1962-10-30

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, yesterday I informed the house regarding the request from India in connection with certain defence equipment. I can now report that the Canadian government has advised the Indian government that Canada could supply immediately certain equipment including aircraft. However, to establish more specifically what assistance may be given, it has been recommended that a team of Indian officials meet with Canadian officials immediately to examine certain specified Indian needs in relation to Canadian equipment availability. I might add that it is understood that the Indian government is interested in Caribou and Otter aircraft and at the moment is discussing with the manufacturer the possibility of procurement of these types of aircraft.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, as indicated yesterday, we on this side will certainly support any help that the government can give India, which is protecting itself against aggression. Therefore we welcome the Prime Minister's statement. I take it that these supplies which are being made available to India will not be in the form of a gift, because India does not like that kind of transaction, but I hope that the Indian government will be given the most generous terms of payment and credit.


PUBLIC SERVICE
John George Diefenbaker: Mr. Speaker, following the usual course I wish to inform the house of an appointment. Mr. Stanislas J. Chagnon has been appointed associate deputy minister of agriculture. He is a native of Rouville county, Quebec and is a graduate of the University of Ottawa and of the Iowa State college where he received his bachelor's and master's degrees in agricultural science.
He was employed by the federal Department of Agriculture in Ottawa at the central experimental farm from 1921 to 1927. From then until 1946 he served with the Quebec department of agriculture in various capacities, including that of director of the provincial dairy school at St. Hyacinthe. He returned to the federal service in 1950 as vice chairman of the agricultural stabilization board and in February, 1955, was appointed assistant deputy minister of agriculture.
Mr. Chagnon has a broad knowledge of Canadian agriculture and in particular of Quebec agriculture, and has represented the Canadian government on various agricultural missions abroad.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, may I direct a question to the Minister of Defence Production. Is the minister aware of the serious crisis facing Canadair Limited in Montreal at the moment because of the number of unsold planes, and is there anything his department can do to keep the firm in production?


Hon. Raymond O'Hurley (Minister of Defence Production):: Mr. Speaker, the unsold planes to which the hon. member for Laurier has referred were built under an agreement with the Canadian government. We are cooperating according to the agreement that was undertaken, and I am in daily communication with Canadair to see what can be done for the company.


Lionel Chevrier: A supplementary question. In the light of the request made by the government of India to the government of Canada, and having regard particularly to the statement made a moment ago by the Prime Minister to the effect that certain aircraft are required by the government of India, will the government give consideration to Canadair providing some of this equipment?


Mr. O'Hurley:: The aircraft specified by the Prime Minister are manufactured by de Havil-land Aircraft Company, Toronto, not by Canadair.

Inquiries of the Ministry


Lionel Chevrier: I listened to that statement very carefully, but my question was, will the government or the minister's department give consideration to the kind of planes that are being manufactured by Canadair for the purpose of meeting India's requirements?


Raymond Joseph Michael O'Hurley: As the hon. member will realize, Mr. Speaker, India specifies the type of plane she requires. We cannot sell the CL-44 to India if they do not wish to have this type of plane.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. Is the government planning to take any action in respect of the advertising of drugs said to be effective in the treatment of cholesterol in the light of Dr. Morrell's statement of yesterday?


Hon. J. W. Monteith (Minister of National Health and Welfare):: The department is scrutinizing the advertising of all drugs at all times, and is certainly on top of the situation.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Mr. Hubert Badanai (Fort William):: Mr. Speaker, I wish to direct a question to the Minister of Citizenship and Immigration. Is the government giving consideration to the introduction of an amendment to the Canadian Citizenship Act during the present session of parliament?


Mr. Speaker:: Order. The hon. member is asking for a declaration of policy, which I think is not in order on orders of the day.
(Translation):



SIMULTANEOUS TRANSLATION IN COMMITTEES

[Stage Direction]
On the orders of the day:
Mr. Bernard Dumont (Bellechasse):: Mr. Speaker, I should like to direct a question to the Minister of National Defence. Is the Department of National Defence still in possession of the equipment used to provide simultaneous interpretation when the Universal Postal Congress was held in this house?


Mr. Speaker:: Order. This question should be put on the order paper.


Bernard Dumont: Mr. Speaker, I rise on a point of order. If I am asking this question at this time, it is because we attend committee sittings where no simultaneous translation is available. On the other hand, we are informed that the Department of National Defence once had the required equipment in its possession. As reported on page 135-


Mr. Speaker:: Order. I am still of the opinion that this question should be put on the order paper instead of being directed to the minister on the orders of the day.


Bernard Dumont: Mr. Speaker, with all due respect-


Mr. Speaker:: Order. The hon. member is not allowed to question the Speaker's ruling.
(Text):



MANUFACTURE OF AUTOMOBILE PARTS BY CROWN COMPANY

[Stage Direction]
On the orders of the day:
Mr. Robert W. Prittie (Burnaby-Richmond):: I should like to direct a question to the Minister of Finance, of which I have not given him notice. It relates to his announcement yesterday concerning the importation of automatic transmissions and the suggestion put to the minister by the hon. member for Essex East that a crown corporation be formed to engage in the automobile business. Is the minister giving serious consideration to this proposal of unreconstructed socialism?



RUSSIA-CANADIAN DELEGATION TO DISCUSS AGREEMENT

[Stage Direction]
On the orders of the day:
Mr. John H. Addison (York North):: I should like to direct a question to the Minister of Trade and Commerce. In view of imminent negotiations, will the minister inform the house of the names of the Canadian delegation which will negotiate the Canadian-Soviet union trade agreement in November?


Hon. George H. Hees (Minister of Trade and Commerce):: Yes, Mr. Speaker, and I thank the hon. member for giving me notice of his intention to ask this question. The delegation to this meeting to review the operations of the present agreement will be headed by Mr. Vincent Chapin, assistant director of the international trade relations branch of the Department of Trade and Commerce. He will be accompanied by representatives of the Departments of National Revenue and External Affairs.



INQUIRY AS TO PAYMENT BY CHINA

[Stage Direction]
On the orders of the day:
Mr. R. B. Cowan (York-Humber):: I wish to direct a question to the Minister of Agriculture. In view of the Prime Minister's statements regarding the types of military equipment we are to sell to India I wish to ask the Minister of Agriculture if the Chinese communists have paid for our wheat. Should we shoot our debtors?


Mr. Speaker:: Order.


Mr. Jones:: Why don't you say that out west?


Mr. Speaker:: Order. I think the hon. member will recognize that his question was quite improper. He was offering an opinion.



PIPE LINES


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Pori Arthur):: I should like to direct a question to the Minister of Trade and Commerce. Has he sought the resignation of the head of the Northern Ontario Pipe Line Crown Corporation, and if so what is his explanation for doing so?


George Harris Hees: Mr. Speaker, the head of that corporation is the former deputy minister of the Department of Defence Production. He is now in private business. Two days ago he tendered his resignation to me, and the government is in the process of appointing a new president of the corporation.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. Charles M. Drury (St. Anloine-Wesi-mount):: I wish to direct a question to the Minister of National Defence. Would he explain to the house the reason for the proposed embargo on civil flying in eastern Canada as announced recently in the official Gazette?


Hon. D. S. Harkness (Minister of National Defence):: Mr. Speaker, there is no proposed embargo, but I think some misconceptions have arisen as a result of certain newspaper articles. The actual situation is that one of the ordinary regional exercises, which have been going on for a number of years, is planned to take place on December 11. It will be confined to the eastern portion of Canada and will involve aircraft of NORAD and the 27507-3-69J
Inquiries of the Ministry strategic air command. Civilian air lines will not be affected, other than by slight adjustments to altitudes and flight plans.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Mr. E. T. Asselin (Noire Dame de Grace):: I wish to direct a question to the Minister of Justice. Has the Department of Justice, through the Royal Canadian Mounted Police, conducted an investigation into an alleged swindle involving the Home Improvement Loan Act in the Montreal area? If so, has any action been recommended?


Mr. Speaker:: Order. I think this is a matter of detail and should be put on the order paper.


Lionel Chevrier: Mr. Speaker, I rise on a point of order. This question is of extreme importance to certain people in the district of Montreal. Not only is it of importance but I think it has to do with a matter which might be of a criminal nature, and it has been the practice in the past to ask this type of question. Surely it is one which falls within the rules.


Mr. Speaker:: Order. It may be important to certain people, particularly those who may be involved, but on the other hand I think it would be quite improper to ask the Minister of Justice every day whether the Royal Canadian Mounted Police were conducting an investigation into this or that activity in every part of the country. The question involves a matter of detail and I think it should be put on the order paper.


Mr. G. J. Mcllrailh (Oltawa West):: Mr. Speaker, may I be heard on the point of order. It seems to me that the question at issue here is whether or not public funds have been in some way improperly dealt with, and that is directly the responsibility of the administration. It has been the practice that if there is some occurrence that may possibly directly involve the administration of public funds, by their misuse or misdirection, this is something the government should be asked about and would want to answer. Therefore there is the kind of urgency required in a question on orders of the day. There is also the matter of national importance because it is public funds that are involved. Those two ingredients are directly involved in the question.


Mr. Speaker:: I think the same might be said if the R.C.M.P. were perhaps conducting an investigation into shortages in a small post

Ways and Means
office or in some other government office. I do not think the matter is of sufficient importance that it should be discussed here on orders of the day. The question could be much better put on the order paper, where it would be better framed and would perhaps elicit more information.


George James McIlraith: But, Mr. Speaker-


Mr. Speaker:: The hon. member for
Kootenay West.
POV/ER



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kooienay West):: I wish to direct a question of urgent national importance to the Minister of Justice. In view of Premier Bennett's statement to the effect that "the Peace river is for sure, and the contract is going ahead. But unless arrangements can be made to sell our share of the Columbia river power to the U.S. for enough money to give us two million horsepower free from Mica creek, somebody else will build the Columbia, but not us," would the minister say whether he has any information to give the house?


Hon. Donald M. Fleming (Minister of Justice):: No, sir.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of Finance. Will there be an announcement this week concerning the unfreezing of civil service pay increases?


Hon. George C. Nowlan (Minister of Finance):: No, Mr. Speaker.



WAYS AND MEANS

[Stage Direction]
The house in committee of ways and means, Mr. Chown in the chair.

[Stage Direction]
Resolved,-that it is expedient to introduce a measure to amend the Income Tax Act to provide among other things:
1.	That for the 1962 and subsequent taxation years the amount deductible in computing taxable income in respect of a child qualified for family allowance be increased to $300 and the amount deductible in respect of other dependants be increased to $550 each.
2.	That with respect to income earned after March 31, 1962 a corporation whose principal business is manufacturing or processing (not including a
[Mr. Speaker.)
corporation whose principal business is shipbuilding, mining, logging or the operation of oil or gas wells) be allowed to deduct from its tax otherwise payable an amount equal to 50 per cent of the tax on the first $50,000, of its taxable income attributable to increased sales and an amount equal to 25 per cent of the tax on the remainder of its taxable income so attributable.
3.	That with respect to its first taxation year ending after April 10, 1962 and the next succeeding four taxation years a corporation be permitted to deduct in computing income 150 per cent of the amount by which expenditures of a current and capital nature on scientific research in Canada incurred by it in the year exceed expenditures of a current and capital nature on scientific research in Canada incurred by it in its last taxation year ending on or before April 10, 1962.
4.	That for the 1962 to 1966 taxation years both inclusive the deduction from tax allowed to corporations in respect of taxable income earned in a province be increased from 9 per cent to 10 per cent in a prescribed province in which arrangements exist for the replacement of federal grants to universities by additional provincial grants in accordance with the proposed amendments to the Federal-Provincial Fiscal Arrangements Act.
5.	That with respect to taxation years commencing in 1962 a taxpayer be allowed a deduction from tax on an amount equal to the lesser of two-thirds of the amount payable for the year to a province as a tax on income from logging operations or i of 10 per cent of the taxpayer's income from logging operations in the province, and the right to deduct in computing income amounts paid to a province as tax on income from logging operations be repealed.
6.	That with respect to expenses incurred after April 10, 1962 any corporation be allowed to deduct in computing income the drilling and exploration expenses, including all general geological and geophysical expenses, incurred by it on or in respect of exploring or drilling for petroleum or natural gas in Canada and the prospecting, exploration and development expenses incurred by it in searching for minerals in Canada not exceeding its income for the year from oil or gas wells in Canada.
7.	That with respect to expenses incurred after April 10, 1962 an individual be allowed to deduct in computing income the drilling and exploration expenses, including all general geological and geophysical expenses, incurred by him on or in respect of exploring or drilling for petroleum or natural gas in Canada not exceeding his income for the year from oil or gas wells in Canada.
8.	That with respect to acquisitions after April 10, 1962 amounts paid by
(a)	a corporation whose principal business is production, refining or marketing of petroleum, petroleum products or natural gas, or exploring or drilling for petroleum or natural gas, or mining or exploring for minerals,
(b)	an association, partnership or syndicate formed for the purpose of exploring or drilling for petroleum or natural gas,
(c)	a corporation (other than a corporation that qualifies under (a)), or
(d)	an individual for a right, licence or privilege to explore for, drill, or take petroleum or natural gas in Canada shall be classed as drilling or exploration expenses for purposes of computing deductions from income.
9.	That with respect to sales of property acquired after April 10, 1962 there shall be included in the income of a taxpayer any amount received as consideration for the disposition of a right, licence or privilege to explore for, drill for or take petroleum or natural gas except where the right, licence or privilege was acquired by inheritance or bequest.

10.	That the right of a successor corporation to deduct drilling, exploration, prospecting and development expenses incurred by a predecessor corporation from the income of the successor corporation attributable to the production of petroleum or natural gas from wells, or the production of minerals from mines, situated on property acquired from the predecessor corporation shall not be lost by reason of the fact that the successor corporation assumed liabilities of the predecessor corporation.
11.	That a joint exploration corporation may renounce an appropriate share of the drilling, exploration, prospecting and development expenses incurred by it after 1956 in searching for oil, gas or minerals in Canada in favour of a shareholder corporation whose principal business is
(a)	production, refining or marketing of petroleum, petroleum products or natural gas, or exploring or drilling for petroleum or natual gas,
(b)	mining or exploring for minerals,
(c)	processing mineral ores for the purpose of recovering metals therefrom,
(d)	a combination of
(i)	processing mineral ores for the purpose of recovering metals therefrom, and
(ii)	processing metals recovered from the ores so processed, or
(e) fabricating metals,
and in such case the expenses renounced shall be deductible by the shareholder corporation and not by the joint exploration corporation.
12.	That the right of a successor corporation to deduct drilling, exploration, prospecting and development expenses incurred by a predecessor corporation from the income of the successor corporation attributable to the production of petroleum or natural gas from wells, or the production of minerals from mines, situated on property acquired from the predecessor corporation be extended to a second successor corporation which has acquired the property from a predecessor corporation which was itself a successor corporation.
13.	That for the 1962 and subsequent taxation years income earned in Canada by a non-resident corporation whose principal business is mining iron ore in Canada, be exempt from the additional 15 per cent tax imposed by part IIIA on profits earned in Canada by non-resident corporations.
14.	That where an employee who is a member of one deferred profit sharing plan becomes a member of another deferred profit sharing plan the amount to his credit in the first mentioned plan may be transferred to his credit in the second mentioned plan without attracting tax on the amount so transferred.
15. That the amount to the credit of an annuitan' under a registered retirement savings plan may bt transferred at any time before the maturity of the plan to another registered retirement savings plar °f, to . ,a registered pension fund or plan withou attracting tax on the amount so transferred.
Mr. McDonald (Hamilton South):: Mr. Chairman, last evening I was discussing some of the attributes of the Liberal party. I do not think I need go any further than the remarks I made in the three minutes I had last evening. I would like to dwell for a moment-


An hon. Member:: That is about all you can find, three minutes worth.


Robert Matthew Turnbull McDonald: I beg
your pardon?


An hon. Member:: I said that is about all you can find, three minutes worth.
Ways and Means


Robert Matthew Turnbull McDonald: I would like to dwell for a few moments on the five star proposal of the hon. member for Lau-rier. The hon. member indicated the program of the Liberal party, which appears on page 5 of the translation section of Hansard for yesterday. I am going to deal particularly with two of the measures the hon. member indicated his party was proposing and what they intended to do. But the thing I find lacking is this; the hon. member makes pronouncements with regard to what should be done, but he does not say how they should be done.
The second proposal of his party's five star program is to establish a loan fund for the municipalities to help the local improvements situation. All through the context of the Liberal proposals there is evident the degree of centralization toward which the Liberal party is moving. I think the proposal relating to municipal loans has been undertaken by this government. They have made available to the municipalities, as an example, great amounts of money for vocational schools, which is something the Liberal party did not see fit to do in their reign of office, although they knew all the time that coming into the labour market would be the war babies of the last world war. Indeed, hon. members will remember the speeches we had the other day with regard to older employees, those over 45 years of age, and the need to retrain these people to fit into the automation era that is facing us.
The other point I should like to mention with regard to municipal financing is that this government took a very definite stand in this regard by raising the limit of insured loans under the N.H.A. act so as to enable a home owner to purchase a larger home. In the province of Ontario, where the municipalities have subdivision agreements, this has enabled a home owner to reduce his down payment and finance services under the cost of a home. The limit set by the previous Liberal government of $12,800 was immediately raised by the Conservative government to $13,800 and then to $14,400. This indicates the way in which this government has helped municipalities so they would not have to go into the debenture field and finance their projects in that way from time to time.
As far as other services are concerned which the municipalities need and where help has been given by the federal government, there are the harbour development and sewage disposal loans. We do not hear very much from the opposition about certain things. They brush over all these things that have happened in the past. I think the municipal loans program for sewage disposal plants was a great step forward by this government.

Ways and Means
Another subject upon which I should like to dwell for a moment or two in my short remarks concerns the housing and slum clearance proposition as put before the committee by the hon. member for Laurier in section 3 of his proposals. He indicated that there should be an extension and an increase in the financial share contributed by the federal government toward slum clearance and urban renewal projects in Canada. Apparently in the years when the Liberal government held office they did not recognize this fact; they did things in a very piecemeal way. The facts and figures prove this. From 1946 to 1956 the government of the day, recognizing the great need for urban redevelopment in the country, had projects under way amounting to $7,800,000. From 1957 to 1961 this government, through the Central Mortgage and Housing Corporation, instituted eight projects amounting to $15,800,000, and this year three other projects are going ahead to the tune of almost $3 million. But a clear indication of the responsibility which this government is assuming toward urban renewal is the fact that during the period from 1946 to 1955 the Liberal government had five studies on urban renewal, whereas in the last five years this government has undertaken 33 such studies.


An hon. Member:: Yes, but what action?


Robert Matthew Turnbull McDonald: I hear a voice from the people in the corner. It is my understanding that the Saskatchewan government, until very recently, would not even participate in federal contracts with regard to urban renewal. Only Ontario, under a Conservative government, would participate in federal contracts to the tune of 25 per cent, and this great premier who is coming into this house-the hon. member for Port Arthur says "untrue". He will have a chance to get up and debate the situation. I only want to point out that urban renewal is a subject of great interest to many people besides the Leader of the Opposition, who was a member of a government which seemed to do little or nothing in this regard. The hon. member for Essex East shakes his head as usual. I do not know of any studies taking place in Windsor harbour in the three years before 1957.
Hamilton is an ambitious and progressive city. At present we have a comprehensive study going on, and we should be forwarding an application to the federal government in a very short time. Opposition speakers seem to forget that the provinces and the municipalities have a responsibility for engaging in urban renewal. The provinces across Canada must themselves give permission before any work can be done in agreement with the federal government. Notwithstanding this, the

Leader of the Opposition allows people to believe that the Liberal party would take over the whole thing should it come into power. If it does intend to do that it must change the whole constitution so that the federal government may exercise direct control from a central position.
The problem of urban renewal is not just one of money. If a municipality does not wish to take its own responsibility for the clearing of an area, the federal government is, I think, helpless to institute a program. It cannot impose an operation which the local authority may regard, after consideration, as not being in the best interests of a municipality. I have had the pleasure for the last two years of serving on a committee set up to explore the ramifications of urban renewal in Hamilton involving some 270 acres, not, by the way, in my constituency.
As I said, it is not money which presents the only problem. Part of the difficulty is presented by the contacts and negotiations which must be set up with so many differing authorities. It is very gratifying to see that the government of Ontario is in touch with the federal government every day in this regard, and that the federal government is paying 50 per cent of the cost of these projects in Ontario, 25 per cent being paid by the provincial government. The announcement by the opposition that they are going to extend something they never did before is a vain way of trying to escape their responsibility for not having taken action in the past.
In the field of housing in general, this government can assume full credit for the steps it has taken in helping the municipalities and the people of Canada to go ahead and build homes, not only in the home purchase area but in the rental accommodation area. It is very clear to me that in every phase of housing activity the present government has discharged its responsibility and taken action which will be of benefit to Canada.
I have already mentioned the urban renewal studies, the urban renewal programs and the sewage treatment loans. I should like to point out what has been done in the limited dividend field. This is a field in which the federal government lends money to municipalities or private entrepreneurs for long terms so they can build accommodation for people in the lower income groups, those between the limits of $3,950 and $4,200 a year, and indeed for people who are senior citizens and in income brackets well below $1,500 a year. This is indicative of the broad program this government is developing and pushing forward.

It is also well to note that the home improvement loan plan, which was discussed before the orders of the day were called, has been accelerated by this government. Up to 1957 some $57 million had been put up by the late Liberal administration. In the past five years some $180 million has been allocated in this direction. However, the direct lending of this government or of C.M.H.C. has been one of the best things that has been done in the past five years. Up to the end of 1961 some $1,225 million had been put into the direct lending field in addition to the figures I have given previously.
In reading or in listening to the debates of a few years ago when the trade and commerce economic report was revealed to the House of Commons, in which it was clearly indicated that there would be a cyclical decline in the housing industry in the early stages of 1957, the thing that surprised me was that the Liberal government when going into an election just did not do anything about it. If it had started to take its responsibility seriously in this field I think the problem of employment in the early stages of the recession would have been overcome to a great extent.
There are many other things that I might like to discuss today, Mr. Chairman. However, there is one thing in particular that I should like to point out, namely the way in which the Liberal party is going in the House of Commons. The hon. member for Coast-Capilano made a remark the other day. At the end of his speech he said that he had been tutored by the greats of our time, namely C. D. Howe and Walter Gordon. In his remarks he indicated that the system should be streamlined by taking the tax burden off the shoulders of the producers and putting it on the shoulders of those who merely consume. It was very indicative to me that it was the Liberal party of old that was talking, because the only way in which you can tax the consumer is by imposing sales tax and excise tax on the commodities that people buy from day to day. I think the people of Canada as a whole will realize that the old masters of the Liberal party of old are creeping back into the political situation in the country, and are doing things they have done in the past.
I was very much interested to hear the hon. member for Essex East praising the productivity council and prodding the government to examine the report of the productivity council when it is brought before parliament. I seem to remember that when this measure was introduced into the House of Commons some years ago the Liberal party and indeed the members of the socialist party apparently scoffed at it and thought it was
Ways and Means
not a very good thing. They were scoffing at this government trying to better management and labour relations so that we could improve our industrial section of the community through co-operation. I am very happy to see that this member who seemingly criticized this step previously is urging the government to look at this report in the hope of benefiting the workers and the industrialists of the country as a whole.
I think it is quite a shame for some of those who have spoken in this House of Commons to have used such language as "fraud" and to have been responsible for many other strange things that have been going on. I mentioned one thing last night. I wish to touch on this matter for one moment before I sit down. The Liberal party seems to have said in the election, "We will look ahead; we will not look behind". However, I think it is well to look behind with regard to the remarks made by the hon. member for Laurier and the hon. member for Essex West in talking about the party in the corner in relation to certain things that happened during the war. I seem to remember as a very small boy a great, responsible Liberal party not facing up to the conscription issue during the war. I really think-and I really believe this-that it was not that they were deciding whether conscription was right or wrong-this is what I am talking about, namely political fraud-but rather that they did not wish to put conscription into effect merely in order to save votes in one segment of the country. I think this was the greatest fraud ever perpetrated by any government in the history of Canada.
(Translation):


Mr. Belanger:: Mr. Chairman, although I am somewhat of a reformist, I agree that there are certain traditions which deserve to be respected. Among these, is the practice of congratulating the Speaker, through you, for his elevation to such a highly responsible post.
There is another tradition to which I wish to conform; it was initiated by the previous member for Charlevoix. I wish to dwell in my maiden speech, on the beauties of the great constituency which I have the privilege of representing. My constituency is bounded to the south, on its whole breadth, by the noble and majestic St. Lawrence river, which in that section, is so wide that it affords some suggestion of the splendid expanses which it crosses.
By the way, I must point out that the constituency of Charlevoix should be called Charlevoix-Montmorency as it comprises two counties.

Ways and Means
This district which includes high mountains and high plateaus ranging away from the St. Lawrence, is studded with small towns, villages and parishes, and is embellished with many well-stocked lakes and streams which make it a haven for the fishermen. But there are still some large wooded areas which supply the raw materials to the only two large industries in my riding, the newsprint plants of St. Anne Paper Co. Ltd., in Beau-pre, and the Donohue Brothers, in Clermont. There are also encouraging signs of a wealth of minerals underground.
Mr. Chairman, in that magnificent constituency that I have just outlined as far as its geographical formations and its natural resources are concerned, live some 50,000 people, the majority of them in dire poverty and misery. I know, because I crossed the riding in all directions, and I have met with many people in all walks of life, that there are numerous slums there and families by the hundreds live on the meagre allowance meted out to them by the social welfare agencies. Besides, what applies to my constituency applies unfortunately to the great majority of ridings in Canada.
The majority of the population in Canada live in poverty, while the present production is abundant and the possibility of a greater production is demonstrated by the great number of unemployed in this country. We, Canadians, have the right and the means to enjoy the highest living standard in the world, due to the diversity and extent of our natural resources as well as to the excellent organization of our production system. And all this, incidentally, is due to private enterprise.
In the speech from the throne, as has been the custom in the past, we were told of measures to promote exports of our products to other countries. When at last shall we have a government willing to look around and find out that we have here in this country's population an open market, willing to use at least a very important portion of the production we wish to export elsewhere.
To develop this natural market, all we need is to provide Canadians with the proper purchasing power since that is what they are waiting for to consume our commodities and produce some new ones. Why should it be a good thing to grant credit to foreign countries in order to help them buy our products if it is bad to do the same thing

for the Canadian people. We already have the necessary means for redistributing purchasing power. All we have to do is to raise family allowances, disabled pensions and all other pensions paid under the existing social legislation, and if that is not enough, we could add a national dividend. In my opinion, those steps to increase the purchasing power need no justification. Common sense and plain social justice tell us that it is ridiculous to keep family allowances at about the same minimum level which was established in 1945. Why are we afraid of doubling family allowances and of revalorizing them? Why should we hesitate? Our families can put the money to good use.
In my riding, a great many heads of family earn only $30 to $40 a week, that is when they are not out of work. I wonder if the government we have supported until now to enable them to find a prompt solution to the problem, realize what it is to be unemployed. A man who is out of work is not just a number; he is a human being with pride and honour, with a family he loves with all his heart.
Through its lack of dispatch in taking the emergency measures required to change that situation, I wonder whether the government realizes that it is not only lowering and humiliating the jobless as well as causing him, his wife and children some physical harm, but that it is also ruining that first and most important cell in society, the family.
What is beyond me is that the government did not hesitate to take strong but unpopular measures to save the dollar. Why is it that it hesitates so much to take the measures needed to save the families? What is more important in the country: the human capital or the financial capital? The family or the dollar?
Mr. Chairman, I think that in order to be able to treat an illness intelligently, one must know at least the cause of it.
I do not know if the present government, as the previous one, really knows what are the causes of unemployment. Here are a few which I consider to be the main ones.
First, a relatively faster increase of the work force in the last 30 years or so. In fact, through its discoveries, medicine has made great strides and it now enables doctors to save a much greater number of babies at birth. The babies of 25 years ago have become today's new manpower; they consti-

tute the ever-increasing number of workers who enter the labour market every year.
There is also the reduction of exports. During the post-war years England and the European and Asiatic countries produced relatively little, and they exported even less because of the destruction they had endured. Today, however, they have reorganized their industries, they are producing at full power and, because of their low standard of living, they can undersell us and compete with us most aggressively.
All countries follow the absolutely ridiculous principle of economic liberalism which states that one must export or die, as if a higher standard of living could be achieved by emptying a country of all its goods. What happens is that exports are becoming increasingly difficult because everybody wants to export rather than import.
In addition, the replacement of man by machinery is a very important factor. About 50 years ago, the human energy used in production was 20 per cent, today it is only 3 per cent. Moreover, because of centralization of production in large plants and because of the fact that work is specialized, to the point that one plant will manufacture only one product, more machinery is being used and automation has reached such a degree that nowadays plant workers are mere robots who repeat constantly the movements dictated to them by their machines. This is a further illustration of how matter dominates spirit, a situation which is on the increase in every field and which our materialistic socialists would like to develop even more with their planning.
And now sale prices. Prices, inflated by taxation, are going up all the time and are getting out of reach for an increasingly larger number of people; products remain unsold and that results in what is called overproduction. However, that is not so in many instances but rather a case of underconsumption.
There is also another factor causing unemployment. It is the impossibility to purchase all that we can produce. There is a difference between the cost of an article and its sale price-and here I do not take into consideration the profit which is redistributed. In establishing a sale price there is an element taken into account which is not distributed because it does not exist, and that belies the
Ways and Means
principle so dear to the economists that consumption finances production. That factor is the interest paid on money borrowed in order to produce such an article. This interest is not created by anybody, but it must be paid nevertheless. Chartered banks create credit and destroy it, but they never create interest.
Mr. Chairman, it is absolutely normal to say that if I borrow a bag of potatoes to sow them, I could be in a position to give back two bags or even more because it is natural and normal for potatoes to multiply. But for dollars it is entirely different and with St. Thomas Aquinas, I say that dollars cannot breed. In other words, let us take a concrete case-


Mr. Martin (Essex East):: Do you speak of St. Thomas Aquinas?


Louis-Philippe-Antoine Bélanger: -which applies to every industry. Take for instance a man who borrows $10,000 at, say, 5 per cent and who invests the amount in a shoe store. This man puts into circulation $10,000 after undertaking to repay $10,500 a year later, when he has only $10,000. It is an impossible proposition and it goes against any arithmetic system to turn this around to $10,500, but if the man can succeed in raising the $10,500, it will be due to several factors and also because somebody else will have gone bankrupt. In other words, a debt will have been born which in turn will bear interest and so forth. The vicious circle will go widening and debts will also accumulate.
Because all money in circulation is money that has been borrowed some day or other at interest, all those who put money in circulation want to get back more than they have invested. This turns around a physical impossibility and in the end it generates overproduction and debts. I would rather say that it engenders underconsumption and consequently unemployment. On the other hand, gentlemen, one should not draw the conclusion that we are against interest on personal loans; we are not, and it is precisely because we are not against interest that we are advocating monetary reforms which would solve the problem already submitted to the house.
Mr. Chairman, let me tell the government that there is a way to solve the unemployment problem. But if they are reluctant to

Ways and Means
face all at once the unemployment problem, they should at least try to find a solution to the problem of the unemployed.
To understand exactly what is this problem of the unemployed, one has just to compare two unemployed workers. The one is unemployed because he wants it that way. Let us suppose that due to certain circumstances, his parents left him enough money to enable him to lead an honourable life without having to work for a living, nobody will blame him for not seeking a job.
As far as he is concerned, there is no need to recall the famous law of work from the Genesis, which reads as follows: "In the sweat of thy face shalt thou eat bread" because that does not apply in his case. Our first unemployed provides for his family, he has no financial problems, he is happy and does not bother the government.
But our second unemployed is not working because he is unable to find any work. He has no money, he has to beg for a meal, and the government nearly goes broke investigating whether or not he actually is about to die of hunger; and before he is granted anything, he is warned not to ask for too much because the Bible says: "In the sweat of thy face shalt thou eat bread". That applies to him, for he can hardly eke out a living for his family. That becomes an acute problem for him, and he is an acute problem for society. However, Mr. Speaker, these two unemployed are two human beings alike, the two families are alike. The only difference between the two, luckily for the former and unfortunately for the latter, is that one has money and the other is without it.
So the logical solution for the government is to try to solve this problem by increasing the purchasing power of the latter so that both will be happy. That is the Social Credit's solution. Up to now, the other parties, including the socialists and communists, have sought an answer by taking money away from some people, through taxes, in order to give it to others. In this way, instead of distributing wealth, they distribute poverty and tend to level all social classes by downgrading them.
That is why we suggested to our electors during the last election campaign-and we are now asking the government-to introduce as soon as possible an imaginative program of which I should like to point out a few items that I feel are most urgent.
One of the reasons for our supporting this government up to now, is that we wanted to give them an opportunity to provide assistance without delay to the unemployed who

expect a great deal from the government. The survival of the government depends to a large extent on the legislation passed in the next few months.
That is why, Mr. Chairman, we on this side are asking, on behalf of the people:
1.	Increased family allowances.
2.	Increased old age pensions, and the age limit brought down to 65 for everyone. Furthermore, we should like to see abolished that anomaly according to which when one of the spouses has reached the required age and is otherwise eligible for old age assistance, while his spouse is not, both are condemned to live on a pension designed for a single person. I wonder where is common sense and logic in that. We are therefore asking that, whenever the head of the family is entitled to the old age pension, his spouse, even if a little younger, be eligible also.
3.	Increased tax exemptions, from $2,000 for married persons and $1,000 for single persons as they are now, to $5,000 for a family and $3,000 for unmarried people. For several other reasons, such a change is justified by the fact that the exemption, when established was to represent a vital family minimum and that any tax over and above that would be unfair and exaggerated. Now, since then, the dollar has depreciated so that what could be bought at the time for $1,000 now costs $2,000. That principle is so true that it has been recognized by the Liberal government, when it decided to grant a $4,000 exemption to members of parliament. I do not think any single member has criticized that action, which was in fact quite justified. But what is logical and good for members of parliament is just as good for workers and farmers. We are asking for such a measure but we do not want its implementation to result in increased taxation or increased debt.
I thought that this statement would have brought our main opponents, the Liberals, to refer to "funny money". When I say "our main opponents, the Liberals", Mr. Chairman, I do not mean that they are more important than the others but, since the beginning of this session, intense fire on their part has been aimed at our group, as if we were responsible for the present economic situation.
I am not complaining about those attacks; on the contrary, they have made me realize that their methods and their political tactics

are the most devious, the most hypocritical you can find in this country, which I suspected in any case.
Our English speaking friends have a nice little word to describe them-they call them "snaky". Their attitude toward us, especially during the debate in reply to the speech from the throne consisted in trying to have the public believe that they wanted an election, while we know-everyone knows it, and they know it best-that they did not want any. In fact, every Liberal who has made a speech has invited us to vote with them, but their invitation was an insult to our group. They wanted to make quite sure that we would not vote with them.
You have a good example of that in the typical speech made by the hon. member for St. Jean-Iberville-Napierville (Mr. Dupuis). It seems obvious that he is the one responsible for our education and quite often he will brand us as ignorant, using different words to that effect. Well, in his speech, in a great flight of oratory, he referred to "consignats". Mr. Chairman, I looked everywhere in Larousse and Quillet, I could not find that word. Does it mean that he is more intelligent than we are, just because he found that somewhere?


An hon. Member:: That is right.


Louis-Philippe-Antoine Bélanger: In this corner, we readily understood that he only meant to insult us so that we would not vote with his party.
On the other hand, the hon. member for Niagara Falls (Miss LaMarsh) took it upon herself to try to put our conscience at ease and urge us to vote with the socialists.
She quoted an item from the Ottawa newspaper Le Droit which reported a statement made by a Catholic bishop, and that, just after she had dwelled upon socialist planning. This was intended to have us believe that the bishop recommended socialism. I daresay that we have our own guides in this matter and, to quote but one "Quadragesimo Anno", where his holiness Pope Pius XII stated, under the heading "Changes in Socialism" the following:
Catholic and socialist are contradictory terms:
If, like all errors, socialism contains a certain element of truth, it is nevertheless founded upon a doctrine of human society peculiarly its own, which is opposed to true Christianity. "Religious socialism", "Christian socialism" are expressions implying a contradiction in terms. No one can be at the same time a sincere Catholic and a true socialist.
Before I conclude, I should like to come back to the famous phrase "funny money" and give you a definition of it. Talking about
Ways and Means
funny money, I must say that I see on my right, in this house, funny members who do not seem to know what funny money is. I know that coming from me a definition would not give them satisfaction, so I took the trouble of finding one which is not my own but was given by a citizen of Toronto in a Toronto newspaper. Here it is:
( Text):
Aside from gold, Krug turns his attention to the nations that favour other forms of money, such as silver, copper, nickel, zinc, aluminum or iron.
Such nations, he says, issue notes, either directly or through their central banks. Unless it is backed by gold, such money is usually referred to as printing press money, fiat money or funny money. Whether the notes or currencies are designated francs, lire, drachmas, pesetas, rubles or dollars, they are simply names representing a certain weight of gold for international use. When gold disappears the currency becomes unsound, unstable and destined to lose value in terms of the rural money. Gold is the final measuring rod by which the various commodities and currencies are compared and exchanged.
(Translation):
And the strangest thing of all is that "funny money" is supposed to be money not guaranteed by gold.
Now in reply to a question asked by a member of our group, we were told that at present there was no gold to guarantee our money. Hence it is true that the money we have at present is "funny money".
Who gave us "funny money"? One thing is certain, it was precisely those who talk about "funny money" today, that is, since 1940, when the Liberals were in power and passed legislation to abolish the obligation to guarantee money with gold. We have had "funny money" ever since. There is no need to look elsewhere.
There is another short article that the government could usefully hear. The same Mr. Krug says:
(Text):
Mr. Krug says the financing of federal deficits is easily accomplished because the money system, for domestic purposes, is no longer fully tied to gold. Today a dollar, for domestic use, is merely an engraved piece of paper which the government or its controlled central bank has the exclusive right to print. It is a promise to pay nothing.
(Translation):
Mr. Chairman, I am just a white collar worker, if you want to call me that, but as I wish to be of service to my country, to my province and to my riding, I dare give the government the following warning: an economic system which, after 100 years of operation, leaves a federal government over

Ways and Means
its head in debts, provincial governments, local governments, school boards covered with debts, an economic system which operates properly only in wartime, such a system is obsolete, unsuitable, inadequate and, as was advocated, that you have nothing to lose by replacing it as soon as possible.
The sooner the government decides to act upon our suggestion, the better it will be for them, the country and for each and every citizen.
On the other hand, I should like to say here something very personal which I have never discussed with members of my party but, before doing so, I should like to make it clear that this is only a personal opinion.
In all sincerity, I want to warn the English speaking press in Canada that it should not ignore the existence of a separatist movement in Quebec at the present time. True, that movement may not yet threaten national unity and our group has no separatist tendencies, for the time being.
However, if Canadian newspapers in the English language persist in turning into ridicule and most shamefully misrepresenting we Social Credit members as a backward group, if they keep on lying to the people about Social Credit and denying us the right of having our doctrine and our actions interpreted faithfully, our country will greatly suffer from it. In so doing, the press will stir up strife between people of both cultures and cause our group to become separatist. When we lose this hope of being understood by all Canadians some day, a hope which guides us today, it will then be very easy to go through the province of Quebec, preaching and practising separatism and establishing Social Credit, which will enable us to give Quebeckers what we want for all Canadians.
As far as I am concerned, my patience is coming to an end and if, within a few months, I see no improvement in this disparaging campaign by English speaking newspapers, I shall be the one to make that proposition to my party.
Mr. Chairman, before concluding my speech I should like to make once again, but in a different way, a proposition I made to the government.
Last week end we were on the brink of war. And I ask the government: if war had actually been declared would the government have found the money required to carry on?

Undoubtedly, we would have found the money for our defence, it is sure that we would have taken the necessary steps for the protection of our country, our way of life and our freedom.
Now, is it not just as important to defend our families and our children and prevent them from dying of hunger in a country of plenty. In closing, I ask the government to act as soon as possible in order to cure this disease of our civilization which pretends to be refined and progressive, while it lets unemployment plague the country.
(Text):


Mr. Lewis:: Mr. Chairman, at this stage I want to add a few words to some of the suggestions made by hon. members of this group during the course of this economic debate. I appreciate that a great deal of ground has already been covered by a good many hon. members, but I want to try to deal with some points which, in my belief, are of importance to our country and which have not yet had the attention from the government which they should have had.
It is of course true that economic conditions in Canada have improved this year, and the Minister of Finance derived a great deal of satisfaction out of that. It would be rather mean to begrudge him the little bit of consolation he could get out of a rather difficult situation and difficult task, but the fact is that the year 1962 represents the upswing of the economic cycle and that improvement was bound to come. The much more important truth for Canada and the Minister of Finance is that all the indicators, both here and in the country to the south of us, show that 1963 will again see a downturn of economic activity. The duty of this government, as of any government under similar circumstances, is to plan our economy so that we can meet the situation which will arise next year.
All economic indicators have put up these danger signals about next year and, whatever the minister may say for political consumption, I have learned in my short sojourn here in this chamber to respect his intelligence enough to feel certain that he knows as well as I or anyone else, that there are danger signals ahead and that there will be difficult times which we will have to deal with when we come to the turn of the new year.
However, in order to make the picture even better than it is the minister engaged in a little bit of statistical sleight of hand. For

instance, he kept on comparing the figures for the second quarter of 1962 with those for the first quarter of 1961. I am sure he knows that is a thoroughly bad way to look at statistics and that it is utterly wrong to present such comparisons. I suppose he was on a search for little points of consolation, and again it would be mean to begrudge him that satisfaction, but I would like to point out what happens when he engages in that kind of comparison.
He informed us that the gross national product in the second quarter of 1962 was almost $4 billion higher than in the initial quarter of 1961. That is quite true; but if he had compared-as he should have done and as any economists advising him would have told him to do, if they did not in fact tell him-the second quarter of 1962 with the second quarter of 1961, he would have found that the increase was only $2.9 billion rather than the $4 billion he was talking about.
There are other similarly intriguing sleight of hand bits throughout the minister's presentation and the statistical comparisons which he made. Neither I nor the other members of this group are concerned with that kind of exercise, innocently and charmingly as it may have been carried out-at least charmingly.
The point we in this corner have been trying to make to this house and to our country is that Canada faces a long term problem of unemployment and the long term problem of evolving a program that will expand our economy to meet that unemployment. The point we have been trying to urge upon this house and the country is the need for a modern approach to the role of government in our society.
Look for a moment with me, Mr. Chairman, at the cuts in the revised estimates. Look at the $8.5 million cut in our contribution under the Colombo plan. This represents a 17 per cent cut out of the niggardly total of $50 million for this international aid program. I say to this committee, I hope not offensively, that this reduction is not only an act of meanness in a world which cries out for generosity, but it is also harmful domestically because our contributions to the Colombo plan, as the Minister of Finance well knows, are mainly made in goods and services. Therefore, this cut does not save us any foreign exchange, and is another little contribution to the slowing down of our economy in Canada.
Look at the savings in construction which go right through the revised estimates. Almost half the total reduction of $228 million is composed of reductions in capital expenditures; and about two thirds of that half are in construction programs. I had occasion to
Ways and Means
suggest the other day when first speaking to this house, and I repeat, that a first year economics student would have informed the minister and the government that construction programs are most important in an economy because of the multiplier effect they have in the jobs they create, right down the economy to the steelworkers, the cement workers, the brick workers and the plants involved therein; and because of the multiplier effect they have in the way in which the income distributed to the workers at one end is multiplied in the hands of a number of workers down the line. Yet the government at this stage, with the rate of unemployment we have and with the low rate of growth in the economy, does what is to me an incredible act of not only reducing the estimates but reducing them in the one sector where the effect on the economy would be worst. If anybody can suggest to me a more stupid approach to the program-and I use that word after hesitation, because I think it is the correct word-I would like to hear it.
I ask, Mr. Chairman, that you look at some of the other cuts; the cut in hospital construction by nearly $2J million; the cut in payments to and construction of hospitals for Indians and Eskimos by more than $1 million, or about 40 per cent. Again I say this is not only an act against the social conscience of the country, but it is also harmful to the economy for the reasons I have given.
If that was not enough, one was utterly flabbergasted on studying the reductions in the estimates to find cuts in capital expenditures in the Atlantic region, of all areas of Canada; cuts in transportation expenditures and in building estimates for a region where unemployment has been at its highest, a region which requires more and more job opportunities. Yet the minister deliberately takes government steps to cut the number of job opportunities there. And he is a Nova Scotian, as I was just reminded. I suppose that shows his even-handed way of dealing with Canada's problems.
The only thing that saves the reductions in the estimates from being an absolute disaster for Canada's economy is the fact that $228 million is a relatively small factor in the total of economic activity both public and private; but in principle, and when these cuts are taken in the context of the rest of the government's policy, disaster is not too strong a word to describe what is before this house at the present time.
Mr. Chairman, some of us in this corner of the house before we came to parliament- and some of us who have been in parliament for some years-have often been accused of being doctrinaire in our views about the

Ways and Means
economy. I want to say to hon. members through you, Mr. Chairman, if I may, that as I have listened to the major spokesmen of the two major parties in this house and read their speeches I have come to the conclusion, as I think any objective observer would, that they and not we are the real doctrinaires in this house.
Throughout their speeches you find a blind, illogical, traditional adherence to the private enterprise myth in our economy. It is a myth, because it does not exist; because the private enterprise sector is in the hands, for the most part, of large corporations; because the outstanding characteristic of our present economy is either monopoly or oligopoly. It is not the small, private entrepreneur who is of importance in our economy in 1962. Yet no speaker of the major parties on either side of the house has been able to suggest any planning where he will not immediately pull himself back, as did the hon. member for Davenport and say-I am not quoting him but this is, I am sure, not a misrepresentation of what he said-"I want you to understand that even though I stand for planning, I do not mean that there should be any public spending in competition with private enterprise. Nor do I mean that planning can be done any better by the public agencies." In fact, said he, "The best way of planning in our economy, when our economy works best, is where responsibility for economic decision is kept in private hands."
That kind of statement by an hon. member, if I may say so, who made an analysis of the economy of great value to hon. members of this house, could only be made by one who is so completely blinded by a doctrinaire approach to our economy as to be unable to see the avenues along which intelligent planning and intelligent direction must take us, perhaps blinded by his connections as well as by his theory.


An hon. Member:: Why don't you read the whole thing?


David Lewis: I read the whole thing. On the other hand, the group immediately opposite us are of course in a separate category. They have become not only blinded by doctrinaire orthodoxy; they have become the high priest of the worst in our economy and in our present system. I notice, for example, that some time ago the hon. member for Villeneuve, who is not here today, as he was not here yesterday-I wish I could have said it in his presence-was quoted as having said that Hitler is one of his political heroes.


Mr. Leboe:: I am glad you said "quoted".


David Lewis: It is in his words. Let not the hon. member run away from it.


Bert Raymond Leboe: I am glad you said "quoted".


David Lewis: That is right; and if the hon. member agrees that he was correctly quoted, that is what I am after. He was correctly quoted.


Bert Raymond Leboe: We do not agree.


David Lewis: The hon. member does not agree with the hon. member for Villeneuve; I am delighted to hear that. In fact I was certain there would be some members of the Social Credit party with a sufficient sense of democracy and real freedom to disagree with a statement as irresponsible as that.


Bert Raymond Leboe: You are twisting the words, sir.


David Lewis: I am not twisting the words. If the hon. member will wait he will hear my words, and I am sure he will see that I am not twisting them. The hon. member for Villeneuve was quoted in the French edition of Maclean's as having said Hitler is one of his political heroes. He later explained that what he meant was the economic policy pursued by the German government under Hitler during the 1930's, and not his political and dictatorial policies. I was interested to note in the Globe and Mail this morning, in a story about a meeting the hon. member for Villeneuve had at the University of Toronto yesterday, at the bottom of the front page, that someone asked him what were the economic policies of Hitler which he admired, and his answer was "I do not know what the economic theories were during Hitler's time in Germany".
I can only come to the conclusion that the hon. member for Villeneuve admired Hitler for his economic policies, about which he knew nothing. I say in all seriousness that this is an important key to the hon. member's mind; I regret he is not here. More particularly, it is a key to the hon. member's tongue, which is a great deal faster than the other part; and, perhaps, a key also to Social Credit theory as a whole, that you admire something about which you say you know nothing.
I respectfully submit, as does our party, that the approach of the government as well as that of the Liberal spokesmen will lead us into further difficulties. I suggest it is wrong to have private enterprise as a goal in itself, worthy in itself, just as it is wrong to have public enterprise as a goal in itself, worthy in itself.


Mr. Nasserden:: That is what you did.


David Lewis: No. You can have both. The hon. member has never understood what we are advocating.


Edward Nasserden: What about the Regina manifesto?


David Lewis: Oh, I could make a speech about the Regina manifesto and then, perhaps, the hon. gentleman would understand it a great deal better. If my words are not too presumptuous, I could also say something about Saskatchewan. However, if the hon. member does not mind, I propose to go on with the notes I have for my own speech.
I was saying it is wrong to have private enterprise as an end in itself, just as it is wrong to have public ownership as an end in itself. Both are means to an end. If I were asked to state the difference between views we in this corner hold and those of others in this chamber, I would state it in this way: at the present time in our economy, the major purpose of our economic activity is the profit of the industry involved, and social welfare is a hoped for by-product of that purpose. In my submission, that is standing society on its head. That is standing social morality on its end, destroying the social and ethical purpose of our community. What we require is a society where the major purpose of economic activity is social welfare, with private profit a hoped for by-product. If one turns the purpose around-


Mr. Pennell:: What was the purpose of the Liberal social program for 22 years?


David Lewis: The purpose of the Liberal program for 22 years was to stay in power; its purpose was to do enough to fool the Canadian electorate to elect them again. From the behaviour of hon. members opposite during this session I would think that the purpose of the Liberal party has not seen much change.
We suggest we must organize our economy so that the national welfare is its major purpose, and that in order to do this we must have an outlook which is as ready to tread on the toes of the big corporations as it is to tread on the toes of every other special interest-labour, farmers, lawyers and doctors; that there must be an approach to our economy which makes-and I use that word deliberately-the large corporations in the economy play a part in reaching the national goals and not a part only in making profit.


Mr. McIntosh:: What would happen if they all moved out?


David Lewis: Well, they could not all move out. But if there is a government which has inventiveness, then what there is of capital resources in Canada belongs to the Canadian people, and there are ways and means of making sure that they remain at the service of the Canadian people. I suggest that no corporation has the right to move out of Canada merely because the Canadian parliament asks it to serve a certain purpose, any
Ways and Means
more than any individual would be morally right in taking that attitude against a democratic decision of the parliament of Canada.
Furthermore, I respectfully submit that such a thing would not happen, because if the plan which we have suggested in this parliament were followed we would have full employment in this country and a much bigger opportunity for reasonable profit and for economic development than this country has ever known. In such conditions there would be no reason for corporations to leave Canada. Furthermore, they have not done so in the past in any part of Canada, no matter what government has been in power, and they will not do so in the future despite what the hon. member suggests.


Mr. Mclniosh:: They did in Cuba.


David Lewis: That interjection, if it was heard by the reporter and goes on the record, is an indication of the kind of irresponsible political viciousness which I had hoped we had got rid of on our Canadian scene.
There are two or three points in what is before us which indicate the difference in approach to these questions. There are, for example, the tax incentives which were suggested as a means of stimulating private investment. That was also in the statement made by the spokesman for the Liberal party. May I point out, as did my hon. friend from Nanaimo some days ago, that we already have excess productive capacity in the country, and that we are not going to produce anything worth while by further tax incentives for investment, because the investment is not needed.
May I illustrate this by a couple of examples. In current dollars, business investment on new fixed capital fell from $7.3 billion in 1957 to $6.5 billion in 1961, a drop of 11 per cent. Over the same period total business reserves or savings grew from $4.9 billion to $5.1 billion, an increase of about 4 per cent. So that at the same time that private investment fell, the reserves available for investment actually increased. Thus there is no need for any further tax incentives; the reserves are there.
Let me indicate another point. In 1950 depreciation allowances accounted for about 72 per cent of total business savings. That is already a high figure. By 1961 depreciation allowances accounted for 85 per cent of business reserves. Despite this, the amount of net private investment fell in 1961.
The same kind of criticism can and should be made of the proposal to remit taxes for increased sales. The way in which this scheme is now presented to the house means, I suggest, that a situation could arise where businesses which increased their prices would get

Ways and Means
the benefit of this remission of taxes whereas businesses which decreased their prices would not derive any benefit. Obviously when you put the tax remission on the basis of the dollar value of sales, you could actually have a situation where a business which increased the volume of its output but decreased the price of the product, would come out without any increase in the total value of its sales and, therefore, would not benefit from the tax remission. Surely what you want is a volume increase and not a price increase in sales.
Similarly, it should be obvious to hon. members that if you remit taxes on the basis of the total increase in the value of the sales, you can easily have a mere transfer of sales within the economy without a total increase in the economy at all. In other words, you could have an increase in the sales by A at the expense of B with the total result exactly the same it was previously, but A would get a tax remission and the economy would not be one whit better off.
May I also remind hon. members, if they need reminding, that every time our economy expands, economists have found that, on the average, for every 1 per cent of expansion of the gross national product there is about 1J per cent of expansion in the national revenue. Hence your problem of deficits can only be solved, in my submission-as has been said many times from this corner-in terms of a growing national product, and of an expanding economy which will result in expanding revenues for the federal treasury.
In addition to other proposals which have been made we wish to suggest the following in place of those which are now before the House of Commons. We suggest that instead of an increase in the personal exemptions in the income tax system, there should be a direct cut in the tax for the lower incomes. That action will immediately stimulate the consumption demand which is what you require in the present economy. You have got to attack our economy much more from the consumption demand angle than from the investment angle. It is the lack of purchasing power which is your major problem at the present time. You will meet that objective by lowering taxes for the low income groups. The suggested increase in personal exemptions is obviously a regressive and not a progressive way of doing it, since the same increase in the exemption applies to a man who makes an income of $30,000, $40,000 or $50,000 a year as to a man who makes an income of only $3,000. It obviously means a great deal more in actual tax saving to the man in the higher tax bracket than it does to the man in the lowest tax bracket.
We say, second, as we have said on many occasions, that the way in which to deal with the recession threatening next year is to increase government spending instead of cutting it and to increase it on the building of social capital. The estimates which were revised by the Minister of Finance in our view should have been revised upwards instead of downwards. I am sure that some of the expenditures squeezed out by the minister were properly squeezed out. As is always the case with every administration of whatever party, whether government or private, it gets into the habit of putting a great deal of water in the expenditures which ought from time to time to be squeezed out. I am certain that has happened in Ottawa as it happens in every other place. But subject to that kind of saving, I urge that the estimates should have been up and not down so that we would have had enlarged estimates for the building of hospitals and schools, universities and parks, recreation centres and roads, low cost housing and slum clearance and urban redevelopment; the public development and conservation of natural resources in association with provinces; technological and scientific institutions in co-operation with the provincial governments.
I urge that we need the building of homes for the aged across Canada, and expanded geriatric services at one end of the age scale as well as child welfare services at the other end. We also need an increase in the social security program, particularly for old age pensions and the portable pensions which we suggest.
All of these things, as we have had cause to emphasize, require over-all national planing in co-operation with all the agencies of government and of economic importance in this country. Everybody is now for planning, Mr. Chairman. As a matter of fact, government spokesmen and Liberal spokesmen vie with each other as to which one of them thought of planning first. However, what I mean and what this party means is actual planning for the input and output of the economy, on a three year, four year or five year basis as is thought desirable for the length of a parliament. What we mean is a plan which will be worked out in consultation with the provinces and with all economic agencies-capital, labour, farmers and the like -so that it will have the most democratic basis possible and which would incorporate the social and political goals of our society: higher education; social welfare; full employment; full utilization of the capital equipment in the country which we have now, and the building of additional capital equipment in order to provide jobs for new hands for whom we shall have to provide work in the next while.

These must be placed in a plan, we submit, of which the budget forms a part, so that the fiscal and financial policies of the nation fit into the structure of the goals which we set for ourselves as a nation.
In that matter we must be concerned with the social and political goals first and with the economic ends and means next. I submit that we should not start, as I have said, with a preference for one kind of ownership or another, particularly when the economic history of this country has in fact shown that none of the social capital required, some of which I have indicated, will ever be filled adequately or at all by private capital, and that only public investment can possibly do the job.


The Deputy Chairman:: I am sorry to interrupt the hon. member but I must inform him that his time has expired.


David Lewis: I am prepared to sit down now, Mr. Chairman, or to continue if the house will give me two or three minutes to complete my remarks.


Some hon. Members:: Agreed.


Rémi Paul: Is the committee agreed?


Some hon. Members:: Agreed.


David Lewis: I particularly suggested two or three minutes because I wished to say something with the hon. member for Villeneuve here. I wished to say that the funds for this kind of development can be obtained both from monetary expansion through the Bank of Canada-


Mr. Caouetie:: Hear, hear.


David Lewis: -and through borrowing from the chartered banks, if necessary.


David Réal Caouette: Come and sit over here.


David Lewis: Not at all. I would have to lose a good many attributes which I value to sit beside the hon. gentleman in this house.


David Réal Caouette: You have nothing to lose by leaving the socialists.


David Lewis: Let us not get into competition on that score. I was going to say in the presence of the hon. member for Villeneuve that the Social Credit party some time ago had a glimmer of truth in the fact that you could expand your money supply and thereby reduce the interest charges and place money in the hands of the consumers in order to absorb what the increased productive capacity has produced.


David Réal Caouette: That is right. I will give you an answer.
Ways and Means


David Lewis: That glimmer of truth has so blinded them that they have been unable to see anything else ever since.


David Réal Caouette: You are wrong there.


David Lewis: It is only a glimmer of truth, and it is only because they have been blinded that the hon. member for Villeneuve was able even for a moment to contemplate in a country like Canada agreeing with Dr. Hjalmar Schacht, the economist under Hitler, and feel proud to display a letter which he had from that servant of the most cruel dictatorship in the history of the world, rivalled only by Stalin of the Soviet union. To be proud to display a letter from the economist of that most cruel dictatorship is something which could occur only because the hon. member was so blinded by that little glimmer of truth concerning money in the hands of consumers. The fact is, Mr. Chairman, and I submit it as a fact, that in the economy what is important are the goods and services produced by men and women.


David Réal Caouette: That is exactly what we have been saying.


David Lewis: You just listen a little longer and perhaps you will start talking sense.


David Réal Caouette: You are just starting to talk sense.


David Lewis: And money is merely the measure of what is produced in goods and services-


Louis-Philippe-Antoine Bélanger: Right.


David Lewis: -and certainly you must have the measure properly adjusted or you will get false ideas.


Louis-Philippe-Antoine Bélanger: Right.


David Réal Caouette: You are a Social Crediter. Come over on this side.


David Lewis: The hon. member is just showing that he does not even know anything about Social Credit when he suggests that.


David Réal Caouette: We know you are a Social Crediter.


David Lewis: It is important that the measure should be adequate for the purpose and should be properly handled, and it is easy to upset the economy if the measure is not properly handled. But having a lot of money will not produce goods.


Louis-Philippe-Antoine Bélanger: We never said that. You are saying that.


David Lewis: If, therefore, hon. members opposite mean merely enough money in the economy to meet the needs of the economy-

Ways and Means


David Réal Caouette: Right.


Louis-Philippe-Antoine Bélanger: At the right place.


David Lewis: -enough money in the economy in the hands of the consumers, and if they stop talking nonsense about the difference between national income and the gross national product, as the hon. member for Villeneuve incessantly and invariably does, then they do have hold of a glimmer of the truth. If to that they will add the concept of modern planning, the concept of intervention of the government in the modern sense, they will have another glimmer of the truth.


David Réal Caouette: You were so good a moment ago.


David Lewis: Wait a minute. I will be even worse in a moment because the most significant statement by the hon. member for Villeneuve was made the other day on a bill before the house-


David Réal Caouette: He is the best member in the house anyway.


David Lewis: Who is? Let it be noted, Mr. Chairman, that the member who said that the hon. member for Villeneuve is the best member of the house was the hon. member for Villeneuve.
I am saying, Mr. Chairman, that the most significant statement by him was made during the debate on a bill presented by the hon. member for Winnipeg North Centre proposing a minimum wage of $1.25 per hour. The hon. member for Villeneuve stood up in his place and in his rapid and charming way-


David Réal Caouette: Thank you.


David Lewis: -said to the house at that time that he was in favour of a minimum wage.


David Réal Caouette: Of $1.50, not $1.25.


David Lewis: He wanted not only $1.25 but $1.50 an hour.


David Réal Caouette: Right.


David Lewis: And then in the most demagogic way conceivable he went on to tell the house that he was opposed to the intervention of the government to enforce a minimum wage.


David Réal Caouette: Opposed to the controls.


David Lewis: I respectfully submit to the heckler, who has no respect for parliament by his presence as well as his absence, that that is demagogic irresponsibility.
(Translation) :


Mr. Lalulippe:: Mr. Chairman, on behalf of the voters of the riding I represent, may I say that I am pleased to take part in this discussion.
The people of the constituency of Compton-Frontenac are practically all farmers. As a matter of fact, it comprises two small towns, with populations of 8,000 and 5,000 people respectively. They constitute the two largest industrial centres in my riding, and that is why I said that I was representing a mainly rural population.
Mr. Chairman, the Canadian people want their moral and vital needs to be satisfied. Not only do these people want a decent way of life, but they also want the various social groups to be protected. They want each man to be respected as an individual and as a human being. They want the present system to be adjusted to moral values, and the basic natural law to apply to all men, which means that each and all of us should be respected.
In short, this new law means the continuation of life, the preservation of human life.
The setting up of this new world will take some time, and, perhaps, courage as well as perseverance, but it also may be quicker than people would imagine. That is the task of our generation. We have to rebuild on the ruins of the present system.
Mr. Chairman, the former governments, the luminaries of our universities, the professionals of our economic organization are responsible for the present situation. It was up to them to keep the world in peace and order. They did not do so. They did not keep those terms and we have to bear the consequences.
Moreover, the people are losing confidence in the philosophy and principles of our present system, because they are not in harmony with the Christian principles of decency and justice.
There is general discontent among the people. There can be found fear, insecurity and undeserved hardships. Hoards of essential goods are wasted and the pangs of hunger are felt by close to two thirds of the world population. This is an absurd and stupid situation. We face imperative needs which must be satisfied. Life is a perpetual creation where man is searching for and finding his own image. But if he is to live of the spirit, his vital and moral needs must be satisfied.
Material needs of men are easy to list: they are food, clothing, shelter, heat and sanitation.
It is a shame that thousands of people, both in Canada and throughout the world,

should suffer from hunger and cold. For this reason alone, our civilization stands irrevocably condemned. Proudly materialistic, it should at least meet the prime requirements of the people, but up to now, it has failed to do so.
In that respect there are undoubtedly in Canada some privileged citizens, namely those who control money and credit, those who manufacture guns, ships and planes. For them, the present system is a blessing.
But the people who foot the bill by supporting the heavy burden of debts, of taxes, in addition to all other unrepaid debts because of fantastic interest rates, cannot be satisfied. This situation cannot last. The world shall not know peace and rest as long as the natural aspirations of man are not satisfied.
That is why we must assume our responsibilities as a nation and as individuals if we want to get results in politics and in economics.
That is why the electors from Quebec decided to withdraw their confidence from the old political parties that are crippled with paralysis. The people who voted for our party chose to support a rejuvenated policy which will take into account the economic realities with regard to the needs of the population, a truly Canadian policy that Social Credit will bring to them.


Mr. Gregoire:: That's right.


Henry P. Latulippe: The old parties help the unfortunate of the world, but overlook the destitute of Canada. The old parties provide credit facilities to foreign countries, but restrict credit for Canadians, the builders of our country. The old parties know where to find money in wartime, but cannot provide a living for Canadians in peacetime. In wartime, plenty for all; in peacetime, misery in the midst of plenty. That is what the old line parties have given us.
Social Credit wants to master money and credit so that production may serve its purpose and help the people.
Money is intended to buy what is for sale; it must serve its purpose. This means that we should circulate as much money and credit as there are products and services available.


David Réal Caouette: That is correct.


Henry P. Latulippe: Social Credit wants to
master money and credit so that the human person may reach freely its full development.
Social Credit wants a balanced Canadian economy with a decent standard of living for one and all.
Ways and Means
Social Crediters want better family allowances and better pensions for old people as well as disabled people and the blind. We also want better allowances for veterans and needy people. All that without any tax increase. On the contrary, we want income tax exemptions to be raised to $5,000 for married people and to $3,000 for bachelors.
Social Credit wants to use the Bank of Canada for the development of our natural resources. We are in favour of using the Bank of Canada to finance the provinces, municipalities and school boards. The Bank of Canada should also help farmers and facilitate the construction of housing. Interest should be charged only to cover administration costs. There should not be any interest at fantastic rates, as is now the case, excessive interest allowed by the old line parties since confederation.
I listened carefully to the speech of the Leader of the Opposition (Mr. Pearson) when he stated that he would be able to restore the economy by all kinds of means if, naturally, he were in power. In reply, I ask the Leader of the Opposition: how is it that the moment your party is in the opposition you can solve everything, but when it was in power you could not do anything?
After the depression and the war, what did your party do during the 22 years it was in power? You were there at that time, hon. members opposite. You say the Tories have not done anything. Then what is the difference between Liberals in power for 22 years and Conservatives for five years?
The political parties have given this country the corrupt politics of yesterday which the people can no longer stand. We are engaged in a struggle of liberation from the financial dictatorship which has denied us the right to benefit from the wealth of our country and to use it as we see fit.
We realize that we are faced with two enemies: the career politician who speaks of hardship amidst abundance and hands over to his ally, the financier, the profits which come from exploiting the working people. This is terrible, a criminal set-up.
The day is bound to come when we shall have a government which will take over the creation of new money. The public knows too well nowadays what the banks are up to and the money and debt system will become less and less suited to the enormous progress

Ways and Means
which the people will enjoy, and this in the near future.
The potentialities and the economic development of our country have grown tremendously, while the system we have of running into debt has thrown us head first into an awful slump. All in all, the more progress there is, the more we are strangled by those who run us into debt.
No wonder we experience a fictitious prosperity in times of war and an economic slump when the slaughter is over. The Russians, Chinese and Congolese are not to blame for the hundreds of thousands of unemployed we have in this country.
Our governments are to blame because they did not face up to their responsibilities and set up a financial system to serve the people instead of an inhuman system where human beings are treated like animals.
If we accept scientific and technical developments in all fields, why not accept the same development in the area of public finance?
There will be more and more unemployed among Canadian workers if we refuse to recognize the priority of man over money. But if we recognize that priority, they will enjoy more and more leisure.
Automation should please man and assist him instead of driving him to that kind of insecurity which handicaps him in his own country.
Old political parties offer no solution when the only thing missing is money. Why send representatives to every country in the world to try and sell our goods which our own citizens would like to buy if they had the purchasing power at their disposal?
How can we make coherent suggestions to other countries when we can do nothing in our own country in order to give Canadians their share of the Canadian production?
The country was not developed by government nor by finance. Finance and government would not have achieved much alone; they needed the brains and the arms of our honest Canadian citizens for that job. And while all those pioneers and builders were at work, our governments allowed a few individuals to exploit us as the development went on.
We have a tremendous national debt which practically paralyses all our activities and which carries the germ of inflation and deflation accompanied by a host of undeserved

hardships imposed upon our citizens in the name of civilization and freedom, a freedom which our people have never known since confederation.
Our old political parties, once in power, become totally unable to cope with financial problems, so much so that we wonder if it is not a disability pension that we are paying our members instead of a parliamentary allowance as true representatives of the people.
But you know that such hardships do not result from the fact that Canada is unproductive or unable to produce more. You very well know that the lack of bread on a Canadian table is not due to a lack of wheat; it is simply a matter of money.
The producers of goods and services are doing a very good job. They would perform an even better one if they were not faced with money problems.


David Réal Caouette: That is right.


Henry P. Latulippe: If the producers of goods and services refused to produce, you would expose them to the people and you would take the necessary steps to force them to produce.
But when the money producers penalize the Canadian citizens, why, gentlemen of the government, do you not have even a word of reproach for them? You penalize the producers of goods who do a good job and you show respect for the masters of money who do not do theirs.
The production of goods requires effort and skill; the production of money requires only a decision, and it is money that is lacking.
Nevertheless, it is a crime for governments to let human beings remain in such hardship amidst an abundance that is there for everybody to enjoy.
Each woman or child who goes hungry, who suffers from the cold and each family that is ill-housed is a living accusation against you, the old parties, which do nothing to put an end to that tyranny.
It is time to establish a financial system at the service of Canadians instead of supporting a dishonest financial system that overlooks entirely the possibilities of the country.
The economic and political ills of society are blinding, but we have to determine their causes scientifically if we are to apply the appropriate remedy.
What is the aim of economic planning? Does it provide employment for all? Or does it rather aim at producing as much goods as possible, as many products and services, with the least effort possible?

Improved agricultural and industrial methods increase production, and often replace man by machines, especially since the first world war of 1914-18, to the extent that today organized society can produce enough useful goods to meet the vital needs of all mankind while progressively reducing the part played by human labour.
The people realize more and more the enormous production capacity of the industrial system; but the old political parties still believe that the goods men need must come from the work of all the population just as it was before the coming of modern machinery.
On the other hand, the same people learn and notice that millions of people live in the most abject poverty, that the natural right to marriage is thwarted, because the system is unable to distribute the great wealth which it is able to produce.
Yet, even though they acknowledge that the situation is absurd, even though they speak out against it, the old parties ignore the real cause of the people's misfortune. They hopelessly advocate useless and illegitimate reforms.
Indeed, those reforms, communism and socialism, are useless and illegitimate because they ignore man's natural rights. They are useless because they do not constitute a true remedy; they are not the proper solution and they will never remove the economic ailments of our society. Besides, the popes have condemned such doctrines and, for us Christians, that should be enough.
There are two distinct ways of achieving the aim of economic planning, which is to provide the consumers, men, women and children, with essential commodities and services:
(a)	By production, means of transportation included;
(b)	By the distribution of those products among the consumers.
The first of those means, production, is getting to be more and more efficient. Consequently, it is not at that level that we will find the present ailment of our economy.
It is the second process we must examine in that regard. It is distribution which is not up to the mark and which is now paralysed.
As money is the instrument of distribution, the means of exchange, it is the monetary system which does not play its role properly. It does not distribute the goods produced.
Ways and Means
Fundamentally, money plays the role of a ticket, it facilitates the exchange of goods, as our friends opposite were saying a while ago. The value or soundness of money is based on the people's confidence in their country's producing power.
The natural function of money is to ensure the continuous distribution of all the useful commodities which the people produce and need.
Today all governments have neglected their duty in surrendering control over the money system to a small group of men who do not give a hoot about the primary purpose of money and who have turned it to a use which is exactly the opposite to what it should be. Thus, those men have absolute economic and even political control over society.
The controlling power of our financial system today, that is the masters of the banking system have reserved the right to issue money; they create money and put it into circulation in the form of debts that must be refunded to them with interest. With the repayments they demand at fixed dates, they withdraw and cancel that money even before the products have reached the consumer.
Since money is the instrument used to convey commodities from producers to consumers, its withdrawal deprives the people of their power to purchase all the goods they have produced. The banking system, in withdrawing more money than it has issued, makes money scarce at a time when products are plentiful and workers ask nothing more than jobs.
Hence the exports and the unrestrained competition for foreign markets, because there is not enough money on the domestic market. Hence international indebtedness, economic conflicts leading to wars. Hence also a progressively increasing control over agriculture, industry, capital and the natural resources of society, a control which places the universe at the mercy of this world bank monopoly.
The banking system tries continually to withdraw as soon as possible the money issued for production, without bothering to see whether that money did also make distribution possible. Hence a number of disastrous consequences:
(a) A frantic competition in which efforts are made to reduce costs as much as possible by cutting salaries or by putting pressure on the workers; then efforts are made to sell at the highest price possible, in order to recover the total costs, including the interest on money "created out of nothing".

Ways and Means
Hence we see a continuous succession of bankruptcies. The weakest and the meekest are eliminated by competition because the consumers lack sufficient purchasing power.
We see an increasing accumulation of products which do not sell, despite the need of consumers who cannot afford them.
We are witnessing a progressive failure of that attempt, because machinery displaces workers and because the equipment so increased is soon idle, since the consumers lack the money to buy the production of that equipment.
Governments tried to correct such conditions through various palliatives, such as public works or financial assistance to the most stricken. Peter is robbed to pay Paul and poverty increases instead of being eradicated.
Governments have only two ways of raising the money they need for such remedies:
1.	Through taxes collected on the already inadequate income of the consumers;
2.	Through bank loans. New money created by the banks but later recalled, increased, because of the interest it bears.
The failure of such remedies is therefore most obvious, because they will leave the consumer burdened with a larger debt and more and more lacking in purchasing power.
To solve the problem, it is clear that the governments must reassume their prerogatives and themselves exercise a control over the money supply needed by the people.
The government must base the money supply on the productive capacity of the country, issue new money not as a debt to the banks and saddled with interest charges, but issue debt-free money.
To automatically prevent any risk of inflation and deflation, and to maintain a perfect and continued balance between prices and purchasing power, prices will have to be according to production and consumption statistics. Such discount shall be calculated to bridge the gap between prices and total purchasing power.
Is anyone opposed to Social Credit? Yes, and I will mention a few classes of opponents. The bank magnates and those of the trusts operating within orbital control of the banks are opposed, because they can sense the loss of their precious monopoly, of their means to exploit the public. Their political flunkies who are more sensible to the realities of the election funds than to the needs of the public back up the bankers' opposition.

Political parties have not yet incorporated Social Credit in their program, because they are listening to the voice of their financial backers and because the people, inadequately informed, have not yet raised their voice.
The 30 members in this corner of the house, who were elected by over 500,000 voters, are starting to inform the people of the province of Quebec and Canada.
Those in charge of the patronage are generally opposed to Social Credit, because if the public has some money, they will lose their importance.
Some people among the newly rich are opposed to Social Credit because they like to throw into the shade those who own very little. They fear that if the public does not need to crawl for its right to live, it will judge men on their moral worth, and not on their wallets.
I notice that our opponents state or deny but that they do not prove anything. Or if they do, they distort Social Credit in order to make it open to criticism, but one of them has gone as far in this house as to give a false interpretation to certain texts in order to introduce an unwarranted meaning in them; the name for that is not ignorance but deceit.
It was St. Louis, King of France who said:
The first duty of a king is to strike coin when there is not enough for the economical good of his subjects.
It is not at all necessary or even recommendable to do away with the banks or even to nationalize them. A banker is an expert in accounting and investment. He is therefore entitled to continue to receive and invest savings and to keep a part of the profit.
But printing money is an act of supreme authority which should not be associated with a bank. We must take the supreme authority away from the bank and give it back to the nation.
Ledger money is a good modern invention which must remain, but instead of originating from a private source, as a liability, the figures representing money must originate from a national agency, as a servant of the nation.
We must not tolerate-


Rémi Paul: Order. I regret to inform the hon. member that his time is up.
(Text):


Mr. Maclnnis:: Mr. Chairman, during the course of the last several weeks we in this comer of the house have attempted to put before hon. members of the house, for their

judicious consideration, certain recommendations and proposals that we sincerely believe are in the way of concrete assistance in relation to the two tremendous problems facing us in Canada today, namely an inadequate rate of economic growth and the major question of unemployment. On each occasion, from each opposition corner of this house, as if sitting on their white steeds and waving their banners in the air, we have heard the traditional cry of "socialism. These are the people who are going to destroy our freedoms." Mr. Chairman, this tactic and this approach is not at all dissimiliar from what we find in the John Birch society and similar ultraconservative and right wing organizations. Surely we can expect, from responsible representatives of the people, that they will attack us and criticize us positively and constructively, and not with false labels.


David Réal Caouette: You don't even know what you are talking about.


Donald MacInnis: Mr. Chairman, the hon. member for Villeneuve rose in the house the other evening with, I believe, this very dictionary, the Concise Oxford dictionary, and read the definition of the word "socialism". I would like to point out to the committee, first of all, that we do not find any mention of social credit in this dictionary, and therefore we can assume that socialism is at least more significant, as far as these people are concerned, than social credit.


David Réal Caouette: Just read about Christianity and you will find out about social credit.


Donald MacInnis: Second, Mr. Chairman, I want to suggest to the hon. members opposite and other people who are attacking us on the basis of supposedly being socialists, that this is not, once again, a question of socialism versus free enterprise. Let us ask the question, first of all: is the program that is being promoted by the New Democratic party a program of socialism? We had it in the words of the hon. member for Villeneuve, and from the Concise Oxford dictionary here the other evening, that in a socialist state, the state or the government takes over and controls all the means of production and the resources in a society. We do not propose to put this particular program before the people. We do not propose to adopt these policies.
Then, Mr. Chairman, it is suggested in this particular definition that in a socialist society the rights and freedoms of the people of the nation are destroyed and taken away. Once again, this is not the objective of the New Democratic party. Rather to the contrary, we are interested in controlling the monopolistic tendency of the capitalist society and enlarging and expanding the scope of the free-
Ways and Means
dom of people; enlarging the freedom and opportunity of people to obtain for themselves adequate and decent housing and all the education which their children can take advantage of, regardless of their ability to pay.
If I might paraphrase Mr. Churchill, who I am sure is a much more acceptable reference in this house than either Hitler or Mussolini, Mr. Churchill once said, "Is a man any less free when he is adequately housed and adequately clothed?" This is the principle on which the New Democratic party is operating. We say, do not criticize us for what they say we are. Criticize us for what we say we are and for what we propose. We will accept your criticism on that basis.
Just what is the program of the New Democratic party? What, in brief, are we proposing when we talk about the problems of economic growth and unemployment in Canada? We say that a federal government, in relation to the capitalistic, industrial and automated society that we have today, must provide leadership. We say that a federal government must intervene in the economy in the interests, in so far as is necessary, of the common welfare of the citizens. We say that we would adopt intelligent but democratic economic policies.


David Réal Caouette: How?


Donald MacInnis: This is not classical socialism, Mr. Chairman; but if this is socialism, then I am a socialist and proud of it. We can cite as evidence of the value and the success to date of the types of measures which we have been recommending and which we will continue to recommend, the experience of the west European nations and, in particular, the nation of Sweden.


An hon. Member:: You don't know anything about Sweden.


Donald MacInnis: Some time, when I have an hour or two, I will tell hon. members something about Sweden. But we must go back a few days to the remarks of the Minister of Labour in this house when, in an attempt to decry the value and success of democratic economic planning in western Europe, he said: Yes, it is true; it works; it has been successful; but, surely, you socialists are not going to recommend that we should adopt measures used by nations which pay lower scales of wages than the rates paid to Canadian workers?
This is another example of inaccurate and misleading Conservative statements. They continue to beg the question. They decline to stand up and document their answers. What do wage rates mean by themselves? They mean nothing. A wage rate has to be related to the cost of living in a country. The actual wage rate is not important. What is important is a low cost of unit production, and this is

Ways and Means
where we can compare the standards of west European democracies with those of Canada. Further, I would point out to the government and to the Minister of Labour that 74 per cent of the exports of the United States come from ten companies with the highest wage structure in that nation. Finally, 85 per cent of the imports which we took into Canada this year came from a country with a higher wage structure than our own. Surely this negates the argument used by the Minister of Labour.
What of free enterprise, which conservative-minded members opposite hold up for our admiration, even going so far as to invoke some of the papal encyclicals in their support? I have just as much right to discuss those encyclicals as they have, and I suggest to them that if they read "Rerum Novarum" and "Quadragesimo Anno" carefully they will find in them the most ringing condemnation of the capitalist system to be found anywhere. Further, if they read the latest encyclical, "Mater et Magistra", they will find outlined there exactly the type of program which we are proposing in the New Democratic party.
Unfortunately, some of the reactionary conservatives in the Liberal party are still trying to discuss economic problems within the framework of classical economics from the days of Adam Smith. They are a hundred years behind the times. Adam Smith defined economics as that science which deals with the allocation of scarce resources. That is not the problem of North American societies today. Our problem is not one of production. Our problem is one of distribution.
We do have important basic social and economic problems here in Canada. Certainly, we still have an unjust distribution of wealth. We can all agree on the desirability of increasing our production so that everybody can share in the increase. Even traditional thinkers on both sides of the house agree as to that. What is more basic and more important is the redistribution of the wealth we already have in this country.
We have an obligation to the developing nations of the world. Two thirds of the people of the world are not as well off as 85 per cent of the Canadian people. I suggest that this traditional Conservative blocking of change has to stop. We have to wake up. We can no longer afford to be complacent. In support of the argument I am trying to present-I have found it difficult because of the interruptions-let me point out that it is not only the New Democratic party which is suggesting we should introduce some fundamental change into our thinking and in our approach to the problems of industrial societies today. Let me quote briefly from a

publication issued by the centre for the study of democratic institutions. I am sure this is a publication of an organization which we can all respect. I quote:
Economic theories adequate to an industrial revolution are not good enough for the conditions of the scientific revolution. The complexity and interdependence of the scientific industrial state calls for national planning. Government must intervene more and more in the nation's industrial life.
May I call it five o'clock?


Rémi Paul: It being five o'clock, it is my duty to leave the chair in order that the house may proceed to the consideration of private members' business pursuant to section 3 of standing order 15.


PRIVATE BILLS
Mr. E. L. Morris (Halifax) moved: the second reading of Bill No. S-5 respecting the Eastern Trust Company.
He said: Hon. members will wish to know the purpose of Bill S-5, which comes to us from the other place without a murmur of senatorial discontent. We are asked in the bill simply to add a French language version, "Le Trust de l'Est Canadien", to the name of "The Eastern Trust Company."
The company could then use, in the transaction of its business, either the name The Eastern Trust Company or the name Le Trust de l'Est Canadien, in either of which names it could sue or be sued, and any transaction, contract or obligation heretofore or hereafter entered into or incurred by the company in either of the said names would be valid and binding on the company.
Now, sir, I venture to suggest to the house that it is a good and desirable thing for national companies to have both an English and a French name. My hon. friend, the member for Vaudreuil-Soulanges, (Mr. Bour-bonnais) will be speaking of the exemplary value of the Eastern Trust Company's action when he seconds the motion for second reading. But, I, as the bill's sponsor here, should say a few words about the company.
The Eastern Trust Company has the head of its 13 branch offices in Halifax. It has offices in Vancouver, Kamloops, Calgary, Winnipeg, Toronto, Montreal, Saint John, Moncton, Charlottetown, Lunenburg, Halifax, New Glasgow and St. John's, in every province, it will be seen, except Saskatchewan. Why that is so I cannot say. I had the pleasure of visiting Saskatchewan during the past week end and I should think there is good harvesting there for Nova Scotia acumen and ingenuity in finance.
It is not surprising that the company should have its head office in Halifax and that it

has been managed with such probity and enterprise as to allow it to pay dividends in each of the last 68 years. Sir Winston Churchill, in the first volume of "Marlborough, His Life and Times", writes about some men what could equally be said about some regions:
The stern compression of circumstances, the twinges of adversity, the spur of slights and taunts in early years, are needed to evoke that ruthless fixity of purpose and tenacious mother wit without which great actions are seldom accomplished.
Nova Scotia has, alas, until very recent years, not been wholly hospitable economic ground. Perhaps the burdens of putting down adversities have inspired that tenacious mother wit which account for its being the birthplace of so many of our great banks and great bankers, our financial institutions and, yes, our ministers of finance.
The Eastern Trust Company, founded in 1893, now has some $300 million in assets under its administration, a doubling in the last seven years. Its gross profit last year was nearly $645,000. It paid dividends in excess of $180,000 and $224,000 in taxes. Hon. members will see that it is a substantial as well as experienced company.
In view of its extensive operations and range of services, it seems only proper to the company to seek from parliament the statutory entitlement sought by the bill before us to use a French version of its name as well as the English version in which it has operated so serviceably and so successfully for so many years.
(Translation):


Mr. Marcel Bourbonnais (Vaudreuil-Sou-langes):: Mr. Speaker, having supported the proposal made by the hon. member for Halifax (Mr. Morris), I am pleased to congratulate the management of the Eastern Trust Company for having taken the initiative of asking this government the permission to amend its charter in order that it may also be known under the French name "Trust de l'Est Cana-dien".
I am convinced that such a step is the result of the efforts made, over many years, by the Conservative government in the field of bilingualism. In fact, in the last five years, this government has given the lead in the field of bilingualism all over the country, and has endeavoured to have French and English recognized as both official languages of this country. That example has been followed by the management of the Eastern Trust Company, and I hope their action will serve as an example to several other Canadian companies bearing an English name only and which are doing business in eastern Canada.
In fact, it is recognized that in order to succeed in the eastern part of the country, 27507-3-70
Private Bills
where the population is mostly French speaking, it is important that Canadian companies bear a French name as well as an English one.
I therefore hope, Mr. Speaker, that the initiative taken by the management of the Eastern Trust Company will be followed by the management of many other Canadian companies which are doing business in this country.


Mr. J. C. Caniin (Quebec South):: Mr. Speaker, I agree with the proposed measure but I am wondering if the directors of that company could not have chosen a name which would really be French. In fact, the translation of "trust" is "fiducie" and I am wondering whether the name could not have been "La Societe de Fiducie de l'Est Canadien".
I make that suggestion to my hon. friend for the sole purpose of giving that company a really French name and its true character.


Mr. Andre Bernier (Richmond-Wolfe):: Mr. Speaker, I am pleased to add the views of our party to those already expressed on this bill.
To give a French name to that company is certainly a commendable initiative, but as the member for Quebec South (Mr. Cantin) so rightly pointed out, it would be better, of course, if the selected name were more truly French. I hope that the suggestion of the hon. member for Quebec South will be seriously considered.
This is no doubt a remarkable step toward bilingualism in Canada and that is the reason why we are supporting this bill.
(Text):


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on banking and commerce.

[Stage Direction]
On the order:
Second reading of Bill SD-1, an act for the relief of Madeleine Francoise Hankowski.-Mr. Mandziuk.
Mr. Nicholas Mandziuk (Marquette):: Mr. Speaker, may I ask the agreement of the house that orders Nos. 2 to 306 inclusive be allowed to stand?


Mr. Churchill:: Agreed.


Some hon. Members:: Agreed.


Mr. Speaker:: It is proposed by the hon. member for Marquette that orders Nos. 2 to 306 inclusive stand with the consent of the leader of the house.


Mr. Leon Creslohl (Cartier):: I wonder whether it would be in order to ask the chairman of the committee to tell the house

Industrial Relations
the reason why the request is made that these bills be allowed to stand. I think the house and the country are certainly curious to know why these bills are kept on the order paper from one week to another.


J. Nicholas (Nick) Mandziuk: Mr. Speaker, I appreciate the interest of my hon. friend. However, at the moment, if he will bear with me, I would rather make no statement although I expect to make one shortly.


Leon David Crestohl: I am pleased to bear with the hon. member.


Mr. Speaker:: Is it agreed that the orders stand?


Some hon. Members:: Agreed.
Orders stand.


SOLICITOR GENERAL ACT
[Stage Direction]
On the order:
Second reading of Bill C-13, an act respecting
the Solicitor General Act.-Mr. Howard.
Stanley Howard Knowles: Stand.


Gordon Minto Churchill: Stand.


Mr. Speaker:: Order No. 1 will stand at the request of the government.
Order stands.


INDIAN AFFAIRS
[Stage Direction]
On the order:
Second reading of Bill C-14, an act respecting Indians.-Mr. Howard.
Stanley Howard Knowles: Stand.


Gordon Minto Churchill: I agree to allow this bill to stand, at the same time reserving the right to raise a point of order on it when it is brought forward by the mover.


Mr. Speaker:: At the request of the government the order will stand.
Order stands.


INDUSTRIAL RELATIONS
Stanley Howard Knowles: the second reading of Bill No. C-15, to provide for pay for statutory holidays for employees and for pay for work performed on statutory holidays in federal works, undertakings and businesses.
He said: Mr. Speaker, as the title of this bill makes clear its purpose is to provide for statutory holidays with pay for workers in

Canada who come under federal labour jurisdiction. Let me make it clear, in view of things that have been said in other debates, that we recognize that that is as far as federal legislation can go. This bill goes no further than that. It relates only to employees who come under federal labour jurisdiction, but it provides that for such employees there shall be eight holidays during the year on which they shall have the day off and shall have it with their full pay. The days suggested in the bill are New Year's day, Good Friday, the 24th of May or whatever day near that is celebrated either as Victoria day or as the Queen's birthday, July 1, Labour day, Thanksgiving day, Remembrance day and Christmas day.
The principle of the bill is, I am sure, one that commends itself to members in all quarters of the house. All the parties represented here have pronounced themselves at various times in favour of workers having statutory holidays with pay. I hope, therefore, that the debate need not be lengthy and that the bill can be given second reading whereupon I would be happy to move that it be referred to the standing committee on industrial relations. By offering to have it referred to that committee I give the undertaking so far as I am concerned that details of the bill can, of course, be altered in the committee if the committee so wishes. In other words, what we are dealing with at this point is solely the principle of the bill which, as I say, is that there should be eight statutory holidays with pay and provision that when employees are required to work on any one of these statutory holidays they shall receive extra pay for such work.
There is not a great deal of legislation on the statute books of Canada providing for statutory holidays with pay. There is some to which I shall refer. This is in fact one of the reasons that I present this bill, in the hope that once again the federal parliament might give the lead, a lead that I would hope might be followed by provincial jurisdictions. There are actually only two provinces thus far, Manitoba and Saskatchewan, which have provisions of general application dealing with public or legal or statutory holidays. Most of the other provinces have some provisions, but they are restricted in that they either provide holidays for only certain elements of the working population or in that they provide for holidays but do not provide any pay for them. In the two provinces that I named, Manitoba and Saskatchewan, there are provisions for statutory holidays with pay for all workers, seven in the case of Manitoba and eight in the case of Saskatchewan.
I am happy to say, Mr. Speaker, that in terms of being specific the best piece of legislation that we have regarding statutory

holidays is the Civil Service Act, chapter 57 of the statutes of the federal parliament of 1960-61. Section 62 of the Civil Service Act provides as follows:
The following days are holidays for the civil service:
Then there are listed nine specific days which are holidays for the civil service and there are provisions which make it clear that these holidays are to be had with pay. Then there are provisions for regulations dealing with the question of either extra pay or compensatory time if persons are required to work on these particular holidays.
It will be noted that the Civil Service Act which I have in my hand spells out nine holidays whereas in my bill I am only asking for eight. I should like to see more, but getting started is better than having nothing at all. The ninth day that is provided in the Civil Service Act is Easter Monday. As hon. members know, this is a holiday that is not yet too general outside of the federal civil service and the banks. Therefore at this point I am actually asking for employees in Canada generally, those who come under federal labour jurisdiction, something which is a little less than the federal government has already provided for its own employees.
As I say, Mr. Speaker, this is something that all parties in the house are agreed upon. It is something that many people think is on the statute books but it is not there yet. Therefore we in this party feel that the time has come to put this kind of legislation on the statute books. I hope that the debate may be brief so that the bill can be given second reading. If that happens it is very clear that all the house will have done will be to approve the principle of the bill. If there are details in it that members feel should be altered I would be quite happy to have them altered in the committee on industrial relations, but I suggest that here again is an opportunity for the platforms of all four parties to be implemented by placing this piece of social and labour legislation on the statute books. I therefore move that second reading be given to Bill No. C-15 to provide for statutory holidays with pay.


Mr. Speaker:: Order. I should like to get some clarification from the hon. member. I have examined the bill and I see that there is nothing in it to exempt employees of the crown from its provisions, whether such employees come under the Civil Service Act or whether they may be under prevailing rate engagement or any other engagement by the crown. I should like to know whether it is felt by the hon. member that such employees might be covered under other legislation to the same end that he now seeks in this bill and if not whether he feels that there may 27507-3-704
Industrial Relations
be some difficulty as to the right of an hon. member to propose a bill of this nature which would cover servants of the crown and therefore envisages the spending of public moneys. This raises the question of whether it is within the competence of an hon. member of this house to put forward such a proposal under the form of a bill without the usual procedures in that respect. Perhaps the hon. member might enlighten me in that regard.


Stanley Howard Knowles: Mr. Speaker, I did not expect to have to deal with a procedural point in connection with this bill but an invitation to do so is not one that I quickly turn aside.


Gordon Minto Churchill: Turn it aside this time.


Stanley Howard Knowles: I shall be brief because I should like to see the bill debated and voted on. I am speaking from memory now but my memory is pretty clear on the point and I would draw Your Honour's attention to the bill which the present Minister of Labour brought in in the fall of 1957 providing for annual vacations with pay. I had a bill similar to it in the same session. The point I would make is that the minister's bill, which was brought in and passed, was brought in without a prior resolution. Actually, I think it went further than my bill, but it was felt not to be a money bill because it simply established a principle, the carrying out of which might require money in the estimates or some future grant. So far as the bill itself was concerned, it was not regarded as a money bill and no prior money resolution was necessary.
Incidentally, the bill that I had in that same session was not questioned as to its propriety for the very same reason. I have had one or two other bills since that that fell in the same category. I say that even if the bill became law and could be interpreted as applying to civil servants or servants of the crown. I suggest it is on all fours with the minister's bill for annual vacations with pay. Since it is not a money bill in itself, it does not require a prior resolution. If it does not require a prior resolution, it is proper for a private member to introduce it.
Without transgressing on my own promise to keep these remarks brief, may I say that unless a bill such as mine particularly says that it applies to servants of the crown I do not see that that interpretation necessarily follows. Your Honour draws attention to the fact my bill does not specifically exempt from its operation servants of the crown. I suggest that the other side of the coin must be looked at. The fact is that it does not specifically say that is the case. I left that part of the argument to the last because it seems to me that, even if there is any doubt on that
10S8

Industrial Relations
point, the bill stands on the basis of the first point I made, namely, that it is similar to the bill brought in by the Minister of Labour for annual vacations with pay. It was not a money bill and if that one was not, in itself, a money bill, I think this one is not a money bill either. This is a bill the effect of which would be to establish a principle.


Mr. Speaker:: I thank the hon. member for giving me this information. This is a doubt that I had, and I am not sure that it is fully resolved. However, I do not intend to make a ruling at the present time on this question. Perhaps the hon. member would address himself to the matter, and I will do likewise. At the moment, I would just raise this point to seek some clarification from the hon. member.


Mr. O. J. Godin (Nickel Belt):: Mr. Speaker, when I first formed the intention of making some comments concerning Bill No. C-15, I did not expect a discussion would arise concerning the validity of the bill being before the house without having been preceded by a resolution such as is ordinarily required for a money bill. Since Your Honour has suggested that your mind is not at ease at this time concerning this problem, may I add a comment which may assist you? I feel that this bill in no way calls for an increased expenditure by the government or a crown corporation. What it does is to establish a principle whereby people receiving a salary from occupations over which the government has authority will not work on certain days but will receive their pay. In other words, if the employee's salary is $4,000 a year, that will be the only expense to the crown corporation or the government department. It is suggested that these people would not work on these special days but would receive their pay. In no way would this, of itself, increase the expenditures of the crown corporations or the government.
It is in that light that I should like to make a few comments on the principle of this bill. I was pleased when the hon. member who moved this bill suggested that it be referred to the appropriate committee for study. As I read the bill, Mr. Speaker, there are certain queries that come to mind. If the bill is referred to a committee, it may be made clear that it will be of help to those employees about whom we are concerned in connection with this question of holidays with pay. We know that civil servants are presently applying to have certain principles approved in connection with their occupation of serving the government. I believe no member in this house would wish to see a bill passed which was not fully in accord with the wishes of the civil servants. It may be that they would

like to have principles established which would vary from those contained in this bill and we would not wish, by passing this measure, to restrict them in their efforts to obtain the working conditions they desire.
I am sure I can speak for most of the members of my party, the Liberal party, when I say that we do recognize that as we progress in this country we should pay attention to that standard of living which we would like to see obtain in this country. One method, undoubtedly, of obtaining that standard is through the granting of proper working conditions by giving employees proper holidays during the year. I am sure that most members of this house would be pleased to see the bill referred to the appropriate committee in order to ascertain whether or not it is a bill that should be passed. Then, when the bill is returned to this house perhaps it will be in a form which, in all respects, will be appreciated by the employees over which this government has jurisdiction.
(Translation):


Mr. Robert Beaule (Quebec East):: Mr. Speaker, in spite of what the hon. member for York South (Mr. Lewis) has said, if we have been blinded by certain statements, we are not blinded by this bill.
Since I have already taken a specific stand with regard to federal employees during the debate on the address, I am speaking for my party in endorsing this bill.
I believe that when, in 1962, collective agreements are being signed in the industry to give statutory holidays to certain employees, when statutory holidays with pay are also enjoyed by the employees of certain factories, it is only fair to say that charity begins at home. The government should see to it that this bill is considered by the house so that all federal employees be granted all the statutory holidays that the hon. member for Winnipeg North Centre (Mr. Knowles) specifies in his measure.
I suggest that, for once, we agree with our hon. friends opposite. The bill has all the required provisions to give federal employees the minimum treatment to which they are entitled.
I therefore ask, in the name of our party, that the house considers this bill. We believe that federal employees should have paid statutory holidays.


An hon. Member:: Including the members. (Text):


Mr. A. D. Hales (Parliamentary Secretary to the Minister of Labour):: Mr. Speaker, Bill C-15 is one that has been before us on many

occasions. I recall that during my first session in this honoured chamber the hon. member for Winnipeg North Centre (Mr. Knowles) introduced a similar bill and we had at that time a very good discussion on it. Following that he became vice president of the Canadian Labour Congress and the former hon. member for Burnaby-Coquitlam re-introduced the bill in 1959 and again in 1961.
I was interested in the remarks of the hon. member for Nickel Belt following your remarks, sir, as to whether or not the bill was in order. The hon. member said he felt it did not require extra funds but I disagree with him in this regard in that the bill covers hourly rated employees and would necessarily involve extra funds.
The stated purpose of the bill is to regulate the terms under which employees in industries coming under federal jurisdiction may be employed on designated statutory holidays each year. It also provides that on any of the eight designated statutory holidays on which an employee does not work he is to be paid at his regular wage rate, and further, if he works then he is to be paid his regular daily wage plus two times that wage, making his pay three times his regular daily wage rate. As an example, if a man were paid $15 a day he would receive $45 a day if he worked on a statutory holiday.
Therefore the principle of the bill is apparently to guarantee that federal employees should be free from work without loss of income on the regular general holidays mentioned by the mover of the bill. This is demonstrated in the provision setting out that the regular wage rate would be paid on the designated statutory holidays not worked. However, there is a further principle embodied in the bill, that work itself should be discouraged on general holidays. This is clearly implied in the stipulation that the employer should be required to pay triple the regular daily wage rate to those employees whose services are required on the general holidays covered by the bill.
The application of these principles is not a simple matter in the industries that come under the jurisdiction of this parliament. Complications arise immediately with respect to the kinds of operations in which the bulk of federal jurisdiction industries are engaged, for by and large their operations are continuous. The services they render, by necessity, are required week in and week out, on general holidays and other days. In fact, some of the industries with which the government is concerned are required by law to operate continuously. In some instances, moreover, as in railways, buses, air transport, telephone, telegraph, radio and television operations
Industrial Relations
the greatest public demand for the services of these industries seems to fall on the general holidays specified in the bill. Therefore while the alleged purpose of the bill is to require industries to observe days of rest for their employees on statutory holidays, its chief effect would be to require the payment of a high premium rate, in fact triple the regular rate of wages, for work that as a matter of public accommodation and in the public interest must be performed on these general holidays.
Although the bill has application to federal employees, if it were passed I am sure industry would be expected to follow suit.
The hon. member for Winnipeg North Centre has drawn heavily on Saskatchewan legislation for his legislative inspiration. In reviewing provincial legislation on this matter it is not surprising, therefore, to find that Bill C-15 most closely resembles the legislative provisions for statutory holidays with pay in effect in that province. These provisions include the same designated holidays and the same required rate of holiday pay, namely, regular wages when an employee does not work on a holiday; but for work required on a holiday Bill C-15 goes even further than the Saskatchewan legislation. In such circumstances Bill C-15 requires payment of triple wages while the Saskatchewan legislation required double time and one half wages, or in hospitals, hotels, etc. where service is necessarily continuous, either double wages or regular time plus a day off with pay within four weeks. Bill C-15 makes no such distinction in treatment with regard to industries required to maintain continuous service to the public.
The only other province which deals in a general way with the question of pay on statutory holidays is Manitoba, and the Manitoba legislation deals only with pay for work performed on such days, and there are only seven such days stipulated in Manitoba. The total wage required to be paid for such work is one and one half times the regular wage rate. In certain necessarily continuous industries compensatory time off may be given instead.
I would point out also, Mr. Speaker, that neither of those provinces suggests as high a rate of pay as is suggested in Bill C-15, namely, triple pay. I may add that no other province has comparable legislation for paid statutory holidays, and it is also of interest that in the United States there is no legislation on statutory holidays at either the federal or state level that is comparable to the bill under discussion.
It is noteworthy too that neither the number of paid holidays, eight, nor the
1X00

Industrial Relations
minimum amount of the premium required by this bill are prevailing practices in either the federal jurisdiction industries or industry in general.
The most recent survey of the federal jurisdiction industries concerning the number of statutory holidays and the rates of pay for them, was conducted by the economics and research branch of the Department of Labour in April 1958. This survey showed that 40 per cent of the workers employed in industries under the jurisdiction of this parliament received seven days or less paid statutory holidays annually; 22 per cent received eight days; 26 per cent more than eight paid holidays, and 11 per cent received no paid statutory holidays.
Although it was possible in this survey to obtain data on the rates of pay for work on statutory holidays only for non-office employees, it was found for this group of workers that the dominant practice was to pay double time or less for work on designated statutory holidays. Seventy one per cent of the non-office employees surveyed were in this category. Less than 1 per cent of the non-office employees covered by the survey received triple time for work on statutory holidays, the rate of remuneration proposed in this bill.
Mr. Speaker, I think we should perhaps review some of the collective agreements which now exist in some industries. I would first mention the railway industry. An examination of collective agreements in the railway industry that are covered by this bill reveals that employees in the non-operating railway groups have seven paid statutory holidays, but that such employees must have 65 days cumulative service within a 12-month period to qualify. Where the employee works on the statutory holidays, he is paid double time wages.
On the other hand, agreements covering train and engine service employees do not recognize statutory holidays at all, presumably because work performed on holidays by the road operating employees cannot be eliminated or minimized and the requirement of continuous operation is recognized as one of the elements of service. In other words, that is part of the job; it is part of the particular service provided by that industry, in fact, in railway passenger service the public may require on holidays more than the normal amount of weekday train services. This comment would probably also apply to air passenger and other transportation activities.
A provision for statutory holiday pay in shipping operations also presents special

problems which do not lend themselves easily to legislative regulation such as is proposed in this bill.
The Shipping Federation of Canada, which is an association representing deep sea steamship and stevedoring companies loading and discharging ocean vessels at Canadian Atlantic ports, St. Lawrence river ports, and certain ports in the great lakes, negotiates, on behalf of its members, collective labour agreements covering the hourly paid shore labour workers employed at such ports. The Shipping Federation of Canada has this to say:
Due to the peculiar nature of shore labour employment, longshoremen and other shore workers may be employed on any given day of the year, including Sundays and statutory holidays. You are no doubt aware that stevedoring work is casual employment and fluctuates widely during the season of navigation at Montreal and other ports in the St. Lawrence river system, and also over the 12 months period at Canadian Atlantic ports.
The collective labour agreements provide that double time is payable for any work performed on certain holidays. The holidays in question are, of necessity, different at Montreal and other ports which are not open throughout the winter months, and ports like Halifax and Saint John which operate all the year round. The double time holidays stipulated in the collective agreements are a matter of collective bargaining between the shore labour unions concerned and the employing steamship and stevedoring companies at each port.
Therefore, Mr. Speaker, in the light of these circumstances which are peculiar to the stevedoring industry, if Bill No. C-15 were passed I am sure it would create hardship in that particular type of operation. According to another study made by the economics and research branch concerning holiday conditions provided in a sample of 835 current collective agreements covering close to 600,000 workers in Canadian manufacturing and non-manufacturing industries in 1957, only 6 per cent of the employees covered by the survey were paid triple wages where work was performed on paid statutory holidays. This, however, is the minimum rate required to be paid under Bill No. C-15. Thirty eight per cent were paid double time and one half wages, and 29 per cent double time wages for work on statutory holidays. None of the people covered by the survey received rates of pay as high as this bill proposes.
The survey also revealed, Mr. Speaker, that eight paid statutory holidays was the most common number provided for in collective agreements in manufacturing and non-manufacturing industries. About two fifths of the agreements included in the study, covering a like portion of workers, provide such a clause, whereas one fifth of the workers covered by

the study receive more than eight holidays. Almost two fifths received less than eight paid holidays.
If the proposals contained in this bill are designed to establish minimum standards of pay for work done on statutory holidays, it is clearly evident that the standard proposed goes beyond the minimum wage rates and the prevailing practice for holiday work established by collective bargaining in Canada. In fact, the wage rate proposed in the bill as the minimum rate to be paid appears to be the equivalent of the highest rates in effect in collective agreements, and these rates apply to only a small percentage of employees in industry in Canada. The effect of the legislation, if enacted, would be to establish, as a floor or minimum rate for work done on statutory holidays, a rate of pay which is substantially the ceiling rate thus far established in a very limited number of industries in the course of collective bargaining in Canada.
A major objection to this bill appears to be the failure to recognize or draw any grounds of distinction in treatment in the matter of pay for work on statutory holidays as between activities classed as continuous service operations and other types of operation. In choosing to enter this type of employment, workers should have a full recognition of the nature of the industry in which they are taking service.
There is another fact, Mr. Speaker, that I think we must keep in mind. I mentioned this on a previous occasion when this bill was before the house. I said at that time that another fact which enters into the picture is this. If one is to be paid three days' pay for one day's work, the mercenary angle may become more important than the holiday angle; the value of statutory holidays may become secondary, and the mercenary angle foremost. Therefore I think there are many aspects of this bill which we must look at before passing it. I would be the first to agree that it should go before the committee on industrial relations. However, in view of all these aspects to which we must give serious consideration and which I have tried to outline, it is obvious that the bill is open to serious question on several grounds. Therefore I would suggest that it should be rejected by the house for the time being.


Mr. H. E. Gray (Essex West):: Mr. Speaker, I join with my colleague from Nickel Belt in supporting the principle of this bill. Because I do so; because I agree that it would be worth while to refer it to the appropriate committee for study, I will be most brief. The detailed statistics and interesting points
Industrial Relations
raised by the hon. member who has just spoken have helped to establish the necessity of a further careful study of this bill in the committee on industrial relations. We Liberals have long thought there should be a national labour code covering these questions, and as part of this code we have said there should be provision for such matters as extra pay for work done on statutory holidays. I will conclude my brief remarks on this occasion by saying we should approve this bill in principle and should give it second reading and refer it to the committee on industrial relations for further study and any amendment it may require.


J. Nicholas (Nick) Mandziuk: At the
outset I should like to refer to a phrase which was used by the hon. member who has just sat down-that it is the Liberal party which has always introduced and supported progressive legislation. Let me say I was pleased to hear the hon. member for Winnipeg North Centre include Manitoba as one of the provinces which had progressive legislation on its books providing for extra pay for statutory holidays for employees employed by the province. The Conservatives put that on the books in Manitoba.
I believe this bill would be most popular among most people, indeed among practically all the people concerned. It is human nature to like to grasp at something for nothing. We realize that the employees of the federal government have not the means of protecting themselves which are available to organized labour outside. They have not the same means of collective bargaining as has labour in private industry. Naturally, if employees in private industry have secured by negotiation, through their unions, holidays with pay, employees of the federal government should be entitled to the same thing and the same principle should be applied. I agree with the principle of this bill, but only to a certain limit.


An hon. Member:: Question.


J. Nicholas (Nick) Mandziuk: I agree that employees of the federal government in the services and trades mentioned in the bill should be paid for working a certain number of statutory holidays, but I think it would be a miscarriage of justice if we were to incorporate in a bill that on holidays they should receive triple pay. I think that is almost ridiculous. I commend my hon. friend from Wellington South (Mr. Hales) for giving us a resume of what private industry has done for labour. There are very few instances where triple pay is

Industrial Relations
given. That is unreasonable. If the hon. member were prepared to amend that and reduce it to the rates paid under the accepted practice in private industry-


An hon. Member:: In committee.


J. Nicholas (Nick) Mandziuk: I agree that if an employee has to work during a statutory holiday he should get pay and a half, or even double pay, but let us remember this: most of these employees already have holidays with pay. Triple pay is altogether out of the question.


Leon David Crestohl: We could amend that in committee.


J. Nicholas (Nick) Mandziuk: I admit it could be amended. I am expressing my views on the principle of the bill. I could go into the various clauses, but that is not what we are discussing at the moment.


An hon. Member:: The bill killer.


J. Nicholas (Nick) Mandziuk: Has the hon. member a question to ask? I am only trying to tell the house something which is of interest to me and, I believe, to a lot of people. There are many in this country who do not even get a living wage. How would they look on a situation where someone was getting triple pay for working on a holiday? Some people would be happy to get a job at all.


An hon. Member:: Especially under your government.


Mr. Speaker:: Order. I would caution hon. members against speaking from their seats when they have not got the floor. This also covers hon. members who are not seated in their own seats and who wish to contribute to this debate.


Mr. Denis:: O.K. I will do that.


Some hon. Members:: Six o'clock.


Azellus Denis: Enough time to have a vote.


Mr. Laing:: Does a good bill in Manitoba become something for nothing federally?


J. Nicholas (Nick) Mandziuk: This is not a replica of the good bill in Manitoba. All I am objecting to is triple pay on statutory holidays. I do not think that is necessary or fair.


Mr. Speaker:: Order. The hour for private members' business having expired, we shall revert to the business which was interrupted at five o'clock.



[Stage Direction]
House in committee of ways and means, Mr. Paul in the chair.
At six o'clock the committee took recess.
[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
Donald MacInnis: Mr. Chairman, earlier this evening, in response to the allegation that the program and policies of the New Democratic party constitute communism, I had begun to cite authoritative and objective evidence which supports our ideas of increased leadership on the part of federal or central governments in the economic affairs of nations and more specifically in support of our idea of democratic economic planning. As hon. members will recall, I referred first of all to the centre for the study of democratic institutions sponsored by the fund for the republic of the United States and indicated that they had reached the conclusion that the complexity and interdependence of the scientific industrial state calls for national planning.
Second, in answer to the distorted interpretation of hon. members opposite, who seem to be very prone to quoting various encyclicals, I should like to read into the record the official statement of "Mater et Magistra" with regard to the role of governments in modern industrial society. I quote as follows:
Indeed, as is easily perceived, recent developments of science and technology provide additional reasons why, to a greater extent than heretofore, it is within the power of public authorities to reduce imbalances, whether these be between various sectors of economic life, or between different regions of the same nation, or even between different peoples of the world as a whole. These same developments make it possible to keep fluctuations in the economy within bounds, and to provide effective measures for avoiding mass unemployment. Consequently, it is requested again and again of public authorities responsible for the common good, that they intervene in a wide variety of economic affairs, and that, in a more extensive and organized way than heretofore, they adapt institutions, tasks, means, and procedures to this end.
Finally, Mr. Chairman, as evidence of support of the position of the New Democratic party, I would refer to the Lincoln formula which suggests that the function of government is to do for the people that which needs to be done, but what they cannot do for themselves or cannot do so well.
No, Mr. Chairman; socialism is not the issue. Socialism is a false issue. Its supporters can be seen to hide behind a false label because they cannot in a positive and constructive manner criticize what we propose. We do not propose, as would be proposed by a socialistic society, that public ownership take over the means of production in society. We do not propose that the individual should be subordinated to the welfare of the state. We do not propose the abolition of private

property. We propose that society be regulated so that the individual can really grow and develop his full potentials and make his contribution to society.
The real issue in this conflict is the issue of our attitude toward change. The real issue is whether we are going to try to find new methods and new techniques by means of which to handle the new situation in the modern scientific industrial state or rather society, or whether we are going to cling tenaciously, on the basis of tradition, to our old concepts which are no longer adequate. We no longer have a society in which we find scarce resources. We no longer have tremendous and abject poverty, in general, in our North American society. The problem today is not one of production. We have plentiful resources; we have an affluent society. Our problem is one of distribution and one of grappling and coping with the swift scientific advances being made in society.
But, Mr. Chairman, we admit that it is difficult to face up to the question of change. We in this corner agree that there is in man a tendency to cling to the old ways of doing things. There is fear of experimenting with the new. Fortunately for us, however, we are not obliged to experiment. The experience is behind us. The sound democracies of the nations of western Europe have proved that democratic economic planning can provide a desirable and good standard of living for people while at the same time maintaining their sense of dignity and their freedoms.
Change is difficult; but if we appear to be anti-change while our opponents are prochange, we enter into competition for the minds and the hearts of people with a hopeless handicap. We must be prepared to change our methods on two accounts. Internationally the uncommitted developing nations of the world need our financial assistance. They are looking to us and are investigating our techniques and our methods in order to see whether democracy is the answer; and the choice precisely is between democracy on the one hand and communism on the other. I suggest to you that in western Europe again, the western European democracies, precisely because they have adopted democratic economic planning, are refuting the need for the existence of this philosophy of communism; and in these countries there is no danger of a communist doctrine taking over. But second, Mr. Chairman, and perhaps more to the point, domestically we are approaching a type of economy in which there simply will not be enough jobs of the traditional kind to go around. If we are not prepared to cope with 27507-3-71
Ways and Means
this problem a social and political crisis will be the result.
Planning has generally been accepted in Canada today, even among some elements of the chamber of commerce, and I daresay that the New Democratic party is to a great extent responsible for legitimizing this word and this idea. There is a difference, however, between the ideas there are in this house with regard to planning. I am not going to discuss the planning ideas of the Social Credit party because it seems to me that their philosophy is that, that government is best which does not govern at all. I am not going to talk about the attitude toward planning of the Conservative party because I am afraid that with their traditional Conservative approach to problems they are not prepared to make the changes necessary to adopt this idea of democratic planning.
This leaves us then with the Liberals who seem to have agreed with us that planning is a good thing; but once again, unfortunately, we must point out that the Liberal association with planning represents the adoption of a word rather than the acceptance of an idea. For example, I should like to quote for the record an official statement made by the planning expert for the Liberal party, Mitchell Sharp, when he said:
Nothing in my experience leads me to believe that the decisions of any group of public servants, however able, could or should be substituted for the decisions made by businessmen competing freely in the marketplace.
This statement can be found in the Toronto Star of January 12, 1962. This is precisely why the planning program of the Liberal party is not the answer. They say that it must be left up to private enterprise but we know that private enterprise is interested solely and entirely in their own personal profits. This is their reason for existence. We say as opposed to this that we must democratically plan and control the affairs of the nation in the interests of the common good. Our planning is precisely democratic because we say that we would set up a planning board which would be responsible to cabinet, which in turn would be responsible to the House of Commons. Nothing is more democratic than this part of our program. Planning is indispensable, I suggest, if we are going to make sense out of our future in this nation.


Mr. Stewart:: I wonder whether the hon. gentleman would permit a question?


Donald MacInnis: When I have concluded, Mr. Chairman. If we are going to face up to the tremendous implications of the new trading patterns that are developing around the world we have to accept democratic planning. If we

Ways and Means
are going to provide for a faster rate of economic growth we must plan how we are going to develop our resources and in what direction.
I would go so far as to suggest that we have two choices before us in Canada. There is either going to be economic union and eventually political union with the United States, or else we can maintain our political independence by adopting the democratic economic planning of the western European nations and then taking advantage of the tremendous new trading opportunities which will be open to us as a result of President Kennedy's trading legislation.
So I suggest that the time is ripe for doing away with phony verbalism. Let us get on with the job of building Canada. For those willing to admit that free enterprise is not a divine dispensation and capitalism not a dictate of some natural law, the need and, indeed, the tremendous value of democratic economic planning to man and his future is everywhere evident. It is imperative in these times to revive respect for law and government as the proper institutions of the general welfare. Without such understanding the economic future of this nation of ours will be determined, warped and, indeed, undermined by the accidents of private ambition and the hope of private gain.
(Translation):


Mr. Frenette:: Mr. Chairman, as this is my maiden speech in this house, I am very happy, like those who have already spoken, to congratulate you on your election to the responsible office you occupy and I wish to assure you of our co-operation in the discharge of your difficult and important duties.
I listened with earnest interest to the hon. members who have taken part in this debate. Mr. Chairman, I feel a great deal of sympathy toward many of them. There is absolutely no doubt about their sincerity, but they keep wandering in the maze of outdated economic theories, which no longer meet the needs of a modern administration.
Whatever certain members or certain political parties may think, the main problem facing us is one of economics and finance. This problem is so important and is so diversified in its aspects that it almost discourages any initiative and consequently becomes obstacle No. 1 to any true expansion. Whatever the level attained, whether municipal, provincial or federal, the result is a wandering in a maze of dead end avenues.

I have much regard, Mr. Chairman, for all scientists and economists, but with all due respect for their knowledge and culture, I believe the time has come for them to learn that the period of trials and errors has now passed and that their period of experimentations has served to show this country their lack of competence, or even worse their deliberate maliciousness.
This session is now entering its second month, and my colleagues in this house, one after the other, both my honourable friends opposite and my honourable friends to my right, have mustered the full implement of their rhetoric and talent to prove the tottering of our country's economy and the absolute necessity of putting the tiller hard over in order to give new impetus to our economy toward a peak, and to enable Canadians to adequately play their parts in all walks of life.
The money-debt system necessarily results in interests, and interests, in their turn, true offsprings of a diabolic financial system, result in general taxes and income tax. We can see very clearly, Mr. Chairman, that our governments need some money for the administration of the nation. But what we do not agree to-and that is why we are in this house-is the excessively heavy burden of these general taxes and income tax, which paralyses private industry and slows down our economic development.
What we are fighting is a system which goes against the sacred rights of the individual and deprives him of part of his freedom. We are constantly progressing towards a system where the individual will be replaced by a number, and will be robbed of his individuality in the process, for in that system the human being will be of secondary importance, and the individual will be a mere cog in a huge piece of machinery called public administration.
We are proud to belong to a democratic government, it actually is the best we can have; but for goodness sake, let us not, in the name of that democracy which is dear to us, play into the hands of our enemy by killing personal initiative with systematic planning.
If our country now occupies a privileged position among nations, if Canada, thanks to the constant labour of its citizens, has managed to develop its immense possibilities, it is thanks to the full and complete freedom of action which has presided over its destinies.
Our financial problem is complex. Those who are now in control of money and credit are powerful, and they want to maintain their hold. Our money system is basically

unsound. The basic institutions in our whole economic structure are worried and they should be.
All classes of society are alarmed. Our debts are increasing all the time, interest rates are climbing and represent a far too high proportion of our budgets. Figures have already been quoted, which I do not think necessary to repeat. What answer do we have to all the questions that are being asked?
Every member of this house has received a mandate from his electors. Each and every one of us has a strict and specific duty to perform. Each member of the house, whatever his political affiliation, is formally committed to his fellow citizens and the country as a whole. We should, at this stage of the debate, fully and squarely face the problems before us.
The group to which I am proud to belong is suggesting as a remedy to our precarious situation a complete reform of our monetary system. "Utopia", some economists will say; and politicians talk about "funny money". Now, Mr. Chairman, it seems that as a result of our active presence here, certain persons who, until today, systematically refused to study our doctrine, have already begun to do so, and we are especially happy to note that many members are also studying, in an objective way, the Social Credit principles we stand for. I should like to quote a sentence from Claudel which makes very much sense when you think about it:
The truth of a proposition has nothing to do with the number of people who reject or accept it.
We realize, Mr. Chairman, that the full and immediate application of our principles would create a rather difficult situation in this country, but we are convinced, because we want to be honest with our electors and with the Canadian people, that the time has now come to start reforming our monetary system and to pursue that reform gradually, as circumstances and the country's requirements will allow.
We urge that positive and effective action be taken immediately to enable every Canadian citizen to develop freely in his own chosen field of activity, according to his needs and to his natural disposition. We want to warn the government that we do not intend to prostitute our movement and that if they keep ignoring our just claims, we shall have no alternative but to make it for them, as for any responsible government, a matter of life and death.
27507-3-71J
Ways and Means
Unemployment is a social evil that we must fight. I am a labourer myself, a union member and also the mayor of a small town with a labour population in a proportion of 95 per cent and I am familiar with the concern and great distress of that important social class. The first measure that we advocate is the establishment by the government of a municipal development bank whose role would be to provide to municipalities, without interest or rather at administration cost, in conjunction with provincial authorities and with due respect for their autonomy, the necessary funds to enable them to realize the public utility projects that the whole population so badly needs.
Those measures will serve a double purpose; they will put an end to unemployment, a real social evil, and solve the most urgent problems of the municipalities. Waterworks, sewers, sidewalks, street lighting, public park developments and many other projects are waiting, precisely because our municipal corporations lack the required funds.
Let me recall an experience I had as mayor of my village. During 1961, the municipal corporation of which I have the privilege of being the head carried out waterworks projects for about $200,000. Well, Mr. Chairman, because of our interest bearing money-debt system, my fellow citizens will have to pay $520,000 for a $200,000 service. In my opinion, that is a situation which has been going on for too long and which must be corrected at all costs.
The winter works program has certainly been a welcome experiment and the minister responsible for it deserves our commendation. But, to my way of thinking, that is nothing but a pain-killing poultice and not the effective cure for a much more deeply rooted disease.
Mr. Chairman, so long as we do not strike at the root of the evil, and the real cause of the hideous evil of unemployment which has marked our age is not readily recognized, we shall keep going round in circles and we shall never come out of it.
At the risk of incurring the wrath of the eager profit seekers, I say that one of the best solutions open to us is the setting up of that municipal development bank and I venture to point out to hon. members of the government that if they want to survive the present crisis, it is a must for them to listen to us and take really effective measures to fight unemployment.

Ways and Means
Mr. Chairman, 1 have a formal undertaking with my fellow citizens and workers and I am not going to bargain with government authorities on that matter. We, Canadian citizens, are first class citizens and we insist that our rights be respected, including the right to live a real life in the fullest meaning of that word.
We owe a great deal to our business executives and I admit it, but we also owe very much to the working class of our country which has shared to a large extent in the development of our resources. Through fair legislation, we want to create within the Canadian nation a climate of understanding between management and labour, which will enable the Canadian nation as a whole to benefit from the begt elements on both sides.
I noticed, with dismay, that considerable cuts had been made in the estimates of the Minister of Public Works (Mr. Fulton). Having a special interest in that matter, my constituents are worried by the cuts made in connection with this important department. In view of the fact that they do a large share of the construction work of the federal government, the stone and granite workers are worried and wondering what the future has in store for them. For a few years now, the chief public works architect seems to have a particular taste for imported materials. Let me remind you at this point-and I am not afraid to call myself an expert on that subject-that in Canada, in the province of Quebec particularly, and especially at Saint Marc des Carrieres, he will find the stone which will meet the requirements of the Canadian climate and the basic rules of architecture.
Our products are good, our workers are experts in their trade. Let us show them confidence and show foreign visitors that Canada has not only good materials but also expert workers who are capable of making the best possible use of that stone.
As the member for a constituency only a quarter of which is inhabited, I am sure I will be allowed to expound here a project which is particularly dear to our hearts, the development of roads to resources.
The riding of Portneuf, which has been blessed by divine Providence, with enchanting and truly exceptional sites, has remained forgotten and anonymous because of this lack of roads.
We are in urgent need of highways which would serve as links between Quebec city and Lake St. John, Quebec city and the northern reaches of the province, Baie Comeau and the whole Abitibi region. Such highways would certainly be an efficient contribution to that decentralization of industry we need so much and they would also open access to resources, up to now undreamed of.
All these steps, Mr. Chairman, can only be implemented by putting at the disposal of the provincial administrations considerable amounts or, which would be even better, by giving them back what the federal government gradually took away from them during the war.
Canada being the result of co-operation of the provinces, the most important thing is first of all to respect their rights.
Our farmers are hard up and unable to sell their products at prices which would allow them to operate their farms. We hear justified complaints about farm desertion and the exodus toward the cities, of the younger generation especially. But, Mr. Chairman, these young people who leave the farms do not want to be considered as second class citizens any more when they see their fathers work from sunrise to sunset without managing to provide their families with the minimum of comfort and welfare which they are entitled to.
It is no use flattering the farmers at election time and telling them what a noble and worthy profession they have. What farmers want is the right to live on the plot of land of their forefathers, the right to remain there as masters and the right to help their sons start out and live in the neighbourhood of the family farm. That is what our farmers want and what they are entitled to. We will succeed in that only if our agricultural products find markets at prices which are fair and reasonable.
It is not logic, Mr. Chairman, that our farmers should have to mortgage their farms to have the right to live on them. Farm credit certainly plays a large part in our economy, but let us not forget that the success of the Farm Credit Act depends directly on the need in which our farmers find themselves now because for too long, unfortunately, our farm legislation has been improvised by politicians rather than directed by true legislators familiar with the problems of our farmers.
Mr. Chairman, we deplore once more the deficit of the Minister of Finance (Mr. Nowlan) which amounts to approximately

$500 million. That is a new argument in favour of our monetary theory.
We dare our hon. friends not to increase the burden of taxes which will soon amount to 50 per cent of the value of our products. They realize that the people's needs are ever increasing. So they try to find excuses and they come up with one deficit after the other, or five in as many years.
Mr. Chairman, the moment of truth has almost come. We shall no longer tolerate the pursuance of an ostrich policy, and the situation will have to be faced. Last week, the hon. member for Lapointe (Mr. Gregoire), in a brilliant statement of our principles, put forward many suggestions. We know very well that however logical they may be, the measures he advocated will be ignored by this house, but for goodness sake, let the government suggest at least something new. Let them propose new solutions, since the ones submitted in the past have brought on the failure we are experiencing today.
What we advocate is the control of money through the Bank of Canada. Money which is meant to facilitate the exchange of goods has become a heartless and ruthless master demanding slavery.
Let us put things in order and let us, through an imaginative legislation, give the consumer the purchasing power he requires. Then, only, will we restore the lost balance and will we, at last, see our Canadians give their full measure and fulfil their mission in the world with dignity.


Some hon. Members:: Go on.


Rémi Paul: Has the hon. member the unanimous consent of the house to go on?


Some hon. Members:: No, no.
(Text):


Mr. Patterson:: Mr. Chairman, although I had the opportunity of making two or three very brief interventions in the debates thus far, this is the first opportunity I have had to deal in detail with some of those problems which I feel are of vital importance to us. This opportunity not only gives me the privilege of mentioning some of our major national problems but also the privilege of bringing to the attention of the committee some of the situations which exist on a more or less local level.
During the debate to date the shortcomings of the government have been pointed out in great detail. I believe the present administration missed one of the greatest opportunities
Ways and Means
ever presented to any government in any country and in any age when, having an overwhelming majority in the last parliament, it could have promoted and implemented new and dynamic policies that would have placed Canada at the top of the list and proven beyond any question the potentiality of a free democratic society.
Instead of that what did it do? Instead of moving forward in these positive ways it began to perpetuate the follies of the Liberal administration. The members of the government lost the vision and they settled back into mediocrity.
I remember the former Liberal prime minister making a statement after his defeat in 1957 that the people voted for a change but all they got was a change of faces. I would suggest, Mr. Chairman, that actually there is not very much basic difference between the Liberals and the Conservatives.
References were made during the course of this debate to the tight money policy of the present government. It was brought to our attention by the hon. member for Davenport. It is true that under the present administration we have tight money; but remember, Mr. Chairman, we have had it in the past, we still have it, and to all appearances we are going to have it for some time to come. But I would remind the committee that during debates several years ago, when I had the opportunity of being here, I heard the Conservative members loudly berate the Liberals for their tight money policy. In fact up in my office I still have a sheaf of papers, clippings and documents pointing out the serious effect of the tight money policy instituted by the Liberals on the various segments of our economy. Therefore when the hon. member for Davenport says a vote for the Conservative party is a vote for tight money I would suggest that, apparently in this particular respect at any rate, there is not very much to choose between the Liberals and the Conservatives.
The hon. member for Davenport also spoke about high taxation. He said a vote for the Conservatives would be a vote for high taxation. Well, Mr. Chairman, I have a very interesting document in my possession. It is called "Highlights of Progressive Conservative Policy" and purports to be quotations from Mr. Diefenbaker's speeches back in 1957 when he referred to the Liberals as a high taxation party and said:
-we believe that a major reason for the serious trade situation is that we are being taxed out of the markets of the world by unnecessarily high
taxation.

Ways and Means
He went on to say:
I believe the entire tax structure in Canada needs to be overhauled with a view to providing encouragement to the promotion of primary and secondary industries in our country.
So we find here again that apparently there is not too much difference between the Liberals and Conservatives, because they both believe in tight money; they both believe in high taxes. Then we find that under fire, what do they do? They point out similar actions taken by the others when they were in office and give that as a reason for warranting their pursuing the same policies. The Liberals apparently are greatly concerned about the members of the Social Credit party in this house. In fact, Mr. Chairman, it seems they have appointed their hatchet men. I refer mainly to the hon. member for Laurier. It seems to be his mission to try and annihilate the Social Credit party, perhaps with the intention of trying to whip Quebec back into the Liberal vote. But I would suggest that his frustration is clearly obvious. I think he had better do just a little more homework and do it more thoroughly, or his reputation as a Liberal brain may suffer some serious setbacks.
Last evening the hon. member for Laurier made some reference to Social Credit. By the way, Mr. Chairman, there have been a number of references to Social Credit and once or twice I have been on the verge of complimenting some of the hon. members for studying Social Credit. However, I exercised a little restraint and did not do it, and now I am glad I did not because I find that afterwards they indicated very clearly and conclusively that they just do not know what they are talking about when they talk about Social Credit. Last evening the hon. member for Laurier quoted from a document which was numbered 7-62. I have a copy of that bulletin here, Mr. Chairman; it is information bulletin 7-62.


An hon. Member:: Where did you get it?


Alexander Bell Patterson: That would be interesting. We have it on file, you know.


Mr. Forgie:: Tell us where you got it.


Alexander Bell Patterson: Anyway, the committee will remember that the hon. member for Laurier referred to that particular document, reading from another one, and inferred that it was an official publication of the Social Credit Association of Canada. I would like to repudiate that this evening, because it is absolutely false. If the hon. member had read the last part of this particular document which I have here, he would have seen it makes this statement, that this secretariat- which he was quoting-has no connection

with any political party. I would suggest that the hon. member for Laurier was shooting in the dark, or else there was some other motive behind his reference to that document. It is unfortunate that the hon. member is not in his seat this evening. No doubt he has other responsibilities. I do not like talking about an hon. member or referring to him when he is not in the house, but I felt this was the only opportunity I would have in this connection.
The Liberals are trumpeting loudly about the glory that would accrue to the Canadian nation if they were in office. I would remind them that they had 25 years to prove that.


Some hon. Members:: We did.


Azellus Denis: We did; that is why you are still alive.


Alexander Bell Patterson: Perhaps, Mr. Chairman, these initial remarks might be interpreted as being political. If that is so, I would like to change the picture and go along to dealing with a number of matters which I feel are of vital importance. We believe very strongly that there should be set up a department of dominion-provincial relations. Some would say that we already have enough departments in this government. Some would say that we already have too many. They would also suggest that adding another would only result in a duplication of activities and interests. However, I strongly believe that if Canada is to remain strong and united within the framework of our constitution, close and careful attention must be given to the development and maintenance of a mutuality of confidence and co-operation between the national government and the respective provincial administrations. I believe the best way to accomplish this objective would be to have a special department with a full time minister who would take care of this particular aspect of our national and provincial activity and give his full attention to it.
I know that the problems and issues that could be handled by such a department are many and varied, but I would like to refer to just a few this evening to point up what I have in mind. Some references have been made by hon. members of this particular group to the setting up of a municipal development bank. I would suggest this is one of the most pressing needs of our country at the present time. Adequate capital at the lowest rates of interest should be provided for use in non-productive projects. We would also suggest that this bank, the municipal development bank, would be an agency of the Bank of Canada. I believe this is a vital need in our economy today.
I should like to read an excerpt from a statement made on November 8, 1960 by the

Canadian Federation of Mayors and Municipalities to the government of Canada.
The high cost of municipal capital borrowing continues to harass municipal governments. The prevailing situation is no different than it was a year ago when the federation pointed out that, unless the cost of money can be reduced to within the capacity of municipalities to afford, there could develop a serious setback to the progressive effort which municipal governments have been making in an endeavour to at least keep pace with their minimum growth requirements.
I should like to quote further, Mr. Chairman, but I believe that points out what I have in mind. Therefore, we have the need of municipal governments requiring to provide for their people the facilities and services at their particular level. The need is there. But we also say there is a tremendous possibility involved here, if we had a municipal development bank set up from which money could be provided, at the cost of administration, for use in the construction of vital projects such as hospitals, schools and other facilities in the public service.
As the leader of this group, the hon. member from Red Deer, pointed out, by the time the cost of such projects is repaid, it amounts to over twice the original cost of the project. Therefore we ask this question: why should this be so, when the facilities of the Bank of Canada can be used to provide this capital? May I also say, Mr. Chairman, that if this method were used it would ease the crushing burden on the municipalities and would enable them in turn to either increase the required services to the people or on the other hand reduce the rate of taxation. We believe, again, that if this method of providing social capital were used it would also leave private capital for investment in productive enterprises.
I took a clipping from the Montreal Gazette of this morning, October 30. In the very first paragraph of this article I read:
The Canadian Federation of Mayors and Municipalities raised yesterday the question of making home owners' municipal taxes deductible for federal income tax purposes.
Then it goes on:
-the federation concentrated mainly on a long standing proposal for a national municipal loan fund, otherwise known as a municipal development bank.
It seems that if this particular facility were provided it would be a tremendous boon to the municipalities in meeting the costs of services for their people. I would suggest, Mr. Chairman, that this is one of the things that could be under the supervision of a department such as I have mentioned, a department of dominion-provincial relations.
I should like to refer to another aspect of the financial situation. I believe the time has
Ways and Means
long passed when we should have addressed ourselves to a reallocation of the tax dollar. Serious attempts must be made to provide for a more equitable allocation of the tax dollar as between the three levels of government. Though charged with the responsibility for providing the greater share of services, the municipalities and provinces receive only a minor share of tax revenues. Then, as the trend towards centralization continues in government, we find an ever increasing tendency on the part of the government to invade fields which really belong to the other levels of the administration. I think it is clear that the present formula is far from satisfactory. We remember the answer which was given by the Prime Minister to the pleas made for a more equitable division on the grounds that provincial and municipal governments were unable to meet their obligations. The reply was, in effect, that if they did not have enough money they should go back and tax the people some more. This was from a government which during the 1957 election campaign had complained bitterly about Liberal policy in this respect and promised a revision of the whole taxation structure. Five years has elapsed, and only now has a commission been appointed to look into this question. If I remember correctly, the Associate Minister of National Defence said this matter was going to be considered immediately. Well, five years have gone by, and I think it ought to be considered immediately if our policy is to meet the need. This, too, is a matter which could be taken under advisement by such a department as I have suggested.
I should like to refer to two or three projects which mainly have to do with the province from which I come. The first of these affects us seriously, as well as in addition affecting the whole economy of Canada. I would refer to the Columbia river project. I do not intend to deal with this subject tonight to any great extent, but I am confident that had we a department of dominion-provincial relations there would have been no need for the unpleasant and confusing situation which has developed over this great program. There have been many discussions, many debates, many articles written on this subject in papers across the country. There have been representations and misrepresentations. I feel that if there had been a department charged with the responsibility for dominion-provincial relations, retained a great deal more co-operation and such a situation could have been worked out on a harmonious basis and we would have respect between the dominion and the provincial administrations.


George Clyde Nowlan: I do agree with the hon. member who has just sat down that there are many issues with which we are concerned and that we have many opportunities to discuss them. I do not know what the leader of the house has in mind, but I would expect that, possibly early next week, we shall have a motion to go into supply. There will be various other opportunities for us to debate these matters.
We have now spent six days engaged in a general discussion. Monday and Tuesday of this week have gone by, and there were Monday, Tuesday, Wednesday and Thursday of last week. We shall have to spend a day or two at least dealing with the detailed resolutions. Of course, I am in the hands of the committee, but I would hope that if it were agreeable to hon. members we might go ahead now with the detailed discussion of the resolutions before us and leave the general discussion of economic matters, which, as I say, has now gone on for six days, to other occasions. I assume there will be many of them. Certainly, next week there will be one. when we could carry on this general discussion on subjects of interest to hon. members.
We have had a high level of debate. I think the level has been very high. I do not wish to curtail the rights of any hon. member; indeed, I could not do so even if I wanted to, because this is an unlimited debate. But the government has to get these resolutions through or, at least, it should do so, in order that the income tax legislation may be completed and returns filed before the end of the year. This is vitally important to many individual taxpayers throughout the country. If it is agreeable to the committee, I should like the committee to move now to the income tax resolutions. As was suggested by the hon. member who has just resumed his place, there will be other opportunities to deal with many of the questions which have been raised so far. If that course is not agreeable, then I reserve the right to speak later on, but I think in all circumstances the general debate could now be concluded.


Lionel Chevrier: I think those who sit on this side are in full agreement with what the minister said. There has, I believe, been a full and complete debate. I, too, would not wish to create the impression that we in the official opposition want to curtail the discussion in the slightest degree, but in order to substantiate what has been said I can only add that we have been waiting for this for the greater part of the day; for some time we have refrained from putting speakers up to

discuss the general statement which the minister made. Of course there are members who are ready and willing to speak but they too have felt, along with us, that the time has arrived when we might well leave the general debate and enter into a discussion of the detailed resolutions. So far as we are concerned, we would be prepared to meet the suggestion made by the minister.


Rémi Paul: Shall the resolution carry?


Douglas Mason Fisher: Mr. Chairman, it is very difficult for us not to give way to pleas of such a charming person as the Minister of Finance.


George Clyde Nowlan: Mr. Chairman, the apology is accepted.


Douglas Mason Fisher: In so far as we are concerned, we have two more speakers and we do not feel that their remarks will take any disproportionate share of the time of the house. I must say that it almost embarrasses me to go ahead when I realize the sacrifice that is being made by the Liberals across the way. Last week I read with interest that the troika, the three key members of their front bench, had been called in to the leader's office, according to a report in the Globe and Mail, and had been asked to restrain themselves in order to give the men in the back benches a greater opportunity to speak. Here it seems that not only is the front bench willing to sacrifice but so is the back bench. I can only compliment them on this situation.


Mr. Pickersgill:: For the general good.


Douglas Mason Fisher: When the minister introduced this debate amongst his lead remarks were these very pleasant ones as found at page 795 of Hansard:
The Canadian economy has been expanding. Employment has been increasing and unemployment is decreasing. Our exchange position, Mr. Chairman, is improving and prices have remained relatively stable. The present performance of the economy is impressive by many standards.
That came to a good level of optimism. Later on before he sat down as found at page 808 of Hansard, he uttered these words:
Mr. Chairman, without any vainglorious boasting whatsoever, I simply say as a simple matter of fact and place it on the record from the figures which I put before the committee this afternoon and this evening, that the statements made by my colleague and myself in recent months with respect to the economic situation in this country have been entirely justified and that we Canadians are living in the most prosperous year in Canada's history.
I should hope I can say this with some vehemence. After repetition of this modest appraisal of the Canadian economy let me go on. Later on the minister said this as found
Ways and Means
at page 809 of Hansard. He is referring to these measures. He is talking about measures that need to be taken:
These measures must have two basic objectives. First, they must put Canada in a position to export substantially more goods and services to other countries. Second, they must put Canada in a position to produce more of its own requirements on a fully competitive basis. Our approach to achieving more economic growth and solving the balance of payments problem is expansive, not restrictive.
I read these remarks, Mr. Chairman, in order to point out that the new Minister of Finance is optimistic. We have had the most prosperous year in Canadian history. In other words things look fairly good and there are plans for the future.
I now wish to go on, Mr. Chairman, to deal with what was an experience of mine in the last parliament and many members who are in this one did not share that experience. I followed closely the performance of that government from the time it came in here with that surging crowd of hopeful, eager, gay faces, back after the election of 1958. They surged right around this room and almost pushed us out of that far corner of the chamber down there. They were here in all their glory for those years. I had the opportunity to watch them closely. I shared a room along the same corridor with many of them. I listened to their hopes, their deams and their aspirations as they all dovetailed in to support the great vision which had brought them here.
From them I gathered a bit of material. Many of these people, I suppose advised by their national headquarters, kept in touch with their constituents. I have here a collection of material. For example, here is a very nice letter sent out by the former member for Burnaby-Richmond. And when I read this letter I find that it begins in this way, "Dear friends in Burnaby-Richmond". It then goes on to tell of all the marvellous things that had been achieved, quite in keeping with what the Minister of Finance said at the start of this debate. I am almost saddened to note that the hon. member for Burnaby-Richmond is not here. Then I have here a wonderful letter. It is from Dave Walker, former member of parliament for Rosedale. This letter just went out last fall. It is a very friendly letter, as one would expect from the former member for Rosedale. These are some of the things that he said:
There has been a noteworthy improvement in the employment situation; more housing and low rental accommodation are being built; the winter works program is being extended; huge technical and vocational training programs are under way; and exports are increasing. At the United Nations,

Ways and Means
Canada is a world leader In the campaign to end nuclear bomb testing and in the study of the nuclear fallout hazard.
Details about these and other important matters, which I trust you will read and think about, are on the back of this letter. I hope also that you will write me your views and let me know whether there is anything I can do for you personally.
Then he goes on to give a few intimate details about how he is trying to serve Rose-dale.


An hon. Member:: And where is he now?


Henry Frank Jones: We certainly elected a great many more members than you did.


Douglas Mason Fisher: The hon. member for Saskatoon has interrupted me with a certain amount of vehemence. Would he give me the opportunity to go further in setting out the record of his government? He must admit that I am quoting from legitimate sources. I gathered such things as this, "Prime Minister Scores Again in Great Commons Speech". This literature went out in hundreds of thousands of copies and I managed to get one. Here are some of the things it said:
University grants doubled over 1957 level.
Second P.C. increase In old age, blind, disability pensions.
Exports up.
Farm income hits new high.
Employment production exports.
Exports up.
Production at new peak.
Help for Canadian magazines.
Free speech buttressed.
Canada tired of Liberal attitude.
Expansion accelerates.
Mining, gas show increases.
Predicts G.N.P. rise of 7.3 per cent.
Another waterway project.
Another $40 million acreage payment.
Steps to increase trade.
And so on. Then we have this document entitled, "The Record Speaks". I may say that it fits right into the modesty with which the Minister of Finance introduced this debate. I hope some of the new members who have not seen this pamphlet will take the opportunity to get it. I will lend them my copy. "The Record Speaks" has on the front of it one of these modest quotations rather in keeping with the general mood of that parliament; I refer to the last one. It states as follows:
The government of Prime Minister John Diefen-baker has accomplished more for the ordinary man and woman of Canada than any government in our history.
Mr. Chairman, not long ago in committee I made some remarks about the Liberal party and I did not get anywhere near finished with them. When I had told this to one of my Liberal friends he said this: "I would not go on if I were you. You will get the reputation of being an anti-Liberal or a pro-Conservative". From this applause which I have

received I judge that this is altogether likely to happen. I suppose hon. members can keep me drowned out to the end of my speech. I hope they will let me go on in fairness quoting from the record here so that at last I can give my own interpretation of it.
"The Record Speaks", which has this magnificent quotation on the front, was followed by some other pamphlets that show typical restraint-"Still More Action For Canada And Canadians", and "Four Years Of Action For Canada And Canadians". In them you get words such as these: "The greatest advances in social justice in Canadian history have been made by the government of Prime Minister John Diefenbaker," and "the greatest and most imaginative program of national development in the history of Canada is under way".
And so it goes. This is the kind of record that we have. I have here a publication called "The Conservative Canadian". It is, I think, an attempt-I hate to say this-to copy "The Canadian Liberal". This publication goes into the record. This is the kind of article that we have here: "Meet Canada's Newest Supersalesman". Then there is a picture and a flattering article about the Minister of Trade and Commerce.
All these quotations and examples I have given would lead one to believe, as my friends' applause would indicate, that everything is for the best in the best of all possible worlds, that this government has had this marvellous, stupendous record, that things were never better than they are today and this is the most prosperous year in Canadian history. I suppose there are people who accept this view; but the point I want to touch on and what I want to turn to is that somewhere in the midst of all that confidence that was breathed by all the 208 who came down here with their vision and their great leader, something went wrong. Colloquially something went haywire. We had an election last June and if the government of the Prime Minister accomplished more for the ordinary men and women of Canada than any government in history it is inconceivable that they should have been at least partially rejected at the polls last June.
If this record was the truthful case one would expect that there would have been some kind of triumph. Instead we have the Conservatives here with a minority government. I should like to suggest that there are a number of reasons why this took place despite all these marvellous actions. Despite the wonderful level of the economy about which the Minister of Finance has talked, somehow the Canadian people did not get the message or got a different kind of message

and partially rejected the government. I think there are some explanations for this. From the record I have read, with all its hyperbole and exaggeration in claims, I think it is evident that this itself is one of the reasons why so many Canadian voters turned from the government at the last election. I think the Conservatives managed to convince a great many people that they were doing a tremendous amount of bragging. Many of the things that they may have been able to present to the people as being things that they were proud of were missed by the very exaggeration of their political approach.
I have tried to understand as thoroughly as I can what really happened to this tremendous support that was there in 1958 and which melted away and left us with a minority government. I have come down to what I think are four key failings of the government and I would begin with what I think is maybe an over-all failing and one that relates to the Prime Minister. The new senator from Pickering, for whom I have a great admiration, in his first speech in the other place elaborated on the theme that there had been too many personal attacks on the Prime Minister. I think it is very easy to get carried away in partisanship and say nasty things about the other people, and I should like to point out to any members of the house who feel I am indulging too much in this that I probably said more flattering things about the Prime Minister in the house in the last parliament than any other member on the opposition side. I thought that he showed prospects when he came to power of being some kind of prairie Lincoln, but I have been very much disappointed. In my opinion, despite the best intentions in the world, he has let the country down and I think it is time that he should be replaced. I hope that the testing of the people is not too long delayed because, whatever my own fortunes may be, I feel that Canada very badly needs a new prime minister.
In trying to appreciate the failings of the government I come down to something that I think the Prime Minister himself failed completely to do, to establish a basis of trust with his own administrators and his own administration. I believe that the key here is that he tended to have an antagonism toward the administrators that he was left with and yet at the same time he did not have the drive or, if one wants to put it this way, the courage to dismiss a number of them so that he could at least feel that he was surrounded by people who were loyal to him.
The second aspect of the Prime Minister in his relation to the administration that I tend
Ways and Means
to find in noting his performance is that he has a very strong suspicion of expertise or the intellectuals or academics, whatever you want to call it. From all that I can gather from watching him and reading his speeches, he really does not want to trust what one might call the experts in problems in depth and, as I have pointed out before, this has had at least one unfortunate consequence. I have been to most of the universities in Canada and I find, for example that most of the academics and eggheads of the country in these places, who I believe have their contribution to make-I know that President Kennedy has found that they have-are supporters of either the Liberal party or the New Democratic party. I can count on one hand the number of academics, especially those of any real ability, who are openly supporters of the Conservative party or who have ever been in touch with any thinkers, including the Prime Minister, that the party may have. That is one vital weakness.
It seems to me that another aspect where the Prime Minister's approach has been weak is with regard to corporate business, and I think the appointment of the senator from Bay street underlines this. The Prime Minister has had a profound distrust of the business community in Canada and as a consequence has never tried to tap or really get in touch with the abilities that lie within the corporate structure of Canada. Hon. members may have had a different reaction but in my view the majority of the people engaged in corporate business in Canada whom I have scratched have tended almost invariably, ever since 1959, to talk Liberal or about what a great man C. D. Howe was.
It seems to me, Mr. Chairman, that this is one of the fundamental reasons why the government, despite the glowing record of their performance which they put forward, was rejected by the people, because their leader was unable to compromise and work with the people in the administration, in the business community and amongst the brains, if you want, in Canada who have a great deal to contribute to the development of policies that are going to make our country great. Having said this, I should like to emphasize that I have no criticism of either the Prime Minister's good intentions or those of any other member of the house or of the government. But there has been a failure, and I point out to the members of the government that failure is no more apparent than in this glowing record that I have quoted or in the glowing remarks of the Minister of Finance when he introduced this

Ways and Means
debate, and then in what happened last June and what is likely to happen in the next election.
One of the points, Mr. Chairman, upon which I have always tended to agree with that columnist and writer in the Toronto Globe and Mail, George Bain, is what he calls Bain's law of political performance. This profound statement goes like this: The inclination of politicians to the performance of actions clearly having widespread public support increases in directly opposite proportions to the distance at which they stand from the next general election. This law, of course, is applying most strongly right at the present time, because I think all of us are aware that we stand imminently close to a general election. I agree with the law in that sense, and I think one of the consequences of the imminence is that politicians are likely to behave in a way to appeal to as wide a public support as possible. I feel that this is what all of us in this chamber are trying to do. One of the consequences, it seems to me, is that we may get a resolution out of this discussion, because we are so conscious of the next election, that will give the people a better opportunity to choose what kind of policies and what party they want.
In this connection, I would suggest to the minister and the government that it is time they gave over the long record of what I hate to call boasting, but it really is this, the long record of boasting that is indicated in most of their party propaganda superlatives in which they indulge, and acknowledge one of the realities of the last election, that they were partially rejected. Then, they should give to us and to the country a more precise, more realistic policy than they have in the throne debate that we have had or in the present budget resolution.
One of the great problems that I encounter in my own constituency is in the field of transportation. I have been here five years. We have talked and talked about freight rates and new railway policies, but we still have not reached any conclusion. We have not made a significant change that I have seen.
In the five years that I have been here, I have heard a great deal of talk about education and educational development, yet we are no closer to a national educational policy than we were before. There are no indicators in the throne speech, nor have there been subsequently, that we are moving towards it. When I first came down here there were many grave doubts as to the way the unemployment insurance fund was being handled. Later, there developed a rim on that fund that jeopardized the whole actuarial principle that was in it originally. Yet, we have had

no action, no indication really as to what kind of action we will have. This has been a live issue for a good number of years. We finally have something new, the so-called Neddy, the nickname that has developed in England for the national economic development board. Here, we have had no real explanation from anyone identified with the government as to what the scope of this board will be. It is very easy for any government member to point out that you cannot reveal this before the measure is introduced.
This is not so. This government has a record of having a spokesman put up a trial balloon; he gives a general outline of the way they are going to go. I recall the former minister of justice did this in connection with his censorship or obscenity law or the change in the censorship regulations. We have had no real indication, even though parliament has been going for five or six weeks, of how the government intends to proceed in connection with this national economic development board. It seems to me that this government is tending to perpetuate the very same tactics that were so disastrous to it in the last parliament. I would plead with them that what the country needs, even though some of us in other parties may not want it, is some real frankness about the legislative policies of the future, about where the government is going.
I should like to suggest to them that if this is not forthcoming, then the record of their party at the next election will be even more disastrous than in the last. They will be out again in the wilderness for years as they were before. All the indications that we have had so far are that they will go on projecting the same kind of record as was available in their propaganda record before. This is really going the way of disaster. If they go on with this line, they will go down. I do not think I am expressing anything other than my own individual views when I say that, whether one is a Conservative, Liberal, New Democrat or Social Crediter, this will be one of the great, sad things in Canadian history, that a party could come surging in here with the greatest approval any party ever had, any leader ever had, and dissipate it in five short years. I think that is the situation.
Now, Mr. Chairman, other spokesmen for our party have touched today on the planning that is the touchstone of the policy of our party. However, before I close I wanted to say how pleasant it was to hear the members of parties, my own and others, talking about their party philosophy, principles and ideas. It seems to me we need more of this. One of the things for which I am still waiting, of course, in this house relates to the hon.

members who represent the Social Credit party. They are very good at charging us and charging the people of Canada with not understanding or not knowing Social Credit. Well, how about telling us about it here? I think, Mr. Chairman, that if they really have something to tell, if they have a code or an answer, I should like to see them put it on the record.


Gilles Grégoire: You have the proof of it.


Douglas Mason Fisher: The hon. member says we have the proof. What I say is that you have to do some more teaching because I still do not understand. I am reminded of the Pat and Mike story, and I think most members have heard it, which explains Social Credit. Pat and Mike both went into business on the same day selling beer. They each had one keg of beer. Business was pretty slow, and they were right across the street from each other. However, Pat happened to have a dime and Mike did not. After a while, Pat got thirsty, went over to Mike, gave him the dime and said, "Could I have a glass of beer?" He had it and it tasted pretty good. He went back and the next thing Mike was over with the dime and he bought a glass of beer from Pat. Then, they went back and forth and managed to achieve total consumption with the expenditure of only one dime. This was a most illuminating story, and apparently it was used in the early days when Social Credit was on the sawdust trail in Alberta to explain these theories. I will agree that in a closed system, this worked perfectly. However, I want the story expanded so I can appreciate it in a fuller society. I should like it to be expanded to Pat and Mike, John and Bill and so on, so that we could see how it could really cover everything. I would hope the hon. member for Villeneuve would take the opportunity some time to elaborate on that Pat and Mike theorem for me. Now, one of the points that is bothering me most in trying to understand the Social Credit argument-and I would ask them to explain it to me-is that they are creatures of completely free enterprise and they adumbrate a society in which a bunch of wonderful small entrepreneurs are buzzing around and giving that society go, fervour and rise. This is their ideal. I have found most small businessmen are in a sense idealistic about themselves and they respond to this idea. But I want to ask the members of the Social Credit party how they are going to do something for the small businessman, the small entrepreneur, without greater government intervention, support and subsidies.
Ways and Means


Alexander Bell Patterson: By giving more money to the consumers.


Douglas Mason Fisher: How can they do this without restricting those elements which control so much of our society in its economic sense? How are they going to do it without restricting them?


The Chairman:: I am sorry to interrupt the hon. member but his time has expired.
(Translation):


Mr. Cook:: Mr. Chairman, I do not intend to delay the house too long. I shall not be more than a few minutes. If some members from this end of the house want to have the floor again, it is because of the unfair apportionment of speaking time as between members at the beginning of the session. A Social Credit member is given the floor for every ten members of the house.


Gilles Grégoire: True.


Jean-Paul Cook: Mr. Chairman, I am not surprised to see the hon. member for Laurier (Mr. Chevrier) supporting the suggestion of the Minister of Finance (Mr. Nowlan) that the debate be closed because in his speech, last night, he made all sorts of promises and there is none left for any other member of his party who would like to take the floor now.
Mr. Chairman, I would like to associate with all the members who have offered you their congratulations on your election to the office of chairman of the committees of the house. The task that you assume is not an easy one and it includes great responsibilities, especially when the house is composed of a minority government and three opposition parties, one of which holds the balance of power, that is Social Credit. However, Mr. Chairman, you discharge your duties with efficiency as we all know.
Mr. Chairman, the government brought to the attention of the house its revised estimates.
Incidentally, I should like to thank and congratulate the Minister of Finance, because we received this afternoon the French translation of the revised estimates for the year 1962-63.


Mr. Robichaud:: This is something new.


Jean-Paul Cook: We notice that the Minister of Finance announces a reduction of about $233,394,305 from the previous estimates, in order to balance those of 1962-63. Out of this amount of more than $233 million, we notice a decrease of $30,076,443 for the estimates for the public works department.

Ways and Means
I realize it is not easy to balance a budget, especially with the monetary system we have at present. I am not an expert in accounting or in figures and that is why I wonder if the cuts that have been made are logical.
In my opinion, the Department of Public Works is one of the most important governmental departments since it has a direct influence on the economic development of the country and of each county in particular. Our counties are more prosperous when the Minister of Public Works has sufficient appropriations to meet their needs.
As for the riding of Montmagny-L'Islet that I am proud to represent in the house, especially since it was long represented by the former minister of northern affairs and national resources, Hon. Jean Lesage, who is now premier of the province of Quebec-


An hon. Member:: Only until next November 14.


Jean-Paul Cook: God knows how much my riding has been neglected all those years.


Mr. Rouleau:: It was not, but it will be from now on.


Jean-Paul Cook: That is what you think. That riding, having been ignored for so long now needs the Department of Public Works. I mention, among other things, the construction of several post office buildings and particularly that of St. Jean-Port Joli. But the most important project is the blasting of the rock range off the wharf of Montmagny. That obstruction has been there in the riding for many years and was in existence under the Liberal regime, at which time requests were made many times to have it removed.
The blasting of that rock range would permit year round coastal navigation. That would have the effect of promoting the international tourist industry because, as every one knows, Montmagny has the finest hunting and fishing club on the whole south shore. That would also enable all manufacturers in the area to load the goods they are shipping on the north shore, or to some other place, directly in their locality. In addition, lumber companies could load their lumber directly at the Montmagny wharf, which, on the whole, would represent a substantial reduction in transportation costs. Many other companies or industries would surely be interested in establishing themselves in our area if water shipping was adequate.

There is also the human side of this problem which could be solved. We all know that lie aux Grues is part of Montmagny-L'lslet county. We also know that this island is inhabited by farmers upon whom rests our very survival. Yet, when they cross over to Montmagny to sell their products, these people often have to pay for an overnight stay and to wait for the next day's high tide before heading back home.
Mr. Chairman, I was also told that this spring a child in lie aux Grues, having suddenly taken sick, had to stay four hours on the wharf waiting for the high tide to be carried to the hospital. In the twentieth century, that is inhuman and unacceptable.
Mr. Chairman, even if the dynamiting of that chain of rocks should solve only the latter problem, the government must take the necessary steps to do it. The dynamiting of that chain of rocks would also allow the sand to disappear with the low tide and make navigation steadily possible at low tide.
Mr. Chairman, I wonder if the reductions made at the Department of Public Works were justified, and I shall explain.
Expenses in that department have been reduced by more than $30 million but they certainly did not forget to grant subsidies to crown corporations, to the prejudice, I suggest, of private enterprises. Therefore those subsidies are unfair, and I want to talk here of the subsidies granted to the C.N.R. In 1961, the Canadian National Railways received more than $81 million in subsidies. Those subsidies, enabled them to reduce their freight rates. The subsidies for 1962 will perhaps amount to $100 or $110 million. On top of that, the federal government makes up for the C.N.R. deficits. For each of the last two years, those deficits probably exceeded $60 or $75 million.
Almost at the very time the last railway subsidy was announced, the C.N.R. reduced their competitive rates below those charged by trucking companies on a wide variety of goods.
Truck owners do not receive any subsidy, either directly or indirectly. By paying high registration and licence fees, as well as heavy taxes on gas, they contribute their fair share to the cost of building and maintaining the roads they use. Since they undermine the basis itself of the competition between railway companies and other means of transportation, railway subsidies inflict heavy and increasing losses not only to truck owners and

to workers and suppliers in the trucking business, but also, and this is even more important, to all the Canadian people who, through their taxes, pay those subsidies to the C.N.R.
There are also those large grants the government is paying the C.B.C., another crown company. If those grants would all come back to our Canadian people, it might not be so bad, and would be rather normal. But, those amounts are partly used to bring French, American and other artists to Canada and, in many cases, to produce films in France which the C.B.C. needs for its local programs, whereas some of our Canadian artists are working for a ridiculous salary, when they are not starving.
Mr. Chairman, there is only one means to remedy all those problems, and it is that the government recaptures control of our currency. Nobody need tell me: "So we did," because it is untrue. Allow me to quote a text published in the Edmonton Journal on November 5, 1959:
In Shawinigan, the Minister of Finance, the Hon. Donald Fleming, stated that the Bank of Canada was independent of Canada and that it could not be ordered to increase or decrease the monetary fund. Mr. Fleming, speaking at a convention of the businessmen's union of Mauricia, added:
I insist upon the fact that the government of Canada has no power nor control with regard to the monetary fund. It may neither increase nor decrease it, and he added that he sometimes received letters asking him why he dealt with the currency reserve as if he was opening or shutting a tap. The truth is, said Mr. Fleming, that the Minister of Finance cannot in the least control the monetary fund.
Mr. Chairman, this is the main objective of the Social Credit, that is to reinstate control of our own currency before it is too late.
Our friends of the Liberal party-and more particularly the hon. member for Laurier-who are criticizing the Social Credit monetary policy to such an extent, would do better to go back a few years and recall that their former leader, who was then prime minister of Canada, the Right Hon. William Lyon Mackenzie King, when commenting on his recent victory in October 1935, said:
The result of the election is a sanction of the views of the Liberal party, that credit is a public matter of concern not only to the bankers, but to each and every citizen. Our victory is a verdict against the national bank owned and controlled by private interests, and a verdict in favour of a
Ways and Means
national bank well established to take care of rediscounting and of the control of money in terms of public necessities. Let there be no misunderstanding about it: this victory is a formal request for a return to government control of credit and money.
Mr. Chairman, during the great depression, the chancellor of the exchequer in the British House of Commons, Mr. Winston Churchill, made the following statement:
I am very serious when I state that this monetary convulsion has reached a point where I am convinced that the producers of new wealth will not tolerate indefinitely such an odious oppression.
I could also quote the words of Lord Beaverbrook, particularly well known in Canada, owner of several newspapers, who has been engaged in banking in the past, when he criticized the monetary system in April 1932. In the following article, we find, among other things:
Our monetary policy should have been reformed a long time ago. The needs of this nation require a constant expansion of credit facilities. The bank is the obstacle which stands in the way, and through the rights acquired a long time ago it has imposed a deflationary policy for the last ten years. The government must be the master in its own house. The government must dictate the monetary policy of the nation, and the bank should be put in its proper place, as a servant of the nation. Give us the right to establish reasonable credit and you will achieve adequate salary scales, price stability in commodities and prosperity for our people.
Mr. Chairman, those words were not those of Social Crediters but of Liberals of that day. The Liberal party though in power for 22 years, did not accept any of those recommendations. It merely rested on its laurels. I would therefore advise the present Conservative government not to do the same thing, to wake up, because at the next federal election, which will perhaps take place sooner than the hon. members think, the Canadian people, which is not asleep, will elect a government which will really take its responsibilities, and that government will be nothing less than a Social Credit government.
Mr. Chairman, all the governments in the world are seeking means to restore enduring peace. It is astonishing to see to what extent, all over the world, men are waging war in the name of peace. Peace, independence, freedom, happiness are at the basis of all the bloody horrors we hear about. Through power and terror we want to make man happy. What a poor and illogical concept of happiness. The only way to restore enduring peace in the

Ways and Means
world is to give each and everyone complete security and total freedom. And it is in that direction that all members, regardless of their political affiliation, should work, hand in hand, in order to achieve that purpose as quickly as possible.
(Text):


Lionel Chevrier: Mr. Chairman, a moment ago I indicated to the Minister of Finance that we on this side of the house were prepared to accept the proposal made by the minister. It was, of course, on the understanding that we could come to a termination of the debate within a reasonable time. I see that is not possible; I understand there are hon. members from the far left who are going to speak, or want to speak, and others as well. Therefore, under those circumstances I would ask you, Mr. Chairman, to be good enough to recognize our side of the house and to see the hon. member for Brant-Haldimand.


Gordon Campbell Chown: The hon. member for Brant-Haldimand.


Lawrence T. Pennell: Mr. Chairman, first may I offer my congratulations to the hon. member for York South for his engaging and compelling address. Unfortunately he disfigured it with a narrow and jealous approach to the question, of political motives, stating that his party alone had the interests of the people at heart, and imputing improper motives to all other hon. members in this house. I also wish to offer my congratulations to the Minister of Finance with regard to the announcement on Monday, October 22, wherein he stated, referring to the government's proposals as found at page 810 of Hansard:
Perhaps the most important development of all is the national economic development board.
These are noble words, Mr. Chairman, but may I say that we view them from this side of the house with some skepticism. It is within the recollection of the minister himself that on May 23, 1960 a similar proposal was made from this side of the house, and when the suggestion was put forth it was sacked and sabotaged by those who now occupy the government benches. The resolution advanced at that time by the hon. member for Essex East at page 4142 of Hansard for 1960 recommended that steps be taken-
-for the immediate setting up of a national advisory board on economic development.
This is what the present government said in reply to that motion. I am quoting, now, from Hansard at page 4163 of the same year

where the Minister of Labour is reported as saying:
On that committee he wants-
He was referring to the hon. member for Essex East.
-representatives of government, industry, labour, agriculture and the universities to serve. On that ground alone I submit that because of the diversity of interests the job of the committee would be impossible from the very outset.
Compare this to what the Minister of Finance had to say last Monday as found on page 810 of Hansard.
It is an essential aspect of national interest to encourage and expand constructive thinking and planning about national economic development by leaders in business, in agriculture, in trade unions and in other major economic groups throughout the country.
It is apparent, now, that they must have changed their script writers since the time the Minister of Labour made his announcement. However, I congratulate the hon. gentleman that after two years of urging from this side of the house they have had another great revelation, another vision. I do not wish the minister to think that we are unappreciative or churlish on this side of the house, because we believe that long range planning is worth while. I am sure he will understand when we say we are glad that they have at least repented, because there is greater joy in the kingdom of Heaven over one Tory who repents over long range planning than there is when ten Liberals reaffirm their principles and their belief in economic planning.
I know the minister will understand and forgive us if we express certain reservations about the implementation of the national economic development board. We have had the example of ARDA which was brought in with a flourish of oratory and which has since been gathering the dust of government complacency. Let it not be doubted that ARDA could be an effective instrument, along with a national marketing board, in advancing the economic interest of this country, but it lies on the statute books without action being taken.
No doubt, the economic expansion of western Europe has been due in part to long-range planning, but we should approach long-range planning with caution. There is no magic economic healing power in planning alone. There has been held before us the vision of a western Europe whose economy has undergone a great expansion as a result of long range planning. However, this is what an authority in Great Britain said about economic planning in France-an authority which, I believe, the hon. member for York South would respect. I am quoting now, from the British Hansard, from a speech delivered

by the Right Hon. Harold Wilson, a labour member of parliament and one of the leaders of the Labour party in Britain. This is what he said on November 7, 1960:
It is right, however, to warn the house against the view that the French economic miracle of the past two years has been achieved by the system of painless planning which the chancellor has in mind. It is the product of two things-two separate devaluations in 18 months, and a 6 to 8 per cent reduction in wage standards.
I am sure the hon. member for York South, along with all other hon. members of this house, would not wish to see our economic expansion take place at the expense of wage standards.
I do not wish to be misunderstood. I am not downgrading long range economic planning. I do say that alone it has no inherent healing power which will take care of all our economic ills.
We have also been given the example of West Germany as being another nation whose prosperity is due solely to economic planning. I would draw the attention of the committee to the existence of other factors which help account for the German recovery. Perhaps the most important single influence is the fact that most of the West German factories were completely retooled and re-equipped after the war, and these new machines and techniques obviously gave Germany a tremendous advantage. Further, due to the depopulation of eastern Germany, there has been an increase of almost 15 per cent in the labour force of West Germany, much of this consisting of skilled workers. This, again, has been an important factor in West Germany's economic recovery.
Business of the House
May I say we are not going to solve our economic ills by generalities, pleasant as they may be, about long range planning. I agree that we must have a list of priorities set up. We must have a plan through which we can weigh the supply of capital and labour, the extent of our exports and imports, the extent of our resources, and so on. We must set up targets for five or six years ahead. That is what has been done in France where at present they anticipate an annual increase in the gross national product of about 5.5 per cent for the next five years. But at the top of these priorities we must place government encouragement to investigation in the scientific field. This, in my opinion, is the most vital question which faces the government today-the amount of encouragement it intends to give to scientific investigation to assist industry in this country.
Progress reported.



BUSINESS OF THE HOUSE

Lionel Chevrier: May I inquire from the leader of the house what we shall be doing tomorrow? Perhaps he will project his mind to cover the rest of the week.


Gordon Minto Churchill: Tomorrow, we shall continue in committee of ways and means. Again, we hope we shall get on to the resolutions and complete them. All being well, on Thursday we shall go on to legislative items beginning with a bill to amend the Farm Credit Act and then the bill to amend the Food and Drugs Act. I will give a more precise outline tomorrow at six o'clock.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Wednesday, October 31, 1962