1962-11-23

[Stage Direction]
Mr. Nicholas Mandziuk (Marquette) presented the first report of the standing committee on miscellaneous private bills, and moved that the report be concurred in.
Motion agreed to.


Mr. T. S. Barnett (Comox-Alberni) moved: for leave to introduce Bill No. C-84, to amend the Transport Act and the Railway Act (B.C. water carriers).


An hon. Member:: Explain.


Thomas Speakman Barnett: The purpose of this bill is to regulate the carriage of goods and passengers by water in British Columbia in the interest of public convenience. To this end, the bill proposes to bring this traffic under the jurisdiction of the board of transport commissioners.
Motion agreed to and bill read the first time.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. J. E. Walker (York Centre):: Mr. Speaker, I have a question for the Minister of National Health and Welfare. In the light of today's report that the Italian government may have taken steps to ban the drug preludin, and in light of the fact that the manufacturer, C. H. Boehringer of Ingleheim, is reported to have said that women in the early stages of pregnancy should not use the drug pending the outcome of investigations, has the minister considered placing preludin under schedule H of the Food and Drugs Act?


Hon. J. W. Monteith (Minister of National Health and Welfare):: Mr. Speaker, my answer to this question would be the same as that of yesterday.
27507-3-123i


James Edgar Walker: I do not think that is an answer, Mr. Speaker, but I have a supplementary question. Will the minister consider taking this step as a temporary safeguard to the public until the results of investigation are available?


Jay Waldo Monteith: My previous answer still stands.


Mr. H. C. Harley (Halton):: I have a supplementary question. May I ask the minister, in view of the previous question, whether he will consider bringing forward Bill No. C-3, now awaiting third reading, for disposition, or again consider sending this to committee?


Jay Waldo Monteith: Mr. Speaker, the leader of the house always announces the business for the day on the previous evening.



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. Arthur Laing (Vancouver South):: Mr. Speaker, I have a question I should like to ask the Minister of Fisheries. Is he aware that the international Pacific fisheries commission has made a recommendation that the principle of abstention be qualified to the extent of permitting entry of Japanese fishermen into the eastern north Pacific ocean?


Hon. J. A. MacLean (Minister of Fisheries):: Yes Mr. Speaker, I am aware that the commission made certain decisions, although I have not yet had the official recommendation of the commission. The matter is a very complex one, and I shall be glad to make a full report on the situation when I do have the official information from the commission. But I should like to add that there is no change in the treaty; the principle of abstention in the treaty is the same as it always was. It is only the application of this principle which is under discussion.


Arthur Laing: A supplementary question.
Would the minister assure the house that before the government accedes to this recommendation we shall have an opportunity to debate the possibly tragic consequences?


John Angus MacLean: Mr. Speaker, I will take that suggestion under advisement but I should like to add, if I may, that I think this question is probably based on a news report in

Inquiries of the Ministry the Vancouver Sun which is quite alarming, especially the headline, and the facts do not justify that headline.



EUROPEAN COMMON MARKET


[Stage Direction]
On the orders of the day:
Mr. D. S. Macdonald (Rosedale):: Mr. Speaker, I should like to address a question to the Prime Minister. In the light of a report in the Globe and Mail of this morning that negotiations on United Kingdom entry into the European economic community have been impeded by the reluctance of common market representatives to extend concessions at this time which would, by article XXIV of GATT, enure to Canada's benefit, and which would not be compensated for by Canadian concessions-


Some hon. Members:: Order.


Donald Stovel Macdonald: -will the government consider empowering a Canadian representative to participate in these negotiations to the extent necessary to overcome such difficulties?


Mr. Speaker:: Order. I think the hon. member is asking the government to comment on the nature of a newspaper article. I think the hon. member will recognize that that is not permissible on orders of the day; I would refer him to citation 171 in Beauchesne.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, may I ask the Prime Minister whether the government is considering sending to Europe with the necessary authority a minister to conduct for Canada negotiations with GATT and E.C.M.?


Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, in so far as E.C.M. is concerned the hon. gentleman of course knows that such a course would be an improper one.



NON-PARTICIPATION BY CANADA IN MILAN FAIR

[Stage Direction]
On the orders of the day:
Mr. J. H. Addison (York North):: Mr. Speaker, I wish to direct a question to the Minister of Trade and Commerce. In view of the announcement by the Ontario government of its intention to participate in the Milan trade fair of 1963, is the federal government considering changing its decision and entering an exhibit?


Hon. George H. Hees (Minister of Trade and Commerce):: No, Mr. Speaker. We make decisions of this kind after very careful consideration. We have participated in the Milan fair in the past. In that fair we found very little interest in Canadian goods, and for that

reason decided not to participate in it this year. We are keeping our eyes on the fair. If there are indications that there would be more interest in next year's fair we will then again participate. I can assure the hon. member that we participate in every fair throughout the world where we consider there is any reasonable chance of doing extra business for Canadians.


Hon. J. W. Pickersgill (Bonavisla-Twillin-gale):: I have a supplementary question. Can the minister say who his eye is in Milan?


John Hollings Addison: I have a supplementary question.


Mr. Speaker:: Order. The hon. member who had asked the question was seeking to put a supplementary.


John Whitney Pickersgill: I beg your pardon, Mr. Speaker.


John Hollings Addison: I should like to ask a supplementary question. Has the Minister of Trade and Commerce received a delegation from the Italian chamber of commerce?


George Harris Hees: Yes. We had a very full and thorough discussion. I explained the situation completely to the delegation. I think they understood fully the reasons why we are not participating this year in the Milan fair.



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: wish to address a question to the Minister of Justice. Has the minister received a billet-doux of any kind from the premier of British Columbia with respect to the likelihood of his visit to Ottawa in the near future?


Hon. Donald M. Fleming (Minister of Justice):: I am sorry, Mr. Speaker, but I did not hear all of the question.


Herbert Wilfred Herridge: Mr. Speaker, I was asking the minister if he has received a billet-doux from the premier of British Columbia with respect to the possibility of his visit to Ottawa in the near future.


Mr. Speaker:: Order. I would honestly suggest to the hon. member that his question is extremely vague. The premier of British Columbia might wish to come here on a social visit, and I do not know that it would necessarily be the subject matter of discussion at this time. On the other hand, if the hon. member can make his question more precise it might perhaps have some relevancy at this time.


Mr, Herridge:: Mr. Speaker, I worded it so as to include the social, the political and the electrical. Has the minister received any word from the premier of British Columbia with respect to a visit to Ottawa in the near future in order to discuss the draft Columbia treaty?


Donald Methuen Fleming: Mr. Speaker, I wish I could give an electrifying answer. However, my answer must be no.



IMMIGRATION


[Stage Direction]
On the orders of the day:
Mr. Hubert Badanai (Fort William):: Mr. Speaker, I wish to direct to the Minister of Citizenship and Immigration a question of which notice was sent to him. My question is based on the announcement made by the minister on November 17 that it is the intention of the government to step up immigration. The question is this. Has the government given any consideration to looking to Algeria where, according to reports, there are a large number of people interested in emigrating to Canada?


Hon. Richard A. Bell (Minister of Citizenship and Immigration):: Mr. Speaker, the particular reports to which the hon. gentleman refers have not come to my attention. I am advised, however, by my officers that as yet there has been no evidence of any substantial movement available either direct from Algeria or of Algerian repatriates from France. However, my officers will give the matter close attention.


John Whitney Pickersgill: May I ask the minister a supplementary question. Can the minister say whether the department has either directly or indirectly any representative in Algeria.


Mr. Bell (Carlelon):: There is no immigration officer in Algeria at the present time, to the best of my recollection.



FINANCE


[Stage Direction]
On the orders of the day:
Donald Stovel Macdonald: Mr. Speaker, I should like to direct a question to the Minister of Finance. Has the government received representations from representatives of the oil industry that certain of the provisions of Bill C-78, amending the Income Tax
Inquiries of the Ministry Act, will have an adverse rather than a beneficial effect on that industry? If so, will the government consider taking legislative action to satisfy these objections?


Mr. Speaker:: Order. If the hon. member will look at citation 171 I think he will find that matters of this kind do not come before the house on orders of the day. On reflection I think he will see what I mean. I recognize the hon. member for Kootenay East.


Donald Stovel Macdonald: I rise on a point of order.


Mr. Byrne:: I should like to direct a question-


Mr. Speaker:: Order. The hon. member wishes to raise a point of order.


Donald Stovel Macdonald: On a point of order, Mr. Speaker, I would submit that this question is of urgent importance as this legislation is still in the parliamentary process. I submit that it does not express an opinion. It merely is a recounting of the opinion expressed by representatives of the oil industry, and very properly should be answered by the minister on the orders of the day.


Mr. Speaker:: Order. I think when the hon. member said that his question included an opinion expressed by the oil industry he indicated that he was putting forward an opinion on behalf of someone. I think it would be more appropriate if he would put his question on the order paper or inquire in some other way.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
James Allen (Jim) Byrne: I should like to direct a question to the Secretary of State for External Affairs. Can the minister tell the house if it is the intention of the government at this session to bring the so-called Columbia draft treaty before the house or the external affairs committee?


Hon. Howard C. Green (Secretary of State for External Affairs):: Mr. Speaker, I think that depends on developments. We have given the assurance that the treaty will not be ratified without being placed before the standing committee on external affairs.

The house in committee of supply, Mr. Chown in the chair.

Supply-Agriculture
DEPARTMENT OF AGRICULTURE Administration branch-
1. Departmental administration including the national co-ordinating committee on agricultural services, $1,003,000.


Lester Bowles Pearson: Mr. Chairman, as a result of one of those last minute changes in the order of business to which we are becoming accustomed now I find myself in a position where I can complete the statement I began a week ago last Wednesday, I think it was, when the Minister of Agriculture introduced his estimates in the committee.
At that time I was commenting on an official visit made by the minister to Saskatchewan where he spoke to the annual meeting of the Saskatchewan wheat pool. This was an official visit as we learned, Mr. Chairman, and on that occasion the minister made certain important proposals. But we were told shortly after they were made, though the audience itself was not told during the minister's speech, that these proposals were made by the minister in his personal capacity on an official visit, and in that sense the minister's proposals as official proposals or official suggestions or whatever you want to call them were repudiated by the Prime Minister. At the time I characterized this procedure as ridiculous, as indeed it was.
1 think you could use the same expression, Mr. Chairman, to characterize the proposal which was made to the effect that the producers should at this date share in the credit risk on deals for wheat sales made with foreign powers, particularly China, when those arrangements were made at a time by the government when the producers were told that the government would take all the risk. When a proposal is made to have an arrangement changed in a way which would repudiate the undertaking previously given, that is also, Mr. Chairman, worthy of condemnation.
One wonders why, when there was a credit risk involved of $170 million-I believe that was the figure-concerning which the producers were told they would bear no share of the risk, that stand should be questioned by the government now when the risk is $190 million. This is something we would like to hear about later when the minister completes his statement to the committee. As far as the suggestion of the producers sharing the risk with the government on future deals is concerned, no doubt the farmers and farm organizations will themselves give whatever consideration is required to any suggestion of that kind. However, they may be confused, Mr. Chairman, in that consideration by the fact that they do not know now whether the

suggestion put forward by the minister was for present arrangements or future arrangements, or whether it was put forward by the minister in his personal capacity and has been repudiated by the government.
Now, Mr. Chairman, the stand we have taken in regard to this particular matter does not represent, as I said the other day to the committee, any change of position on our part in regard to the desirability, especially at this time, of sales of agricultural commodities on credit, particularly because of the amount of wheat sales involved. Our position in this regard is quite clear. We began the sales of agricultural commodities on credit back in 1955. It is interesting to recall, and I mentioned this the other day without going into the details. At that time the first credit wheat deal was brought before parliament in 1955; an arrangement had been made with the government of Poland. The Conservative leader of the opposition of that day, Mr. Drew, moved the adjournment of the house to call attention to this credit deal with a communist country, Poland. He moved the adjournment of the house to deal with this as a matter of immediate and urgent public concern because, as he said, the negotiations were not yet completed. He went on to say in his motion that if gifts or quasi gifts-he was referring to this credit deal-are to be made to foreign countries they should be made to friendly powers as part of the general strengthening of democracy. This was the stand taken by the leader of the Conservative opposition at that time.
While we may approve of credit deals, as not only necessary and desirable under present circumstances, it is of course clear as I pointed out before that special care should be taken in regard to credit deals with communist countries. There is no better illustration of the necessity for care in these matters than the deal which has been negotiated, the arrangement or whatever you wish to call it, by the wheat board with the communist government of China, to cover the sale of wheat on credit to that country.
The other day in this house, Mr. Chairman, when this matter came up in connection with the conflict going on now between India and communist China, the Prime Minister said it would be undesirable in the circumstances as they existed to break the contract of sale with communist China. After the Prime Minister made that statement the Minister of Agriculture himself, in answer to a question, said there was no contract between the government and communist China-


John George Diefenbaker: No, between the wheat board and communist China; that is where the contract is.


Lester Bowles Pearson: There is, of course, Mr. Chairman, an arrangement, agreement, contract or whatever you wish to call it, between the wheat board and communist China. I should like to emphasize that because the Prime Minister has confirmed the situation. The contract, arrangement or deal is between the wheat board and the communist government of China, which makes it even more surprising that the Minister of Agriculture had to go all the way to Hong Kong to sign some kind of letter after the contract had been signed between the wheat board and communist China.
What we have, of course, is an agreement with communist China in the form-well, we do not know what form it is in; we have not been able to see it. It may be a letter of intent. It was to run, it has been stated-and perhaps the minister will confirm or deny this when he rises to speak-to December, 1963. I have heard the date referred to as December, 1963. This arrangement can of course be broken off, so I am informed-and I think the minister himself has already indicated this-at any time by either party to the agreement. It can be broken off if the Chinese communist government is not in a position to finance further purchases within the agreement; it can be broken off if Canada is not in a position to supply further quantities within the agreement, though fortunately that is not a contingency which is likely to arise. Or perhaps there is some escape clause in the agreement covering war, emergency, or something of that kind. In any event, it is clear that a contract for a specific sale within the agreement has to be made separately in the case of each amount.
We do not know how many of those arrangements have been made. We hear reports in the press that members of the wheat board are now in Hong Kong negotiating at this time, in the present circumstances, further sales within the agreement; further contracts, if you like. These negotiations are now going on, according to the press. Perhaps the minister will have something to say about that when he speaks again in this debate. No doubt if and when these arrangements for additional amounts come to a successful conclusion in Hong Kong and the contract is signed by the representative of the wheat board, the minister will then hurry off to Hong Kong to take some ex post facto part in the arrangement.


Mr. Woolliams:: Mr. Chairman, I wonder if the Leader of the Opposition would permit a question.


Some hon. Members:: Sit down.


Eldon Mattison Woolliams: I would like to ask the Leader of the Opposition whether he or his
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party was against credit sales to China, and is he against them under the circumstances which exist today?


Lester Bowles Pearson: Mr. Chairman, all the hon. member has to do is read Hansard when I talked about this matter the other day. I think the hon. gentleman knows how to read, and if so he can read Hansard of a week ago when I put on the record the statement I made a year ago in regard to these China wheat arrangements. Indeed, before these arrangements were made the position of the Liberal party was on record, at a time when we were criticized by the Conservative party for making our position clear, with regard to selling foodstuffs to Asian countries, irrespective of the form of government in those countries. Perhaps my hon. friend is one of those who criticized us at the time we made our position clear.
The Minister of Agriculture made another proposal in Regina, whether in an official or personal capacity will be cleared up no doubt, in due course. That was that the pools might provide a kind of export agency to assist in the sale of wheat, an objective, of course, which we all support.


Some hon. Members:: Oh, oh.


Lester Bowles Pearson: I said the objective of exporting wheat is one that every hon. member of the house supports, and the minister is not on very difficult grounds when he puts that forward. The minister also put forward the proposal that the pools set up some kind of export agency to facilitate export. Perhaps the minister knows-and if he does not know he should-that the three pools have been studying and examining this possibility for many months now and this is nothing new to them at all. In due course, no doubt, the pools will tell the minister how they feel about a proposal of this kind.


Mr. Jorgenson:: Then why was it ridiculous when it was made, as far as you were concerned?


Lester Bowles Pearson: I have already said, for the Minister of Agriculture to go to Regina in an official capacity and make a personal statement which was repudiated by the Prime Minister the next day is a ridiculous procedure; and so it is. I have already said, and repeated today, for the Minister of Agriculture to make a proposal to the producers of wheat that they share in the risks of credit sales, when they were told six months ago they would not have to share in the risks at all, is also a ridiculous procedure. For the minister to put forward the proposal that the pools set up some export agency, when the pools themselves have been considering this for many months, perhaps is

Supply-Agriculture
not ridiculous but is not one likely to commend itself as a new and impressive proposal to those to whom he was talking.
Mr. Chairman, in recent months and recent weeks, and indeed in recent days, some of the buoyant optimism of the Minister of Agriculture in regard to our prospects for future export sales seems to have disappeared. According to the minister's recent speeches, his outlook on these matters seems somehow to have changed. Perhaps that is because he has had to recognize that the situation today has indeed changed. Across the landscape there is now visible what will probably be one of the biggest of bursting balloons when the present situation is compared with what the minister said would be the situation in this field about six months or so ago.
Only a few months ago, according to the minister and his supporters, everything was wonderful, and we had the minister largely to thank for this. That was the story which was told, particularly to the western farmers. Even when the Minister of Agriculture was appearing on television to say how wonderful things were, even after the election of June 20, at the very time the cabinet was deciding on an emergency program, on surcharges and on the highest cost of money we have ever had in this country.
During the election when these rosy stories were being related to the people of Canada by the minister and his supporters, the minister also said that the $40 million in acreage payments was to be made into a permanent policy, a permanent subsidy. Perhaps when the minister rises to speak he will tell us what has happened to that exciting promise. At that time we on this side of the chamber put forward, in place of an acreage payment as a subsidy, a guaranteed floor price for wheat through a consumer subsidy. When that proposal was put forward the minister saw fit to sneer at it as being quite inadequate; perhaps I can use the word again, as ridiculous. He preferred, so he said, the acreage payment proposal, made on a hit or miss basis according to the exigencies of the political situation at any particular time.
But surely, Mr. Chairman, it would be far better and would have provided far greater security to the producers to have a system of assistance based on long term, sound principles, a system of support prices, of floor prices and, in the case of wheat-as we put forward-a floor price which would be maintained by consumer subsidies. This proposal would have ensured, if it had been carried into effect for the life of the international wheat agreement, that the wheat producers of this country would receive no less than $2 a bushel for their wheat.


Warner Herbert Jorgenson: On what wheat?


Lester Bowles Pearson: That was to be the floor price-


Warner Herbert Jorgenson: On what wheat?


Lester Bowles Pearson: No. 1 northern. The minister knows that. The farmer will know and be able to consider the relative advantages and disadvantages of those two proposals, the government's proposal for acreage payments on a hit or miss basis and our proposal of a guaranteed floor price of $2. And, incidentally, we have put that forward not in a speech by any member of our party in his personal capacity but as official policy. When that policy was announced the minister scoffed at it and misrepresented it in a way which, indeed, made it sound ridiculous because, to quote him, he said "Why, the Leader of the Opposition promises only $2 a bushel for the next three years?" Then again, he said:
The man-
And I was the man.
-promises the western farmers less than they are now getting.


An hon. Member:: That is true.


Lester Bowles Pearson: That was not true at all. That is a complete misrepresentation. The minister should know the difference between a floor price and a market price.
But let that pass. What did the minister say about the market price at that time? On June 16 at Weyburn, Saskatchewan, according to the Leader-Post the hon. gentleman said the price would go to $2.19, that there was almost no chance of the price dropping. He repeated his appeal to the farmers at that time-and it was a very attractive appeal- to grow all the corn they could. We shall sell it, he said.


An hon. Member:: Hear, hear.


Lester Bowles Pearson: I shall come to that in a minute. Well, what is the price now, the price that had no chance of dropping? At the moment I believe it is just under $1.97 and it will be less, if the minister has his way, by the amount of the credit insurance program the farmer would have to pay if that proposal were adopted. Take the price of Durum wheat. During the election campaign it was $2.50 a bushel and the minister again said "Grow all you can; we will sell it." Then on August 1 the price was dropped from $2.50 to $1.50.
Certainly the situation now is not as rosy as the minister used to claim credit for. Perhaps this is one reason for the changed character of the hon. gentleman's recent statements. There are other aspects of agriculture

which are not as rosy as the minister indicated they were. There is the premium on grade A hogs, cut in half since the election, from $3 to $2. Then there is the butter situation. Having talked about this situation at the Ottawa conference this week the minister will no doubt tell the committee what he intends to do about it, as well as about the problems of the dairy industry generally which seem to have aroused a good deal of anxiety in the hon. gentleman's mind-and understandably so, with the amount of butter in the possession of the government now running to about 250 million.
I believe that as of September 29, some 234 million pounds of butter or butter oil was held. The cost for storage of this butter in 1961, for one year alone, was almost $4 million.
This represents a difficult problem, and the minister will no doubt tell us what he intends to do about it. Perhaps he intends to adopt an entirely different approach to this question, because he is reported as having said in Kitchener on May 25, during the election campaign, that subsidized agriculture is on the way out. If so he will no doubt inform the committee by what method he intends to replace the assistance which producers have been getting from what he calls subsidized agriculture. "It is all becoming very difficult now" says the minister. I wonder whether he is still advising producers, as he used to, to "Grow all you can and we will sell it". No longer, now, does he claim the only problem before us is how we are going to fill our orders, as he used to say some months ago.
What has happened? Let us see what the minister himself had to say about it in his Regina speech. On page 4 of the text of that speech he said:
It is clear we are lacing a period of much greater competition for export markets.
Certainly that is true. Then on page 5 he says:
We cannot afford to remain aloof from credit sales without facing up to the economic problems associated with the lower level of exports which would otherwise result.
We on this side have been pointing this out for a long time, emphasizing both the necessity and the risk attached to credit sales; pointing out the danger when too high a proportion of our exports is sold for credit and too low a proportion is sold for cash. Is the minister now aware of this danger attaching to the over-extension of credit and the demand for more and easier credit by some customers on whom we have become more and more dependent? I am thinking, of course, of communist China.
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In regard to wheat-and this has a bearing on what I have been saying-we may at times think too much about the conventional wheat exporters against whom we have to compete, and have been competing for many years, and not enough about those countries which generally produce wheat only for their own consumption but which in recent years have begun to enter world markets as important exporters. The best example of this at the present time is France. This year France is harvesting almost as big a crop of wheat as the big crop we have harvested in Canada, almost 500 million bushels. Too many people think of France as an importer of wheat. Of that 500 million bushels there will be available for export from France 176 million bushels, of which quantity France has already sold a total of 147 million bushels. That is the kind of thing which makes our position difficult, and it is the kind of situation which should be brought to the attention of the producers and exporters, as the minister himself seems now to be doing. On page 6 of his Regina statement the hon. gentleman says:
Selling conditions will be highly competitive in the months ahead and it will require an extraordinarily intensive sales effort to achieve an export level much in excess of 300 million bushels.
And he adds in this speech:
If we don't do that we shall be in trouble.
But what had the minister been saying only a few months earlier? The record is a fantastic one of misleading and exaggerated optimism in the light of what has happened since that day. On December 16, 1961, according to the Leader-Post, the minister said at Radville in Saskatchewan:
I am asking you to produce 500 million bushels a year-150 million for domestic consumption and 350 million for export.
The average production for the last four years, I think, has been about 312 million bushels. Last spring, while the farmers were putting in their crops on the eve of the election campaign, the hon. gentleman was even more cheerful. As reported in the Globe and Mail of April 30, 1962, after referring to a statement released by his department he-
*-urged grain producers to grow every bushel of wheat, oats and barley they can to meet requirements of 1.1 billion bushels this year.
He told them:
Employ every proved technique to conserve moisture and increase your production with complete confidence that there will be hungry markets, good prices and more space available for your grain in country elevators than at any time in the past 10 years.
Would the minister confirm that now as an estimate for the future? On June 6 the

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minister was even more exuberant. At Wey-burn, according to the Regina Leader-Post, he estimated that this year 375 million bushels would be sold. Would the minister confirm that estimate now?


Mr. Hamilton:: Three hundred million?


Lester Bowles Pearson: Three hundred and seventy five million. Then at Wetaskiwin on June 12-we are getting close to the election date- according to the Edmonton Journal he said this, which should be compared to the advice he gave to farmers in Regina a few days ago. The Edmonton Journal reports the minister's statement on June 12 in this way. The heading is "Hamilton says government will sell every bushel", and the report goes on:
We say to the farmers-"You fellows grow wheat and we can sell every bushel of it for you, 600 million bushels if you have it"-
Does the minister still confirm that prediction of sales, "600 million bushels if you have it"? The report continues:
Allegations that the Canadian wheat board had sold wheat to China before he arrived in Hong Kong to conclude the deal were described by Mr. Hamilton as "nonsense"-
Well, Mr. Chairman, those were the statements of the minister in the months preceding the election and during the election campaign, which are to be compared with what he said in Regina the other day and the statements he has made in this house.
Let us see from the figures what progress we are making to fulfil the rosy predictions of the minister that if the farmers produced
600	million bushels the government would sell 600 million bushels. This year we have had a good crop, 558 million bushels compared to 283 million bushels last year. Up to the present, according to the official figures issued a couple of weeks ago, the farmers marketed over 124 million as compared with 86 million for the same period last year. That means that wheat on the farms a couple of weeks ago amounted to some 434 million bushels, compared with 197 million bushels at the same time a year ago. With a visible supply of 361 million bushels, we get a total wheat supply as at the beginning of November of 795 million bushels, compared with
601	million bushels at the same period last year.
The total wheat supply at the end of the crop year was 396 million bushels; that was our carryover. To reach this level during the present crop year we are going to have to sell 194 million bushels more than we did between November 1 and July 31 last year. Since there are only 39 weeks left, that means that we must dispose of an additional 5 million bushels of wheat per week over last year. As there is not likely to be any appreciable change in domestic consumption,

that means that we must export 5 million bushels more per week than we did last year, or roughly three times as much as we did in the week ending October 31. But overseas clearances of wheat in the period August 1-October 31 are running 21 million bushels behind the same period last year. In the light of that fact, I wonder if the minister will confirm his earlier glowing predictions.
Mr. Chairman, there is one other matter I want to deal with. I will not do so in great detail, though it is a matter of such importance to our agriculture, indeed to all our producers, because it is worthy of a separate discussion in this house, and I hope it will soon receive that kind of consideration and discussion. It concerns developments in the European common market, and their possible effect on our agricultural producers. It is quite clear, of course, that whether the United Kingdom becomes a member of the European common market or whether it does not succeed in becoming a member of the European common market, European progress in the field of trade and tariff unification will have an important effect on our agricultural exports. It is surely equally clear that the government should be taking every possible step in every possible way by continuous negotiations at the highest possible level to ensure that these developments will take place with a minimum of damage to our agricultural producers.
Other countries appreciate that point in connection with their own producers. The secretary of agriculture in the United States is over in Europe now taking part in negotiations with the common market, and in Geneva at GATT, and no doubt also at the meetings of O.E.C.D., which I believe is to discuss these matters next week. The meeting of GATT is still going on-it will probably conclude shortly-among officials representing a good many governments at the ministerial level. But Canada is not represented. At the O.E.C.D. meetings we are also to be represented. That meeting will no doubt discuss economic relationships with the European common market and GATT; Canada and the United States, as I say, are to be represented at the O.E.C.D. meeting and will be taking part in these important discussions.
At that meeting we are to be represented not by the Minister of Agriculture, not by the Minister of Trade and Commerce, not by the Minister of Finance, but by the Minister of Justice. Surely nothing could be of greater importance to our economic wellbeing, both now and in the future, than to have Canada take an active and immediate ministerial part in every negotiation now going on or which could be initiated by it, and which concerns these developments in Geneva,

Brussels and Paris. Believe me, Mr. Chairman, in these negotiations between the United States and the European common market, whether the United Kingdom goes into the market or not we will not be given a tree ride through the operation of the most favoured nation clause. If we are going to make these developments work to the advantage, rather than to the damage, of Canada, we should be active in initiating negotiations on our own behalf at the highest political level and at the earliest possible moment.
In so far as the accession of the United Kingdom to the common market is concerned, if we in Canada try to lay down conditions far beyond those which are required for the legitimate protection of our own interests- and we certainly have to protect them-but which are designed to make it more difficult for the United Kingdom to join the common market, we will be taking on a very heavy responsibility indeed. If the impression created in some quarters is of a United Kingdom government fighting to get into the European common market at any price, the impression has also been created in many quarters of a Canadian government fighting to keep the United Kingdom out of the European common market.


Mr. Churchill:: You are completely out of order.


John George Diefenbaker: That is completely false, and the hon. gentleman knows it.


Lester Bowles Pearson: The Prime Minister says that is completely false, and that I know it. Well, I will let the record show how false it is, from the Accra conference right on down to the last comonwealth prime ministers' conference.


Mr. Jones:: Would the Leader of the Opposition permit a question?


Some hon. Members:: Sit down.


Henry Frank Jones: Does he consider that the recent declaration of the United States secretary of agriculture constitutes whimpering in face of the European common market?


Lester Bowles Pearson: I am very glad indeed that the hon. member has brought that up, because it confirms exactly what I have been saying. From the very beginning the United States has shown a sympathetic understanding of the United Kingdom effort to get into the common market. The United States has also passed through congress a trade expansion program which it is using to negotiate with the common market. Having taken this position in principle, and having not whined and objected to these developments from the sidelines, the
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United States has now sent its secretary of agriculture to Europe to negotiate the terms on which the United States can protect its own interests. And what are we doing in that connection?
That is the way in which a wise government would proceed, to having understood the importance of these great developments which are bringing Europe together and which I hope will bring Europe across the Atlantic, and, having created that sympathetic understanding of what is going on, then to fight to protect our own trading interests within the ambit of that understanding. That is the way in which these things should be done, instead of trying to create the impression, at Accra and subsequently, that it is a matter of commonwealth or common market. Believe me, Mr. Chairman, our agricultural producers will not benefit if that alternative is the only one facing them, the commonwealth or the common market with Great Britain going into the common market or Great Britain staying out of the common market.
Moreover, the British are determined that such will not be the alternative, and they have their own producers in mind when they take that position. Mr. George Brown, the deputy leader of the Labour party in the House of Commons, in a debate on this matter had this to say on November 19, and I quote from British Hansard:
If these negotiations failed-
That is the negotiations for United Kingdom entry into the common market.
-they had better take note of the fact that there would be a question mark over the future of the community.
He is talking about the Six when he says "they".
They (the Six) must understand that we do not have to break our pledges to meet the future. It could be met one way or another but going into an enlarged community would be much the better way to meet it.
Then on October 29, the Prime Minister himself, Mr. Macmillan, said this-repeating what he has said many times previously- at the Conservative party conference:
I am persuaded that the commonwealth is complementary and not an alternative to the consolidation of Europe.
And Mr. Butler, his deputy, said at the same conference:
This is emphatically not a choice between the commonwealth and Europe. Our objective is to give Britain greater strength in order to help the commonwealth.
Whatever happens, the results will be important for the agricultural producers of this

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country. Whatever happens, it is not likely that the old system of commonwealth preferences on which we have built up so much of our agricultural production in this country in the past-and we all know that-will be retained intact; whether Great Britain enters the common market or not. Any effort to try to impress on our producers that it is possible to maintain intact commonwealth preferences, whatever happens, is doomed to failure. As Right Hon. Mr. Butler himself said when he was speaking on October 29:
I should say from a whole life's experience in agriculture that there probably is a need for a change in our present system anyway.
We had better accept that fact, especially when it was confirmed by the secretary of state for commonwealth relations, Right Hon. Duncan Sandys, at the same conference, speaking on the same platform, when he said this, and these are words that are important:
Whether we join the common market or not our system of free entry and preferences will in any case have to be reviewed to relate to the altered conditions of today.
It is quite clear, Mr. Chairman, that changes are going to take place whatever happens to the British application to join the common market, that these changes are going to have an effect on the agricultural producers in this country. This government should be adopting policies which will help to adapt our producers to these changes. There are going to be immediate changes, whatever happens; there are going to be immediate difficulties.
However, there will be long range advantages, I am sure, to set against these immediate disadvantages. Surely as a government and as a parliament our main objective should be to do what we can to put into effect the kind of policies which will enable Canada to utilize the long range advantages; to do what we can to ensure that the European common market is built up with the United Kingdom in or with the United Kingdom out, as an outward looking organization with a minimum of obstruction to trade between itself and the outer world. If it is expansionist and if it is outward looking we can gain a great deal for agricultural producers from this development. Otherwise, of course, we shall have trouble.
It seems to me that a very wise stand has been taken in this matter by the Canadian Federation of Agriculture, and I quote from the president of the federation on January 5, 1962, when, in speaking for the federation, Mr. Hannam said this:
The Canadian Federation of Agriculture has always looked upon the development of the European common market as being, in principle, a

policy of statesmanship and wisdom. It has recognized the dangers of the agricultural policies of the Six taking a protectionist turn that could jeopardize our markets in some commodities. But it has believed that the only right lies in fully acknowledging the rightness of the common market concept, and bending our energies through consultation, agreement, and enlightened trade policy on our part, toward turning to our benefit the trade potential which should be opened up by an economically united, prosperous and expanding Europe.
That is the right approach to these developments which are taking place in Europe. That is the approach which will help the agricultural producers and other producers in this country. That is the approach that should be taken by this government. However, it is the approach that up to the present time has not been taken by this government.


Henry Frank Jones: May I ask a further question?


An hon. Member:: Sit down.


Henry Frank Jones: We should like to understand the position taken by the Leader of the Opposition, and if I may do so, I should like to ask him a question. He has indicated that he seems to be in support of the United States stand. Is he advocating that we threaten reprisals on the European common market, as the Americans have done?


Lester Bowles Pearson: No, I am not advocating any such course of reprisals. That course, of course, would not be very sensible. What I am advocating is this. When the United States trade expansion program was being developed, I say that Canada should have associated herself with that program from the beginning so that the kind of approach which is now being made unilaterally by the United States at Geneva and at Brussels on the ministerial level could have been made by Canada and the United States together. Indeed, if Canada had shown any interest in the trade expansion program in Washington at the beginning, the act of congress embodying that program could have been altered to have included important Canadian products in it among those for which the United States would have received power to remove the duty completely. At that time Canada showed no interest in that program. Canada showed a rather standoffish and suspicious attitude at that time. Now when the U.S. secretary of agriculture is over there speaking for his country in these negotiations which are taking place, who is over there speaking for Canada?
I have been talking mostly about western agriculture especially grain production, but of course that is not the only aspect of the agricultural industry which will be considered in the discussion of the estimates. Indeed, other sectors of the agricultural industry are

now, in terms of dollar production value, even more important than grain. An answer was given the other day to a question in the House of Commons, it can be found at page 752 of Hansard, which answer gives some very striking information about the relative importance in the last year, in terms of dollar production and dollar value, of the various segments of the agricultural industry. It shows that the total gross value of grain production in 1961 was $308,792,000. That value, incidentally, in 1961 was less than half the value of grain production in 1960. The total value of fruit and vegetable production was $183 million; that of other field crops, $259 million. But the total gross value of livestock production in this country in 1961 was over $1 billion. The total gross value of dairy products in that year was $567 million and of poultry products $317 million. The total gross value of all agricultural production in 1961 was $2,706 million compared with $2,980 million in the previous year, 1960.
There are other very important aspects of this industry, therefore, which will have to be considered in the discussion of these estimates. My colleagues on this side will be very glad to bring up questions of particular importance to these other segments. Meanwhile we are looking forward to the Minister of Agriculture continuing his statement, which he was not able to complete the other day. Perhaps in that statement he will be able to deal with some of the points I have raised and to reconcile the extravagant, exaggerated, optimistic claims he made during the election campaign, especially about exports of wheat, with the situation confronting us today which he referred to in his speech in Regina where, on an official mission, he gave a personal evaluation of the position.


Mr. Thompson:: Mr. Chairman, in rising to speak in this debate I would preface my remarks by saying that agriculture is still the basic industry of Canada. Tremendous strides have been taken in the production of all types of agricultural produce. If effective markets could be provided both at home and abroad our farmers could then be told to increase their production as much as possible and with the greatest possible speed. From this we understand that the real problem of agriculture today is one of distribution. This is the most urgent and greatest need of the industry.
The Canadian farmer is an individualist. He does not want nor does he look for charity or welfare. He does not want another segment of our economy to bear the responsibility of subsidizing him. All that he asks
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is a chance to sell his products at a reasonable price and with the co-operation of government at the different levels and with his own organizations, in working out his other problems. This does not apply just to the western wheat farmer but also applies to the farmer who grows fruit or potatoes in the maritimes or dairy products or feed grain, whatever it may be, in central Canada.
In dealing with the problems of the farmer I think we can only do so effectively if we look at them from the whole aspect. From my personal knowledge of farmers, no matter in what part of Canada they live, I believe they expect from their national government a policy that is equitable and fair to all regardless of the area of Canada in which they happen to be operating.
The response of the leader of the official opposition to the remarks of the Minister of Agriculture is one which arouses a great deal of interest. It would almost seem that the apparent agricultural spokesman of his party has fallen from grace. I do not even see him present today. However, to be replaced by his own leader must give the hon. member for Assiniboia at least some consolation. I am not sure whether the western farmers will be too convinced, after learning what the Leader of the Opposition has said, that he knows any more about the agricultural problems of the western farmer than he knew before. However, what the leader of the official opposition faced was one of the most questionable policies of the government in the sale of grains, but he went to incredible lengths- he did so the other day and he has done so today-to put on record the fact that not only did the Liberal party support trade on credit with red China but that the idea of communist trade was solely theirs in the first place.
There is even evidence to think that in the interval since his last contribution to this debate he has perhaps changed some of the opinions that he expressed then. He has made a great deal of the speech that the Minister of Agriculture made not too long ago in Saskatchewan. While I do not agree with many of the policies that the Minister of Agriculture has laid down and practised during his years in office, I believe when the records of this government find their way into history no one will be able to accuse the minister of not working and working hard for the farmers of Canada.
The minister asked for the help of the western farmers in carrying the risk of credit selling of agricultural produce, particularly wheat. While I respect the honesty and sincerity with which this request was made, I do not believe it was politically or otherwise

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sound. While we give the minister credit for the fact that his party has the largest minority in this house because of his efforts on behalf of the western farmer, I would caution him that he can lose that support just as quickly by proposing such alternatives to the western farmer who, I am quite convinced, does not feel it is his responsibility to bear the possible loss that may result from default of payments in such sales.
However, I think the request for assistance in the sale of our agricultural products is a good suggestion. The wider you can spread the responsibility of trying to ease our problem of distribution, the better it is for all concerned. I would simply say that this is good provided that any help the U.G.G. or the pools can give in this regard is that of a salesman rather than that of selling agencies. I think this principle applies not only to the western farmer but also to every aspect of our Canadian economy.
It is interesting in this regard that the sale of our agricultural products is, I believe, one of the most important problems facing us today, and I think it is a responsibility of this house of minorities to try together to work out the problem in such a way that we can sell the agricultural products that we produce. What we must comprehend is simply this, that the greatest revolution in the world's history is taking place today, the revolution of humanity against the tyranny of hunger and want. Because this is true, the greatest weapon we have in our hands is the weapon of surplus food, for the lack of which thousands in the world are dying.
There are today approximately one billion children living in the world. On the basis of the statistics supplied through the various agencies of the United Nations and the governments of the world, it is estimated that one half of those children will never reach adulthood simply because they do not have enough to eat to keep body and soul together. Therefore, so far as I am concerned, so far as we are concerned here, so far as the farmers are concerned, so far as those who are concerned with the preservation of world peace and the development of the world's resources for the progress of mankind, the greatest threat before us today is the threat of hunger.
On the converse side of this, the most potent weapon we have in Canada is our food surplus.


Eldon Mattison Woolliams: Will the hon. member permit a question?


Robert Norman Thompson: Yes.


Eldon Mattison Woolliams: One day I heard the hon. member say it is better to be fed than red.

I have also heard him criticize the wheat sales to communist China. Since we are on that subject now, how does he reconcile these two statements?


Robert Norman Thompson: If the hon. member for Bow River will just be patient for a few minutes he will have that answer.
The most important job facing the world today is to feed the hungry. There is no use talking about democracy and free elections to people with empty bellies. They do not ask, when do we vote? The most burning question to them is, when do we eat? Without freedom from hunger there is no freedom. The chief question, therefore, confronting our generation is not how many rockets we can send to the moon, not how we can reduce the cost of death-dealing missiles, but rather whether men can learn to live together on this planet and, in living together, have enough to meet their physical needs. The real issue at hand and the truth of the matter at this time, while we think peace, we talk peace, and we pray for peace, is that we are at war. We are in a war that is called a cold war. It is called a war of ideologies.
However, whatever name we give it, let us remember that this war is a war between two sides. One side says people shall be free and have an opportunity to have their needs met as we in the world can produce and as it is necessary to meet those needs. The other side says that man should serve the state and that man's needs are met as the state controls and dictates. So, whatever our policies are relating to whatever aspects of our economy or government or national life, we might consider that they must be geared to these facts. This is particularly true in the field of agriculture as it relates to the sale of our surplus food products.
I would love to hear the Minister of Agriculture say to the farmers of Canada, produce all you can because as long as there is a hungry mouth in the world we will see that the food is distributed. This is our collective responsibility. Let us remember, as we look at the world situation, that this war is not going to be settled by atomic missiles nor by the brute power of force. It is going to be settled by an economic offensive that is rapidly enveloping us today. The side that comes out the victor is going to be the side that can solve these economic problems in the best way to meet the needs of the hungry of the world.
It is for this reason that I point my finger at the Minister of Agriculture and say his policies, as they relate to the selling of wheat to communist countries, are without effect unless we have an external affairs policy that is integrated with his policies. You cannot have a proper trade policy unless it is

integrated as well. If we cannot have a defence policy that is related to this same picture, then we do not have any hope of winning this war.
It is for this reason I say to the government, unless you bring down a policy that springs from a coherent basic concept of the world's needs in relation to defence problems, to general trade, to agricultural trade, we will never meet our responsibilities in this cold war of which we are a part.
This integrated basic policy is what we need today. It is the type of leadership we expect and demand, not only as members of this house but on behalf of the people of Canada; because the peace and development of our civilization is something about which everyone is concerned. We are concerned with the preservation and extension of the free way of life that we have and which we prize so much in our own country.
Let us face this thing, therefore, for what it is. Behind it there is a moral issue, an issue that rests on the simple foundation of what is right and what is wrong. Two wrongs will never make a right. You cannot neutralize a greater wrong with a lesser one or vice versa. Until we can face these moral issues as we believe them to be, then we cannot succeed. Today part of the world is in slavery and part of it is free. A world so divided cannot exist for very long. Either one or the other must be eliminated. Democracies endeavour to do this by respecting individual rights, the freedom of individuals. The communists do this by denying individual rights and individual freedom. But the hour glass of time runs its relentless course and, as it runs, the difference between these two concepts becomes more acute. The ultimate survival of one will depend on its ability to satisfy the basic needs of mankind.
Let us remember, in relation to the trade offensive that reaches into our democratic nations from the communist countries, that the man behind this whole thing is a man by the name of Mikoyan, the U.S.S.R. first deputy premier. He is the man who directs the Russian economic aid program and the trade agreements which the communists are endeavouring to make with the uncommitted countries in an effort to win their allegiance. As a professional economist he is the front line general of the Russian cold war. On his resourcefulness may depend the final outcome of this, the cold war's decisive front. The weapons he uses are order blanks and unlimited credit.
In the struggle for men's minds the Russians have embarked on a new sales campaign to win converts to communism by offering trade agreements and credits which eastern businessmen cannot resist. We are
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faced with the same thing in our trade relationships today with communist China, as we realize that there has been a threat of war -it is still there-in the Himalayan mountain front of northern India. Let us remember that while this threat is still upon us in all its gravity, we have a Canadian delegation in Hong Kong trading and negotiating. This is the very country that has invaded a commonwealth nation.
Let us remember here also that last year, while we sold our wheat to communist China, communist China was selling its wheat to Russia to pay for the oil that is being used right now to transport Chinese troops across the mountains of Tibet. While we were selling our wheat to China, Russia was selling her wheat to Japan. The only difference was that while we sold it for credit, Russia sold it for cash. These are facts that cannot be denied. However, the trading agencies of the Soviet union, and indirectly those of all communist countries, are responsible to this gentleman who has so recently spent several weeks right in this hemisphere on our doorstep.
A stumbling block in the communist system is that every trade contract becomes a commercial treaty between governments, and in the event that a change is required, it is more involved than a simple commercial contract. Whether or not the Minister of Agriculture says the Canadian government has a contract with the communist government or not, this fact is true. The biggest advantage of the communist system is that trade agreements can be planned with a long range view in mind. Present losses may be balanced against gains in future years. There is the further factor that the communists can gear their economic policies with their political policies in a way that the democracies cannot do. A commercial loss may be compensated for by a political gain, in the bookkeeping of the communist. Therefore we find that while we try to justify the sale of our wheat to communist countries, we are providing a weapon for those communist countries to extend their tyranny to other peoples who are yet free.
I was interested to read the other day, as I am sure every hon. member of this house was, the remarks of a man who lived in China and knows what goes on there. He is no passing journalist; he is not one who passes through on a two weeks' excursion tour. He is a man who has lived there for several years. I am speaking of the ambassador of Denmark to the nation whose capital is Peking. I would like to quote

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what he said as it was reported on November 15 in the Globe and Mail, the dateline being Athens:
"Not a grain of Canadian wheat has ever reached the starving masses of China. If the average Canadian only knew what ruthless purposes Canada's wheat shipments to Peking were serving, I doubt if a single shipment would have been allowed to go through" . ..
According to Mr. Bertelsen, Canada's much advertised grain shipments to China were exclusively used to bolster the communist regime. This the reds shrewdly achieved by distributing the wheat only to the armed forces, factory workers in certain essential industries and-
As he said, to other nations they were trying to influence. Then he said:
"I can assure you that the weary, haggard masses in China have never tasted a grain of Canadian wheat"-
He also said this:
"All of us western ambassadors in Peking made nearly identical reports to our respective governments stressing the consequences of such shipments"-
Coming back to the question of the hon. member from Bow River-


Francis Alvin George Hamilton: Mr. Chairman, I wonder whether the hon. member would permit a question, in the interests of fairness. Would the hon. member read to the committee the statement in that article where the Danish ambassador to Peking stated that he was never allowed out of Peking?


Robert Norman Thompson: I will not take time to read it now.


Some hon. Members:: Oh, oh.


Robert Norman Thompson: But he did say that, except for yearly excursions in which he took part.


An hon. Member:: How did he know about the wheat?


Robert Norman Thompson: The record is there. I am sure he knows a lot more about it than some of us who have never been there, and others who have just passed through for a few days. I do not have that part of the clipping here. From Spokane comes another statement, date-lined the same day:
Canada sells wheat to China because it feels it is selling food to hungry people, not weapons to a hostile nation, a senior Canadian official said here.
The point is not whether we sell wheat to China but whether we are assisting in the extension of the communist world which has threatened to destroy us, and which will destroy us if we do not do something a little more effective than we are doing at the present time. It involves this also, from the other side; that there are millions of people just as hungry as the people of China, and starving in just as large numbers, who are on our side of this struggle and who would

like to continue to be on our side, and who, when they do succumb to the influence of communism, do so only because they have not had their needs met in the system under which they are living.
This is the moral issue that is involved. That is why I believe it is wrong to base our trade policies on this very mistaken impression of what the moral issue actually is. Our stand is not so much that selling wheat to communist China is wrong, if it reduces the number of hungry people. It is a fact that we are losing the battle for those who are still free and we are not fulfilling our obligations to them. It comes down to the fact that we in the western world do not make our economic system function for the benefit of the political scene, as the communists do. The communists can manipulate and work their economy in such a way that it furthers their political ends.
We have not time today to go into the background of this, but this is the basic difference in our approaches to trade. But let us remember this, Mr. Chairman; that behind this very issue is the fact that our economics have often dictated mistaken political philosophies, and until we can solve our economic problems we will never be able to straighten out our political standards.
I would like to quote from a statement by Major C. H. Douglas, the gentleman who first wrote on the principles of Social Credit as he saw the age of automation and abundance coming into being. In the book entitled "Program for the Third World War" published in 1943 he said this:
Now, once you have surrendered to materialism, it is quite true that economics precede politics, and dominate it. It is not in communism, fascism, or in the London school of economics Fabian society, or in a planned economy that we shall find the origins of what we are looking for. These are ostensibly political systems and derive from, rather than give birth to, economics. While this is obvious and axiomatic, it is not so obvious, although equally axiomatic, that the principle works both ways. That is as much as to say. if you can control economics, you can keep the business of getting a living the dominant factor of life, and so keep your control of politics-just that long and no longer.


Arthur Laing: Mr. Chairman, will the hon. member permit a question on this point?


Robert Norman Thompson: Yes, Mr. Chairman, as long as it does not interfere with my time.


Arthur Laing: Would the hon. member make an unequivocal statement that the group he heads does not favour the sale of foodstuffs to red China and other communist countries?


Robert Norman Thompson: The question the hon. member has asked must seemingly give some concern as far as the questioner is concerned. It is very easy to give an answer. As long as there

are hungry people on the free side of this struggle that I am talking about, who need our wheat and cannot get it, we are against the sale of wheat to communist China or any other such country,


Mr. Horner (Acadia):: Mr. Chairman, I wonder if the hon. member would permit a question?


Robert Norman Thompson: As long as it is not using up my time, Mr. Chairman.


John (Jack) Henry Horner: With regard to the remarks of the hon. member about those who are still free, is he suggesting that this government, which has already carried out a program of extensive aid under the Colombo plan, should extend and enlarge this, when the hon. member has stated previously time and again that he is against the subsidization of agriculture? Would not this be, in a sense, subsidizing agriculture further if we gave wheat to those people who are still free?


Robert Norman Thompson: I will deal with this question in just a few minutes, Mr. Chairman. I would just like to say to the hon. member for Acadia that the only basis for the survival of our agricultural industry, including the family farm, is the setting up of a two price system that will allow us to export our surplus products. Unless we can do that we had better close up shop. This does not mean subsidies in the sense that we understand a subsidies program such as they have in the United States and which, whether we like it or not, is developing in our own midst. This two price system must be there to guarantee our farmers an equitable price to cover their cost of operation and to let us get our food products out to those people who do need them on the other side of the fence.
On the positive side, Mr. Chairman, I would like to say this to the Minister of Agriculture. Canda's long term policy must be to take action that will reduce, and not increase, world tension. This is not the whole responsibility of the minister, but it is his responsibility to the extent that he is the minister who lays down the agricultural trade policies that govern our struggle in this cold war. In all cases where totalitarian governments are involved we have no quarrel with the people who are the subjects of those governments, whether they be in China, Russia or any other place. Rather we sympathize with their position. We are opposed, however, to the extension of this type of government and policies which aid this type of government. We therefore believe that the proper test in connection with trade with all countries under a totalitarian form of government is "Does this trade give help
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to the people of the country, or does it further the aggressive designs of their government?" We cannot permit trade which helps fasten tyranny on other people, yet we must realize that refusal to trade in certain circumstances may lead to yet closer alignment of government with the communist powers, and considerable distress and weakening of the economic position of the people of the country anxious to secure independence from their government.
In connection with communist China, this means we are not opposed to selling wheat to communist China as such. The opposition we have shown to this sale, which we made plain in the election campaign and stand by at this time, is that this grain did not go to feed the hungry people of China. It was unscrupulously used by the communist government of that country for export to countries such as East Germany and Albania where the government of communist China was endeavouring to obtain political influence. We cannot believe that a country such as our own, believing in freedom, has the right to profit from trade that helps the cause of tyranny in this manner.
We also feel that, partly for humanitarian reasons and partly for strategic purposes in the cold war, Canadian exports of foodstuffs and other raw materials should primarily be directed to countries not under communist control, and only when the needs of these countries have been reasonably satisfied should surpluses be exported to communist countries. We strongly believe it is possible to work out practical trade arrangements with countries not under communist rule that will be beneficial both to them and to us and not leave Canada open to the charge of supporting her enemies while allowing her friends to go hungry.
This is a reasonable approach and one which will bear thinking about. Let us take a practical example. There are 450 million people in India. These people have a calorie intake of approximately only 1800 calories a day. There are hundreds of thousands of people who starve to death there each year. I know I have seen them die from starvation, and one does not forget such things. If we were to ship to India a bushel of wheat per head per year-450 million bushels of wheat- what would it represent? It would be 60 pounds of wheat per person, or approximately a loaf of bread a week. That is all. This does not only apply to India. It applies also to Pakistan, where the calorie intake on an average is only 1,810 calories per person a day. What about the countries in Latin America? What about the threat to communism in our own hemisphere? Is it not possible to work out trade problems and

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extend trade credit arrangements in a better way than we are doing now? This is a question which I believe the Minister of Agriculture and the government must consider.
I believe it is wrong for us to take an isolationist stand with regard to the organization of American states. Here again an integrated policy must come into play. If we were playing our part in the organization of American states, which we all agree has greater economic potential than NATO has, we could go ahead and meet our needs as well as-


The Deputy Chairman:: I am sorry to interrupt the hon. member, but his time has expired.


Francis Alvin George Hamilton: On behalf of this party I should like to give the leader of the Social Credit party the opportunity to finish his statement.


John Whitney Pickersgill: And I, on behalf of this party.


Robert Norman Thompson: Thank you. In making this statement I am not trying to be destructive; I am not trying to spend hours of our time seeking to juggle the past record or confuse the issue which is before us now in the light of the past record. We are seeking to make a constructive contribution to the problem of trade as it relates to our agricultural industry.
I would say this also; that in meeting the problem of trading agreements which will provide for the distribution of our agricultural surpluses the time has come, imperatively so, when we should endeavour somehow to create an effective international settlements organization. I realize this is not the responsibility of the Minister of Agriculture, but it is the responsibility of the government.
Such action is necessary because the real difficulty in selling our agricultural products involves the settlement of obligations and the question of international trade agreements on a world scale. Until we can solve this problem of international settlements we shall be obliged to follow the very strategy which the other side in the cold war is seeking to force on us.
The world bank and the Bretton Woods agreement are failing to supply an effective system to facilitate world trade today. In 1945 the members of our group in this house took a strong stand on this and similar questions for reasons which we now see, in the light of subsequent events, to have been thoroughly justified. This is why I am confident we must move ahead in an effort to resolve this question of international payments in a long range manner rather than in

accordance with the expediencies of the hour. It is our responsibility, in this house of minorities, to do so; and the responsibility, specifically, of the government of the day.


John (Jack) Henry Horner: Would the hon.
member permit a question? He is now on the subject of the financing and marketing of agricultural products. I wonder if he would tell the committee whether he is in favour of deficit financing.


Robert Norman Thompson: The hon. member for
Acadia does not understand the requirements which enter the financial picture if we are to be able to solve this problem. If he is speaking of deficit financing as we think of it now, I say that deficit financing is the only answer. But is there any reason why a financial system which was thought out by our forefathers to meet the needs of their day should not be changed in order to meet the needs of our day? If we had a war we would settle it in a hurry.


Mr. Fisher:: Debt free money.


Robert Norman Thompson: Yes, the hon. member
across the way is right. It does mean debt free money for the use of a two price system.


Douglas Mason Fisher: I hope the hon. member will not take exception to my remark. I was trying to call for applause for the hon. member for Bonavista-Twillingate.


Mr. Bradley:: I also have a question-


Rémi Paul: Order. The hon. member has received permission to complete his remarks, and I think it would be better if further questions were not put to him.


Robert Norman Thompson: Thank you, Mr. Chairman. I do not intend now to discuss in any detail how we recommend that the problem of international settlement should be met. Time does not permit, and there will be other opportunities to discuss it. I would say this, however; that if there was a hot war tomorrow we could export, without any selling price at all, billions upon billions worth of arms and never expect to be paid for them. Why can't we do that in time of peace? The committee may remember that when the last war was over we cancelled a billion dollars worth of debt owed by Great Britain, most of it on account of food supplied during the war, and nobody batted an eyelash about it. The need is just as urgent today.
I should like to say one thing more with regard to markets. The greatest market we have for our agricultural products is the Canadian market itself. As we consider the question of the international sale of our agricultural surpluses, let us make sure that we meet the needs of our own people as

well. It is time we made sure that our home market was satisfied, and I am thinking of areas of eastern Canada which were not blessed with the grain harvest they had in the west this year. They need it and should be able to take advantage of it as well.
It is time to make sure that our emergency measures organization includes stockpiles of food for every centre of the population should the catastrophe of war occur, and we all hope it will not.
However, we must not forget the need for the adequate trading agreements. The only way in which the world can go forward in the development of its resources, both material and human, is on the basis of the freest possible exchange of goods. That must mean a lowering, and in many cases the elimination, of various trade barriers. Again time does not permit to go into the details of this, but herein lies the approach we must take, and in this approach lies the solution to our problems. Canada and Canadians are waiting for leadership from this house which will work out a satisfactory solution to these problems before we are engrossed in a struggle with the direct threat of the take-over and the other side of this ideological war about which we have been talking.
So in closing-and I do appreciate the consideration of the members of this committee in letting me have a little extra time-I would say that it is all right to stand up and criticize the Minister of Agriculture, or to try to lay the blame at somebody else's doorstep. The fact remains that we ourselves will have to work out the solution. We in this corner of the house pledge our full co-operation in doing so. Only if we do this collectively can we face up to our responsibilities today in a world situation which, on the one hand, offers the greatest opportunity for development that civilization has ever known but, on the other hand, threatens us with the greatest period of dark ages that we can think of or which has ever been experienced. So let us, as we go on into this question, consider it constructively, not destructively, in order that we can fulfil our responsibilities.


John Whitney Pickersgill: Would the hon. member for Red Deer permit me under the rules to take exception to what I think was an inadvertent misstatement of fact? He said that the hon. member for Assiniboia was away from the house at the request or at the instance of the leader of the Liberal party. I may say that the hon. member for Assiniboia left this house yesterday with the assurance that an entirely different order of business was going to be up for consideration today. I am not
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accusing anyone of having changed the order of business because the hon. gentleman was away, but that is the fact.


Robert Norman Thompson: Mr. Chairman, may I say to the hon. gentleman for Bonavista-Twillingate that he should not put words into my mouth, because that is not what I said and it will not be found on the record. I merely noted that the hon. member for Assiniboia was absent today, and I did not attribute the reason for his absence to the leader of his party at all. The record will show that.


John Whitney Pickersgill: Well, I will leave it to Hansard.


Mr. Douglas:: Mr. Chairman, I will not get into the dispute between the hon. member for Bonavista-Twillingate and the leader of the Social Credit party regarding the absence of the hon. member for Assiniboia. It is probably quite within the usual procedure to have the leader of the Liberal party deal with agricultural matters on behalf of his party, and I am sure that the hon. member for Assiniboia is not here for reasons best known to himself. He has always been very considerate of his political leaders.
Because of the limited time at my disposal I propose to confine myself to discussing the question of wheat marketing and the statements which were made by the Minister of Agriculture when he addressed the annual meeting of the Saskatchewan wheat pool on November 9. I would hope that at some later stage of our discussion of the agriculture estimates I might be able to discuss the wider field of agriculture and some of the questions of trade which have been raised this morning.
In opening the discussion of these estimates the other day, and in defending the statements which he made to the annual meeting of the Saskatchewan wheat pool, the Minister of Agriculture did me the great honour of saying that my criticism of his statements demonstrated that I did not know anything about the operations of the wheat board. This may be true. I do not claim omniscience, as do some gentlemen who sit on the treasury benches, but I do want to say to the Minister of Agriculture that I was fighting in this house for the wheat board and for an orderly marketing system when the Minister of Agriculture was not quite sure as to the difference between May wheat and Mae West.


Francis Alvin George Hamilton: That is absolutely false in every detail.


Thomas Clement (Tommy) Douglas: I took exception, in the first place, to the fact that the minister should make what I consider to be two important statements on public policy before a meeting of the Saskatchewan wheat pool before any

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statement had been made in this house or any opportunity given to any hon. members of this house to discuss it. I think any consideration which is so important that it affects the orderly marketing of wheat ought to be debated by the members of this house before a proposal is put forward which can only have the effect, as it has, of disturbing a great many farmers and, as I shall show, of disturbing the leaders of the various farm organizations.
The minister kept referring to the sentence in his speech which said:
I want to put forward a series of proposals which are in my mind-
The Prime Minister, in discussing this matter, also kept reiterating the phrase "which are in my mind". But I go on to finish the sentence:
-in the hope that there will be public discussion during the winter on these matters.
Surely a statement which is to have public discussion and a text which was distributed by the minister's own department could not be something which was merely in his mind. The minister defends himself on the ground that this was consultation with the farmers. No one objects to consultation with farm groups, but I do want to ask, first of all, why not begin by discussing this matter with the advisory committee of the wheat board?


An hon. Member:: One o'clock.


John Whitney Pickersgill: Mr. Chairman, before you leave the chair I wonder if I might suggest that there be unanimous agreement that the hon. member for Burnaby-Coquitlam be given the same latitude that was given to the hon. member for Red Deer. I believe the Minister of Agriculture intended that.


Warner Herbert Jorgenson: It has already been done.


John Whitney Pickersgill: I do not think there was unanimous consent.


Rémi Paul: Is it agreed?


Some hon. Members:: Agreed.
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2.30 p.m.
Thomas Clement (Tommy) Douglas: During the luncheon recess some of the members asked what was the difference between May wheat and Mae West. I am told on very good authority that the only way in which to find out is to accept the famous invitation "Come up and see me some time".

When we adjourned for luncheon I was dealing with the propriety of the minister making before the annual meeting of the Saskatchewan wheat pool two extremely important proposals which had not been discussed in parliament. In defending his action he asked if I did not believe in consultation. Of course, anyone who has had anything to do with government knows that consultation is the very essence of good legislation. Certainly consultation with the advisory committee of the wheat board should have been done and perhaps was done. I hope the minister will tell us. Consultation with the executives of the various farm and wheat pool organizations would have been advisable.
However, the statements made by the minister were not in that category. It was not, as the Prime Minister suggested the other day, just a small meeting of farmers. This was the annual meeting of the Saskatchewan wheat pool before which annually provincial and federal ministers have come to announce policy decisions. Far from being a private meeting, copies of this speech were distributed to the press. I would suggest that a statement of that kind becomes a statement of policy by the government. If it is not, then it is extremely difficult for farmers and for farm organizations to know when the Minister of Agriculture is speaking in his private capacity and when he is speaking in his official capacity.
On the surface the two proposals made by the Minister of Agriculture may seem to be fairly innocuous and even reasonable. However, they have implications which I think ought to be carefully examined. The farm organizations have spent the last 40 years battling to establish an orderly system of marketing wheat and coarse grains. This has been a long and difficult battle; the story of orderly marketing has a checkered career. The first wheat board was set up during the first world war. It was set up, I would remind the committee, not to keep prices up but rather to keep prices down. When the war was over the marketing of wheat was restored to the private grain trade and to the grain exchange with very disastrous results. The producers tried to protect themselves in the late 1920's by setting up their own central selling agency but without government backing this agency met some very serious reverses.
In the 1930's the demand for orderly marketing and for a wheat board to market grain became extremely vocal. Credit goes to the Conservative government under Right Hon. R. B. Bennett for setting up the wheat board in 1935, just as they were going out of office. It will be remembered that the first thing which the Liberal government did when they

came into office was to pass an order in council saying that wheat would not be handled by the wheat board as long as the price stayed above 90 cents a bushel. From this time until the beginning of the war wheat was handled mainly through the private grain trade. Again during the second world war the wheat board was made operative for the purpose of keeping the price down, not for the purpose of keeping it up. After the war public opinion in agricultural communities and indeed in all of western Canada was so clearly in favour of having orderly marketing and a national wheat board that it was impossible for any government to go back to handling wheat through the grain exchange. Hence we have had the wheat board ever since then.
The farmers have fought long and hard in order to get this type of orderly marketing and they have benefited from it. I take nothing away from the present Minister of Agriculture or the present government in saying that credit sales and increased sales have helped the farmers and that because of orderly marketing there have come to the farmers final payments which otherwise would have gone to the speculators. This is not just to the credit of the government. It is to the credit of all who through the years have fought for the establishment of an orderly system of marketing.
Now that we have such a system I suggest that we would do well to examine these two proposals of the minister with a view to seeing what their effect would be upon the scope and function of the Canadian wheat board as it is at present constituted. The first proposal made by the minister was that a final wheat payment could be used to build up a fund to share in any losses suffered through default on wheat credit sales abroad. I think perhaps I had better quote directly from the text of the minister's speech in which, at page 6, we find the following:
Specifically, I wish your organization at all levels to consider and discuss in a fully objective manner the possibility of "setting aside" a portion of the final wheat payment with a view to building up a fund which would be used in sharing in any loss which may occur, should there be a non-payment or default from a customer purchasing on a credit basis.
First of all, Mr. Chairman, I want to ask this question. Why has this matter been raised at this particular time? No indication has come from any quarter to indicate that those nations which have been purchasing wheat on the credit basis are delinquent or are immediately likely to become delinquent. Why then are the farmers being asked to share any risk which may be involved? The minister
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himself gave the reasons and I think they should be noted. He said, as found on page 6 of his address:
It was not an easy or simple matter to attain approval for these credit levels and I must advise you that it will become infinitely more difficult to obtain approval for higher levels, particularly when members of two opposition parties oppose these sales.
The minister did not say which parties they were and I leave it to him to corroborate his statement. Certainly this party is not one of them. But I ask, Mr. Chairman, was this a suggestion by the minister? Certainly it was not a suggestion. It was a clearcut statement that the minister did not find it easy to get his colleagues to agree to guarantees for these credit sales and that he would find it infinitely more difficult to get any further guarantees for credit sales. It is clear, therefore, that the reason this proposal was being put forth by the Minister of Agriculture was the reluctance on the part of his own colleagues to assume further responsibilities for large credits to enable the sale of wheat to overseas customers who are unable to pay cash. As a matter of fact, in the same paragraph the minister went on to say:
-it will make my task so much easier if I am able to say to my colleagues that farmers are willing to consider sharing the risk of credit sales.
I want to point out that this is a far cry from the speeches that were being made by the Minister of Agriculture and his colleagues on the prairies during the last federal election campaign when they were saying to the farmers: The wheat board sold the wheat but we put up the money. It is a far cry from their speeches in which they were saying to the farmers: The government has guaranteed these credit sales and you will get your money. If these creditor nations fail to pay it will be the government that will take the loss. The farmers will not lose a cent.
But now we have a totally different story. Now we are being told that the cabinet are reluctant and, as the minister said, it will be infinitely more difficult to get them to underwrite further credit sales. I want to ask the question: Why should the cabinet hesitate about extending the level of credits for the sale of wheat? Guarantees to date amount to $190 million. Why should we consider that the ceiling? This is a comparatively small amount, as I shall show in a few moments, compared with what other countries which are exporters of wheat are doing.
It is true, as the minister pointed out, that under the Export Credits Insurance Act private exporters have guarantees of 85 per cent and they must carry 15 per cent of the risk themselves; but I would point out that

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this is on the basis of sales which they themselves have negotiated. I think that the farmer is quite justified in saying that when the government has negotiated the sale and when the government, which is in a position to know, decides that this is a reasonably good risk, the government should be prepared to carry the risk. Certainly that view is shared by the farm leaders. I would point to the statement which was made by Mr. Rudy Usick, president of the Manitoba farmers union, who said:
Mr. Hamilton has promised to sell all the wheat the farmers could produce and it is not up to the farmers to bail him out when he gets in trouble.
Mr. W. J. Parker, president of the Manitoba pool elevators, said:
The farmers should not be asked to assume losses incurred by government policies.
I know of no reason why the government, on behalf of the agricultural population of western Canada, should not be prepared to assume any risks which may be involved. It seems to me that the government has a strange sense of priorities when it comes to dealing with the farmers. They have talked for years about a food bank. Yet I understand that Canada's contribution to the $100 million food bank is going to be a mere $5 million. Under the austerity program, which we are told does not exist, some $8 million has been cut from the paltry contribution we make under the Colombo plan. Now the government apparently is going to ask the farmers to underwrite the risk on credit sales, although no losses have been reported and so far we are told that no losses are anticipated.


An hon. Member:: What are you worried about?


Thomas Clement (Tommy) Douglas: One member asks me what I am worried about. I will tell him what I am worried about. I am worried about the farmers being asked to underwrite risks over which they have no control and being asked to underwrite the guesses of somebody else. That is what I am worried about.
Each year the government spends about $1,700 million on defence, and while I do not agree with the leader of the Social Credit party, who seemed this morning to have adopted Haushoffer's idea that food should become one of the weapons of war and that you starve people into submission-


Robert Norman Thompson: Who said that?


Thomas Clement (Tommy) Douglas: That was the impression I certainly got from the hon. member. I do agree, however, that food is one of the weapons in the arsenal of democracy by which we can win for ourselves and for the cause in which we believe a great deal of

good will. We would do well to spend more money helping to feed the underprivileged and underdeveloped peoples of the world. This in the long run would do more to contribute toward peace than probably any other single thing we could do.
I would point out that the United States has gone much further than Canada has in promoting wheat sales abroad by means of government aid. This morning the Leader of the Opposition said that we had to question whether or not too much of the sale of our wheat was being carried out on the basis of credit sales as related to cash sales. Everybody knows that we would always prefer to make sales for cash but I should like to point out that in the 1960-61 crop year United States exports of wheat and flour totalled 660 million bushels and that almost 70 per cent of that was disposed of by other than cash terms. In contrast, Canada's credit sales represented a relatively small fraction of our total sales. Both the Australian and French governments have concluded major agreements to sell wheat to China on much more favourable terms than those allowed by Canada. This suggests that the Canadian government has not even come close to reaching the maximum level of guarantees for export credits which it could properly make in respect of wheat sales abroad.


John (Jack) Henry Horner: What are you worrying about the risk for?


Thomas Clement (Tommy) Douglas: The hon. member seems to want to keep interrupting. I suggest he will have an excellent opportunity to stand up before this debate is concluded and tell this committee and the farmers of western Canada whether or not he favours the proposal of the Minister of Agriculture.


John (Jack) Henry Horner: I certainly do, and I am going to go back and tell them so.


Thomas Clement (Tommy) Douglas: Perhaps the hon. member will repudiate it like the Prime Minister did.


John (Jack) Henry Horner: I thought I made myself quite clear in saying I will support them and will take part in the debate.


Mr. Peters:: You will support both sides.


Thomas Clement (Tommy) Douglas: The hon. member will support one here and another one in the country.
What is disturbing to those of us who believe in and have fought for an orderly marketing system is that this could be the camel's nose in the tent. This could be the beginning of something that will go much further. In the minister's speech to the wheat pool delegates, he said, "I have no exact share in mind." We have a right to know what share the minister has in mind. Are the

farmers, bit by bit, going to be saddled with more and more of the insurance risk? Is the responsibility for underwriting overseas wheat credits gradually going to be shifted from the government to the farmers? This is what we want to know. If we are going to sell wheat, then credit sales are going to become an increasingly important factor. I am told, and the minister can tell us more as the committee proceeds, that under the agreement with communist China the latter has now taken sufficient wheat to have passed the minimum and she does not have to take any more. She can take more, but is not required to do so. This may mean negotiations for any further wheat sales. As I have already mentioned France, Australia and the United States are already offering very favourable terms. If credit sales are going to be an increasingly important factor in the sale of wheat to overseas customers, then the farmers are justified in wanting to know whether this is only the thin end of the wedge; whether or not step by step the whole burden is going to be passed over to them.
The second proposal made by the minister is contained on page 7 of his manuscript. I quote:
I am now going to put forward a second major suggestion for serious consideration and discussion. Will the three western pools, and the United Grain Growers, acting co-operatively, consider forming a grain sales organization to enter aggressively, first the domestic market and secondly, at a later stage, the export market as a real selling agent of the Canadian wheat board?
I would say that this proposal implies that the wheat board has not been doing an effective job in selling wheat and that an additional agency might be helpful. My own opinion is that the Canadian wheat board has been doing an admirable job and has functioned quite well as a selling agency. If the minister feels that the farm organizations could make a contribution, then of course he could give them greater representation by adding their representatives to the wheat board. The pool organizations already have export departments. These, of course, could be enlarged. But when the minister says the farmers want to be independent, I should like to tell him they want to be independent but they do not want to be deserted. They do not want to have this responsibility transferred from the wheat board to the farmers.
We should never lose sight of the fact that nearly the entire world wheat trade today is now conducted on the basis of what might be called state trading. Under present day conditions, governments mainly deal with governments. For those customers who are not able to pay, insurance arrangements have been worked out between the various nations to
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sell for credit, in some cases to accept foreign exchange and in other cases by straight barter exchange. In such a situation I believe that only the government can effectively handle the overseas selling of wheat. The experience of the central selling agency in the thirties showed the limitation of a producer group if it lacked government backing in being able to operate successfully. It would be worse than useless to expect that any producer selling agency to be able to compete abroad for wheat sales with the national treasury of the United States, France or Australia.
I said the other day, in my opinion, these proposals represent a devious undermining of the scope, functions and responsibilities of the wheat board as presently constituted. The minister said that this statement was entirely false. Well, I point out that the leaders of the three farm unions of Canada, Alberta, Manitoba and Saskatchewan, have expressed concern and opposition; that the secretary manager of the Manitoba Federation of Agriculture has said the same thing, and that the president of the Manitoba pool has expressed disagreement.
Why are these people concerned? They are concerned because these two proposals do not seem to be completely unrelated. The wheat board has told us, through their annual report, that more and more of their sales are being handled by their agents and less directly by the wheat board itself. I was rather interested in noticing the other day that the minister said the wheat board is not mainly responsible for selling. Well, this was not the story that government members were telling on the hustings last May and June. They were saying, we have sold wheat; we have put up guarantees. Now, they are saying, we want you to start taking the risks; we want you to start assuming the responsibility for selling.


Mr. McIntosh:: That is nonsense.


Thomas Clement (Tommy) Douglas: The hon. member for Swift Current-Maple Creek thinks it is nonsense. He has a chance to tell the people what he thinks. He can take part in this debate, but he will probably keep out of it; I know what his job has been. It has been simply to vote the way he is told and keep quiet the rest of the time.
If the wheat board is going to divest itself in increasing measure of responsibility for selling, and if the government is going to divest itself increasingly of responsibility for guaranteeing credit sales, what will be the result? The result will be that a producers organization, unless it has the support of the Canadian treasury, will find itself carrying major risks and this could be the beginning of

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a return to the private grain trade and to the old grain exchange speculative market. Let us make no mistake about that. Mr. Chairman, I say that I am suspicious of these two proposals.


An hon. Member:: Too suspicious.


Mr, Douglas:: Someone says, "Too suspicious". I would like to tell hon. members sitting on the government side that I have good reason to be suspicious. When I see what this government has done to the Canadian Broadcasting Corporation, which they have undermined in the interests of the private broadcasting network; when I see what they have done to the T.C.A., which they sabotaged in the interests of Canadian Pacific Airlines; when I see what they have been doing to the Canadian National Railways-


Some hon. Members:: Order.


Mr. Ricard:: Keep in order.


Thomas Clement (Tommy) Douglas: -where it has transpired in the last few days that when a potash mine is opened in Saskatchewan and the Canadian National Railways is quite capable-


The Chairman:: Order. I do not like to interrupt the hon. member, but we are on the first item of agriculture, which allows a very broad scope on that subject but not on other subjects.


Thomas Clement (Tommy) Douglas: Mr. Chairman, with all deference I suggest that I am simply illustrating that a government which could sabotage the C.B.C., T.C.A. and the C.N.R. is equally capable of sabotaging the Canadian wheat board. I am saying that when Canadian National Railways was quite able to handle all the potash, had the cars, had the arrangements made, Conservative members supported the C.P.R. in building a parallel line which was constructed before they even came to this parliament, and they did this by giving their support to the passage of a private bill to give the railway authority to construct a line.


An hon. Member:: Did you vote against it?


Thomas Clement (Tommy) Douglas: I certainly did vote against it; I opposed it in this house. I opposed that bill on second reading, as anyone who looks at the record will know. Also, I would point out that when the bill was before the committee our members took very serious exception to duplicating this line and said there was no reason why Canadian National Railways should not have been given an opportunity to demonstrate whether or not it could handle this traffic. The petitioners were so anxious that they had the line started before they even brought the legislation into the house.

This is why farm leaders in western Canada are apprehensive of the proposals put before them by the minister; not just because of the two proposals in themselves, but because they have dangerous undertones and dangerous implications for the continued operation of the wheat board and for the maintenance of an orderly marketing system in the handling of wheat. As a matter of fact, the very first step toward undermining the wheat board was taken by this government last year when they took feed grains out from under the wheat board and returned these to the private trade.


An hon. Member:: You had better stick to medical care.


Thomas Clement (Tommy) Douglas: Mr. Chairman, I will tell my hon. friend who made that interjection that any Tory party representative who goes out through western Canada and tries to sell these two proposals to the prairie farmer will need psychiatric care, never mind medical care. I am suggesting that the time has come, not for the government to give less support to the processes of orderly marketing but to give more support.
The wheat situation is not as rosy as government supporters have been trying to tell the public over the last year. The recent report shows that wheat stocks, by the government's own statement, now amount to about 953 million bushels. This, if I remember correctly, is about the third highest in our record. The estimate is that they will sell, between export and consumption in Canada, some 470 million bushels; that amount will be disposed of in this crop year. This will leave us by July 31, 1963 with about 480 million bushels. If we have a better than average crop next summer, this means we will have a larger carryover next year than we have at the present time.
With the levies that are being imposed by the European common market, added to the fact that the United States today has about two billion bushels of wheat in stock, that Europe has good crops and that both France and Australia are pushing into the world export market by extending very favourable credit terms, this means that Canada is going to have to sell wheat on the basis of state trading. It is going to have to underwrite more, and not less, sales. This is a responsibility which belongs to the government and the government cannot divest itself of that responsibility. For the government to endeavour to throw back upon the wheat producers responsibilities which are properly those of the government is something which

I believe will be resisted by the wheat growers of western Canada, and I can assure the government it will be resisted by the members of this party.


Francis Alvin George Hamilton: Mr. Chairman, first of all let me say that I am sorry you could not hear all the remarks that were passed at this end of the chamber. I think that possibly, if they all appeared on the record, it would be one of the funniest periods in this house since I have been here. I laughed when I heard the hon. member for Burnaby-Coquit-lam speak about Mae West. He is an expert on this type of subject. But I come from Saskatchewan and I have heard him say the same thing for 30 years. To me it is the same old, well worn gramophone record that he plays every time he gets up to speak. This gramophone record is getting pretty monotonous in Saskatchewan.
I know at least two good reasons why his statement is wrong. One is this: while he was preaching in another arena I was attending meetings of western Conservatives in the early 1930's that eventually led not only to the formation of the Canadian wheat board in 1935, but also in no small measure to the farm loan act amendments, the farmers' credit re-arrangement act amendments, the Natural Products Marketing Act and a whole series of legislation aimed at helping farmers all across this country. He came into the picture in 1935 at the time when Mae West was at her peak. Now he gets up in the house and says it was improper for me to consult with my own constituents before I consult with hon. members here in Ottawa. I suppose he defines my constituents as being delegates of the Saskatchewan wheat pool. He says it is not right for me to consult with them first. I suggest to him that if he had consulted with the people of Saskatchewan before he tried to ram that medicare scheme on them, he would not have had to leave Saskatchewan.
Then the hon. gentleman goes on to raise the bogeyman that this government which, after years of tribulation, established the Canadian wheat board and is now trying to tear it down. I am not going to deal point by point with everything the hon. member for Burnaby-Coquitlam has said, because he demonstrated again in this house today that he knows so much less about the marketing of grain than the majority of our Conservative backbenchers that I shall leave him to take his chance with them. For example, he said he thought this government should do more. Does he not remember that the first thing the government did this session was to 27507-3-124
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double the funds available to back the Export Credits Insurance Act, from $200 million to $400 million?


Thomas Clement (Tommy) Douglas: What has that got to do with
it?


Francis Alvin George Hamilton: There you have a perfect example of the knowledge of the New Democratic party. Under section 21 of the Export Credits Insurance Act, some $170 million are committed today. Of that sum, approximately $90 million is for wheat. That is what it has to do with it.


Thomas Clement (Tommy) Douglas: Could I ask the minister why the other $100 million did not come under the same section?


Francis Alvin George Hamilton: The hon. member for Burnaby-Coquitlam is a glutton for punishment. That is exactly what I was trying to do in western Canada two weeks ago-call attention to the fact that new opportunities exist, opportunities about which the hon. member apparently knows nothing and cares nothing. All he is interested in doing, to judge from his remarks today, is to make sure that the farmers of western Canada have no chance of forming a selling agency so that those who produce the wheat should have a chance to get some of the profits on its sale.


Thomas Clement (Tommy) Douglas: They have that right now.


Francis Alvin George Hamilton: They , have that right now. After a lifetime of regaling us, in Saskatchewan in particular, about the evil of monopoly interests and the threat of these giant corporations which have so much say in controlling the movement of goods in world markets, the hon. member now says we must not let farmers form a sales organization to get into this field because it is one which should be reserved for those friends of his, the great international grain companies. That is what, in effect, he is saying-though he does not know what he is saying; that is the kindest thing one can say of him.
But I did not rise to castigate the physical giant from Burnaby-Coquitlam. I will let him take his chance with the backbenchers. My remarks on this occasion will be on other subjects. It is not usual for a minister bringing down his estimates, particularly an earthy, simple type like the Minister of Agriculture, to have such attention paid to him by the leaders of three parties. I could not altogether understand why the leader of the Liberal party should have got into this. I thought perhaps he was sensitive about the fact that when he made that long oration of his during the debate on the address he omitted to say anything at all about agriculture, and had to make up for it somehow. Then it

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occurred to me that the second reason why he wished to speak on this subject was because someone had advised him-I do not know who-that it might be wise for him to attack the Minister of Agriculture so that all the credit would not go to the party called the New Democratic party. I do not know who advised the hon. gentleman. I know that in the days when the hon. member for Essex East advised him he had a good adviser. Although that hon. member knew nothing about agriculture, he had his own bureau of statistics and any advice he gave to the Leader of the Opposition at least did not get the hon. gentleman into trouble. But the hon. member for Algoma East now has a new adviser, and this adviser has a remarkable record of being wrong. Whenever an issue comes up in agriculture, 90 per cent of the time the hon. member for Assiniboia goes the wrong way, and any person who observes someone going the wrong way over and over again generally goes the other way as a matter of common sense, if he has any judgment.
When I made those remarks in Regina, the hon. member for Assiniboia rushed immediately into print and, in phrases which usually can be found only in the Leader-Post gave vent to such expressions as "preposterous, incredible, fantastic." No, he did not say "peanuts" that time. It brought to my mind the time we sold the wheat to China. He was out west at that point fighting to be leader of the New Democratic party. He rushed back here and said: "The China deal is a myth; it is a pipe dream; it is a hoax; it does not exist; it is nothing." But when the farmers got their cheques last April they knew what "nothing" really was. Here we find the hon. member coming out once again and saying: This is fantastic, preposterous, incredible. Not to be outdone, the leader of the New Democratic party rushes into the house on Monday and moves the adjournment in order to discuss the very ordinary speech I made asking the farmers to consider matters which primarily concerned them alone.
Then we had this report to the Leader of the Opposition. But why did the Leader of the Opposition zig when he should have zagged? Whenever you see the hon. member for Assiniboia going one way, then, if you are smart, you should go the other way. This zigging and zagging business is something which the Leader of the Opposition should learn and remember. I do not really blame a man the first time he makes a mistake, but I cannot understand the hon. member for Burnaby-Coquitlam not knowing that he should zig when the other is zagging, because he has surely learned from his long

experience that when the hon. member for Assiniboia zigs he should certainly zag, if he is not to be entirely wrong.
However, the Leader of the Opposition has only made his first mistake. On the first two occasions when I heard the hon. member for Assiniboia speak in this house during the present session I was careful to ask whether he was speaking for the Liberal party. The first time I did so the answer came reluctantly; the second time, the hon. member was a little more confident. I can only surmise at this time that he must have been first at his leader's ear with his advice. He led his leader into a trap, because at the very moment his leader was standing up in this house and saying that my two proposals made to a farm organization were ridiculous, the farmers, after five days of cogitating about this matter in solemn convention-and these wheat pool delegates are not panicked by spokesmen for certain political parties; they look at a question and study it; they do not take these things haphazardly-at the very moment the Leader of the Opposition was denying me the right to finish my statement in the house on Wednesday, November 14, the farmers of Saskatchewan, through their wheat pool delegates, were voting in favour of two resolutions which were moved in order to accomplish what I asked them to do, namely to study these two proposals.


John Whitney Pickersgill: Mr. Chairman, I am rising on a question of privilege, because I was the person who offered, on behalf of this party, to give the Minister of Agriculture unlimited time to speak that day, if the government was willing to carry on the debate consecutively, as should have been done; and it was the hon. member for Winnipeg South Centre who denied the minister the right to go. The record in Hansard shows that.


Thomas Clement (Tommy) Douglas: May I ask the minister to read those two resolutions which have been referred to?


Francis Alvin George Hamilton: I think the sensitivity of the hon. member for Bonavista-Twillingate shows that his hide may be as thick as a rhinoceros, but you cannot get underneath it.


John Whitney Pickersgill: I just believe in telling the truth.


Francis Alvin George Hamilton: Mr. Chairman, I was saying-


Thomas Clement (Tommy) Douglas: The minister referred to two resolutions passed by the annual meeting of the wheat pool. Would he like to read those resolutions?


An hon. Member:: You had your speech.


Francis Alvin George Hamilton: If the hon. member for Burnaby-Coquitlam will compose himself-


Thomas Clement (Tommy) Douglas: I think the committee should have them on the record.


Francis Alvin George Hamilton: Like him, I want to make my speech. I was pointing out that at the time, through whatever technique he used, the Leader of the Opposition was refusing me the right-


John Whitney Pickersgill: That is another falsehood.


Francis Alvin George Hamilton: When the hon. member for Bonavista-Twillingate said that he would give the minister five minutes on condition-


John Whitney Pickersgill: Not at all.


Francis Alvin George Hamilton: -to give the house leader time to get the program for the next day from the Minister of Finance-


John Whitney Pickersgill: Read what is on Hansard.


Francis Alvin George Hamilton: I want to get on to my main point-at that very moment when the Leader of the Opposition was rising to his feet-I will put it that way-and I was not allowed to finish my statement, he was not aware of it at the time, but he was pulling the skewers on to his own chest and impaling himself on those skewers. Because next morning when wires were humming all across the country that the western farmers, through the Saskatchewan wheat pool, were supporting me, where did that leave the Leader of the Opposition? Because he had already said that my two statements were ridiculous. As a matter of fact, the next day the headline on the front page of the Winnipeg Free Press said: "Pearson blasts Hamilton's speech". That headline was written by Victor Mackie, and right underneath it appeared the words: "Pool backs Hamilton".


John Whitney Pickersgill: That is more than the Prime Minister did.


Francis Alvin George Hamilton: I suggest to the hon. member for Bonavista-Twillingate that his sensitivity indicates to me that I have scored again. The hon. member for Burnaby-Coquitlam asks for these resolutions. This is the news despatch of November 15. One resolution said:
The Saskatchewan wheat pool, in co-operation with the Alberta and Manitoba pools, should investigate methods of setting up a joint fund to underwrite the risk assumed by the federal government in granting credit to communist countries for the purchase of grain.
The second resolution recommended:
-that the Saskatchewan wheat pool investigate the possibility of setting up a joint export department with the Alberta and Manitoba pools to promote sales abroad of Canadian grain.
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All I ask is that the hon. member study those resolutions; I am not asking for anything more at the present time.
If hon. members would like to hear just what was going on, I should like to put my thoughts forward to them, so that instead of setting up bogeymen and talking about something, I say in all kindness, they know not too much about, if they had a few more facts maybe their criticisms would be a shade more on target. These points of view are debatable.


John Whitney Pickersgill: Would the minister permit a question?


Francis Alvin George Hamilton: Certainly.


John Whitney Pickersgill: In putting these views forward, is the minister speaking for the government as Minister of Agriculture, or is he just putting his own personal views forward? I think the committee is entitled to know that.


Francis Alvin George Hamilton: Whenever my colleagues decide that I am not Minister of Agriculture they will tell me, not the hon. member for Bonavista-Twillingate.


John Whitney Pickersgill: Apparently the Prime Minister said you were not the other day.


Francis Alvin George Hamilton: On Wednesday, November 14, I was speaking about the way the wheat board operates. I read into the record two quotations from a pamphlet produced by one of the distinguished commissioners of the Canadian wheat board. This pamphlet pointed out that the board gathered its grain from agents, who are competing one against the other in the gathering of this grain. I then pointed out in the second section that the board then distributed this grain to other agents who were licensed under the board to sell this grain around the world. Now, approximately 40 agents have these licences. As a matter of record, I believe the pools have these licences but do not use them. It is true that one of the pools sells some flour, but generally speaking these 40 agents of the Canadian wheat board who sell the grain the wheat board collects are private agencies, and by far the greater percentage of the grain sold by the Canadian wheat board to these agents is to the large international companies who have done a tremendously efficient job of selling our grain, as well as the grain of France, the United States, Argentina, and any other country with grain to sell. That is their business.
When I was giving the house some of these quotations from the pamphlet so as to try and stop opposition members making any more mistakes in their public statements, my 30 minutes came to an end. I was just at the

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point where I was going to go on to point out that instead of, as the hon. member for Burnaby-Coquitlam says, the whole world turning towards state trade, actually in this last ten years the reverse has been the case. Therefore I will now try and give the committee some tangible evidence to show just how this government has gone out and given some incentive-I should not say incentive, but has given some encouragement-to the wheat board to do that part of its operations which are done from government to government. Mr. Chairman, I would ask that this table be put on Hansard in its completeness, because it is valuable. These figures are for all the years I could conveniently get, and I think they are all the figures we have at the moment. In the year 1955 to 1956, for instance-


John Whitney Pickersgill: Could the minister say where the figures are from?


Francis Alvin George Hamilton: These are the Canadian wheat board figures extracted from their records, and I got them from the Canadian wheat board. The table should be called: "Table percentage of export of wheat and flour covered by master sales contracts, 19551962." Mr. Chairman, you will recall that in the last statement I made I pointed out that ordinarily the grain of the Canadian wheat board is turned over to private agencies for sale. But when it is a matter of government sales, then the wheat board comes in and does the negotiating and works out the agreements. In the year 1955-1956, which was the last full year that the previous government were in power, the quantities looked after by the Canadian wheat board, which in this table will appear as "quantity covered by master sales contracts," was 3.9 million bushels, and the quantity sold for cash, was 312 million bushels. This is one of the better years. The percentage figure showing what the wheat board sold, in relation to what the private trade sold under the Liberals, shows the figure of 1.27 per cent sold directly by the Canadian wheat board. I think that shows the hon. member for Burnaby-Coquitlam that if you go back over the previous years you will find that of this business perhaps 5 per cent would be the general average of what the wheat board sold.


Mr. Teillel:: I wonder if the minister would permit a question?


Francis Alvin George Hamilton: Yes, if it is on this subject.


Roger-Joseph Teillet: My question is with reference to this table and just where we might find it. For what year is that report?


Francis Alvin George Hamilton: It is taken from the Canadian wheat board figures and is not found

in the annual report because it has never been asked for in this form. However, that is where I got them from, namely the Canadian wheat board. For the next year 1956-57, the percentage of grain sold under master sales contracts went up to 34.6 million bushels. This was the year of the Polish agreement. Because sales dropped so low on the cash side the total sales that year were approximately $264 million and the percentage of exports covered by master sales contracts that year was 9.32. In 1957-58, you might call these the Conservative years-the master contracts went up to $41.4 million that year and the total sale to $320 million. I give credit publicly as I have done many times to the Minister of Veterans Affairs who was then in charge of the Canadian wheat board. Then there was a much bigger sale to the extent of nearly 60 million bushels that year over the previous year but the percentage of total exports covered by master sales contracts had risen to 12.9 or nearly 13 per cent. In 1958-59- and I will just give the percentages now because I want to get on with my remarks- the percentage was 10.52; in 1959-60 it was 11.6; in 1960-61 it was 19.9; and in 1961-62- that is the last crop year-it was 27.99 per cent. An increase from 1 per cent to 27 per cent in seven years shows who has been giving the encouragement to the Canadian wheat board to sell.


Roger-Joseph Teillet: Mr. Chairman, I have another question I wish to ask the minister.


Francis Alvin George Hamilton: I would ask permission to have this table printed in Hansard at this point as part of my speech.


Rémi Paul: The minister asks permission to have the table printed in Hansard as part of his speech. Is it agreed?


Some hon. Members:: Agreed.


Roger-Joseph Teillet: I should like to ask the minister a question, if he will permit one, before consent is given. I should like to have one reply before consent is given.


An hon. Member:: Consent has been given.


John Whitney Pickersgill: Consent has not been given.


Roger-Joseph Teillet: I have been on my feet trying to get the chairman's attention. I should like to have the minister's assurance if he will give it to the committee that these figures are verifiable from the wheat board record. I am puzzled by the manner of delivery. Second, I should like to have his assurance that those sales were actually not made through the wheat board, because these are very puzzling percentages. I should like his assurance that these figures can be verified in the wheat board reports.


Francis Alvin George Hamilton: I am glad to give the hon. member that assurance. I said these figures came from the Canadian wheat board and they take full responsibility for them.


Roger-Joseph Teillet: I thank the minister. He may have the consent which he requested.
[Editor's note: The table above referred to is as follows:]
Table percentage of export of wheat and flour covered by master sales contract 1955-1962.
Quantity	Total	% of total exports coveredcovered by	exports of	by mastermaster sales	wheat and	salesYear	contracts	flour	contract1955-56	3,993,000	312,260,000	1.271956-57	34,659,668	264,396,000	9.321957-58	41,407,000	320,293,000	12.921958-59	31,012,000	294,546,000	10.521959-60	32,345,000	277,291,000	11.661960-61	70,572,072	353,475,000	19.961961-62	100,172,483	357,800,000	27.99


Francis Alvin George Hamilton: In round figures I can put it very simply by saying that in 1961-62, we sold 358 million bushels and of this over 100 million bushels were sold under master agreements by the wheat board and, of course, these were on credit.


Thomas Clement (Tommy) Douglas: May I ask the minister a question?


Francis Alvin George Hamilton: Yes.


Thomas Clement (Tommy) Douglas: How does this prove the contrary of my statement that we are moving more and more to state trading? Does it not support and corroborate what I said?


Mr.. Hamilton:: Yes, it does, since we came into the operations these last four or five years; but generally speaking over the world what I say is still true.


Thomas Clement (Tommy) Douglas: Not in the United States, where 70 per cent of their export wheat was sold for other than cash.


Francis Alvin George Hamilton: Yes, it would be to the Far East. But if you take the world market for grain today as given in your report, then I think the percentage sold on the commercial market is in the main rising steadily, and this is mainly because of expansion of the private trading concerns. I could give a good example of that in the sales of French wheat this last few months through the private sector of the economy, which will increase this instead of decrease it.
I left off where I was trying to make it clear that generally speaking since this government came into power we have given this encouragement to the wheat board that has increased a number of master sales agreements. In all fairness I would point out that in this selling operation not only is the greater
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bulk sold by the very efficient private trade, but there is an increasing percentage, because of credit sales negotiated by the Canadian wheat board. However, the ministers of the crown talked to members of various governments of the world trying to sell wheat too. Members of the trade and commerce department who are in these various centres of the world are always on the alert looking for increased opportunities to sell.
I would say here at this time that in spite of all these little rumours and fears that are running around, in the next two or three years the future for Canadian sales on the export market, both in cash and in credit, are good. No matter how good it may be, I think it is my duty not to be complacent. I naturally ask myself today what else can be done. I tell this committee that I have spoken to some of the large international grain companies and have questioned them about some of the activities in order to see if it would not be possible for them to do more than they are doing. They are doing a good job. However, have I not a right as one responsible to parliament and to the people for the sale of Canadian grain, to ask our agents if they are doing all that it is possible to do and maybe suggest a few other ways where there is additional opportunity.
I do that. I have talked to the Canadian companies the same way. I have talked to them particularly about the markets in eastern Canada for domestic grain because I know the story of what is going on in the Ottawa valley and in the eastern part of this country, and what is behind it. I am not going to talk about the developments in West Germany. They are important now. It gives a good opportunity for them to carry out the function of trade in their countries. I have talked to the new ambassadors going to these new countries of Africa. They know where I stand. Most of them come to my office before they go on their tour of duty and find out how they can help best the combined effort. Private trade, the Canadian wheat board through its contacts and its officials, government officials in trade and commerce, and so on-even the diplomats in effect are taking off their striped pants and putting on their overalls in order to sell wheat.
I am not entirely satisfied with this. Here you have those of us in the selling-


Mr. Cook:: Will the minister permit a question?
(Translation):


Rémi Paul: Order. Before the hon. member can ask his question-

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(Text):
I am sorry to interrupt the minister but it is my duty to inform him that his time has expired and that unless he receives unanimous consent he cannot complete his remarks.


John Whitney Pickersgill: I would hope that the committee would give the minister unanimous consent to continue and to complete his speech. On this occasion apparently the government is not attempting to restrict freedom of speech as they did the other day. Therefore I think we should give the minister unanimous consent to continue.


Rémi Paul: Is it agreed?


Some hon. Members:: Agreed.


Rémi Paul: The Minister of Agriculture may continue.


Jean-Paul Cook: Up to now, to whom do we sell wheat outside of Canada and the United States?


Francis Alvin George Hamilton: I think there are some-and I would not be sure of the exact number- I think we sell wheat to some 45 or 48 countries. We do sell on a cash basis in other countries both wheat and flour and also we sell at the present time on credit in China, Poland and Czechoslovakia.


Jean-Paul Cook: What are the main ones?


Francis Alvin George Hamilton: The five main countries would be the United Kingdom, Japan, China, possibly West Germany next, and then Poland, I suppose. These are the big customers. We sell very little wheat to the United States -just seed wheat. I was trying to build a case here. I was trying to encourage every agency with respect to which we have some influence to sell even more. Here you have the government declaring its interest by doubling the amount of credit available under the Export Credits Insurance Act from $200 million to $400 million, thus providing greater leeway and opportunity in the making of sales. The government is willing to redouble its efforts.
I know the history of the western wheat pools. I know that they were originally formed to sell grain. I know that because of their unhappy experience in the late '20's- 1928 and 1929-they went broke and I know how they were saved by the provincial governments and the federal government making loans to them which they have paid back completely. But they have stayed out of the business of selling grain ever since. It has been left to the private grain trade to handle our grain ever since.
It is true that the Canadian wheat board gathers all the grain and turns it over to these other companies as their agents, for
[The Deputy Chairman.]
sale, but there is not a single Canadian company owned by producers of wheat in that list of agents. What I was doing was asking these hardheaded farmers of the Saskatchewan wheat pool simply to consider if there was not a possibility that they could restore the dream they had 40 years ago of producers not only making money out of the handling and storage of grain but also out of the marketing of grain. That is all that I was asking and that is why the members of the Saskatchewan wheat pool, one of the great co-operatives in western Canada, did not turn down my request to study the matter.
They knew 1 was asking them to go down to eastern Canada as a start and see if they could not help the government get western feed grain to the eastern farmers more cheaply by competing with others who are selling in that area. They know why I asked for their help. I told them that the farmers of eastern Canada needed their help; I asked for unity between east and west and I said to them that if the eastern farmers could not organize themselves for the purpose of purchasing feed grain, why could the western farmers not say: O.K., we will go down there and service our customers because they are our friends, our fellow Canadians and fellow producers. That is all I asked them. Could we have another agency of the board in addition to the 40 existing ones, just one more agency owned by the producers which would provide an additional Canadian incentive for increased sales?
I should like to quote at this time what I said at the pool meeting. It has been read into the record, but to keep my own remarks coherent I should like to read that section of my speech. First of all, may I say that in my opening remarks I spoke of all the new opportunities in new countries where we were not selling wheat today at all-not China, but countries like China which we could not bring under the Export Credits Insurance Act because of the lack of a credit rating. I described the opportunities in these new countries over the next 10 or 20 years and I said:
I am now going to put forward a second majoi suggestion for serious consideration and discussion. Will the three western pools and the United Grain Growers, acting co-operatively, consider forming a grain sales organization to enter aggressively first the domestic market and, second, at a later stage, the export market, as a real selling agent of the Canadian wheat board?
The use of the word "real" is obvious. They have a licence to sell but they do not use it. I asked them if they would form this selling agency and go into eastern Canada and see what they could do about bringing western grain into that area.

You will recall that this was the original purpose of the pools. Now in this period of intense international competition, new and unforeseen opportunities are being presented to us by ever-enlarging markets in newly developing countries.
No talk about China, Poland, Czechoslovakia, Russia, but rather of the newly developing countries.
I think this is a crucial moment in the history of the western pools and the United Grain Growers. I am completely aware of the tremendous competitive and complex nature of the grain business in the world. I am completely aware of the tremendous drive and efficiency of the great national and international grain companies and carriers. I recognize and appreciate their service and helpfulness as agents of the Canadian wheat board. But as a Canadian I put it to you that there Is a need for a great Canadian grain co-operative sales organization, particularly when you consider that so much of our domestic market in eastern Canada is serviced by co-operatives and particularly when you consider that many of our importing countries are state trading nations.
What do I get for making this suggestion? Nothing but criticism the like of which we have heard today.


John Whitney Pickersgill: And repudiation by the Prime Minister.


Mr. Winkler:: That is ridiculous.


Francis Alvin George Hamilton: The case of the hon. member for Bonavista-Twillingate is pretty weak when he keeps harping on that point.


John Whitney Pickersgill: Just cabinet solidarity; that is all.


Francis Alvin George Hamilton: You are the great expert who knows all about cabinet solidarity, the man who was described by a man now dead as a high placed leak.
I should like to refer to a statement of the type we have heard in the house again today. This appeared in the Winnipeg Free Press of November 12, just before I came back to Ottawa. This statement is credited to the leader of the New Democratic party. The article is by a member of the Free Press staff located in Ottawa and quotes the leader of the New Democratic party as follows:
It is therefore important that in selling wheat abroad the sole responsibility for this function should remain with the Canadian wheat board.
"The sole responsibility for this function should remain with the Canadian wheat board". The sole responsibility, Mr. Chairman, never has rested with the Canadian wheat board and a man who makes that kind of statement exposes the depth of his knowledge of how the wheat board operates.
If the board's selling efficiency abroad can be improved by the adding of representatives from the co-operative grain marketing agencies then such representatives could quite easily be added to the present board without detracting from the responsibility which can only be handled effectively by a government marketing agency.
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I do not blame the leader of the New Democratic party for going back to that old socialist philosophy which he discarded in Saskatchewan 20 years ago, now that he is in a new field with a new crop of suckers to harvest; but we in Saskatchewan have got used to that tune and know that in Saskatchewan he no longer talks about socialism, but that he is a man who believes in socialism cooperating with private enterprise, with private enterprise doing 90 per cent of the work. Now he goes back to the old gramophone record about state trading. This was a theory that was going to remove all our taxes in Saskatchewan but it did not work out in that way so he changed the tune. He has changed his tune again in the national field and I want to point out that this is not a man into whose hands one would want to put the responsibility of running this country.


Thomas Clement (Tommy) Douglas: May I ask the minister a question? Does the minister say that the wheat board as now constituted has not the sole responsibility for marketing wheat?


Francis Alvin George Hamilton: The wheat board has the sole responsibility for marketing wheat, but it turns it over at Fort William, Churchill and Vancouver to private trading companies and private trading companies only.


Thomas Clement (Tommy) Douglas: But the responsibility is still that of the wheat board.


Francis Alvin George Hamilton: Yes, they are just a handling agency. When I read these remarks I know that one person at least does not understand how the Canadian wheat board operates. As I also said earlier, this puts him in a position where I know he does not want to be. He is now in a position in western Canada where he says he does not want the producers to have their own company selling grain as the agent of the Canadian wheat board. This activity now must be reserved for these private trading companies. He does not want to be in this position, but that is where he is. This is the hole he is going to have to dig himself out of. This is exactly the hole the Leader of the Opposition, too, is going to have to dig himself out of. I cannot blame the hon. member for Assiniboia for being lucky all the time because he is absent today, but that is the hole he is in, too. It was for this reason the hon. member for Bonavista-Twillingate left, because he did not want to get too far into that hole.
I do not know whether the western pools will decide to set up a selling agency; that is their decision, not ours. They are going to have to put up the dollars; they are going to have to put up the know-how. They are going to have to take the risk of losing money as well as making it, because both

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things happen when you go into the selling business. However, believe me, the Canadian wheat board is strengthened, not weakened every time a new organization enters the field of selling Canadian grain as one of their agents. I think if it is good to have 40 agents, it is better to have 41. The wheat board approves because that is what they say in their pamphlets.
Let me say, in so far as consultation is concerned, that I spoke to the Canadian wheat board at great length about this proposal and they said it would be a wonderful thing if we had a purely Canadian producer company joining in the competition of selling our products.


Thomas Clement (Tommy) Douglas: And the advisory committee?


Francis Alvin George Hamilton: And I spoke to those members concerned of the advisory committee. In fact, I spoke to them about a year ago. The mere fact that they came out and said, "We have been studying this for the last few months," indicates that what I say is true. I want the producers to have a say anyway in the handling of their grain. If they want to take the risks and get the opportunity of making money out of selling their grain, then they should have it. This is where I differ with the Leader of the Opposition and his adviser, the hon. member for Assiniboia and the leader of the New Democratic party. I want more people in the swim.
Now, I am not going to lengthen these remarks unduly. There is one point I should like to put on the record. The real issue here, Mr. Chairman, is not this speech. The real issue is not these two suggestions. The real issue is the fact that, over there in the Liberal opposition they know they can never be the government of this country until they destroy the confidence the farmers of this country have in the present government. This is the real issue. They have decided to put their faith in the remarks of some of these farm leaders. These same farm leaders came out for deficiency payments, and the farmers gave them their answer on June 18. These same farm leaders came out for sales to feed mills, and the farmers gave their answer on that.
These same people had doubt about a lot of the things this government has done. I intend to go to more meetings of these farm organizations that are mentioned here and put suggestions before them, too. I want to know what the rank and file of these organizations believe, not only their leaders. This is what I did in the fall of 1960, and hon. members should read the press reports in Winnipeg, Edmonton and Saskatoon when those speeches were made. I went there with ideas different
from those which the farm leaders were espousing, and I got the reception I did, not only after my speech but after the two hour question period that followed. I put my case before the people because I have learned to trust the people and not the politicians.
This is a matter of record. The Leader-Post of Regina is not known as a Conservative paper. Listen to what it says in the lead editorial of November 16, 1962. Those who sit in the seats of the official opposition should listen and learn because when the Leader-Post says these things they do not do so lightly. I quote:
The alacrity with which some of the politicians condemned agriculture minister Hamilton's proposals on grain marketing, and the extravagance of some of the adverse criticism, are astonishing.
Farther down the editorial states:
Mr. Hamilton's proposals are worthy of a better fate than precipitate condemnation by self-seeking politicians.
Who are these self-seeking politicians? Every one of them is absent, with one exception.


Thomas Clement (Tommy) Douglas: May I ask the minister a question? Is it not true that the Regina Leader-Post has always been against the wheat board, against orderly marketing, and always been the champion of the private grain trade?


Francis Alvin George Hamilton: Mr. Chairman, they have always been against the Conservatives, I know that.


Thomas Clement (Tommy) Douglas: No, they were not last June.


Francis Alvin George Hamilton: The hon. member does not read the same paper I read.
This is my final point. Since the issue is really the destruction of the faith of the farmer in the only government which, for years, has made a move in his direction, just as he is starting to find his place in the sun, they know they have to destroy this confidence. What is the target they are setting? They are setting their guns really on this China wheat sale. This is the target on which they have to zero in, because if they do not destroy these sales to mainland China they have no hope of ever gaining strength, not only in western Canada in the farm constituencies but across this great dominion from sea to sea.
They argue that we are the only country that continues trading with mainland China. They say that while Chinese guns are shooting down Indian soldiers, we are feeding the mainland Chinese people. Let me quote some interesting figures that most hon. members know but I want to put on the record. India, itself, trades with China. As late as 1960, they exported to that country some $12 million


Roger-Joseph Teillet: Mr. Chairman, I wonder
whether the minister would indicate whether the same source applies to both sets of figures.


Francis Alvin George Hamilton: The figures I gave are published by the international wheat council in their report entitled "World wheat situation 1961-62". The information on recent sales comes to me from the Canadian wheat board.


Rémi Paul: Is it agreed that the table referred to by the minister be printed in Hansard?


Some hon. Members:: Agreed.
[Editor's note: The table referred to above is as follows:]
Exports to mainland China
July/June 1960/61	1961/62
Argentina 		(Million bushels) . . - 3.3	
Australia 	, . 43.2	71.5Canada 	, . 28.6	72.3France 	, . 	7.3F.R. Germany ..	,. 0.4	14.3Total 	.. 72.2	168.7
Source: World Wheat Situation 1961/62- international wheat council.
Recent sales: France-approximately 52.5 million bushels for shipment during the balance of 1962 and the calendar year 1963. Australia-approximately 24.6 million bushels for shipment during the calendar year 1963.


Francis Alvin George Hamilton: Mr. Chairman, I want to conclude with the highlights of what I have been trying to say. As Minister of Agriculture I have the responsibility and duty to consult with those engaged in the farm industry of this country. This need for consultation is greater now than at any time in our history. I hope to continue that pattern of behaviour.
Second, never has the wheat board been stronger, both at the domestic level of its operations and in the field of foreign sales. However, I hold to the principle that no matter how good we may think things are, they might be better.

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Third, I say that the China sale was good for Canada, and is good for Canada. I hope that world conditions will be such that in the years ahead all nations will find it possible to increase their normal commercial trade with China, and I feel that all men of good will would wish to see the humanitarian objective of providing food for hungry people be given an even higher priority than it is today, either by gifts, cash sales or credit sales.
My objectives and purposes in making my Regina speech were; first, to build up the Canadian wheat board and enlarge its sales operations; not to tear down or diminish the role of the board. Second, to enlarge the opportunities of western farmers and their co-operatives, both in expanding the markets for their products and in sharing in the profits of marketing as well as in the handling of grain; not to impose new obligations on western farmers. Third, to acknowledge the important role of the private trade in maintaining our high position in export markets and to urge a further intensification of their efforts; not to diminish the role or the opportunities of the private trade.


Roger-Joseph Teillet: Mr. Chairman, I would like to address a question to the minister. I believe he said, about 20 minutes ago in his remarks, that the prospects for export were very bright indeed this year. The question I wish to ask him is this. I understand that three days ago at the dominion-provincial conference he said that export possibilities this year were much worse than they were last year. I wonder how he reconciles those two statements.


Francis Alvin George Hamilton: Mr. Chairman, I did not bother discussing all the details that have been raised today. I wanted the Leader of the Opposition back in the chamber before I made any further remarks. I do not like saying things in his absence; I like to talk right to him when making these points. But with regard to the question of the figures I would ask the committee to keep in mind that during the last four years the Liberals were in power they sold about 273 million bushels per year, on the average.


Roger-Joseph Teillet: That is not an answer to the question I asked.


Francis Alvin George Hamilton: Second, during our period of office we exported about 321 million bushels per year in the last five years.


Roger-Joseph Teillet: My figures do not show that.


Francis Alvin George Hamilton: If you look at the export outlook you will see that this year we expect to export 470 million bushels. Is that the figure the hon. member is talking about?


Roger-Joseph Teillet: I have not got the actual figures before me; I have just the statement.


Francis Alvin George Hamilton: That is the figure. If you subtract the 140 million or 150 million bushels of domestic depletions in a good year, this means that even the very conservative people who are working in my department-the economists who do not like to go too far out on a limb-are predicting exports this year of 320 million to 330 million bushels. I do not make any predictions until near the end of the crop years, and then I like to zero in on the target as close as I can get.
When I say there is going to be tougher competition, I know there is. I simply say that with the government redoubling its efforts, even if other people come in there is nothing for us to fear; we can still handle all the grain grown in western Canada this year, even though it is one of the best crops on record.
(Translation):


Mr. Bechard:: Mr. Chairman, I take great pleasure in rising at this stage of our discussion on the revised estimates of the Department of Agriculture for 1962-63. Born into a farming family in Gaspe, a rural area where I practice my profession and where I am, thus, constantly in contact with the farmers, I suggest I am in a position to know their problems quite well.
During my short experience, I have noticed that the political parties, including the Social Credit party, of course, have been using a bit too much agriculture as a political football through the years. This tendency has shown itself to a greater extent these last few years and, as a new member in this house, I have been shocked by the remarks of our politicians on the subject since the beginning of this session. This tendency is worsening on the government side. When we hear the surprising and sometimes contradictory statements of the Minister of Agriculture, we wonder whether he is not nervous on account of the uncertainty prevailing among this minority and austerity government.
It seems that everything is said and done to get the electorate vote, but definitely not to improve conditions for the farming class. Mr. Chairman, I say that agriculture is too noble, too great and too important a sector of our economy to confuse it and drag it in the political ring.
I have already mentioned in this house, and I repeat it, that agriculture is the basis of our economy. Thus, if we want to insure the soundness of our economical structure, let us see to it first that the foundations are

sound, for a castle built up on sand will finally crumble down some day. In other words, a patchwork policy, a short term policy, can only endanger the very life of agriculture in our country. What we need, in Canada, is an over-all, new, sound and long term agricultural policy, a policy that could be developed in co-operation with the provinces, which are in a position to know more intimately and more closely the problems of their farmers.
Several good pieces of legislation have been adopted, both by previous administrations and by this one. However, several of them are of no or little use because they are difficult to apply, and others are not applicable, especially to the eastern farmers. Once again, I have nothing against the western farmers, and the eastern farmers have nothing against the western farmers. I wish to be clearly understood on that point. The treatment that the western farmers have had, and by which they have benefited, on certain occasions, must not be considered and, in fact, is not considered by the eastern farmers as a favour. They were entitled to it.
However, Mr. Chairman, it will be readily admitted, I hope, that the eastern farmers, in similar circumstances, have not received and do not receive a similar treatment. Certain laws, like the Crop Insurance Act for instance, apply only to grain. Now, as the western farmers are the greatest grain producers in Canada, they are the only ones at present to benefit from that legislation. Once again, there is nothing wrong in that. I think, and it is also the attitude of the party to which I have the honour to belong, that crop insurance should apply not gradually but concurrently to other farm products, in order that the eastern farmers may also take advantage of it. Our crops in the eastern part of the country and especially in the area I represent, are very often damaged or completely destroyed by bad weather, as is the case this year, both in Quebec and in the maritime provinces. In what situation are our farmers on account of such a disaster?
Since crop insurance does not cover the products and areas affected, farmers must face with apprehension not only winter, but also the sowing season, next spring. A national crop insurance scheme should be set up in our country, in conjunction with the provinces, so that all farmers, both from western and eastern Canada, may take advantage of the benefits of that legislation. I would greatly appreciate an increase both in the government's contribution of the pre-27507-3-1251
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mium and in the compensation that our farmers might eventually receive. It is urgent to take such steps and federal authorities should see to it right away.


Mr. Dumont:: Would the hon. member allow me a question?


Albert Béchard: When I have finished my remarks. In addition, eastern farmers, in their efforts to improve their lot, increase their income and ensure the welfare of their families, are faced with obstacles and problems on all sides.
Because of his geographical situation, he happens to be far from centres supplying the grain he needs, whether for sowing purposes or to feed his cattle. This causes serious difficulties in our farm development. Western grain is very expensive, in spite of the assistance to shipping from the west to the east which, incidentally, was affected by the austerity program of the government.
For instance, if storage does not take place early in the fall, a price increase follows in the spring when that grain arrives at the elevators at the lakehead. Steps should be taken to ensure that western feed grain is shipped in sufficient amount to our eastern ports before the close of navigation in the fall. Here I completely agree with those who advocate and insist on the immediate construction of storage facilities in eastern Quebec, for instance, where our farmers could get supplies at any time at reasonable prices. It seems to me that the present western grain transport assistance policy should apply to wheat and other grain coming from Ontario and going east.
Of course, time does not allow to deal with all agricultural matters of importance, but let us consider for a moment the dairy industry. In my opinion, there is a lot to be done in that most important area for our eastern farmers and especially those in the province of Quebec, a lot more, in any case, than to tell our dairy farmers: "Cut down your dairy production, or we shall remove the subsidies", as the Minister of Agriculture said recently. At a time when everything should be done to stimulate our economy through various means, at a time when we are asked to look after agriculture, which is threatened, as the Catholic Farmers' Union recently pointed out, farmers are told to stop producing. We on this side of the house feel that the dairy industry, one of the most important we have, should receive special encouragement.
The promotion of consumption with regard to our dairy products, in their various forms, should be encouraged by every means of publicity at our disposal.

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How many children, for instance, even in the wealthier families, do not drink enough milk when they go to school. The government should introduce a policy of free milk distribution in our schools. The health of our human capital, the strength of our young people-our leaders and workers of tomorrow-is more important and serious, I think, than niggardliness on account of austerity or on any pretext.
What we need in the farming field is, to my mind, information as well as commercial agencies which would revive our farm markets and, in many areas, create new ones.
This is no time for routine and obsolete procedures in matters of agriculture. We need immediate action leading to new concepts, so as to ensure a normal living standard and a more secure future to one of the most important classes of our society, the farming class, and therefore, in a general way, help our economy find a healthy balance.


Bernard Dumont: Just one question, Mr. Chairman, if I may.


Rémi Paul: Very well.


Bernard Dumont: If our farmers-and there are many of them-do not even earn $1,200 a year, on what basis will you establish your crop insurance in eastern Canada?


Albert Béchard: This will be up to the Minister of Agriculture to decide.


Bernard Dumont: Well, that is what I thought. You do not know anything about this matter.
(Text):


John (Jack) Henry Horner: I am pleased to have this opportunity to stand up in support of one of the greatest ministers of agriculture this country has ever had. Certainly, in the past six months there has been plenty of evidence to support that contention. One could, if needed, go back two years. There is ample evidence already in the history books of what this man has done for Canadian agriculture right across Canada.
This debate began amid a great deal of interest and concern with regard to a speech which the minister made in Regina. The second speaker for the official opposition dropped the subject immediately after the minister had dealt with it so fully in the speech he finished a few minutes ago. Apparently the official opposition have had their fill of wheat sales and wheat exports.
[Mr. Bechard.)


An hon. Member:: Wait a while.


John (Jack) Henry Horner: I hear someone say "wait a while". I am sure that with the energy they have over there and with the help of their research staff they will dig up some more muck and start to throw it. I am equally certain it will all be answered.
I am interested in this debate for two reasons, first, because when the debate began there was concern expressed about what the minister had said in Regina, and interest in the two propositions he had held out to the farmers and asked them to discuss in the winter months ahead. He asked them to consider the possibility of backing some of the credit risk in future sales, and he told them they might have difficulty in an expanding credit sales market, which is the situation in the world wheat market today. He told them that they might have difficulty keeping abreast with some of the credit sales made by other countries. That is evident because, as the hon. member for Burnaby-Coquitlam suggested in his speech, Canada was perhaps lagging behind some other countries in credit sales. So I think that the minister was justified in expressing his conclusion that Canada needed to be prepared to move forward in the field of credit sales.
The minister stated that he wanted the farmers to understand the position clearly, and wanted them to consider the possibility of their taking a share in perhaps a credit risk. What did he suggest? He suggested two or three cents a bushel off the final payment on wheat. That is not a large amount which any farmer would immediately turn down. I am certain that the farmers of western Canada in particular want to pay their way and stand behind this country in its efforts to sell more wheat. What is so wrong with taking part of the credit risk to the tune of two or three cents a bushel? I would ask the hon. member for Bonavista-Twillingate this question. If this country, or this government, or even if his government, decided upon a fisheries exports sales policy and asked the fishermen to take a certain percentage, say one half or one quarter of a cent per pound, off their price of fish, would his fishermen not support that, if they knew that the government would stand the rest of the credit risk? Would his fishermen not be pleased to see the country move in to an aggressive export market in that product? I am sure that they would, in the same way that producers of other products besides fish and wheat would. This is evident under the

Export Credits Insurance Act which we have greatly enlarged, where the manufacturer already takes 15 per cent of the credit risk and the Export Credits Insurance Corporation stands the other 85 per cent. There is nothing wrong with the proposal as far as I can see. It is a proposal which enables the farmers to get behind this government, or any other government, in order to sell their products, and 1 am certain that anyone in business will appreciate the fact, that they are likely to pool their share of the load.
It is interesting to note some of the remarks made by the hon. member for Assiniboia. The minister dealt with them quite fully, but the hon. member has quite a record for coming out with famous words. We all remember his phrase "Peanuts". He said about the Chinese agreement that it was "lopsided". Now he calls this idea "fantastic", "incredible" and so on. These expressions are all quoted in the Regina Leader-Post.
I think the minister has pointed out the basis for this initial proposal and the soundness of it. If anyone is in doubt let him ask himself whether the lumbermen would not be interested in sharing part of the credit risks of a large credit sale-or the fisherman, or the fruit growers. I am certain that the major producers of any industry will be prepared to take two or three cents a bushel off their products in order to support this proposal fully. So therefore it is no wonder that on second thoughts we have had some of the about faces which we have seen here today. 1 realize that in a country like Canada we must be careful not to enter into a credit race with regard to needed products, but we must maintain our credit sales in order to hold our position in world markets. Canada is, of course, the largest commercial exporter of wheat in the world today. That is quite a position to hold for a country as sparsely populated as this one.
The hon. member for Red Deer spoke at great length about the areas which were untapped which we could still get into. Some knowledge of the wheat industry was portrayed by his party when another member of the same party asked what other countries we sell wheat to besides the United States and China. The minister replied that we sell wheat to 44 countries, that we are endeavouring to move into every country of the world with wheat sales. The minister stated in his speech in Regina the following, and I should like to read from the Western Producer:
However, Mr. Hamilton thought a great challenge to wheat sales lay in new and untapped markets. If, through international commodity agreements, newly developing nations could get stabilized floor prices for their own basic products, living standards would go up and with even the slightest increase a large market would be opened to Canada's grain.
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This shows the interest and continual watchful eye which the minister has, and is continuing to have, on all the untapped markets which may exist in the world today.
The hon. member for Red Deer dealt at great length with the untapped markets still within what he termed the free world. He said that hunger and want were the greatest threat to peace in the world today. He classed that hunger threat over and above communism. He classed it over and above some of the other racial threats made in recent days. He classed hunger as the most important and dangerous threat in the world today. He went on to say that surplus food was our best weapon, and that we could use it. But he wanted integration with a defence policy, an external affairs policy, and an agricultural policy. Well, if that is not using food as a weapon of war, as the hon. member for Burnaby-Coquitlam said-that is the only point he made with which I agree-it is certainly the next thing to it. He must have meant that he wanted the external affairs department to put out literature for communist countries to read, so that they could be "red as well as fed". Perhaps that is what he had in mind.
In connecting his integrated system of defence, he must have had in mind the use of food, or use of the lack of food, as a weapon in this so-called cold war which is existing between east and west.


Mr. Patterson:: Do not misconstrue what he said.


John (Jack) Henry Horner: I am quoting practically word for word and I am sure Hansard will bear me out. He went on to say that the communist system lent itself better than our free world system to the use of food and trading policies in their aggressive ideas. All this will be on Hansard without any doubt. But when he asked how we would get into these untapped areas-and the western farmers are always interested in furthering Canadian sales, which is the theme of this debate-the minister made a couple of suggestions, although some people did not like them. One idea for furthering sales, according to the hon. member for Red Deer, was to have a two price system. Many western members here have worked for a two price system. He used this as a method to get into untapped markets. He used it as a method to lower our external price and to raise, one might say, our internal price. What effect would that have on the world wheat market? What effect would it have on the international wheat agreement? A two price system to enable us to get into untapped markets would place Canadian wheat at a price on the world wheat market which would ruin the market

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and ruin the international wheat agreement. There would just not be any agreement, and certainly alter a few years there would be a very highly subsidized agricultural industry in Canada, because our internal price would have to remain a great deal higher than that of the international market. There is one thing we must guard against as strongly as possible, the effect of lowering the international wheat market. If we ever start cutting prices, no one knows where it will end. Nothing could ruin the farmers more quickly than the cutting of the international wheat price.
He went on to deal at great length, as some Social Crediters are wont to do, with the starving people in the world today. He spoke of India and the starving people there.
I wonder whether the problems in India are not perhaps something besides food and the getting of food over there. It might be interesting to point out that India has the largest cattle population in the world today and that while many go hungry in that country there is still food available. However, other barriers exist which prohibit them from using it. There are other areas which could be developed to produce food and reduce some of the starving that goes on in the world today.
He talked at some length with regard to an international settlement account on which sales on the international market could be made and products would be then paid for under this international settlements account. I wonder whether printed money would be satisfactory on that international settlements account. I wonder how credit money would work in that regard, or how debt free money would work, or how their system of deficit financing would work. It would be very interesting to see them in operation.
The hon. member for Red Deer spoke also of another matter, and this is one point on which I agree with him. He said that in the agricultural field Canada itself is its best customer. I agree with him. Canada can and does consume practically all of its cattle, hogs and sheep, not all the butter but most of the milk and a large share of the grain. However, he went on to say that we should develop some way in which we could get the surplus grain in the west down to the less fortunate areas in the east. I hope he was not thinking of an earlier speech made here by one of his supporters with regard to the wheat board, when he said he wanted to buy wheat for a cent a pound in Quebec. He cannot buy it in western Canada for that price so I do not know how he could buy it in Quebec and cover the cost of hauling it down. I do not know who would sell it to him.

Anyway, it was interesting to hear his theories on China and how we should not be selling wheat to China but should be selling to some other areas. The minister dealt quite fully with the question as to who is selling to China and who is not, and whether other countries have stopped, and whether we are the only commonwealth country that is trading with that nation. Certainly I believe that we must watch the conditions that exist in India and China. However, up to the present time other commonwealth countries are trading with China and we should perhaps continue with our trading policy either until the situation worsens or China announces an aggressive policy under which it could perhaps take over all of India, which as yet it has not done.
The Leader of the Opposition made a very interesting speech. The hon. member for Bow River placed a question before him; he did not answer. He set about reading something vaguely, but he did say that the minister's remarks in Regina were ridiculous. This was his statement on November 14, as reported in Hansard. I listened closely for any constructive ideas that might have come from the Leader of the Opposition. He was great at criticizing but he offered no solutions. He suggested his $2 a bushel price for wheat was a great thing. Actually he pointed out that it would be a subsidized price. I do not know how his other supporters, particularly those who feel that eastern Canada may be running a little bit short, would like that. Anyway he thought that the $2 a bushel price was a good idea. He spoke at length with regard to how he thought the United States trade policy was a good one. Actually if he read the papers here recently he would know that the United States said to the European common market, "You trade with us, or else. If you raise tariffs on our goods we will have to do the same with goods from your country". That is not much of a free trade attitude. He said we must give the European common market a great big push forward. He said we must protect the producers of this country, that they are going to have to adjust to the European common market, even if they have to adjust their production. That is a dangerous thing he was dealing with.
The Prime Minister of this country sought the assurance of Great Britain that our producers would have the same privileges in that market as we have today. That assurance was given, for which we are very thankful. The hon. member for Burnaby-Coquitlam worried a great deal about the risk. He was suspicious; he was worried. I am sure he used the word "suspicious" about four times. He also went on to say that he had to admit that other

countries were expanding their credit sales and that Canada had not actually touched on credit sales as yet. However, he was worried that the farmers were going to have to stand two cents a bushel on wheat sales. Apparently he feels that the fact that the farmers are asked to spend two cents to three cents a bushel is a great big risk to future wheat credit sales. Yet he contradicted himself in his own remarks when he said this was an assured market, that Canada had not touched the bottom of the barrel with regard to credit sales. I listened very closely to his remarks in order to see whether he was against the two suggestions in the minister's Regina speech. From his remarks I gathered that he was worried and suspicious about it, but he did not know whether he was against it any more, and he did not know whether he was for it. He was just worried.


An hon. Member:: He ought to be.


John (Jack) Henry Horner: You cannot really blame him for being worried; that is true. Anybody who left his native province under the conditions under which he left it.


An hon. Member:: He did not leave; he was chased out.


John (Jack) Henry Horner: I bow to the hon. member's knowledge.
The minister tells us his second proposal with regard to the wheat board and the actions of the wheat board. He pointed out that there were very few people who were so eager to condemn him who knew what they were condemning. This is borne out in a report published in a weekly news analysis featuring farm policy where we find the following:
Farm organizations and members of parliament demonstrated this week how little they understand the key farm problems. They also demonstrated how little they value the efforts of a minister who has accomplished so much for farmers in his two years in office.
That is what this farm weekly analysis said with regard to some of the most eager critics of the minister's Regina speech. Actually the minister pointed out that the wheat board handled the wheat and offered the wheat to the grain exchange to sell at such and such a price on a given day. The grain exchange consists of a body of agents who are prepared to sell it at that set price which the wheat board lays down on that given day. The minister's idea was that we should have a national organization specifically interested in furthering Canadian sales at home and abroad.
Certainly the idea has been discussed for some time. Certainly the idea has a great deal of merit. The wheat pools and the
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United Grain Growers admitted that they are and have been considering it. They think they might like to enter into the plan but it is a big step to take, as the minister warned them. He said he knew they had a knowledge of the trade and would proceed very cautiously and properly, though he hoped that eventually they would take this step so that competition in the sale of grain could be increased and more grain sold and, so that no corner of this country and no corner of the world would be left untouched as the result of an aggressive sales policy for western wheat.
(Translation):


Bernard Dumont: Mr. Chairman, yesterday, I met a reporter who told me: "Mr. Dumont, we do not hear you any more. Is it that you intend to always yield your turn to others?"
I can say I had a striking example of this as a young boy. At the end of a parish retreat, I had received holy communion and I was in the front of the church making the stations of the cross and saying my beads and other prayers, when another good parishioner came up and told me: "Dumont, move away from there. You are hiding God, and we want to see Him too." That is the reason why I have, lately, given my colleagues a chance to be heard in this house. Sometimes, I am known to be talkative.
Mr. Chairman, after the speech of the Liberal opposition leader (Mr. Pearson), the curtain fell on the second act. The hon. member who is the power behind the throne in the Liberal party made no serious or constructive remark. He only repeated his endless speeches, which we have heard since the beginning of the session. I wish to reward him for his effort by calling him a good actor, but I can give him the assurance that not everybody will enter into his political game.
Besides, when we refer to Hansard for March 1957, at which time his party was in power, we realize that the then Liberal ministers had the same headaches as the Conservatives today. That is why we say that under the two old parties, "the more things change, the more they are the same."
Mr. Chairman, I should like, at the offset, to give a few details concerning the pamphlets which we are trying to get. Last week, for example, we asked the Minister of Agriculture (Mr. Hamilton) for a French version of the folders published by the Canadian wheat board. In fact, I wish to inform the minister that, as far as I am concerned, I am ready

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to use Shakespeare's tongue as soon as he will consent to speak in French. And, as a proof of my good will, I say in this house that I shall be happy each time that co-operation will be given to bring about national understanding in our country. Each time I put forward a claim for the French language, I want to show that in our parliament in Ottawa you have to ask to get something. I find each day that our brothers from western Canada were unaware of the fact that we were sometimes discriminated against, especially during the 22 years of Liberal government, which has done nothing to promote understanding between the two races.
Apparently, nothing could be done about it, save to accept the situation.
Thus, there is nothing surprising in the fact that everything has to be done in the field of national understanding.
As an equal partner in Canada, I even want to challenge the hon. member for Port Arthur (Mr. Fisher) and tell him that, as soon as he has learned to speak French, I shall speak English, and we shall both go and visit Lili St. Cyr and Maurice Richard, to recall his famous statement. I think this is very timely. But, seriously, I would rather take him-as well as the Minister of Agriculture-along to visit our Quebec farmers, who are candid and kindly, sincere and generous, and whose good farmers' souls have remained unspoiled, so that we may hope, indeed, to see Canada supplied with the balanced and sensible men which the countryside always has produced.
The problem now being discussed has been the subject of many a debate in the last 40 years, and we have gone from the Grits to the Tories, and from the Tories to the Grits, without getting any practical solution, except that the farmers did set up the Canadian wheat board in 1930.
But, today, we also suffer from what the thirties called the deadly flood of wheat. I have here an item published in the United States, but which might well apply to Canada. The article, which is entitled: "The deadly wheat flood", reads as follows:
An American newspaper heading described the wheat situation as "serious".
If they had read that, our grandfathers would have come to the conclusion, naturally, that North America was threatened by famine. How wrong would they have been. Because that title means exactly the contrary of what it would have meant 50 years ago. Because if in the United States, the wheat situation is "serious", it is because they have too much of it (as well as other farm products) and they do not know what to do with it. And the most horrible thing is the fact that the crop this year has been extremely abundant.

What a sacrilege not to be able to help thousands of people, billions of people, as the hon. member for Red Deer (Mr. Thompson) said a moment ago, suffering from undernourishment and thousands of children who do not even have the chance of reaching ten years of age.
This deadly flood of wheat and of all the other products-because there are so many people to feed-reminds us too much of the time when the Liberals were in power, and I quote, from page 2155 of Hansard for March 13, 1957, a question asked by a Conservative member, the hon. member for Moose Mountain:
-payment of all carrying charges on all the grain in commercial storage positions at the end of the crop year, as advocated by the western farm pools in their submissions to the federal government on Saturday March 10?
What steps was the government prepared to take in that connection?
And the then minister of trade and commerce, the Right Hon. C. D. Howe, asked:
What steps would the hon. gentleman suggest?-
That is exactly because the western farmers, like the eastern farmers, thought that the Liberals in power at that time could not accomplish anything, that they put their confidence in the Conservatives.
And besides, the Leader of the Opposition stated some time ago that the Conservatives were not doing any better.
So, what we have stated during the last election campaign is that the people of Alberta, Saskatchewan and Manitoba will think that, with the old parties, we cannot expect any improvement.
I should now like to quote a statement made by the hon. member for Assiniboia (Mr. Argue), who at the time was a socialist and who was asking embarrassing questions of the Liberals. And, as it is often said that the Liberals and the socialists are bedding together, the former came back to the same ideas put forward by the hon. member for Assiniboia in 1957, when he said:
The Minister of Agriculture-
Mr. Gardiner, at that time-
-no longer has the courage to confront a meeting-
And it is still the hon. member for Assiniboia who is speaking-
-sponsored by a bona fide farm organization in western Canada to discuss in public, with representatives of other political parties, his discredited agricultural program. Apparently he does not dare to come to such a meeting.

And he said further:
I should be quite happy to discuss with the Minister of Agriculture on a public platform anywhere in this nation, at a meeting sponsored by a farm organization, the way his policies and those of his government are undermining and destroying the agricultural industry of this nation and forcing thousands of farmers to leave their homes in discouragement because they are unable to make ends meet.
The hon. member made that statement in 1957. He changed his views since then, because he joined those good Liberals, in the belief, no doubt, that very strong offsprings would issue from that union; but I believe, on the contrary, that they will be quite weak and that the socialist party, with 119 members sitting in this house, will have to bow before Social Crediters after the next election.
At that time, the Liberals no longer knew what to do. Do western farmers think they are more sincere today? Not a bit. As for us, from Quebec, we no longer trust them because we know they are only actors bent on returning to office. The hon. member for Assiniboia wants to revive horse breeding, but he will not be taken seriously, because in the province of Quebec, all farmers use only tractors, and the Liberal party will surely not be prosperous with the Boulangers-
(Text):


An hon. Member:: You know what they are too.
(Translation):


Bernard Dumont: Here is what I read in the newspaper La Presse of November 13:
The wheat pool spends $700,000.
According to a report published yesterday, the Saskatchewan wheat pool spent over $700,000 in building, improving and maintaining grain elevators during the first half of 1962.
The rebuilding of elevators at Balcarres, Leroy, Plato, Raymore, Star City, Turtleford and Waldeck should be completed around next November 24.
According to an official spokesman, the capacity of the elevators, when completed, will be of approximately 96,160.000 bushels.
I have no objection to the building of grain elevators for the western farmers because I know they have to store their grain.
In the very first days after the opening of the twenty fifth parliament, probably a little awkwardly, I moved the adjournment of the house to discuss the urgent problem of 92,000 farmers whose income is only $1,200 or less, and to take steps to immediately build for them elevators as was done in Saskatchewan. That is a most urgent matter. If grain could have been stored in the east this year, farmers could have been in a position to pay less for it. I found out that grain coming from Fort William is still too expensive, even after all costs have been paid.
Supply-Agriculture
The Minister of Agriculture informed me that the difference between the price obtained by the producer and the price paid by eastern consumers is due to costs of delivery to terminals, storage, interest, cleaning, drying when necessary, insurance, association charges, inspection, warehouse receipt cancellation, freight including elevation charges, etc. There would be 25 lines of that to read.
After paying all those expenses themselves, the 240,000 farmers receive only $2.25 per hundred pounds. On the other hand, in the east, we pay for that No. 3 wheat, that feed grain, $3.60 per hundred pounds. I am told that this difference in prices is due to the transportation costs. Allow me to point out that I inquired from a transport company and found out that, at the present time, the private companies charge only 12 cents per hundred pounds to transport that grain. And we could find others whose tariffs are even lower.
It means that once that feed grain has reached the elevators that I suggested should be built in Berthier, in the Gaspe peninsula, in the Saguenay region and along the St. Lawrence river, it would cost the eastern farmers only $2.40 per hundred pounds, because the St. Lawrence seaway makes it possible to transport grain more rapidly and at a lower cost. Furthermore, I was saying that it would cost them only $1.20 because they would go and get it themselves at those elevators.
I feel that the Minister of Agriculture, who is so fatherly, will give all his attention to this serious problem of today. I am of the opinion that the western farmers would not be any the worse for it. On the other hand, the eastern farmers would enjoy a higher income.
I realize now why seats on the exchange cost as much as $50,000. I realize also why some feed dealers do not want the western farmers to ship their grain directly to the eastern farmers, because that would not be to the advantage of those who make enormous profits.
But I maintain that we must do away with these middlemen between the western and the eastern farmers, because the western farmers, as well as the eastern farmers, are all farmers on the same footing.
Personally, I have been brought up with the idea that the mother of a family-and I think of the government as the mother of a family-must treat all her children in the same way. It is not because one is good looking, because the other has red hair, another

Criminal Code
one dark hair, that one is French Canadian and that the other speaks another language, that he must be treated with less consideration. Even though I do not like to see the government interfere in our business, I ask the Canadian wheat board, inasmuch as it already operates elevators, to build grain elevators in the east. Then we will be able to get the feed grain needed directly from the elevator.
There is not a single farmer who does not use at least 200 one hundred pound bags of feed in a year. That would immediately mean an additional income of $200 for those farmers.
It is not elevators that we want on our farms. I know that the Minister of Agriculture has certain ideas in that respect. But freight rates, storing of grain in Quebec city and Montreal, and its shipping by train afterwards to the farmers, are really too costly.
What we need is elevators in our seaports from Montreal to Gaspe, even on the Saguenay and in Chaleur bay. That would help 92,000 farmers whose income is less than $1,200 a year.
Mr. Chairman, may I call it five o'clock? (Text):


The Acting Chairman (Mr. Crouse):: So that the house may proceed to the consideration of private members' business it is my duty, pursuant to section 3 of standing order 15, to rise, report progress and request leave to sit again.
Progress reported.



CRIMINAL CODE


Mr. Frank Howard (Skeena) moved: the second reading of Bill No. C-20, to amend the Criminal Code (trading stamps).
He said: Mr. Speaker, this is the third or fourth year in a row in which I have introduced this particular bill. We have had debates on it on other occasions, one of which lasted a full day during the time when the rules of the house were such that private members' business could be dealt with for a full day. One of the theories which was supposed to be of assistance to the general public, in so far as the operation of free enterprise is concerned, was that free enterprise would be guided by the principle of competition; that this would automatically bring to the

consuming public the best quality product at the lowest possible price. But this theory or principle, so-called, of competition has not operated too well, if at all-at least during the time I have been alive, and I am sure for many years before I was born.
The business community soon discovered that price and quality competition amongst themselves was not too helpful to business, so they very quickly dispensed with the operation of competition in so far as price and quality were concerned and moved into the field of price fixing arrangements and restrictions so far as quantity, quality of production and the like, were concerned. They found this to be far more profitable than competition in the field of price and quality. Competition was very quickly confined almost exclusively to the field of advertising. Advertising media were used to convince the general public that it was getting a better quality product and the lowest possible priced product, when in fact that was not the case. This practice still operates today. We are still told that Gleem or Glush, or whatever other type of toothpaste one might want to use, is the best type of toothpaste for making your teeth whitest, your breath sweetest, and to make you sexually attractive to somebody else. This is what advertising tells us. It does not at all produce a better quality product or a lowest possible priced product; it merely attempts to convince us that such is the case.
Trading stamps fall within the category of being an advertising gimmick, in that they are used to try to convince the consuming public that it is getting something for nothing, that these stamps are in fact free. Perhaps this is social credit in operation; I do not know. But it is a known fact that somehow or other the business which uses these trading stamps, whichever one it might be, has to find the money to provide the stamps and the articles for which the stamps are traded. The cost of these articles comes from the sales dollar of the particular business or company, and the consumer pays for the trading stamps and for the articles he receives through the prices he pays for the commodities themselves. Notably, and almost exclusively, these trading stamps are used in that section of the business community which is engaged in selling food products.
The use of trading stamps, besides being dishonest and contributing to the cost of food, tends to contribute a great deal to the concentration of economic power into fewer and fewer hands within whatever section of the business community the stamps are used. The corner grocery, for a variety of reasons, is not able to afford the type of advertising budget which will allow him to compete in the

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advertising field with chain stores using stamps. These corner grocery stores tend to suffer as a consequence. In fact, the royal commission on price spreads of food products indicated in its report-I would just like to make a brief reference to some of the statistics contained in it-that 37.2 per cent of the business accrued to food chain stores in 1951 while in 1958 this had increased to 64 per cent. On the other hand, in 1951, while independent grocers, corner grocery stores and the like, had 62.8 of the market, by 1958 this had declined to 36 per cent. I am sure that any analysis of the statistics beyond 1958 will show that this has grown even more out of proportion and that food chain stores have an even larger percentage of the market, while the independent grocers or small corner grocery stores have a relatively smaller percentage.
This growth of economic power and control has been undoubtedly enhanced by the use of trading stamp plans to the point where the consuming public is relatively helpless, to the point where the farmer himself-about whom there was some discussion earlier this afternoon-gets caught within the squeeze by virtue of vertical integration and the like, and to the point where the small businessman finds himself in difficulties. This growth of economic dictatorship, assisted and contributed to by the use of trading stamps and other similarly dishonest methods of advertising, puts these three basic elements of our society in an unfair and helpless position, namely the consumer, the farmer and the small businessman. I think the only element in society which can protect these individuals is parliament.
The Criminal Code of Canada has had in it since 1905 a prohibition against the use of trading stamps. However this law which was enacted 57 years ago has a loophole in it. It says in effect that you cannot issue or use trading stamps, but the loophole is that you can in some instances. That is why stores such as Loblaws and the like are able to issue trading stamps. The intent of the particular bill before us is to plug that loophole and make effective the principle contained in the law, namely that trading stamps should not be used. So long as the government in office-and the previous government allowed this to happen-wants to maintain the present section 322 of the Criminal Code we will continue to at least give lip service to the concept that trading stamps are harmless and are not disastrous to our economy. I think this parliament should persist in this matter and extend the principle contained in that section so that trading stamps are completely outlawed. This bill merely seeks to make the law effective and to block the loophole which
has been found by trading stamp companies and by food chain stores, thereby providing the protection necessary to retail firms, consumers and small businessmen.


Mr. J. N. Ormision (Melville):: Having listened to the hon. member for Skeena discuss once again the subject of trading stamps,
I have to agree he deserves a certain amount of credit for his perseverance and assiduity. He has brought this subject forward, he reminded us, for four years and I think he shows considerable tenacity. Although the bill before the house contains a few proposals which are neither new nor original, they are interesting and might well be timely.
There is nothing very new about trading stamps, either, because they have been used in one form or another for over 60 years. The practice of giving stamps, coupons or other devices, while usually recognized as legitimate and confining itself to a certain section of the market, seem to have a tendency to move in cycles, that is, it develops and recedes. The present situation has developed through the activities of the promoters of trading stamps, over which the retailer has little control, and the problem which confronts the consumer is whether or not trading stamps have the result of increasing the price of the goods he buys. It is generally agreed that this is the case. It seems also that promoters and distributors are the people who favour the system of distributing trading stamps, and benefit most from it.
When we examine this whole situation we find that the use of trading stamps is actually an inducement to buy and that these trading stamps are then placed in the realm of advertising, which automatically opens up a wide field for discussion. However, let me point out that there is considerable difference between legitimate advertising and a type of promotion scheme to suggest to the buyer he is getting something for nothing. Obviously the cost involved in the distribution and promotion of trading stamps is considerable and it is equally obvious that somewhere along the line the consumer will be paying. In many cases where we are subjected to the advertising of stamps, the costs must be computed. In spite of what can be said against this practice there are those who collect trading stamps with considerable enthusiasm and would feel that government interference would be an imposition and a violation of some of their rights.
At the same time the practice of issuing trading stamps has been opposed by various organizations as a drain on time, effort and money and definitely not in the best interests of the consumer.

Criminal Code
However, if the consumer concerned wishes action taken, it must be admitted that his protests so far have been erratic and divided and that the amending of the Criminal Code does seem to be rather a harsh manner in which to curb what some believe to be an innocuous practice. On the other hand, it may take such action to dispel the illusion that the consumer is getting something for nothing.
In essence, the bill seems to fail in its basic intent in that it proposes a form of regimentation, to replace freedom of choice in human conduct by government regulatory action.
In application the bill would prevent the retailer from supplying a piece of paper representing the retailer's intention to redeem it by way of premiums on purchases. Surely this would inhibit only one field of merchandising, and if it was the intention of the trade to give discount or premium on goods purchased, many other avenues could be opened for such action. The interception of business transactions is certainly not the prerogative of government, and legislation should not be substituted for freedom of choice. While the bill does try to achieve something constructive it appears to be right in principle but wrong in practice, and I regret I cannot support it.


Mr. R. A. Webb (Hasiings-Fronlenac):: 
Mr. C. A. Gauthier (Roberval):: Mr. Speaker,
the bill under consideration does nothing either for section 322 of the Criminal Code or for the consumer. In fact, I feel that the best thing we could do for the consumer would be to repeal section 322.
If our distribution system were adequate, that is if the consumer enjoyed proper purchasing power, do you think it would be necessary to promise a doll to the mother of a family whose concern is the purchase of food for her children?
Certain pieces of legislation which were adopted by the old line parties who are the servants of finance, remain as a testimonial to their absurdity. Bill C-20 is an example of such legislation. Indeed, even though heads of families would need from 25 to 30 per cent more income to balance their budgets, dealers everywhere are trying to get their business by promising gifts if they buy from them. The only trouble is that the consumer does not have the money to buy.
Let us put an end to our tragic jokes; instead of acting like clowns in the house, let us try to be more serious when the time comes to adopt legislation for the advantage of the general public. Let us act as true legislators as the people expect and instead of changing two or three words in the bill under consideration, let us enact statutes for the welfare of the Canadian people.
Mr. Speaker, we feel that the government should bring in an amendment to double family allowances so that large families may balance their budgets. Instead of playing Santa Claus, we would thus be acting like the men of foresight we should be.
As for the bill introduced by the hon. member for Skeena (Mr. Howard), I fail to see any great difference between trading stamps and mass advertising. It is always the consumer who has to foot the bill. The consumer has more and more wool pulled over his eyes. During my 28 years of business experience, I have always had as a principle that the best guarantee a retailer could offer his customer was fair and equitable service. The best customer is the one who has an adequate purchasing power, not the one you have to convince through trading stamps that he should buy. This system does not bring so much to small businessmen, but it mainly brings large profits to companies distributing those stamps. The management of those com-

Criminal Code
parties have contended that their business volume has increased but that of the small retailer has decreased.
I have always been opposed to gimmicks which bring no additional profit to the retailer but which may have cost an extra 10 per cent for the consumer who has been conned into purchasing beyond his means.
Therefore, let the consumer be free. Let us stop unduly tempting him to the advantage of outsiders.
(Text):


Mr. Thomas R. Berger (Vancouver-Bur-rard):: Mr. Speaker, I rise to support the bill before the house in the name of the hon. member for Skeena. This measure proposes that the Criminal Code be amended to prevent the use of trading stamps by corporations engaged in the sale of food in supermarkets and the like. Of course, as those of us in this party believe, such a measure is badly needed in Canada today when trading stamps are being so widely used in order to induce people to buy goods they do not need with money which so often they require for other purposes. The use of trading stamps is one of the bad features of what has been called our acquisitive society.
There is prevalent in commercial circles the view that it is the citizen's duty to consume whatever may be produced by the industrial machine. Decisions regarding consumption do not really therefore rest with the consumer; they rest in the hands of those who control the economy of this country. The consumer is not the proud possessor of what economists call the consumer's sovereignty. His sovereignty, if he has any, is hedged about by the blandishments and inducements that are forced upon him by the advertising industry. If advertising will not induce him to consume the things produced by industry then, so their philosophy goes, he can be induced to consume these things by offering him trading stamps which entitle him to small prizes that become obtainable if he has accumulated enough trading stamps. Much of the industrial activity today is geared to the production of goods which are often a duplication of goods which have already been produced by other manufacturers. There is such tremendous duplication and overlapping that the great concentration of advertising today has resulted.
Let us consider the example of toothpaste. The hon. member for Skeena referred to toothpastes called Gleem and Glush, describing them as two well known brands. I think the house will be interested in knowing that the cost of an ordinary tube of toothpaste consists to the extent of 50 per cent,

in the actual cost of manufacturing the tube and the toothpaste, and getting it to the shelves of the merchant, while the other 50 per cent of the cost consists of advertising.
Of course, one brand of toothpaste is just the same as another. There are practically no differences between them. They all make extravagant claims. The people who have studied the subject tell us that only one brand has any justification whatever for the extravagant claims which all of them are making. Because I do not wish to give any one manufacturer an undue advantage I will refrain from mentioning the name of that particular brand which, so we are told, has some slight justification for the extravagant claims made on its behalf. But this is typical of our situation today.
We are spending far too much money on things which have little or no social value, while we are neglecting things which are badly needed. We are spending millions of dollars on advertising; and of course trading stamps are a form of advertising. Their purpose is the same, namely to induce the consumer to buy things which he may very well have no desire to buy. In fact, the suggestion has been put forward in some quarters that there ought to be a tax on advertising. No doubt members of this house at an appropriate time will be able to give consideration to such a proposal. At any rate, I congratulate the hon. member for Skeena on putting forward this bill which I know will commend itself to members of all parties. I know they will be anxious to restrict their comments upon it so that the vote can be called before the hour for private members' business this afternoon has expired. I am sure all of them will join me in congratulating the hon. member on placing this bill before the house.
I should like to conclude by suggesting that, as the hon. member for Skeena himself said in presenting the bill to the house, legislation of this kind is badly needed not only in the field of trading stamps but in many other fields. We must put an end to false and misleading advertising. We must put an end to false and misleading methods of merchandising. I suggest to hon. members and to you, Mr. Speaker, that the house can make a good beginning by passing this bill unanimously this afternoon.


John (Jack) Henry Horner: Mr. Speaker, just for the benefit of the previous speaker I should like to say that I certainly cannot go along with his last remarks in complimenting the mover of this particular bill. This is one of the few times I find myself in disagreement with the hon. member for Skeena.

Criminal Code
The previous speaker went to great lengths in concluding his speech to suggest that many more pieces of legislation of this type are needed. It all goes back to the old business of controls, controls, controls, rigid controls, under a socialist N.D.P. party. That is what it looked like to me, when he said many more pieces of legislation of a type similar to this are needed. It all goes back to that old fact that they want control. They want to put us in a strait-jacket. I cannot buy that kind of argument, I cannot buy it at all.


Thomas Speakman Barnett: Will the hon. member permit a question?


John (Jack) Henry Horner: Yes.


Thomas Speakman Barnett: I wonder if the hon. member would suggest that the controls in the Criminal Code which prohibit the robbing of banks should also be eliminated.


John (Jack) Henry Horner: That question is so irresponsible, Mr. Speaker, that I do not think it requires an answer.


Thomas Rodney Berger: Will the hon. member permit a responsible question?


John (Jack) Henry Horner: That is an admission that the first one was not responsible.


Thomas Rodney Berger: As the hon. member knows from listening to the able address of the hon. member for Skeena, there is already in the Criminal Code a provision which relates to trading stamps and which prohibits their use. If that section, which this government has not seen fit to remove is worth while, then why is the hon. member not prepared to support the bill which was presented by the hon. member for Skeena and which simply blocks one of the loopholes?


John (Jack) Henry Horner: Mr. Speaker, I have just uttered about three words of my speech. If the hon. member will let me make my speech perhaps he will be able to gather why I am not prepared to support it. Actually the question of jurisdiction may be involved. In Alberta, which has a similar type of government to British Columbia, our neighbouring province, though a similar government in name only-


An hon. Member:: Just as bad.


John (Jack) Henry Horner: Yes, I think I can agree with that-we are not troubled with trading stamps. Saskatchewan has a law respecting trading stamps which is condemned pretty strongly by many small businessmen engaged in private enterprise in that province. They feel it is a weapon held over their heads. This may or may not be true. But I think it is evident in this country and in the
United States that people are looking for less and less government interference. They are seeking less and less control. We saw this in the recent election in the United States. The states are continually complaining about the federal government moving into their field.
The same is evident in Canada. The provinces are continually worried and complaining about the federal government moving into their field of jurisdiction. One can also go back to the municipalities which are worried and complaining about the provincial governments taking over their responsibilities. In fact, to take it one step further, one can go back to the people who are worried about the municipalities taking away what one might call some of their opportunities for free choice.
Stamp plans have been around for a long time and we have seen many different versions of them. Someone said that we have had these stamps around for the last 65 years. I know they have been in Nabob coffee and tea for a long time. Certainly when I was a little boy, growing up, and opened the kitchen cupboard there were generally a few Nabob stamps there. People used to save box tops from packages of cereals, which is much the same thing, possibly to get toy water guns in those days. I forget what we used the box tops for but we thought the cereal was pretty good. In fact, manufacturers of soaps and cereals use all kinds of gimmicks, such as 10-cent coupons inside the box.
It came out in the price spreads commission inquiry that manufacturers of cereals were perhaps the greatest users of advertising gimmicks and give-aways at that time. In fact, the commission went to great lengths to establish that the cereal industry was perhaps the greatest user of coupons inside the boxes or the idea of saving box tops in order to get something, all for the purpose of trying to get customers to buy the particular product.
How widespread is this practice? We must determine first whether or not it is of such great importance that the federal government should take action. I have looked at some statistics and referred to previous debates. A survey made in 1959 indicated that 59 per cent of the people of Canada saved trading stamps in those areas where they were offered. These stamps are widely used in the province of Quebec, and in that province 80 per cent of the people saved them and patronized stores that give stamps. Whether it is right or wrong, the people are saving them and using them.
There is the question of whether or not 80 per cent of the people of Quebec can be

Criminal Code
wrong. We may have had some doubts recently whether they are wrong or right in their views, but we must still give them a reasonable amount of credit for being able to judge whether or not they are doing something wrong that is going to harm them and put them in debt, or cost them more money. It is quite an impressive figure when one realizes that 80 per cent of the people in one province where stamps are available save and make use of them. It is also quite impressive that 59 per cent of the people in Canada generally do the same thing.
I come from a rural area and I know that even if trading stamps were lawful in Alberta they would probably not play a very big part in my riding, because we have no large city in the riding and there is no massive amount of trade carried on in one large city. Therefore I am perhaps not aware of the direct evils of this very vicious scheme being carried on by the trading stamp companies. Some of the people who are opposed to trading stamps suggest that the 59 per cent of the people of Canada who use them are not intelligent enough to know when they are being fooled. They suggest that these people become bewildered counting stamps and save them but forget to use them, and so on. They suggest that people who save stamps buy things they do not really need, that they become confused about the value of the goods they buy, that they are dazzled by the advertising in Ottawa, for example, of such stores as Loblaws, where trading stamps are given.
These people who are opposed to the idea think that the people who make use of trading stamps are actually being fooled into thinking that they are getting something for nothing, when they actually are getting nothing and are paying for everything they get. Some of the opponents of this scheme suggest that only those who are in the business of distributing stamps and the goods that the stamps will purchase are in favour of the plan. In my view the fact that 80 per cent of the people of Quebec and 59 per cent of the people of Canada use them suggests that perhaps a fair number of people support the idea of trading stamps.
It might be interesting to refer to my experience on first coming to Ottawa. My wife was soon made aware by neighbours on our street of the fact that she had better deal here or there because this or that store gave away trading stamps and had good premiums. I do not know whether my wife really saved them, but I know that our neighbours in that area certainly did and some of them were not getting stung on what they were purchasing with these stamps.

Actually the matter boils down to the old saying, if I may take hon. members back to the farm for a minute, that you can lead a horse to water but you can't make him drink. This is perhaps very true with regard to trading stamps. You can bring in legislation and force these companies not to issue trading stamps, but will this stop the practice of enticing people to shop at a particular store? Will this do away with box top premiums and all the other gimmicks that advertising men are paid to dream up to try to get around the laws that this and other bodies pass? This is the question.
The hon. member who moved second reading of the bill suggested that there was a loophole in the act, and possibly there might be. But can the loophole be successfully plugged when there is such a wide advertising appeal to various types of customers? I wonder about this point. If the loophole cannot be plugged, and assuming that the people think that it is not right to plug it because they are participating in the scheme, maybe we should not pass the bill at all. I have no really strong objections one way or the other, but there are several question I must ask myself before I am prepared to say that we should blindly accept and pass the bill just because trading stamps have been talked about for 65 years. As the bill suggests, at various times they have been covered under the Criminal Code and at other times not. The bill suggests that perhaps at one time the loophole was plugged but the provision was deleted in 1953 and 1954. I did not have time to look up the debates then and I might not have time to give the house the benefit of my research on the debates in 1953 and 1954, but why was the provision deleted then? That is an interesting question which has gone unanswered so far in this debate. I should like to know the reaction of the house at that time.
What do trading stamps actually do? What are they? If prices are not increased, they are in a sense a discount. I think even the mover of the bill would admit that if prices do not increase they are in a sense a discount to the purchaser of a certain commodity. We are told these stamps represent a discount of something like 2 per cent or 2J per cent on a merchant's gross sales. Actually, I think a strong argument could be presented to show that stamps increase competition. They tend to draw customers from one store to another. This is, perhaps, the sole reason they are used so extensively.
Well, Mr. Speaker, is competition so great that we do not want it increased? Is competition a wrong thing to have between large companies? It has been my complaint in the

last few years that competition has not been keen enough, that some of these large companies tend to follow one another in the setting of prices. I immediately think of the farm machinery inquiry we had a few years ago. In that field one company set the price and others followed right behind. Certainly, there is great scope in dealing with any problem.
The question I am asking here is, do trading stamps not increase competition amongst the larger stores? If they do, is this wrong? This question has gone unanswered so far in this debate. Do we want to see less competition between the larger stores today? Certainly, I want to see more competition because the keener the competition the better the service I am apt to receive as a customer and the better price I am apt to get as a customer. This has been my experience. If that thought is wrong, then certainly there are many things wrong with the trend of thought amongst the economists.
The question might be asked, do trading stamps increase the cost of the commodity we wish to buy? Has it been successfully proven that trading stamps do increase the cost of the products we buy? We have areas in Canada where trading stamps are not allowed and areas where they are allowed. Can it be proven, by looking at the cost of living index for any city in which trading stamps are used extensively that the cost of living is higher than for a city where trading stamps are not allowed? A very interesting comparison could be drawn if such figures could be obtained. Certainly, such a comparison would prove conclusively whether or not trading stamps are evil and should be ruled out by the passage of this particular bill.
As I mentioned before, there are rural areas and perhaps other areas situated many miles from the large chain stores which would not be affected a great deal by this particular problem. However, we must still have an interest in all things that affect the products we need to purchase in order to maintain the living standard we have and of which we think so much. Actually, there is a very interesting brief written by Eugene Beem, entitled "Who Profits From Trading Stamps?". I should like to quote from part of it:
If vendors do not raise their prices when they adopt stamps, consumers enjoy a discount through premiums merchandise equivalent to about 2 per cent to 21 per cent of their stamp store purchases. The typical premium value is about $2.45 per 1,000 stamps, based on a study of the catalogues of ten representative stamp companies and the prices of a large northern California department store. (At discount house prices the value is about 18 per cent lower.)
Business of the House
He goes on to give an idea of the effect they have on prices. I could read from this brief at great length. The author even suggests in this particular chapter that prices are reduced. It is suggested that price reductions may be even spurred. The data gathered by the bureau of labour is a clear indication that stamps have not forced up food prices in general. In fact, this data suggests that stamps may have held down price increases. The author goes on to deal with this thought that stamps may have a tendency to hold down prices. This could be a fact, if one could prove whether or not they are actually increasing competition or decreasing competition.
I believe the question boils down to whether or not we consider profits are wrong. A great deal has been said of late in respect of profits, and opinions have been changing.
I suggest that companies using trading stamps are, in a sense, like giant co-operatives. You are paid dividends in direct relationship to the value of the goods you purchase from the co-operatives. As everyone knows, if you do a certain amount of business with a co-operative you are paid dividends in direct relationship to the amount of business you do.
The question here is, who receives the profit? In so far as co-operatives are concerned, profits are distributed to their consumers. In so far as chain stores are concerned, they naturally keep the profits and distribute them to their shareholders. This procedure is considered all right in most countries, and certainly by most of the parties in this house. In so far as trading stamps are concerned, the stores are distributing dividends to their customers in direct relationship to the amount of goods those customers purchase. If we consider profits are not wrong, then we should allow a company to make a profit, as long as consideration is given to seeing that this profit is not too large. I suggest that, perhaps-


Mr. Speaker:: Order; the time for the consideration of private members' business has now expired.



BUSINESS OF THE HOUSE

Mr. Chevrier:: Mr. Speaker, may I inquire what we will do on Monday, and can the house leader give some indication of what the house will be doing during the whole of next week?

Business of the House Mr. Churchill: On Monday interim supply [DOT]will be the first order, followed by the resolution standing in the name of the Minister of Finance dealing with the national economic development board. This debate, of course, will likely be a major debate and

may go on for several days. I am not able, therefore, to forecast much beyond Monday or Tuesday.


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Monday, November 26, 1962