QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. ILSLEY:: 1.	(a) Are any seaplanes stationed at Eastern Passage, Halifax county, Nova Scotia, under the authority of the government or any department; (b), if so, how many; (c) if not, were any seaplanes stationed there since January 1, 1931, and how many, and for what period?
2.	How many men are employed at Eastern Passage in connection with such planes, or with the station at which they are stationed, including pilots, observers, mechanics and watchmen?
3.	Under the authority of what department or branch of the government's service do such men act?
i.	What was the original cost of the planes which have been since January 1, 1931, or are now, stationed there?
5.	What has been the cost of the maintenance of_ such station at Eastern Passage since the arrival of any planes there?
6.	What has been the cost of transportation of ^planes, men and supplies to such station?
7.	(a) How many government-owned motor cars are attached to such station; (b) how much did they cost, and what has been the cost of their maintenance and operation since their arrival there?
8.	How many persons engaged in smuggling or rum running have been apprehended as a result of the presence at such station of such planes?
9.	Has any property, smuggled or attempted to be smuggled, been seized as the result of the presence there of such planes? If so, what is its value?


PREVENTIVE SERVICE BOATS
Mr. ILSLEY:: 1.	What preventive service boats which were in the .service in 1931, were disposed of in 1932?
2.	What was the age of each of such boats, and the reason for disposing of them respectively?
3.	What disposition was made of each of the boats so disposed of, and in the case of those sold, what was the sale price?
4.	W'hat are the names of the boats acquired by the preventive service in 1932, and what is the age of each boat so acquired?
5.	As to the boats so acquired, were they purchased, leased or how otherwise acquired, and in the case of those purchased, what were the purchase prices respectively?
6.	Have any of the boats acquired this year been conditioned or repaired since being so acquired, and if so, what has been the cost of such conditioning or repairs of each?



MOTIONS FOR PAPERS


Mr. DUFF (for Mr. Urquhart):: For a copy of all correspondence, telegrams, reports and other documents, relating to the
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dismissal in or about the month of February, 1932, of Allan A. Kennedy of Inverness, Nova Scotia, from his position in the Department of Public Works as general repairer to telegraph services.



DISMISSAL OF MR. LOUIS LEMONDE

Mr. SEGUIN (for Mr. Fontaine):: For a copy of all telegrams, correspondence, reports, petitions, and other documents exchanged between the Post Office Department and any persons from July 28, 1930, with respect to the dismissal of Mr. Louis Lemonde, the postmaster at Saint Jean Baptiste, Kouville county; also a copy of all documents in the possession of the government relative to the said postmastership.



GASOLINE PRICES

Mr. REID:: For a copy of all correspondence exchanged between the provincial government of British Columbia and the Prime Minister or any minister of the federal cabinet, regarding the price charged the users of gasoline, between January 1, 1932, and September 30, 1932.



CANADIAN POLICY IN THE FAR EAST

[Stage Direction]
On the orders of the day:
Mr. J. S. WOODSWORTH (Winnipeg North Centre):: I should like to ask the Prime Minister a question which, if he is not prepared to answer today he possibly might answer on a future occasion: What, if any, is the policy of His Majesty's government in Canada in regard to the situation in the far east and to the Lytton report?


Right Hon. R. B. BENNETT (Prime Minister):: I shall be glad to furnish the hon. member with an answer on Monday. Might I say to him that the whole question is sub judice and it is a question of policy which in its entirety I do not think should be communicated to the house at this time.



DISARMAMENT CONFERENCE

[Stage Direction]
On the orders of the day:
Right Hon. W. L. MACKENZIE KING (Leader of the Opposition):: The Prime Minister mentioned two days ago that we would probably receive a report of our delegates to the disarmament conference in the course of a few days. The report was being printed at that time, I understand.


Richard Bedford Bennett: As the right hon. gentleman will
realize, the conference has not yet concluded its labours, but the senior member of our delegation, the Right Hon. Sir George Per-ley, has furnished me with an interim report and I have been discussing with him just what action might be taken upon it. Whether

or not I should lay upon the table the interim report and he should make a short statement or I a long statement is a matter which is not yet settled but which we shall deal with on Monday.	[DOT]



TRADE AGREEMENT BETWEEN CANADA AND THE UNITED KINGDOM

[Stage Direction]
The house resumed from Thursday, November 17, consideration in committee of Bill No. 8, respecting a certain trade agreement between His Majesty's government in Canada and His Majesty's government in the United Kingdom-Mr. Bennett.-Mr. MacDonald (South Cape Breton) in the chair.
The CHAIRMAN:: We were considering
item 409.


Mr. BROWN:: A few days ago I made
some remarks with regard to cream separators, and on that occasion the Prime Minister said that when the explanation was given I would probably be satisfied. I presume that the explanation that was then said to be forthcoming was that given by the Minister of Trade and Commerce yesterday. I can quite understand that the reasons advanced by the Minister of Trade and Commerce were satisfactory to the Prime Minister and perhaps quite satisfactory to both the British and Canadian manufacturers, but surely, Mr. Chairman, we must have failed completely to impress upon the government our point of view if the Prime Minister thinks that the reasons that have been advanced can be satisfactory to us.
The Prime Minister has said that this agreement was based upon and consistent with Conservative policy during the past two years; that is, the policy of protection. We are quite willing to admit that is true, and it is just because it is true that we object to this agreement in general and to this item in particular.
The Minister of Trade and Commerce has told us that there would be no increase in price. His whole argument was based on the assumption that there would be no increase in price, but our objection to this item is that it will inevitably be followed by an increase in price. Just at that point we find the great difference between the position taken by the government and that taken by those on this side of the house. No increase in price? You will notice that the Minister of Trade and Commerce at page 1283 of Hansard said:
First, may I say that Canada will have access to other markets for cream separators. That should be borne in mind.



IS, 1932

[Stage Direction]
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How can we have access to other markets for cream separators when we are imposing a prohibitory tariff against separators coming in from other countries? I submit, Mr. Chairman, that this 25 per cent duty is a prohibitory tariff and will necessarily exclude the separators which are now coming to us from Sweden, Belgium and the United States. So how can it be said that we shall have access to other markets? The separators that are now coming to us from other countries cannot possibly climb over a 25 per cent tariff wall. If the foreigner should attempt to come in over that tariff wall by reducing his price, we know what the attitude of this government would be and has been to an attempt of that kind. It used to be contended that the foreigner would pay the duty.
Mr. CANTLEY:: So he does in many cases.


Albert Joseph Brown: My hon. friend from Pictou says, "So he does," but the government take mighty good care that the foreigner does not pay the duty. If the foreigner tries to put an article into this country at a price lower than it is selling for in his own country and tries to absorb the tariff, this government takes care that that shall not be done. How can the Minister of Trade and Commerce say that we shall still have access to other markets? The contention of the government is that this 25 per cent tariff will not increase the price. Again let me point out as I did yesterday the inconsistency in the arguments of hon. gentlemen opposite. They reduce the duties on cigarettes and liquor, and say that that will decrease the price. Possibly. Then they increase the duty on butter and say that that will increase the price. Then when it comes to barbed wire and cream separators, the imposition of a duty is to have no effect at all upon the price. That is the kind of argument we get from hon. gentlemen opposite. We maintain, Mr. Chairman, in spite of the assertions of the Minister of Trade and Commerce, that this 25 per cent duty will inevitably increase the price.
When some of these items have come before the committee and inquiries have been made as to the reason for the increased duty, the government has not been able to tell us from what quarter came the pressure for these new duties. In this instance we know from where the pressure came. According to the statement of the Minister of Trade and Commerce it came from the Lister firm, which, according to the minister, were the first to introduce cream separators into Canada. Well, possibly that is true. I may be wrong in this point, but I remember a separator known as the Alexandra which, I think, the Lister company introduced. When that separator was first sold in our part of the country one could hear it running a mile away. There may be other separators from England with the details of which I am not familiar.


Mr. STEVENS:: The statement by the
hon. member has been most unfair. Without accurate information under his hand he should not have made such a statement about a business concern.


Albert Joseph Brown: I am simply stating the
fact.


Henry Herbert Stevens: No; the hon. member is
knocking a firm about which he knows nothing. He does not know whether or not his statements are accurate.


Albert Joseph Brown: I am talking about separators introduced forty years ago.


Henry Herbert Stevens: I maintain that the hon.
member has made a most unfair statement.


Albert Joseph Brown: Then, there is another
feature to this matter.


Some hon. MEMBERS:: Oh, oh.


The CHAIRMAN (Mr. MacDonald, Cape Breton):: Order.


Albert Joseph Brown: It is quite evident that one has no difficulty stirring up trouble in committee. I venture to say, however, that hon. members opposite who represent farming constituencies are just as much exercised over this matter as we are-and a good deal more.


Mr. ROWE:: Not one iota.


Albert Joseph Brown: They are exercised not
only from the standpoint of the farmers' interests, but from that of the next election.


William Earl Rowe: Not one iota.


Albert Joseph Brown: I am old enough to remember when Sir John A. Macdonald introduced his national policy. The reason given at that time was that the policy was introduced to protect infant industries. So, down through the years we have listened to the contention that infant industries should be protected. Later we have heard the argument that we should continue protection of decrepit industries. The Prime Minister himself has indicated that possibly there may be certain industries to which, if we had to begin over again, we would not afford protective tariffs. Since those industries have been established however, and in view of the fact that they cannot be continued without protection, he
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proposes to support them. The position now is that while years ago we were asked to protect infant industries, we are now asked to protect inefficient industries.
But this agreement goes much farther than that. It asks us to protect not only infant industries in Canada but infant industries in Great Britain. It asks protection for industries which, perhaps for the reasons the minister lias mentioned, have been unable to supply the Canadian market. Mr. Chairman, I object strongly to that practice. So far as I know the demand has never come from this side of the house, and certainly never from the organized farmers of Manitoba whom I represent, that the British people should tax their food for our benefit. We have never made that demand. Indeed, hon. members on this side of the house have declared definitely that such a demand would not be for the welfare or unity of the empire. Therefore, Mr. Chairman, I think I can quite properly take the ground that we resent any demand from English manufacturers that we should impose an additional burden upon our farmers for the benefit of either a new industry or industries in Great Britain for which there is hope of revival. That is a strain to which we should not be subjected; it imposes on us too great a sacrifice for the promotion of empire unity.
Then there is a further matter that I should like to call to the attention of the minister. As a reason for its acceptance by the committee the minister urged that the changed tariff would help the export trade of manufacturers of cream separators. Ler us grant that that is true. That position however simply confirms us in the opinion we have expressed so frequently during this debate, namely, that this agreement was made not in the interests of consumers but in the interests of manufacturers and producers. Then, there is a further point to be taken into consideration in an agreement of this kind. We have heard a great deal about the demand for fair competition and fair opportunity to supply our own market. Let us see how this change intereferes with the right of farmers to have a fair opportunity in their own market. A few days ago I asked the Minister of Trade and Commerce a question concerning the dumping duties which could be used by other dominions in the event of cream separators being sold there at a price lower than they were sold in Canada. He replied, of course, that nations would have dumping duties when their interests were adversely affected. Of course I expected that answer; perhaps he thought my question was

foolish. Nevertheless there is sometimes method in what appears to be madness.


Henry Herbert Stevens: Hear, hear.


Albert Joseph Brown: The point I wish to bring out is that we are brought into competition with other producers of dairy products. We are told again and again that in the production of butter New Zealand has natural advantages over Canada. That is perfectly true. But that is no reason why, in addition to those natural advantages, New Zealand should have a further advantage over us brought about by an act, not of their own but of our government, and one which places us at an artificial disadvantage. I do not know what the duty on cream separators in New Zealand is, I have not had time to look up the information. But I venture to say that in a country Like New Zealand, whose products enter into competition with ours, their farmers, are not unduly handicapped by duties on cream separators. There may be small revenue duties, but I venture the assertion that farmers in that country are not handicapped by a heavy duty on cream separators; I venture the same assertion in regard to South Africa; I venture the same assertion in regard to Denmark. This last mentioned country is perhaps our chief competitor, at least one of our chief competitors, in dairy products in the British market. I venture to assert that the farmers of Denmark are not unduly handicapped in their business by duties placed upon cream separators.
This, Mr. Chairman, is an additional reason why we should oppose this item in the schedule, and why we lay so much emphasis upon it. Perhaps hon. members from other parts of the dominion, representing other industries, may not realize as much as we do the seriousness of this item. I do not think there is anything in the whole agreement which, from the standpoint of the great primary producer in Canada, is as objectionable as this most iniquitous tariff against cream separators.


Mr. BEAUBIEN:: Mr. Chairman, were I not to voice my protest against this item I should be neglecting my duty. Yesterday the minister stated that a man named Lister came into his office and intimated to him that Great Britain could supply cream separators to Canada. I have information before me from a firm doing a large business in cream separators in western Canada. Any information I have received previously from this firm has been authentic. In this instance their statement is that Great Britain does not make the cream separators, so-called, that farmers

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need for the separation of milk from cream. If the information this firm gives me is correct, and I feel certain it is, because the importations from Great Britain have been nil, we can arrive at no other conclusion than that the Canadian producer of dairy products will pay the extra duty of 25 per cent. The hon. member for Lisgar (Mr. Brown) mentioned that the reduction in excise on cigarettes and liquor had resulted in reduced prices. I can verify that, being quite a cigarette smoker myself; every time I buy a package of cigarettes I make a nickel.


An hon. MEMBER:: You will make a lot
of money!


Charles-Philippe Beaubien: So if it works that way when the excise or duty is reduced it must work the other way when the duty is imposed or increased.
The information in this letter is, in part as follows:
About eight or ten months ago I saw a financial statement of an English company which manufactures and distributes butter and other dairy products and the statement also mentioned that they manufactured dairy and creamery equipment. I wrote for prices on cream separators and was told that they made only heavy power separators for creamery use and that the small separators for dairy farms were imported from Sweden.
I think it a great mistake to cut off the competition between domestic, American, Swedish and other countries in the matter of such a necessity of production as cream separators. We find that farmers are not able to buy separators now and complain that the cream cheques are so small that they cannot pay for the ones we have sold them.
I know of only two Canadian makes, the Renfrew, made in Renfrew, Ont., and the Massey-Harris, which, I suppose is made in Toronto.


Mr. RYCKMAN:: What about De Laval?


Charles-Philippe Beaubien: He says he does not
know whether De Laval separators are made in Canada or not, but he knows that a few years ago De Laval imported separators into Canada and sold them to Canadian dairymen.


Henry Herbert Stevens: What is my hon. friend
quoting from?


Charles-Philippe Beaubien: I am quoting a letter
from a firm which does a large business selling separators to farmers in western Canada.


Henry Herbert Stevens: We would be better able to judge of the information if we had the name of the firm. I think we are entitled to the name. I gave my authority yesterday.


Charles-Philippe Beaubien: I expected that from the minister, and I am prepared for it. I am 53719-82
doing exactly what the minister and the right hon. Prime Minister have done; they read letter after letter without giving names. The Prime Minister even read a letter last year from a lady who commended him for reducing civil service salaries, and when he was asked to give the name he would not give it. I am just as much entitled to the privilege. The quotations I have given are from a letter from an authentic firm; any information they have given me has proved to be correct.


William Earl Rowe: Do they manufacture- in Canada?


Charles-Philippe Beaubien: I am glad to see my hon. friend from Dufferin-Simcoe (Mr. Rowe), smile. If my hon. friend from Dufferin-Sim-coe and my hon. friend from Haldimand (Mr. Senn), think they are going to play the same trick on the farmers in the next election, they are badly mistaken.


Finlay MacDonald: Order.


Charles-Philippe Beaubien: Well, I will withdraw the word trick," I will just say " playing the trick." I know my hon. friend from Dufferin Simcoe is too intelligent to broadcast to the farmers the imposition of this duty on cream separators. Now, Mr. Chairman, the purpose of these agreements is what? Nothing else than to benefit the manufacturing industries of this country. The producers and consumers of creamery or dairy products have never been consulted. The only people that have been consulted are English or Canadian manufacturers. That is what I say in western Canada and in all other parts of Canada. I ask of my friends from the eastern townships, where I spent my last week-end, those friends of mine from the eastern townships who slid into power on a pound of New Zealand butter: Are you going to tell your farmer friends who voted for you on that question that the government has done the very thing which is going to hamper the dairy industry to a greater degree than it is hampered today? In western Canada we are getting anywhere from 13 to 15 cents a pound for butter, and the minister and the government have to admit that the only reason for imposing this duty, if there is a reason, is either revenue or to protect the industry. When the duty becomes so high it ceases to bring revenue to the country, but it increases the price to the man who has to buy the commodity.


Mr. MULLINS:: May I ask the hon. member, if the price of cream separators has increased? Is not the Massey-Harris separator as good as any in the country? I have had one for forty years.

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Imperial Conference-Trade Agreements


An hon. MEMBER:: That is one of the old Listers you have got.


Charles-Philippe Beaubien: I am not concerned whether the price increased yesterday or today-


Some hon. MEMBERS:: Oh, oh.


Charles-Philippe Beaubien: -but let me warn my hon. friend from Marquette (Mr. Mullins) that he will never be able to go back to his county, with that cream can and the old cow, if he tells the people that the party that he supports, has increased the production costs of the dairyman. I know my hon. friend objects to this, but I can say, with all the respect I have for him, that if he goes back to the constituency of Marquette and repeats the argument he made in 1930 the old cow will not bawl, she will cry.
Now, Mr. Chairman, I plead with my farmer friends on the other side of the house, who in 1930 asked the farmers to support them; I plead with my personal friends from the eastern townships who I know contributed a great deal to the belief of the farmers that the Bennett government would give everything to the dairy industry and all would be well; I plead with these friends of mine now, and others, to stand up in this house and fight for the farmers' interests, knowing that if the farming industry does not become prosperous nothing will prosper in this country. As a final plea I ask my hon. friend from Dufferin-Simcoe, one of the best-looking men in this house, a man who is always smiling-I am only sorry he is not the Minister of Agriculture, because he is one of those back-benchers who would make a good Minister of Agriculture-to stand up in this house and tell this government that if they are going to impose these penalties on the farming industry, and especially the dairy industry, he is not going to support any such project.


Mr. RHODES:: The hon. member for Lisgar and the hon. member for Provencher each have made the bald statement that there will be an increase in cost, and they have based their whole complaint against these provisions upon that assumption.. If the cost is not increased then their argument is worthless.


Charles-Philippe Beaubien: Then why the duty?


Edgar Nelson Rhodes: The duty is for preference and for empire free trade in cream separators. Let me say this to my hon. friends: I take it that if they could get a separator at a given price they would prefer to buy it within the empire rather than without. They must assent to that position, otherwise they must take the ground that they prefer to buy from without rather than within the empire.


Charles-Philippe Beaubien: May I interrupt the
minister to tell him that if present conditions continue the farmers will not have money with which to buy separators from anyone.


Edgar Nelson Rhodes: I only wish to say that I
do not assent for one moment to the proposition that these proposals will result in an increase in the cost of separators. We will find very fierce competition on the part of the British now that they have an opportunity in this market. But there is one point to which hon. gentlemen have not made reference; for many years past, with the exception of the bowl, every part imported for servicing cream separators had to pay a substantial duty, and under the provisions of this agreement these parts now come in free.


Charles-Philippe Beaubien: From where?


Edgar Nelson Rhodes: From within the empire.


Charles-Philippe Beaubien: But they do not come
in free from the United States or Sweden?


Edgar Nelson Rhodes: Just wait one second.
Under the tariff which was supported by my hon. friend from Provencher, when parts came in they were assessed at varying duties. For example, if made of iron or steel they would be dutiable under item 446, under which they paid 15 per cent under the British preference, 27| per cent under the intermediate and 35 per cent under the general tariff. If made of aluminum they paid 15 per cent under the British preference, 22! per cent under the intermediate and 25 per cent under the general tariff. If they were nickel plated they paid 30 per cent under the preferential tariff, 37! per cent under the intermediate tariff and 45 per cent under the general tariff. If made of copper or brass they paid a duty of 20 per cent under the preference, 27! per cent under the intermediate and 30 per cent under the general tariff. Now those preferential duties have been all swept away, and those parts can come in free.


Albert Joseph Brown: I suppose the Minister of
Finance expects us to accept that argument as a valid reason for supporting this agreement. Probably the minister is stating the facts accurately with regard to the duty on imported parts, but supposing that tariff was in effect under the Liberal government, as he has suggested, and supported by members on this side of the house, is that any reason why the duty now should be imposed upon the complete article? Surely not. It does not make his case any better or our case any worse.


Charles-Philippe Beaubien: Certainly I am not going to let my genial friend the Minister of Finance get away with that. The minister is

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trying to impress upon the house the wonderful service being rendered the farmers of Canada by this government through the removal of the duty on cream separator parts. If his argument is sound; if it helps the farmers to take the duty off the parts, why put a duty on the finished article? Truly I cannot understand that reasoning. The government takes the duty off cream separator parts and gives that as an action that will benefit the consumer of cream separators. On the other hand it puts on a duty of 25 per cent on the finished article. I cannot understand that logic. Perhaps my brain is not working well this morning, though I went to bed fairly early last night.


Henry Herbert Stevens: I confess that it is very
difficult to follow the reasoning of some hon. gentlemen opposite. I suppose that one of the difficulties of our form of parliamentary procedure is-


Charles-Philippe Beaubien: The present government.


Henry Herbert Stevens: There we have another
illustration of it. It is simply impossible for us to reason out these things in a logical way and, shall I say, according to the facts, without interjecting partisan politics. I am not saying that my hon. friends opposite have a monopoly of this.


Some hon. MEMBERS:: Oh, oh.


Henry Herbert Stevens: I quite agree with that.
So that my hon. friends will not accuse me for the next five minutes at least of being partisan, I grant that they have not a monopoly of that weakness or that fault, which is perhaps inherent to our system, but I should like to invite hon. gentlemen now to concentrate for a moment, in a logical way, upon this question.


Albert Joseph Brown: You have not a monopoly of logic, either.


Mr. POWER:: It is no use.


Henry Herbert Stevens: I grant you it is not. I
did not expect my hon. friend from Lisgar to interject a provocative statement at that moment. Can he not at least receive in the proper spirit the attempt I am making to approach the question from a business standpoint?


Albert Joseph Brown: I do not think the minister will say that in my remarks I did anything but attempt to argue the question on valid, sound premises.


Henry Herbert Stevens: I did not name my hon. friend; I have been talking in generalities. I 53719-82*
am inviting the whole committee to consider this question from a logical standpoint rather than to allow our prejudices to interfere. I imagine it is hopeless, but I will go on. There are certain facts which I think the committee must bear in mind. The first is that as far as cream separators are concerned we now have free trade, if I might use that term, within the empire. That is, as far as Canada is concerned we have free access to the markets of the empire. That is of some value to Canada. I cannot agree with hon. gentlemen opposite when they suggest that we must look askance at some advantage to the industrialists of Canada. I think it is a desirable and commendable thing if that is secured. That is my position, and that is point numbei one.


Mr. STEWART (Edmonton):: Before the
minister leaves that point may I inquire if there ever has been any obstacle in the way of trade within the empire?


Henry Herbert Stevens: Yes; practically every
part of the empire had a duty on cream separators. Now we have free entry to those markets. Just on that point let us consider for a moment precisely what was the argument advanced by the Minister of Finance a moment ago. Let us look at this matter calmly and dispassionately. There have been duties. I am not blaming my hon. friends opposite at all, but as a matter of fact there have been duties on parts. The hon. member for Provencher asked a question which I think was very proper, but which I also think is very capable of being answered. He askf what that has to do with putting a duty or the finished article.


Charles-Philippe Beaubien: I did not say that.


Henry Herbert Stevens: I think I caught my hon friend correctly. He asked, if it was desirable to take the duty off parts, whether that was not a sound reason for taking the duty off the finished article.


Charles-Philippe Beaubien: No, that was not what I said. I took it that the Minister of Finance was arguing that the removal of the duty on parts was a benefit to the farmer. Then, if his argument was sound, I asked why the duty should be put on the finished article.


Henry Herbert Stevens: Quite so; that is what I had in mind, only I left out the word "farmer." That is quite right. There is an anwer and, I think, a valid answer to that. The manufacture of cream separators in Canada has been carried on by three firms for a very considerable number of years, but a substantial
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part of that manufacturing has been in the way of assembling. In nearly all industries there are some parts of machinery that can be made better elsewhere, because of the quantum factor, and such parts are brought in. Such items as bowls and some other things have been brought in as finished part3 and assembled with the other parts of Canada. Now, by the step we have taken in removing the duty from Great Britain at least on all these parts, we are contributing something towards lessening the assembling cost in Canada. That is axiomatic and I think it will be accepted in the discussion of industrial development.


Charles-Philippe Beaubien: If the taking off of the duty on parts that are made in foreign countries is an advantage to the cream separator producers in Canada, would it not work just as well if there were no duty on cream separators to the farmers?


Henry Herbert Stevens: If my hon. friend will follow me I will try to make that point clear. In the first place, the cream separator as such does come in free from Great Britain and remains free. But parts for repairs also come in free from Great Britain under the new arrangement we are making. If any large distributors wish to bring in repair parts- and I fancy that in all machinery there are certain parts that wear out before others do and consequently have to be brought in-* they will have those free from Great Britain; and they were not free before. Now, there is some compensation from that standpoint alone for the imposition of the duty on the finished article.


Mr. EULER:: Was any substantial quantity of parts brought in from Great Britain before?


Henry Herbert Stevens: I gave the list last night.


Charles A. Stewart: In the list of imports which the minister gave last night are parts included?


Henry Herbert Stevens: I will have that in a moment. I am informed that the only parts that can be traced are bowls, of which some $24,000 worth were imported.


Charles A. Stewart: A list of imports was given last evening. Does that list include parts?


Edgar Nelson Rhodes: Separators came in to the value of $455,000, and bowls, which have always been free, came in to the value of $24,000.


Henry Herbert Stevens: I would ask my hon. friend from Provencher, who I am glad to see has responded in a very nice spirit to my advances, to follow me.


Charles-Philippe Beaubien: My response is just until you finish your argument.


Henry Herbert Stevens: That is quite all right. At least I appreciate his temporary courtesy. There is this point which I would ask him and other hon. members to consider. In his remarks the hon. gentleman seemed to labour under the impression that there was in this nothing of any value for the farmer-that is, in the agreements or in our trade with Great Britain as represented in those agreements. Nothing at all. Well now, I invite him to consider this point. We are clear that under these agreements there are, for the producers of butter, cheese, powdered milk and so forth, all those things that are indigenous to the dairy industry, very definite and valuable preferences in the British market. The representatives of the British people say, "We are giving you these valuable concessions for your dairy industry in our market. Is it therefore not reasonable for you to give us a chance in your market with some of the machinery we produce and are able to supply you with?" That is not an illogical position to take; I submit that it is sound.


Charles-Philippe Beaubien: But I submit that you are putting under a handicap the producers of that very commodity on which you have a preference in Great Britain.


Henry Herbert Stevens: No. That is where my hon. friend is in error, I think. He and the hon. member for Lisgar as well as the hon. member for Weyburn, in all their arguments, assume that at once there will be an increase in the price of cream separators.


Albert Joseph Brown: We do not assume that the increase will be at once-put it that way.


Henry Herbert Stevens: Well, the assumption is that as a result of this there will be an increase in price.


Albert Joseph Brown: Put it that way.


Henry Herbert Stevens: But that does not follow at all. I showed last night that we were importing, for instance, from the United States and from Sweden large numbers of cream separators. Now, if we can increase production in Canada and absorb part of that, if we can give to Great Britain part of that business, does it not follow that there is likely to be a reduction? As a matter of fact I am told that in all probability there will be a reduction in the cost of production and therefore in the price of cream separators, as a result of increased production on the one hand and on the other-


Mr. VALLANCE:: The minister points out the advantages which the farmer of Canada gets in the British market for farm products.

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He will admit tha/t we have to take world prices for those products. Has he the same assurance from the cream separator importers from Great Britain that their commodity will be sold at world prices?


Albert Joseph Brown: Mr. Chairman-


Henry Herbert Stevens: I am not through. I am sorry to continue the discussion, but I can see that it is likely to be lengthy and I think we ought to try to make these points clear. The argument I submit may not be accepted, but I submit it and appeal to the reasonableness of my hon. friends. I submit that with an increase in production through this tariff against the foreigner the chanices all are that the Canadian separator will be produced at a lower cost, and we have then the competition of the British cream separator manufacturer which we must not disregard.


William Daum Euler: I do not quite appreciate the consistency in saying that the production of the Canadian manufacturer will be increased and at the same time stating that there will be stronger competition from Great Britain. The two things do not seem to be consistent.


Henry Herbert Stevens: I will give the statistics on which I base that statement. Let us take any year you like-the year 1931 for instance. In that year we imported from Sweden 5,218 cream separators; from Finland 916; from the United States 14,763, and from Belgium 2,683, or total imports amounting to 23,838. Our production was only 8,000. Suppose we divided that between Great Britain and ourselves-let us assume that for the sake of argument: that would give 12,000 additional to Canada; and if Canada gets 12,000 additional cream separators to produce, my hon. friend knows, and none better in this house, that we shall have a corresponding reduction of overhead charges.


William Daum Euler: My hon. friend's contention is that the business which has been going to foreign countries like Sweden will go to Great Britain without diminishing the output of the Canadian producer.


Henry Herbert Stevens: I think it will result in a marked increase in Canadian and British production. I am quite clear on that point.


Charles-Philippe Beaubien: And a lower consumption owing to the price.


Henry Herbert Stevens: 
Mr. MOTHERWELL:: What	are they
meant to prove?


Henry Herbert Stevens: I am just giving that by		
wav of information; the	remainder of the	
articles are practically all dutiable.		The list
continues:		
	1931	1932
Grain products:	Cwt.	Cwt.Bran, shorts and middlings	46,841	950,124Barrels	BarrelsFlour of wheat	1,287,443	1,380,791Pounds	PoundsMacaroni and vermicelli	281,307	662,448Cwt.	Cwt.Oilcake and meal. . .	24,640	66,851Tobacco, unmanufac-	Pounds	Poundstured	1,511,556	3,828,261Animals and Animal Products	Pounds	PoundsHoney	354,100	1,259,994Meats:	Beef, fresh, chilled or	Cwt.	Cwt.frozen	4,480	9,990Bacon and hams. . . .	50,461	217,207Pounds	PoundsCanned meats	7,628	333,645Pork, fresh, chilled or	Cwt.	Cwt.frozen	1,765	8,142Pork, dry, salted. . .	145	17,672Poultry, dressed or un-	Pounds	Poundsdressed	48,441	225,1101294	COMMONS
Imperial Conference-Trade Agreements
Animals and Animal Products-Cone.
Milk, condensed, powdered	Cwt.	Cwt.and evaporated. . .	42,788	96,402Oils, fats, greases and waxes:	Cwt.	Cwt.Animal oils, n.o.p .. .	88	16,001Gallons	GallonsFish oil, n.o.p	8,551	163.081Cwt.	Cwt.Grease and grease scraps	5,068Lard compounds. . . .	ii	1.086Tallow	2,766	4,679Fibres and Textiles:	Doz. Prs.	Doz. Prs.Socks and stockings. .	1,851	14,775Pounds	PoundsWool, raw	1,333,118	2,057,714Wood Products and Paper:	Cwt.	Cwt.Wrapping paper, kraft.	8,563	14,777M.Feet	M. FeetPlanks and boards. . .	74,380	122,691Timber, square. . . .	15,826	16,574Cwt.	Cwt.Wood pulp	377,320	507,923Iron and Its Products:	Typewriters and parts.	124	8,467Automobile, passenger.	194	794Non-Ferrous Metal Products	Copper, bars, rods,	Cwt.	Cwt.sheets, etc	91,093	454,989Lead in pigs, refined	lead, etc	513,078	765,130Non-Metallic Mineral Products:	Abrasives, artificial,	Cwt.	Cwt.crude	25,303	19,653Coal tar and pitch. .	Gallons 726,249Chemicals and Allied Products:	Pounds	PoundsCobalt oxides and salts.	87,500	151,500Miscellaneous Commodities:	Refrigerators and parts.	159	27
Those figures indicate that in these trying times our trade with Great Britain is expanding and has expanded since the preferential duty arrangement was made last April. We are contending that because of our obvious experience in this matter these schedules which are now being submitted will prove to be beneficial to trade between Canada and the United Kingdom. We ask hon. gentlemen to view this matter from the broad standpoint of the welfare of both countries. We are quite satisfied that the economics of the thing will demonstrate that there is advantage in this to the Canadian manufacturer, in that he gets his parts free; there will be protection to the Canadian consumer, in that he has the competition of the British Empire in cream separators and incidentally he receives the benefits of a chance- of "increased production with lowered overhead, which we contend must inevitably result in a reduction in price.
I desire to say one word to the hon. member for Lisgar (Mr. Brown). I am sorry he has sought to cast reflection upon such a reputable British firm as the Lister company.
[Mr. Stevens.1


Albert Joseph Brown: I operate one of their
machines at home.


Henry Herbert Stevens: My hon. friend said he
did not know whether or not it was their machine.


Albert Joseph Brown: It was one sold by the
Lister company, I presume during the time they were not manufacturing.


Henry Herbert Stevens: My hon. friend said he
has had it for forty years and that it runs like a threshing machine. I ask him, is it fair to cite the name of one of the most reputable firms in Great Britain and refer in argument to the standing and excellence of its products? Is it fair to take advantage of one's place in parliament to cast reflection upon their products merely for the sake of bolstering up an argument? Is that fair game? Why is it, when my hon. friend comes to a British or Canadian manufacturer, he begins to suspect? Why is it that all foreign manufacturers are beyond and above suspicion in his mind? Why is it that my hon. friend in all his arguments will insist that there is some sinister motive behind Canadian industry? I say to him, and I know there are hon. gentlemen opposite who have had wide experience in these matters who will corroborate me, that by and large the Canadian businessman, the manufacturer or distributor is a man of ethics equal to any in the world. It may be that in this country, as in all countries-I am glad to say it is disappearing-there are individuals who will take advantage of this, that or the other and not be what we call fair traders. It is most unfortunate that such an impression Bhould go abroad in connection with the Canadian manufacturer. When you look at both sides of the various problems with which they are confronted, when you hear the stories which I get every day, when you get the other side, in ninety-nine cases out of one hundred justification is found for the position taken.
In my estimation parliament ought to take pride in the industrial development of this country. We should take pride in that development, because as the Prime Minister intimated yesterday, every industry which is made successful means further assistance to the primary producer, the farmer, the lumberman and the miner. We must not forget that there is also mineral and lumber production which is equally meritorious to that of farm production. When I say that I am not trying to disregard the rights of the farmer because I am just as anxious as any hon. member of this committee to see him prosper. I know his difficulties, I sympathize with his burden of debt and the low commod-

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ity prices which he receives. I know his problems are almost insufferable, but this condition does not apply only to the farmer, it is applicable also to the lumber and mineral producers. Let us as Canadians in this parliament give to the Canadian industrialist, the manufacturer, the manager and the tens of thousands of workers at least the credit that they are good Canadian citizens and entitled to every consideration. We should not always base our arguments upon the implied assumption that there is something wrong with the industrialist of this country and something sinister in his motives.


Albert Joseph Brown: I thank the Minister of Trade and Commerce for the lecture he has given this committee in general and me in particular. I did make reference to a machine which was imported forty years ago, and I said it ran like a threshing machine. I have not the slighest doubt that the English manufacturers and the Canadian manufacturers have since that time improved their product to a very great extent. So that was no reflection on the present capacities of the Lister Company. But the fact of the Lister Company coming to our Canadian government and asking them to impose a 25 per cent duty on cream separators is not calculated to foster better relations betwen the different parts of the empire, and I have no hesitation in saying that. In all of this debate I have never seen fit to criticize the British people for doing what they saw fit to do. Indeed, I have always resented the idea that we should try to impose upon them the conditions of their fiscal policy. I have consistently taken the ground that they should do what they thought fit, and I have made no complaint up to this time of the attitude of the British government or of any British industry. But when it is stated that a British manufacturer comes to Canada and asks to have a 25 per cent duty imposed-


Edgar Nelson Rhodes: If my hon. friend will permit me just a word, because I presume he desires to have his facts right, the British manu-faturer did not come to Canada and request that a duty be placed on cream separators. The manufacturers of cream separators in Canada did not know and had not the faintest idea of the proposals in question until they saw them published in the press. This item was included in the list solely because it was a concession which we felt we could grant in view of the circumstances and the fact that the British government laid particular stress upon it as one item which they deemed of importance.
Mr. BROWN Supposing the facts are as
just stated-


Edgar Nelson Rhodes: They are.


Albert Joseph Brown: It does not alter the fact. The Minister of Trade and Commerce when he presented this matter to the house laid great emphasis on the fact that the R. A. Lister Company wished to get into the cream separator business in Canada. The manner in which those negotiations were carried on is a matter of complete indifference to us, but the fact remains that in order to benefit the British manufacturer a duty of 25 per cent has been imposed on cream separators.
The Finance minister complains that we base our argument on the assumption that prices will increase. We on this side are just as much warranted in that assumption as is the government in its assumption that prices will not increase. There is the wide difference between the two sides of the house. Hon. gentlemen opposite maintain that protective duties do not increase prices; we maintain that they do, and the country may just as well know that that very vital difference exists between the two sides of the house.
In regard to the duty on parts, on which the Finance Minister and the Minister of Trade and Commerce have laid emphasis, under the tariff which was in existence up to September, 1930, item 442b provided:
Materials which enter into the construction and form part of cream separators when imported by manufacturers of cream separators, for use exclusively in the manufacture of cream separators, in their own factories, under regulations prescribed by the minister . . .
shall enter free under the British preferential, the intermediate and general tariffs.
And 442c:
Articles of metal wrhen imported by manufacturers of cream separator parts for use exclusively in the manufacture of cream separator parts, in their own factories, under regulations prescribed by the minister . . .
shall enter free under all three tariffs.


Edgar Nelson Rhodes: While my hon. friend is
upon that point, will he allow me to enlighten him? AVhat -was done under the law which was supported by my hon. friend from Lisgar was this, that when the manufacturer wanted to import his parts he got them in free, but when the poor, lowly farmer on the plains imported his parts for repairs under the British preference he paid all the way from 15 to 20 per cent. My hon. friend must bear that fact in mind when he criticizes us for taking care of the manufacturer and neglecting the farmer.
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Mr. WEIR (Macdonald):: Item 409 in this agreement provides free entry under the British preference and a 26 per cent duty under the intermediate and general tariffs. I understood the Minister of Trade and Commerce a few moments ago to indicate that the old tariff on parts for separators was higher than the new tariff listed here, but I do not see any change. Will the new tariff apply to all parts? I see that bowls are mentioned.


Edgar Nelson Rhodes: Any part which goes into
a cream separator can now be imported under the British preference free, any component part whatsoever that is wanted by the farmer for repairs. Prior to this agreement, although cream separators themselves were free across the board the manufacturer could import any part he wanted duty free, but when the farmer wanted to import a repair part he paid a duty, if it were made of iron or steel, of 15 per cent under the British preference, 27| intermediate, and 35 per cent general; if of aluminum, 15 per cent under the British preference, 221 per cent intermediate, and 25 per cent general; if nickel-plated, 30 per cent under the British preference, 37i per cent intermediate, and 45 per cent general; if of copper or brass, 20 per cent under the British preference, 27j, per cent intermediate, and 30 per cent general.


Mr. COOTE:: Will repairs coming in from other countries than the United Kingdom pay the same rate of duty as they do now?


Edgar Nelson Rhodes: If the machines were imported from a foreign country they would pay 25 per cent under this arrangement as compared with 45 per cent, if nickel-plated, under the old tariff; if of iron or steel, 35 per cent under the old tariff and 25 per cent under this tariff; if of aluminum 25 per cent under the old general tariff, and 25 per cent today; if of copper or brass, 30 per cent under the old general tariff, and 25 per cent today.


George Gibson Coote: 
Edgar Nelson Rhodes: I would prefer that that question be answered by my colleague the

Minister of National Revenue. My hon. friend will remember that a bill has been brought down to amend the Customs Act having reference to section 43.


George Gibson Coote: I do not think this matter
refers at all to section 43. What I am trying to find out is whether we can bring in cream separators from England and pay the actual rate of exchange for the British pound existing at the time of importation, or whether we will be compelled to pay duty which will be the equivalent of the difference between the rates of, say, $3.70 and $4.87 on the pound. I think that is a very important point.


Henry Herbert Stevens: If I may, I will answer
the hon. member in two ways. First, so far as the present situation is concerned, if an item on the free list is imported into Canada today it will pay a special exchange adjustment duty. That is one answer. Does my hon. friend understand that?


George Gibson Coote: That will apply to cream
separators.


Henry Herbert Stevens: Yes. But under article 17 in the agreement there is this understanding by the government of Canada:
They further undertake to give sympathetic consideration to the possibility of reducing and ultimately abolishing the exchange dumping duty in so far as it applies to imports from the United Kingdom.
I state very frankly to my hon. friend that the government is very carefully studying this matter. Its experts are now working on it, and we are trying to solve what is admitted by all to be one of the most difficult problems confronting the different countries of the world today. So while my first answer is accurate, so far as the present day conditions are concerned we are hoping and intending, so far as lies within our power, to get away from that exchange dumping duty or, as it is sometimes called, exchange adjustment duty.


George Gibson Coote: I have a further question. I presume the three per cent excise tax will apply on cream separators, and also the dumping duty the minister has just mentioned. Will they be the only duties collected on cream separators imported?


Henry Herbert Stevens: Yes. The excise tax is
a revenue tax applied practically to everything.


John Vallance: Mr. Chairman, up until the introduction of this agreement with the United Kingdom, Canada was a world market for cream separators. I think the minister

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agrees with that statement. Now there is the proposal to restrict that market. Some time ago I asked the minister a question when he was pointing out that today we had a market in Great Britain for farm produce. I pointed out to him, as he well knows, that that market was only assured to us provided we would take the world price. In view of the fact that we have now closed this Canadian market as a world market,-at least, that in my view is the intent of this agreement-and that we will create in Canada a market for empire goods, and among others cream separators, I ask the minister, have we the same assurance from the other portions of the empire that we will be able to buy these cream separators at the world price? Before I take my seat I should like to say to the Minister of Finance that the farmer himself very rarely imports repair parts into this country, unless he has an implement or cream separator not sold or manufactured here. The manufacturers and dealers who sell separators in Canada always carry the parts. We may take a De Laval, a Massey-Harris or any other separator or, for that matter, Swedish separators, and find that in connection with each we can* readily buy repair parts from those who either sell or manufacture the machines, or assemble the repair parts.
No doubt the minister will tell me that there are pirate dealers throughout Canada who make a business not only of selling machines but the repair parts for machines they do not sell. No doubt the Minister of Finance will say that the tariff on repair parts he was talking about was designed to get at those pirate dealers.
I should like the Minister of Trade and Commerce to answer this question: Have we the assurance from the other dominions and the mother country that cream separators will be sold in Canada at the world price, in view of the faot that we have to deliver our products to their markets under a similar condition?


Henry Herbert Stevens: The hon. member has touched upon a number of points. In the first place, the dealers handling parts to whom he referred paid the duty on those parts, just the same as anybody else would. Presumably that duty would be included in their price, so that it might be passed on. No doubt they would deal with it in whatever way they thought best. The faot remains however that they woud pay the duty on the repair parts; I should like to have that point clear.


Charles-Philippe Beaubien: That is not what the Minister of Finance said.


John Vallance: We will suppose that an agent in western Canada, or any other part of Canada, handles Massey-Harris separators, and obtains repairs from their plant in Toronto. Massey-Harris does not pay the tariff; therefore the farmer buys without a tariff.


Henry Herbert Stevens: Of course, if it is a Canadian product it does not carry a tariff; that is clear. But repair parts that are imported, whether by a manufacturer, a dealer or anyone else, are subject to duty. The only time they are not is when they are imported for incorporation in an assembled machine. There is no question about that.
Then I shall direct my remarks to another point made by the hon. member. He said that we Canadians have guaranteed to Great Britain that we will sell our farm produce at the world market price. We have not done that at all.


John Vallance: What about the agreement?


Henry Herbert Stevens: That does not apply to butter, cheese, milk or those other commodities about which we are now talking. A world price is not guaranteed on those items.


John Vallance: Why not?


An hon. MEMBER:: There is a duty on them.


John Vallance: "Duty" nothing.


Henry Herbert Stevens: I shall read article 4:
It is agreed that the duty on either wheat in grain, copper, zinc or lead-
Those are the four commodities, namely, wheat, copper, zinc or lead-

as provided in this agreement may be removed if at any time empire producers of wheat in grain, copper, zinc and lead respectively are unable or unwilling to offer these commodities on first sale in the United Kingdom at prices not exceeding the world prices.
And so on. So, as far as dairy products are concerned-cheese, butter, condensed milk, powdered milk-we come under such undertaking. Cream separators are precisely on the same basis as butter, cheese, milk or any of the commodities I have mentioned.


John Vallance: The minister will agree that they give us ten per cent and we give them 25 per cent.


Henry Herbert Stevens: No.
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John Vallance: Yes we do. We give them 25 per cent on cream separators, and on farm produce they give us ten per cent.


Henry Herbert Stevens: We get 15 per cent on cheese, 15s per hundredweight, specific, on butter; on condensed milk, whole, sweetened we get 5s per hundredweight, and 20 per cent on other milk products.


John Vallance: We have no assurance that the price of cream separators obtained from them will be the world price.


Henry Herbert Stevens: No more than we have given such assurance on the farm products to which I have just referred.


William Gilbert Weir: Would the minister give us the rate of duty against Swedish separators coming into Canada? I have had occasion to look into the purchase of separators.


Henry Herbert Stevens: Does the hon. member ask for the proposed duty? It is 25 per cent.


William Gilbert Weir: The rate prevailing before.


Henry Herbert Stevens: They came in free before.


Mr. SPENCER:: I understood the Minister of Finance to say that repairs were coming in free. Do I understand the Minister of Trade and Commerce to say that they come in free only when they are to be assembled in a machine?


Henry Herbert Stevens: By a manufacturer in his own plant. Does the hon. member ask about the arrangement under these provisions?


Henry Elvins Spencer: Yes.


Henry Herbert Stevens: No, they do not come in free.


Henry Elvins Spencer: Not even from British countries?


Henry Herbert Stevens: They oome in free under the British preference.


Henry Elvins Spencer: There will be a tariff on repairs from foreign countries.


Henry Herbert Stevens: Yes, twenty-five per cent, in contradistinction to the rates charged previously, which were all higher.


Charles-Philippe Beaubien: Under the old tariff the repair parts imported by assemblers or manufacturers of cream separators came in free?


Henry Herbert Stevens: No. I thought I had made that clear. Any part that was brought in for repairs, whether by a manufacturer, a dealer or a private individual, bore the duties which we have indicated. They were higher than they are under this arrangement.


Charles-Philippe Beaubien: They will have to pay duty now?


Henry Herbert Stevens: They will pay now 25 per cent, instead of 30, 37, 45 and so ont But free from Great Britain.


Mr. YOUNG:: Could the minister tell us what rate of duty Great Britain is imposing on cream separators from the outside world.


Henry Herbert Stevens: Twenty per cent, and free as far as Canada is concerned.


John Vallance: According to the figures for the period 1910-1932, given last night by the Minister of Trade and Commerce of Canada's imports of cream separators, none came from the United Kingdom. So, if Great Britain is going to avail herself of the opportunities in the Canadian market, presented by this agreement, in my opinion she is going to build up trade in a new type of separator. The information I have is that in the years from 1910 to 1920 all the importations from the mother country were separators of a type used in the factories, not the type used by the farmer. If by this you are going to shut out today the Vega Swedish separator, I say you are doing the dairy industry in western Canada-I speak only of that because I have knowledge of it-a great injustice. The Vega separator has done more to bring down the price of separators in Canada than any other thing I know. I operate one of them on my own farm. Whether this 25 per cent will entirely shut it out I do not know, but I believe the Minister of National Revenue will see that it is shut out, because he will place an arbitrary valuation upon it. I do not care what the minister says regarding the 25 per cent encouraging inter-empire trade, it is only going to encourage it at the expense of the user of cream separators. /If we can get an assurance from the Minister of National Revenue, or from the government, that importations from sources that are now supplying Canada with cream separators will be taken at the valuation at the port of entry, and that the Minister of National Revenue will not be allowed to place a fictitious and artificial valuation on them for duty purposes in order to exclude them, I think we can pretty much agree to this proposal now.


William Richard Motherwell: When this government came into power they found on the free list in all columns, preferential, intermediate and general, a considerable number of items of particular interest to agriculture. One item was binder twine, another was farm fertilizers, another was barbed wire, and now cream separators. Three out of those four com-

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modities have been taken off the free list, as far as the intermediate and general tariff is concerned, and in some cases all tariffs-


Mr. SMITH (Victoria):: I would like to ask a question. What ingredient that goes into the composition of fertilizer is not on the free list today?


William Richard Motherwell: I regret I cannot
hear my hon. friend. He can mix any kind of fertilizer he likes, I am trying to talk my own talk. I see that even the Minister of Trade and Commerce appreciates that, inasmuch as he lectured me for that kind of inadvertent remark the other day. I was pointing out that it seems to be the policy of this government to take all these key commodities that were free to the farmer before and put a tariff on them. I do not berate them very much for that, they are carrying out the policy that they enunciated at the last election, they are running true to form. That is one of their promises that they are carrying out, and doing it to the full. They are making the cleavage between the two historic parties more distinct than ever. When the next election comes the people will have no doubt which is the high tariff party and which is the moderate or revenue tariff party.


Mr. CHAPLIN:: They have not been able to distinguish that for the last twenty-five years.


William Richard Motherwell: Well, they distinguished the difference in the United States the other day, and they will not have any trouble distinguishing it here now. I want to point out that farmers today are not in a condition to have their morale further destroyed by this continual jacking up of tariffs. If the average farmer on the prairies lost his separator by fire or otherwise, how could he replace it today? Even though prices are not made higher, unless they go down in keeping with the price of his commodity that he sells, he is going to get worse off all the time. Prices of equipment and general supplies for the farm have not gone down in proportion to prices of what the farmer has to sell. He will be fearful that this is going to be repeated in the case of both wire and cream separators.
My information is that our manufacturers of cream separators are not running anything like full capacity now; some of them are almost idle. Last evening the minister expatiated freely on the advantage of having mew firms establish themselves in Canada. But if those who are now here are only
running part time how will it help to have new firms establish themselves for the manufacture of this commodity? It seems to me he is only going to cut up the now small business there is, into smaller allotments so that each and all will lose out.
However, I suppose if we talk till doomsday on this question it will not make any difference in our respective attitudes. I think it is profoundly wrong on the part of the government to do what they have done in regard to wire and cream separators, I think it is a great mistake. It is hard on the purchasers of these commodities, and later on it is going to be hard on the government. To the latter of course, I will not take any exception. I would ask them, though, if it is possible to reconsider this item. I think we were told yesterday that some of these questions were going to be reopened with the British government. I do not plead for the sake of the government, because I have no particular brief for my hon. friends, but I plead for the dairying industry, always an exacting laborious industry, a very, very trying occupation to those engaged in it, summer and winter, Saturday and Sunday; and now the government is just going to put one more straw on the back of the dairyman. And it is the last straw that breaks the camel's back, or the dairyman's as the case may be. It will be also the last nail in the political coffin of hon. gentlemen opposite. There have been a lot of last nails, I think we have a whole package of them accumulated for this purpose. I do not know that we need another, so I appeal to them to reconsider this item. They are making a profound blunder not only from the standpoint of the dairymen of this country but from the standpoint of their own political hides; I have no particular regard for those, but I have for the dairying industry of Canada.


Mr. HACKETT:: Some reference has been made to the members from the eastern townships, where butter is an important product, and one in which the members for that section of the country are very much interested. The hon. gentleman who has just taken his seat has asked the government to reconsider its position. May I ask the hon. gentleman just what he would like the government to do? The government have reduced the duty on separator parts, and separators are still introduced into Canada free from Great Britain.


Charles-Philippe Beaubien: They do not make
them.


Edward James Young: They were always free.
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John Thomas Hackett: They were always free,
but the position of the dairyman and the person who uses separators has been improved at least to the extent that the parts now will come in free. The hon. member for Melville presided for a number of years over the department which is most interested in the farmers, and it seems to me but fair to ask why, during the rather long period of his administration, some of that compunction and that feeling which he now expresses for the farmers and the users of separators did not find expression in a reduction or the entire elimination of the duty on separator parts. I believe that if there is one utensil which has remained at a very high price level it is this particular one, notwithstanding the fact that it was free across the board. This would seem to indicate that our only hope of obtaining a reduction in price is by enabling our own manufacturers to increase their production and thereby reduce the price of the utensil.
I thank the hon. member for Provencher for being so solicitous for the farming communities of the eastern townships. I beg to assure him that the member for every constituency in that section of the country is in his seat and has followed these discussions with particular interest.


George Gibson Coote: I think it is very misleading to keep on saying that cream separators may be imported free from any country within the empire. As closely as I can figure it out, it seems to me there is a duty of at least 18 per cent against separators in addition to a 3 per cent excise tax. If the figures which I have worked out very roughly are correct, any farmer in Canada who imports a cream separator from Great Britain or any other part of the empire and which costs him $100 will have to pay $18 duty and $3 excise.
I think the hon. member for Stanstead has just put the case very clearly. This change in the tariff is principally for the purpose of enabling the Canadian manufacturer to get a larger market in Canada. Of course he believes that there will be no increase in price. I should like to ask the government very definitely what organization they have in any department of the government to see whether or not there is any increase. I should like to say also that I think we should have a decrease in the price of separators. There has been a drop of at least fifty per cent in the price of our butter. At one time this year in western Canada the price of butter fat dropped to 20 per cent of what it was four or five years ago, but there was

no corresponding drop in the price of cream separators. There has been no drop yet, and I do not think there will be a drop after this arrangement comes into operation. I do not suppose there would have been a drop in any case, but I am afraid this will prevent any decrease which perhaps might have come about otherwise.
Then I should like to ask the government whether the exchange dumping duty applies to importations of cream separators from Sweden. I understand that Swedish currency is depreciated in Canada just as much as if not a little more than the British currency. Is this exchange dumping duty to apply against importations from Sweden or any other country which has depreciated currency? Then there is one other question. Would the exchange dumping duty apply against other countries within the British Empire than Great Britain? For instance, would it apply in the case of importations from Australia or New Zealand?


Henry Herbert Stevens: The exchange adjustment duty applies naturally to countries whose currency is depreciated. It will apply to European countries to which my hon. friend refers as it does to Great Britain. The precise value of these different currencies is declared, of course, by order in council based upon the Customs Act, I think.


George Gibson Coote: Is that done in connection with each country?


Henry Herbert Stevens: Yes. In regard to Australia I do not think the exchange adjustment duty is applied.


George Gibson Coote: Then I suppose it would be possible for an importer in Canada to have his cream separator sent from Great Britain to Australia and then reshipped to Canada. In that way could we evade this exchange dumping duty?


Henry Herbert Stevens: That is rather a subtle suggestion, and I think perhaps an importer might give it the once over. I should not like to put the official imprimatur on it.


George Gibson Coote: I am looking for a way to keep down the price of cream separators, and I am putting that question to the minister now.


Henry Herbert Stevens: I think that is a clever suggestion.


William Daum Euler: If that were done once, would the government allow the practice to be continued?


Henry Herbert Stevens: I would rather not speculate on these ifs.

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George Gibson Coote: Again I would like to ask the minister if there is any organization in his department, or in any department of the government, to see whether any increase does take place in the price of barbed wire, cream separators and other classes of commodities which have been mentioned here.


Henry Herbert Stevens: Very close track is kept of the variations in prices of goods; officers of the Department of National Revenue and of the bureau of statistics, as well as officers of the Department of Labour administering the Combines Investigation Act, all keep close tab on these matters, and the members of the government are kept informed. I may say that I know the Prime Minister takes a very deep interest in that particular kind of information.


George Gibson Coote: Is it the duty of any of these officers to report to the government any increase in price?


Henry Herbert Stevens: In a sense that is rather a strange question. It is just as I have indicated; these matters of prices are carefully kept track of, and the information is laid before the ministers and before the government. I think, of course, my hon. friend wants to know if there is any officer who is specifically instructed to keep a check on these prices and take action under any statute or regulation. I should say there is no officer with such a specific duty.


Mr. BOTHWELL:: Before this item carries I think the house and the country might as well realize that it will mean an increase in the price of cream separators. In 1930 we had assurance from this government in connection with various commodities on which duties were increased; they told us that there would be no increase in prices. The government gave us to understand that they had the assurance in writing from the manufacturers that there would be no increase in price. We were led to believe that the government would assume the responsibility of removing the duties where prices were not reduced in accordance with world prices. We had that assurance from the Prime Minister and I would ask the government now whether anything has been done since 1930. I ask this house, has anything been done by this government since that time? They realized that they should take into consideration the fact that when world prices dropped there should be a corresponding drop in our own commodities. It has been drawn to the attention of the house by members at various times that there have been either increases or no reductions, and we are entitled to know what action has
been taken. In speaking of items that were dealt with in 1930, I will refer once again to oil products. The case was clearly proved. We had the definite assurance of the Prime Minister in 1930, but nothing was done and it does not appear to be the intention of this government to carry out the undertakings they gave the people. As regards the minister's assurance that there will be no increase in price, that is just so much more humbug, such as we got in 1930. Everyone who has listened to the discussion that has taken place on this and on other items under this agreement will realize that where there is an increase in duty there will be a consequent increase in price to the consumer, and the farmers who have to buy cream separators might just as well make up their minds right now that they will pay more for that commodity.


Edward James Young: The Minister of Finance a little while ago made quite a point of the fact that under the old regime the manufacturers of cream separators were allowed to bring in parts duty free, while farmers wishing to bring in the same parts for repair purposes paid a duty. Will he tell us what inference he draws from that statement, or what significance he attaches to it.


Edgar Nelson Rhodes: It is obvious that they get their repair parts now free under the British preference, whereas before they paid a substantial duty; and even in the case of repair parts from foreign countries there will be a reduction in practically every instance as compared with the former rates, because now they pay 25 per cent whereas in respect of some items the duty formerly went as high as 45 per cent under the general tariff. Now, as I say, it is 25 per cent.


Edward James Young: The minister has answered
that part of my question to which I do not attach so much significance. What I regard as important is the fact that the manufacturer got his parts free while the farmer paid a duty. What significance does the minister attach to that point which he made?


Edgar Nelson Rhodes: None, except that the
manufacturer was placed in a preferred position as against the farmer. He got parts free where the farmer paid a duty.


Edward James Young: I am glad the minister admits that. He admits now that tariffs do raise prices.


Some hon, MEMBERS:: Oh, oh.


Edward James Young: I hope that hon. gentlemen opposite will no longer tell us that
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tariffs do not raise prices. There is another question I want to ask. We have on the statute books certain anti-dumping laws which provide that if the foreign exporter wishing to get his goods into this country undertakes to pay the duty, an additional special dumping duty will be imposed. Can the minister tell me whether Great Britain has such a provision in her customs laws?


Edgar Nelson Rhodes: Great Britain would have no necessity for it in relation to Canada because our currency is of greater value.


Edward James Young: I do not mean in relation to Canada; but in her Customs Act has she any anti-dumping provision which would forbid foreigners to dump their products in the British market? I understand she has a duty of 20 per cent on cream separators. Has she a provision which makes it impossible for the foreigner to pay that duty and bring in separators?


Henry Herbert Stevens: The British system is different from ours. I am glad my hon. friend raised that question because it reminds me of something I overlooked a few moments ago when he inquired what the British duty was on cream separators, and some of the other hon. gentlemen inquired with regard to parts. It must be borne in mind that Great Britain imposes its duties on a c.i.f. basis, which is a very much higher basis than we are on, ours being the f.o.b. basis. Take cream separators for instance. The Canadian duty would be imposed on the cost of the article in Great Britain. In the case of a Canadian separator going into Great Britain, the duty would be based on the cost of the article, plus freight, plus port landing charges and all other charges, as I indicated the other day. So that you have an entirely different basis, and your ratio of duty imposed in Great Britain, although it might appear to be lower, might actually be higher. So much for that. My hon. friend asks whether Great Britain has a dumping duty provision similar to ours. They have not the same provisions as we have. Great Britain operates its import act very largely by regulations under the treasury board, and broad general powers are given to that body. It is under the treasury board, the official being known as the Commissioner of Customs and Excise, and they invest the board and the commissioner with very wide powers. They have not the same dumping provisions as we have but, as we do, they insist upon a sworn declaration of the accuracy of the invoice, which must be in just as clear terms as we call for. And, of course, they have a provision for the imposition of

penalties in any case where there is an inaccurate or false declaration.


Edward James Young: That puts us in this position then. Britain has no anti-dumping laws but she insists of course on a true and accurate invoice. But if the Swedish manufacturer of cream separators wishes to absorb the British duty and sell in Britain at the same price as he would sell in Sweden, he may do so. These separators cannot of course be transhipped to Canada, but the effect of that possibility to the Swedish manufacturer would be to force the British manufacturer in Great Britain to compete with the imported article, would it not? We should therefore find the price of separators in Britain coming down to the world level, and so the Canadian manufacturer who is looking for additional protection would find himself in competition with British separators selling at world prices. That would not hurt the farmer very much; he would not object to that. I want to look at the figures the minister gave last night. Home production, according to the figures he gave us, has declined since 1929 from 13,431 to 7,218. That is, the production of separators in Canada has been cut about in half. But our exports of the same article have been cut about eight. We export only about one-eighth of what we did two years ago. This world market we are losing. The other night tinplate-item 383, I believe-was under discussion. There is an increase in the duty on tinplate from the outside world and the minister told us that those who produce the commodity, and the biggest user of it in Canada, were present and did not raise any objection. We asked him if there were any secondary manufacturers to whom the commodity would be a raw material and who might find themselves handicapped by that increase in duty, and would therefore expect some compensating increase in the duty on their product. Now, the manufacturer of cream separators uses tinplate to a large extent, and as a result of the increase in duty under item 383 he will find himself in the position of paying higher prices for some of his raw material.


Henry Herbert Stevens: My hon. friend is no doubt well informed, but I should like him if he could to indicate just what tinplate is used in the manufacture of separators.


Edward James Young: The discs are coated with tin.


Henry Herbert Stevens: I do not think a disc
manufactured from tin-plate would wear very well.


Edward James Young: They do not, they get rusty very quickly.

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Henry Herbert Stevens: I am afraid my hon. friend is in error.


Edward James Young: No, I am not in error; I know there is a considerable amount of tinplate material used in these machines.


Henry Herbert Stevens: I am afraid I must challenge that statement.


Edward James Young: I know the tin wears off very quickly, they get rusty and you have to renew them.
The result of this change will be to increase the cost of some of the raw material to the manufacturer. He will then seek compensation in the way of a higher duty upon his finished product. After this principle has been established it will be found that the cream separator man will have a real kick coming when we try to take off his duty; he will say, " You have increased the cost of my raw material and I must increase the cost of my finished product." The man who has been encouraged to go into the manufacture of tinplate will object to having the duty removed because of the investment he has made. The result of this legislation will be that more cream separators will be manufactured in Canada and Britain and the 23,838 separators which came in last year will be excluded from this country. Where will those separators be sold? They will be sold on the world market, there will be a dumping of separators somewhere. Our Canadian manufacturers will not be in a position to compete in the world market as they can compete at the present time.


Henry Herbert Stevens: The hon. member ought to be happy.


Edward James Young: Because our Canadian manufacturers cannot compete? No. My hon. friend might be happy in succeeding in raising the cost of manufacture to a point where our manufacturers cannot compete in the world markets, but I am not. I would be much happier if he would create a condition of affairs where our manufacturers could compete in the world markets. This legislation increases the cost of production and puts our manufacturers in a position where they cannot lower the cost to the Canadian consumer.
I should like to refer to an argument made yesterday by the Prime Minister and repeated in part this morning by the Minister of Trade and Commerce. As a reason for the increase in duty, the Prime Minister said that it had been done in order to encourage the Canadian workman to consume Canadian farm products. He said that this country produced some $1,600,000,000 worth of farm products of which
$1,300,000,000 was consumed in Canada. I asked the Prime Minister if he had made any allowance for duplications, but he replied that he considered the figures to be correct. I took the trouble to check over these figures and I find that in order to find a year in which there was $1,600,000,000 worth of farm products produced in Canada, the Prime Minister had to go back to the days of the Liberal regime in 1929. The Prime Minister has evidently forgotten that there has been a change of government and that there is no such wealth produced today. Today the total value of farm products produced is $880,000,000, just about one-half what it was in 1929.
As far as consumption by the Canadian people is concerned, let us see what happens to this production before it reaches the people. Some 3,000,000 horses have to be fed, some 8.000,000 cattle have to be fed, some
3,600,000	sheep have to be fed, some 4,700,000 swine and 65,000,000 poultry have to be fed; all these animals have to be fed before the people of Canada get a chance at this production. The Prime Minister simply took the gross value of all farm products produced in Canada and said that that is what we consume; he forgot that the hay is destroyed in producing milk, that the milk is destroyed in producing butter and cream and that the only thing that counts is the final product. I suggest to hon. gentlemen opposite that when they refer to a possible market for our farm products they take pains to see where the stuff is consumed.


George Gibson Coote: Can the minister advise
whether or not the United States places an exchange dumping duty against Great Britain and against Canada?


Henry Herbert Stevens: There is no special duty
imposed by the United States but it must be borne in mind that they have, first, a very high rate of duty, and, secondly, a specific provision in their tariff which enables the president, through machinery which can be very promptly put in motion, to impose an embargo or increase the duty as he thinks fit whenever it is disclosed to him that any industry or interest in the United States is affected injuriously. This power is quite frequently invoked.


George Gibson Coote: That is somewhat similai
to the power exercised by our Minister of National Revenue under section 43? I have been told that cream separators are free under the United States tariff. If that is so, apparently that country is treating Great Britain
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much better than we do. If that is so, it needs some stretching of the imagination to call this a preferential treatment for Great Britain.


Mr. CAYLEY:: This is a most important
item to the farm industry and I was wondering whether or not the National Dairy Council was consulted before this change was made. It seems to me that there is no other body or organization in the dominion which it would have been more logical to consult in connection with this matter. I know there was a body of farmers who desired to make representations to the government before anything was done, but they were not successful in their efforts.


Edgar Nelson Rhodes: Neither the dairy council
nor the manufacturers were consulted. This was dealt with as a matter of government policy, it was one of the items upon which Great Britain laid particular stress.


George Gibson Coote: Does the United States
place a duty upon cream separators from Canada ?


Edgar Nelson Rhodes: Some of them are allowed in free but if they are above a certain value they carry a duty.


George Gibson Coote: It seems to me that the
United States is treating us better than we are treating Great Britain, because we place an exchange adjustment duty against cream separators coming in from the old country while the United States has no such duty against Canada. We are in effect placing a duty of eighteen or twenty per cent upon cream separators coming from Great Britain. So far as I am concerned, I protest very strongly against this item, I think it is a mistake to have it in the agreement and the government should take up this matter with the British government in an endeavour to have the item changed by mutual consent.


Edward James Young: Is this an item where the
American tariff is reciprocal?


Edgar Nelson Rhodes: I think the answer is in
the negative.


Charles-Philippe Beaubien: I think the hon. member for South Battleford (Mr. Yallance) made a very reasonable request when he asked that the government, through the Minister of National Revenue, allow cream separators to come in under the present duty without any interference by the placing thereon of an arbitrary value. The Minister of National Revenue is in his seat and I should like to get some assurance from him that this reasonable request will be acceded to. Before I

take my seat may I say to my hon. friend from Stanstead (Mr. Hackett) that the only reason I mentioned the eastern townships was that I spent a very pleasant week-end there last year, and the people were so kind to me that I could not forget them.


Mr. SPEAKMAN:: When speaking on the agreement as a whole I indicated that I thought this particular item was from our point of view the worst item in the whole schedule. I singled it out as the one which in my opinion would be the most difficult for the government to defend. It has been stated by the ministers who are representing the government and defending this agreement that all arguments from this side of the house are based wholly on the assumption that prices will be increased. It has been indicated, and I think quite correctly, that the final proof will be supplied by the actual circumstances that arise. The proof of the pudding is in the eating. That of course is true. It is equally true as applied to any other item or any other piece of legislation brought down in this house dealing with conditions with which we have not had previous experience. But in making an assumption it is reasonable to ask, is it based upon logic, upon experience in other lines which might well be applied to the particular case before us? That is about all we can do. As a matter of fact, the government itself is assuming just as much as anybody else when they say that there will not be a price increase. The question is, what are the logical grounds for the assumption? All discussion would be wholly useless were we to accept the situation that we must wait and see. We cannot do that.
What are the facts? They are well known, and have been reiterated so often that I do not care to repeat them. Cream separators have come in free for many years. Now a certain condition has arisen and a duty of 25 per cent is being placed on all separators coming in from any country outside the British Empire. We turn to past years and find that a number of years ago Britain exported quite a substantial number of separators to this country. That business was stopped during the war because the factory was turned over to other purposes, and during the last few years no separators have entered this country from Britain. What are we to assume by that? We can only assume that at the price which is being paid for separators in Canada the British did not find it profitable to compete. In view of the fact that for the last five years Great Britain has been combing the earth looking for opportunities to increase her export trade in every direction, we can only conclude that she has not sold separators

United Kingdom.
in this country because she could not sell them at the price fixed by competition in this country. I think we can accept that.
The purpose of this new provision is twofold, and both purposes are perfectly legitimate. One is to permit Great Britain to sell a number of separators here, increasing her business by means of the preference. The other purpose is to enable the manufacturers of Canada to sell a larger proportion of their separators. The result anticipated by the minister is that there will be a greater output of separators on the part of both Great Britain and Canada, and that with that greater output the chances are in favour of a possible reduction in the price. Is that likely to be the case? Time alone will show. But to my mind, going upon the facts we have, as Great Britain has not been able to sell separators in Canada at present prices, it seems to me that only one of two things can happen: Either the Canadian manufacturer takes the whole market and in view of his larger output is able to continue to sell at present prices, or else prices will rise to a sufficient extent to allow Great Britain to sell separators at a profit in this country. Those are the only two alternatives.
As to the former, that Canadian manufacturers may supply the entire market at present prices, so long as they supply the separators we want and they are of good quality, I do not think exception can be taken to that. But why bring that in as part of this agreement? That would be no good to Great Britain. The only possible benefit that can come from this to Great Britain is from an increased price. I think we are warranted in assuming that, and therefore I think the argument which has been advanced as to the weight which this imposes on the dairy industry is well founded. True, it is only an assumption but I think it is a reasonable one.
The statement has been made that as a counterbalancing factor the price of repair parts will be lower than it was. If that be true, it will apply, of course, to those separators which are sold in the future. Just what value would a lower price on repair parts be tc the farmer w'ho owns a separator if those repair parts can only come from Great Britain and are not suitable for the farmer's purpose and the machine he now has? If you practically exclude repair parts from the country which made the separator, the lower price of the repair parts does not help the farmer at all.


Henry Herbert Stevens: My hon. friend will bear
in mind that while repair parts enter free from Great Britain, the duty on repair parts from 5371J-83
all other countries has been decreased very substantially.


Alfred Speakman: Precisely, and to that
extent undoubtedly it may be of some benefit to the farmer. In conclusion, without taking up any more time, I can only make the assertion that I look upon this item as not only unwise but unfair, as one which it will be most difficult to explain and defend in the country, and looking to the future I think we can only anticipate a higher price. It is one item to which I, in common with others, take great exception, believing it to be unnecessary as well as unwise. I might be asked, why then did I vote for the agreement? I voted for it, as I stated before, because against its disadvantages there must be offset the advantages of the British market for our butter and dairy products. You have to balance one against the other. But I do not think it is necessary to give with the one hand and take awiay with the other. If the farmer of this country requires a wider market for his products I think it is unfair to give him that with the one hand, and then partially deprive him of the benefit by taking away something with the other hand.


Thomas Merritt Cayley: In response to a question which I asked a few minutes ago the minister stated that this was a matter of government policy and therefore the National Dairy Council had not been consulted. I presume that would also apply so far as the British government is concerned. But I notice that in the schedule, under article one, free entry is provided into the British market for our butter and cheese and other milk products for three years certain. After that it is uncertain. That to me is a clear indication that the British government must have consulted their agricultural interests. In another article of the agreement reference is made to bacon and ham and pork products, and the provisions of that article are subject to a report to be made by a commission which is investigating farming conditions in Great Britain. I am convinced that the farmers of Canada have had a raw deal. They have knocked at the doors of the government asking to make representations so that the great industry of agriculture might receive some benefits and, at least on one occasion, they were refused. I point out that this government might better have left these two items of barbed wire and cream separators off the list entirely, because no maitter what their explanations may be the farmers are feeling they are being imposed upon by what the hon. member for North Huron (Mr. Spotton) has described as a great

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octopus. I am convinced that there is a whole family of them imposing upon the farmers, keeping prices up to a point they cannot reach. At the same time their farm produce, the only commodity they have to sell, is selling at ridiculously low prices. How can they go on with the prices they are receiving for their butter, cheese and milk; how can they pay for their equipment from the small receipts taken in for their produce. They are feeling keenly that this high tariff government is no friend of the farming industry.


Edmond Baird Ryckman: I have been called to my feet by the hon. member for Provencher (Mr. Beaubien). In answer I state that we are dealing with an agreement the terms of which must be kept. But if there is unfair trade and the government is in a position to act, it will most certainly use any instrument which comes to hand to prevent such a condition. For many years of my life I have been connected with the cream separator business. I am only sorry the Hon. Thomas Low, late Minister of Trade and Commerce in this house, was not present because he would bear out the further remarks I have to make.
I have been debating in my own mind whether some of the information I am about to disclose is of such a confidential character that I should not give it to the committee. I have decided however to state the facts as I know them. If any person tells you that this tariff change was sought by manufacturers, do not believe it. The statement has been made that they did not seek it, and I wish to add my testimony to that effect. Let me say also that the business in cream separators is diversified throughout the whole world, and yet it is in very few hands. A situation arose when it was more important for manufacturers of cream separators in Canada not to manufacture, but to import from the United States. There are two such concerns with establishments both here and in the United States. Another cream separator company stated it was unfair that cream separators and parts should be free for the manufacturer, and yet a duty levied upon the farmers. Therefore there was the situation of one company being willing to take the protection, and the other company unwilling. As the Hon. Thomas Low could tell you that condition continued. If a duty on cream separators had been asked from previous administrations I am sure, owing to the strength of opinion which would have supported it, that duty would have been granted. Now, what will be the effect of this tariff change?

The effect of the agreement with the United Kingdom representatives is that cream separators and parte thereof enter free. I feel satisfied if hon. members would examine the invoices in our custom houses they would find that the most important importer of cream separators and parts has been a company doing business in Canada. That will not continue, because that company-and a strong company it is-is quite able to manufacture those parts in Canada. This country, instead of the United States, will reap the benefit of such business. As the industry well knows, that is a plain fact.
Then, as to price: Do not believe that there is any danger of higher prices, because competition is now keen. These manufacturing concerns in Canada can manufacture at as low a price as they can manufacture in the United States. The suggestion may be offered that a greater market would give them an advantage in the United States, but I am suggesting that the two big concerns can tune up and give the farmer of Canada a cream separator at the price he is now paying. There will be no occasion for raising prices, and I feel sure the competition is so keen they will not be raised.


Mr. SANDERSON:: The minister has mentioned two large companies. Will they not tune together, and thereby exact greater prices from the farmers?


Edmond Baird Ryckman: There is just as little
likelihood of their tuning together as there is of my agreement with my hon. friend opposite. I know that in the British Empire there is a factory which is subsidiary to the major factory situated in Sweden. But when we speak of factories in Sweden, the United States and Finland we must remember they are_ all under one control; we are speaking merely of a main company with subsidiaries. I assure the committee that in my opinion this, on balance, is all to the good. There is that anomaly with regard to parts which, I submit, is unfair, and I do not think any hon. member of the house could reasonably defend it. That is wiped out. Parts will come to the farmer at lower prices brought about by competition. The business which formerly, for convenience sake, was done in the United States, will be done in Canada.
Why was one of these manufacturing concerns strongly opposed to a duty on cream separators? Because, powerful as they were, they were manufacturing other dairy machines which were going into the United States duty free. They said, "Do not disturb the present situation, because if you do there will be trouble." This representation was not

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made to the Conservative party, but to hon. members opposite when in power. But, on balance, in my view this is all to the good.


Edward James Young: If the minister disturbs the relationship in existence between the company he has mentioned and their export business to the United States, would he not expect they would lose a certain amount of Canadian business as a result.


Edmond Baird Ryckman: I think we will lose no
Canadian business at all; in fact I think we will gain more.


Mr. DONNELLY:: We have heard so much discussion on this cream separator item that I am led to wonder how we may expect Englishmen to export cream separators to Canada. Looking at the records we find that we have been exporting to Great Britain a large number of cream separators, and Great Britain has been exporting none to Canada, notwithstanding the fact that British cream separators were entitled to come in here free, as they will continue to be so entitled. What is going to arise to enable Great Britain to ship cream separators here? They will be on the same basis as they were before, they have been free, they are going to be free. But in some mysterious way they are now to come in. The only way I can see is that there is going to be an increase in price, if the price goes up then they will be able to come in. But there is something back of all this, there must be, as a reason why Great Britain has not been exporting cream separators to Canada. The fact is that the article made in Great Britain has not been favoured by Canadians, that is the whole story.
Then as to repairs from Great Britain being free, we are using no British machines, so we shall not want any repairs. What good will they do us? Then as to the great benefit to the farmers. We get cream separators in free now, we get the bowls in free, and if you take all other repairs that a man operating a cream separator requires what do they amount to in a year? About a dollar a year; so he may make a saving of five cents a year. But he will have to pay more for the separator. The government is making a great hurrah that they are going to save the farmer five cents a year on repairs. That is all it amounts to, it is another case of humibug, window-dressing, something to deceive the farmer.


Charles A. Stewart: I have a
few remarks to make on this item. Perhaps I could do it much better after we resume.
At one o'clock the committee took recess.
53719-83J
The committee resumed at three o'clock.


Finlay MacDonald: Shall item 409 carry?


Charles A. Stewart: No, Mr. Chairman. I have listened with a great deal of interest to the discussion on this item, and particularly to the statement made by the Minister of Finance and the Minister of Trade and Commerce that this tariff increase will not increase the price of the finished article. That is an argument that has been used by the government in defence of other increases in the tariff, and in order to bolster up that argument they frequently point to the fact that there have been no increases in the prices of manufactured products in Canada since they came into office. Perhaps that argument is good, but let me point out to the government that there has been a tremendous falling off in prices all along the line since this government came to power, and that the spread between the primary and secondary products is much wider than ever before. Undoubtedly that is the result of the protection received by the manufacturing industry of Canada.
In connection with the cream separator industry may I say that I cannot conceive any reason why this industry needs any particular protection. I do not know any good reason that can be suggested as to why it should receive protection. We do know that the British manufacturer, as has been very properly pointed out by several hon. gentlemen on this side of the house, is manufacturing the larger sizes of separators used in large creameries, and that even their own requirements are supplied from foreign sources. I think it is evident that they will have to reorganize their industry at least if they are to actively compete with Canadian manufacturers. Not only do this government persist in giving protection to Canadian manufacturers almost to the point of exclusion; they take the opposite course when the raw products used by the same manufacturers are in question, and that is what has happened here. The raw products which enter into the manufacture of cream separators have been reduced pretty well all along the line, and the argument that repair parts for the separators now in use by the farmers of Canada will be cheaper does not mean very much. That saving will amount to very little in the case of the average farmer who purchases these repair parts. One thing is sure, as the hon. member for Lisgar said; when the government increased the protection on farm implement parts, repair parts manufactured by indepen-
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dent industries who did not manufacture the complete article went up in price. There may be some reduction in these parts, but it will be very slight. The fact remains, and it has been self-evident throughout the discussion on tariff matters, that these increases will raise the price paid by the consumer. It seems to me nothing more need be said in that connection.
Hon. gentlemen opposite argued formerly t-hat by increasing the tariff we created more employment for people in Canada, and in consequence created a larger consuming public for our natural products. If there were any possibility of creating a secondary industry in this country that could consume all the farm and manufactured products there might be something in that argument, but by no process of reasoning can it be argued that we are even within measurable distance of that state of affairs. Moreover, it does not help even in countries where they can almost consume all their own products; on the contrary it has created a very difficult situation for the consumers in those countries, and in general has helped create more unemployment. So the argument put forward by hon. gentlemen opposite that this change will be beneficial to anyone-that is, anyone but the manufacturers of cream separators in Canada-has no basis. Undoubtedly those manufacturers will take advantage of the protection they are afforded. I have watched this process of the application of tariffs fairly closely, because it is one of the things in which I have been very greatly interested. As I said the other day, I know of only one industry in Canada that has not taken and is not taking full advantage of the protection afforded them. I refer to the rubber industry. Hon. gentlemen may argue that to the extent of three or four per cent other industries do not take that advantage, but why are protective duties necessary?
Hon. gentlemen opposite have stated in connection with this particular item-I believe it was the Prime Minister who made the statement-that the Canadian manufacturer of cream separators could compete with the American manufacturer, that he could produce an article equal in value at an equal cost. I think he stated that the Canadian manufacturers had so perfected their organizations in Canada that the same separator was selling wholesale for at least $28 less in Canada than in the United States. In the next breath he said he would have to admit that the importation from the United States into Canada was very considerable. No, Mr. Chairman,

every time you increase the tariff on a given product you can be dead sure that the consumers who purchase the goods will have to pay almost the whole of that increase.


Mr. GOTT:: If there is an increase.


Charles A. Stewart: My hon.
friend says "if there is an increase." I have just pointed out that instead of increases in prices we should have reductions all along the line that we have not had.


Mr. MALONEY:: Where is the increase?


Charles A. Stewart: If my hon.
friend lives another year or two he will see the increase, or if there is a reduction in world prices he will find that the Canadian product will not be reduced accordingly. That will be the position. Hon. gentlemen opposite assured the electors of this country that if they were returned to office they would increase the price of dairy products. That was one of the pet schemes on which they were elected. Have they done so?


Eccles James Gott: Yes, in western Ontario.


Charles A. Stewart: Well, I am
glad my hon. friend can say so. They have not done it in my constituency, and I am vitally interested. This year one of my neighbours who had been milking fifteen cows told me, when I asked how he was getting along, that he had given all but three of those cows to his neighbour, because, he said, the remuneration he was receiving for *the products of those cows would not pay for washing the milk spots off his overalls.


Eccles James Gott: May I ask a question?


Charles A. Stewart: My hon.
friend will have his chance when I am through. He will have a chance also to explain to his electors just why he has not carried out the promises he made when they elected him in 1930.


Eccles James Gott: I did not make any promises.


Charles A. Stewart: A great many other hon. gentlemen will have that opportunity also. May I tell my friends opposite that their electors are just waiting for an opportunity to hear the explanations that my friends may have to offer. Then, on top of that disappointment, they are taking the opportunity of loading upon the back of the farmers just a little more in the way of costs, and that in an industry which they have nearly destroyed already.


Eccles James Gott: Is this drama or comedy?

United Kingdom


Charles A. Stewart: That is what hon. gentlemen opposite have done. And then forsooth they turn around and say to us, "You would rather trade with the United States or some other foreign country than with Britain." May I say to hon. gentlemen opposite that the only interest that concerns me is the interest of the great consuming public of Canada. That is the only interest I have ever had.


Mr. KENNEDY (Winnipeg):: Who is not a consumer?


Charles A. Stewart: Hon. gentlemen opposite who live under the protection afforded them in manufacturing are usually not very heavy consumers. For the most part, if you come to examine it as minutely as I did some years ago, you will find that most of them are wearing and frequently eating foreign products; and most of them are always yelling, if they require anything in the way of raw products, to have such commodities come in duty free. That is the position which my hon. friends opposite occupy. Then they talk about our right-about-face in matters of this kind. If there is any raw product required in any given manufacture, they are here in full force asking that it be made free, and then when they get their product manufactured they place a respectable duty upon it so that they can milk the producers of the country in the process.


[Stage Direction]
Item agreed to.
Customs tariff-4101.	Ore crushers, rock
crushers, stamp mills, grinding mills, rock drills, percussion coal cutters, coal augers, rotary coal drills, n.o.p., and complete parts of all the foregoing, for use exclusively in mining, metallurgical or quarrying operations: British preferential tariff, 74 per cent; intermediate tariff, 20 per cent; general tarif. 25 per cent.
Mr. BRADETTE:: Can the minister give us some information in regard to this item?


Edgar Nelson Rhodes: Under this item the imports last year amounted to $1,013,000; $309,000 came from the United Kingdom, $678,000 from the United States and $24,000 from Germany.


Thomas Reid: Will the minister consider adding the words, "for road construction purposes as well." Many municipalities and provincial governments are in the market for rock crushers for road-making purposes, and this item is confined to machinery for metallurgical or quarrying operations. There will be a doubt regarding this matter when a municipality or a provincial government wishes to purchase a rock crusher for road purposes.


Edgar Nelson Rhodes: Is the hon. gentleman asking that the item be enlarged to include crushing machinery for road purposes?


Thomas Reid: Yes, if a preference is given.


Edgar Nelson Rhodes: Of course the hon. member will realize that we cannot amend the article without further consultation. Is he merely asking whether such machinery is included in the item?


Thomas Reid: Yes.


Edgar Nelson Rhodes: No, it is not.


John Vallance: Why not?


Thomas Reid: This is rather important.


Edgar Nelson Rhodes: There has been no change in the item so far as the wording is concerned; it is the same as it has appeared in the tariff.


Joseph-Arthur Bradette: I gather that most of the crushers which are extensively used in the mining areas of this country have come from the United States, and the fact that we are increasing the tariff is bound to react on that fundamental industry in the mining sections of Canada, because the miners, like all primary producers, must obtain their machinery as cheaply as possible if they are to carry on. I have received protests in this connection, and some of those who are complaining are afraid that this will increase the cost of mining operations. Take the Porcupine district. 8ome ores there are yielding $7 per ton now and the committee will readily understand that the cost of production must be kept as low as possible or a mine like Hollinger will have to close its doors and then thousands of people who are employed the year round will be thrown out of work. I think the committee should give this matter thorough consideration. It is true that in Canada today we have an industry which manufactures some parts of big machinery used in these operations, but if my information is correct most of the heavy machines come primarily from the United States and England. As regards giving a preference to the English manufacturers, that is fine; but a large number of these machines must necessarily come from the United States and, I repeat, we cannot jeopardize the mining industry in this country by adding to its operating costs.


Edgar Nelson Rhodes: Even under the old tariff of 10 per cent British preference we imported over $300,000 worth of mining machinery from England, and the obvious conclusion is that by widening the preference from 10 to 74 per cent that importation will be still more largely in-
1310	COMMONS
Imperial Conference-Trade Agreements
creased. May I say that we have received no protests whatsoever from the mining industry in Canada with regard to these proposals.


Charles A. Stewart: What are the imports from foreign countries?


Edgar Nelson Rhodes: From Germany, $24,000, and from the United States $687,000.


John Vallance: What is the present duty on rock crushers used for road-making purposes?


Edgar Nelson Rhodes: It is difficult for me, even with the officials of my department here, to give a categorical answer to my hon. friend because the probabilities are that crushers used in road-making come under another item, 422a or 427. It is a matter of ruling by the National Revenue department.


Joseph-Arthur Bradette: The fact remains that at present our mining industry must of necessity purchase machines to the value of half a million dollars per annum, and I can see no other effect, from the change in the intermediate and general tariff, than to increase the cost of this machinery to producers in Canada. I suppose it is impossible at this time to have these tariff schedules changed, but I can frankly inform the minister that I have received protests from the mining districts, particularly from the new mines in northern [DOT]Ontario, to the effect that any increase in the *tariff will result in increased cost of production. I know that the minister want3 to 'be fair to the mining industry, but surely in *view of the fact that we are importing half a imillion dollars worth of absolutely necessary *machinery required by our mines in this i Country, he must admit that any increase in the tariff against the United States is bound . to .result in an increase in the cost of production in that industry, inasmuch as we import so much from that country.


[Stage Direction]
Item agreed to.
Customs tariff-ex 410o. Coal-cutting machines, n.o.p.: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 10 per cent.
Mr. NEILL:: I want some information in 'regard to this item. Some years ago this was [DOT] put on the free list with a view, I believe, to cheapening the tools of production. As we all know, the coal industry from east to west is in a very bad condition, heavily bonused .'in the east, heavily bonused in the centre, rather slightly and shabbily bonused in British Columbia. So far as I learn, these machines are not exported from England to any extent, but are obtained in the United States, and certainly on the Pacific coast they will be

brought in from that source. What is the importation from 'Great Britain, and what is the idea of increasing the duty, with its inevitable result upon this distressed industry?


Edgar Nelson Rhodes: Usually my hon. friend is singularly well informed upon practically any subject on which he speaks, but I regret that in this case he is misinformed as to production in England. As a matter of fact they specialize in this type of machinery there, and are particularly efficient in the manufacture of coal-cutting machines. I may say to the committee that this is one of the items which Great Britain especially requested.


Alan Webster Neill: What are the import figures?


Edgar Nelson Rhodes: I am unable to give that information because I am informed by the officials that the figures are not segregated.


Alan Webster Neill: How does the hon. minister
know that the British are particularly successful in manufacturing and exporting this article?


Edgar Nelson Rhodes: That information has been obtained upon inquiry.


Alan Webster Neill: It seems to me to be one
word against another. The minister has been informed that this is a very successful industry and I have been informed that it is not, and there are no figures available. I did take the trouble to attempt to obtain the information for which I have asked, and the minister is correct in stating that the import figures are jumbled up with the imports in connection with other articles. I have attempted to strike an average of the items under which this article comes which is imported from Great Britain, and I find it to be something like -025 of one per cent. If that is correct there cannot be very large importations from Great Britain. Perhaps this argument may be rather specious because there might be a whole lot of this particular article and a small number of the other articles which go to make up the aggregate of the item. I shall not refer particularly to the undesirable system of lumping different articles together. So far as I can make out from the records of the Bureau of Statistics there will be a very small benefit to Great Britain because of this item. Unless the minister has positive knowledge that there have been so many thousands of these machines valued at so many hundreds of thousands of dollars brought into this country, I think we must accept the figures before us which show that there has been only a small number brought in. Can the minister give us any information as to the importations from the United States?

United Kingdom


Edgar Nelson Rhodes: I do not think the hon.
member is justified in arriving at the conclusion that because we did not import a large quantity of coal cutting machinery from Great Britain when this article was free across the board, it follows therefore that they are not manufacturing a quantity and an excellent quality of this class of machinery. As a matter of fact, Great Britain is a fairly substantial exporter of this particular machine. The figures from the Department of Trade and Commerce disclose that last year she exported over half a million dollars worth of this commodity, some coming to Canada. The information from the mining industry is that the British machine is a highly efficient and modern product.


Alan Webster Neill: Does the Canadian industry
say it is satisfied with it?


Edgar Nelson Rhodes: Yes. When I say the
Canadian industry I hope my hon. friend will not take it that I mean the whole industry. Such information as we have been able to gather is to the effect that it is a highly efficient machine.


Alan Webster Neill: And is used by Canadian
coal miners?


Edgar Nelson Rhodes: Yes.


Alan Webster Neill: Does any of that information come from the Pacific slope?


Edgar Nelson Rhodes: I cannot say "yes" to
that.


Alan Webster Neill: I will go a little further and say that my information is that on the Pacific slope they have to get their machines from the United States. This change will mean an increase in the price to the extent to which the duty is being put on, which is 20 per cent.


Edgar Nelson Rhodes: Ten per cent.


Alan Webster Neill: The industry will be penalized. It is ten per cent for the general?


Edgar Nelson Rhodes: Ten and ten per cent.


Alan Webster Neill: Although ten per cent may not seem very much it means a lot to an industry which is so dilapidated as this one. There may be some importation of these machines into eastern Canada, but the machines used on the Pacific coast are imported from the United States and the industry in that part of Canada will have to continue to import from that source.


George Gibson Coote: Will the exchange adjustment duty apply to this item? I understand that that duty is charged in connection with
goods of a class made in Canada, and I was wondering if it would apply to this item.


Edgar Nelson Rhodes: The exchange adjustment duty has a general application. My hon. friend need not put his query with respect to each individual item; he can take it that this duty is applicable in general.


Joseph-Arthur Bradette: Are we discussing item 410a?


Edgar Nelson Rhodes: No, 410o as appears in the bill.


[Stage Direction]
Item agreed to.
Customs tariff-412a. Offset presses; lithographic presses; printing presses and typemaking accessories therefor, n.o.p.: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 15 per cent.
Mr. MARCIL:: Could we have an explanation of this item?


Edgar Nelson Rhodes: W'hat particular information does my hon. friend desire?


Charles Marcil: Where do these machines come from?


Edgar Nelson Rhodes: The imports of the total item, out of which we have taken this one, amounted last year to $941,000, of which $123,000 came from the United Kingdom, $731,000 from the United States, and $84,000 from Germany.


[Stage Direction]
Item agreed to.
Customs tariff-412b.	Flat bed cylinder
printing presses, to print sheets of a size 25 by 38 inches or larger, and complete parts thereof; machines designed to fold or sheetfeed paper or cardboard, and complete parts thereof: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 15 per cent.
Item agreed to.
Customs tariff-414. Typewriters and complete parts thereof: British_ preferential tariff, free: intermediate tariff, 25 per cent; general tariff, 25 per cent.
Mr. MACKENZIE (Vancouver):: How
many were imported last year from the United Kingdom and the United States?


Edgar Nelson Rhodes: The imports for last year were valued at $297,000, of which $11,700 came from the United Kingdom, and $285,000 from the United States.


Ian Alistair Mackenzie: Is it
hoped to encourage the importations from the United Kingdom?


Edgar Nelson Rhodes: Yes. I am told that already there has been an increase in the importations from Great Britain.
1312	COMMONS
Imperial Conference-Trade Agreements


William Lyon Mackenzie King: Has any order been placed by the government for English typewriters?


Edgar Nelson Rhodes: Yes.


William Lyon Mackenzie King: Is that in preference to Canadian typewriters?


Edgar Nelson Rhodes: We are dealing with preferences.


[Stage Direction]
Item agreed to.
Customs tariff-422a.	Trench and ditch
excavating machines, round wheel or vertical or ladder boom, chain and bucket type, for digging vertical or sloping bank ditches: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 15 per cent.
George Gibson Coote: Were there any importations last year from Great Britain?


Henry Herbert Stevens: The item is not segregated but I happen to know that there is a very substantial business now being done and the prospects for a marked increase are very definite. Certain connections have been made during the last six months which should prove to be very beneficial.


[Stage Direction]
Item agreed to.
Customs tariff-427. Ball and roller bearings: British preferential tariff. 5 per cent; intermediate tariff, 274 per cent; general tariff, 35 per cent.
Ian Alistair Mackenzie: Is this article manufactured in Canada?


Edgar Nelson Rhodes: Practically not.


[Stage Direction]
Item agreed to.
Customs tariff-ex 427. Machinery, viz.:
Power churns, power milk coolers, power fillers and cappers, power ice cream mixers, power butter printers, power cream savers, power bottle sterilizers, power brine tanks, power mill: bottle washers, power milk can washers; ice-breaking machines, valveless or centrifugal milk pumps, sanitary milk and cream vats; none of the foregoing to include motive power: British preferential tariff, free; intermediate tariff, 27i per cent; general tariff, 35 per cent.
Item agreed to.
Customs tariff-ex 428a. Engines for motor trucks or motor buses when of 100 h.p. or more: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 27J per cent.
Item agreed to.
Customs tariff-429. Cutlery of iron or steel, plated or not:
(b) table knives and table forks: British preferential tariff, 15 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent.
(c-) pen knives, jack-knives, and pocket knives of all kinds: British preferential tariff,

free: intermediate tariff, 30 per cent; general tariff, 30 per cent.
(d)	knives, n.o.p.: British preferential tariff, free: intermediate tariff, 30 per cent; general tariff, 30 per cent.
(e)	spoons: British preferential tariff, 15 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent.
(f)	scissors and shears, n.o.p.: British preferential tariff, free; intermediate tariff, 30 per cent; general tariff, 30 per cent.
(g)	razors and razor blades: British preferential tariff, free; intermediate tariff. 30 per cent; general tariff, 30 per cent.
Alfred Speakman: I assume that there is a substantial importation from Great Britain under this item.


Edgar Nelson Rhodes: Our imports last year of knives and forks alone were $229,000, $167,000 from the United Kingdom, $33,000 from the United States, $16,000 from Germany and $11,000 from France.


William Lyon Mackenzie King: Is it not a fact that 15 per cent has been retained on table knives and forks, the blanks of which are imported free, and that on all the other items the duty has been removed? Could my hon. friend explain why that is the case?


Edgar Nelson Rhodes: That is because there is a very substantial industry in Canada.


William Lyon Mackenzie King: Pressure from local interests.
Mr. RHODES. No. Protection is given along the same lines as has been given for the past five years to an industry which has been established here. The duty has been reduced five per cent.


[Stage Direction]
Item agreed to.
Customs tariff-431b. Adzes, anvils, vices, cleavers, hatchets, saws, augers, bits, drills, files, rasps, screwdrivers, planes, spokeshaves, chisels, mallets, metal wedges, wrenches, sledges, hammers, crowbars, cantdogs, and track tools, picks, mattocks, and eyes or polls for the same: British preferential tariff, 10 per cent; intermediate tariff, 35 per cent; general tariff, 35 per cent.
Edgar Nelson Rhodes: The importations last year were $963,000, $174,000 from the United Kingdom, $638,000 from the United States, $116,000 from Germany, and $16,000 from Sweden.


William Lyon Mackenzie King: There is an increase of 74 per cent in the intermediate and 5 per cent in the general tariff. Can my hon. friend give me the names of the industries in Canada which will benefit by this increased protection?


Edgar Nelson Rhodes: The tool makers are listed in the Canadian Trade Index as follows:
Accessories Manufacturers Limited, Montreal, Quebec.



[Stage Direction]
United Kingdom
Allard Machine and Tool Company, Toronto, Ontario. Amalgamated Electric Corporation, Limited, Toronto, Ontario.
Armstrong, Mervin, Toronto, Ontario.
Bridgeport Manufacturing Company, Bridgeport, Ontario.
Brown Engineering Corporation Limited, Toronto, Ontario.
Bryant, Pattern and Manufacturing Company, Limited, Windsor, Ontario.
Butler, William, Machine Company, Hamilton, Ontario.
Canadian Atlas Steels, Limited, Welland, Ontario.
Clark Machine Company, Thorold, Ontario.
Colonial Tool Company, Limited, Walkerville, Ontario.	_
Connor Machine Company Limited, Windsor, Ontario.
Dominion Rubber Company Limited (rubber machinery shops), Kitchener, Ontario.
Ford-Smith Machine Company Limited, Hamilton, Ontario.
Gibb's Tool and Stamping Works, Vancouver,
B.C.	. .	.	.
Hafer Machine Company Limited, Victoria, B.C.	^
Haliburton & White Limited, Montreal, Que.
Homer & Wilson, Hamilton, Ontario.
Jackson & Clark Limited, Vancouver, B.C.
Kartzmark & Sons, Hamilton, Ontario.
Lunn, G. J., and Company, Montreal, Que.
Milton Foundry Machine and Tool Company, Milton, Ontario.
Montreal Locomotive Works Limited, Montreal, Que.
National Steel Products Limited, Sherbrooke, Que.
Peerless Engineering Company, Toronto, Ontario.
Precision Tool Works Limited, Toronto, Ontario.	,
Pyramid Manufacturing Company Limited, Welland, Ontario.
Roelofson Elevator Works, Galt, Ontario.
Strom Machine Shop, St. Catharines, Ontario.
United Shoe Machinery Company of Canada Limited, Montreal, Que.
Whitfield, John Company, Limited, Toronto, Ontario.
Worth Machine Works, Toronto, Ontario.
Edward James Young: What was the production
in Canada?


Edgar Nelson Rhodes: The production in Canada
last year of saws was $877,000; axes. $529,000; drills of all kinds (tools), $346,000; drills- metal working, $18,000; punches and shears, $144,000.


Edward James Young: It seems quite an extensive
list of goods on which to have the price increased in order to grant this preference.


[Stage Direction]
Item agreed to.
Customs tariff-ex 438a, ex 438b, ex 438c. Motor vehicles, n.o.p., not including motor buses: British preferential tariff, free.
William Lyon Mackenzie King: How many
automobiles have been brought in from Great Britain and of what classes?


Edgar Nelson Rhodes: I shall have to give the
imports under the different headings. Under 438a we imported last year $223,000, of which $221,000 came from the United States. Under 438b we imported last year $2,557,000, of which $2,544,000 came from the United States and $9,000 from the United Kingdom, and motor trucks we imported to the value of $939,000, of which $849,000 came from the United States and S90.000 from the United Kingdom. Under 438c we imported last' year $1,037,000, $785,000 of which came from the United States and $239,000 from the United Kingdom.


Charles Marcil: What classes of automobile are we importing from the United Kingdom, costly cars or cars of medium value?


Edgar Nelson Rhodes: The largest list of passenger cars which came from England would be in the higher priced group, although there was a limited number of cheaper cars, namely, the Austin and Morris.


Charles Marcil: Does the government expect the cheaper cars will be replaced by English importations?


Edgar Nelson Rhodes: I should not like to say that. We are allowing for keener competition however and the English manufacturer will have his opportunity.


William Lyon Mackenzie King: There was a
time when all governments advocated the taxation of luxuries. This however seems an effort to admit luxuries free. The very expensive cars which only the wealthy may hope to purchase, are now admitted free of duty, whereas they used to carry 15 per cent. To my mind the only effect the change will have is to let in luxurious cars free of duty when in fact they represent a source of revenue we might have had. They could have been taxed under the head of luxuries.


Edgar Nelson Rhodes: If the right hon. gentleman's statement of fact is correct, and for the moment I shall not quarrel with it, his conclusion also is correct. He must remember this however that, assuming we do lose the impost on a few of the higher priced cars coming into Canada, the chances are far greater that it will be made up by income taxation from the increased earnings of companies now afforded a larger opportunity to do an export business. Canada is in a far better position to manufacture motor cars than any other portion of the empire, with the possible exception of Great Britain. This change gives us entry into larger markets.
1314	COMMONS
Imperial Conference-Trade Agreements


William Lyon Mackenzie King: Does the minister think any exception would have been taken if the government had asserted at the conference that they were quite willing to remove the duty on all cars except those of a highly luxurious type, and had asked that duty on such cars might remain? A satisfactory source of revenue would have been provided, and would have maintained the precedent of taxing luxuries where possible.


Edward James Young: I wonder if I understood the minister correctly. I understood him to say that the higher the profits our manufacturers could make, the more revenue we would have in income tax, and that therefore he was justified in enabling them to make as great a profit as possible at the expense of our people. I do not believe the minister really intended to subscribe to that principle. The other day when discussing one of these items I made the following statement:
This item shows an increase in the intermediate and general rates.
The preferential rate remained free.
According to the figures just given by the minister Great Britain in the past has practically dominated this market. I take it that the importations from Trance and Germany were of special varieties not produced in Great Britain. Why was it necessary to increase the rates in order to give Great Britain a further preference when she already controlled the market.
The Minister of Finance replied:
If those importations were of special varieties then they should pay something to the treasury of this country.
Then, later, I asked the following question:
I take it that the minister accepts the doctrine that special varieties of what we might call higher class goods should pay a higher rate than the more common varieties?
To that question the minister replied: Yes. I took it at that time that the minister subscribed to the doctrine that higher priced articles should pay a higher rate. It would .seem however that in connection with this article he is not living up to that doctrine.


Edgar Nelson Rhodes: That may be quite so,
Mr. Chairman. I have no quarrel with the argument my hon. friend is making in this particular instance which, as he no doubt will admit, is rather unusual. My answer is however that this is a conference agreement.


Edward James Young: Did anybody ask for it?


Edgar Nelson Rhodes: No manufacturer or individual asked for it. It arose out of the conference agreement.


Edward James Young: When the minister states so
frequently that nobody asked for this or that increase, but that it arose spontaneously from the agreement I am reminded of the time when Moses came down from the mountain only to find the children of Israel worshipping the golden calf. He turned to his brother Aaron and said, "What did these people unto thee, that thou hast brought so great a sin upon them?" And Aaron replied, "The people brought me their gold; I cast it into the fire and there came out this calf."


Alan Webster Neill: Which is Moses?


Edward James Young: The hon. member is saying this agreement arose spontaneously out of the conference, that it just came out.


[Stage Direction]
Item agreed to.
Customs tariff-440j.	Trawls, trawling
spoons, fly hooks, sinkers, swivels, sportsmen's fishing reels, bait and hooks, and fishing tackle, n.o.p.: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 30 per cent.
Alan Webster Neill: This is another item which
will affect adversely the interests of the commercial fishermen, although on the surface it would not appear to do so. The previous rates were 20 per cent under the British Preference, 25 per cent intermediate and 30 per cent general. Now, under this agreement the government makes the rates, free, 25 per cent and 30 per cent. As I say on the surface it would appear not to hurt the fishermen, but the fact is that it does. The reason is that there are one or two commodities included in this item which, through other items of our tariff, came in free from every country as a special concession to the commercial fishermen. I have not all those items before me, but I have one just a few pages over. We notice in the item the term n.o.p., which I believe is the short form of the term "not otherwise provided for." But this is not a Canadian tariff. This is a treaty being made with Great Britain, and the expression, "n.o.p." can apply only to those articles not otherwise provided for in this document or agreement.


Edgar Nelson Rhodes: No, no; my hon. friend is wrong in that assumption. The term n.o.p. is used in the item as it stands in the tariff today and as it will continue to stand.


Armand Renaud La Vergne: I must apologize to
the committee; I skipped item 438b concerning motor cycles or sidecars therefor.


Alan Webster Neill: I suggest we finish the item
we are discussing.

United Kingdom


Armand Renaud La Vergne: Very well.


Alan Webster Neill: The minister's suggestion is
that it refers to our tariff, but it does not say so. The expression is "n.o.p." which means not otherwise provided for. Our general tariff is not before the British government, and when the expression n.o.p. is used it must mean n.o.p. as regards this document. I believe trouble will arise in the future in this matter. This n.o.p. can refer only to the tariff before ns, or that limited tariff with which we are dealing today. We will suppose that these articles come in from the United States and we attempt to impose a tax of 30 per cent. Well, in those circumstances it is no argument for the fishermen to say that under item 682c the rates for swivels are free, free and free because after all this is a tariff arrangement with Great Britain; it is not an arrangement with the United States.
I submit there should be at least a definition that it is n.o.p. of the Canadian tariff. I should like to know how we are to get an article in free under item 682c of the customs tariff when a bargain has been made with Great Britain that such commodity shall carry a burden of 30 per cent. I ask the minister for a definite explanation of how he can make the expression n.o.p. apply to some other document not before us?


Edgar Nelson Rhodes: I believe I can give a clear explanation,-at least I trust I can. My hon. friend will observe these schedules are attached to the agreement, but the law as affecting the tariff will be based upon the tariff proposals as contained in the resolutions in committee of ways and means. This item will be dealt with there. The expression n.o.p. will have reference to our tariff, just the same as it does today. If my hon. friend will look up the item 440j in the existing customs tariff he will find precisely these same words, including n.o.p. I therefore wish to assure him that the n.o.p. has reference to our Canadian tariff.


Alan Webster Neill: It is in our ways and means committee, certainly, but what will the Britishers say? It will be misleading.


Edgar Nelson Rhodes: No, the Britishers thoroughly understand the situation as I have explained it.


Alan Webster Neill: I hope so.


[Stage Direction]
Item agreed to.
Customs tariff-438b. Motor cycles or sidecars therefor: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 30 per cent.
Edgar Nelson Rhodes: This is an entirely new item. It means we place motor cycles and side cars on the free list. Our importations last year were $241,000 of which $84,000 came from the United Kingdom and $156,000 from the United States.


[Stage Direction]
Item agreed to.
Customs tariff-441. Guns and rifles of a class or kind not made in Canada: British preferential tariff, 5 per cent; intermediate tariff, 27£ per cent; general tariff, 30 per cent.
Charles Marcil: If they are not made in Canada why do you put 5 per cent on the British preference?


Edgar Nelson Rhodes: We have reduced the British preference from 10 per cent to 5 per cent.


Charles Marcil: Why not let them in free?


Edgar Nelson Rhodes: Well, it is a fair revenue producer. Sporting rifles we felt should bear some tax.


[Stage Direction]
Item agreed to.
Customs tariff-445c. Electric telegraph or telephone apparatus and complete parts thereof:	British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 30 per cent.
Item agreed to.
Customs tariff-445d. Electric wireless or radio apparatus and complete parts thereof: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 30 per cent.
Charles Marcil: A great many of these
goods are made in Canada at present?


Edgar Nelson Rhodes: Yes, an increasing quantity, yet at the same time we imported a very large quantity last year, to the amount of $4,160,000.


William Lyon Mackenzie King: The old rate
of duty was 27i per cent; what was gained by raising it to 30 per cent? It merely means additional protection to the manufacturer, and he will pass that on to the consumer.


Edgar Nelson Rhodes: If one insists upon bringing the goods in under the general tariff he will have to pay 2i per cent more duty. On the other hand my right hon. friend will realize that under the British preference we have reduced it from 15 per cent to free.


William Lyon Mackenzie King: Assume the
consumer wishes to buy a Canadian article, he will just have to pay that 2i per cent additional.


Edgar Nelson Rhodes: My right hon. friend and
I will have to continue to disagree with respect to what will happen in that case.

Imperial Conference-Trade Agreements


Alfred Speakman: What percentage comes from the United States under the general tariff, and what percentage from Great Bri tain?


Edgar Nelson Rhodes: Last year we brought from the United Kingdom $42,000 and from the United States S4.0S6.000 and from Germany 830,000.
Mr. MARC1L:	Are the Canadian manufacturers of these machines satisfied with this arrangement?


Edgar Nelson Rhodes: They were not asked as
to their views.


Charles Marcil: I thought they had been
consulted.


Edgar Nelson Rhodes: No, they were not.


Charles Marcil: Were the English manufacturers consulted?


Edgar Nelson Rhodes: They may have been by
the British delegates, but not by us.


Thomas Merritt Cayley: Did you receive any protests?


Edgar Nelson Rhodes: I know of none.


[Stage Direction]
Item agreed to.
Customs	tariff-445e.	Electric storage
batteries, composed of plates measuring no>t less than eleven inches by fourteen inches and not less than three-quarters inch in thickness; complete parts thereof: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 27J per cent.
Item agreed to.
Customs tariff-445k. Flame proof electric switch gear, for use underground in coal mines: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 30 per cent.
Item agreed to.
Customs tariff-446. Electric steam turbo generator sets, 700 h.p. and greater of a class or kind not made in Canada, and complete parts thereof: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 25 per cent.
Item agreed to.
Customs tariff-446a. Steel bicycle rims, not enamelled nor plated:	British' preferential
tariff, free: intermediate tariff, 27i per cent; general tariff, 35 per cent.
Charles Marcil: Are these manufactured in Canada to any extent?


Edgar Nelson Rhodes: No.


Charles Marcil: Bicycles are made here in large quantities.


Edgar Nelson Rhodes: Yes, but the rims are imported.


[Stage Direction]
Item agreed to.
Customs tariff-446a. Golf shafts of seamless steel, coated or not, but not chromium plated: British preferential tariff, 10 per cent; intermediate tariff, 35 per cent; general tariff, 35 per cent.
Item agreed to.
Customs tariff-ex 446a. Bottles or cylinders of seamless steel used as high pressure containers for gas:	British preferential tariff,
free; intermediate tariff, 25 per cent; general tariff, 25 per cent.
William Lyon Mackenzie King: The old rate under the general tariff was 25 per cent, that has been raised to 35 per cent. What was the reason of the addition of 10 per cent tr a tariff already so high.


Edgar Nelson Rhodes: No, the former rates were 15, 27J and 35 per cent. The new rates, free, 25 and 25; a reduction all round. You should congratulate us.


William Lyon Mackenzie King: Yes, I do.


[Stage Direction]
Item agreed to.
Customs tariff-ex 446a. Steel balls, not larger than three-eighths inch in diameter, commonly known as "burnishing balls": British preferential tariff, free; intermediate tariff, 7i per cent; general tariff, 10 per cent.
Item agreed to.
Customs tariff-476. Surgical and dental instruments of any material; surgical needles; X-ray apparatus; microscopes valued at not less than $50 each, by retail: and complete parts of all the foregoing: British preferential tariff, free: intermediate tariff, 10 per cent; general tariff, 10 per cent.
Sir EUGENE FISET:: What was the value of the imports of these surgical instruments from Germany, the United States and France?


Edgar Nelson Rhodes: It is impossible to give the exact figures, but I will give the total importations of the parent item from which this item was extracted. It is part of total imports amounting to $1,458,000 of which $51,000 came from the United Kingdom, $1,216,000 from the United States, $123,000 from Germany and $46,000 from France.


Eugène Fiset: I wonder if the
minister realizes that this increase of ten per cent in intermediate and general affects, practically speaking, one province only, the province of Quebec. As the minister very well knows, the teaching in our medical schools in Quebec is based entirely on the French method and the teaching in the French universities. The whole of our professorial staff,

United Kingdom
as far as our universities and medical schools are concerned, have been taught in French universities; the descriptions of surgical operations contained in our technical books, including the instruments used, are altogether French. The students, the doctors graduating from these universities have been taught the French instrumentation. They have been taught nothing else. First they are taught the methods and then the use of the instruments, and you are simply exacting a premium from the practice of medicine and surgery in the province of Quebec. I mention Quebec particularly because we are practically the only province where French methods and French teaching are entirely followed. These surgical instruments include needles, x-ray instruments and microscopes. Do you realize that in our French universities and medical schools, as well as our French Canadian hospitals, and even in those medical units that have been organized recently, French instruments are used exclusively? We cannot exchange them for one very good reason. Two-thirds of the medical practitioners in the province of Quebec, especially those practising in the rural communities, do not read or understand English. Therefore it is impossible for them to substitute surgical instruments manufactured either in England or in the United States for the French instruments they have been using in the past, and it seems to me this legislation is going to place a great handicap on a profession which already is extremely handicapped in these times of stress. For these people a 10 per cent increase will make the price almost prohibitive as far as the purchase of French instruments is concerned. Surely the government is not so poor that by means of the tariff they must tax our universities, our hospitals, our medical men and so on. I am under the impression that under the heading of surgical instruments will come even those instruments which are used in our colleges for teaching the pupils. They are all of French manufacture, and the reason these articles were free under all tariffs in the past -was because of the fact that Quebec is in an extremely awkward situation in this respect. So I say that this tariff is simply a premium levied against our French Canadian medical profession.


Charles Marcil: I wish to support the
remarks of the hon. member for Rimouski Mr. Chairman. I have noticed in the French Canadian press several statements to that effect. For years the province of Quebec has been in the habit of giving scholarships to certain students who go to the universities
in Paris and come back to Canada with the knowledge they have obtained there. We all know that science would be very much poorer today if it were deprived of the knowledge which has been gained by French scientists. In Quebec we have many people who have been taught the French methods, and certainly they would be placed under a great handicap if they were penalized by this tariff. I hope the minister will find a way out.


Edgar Nelson Rhodes: I beg to assure my hon.
friend from Rimouski as well as my hon. friend from Bonaventure that this is the first time this aspect of the matter has been brought to my attention.


Eugène Fiset: That is exactly what I thought. Will the minister allow me one question? Were any consultations held with the college of surgeons of the province of Quebec, with the authorities in control of our French Canadian hospitals or with the medical profession of that province? I am rather surprised that the French Canadian representatives in the cabinet, particularly those from the lower part of the province of Quebec, have not entered a protest. I think this step is not justified. I do not think for one second that the government took this action wittingly; I am quite sure that the aspect of the case I have brought to the fore today has not been given due consideration.


Edgar Nelson Rhodes: My hon. friend did not permit me to conclude. I was going to say that since our friends in Quebec are compelled to use these French instruments for the reasons outlined by my hon. friend from Rimouski, who is thoroughly familiar with the matter, this seems to me to be a case in which they should receive some special consideration. I may say to my hon. friend that I think he has made out a reasonable case, and I can assure him that the matter will be examined with extreme care. We will discuss the question with the British authorities, as my hon. friend will appreciate we are compelled to do under the terms of this agreement, and if any amelioration can be arrived at which will meet the objection my hon. friend has in mind, we will be only too happy to see that it is done. The object we had in mind was not to increase the expense to the hospitals or the medical profession at all; our sole object was to deflect into empire channels purchases of this kind. I am not minimizing the force of the argument of my hon. friend; it would be sound if they imported only $100 worth of these instruments, but I might point out that out of a total importation last year under the parent item of $1,458,000, we im-
1318	COMMONS
Imperial Conference-Trade Agreements
ported from France only $46,000 worth, so the items under review here would entail much less than that amount.


Eugène Fiset: But the minister must remember that the French Canadian hospitals and universities are few in number.


Edgar Nelson Rhodes: I am saying that the blow would not be very heavy even if they were compelled to pay this 10 per cent, but I assure my hon. friend that the matter will be gone into with the British authorities to see if we cannot make an arrangement which will meet the objection raised by the hon. gentleman.


Mr. HOWDEN:: I am in entire sympathy with what the hon. member for Rimouski has just said. I have some knowledge of these things, because I happen to live and practise in a French Canadian district in Manitoba. I cannot entirely agree with my hon. friend, however, when he says that Quebec is the only province that will be affected by this measure.


Eugène Fiset: I said, "practically."


John Power Howden: I believe I am correct in saying that Swedish surgical instruments are the best on the market, and in the opinion of the medical profession where I come from certainly the next in order would be United States instruments. Instruments from these countries rank very highly in comparison with other surgical instruments, and to a very large extent they are used in our hospitals and by the medical men of the west.
This item is on a par with the other item referring to sera, toxins and so on, and to the other item covering surgical dressing. I might remind the committee that hospitals generally are charitable institutions which must be kept up by municipal and provincial grants and to a very large extent by donations from private individuals. I can assure you, sir, that hospitals generally are having a pretty hard time to get along just now. I might say a word for the medical men also, and assure the committee that at the present time they are not having a very fat time of it. These instruments and surgical appliances generally, together with dressings and other things, exact a pretty big toll from the average medical man, and a very large toll from the hospitals. I should have thought that in considering these items the government might have made good their revenues from other sources instead of taxing what are practically charitable institutions. There is no other institution in the land which gives so freely of its time, effort and expense in serving the people of Canada as the medical profession

and the hospitals. I think this matter should be looked into by the Minister of Finance and the Minister of Trade and Commerce.


Edgar Nelson Rhodes: I may say to my hon. friend from St. Boniface that he is assuming that of necessity this will involve an increased expenditure by the hospitals.


John Power Howden: That must be so in connection with X-ray apparatus.


Edgar Nelson Rhodes: I have had occasion to make some inquiries into the matter of X-ray apparatus, and that will not be the case.


Edward James Young: Why not?


Edgar Nelson Rhodes: My information, after some careful inquiry, is that the British X-ray apparatus today is the equal of any in the world. They have made tremendous strides in X-ray apparatus, particularly in connection with photography. In fact, they lead the world today to a marked extent.


Edward James Young: Do they tell you that themselves?


Edgar Nelson Rhodes: Our idea in this was not that the hospital should pay more but that we should buy from empire sources, and as a result of the agreement arrived at the British manufacturers of X-ray apparatus and equipment of that kind are today arranging to have in Toronto headquarters where they will have their machines on exhibit, and where there will be experts for servicing. As speedily as possible they propose to have a central distributing area in each of the provinces so that the matter of servicing will be taken care of. There is no question about either price or quality. My hon. friend has said that Swedish surgical instruments are the best in the world. I must say that he is reflecting upon the members of his profession if that is so, because we do not import any from Sweden.


John Power Howden: I can assure the minister that I have bought a considerable number of Swedish instruments myself and they are the most expensive instruments in this country.


Edgar Nelson Rhodes: I can say to my hon. friend that they must have come from the United States-


John Power Howden: Maybe.


Edgar Nelson Rhodes: -because there were no importations from Sweden. I do not know that there is anything more I can say except that we have every hope and expectation of being able to supply the hospitals with these commodities from empire sources at no increase in price.

!*T
United Kingdom


John Power Howden: The Minister of Finance will have a very hard time convincing the medical men in our part of the country that the British X-ray apparatus is the best on the market.


Edgar Nelson Rhodes: My hon. friend must not misunderstand me; I said so far as X-ray photography was concerned they led the world. As regards the apparatus itself, I said it was the equal of any in the world.


John Power Howden: I can assure the minister that the western hospitals are to a very large extent equipped with American and European X-ray apparatus, German and French. Those that are already installed will from time to time require new tubes and other repairs, and there is no doubt that the increase in the tariff, intermediate and general, on these articles is bound to result in an increase in the cost of operating hospitals as well as in cost to medical men. We might ask the Minister of Railways what he thinks about it, but I suggest that this article might well be taken in conjunction with the articles of surgical dressings and sera. These three articles will cost the hospitals and medical men and as well the people of this country decidedly more. There is no doubt about that.


Alfred Speakman: I would not take up
the time of the committee discussing this matter but I was asked by a medical friend, rather a well known man, whether I would present this statement to the committee as a matter of general principle applicable to questions such as the one now under consideration. His view is that in connection with instruments or medicine or any of those things upon which the lives and the health of the people directly depend, the first consideration should be not any question of business, not any question affecting the individual or the country producing or selling the commodity required, but that rather, in matters where the lives and the health of the people are directly concerned, the sole consideration should be the ability of those who require such instruments to get them where they can best be procured and at the cheapest price. That consideration alone should prevail. The opinion which this gentleman expressed was certainly that it would increase the cost or else force them to buy what they might not regard as equally suitable for the purpose. The principle he laid down, which in my opinion is a sound one, was that in such matters it was not a question of ordinary business but that the lives and the health of the people should take priority of any
other consideration, and medical men should be able to buy the instruments they liked best at the cheapest prices. I pass that on to the consideration of the minister because I believe that the principle enunciated is absolutely sound.


[Stage Direction]
Item agreed to.
Customs tariff-488. Nitrate and acetate of lead, not ground; platinum and black oxide of copper, for use in the manufacture of chlorates and colours: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 10 per cent.
Edgar Nelson Rhodes: The total imports last year were 867,000, of which $14,000 came from the United Kingdom and $51,000 from the United States.


[Stage Direction]
Item agreed to.
Customs tariff-522.	Rovings, yarns and
warps wholly of cotton, not more advanced than singles, n.o.p.: British preferential tariff, 12J per cent; intermediate tariff, 15 per cent; general tariff, 22i per cent; and, per pound: British preferential tariff, 2 cents: intermediate tariff, 3J cents; general tariff, 4 cents.
Edgar Nelson Rhodes: The total imports last
year were $13,000 under this item, of which $8,000 came from the United Kingdom and $4,000 from the United States.


[Stage Direction]
Item agreed to.
Customs tariff-522c. Rovings, yarns and warps wholly of cotton, including threads, cords and twines generally used for sewing, stitching, packaging and other purposes, n.o.p.; cotton yarns wholly or partially covered with metallic strip, generally known as tinsel thread: British preferential tariff, 15 per cent; intermediate tariff, 22J per cent; general tariff, 25 per cent; and, per pound: British preferential tariff, 2 cents; intermediate tariff, 3\ cents; general tariff, 4 cents.
Edgar Nelson Rhodes: The total imports last year were $327,000, of which $76,000 came from the United Kingdom, $185,000 from the United States and $53,000 from France.


[Stage Direction]
Item agreed to.
Customs tariff-522d.	Yarns and warps
wholly of cotton, mercerised, number forty and finer, imported by manufacturers to be further manufactured in their own factories: British preferential tariff, free; intermediate tariff, 25 per cent; general (tariff, 25 per cent.
Item agreed to.
Customs tariff-ex 522. Yarns and warps wholly of cotton, number forty and finer, when imported by manufacturers of mercerised cotton yarns for use exclusively in the manufacture of mercerised cotton yarns, in their own factories- until December 31, 1933: British preferential tariff, free; intermediate tariff, free; general
1320	COMMONS
Imperial Conference-Trade Agreements
tariff, free; thereafter:	British preferential
tariff, free; intermediate tariff, 15 per cent; general tariff, 15 per cent.
Mr. FACTOR:: What does this mean,
"until December 31, 1933"?


Edgar Nelson Rhodes: They may be imported
free until that date, and thereafter the rates will be as specified. That is in accordance with the agreement, to enable the completion of an industry which is being established in Canada to manufacture them.


Edward James Young: Did they ask for it this
time?


Edgar Nelson Rhodes: This is a matter of agreement, and was in being.


Edward James Young: Where is the industry
located?


Edgar Nelson Rhodes: In Guelph.


Edward James Young: Owned by whom?


Edgar Nelson Rhodes: It is a branch of one of
the biggest industries in the world, Aberfoyle.


Edward James Young: They didn't ask for this.


Edgar Nelson Rhodes: I am not suggesting that
they did not ask for this because they certainly did, but the agreement was made long before the conference.


Edward James Young: This is one case where the Canadian manufacturer did ask for something.


Edgar Nelson Rhodes: We had to make good our undertaking and the British agreed that they would recognize it.


Thomas Merritt Cayley: Who made this agreement before the conference?


Edgar Nelson Rhodes: It was agreed between
the Canadian government and this industry that we would admit their goods free until such time as they were in position to manufacture.


Thomas Merritt Cayley: In what year?


Edgar Nelson Rhodes: They were in discussion
with the government for at least two and probably six months prior to the conference.


Thomas Merritt Cayley: There were some parties
interested in this agreement who had the privilege of interviewing the government.


Edgar Nelson Rhodes: My hon. friend misunderstands me entirely. This agreement was made apart altogether from the conference and it had to be recognized in honour when we came to the conference agreements.


Thomas Merritt Cayley: It was not discussed at the conference?


Edgar Nelson Rhodes: No.
[Mr. Rhodes.}


Thomas Merritt Cayley: I mentioned this morning
that the farmers had not been given a chance to interview the government in order to make their wishes known as to what they desired to be in the treaty agreements but here is a case where evidently-


Edgar Nelson Rhodes: I cannot allow my hon.
friend to make that deduction. The farmer has the same right to make representations to the government as has anybody else and he has never been denied an opportunity of doing so. This agreement was made long before the conference and my hon. friend is now saying that because we dealt with these people at that time we dealt with them in a different way with respect to the conference. We have done nothing of the kind.


Thomas Merritt Cayley: In most of the answers
to my queries the minister stated that no one was consulted, that it was just a matter of agreement.


Edgar Nelson Rhodes: Yes.


Thomas Merritt Cayley: That is not so in this
case.


Edgar Nelson Rhodes: This agreement arose prior to the conference which had nothing whatever to do with it.


Charles Marcil: From what I read in the
Montreal papers I understood that conferences were held between Canadian and British manufacturers long before the imperial conference took place, and that the arrangements arrived at were submitted to the government. Is there anything in that?


Edgar Nelson Rhodes: There were any number
of conferences of various kinds between different interests, but that had no reference to this agreement at all.


[Stage Direction]
Item agreed to.
Customs tariff-523. Woven fabrics wholly of cotton, not bleached, mercerised nor coloured, n.o.p., and cotton seamless bags: British preferential tariff, 17J per cent and 2 cents per pound; intermediate tariff, 20 per cent and 3J cents per pound; general tariff, 25 per cent and 4 cents per pound.
Henry Elvins Spencer: What was the old
schedule?


Edgar Nelson Rhodes: This is a straight deduction of one cent per pound under the British preferential.


[Stage Direction]
Item agreed to.
Customs tariff-523a. Woven fabrics wholly of cotton, bleached or mercerised, not coloured, n.o.p.: British preferential tariff, 20 per cent

United Kingdom
and 2 cents per pound; intermediate tariff, 224 per cent and 34 cents per pound; general tariff, 274 per cent and 4 cents per pound.
Mr. TOTZKE:: What is the difference in
this item?
Mr. RHODES;	We have reduced the
specific rate one cent per pound.


Albert Frederick Totzke: What was the tariff prior
to 1930?


Edgar Nelson Rhodes: Fifteen, twenty-two and a half and twenty-five per cent.


Henry Elvins Spencer: What were the imports?


Edgar Nelson Rhodes: Our total imports last
year were valued at $1,049,000, of which $575,000 came from the United Kingdom, $426,000 from the United States, and $33,000 from Switzerland.


[Stage Direction]
Item agreed to.
Customs tariff-523b. Woven fabrics wholly of cotton, printed, dyed or coloured, n.o.p.: British preferential tariff, 224 per cent and 2 cents per pound; intermediate tariff, 274 per cent and 34 cents per pound; general tariff, 324 per cent and 4 cents per pound.
Charles A. Stewart: What were the imports?


Henry Herbert Stevens: Our imports were valued at $5,343,000, of which $2,365,000 came from the United Kingdom, $2,108,000 from the United States, $239,000 from Italy, $219,000 from Czechoslovakia, $170,000 from Belgium and S81,000 from France.


Thomas Merritt Cayley: What is the Canadian production?


Henry Herbert Stevens: The production is not completely classified. The production of denim is valued at $1,255,000; of ducks and drills, $1,756,000; of flannelette, $1,750,000; of gingham, $200,000; of shirtings, $1,500,000, of other prints, $6,376,000 and not specified, $4,500,000.


Charles A. Stewart: I think this item proves conclusively that the Canadian manufacturer does take full advantage of any protection. It will be found that the imports from the United Kingdom have run along fairly steadily despite the fact that hon. gentlemen have increased the duty very materially. To my mind this is a clear indication that the Canadian manufacturer takes full advantage of the protection afforded him, otherwise the Britisher could not sell a dollar's worth in Canada. When the depreciated currency is taken into consideration, the total duty against the British importer is something like 58 per cent. That is the price the Canadian consumer must pay for these 53719-84
excessive duties. I am not complaining of the imports from England but I do say that this is a clear, concrete case of soaking the consumer. The trade is doing it to the fullest extent and my hon. friends know that this is one of the items which enter largely into the requirements of the homes throughout the country.
I do not intend to say anything more in connection with these textile items but I must comment upon the care taken by hon. gentlemen opposite to see that this industry receives the maximum protection, amounting almost to exclusion. I think it is grossly unfair to the consuming public that such protection should be given. In 1930 we were told that extra duties were being imposed in order to provide employment in Canada but I am informed that the result has been that under one-half of the employees are now working. I protest as vehemently as I possibly can against these excessive duties placed upon an article so important in the lives of the Canadian people.


Frederick George Sanderson: What were the rates prior to 1930?


Henry Herbert Stevens: On piece, dyed cottons the rates were twenty, twenty-five and twenty-seven and a half per cent, and on yarns, dyed, twenty, twenty-five and thirty per cent.


Albert Frederick Totzke: No specific duty?


Henry Herbert Stevens: No.


[Stage Direction]
Item agreed to.
Customs tariff-523, 523a and 523b. Woven fabrics wholly of cotton, composed of yarns of counts of 100 or more, including all such fabrics in which the average of the count of warp and weft yarns is 100 or more: British preferential tariff, free; intermediate tariff, 274 per cent and 34 cents per pound; general tariff, 324 per cent and 4 cents per pound.
Mr. HEAPS:: I would ask the minister
what factors are taken into consideration in granting protection to a Canadian industry.


Henry Herbert Stevens: I am very glad my hon.
friend has asked that question because it was fully considered when these matters were under consideration. One of the factors considered is the cost of raw material, but the main factor entering into this particular industry is the difference in labour costs in Canada as compared with other countries producing this article. The other factors considered are the normal factors of commerce such as overhead and the usual charges, but the two main factors are cost of labour and cost of raw material.

1322	COMMONS
Imperial Conference-Trade Agreements


Abraham Albert Heaps: Does not the raw material
enter this country free?


Henry Herbert Stevens: In this case, yes.


Abraham Albert Heaps: What is the difference in
labour costs in Canada and Great Britain, which happens to be a competitor in this commodity?


Henry Herbert Stevens: I have not that information here, but when this matter was under discussion I brought the British representatives into close and direct contact with the representatives of the industry here, and we had them visit various plants in Canada. There is a difference in the way the industry is carried on here and in the old country. The machining part of it is somewhat different, and the labour factors are not on an exact parity. So far as they were comparable wages in this country showed a marked appreciation over those in the old country. I recall, and my hon. friend will recall, that he put on Hansard and I put on Hansard in days gone by comparative statements of labour costs here and in England, and roughly, as I recall, they were about double in Canada as of that day. But on close examination it is shown that this comparison is not as accurate as might appear on the face of it. I can merely say this, that the labour factor is an important factor, and while it is not exactly comparable due to the different methods followed in Great Britain, my hon. friend can rest assured that the labour cost is much higher here than in Great Britain.


Abraham Albert Heaps: 
Henry Herbert Stevens: 
Mr. MALCOLM:: Possibly there was a loss in inventory.


Henry Herbert Stevens: There might have been, but generally speaking it can be taken for granted that there was a loss in operation of that amount.


Edward James Young: Possibly they were not
operating at all.


Henry Herbert Stevens: No doubt the hon. member can find many things which might have happened, but I am attempting to speak in broad general terms of economic law which enters into a matter of this kind.


James Malcolm: I think the minister will admit that the loss in industry during the past two or three years has not necessarily

been an operating loss. Shrinkage in inventory values has caused terrific losses.


Henry Herbert Stevens: No doubt that is true. However it indicates a loss in operation, whether by inventory or in cost of manufacturing. As a corollary of that we know that goods are being offered on the world's market at figures with which the normal cost of production cannot compete. My hon. friend opposite who has had wide experience in business will agree with that. That is the position with which we in Canada were faced. There were certain industries established employing large numbers of persons; that condition applied to the cotton, woollen and textile industries generally. A very substantial number of persons were employed. The government could have taken another course; we could have stated, "Well, we will do nothing; we will let the tariff stand as it is. Let industry sink or swim under that protection." Had we done so there can be no doubt that the textile industry would have been wiped out in Canada, because other countries in their struggle to preserve industry were willing to sell goods, whether they were inventory or newly manufactured goods, at sacrifice prices. We, however, chose the other course; to impose sufficient tariff protection to preserve that industry through this emergency. I agree that the wisdom of that course is open to question, some may say we should have taken the other course. As a matter of fact we took that course.
Hon. gentlemen are quite right in asking what we propose to do. This is what we propose, and it is clearly set out in the agreement. In the first place we have reduced the duty by practically one cent a pound to Great Britain through this list of specific taxes. But we propose to give to the British competitor of the Canadian industry access to the tariff board in this country, he is at liberty there to make whatever case he can to show that there is unfair protection.


Frederick George Sanderson: Would the minister
permit a question?


Henry Herbert Stevens: Yes.


Frederick George Sanderson: Why did not the government form the advisor}' tariff board before the conference, then they would have had full information.


Henry Herbert Stevens: Well, I do not wish to be distracted into a discussion of that; my hon. friend may criticize that. I will quote the article:
Article II. His Majesty's government in Canada underbake that during the currency of this agreement the tariff shall be based on the

United. Kingdom
principle that protective duties shall not exceed such a level as will give United Kingdom producers full opportunity of reasonable competition on the basis of the relative cost of economical and efficient production, provided that in the application of such principle special consideration shall be given to the case of industries not fully established.
That reservation does not apply to the cotton industry now under discussion. Furthermore :
Article 13. His Majesty's government in Canada undertake that on the request of His Majesty's government in the United Kingdom they will cause a review to be made by the tariff board as soon as practicable of the duties charged on any commodities specified in such request in accordance with the principles laid down in article 11 hereof and that after the receipt of the report of the tariff board thereon such report shall be laid before parliament and parliament shall be invited to vary wherever necessary the tariff on such commodities of United Kingdom origin in such manner as to give effect to such principles.
I do not know of any process that could be fairer than that. We feel that the duties on textiles in this country are high, there is no disputing that-


Frederick George Sanderson: A frank admission!


Henry Herbert Stevens: But we were confronted
with a condition, and had to make a choice, and during this period of depression we felt it was not justifiable to adopt a course which would inevitably close a large number of these plants and throw more people out of work. I submit that having in mind this emergency condition of the last two years, it was better to keep these plants going, and consider these broad economic questions later. I think my hon. friend will agree with me that that was the better course.
Now my hon. friend asks me in regard to wages. I have already intimated, and I cannot emphasize this point too much, because I happen to have been in touch with the British authorities who discussed and considered the matter, that it is not possible to make a fair comparison of wages between Great Britain and Canada. My hon. friend knows, for instance, that in the Canadian mills an operative will have charge of a larger number of looms than in the old country. So that while the nomenclature of the task may be the same, in Canada the actual number of looms tended by one operator may be larger, and it may be argued that that justifies the differentiation in wages. But the point intervenes there that in Canada there is more extensive mechanization, and greater limitation of manual labour. In other words in Great Britain they have limited mechanization to a certain degree as compared
with Canada. So the comparison is difficult. Another point to keep in mind is one that my hon. friend himself referred to. In Great Britain the cotton industry is perhaps one of (he most highly organized from a labour standpoint. Union requirements over there prescribe a limitation of the number of looms and of the degree to which mechanization may go. In Canada there is a different situation.
My hon. friend asks me also: Do I think it is fair that the rate of wages which he quoted should be paid in Canada? I would not wish to subscribe to the statement that it is fair, I have not given the matter specific study. I think it ought to be very carefully studied, and I believe it will be. But after all that is a matter which comes under provincial jurisdiction, because the minimum wage law is a provincial law. For the sake of the discussion here I am assuming that the provincial authorities in Quebec have examined this matter and are satisfied. I would suggest to my hon. friend that it is scarcely fair to quote the wages paid to what might be called apprentices. He will agree with me that a person tending a machine will become much more nimble after six or twelve or eighteen months than in the first few months.


Abraham Albert Heaps: I quoted them all.


Henry Herbert Stevens: Yes, but I am pointing out that for purposes of comparison the first six months or so ought not to be taken into consideration. But as regards the fairness of the wages paid under the Minimum Wage Act in the province of Quebec, I would not wish to offer an opinion now. I say to my hon. friend, that can well be disclosed by those interested in the labour question when the matter comes before the tariff board. I am authorized to say this, that it is the intention of the Dominion government that as soon as the tariff board is organized, or as soon thereafter as possible, this whole question shall be reviewed by that board.	We know it is
complex, we know it is difficult, we know that there are a great many interests in Canada concerned,-when I say that I am thinking more of employees than of the textile industry from an investment standpoint, because I frankly confess that I am not interested in that in any way. I am interested, however, in the existence or perpetuation of the industry in this country, if possible. I do not wish to see towns in Quebec and Ontario, the two provinces chiefly affected,- there are some in the maritimes and I think possibly some in a small way on the Pacific coast-I do not wish to see these towns and villages or the industries that sustain them

Imperial Conference-Trade Agreements
injured unnecessarily. I want to make that clear.. L think most of the employees in them are happy as long as they can secure employment,- and. let us bear this in mind that in this industryi . there is a better rate of employment 'today, as far as continuity is concerned; than in any other class of industry.


Abraham Albert Heaps: What hours are they working at present?
Mr, STEVENS: I cannot tell.
1 Mr. HEAPS : More than three or four days a week?


Henry Herbert Stevens: Oh yes, I know that in [DOT];many of these: industries they are working full tirne, and. some of them are working twenty-four hours a day. Of that we can get further particulars. But I think my hon. friend fan take it that in this textile industry, generally speaking, the extent of employment is greater than in any other class of industry. In, itself that, is a,good thing in these days, and the question of whether they could carry on as at present or whether they should be laid bare, to competition is one which we submit will be subjected to the scrutiny of the tariff board.


Charles A. Stewart: Can my hon. friend state how many are employed in the whole textile industry?


Henry Herbert Stevens: I have the figures for the cotton textile industry. The number of employees was 18,500, and the salaries and wages paid total 814,500,000.


Abraham Albert Heaps: Have you the salaries and wages separate?


Henry Herbert Stevens: No, I have give the figures I have here:
. Number of plants	
Capital invested	
Number of employees	
Salaries and wages	
Value of product	
not. I will

Those figures have reference to the cotton textile industry. I think perhaps we can get the figures for the other industries if they are required, but there is no question that in the textile industry generally there is a very excellent standard of employment so far as continuity of work is concerned.


Thomas Reid: But is the minister aware that in 1919 it was sworn before a parliamentary committee that this industry made a profit of 291. per cent, and that 85,000,000 worth of stock was purchased for only $500,000?


Henry Herbert Stevens: 
Abraham Albert Heaps: 
Henry Herbert Stevens: I thought I made that fairly clear. 1 said there were two main Jactors, the cost of raw material and the
labour cost. Then I said there must be considered also the usual factors which enter into such operations, the usual overhead charges such as interest on capital, light, heat, power, taxes and so on.


Abraham Albert Heaps: All these things make it
so much worse for this item. A few years ago I happened to be in the centre of the textile industry in Great Britain, and the cost there for light and power was considerably higher than the cost in Canada. Then there is the question of the cost of raw material. As I have already pointed out, that is also against production here; the British manufacturer is compelled to buy his raw material in the United States market at a depreciated rate of exchange and ship it to Great Britain. Our dollar is at a considerably higher value than the English pound and consequently our manufacturers have an advantage over the British manufacturers in the exchange situation. When the British manufacturer attempts to send his finished product into Canada he is taxed first of all on account of the American exchange and then he has to pay a dumping duty in Canada. In the third place, as the minister pointed out, in the matter of machinery they are far more up to date in Canada than in Great Britain. That is absolutely true and that is why labour costs in Canada are lower than they are in Great Britain. Therefore if the argument is that owing to raw materials and labour costs we are compelled to give the manufacturers 75 per cent or something approaching that figure in the form of protection, then I cannot see anything in that argument and I think he can afford to compete almost without protection at all. But my main contention is that in the wages paid to industry in Great Britain during this whole period there has been comparatively a slight reduction, whereas our girls are earning the most miserable pittance, one which in my opinion ought not to entitle industry to one iota of protection until such time as the employees are enabled to enjoy a reasonable standard of living.
We are told that this matter will go before the tariff board and that all these arguments can be presented there. We are told that the tariff board will hear representations and adjudicate upon them and pass judgment. I remember the arguments which a few years ago, when the tariff board was functioning in this country, were advanced by some gentlemen who now sit to the right of the Speaker. They said then that the tariff board was the mouthpiece of the government. I wonder how much different it will be when there is a new tariff board in operation. I had hoped
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to have a very definite declaration from the Minister of Trade and Commerce and the Minister of Finance that the protection given to this industry would operate much in the same way as it did in connection with Besco a few years ago, and that unless the employees were provided with a decent standard of living, decent wages and decent conditions to work under, then the protection would be wiped out, just as these hon. gentlemen said when they were in opposition. So far the minister has shelved the responsibility on the tariff board. He can do better than that if he wants to, because when he was sitting on the left of the Speaker he waxed eloquent on the $100 a month minimum. The wages in the textile industry, as worked out by some of my friends on the basis of all those employed, from Sir Charles Gordon downwards, amount to about $60 a month, and for the sake of giving these employees $60 a month we have to give a protection ranging as high as 100 per cent.


James Shaver Woodsworth: My colleague has so fully covered the ground and has answered so well the statement of the Minister of Trade and Commerce that very little remains to be said, but I should like to emphasize one or two points. The minister spoke about the reduction in capital structure in the textile companies of the old land. Everyone knows that there was overcapitalization there. In the old country, however, it seems that they were able to protect the standards of the workers to a certain extent; the employers had to take certain losses. In this country, cn the other hand, we have in the textile firms a splendid example of watered stock- not merely overcapitalization but absolutely fictitious capitalization. Some hon. gentlemen may remember that a few years ago the history of some of these textile firms was placed on Hansard by the hon. member for Beauharnois, and so startling were those figures that when one newspaper in Montreal published them it was immediately intimidated with the threat that the advertising would be withdrawn if the publication of the figures were continued. That illustrates how strong these textile industries are and how ruthless -yes, and as the hon. member for Bow River suggests, how free the press is. The fact is the companies were afraid to face the publicity.
The minister may talk as much as he likes about normal costs, but normal costs in this connection imply costs under a condition of highly-inflated capitalization. That is what normal costs have meant in this country, and this it seems we must keep up.


Henry Herbert Stevens: No statement of mine justifies that last observation.


James Shaver Woodsworth: I think the implication is there.


Henry Herbert Stevens: Not at all


James Shaver Woodsworth: The inference is that the costs in the past were what were termed normal costs and that now difficulties are being encountered. Special help must be given. I say that the normal costs were those that were based on a capital structure that cannot be justified under any proper conception of ethics. We are starting with that false basis and attempting to keep to that line at whatever cost. Our contention has been that the protection of industry is no guarantee whatever of the protection of workers engaged in that industry. Go to the United States and you will find that the most highly protected industries there, the textile industries, have been precisely the industries that over a long period of years paid the lowest wages.
The minister makes a special plea for the textile industry on the ground that we are in the midst of an emergency. But similar action has been taken in Canada almost since confederation and is continued now in the present depression. One would imagine however that since there is a depression, if industry is to be protected the workers in industry should also be protected. I read to the house a little earlier in the session advertisements which were being put out by the city of Montreal showing that Montreal was an excellent labour market-why? Simply because they had a rather subservient native labour group and secondly because they had a very heavy influx of poor immigrants eager to obtain jobs however low the wages might be. That advertisement was put out by the city of Montreal. The same kind of advertisement was published by the Montreal Light, Heat and Power Company. Here we have a population who have not yet been able to obtain protection through trade unions, and who are unable to obtain protection at the hands of this house.
It does seem to me that even though we are told that the terms of the treaty cannot be altered, we have a certain responsibility to our own people in Canada. I quite admit that it is difficult to make a fair comparison between conditions in this country and in Great Britain, but I would remind you, Mr. Chairman, that in the old country they have unemployment insurance, they have a much better old age pension act, they have sickness insurance and provision for a great many social amenities about which we know nothing

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whatever in this country. In the province of Quebec, where many of the textile factories are located, they have not yet even adopted many of the schemes that have been adopted in other provinces of the dominion. So there is another side to this matter of comparison.
The minister takes the position which has been taken by the treasury benches ever since I became a member of this house, he shelters himself behind the British North America Act and says: we cannot do anything because some of these matters come under provincial jurisdiction. I do not think that that is a fair position to take. We have it entirely in our power when granting protection to stipulate the conditions under which such protection will be given. There is not the slightest doubt about that, and that argument has never been controverted. It is beside the mark to say that this matter must be attended to by the minimum wage board of the province of Quebec. We are granting special privileges and I contend that it is our absolute right under the British North America Act to state the conditions under which those privileges shall be granted. We must remember that the general public is being taxed very heavily in order to protect these industries and the general public ought to insist that there should be at least some protection for the w'orkers. We come back to the point made by my colleague and which I think the minister has skilfully evaded, that protection for industry should be made contingent upon a decent standard of living for the people engaged therein.


Mr. POULIOT:: Mr. Chairman, this item
brings up the whole matter of protection. I remember the special session of 1930 when the right hon. the leader of the government (Mr. Bennett) said: we will give protection to the industries in order that they may keep their men at work-a promise which was made not only to this house but to the country as well. The Prime Minister made that statement from his seat in which we so seldom see him. What is protection? We hear about the Prime Minister protecting everyone, protecting those who are old and those who are young, protecting the men and protecting the women, protecting the rich and protecting the poor, protecting those who have beards and those who are clean shaven. He protects everyone, but what happens finally? We begin to realize that what he has said may have sounded very nice but there is nothing behind it. Now is the time to think, now is the time to place the real facts before the committee in order that we may see the situation as it is.
I should like to offer my sincere sympathy to the colleagues of the Prime Minister whose remarks are never listened to. Hon. members opposite have not the courage to say to the Prime Minister what I would say were I in their place.


Some hon. MEMBERS:: Oh, oh.


Jean-François Pouliot: Instead of speaking to
me, why do they not speak to him? Surely they have his ear; surely they can tell him that the people should be protected. Protected against what? Protected against the big interests that exploit the people more than they have ever been exploited before. I know some manufacturers, I have spoken to them about protection and asked them why they insist upon having protection. The answer has always been: We do not need it but we try to get as much as we can. That is what is behind the petitions they always present to the government. They should let the government alone in order that the Prime Minister and his colleagues may have time to think not only of those who control these special interests but of their partners, the workingmen. Without the workingmen the manufacturer can do nothing.
When we advocate the rights of the people, what are we told? We are told that the Liberal party is spreading communism throughout the country. I say to the Prime Minister through Hansard, because we do not see enough of him in the chamber, that he himself is offering the strongest excuse for communism. He forgets that the working classes of this country must be protected by the government of which he is the leader. I am sorry to have to speak in this manner but I am not a rubber stamp; I feel it my duty to express freely the sentiments of the electors who have honoured me with their confidence. I speak here as a free man to a man who is free to do that which is best for the interests of this country but who is not free to follow a stupid policy which will bring the country to ruin.
The Prime Minister stated that high tariffs would increase employment, but there would be just as many people employed in this country as there were when he took office. What happened? Yesterday the Minister of Labour stated that 800,000 people out of our total population of 10,000,000 were receiving relief from this government. This is only one phase of the situation. Not only are
800,000	unemployed in distress during these dire times, but there are those who work for mere pittances. I might mention the railway employees who though still on the pay-roll are receiving only a small fraction
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of their former decent salary. Many of these men only have one period of work every three months.
What about Dominion Textiles, that mushroom industry? Other industries, such as the pulpwood industry, obtain their materials in this country, but it is an entirely different matter with the Dominion Textiles. They import their cotton from outside and they now enjoy very considerable protection. Is this company now employing as many people as they promised the Prime Minister in 1930 they would employ? It is very important that we should have this information in order to find out whether or not the management of this concern is true to its word.
Mr. Chairman, I do not think you were a member of the house when I advocated the payment of reasonable wages in the province of Quebec, in which move I had the support of man}7 hon. members. I was not asking for high wages-I am an advocate of moderation -all I wanted was a reasonable wage for the workingman in order that he might live in some comfort, in order that he might have sufficient money to provide food for himself and his family, in order that he might clothe himself and his family and be able to send his children to school. The managers and board of directors of the Dominion Textile Company have no heart. They want their employees to work for them for nothing. They treat them like slaves, and is there any guarantee now that they will be treated any better in the future? Is there any guarantee, in spite of the promises which have been given to the leader of the government in writing, that those who are unemployed will be given work? Will they fulfil their promises? Will they keep on their pay-rolls the men they now have and the men who were struck off and who need work?


Mr. GARLAND (Bow River):: Will they?


Jean-François Pouliot: That is the question.


Mr. ROBINSON:: Did your Prime Minister keep the promises he made in 1919 to the people?


Jean-François Pouliot: In 1919 the Tories were in power and Sir Robert Borden was the Prime Minister.


Sidney Cecil Robinson: Well, your leader, then?


Jean-François Pouliot: I respect my leader because he never promises anything that he cannot do, and he also realizes that he is human and never thinks that he is superhuman or a demigod. That is the difference between the two leaders in this house.
IMr. Pouliot.l
There is another aspect of this question. This country, you and I, Mr. Chairman, and everyone in this house, and everyone outside of it, are being asked to protect this mushroom industry. These new items mean that the Dominion Textile Company will get more profit from the tariff, but no more employees will be put on the pay-roll. My hon. friend from Bow River knows that, and I know it, because I know the directors of that concern. In the end, because protection must be afforded to the greater number, parliament will have to vote huge sums of money to give direct relief to these people who are out of work. Instead of the Dominion Textile Company doing its duty, living up to the solemn promise that it made to the leader of the government, we the members of the House of Commons will be asked to vote sums by way of direct relief to people who suffer because their employers have not kept their word. It is a serious matter, and the money that we shall be asked to vote is the people's money.
Another thing that will result from this preference is that the Dominion Textile Company will charge more for their goods, in violation of their undertaking not to charge more if the tariff was raised. You heard that promise, Mr. Chairman, because you were in the house at the time, that if the tariff was raised prices would not be increased. But the Dominion Textile Company will charge higher prices, and you and I when we buy their goods in any store will have to pay more, but the employee will not get any more wages. The directors will put additional profits in their pockets. That is the whole story.


Mr. SPOTTON:: All right, sit down, then.


Jean-François Pouliot: I will surely not sit down, because it is a case where the teacher is now my pupil, and the teacher has a lot to learn. I am sorry, Mr. Chairman, to speak in that way to a gentleman who is a little older than I am.


George Spotton: The hon. gentleman said
that that was the whole story, and I simply suggested that if that was so he might sit down.


Jean-François Pouliot: It is the whole story. It is an exposition of the facts. But now let me draw my conclusions. I ask you, Mr. Chairman, is this country ready to pay more for clothing just in order to give more money to Sir Charles Gordon and the directors who surround him in the Dominion Textile Company? I know that Sir Charles Gordon was the chairman of the committee in charge of

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raising the last loan. He was supposed to do very well, but the loan took a long time to be subscribed. Of course, I know that that was not his fault. As president of the Dominion Textile Company he enjoys a preference greater than is granted to anyone else by this government. So much is that the case that in January last the Montreal Gazette published a supplement giving the views of all the prominent industrialists in this country, and while there was no interview from Sir Charles Gordon, there was one from another Mr. Gordon, who is one of the officers of the Dominion Textile Company, and amongst all the contributors to that supplement Mr. Gordon was the only one who said that protection during the last year had helped his industry a lot. It has helped him personally, Mr. Chairman, but it did not help his industry at all.
It is a very sad state of affairs, Mr. Chairman. I do not like to be disagreeable to anyone; I do not like to say unpleasant things, but if ever there was a time when we should come down to cold, concrete facts it is right now, and not after the adjournment. Are we going to let those employees suffer until after Christmas, and during those days when we celebrate the birth of the Lord who said: Peace on earth, goodwill towards men? There is a French proverb, of which I do not know the English translation, which runs: "Ventre affame n'a pas d'oreilles." I will attempt to translate it for the benefit of my hon. friend who interrupted me a moment ago: "When one is hungry one listens to nothing." I am sure that my hon. friend could not have been fasting because he was listening to me.
I am a supporter of social order and of moderation more than the Prime Minister is and just as much as any other member of this house. If I use plain language it is because it is essential in view of the situation confronting us. The farmers have nothing, no money at all. How can they buy goods if, on account of the protection, those goods become dearer? What will happen to all those people who for a time were working for the Dominion Textile Company but who are now unemployed? What will happen to them? They are people of sane minds who are ready to abide by our laws. What do we expect from them, if they have not enough to eat, if they cannot procure food for their families or clothe them? What will the government do about it? The Prime Minister said on one occasion: "I will end unemployment," but he meant that he would aid it with the help of the provinces and
municipalities. When we vote even one cent for unemployment we have to know the reason why, and as you know, Mr. Chairman, we should be in a much happier position if we were not obliged to do so. But the circumstances compel us to vote relief moneys. We have to do something to relieve the unemployment; we have to see to it that those who are engaged in industry, those who carry on big business in Canada have the social spirit, and that they do not forget the word of the Lord: "Thou shall love thy neighbour as thyself.'" Their neighbours are the men who work for them, the labourers who have contributed to the fortunes and wealth of those controlling the business. Had it not been for the men and women working for the Dominion Textile Company those now at the head of that industry would not be as prosperous as they are today.
The hon. members from Winnipeg who have preceded me have indicated that there is plenty of watered stock in the textile industry. Where has it gone? That is one of the mysteries which future history will disclose.


Edward Joseph Garland: Possibly
part of it went down the Beauharnois canal.


Jean-François Pouliot: Then it is drowned.


Mr. QUINN:: Do not talk about Beauharnois.


Jean-François Pouliot: My hon. friends should not speak about Beauharnois when they know very well that members in their party received moneys from Beauharnois to carry on their election campaigns. In these times those who are prosperous should come to the aid of the needy; the richer they are the greater sacrifices they should make. If the Dominion Textile Company have enjoyed protection I suggest at this time the profits should be reasonably curtailed What the company has it has taken from the backs of the people; the other fellows have had to pay for it. In conclusion-


Some hon. MEMBERS:: Hear, hear.


Jean-François Pouliot: I thank hon. members
opposite for their very careful attention. It is time to see to it that industries are rationalized; it is time that everyone had his just dues. When the country owes nothing to certain people it should pay nothing. The people who must now be assisted are those who have suffered because the promises of one or several concerns have not been kept. We are accused by the Prime Minister of having been influenced by the passions of people who preach socialism. Well, if socialism is the love of one's neighbour, let me
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say that I am a socialist. Again, if socialism consists of devotion to the poor, the weak and the hungry, I am a socialist. I do not believe that is socialism in the sense usually condemned by some leaders of the state. We have had enough of words.


Some hon. MEMBERS:: Hear, hear.


Jean-François Pouliot: We must deal with plain
facts, but unfortunately when I state that we must deal with real facts I have to use words. What is humbug?


James Dew Chaplin: We are witnessing an
example of it right now.


Jean-François Pouliot: Humbug is an expression which had been covered by the dust of centuries, but was unearthed in London about two years ago. Since then it has travelled a lot. I should rather describe than define the term. Humbug consists of those statements, which, I believe I am in order to state, are not according to facts, and which are made in order to create false hopes. Mr. Chairman, have I spoken forty minutes?


Henry Herbert Stevens: Yes, forty minutes.


Felix Patrick Quinn: Tell us more about humbug.


Jean-François Pouliot: If you insist that I abide by the rules of committee, I shall be content, because I am not a socialist in the bad sense of the term.


The CHAIRMAN (Air. MacNicol):: I was going to suggest the hon. member ought to confine his remarks to the item under discussion.


Edgar Nelson Rhodes: I have listened with great interest to the remarks of the hon. member for Temiscouata. He is always entertaining and sometimes informative.


Felix Patrick Quinn: Sometimes.


Edgar Nelson Rhodes: I have gathered that he does not altogether like the Dominion Textile Company and I accept his statement that he is a socialist.


Jean-François Pouliot: In the good sense of the term.


Edgar Nelson Rhodes: Quite so. I am prepared to place my hon. friend on the top layer of socialism. I must say however that he has failed to enlighten me as to why he takes such grave objection to the item now before the committee. Inasmuch as he was most vehement in his utterances I take it he must have some objection. As a matter of fact

the item we are discussing does not increase duties; on the contrary it removes entirely the duties under the British preference upon a wide range of commodities which formerly bore duties of 17i per cent plus 3 cents per pound, 20 per cent plus 3 cents per pound and 22j per cent plus 3 cents per pound. I fail to understand why my hon. friend should object to our placing these items on the free list, especially after the reference he has made to the Dominion Textile Company. It would be extremely interesting to me, and I am sure enlightening to the committee and the country, if he would show how these reductions are going to help the Dominion Textile Company, increasing as they do the competition that if will have to meet from a highly specialized industry in the mother country.


Jean-François Pouliot: I wish to thank the minister for his explanation. I am glad to see that the government is on the way to conversion 1


Mr. HEENAN:: Did I understand that one of the ministers in his reply stated that the government or parliament had not the right to govern wage conditions through the tariff?


Henry Herbert Stevens: If the hon. gentleman was in his seat he -would know what has been said. I do not think it is incumbent upon us to repeat it.


Peter Heenan: That is true; unfortunately I was not in my seat at the time. But I hiave been informed that one of the ministers stated that parliament had not jurisdiction to adjust wages under tariff items.


Henry Herbert Stevens: No such statement was
made.


Peter Heenan: Well, words to that effect.


Henry Herbert Stevens: No, nor words to that
effect.


Peter Heenan: Then in case there is any mistake I want to remind the ministers that they have the right. I quote no less an authority than the present Alinister of Trade and Commerce.
1 was referring to the three sitting in the front row.
Referring to the then ministers.
Not a minister has offered an explanation, not a minister has offered any sympathy or shown any interest in this matter. I am not sufficiently an expert to say that items 377a, 377b and 377e cover the ambit of this particular industry, but I imagine that they would. In connection with these items we have an opportunity of saying to this industry: "Yes, the parliament of Canada is prepared to give

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you protection sufficient to enable you profitably to produce these articles"-the minister could do that just as easily as sitting there lolling in his seat-but before such tariff will apply you will satisfy the governor in council that the conditions of labour, the hours of labour and the wages paid are such as will afford a decent living! That is what the government could do; that is what parliament could do, and I say right now that that is v hat parliament should do before it goes a step further.
So that there may be no mistake I remind the minister that that is what he said.


James Shaver Woodsworth: The minister a
little while ago suggested that the very high profits of the textile companies had been made in connection with the war, and were exceptional.


Henry Herbert Stevens: May I interrupt? I do
not wish the discussion to go off at an angle. I said that the particular figures quoted by the hon. member were figures with which I happened to be familiar, because I was chairman of the committee that investigated. I referred to that particular instance; I did not refer to the matter generally at all.


James Shaver Woodsworth: I am very glad of
that, because certainly the impression given was that these very high figures were exceptional and not general. In fact the minister apparently had for the moment forgotten even the name of this company.


Henry Herbert Stevens: I remember it now; I had forgotten it. It was Paton's.


James Shaver Woodsworth: It was such a trivial thing that the minister had even forgotten the name of the company.


Henry Herbert Stevens: It was thirteen years ago.


James Shaver Woodsworth: What we are trying to impress upon the committee is that these high profits that have been referred to are not so exceptional, but have been common; and that together with the high profits there have been very low wages. I referred a little while ago to certain statements put upon Hansard on June 15, 1931, by the member for Beauharnois. May I quote one or two very briefly. From 1924 up to this date the company referred to, the Dominion Textile Company, has paid without interruption dividends which are equivalent to 150 per cent on the initial investment of 8500,000, and 15 per cent on the second subscription of $2,500,000 made in 1922. Then turning to another company, I read one statement in regard to Montreal
Cottons. That company for the financial year ending December 31, 1929, the last for which I have figures, shows that its common stock, for which not a cent was paid, has a value in the books of the company of $3,000,000, and that after having paid dividends at the rate of 6 per cent on this watered stock it still has a surplus in accumulated profits not distributed of $633,000.
I happen to have in my desk the Financial Post of June 18, 1931, in which are given ten years' earnings of the Dominion Textile Company, which I desire to place on Hansard:
Year	Earnings	Dividends	Surplus1920. . . .	$1,845,375	$ 535,842	$4,053,0441921. . . .	1,931,010	635,842	4,636,5911922. . . .	1,907,237	735,842	5,007,7001924. . . .	1,767,529	1,035,842	5,390,0031925. . . .	1,948,668	1,035,842	5,665,0171926. . . .	1,905,309	1,260,842	5,999,1641927. . . .	2,101,896	1,260,842	6.529,9871928. . . .	1,903,832	1.260,842	6,862,6571929. . . .	1,976.668	1,316,692	7,211,4151930. . . .	2,079,931	1,485,646	7,498,035
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.
Mr. AA OODSAA'ORTH: When the committee took recess, Mr. Chairman, I was giving the earnings of the Dominion Textile Company over a .period of years. Possibly it might be just as well to bring that statement up to date. According to the Financial Review of 1932 I find these figures to be:
1931	1932
Manufacturing profit..	..	$1,085,251	$1,071,245Dividends: Preferred.	..	135,842	135,842Dividends: Common..	..	1,350,000	1,350,000Total surplus	
7,515,552	7,363,266
It will be seen that there was only a slight drop in the total surplus in 1932. I do not intend to detain the committee by giving the figures with regard to the other textile companies, but they tell a very similar story.
WIth regard to wages, the last figures we have are those contained in the Canada Year Book for 1932. If there has been any change since the publication of this volume it has been in the direction of a lowering of wages, owing of course to the cut in wages and to the fact that most of the employees are working on part time. At page 359 of the year book are given the average earnings in a number of leading industries. In connection with cottons, the male employees numbered 11.369 while the females numbered 8,157, a total of 19,526. In 1929 the average wage was only $771, while the average days of full and part time operation
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numbered 258. I think the contrast between the profits secured by this company and the wages paid in the textile industry amply demonstrate the ipoimt we are trying to make, namely that the protection of the industry does not involve the protection of the workers employed by it.
Without prolonging the discussion, there are two or three questions I should like to ask. Why should not surplus, accumulated during years of prosperity, be drawn upon in a time of depression? Why should this particular group of industries be given such special privileges that. they can maintain their surplus almost untouched? I ask why there should be a dole given those not in poverty? In the care of individuals who are in the bread line the utmost care is taken to see that they are not given relief unless they actually are in necessitous circumstances, but in this case the textile industries that have been fat and flourishing throughout these past years, and that are still in a very fair condition, paying dividends and retaining their surpluses, are given this tremendous dole amounting to millions of dollars. We have never had explained in this house the reason why arrangements of this kind should be made. Why, I ask, should we give preferential treatment to the textile industries? There are many other lines of business that are practically bankrupt, some of them absolutely so. We have been trying to point out from this corner of the house that the great wheat industry is in a very bad way in the west; in fact the agricultural industry all over Canada is in a bad way, with many farms mortgaged and some of them threatened with foreclosure. Apparently there is no effort on the part of the government to make any provision that will secure the savings of the farmers, yet when we come to the textile industries we are told that they must be kept in operation no matter what the cost.
I know it is useless to argue the point; all we can do is protest against this preferential treatment that is accorded one particular class of industry in Canada.


George Gibson Coote: There are one or two questions I should like to ask the minister in regard to this item. This afternoon the Minister of Trade and Commerce said the textile manufacturers in Great Britain would have the power to appeal to the tariff board to reduce these tariff rates if they were found excessive. I should like to ask the minister if the tariff board are to have the power to fix tariff rates, or whether that will be done by the government on a report from the tariff board.


Henry Herbert Stevens: I think my hon. friend
knows the tariff act; I can get it and read it to him if necessary. He will recall, I think, that the matter of fixing the tariff is to remain the prerogative of parliament. There is no question of that. If my hon. friend will turn to what I read this afternoon-


George Gibson Coote: No; I am quite willing to take the word of the minister for that. I just wanted to be sure. Then there is another question I should like to put to the minister. If the difference in the wage costs of the two countries really is the basis for the tariff in Canada, why should we have a specific tariff of so much a pound on these different classes of goods? I am sure that does not work out at all in relation to wage costs. Some of the heavier fabrics bear twice the protection, under a specific tariff, that is given some of the lighter goods, so I cannot see that it has any relation to wage costs at all. I should like to know whether that was given any consideration when this tariff was fixed.


Henry Herbert Stevens: My hon. friend will recall that this afternoon I pointed out that the abnormal conditions with which industry generally was confronted when we came into office made necessary emergency treatment, and the treatment we gave this section of the tariff was the result of this emergent condition. I also pointed out to my hon. friend that we did not look upon this as a permanent condition of the tariff; we felt that it was necessary to take extraordinary methods to prevent the closing down of these important industries, and we achieved that end. As I pointed out this afternoon, we were confronted with two alternatives; one was to let the industry in Canada go, and the other was to take some steps that would adequately protect it against the dumping of goods from abroad, bankrupt stocks, distress sales and so on. That is the long and the short of it.


George Gibson Coote: Then it seems to me, Mr. Chairman, that we should suggest to the government that two years have elapsed since this emergent measure was taken, and that it is about time the tariff was put on a more equitable basis than exists at the present time. I understand that we are now guaranteeing the differential in regard to these specific tariffs. I do not see how we are going to get rid of them unless it is by agreement with the old land. I think that is a great oversight on the part of the government. It never should have been allowed at all.


An hon. MEMBER:: It is not an oversight.

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George Gibson Coote: Then it is a very bad piece of business so far as the people of this country are concerned.


Henry Herbert Stevens: These items now under consideration we are putting on the free list from Britain. That is absolute treatment, so far as that item goes.


Abraham Albert Heaps: What item has the minister in mind?


Edgar Nelson Rhodes: 523a and 523b.


George Gibson Coote: The remarks I have made apply to a great many of the items we have been considering. Shortly before coming to Ottawa I was told by the retail merchants that the price of overalls had been advanced by the wholesalers, the manufacturers of overalls claiming that the cost of their material which they must obtain from the textile companies of Canada having been advanced by those companies. The farmer never had so little to buy overalls with as he has had this fall, and I certainly think it is the duty of the government to see that the textile people of Canada are compelled, if necessary by the lowering of the tariff, to sell their goods cheaper than they are doing at the present time. Overalls are about the cheapest clothing the farmer can buy and in some instances the only clothing, and it is nothing but a shame to have these goods advanced in price at such a time as this.


An hon. MEMBER:: What is the price of overalls today?


George Gibson Coote: It would take what we call a butcher hog to buy a pair of overalls in Alberta, and it takes six months to produce that hog, which requires a good deal of feed during that period. There is one other question I want to ask. Considering the amount of tariff protection that is to be allowed the Canadian textile manufacturers, based on the difference in the cost of production in the two countries, is it the intention of the government that allowance should be made in the returns of capital stock of the textile companies now operating in Canada, or will action be taken to squeeze out some of the water in these stocks, similar to the action which the minister told us was taken in England in regard to one of the large cotton concerns there. There is absolutely no doubt, with regard to some of our cotton companies, that a great deal of this stock was nothing but water, and considering the price I do not think that provision should be made for the payment of dividends on that watered stock.


Henry Herbert Stevens: The way my hon. friend puts the question makes it impossible to give an answer directly. Let me say to him very frankly-and I make this statement not only now, for I have said the same thing publicly and to manufacturers' gatherings-that I have absolutely no sympathy with the practice that has grown up on this continent, not only in Canada but elsewhere, and in the world at large as well, of unduly watering stock, using the term in a general sense. Speaking for myself, and from an actuarial standpoint or from the point of view of ordinary economics, I do not think that should seriously enter into consideration with respect to the justifiable returns of any company.


James Shaver Woodsworth: Do I understand
that that principle will be applied by the government?


Henry Herbert Stevens: My hon. friend is putting to me questions of a character that could not possibly be answered in the terms which the questions indicate he desires. I am stating my own opinions and I have no hesitancy in doing so. I was going to direct his attention to section 4 of the Tariff Board Act:
In respect of goods produced in or imported into Canada the Board shall, at the request of the minister, make inquiry as to-
(a)	the price and cost of raw materials in Canada and elsewhere, and the cost of transportation thereof from the place of production to the place of use or consumption;
(b)	the cost of efficient production in Canada and elsewhere, and what increases or decreases in rates of duty are required to equalize differences in the cost of efficient production;
(c)	the cost, efficiency and conditions of labour, including health of employees, in Canada and elsewhere;
(d)	the prices received by producers, manufacturers, wholesale dealers, retailers and other distributors in Canada and elsewhere;
(e)	all conditions and factors which affect or enter into the cost of production and the price to the consumers in Canada;
(f)	generally, all the conditions affecting production, manufacture, cost and price in Canada as compared with other countries;
And so on.
In other rvords, the board will consider the well-recognized principles and factors that enter into the cost of production. So far as I am concerned, and I again make it clear that I am stating my own views, just as my hon. friends have done, I do not think that approval should be given to what is known as the watering of stock. I think that is a practice which is bound to bring disaster and should be frowned upon.
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Abraham Albert Heaps: Has the minister had any
protests in the past two years against the actions of the textile companies in this country ?


Henry Herbert Stevens: Protests?


Abraham Albert Heaps: Yes.


Henry Herbert Stevens: No.


Abraham Albert Heaps: Have the secondary manufacturers, who are compelled to use the products of the textile companies, at any time protested to the government against the action of the textile companies, the arbitrary manner in which they deal with those secondary concerns?


Henry Herbert Stevens: So far as my department is concerned, I am not aware of any protests.


Abraham Albert Heaps: I ask that question because I have had protests made to me by certain manufacturers against the actions of the textile companies here and the way in which they were dealing with the secondary manufacturers. I know customers of the textile companies who have suffered in this regard. The moment the changes came about in these schedules, or rather when they *were about to be introduced, the textile companies refused to supply Canadian manufacturers with their goods on invoice. They refused to quote prices until they knew what the tariff would be, and they knew it would go up. The result was that these manufacturers found themselves in difficulties; they did not know what to do. They had no way of supplying their own customers with textile products and in some instances they practically had to allow their factories to remain idle, because of the arbitrary action of those who received this tremendously high protection from the government. In other cases, I am safe in saying, manufacturers have been compelled to go out of business because it was impossible for these concerns to be supplied with the goods they wanted. The question of denim has been raised by my hon. friend from Macleod. In connection with this item, if the facts were gone into carefully by the minister he would find that the price has fluctuated almost in exactly the same degree as the tariff in this country. The result is that the second manufacturer has been placed in a most awkward position and his business has been reduced to very small proportions.


Edgar Nelson Rhodes: I do not quite understand why this discussion has taken the turn it has .Mr. Stevens. J
with regard to this particular group of items. Let us deal with the commodity to which my hon. friend refers, denim. We have removed substantially the duties which have obained for years in connection with the British preferential tariff and have placed all these commodities on the free list, so that the condition of which my hon. friend complains cannot reasonably be expected to continue. Admitting, for the sake of argument, that the hon. member's statement is correct, the secondary manufacturer has not now to depend wholly upon the Canadian market; he has open to him, the whole range of British goods. The condition of which the hon. member complains is, I think, likely to be entirely eradicated by reason of the provisions of this tariff.


Abraham Albert Heaps: I may add that any remarks I make on any particular item will not be repeated on others, so I will not waste time in that respect. Could the minister tell me how much denim was imported from the old country?


Edgar Nelson Rhodes: That information is not immediately at hand. If it can be obtained before the committee rises, I shall give it to my hon. friend. Denim is now upon the free list from Great Britain.


James J. Donnelly: As I understand it, these items 523, 523a, and 523b have been taken out of the regular schedule. I do not suppose the minister is able to give us any figures showing how much of these goods have come into the country during the past year nor is he able to tell us the Canadian production. If one considers these items for a moment he will realize that there is a nigger in the woodpile. The finer varieties of cotton goods which are not made in Canada have been put upon the free list so that the rich man can obtain these goods from England without paying a duty. The poorer and coarser varieties of cotton goods out of which overalls, workmen's shirts and things of that kind are made, must pay a duty. The government is running true to form in helping to make the rich man richer and the poor man poorer.


Edward James Young: The discussion on these three items has covered practically the entire cotton textile industry. This afternoon the minister stated that the total production in Canada was valued at $58,000,000. Great Britain went off the gold standard in September, 1931, and I was wondering if the minister could give us the total importation of cotton goods from that date.

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Henry Herbert Stevens: That would be very difficult, because September is precisely in the middle of the fiscal year and all statistics are compiled for the fiscal year. The only way we could get that information would be to put a staff on to segregate these items month by month and invoice by invoice. It could not be obtained except with considerable difficulty.


Edward James Young: I understand the minister's difficulty, but I should like to have this information in order to discover the effect upon our importations of the exchange adjustment duty, as the minister likes to call it, which was imposed after Great Britain went off the gold standard. It i3 very difficult to arrive at the exact rates, but as nearly as we can figure them, the total duty will average something over fifty per cent. The total production of Canada is valued at $58,000,000, and fifty per cent of this amount would represent the increase in price made by the domestic manufacturers. This will give some idea of what this industry is costing Canada. We are told that it pays $14,500,000 in wages. That is so much to the good; that is something to be put to the credit of the industry, but, on the other hand, we want to know what this industry is costing us. If they are charging fifty per cent more than the goods are worth, then I would say that this industry which pays $14,500,000 in wages is costing us between $25,000,000 and $30,000,000 in increased prices.
It is about time that we began to take stock of our industries in order to find out which ones are profitable and which ones are not. Any industry which is not selfsupporting and which cannot compete with the world, any industry which has to come to the government and ask permission to charge an extra price for its goods, is not worth while, even in these hard times. It is a parasite living upon the rest of the community. It is said that we must take care of these industries, that we must take care of the widows and orphans who have invested their money therein, but I am more concerned with the widows and orphans who have no money to invest in any industry, who have no clothing to wear and who cannot buy even the cheapest cotton goods. Last June the Minister of National Revenue told us how he would not let an importer bring in ten thousand dozen cheap ladies' dresses to be sold in Canada at three for a dollar, but today there are many of our people who cannot afford to pay even this low price.
I should like to deal for a moment with the quality of goods now being put upon the market. When you shut out foreign and 53719-85
British competition, and it has been shut out, and deliver the market into the hands of a Canadian monopoly, that monopoly is more than likely to deteriorate the quality of their goods as well as to increase the price. Canadian women have been accustomed to buying cheap house dresses which they wear for a day or two and then wash. I am told that the dress on the market today is so poorly dyed that the colours run as soon as they are put into water. I have been told by women that they actually have to soak such dresses in brine before they can wash them, and even then they have to be careful or the colours will run. I have been told also by women who have lived in the old country that they would never think of doing such a thing over there, they could wash the print dresses they bought and the colours would not run. Once the British goods are shut out-


Henry Herbert Stevens: British goods are not shut out; last year $1,500,000 worth of denim came in from Great Britain.


Edward James Young: The duty on British goods
has been made so high that it is difficult for them to come in. However, the very fact that they are still coming in in spite of the high duty is proof positive that our Canadian manufacturers are taking full advantage of the duty. If they were not taking full advantage of the duty to advance their prices, they would undersell the British product on the market and would be able to hold the market for themselves. One of the most prominent and perhaps one of the ablest protectionists in Canada has stated that when you put a protective duty upon an article, if the article does not stop coming into the country the duty should be taken off. That man is a manufacturer himself and he states that the manufacturers are taking full advantage of the situation. When the minister states that British goods are still coming in I accept that as proof that our manufacturers are taking advantage of this situation to raise prices.
Something has been said about the large profits of the companies engaged in this business. Personally I do not begrudge anyone any profit. I do not begrudge anyone anything he can make by his own effort, by his own energy, by his own enterprise and by his own application to business. But when anyone comes to the government and says: In order that we may make a profit we want you to pass legislation which will deliver the people of this country into our hands so that we can make them buy our products

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at our price without considering conditions prevailing throughout the world, then I say that the business of that company becomes a matter of concern to us. We in this house have a right to know what that company is doing, what it is paying out in wages, what this industry is costing this country, whether it is an industry worth maintaining or not.
For the past several days I have been endeavouring to get from the minister the actual applied rate on goods coming in from Great Britain, all factors considered. He hesitated a considerable time about giving it because he said it would be hard to estimate accurately, and he did not want to risk the reputation of the experts of the department by having them quote figures that might not be accurate. But yesterday the Minister of National Revenue came into the house with an estimate of the actual applied rate which was a little higher than I had figured. I had figured that on the particular item under discussion the total duty would be about 47 per cent, but the minister in his calculation made it over 50 per cent. I think he was a little over generous, that he made out a worse case for the government than was really necessary. What he did was to add all of the six per cent sales tax to the duty. That is not quite fair, because the six per cent sales tax applies to the domestic product as well. All I wanted to get was the handicap under which the imported article comes into the country, and consequently only that portion of the sales tax which is levied on the artificial value of the pound should be charged. The six per cent sales tax would be levied on the Canadian product, but on the imported article it would be levied on the 14.86 which is the value of the pound for duty purposes, while the real value is only $3.73. I say it would not be fair to charge all that against the duty. It is only fair to charge the six per cent on the difference between $3.73 and $4.86, or approximately 14 per cent.
In view of the fact that the minister himself with his experts has failed, after two or three days work on it, to make an accurate estimate I might be pardoned for offering to the house a little assistance in arriving at what the actual applied rates will be. I have prepared a table-we might call it "A Key to the Canadian tariff"-which in one column gives the quoted rate under the British preference and in the next column what the actual applied rate will be. Here is the table:

Quoted rate under
the British preference	Actual applied rate
Per cent	Per cent
Free	23
5	28-3
74	31-8
10	35
12J	38-1
15	40-9
174	44-1
20	47-2
224	50
25	53-2
274	56-2
30	59
I think that will help us considerably in finding out what the rate will be on items in the schedules so far as we have gone through them. But when we enter upon the textile schedules there is another factor to be taken into account, because, in addition to the ad valorem and all the other duties, there is a specific duty of so much a yard or so much a pound or so much a dozen. That is a further complication. When I see how this tariff is built up of all these varying factors I am reminded of a story of a number of college students who wished to play a joke on their professor. They took the body of one insect, the legs of another, the head of a third, and the wings of a fourth, glued them all together and submitted the result to the professor for identification. He looked at the insect, adjusted his glasses, frowned, and then, "Ah", he said, "I see it is a humbug". I think, Mr. Chairman, this tariff, made up as it is of ad valorem duties, specific duties, exchange dumping duties, the excise tax, the sales tax and as many other things as the commissioner of customs and his assistants can think of, might well be described as a humbug.
The minister said a moment ago that they had actually reduced the duty on the item we are discussing. Reduced the duty from what? From what it was when they were through with it last year. Take item 523b. Here are the rates as they have been and as they are to-day. In 1895 the preferential rate on this item was 234 per cent; in 1907, 25 per cent; 1923, 18 per cent; September, 1930, after the short session, 224 per cent, and an additional three cents a yard, which made it approximately 27 per cent. In the fall of 1931, after Great Britain had gone off the gold standard, the rate suddenly jumped to 61 per cent. And now, after the imperial conference, in order to encourage interimperial trade, we have lowered the duty from 61 to 58.5 per cent, and the minister tells us that he has lowered the duties from where

United Kingdom
we left them! We left them at 18 per cent. The government opposite have twice since then increased them, last year to 61 per cent Now they have reduced that rate to 58 per cent, and the minister says it is done to encourage British trade!
As I said a moment ago, it is going to be very difficult to figure out what the actual rates will be on these textile items because there are the specific duties to be added to all the other duties, and the specific duty being so much per pound, per yard or per dozen, it is necessary to know either the weight of the article or how many ounces there are in the yard and the value in order to reduce the duties to a comparable basis. We did secure the services of an expert to figure out what the rate would be on this one item, 523b. He took a shipment of ten yards at 6i pence per yard, with the pound sterling at $3.66. The ad valorem rate would be 28 cents on that shipment; the weight duty would be 4.5 cents; the excise tax on the duty paid value, 5 cents; the dumping duty 21 cents; making a total of 58.5 cents on a one dollar shipment, or a duty of 58.5 per cent. Even in this calculation I think one factor has been overlooked, and that is that a larger portion of the six per cent sales tax has been charged than is actually justifiable, so we should have to add 1| per cent to that, making the total duty 60 per cent. So that 60 per cent is the duty we are paying on this commodity. As I said before, the very fact that in spite of the tariff these goods are still coming in from Great Britain, is proof positive that our Canadian manufacturers are taking advantage of the situation to increase their price almost, if not completely, up to the level of the sixty per cent plus the regular price. Once more I ask: What is this industry giving in exchange for that? Sixty per cent added to the $58,000,000 worth of goods produced in Canada, and $14,000,000 paid in wages? Mr. Chairman, this industry is a luxury we cannot afford; we cannot afford to continue it.
I should like to draw attention to a statement made by the Prime Minister a few days ago. Speaking of the conference he said his aim was to shut out foreigners. His statement was, "That is the one thing we have done." The Prime Minister has told us that the only thing he has done since he came into power is to shut out the foreigner, but I say he has done more than that: he has shut out the Britisher as well. Since the imposition of this special dumping duty our importations from Great Britain have enormously declined. The following table 53719-851
will give a comparison of imports from the United Kingdom during the fiscal years 1931 and 1932:
1931	1932
Fabrics, bleached	$ 654,943 $563,139
Fabrics, unbleached... 416,392	264,711
Fabrics, printed	
1,215,888	979,121Socks and stockings (cotton)	27,269	9,099Carpets and rugs	
561,403	144,918Overcoating	
538,064	196,782Tweeds	
1,071,060	505,817Socks and stockings	(wool)	1,272,817	597,354
Hon. members will note the effect of the increased dumping duty levied upon British goods. It has cut British trade to less than half its former quantity. The Prime Minister states the only thing he has done is to shut out the foreigner, but I submit I have proved his statement is not so because he has shut out Great Britain also. The Briton is our best customer for wheat, for dairy products, for hog products, for cattle products, for nickel, zinc, copper and lead. Despite that fact the Prime Minister has shut him out of our market, and then wonders why we cannot sell our wheat.
What is he doing for the Canadian textile industry? He is permitting them to charge us an extra sixty per cent for our cotton goods and permitting the woollen interests to charge an extra price for their goods. He is permitting every other manufacturing industry to add to the price we have to pay for goods they have to sell. He says he does that in order to keep people in employment and in order that manufacturers may make profits, because we must remember that out of every $8 profit they make they must give him 81 for the treasury. In my view that is a strange way of doing things, but that is what he is doing for industries.
When we ask him what he is going to do for the farmers, the people who are to buy the products of other , industries with which he is so much concerned, what does he say? "I am afraid," he says, "I cannot do anything, because the money I might have used to help the farmers has been lost in the wheat market." It is a pretty serious situation, Mr. Chairman, when the basic industry of Canada, an industry suffering more than any other, day after day, is having new burdens placed upon its back in order to sustain these secondary interests which, after all, are not employing as many men now as they were when this government took office. When the present government started in to bring prosperity to Canada there were many more employed in our factories than there are to-day.


Mr. PRICE:: In what industries?
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Edward James Young: In all industries.


Otto Baird Price: To what industries is the hon. member referring? He has stated that in industries throughout Canada many less men are being employed. I ask him to tell me of what companies he is speaking. A moment ago he made reference to the woollen industry. I say to him that under the administration he supported industry had gone practically out of business. In the constituency I have the honour to represent it had fallen down to such an extent there was an absolute minimum of emplo3rment, and the manufacturers themselves were operating at a loss. Yet he stands up in this committee and not only once but, from actual count, four hundred and forty-nine times he states conditions are worse than they were previously.


Edward James Young: Four hundred and fortynine and a half.


Otto Baird Price: The hon. member always has some complaint. Hon. members on this side are beginning to wonder if out in Weyburn they have a zoological garden from which something has escaped. Let me tell him that the woollen industry in Canada is going ahead today, paying wages and employing more men than it did previously. It is producing goods for which there is a ready market. The hon. mentber has always been in favour of foreign countries, and particularly the country to the south of us. He could see no harm in dumping goods into Canada from foreign countries. Under the late administration he could see no harm in bringing prison made goods from the United States, but today when the government is giving assistance to Canadian industries, putting them on their feet and employing thousands of Canadian citizens, he objects. He says, "Oh, there is too much charged here and too much there." He is absolutely and unalterably opposed to the employment in Canada of Canadian citizens.


Edward James Young: The hon. member for Westmorland is curious to know if we have a zoological garden in Weyburn. No, we have not; but I can tell him that if he will come out to Weyburn we have an institution which will take care of him.


James Dew Chaplin: Why did it not take care of you?


Edward James Young: The hon. member for Westmorland has referred to the wool industry, which he says is thriving.


Armand Renaud La Vergne: Hon. members must
confine their remarks to the item.


Edward James Young: Very well, we shall deal
with woollens when we come to them.


Otto Baird Price: This is a wonderful hold up.


Edward James Young: As I said a moment ago, we had to learn the actual invoice price of goods coming from abroad so as to figure out the actual applied rate on a shipment of goods coming in under item 523b. When we had that information it figured out to sixty per cent. I want to know if the minister cannot find some way of giving us what the actual applied rate will be on all these items that carry an ad valorem and specific duty in addition to all the others.


Henry Herbert Stevens: Did my hon. friend ask a question? We have heard his story so often that I confess to him with apologies that I was not following him this time. AVas it something in connection with the exchange adjustment duty?


Edward James Young: I asked my hon. friend if he could not devise some way, as we go through these textile items on which there are both specific and ad valorem duties, of figuring what the actual rate will be.


Henry Herbert Stevens: I explained this afternoon, at more length than I thought it justifiable to take time for, the conditions under which these duties were imposed, the reasons for them, the fact that we have reduced them under the British preference,-all have been reduced, some substantially and some just one cent a pound-and that the British manufacturers would have access to the tariff board where the matter of the weight of these duties might be fully considered. If we sat and talked here from now until next spring it would not alter the situation. I can assure my hon. friend that the government is quite sincere in its proposals. I do not know what I can say more.


Edward James Young: The minister was busy when I was talking and did not follow what I said.
I said we had gone to an importer and secured an invoice of a shipment under 523b. From that and the figures here given we were able to figure out what the actual applied rate was on that shipment. The duty had been increased by my hon. friends opposite during the past two years to as high as 61 per cent.


Henry Herbert Stevens: I heard all that.


Edward James Young: Now it has .been reduced to 60 per cent. .


Henry Herbert Stevens: That is my hon. friend's deduction. I heard that.

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Edward James Young: Yes, that is the deduction I make, and if I am wrong I wish the minister would set me right. If anyone on the other side of the house is capable of making a deduction .more favourable to the government I shall be glad to hear it.


Henry Herbert Stevens: I have already pointed out time after time that my hon. friend includes in his rate of duty the exchange adjustment duty, which is an entirely different thing from the customs duty. He differs from us in that, and there is no use in our discussing it further. I have gone over that again and again.


Edward James Young: My hon. friend seems to have the idea that we should not include the exchange adjustment duty, but I have pointed out in the figures I quoted on importations from Great Britain that the addition of that exchange adjustment duty a year ago this fall had the effect in the first six months of cutting our importations from Great Britain in half. I think, therefore, we are justified in taking into consideration that exchange adjustment duty. It is having the effect of shutting these goods out of this country, of putting our own manufacturers in a position to raise their prices by that amount. He can call it anything he likes, but it is a duty, and it is collectable. He says: "We have made reductions." We want to know what reductions. In this case they say there has been a reduction of one per cent. When they came into office it was 18 to 20 per cent; they raised it to 61 per cent; now they reduce it to 60 per cent. If there is anything wrong in my figures there are a hundred men on the other side of the house who ought to be able to figure it out, and if not they have the experts of the department at their elbow to do it. All we ask, and all we have been asking all this week, is that they tell us what the actual rate is. They ask us to put certain rates into effect, and when we ask what the rates are, they cannot tell us.	-


Edgar Nelson Rhodes: I do not know whether it is worth while, Mr. Chairman, but I direct your attention to the fact that the item my hon. friend is discussing just now was passed early this afternoon.


William Richard Motherwell: If the ministers have no better defence to make to their outrageous tariff we will have to accept the figures of the hon. member for Weybum as correct. I am prepared to take them as correct, because there has been no defence made.


James J. Donnelly: When the special schedule was prepared there must have been some
information in the hands of the department as to how much of these goods were made in Canada. Can the minister tell me how much of the goods coming under 523, 523a and 523b are made in Canada?


Henry Herbert Stevens: We gave that all this afternoon.


[Stage Direction]
Item agreed to.
Customs tariff-523e. Woven fabrics wholly of cotton with cut pile, n.o.p.: British preferential tariff, 15 per cent; intermediate tariff, 271 per cent and 3J cents per pound; general tariff, 32J per cent and 4 cents per pound.
Item agreed to.
Customs tariff-523f.	Woven fabrics of
cotton, not coloured, when imported by manufacturers of typewriter ribbon for use exclusively in the manufacture of such ribbon in their own factories: British preferential tariff, free: intermediate tariff, 12J per cent; general, tariff, 15 per cent.
Item agreed to.
Customs tariff-524. Seamless cotton duck in circular form, of a class or kind not made in Canada, for use in the manufacture of hose pipe: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 10 per cent.
Edward James Young: What are the importations?


Edgar Nelson Rhodes: Last year the imports were $108,000, of which $105,000 came from the United States.


Edward James Young: And the other $3,000?


Edgar Nelson Rhodes: It is not indicated.


Edward James Young: Not much chance of Great Britain getting into that market.


[Stage Direction]
Item agreed to.
Customs tariff-528. White cotton bobinet, plain, in the web: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 25 per cent.
Edward James Young: What is that?


Edgar Nelson Rhodes: It is a knitted fabric, and the importation is comparatively limited. Last year the total imports amounted to only $6,000.


Edward James Young: I would like to ask the hon. member for Long Lake (Mr. Cowan) if that is the kind of cotton they use in their organization.


Mr. COWAN (Long Lake):: Anyhow we have an organization that is not all mouth


[Stage Direction]
Item agreed to.
[Stage Direction]
Imperial Conference-Trade Agreements
Customs tariff-529. Embroideries, lace, nets, nettings, bobinet, n.o.p., fringes and tassels, wholly of cotton:	British preferential tariff,
20 per cent and 2 cents per pound; intermediate tariff, 274 per cent and 34 cents per pound; general tariff, 30 per cent and 4 cents per pound.
Alfred Speakman: Has the minister any idea of the average or approximate value per pound of these goods? I might point out that in this item, as in many others, there are two kinds of duties, the ad valorem and the specific. If we are to make even an estimate as to the real percentage of duty it will be necessary to have some idea of the value per pound.


Edgar Nelson Rhodes: I am advised that an average figure would be practically valueless, since this covers a hundred different varieties of commodities.


Alfred Speakman: That is what I rather suspected, and I wondered on what basis those specific duties were made up. There is an unfortunate anomaly here. Referring to items 523b and item 529, we see that each has the same specific duty of 2 cents, 34 cents and 4 cents in the one case, and 2 cents, 34 cents and 4 cents in the other. The first item covers woven fabrics of cotton, while the second item covers embroideries, lace, nets and so on. The first item covers ordinary cotton goods of various kinds, which I imagine would be a good deal heavier than the laces and embroideries which are included in the second item. I was merely going to point out the unfortunate anomaly which exists here; under a specific duty, which bears no relation to the value at all, that duty must always rest more heavily on the cheaper, commoner and coarser goods than on the lighter, finer materials. Up to a certain point it is always heavier on ordinary cloth, while the fact is that the heavier, coarser yarns are the less valuable. This establishes the thoroughly wrong principle that the cheaper and coarser goods carry a heavier rate of duty than the lighter and more valuable fabrics.


Albert Frederick Totzke: I presume this is one of the
items in connection with which the British preference has been reduced?


Edgar Nelson Rhodes: Yes.
Mr. TOTZKE; Will the minister tell us what the tariff was before 1930?


Edgar Nelson Rhodes: It was 20 per cent, 274 per cent and 30 per cent.


Albert Frederick Totzke: There was no specific duty?


Edgar Nelson Rhodes: No.


Albert Frederick Totzke: So there is no real reduction?


Edgar Nelson Rhodes: It is only a reduction from the specific rate existing at the moment. Of course my hon. friend realizes that this rate was put on for a specific purpose, to meet an emergent condition. It was never intended to remain permanently.


Albert Frederick Totzke: It is not intended that the high tariff shall remain there?


Edgar Nelson Rhodes: No.


Albert Frederick Totzke: But under this agreement it will remain for five years.


Edgar Nelson Rhodes: No, we can reduce it.


Albert Frederick Totzke: With the consent of Great Britain?


Edgar Nelson Rhodes: Yes; we can reduce, but we cannot increase.


Albert Frederick Totzke: You can reduce any item
under this agreement?


Edgar Nelson Rhodes: Yes, where we reduce the preference rate. They would be very glad to have us do so.


[Stage Direction]
Item agreed to.
Customs	tariff-532.	Clothing, wearing
apparel and articles, made from woven fabrics and all textile manufactures, wholly or partially manufactured composed wholly of cotton, n.o.p.; fabrics wholly of cotton, coated or impregnated, n.o.p.: British preferential tariff, 25 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent; and British preferential tariff, 2 cents per pound; intermediate tariff, 34 cents per pound: general tariff, 4 cents per pound.
Item agreed to.
Customs tariff-537b. Linen thread for hand or machine sewing: British preferential tariff, free; intermediate tariff, 224 per cent; general tariff, 25 per cent.
Thomas Reid: Would the minister give me the figures on this item, and tell me where the thread comes from?


Edgar Nelson Rhodes: The total imports last year amounted to $232,000, of which $224,000 came from the United Kingdom.


Thomas Reid: How much was manufactured in Canada?


Henry Elvins Spencer: Was there any tariff against Great Britain?


Edgar Nelson Rhodes: The old rates were 15 per cent, 224 per cent and 25 per cent. It is now made free, 224 per cent and 25 per cent.


Thomas Reid: Could the minister tell me how much is manufactured in Canada?


Edgar Nelson Rhodes: 
Edward James Young: Some days ago, when the Minister of Trade and Commerce, I think, was speaking on the agreement in general, he said that we had delivered over the whole Canadian linen industry to the British manufacturer. I wonder if he could give us the statistics of the industry, what they produce, what establishments we have, the number of employees and so on.


Henry Herbert Stevens: We shall be very glad to give the information as we proceed with the following items.


Thomas Reid: I think this is one of those items which will be of more benefit to the importer of the linen thread than it will be to the industry, because it is well known that the Coats firm of Paisley, of which I know a little, practically controls the thread world. So the market is practically given over to the Coats people. The rate has been made free to Great Britain, but it is kept the same in the intermediate and general tariffs, which means that the Coats firm will have the entire consuming public of Canada to deal with. Heaven knows those people are rich enough without giving them any further advantages.


Henry Herbert Stevens: I must correct what I said a moment ago to the hon. member for Wey-burn. There is virtually only one producer in Canada, and according to the practice of the bureau of statistics the production of anything less than three firms is not given out, so I am afraid I shall not be in a position to give the information requested.


Edward James Young: Can the minister tell us the lines that are produced here?


Henry Herbert Stevens: Yes; crash, union, towels and towelling, table cloths, table napkins and things of that kind. Before we proceed with these items let me indicate the situation to the hon. member for New Westminster. AVe discussed this matter with the British delegation, and there had been quite a duty on this article, as one can see by reference to the previous schedule. There is no Canadian industry to benefit at all; there is only the one industry we have mentioned, making crash towelling, which we are not disturbing. With that exception all these linens, covering a very wide range and a very valuable list, now will come free from the British manufacturer. There is no danger in the world of any holding up of the Canadian producer for a high price, if that was in the mind of my hon. friend. I will say frankly, however, that we do expect that perhaps our American tourist friends coming over here will buy quantities
of these linens, and we hope to build up a very handsome business in that way.


George Gibson Coote: I wonder if the minister could give us some idea of the revenue we have been deriving from these different items in the linen schedules, and what we may expect to lose.


Edgar Nelson Rhodes: If we are going on to deal with items 540, 540a and so on, perhaps we might pass this thread item.


[Stage Direction]
Item agreed to.
Customs tariff-540, 540a, 540b, 540e. From
the four existing linen items marginally named it is proposed to draft a new linen schedule which will accord to the United Kingdom free entry on a very wide range of fabrics and articles, administration of the new legislation to be on the basis suggested by the following tentative proposals:
(a)	woven fabrics, in the web, wholly of flax or hemp, not to include towelling and glass cloth of crash or buck, with or without lettering or monograms woven in, nor table cloths and napkins of crash with coloured borders.
(b)	articles wholly of flax or hemp, such as sheets, pillow eases, table cloths and napkins, towels and handkerchiefs, but not to include towels or glass cloths of crash or huck, with or without lettering or monograms woven in, nor table cloths and napkins of crash with coloured borders: Proposed rates, free, 25 per cent, 27£ per cent; free, 30 per cent, 32J per cent; free, 30 per cent and 3J cents, 32J per cent and 4 cents; free, 30 per cent and 3J cents, 35 per cent and 4 cents.
Edgar Nelson Rhodes: I am sorry to say I have
not the figures before me, but I can give the imports under the four existing items last year. Under item 540 the imports amounted to $170,000, of which $154,000 came from the United Kingdom. Under item 504a the imports totalled $348,000, of which $321,000 came from the United Kingdom. Under item 540b the imports were $401,000, of which $368,000 came from the United Kingdom, and under item 540c imports totalled $978,000, of which $516,000 came from the United Kingdom and $350,000 from other countries.


Mr.   GOOTE@: I was anxious to know whether the minister could tell us the revenue we are likely to lose by putting these different items on the free list.


Edgar Nelson Rhodes: I am sorry to say I cannot give that information now, but I can get it approximately, later on.


[Stage Direction]
Item agreed to.
Customs tariff-541a. AVoven fabrics, wholly of jute, n.o.p.: British preferential tariff, free; intermediate tariff, 22| per cent; general tariff, 25 per cent.
Item agreed to.
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Imperial Conference-Trade Agreements
Customs tariff-551. Yarns, composed wholly or in part of wool or hair, but not containing silk or artificial silk, n.o.p.: British preferential tariff, 15 per cent; intermediate tariff, 20 per cent; general tariff, 224 per cent; and, per pound: British preferential tariff, 11J cents; intermediate tariff, 20 cents; general tariff, 22| cents.
Item agreed to.
Customs tariff-551a. Yarns and warps composed wholly of hair, imported by manufacturers for use in their own factories: British preferential tariff, free; intermediate tariff, 174 per cent; general tariff, 20 per cent; and, per pound: British preferential tariff, ....; intermediate tariff, 15 cents; general tariff, 17 4 cents.
Item agreed to.
Customs tariff-551a. Yarns and warps composed wholly or in part of wool or hair, imported by manufacturers for use exclusively in their own factories, n.o.p.: British preferential tariff, 10 per cent; intermediate tariff, 17J per cent; general tariff, 20 per cent; and, per pound: British preferential tariff, 74 cents, intermediate tariff, 15 cents; general tariff, 174 cents.
Item agreed to.
Customs tariff-552.	Felt, pressed, of all
kinds in the web, not consisting of or in combination with any woven, knitted or other fabric or material: British preferential tariff, 15 per cent; intermediate tariff, 22J per cent; general tariff, 25 per cent; and, per pound: British preferential tariff, 74 cents; intermediate tariff, 171 cents; general tariff, 20 cents.
Item agreed to.
Customs tariff-553. Blankets of any material, not to include automobile rugs, steamer rugs or similar articles: British preferential tariff, 224 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent; and, per pound: British preferential tariff, 10 cents; intermediate tariff, 25 cents; general tariff, 30 cents.
George Gibson Coote: What were the importations under this item?


Edgar Nelson Rhodes: This item covers both woollen and cotton blankets. Of cotton blankets we imported last year $5,500 worth of which $3,500 came from the United States, and of woollen blankets $158,000 of which $150,000 came from the United Kingdom.


Henry Elvins Spencer: What were the tariffs under the old schedule?


Edgar Nelson Rhodes: The old rates were: 224 per cent; 30 per cent and 35 per cent ad valorem, and 20 cents, 26 cents and 30 cents. What we have done in this instance is to cut the specific duty in two in respect to the preference; instead of 20 cents it is 10 cents.


Charles A. Stewart: This is one instance where there is very little imported.


Edgar Nelson Rhodes: I have just given the figures. The importation has not been large.


Henry Elvins Spencer: I think the British preference might have been cut out entirely. Blankets are used by the poorest families and if we can make goods free under other items this might have been included in that list.


Edgar Nelson Rhodes: On the other hand, it
must be remembered that the Canadian industry is working entirely with Canadian wool.


Charles A. Stewart: Canadian
wool?


Edgar Nelson Rhodes: Yes.


George Gibson Coote: And not paying much for
it.


Charles A. Stewart: The minister's statement is surprising. Canadian wool was never as cheap as it is at the present time. The clip in western Canada is practically all in the hands of the producers because they cannot sell it at any price nor can they give it away. Here we are giving the whole market to the Canadian manufacturers. I shall have something to say on Canadian wool under another item.


George Gibson Coote: The thing to do would be
to increase the purchasing power of the Canadian people so as to allow them to buy blankets, which in turn would enable the manufacturers to buy more wool from the farmers.


Edgar Nelson Rhodes: We are all agreed on that.


Mr. BOUCHARD:: I was very much struck, in reference to this matter, by certain figures I saw in the Monthly Bulletin of Agricultural Statistics for March, 1932. There a comparison is given of prices paid for wool. The prices were, for the years from 1922 on, as follows:
Cents per pound
		2U
1924		 25
1925		 25
1926		 23
1927		 22
1928		 26
1929		 22
Then it falls to 11 and 8 and now it is about 4 or 5 cents per pound. I am always struck by something which appears to me to be incongruous in the tariff I am not here to advocate a high tariff on wool or on anything else, but I must remind hon. gentlemen opposite that this government promised the

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farmers to make tariffs fight for them; yet this is the most iniquitous tariff one could imagine. In the United States the tariff on wool is very high. I hope the minister will correct me if I am wrong, but I believe that the specific tariff was adopted in the United States for the purpose of carrying out the tariff which was given to the farmers on wool. In Canada our specific tariff is nearly as high as the specific tariff which was put into force in the United States to take care of the tariff imposed there on wool, but we have no tariff at all on wool. This is the most iniquitous provision that has ever been made in our tariff. No consideration whatever is given the farmer. One would expect that the woollen manufacturers of Canada would at least use Canadian wool. We produce about one quarter of the wool that is used in Canada. Now, when our tariff was increased to the extreme limit, skyhigh, with the specific duty and everything else afforded the manufacturer, no consideration whatever was given the farmer except talk. On July 14, 1931, I drew the attention of the Prime Minister to this very fact. Later on, during the course of last session, the Minister of Finance himself stood up and said that some consideration should be shown the wool growers. I have read many letters in this house from cooperative organizations like the Wool Growers' Association, which is a very influential body in this dominion, and the sheepbreeders in convention in Toronto have passed resolutions and forwarded letters to the Minister of Finance, the Minister of Agriculture and the Minister of Trade and Commerce, all with reference to this subject. The Prime Minister, in answer to my poor utterances, said, "Give us time." He gave us some hope, but we have been given hope so many times that now we should like to see something practical done. If the manufacturers had a little heart they would take at least one-quarter of their wool supplies from the wool producers in Canada. We produce about 20,000,000 pounds of wool, using round figures, and the consumption in Canada is about 80,000,000 pounds. In the Monthly Bulletin of Agricultural Statistics for March, 1932, I read the following:
Wool prices were again below the previous year by at least 25 per cent. Although the woolen manufacturers are expanding their business in Canada, there has apparently been little, if any, increase in the use of Canadian wools by Canadian manufacturers. During the year 4,769,574 pounds were exported to Britain. The wools which are being exported are among Canada's best and very favourable comments are being received in regard to the quality of the product as represented in Canada's officially graded wools.
And quoting again from the same bulletin:
The wool clip in 1931 was of good quality. The expansion of the use of purebred rams was reflected in a further refinement within the official grades. There was very little local buying of wool and prices for ungraded wools ranged from five to eight cents per pound.
And again:
Canadian mills continue to use a limited volume of home-grown wool.
I do not want to press this matter too strongly at the moment, but when the question comes up again I hope to take part in the discussion. This government has pledged itself to do something for the farmer. Take fertilizer, for instance. We soon realize the advantages which are given to the manufacturer. The same thing applies to wool; the farmer receives no consideration from the government or from the manufacturer. He receives only four to five cents per pound for his product, while the manufacturer benefits by a specific and ad valorem duty. If I am not in error, I understand that in the United States a specific duty alone is considered all that is necessary in the way of a tariff on wool. It is considered that about two and a half to three pounds of virgin wool is required to make one pound of manufactured cloth, so that the tariff on wool is about one-third of the specific tariff on cloth. I wish the minister would give us some hope of possible relief to our farmers.


Edgar Nelson Rhodes: My hon. friend will appreciate that it is not given to me to have the same freedom of utterance with respect to my views as it is to him. However, I commend the utterances of my hon. friend. I have great sympathy with the views he has expressed, but he will appreciate that this is not a matter which should be dealt with at this time; it is a matter for tariff revision at the time of the regular budget. I can assure my hon. friend that the point he raises is under advisement and I hope I shall be able to discuss it with him sympathetically when the proper time comes.


Edward James Young: This is one of the items upon which we have been able to figure out what the rate will be. The actual rate on goods under this item coming from Great Britain will be 53.6 per cent. A moment ago the minister told us that the Canadian factories were working almost entirely with Canadian wool, but I have before me the report of the woollen and textile industry in Canada for the year 1931, published by the bureau of statistics, which gives the following figures:
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Imperial Conference-Trade Agreements
Domestic wool used, 2,479,000 pounds valued at $551,000.
Foreign wool used, 3,806,000 pounds valued at $1,429,000.
That does not look as though our woollen manufacturers were confining themselves entirely to Canadian wool. The consumption of foreign wroo! is fifty per cent higher than that of domestic wool, while the value was nearly three times as much. Last year the Canadian woollen manufacturers put on an exhibition in the Chateau Laurier. They had some very fine woollen cloths displayed and the men in charge understood their business. They explained to us that they could not use Canadian wool in the manufacture of these fabrics; that they had to use foreign wool. What good is this tariff doing the Canadian wool grower? I have a neighbour who produced 3,000 pounds of wool last year. When he had paid for the clipping and the freight to Regina he did not have enough left to buy himself a suit of underwear. With a duty of 53.6 per cent against wool coming from foreign countries, is there any chance of the consumption of wool increasing in Canada? The Canadian farmer will receive no benefit because, as the hon. member for West Edmonton has said, he cannot sell his wool. I want to know who is to benefit under these high duties.


Charles A. Stewart: The manufacturer, of course.


Edward James Young: How many men are employed and what wages do they receive?


Henry Elvins Spencer: A few moments ago I asked the Minister of Finance, who is not now present, if he would not consider letting these goods come in free from Great Britain. He told me that the manufacturers were using Canadian wool entirely.


Henry Herbert Stevens: No. In regard to blankets a large proportion of Canadian wool is used.


Henry Elvins Spencer: I was going to ask the minister if in view of the figures given by hon. members he would still hold to his statement that Canadian wool was being used sntirely.


Henry Herbert Stevens: I looked into this matter myself three or four months ago. I was in touch with two or three manufacturers of blankets, and one man told me that he was using one hundred per cent Canadian wool, while one or two others stated they were using a large percentage.


Charles A. Stewart: In the manufacture of a small range of products.


Henry Herbert Stevens: Quite so. I think it should be recognized that Canadian blanket manufacturing is really one of the most efficient industries in the country. A marvellously fine article is turned out, I think at a reasonable price.


Charles A. Stewart: We will
agree with what the minister says in that regard, but it is only in the manufacture of very rough fabrics that one hundred per cent Canadian wool is used. The finer blankets are made from Australian wool.


Henry Herbert Stevens: I think that is true.


Charles A. Stewart: That is our complaint. Why do they need a tariff of 53 per cent on a raw product when they use the smallest possible amount of the home grown raw material?


[Stage Direction]
Item agreed to.
Customs tariff-554. Woven fabrics, composed wholly or in chief part by weight, of yarns of wool or hair, not exceeding in weight six ounces to the square yard, n.o.p., when imported in the gray or unfinished condition, for the purpose of being dyed or finished in Canada: British preferential tariff, 20 per cent and 91 cents per pound; intermediate tariff, 25 per cent and 174 cents per pound; general tariff, 30 per cent and 20 cents per pound.
Item agreed to.
Customs tariff-554a. Woven fabrics, consisting of cotton warps with wefts of lustre wool, mohair or alpaca, generally known as lustres or Italian linings, n.o.p.: British preferential tariff, free; intermediate tariff, 20 per cent; general tariff, 25 per cent.
Charles A. Stewart: What are the imports?


Edgar Nelson Rhodes: The imports last year were $7,780,000, of which $5,830,000 came from the United Kingdom, $189,000 from the United States, $95,000 from France, $61,000 from Italy and $48,000 from Germany.


[Stage Direction]
Item agreed to.
Customs tariff-554b. Woven fabrics, composed wholly or in part of yarns of wool or hair, n.o.p.: British preferential tariff, 27J per cent and 18J cents per pound; intermediate tariff, 35 per cent and 30 cents per pound; general tariff 40 per cent and 35 cents per pound.
Item agreed to.
Customs tariff-554b. Woven fabrics, composed wholly or in part of yarns of wool or hair, weighing not less than 18 ounces per square yard: British preferential tariff, 25 per cent and 20 cents per pound; intermediate tariff 35 per cent and 30 cents per pound; general tariff 40 per cent and 35 cents per pound.

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Ian Alistair Mackenzie: What is the difference with regard to content between this item and the preceding one?


Edgar Nelson Rhodes: The first is the very heavy cloth.


[Stage Direction]
Item agreed to.
Customs tariff-554b. Woven fabrics, composed wholly or in part of yarns of wool or hair, commonly known as billiard cloth: British preferential tariff, free; intermediate tariff, 35 per cent and 30 cents per pound; general tariff, 40 per cent and 35 cents per pound.
George Gibson Coote: We are not sure what item we are discussing, Mr. Chairman.


Armand Renaud La Vergne: This is item ex 554b at the top of page 21 of the bill. There are tw.o items numbered ex 554b. It is the second one we are now discussing.


Charles A. Stewart: What is the importation?


Edgar Nelson Rhodes: This is an entirely new item and the importations have not been segregated.


Ian Alistair Mackenzie: Do we make billiard cloth in Canada at all?


Edgar Nelson Rhodes: No.


Ian Alistair Mackenzie: Is this going to make it more expensive to get billiard cloth?


Edgar Nelson Rhodes: No, we are making it free.


Charles A. Stewart: There is a vast difference between this item and the other one so far as the British preference is concerned. The imports would be small in any case, and I suppose they could not get any reduction in the other item.


Henry Herbert Stevens: Thankful for small mercies.


[Stage Direction]
Item agreed to.
Customs tariff-555. Clothing, wearing apparel and articles made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly or in part of wool or similar animal fibres, but of which the component of chief value is not silk nor artificial silk, n.o.p.; fabrics, coated or impregnated, composed wholly or in part of yarns of wool or hair, but not containing silk nor artificial silk, n.o.p.: British preferential tariff, 30 per cent and 18| cents per pound; intermediate tariff, 40 per cent and 32J cents per pound; general tariff, 40 per cent and 35 cents per pound.
George Gibson Coote: What are the importations under this item?


Edgar Nelson Rhodes: The importations last year were $1,091,000, of which $714,000 came from the United Kingdom, $268,000 from the United States, $51,000 from France and $25,000 from Czechoslovakia.


George Gibson Coote: I have not asked the minister to work out any of these specific tariffs on a percentage basis but I think that the tariff charged against Great Britain under this item is so high as to be absolutely indefensible. In this item, comprising clothing, wearing apparel and articles made from woven fabrics, the duty under the British preference is 30 per cent and 18J cents per pound. This is an item of very great importance to the public, and it is very much to be deplored that such extremely high tariff rates are maintained on this item, while billiard cloth and women's dress gloves of kid, elbow length, come in free. This clothing, which is worn by a great body of our people, is taxed thirty per cent plus 18f cents per pound. I have no idea what the specific rate would work out as expressed in percentages, but I would appreciate it if the minister would let the committee know what it is.


Edgar Nelson Rhodes: If my hon. friend has any particular commodity in mind I will endeavour to have the computation made. This item is very wide in its range, covering a thousand different articles.


George Gibson Coote: I suggest that the computation be made on a man's winter overcoat.


Edgar Nelson Rhodes: I will have the computation made and endeavour to give it to the committee at the next sitting.


Charles A. Stewart: My hon-friend from Macleod will find that the duty works out at about 91 per cent, and taking the schedule as a whole he will find that the duties work out at something over 60 per cent. It is a beautiful example of tarifffixing gone mad. I do not know any country in Christendom that requires overcoats more than we do in Canada. There is a slight reduction from the heights to which hon. gentlemen opposite put this tariff previously, but if anyone can tell me that there is any possibility of the Canadian manufacturer being disturbed by the tariff granted here I should like to know it. The government is going to ridiculous extremes in the tariff on textiles in a country like this which needs both cotton and wool fabrics for every member of our population, and these duties are to give the Canadian manufacturer the market in Canada. I happen to know that two of the principal manufacturers in Canada would have been quite well satisfied with a very moderate tariff, for they so informed us when we were in office. They did not get what they asked from us, and now they are getting three times as much from the present gov-
1348	COMMONS
Imperial Conference-Trade Agreements
eminent. They are using very little Canadian wool. They are buying the imported material and in a protected market such as they now enjoy in this country they are in a position to soak the Canadian consumer to the limit. That the Canadian manufacturer is taking full advantage of the tariff is proved by the fact that we still have a small amount of imports of this article. Otherwise there would be no imports. No more glaring example could be found of the extraordinary lengths to which the government have gone in soaking the Canadian consumer of wearing apparel, something that we need and must have in Canada, and which the government know we must have. And then they tell us that this is done in order to preserve the industry! Why, Mr. Chairman, if you counted every man who is engaged in this industry in Canada today you would not get a total more than 40,000, and I venture to say that in a generous estimate. We have
700,000	people out of work, and the government is asking them to pay this exorbitant price for wearing apparel which they must have in a climate like ours. It is tariff-making gone mad. The excuse which the government give that woollen mills in this country have been revived by the tariff does not hold water. We cannot get a reasonable price for our wool; for these mills are not using Canadian wood. Wool is in just the same predicament as butter and eggs, which this government undertook to increase in price to the producer. In every instance the Canadian consumer is the loser. In connection with secondary industries we find that tariffs are clamped on which force him to pay exorbitant prices for the goods he must use. With the single exception of the small woollen manufacturer I would say that the textile industry was getting along pretty well on the protection they enjoyed during the ten years the previous government held office. They were making splendid progress and did not need this extra assistance. No one can convince me there is any necessity for the exorbitant tariffs on textiles provided by this government.
I hope the government will appoint a tariff board; I hope the textile industries will be investigated before that board, and that it will have some conception of what is reasonable, just and fair as between producer and consumer. Of all the increases hon. members opposite have made this is the worst. [DOT] The government has not given the British manufacturer the slightest chance to get into the Canadian market; he is being offered no greater advantage than he possessed under the tariffs of 1930 and 1931. The small re-

ductions on cotton textiles, as they appear in the schedule, mean very little, and will be of no benefit to the British manufacturer. I say here and now that Great Britain has been one of the best customers for Canadian natural products. Here is one set of items in the schedule from which Great Britain could have received some benefit; we would have been giving something back, but hon. gentlemen have chosen to ignore any such arrangement. The marvel to me is that the British delegation treated us so generously at the recent conference. I cannot understand it. In connection with articles which they can manufacture, and with which they can enter into competition on the world market, they are not given a chance to compete in the Canadian market. In commodities the trade in which amounts to little or nothing, and on certain raw products, some chance is given to Great Britain, but very little. I am interested in the consumers of Canada, those men and women who will have to pay and pay dearly as they have done on every occasion that a policy of extreme protection has been put into effect. Particularly is that true in connection with articles of clothing.


Edgar Nelson Rhodes: The hon. member seems to overlook entirely the fact we are passing through a period the like of which has never been known before in the history of the world.


Charles A. Stewart: I know all about it; I am living on a farm.


Edgar Nelson Rhodes: Quite so; and he overlooks entirely the statement which has been made so frequently by hon. members on this side of the house, to the effect that we are treating emergent conditions by emergent methods.


Edward James Young: At whose expense?


Edgar Nelson Rhodes: We are not suggesting for one moment that the tariff as it now stands in respect to textiles or other articles is there for all time. The tariff changes are being made to meet a specific condition obtaining in Canada.


Ian Alistair Mackenzie: We will change it next year.


Edgar Nelson Rhodes: Nobody will be more delighted than myself when the time arrives that we may deal with normal conditions in a normal way. It must be borne in mind that the textile industry in Canada is extensive. It spreads from coast to coast, and affords the very backbone of the livelihood of many Canadian communities. Despite the condition about which the hon. member for West Edmonton complains, the fact is that in the history of Canada clothing has never been as

United Kingdom
cheap as it is today. He must not overlook that fact, and he is not doing justice to the situation when he compares tariff legislation under existing conditions with legislation designed to meet ordinary conditions of normal times.


George Gibson Coote: How far back is the minister going in his statement that clothing never has been as cheap in Canada as it is today?


Edgar Nelson Rhodes: Well, so far as I can ascertain it has not been as cheap in the last half century.
Some lion. MEMBERS: Oh, oh.


Edward James Young: You are misinformed.


Martin James Maloney: Before the minister
addressed the committee I had intended to express my surprise that the hon. member for West Edmonton, with his long and honourable public career and wide experience in public matters, could deliberately stand in committee and make such statements concerning conditions in the textile plants of this country. He knows as well as we do that today clothing is selling for less than half what it sold for two years ago.


Edward James Young: No, it is not. We do not know that at all.


Martin James Maloney: He knows well that a
little over two years ago the textile industry of Canada was on its back. The plants which were locked up tightly two years ago are now running wide open and giving employment to hundreds and hundreds of men throughout Canada. The argument of the hon. member is not one we might expect from a man of his experience.


Ian Alistair Mackenzie: I believe the hon. member for Battle River asked a question concerning overcoating. Turning to the figures I find that in 1931 the total imports of overcoating were valued at 8803,000, and that in 1932 they had decreased to
8276,000.


George Spotton: Is this a new minister?


Ian Alistair Mackenzie: From the United Kingdom the imports in 1931 were valued at 8538,000 and in 1932 at $196,000. The idea behind this tariff is the entire prohibition of imports. The hon. member who has just taken his seat has stated that the present prices in Canada are low. I direct his attention to the fact that that condition is not peculiar to Canada but obtains throughout the world, and applies to all commodities. Under the guise of a British preference, and with an imperial agreement
before us, we are locking the door more securely than ever against Great Britain in connection with textiles. We are locking the door against imports from Great Britain; the Minister of Finance and Minister of Trade and Commerce know it. Nothing in this agreement has caused so much vexation and irritation in the old country as the fact that we have refused to give them a decent chance to sell their textiles. I agree with my hon. friend when he states that we should do anything we can to provide labour and promote industry in Canada. But the price is too high. For the last two years, for reasons not difficult to analyze, this government has shown special favouritism to the textile industry of Canada. If hon. members wish I shall analyze that favouritism.


Mr. MORAND:: Go ahead.


Ian Alistair Mackenzie: The
Dominion Textile Company have received more favours from this government in the last two years than any other single industry in Canada.


Martin James Maloney: Has it cost you anything?


Ian Alistair Mackenzie: Yes, and every consumer in the Dominion of Canada. I will tell my hon. friend that the tariff schedule as applied to the textile industry in Canada is not justified by any law of economics, fair play or common sense, and the consumer of Canada is paying for it. If you look at your importations of textiles from the old country during the last three or four years you will see that the door has been gradually closed on textiles from the old country, building up a monopoly in Canada. When you create a monopoly for an industry in Canada you are imposing a burden on the consumer. I want to tell my hon. friends that the big problem today in Canada, far bigger than any item in this agreement, is that of trying to look after the hundreds of thousands-800,000 we were told by the Minister of Labour (Mr. Gordon) the other day -who are under or in need of relief; yet the poor man who wants to buy an overcoat or any textile fabric is penalized by these tariffs. Why is this in the imperial conference agreement? Is it to promote imperial trade? Will any hon. member on the other side will dare to say that this is promoting British trade? Look at the figures for the last three or four years, and you will see, whether you will approve, as do hon. members on that side of the house, or disapprove, as we do, that year by year you are closing the door against the importation of British textile fabrics into Canada. Under the guise of promoting British
1350	COMMONS
Imperial Conference-Trade Agreements
trade, promoting imperial preference, we have here some twenty items, in respect to every one of which the monopoly of Dominion Textiles is being buttressed very visibly and very emphatically. It should not be in this agreement at all. If my hon. friends want to carry out any promises or bargains they made in 1930, they should do it in the budget to be presented' to this house next February or March. This is not promoting British trade; it is monopoly, it is high protection for Dominion Textiles at the expense of the consumers throughout Canada.


Edgar Nelson Rhodes: Just for the purpose of accuracy-my hon. friend from Vancouver has quite inadvertently slipped into error-this item has no bearing upon or reference to or association with Dominion Textiles in any way, shape or form. This is a woollen item, and they manufacture only cottons.


Ian Alistair Mackenzie: I was discussing the entire textile fabrics, because I was not in the house-


Edgar Nelson Rhodes: Quite so; I only want to make it clear that this item has no reference whatever to Dominion Textiles, nor has it anything to do with monopoly. It has to do with some 74 different industries scattered throughout this country which today are keeping alive many communities; and I may add that but for the tariff action taken by this administration many thousands more would be added to the ranks of the unemployed and would be on relief in Canada at this time. I say that just as a matter of simple justice to my hon. friend.
One thing more; my hon. friend is very strong in his assertion that by this tariff provision we are excluding the British from an opportunity to enter this market. May I say to him that surely the British ought to be the best judges of that circumstance, and they have signed the agreement.


Ian Alistair Mackenzie: They were not satisfied.


Edgar Nelson Rhodes: That may be so, but the
British are pretty shrewd traders. I do not know that my hon. friend has said so, but many of those who surround him have been at pains to indicate that we have been "taken into camip " by them, the only comment in that regard is that he should be perfectly satisfied if those who are directly concerned, through their representatives on the British delegation, were satisfied.


Ian Alistair Mackenzie: In regard to the statement that the tariff policy of this

government has given employment to several thousand-or hundreds of thousands, did the minister say?


Edgar Nelson Rhodes: I said thousands.


Ian Alistair Mackenzie: I allege
without the slightest fear of successful contradiction that the tariff policy of this government has driven out of employment thousands upon thousands of people throughout Canada.


An hon. MEMBER:: Tell us how.


Abraham Albert Heaps: Could the minister inform the committee as to the total amount of production in Canada that this item covers?


Edgar Nelson Rhodes: I will not attempt to give all the items covered. It would take pages-


Abraham Albert Heaps: This one item.


Edgar Nelson Rhodes: -but I will give some, I will give round figures:
Clothing, men's	 $	340,000
Clothing, women's	 83,000
Other clothing	 398,000
Boys overcoats and reefers..	..	1,391,000Men's topcoats and overcoats..	. .	8,439,000Women's coats and cloaks	
17,000,000Blazers	136,000Mackinaws	
526,000Washable coats	
140,000Coats, waterproof and rain..	..	618,000Windbreakers	
297,000Coats, not specified	
139,000Dresses	
26,901,000Dressing gowns, negligees, bathrobes, etc	
1,799,000
Gaiters, spats and leggings.... 237,000
Jerseys	 183,000
Uniforms, military and athletic..	236,000
Suits and pants for boys	 3,620,000
Men's suits	 22,428,000
Women's suits	 3,000,000


Abraham Albert Heaps: Could the minister in the
same rough way give the importations under the same headings?


Edgar Nelson Rhodes: I gave that previously-


Edward James Young: I have been trying to do a
little figuring from the report of the bureau in regard to the woollen industry'. I find that it employs 8,208 persons; that it pays in salaries and wages $7,425,000. The total value of the product last year was $25,500,000. The imports last year were $20,000,000 as against $39,000,000 the year before. If we add to the imports the value of the product last year we get $45,500,000 as the total woollen goods consumed in Canada. Taking the year before, our production was $27,000,000 and im-

United Kingdom
ports $39,000,000, a total of 866,000,000 worth consumed in Canada. So that the net result of the policy of the government has been to decrease the consumption of woollen goods in Canada by about one third, making them so dear that in a country with a climate like this the people cannot use them-all to give employment to 8,000 people who draw $7,-
500,000	in wages, although with an average duty of 60 per cent and a total production and importation of $45,000,000, the industry is costing us approximately $27,000,000.


[Stage Direction]
Item agreed to.
Customs tariff-568a. Socks and stockings of all kinds: British preferential tariff, 30 per cent and 75 cents per each dozen pairs; intermediate tariff, 32i per cent and $1.35 per each dozen pairs; general tariff, 35 per cent and $1.50 per each dozen pairs.
Edward James Young: What is the applied rate
on this?


Ian Alistair Mackenzie: I wonder if the minister could tell us how much the importation has decreased in the last two years, if at all.


Edgar Nelson Rhodes: We are exporting a lot
now.


Ian Alistair Mackenzie: Yes, I
know-but the importations from Great Britain.


Edgar Nelson Rhodes: I have only the figures for last year. We imported goods last year to the value of $856,000, and our exports totalled $766,000.


Ian Alistair Mackenzie: The
tendency has been to cut down on the importation of socks and stockings under this item?


Edgar Nelson Rhodes: We imported $17,000 worth of cotton socks from the United Kingdom, $8,000 of, silk, $14,000 of artificial silk and $736,000 of wool.


Ian Alistair Mackenzie: Could the minister say how that compares with the preceding year, in a general way?


Edgar Nelson Rhodes: No doubt there would be
a reduction because of the lower unit cost. The year before our importations totalled $1,823,000.


Charles A. Stewart: What were
our exports, and to what countries did they go?


Edgar Nelson Rhodes: We exported $285,000
worth to New Zealand, $266,000 worth to South Africa and $88,000 worth to the United Kingdom.


Charles A. Stewart: Do we enter free now?


Edgar Nelson Rhodes: Yes, I think so.


Charles A. Stewart: Then I want to congratulate the minister on that deal, which should be a pretty good one for Canada with the duty we have against importations. I honestly wish to congratulate the government on a very splendid deal of this kind. The amazing thing is how they put it over. I have much more admiration for the government now than I ever had.


Edward James Young: I should like to say just,
one word in regard to socks and stockings. I discussed this matter with a woollen importer, who told me he was going out of the business of importing woollen socks beoause he could not handle them with the duties now imposed against them. I asked what difference these duties would make to the price. He said the duties would not make any difference to the price, but that they had made a tremendous difference in the quality. So now we must wear inferior socks because of these duties.


[Stage Direction]
Item agreed to.
Customs tariff-568b. Women's dress gloves of kid, elbow length: British preferential tariff, free; intermediate tariff, 35 per cent; general tariff, 45 per cent.
Ian Alistair Mackenzie: May I
ask the minister who made representations to the government in regard to this item?


Edgar Nelson Rhodes: I have observed some
criticism of this item on the ground that it is a luxury and therefore should have been taxed. The feeling we had, however, was that it was a commodity which could be imported in large quantities and sold to the tourist trade with very marked advantage, and that what we might lose in customs imposts would be more than made up in the indirect way. For that reason we felt that this was a concession which we could make to the glove trade of the United Kingdom, because this commodity is not made in Canada.


Ian Alistair Mackenzie: They are all imported from the United Kingdom?


Edgar Nelson Rhodes: Yes.


Mr. RALSTON:: My information is that
they are not made in the United Kingdom at all.


Edgar Nelson Rhodes: Yes; according to our information this is a big item.
1352	COMMONS
Imperial Conference-Trade Agreements


James Layton Ralston: Will the minister tell me the imports from the United Kingdom?


Edgar Nelson Rhodes: This is an entirely new
item, so I am sorry I cannot give my hon. friend that information. The imports have not been segregated.


James Layton Ralston: I do not want to delay the item, but I thought I had very good information indeed to the effect that all these gloves were made in France or on the continent and that no such gloves were made in England.


Edgar Nelson Rhodes: I can assure my hon. friend that this was checked up with the British delegates, and we are satisfied beyond question that they are manufactured in quantities in Great Britain.


[Stage Direction]
Item agreed to.
Customs tariff-572. Turkish or imitation Turkish or other floor rugs or carpets, and carpets n.o.p.: British preferential tariff, 30 per cent and 5 cents per square foot; intermediate tariff, 35 per cent and 15 cents per square foot; general tariff, 40 per cent and 20 cents per square foot.
Edward James Young: Could the minister tell us what percentage of empire content there will be in a Turkish rug?


Edgar Nelson Rhodes: This is not a rewritten
item, Mr. Chairman; this is the old item with the rates changed. I do not say that the words I am about to speak are absolutely authoritative, but I believe I am correct when I sajt that the words " Turkish " or " imitation Turkish " do not imply that of necessity the rug comes from Turkey.


Edward James Young: They will be oriental rugs.


Edgar Nelson Rhodes: Yes, or they may be of oriental design, manufactured in Great Britain. On that point my hon. friend will recall that we have the safeguard of the empire content provision, which I think would ensure that these were British rather than foreign goods.


Edward James Young: Surely the minister does not mean that if we go down and buy a Turkish rug it might be only of Turkish design?


Edgar Nelson Rhodes: I will say this, that if we buy an imitation Turkish rug certainly that is not a Turkish rug, which, so far as I can ascertain, may be a trade name. It does not necessarily mean that the rug comes from Turkey, but whether or not that be so, the empire content provision would preclude a Turkish rug coming from Turkey talcing advantage of the British preference.


[Stage Direction]
Item agreed to.

Customs tariff-586. Coal, anthracite, n.o.p., per ton: British preferential tariff, free; intermediate tariff, 50 cents; general tariff, 50 cents.
James Layton Ralston: I should like to make just one observation on the question of coal; it has no reference to the duty, but it has regard to the coal production and t'he coal business particularly in the eastern provinces. I want to urge upon the government and particularly upon my friend the Minister of Finance, in the strongest possible way, some revision whereby advantage may be taken in a larger way by the Canadian National Railways of the subvention in order to induce the company to use more eastern coal. My hon. friend will remember that last year a change was made in the subvention, but it was made applicable only to the additional tonnage which the Canadian National might use. As a matter of fact I understand that this year the Canadian National has used less coal than previously, and therefore the benefit of that subvention has not been felt. I know that this is about the time the government will be revising or considering the renewal of these subventions, and I want to urge as strongly as I can that they be so adjusted that the Canadian National Railways may be induced to use more eastern coal.


Edgar Nelson Rhodes: I am sure my hon. friend would not expect me to enter into a lengthy discussion of the coal subventions in connection with an item concerning coal which appears in these trade agreements. I can assure him, however, that I am equally anxious that everything possible should be done to assist the coal industry both in the east and in the west. When we are discussing this matter at a later stage in the session I shall be very glad indeed to go into the matter with my hon. friend more fully. In the meantime I can assure him that anything in addition we can do or think should be done for the industry will not be lost sight of.


Ian Alistair Mackenzie: Has the minister before him the figures in regard to the importation of British or Welsh anthracite in the last two years, and does he consider that the additional tariff protection of 10 cents will be of material advantage in connection with the importation of Welsh anthracite into Canada?


Edgar Nelson Rhodes: The importations of United Kingdom coal this year already are over one million tons. I have the figures beginning with April and running up to the end of September and they indicate that we have imported in this current year during a period of six months 945,217 tons.

United Kingdom


Ian Alistair Mackenzie: Is it increasing month by month?


Edgar Nelson Rhodes: Yes. Last year our imports of British anthracite represented 23 per cent of the total anthracite importations, whereas for the six months' period I quoted that percentage had gone up to 55 per cent, indicating a marked increase.


Charles A. Stewart: There must be some mistake about the 23 per cent. Needless to say, I am delighted to know that there is an ever-growing importation of British anthracite. We did run up to about
800.000	tons, but we import only 3,000,000 tons all told now.


Edgar Nelson Rhodes: Twenty-three per cent of
our importations for 1931-32 came from the United Kingdom. These are official figures.


Charles A. Stewart: The importation last year was about 800,000 tons.


Edgar Nelson Rhodes: More than that.


[Stage Direction]
Item agreed to.
Customs tariff-ex 598. Brass band instruments, of a class or kind not made in Canada; bagpipes: British preferential tariff, free; intermediate tariff, 30 per cent; general tariff, 35 per cent.
Ian Alistair Mackenzie: I object
to the way in which this item is drawn up. It provides for, "brass band instruments of a class or kind not made in Canada; bagpipes." With all deference to the minister, I suggest that bagpipes are worthy of an item by themselves. I think it is an insult to a great and glorious race and to a wonderful section of the Canadian community to have bagpipes classified as a secondary article. The hon. member for New Westminster and myself would like the Minister of Finance to have bagpipes inserted as a special item in the Canadian tariff.


Thomas Reid: Naturally it is not to be
expected that I rise to oppose this item; far be it from me to do so. Of course, it does not affect me personally because I have a set which probably will last me all my days.


Charles A. Stewart: Do you
want parts?


Thomas Reid: One thing that pleases me
particularly is the fact that it is now settled that bagpipes are a musical instrument. There are probably between fifty and sixty bands in Canada and there are well over a thousand pipers, and the number is increasing year by year, but in connection with this item there 53719-86
is great difficulty with the customs board so far as parts are concerned. The customs officers are inclined to view parts as separate, and they interpret bagpipes to mean the complete instrument. I would ask the minister in all seriousness to have this item amended. Parts are brought in and they are necessary for repairs, and as there are men in Canada who are building up an industry by importing parts for sale, I think the suggested change should be made. I have received protests from various sources with regard to this matter and I would ask that all parts used in connection with bagpipes be entered free as well as the bagpipes themselves.


James Shaver Woodsworth: Since my office
is on the sixth floor, I protest against any more bagpipes coming in.


Thomas Reid: I naturally look for a protest
from the hon. gentleman. No lover of good music would protest.


An hon. MEMBER:: Who asked for this?


Edgar Nelson Rhodes: It has been suggested to
me that these are Reid instruments. I take it that my hon. friend from Vancouver Centre will not press so seriously his complaint that the item was not inserted by itself, in view of the fact that the hon. member for New Westminster is so delighted that at last the bagpipes has been acknowledged to be a musical instrument, and is therefore included with brass band instruments and other instruments that make music. I may tell him seriously, however, that I will take into careful consideration his suggestion with respect to parts and if it can be acceded to we can deal with the suggestion in ways and means.


[Stage Direction]
Item agreed to.
Customs tariff-604. Belting leather in butts or bends; sole leather, and all leather further finished than tanned, n.o.p.: British preferential tariff, 12J per cent; intermediate tariff, 274 per cent; general tariff, 274 per cent.
Item agreed to.
Customs tariff-604. Genuine pig leathers and genuine Morocco leathers; so-called roller-leathers: British preferential tariff, free; intermediate tariff, 274 per cent; general tariff, 274 per cent.
Item agreed to.
Customs tariff-605. Leather produced from East India tanned kip, uncoloured or coloured other than black, when imported for use exclusively in lining boots and shoes; genuine reptile leathers: British preferential tariff, free; intermediate tariff, 15 per cent; general tariff, 15 per cent.
Item agreed to.
[Stage Direction]
1354	COMMONS
Imperial Conference-Trade Agreements
Customs tariff-607a. Leather, not further finished than tanned, in whole hides, in grains or splits, when imported by manufacturers of upholstering leathers for use exclusively in the manufacture of upholstering leathers, in their own factories: British preferential tariff, free; intermediate tariff, 15 per cent; general tariff, 15 per cent.	_
Provided, that the governor in council may, when satisfied that the leather specified in this item is being produced in Canada, in quantity and quality sufficient for Canadian requirements. by order iiv council direct that this tariff item be repealed.
Item agreed to.
Customs tariff-610. Belting of camel's hair, for machinery: British preferential tariff, 15 per cent: intermediate tariff, 27J per cent; general tariff, 27i per cent.
Item agreed to.
Customs tariff-617. India-rubber boots and shoes: British preferential tariff, free; intermediate tariff, 22i per cent; general tariff, 25 per cent.
Item agreed to.
Customs tariff-625. Caps, hats, muffs, tippets, capes, coats and cloaks of fur and other manufactures of fur, n.o.p.: British preferential tariff, 15 per cent; intermediate tariff, 30 per cent; general tariff, 35 per cent.
Item agreed to.
Customs tariff-663. Fertilizers, compounded or manufactured, n.o.p.:	British preferential
tariff, free: intermediate tariff, 7J per cent; general tariff, 10 per cent.
Thomas Reid: Will the minister make a statement regarding the question I have raised in connection with this item?


Edgar Nelson Rhodes: As soon as we get through the list we will refer to that.


[Stage Direction]
Item agreed to.
Customs tariff-684.	Rubber thread, not
covered: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 15 per cent.
Item agreed to.
Customs tariff-711. Barytes: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 25 per cent.
Item agreed to.
Customs tariff-711. Charcoal, animal, for use in the refining of sugar: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 25 per cent.
Item agreed to.
Customs tariff-711. Mineral wool: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 25 per cent.
Item agreed to.

Customs tariff-711. A new item (not finally drafted) to provide that all chemicals and drugs which were dutiable at the date of the conference, under item 711 at: British preferential tariff, 15 per cent; intermediate tariff, 25 per cent; general tariff, 25 per cent; shall be in future, when of a kind not produced in Canada, dutiable at: British preferential tariff, free; intermediate tariff, 25 per cent; general tariff, 25 per cent.
Ian Alistair Mackenzie: Will the minister explain this?


Edgar Nelson Rhodes: I think I could explain that better in committee of ways and means. The item is a new one and is all-embracing. It includes a very large list of every drug that is used in Canada, not manufactured here, and it is a very heavy item.


[Stage Direction]
Item agreed to.
Customs tariff-728. Hyposulphite of soda, when imported by tanners for use in their own factories in the tanning of leather: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 10 per cent.
Ian Alistair Mackenzie: This was free all across the board before the present tariff.


Edgar Nelson Rhodes: This was one item which the British representatives laid special stress upon; it was included in their special list.


[Stage Direction]
Item agreed to.
Customs tariff-783. Gasoline and steam engines, transmission assemblies and parts thereof, magnetos, starting motors, electric generators, propeller shafts, steel chassis frames, brakes, clutches, brake and clutch controls, steel road -wheels, steel rims for pneumatic tires, larger than thirty inches by five inches, steering gears and front and rear axles, all of a class or kind not made in Canada when imported by manufacturers of motor trucks (not for railways or tramways) for carrying goods only, for use only in the manufacture of such motor trucks: British preferential tariff, free; intermediate tariff, 17J per cent; general tariff, 20 per cent.
Item agreed to.
Customs tariff-785. Cocoanut oil, not edible, when imported for use in the manufacture of refined cocoanut oil: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 10 per cent.
Item agreed to.
Edgar Nelson Rhodes: It will be recalled that considerable discussion took place previously with respect to the use of nitrate of soda as a fertilizer. I made the statement that this article could be imported free by agricultural interests provided it was mixed with some

United Kingdom
other Commodity, even with sand. I find that in actual practice the Department of National Revenue has never attempted to police or follow up the use of nitrate of soda when purchased by those in the agricultural industry, the simple statement that it was to be used for fertilizer having been accepted as sufficient. However, in order to make that quite clear I propose an amendment in the form of a new item 210e.


Henry Herbert Stevens: I move that the following
be substituted as item 210e:
210e. Nitrate of soda or cubic nitre, when imported for use as a fertilizer, or when imported by manufacturers of explosives for use exclusively in their own factories in the manufacture of explosives: British preferential tariff, free; intermediate tariff, free; general tariff, free.


Ian Alistair Mackenzie: Will the hon. minister consider moving a similar amendment in connection with barbed wire and cream separators?


[Stage Direction]
Amendment agreed to.
Schedule as amended agreed to.
On schedule F.
Ian Alistair Mackenzie: I think article 19 should be considered in connection with this schedule.


Henry Herbert Stevens: Perhaps the Chairman will be good enough to read article 19.


Armand Renaud La Vergne: Article 19 reads:
His Majesty's government in Canada undertake to accord to those non-self-governing colonies, protectorates and the mandated territories to which the benefits of the British preferential rates are at present accorded and also to Zanzibar the preferences on the commodities and at the rates shown in schedule F and also any preferences for the time being accorded to the United Kingdom. Provided that His Majesty's government in Canada shall not be bound to continue to accord any preferences to any colony or protectorate which, not being precluded by international obligations from according preferences, either (i) accords to Canada no preferences or (ii) accords to some other part of the empire (in the case of Northern Rhodesia, excepting the Union of South Africa, Southern Rhodesia and the territories of the South African High Commission) preferences not accorded to Canada.


Ian Alistair Mackenzie: I should like to ask the minister one or two questions in connection with article 19. Which of the non-self-governing colonies do not accord preferences to Canada, and is the special preferential arrangement with Northern Rhodesia better than the general arrangement arrived at in this agreement?
53719-86J


Henry Herbert Stevens: Regarding that exception, "in the case of Northern Rhodesia, excepting the Union of South Africa," that appears all through the agreement. That is a local arrangement between the different colonies in the Union of South Africa.


Charles A. Stewart: Is it under a treaty?


Henry Herbert Stevens: It is an agreement between themselves.


Ian Alistair Mackenzie: Are the preferences accorded under that arrangement more extensive than those under the agreement we are now considering?


Henry Herbert Stevens: I have not checked them, but I imagine possibly they are. It is something like the Canada-West Indies agreement.


James Layton Ralston: Are any of these non-selfgoverning colonies precluded by international obligation from granting preferences?


Henry Herbert Stevens: There is an agreement affecting the British West African colonies, known as the Nigerian agreement. It is an old Anglo-French treaty which goes back many years. I believe the whole matter is under consideration at the present moment, but I do not think it is desirable to stir up anything. I do not think the business available warrants this action, nor do I think it would be desirable in any case.


James Layton Ralston: The apparent binding
effect of international obligations gives a point to the argument which has been repeatedly made from this side, that what we are doing here will preclude us from making arrangements with other countries.


Armand Renaud La Vergne: 
Ian Alistair Mackenzie: Has the minister the import figures for last year?


Henry Herbert Stevens: The imports last year in rice flour and cassava and rice meal were valued at $7,776, of which $4,186, came from the United Kingdom and $1,530 from the United States. The importations of sago and tapioca flour were valued at $22,313, of which $10,550 came from the United Kingdom, $9,300 from the United States and $431 from the Straits Settlements.


Ian Alistair Mackenzie: Has the minister the previous rates?
1356	COMMONS
Imperial Conjerence-Trade Agreements


Henry Herbert Stevens: The previous rates were three-quarters of a cent, one cent and one cent. The rates now are three-quarters of a cent, one and a quarter, and one and a quarter cents.


[Stage Direction]
Item agreed to.
Customs tariff-77. Vanilla beans: margin of preference over intermediate tariff, 10 per cent ad valorem.
Ian Alistair Mackenzie: May I have the same information with regard to this item?


Henry Herbert Stevens: The imports under the old item were $74,000, of which $1,000 came from the United Kingdom, $62,000 from the United States, and $8,000 from France. Vanilla beans are a British Empire product and are not produced in the United States at all, but it just happens that we have been buying them largely through the United States.


[Stage Direction]
Item agreed to.
Customs tariff-87n. Tomatoes: margin of preference over intermediate tariff, 2 cents per pound throughout the year.
Item agreed to.
Customs tariff-143. Cigars: margin of preference over intermediate tariff, 50 cents a pound.
Item agreed to.
Customs tariff-ex 254. Gums, viz.: Arabic, copal, damar, gum chicle or sappato gum, crude: margin of preference over intermediate tariff, 10 per cent ad valorem.
Item agreed to.
Customs tariff-264. Essential oils, n.o.p., including bay oil, otto of limes and peppermint oil: margin of preference over intermediate tariff, 7J per cent ad valorem.
Item agreed to.
Customs tariff-267b. as revised. Crude petroleum not in its natural state '7250 specific gravity or heavier at 60 degrees temperature when imported by oil refiners to be refined in their own factories: margin of preference over intermediate tariff, one cent per gallon.
Charles Edward Bothwell: Is not this a combination of two items in the old tariff, 267b and 272b?


Henry Herbert Stevens: My hon. friend is just about right in that observation.


Charles Edward Bothwell: Would the minister state the reason for combining these two items?


Henry Herbert Stevens: There is a considerable production of this class of oil in Trinidad, and this item has been framed to give Trinidad a chance in the Canadian market.


Charles Edward Bothwell: What were the importations from the different countries under these two items?


Henry Herbert Stevens: It is impossible to segregate them because the figures we have cover the importations under a number of different items.


Charles Edward Bothwell: Surely the importations should be segregated, because they come in under different rates of duty. Under one item the product comes in free, and under the other item it comes in at three-tenths of a cent, four-tenths of a cent, and half a cent a gallon. We should have the figures under 267B.


Henry Herbert Stevens: I will do the best I can, but I cannot precisely meet my hon. friend's request. The imports under the existing item have not been heavy, having amounted in 1932 to $96,000, of which $53,000 came from Peru and $42,000 from the United States. The other item to which my hon. friend refers expired in July 1931.


Charles A. Stewart: "Crude petroleum not in its natural state" seems a rather curious definition. It must be partly refined, I should think, because our duty on crude is very low, and the margin of preference granted here over the intermediate is one cent per gallon.


Henry Herbert Stevens: It is the same description as appears in the tariff so far as the words "crude petroleum not in its natural state" are concerned. Some describe it as skinned. It has been put through some slight process.


Ian Alistair Mackenzie: Does the minister think that one cent per gallon is enough protection to meet the competition from Soviet Russia?


Henry Herbert Stevens: This is what they asked for.


James Layton Ralston: I notice that at the top of the column it says "margin of preference over intermediate tariff" and under item 267b in the present tariff this crude petroleum comes in under four-tenths of a cent intermediate. A margin of preference of one cent per gallon would mean a reduction below that, would it not?


Henry Herbert Stevens: This is simply meant to give a preference of one cent a gallon. If my hon. friend will look at the statutory provision in the votes and proceedings he will find there that the rate is a half a cent, and then a cent and a half.


James Layton Ralston: Under 267B?

United Kingdom


Henry Herbert Stevens: Yes. It carries out the understanding set forth in schedule F.


Charles Edward Bothwell: Is this particular item aimed at Russian and Roumanian oil which has been imported into this country?


Henry Herbert Stevens: It is not aimed at anything except to give Trinidad access to our market, and this is the manner in which they have asked that it should be done.


[Stage Direction]
Item agreed to.
Customs tariff-277. Palm and palm kernel oil, unbleached or bleached, non-edible; shea butter: margin of preference over intermediate tariff, 10 per cent ad valorem.
Item agreed to.
Customs tariff-278.	Oils, viz.: cocoanut,
palm and palm kernel, not edible, for manufacturing soap; carbolic or heavy oil; olive oil for manufacturing soap or tobacco, or for canning fish: margin of preference over intermediate tariff, 10 per cent ad valorem.
Item agreed to.
Customs tariff-584. Asphalt or asphaltum, solid: margin of preference over intermediate tariff, 10 per cent ad valorem.
Charles A. Stewart: What are
the imports of asphalt? This is for Trinidad, of course?


Henry Herbert Stevens: The total imports last
year were $480,000.


Charles A. Stewart: There is no considerable quantity coming in from any other source but Trinidad?


Henry Herbert Stevens: A good deal of that is coming in through United States ports. Now it will come direct. That is really the object.


[Stage Direction]
Item agreed to.
Customs tariff-616. Gutta percha: margin of preference over intermediate tariff, 10 per cent ad valorem.
Item agreed to.
Customs tariff-616a.	Balata, crude, unmanufactured: margin of preference over intermediate tariff, 10 per cent ad valorem.
Item agreed to.
Customs tariff-785. Cocoanut oil, not edible, when imported for use in the manufacture of refined cocoanut oil: margin of preference over intermediate tariff, 10 per cent ad valorem.
Charles A. Stewart: Does cocoa-nut oil come to Canada from other sources than the colonies? Is this merely a matter of revenue?


Henry Herbert Stevens: This is an item which was requested by the British particularly on behalf of the colonies. Formerly the rates were free across the board. Cocoanut oil is produced very largely in the different colonies, and it is a product in which they feel they can do a very large business.


Ian Alistair Mackenzie: Is there any competition in this article from extraempire territories?


Henry Herbert Stevens: Yes, the United States imports a lot of oil from various places, part of which filters into Canada from United States noints.


Charles A. Stewart: Unless it be for revenue purposes, I cannot see why a duty was placed on it at all.


Edgar Nelson Rhodes: As a matter of fact this item has been passed already in schedule E.


Charles A. Stewart: I did not
catch the significance of it when it was discussed in schedule E, but if it is going to come from empire countries-and I believe there is no hope of producing it in Canada-I cannot see why there should be a duty at all. This commodity is growing in use. Unless the minister desires revenue I can see no reason why it should not be free.


Edgar Nelson Rhodes: It is free from the empire, but there is a ten per cent duty in the general and intermediate rates.


[Stage Direction]
Item agreed to.
Article 19 agreed to.
Henry Herbert Stevens: Mr. Chairman, I believe item 106b of schedule E has yet to be passed. It appears below schedule F.
Customs tariff-106b. Fruits, prepared, pineapples: British preferential rate to be reduced to one cent per pound, subject to the agreement of His Majesty's government in the Commonwealth of Australia.


James Layton Ralston: What is meant by the expression " subject to the agreement of His Majesty's government in the Commonwealth of Australia "? Is there some provision in the agreement in regard to pineapples?


Henry Herbert Stevens: Yes; the arrangements in connection with this item were not quite concluded at the close of the conference. The Australian representatives were to agree, or otherwise, to it. Since the close of the conference they have agreed, and we are now giving effect to it.


James Layton Ralston: Do they get the British preferential rate?


Henry Herbert Stevens: Yes.


[Stage Direction]
Item agreed to.
1358	COMMONS
Imperial Conference-Trade Agreements
On article 9:
His Majesty's government in Canada will invite parliament to pass the legislation necessary to substitute for the duties of customs now leviable on the goods specified in schedule E the duties shown in that schedule, provided that nothing in this article shall preclude His Majesty's government in Canada from reducing the duties specified in the said schedule so long as the margin of British preference shown in that schedule is preserved or from increasing the rates under the intermediate or general tariff set out in the said schedule.
Ian Alistair Mackenzie: I understood the Minister of Finance to say he had two or three amendments to move.


Edgar Nelson Rhodes: It is not necessary to move them until we reach committee of ways and means.
Article 9 agreed to.
On article 10:
His Majesty's government in Canada undertake that protection by tariffs shall be afforded against United Kingdom products only to those industries which are reasonably assured of sound opportunities for success.


Ian Alistair Mackenzie: I should like either the Minister of Finance or the Minister of Trade and Commerce to explain to the committee the significance of the following phrase:
Only to those industries which are reasonably assured of sound opportunities for success.
What will be the guiding maxim for determining the opportunities for success or prospects of success in each case?


Henry Herbert Stevens: This afternoon a discussion which took place on one of the items was very much along the same line. I read to the committee part of the Tariff Board Act indicating the principle upon which the tariff board would proceed. This is simply an assurance to the British government that in arriving at the tariffs to be imposed in this country protection shall not be put into effect beyond the point indicated herein, namely, that point where the industry has a reasonable opportunity of success. The language in the article is as clear as it could be made.
Article 10 agreed to.
On article 11:
His Majesty's government in Canada undertake that during the currency of this agreement the tariff shall be based on the principle that protective duties shall not exceed such a level as will give United Kingdom producers full opportunity of reasonable competition on the basis of the relative cost of economical and efficient production, provided that in the application of such principle special consideration shall be given to the ease of industries not fully established.


Ian Alistair Mackenzie: In connection. with article 11 I should like to have a declaration of policy from one of the ministers in regard to the significance of the following proviso:
. . . provided that in the application of such principle special consideration shall be given to the case of industries not fully established.
And in regard to the preceding expression:
. . . full opportunity of reasonable competition on the basis of the relative cost of economical and efficient production.
As was pointed out by the hon. member for Ontario and other hon. members at an earlier stage in the debate, this is an antiquated provision which has been in the United States tariff for years. I should like to refer to an analysis of this provision which appears in the Ottawa supplement of The Economist for Saturday, October 22, 1932. Article 11 is quoted, and then the following comment appears:
This statement of principle, which is, of course, by no means new, looks at first sight to be very fair and just. But, on further examination, it will be found to be not only misleading but vicious; for while it appears to be a limiting principle, it is not a limitation either in theory or in practice; for if carried out strictly it would put an end to all foreign trade. Clearly, if a duty is put on equal to this difference, there will be no benefit from foreign trade, which is only advantageous because you can buy abroad cheaper than you can produce at home, and vice versa as regards exports. Practice confirms this theoretical conclusion. The doctrine was embodied by congress in the American Tariff Acts many years ago as an instruction to the American Tariff Commission. One of the earliest members of that commission, charged with the duty of carrying out this policy, wrote a book on "Making the Tariff in the United States" in which he pointed out the practical difficulty of carrying out this doctrine. Here are some of his conclusions: 

"The application of the difference between costs as a measure of duties is usually impossible owing to the difficulty of finding what the difference amounts to. Even if cost data were reliable the fact would remain that there is in every country more than one cost at which any commodity is produced in commercial quantities. The difficulties in obtaining and verifying costs of production are infinitely greater in foreign countries than they are in the United States. The conclusion cannot be escaped that it is rarely possible to ascertain accurately the difference in cost of production at home and abroad. To use as the basis of a general tariff act a thing so fleeting, evasive, and shadowy would be neither right nor possible."
The result was precisely what might have been expected, for, under the operation of this famous clause, practically every change has been upward; the only exceptions being of such small importance as to be derisory. The principle

United. Kingdom
has for many years past been used as a justification for the highest tariffs in the world. When the French delegates attempted to introduce it at the World conference of 1927 as a basis for rationalizing tariffs, it was rejected out of hand.
In practice no country has ever been able to carry out this so-called "scientific principle" in tariff making, but has used its discretion as to the extent to Which it will allow goods to come in subject to the penalty of a protective duty, and how far it will go towards excluding them altogether.


Armand Renaud La Vergne: The hon. member is out of order.


Ian Alistair Mackenzie: From
your point of view, Mr. Chairman, it may be out of order, but from our point of view these comments are relevant to the article under consideration.


Edward James Young: It is instructive.


Ian Alistair Mackenzie: The
article in The Economist is instructive; it is logical, it is rational, it is moderate in tone. It points out that this antiquated provision embodied in the tariff structure of the United States is condemned by those who are most familiar with its terms and provisions. The article which I have read goes on to say that it is entirely impossible as a matter of determination of the principle of a scientific tariff to operate as provided in this clause. I should like to ask either the Minister of Finance or the Minister of Trade and Commerce if they will be good enough in the first place to explain to the committee their conception of the significance of this provision, and in the second place to give their view as to the possibility of working it out in practice.


Henry Herbert Stevens: I think I can answer my hon. friend very clearly. I will give him an illustration that we have just dealt with in this schedule, namely, the linen industry. It was concluded that the linen industry, as regards all branches except the one we mentioned a short time ago, the production of crash towels and so on, was one which, while there were two or three factories struggling along, was not likely to become established in Canada. So we put linen on the free list and abandoned the attempt to establish that industry. There is an illustration of our interpretation of that very principle.


James Layton Ralston: But my hon. friend is dealing with the other section. The section
to which my hon. friend from Vancouver Centre has referred contains another principle altogether.


Henry Herbert Stevens: I am quite aware of what he referred to.


James Layton Ralston: My hon. friend did not answer the question. The hon. member for Vancouver Centre was pointing out that it was difficult to find out what the cost of production was in other countries, and he was asking how the government proposed to ascertain what the relative cost of economical and efficient production was in England as compared with Canada.


Henry Herbert Stevens: I think the hon. member for Vancouver Centre and I understand each other quite well. My hon. friend asked me how I would explain the phrase:
. . . provided that in the application of such principle special consideration shall be given to the case of industries not fully established.


Ian Alistair Mackenzie: That was the first point.


Henry Herbert Stevens: The answer is that we
found no difficulty in deciding that a given industry which had been trying to establish itself here for some time had not succeeded in doing so, and in the schedules passed tonight we dealt with it by placing it on the free list. That is an illustration of how the government views the application of that principle. My hon. friend referred to economical and efficient production. I have already intimated that in the Tariff Board Act we have set forth the principles there applicable; before my hon. friend came in I had read the relevant provision from the act. Certain, principles set forth for the guidance of the board covering labour conditions, cost of material, inquiry into the efficiency of management, and so on, and these will be the guiding principles by which we shall determine what is an economically and efficiently managed industry.


James Layton Ralston: My hon. friend, I am afraid, has just reversed the real situation as it appears in this section. The proviso at the end of the section is that even though the cost of economical and efficient production is greater in Canada than in England, the government reserves to itself the right to continue the protection given to the industries concerned. My hon. friend gives the example of an industry not fully established, and
Questions

points out that in such a case the duty was taken off. We are more interested in the industries to which special consideration is being given because of the fact that they are not fully established. How does my hon. friend propose to find out whether an industry qualifies under this proviso?


Henry Herbert Stevens: I have already intimated that the test will be applied by the tariff board under the principles clearly set forth in the Tariff Board Act.


[Stage Direction]
Item agreed to.
Progress reported.
At eleven o'clock the house adjourned without question put, pursuant to standing order.
Monday, November 21, 1932