would be satisfactory.


John George Diefenbaker: My hon. friend is arguing something that I am not contending against at all. You can always be very successful in that kind of argument. I shall be very happy to table it on conclusion. I will even give the marked copy.


Lester Bowles Pearson: It is marked alright.


John George Diefenbaker: Mr. Speaker, it is approaching six o'clock and I come to one other

Suggested Resignation of Government observation in connection with the United States. The United States has suffered from the same type of recession and I have the details here from yesterday's New York Herald Tribune and New York Times. I intend to put the details on the record as to the amount of unemployment, the receding stock market and the loss of investment opportunities because money is becoming tight under the current situation. These economists even warned about this and used these words:
It should be noted that any weakening in the North American economy would be reflected in a decline in the balance of payments deficit . . . More moderate changes in the United States economy, to which Canada is so closely related, could reduce the incentive for continued high rates of foreign investment in Canada, even if the easing in demand was only temporary. Such a development would probably lead to some slackening in the rate of capital inflow.
My hon. friends are charging us with reducing the amount of investment in Canada, which they cannot, of course, bear out by statistics. But if that were so they were warned because these economists said that our two economies are so related that it will be expected to reduce the incentive for a continued high rate of foreign investment in Canada and that such a development would probably lead to some slackening in the rate of capital inflow.
There, Mr. Speaker, is the story. There is the warning. There is the answer. I do not know what my friends expected. Did they believe that following the enthusiasm of a recent event they could join together, construct this dilapidated annex of an amendment and delude the Canadian people when they themselves knew what was coming or- and I want to be fair to them-did not know and paid no heed because they had not read it?
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
John George Diefenbaker: Mr. Speaker, at the adjournment I had referred to the fact that in the hidden report there was a reference to the fact that if conditions in the United States deteriorated Canada would be affected. I have made a reference to the changes that are taking place in the United States and, for the purpose of the record, I will place thereon the stock market trends in the United States between January, 1957 and December, 1957. In January, 1957, the composite index was 338.2 It rose in April to 338.6, in May to 352.2; in June to 354.6, and in July to 361.8. That was the high point. The effect

on the stock market following that is indicated by the following statistics which reveal that, in so far as investment income is concerned, the high point came early in July or in the month of July, following which there was a pronounced depreciation in the index figures as follows: August 343.2; September 327.9; October, 306.4; November, 301.8 and December, up to December 27, 294.5. That indicates a tremendous falling away particularly during the period between June and July of this year and the end of the year.
I also had referred to the fact that the economic situation in the United States- and I am sure my hon. friends do not blame us for that-was set out yesterday in the New York Times. It deals in general with the situation. It says:
The federal reserve's index of industrial production in December fell to 136 per cent of the 1947-49 average, a drop of 3 points in the month and 11 points from the record peak of December, 1956. Personal income was down $2.5 billion to an annual rate of $343 billion. Meanwhile, unemployment rose to 3,374,000 in mid-December, an increase of nearly 200,000 in a month.
Other adverse industrial news last week included: the continuing lag in railroad freight traffic (down 16.4 per cent in the latest week from a year ago); further shut-downs of automobile assembly plants and the continued lag of car production (down about 20 per cent so far this year compared with 1957).
We took a step forward in that regard by reducing the excise tax on automobiles by 25 per cent in order to remedy a similar situation in Canada.


James Sinclair: Instead of abolishing it as you promised.


John George Diefenbaker: I do not want to become involved in promises, Mr. Speaker, because I have here the 1948 Liberal convention promises and also the 1919 ones.


George Carlyle Marler: Have you the Conservative ones in 1956?


John George Diefenbaker: If I start to deal with promises, it is going to be an interminable process. It is going to be a repetition of what happened this afternoon. To continue:
Steel production last week was 38 per cent below a year ago; copper prices fell 2 cents a pound to 25 cents, the lowest level in almost five years, as demand continued slow; a major aluminum producer is cutting output sharply owing to market surpluses.
That is the situation in the United States of America which, according to the hidden report, would affect the Canadian situation. I ask simply this question. Are we responsible for the falling of the stock market in the United States? Are we responsible for the fact that the largest industries in the United States are cutting down their capital

Suggested Resignation of Government
production? Are we responsible for the fact that United States investment has been reduced in the last few weeks, starting back in July, to an extent that could not have been expected a few months ago?
Let me read now from the New York Herald-Tribune of yesterday . It says:
Unemployment rose by 186,000 to 3,374,000 between mid-November and mid-December. Aluminum Company of America has halted work on three projects temporarily in its $100 million expansion program as current demand is not absorbing all production of its present facilities. Socony Mobile Oil Company has rescinded a recent price increase for heating oils along the Atlantic coast because other marketeers failed to follow. Rail freight traffic is steadily declining, compouding the woes of impoverished eastern carriers who raised the specter of bankruptcy for some of the railroads unless congress heeds their plea for legislative aid. Industrial production declined in December for the fourth straight month as did personal income.
Surely, Mr. Speaker, there is a degree of fairness even in politics, and there should not be an endeavour to lead the Canadian people to believe that our situation is something that was brought about as a result of this government when in point of fact those who sit opposite in the official opposition refused to realize the tremendous danger to the Canadian economy in placing our trade, as I said this afternoon, in one particular locality. What did they do? I am going to deal with the adverse balance in just a moment because my friend the Leader of the Opposition, speaking in B.C.,-that is "Before Convention"-made a speech in the city of San Francisco just a few days after the election.
I	think the house will find it intensely interesting, revealing as it does in grandiloquent language the serious situation faced by Canada.
In so far as the general business index in the United States is concerned there were reports yesterday that it was 170.8 on January
II	against 172.7 on January 4 and 197 on January 12, 1957. The only ones you would expect to gloat over this situation would be Khrushchev and Bulganin who through the years have been predicting what would happen to the free enterprise system, but it surprises me that a matter so serious as this, with men and women out of work as a result of conditions over which this government has no control-


Mr. Protidfool:: Tory times are hard times.


James Sinclair: Stamping on the toes of our best customers.


John George Diefenbaker: We have taken certain steps and we intend to take further steps to give assistance of the type-


Some hon. Members:: Oh, oh.


Mr. Speaker:: May I remind hon. members that there will be an opportunity to reply later.


James Sinclair: We will take it.


Douglas Scott Harkness: You hate to hear the truth.


John Hugh Proudfoot: No-but you cannot take it.


John George Diefenbaker: That is the squawk of one who can.
Mr. Speaker, if I might proceed with the statistics I have been placing before the house, in order to have the record quite clear I now intend to deal with the Dow Jones stock market prices, month by month since January, 1957. In that month the level was 498.2; it rose on May 17 to 505.6 and it fell away on May 24 to 504. It rose again on January 14 to 511.8 and on the day we came into power the level was 500. It is now at 444.6, a continual reduction throughout those months.
In respect to railroads they were at 156.4 in January, 1957, according to the record of stock market prices and they have continued down the road throughout the year until at the end of December the figure was 97.4


An hon. Member:: Tory times are depression times.


John George Diefenbaker: There was an increase however on January 3 to the level of 103.5 but still they are 53 points down. I wonder, Mr. Speaker, whether we could proceed without the truth hurting so much.
The only field in which there has not been that trend is in the utilities field where the level on January 4, 1957 was 69.1 per cent; it rose in June on the day we came into power to 76.4 and it is now 69.5; very little lower than at the beginning of the year. I want this clearly on the record. All of this proves just one thing, that we on the North American continent are experiencing a situation which is not a cause for jubilation.


Some hon. Members:: Hear, hear.


John George Diefenbaker: It is one for serious consideration and when my hon. friends say the way to solve it or to fix it is to move us over-


Some hon. Members:: Hear, hear.


John George Diefenbaker: I think of the fact that the hidden book reveals that they did nothing. I am not making an overstatement when I say that to meet the situation which was apparent and in respect of which they were warned and which today they have endeavoured to take advantage of because of their own failure to act-


Douglas Scott Harkness: They are proven failures but they have not realized it yet.
3534	HOUSE OF
Suggested Resignation of Government


Stanley Howard Knowles: Would the Prime Minister permit a question?


John George Diefenbaker: Yes.


Stanley Howard Knowles: My
question relates to the document to which he has just made reference once more and which he was kind enough to table as the house rose at six o'clock. In view of the fact that to those of us who have now seen that document it is apparent that it was a confidential document-


Paul Joseph James Martin: A cabinet
document.
Mr. Knov/les (Winnipeg Norlh Centre):
-prepared for the cabinet just prior to the presentation of the budget, will the Prime Minister say whether any similar reports have been made to the government since that time and, if so, will he also make those reports public?


John George Diefenbaker: The hon. member has remarked that this is a confidential document by its nature and I expected that question.


James Sinclair: Oh yes.


John George Diefenbaker: It is of a confidential nature and it has to do with events immediately ahead in the economic field and for that reason documents of such a type have naturally not been tabled in the past. This, of course, is because if there is going to be a rising economy according to such a document then that encourages business interests but if it says that in a certain area there is going to be a reducing economy then that inevitably would have a detrimental effect.
However, the point I made was that they did have that document and they did not act upon it but, instead of acting upon it, they actually placed before the House of Commons at the time of the budget a picture of a buoyant economy, hopeful for the future-


An hon. Member:: We were scuttled.


John George Diefenbaker: -and assured the country that it would be continuing as they said it was.


Stanley Howard Knowles: Has
the Prime Minister any similar document or documents now?


John George Diefenbaker: I have answered the question.


Stanley Howard Knowles: Have you any similar documents?


Lester Bowles Pearson: Hidden documents.


Donald Ferguson Brown: Give the hon. member the advice he asked for.


John George Diefenbaker: I wish to turn to a certain matter and I waited until my hon. friend


was in the chamber as I knew he was appearing on the national hookup of television this evening. I was dealing with generalities until his return to the chamber because I thought it only fair that he should be present when I referred to the speech which he made the other night as well as an earlier one.
We in this party have endeavoured to expand trade.


Donald Ferguson Brown: Where?


John George Diefenbaker: We have gone about it-


James Sinclair: By stamping on the toes of our best customers; that is the way you have gone about it.


An hon. Member:: Oh, no it is not.


John George Diefenbaker: It is apparent that the hon. gentleman who is the former minister of fisheries has not read the speech of his leader. I wonder, Mr. Speaker, whether these casual and entertaining interruptions might be discontinued-


Some hon. Members:: It is one of your own; make him stop.


Mr. Gauthier (Portneuf):: They are speaking out of turn; they are not properly trained yet.


Mr. Speaker:: This is perhaps an unusual day. Nevertheless I cannot recognize hon. members if they do not rise in their places when they endeavour to make their points, and I would ask them if they wish to speak, to do so on a point of order or by some other proper means.


John George Diefenbaker: If I may add this, far the moment, Mr. Speaker, I misplaced this clipping. He apparently did not listen to one of his former colleagues speaking at the coliseum on Thursday. What did the former associate minister for defence say? The hon. gentleman ought to start teaching him. He said:
Canada should go along with the United States 100 per cent on mutual defence, but we should get tough.
Mr. Hellyer is one who has apparently learned. He is apparently one of the nine who did not come back. He went on:
We should get tough and ask the United States to buy much more goods from us than they do now.
That is exactly the present condition of affairs. I am not saying we could get tough, but that is the recommendation, and this is the best answer to the right hon. gentleman.


James Sinclair: The answer you got was 15 per cent on oil.


John George Diefenbaker: As far as the oil situation is concerned, the hon. gentleman knows as well as I do that during the Suez crisis it became necessary to develop oil supplies from

other parts of the world. Certain parts of the United States were closed to the oil, but the Pacific coast district was open. On the reopening of the Suez canal far earlier than the date which was expected the United States found itself in a position where, it is claimed, it will be inundated with oil, and instead of having a broken market-a depressed market-and a fall in prices that will be economically detrimental to the producers of the world, the only solution-this is their explanation-is the one they have adopted. We do not accept that, but that is the explanation of the United States. They intended to go even further, as I understand it, but we made representations, and what hon. members opposite fear is that in the last few days, having regard to the response given to that complaint on the part of the United States, there is at least a qualified prospect that the United States is going to reconsider the matter.
But here something that I cannot understand the Leader of the Opposition saying:
I must say that I do not believe we increase confidence in Canada by attacking our triends in other countries. Those who previously criticized us for not-as they put it-standing up to the Americans are now discovering that talking up is not the same as standing up.
I will deal in a moment with the way in which hon. gentlemen opposite have stood up. They stood up much as they intend to stand up for the amendment they moved today. Then the hon. Leader of the Opposition said this, and this is something I think he will regret:
Even when they merely talk up they have been slapped down.


James Sinclair: "We fixed them".


John George Diefenbaker: The hon. gentleman is the leader of a great party, but he made that statement, and I find it difficult to understand that a Canadian should gloat over the refusal of a foreign government to consider Canada's representations. I ask hon. members opposite what they did. They say today: "Do not let us take a stand as Canadians on behalf of our rights; let us go in by the back door in Washington; let us not stand up for our rights, even though not in a threatening and not in a truculent way." But as far as Canada is concerned we cannot maintain our integrity with the type of adverse balance in trade which has been increasing year by year.
The United States embarked on their giveaway program while the former Liberal government was in power. What happened? They wrote a couple of notes and when we asked in this house for the production of those notes, the then minister of trade and commerce said: we will not produce them.
Suggested Resignation of Government Then we asked what replies he got, and he said: they were not written in such a way or couched in such terms as to admit of a reply.
I ask hon. gentlemen opposite this: when they were in office do they remember that the United States imposed quotas on Canadian rye, dairy products, clover, seed potatoes, oats and barley? That is the picture. And when anyone says to me that we are being fairly treated, as the hon. Leader of the Opposition does, I simply ask him to read the United States papers. I spoke on this subject at Dartmouth University and I was amazed by the fact that from all over the United States letters were sent to me saying that Canada had a legitimate grievance; that we were placed in a position where the United States exploited our raw materials and our semimanufactured goods while at the same time closing out, generally speaking, our agricultural exports to the United States.
I propose to read part of a short summary of an article which appeared in Barrons magazine on December 30, 1957. It is entitled: "United States must End Economic Warfare Against Canada." It reads:
The United States in short has showered down good will upon the four corners of the earth. Closer to home, however-virtually in its own backyard- it has chosen to behave in contrary fashion. In particular, in terms of trade policy this country long has acted badly toward the Dominion of Canada. Heedless of damage to the wheat growers of Manitoba, the administration has sanctioned the dumping of domestic surpluses on the world market. Similarly, it has confronted the Canadian mining industries with the threat of higher tariffs on non-ferrous metals. Finally, over the strenuous protests of Ottawa-and in violation of its own commitments-Washington last week decreed the extension of "voluntary" quotas on foreign oil, including Canadian crude, to the west coast. Such moves undoubtedly have pleased, if not appeased, various special interests at home.
The article goes on:
Canada has deserved well of this country. Instead somehow it has become a favourite whipping boy of various United States agencies and interests. Several years ago, for example, customs authorities reclassified Canadian ping pong balls as ammunition-they can be used in pop guns-thereby raising the duty on them nine-fold.
Then the article goes on to discuss the picture generally. Anyone may read this article who wishes to do so. It finally ends with the warning that such conditions cannot be allowed to continue.
I wish to make a special appeal at this time. The President of the United States in his message to congress linked trade with defence. That his message last week, the week of the eleventh. He put his foreign economic program in dramatic perspective last week as essential for countering the Russian total cold war. I think that that was a
3536	HOUSE OF
Suggested Resignation of Government very proper view to hold, because, Mr. Speaker, let us not gloat over the economic difficulties of any nation in the free world.
The major challenge today of the U.S.S.R. is on the economic front. We do not make our contribution to the preservation of freedom by endeavouring to play ball favourably to ourselves in the matter of unemployment and the world trade situation particularly in the free world. Indeed, I point out to the United States once more that in the exchange of notes in 1950 recognized by both the government of Canada and the government of the United States as being in effect an agreement was made in the following language:
It Is agreed that our two governments shall cooperate In all respects practicable, and to the extent of their respective executive powers to the end that the economic efforts of the two countries be co-ordinated for the common defence and that the production and resources of both countries be used for the best combined results.
I say that interfering has occurred as a result of the embargo on oil and that the threatened action in so far as non-ferrous metals are concerned is something that must be reconsidered because an agreement was reached at the NATO conference in the following words which are not shallow words:
We will co-operate among ourselves with other free governments to further the achievement of economic stability, a steady rate of economic growth, and the expansion of international trade through a further reduction of exchange and trade barriers.
We recognize the interdependence of the economies of the members of NATO and of the other countries of the free world.
If that is recognized then I say that economic action taken at this time to interfere with those things that are of the essence, with the United States being a have-not nation to a greater or lesser degree with respect to non-ferrous metals, is something that in the interests of our survival in the free world deserves the most serious consideration on the part of the administration and the congress of the United States.
My hon. friend the Leader of the Opposition has referred to the adverse balance of trade and I am going to place on Hansard the degree to which that adverse balance has mounted in recent years. The figures are as follows:
Adverse commodity trade balance with United States
Year	Million
1950		$	80
1951	 479
1952		 627.9
1953		 758.2
1954		 593.9
1955		 840
1956		 1,282.7
1957	(First 11 months)	 1,036.9


We are not suggesting any diminution of trade but a condition such as that cannot continue in the interests of the maintenance of the economic freedom of a country. My hon. friend the Leader of the Opposition said that we should try to anticipate these difficulties with the United States and avoid them. We should not, he suggested, give excuses to those in Washington for taking economic measures that hurt us. Let us see what the hon. gentleman said on this question before he thought he would occupy the position that he now holds. Let us go back to July 13, 1957, when he used a most peculiar comparison with regard to Canada. I do not know the meaning of it but perhaps he would care to offer an explanation. He made the remarks I am about to read in San Francisco:
The possibility of American domination-
We never heard anything like that from the hon. member in the House of Commons. The election was over and I suppose he was one of the few who thought it possibly would not do any harm to say a few things at that time.


Lester Bowles Pearson: Read Hansard.


John George Diefenbaker: I continue:
The possibility of American domination expresses itself also in other ways. Our natural resources are becoming more and more important to a country whose own resources are being fast depleted. In many respects-
This is what I do not quite understand and I hope the hon. member might interpret this for us:
In many respects, Canada is almost virginal in this field of resources and you know what happens to foolish virgins!


Some hon. Members:: Oh, oh.


John George Diefenbaker: I do not know what that means but perhaps my hon. friend might interpret it.


Lester Bowles Pearson: Read the Bible.


John George Diefenbaker: Really on the face of it, it seems to depart somewhat far from dealing with natural resources. I will now continue to read what my hon. friend said B.C.- before convention, that is very important-and A.D., after defeat. I continue:
The United States now has a great stake, in terms of money alone, in its northern neighbour. That is only one reason, but an important one, why it has an interest in Canada's prosperity; so that your investment will be a profitable one. This will depend, however, to a large extent on our ability to export, for we cannot begin to consume what we produce.
I ask my hon. friend the Leader of the Opposition what his party did during that period of 22 years in which they were in power to increase exports to the United States?


Lester Bowles Pearson: Read the figures.


John George Diefenbaker: I continue:
Our prosperity, even our economic stability, depends on the maintenance of a high level of exports. But there are difficulties and dangers ahead and these are largely concerned with our trading relationships with you-
That is with the United States. I continue:
More specifically, they arise out of our growing unfavourable balance of trade across the border and out of your policies in disposing of surplus agricultural products which affect our competitive position in traditional markets.
Mr. Speaker, again I remind hon. members that these remarks were made on July 13, 1957, following the election of June 10. They pour ridicule on us because we endeavour to bring about a situation to expand trade and also to meet that detrimental situation whereby, so far as the United States, is concerned, our exports are but an infinitesimal part of the total amount of the imports from that country. My hon. friend, the Leader of the Opposition went on to say:
As to the first, the figures will explain our anxiety and our grievance.
This was the grievance voiced on July 14. There was no grievance today in this house. I continue:
Last year, our country with less than one-tenth of your population, bought $4,167 million worth of goods from the United States; more than was purchased by the whole of South America. We are by far your largest customer and we pay our bills in cash. In return, you bought $2,819 million worth of Canadian products, leaving us with an adverse trade balance of $1,348 million. Capital imports, I know, have helped to bridge that gap, the extent of which was caused, I admit also by the very speed and character of our growth, which required vast quantities of capital goods.
The following are the important words:
But this present unfavourable trade balance cannot be allowed to continue-
That is exactly what we have been saying but they say, "When you spoke up, they knocked you down," because the attitude apparently is that it is something to gloat over when Canadians stand up for what is proper and right. I can only repeat what I said before, that almost every United States newspaper with only two or three exceptions editorially approved of the need of something being done in order to bring about the reestablishment of a reasonable equity as between our exports and imports.
It has been the same ever since 1921. I am not going into those figures now. It was the same in 1922 and again in the month of June, 1930, when the United States placed a tariff against the imports of Canadian agriculture. In the past when they have had a surplus they have disregarded our situation. I am not blaming them for what happened
Suggested Resignation of Government then, but I am saying today, and as a Canadian I believe it must be said over and over again, that Canadians have the right to say, joined in defence, joined in the preservation of freedom, each in a position where its own survival depends on the other. The United States must in the future to a degree which has not been practised in the past remove those barriers which have placed Canadians in the last 20 years in the position of being the most wide-open and available market in the world while the United States market has been closed to us.
I continue. Mr. Hellyer said:
Let's get tough.
What did the Leader of the Opposition say?
Unless our exports to the United States can be increased, Canada will obviously have to take some kind of remedial action.
I ask my hon. friend to tell us what is that remedial action? He has something in mind. It was kept under cover for the 22 years they were in power. Let us hear about it now. What is the remedial action? They criticize us for any step that we endeavour to take. The commonwealth received little attention during the days that they were in power. Indeed, in all the speeches of my hon. friend as secretary of state for external affairs there was seldom even an oblique reference to the commonwealth.


Lester Bowles Pearson: Childish.


Some hon. Members:: Shame.


Mr. Speaker:: Order.


Some hon. Members:: Wave the flag.


Mr. Schneider:: You are not in the police court now.


Pierre Gauthier: That's a lie.


Lester Bowles Pearson: Mr. Speaker, on a point of order; the Prime Minister has seen fit to mention me by name in respect of the commonwealth. May I say that the statement he has made is contemptibly inaccurate.


John George Diefenbaker: I will not reply to that in kind.


Lionel Chevrier: What have you been doing all evening?


John George Diefenbaker: I will simply say to the hon. gentleman: Do you remember the United Nations in 1956?


Lester Bowles Pearson: Indeed, I do.


John George Diefenbaker: I ask my hon. friend over and over again to read his speeches in the house on external affairs and he may himself find out that the facts are exactly as I stated.

Suggested Resignation of Government


Mr. Gauthier (Porlneuf):: That's a lie.


John George Diefenbaker: I continue:
Canada will obviously have to take some kind of remedial action.


An hon. Member:: What a phony.


John George Diefenbaker: These are the people who are interrupting.


Donald Ferguson Brown: Don't point over here.


John George Diefenbaker: These are the people who have drawn an amendment to be absolutely sure that they will not be found out. I ask my hon. friend what kind of remedial action he would take? He says it is wrong to stand up. He ridiculed us because we stood up, and actually got a certain amount of pleasure out of saying that we were slapped down when we only talked. What is the remedial action that we did not have between 1935 and 1957?


An hon. Member:: Progress.


Jean Lesage: Prosperity.


Mr. Speaker:: Order.


John George Diefenbaker: Mr. Speaker, I know it is all in good spirit but these unintelligible interruptions represent a better contribution on the part of backbenchers over there than they ever made when they were on this side. I continue:
You will understand, therefore, our irritation and worry when our efforts to bring about such an increase meet demands here for further tariff protection against Canadian imports, already so much less than your own exports to Canada.
Is that not what we say? The hon. gentleman said this on July 13. We believe we can take these words and repeat them:
You will understand, therefore, our irritation and worry when our efforts to bring about such an increase meet demands here for further tariff protection against Canadian imports, already so much less than your own exports to Canada.
The resentment caused in Canada by this process is increased when attempts are made to justify these demands for more protection on the ground that the requirements of defence make national self-sufficiency in certain commodities essential. This argument may well be valid in respect of certain vulnerable areas which might be closed to you as a source of supply in time of crisis or war. Surely it does not apply to Canada. We are the less impressed by the argument because on many other occasions we are told by other American authorities that defence can only be considered as a continental problem and dealt with on a continental basis. It is, I think, a simple, though significant, fact that any further restrictions on Canadian imports into the United States would make further defence co-operation more difficult.
Did anybody ever speak as strongly as that after he was out of power? I ask you this, Mr. Speaker-


Lester Bowles Pearson: I said it in the house the other day.


John George Diefenbaker: Then, finally, my hon. friend said this:
At least that is how I feel about it,-
Well, Mr. Speaker, that is how we feel about it, too. But, the other night, as again today, he ridiculed us for having spoken up. I direct to his attention the next words:
-and I am sure you would wish me to express my feeling in plain language as is customary when Americans and Canadians speak to each other.
This, Mr. Speaker, certainly is an exceptional statement. All we are asking is that today, because of the changes that have taken place recently, the views expressed then be the views of this parliament. Can you conceive of anything that would do greater harm to Canada at a time when congress is meeting, when these protectionist groups in all parts of the United States are waiting for an opportunity to introduce legislation which will further reduce exports from Canada, that the leader of a great party, the Leader of the Opposition, receives such unmitigated joy from the fact our protests have resulted in us as Canadians being slapped down? That is something I cannot understand.


Lester Bowles Pearson: May I ask the right hon. gentleman a question? Has he considered that one possible way of protecting ourselves against that American threat would be to take the British offer of freer trade seriously?


John George Diefenbaker: I notice that my hon. friends did not do that in their resolution.


Lester Bowles Pearson: We did.


John George Diefenbaker: I wish I had that resolution here. It is simply rounded with verbiage, circumscribed all types of words. I should like to read it to you because it certainly does not represent anything like my hon. friend said a moment ago. I am sorry I have not got it here because it indeed represents the greatest example of an endeavor to effect a pretense of words to signify one thing while so surrounded by qualifications as to mean nothing whatsoever.


An hon. Member:: You are an expert at it.


John George Diefenbaker: I continue:
The second disturbing matter which I mentioned was the United States agricultural surplus disposal policy and its effect on our exports abroad. At the moment, this may be, from the Canadian point of view, the greatest single irritant in our relations.
I ask my hon. friend, what did they do? It existed on July 13. It was not removed during the years they adopted this attitude of going to Washington, not doing it openly, you understand, but going in by the back door and whispering so that it could not be heard

in Canada that we did not like this agricultural disposal program. Not a word of it! Not a word of it effectively when in power and then a few days after going out of power pointing out that this is very serious at the moment and that this may well be, from the Canadian point of view, the greatest single irritant in our relations.
Your post-war agricultural policy has resulted, in spite of efforts to avoid such a result, in large surpluses.
The effort to liquidate these by other than normal marketing methods has affected directly our own exports in a commodity such as wheat, from whose sale abroad we derive a far higher proportion of our national income than you do or ever will. Nor can we, with our more limited financial resources-
I emphasize those last words.
-afford to match your new sales methods, giveaways, easy or tied credits, or acceptance of local currencies-
That is what was said on July 13. How different from what was said at the convention a few days ago!
As a result, our own traditional markets for wheat are in danger. If we lose them, or a large part of them, I can assure you that there will be a howl across the border and that our relations generally will suffer.
Today he does not object to a howl. He just objects to us speaking up. What a change in a few months!
I know that those in Washington who are directing agricultural policies are doing their best, within the legislation under which they must operate to avoid these undesirable results, as we in Canada must do also.
I am not going to read any more, Mr. Speaker, but I do suggest that my hon. friends should develop a degree of consistency certainly not apparent in the quotations I have just placed before you. There are many other phases of this amendment that could be discussed but I do not propose to do so. I am not going to add to anything that I said at the beginning, but I must say that when the C.C.F. come along, as I would not be surprised that they might, and remove the last two paragraphs-


Some hon. Members:: Oh, oh.


John George Diefenbaker: Mr. Speaker, we lawyers often engage, as the right hon. member for Quebec East (Mr. St. Laurent) will say, in anticipation. If they do this, if they strike out the last two paragraphs, "and in view of the desirability, at this time, of having a government pledged to implement Liberal policies, His Excellency's advisors should, in the opinion of this house, submit their resignation forthwith", we shall wait and see what we shall see.
3539
Suggested Resignation of Government


Major James William Coldwell: Mr. Speaker, the house has listened to some long speeches today, in fact two of them, and I do not propose to speak at any great length tonight and to take up the various points made either by the Prime Minister (Mr. Diefenbaker) or by the Leader of the Opposition (Mr. Pearson). But I am going to say to the Prime Minister that I want to congratulate him first of all on his restoration to health, which I forgot to do this afternoon, and second, on the good guess he made. Of course, it was so obvious that no one could really miss it.
I must say that I was surprised at the Leader of the Opposition moving an amendment of this description containing the words which the Prime Minister pointed out a few minutes ago. I wonder whether the Leader of the Opposition and the Liberal party have forgotten last June.


Mr. Fraser:: They would like to forget it.


Major James William Coldwell: As a matter of fact, on the night of June 10 the Liberal party was utterly defeated. It was obvious to me at the time, and I said so, that there was only one honourable way for the leader of that party, the then prime minister, to act, and that was to submit his resignation to the governor general and call upon the leader of the opposition, not because I had confidence in a Conservative administration but because that was the proper constitutional thing to do.	.
May I say that since they surrendered the reins of office in June and told His Excellency that the Liberal government could not carry on, no party in this house could support an amendment of this description calling for the resignation of the government in order to put back in power a party which said it could not carry on. May I add that there has been a little change in the membership of the house since then because there are two more members in the government side today than there were on the night of June 10. Therefore I want to dispose of that immediately. We could no more vote for this amendment as it stands with this proposal in it than we could do anything else that appeared as unintelligent as that would be.
Having disposed of that, let me say that throughout this parliament we have tried to place our views before the house at every opportunity. We have done that by way of various amendments which under our parliamentary rules, of course, are regarded, I think sometimes unfortunately, as want of confidence motions. I know that we have been twitted and told that we knew that
3540	HOUSE OF
Suggested Resignation of Government our Liberal friends would not support us, and that therefore we were quite safe in moving these various amendments.
May I say to you, Mr. Speaker, and to the house that we did not know what the attitude of the Liberal party would be shortly after it resigned last June, when our members met in the city of Winnipeg and decided upon the course that we have followed consistently ever since. We have no apologies to offer. We have functioned as we think an opposition party should function. We have, as we said we would, supported legislation that we thought would be in the interests of the people of Canada. We have done that consistently. When we thought that legislation should be amended to make it better, we have moved amendments. When the government has failed to bring down legislation which we thought should be brought down in view of the statements made by the Prime Minister and others during the election campaign we have moved amendments along the lines of those promises that were made in April, May and June of last year. That has been our consistent policy; and come what may, we shall have no apologies to make either to this house or to the people of Canada when an election comes around as to what our role has been.


Mr. Fulton:: You will regret your stand on the farm bill.
Mr._ Coldwell: My hon. friend said we would regret our stand on the farm bill. It may be his opinion that the farm bill is not what we say it is. But we shall not regret our stand, whatever the result may be, because we believe that the stand we have taken is the right one. One never regrets something one does when one does the thing that one considers to be right. Hence there are no regrets. As far as the farm bill is concerned, I am convinced that we are expressing the views of the vast majority of the farmers across Canada. I have talked to officers of the Canadian Federation of Agriculture, to officers of other farm organizations across Canada and to farmers; and I have been told without any hesitation that this legislation is a disappointment and that into this legislation has not been written the kind of price formula that they expected to find in that legislation. Hence there are no regrets as far as these matters are concerned.
This afternoon the Leader of the Opposition (Mr. Pearson) pointed out quite correctly that we are living in critical times. This evening the Prime Minister placed on the record the manner in which the financial market has been acting in the past year or


more. I want to say to my hon. friends that we hold the view, that until we substitute for this speculative system planned trade, planned investment and a planned financial system we shall have these ups and downs in our economy from time to time. As a matter of fact the conditions that gave rise to the great depression of the 1930's are still underneath the present system, obscured as they have been by war, by postwar expenditures for the relief of those who needed relief, and then by war and rearmament again. Those are the factors which have kept our economy running as it has been running over the past several years.
We have now come to the point where the economy is showing signs of a recession. Not so long ago some of us in this house were talking about the rise in unemployment. In spite of all that has been said this evening, the rise in unemployment in this country over the past few months has been phenomenal and it has been alarming. There were 186,000 people unemployed and seeking work in December, 1956 and 386,000 unemployed and seeking work in December, 1957. That is what has happened in the course of one year.


Paul Joseph James Martin: And 50,000 more since then.


Major James William Coldwell: As my hon. friend interjects, the figures are still rising according to the more recent figures that have been given to us. I therefore say that we have the right to say to this government, "What are you doing about the situation, and what did you do about it in the autumn of last year?"


Paul Joseph James Martin: And "What did you promise?"


Major James William Coldwell: What did you do about that matter? You told some of us that we should not be discussing unemployment, that to talk about unemployment and the possibility of some recession was to bring on recession and to bring on unemployment. In other words, you told us that, like ostriches, we should put our heads in the sand and try to hide from ourselves the conditions that are prevailing all around us. We do not propose to do that, Mr. Speaker.
The same thing applies with respect to farm prices. I am not going into farm prices tonight because the farm problem has been so well debated in this house on the bill which is now before the house and which the government has changed. However, what I am saying is this. What has happened was obvious earlier last autumn; and it was then that steps should have been taken to set up public works programs. I am thinking of

this northern project, mining roads, development roads and so on. When was it announced? It was announced on January 2. When has that project to be completed by the provinces? It must be completed by June. Obviously there is not sufficient time for the provinces to make the necessary preparations and do the kind of job that is required to be done if it is going to alleviate to any great extent unemployment in our country.
I look around and see the numerous things that need to be done in this country. I am not going to put the figures on the record. We have heard a good deal about housing and about new units that have been started and completed over the past year. That is fine. I am glad to know that. But when I see the figures showing the numerous houses already existing with no running water, no bathroom facilities, no inside toilets, I realize that the sanitary organizations of the municipalities and so on could do with some financial assistance in order that they might improve the sanitary conditions from one end of this country to the other.
Two weeks ago tomorrow I introduced in this house a resolution calling upon the government to do something for our educational system. At that time I gave a good many reasons why we should be doing that. I am not going to recapitulate them tonight. However, in the gallery that afternoon there happened to be a gentleman with very high qualifications whom I had never met before but who sought me out and said this to me, "Have you ever thought of this; have you ever thought that Canada did a magnificent job in the air training defence plan, one that proved to be of great benefit to Canada in the years after the war; that defence training plan gave you airfields and facilities of every description". He said to me "You said this afternoon that by 1980 both high school and university facilities would be entirely inadequate and would be overburdened long before then".
He asked me "Why not, as part of Canada's contribution to the world, decide that we are going to set up a commonwealth or wider educational plan so that we can bring in young students from overseas and train them educationally, scientifically and technically; build the facilities and when we are through with that plan we shall have provided ourselves with the facilities which would enable us to take care of our young people in the future?" I thought that was a very excellent idea. There are so many things that might be done in order to relieve unemployment and in order to distribute purchasing power.
Bear this in mind; when people are unemployed they cannot purchase eggs, they 96698-2244
Suggested Resignation of Government cannot purchase butter and they cannot purchase meat, with the result that the farmers who produce those things feel the effects of unemployment, not as acutely as the people in the cities but nonetheless fairly acutely.
Some of us who were here in the 1930's recall that in 1936 and 1937 our people were in the depths of the greatest depression this North American continent has ever seen but, in 1938, 1939 and 1940, when as governments we began to make great expenditures in the field of rearmament because of the threat overhanging the world at that time, we found farm prices rising; the price of eggs rose as did the price of butter, meat and other farm commodities. The two things are inter-related and I say that our government has neglected these aspects of the economic situation.
I said a few moments ago that among other things we should use financial methods to meet this unemployment problem. What did I mean by that? I meant that under the leadership of our governmental institutions -our Bank of Canada, if you like, or a new organization of that description-we should establish a national investment organization.
Such organization would not order but would direct the savings of our people into socially desirable channels, into housing, into improved sanitary conditions, into the elimination of level crossings. What a blot are the deaths at level crossings at the present time. I say that we have many things which we should do other than those which are being done. I say to the Minister of Labour (Mr. Starr) that it is all very well to appeal to our private citizens to do the little things within and around their homes to give some employment in the winter period, but that is a relatively small contribution to the elimination of unemployment.
I think I had now better put on the record this amendment which I now move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That the amendment be amended by striking out all the words after the words "steady administration" and by substituting therefor the following words:
"this house is of the opinion that the economic conditions now facing this country, including the uncertainty of our export markets and the alarming unemployment situation revealed by figures released during the past week, call for consideration by the government of the United Kingdom trade proposals as well as other means to secure increasing markets for our farm and industrial production, and also for consideration of immediate action to relieve unemployment and distress by adopting a fiscal policy which will enable the government to re-direct investment and embark on a comprehensive program of public development."

Suggested Resignation of Government
I say to all hon. members in every part of this house that I believe this is an amendment which should be supported in all quarters.
We have heard a great deal about the Thorneycroft proposal back in September last for a freer trade agreement between Canada and the United Kingdom. I do not know where my hon. friends of the Conservative party stand on this proposal and I certainly do not know where my hon. friends of the Liberal party stand on it either, because I noticed that when the trade delegation was in the United Kingdom day after day hon. gentlemen rose in this house who appeared to be very perturbed lest members of that delegation should visit certain industrial plants that might be competitive with plants in the areas they represented in this house. I wonder just how genuinely interested some, not all, members of the Liberal party were in the freer trade proposals. Freer trade is the word that should be used because, as Mr. Thorneycroft said at the time, this would have to be worked out over a period of years and we believe one of the essential things which Canada should be doing is giving leadership in the direction of freer trade across the world. We have suggested the establishment of an export and import board to assist in the sale of our products and the exchange of items for the things we need.
I was very interested the other day to hear one of the hon. gentlemen in the Liberal party rise and ask about the acceptance of sterling. We suggested that in 1947 and my hon. friends in the Social Credit group also suggested it. Always the suggestion was met by the government then in power with the statement that it could not be done and it would not be economic to take any local currency, sterling or any other overseas currencies. Yet we have seen the United States since that time promoting its trade with Japan and some other countries by taking quite large quantities of local currency and by re-investing it to develop those countries which supplied it.
I would even suggest that we make arrangements through a proper import-export organization to exchange goods on a basis of value for value, if you like, and I would certainly like to see trade channels opened up in some directions where I am sure we could dispose of some of our commodities-for instance some of our vast accumulations of wheat-in the years to come. I have in mind particularly the 600 million people on the mainland of China.
As hon. members know, we have long urged the government to recognize the fact that 
there is a government in control of the mainland of China and resume diplomatic relations without approving of their form of government or what they are doing, so that our traders may go into that country, if for no other reason, under the auspices of Canadian officials who can introduce them and assist them in the sale of Canadian goods. I want to say that this suggestion is becoming more and more acceptable not only in Canada but in the country whose lead we have followed, namely the United States. One reads the statements which have been made in that country from time to time. The time has come when the facts should be faced and when recognition should be granted. There we have the possibility of trade with some 600 million people, a potential market which is important not only for our farm production but also for our industrial production. I am quite certain that some of our Canadian industries -the electrical industry or the automotive industry with its large output in Canada- could find markets overseas provided we accepted either the goods or the currencies of those countries with whom we traded these things. These are all ways in which we could relieve unemployment.
We have listened today to long speeches which, I have no doubt, are election speeches. I thought as I listened to the Prime Minister tonight that this was the handbook for the Conservative party for the next election which was probably being put on the record this afternoon; and, of course, the Prime Minister and his colleagues have now the facilities which they did not have before to get these things together, facilities which I am afraid my hon. friends in the Liberal opposition will greatly miss, and facilities to which we have never had access. Perhaps we are just as well off doing our own digging, because after all when we do our own digging it sticks in our memories and we do not need to get up and read a long manuscript; we know what we are talking about without having to read from a manuscript.


James Sinclair: Or read from other people's speeches.


Major James William Coldwell: I did not say that.


James Sinclair: He read the speech of the Leader of the Opposition (Mr. Pearson) which was longer than his own speech.


Major James William Coldwell: I did not say that, because I do not know. My hon. friend does.


James Sinclair: You misunderstood me. I was talking about his reading of the speech made by the Leader of the Opposition.


Major James William Coldwell: Oh yes. I think that might to some extent be regarded as a compliment although, of course, it was done in a very critical manner. I might find some data in that which might come in handy to me on some future occasion.
I do not propose to speak any longer. We have had a long day. I have moved an amendment. The amendment wipes out a part which I think should never have been included in the motion. I am quite sure the Leader of the Opposition and those with whom he conferred must have had their tongues in their cheeks, because they knew perfectly well that we could not support an amendment of that sort calling for the restoration of a Liberal government in the circumstances under which they resigned last June and the situation which resulted in a general election.
I want to say this to my friends opposite: do not imagine for one moment that I am expressing any confidence in the Conservative party. I am going to say this very seriously: never in my experience have I seen a group of men assume office with a very clear promise and responsibility in at least one important particular and then go back so completely on that promise. I refer to the trans-Canada pipe line debate.
They were going to get rid of these buccaneers; they were going to end this nefarious deal. The Prime Minister went round the country talking about black Friday. Some of us who participated in that scene will never forget it. But they seem to have forgotten about it, and tried to shelve the whole thing by referring it to a royal commission. I am not going to talk about the personnel of that royal commission. I have never tried to attack the personal character of any man on that commission, and I would not do so because I think they are all estimable citizens, but I cannot yet see how a gentleman who controls and operates one of the greatest privately owned public utilities in the world can give an entirely unbiased view on whether or not the trans-Canada pipe line should be publicly or privately owned. Nor can I see how a gentleman with great private interests in a foreign country-foreign-con-trolled organizations in that country-can give an unqualified verdict in support of the elimination of foreign control over some utilities in our country. As I said over the radio, and I say it again in this house, I regard this as a betrayal of trust.


Mr. Speaker:: I hope the hon. member does not intend to pursue this subject because as he will recall it was the subject matter of an amendment moved in supply some time ago and was dealt with then. It is not in the amendment tonight.
Suggested Resignation of Government


Major James William Coldwell: I have finished what I intend to say in that regard and I will not refer to it again. But I do wish to say that soon or later I suppose the government will go to the country. I said something about the constitutional position regarding the Liberal party. I have a vivid recollection of 1926. I have a vivid recollection of the position taken by a great leader of the Conservative party, the Right Hon. Arthur Meighen, a gentleman with whose views I sharply disagreed in the main, but nonetheless a great Canadian and a great lawyer who was a distinguished leader of the opposition and for a short time prime minister of Canada. He held the view, which I think is consonant with the constitutional practice throughout the British commonwealth, that a government which can command a majority in the house has no right to ask for a dissolution, and this government has had the largest majority of any government in my experience in the 22 years I have been here. What the Leader of the Opposition should be proposing is not that we should vote with them but that there should be a coalition between the Liberal and Conservative parties because in the final analysis there is not one atom of difference between them. The only difference lies in their administrative approaches. Fundamentally they believe in the same things. They are the same people, and there is a possibility of a coalition. What a coalition it would be. What an overwhelming majority the Prime Minister would have.


Mr. Balcer:: We keep our promises and they don't.


Major James William Coldwell: I said I would not mention the pipe line question again. Don't provoke me.
Mr. Speaker, I think we have had a very interesting day. We have had a very tiring day. I always find it a little tiring and trying to listen to very long speeches and we have had them today. However, I suppose that the speakers are justified in putting on the record all that they can find to put on, and I should not think that much more could be found to put on the record on some future occasion. The amendment is before the house. I suggest it is a good amendment and that everyone in this house should vote for it.


Mr. Speaker:: I am not sure that the amendment proposed by the hon. member for Rose-town-Biggar (Mr. Coldwell) does not overlap a previous amendment relating to unemployment but I shall let it stand for the time being and consider it later on.


Solon Earl Low: Mr. Speaker, this has been an extremely interesting day. It is unfortunate after the excellent speeches
3544	HOUSE OF
Suggested Resignation of Government we have heard thus far that we have to continue until ten o'clock but we have to do so and much as I dislike the thought of burdening you with any further verbiage I have to do my duty and so I must continue until ten o'clock.
It was refreshing indeed to see the life that had sprung into the Liberal party somehow during this past week. For the first hour today the members of that party showed signs of being right up in the clouds. I was somewhat disappointed in the way they became deflated, however, a little later on and grew exceedingly quiet. I want to pass on a word to my hon. friend the Leader of the Opposition (Mr. Pearson). In the next few years you are going to hear a lot of things that will be hard to take and which you will find disconcerting. What you have to do is just sort of roll with the punches and not let it bother you too much because, after all is said and done people are doing what they think is their duty in this house. I am sure they do not mean anything really personal just as I am not going to mean anything personal as I present what I have to say tonight.
The new Liberal leader made an excellent speech this afternoon and I congratulate him on it. I am not going to say, as the Prime Minister (Mr. Diefenbaker) said, that I congratulate him on everything but his courage. I do not intend to talk about the question of courage at all. As a matter of fact, I am not at all sure that the Prime Minister was correct in diagnosing the attitude of the Leader of the Opposition as a lack of courage. I think what the Prime Minister really should have done was to have described it as discretion.
After all the build-up since the beginning of the real advertising for the Liberal convention, a great many people, of course, have expected fireworks here in parliament this afternoon and this evening and that is the reason they gathered in such large numbers today and filled all the galleries and even the standing room because they expected to witness a dramatic moment. They fully expected to see the Liberal party come back to life and move an amendment that everybody on the opposition side of the house would have to support and therefore the government would have to resign and there would be a new election.
Instead what did they witness in parliament today. During the supper hour I heard a good description of it. The description ran that the people of Canada today witnessed a good argument between the Prime Minister and the Leader of the Opposition. It was rather like two men seen drifting in a canoe


down a swiftly flowing river and when they were about to go over the falls they were still heard engaging in loud argument about who had broken the paddle. That is about the extent of the argument we heard today.
For weeks the Liberal press has been saying, "Just wait until we get our new leader, and we'll show ya'." On the other hand, the Conservative press and the Conservative party have also suggested they were itching for a fight and the press has been saying, "Bring on your new leader, his father and all his brothers and relations, and we'll lick the bunch of ya'." The fact is that when the showdown came the one was afraid and the other "dassn't". That is how it looked to the public today. However, I am not going to say that the Liberal leader lacked courage. Sometimes it takes more courage not to fight than to be quick to get into one. Let us say, then, that the new Liberal leader used discretion thinly coated with daring, the kind of daring that says, "I'll betcha can't lean six feet out of the barn loft window without falling and breaking your neck". Perhaps the Leader of the Opposition thought the Conservatives would be unwise enough to try it. I am not so sure but that they will; nobody knows yet.
The Liberal leader used discretion in the amendment he moved because no doubt he believes that he who strikes and runs away will live to fight another day. I am not quite sure after all the emphasis he placed on the term "Liberal policies", both as he spoke and when he read his amendment, that he really expected us or anybody else in the opposition to take it seriously or be prepared to vote for it.
In spite of all this, the amendment contained some interesting sections and spoke, among other things, of growing unemployment. I think everybody knows that unemployment is indeed serious today and I believe that the situation at the present time gives every indication of growing more serious. Because of this we believe that every effort ought to be made to relieve that situation. The question that arises is this: Is the Conservative government to blame for the present stagnation and unemployment?
One does not have to go back very far and one does not have to quote too many statistics to find the answer and I certainly will not indulge in the extensive quotation of statistics the Prime Minister engaged in this afternoon. But if one were to simply go to page 42 of the Bank of Canada report for 1956 one would read these amazing sentences in Mr. Coyne's report. I wish to point out with emphasis that I am speaking of the report

Suggested Resignation of Government
for 1956 and not for 1957 or recent months. At page 42 of that report Mr. Coyne wrote:
It is not an accident that periods of inflationary prosperity are usually followed by periods of dislocation in production and employment. One of the main purposes of efforts to contain inflation is to avoid this aftermath.
I have been convinced for a long time that some governments use unemployment as a definite and deliberate policy and I am certain that back in 1956 Mr. Coyne, the governor of the Bank of Canada, saw it coming and also realized that unemployment would be used as a deliberate policy. When I speak of unemployment being used as a deliberate policy I think of a comment I heard made by the Right Hon. Ernest Bevan in a speech right here in the city of Ottawa some few years ago when he visited this city some time before his death. He said, in effect: If we had not been afraid of the communists and communist expansion in 1950 we in our country would have brought on a policy of unemployment as a means of readjusting our economy.
I do not think there is any question about the fact that governments have used it, and that the situation we are now in with respect to unemployment was foreseen by the governor of the Bank of Canada. I am certain that it did not come as any great surprise to some people who were in the driver's seat. Stagnation had set in long before the election of June 10. Everybody knows about the serious dislocation that had occurred in agriculture. Beginning in 1951, when farm cash income reached its peak in this country, there began a very serious decline that continued year after year until in 1957 the farm population numbered approximately 16 per cent of the total population and received less than nine per cent of the national income. That in itself was a very serious thing and foreshadowed unemployment, because every time farm cash income drops there will be dislocation in industry and someone will have to be laid off. That situation was brought before the government of the day and the Liberal government failed to get into serious grips with it.
There was the rising tempo of failure of small businesses, beginning in 1956 and continuing all through 1957. That should have been indication enough to the government of the day that we would be facing serious unemployment before the year was out.
There was the slowdown in housing construction. It came almost to a standstill early in 1957 when, as I recall it, there were only a very few hundred starts during the whole of the month of January and the early part of February.
There were signs of quite serious unemployment showing very early last spring in the
lumber industry. Complaints were made about it right here on the floor of the house and actual figures were quoted showing the number of people out of work in the lumber industry. In British Columbia particularly some cities like New Westminster had to undertake quite a lot of relief work for those out of work and who had been out of work for months in the lumber industry. That was well known.
The automobile industry early in 1957 began to show very serious signs of unemployment and stagnation. Men were being laid off and a call came for the government to try to do something about stimulating automobile sales through a reduction of sales tax and excise tax.
The farm machinery industry was hit hard early in 1956 and it continued all through 1957 to show signs of difficulty. Of course, unemployment increased there. Everybody knows about the textile industry and how unemployment has been developing in that industry for the past two or three years.
I suggest, Mr. Speaker, it was certainly not a matter of surprise to anybody that unemployment began to pile up this last autumn, and that it has reached the alarming figure of 386,000 people out of work today. As a matter of fact, unemployment and growing stagnation were among the real issues in the 1957 election campaign. The interesting thing to me is that try as we did we could not get the Liberal party to get down to a discussion of that real issue in the first six weeks of the campaign. They continued to avoid it and to live in the clouds, to build straw men and set up phony issues. I do not think there is anyone who can doubt that at all. All during the campaign they remained in the clouds. The real root of the trouble was laid as far back as 1955, during the 20th year of continuous Liberal rule.
I want to refer just for one moment, Mr. Speaker, to just a very few figures which will indicate the truth of what I have just said that the real root to the whole situation was laid back in 1955. I refer for my facts to the statistical review of the dominion bureau of statistics, Ottawa, December, 1957. I find on page 66 a table indicating the total loans that were in existence through the chartered banks, as at the end of the various periods, beginning in 1954 and down to October, 1957. Here is what I find. In 1954 the total loans advanced through the chartered banks stood at $4,095 million.


Mr. Speaker:: Order. Will the hon. member allow me to ask the house to moderate its conversation a bit. There is a buzz in the house which makes it very difficult to hear.


Solon Earl Low: Thank you very much. You are a real pal, Mr. Speaker. I repeat the figure
3546	HOUSE OF
Suggested Resignation of Government so that those who are kind enough to listen may catch the trend of what I am trying to say. I am pointing out that in 1954 all the chartered banks in Canada had loans on their books to a total of $4,095 million. A year later, at the end of 1955, those chartered banks had a total of $4,891 million, which was an increase over the year before of $796 million. By the end of 1956 they had $5,363 million in loans, an increase over the year before of only $471 million. By the end of the first 10 months of 1957 the total loans outstanding amounted to $5,439 million, or an increase of only $76 million over the previous year.
That tells the story, Mr. Speaker, of the tight money policy so far as the banks are concerned and it tells it very effectively. The reduction in the rate of increase in money supply was from $796 million in 1954 to 1955, and down to $76 million near the end of 1957, in the face of the fact, Mr. Speaker, that all during that period we had a very steady and spectacular increase in the gross national production.
If you look at the facts from the Bank of Canada statistical summary for 1956 you discover that in 1954 we had a gross national production of $24,336 million; in 1955, $26,916 million; and in 1956, $29,866 million, and we understand that for 1957 it was over $30,000 millions. But in spite of that great increase in the gross national production during those years, far more goods to distribute to our people throughout the country, there was a steady decline in the rate of increase of the money supply. That tells the story, more effectively than I can do it, of the effect of the tight money policy upon this country that was initiated under Liberal rule and with Liberal concurrence back in the fall of 1955, and it has continued more or less unabated until this day. Indeed, Mr. Speaker, there is ground for sincerely believing that the real roots of the unemployment situation were put down during the Liberal regime, and there is no use their trying to squirm out from under their responsibility in that regard at all.
There appears to be no doubt that seeds of stagnation were sown and firmly packed into the Canadian soil during the time of Liberal rule. It was clear as far back as the beginning as 1957 that unemployment was bound to increase unless clearer vision and more courageous action were brought to bear upon Canada's problems and more realistic economic policies were adopted. Seven months after the new government took office we have to ask this very important question. Has the present government done all it could reasonally be expected to do to halt the downward trend and to relieve unemployment and prevent further expansion of it? I have not 

very much time left but I will perhaps have time to begin to answer that question. It is a question we must ask and answer honestly if we are expected to know how to cast our vote on this amendment.
In the first place, the Conservative government appears to have realized the seriousness of the situation and as far as we can tell they did not attempt to minimize it or to hide the facts. That is commendable. I have to give credit where credit is due. They have done some things. They have taken some steps to bolster employment. We must admit that. Whether they have done all they can is another question.
The present situation, Mr. Speaker, indicates very clearly the need for some technique to inject directly and quickly into the hands of the consumers of this country new purchasing power with which those consumers themselves can increase economic activity by their effective demand for the goods and services that are available for sale. That in itself would go a long way toward clearing away unemployment and preventing any further growth of it. But, Mr. Speaker, we have not got it, and that is the thing that we Social Crediters, ever since we came into this house back in 1935, have been pleading with governments to provide themselves with, a technique for injecting new purchasing power quickly and directly into the hands of the consumers of this country so that they themselves can cure unemployment.
But what have you done? Nothing. We preached to the Liberals over here-they were over here by the way and we were over the way-for 22 years. Nothing was done although on several occasions we had people on the front benches of that party agree that we had something and one of them one day went so far as to say, "Oh well, we know you fellows are putting forward an idea that is probably a good idea but we will not let you put it into effect; we will do it ourselves." But they never did. They went out of power and that ought to be a warning to some people.


An hon. Member:: Some people never learn.


Solon Earl Low: We do hope they will, however. As I have said, the government has given evidence that it realizes the seriousness of the unemployment situation and has talked about the methods it is going to use to try to clear it away. But they have been fringe methods. They have been tinkering instead of getting right at the root at things. The Leader of the Opposition said today that what is needed is bold and courageous action. He said that we need a good measure of public investment to hold the line while we are creating a better atmosphere in which

trade and so on can take place. It would be interesting for him to define what he means by that bold action. It would be very interesting for him to tell the house what he means when he says that public investment should be used. I should like to know what he is going to do about it, how he will raise the money and what kind of investments it will be put into. Those are things we ought to know.
But let me say a word about our friends on this side of the house. They have failed without question to bring in a budget. That is serious because let me point' out, Mr. Speaker, that if the government had seen its duty clearly and had faced up to the situation they would have brought in a budget and they would have provided themselves with the right to budget for a deficit so they could do some public investment that would alleviate the unemployment situation. But they have not had the courage. I think the hon. member for Coast-Capilano (Mr. Sinclair) was reported in the press the other day as saying that a deficit budget was something that should be made use of at the present time. Maybe that is what the Leader of the Opposition had in his mind. If it is, perhaps he would suggest it. But I tell you, Mr. Speaker, that the government will not begin to deal effectively with the unemployment situation until it brings in a budget and provides for some deficit budgeting.
I think the government ought to look very seriously at that situation and make some plans. It looks as if they are going to have some time, sort of a lease on life, and perhaps that time could be well used. You know, it is all to the good to go off and do a little bit of meditating. I see the hon. member for Essex East (Mr. Martin) looking at me. I think he realizes that meditation is good for the soul. I suggest that the Conservatives go off into
Business of the House
the quiet of the night, meditate on these things and see if before we reach the end of the present session they will not be able to bring forward some really effective methods by which they can deal with the unemployment situation. I see it is ten o'clock, Mr. Speaker, and as I have not finished yet I would move the adjournment of the debate.


Stanley Howard Knowles: You
would like a chance to meditate before you tell us how you will vote.


Solon Earl Low: I should like to have a chance to meditate so I can inform my hon. friends over there how we are going to vote on their subamendment. I can already say that we could not possibly vote for the amendment, but I shall go into silent meditation. I should like to move the adjournment of the debate.
On motion of Mr. Low the debate was adjourned.



BUSINESS OF THE HOUSE

Lionel Chevrier: May I ask what the business of the house will be?


Howard Charles Green: Mr. Speaker, tomorrow we shall continue with this debate.


Lionel Chevrier: Will the leader of the house tell us what the business will be for Wednesday?


Howard Charles Green: If there is a Wednesday, we expect to begin with the second reading of the bill to provide for the stabilization of the prices of agricultural commodities. Once that has gone through the house, we will take up the estimates of the Department of Citizenship and Immigration and then the Department of National Revenue.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
3549
[Stage Direction]
Tuesday, January 21, 1958