SUPPLEMENTARY ESTIMATES

[Stage Direction]
A message from His Excellency the Governor General transmitting further supplementary estimates for the financial year ending March 31, 1933, was presented by Hon. E. N. Rhodes (Minister of Finance), read by Mr. Speaker to the house, and referred to committee of supply.

Hon. HUGH GUTHRIE (Minister of Justice) :: I beg to lay on the table a copy of the order in council together with the report and evidence taken relating to the removal of ex-Judge L. H. Martell of the county court of Nova Scotia.



QUESTIONS

[Stage Direction]
(Questions answered orally are indicated by an asterisk).

Mr. JEAN:: 1.	Is it true that the Canadian Pacific Railway Company has closed its shops, particularly the Angus shops at Montreal, for an indefinite period?
2.	Has the government made proposals to the Canadian Pacific Railway Company that would enable said company to keep its shops open during the winter of 1931-32?
3.	If so, when were these proposals made, what outlay is involved and upon what conditions were the proposals made?
4.	Did the government make similar advances to the Canadian National Railways?
5.	If so, what outlay is involved?
6.	Does the government intend to advance funds to the Canadian Pacific Railway Company in order to induce said company to keep its shops open during the winter of 1932-33?


Mr. BENNETT:: This question was
answered by the order in council which was laid upon the table by the Minister of Labour in so far as it affects last year. So far as the intentions of the government are concerned they will be made known when action is taken. It is not usual to ask for an expression as to the intentions of the government on questions of this kind.


Mr. LAPOINTE:: What about part 4 of the question, reading, "Did the government make similar advances to the Canadian National Railway?"


Richard Bedford Bennett: I thank my hon. friend for bringing that to my attention. Yes, the government did make similar advances.


RESIGNATION OF POSTMASTERS
Mr. POULIOT:: 1.	Since August 1, 1930, have any postmasters resigned after receiving a circular from the Post Office Department?
2.	If so:	(a) to how many postmasters in
each province were circulars forwarded; (b) how many postmasters resigned in each province after receiving these circulars; (c) what are the names and respective addresses of those who resigned in the province of Quebec, and the date of resignation of each postmaster?


Richard Bedford Bennett: Surely that question cannot be in order, Mr. Speaker. It reads: "Since August 1, 1930, have any postmasters resigned after receiving a circular from the Post Office Department?" Circulars are sent every second week, I should think, on the average, at any rate. There must be some particularization of what is meant because as the question reads any man who resigned [DOT]after receipt of any circular would come within the terms of the question.

Questions


Mr. POULIOT:: In answer to my right hon. friend, formal circulars were sent to the postmasters advising them to resign in order to save the expenses of an investigation. Some ignored the -circular and others resigned in consequence of it. This is a matter of great historical interest.


Mr. SPEAKER:: Question stands.


MB. ADHIEN LEC0MPTE
Mr. BARRETTE:: 1.	Is Mr. Adrien Leeompte on the eligible list of letter carriers in Montreal?
2.	If so, what rank does he occupy on the list?
3.	Is he married, and where is his residence located ?
4.	Is Mr. P. C. Tison on the eligible list of letter carriers in Montreal?
5.	If so, what rank does he occupy on the list?
6.	Is he married, and where is his residence located?
7.	Are they both in the employ of the Post -Office Department as letter carriers?
8.	Who recommended Mr. Leeompte, and who recommended Mr. Tison?
9.	Must those who are on the eligible list of letter carriers await their -turn to become letter carriers?
10.	Do heads of families have priority if they occupy the same rank as bachelors?


Mr. SAUVE:: 1.	Yes, and he has also passed the mail porter examination.
2.	286C on the letter carrier list and 173 on the mail porter list.
3.	According to information obtained when he entered the service he is single. He resides at Pont Viau, P.Q.
4.	Yes.
5.	Rank 32.
6.	According to information obtained when he entered the service he is single. The address given is 6027 De la Roche, Montreal.
7.	No. Mr. Tison was released on April 3, 1932.
8.	Both Mr. Leeompte and Mr. Tison were selected from the lists of candidates submitted by the Civil Service Commission.
9.	Yes, unless the candidates whose names appear higher on the list are not available or are unsuitable for the work to be undertaken.
10.	No.


POSTMASTERS-POLITICAL PARTISANSHIP
Jean-François Pouliot: Since the month of August, 1930, in how many cases was a postmaster charged with political partisanship temporarily or permanently replaced by a person who had laid a charge cr given evidence against him?


Mr. SAUVE:: Since the decision of the committee of the house on civil service, none.
Prior to that time, following long established practice, 147.


TEMISCOUATA COUNTY POSTMASTERS-DISMISSALS
Mr. DORION:: 1.	Have all the postmasters in Temiseouata county against whom complaints were lodged with the Post Office Department been dismissed?
2.	If not, why not?


Mr. SAUVE:: 1.	No.
2.	Because the complaints were either of minor importance or were not substantiated by investigation.


Mr. DORION:: How many postmasters in Temiseouata county were dismissed from 1922 to 1930?


Arthur Sauvé: 20.


BEAUHARNOIS, QUE.-POSTMASTERSHIP
Mr. RAYMOND:: 1.	Who appointed J. N. Laberge postmaster of the town of Beauharnois, in a temporary capacity?
2.	Who recommended him?
3.	Is this position within the scope of the Civil Service Commission?
4.	If so: (a) was the Civil Service Commission advised as to the vacancy with respect to this position, and on what date; (b) was the commission asked to fill the vacancy, and on what date; (c) did the commission take the necessary steps to permanently fill the vacancy?
5.	Whom did J. N. Laberge replace?
G. Was the person whom J. N. Laberge replaced as postmaster dismissed?
7.	If so:	(-a) what were the reasons; (b)
who made the request; (c) when was the dismissal requested?


Mr. SAUVE:: 1.	Postmaster General.
2.	J. H. Leboeuf, S. W. LaRoche.
3.	Yes.
4.	(a), (b), and (c), not yet.
5.	Oscar Duquette.
6.	Yes.
7.	(a) Was found guilty of active political partisanship following an investigation; (b) a complaint was received from Mr. Philias Dore accompanied by affidavits from Messrs. Rodrigue Montpetit, J. P. Lanouette and Antonio Laberge; (c) 4th July, 1932.
Questions



ST. JEAN-ST. PAMPI1ILE MAIL CONTRACT

Mr. FAFARD:: 1.	Who secured the contract for carrying the mail between St. Jean, Port Joli and St. Pamphile, in the county of L'Islet, Quebec?
2.	What are the names of those who submitted tenders and the amounts of their respective tenders?


Air. SAUVE:: 1.	Calixte Belanger.
2.	Albert Bourgault, St. Pamphile, $840 per annum; Arthur Anctil, Ste. Perpetue, $850 per annum; Calixte Belanger, St. Pamphile, $1,200 per annum; Georges Emile Duval, Elgin Road, $1,252 per annum; J. Zotique Leclerc, St. Pamphile, $1,350 per annum; Amedee Belanger, Ste. Perpetue, $1,475 per annum; Chrysostome Legros, St. Pamphile, $1,495 per annum; Camille Chouinard, St. Aubert, $1,600 per annum; Jos. Wm. Anetil, Tourviile, $1,800 per annum; Camille Chouinard, Ste. Perpetue, $1,930 per annum; Francois Leclerc, Ste. Louise, $1,989 per annum.



NEW POST OFFICES-QUEBEC PROVINCE

Mr. POULIOT:: 1.	Have any new post offices been established in the province of Quebec since the month of August, 1930?
2.	If so: (a) what are the names of these post offices; (b) in what county is each located?


Mr. SAUVE:: 1.	Yes.
2.	(a) and (b).
Name of Post Office-Electoral District
Lac des Sept Isles, Portneuf.
Route du Sault, Temiscouata.
Salmon Bay (summer office), Charlevoix-Saguenay.
Gatico, Champlain.
Nigger Rapids, Wright.
Rapide Blanc, Portneuf.
Anse Ste. Anne des Monts, Gaspe.
Siscoe, Pontiac.
Dalesville, Argenteuil.
Lourdes de Joliette, Joliette.
Montreal Sub office No. 80, St. Mary.
Montreal Sub office No. 76, Maisonneuve.
Montreal Sub office No. 87, Laurier-Outre-mont.
Perthuis, Portneuf.
Grandbois, Temiscouata.
Grand Detour, Matane.
Maria Ouest, Bonaventure.
Village des Hurons, Quebec-Montmorency.
Cap Chat Est, Gaspe.
La Montagne, Megantic.

L'Anse Mclnnes, Bonaventure.
Norbestos, Drummond-Arthabaska. Ruisseau Plat, Berthier-Maskinonge.
St. Ulric Est, Matane.
Girardville Centre, Lake St. John.
Thetford Mines Sub office No. 1, Megantic-Lebrun, Berthier-Maskinonge.
Low, Wright.
Montreal Sub office No. 4, Cartier.
St. Stanislas, Lake St. John.
Anse des Mechins, Matane.
Bois Brule, Gaspe.
Riviere Plate, Temiscouata.
St. Maurice de Dalquier, Pontiac.
Village Villeneuve, Lake St. John.
Gagnon, Dorchester.
Montreal Sub office No. 91, St. Denis. Kanasuta, Pontiac.
Biencourt, Temiscouata.
Montreal Sub office No. 110, Maisonneuve. St. Jean Sub office No. 2, St. Johns-Iberville. Windigo, Portneuf.
Pibrac, Chicoutimi.
Pincourt, Vaudreuil-Soulanges.
Auclair, Temiscouata.
Canton Tessier, Matane.
St. Simeon Ouest, Bonaventure.
Flynn, Gaspe.
Kelly-Newton (summer office), Wright. Montreal Sub office No. 13, St. James. Riordon Depot, Pontiac.
Bois des Filion, Terrebonne.
La Corniche (summer office), L'Assomption-Montcalm.
Montreal Sub office No. 19, St. Mary. Montreal Sub office No. 90, St. Lawrence-St. George.
Petit Lac Long, Terrebonne.
Wychwood (summer office), Wright.
Lac des Aigles, Temiscouata.
Milot, Lake St. John.
Montreal Sub office No. 52, Mount Royal. Montreal Sub office No. 88, Mount Royal. Orelda Camp (summer office), Berthier-Maskinonge.
St. Achille, Lake St. John.
St. Antoine du Lac St. Jean, Lake St. John. Ste. Claire d'Assise, Vaudreuil-Soulanges.



PIED-DU-LAC, QUE., POST OFFICE

Mr. POULIOT:: 1.	Has the location of the post office at Pied-du-Lac, in the county of Temiscouata, been changed ?
2.	If so: (a) what is the distance between the former location and the new one; (b) were any complaints made with respect to the former location?

Questions


Mr. SAUVE:: 1.	Yes-on account of the dismissal of the postmaster for political partisanship.
2.	(a) No information; (b) No.



CANDIDATES FOR POSTMASTERSHIPS

Mr. POULIOT:: 1.	Since the month of August, 1930, was the chief inspector of the Post Office Department instructed to verify the qualifications^ of candidates for the position of postmaster ? '
2.	If so, what are the names and addresses of candidates whose qualifications he was instructed to examine, and on what date did he submit a report in each case?


Mr. SAUVE:: 1.	Yes.
2.	Isidore Jean, Sully, report July 22, 1932; L. A. Champagne, Acton Vale, report July 28, 1932.



* GOVERN MENT BORROWINGS

Mr. SPENCER:: 1.	Has the government of Canada recently borrowed 35 million dollars from the banks at 4 per cent for a term of two years?
2.	To what extent did the banks borrow under the Finance Act from the government in the year ending September 30, 1932?
3. What rate of interest was charged the banks by the government for the amount borrowed, referred to in question No. 2?


Richard Bedford Bennett: I will read the answer to that question.
Some of the reactions to the report that the government had arranged a sale to the banks of $35,000,000 in two-year notes which the banks would use as security for borrowing under the Finance Act appear to indicate some misunderstanding of the situation. So far as I am aware the best and most conservative opinion throughout the world is committed to the idea that an easing of money and credit is highly desirable in the interests of business recovery. Such is certainly the case in Great Britain and in the United States.
The credit situation in Great Britain has been materially improved. In the United States a recent enactment gives power to the National banks to create new note issues aggregating nearly $1,000,000,000 against the security of certain classes of government bonds, and this measure supplemented a central bank policy of easing money, which resulted in bringing the government bond holdings of the Federal Reserve system to a figure in excess of $1,800,000,000.
While it may be said that the positive benefits of such actions have still to be achieved there is no question that they have prevented the situation from becoming decidedly worse. In such matters no one can afford to disregard the judgment of the two leading financial countries of the world, although in our case it has to be interpreted in the light of our own situation which differs materially from that of Great Britain on the one hand and of the United States on the other.
In the case of Canada the only machinery available for action along these lines is found in the Finance Act. In the recent transaction the banks purchased two year notes -of the Dominion of Canada, bearing interest at the rate of 4 per cent, and these notes the banks will use as security in obtaining an advance of an equivalent amount under the Finance Act, thereby swelling their cash reserves and substantially increasing their loaning capacity. This procedure differs in technique, but not in fact, from normal central bank policies followed in various other countries.
Because of our sound banking situation a Canadian policy of this type can and must be of a much more restricted character both relatively and absolutely than the examples to which I have referred. In fact, advances under the Finance Act are today at a very low level. At the close of business on November 7 such advances amounted to only $28,344,000 and when full advantage is taken of the recent arrangement the total will only slightly exceed $40,000,000.
Reference to the monthly return of the chartered banks will show that each autumn in recent years operations under the Finance Act have assumed important proportions. Thus, at the end of November, 1931, they totalled $66,500,000, while on the same date in 1930 the figure was $38,700,000 and in 1929 SI 12,900.000. Not only are advances under the Finance Act at a low level but our gold holdings are larger than a year ago. Today our gold holdings represent 44-5 per cent of the-total dominion note circulation as compared with 43-1 per cent on the same date last year.
Out of the proceeds of the $35,000,000 loan, $12,000,000 was used immediately to retire a short term debt. The balance was used to supplement the Receiver General banking accounts which each year on November 1 must be adequate not -only to provide for the ordinary operations of the various branches of the public service, but also to pay approximately $30,000,000 of interest on our national debt.. Once the present 4 per cent loan operation is completed, the dominion is finished with the market for some time to come. There are no more temporary loans to redeem, and the next maturity is in August, 1933.
After having proved our ability to ride out the storm, I feel that we were justified-to the-
*928
Questions

very limited degree necessary in our case- in joining other countries in the adoption of monetary measures designed to encourage recovery. However, any broad action along this line is unnecessary and, as I have stated frequently on previous occasions, this country will not depart from the established principles of sound money.
I may point out that if easier credit conditions mean anything, they mean improvement in the market for gilt edge bonds. The present opportunity to purchase dominion government bonds on a 4J per cent basis may not again present itself for a long time to come.


Mr. MACKENZIE (Vancouver):: Might I
ask the Prime Minister to supplement his answer? Last April he stated that there was a total issue of $71,000,000 of dominion notes without gold coverage. Do I understand that this $35,000,000 is added to that $71,000,000?


Richard Bedford Bennett: That is hardly a correct statement of what I read. I read from the Gazette indicating that by statute certain issues had been validated, those connected with the advances made to the Canadian Northern railway and the Grand Trunk railway system. What I said then applies equally to what I say now, that is, they are specially dealt with in the return which I trust the hon. gentleman has observed, and if he will look at it he will see that there is no change in that regard.


Mr. SPENCER:: With regard to the second part of the question, is the government charging the banks three per cent against the amounts they are getting under the Finance Act?


Richard Bedford Bennett: The usual practice has been that the spread between the charge made by the banks and the charge made against the banks is one per cent; that prevails in this case.



SEIZURE OF AUTOMOBILE

Mr. POULIOT:: 1.	Was an automobile belonging to Camille Berberi of Laurierville, seized during the month of September, 1932, while carrying smuggled cigarettea?
2.	If so, was this automobile sold in accordance with the act?
3.	If not, why?
4.	What became of said automobile?
5.	Did the said Camille Berberi appeal to the government through counsel?
6.	If so, who was the counsel?


Mr. RYCKMAN:: 1. Car seized from Michael Barbarie, Laurierville, Que., in September, 1932, for having been used in transporting smuggled cigarettes.
{Mr. Bennett.]
2, 3 and 4. Car was not sold but released, pending decision, on deposit $100, which was considered a sufficient penalty.
5.	Michael Barbarie appealed through counsel after car was released.
6.	Dorion & Dorion.
Note.-Michael Barbarie is being prosecuted under Section 217 (2) of the Customs Act.
*	SPEEDBOAT O'CONNELL


Mr. POULIOT:: 1.	Was the speedboat O'Connell (No. 4) seized in the spring of 1930?
2.	If so, why, when and where?
3.	Was it sold by auction after public notice according to the law?
4.	If not, why?
5.	Wras it sold by private sale to Dr. Paul Gilbert of Charny?
6.	If so:	(a) why, when and where; (b)
was it on the recommendation of a lawyer, barrister, attorney or solicitor; (c) if so, who was he; (d) what was the sale price of that boat and when and where was it paid; (f) what was the value of said speedboat in 1930?
7.	Was that speedboat O'Connell (No. 4) seized in., the fall of the same year and destroyed by the Quebec Liquor Commission?


Mr. RYCKMAN:: 1.	Yes.
2.	Near Portneuf, Que., August 21, 1930, for having been used in smuggling liquor into Canada.
3.	*It was sold in accordance with the law, but not by public auction.
4.	Offer received for full amount of appraised value.
5.	Yes.
6.	(a) Because offer received of full
appraised value, September 25,	1930, at
Quebec; (ib) No, but offer received through solicitor for purchaser; (c) Frederic Dorion was the solicitor; (d) $800, September 25, 1930, Ottawa; Of) $800.
7.	No information before the department.



UNEMPLOYMENT RELIEF

[Stage Direction]
On the orders of the day:
Ian Alistair Mackenzie: Mr. Speaker, I should like to ask the minister if before the house rises he will make a statement regarding the unemployment policy of the government.


Hon. W. A. GORDON (Minister of Labour) :: Y'es, I hope to make such a statement.



SECOND NARROWS BRIDGE

[Stage Direction]
On the orders of the day:
Mr. H. J. BARBER (Fraser Valley):: Mr. Speaker, I should like to ask the Prime Minis-

Second Narrows Bridge
ter a question concerning a matter which has been before the government 'for some time. What action, if any, has the government decided to take in restoring the span of the Second Narrows bridge?


Richard Bedford Bennett: Mr. Speaker, it will be within the memory of hon. members that the Second Narrows bridge, so-called, in the harbour of Vancouver was practically destroyed by the centre span falling into the river in consequence of an accident. The decision of the court of last resort involved certain liability against the bridge company. The bridge company however received from this parliament last year an extension of its charter and subsequently went into liquidation, a receiver being appointed, the operations of the company from that time forward being directed by the courts.
A contract was let for the construction of a new superstructure, also for the construction of a lift span, that being the type of span recommended by Sir Alexander Gibb as the one best fitted to meet the difficulties of navigation at that point. Difficulties however were experienced in connection with financing and finally, with the acquiescence of the government, the bridge is being turned over to the harbour commissioners for the purpose of enabling them to do what may be necessary to render suitable accommodation, and to allow them to erect a suitable structure so that navigation may not be interfered with. That will be done under the direction of the court. Tnder the liquidation, the court being asked to approve, of course, every possible step is being taken to bring about the construction of the bridge. Negotiations are not completed, but they are proceeding along those lines.
I may say to hon. members that the bridge in question is a toll bridge, located in the very centre of Vancouver harbour. The harbour commissioners of that city will be charged with the responsibility of operating and maintaining the bridge, under a deed of trust which will ensure its return to those who originally owned it, namely the municipalities at either side of the narrows, when the obligations have been discharged to -the harbour commissioners and to the municipalities that advanced $630,000. That is a general outline of what is being done. Details have not been settled, however, and negotiations are being completed. The law officers of the
crown are supervising, on behalf of the harbour commissioners, what has been agreed upon, to see that it is put into proper legal form, and that the courts of the province under whose direction the receiver acts give proper directions in the premises.


Ernest Lapointe: Mr. Speaker, in connection with the statement made by the Prime Minister concerning the reconstruction of (he Second Narrows bridge, which is being done under the direction of the harbour commissioners of Vancouver, may I ask whether advances will be made by the government to the harbour commissioners for that purpose?


Richard Bedford Bennett: The city of Vancouver sent a telegram to the government indicating that they would take $300,000 worth of the security. The harbour commissioners of Vancouver have a very substantial reserve, and so far as we are advised at the present time they will be able to finance the undertaking.


Ernest Lapointe: Has not the government changed or altered its policy as expressed one or two years ago, namely, that it would not contribute anything to the erection of toll bridges ?


Richard Bedford Bennett: No; the conveyance of the undertaking is being made to the harbour commissioners; they will be the proprietors of the property in trust, until such time as the obligations of the bridge company have been discharged.



QUESTION ON ORDER PAPER

[Stage Direction]
On the orders of the day:
Jean-François Pouliot: Mr. Speaker, if I read correctly the calendar before me today is November 8, and I call attention to the fact that the first question appearing on the order paper bears date of October 13. For many weeks this has been the first question, and therefore I suggest that it may be termed the leading question. As it is a leading question the Postmaster General could have no excuse for refraining to answer it.


Arthur Sauvé: Mr. Speaker, my officers have had to
examine about 12,000 files, and they are still working on the question raised. I assure the hon. member that he will have an answer soon, possibly tomorrow.



Australian Trade Agreement



AUSTRALIAN TRADE AGREEMENT


[Stage Direction]
On the orders of the day:
Hon. H. H. STEVENS (Minister of Trade and Commerce):: 

CANADA GRAIN ACT


[Stage Direction]
On the orders of the day:
Mr. J. L. BROWN (Lisgar):: Mr. Speaker, now that the minister has answered one question, I should like to ask another based upon a telegram which came into my hands today. No doubt this question should have been asked yesterday wheni we were discussing the amendment to the Grain Act. The question did not suggest itself however until I received the telegram. I would ask: Is the amendment designed to relieve the government of the burden of the storage on account of Mr. McFarland's holding of wheat pool wheat?


Henry Herbert Stevens: The answer is definitely no, ind I think I made that clear yesterday. The suggested amendment to the Grain Act arose entirely out of a desire on my part, as I said yesterday, to lessen the burden of charges upon the movement of grain.
[ Mr. SauveJ


John Livingstone Brown: It means, of course, that
those who hold wheat in elevators will be benefited at the expense of the elevator owners.


Henry Herbert Stevens: My hon. friend may put
his own construction upon it.



RADIO BROADCASTING


[Stage Direction]
On the orders of the day:
Mr. PAUL MERCIER (St. Henri):: Mr. Speaker, I understand that last year the report of the committee on radio broadcasting was made to the house. Although English copies of that report are obtainable, I have been unable to obtain any French version of it. As this is a very important matter I should like to know whether or not those copies are obtainable?


Richard Bedford Bennett: The copies must have
been exhausted, because it was a sessional paper, printed in both English and French, and a stated number of copies was ordered by the house to be printed. It is possible the copies have been exhausted, but my information is that certainly they were printed.



RAILWAY EMPLOYMENT


[Stage Direction]
On the orders of the day:
Mr. J. P. HOWDEN (St. Boniface):: I would like to direct a question to the attention of the Minister of Railways (Mr. Manicn). He is doubtless quite familiar with this matter, and I think it is of sufficient importance to commend itself to his consideration. I have here a letter from a railway engineman, in the city of Transcona. It is one of a number that have come to me from different individuals; this one however is quite clear and probably presents the matter more tersely than I could myself, so if I am in order I would like to read it.


Pierre Édouard Blondin: It is not well to preface a question by too long a statement. Surely the question can be asked without reading the letter.


John Power Howden: The letter is very brief,
and I do not believe I could explain it in as few words as the letter. The writer says:
' I am writing you in hopes that you might da something to rectify a grave injustice existing, in the running trades of railway labour. I

Lobster Fishery
bring this matter to your attention because a great number of workers in your constituency are affected.
The condition is as fellows: In order that men of much seniority be enabled to work thirty-two to thirty-eight days per month-
Or approximately 3.600 miles, I believe.
-men of less seniority are laid off altogether. Because seniority is wrongfully used when giving anyone more than twenty-six working days per month. A considerable number of men are wrongfully forced into the ranks of the unemployed. In your constituency alone at least 150 men-
I believe there are a great many more than that, Mr. Speaker.
-are unjustly and unnecessarily forced to look for relief for means of sustaining their families and themselves, that is, they become a government problem. Since the government does take some action, why should it not give justice instead of charity, especially when justice is less costly. Subsidizing a victim does not remedy an injustice.
Well, Mr. Speaker, I will not read the rest of the letter, that explains itself so far.


An hon. MEMBER:: What did he say about Murdock?


John Power Howden: The question I would like to address to the Minister of Railways is: Is he or the government competent to move in this matter, and if so would they not make a more even distribution of this work in order to afford a degree of relief to a number of families who are in distress, and thereby also save considerable funds applicable to direct federal relief?
Hon. R. J. MANiION (Minister of Railways and Canals): The question the hon. member has brought up is a very complicated one. I presume most members of this house, those who come from railway centres at any rate, have received many such letters as the one the hon. gentleman has read-


An hon. MEMBER:: Hundreds of them.


Mr. M ANION:: -and also others from the other side, that is, from the senior railway-men. The fact is that the government has no power whatever in this matter unless the government, or some government, chose to overrule the agreements between the men's unions and the railway companies, for it affects both railway companies alike. I may say that I have asked the railway companies for their side of the question, and quite frankly both railways, the Canadian Pacific and the Canadian National, take the position that they have agreements with the men's unions and that they do not care to interfere with those 53719-59J
agreements. The senior men who are getting what the other men claim to be excess mileage take the position that these agreements stand, and they object to any interference with them. It is a matter wholly between the two railway companies and the unions as representing the men.
Of course, men who are out of employment, the junior men, those who as the railwaymen express it are "bumped off,"-I think that is quite the proper railway expression,-by the senior men, naturally protest. The senior men on the other hand take the attitude that they have rights, to make up to, say, 4,800 miles on a passenger train and 4,000 on a freight train. And they have a further argument which complicates the matter, namely that their pension is based upon the earnings of the last ten years of their service, and if they should give up some of their time it cuts down their pension. Incidentally many of the men's unions take the attitude, and I think truthfully, that they have already given up a certain mileage to the men who are not employed, and thereby have spread the work.
' Without being too verbose I have tried to show some of the difficulties of the situation. I repeat that the government has no power to interfere, it is a matter between the railway companies and the men themselves, and while the government has passed on these representations to the railway companies, the companies have so far taken the attitude that they will not or cannot move in the matter.



LOBSTER FISHERY

[Stage Direction]
On the orders of the day:
Mr. A. E. MaoLEAN (Prince): Mr. Speaker, on October 26 I asked a question of the hon acting Minister of Fisheries (Mr. Rhodes) regarding trouble between the patrol boat and the fishermen, and the fact that some of the fishermen had been fired upon by the patrol boat. I would like to ask the minister if he could give a statement on that.
Hon. E. N. RHODES (Acting Minister of Fisheries):: I have a report from the chief
supervisor of fisheries for the maritime provinces. His report to me is that the first occasion upon which traps were destroyed was on the 24th of October. It will be borne in mind that the lobster season closed in that area on the 15th. Upon that occasion 112 traps were examined and 95 lobsters were liberated. These traps had been freshly baited, and naturally, following the law in the circumstances, had to be destroyed.
Portsmouth Penitentiary



FARM RELIEF-SASKATCHEWAN

[Stage Direction]
On the orders of the day:
Wesley Ashton Gordon: On October 27 last, Mr. Speaker, the hon. member for Willow Bunch (Mr. Donnelly) asked a question which appears at page 601 of Hansard. The question was as follows:
Mr. Speaker, I should like to ask the Prime Minister or the Minister of Labour if the legislature of the province of Saskatchewan have approached the Dominion government asking for assistance in caring for the destitute farmers in the dried-out areas of Saskatchewan. If so, what arrangement has been arrived at?
I made inquiries from the officers of the Department of Labour and found that no request such as that suggested was made either by the provincial government or by any member thereof. I made further inquiries in the Department of Agriculture, and found that there was said to have been some discussion between the premier of Saskatchewan, I think, and the officers of that department with regard to the probable attitude of this government in case the farmers in those parts of Saskatchewan again suffered a complete crop failure. Nothing, however, has come formally before the Department of Labour.



PORTSMOUTH PENITENTIARY- WARDEN

[Stage Direction]
On the orders of the day:
Mr. THOMAS REID (New Westminster):: I should like to direct a question to the Minister of Justice (Mr. Guthrie). I understand that applications are being received for the position of superintendent or head warden of Portsmouth penitentiary, and that advertisements to this effect are appearing in Ontario papers only. I should like to ask the minister if this is the policy of his department, and whether he would not consider it advisable to call for applications throughout Canada, thus giving men in all parts of the dominion an opportunity to apply for this high position.

Imperial Conjerence-Trade Agreements


Hugh Guthrie: The advertisements in question, calling for applications for the position of warden at Portsmouth penitentiary have appeared, as my hon. friend has stated, with a residential qualification limited to the province of Ontario. It is true that the Penitentiaries Act provides for the appointment of wardens of penitentiaries generally and that when appointed a warden may be placed in charge of any penitentiary as occasion may require, but there is another provision in the Civil Service Act in regard to the locality from which appointments shall be made, and regard must be had under that act to applicants residing in the vicinity of the institution. I am informed that ever since the Civil Service Act came into operation advertisements have taken this form and have been limited to the province or area in which the penitentiary is located. When such an appointment is made the man is appointed as a warden generally for the whole dominion, though in the first instance the applications are limited in respect of residence to the particular penitentiary district.


Ernest Lapointe: Wardens have been transferred from one penitentiary to another.


Hugh Guthrie: Yes, that is the object of the general clause in the act which provides that a man is appointed as a warden generally and can be transferred to any penitentiary as occasion may require.



BRITISH ORDER FOR POULTRY

[Stage Direction]
On the orders of the day:
Mr. THOMAS HAY (Springfield):: I should like to direct a question to the Minister of Trade and Commerce based on an article appearing in the Ottawa Journal this morning. The article is short and I should like to read it to the house. It is headed "Canadian Press by direct wire," and reads as follows:
Regina, November 7.
The United Kingdom government has given the Canadian government an order for one million pounds of poultry to be purchased in the west, according to reliable information received here today. Manitoba is expected to supply the bulk of the shipment since the birds will be shipped from the nearest shipping points. The better part of the order will be made up of turkeys and agents are said already to be in Manitoba cheeking over flocks. It is hoped the order may stabilize the trade in western Canada where it was feared turkeys would be retailing for 12 cents a pound by the Christinas season.
I should like to ask the minister if there is any truth in this despatch.


Henry Herbert Stevens: With regard to the details
of the despatch, I am not familiar with precisely what has happened. I do know that a month or two ago the officers of my department in charge of external trade matters took up with the trade commissioners representing this dominion in the mother country the desirability of pressing Canadian poultry on the British market. We had very encouraging reports, and I presume that the story just read by my hon. friend is in large measure the result of these efforts. Although the matter came to my attention this morning I cannot give any detailed information with regard to this story, though I have every reason to believe that it is substantially correct.



GOVERNMENT WHEAT PURCHASES

[Stage Direction]
On the orders of the day:
Mr. P. F. CASGRAIN (Charlevoix-Sague-nay):: I should like to direct the following
question to the government: Has the government, directly or indirectly, purchased grain in Winnipeg or in any other market? If so, what was the cost of the grain purchased and under what statutory authority were such purchases made?


Richard Bedford Bennett: I think we might treat this question as a notice of motion.



TRADE AGREEMENT BETWEEN CANADA AND THE UNION OF SOUTH AFRICA

[Stage Direction]
The house resumed from Monday, November 7, consideration in committee of Bill No. 3, respecting a certain trade agreement between the Dominion of Canada and the Union of South Africa-Mr. Bennett*-Mr. LaVergne in the chair.
On section 2-Trade agreement approved.
Air. YOUNG:: When this section was under consideration last night I expressed the opinion that subsection 2 of article 1 would have the effect, in certain cases, of raising the duty on goods coming from South Africa by 10 per cent, and of forcing those duties into the general tariff, in other cases, making them much higher than they are at present. The Minister of Trade and Commerce took the view that I was entirely wrong. He said that there was no danger of that; the provisions of the preferential tariff would apply. I see, however, according to Hansard, that the Prime Minister does not seem to have taken that view. When I expressed the opinion I have just stated, he asked, "Who suffers from it?" May
934	COMMONS
Imperial Conference-Trade Agreements
I ask which opinion is correct, the opinion of the Minister of Trade and Commerce or the Prime Minister's. The section of the article referred to is this:
To enjoy the benefit of the tariff advantages provided for in section 1 of this article, goods originating in and coming from the Union of South Africa shall be imported direct into Canada.


Richard Bedford Bennett: I do not think there
is any difference of opinion as between the Minister of Trade and Commerce and myself. I asked the question who suffers, and that has nothing to do with the fact that direct shipment is defined by the Customs Act itself. The Minister of Trade and Commerce referred to the section that defines what constitutes direct shipment. I was not in any sense discussing that. The Minister of Trade and Commerce said that it wras clearly understood beyond peradventure that the transshipment of goods under the circumstances he mentioned constituted direct shipment, and there is no question about it. There is no difference of opinion between us in that regard.


Edward James Young: Let us take this case-


Richard Bedford Bennett: Before the hon. member proceeds, what does he mean? There is no difference of opinion. I asked who suffers, and I want to know who suffers in consequence of what the hon. gentleman said. There was no variance between what I stated in asking that question and what the Minister of Trade and Commerce said.


Edward James Young: I take it that the Prime Minister agrees with the Minister of Trade and Commerce.


Richard Bedford Bennett: Surely.


Edward James Young: Then may I ask this question. Under item 106 we find that apricots, pineapples, cape gooseberries, plums, figs, quinces, papaws are 1 cent per pound; that is the rate. These are not preferential rates. A shipment of these goods cannot come in under the preferential tariff, and the provisions which give the British preferential rates to goods from South Africa will not apply in this case. Suppose we have a shipment of these goods from South Africa through England to Canada. They are transshipped in England. The British preferential tariff cannot apply, nor can any of the provisions thereunder apply to such goods, so that we shall be obliged to fall back on section 2 of article I, which provides that the goods must come directly into Canada. Since they do not come directly into Canada, they will have to pay

the general rate. The importers will appeal to the customs board for a ruling, and the board will say, of course, that they are bound to be governed by subsection 2 of article I of the agreement.


Henry Herbert Stevens: My hon. friend will pardon me if I am unusually blunt in my answer. He will persist in building up imaginary cases. I tried to answer him yesterday as clearly as I could in the English language, and I will try to do so again. As regards goods coming in from South Africa under the British preferential rate, they enjoy all the privileges that accrue to shipments under that rate. Secondly, the term direct shipment to which he has referred in the regulation by the department is a well-recognized, well-established and standardized meaning in this country, accepted and understood by every customs administrator and officer, and it includes, so far as South Africa is concerned, the movement of goods to Canada which may be transshipped from one ship to another at Great Britain en route, provided it is perfectly clear by the documentation of the goods that they are destined for Canada. My hon, friend raises this bogy. He says if these articles- apricots, pineapples, cape gooseberries, plums, figs, quinces and so on-came under the British preferential tariff, they would enjoy certain privileges. But he says they are not coming in under that, so that they will lose those privileges. Let us see what the facts are in regard to these items which the hon. gentleman cites by way of illustration to support his views. Under the British preference these goods would pay 2 cents per pound; under the treaty they pay 1 cent per pound. So that so far as they are concerned they get the advantage under the treaty. As regards direct shipment, they will be treated precisely the same as goods coming under the British preference. I hope I have made that clear.


Mr. MACKENZIE KING:: Is there any
line of steamships running direct from South Africa to Canada, and if so, how often do the vessels run?


Henry Herbert Stevens: There is a monthly
steamship service, and an excellent one, by the Elder Dempster Steamship line. That sendee has been in operation for thirty-two years, subsidized by the Dominion government constantly during that period.


William Lyon Mackenzie King: I ask that
question because I notice that there is a difference in the two clauses of the agreement which relate to the benefits to be given by respective countries under this treaty.



S, 1932

[Stage Direction]
South Africa
As regards South Africa, if they are to get the benefit of the preference on goods shipped into this country, they must come direct. I understand the minister to say, now, that "direct" can be given a broad interpretation, which will serve the same purpose. But when one reads the clause relating to goods going from Canada to South Africa, to enjoy the benefit of the preference in South Africa, the clause distinctly states, they may come direct, or that they may be transshipped, and it does not confine transshipment to transshipment in Great Britain. They may be transshipped at any point. All that is necessary is to satisfy the customs officer that the original intention was to ship the goods from Canada to South Africa. Can my hon. friend explain why there is that difference between the two clauses-why they were not worded in the same way?
Henry Herbert Stevens: The answer is quite simple. In each case, and in all these treaties, South Africa, Australia, New Zealand and so forth, we have always endeavoured to carry into the provision the nomenclature of the laws governing the countiy where the goods enter. That is to say, where we have an established practice in 'Canada we endeavour to word the article in the treaty governing the movement of goods into Canada in accordance with the general practice in this country; and the reverse is the case with respect to the other dominions. In both instances, these articles conform to and harmonize with the established practice in the respective dominions. And may I explain why that is so. It will be readily understood that if we inject into the treaty terminology which will call for a course of action different from the common practice, it involves a certain amount of confusion in administrative circles. In other words, as I said to my hon. friend a moment ago, the tendency is to standardize the laws or regulations which govern the movement of goods. We have been complying with the standardized practice in Canada and at the other end with the standardized practice in South Africa.


William Lyon Mackenzie King: I am afraid that the nomenclature and terminology, so far as Canada is concerned, appears to be of a restrictive character. That is the point to which I wish to call attention. It is another form of restricting rather than of enlarging trade facilities. According to what my hon. friend has just said, the Canadian government apparently requires shipments direct. The other parts of the empire, particularly South Africa, as in this case, do not require direct shipment, but permit transshipment and expressly so deolare. In other words, they are seeking to encourage trade, whereas, by our nomenclature or terminology, we have another device for restricting trade.


Mr. MALCOLM:: Is the minister not simply saying that when an importer brings in goods on a through bill of lading, it makes no difference what route they follow?


Henry Herbert Stevens: That is not precisely correct.


James Malcolm: In the case of goods shipped on a through bill of lading from South Africa to Montreal what difference would it make whether they came via Great Britain or via New York?


Henry Herbert Stevens: There is a very marked distinction. If the goods are shipped from South Africa on a through bill of lading but are transshipped at London to a British, Canadian or any other ship direct to a Canadian port, they are admissible; if they are shipped on a through bill of lading and transshipped at London for New York, they do not then earn the privileges accruing under the treaty.


James Malcolm: Why should that ibe so?


Henry Herbert Stevens: Those who had the matter in hand desired to maintain as far as possible the movement of trade through the expensive ports which have been developed in this country.


Mr. POWER:: I would call the minister'3 attention to item 549, which reads:
Wool, the hair of the camel, alpaca, goat, or other like animal not further prepared than combed:
Provided that importations under this item, wholly the product of any British country, when imported direct from the United Kingdom into a sea, lake or river port of Canada, shall be entitled to the benefits of the British preferential tariff.
Why does this particular item, and item 599 which covers hides and skins, contain this particular proviso? As I understand the minister, all goods transshipped are entitled to all the privileges of the British preferential duty, and I should like to know why these items contain this exception.


Henry Herbert Stevens: Both these items are composite items made up of a number of different articles classified under the term wool in one case, and hides, in the other. As I stated last night the reason this is carried into the treaty is to make it clear that these items are subject to precisely the terms contained in the general tariff act. As I said a moment ago to the
936	COMMONS
Imperial Conference-Trade Agreements
right hon. gentleman, the moment we depart from the terms of general practice, the more confused will administration become. There was no reason in this case why there should be any departure from the treaty, and so we carried the terms of the general act into the treaty.


James Malcolm: I am sorry but I shall have to re-open the question of this direct shipment interpretation. I see nothing in this clause which would give an importer the meaning placed upon it by the minister.


Henry Herbert Stevens: Which clause is that?


James Malcolm: Section 2 of article I. This section says distinctly that the benefits shall accrue on goods imported directly into Canada. Goods are no more imported directly into Canada when they come from Capetown to Liverpool and then to Montreal than if they come from Capetown to Montreal or from Capetown to Portland and then by rail to Montreal. I do not think the interpretation of the minister is contained in the article and if he is going to put an interpretation upon this matter such as he has stated, it should be more clearly defined. We are compelling direct shipment in order to use British tonnage. That may be perfectly justifiable, but it is not direct shipment, it is re-routing even though it may be on a direct bill of lading. I have no argument with my hon. friend as to his method but I do contend that this article does not contain the interpretation put upon it by the minister. I think the importer should know what he can and cannot do.


Mr. ILSLEY:: Has the minister the regulation which does apply that interpretation?


Henry Herbert Stevens: Last evening we had a
very lengthy discussion upon this matter and I pointed out to hon. gentlemen who were asking precisely the same question now raised that the term "direct shipment" had through practice and regulation been given a certain definite meaning. I have under my hand a copy of an order in council dated December 1, 1926. I shall read only part thereof, but will hand it to Hansard so that it may appear in full. It reads:
At The Government House At Ottawa Wednesday, the 1st day of December, 1926.
Present:
His Excellency the Governor General in Council
Whereas by section 1 of chapter 7 of the statutes of 1926, paragraph 1 of section 3 of The Customs Tariff, 1907, was repealed and a new paragraph substituted:
And whereas the Minister of Finance reports that the effect of the substitution was that in 
order to enjoy the benefits of the British preferential tariff, goods must be conveyed without transshipment from the port of any British country enjoying the benefits of the British preferential tariff into a sea or river port of Canada, whereas formerly goods might enjoy the said privileges when imported direct from any British country;
Now therefore, His Excellency the Governor General in . Council, in order to secure a uniform administration of tariff laws, is pleased, on the recommendation of the Minister of Finance, to order and it is hereby ordered that the words "direct shipment" or words meaning direct shipment, wherever they occur in The Customs Tariff or in any trade agreement, shall as respects goods imported into Canada on and after the first day of April, 1927, from any British country entitled to admission into Canada at rates as low as or lower than the British preferential tariff, be held to mean conveyed into a sea or river port of Canada on a bill of lading from the country of origin, showing the ultimate destination to be Canada, without contingency of diversion, and without transshipment except at a port of any British country enjoying the benefits of the British preferential tariff.
His Excellency in Council is further pleased to order that order in council of the 15th November, 1926 (P.C. 1832) be and it is hereby cancelled.
(Sgd.) E. J. Lemaire, Clerk of the Privy Council.
That is precisely what I have been saying for the last two days.


Mr. COOTE:: Could the minister tell the
committee what reduction has taken place in items 163, 164 and 165, and whether or not he anticipates any loss of revenue thereon?


Henry Herbert Stevens: In the case of item 163
the British preferential is fifty-five cents, the intermediate fifty-five cents and the general fifty-five cents plus thirty per cent. Under this agreement the rate is twenty-five cents per gallon. Three cents per gallon is added for each degree of proof spirits above twenty-six per cent. These rates place this particular commodity in line with the rates in Aus-tradia and New Zealand. I may say that the object has been to divert the importation of such cheap wines as may be coming into this country from European countries, chiefly Portugal, to empire channels. I will not dispute the fact that there may be some loss in revenue. Item 164 carries the rate of fifty-five cents per gallon the same as the British preferential. In the case of item 165(a), the British preferential rate is $9.30 per dozen bottles and the South African rate, $7.44; item 165(b), British preferential $4.65 and South African, $3.72; item 165(c), British preferential, $2.32 and South African, $1.86: item 165(d), British preferential, $4.50 and South African, $3.60.

South Africa


George Gibson Coote: Would the minister give the same information with respect to item 156. What reduction is there in the rate?


Henry Herbert Stevens: The rate is the same as
the present British preferential.


Mr. EULER:: Under item 599, hides and
skins are placed under the British preferential. Does that indicate that they are free?


Henry Herbert Stevens: They are free.


Mr. CAYLEY:: Would not one item cover the two items, 54a and 55, both of which are free?


Henry Herbert Stevens: They are separated in the tariff. My hon. friend will notice that item 54a deals with Indian corn for the use of manufacturers of starch or of cereal products. That is free. Item 55 deals with Indian corn, not otherwise provided for. That is free under the British preferential, and free from South Africa, but carries a duty of 20 cents a bushel under the intermediate and 25 cents a bushel under the general tariff.


Thomas Merritt Cayley: Would the minister make
clear item 137? There is a little ambiguity there which I would like to have clarified.


Henry Herbert Stevens: I am afraid I cannot see
what my hon. friend is puzzled about. The facts are these: Items 136 and 137 are free under the British preferential, and we are extending to South Africa the preferential rate on both these items.


George Gibson Coote: Does the intermediate tariff
apply on Indian corn coming from the Argentine?


Henry Herbert Stevens: Yes.


George Gibson Coote: Would that be 20 per cent?


Henry Herbert Stevens: Twenty cents a bushel.


[Stage Direction]
Section agreed to.
Sections 3 and 4 agreed to.
On section 5-Suspension of inconsistent laws.
Richard Bedford Bennett: I propose with the consent of the committee to substitute the section of yesterday for the present section in the bill.


The CHAIRMAN:: It is moved by Mr. Bennett that section 5 be deleted and replaced by the following:
IMr. Stevens-3
All laws and regulations inconsistent with this act and the said trade agreement shall to the extent of such inconsistency and in respect only of the said trade agreement be suspended during the currency thereof.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Schedule A agreed to.
On schedule B.
William Daum Euler: With reference to item
251 (c) dealing with cotton canvas shoes and item 251 (d) dealing with unspecified boots and shoes, and items 253a and 260 dealing with rubber hose, rubber tires and tubes, I would like to know whether the preferential rate which is given in the last column implies that an added preference is given as compared with what we had before?


Henry Herbert Stevens: Yes, there is an increased spread there. It depends upon the price of the goods. It is rather a complicated story.


William Daum Euler: I do not wish the minister
to go into details. I simply wish to know if the preference has been increased.


Henry Herbert Stevens: Yes.


William Daum Euler: Substantially?


Henry Herbert Stevens: Yes. The special feature
of this is that it gives a much more effective advantage against low priced competition.


Charles Gavan Power: What is the ordinary duty
on wood unmanufactured? I notice by item 279 of schedule B that unmanufactured soft wood-coniferous-has a duty of nine pence per 100 superficial feet. What is the ordinary duty?


Henry Herbert Stevens: It is substituting nine
pence per 100 superficial feet for the previous preference of three per cent. This is distinctly advantageous.


Charles Gavan Power: What about hard woods?
The three per cent remains the same as it was, I suppose, on hard woods?


Henry Herbert Stevens: Yes.


Charles Gavan Power: With respect to item 263 (a) dealing with wooden boxes, empty or in shooks, for packing citrus fruits, the duty is five per cent ad valorem. Is there any change there?


Henry Herbert Stevens: It was free before, and
now we have a preference of five per cent.
938	COMMONS
Imperial Conference-Trade Agreements


Charles Gavan Power: What about other boxes?
I do not suppose we ship any boxes except those for packing citrus fruits.


Henry Herbert Stevens: Practically nothing else.


Charles Gavan Power: Under what tariff would
they come in?


Henry Herbert Stevens: It is not included in these items; it would come under the general tariff.


Charles Gavan Power: Is there any change in the rate on shingles under the general tariff?


Henry Herbert Stevens: Yes, there is a change. Previously the duty on shingles into South Africa was 20 per cent against us; now we have a spread of 10 per cent.


Charles Gavan Power: Now it is 10 per cent?


Henry Herbert Stevens: Yes.


James Lorimer Ilsley: Would the minister please indicate the outstanding features in schedule B; that is, are there any particular lines from which the government hopes to increase the exports of Canada to South Africa during the next five years? In schedule A, the item confronting one at the outset, of course, is Indian corn. During the last year or two, according to the figures given to the committee, there has been quite an increase in the importations of Indian corn; it would seem that that business is being taken away from the Argentine and given to South Africa. We are agreeing for the next five years to keep a duty on Indian corn coming from the United States and the Argentine republic. The conclusion one would draw is that South Africa will profit substantially from that arrangement. Are there any outstanding items in schedule B which would give a corresponding advantage to Canada? In other words, if one were asked in what way we hope to increase our exports to South Africa, what would be the proper answer?


Henry Herbert Stevens: Unquestionably the hon. member's question is a most fair and reasonable one. In a general way, I would answer that the whole list is particularly selected because of the opportunities it offers Canadian manufacturers successfully to enlarge their business in South Africa. This list arises from the experience of our own people in the export business, and the study of the market by officers of departments of trade and commerce both in South Africa and in Canada. If one desired he could go through the whole list, item by item, but I can assure the committee that there is not a single item in the

list in connection with which there is not an excellent opportunity for an extension or a continuance of business. I have under my hand some of the major items of our business with South Africa, and possibly hon. members would be interested in hearing them read. The following trade figures are for the calendar year ending March 31, 1931:
Wheat	
Motor ears and parts	
Paper and board	
Rubber tires	
Sodium cyanide	
Heating and cooking appliances. Lumber and manufactures of
wood	
Implements and machinery.. ..
Iron and steel pipe	
Tinned fish	
Iron and steel goods	
Unspecified foods	
Hosiery	
Other clothing	
Binder twine	
Wheat flour	
Rubber and canvas footwear..
Confectionery	
Rubber goods	
Apples	
Bands and belting	
Porcelain insulators	
Paints	
Calcium carbide	
Acetic acid	
Other goods

There are a number of items in connection with which we have already achieved some progress, so far as the extension of our market is concerned. May I say to hon. members that I am not sure it is always wise to announce publicly when an article is taken from a competitive market. This morning I had news cf a very substantial increase in the export of a certain commodity to South Africa. That is now an addition to the trade of Canada, and we are hoping that it will expand into a very large one. Trade in connection with that commodity is taken from our competitors. I may say that the balance of trade has been in our favour right along, and one of the reasons for the agreement is to try to assure to South Africa entry into our market for their commodities. We hoped to expand South African business along the lines indicated, especially in connection with sugar, citrus fruits and a limited number of items. On the other hand Canada is almost unlimited in its opportunities, because we have a very large range of manufactured articles as well as the products I have named. For instance, in connection with apples, in which the hon. member for Hants-Kings is interested, and in

South Africa
which people in my own province have a deep interest, we expect to enjoy a very substantial increase in business. That would more or less balance the item of citrus fruits.


James Lorimer Ilsley: I should like to ask the
minister a question on that point: Why was the period in connection with apples limited from October 1 to December 31?


Henry Herbert Stevens: It must be remembered
in regard to South Africa as well as in regard to Australia that seasonal tariffs are desirable. It is not well to run a risk of not being admitted at all into these countries in the alternate seasons. We are limited to the time which is most advantageous to us.


James Lorimer Ilsley: I would suggest that the
months of January, February and March would be just as advantageous.


Mr. SPEARMAN:: In connection with a
great many of these items no particular rate is specified, but we find merely the notation "lowest rate to any country." The understanding is that we will be put on terms as satisfactory as those enjoyed by any ether country. Of course the value of this arrangement depends largely upon the number of countries receiving similar treatment. I could name many items appearing in the schedule which are treated in the manner I have indicated, but for the purposes of this discussion I shall turn to item 129, referring to motor cars. In connection with that item we find in the margin the notation, "Lowest rate to any country." As I have stated that arrangement applies to many other items. Has the minister any idea as to the number of countries treated in exactly the same way? Is there any restriction as to the number which may be treated similarly. If net the provision may mean anything or nothing, and all will depend on the number of countries sharing the rate.


Henry Herbert Stevens: In cases where the lowest rate provision applies, almost invariably it concerns empire countries. The provision represents, virtually, a preservation of the right to extend the same rate to other parts of the empire. The point in the matter is that to Canada at least there is an assurance of the lowest rate, and in some cases the rate extended to Great Britain. So far as the motor car item is concerned, we will enjoy the same rates as Great Britain. I am not in a position to say precisely how many ether countries enjoy that rate in South Africa. I have not that information before me and some time would be required to get it. My hon. friend
may rest assured however that in making that provision, namely the lowest rate to any country, we are assured a preferential competitive position.


John Livingstone Brown: One item in schedule B
has been referred to a number of times, that is cream separators; could the minister tell us what business Canada is already doing with South Africa in cream separators, and what the rate of duty is in South Africa on that item?


Henry Herbert Stevens: 
Mr. FRASER (Cariboo):: I wonder if the minister could put on the record or if he has information, similar to that which he has just given in regard to cream separators, with regard to box shooks, and what the opportunities are for box shook business with South Africa. It seems that we are going lo import more citrus fruits; should not our box shook trade in Canada be benefited by the exchange?


Henry Herbert Stevens: 
George Gibson Coote: Could I ask the minister
whether South Africa has an important trade
940	COMMONS
Imperial Conference-Trade Agreements
treaty with Germany, and if many of these items on which we get the lowest rate, that is the tariff rate, would not come under the rates obtaining between South Africa and Germany at least on German importations to South Africa?


Henry Herbert Stevens: I think perhaps it is a
little unfair for us to discuss South Africa's affairs here. I wonder if my hon. friend would be satisfied if I assured him that in regard to the precise point he has raised we are entirely satisfied. I would rather not discuss South Africa's relations with Germany, it is their own business. I wonder if my hon. friend would be satisfied with that answer.
Mr. COOTE-. Quite so, I simply asked whether in many cases the rate mentioned would not be the rate which applies on goods imported from Germany to South Africa.


Henry Herbert Stevens: If my hon. friend presses me for an answer I simply say: No, it would not be the rate.


George Gibson Coote: I do not want to press the
minister if he does not wish to answer.


Mr. MARCEL:: Can the minister give the total trade with South Africa for the last five years?


Henry Herbert Stevens: May I ask the house to be satisfied with round figures? I will give the millions and where the hundreds of thousands are large I will give them: This is the total trade of South Africa, calendar years, 1921 to 1931. Is that what my hon. friend asked?


Charles Marcil: No, the total trade with Canada.


Henry Herbert Stevens: 
John Livingstone Brown: Could the minister tell us whether South Africa has any anti-dumping legislation which would prevent the Canadian manufacturer selling cream separators cheaper in South Africa than in Canada?


Henry Herbert Stevens: South Africa, in common with practically all countries, has a provision that when any import obviously of a dumping character, interferes with its internal interests, action may be taken to prevent its intrusion in the market.


Charles Gavan Power: May I ask the minister a question which I think has been asked before: Is there any provision with respect to the labour content or material content of goods manufactured in Canada?


Henry Herbert Stevens: I answered that question last night. There is no specific provision in any of these agreements. The practice or rule governing the various countries operates, as it does at the present, subject to whatever change may be desired. In regard to most of the countries comprised within the British Empire, an empire content of fifty per cent may be accepted as a general rule. But there are, of course, variations. In the case of the mother country it is twenty-five per cent. In the case of the Dominion of Canada, it is generally speaking fifty per cent with the exception of certain articles, such as cottons, where it is thirty-three and a third. Certain variations have been found necessary, according to the nature of the article. In some cases such as cotton, where all the raw material is imported and where its value constitutes a substantial portion of the ultimate cost, then necessarily the empire content must be lowered. In other instances, where the raw material is partly or wholly produced within the empire or within the country, the empire [DOT]content can be raised just as easily. That [DOT]was one of the problems which faced the conference in its attempt to adopt a uniform measure. The matter is still under consideration and study by the various dominions as *well as the mother country.


Charles Gavan Power: What about motor cars?


Henry Herbert Stevens: Motor cars are pretty well standardized in various parts of the empire. It will be recalled that Australia and New Zealand maintain a dual content with certain tariff rates applicable thereto. Fifty per cent carries a lower rate than 75 per cent, and the same thing applies in other parts of the empire.

South Africa


Mr. ELLIOTT:: Would the minister tell me what change, if any, is made in the tariff by the present arrangement with regard to item 134 in schedule B?


Henry Herbert Stevens: I dealt with that very fully last night. The British preference varies according to degrees, and I hope my hon. friend will not ask me to go into all the different degrees, of which there are about twenty.


John Campbell Elliott: No, I do not want all the details, if the minister can just give me the general effect.


Henry Herbert Stevens: South Africa gets the
British preferential rate. We had a very long discussion on this matter last night.


John Campbell Elliott: I am referring to schedule B; I think the minister is referring to schedule A.


Henry Herbert Stevens: My hon. friend is talking about the South African item?


John Campbell Elliott: Yes.


Henry Herbert Stevens: On item 134(a) the minimum is free and the maximum one shilling per hundred pounds. We get the minimum. On item 134(b) the minimum is free and the maximum 8 pence per hundred pounds. We get the minimum. On item 134(d) the minimum is 15 per cent and the maximum 20 per cent. We get the minimum. On item 134(e) the minimum is free and the maximum 5 per cent. We get the minimum. On item 134(g) the minimum is 15 per cent and the maximum 20 per cent. We get the minimum. On item 134(h) the minimum is free and the maximum 3 shillings each. We get the minimum.


John Campbell Elliott: I wonder if the minister has the same information with regard to item 270(b). If it has been given already and is on Hansard I can get it there.


Henry Herbert Stevens: No, I do not think it has been dealt with. There is no change in that item at present; the question is still under consideration by the government of South Africa. The rate there is 5 per cent minimum and 5 per cent maximum. We are guaranteed the lowest rate, but the matter was not settled by the delegation when they were here, as to what spread would be given.


John Campbell Elliott: Is it still a matter of negotiation?


Henry Herbert Stevens: The matter is open for them to act, and in this and a number of other items something may be done. They are under no obligation to make any changes, but if such changes are made we are guaranteed the minimum.


Mr. DUPUIS:: With regard to those items in schedule B on which we get the lowest rate given any country, have we any control over what that lowest rate may be? It might be a very high rate.


Henry Herbert Stevens: We are in precisely the
same position as are all other countries; we control our own rates but we do not control the rates in other countries. There is no question about that, and there is no use beating about the bush. We have no control over their rates, but we are guaranteed the lowest rate that any country receives.


Vincent Dupuis: I understand that the government has no control over the rates in other countries, but I am reminded of the argument of the Prime Minister two years ago, with regard to countervailing duties against the United States. The right hon. gentleman said then that our tariff policy would be dictated by other countries. In connection with these items on which we get the lowest rate given any country it would seem that we are to be dictated to by those countries, and we do not know what the rates will be.


Mr. DONNELLY:: Is this not the same
principle that was contained in the treaty with France with regard to wheat? We were to receive the lowest duty given any country in the world, but there was a great deal of complaint in the house because we did not say definitely what would be the duty, and France increased it.


George Gibson Coote: I could not hear what the
hon. member for Willow Bunch said, but I think he was asking whether this is not the same principle to which objection was taken in connection with the French treaty. There is no limit to the height to which the government of South Africa might raise their tariff against us; there is no provision here which will prevent them from raising it. I should like to ask the minister if that is not correct, and if it is not correct also that we have bound ourselves not to raise our tariff against South Africa.


Henry Herbert Stevens: I thought we had fully
covered that point. It will be observed that in connection with a certain number of items enumerated in schedule B we are to be given the lowest rate. The point really is this: The government of South Africa, in the spirit which actuated the negotiations here, are desirous of giving to the British Empire the minimum tariff rate. In some cases there might be a competition between Canada and Australia in the South African market-in-
942	COMMONS
Imperial Conference-Trade Agreements
deed, that competition does exist-and in other cases there might be competition there between Canada and Great Britain. In these cases the term "lowest rate to any country" is used. At least it ensures that position to us. We are satisfied to compete in the South African market on that basis in connection with these articles to which that term applies. We feel ourselves competent to compete with these other countries, and we are satisfied with that position. I see no reason for alarm at all.


Thomas Merritt Cayley: Does that mean any
country in the world or any one of the dominions?


Henry Herbert Stevens: It means precisely what
it says, any country in the world.


Thomas Merritt Cayley: Then I take it that South
Africa is not going to surrender her right to trade with the other nations of the world.


Henry Herbert Stevens: Not at all.


Charles Marcil: The potato is an important product in Quebec and the maritime provinces. Would the minister tell us whether any progress has been made in the way of getting a market for Canadian potatoes?


Henry Herbert Stevens: We have done a good
deal in that direction. We have worked on that, assiduously during the past year. It is a difficult problem. One of the problems arises out of the difficulties with the United States. We have done, however, all that we possibly can to enlarge the market for the Canadian potato producer, and have made some progress.


Charles Marcil: Can the minister cite an instance where that has been done?


Henry Herbert Stevens: I have not the precise data under my hand. I could bring files that would keep us busy for a week, but I may make this statement, speaking from memory. In the *central American republics, Colombia and [DOT]Panama, and in Cuba, where there has been a *considerable market, we have made some progress as also in some of the other sections of the West Indies. We are discussing the South African treaty at the moment, and I do not think that the question of potatoes has been very definitely considered in this regard. It is a long way to South Africa, and it is a question whether an article as low-priced as [DOT]potatoes would bear the freight and transportation through the tropics to South Africa in a satisfactory manner. However, I will make a note of the question and look into it.


Charles Marcil: What progress has been made in negotiations with England with regard [DOT]to the embargo on potatoes?
* The CHAIRMAN: Order. The committee must confine itself strictly to the question under consideration.


Charles Marcil: That is a reasonable question and I think the minister ought to answer it,


Mr. CHAPLIN:: Does the five-year period apply here?


Henry Herbert Stevens: Yes.


James Dew Chaplin: In certain items in the treaty it is stipulated that we get the lowest *rate to any country, and if the five-year [DOT]period applies we ought to be able to know what that rate is before we start. Can we ascertain when the lowest rate begins?


Richard Bedford Bennett: The hon. member for Macleod and the hon. member for Laprairie-Napierville referred to this matter which has now been raised by the hon. member for Lincoln. If the committee will recall the [DOT]observations made by the South African delegation both in London, in 1930, and in *Canada, in 1932, they will remember that South Africa is not a manufacturing country [DOT]and does not produce motor cars, for instance, nor cream separators, nor such manufactures as cash registers, calculating machines, chains, implements for agricultural purposes, motor trucks, perfumery and toilet preparations, boots and shoes, handles of wood for picks and shovels, ceiling and flooring boards, [DOT]cardboard and linenboard, paper, newsprint *in the original mill wrappers or in rolls, *wrapping paper, paper printed and ruled, lithographed and embossed matter, puipwood, [DOT]pulpboard and wallboard. As regards all these items to which attention has been directed, [DOT]South Africa does not produce them, and [DOT]what they asked us to do was to agree to meet [DOT]any competition that might develop by reason of their giving us the lowest level of tariff they imposed against any country. That we accepted. In other words, if South Africa offers a market to any country in the world for any of the products I have mentioned, that market is avaiable to Canada, and the terms under which they made it available are that we should meet the competition of the world, which we said we were willing to do so long as we had equal opportunities with those who might compete with us. All these items are items which we are capable of producing in increasing quantities and for which South Africa will offer us a market so long as they

South Africa
import such manufactures. According to the views they express, South Africa, in all probability, for a longer period than five years will be importing the items to which I have referred and we shall have an opportunity of securing that market.


John Livingstone Brown: The Prime Minister referred to cream separators. We are well aware that South Africa is not a manufacturing country and does not produce the articles here enumerated, but I felt it desirable to keep before the public mind the fact that cream separators, under another agreement, carry a rate of 25 per cent.


Richard Bedford Bennett: That is correct, and the
explanation is so clear that when it is made I fancy the hon. gentleman will be satisfied. For the moment it does not arise.


John Livingstone Brown: It will take some explaining.


Thomas Reid: May I be allowed to ask a
question with reference to the value for duty purposes. Under article 5 the Baltic exchange will govern the price for corn. What will happen if we in British Columbia find a cheaper market in the Argentine or in the United States? Will the Baltic exchange fix the value for duty purposes, or what effect will that clause have? This is important because we use a good deal of corn.


Henry Herbert Stevens: As I explained last night, the object in including the provision was that the price at which this particular article would be invoiced from South Africa to Canada would be a fair world market price. I do not think my hon. friend wishes me to repeat the statement I made last night.


George Gibson Coote: Are we giving to South Africa a guaranteed preference on a large number of items and, if that is correct, is South Africa giving us a guaranteed preference on any number of items?


Richard Bedford Bennett: With respect to all the
items except the ones I have read, which accord to us the lowest rate in any country, we are receiving a guaranteed preference for five years.


George Gibson Coote: Then may I ask how we
expect to export peas, com and tomatoes in tins or otherwise to South Africa when we have to meet the competition of the world, if ;ur manufacturers need a high tariff on these /ery products when they are marketing them right here in Canada? Is it possible for us to export any of these commodities to South Africa?


Henry Herbert Stevens: 
Vincent Dupuis: What is the duty?


Henry Herbert Stevens: Twenty per cent.


George Gibson Coote: Would not that be an indication that perhaps the tariff on these items-
I mean the Canadian tariff-might be reduced?


Alfred Speakman: I wish to state two or
three points that strike me forcibly with respect to these items. Out of approximately fifty-two items, just one-third or seventeen would enter under the lowest rate to any country. There are certain points which strike me quite forcibly and about which I should like to comment, but I do not intend to take up too much time in a discussion thereof.
The first has been mentioned already by the minister. We are expected to be able to compete satisfactorily in South Africa on even terms with other countries, but in this country these same manufacturers are protected to a large extent. That is a rather significant situation.
So far as I can see and unless some statement has been made in which good faith is involved, there is nothing to prevent South Africa extending these lowest rates not only to other members of the British Empire, in which case it would be a preferential rate, but to any other country in the world. Any preference we receive with regard to these items is dependent upon the policies adopted by South Africa towards other countries. This does not debar South Africa from lowering her rates to other countries to any degree she wishes at any time during the next five years. This question, which I think is very important, then arises: To how many countries are these special rates extended, with what countries must we compete under these rates at the present time and with what countries must we compete in the future? It seems to me that in the case of seventeen out of fifty-two items we have received no preference; all we have received is a guarantee that we shall be permitted to meet any country in the world on equal terms in open competition.


Henry Herbert Stevens: My hon. friend does not
state the case quite fairly; I think he just reverses the application of this agreement.
944	COMMONS
Imperial Conference-Trade Agreements
He says that we are to be permitted to compete with any country in the world but if he will look at the agreement I think he will find what appears to be clear enough, that whatever rate South Africa may grant in the future to any country, that special rate will be granted to Canada. That is entirely different from the meaning my hon. friend puts upon that clause; that is the basis upon which this agreement is made. Should South Africa desire to extend a lowered rate to some other part of the empire or to some other country in the world, whatever that rate is, Canada will get the advantage of it.


Thomas Merritt Cayley: Was there any discussion
as to the possibility of finding a market in South Africa for our dairy products?


Henry Herbert Stevens: I think it would be unprofitable for us to go into a lengthy exploration of that problem. Offhanded, I would say that there is not very much chance, except in the case of our excellent Canadian cheese. I doubt if butter could be exported to South Africa considering the long haul through the tropics.


Ian Alistair Mackenzie: Australia and New Zealand export to South Africa.


Henry Herbert Stevens: Australia and especially
New Zealand have developed a highly intensified dairying industry. Canada's major external market is Great Britain, the largest butter market in the world. If we want to speculate on what may happen in the future, we can do so, but I say quite frankly to my hon. friend that it does not look as if there would be much of a market in South Africa for Canadian dairy products.


Thomas Merritt Cayley: How about condensed
milk?


Henry Herbert Stevens: There are possibilities in
the case of condensed milk and other manufactured products of that kind.
Mr. DONNELL A':	What is the South
African duty against wheat?


Henry Herbert Stevens: 
[Stage Direction]
Section agreed to.
Bill reported.

[Stage Direction]
Right Hon. R. B. BENNETT (Prime Minister) moved the second reading 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.
He said: Mr. Speaker, during the progress of the debate upon the resolution upon which this bill was founded, I think the whole matter was so fully discussed as to make it unnecessary for me to do more than refer to one or two points about which there seems to have been some difficulty on the part of hon. gentlemen opposite. It will be observed that at page 911 of Hansard the hon. member for Shelburne-Yarmouth (Mr. Ralston) is reported as follows:-
When we look at the United Kingdom agreement as defined in Great Britain and find that we receive only free entry, but no agreement that the duties are to be kept up or imposed against the rest of the world, and compare with that our agreement W'hich provides that the margin of preference shall be maintained, and that the present tariff rates on one hundred and fifty-nine articles are to be pegged for five years, wre immediately realize the difference.
I think it has been made abundantly clear that in the agreement entered into between the United Kingdom and the Dominion of Canada there are certain items, largely agricultural, with respect to which we have a clear, definite and guaranteed preference for a period of five years. The first concession established by this agreement is that there shall be free entry for all products except a small number specified in the existing tariffs of Great Britain when the Import Duties Act was passed in March, 1932. We are to have free entry into the markets of the United Kingdom. Article I establishes that so clearly that were it not for the observations which have been made and which I cannot understand, I would not now read it. It reads as follows:
His Majesty's government in the United Kingdom undertake that orders shall be made in accordance with the provisions of section 4 of the Import Duties Act, 1932, which will ensure the continuance after the 15th November, 1932, of entry free of duty into the United Kingdom of goods consigned from any part of the British Empire and grown, produced or manufactured in Canada which by virtue of that act are now free of duty subject, however, to the reservations set forth in schedule A appended hereto.

United Kingdom
It follows that with the exception of the items mentioned in Schedule A free entry is established for all the products of this dominion into the markets of Great Britain.
Charles Marcil: Except those under embargo.


Richard Bedford Bennett: There are none under embargo.


Charles Marcil: Potatoes.


Richard Bedford Bennett: I shall speak to that matter presently, and I ask the hon. member to be good enough to remember that the house is not now in committee. With respect to Schedule A which limits to three years the provisions which I have just read and which would otherwise be extended for five years, it is only necessary to look at the language of that schedule in order to remove all possible doubts. It reads:
As regards eggs, poultry, buttter, cheese and other milk products, free entry for Canadian produce will be continued for three years certain. His Majesty's government in the United Kingdom, however, reserve to themselves the right, after the expiration of the three years, if they consider it necessary in the interests of the United Kingdom producer to do so, to review' the basis of preference so far as relates to the articles above enumerated and, after notifying His Majesty's government in Canada either to impose a preferential duty on Canadian produce -whilst maintaining preferential margins, or in consultation with the Canadian government to bring such produce within any system which may be put into operation for the quantitative regulation of supplies from all sources in the United Kingdom markets.
Not the preference, but the basis of the preference:
-so far as relates to the articles above enumerated and, after notifying His Majesty's government in Canada either to impose a preferential duty on Canadian produce whilst maintaining preferential margins, or in consultation with the Canadian government to bring such produce within any system which may be put into operation for the quantitative regulation of supplies from all sources in the United Kingdom market.
I can hardly find it possible -to think that there should have been differences of opinion as to what is meant by that schedule. We have in article 1 provision for free entry for a period of five years, but with respect to eggs and poultry, butter, cheese and other milk products that free entry is for three years certain, but the preference is to be extended for the remaining two years of that agreement. That preference in terms of that schedule may be expressed (a) by a duty against Canadian products as well as against foreign products, but with the maintenance of a preference in favour of Canadian products; that is, to re-53719-80
view, not the preference, but the basis of the preference only; and (b), and this is so clear that there need be no doubt, a quota system, and whatever quota system there may be, it must be arrived at in consultation with the government of Canada.
Then comes the provision with respect -to legislation to be passed to secure for Canada a certain position with respect to items therein specified:
His Majesty's government in the United Kingdom will invite parliament to pass the legislation necessary to impose on the foreign goods specified in schedule B appended hereto, the duties of customs shown in that schedule in place of the duties (if any) now leviable.
In other words, there is a specified list of goods which for five years will find entry into the British market on a preference basis indicated in the terms of schedule B. That is, whatever may be the price of wheat, for instance, it will have to pay two shillings a quarter to find a market in Great Britain if it comes from a foreign country whereas coming from a British dominion it enters free. It is important in view of what was said last evening that I read again on to the record, in order that there be no doubt, just what items are covered by the five-year guarantee with particular reference to the agricultural products. I need hardly say that in the framing of these agreements it was found neither necessary nor desirable that there should be duplication, or that- there should be repeated in the Australian agreement, for instance, all the items that received this guaranteed preferential treatment in the Canadian agreement, and conversely, it was not necessary to place in the Canadian agreement all these items that received preferential treatment from Australia, and the same applies to South Africa and New Zealand; for the benefits accorded in respect of any one item in the form of a guaranteed preference for five years to any one of the dominions accrue, of course, to the benefit of all the others. Let us have no misapprehension as to the extent of that list and the character of the preference granted. These have been worked out with great care with respect to all the countries that may be concerned.
We have, for instance:
Butter, 15s. per hundred-weight.
Cheese. 15 per cent.
Eggs in shell:
(a)	Not exceeding 14 pounds in weight- per great hundred-Is.
(b)	Over 14 pounds, but not exceeding 17 pounds-per great hundred-Is. 6d.
(c)	Over 17 pounds-per great hundred- Is. 9d.

946	COMMONS
Imperial Conference-Trade Agreements
Milk, condensed, whole, sweetened, 5s. per hundredweight in addition to the duty in respect of sugar content.
Wheat, 2s. per quarter (about 6 cents per bushel).
Then we have:
Barley (Australia and India), 10 per cent.
Flour, wheat (Australia), 10 per cent.
In other words, the millers of Canada have a guaranteed preference in the market of Great Britain for flour of 10 per cent ad valorem, not ten cents a bushel, but 10 per cent ad valorem, for a period of five years.
On honey, which is mentioned in both the Australian and New Zealand agreements, seven shillings per hundredweight, or something over a cent and a quarter per pound:
Milk, condensed, whole not sweetened (Australia, New Zealand and South Africa), 6s. per hundredweight.
Milk powder and other preserved milk not sweetened (Australia, New Zealand and South Africa), 6s. (?) per hundredweight.
Meat, canned (Australia and New Zealand), 10 per cent.
Canned meat is mentioned in both the Australian and New Zealand agreements. Being a primary item they sought to have a preference secured for them:
Meat extracts and essences (Australia and New Zealand). 10 per cent.
Potatoes (South Africa and Southern Rhodesia), 10 per cent.
Our potatoes have that benefit subject, of course, to this:	At the bottom of all these
agreements there must be freedom from disease of the potatoes or cattle or of anything else. In the granting of preferences, no question should ever arise of granting a preference to invade a market within the British dominions with diseased products, whatever they may be. With respect to potatoes, Great Britain has spent very large sums of money in making it impossible for the Colorado beetle to find lodgment in that country. At one spot in France the Colorado beetle was imported in a bag of potatoes, with the result that France had to spend very large sums of money in stamping out the evil that arose by reason of the Colorado beetle finding lodgment in their country. Great Britain has been extremely anxious about the health of potatoes, or perhaps I had better say, about the sound condition of the potatoes imported, because they have been fearful that the Colorado beetle would find lodgment in their country. Finally we arranged with them, believing as we do that the precautions we take are ample to prevent the possibility of the Colorado beetle finding lodgment in Great Britain, and I believe my

hon. friend from Prince would think it was desirable that we should do so, to send one of their experts over here to observe the method in which potatoes are packed in this country for shipment. In other words, we think we can demonstrate beyond peradven-ture that there is little or no opportunity for the potato bug to find a place in shipments of potatoes from this country to the detriment of the country that is importing our potatoes. Be that as it may, I think their expert is already in this country observing the method by which we prepare our potatoes for shipment. I for one, if I were living in England, would not for a moment doubt the desirability of preventing by every means in my power the lodgment of the Colorado beetle in that country, and the efforts they have made and the money they have expended, and will continue to make and expend, for the purpose of freeing their country from that dreaded scourge so far as potatoes are concerned, is a sufficient indication that it is something more than a misapprehension that they have. It is founded on a realization that the advent of the Colorado beetle to Great Britain would have most injurious consequences.
Then, after potatoes, we have dressed poultry :
Poultry, dressed (Australia and New Zealand), 10 per cent.
Seeds, grass and clover (New Zealand), 10 per cent.
Then we come to fruits. I have dealt with some of the agricultural products. Of all our crops the most important, and the largest single item in our shipment of grains, is wheat. In point of value, too, in days gone by it ranked first among the exports from this country. When you contemplate just what is meant by a preference of two shillings a quarter applied as a duty to shippers wrho are not able to take advantage of the preference, and what is involved in the product of wheat, namely, flour-and may I say that we have shipped more grain to Great Britain during the last few months than has ever been shipped during the same months in recent years-I think it will be realized that our grain is once more coming into its important position in the markets of Great Britain. It is true you cannot say that that is because of this statute, which is not yet enacted. It is because they realize and believe that we are capable of sustaining their requirements to a very large extent, and the preference which they have granted was for the purpose of ensuring that winch they desired.

United Kingdom
Then, we have apples to which I referred' the other day, on which there is a rate of 4s 6d per hundredweight. Then, preferences are given on the following agricultural items:
Apples, raw, 4s 6d per hundredweight.
Beans, 10 per cent.
Bran and pollards, 10 per cent.
Casein, 10 per cent.
Fruits, canned, other than canned apples, 15 per cent in addition to the duty in respect of sugar content.
Fruits, dried, other than currants and other than dried fruits now dutiable at 7s, 10 per cent.
Fruits, preserved by chemicals or artificial heat, other than fruit preserved in sugar, 10 per cent.
Fruit juices, 10 per cent.
Goatskins, 10 per cent.
Ground nuts, 10 per cent.
Linseed, 10 per cent.
Lucerne seed, 10 per cent.
Macaroni, 10 per cent.
Maize, flat, white, 10 per cent.
Maize products, 10 per cent.
Chemical fertilizers, 10 per cent.
Millets, 10 per cent.
Oils, non-essential vegetable, 10 per cent.
Oil seed cake and meal, 10 per cent.
Pears, raw, 4s 6d per hundredweight.
Peas, dried, 10 per cent.
Sausage casings, 10 per cent.
Sugar of milk, 10 per cent.
Wines, a margin of preference amounting to 2s per gallon.
Then, the following preferences on the fishery items:
Canned salmon, 10 per cent.
Canned fish, other than salmon, 10 per cent.
Codliver oil, Is 4d per gallon.
Crayfish, 10 per cent.
Fish, fresh, sea, 10 per cent.
Fish, cod, 10 per cent.
Hake, fresh, 10 per cent.
Marine shell, 10 per cent.
Oyster shell grit, 10 per cent.
Salmon, chilled or frozen, ljd per pound.
Whale oil and whale oil products, 10 per cent.
Then we come to the mineral items:
Asbestos, 10 per cent.
Copper, unwrought, whether refined or not, in ingots, bars, blocks, slabs, cakes and rods, 2d per pound.
Lead, 10 per cent.
Magnesite, 10 per cent.
Magnesium chloride, 10 per cent.
Zinc, 10 per cent.
Jute manufactures, 20 per cent.
Leather, 10 per cent.
Tanned hides and tanned skins, 10 per cent.
Then, turning to page 7 of the bill before the house it will be observed that timber of all kinds will be imported into the United Kingdom in substantial quantities from Canada, in so far as now dutiable. Then, the schedule refers to fresh fish, salmon, other fish canned, asbestos and so on. The articles in schedule C are to receive the preference as indicated. Now, that preference is an 53719-60 J
undertaking on the part of His Majesty's government in the LTnited Kingdom that the general ad valorem duty of 10 per cent imposed by section 1 of the Import Duties Act on the foreign goods in schedule C shall not be reduced, except with the consent of His Majesty's government in Canada.
So we have first, the free entry for everything, with the exception of a small number of items that carry tariff rates, to which I referred in my opening statement, and a few other items, unimportant so far as we are concerned at the moment, against which duties were imposed some years ago. That is, free entry is the general rule. Then in schedule B, with respect to that vast number of items which constitute our agricultural products, we have a preference in the United Kingdom market guaranteed for five years. We have in schedule C a further preference guaranteed for five years with respect to a certain number of agricultural and other raw products. By schedule A it is provided in respect of a few articles that free entry is to be maintained for three years certain, the preference thereafter to be continued for another two years either by a margin of tariff by way of preference, or by a quota.
Then we have in addition to that a large number of items appertaining to the mineral kingdom which are of tremendous importance to this country, in addition as I have said to the entry of goods including manufactured products of Canada. These are the general points, without going into detail, because I put upon Hansard when presenting the resolution upon which this bill is based a detailed statement of the situation. We recognize that in connection with food products and certain mineral products, where the products of the dominion are more than ample to meet the requirements of Great Britain, where there is an export surplus beyond what will meet the requirements of the United Kingdom, the world's prices prevail. And those world prices are the prices which must determine the price charged on first sale. I shall not labour the question which has been so well covered, but would state that first sale means, and has always meant, the first purchase or the first sale of the commodity of a purchaser. That is the first sale. That first sale price must be the world's supply and demand price, and about that I suppose there can be no doubt in the mind of any hon. member in the house. In the absence of a premium on account of quality, the world's supply and demand price would prevail.
In this instance we have said that with respect to the Dominion of Canada we are
948	COMMONS
Imperial Conference-Trade Agreements
content that our agricultural people and our mineral producers should meet any markets or any producers in the world in the markets of Great Britain. Having done that we are accorded a preference on copper, zinc, lead, asbestos and wheat. So that the foreigner, whoever he may be, or from whatever country he may come, who desires to place his product in the market of Great Britain, through any port, will have to pay, before he does so, the amount I have indicated- whether he be selling wheat, flour, mineral products, or any other products I have mentioned. That is the position.
Those are the terms which have been made, and I believe such terms should commend themselves to the judgment of Canadians. There may be differences of opinion, but at any rate those are the facts. Then the United Kingdom agreed that with respect to our cattle she would pass the necessary legislation to permit the landing of our cattle on terms competitive with those of the Irish Free State. It will fee understood that that legislation has already been passed, and the bargain in that regard has been implemented. Then, further, the government of the United Kingdom agreed that it would deal with the pork industry on a basis which would be satisfactory to Canadians. I have heard many adverse criticisms with respect to the provisions regarding pork and the pig industry. Perhaps hon. members opposite will recall, and I have no doubt many hon. members do, that from a political standpoint the late Sir Wilfrid Laurier regarded pork as more important than wheat.
What was the position? We have Great Britain called upon to decide whether or not they would deal with their domestic producers either by a tariff preference or by a quota preference. For a long time the agitation in favour of a .tariff preference seemed to be in the ascendant, but later it became clear that the British government had concluded that a quota preference with respect to the pork industry was more desirable than a tariff preference. With that in mind they appointed a commission, and the report of that commission has been made since the opening of this session. Under that report the quota system has been-or at least will be established, because the recommendation of the commission is to that effect. This dominion is to find itself on an equality with the British producer, and under the quota system we will be allotted up to 2,500,000 hundredweight per annum. I need hardly point out to you, sir, that this is a larger quantity than this country has ever exported into Great Britain, and it affords an ample margin for any develop-

ment that may take place in the industry in Canada; so large a margin in fact that we would have to increase our production many times over what it has been in order that it might be met. I regard that as of first rate importance. Notwithstanding what has been said by hon. gentlemen apposite, we find that this Dominion of Canada has secured in the market of the greatest importing community to which we can possibly have access a freedom for the distribution of its pork products in terms similar to those of the British producer, to the extent of two and a half million hundredweight per annum. That wre regard as a very important provision of the agreement.
Then we come to another article of commerce, namely tobacco. In 1923 the matter was under discussion in Great Britain. Later the British government enacted legislation that provided for a tariff-or a preference, we will put it that way-of two shillings and a halfpenny per pound, or approximately fifty cents. Now the price of tobacco in this country has fluctuated from eighteen to forty cents. The price this year runs from eighteen to twenty-four cents, I think. In the neighbouring republic the price runs from twelve and a half to fifteen cents a pound. We Canadians are now to have in the market of Great Britain, a market of 40,000,000 people, a preference of substantially fifty cents a pound for the next ten years on tobacco. I may point out to this house that experiments in western Ontario have indicated that the quality of flue-cured tobacco there produced has been extraordinarily fine, and that the production has gone as high as one thousand pounds per acre. The average in Rhodesia, in India and in the United States has not been in excess of five hundred pounds per acre. So that the Canadian, with his higher rate of production, and a tariff preference of fifty cents a pound, is afforded an opportunity of which I think he has not been slow to avail himself. That is during the years that are past, when the same rate of duty prevailed-and I do not say for a moment that the duty has been changed, for it has not; it is the same fifty cent rate that was established in, I think, 1923 or 1925-


Mr. MOTHERWELL:: I think 1923.


Richard Bedford Bennett: That was renewed, and now we have it extended for the further period of ten years. We oannot but think that will be of the greatest possible benefit to the Canadian producer.
That in a general way constitutes what we receive, in addition to the provision that has been made in connection with the self-governing colonies and protectorates, who are to

United Kingdom
accord to this dominion any preference which may for the time being be granted to any other part of the British Empire, with limitations in connection with the political conditions in South Africa. Against that what have we agreed to do?
But before I pass to that, my friend the Minister of Finance (Mr. Rhodes) reminds me that I should point out the provision that has been made with respect to fair competition. It will be recalled that our timber was subject to unfair competition from Russia. It will also be recalled that other Canadian products were subject to like unfair competition. I once gave this house an illustration with respect to asbestos, I think. There is a small asbestos mine in the eastern townships of the province of Quebec. The output of asbestos from that mine was taken entirely by one customer in the United States. The gentleman who is the president of the enterprise told me this himself in this city, when he happened to be here in connection with other matters. For years they had taken the entire product of that, asbestos mine. The representative of the soviet in New York had endeavoured to induce him to try their asbestos. The quality of it was known to be good. Finally he said: Well, you may send us a quotation. And they sent him a quotation, which was exactly half the price he had been paying before. He was therefore compelled by the very nature of things in these difficult times to purchase that asbestos. The Canadian mine was closed down; the asbestos was acquired from Russia, and warehouses were established in which quantities were stored to meet any possible demand that might arise in connection with the business of which this gentleman was president. So we asked that, with respect to those articles of commerce, those commodities of trade in relation to which with state aid or under state control there was unfair competition, steps should be taken to enable the executive government to control such unfair competition. Finally there was introduced into the agreement the provision which will be found at the end of it, article 21:
This agreement is made on the express condition that, if either government is satisfied that any preferences hereby granted in respect of any particular class of commodities are likely to be frustrated in whole or in part by reason of the creation or maintenance directly or indirectly of prices for such class of commodities through state action on the part of any foreign country, that government hereby declares that it will exercise the powers which it now has or will heTeafter take to prohibit the entry from such foreign country directly
or indirectly of such commodities into its country for such time as may be necessary to make effective and to maintain the preferences hereby granted by it.
In other words, putting it shortly, we provided that the preferences which are set forth in the agreement should not be nullified or frustrated by reason of unfair competition under state control, and that if either government directed the attention of the other to such fact then the government whose attention was directed to that fact would take appropriate measures to prohibit for such time as might be desirable the importation into its country of this commodity or article.


Edward James Young: Has the mine been opened
up again?


Richard Bedford Bennett: The hon. gentleman is
not expected to ask that form of question in this house; for he knows perfectly well that no one is in a position to say whether the mine is opened up yet or not. I have not inquired, but I shall be glad to give him the address of the gentleman to whom he may write for information if he so desires.
Now let me go a step further in respect to that. Not only has that happened, but it will be recalled that a trading agreement was entered into between Great Britain and the Russian Soviet. That trading agreement is in the form of a protocol to the treaty that was to be made, and the Right Hon. Arthur Henderson signed the agreement on behalf of the British government. Owing to the long delay in negotiating the treaty of commerce the protocol was provided; it contained a provision that notice terminating it might be given, and in accordance with the agreement arrived at in Ottawa the British government has given the necessary notice. My memory is that at the end of six months that agreement will lapse by reason of the notice thus given. It will then, of course, as the British government have said, be competent for them to negotiate a fresh treaty or protocol with respect to trade with Russia. There never has been a prohibition of trade with Russia, either in Canada or in Great Britain. I directed attention the other day to the fact that we had an agreement with Russia under which quasi-diplomatic relations were maintained between the two countries. My right hon. friend the leader of the opposition gave notice terminating diplomatic relations at about the same time notice was given by Great Britain after a raid had been made upon the Arcos building which housed the Russian representatives. We gave notice terminating our diplomatic relations with
950	COMMONS
Imperial Conference-Trade Agreements
Russia, but we did not terminate our commercial relations. Russia has been buying from us, and, in a smaller way, we have bought some few commodities from Russia. When this government came into power, however, representations were made to the effect that competition was most unfair with regard to many articles, and we took power to pass an order in council prohibiting the importation into this country from Russia of commodities that might be indicated or goods that might be specified. In accordance with the power thus conferred on the government an order in council was passed that did prohibit the importation into this jountry of anthracite coal and several other articles including furs, though that later was amended to mean furs not raw but partly fabricated, and it included pulpwood as well.
Let us see the reason for that action. Apart altogether from the unfair competition, any person passing down the St. Lawrence river, as I did, might have seen ships laden with pulpwood from Russia, which was being sold in Canada at a price that bore no relation to the cost of production. That was clear. Those who saw the hard coal that came to this country realized that the price at which it was being offered at the start would have had the effect of entirely destroying the trade with Great Britain, which we were endeavouring to foster, and to some extent the trade with the United States. We conceived it to be our duty on the facts before us, to pass the order in council which we did pass and which had the effect of prohibiting the importation into this country of the articles specified.
I think this may be an appropriate time to make an observation with regard to oil, because more than one hon. member opposite has referred to that question. While an investigation is still under way with respect to oil, I will only say this: Last spring representatives of a large industrial concern in this country asked the government to agree to the exchange of aluminum for hard coal. We told them we did not propose to change the terms of the order in council that prohibited the importation of hard coal from Russia, for two reasons. Apart altogether from the unfair competition and the conditions under which the coal was mined and shipped, there was one other factor. We had been endeavouring to assist the Welsh hard coal industry, which could survive as far as Canada was concerned only if that prohibition was maintained. Therefore we clearly and

emphatically told these interests that we could not agree to any such arrangement.
But there were items not covered by the embargo, and negotiations were entered into -I am bound to say they were not communicated to me until they had been completed, for reasons that are obvious-by w'hich petroleum products were to be exchanged for aluminum. The petroleum products that came to Montreal in a Danish ship-not a Russian ship-were a mixture of crude oil, fuel oil and gasoline. An analysis would indicate that the gasoline had been through cracking coils, in other words, had been manufactured or refined by the latest and best methods known, and then mixed with a small quantity of fuel oil and crude petroleum to bring it up to the requisite specific gravity to come within the terms of our tariff item and enable it to be classified as crude oil not in its natural state. Our policy in this country has been, since we have had no substantial quantity of crude oil produced here, to permit it to find access to our markets free of duty. Crude oil not in its natural state, that is, synthetic crude built up from a mixture of petroleum products, has had to pay a duty of three-tenths of a cent, one-sixth of a cent, and so on, per gallon. When it became apparent that this product was a mixture of refined gasoline, crude petroleum and fuel oil, w7hich is crude petroleum from which the lighter and more volatile substances have been taken, and which has a very considerable weight, it became clear that these substances had been blended for the purpose of creating the requisite specific gravity to enable the mixture to come within that item in the tariff which describes it as crude oil not in its natural state.
The matter then resolved itself into a determination, which the Department of National Revenue is carrying on, of how that oil should be classified. But there was still another question, that of fair or unfair competition. We had to consider whether or not the introduction into this country, under the conditions I have mentioned, of quantities of so called crude oil at prices which, while comparable with the prices of crude oil imported from the United States or South America, were not comparable, it is alleged, with the prices of the different ingredients making up that product, constituted unfair competition. In other words, if the product was something from which gasoline could be obtained merely by rectification, without requiring to be refined, that condition would constitute unfair competition.



S, 1932

[Stage Direction]
United Kingdom
The only point that arises in this regard under this agreement is in connection with petroleum from the island of Trinidad. Trinidad has been producing substantial quantities of crude oil. In itself that crude oil is not of the highest quality, and the importation of petroleum products into Canada from Trinidad has meant the importation of a mixture of a partly refined product and crude and fuel oils, something like the Russian product. Trinidad oil has a preference under the agreement into which we have entered, and the question was whether or not the importation of this product from Russia constituted unfair competition within the terms of article 21, which I have just read. That matter is still under consideration and advisement, and the government depends for its ultimate decision upon those facts which are capable of exact determination ibut which as yet have not been determined. If, as a result of the exact determination of those questions, it becomes apparent that this imported petroleum product, call it what you may, is calculated to frustrate the operation of the agreement as it now stands with regard to the island of Trinidad, then there will be *,n embargo against the importation of that oil into Canada.
The next provision to which I direct attention is this:	Having received the benefits to
which I have referred-and I use that word "benefits" despite the fact that seme objection has been taken to it and to the word "concessions"-under the agreement, we undertook to pass legislation giving effect to the provisions contained in schedule E attached to the agreement. When the agreements were concluded they were not published to the world in so far as tariff changes were concerned, except where they w'ere of a character that would not in any sense involve forestalling or the making of purchases in anticipation of the enactment of the legislation. Schedule E was not published. It was first published when it was made known to this house, and immediately upon being made known to this house the proper resolutions were moved in order that it might become part of the tariff structure and that forestalling cr the anticipation of its provisions in the way of purchases could be prevented.
These tariff schedules which we have submitted to the house involve as well as schedule E to this agreement the other tariff provisions with respect to South Africa and the other British dominions. It is clear that in stating the articles with respect to w'hich we were willing to make changes we did so in general terms, and I think my right hon. friend will realize that it became essential to
carry into our tariff structure the changes brought about by reason of the agreement. And so the Minister of Finance has in his hands the schedules in the ways and means committee for the purpose of incorporating into our tariff structure the changes which we agreed to make in the agreement with the United Kingdom and the other dominions.
It is perfectly true we bound ourselves for five years to maintain in a general way the tariff structure that I have mentioned; it is perfectly true that changes may be made from time to time. The margin is to be preserved. Rut there is one other point to which I desire to direct attention and it is this. We realize that in this changing world, having made the arrangements we have and which we believe are beneficial to this dominion, it was desirable also to anticipate the possibilities of changes being made, and so in order that there might be no doubt that the general rule that governs with respect to contracts should prevail, in article 23 we have stipulated that in the event of circumstances arising which, in the judgment of His Majesty's government in the United Kingdom or of His Majesty's government in Canada, as the case may be, necessitate a variation in the terms of the agreement, the proposal to vary these terms shall form the subject of consultation between the two governments. In other words, dealing as we were with our own people and making arrangements having regard to the depressed conditions that exist in the world and the universal character of the depression, but which arrangements two years from now, to use the language of one hon. gentleman opposite, it might be desirable to change, we have contemplated that the two governments should consult for the purpose of arriving at any changes that may be desired.
Sir, I am not oblivious of the criticisms that were made -when the resolution was before the house, that these tariff reductions do not go far enough. I suspect that most Canadians realize, judging from the communications I receive, and the statements I hear, that after all the statesmen from the United Kingdom might fairly be regarded as alive to their own interests and capable of determining to what extent the tariffs should be reduced to permit of their making the concessions they have made to us. That would seem to me to be axiomatic, but apparently I am wrong, for I have listened day after day to hon. gentlemen complaining that sufficient concessions have not been granted to the United Kingdom. Who is the best judge of that-we or they? Their House of Commons has adopted this agreement; I believe it is adopted today in the
952	COMMONS
Imperial Conference-Trade Agreements
Lords. Their house met on the 18th day of October and we met twelve days before that. Those who will take the trouble to read Hansard and analyze the speeches that have been made will realize how great has been the concern of the average member for the taxpayer in Great Britain and how little has been his concern for Canadians. They will realize the extent to which he has been crying and weeping over the taxation of food which he is not going to pay, his commiseration with the poor man in England, his concern for him. But are not British statesmen capable of seeing to that? Did the parliament of Great Britain vote down by one of the greatest majorities in its history the amendment that dealt with that very feature, or did it not? If the press Reports are to be relied upon, the parliament of Great Britain gave no uncertain answer to that issue, because they knew that there would be no increase in the tax on food. They knew that unless the British miller desired to buy his grain from some other than a British country there was no tax payable, but that if he desired to buy from a foreigner he would pay the tax. That is his business, not ours. And the British House of Commons adopted that view without difficulty.
It has also been said that, with respect to textiles, there should have been a much greater reduction in tariffs. I explained that specific duties had been reduced 33^ per cent in one case and 25 per cent in the other, and the hostile press complained and carried articles showing how little it meant. Did it ever occur to this house that so far as we are concerned the law of the country, enacted as it is in tariff legislation, provided for these imposts in order that there might not be a collapse of industry in a period of world depression such as we have never seen heretofore? Will anyone say, in looking at the work that has been done by the textile industry in Canada during the last two years, in affording employment, that its rate of reward has been incommensurate with the risk? Who will say that? Will anyone say that their profits have been unfair or unreasonable? Does anyone want to see the industry killed? Judging by some speeches that have been made on the opposite side, some hon. gentlemen apparently desire that the industry should be destroyed, notwithstanding that for every dollar made, 12 cents goes to the exchequer of the country. And if we are to have, as has been said, an increase in income tax for the purpose of providing revenue with the aid of the printing press, then of course it follows clearly that if there are no profits there is no revenue; and no one who has studied the reports of any textile 	Ji , T
industry in Canada, whether it be cotton, wool or silk, will say that these profits have been extravagant during the last two years.
This I say: Had we not passed the legislation we did in 1930, there would have been no textile industry operating in Canada today
not any. And what is more, there is not a thoughtful observer, not an economist, not an analyst who does not say that this is so- not one. Why? During the very discussions that took place during this conference, when we were talking about textiles, on the very day when the conversations opened in connection with cottons, there came into my hands a statement to the effect that before a judge of the chancery division in London a motion had been made to reduce the capital of one of the greatest cotton industries in Lancashire by £4,000,000-not dollars-because their trading loss had been £3,000,000-their trading loss! And we are asked to say that the proper thing to do in a country such as this is to allow concerns that are making a trading loss to destroy Canadian enterprises. That is what we are asked to do. Take the condition of the woollen industry in this country when we came into office. Will any man say that as a result of the few years that preceded 1930 the effect was not to destroy that industry?
James Malcolm: Oh, no.


Richard Bedford Bennett: It was; and what is
more, no man knows it better than the exMinister of Trade and Commerce, because the facts and figures are on file this very day in the office which he formerly occupied. Industries which today are flourishing in little communities in Ontario, giving employment to fifty or a hundred people, were closed down when we came in. Moreover, the entire industry was threatened with insolvency. That is the position. We saved the industry by the action we took. We saved the cotton industry of this country, we maintained the silk industry, and of every dollar they have made during the last two years from ten to twelve per cent has been paid into the Canadian exchequer.
We were confronted with competition of a character such as this country has never seen or known of before. Were we to lie down to it? Were we to see the industry destroyed? Were we to see our country grovelling in the dust and then stand with pride on the street corner and say: Look at what has been done to these men with money whom we have destroyed. Who are the people who own these industries? Look at the share registers of the cotton companies, the woollen mills or the silk mills, and find out who they are.

United Kingdom
Vou will find there are many widows and orphans and other people who have believed in the integrity of our industry and have invested their money therein. They believed the return would be certain, but they have seen that return lessened and lowered. The result has been that money has been driven out of productive industry into bonds, largely of the country; the money has been taken out of industrial development and put into sources which will make the investment sure.
When we were faced with this situation in the preparation of these agreements we had to say to ourselves:	In these days of unfair
competition, in these days of world-wide depression, in these days when it is better, as the hon. member for Ontario (Mr. Moore) has said, to choose to give employment to Canadians rather than to those who live in Czechoslovakia or any other country, we cannot make slashing reductions in the tariff without imperilling the very industrial fabric of this country built up during the last half century. I am not saying that if I had to determine whether or not some of these industries should be built up, I would build them up; I say frankly to this house, as I have said before, if I had to decide whether some of the industries in this country should or should not be here, I would say they should have never been here. But they are here, we have assisted in their maintenance and we are now confronted with a situation where we have to determine whether or not we will make such a slashing of our tariff in the concessions granted to the United Kingdom as might imperil our industrial fabric.
I said quite frankly to the British representatives: We will make the reductions I have mentioned, then we will afford you at the appropriate time an opportunity of appearing before the tariff board to present your case and to ascertain whether or not the contentions put forward by our people are well founded. This would apply also to the matter of wages. For instance, I heard yesterday of a wage of forty-five shillings being paid in an engineering trade, just one-half the rate being paid in this country.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Richard Bedford Bennett: When the house rose I was pointing out that the tariff legislation enacted by this government in 1930 and 1931 was based not upon the desire to afford protection; for those who will look at the debates of that day will realize that in presenting the
tariff changes I pointed out that they were presented, not for protection, but to afford Canadian enterprise and industry an equality of opportunity with those who were pressing them to the wall. The legislation of that time was enacted for the purpose of affording that opportunity to Canadian enterprise and industry which we believed then and which we still believe its importance demanded.
May I point out further that last year we made provision for the appointment of a tariff board. It became apparent to me, after carefully considering the matter, that owing to the difficulty that would be experienced by any body of men meeting together in conference to determine what should constitute reasonable and fair opportunity for competition, it would be almost impossible for an agreement to be arrived at, and rather than make striking changes in the tariff we provided that:
His Majesty's government in Canada undertake forthwith to constitute the tariff board for which provision is made in the Tariff Board Act, 1931.
The principle upon which that tariff board will act, apart from what is declared in the statute itself, is contained in article 11, which reads:
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 case of industries not fully established.
That is a recognition of the doctrine of John Stuart Mill, and at the same time it is a fair and complete statement of what we conceive should be the principles that govern tariffs in this country, namely, that our own people should be afforded at least an equal opportunity with those who produce outside this country to compete for the home market as well as for their share of the markets abroad.
Then we provided that the findings of the tariff board, this fact finding body, should be laid before parliament so that the force of public opinion, for what it might be worth, would always be available for the purpose of making clear just what the situation was as disclosed by the report, and we provided that such action would be taken as the character of the report warranted.
We further agreed that we would not increase existing duties on United Kingdom goods until after an investigation and report by the board in accordance with the facts as found by that body, and further that United
954	COMMONS
Imperial Conference-Trade Agreements
Kingdom producers should have an opportunity of presenting their case to the tariff board.
During the course of the debate attention was directed to the fact that on a previous occasion I had asked the house why it was that those who lived outside of this country were permitted to come in and present their case to the tariff board. Under the circumstances that then existed I think that was the view entertained by many members on both sides of the house. Now, having established a board and having made it part of an international agreement, the agreement between the United Kingdom and ourselves, we have provided that inasmuch as it is to find the facts upon which action may be based, the fullest opportunity should be afforded to the other party to the agreement to present a case in support of any views which may be in the mind of the producers of the United Kingdom as to the necessity for any tariff we may have imposed.
The paragraphs relating to administration, some have said, are a reflection upon the administration of the Customs department of this country. I think that that has been amply dealt with, and I shall not do more than say this:	When Great Britain went
off the gold standard this country was confronted with the greatest crisis of its economic history. We had a pound which was valued for the purpose of the purchase of merchandise at a price that was not more than two-thirds of its par value. The customs tariffs of this country had been predicated upon a pound of the value of $4.86f. Now if there was any adequacy in the tariffs as passed, it follows that with the depreciation of the pound to the extent to which it had depreciated there was a wholly inadequate provision in our tariffs to afford an equality of opportunity to Canadian producers. So we had recourse to the provisions of the statute which enabled us to value for duty purposes imports coming into t-his countiy. We had also in our statute a further provision with respect to what was called the dumping currency duty.
Let me make clear to the house just what has been done. The pound had a par value of $4.86f. Immediately Great Britain went off the gold pound it was believed that there would be a rapid rise in commodity prices and in wages. I was waited upon by representatives of large importing houses who sought relief, under the provisions of our statute giving us power to impose dumping duties on depreciated currency, from what they believed would be a very difficult situation. I ventured to believe at that time, and so

expressed myself, that within a reasonable time a ten per cent increase in commodity prices would be all that would happen. I do not know that I had any very great reason for making that observation. But at any rate, deducting 48 cents from $4.86, leaves roughly $4.38, and we finally fixed $4.40 as the value of the pound for the purpose of dealing with it under the statute. It transpired, for some strange reason which economists have not been able to explain, or anyone else up to this moment, that instead of commodity prices and wages rising rapidly in Great Britain as expected, the rise was much slower, and has been and still is. The board of trade figures indicate that the increased value of commodities and of wages averages 8.8 per cent There has been a great decrease in wages, but the average figure furnished by the board of trade with respect to the rise in commodity values was only 8.8 per cent. Now we had based our figures on practically a ten per cent appreciation in commodity value. The dumping duty is the difference between the actual value of the pound, that is its value on the exchanges as fixed between New York and London from day to day, and $4.40. That is to say, if the average value of the pound for a period of fifteen days has been $3.80, the. difference between that and $4.40 fixed the currency dumping duty, which would be 60 cents on the pound. The house will see that the effect of that is that we have been more than fair; for having computed and estimated our duties on the basis of the par value of the pound, we have by arbitrary action reduced its value to $4.40, and provided that instead of the measure of relief that would be afforded by the difference between say an average of $3.80 and $4.86, the difference shall be computed between $3.80 and $4.40. As a matter of fact, the representatives of the British producers in this country expressed the view that it was not an unfair arrangement; that is, that having made our computations and arranged our fiscal system on a basis of the par value of the pound, we arbitrarily reduced it to $4.40, believing that the effect of England going off the gold standard would be to raise commodity values by substantially ten per cent.
We had that factor to deal with, and it is a factor that is still with us. I wonder if hon. gentlemen realize that in some instances the effect of the depreciation of the pound in this country is to render nugatory any provisions that there are in the tariff ait all. In some cases there is practically no tariff if you have regard to just the ordinary exchange value of



[Stage Direction]
United Kingdom
the pound. If in availing ourselves of the provisions of our statutes we are censurable for having done what we could to maintain the industrial and commercial structure of this country, then, of course, I can understand it. If, on the other hand, the government is not to be censured for availing itself of the provisions of a law designed to meet just such an emergency as that which has arisen, I think we are entitled to commendation. We have further provided that when conditions warrant it we will take the necessary action so far as these dumping duties are concerned, and we have protected of course the Canada-West Indies agreement of 1925 which has still some five years to run. This parliament and this government-although it is not the same parliament, and not the same government-we felt were bound in honour to protect the treaty obligation of this dominion extended to the West Indies, and we have made provision for it accordingly.
The provision with respect to the continuance of the agreement will be found in article 22. It is to last for five years, and then it must be terminated 'by six months notice after that time. To-night I am not going to repeat the argument I have already adduced as to why in the opinion of those well able to form an opinion, apart altogether from the government itself, the period of five years is not too long a time within which to test the efficacy of an agreement of this kind. In fact, when dealing with a purely empire agreement it might have been successfully contended that a longer time was desirable. If, for instance, in negotiating with the West Indies we believed it desirable to have a twelve year term, because it. was a family agreement, one might readily understand why in dealing with the mother country a five years term did not seem unreasonable. The same might be said as to the circumstances under which the agreement will continue in force until six months' notice has been given. At this moment I do not purpose to do more than to indicate, as I have already done, why the agreement was made and why it appears in its present terms.
Only yesterday my attention was directed to a great headline in a British newspaper stating that " Bennett and his lumber friends " dictate the policy of the United Kingdom. There are those in this country who, in the debate which took place upon the resolution -and possibly I am not strictly within the rules of the house in making this statement- contended that John Bull, and I am using the language of one of the hon. members opposite, has dictated to us what we should do. I use
these two illustrations because they indicate extraordinary points of view. In fact the right hon. gentleman who leads the apposition suggested that pressure had been used, and wanted to know whether or not the agreement had been signed under compulsion, or otherwise. It does seem to me that such a suggestion is foreign to the whole theory and practice of a conference, but I will not do more than say that the representatives of this empire convened in this city of Ottawa, discussed their difficulties, pointed out their desire to extend trade. We in particular voiced a wish to increase our export trade. As a result of that conference arrangements were made which were accepted by all. Those agreements are evidenced by our signatures, not to single agreements but to bilateral agreements whereby each community determined what was in its best interest. In the mutual interests of all the agreements were executed.
The agreement before the house is that between the United Kingdom and Canada, and the factors which influenced us in arriving at the conclusions I have indicated have, I think, been sufficiently set forth in the debate which has already taken place, and in my remarks this afternoon. I shall not longer delay the proceedings of the house, except to point out that in article 11 the word "shall" was in the original draft as printed. But by arrangement between the two governments, and in accordance with provisions contained in the agreement itself, the word "shall" has been changed to "may", and so appeals in the bill before the house.
In schedule E, item 210, in respect of "nitrate of soda or cubic nitre n.o.p." a new item 210e has been added, as follows:
210e. Nitrate of soda or cubic nitre imported by manufacturers of explosives for use exclusively in the manufacture of explosives in their own factories: free; free; free.
Although item 210 as set forth in the agreement carries the rates of free, 15 per cent and 20 per cent, the two governments, after consultation, have satisfied themselves that the United Kingdom is not in a position at the moment to supply Canadian requirements of nitrate of soda. But when it is in a position to satisfy Canadian requirements for all purposes the rate of duty will be as set forth in item 210.
Then, I direct the attention of the house to schedule F of the agreement, Canadian tariff item 784, "crude peanut oil, for refining for edible purposes, used as materials in Canadian manufactures." That item has been deleted entirely from the schedule. The de-
956	COMMONS
Imperial Conference-Trade Agreements
cision was made after consultation with the two governments affected. The item in question came into the tariff schedule under, shall I say, accidental circumstances, and as soon as it was brought to the attention of the two governments it was deleted. In the Ottawa Agreements Act, the title of the bill which passed the British House of Commons on November 3, the changes to which I have referred, in so far as they affect the agreement with the United Kingdom, have been made.
Without endeavouring to gloss over difficulties, to magnify advantages or to minimize disadvantages, I have ventured this afternoon and this evening to retrace part of the ground that has already been covered in previous discussions. I do so on second reading of the bill because schedule E set out in the bill is the only statement of the general principles with respect to the items now found in the ways and means resolutions in the hands of the Minister of Finance. He is prepared with his resolutions to afford every possible information to the house with respect to the volume of trade which may be affected, and the manner in which it may be brought about. Of course he will have to have the assistance of his technical officers. If hon. members opposite desire, as is their right, to record their vote against the second reading of this measure, I suggest that having done that the bill be passed with as much expedition as possible to its third reading, and that the ways and means resolutions be then taken up, because they cover not only those items set forth in schedule E of this agreement, but they also embody, in accordance with the provisions of our tariff, all the other items concerning tariffs that are dealt with in the other agreements with which reference has been made. If with the votes and proceedings before them, setting out fully the existing rates and the proposed rates in terms of the tariff legislation of the country, hon. members make such inquiries as they deem necessary, they can more fully appreciate and understand the tariff provisions of the agreements; and the Minister of Finance, as I have said, is in a position then to afford every possible opportunity for discussion of any or all of the items, as may be desired.
I have trespassed longer than I had intended upon the time of the house. I did so, however, because there have been some misconceptions which should be cleared up, and there were others which I thought should be exposed as being wholly unworthy of support. With confidence I commend the agreement to

the house as worthy at least of a trial during the period of time that is fixed; for it is my belief that within the four corners of this and the other agreements that have been submitted to this parliament lies the best insurance we can have of the return of that stable prosperity which it is the earnest desire of us all to see in this country.
William Lyon Mackenzie King: .Leader of the Opposition): Mr. Speaker, since the introduction into this house of the resolution respecting the Canada-United Kingdom agreement, we have had the opportunity of listening to three addresses of not inconsiderable length by the Right Hon. the Prime Minister (Mr. Bennett) with reference to that agreement. The first was at the time of introducing the resolution on which the bill before the house at the moment is based; the second was the address delivered on Thursday evening last in closing the debate which took place on the resolution; and the third is the address to which we have just listened on the second reading.
With respect to the address which the Prime Minister has given the house today, there are marked contrasts with his previous utterances; there is also a marked similarity.


Ernest Lapointe: More light and less heat.


William Lyon Mackenzie King: With respect to the contrasts, may I say that my right hon. friend's first address might, I think, have been described as very 'largely provocative. It was to some extent explanatory, but very largely provocative. His address on Thursday evening last was very largely denunciatory. The speech to which we have listened this aftemon and evening has been mostly explanatory and argumentative. May I say that I think it would have been more befitting one who presided over the great conference, and who hopes to have his name associated with legislation which will result *therefrom, had he, in his previous discussions and throughout this debate, adopted somewhat more the tone which he has adopted this evening.
May I, Mr. Speaker, say at once that I wish to take very strong exception to our being asked to pass the second reading of this bill without having had any opportunity of discussing in detail the several items in the tariff schedule which form a part of the bill, and which, as a matter of fact, constitute its main feature from the Canadian point of view. It is with reference to the Prime Minister's failure to make any reference to this side of

United Kingdom
the so-called bargain that I find the similarity in all the speeches he has made. In all of them he has dwelt at very considerable length upon what Great Britain proposes to give to Canada by way of what he terms concessions. He has said practically nothing with respect to the significance to Canada of the tariff changes proposed in the schedule attached to the agreement. These tariff items, had they been few in number and their significance easily determined, might have permitted of slight reference and treatment. But, as hon. members know, this schedule of tariff changes amounts to a revision of the Canadian tariff more extensive, certainly more serious, than possibly any other revision that has been made in the Canadian tariff since we have had a tariff. It is quite possible to compare in extent the present revision with the one by Mr. Fielding in 1907, and to some extent with the changes made at the time of the Dunning budget. It is at least comparable in extent with those great changes. It has this feature in addition, that it not only purports to make changes in the Canadian tariff with respect to Canadian tariffs peculiarly, but, as the Prime Minister himself has said, it is part of a new imperial policy, an imperial tariff policy. We are beginning an innovation in tariff affairs and in imperial affairs, by being asked to legislate on an imperial tariff. Notwithstanding this, we have had no opportunity whatever of discussing in detail the several items in the schedule: a schedule, may I point out further, which raises the tariff of Canada to heights considerably above the inordinate heights it had reached at the time the conference was held. It goes a step further. Not only does it raise the tariff to these greater heights, but it aims at doing something which has not been attempted before in any perceptible way; it aims at making a permanent tariff by rendering it impossible for this House of Commons over a period of years to reduce duties beyond a certain level. That Mr. Speaker, is a very great departure, and I submit that in those circumstances this House of Commons should have had, and ought still to have before it is asked to approve this agreement, full opportunity of discussing all these tariff items in detail. Tariff items are matters of taxation, and the control of taxation is the peculiar prerogative of the House of Commons. It is the oldest of the established rights of the commons to supervise all matters that pertain to taxation, and it is that right which at the present time we are being denied.
Now the Prime Minister has given to the house as a reason for proceeding as he does, that he is following the procedure which is
customary with respect to the introduction of tariff bills. He says that when the Minister of Finance brings in his budget, the new duties go into effect immediately. That is quite correct, but may I point out what takes place when the Minister of Finance introduces his budget? After introducing his budget the Minister of Finance presents to the committee of ways and means resolutions which embody all the changes that it is proposed to make in the tariff, and those resolutions are discussed in detail in committee of ways and means before any bill purporting to implement those changes is introduced. After the House of Commons has exercised to the full its right to discuss in detail all the proposed tariff changes which the Minister of Finance embodies in his budget, the Minister of Finance introduces a bill to confirm the proposed items of the tariff in the light of all the suggestions or modifications that may have been made.


Henry Herbert Stevens: That is precisely what
we are doing here.


Ernest Lapointe: We are not in committee, as the Prime Minister said.


William Lyon Mackenzie King: Perhaps the
Minister of Trade and Commerce will permit me to say that during the time the Prime Minister spoke this afternoon and evening he was not interrupted by anyone, let alone anyone on the front benches. I think the same was true of the Minister of Trade and Commerce when he was speaking. I ask, Mr. Speaker, that I be allowed the same opportunity to express the Liberal point of view in regard to this agreement as we accorded to hon. gentlemen opposite to express their view.


An hon. MEMBER:: What about last
Thursday?


William Lyon Mackenzie King: The Minister
of Trade and Commerce says that is what we are doing here. It is not what we are doing here; it is what we are told we may do after this agreement which includes the schedule of tariff changes has been approved by this House of Commons-an entirely different thing. Let me repeat, that when the Minister of Finance in connection with any tariff changes which he may introduce in a bill desires to get the approval of this house for those tariff changes, he first presents them in the form of resolutions to the house for its discussion in committee of the whole, where every item may be scrutinized, where full opportunity is given for discussion as to
958	COMMONS
Imperial Conference-Trade Agreements
the degree to which the proposed changes are likely to affect trade and like considerations, and where the amplest opportunity is given all hon. members to express themselves fully and the house to become fully seized of the significance of the changes. After that has taken place in committee of the whole house, and the resolutions have been approved, a bill is then introduced and the bill is given its first reading. It is then given second reading, and after the second reading all the items are discussed again with the possibility of amendment. After that stage has been passed the bill is given a third reading, goes to the other house and after passing through similar stages there, finally receives the royal assent. But what are we now being asked to do? The bill before us for second reading is a very short document. It has only three paragraphs; the first sets forth the short title, the last gives the government the necessary authority to carry out its provisions, and the second says that this parliament approves the agreement between the United Kingdom and Canada, which agreement embodies all these tariff changes. So we are being asked to approve all the tariff changes, which are entirely new and which affect our general tariff as against all countries as well as the preferences accorded Great Britain and the other dominions. We have to pass upon these without any knowledge of what they really are or what their effect is likely to be.
I say, Mr. Speaker, that this is not treating the House of Commons fairly. It is taking away from this house its oldest, most sacred and most fundamental right and duty, and it is doing that under a mere pretext and pretence. The Prime Minister and the Minister of Finance know that if there was the slightest desire on the part of the government to give the house an opportunity to discuss these matters, that could be done without violating any rule of the house and without altering the procedure in any particular. Before the house at the moment there are the resolutions before the committee of ways and means, which the Prime Minister says he hopes we will leave until everything else is disposed of, until after we have approved of the agreement and all that is in it. Then, he says, we can discuss these resolutions at great length. I say, Mr. Speaker, this house should be moved into committee of the whole to consider ways and means, and there we would be afforded an opportunity to discuss all the resolutions which have been presented to the house by the Minister of Finance. Then, when we have discussed these resolutions in committee and

have become fully seized of the nature of the tariff changes which are a part of this bill, let us return to the second reading of the bill and give our approval or disapproval of the agreement and the schedule of tariff changes embodied in it.
If that step is not taken-and even yet it is not too late for the government to take if-then with respect to a great inter-empire matter, with respect to perhaps the most far-reaching of all the steps that have been taken in regard to fiscal policy in the British Empire since there has been a British Empire, this House of Commons of Canada is being denied its oldest, most fundamental and most sacred right. That is, I submit, a poor way in which to try to build up any new system that is intended to make for imperial unity. I say it is a subterfuge of the worst possible kind. Under the guise of making an agreement between Canada and Great Britain with respect to trade, we are being asked to do what? We are asked not to make an agreement that is simply going to facilitate trade between Canada and different parts of the British Empire, but to make an agreement which for years to come is going to make increasingly difficult trade between Canada and the other countries of the world. That is the situation, and in the main that is the objection we have to this measure now before the house, and the wajr in which it is presented.
I want to make that very clear, Mr. Speaker. This legislation which we are being asked to approve will make increasingly difficult trade between this country and the other countries of the world. That is its primary object, and before I am through speaking this evening, I shall quote words direct from the lips of the Prime Minister himself in which he made the unmistakable declaration that the effect of this legislation would be to exclude the foreigner, and that this was the real purpose of the legislation now before us. I say that is a very serious step for a country to take, and it is doubly serious when it is taken in the dark as we are asked to take it at the present time. If for no other reason than that, I say it would be impossible for those of us who wish to respect the rights and privileges of parliament and to do our duty as representatives of the people in matters of the control of taxation and the like to think of supporting the second reading of this measure. We could not do so and maintain the traditions and rights of parliament which above all else w"e are here to maintain.
Now may I come to the speech of the right hon. Prime Minister cm Thursday evening of last week. I speak of that at once [DOT]because in that speech the Prime Minister

United Kingdom
sought to tell this house and the country what the principles of the Liberal party were with respect to matters of inter-empire trade. He undertook to tell the house what previous leaders of the Liberal party had stood for in these matters and what the policies were, and he lectured us upon not being true to our past leaders, and upon not being true to our principles. May I say to the Prime Minister that if he will confine himself to his own party and its policies, I think he will have quite enough to do. The last thing we would expect from the leader of the Commons and the Prime Minister of the country, let alone from the one who presided over the imperial conference, would be a deliberate misrepresentation of the position of any political party with respect to inter-empire trade since interempire trade became an actuality. And may I say that the last thing we would expect from any man would be an effort to misrepresent one who held a position second to no other in this country as the leader of a government and of a party, and to misrepresent that position when he whose memory all Canada so greatly reveres is not here to be heard on his own behalf. I am going to have something to say this evening, Mr. Speaker, about the references which have been made by the Prime Minister to the late Right Hon. Sir Wilfrid Laurier, and if the house will do me the honour of listening to a simple statement of the Liberal position as it is to be found in Liberal records, and as it is set forth in the utterances of the great Liberal leader whose name has been used so lightly by the right hon. gentleman opposite, I think they will soon discover that the right hon. Prime Minister is the last man entitled to claim, even today, to be a follower of that great leader.
What was the nature of the speech made by the Prime Minister the other evening? It reminded me of nothing quite so much as the nature of the campaign which he conducted in 1930. In all particulars the present Prime Minister ran true to form. He began by talking about the great betrayal, how leaders had been betrayed by their following, and how the following had been betrayed by its leaders. He spoke of betrayal three or four times during the course of his speech. I think we all still remember how he opened the conservative campaign in Winnipeg in 1930. In his remarks on the first night of the campaign he spoke of the great betrayal. He referred to the hon. members of the government of the day as a band of mercenaries, betraying all their principles. The following night speaking at Regina, he said the great betrayal had been
carried on for nine years; that it did not take Judas that long. That was the kind of language we heard from the present Prime Minister then the leader of the opposition, during the campaign. One can understand hearing it from him from a public platform during a political campaign, but I submit that we hardly had reason to expect it in this House of Commons from the leader of a government bringing in a great measure of fiscal reform.
How did the Prime Minister conclude his speech the other evening? He finished with a denunciation of all hon. members on this side of the house, telling them, in so many words, that they were voting not for principle, but in fear of the crack of the whip, that they stood in awe of their leader and did not dare to vote contrary to the way he voted.


Some hon. MEMBERS:: Hear, hear.


William Lyon Mackenzie King: Well, let the Prime Minister judge his own following in the light of those words, if he wishes so to do. May I tell him that, whatever view he may have of his own following, hon. gentlemen on this side of the house speak their own minds and stand by their own principles. What was the nature of his appeal? Exactly the same as the appeal made in 1930, when the right hon. gentleman visited different parts of the country and appealed to local prejudice of each-appealing to those who were apple growers by telling them that they needed protection for their apples; appealing to those in the mining industry on the ground that they needed protection for their industries; on the prairies appealing to the farmers by telling them that they needed and would receive something in the way of compensation for the protection he was giving to others; in the central provinces of Ontario and Quebec appealing to the dairy farmers on the necessity for protection on butter and various other commodities; to the textile and boot and shoe workers on their need for more in the way of protection; then down at the Atlantic coast appealing to the fishermen on the need of protection of the fishing industry. And so on back and forth all through the country, telling the great mass of people that, if returned to power, he would see that everyone would be supplied with w'ork-work for all; not doles, but work. This is the right hon. gentleman who speaks about betrayal, one who came into office on the promise that he would see that there would be an immediate end to work-


Some hon. MEMBERS:: Oh, oh.
960	COMMONS
Imperial Conference-Trade Agreements


William Lyon Mackenzie King: An immediate end to unemployment, rather. The necessity of work for the people was so much in my mind at the moment that that word slipped in where I should have used the word "unemployment." The right hon. gentleman said that, if he were returned to power, there would be work for all; work, not doles, he said; that there would be markets for the produce of the farmers; these he would blast [DOT] for them; that there would be old age pensions for everyone at the expense of the federal government; that there would be a [DOT] highway running from the Atlantic to the Pacific; that there would be public works everywhere. And now, after more than two years in which to implement those promises, what has happened? Not one of the promises has been fulfilled, on every one of them the people of Canada have been betrayed.
The other evening the Prime Minister, before the vote was taken, made an attempt at intimidation-an effort to browbeat and intimidate hon. members of the House of Commons on this side of the house. Think of the Prime Minister of a country adopting an attitude of the kind towards hon. gentlemen in a chamber over which he presides, asking one after another-Would he dare to get up and inform his constituents that he had voted against protection on apples? Would he dare to tell his constituents that he had voted against protection on fish? Would he dare to tell his constituents that he had voted against a free market for wheat? And so on, and so on. With an appeal to local prejudice, he denounced and sought to intimidate, one after another, hon. members on this side. Well, he got his answer. Some one says 48 of a majority. Well, the Prime Minister has told hon. gentlemen opposite in so many words, inferentially if not directly, just why the majority was what it was.
The only difference that I can see in the nature of the appeal, of the other evening and that of the campaign of 1930, was that in 1930 it was Canada first. Now, we have reached another stage; it is now empire first. The right hon. gentleman speaks of " the family"; we must 'take care of "the family." The agreement with respect to the West Indies and Canada was sacred because it concerned a part of " the family." But what did the right hon. gentleman eay with regard to moneys spent in trade in the West Indies? He said, " If a dollar goes to the West Indies which ought to have been spent in Canada, it might as well have been spent in the United States." That is how mutch he cares for " the family"; and, if we are to reason by analogy,

I suppose it will be precisely the same with respect to all other parts of the empire: every dollar spent in South Africa or in New Zealand or in Australia, every dollar spent in England or in Scotland, or in any other part of the empire, which might have been spent in Canada, might, from his point of view, as well have been spent in the United States. That is his view of the sacredness of " the family "- the money if not spent in Canada, might just as well, so far as the other members of the family are concerned, have been spent in the United States.
That, I think, fairly well summarizes the attitude of the rigfct hon. gentleman the other evening. There was one thing more, however, thoroughly characteristic of him, which disclosed that he was running true to form. He was not content to rest his case on the strength of the argument, on the strength of the proposition itself, on what advantage was going to accrue from the agreement to Canada and the empire. He had to go out of his way to make one of the meanest and most contemptible of personal attacks against the leader of the opposition. I have been reading over the words of my right hon. friend and I confess I have not had much difficulty in discovering how he came to use them; they were words which, everything considered, would come very naturally to his mind. He spoke of wounded pride, wounded vanity; he talked about resentment, about anger, about spleen, about not being too exclusively in the spotlight. Well, had the right hon. gentleman desired to reveal his own mind, his own feelings, he could not have taken a better way so to do. The Prime Minister seems to think that it is impossible for any man in public life to be actuated by motives of public service and principle. These considerations do not seem to enter bis mind. It is always some personal motive, some end of vanity to be served, some end of pride, some feeling of resentment, spleen in its many forms where someone or something has in some way crossed his path and must as a consequence be destroyed. That is all he seems able to think of when he comes to meet an opponent who happens to differ from him, be it only in matters of opinion.
May I say that, as regards any personal attacks which he may wish to make upon myself, he is most welcome to continue to make them. I doubt whether he could say more about me than he has already said. If he can think of any derogatory word in the vocabulary which has escaped him, which he has not already used in regard to myself, I shall be very glad to hear it.

United Kingdom
I would add it to the collection I have already of what he has said concerning me-a collection of which I feel somewhat proud, to tell the truth, because I do not think the Prime Minister would find it necessary to resort to language of this description did he not feel that there was a good deal in the arguments which he has been called upon to meet and has been unable to meet on their merits. If he lives very long, he will come to regret many times, many of the expressions he has used, and in no respect will he regret them more than in relation to this agreement with which he hopes to have his name associated as a great measure of imperial fiscal reform.
I will not take up more time with reference to the speech made the other evening, except to observe that the rest of it falls into two parts. The first was an effort to misrepresent from beginning to end the position of the Liberal party with respect to imperial preference and, in particular, the position of its leaders, and, above all, to detract from the great name of the Right Hon. Sir Wilfrid Xaurier.


An hon. MEMBER:: That is not true.


William Lyon Mackenzie King: Just a moment; my hon. friends will see that it is true. The other part of the speech was an endeavour to offer, or to appear to offer, some answer to arguments which were put forward from this side. It was not an answer to those arguments, as I think I shall be able to show.
In reviewing the history of the Liberal party with respect to preference, the Prime Minister began with the year 1S97. I am going to go back a year or two before that in order to give the genesis of the movement as it appears in the records of this house. I think I can show that, in the very first debate which took place in this house on the subject, there was a fundamental difference in the points of view of the two political parties with respect to the whole question of imperial preference, points of view which have been fundamentally at variance from the beginning until today, and which account for the -difference between hon. gentlemen opposite and ourselves at the present time.
I do not intend to follow the Prime Minister and say that his party has betrayed its principles. I will say that they are upholding today the principles which they enunciated in this parliament thirty and thirty-five years ago, but for which, during the course of that time, they never found it possible to get support. They would not have obtained support today had they proceeded in accordance with parliamentary methods and put before 53719-61
this House of Commons in the form of a tariff bill the changes in the tariff which they are trying to make under the subterfuge of an agreement with the old country.
In 1892, Mr. McNeill, then the hon. member for North Bruce, submitted the following resolution, which will be found on page 1555 of Hansard of April 25, 1892:
That if and when the parliament of Great Britain and Ireland admits Canadian products to the markets of the United Kingdom upon more favourable terms than it accords to the products of foreign countries, the parliament of Canada will be prepared to accord corresponding advantages by a substantial reduction in the duties it imposes upon British manufactured goods.
That was the Conservative policy with respect to preferences as originally enunciated, a policy which has been stated over and over again, and which it will be observed, is based not upon preference created by a decrease of customs duties, but upon an increase of customs duties-when the British parliament would increase its duties, then and then only something in the way of preference would be given by Canada to the mother country. That resolution was met by an amendment from the Liberal opposition, moved by the Hon. Sir Louis Davies. It reads:
Inasmuch as Great Britain admits the products of Canada into her ports free of duty, this house is of the opinion that the present scale of duties exacted on goods mainly imported from Great Britain should be reduced.
That resolution will be found on page 1623 of Hansard of April 25, 1892. There is shown the fundamental difference-a difference which ought to ibe admitted frankly and openly. Those who hold the views which hon. gentlemen opposite hold should be on that side of the house, and those who hold the views asserted by Sir Louis Davies ought to be on this side of the house. The view stated by Sir Louis Davies was that, inasmuch as we had a free market in Great Britain, inasmuch as she was our best customer-I think Great Britain was our best customer to the extent of taking five times the amount of commodities which we took from her-for those reasons, if for no other, we should be prepared to give her goods a certain preference in our markets by a reduction of our duties.
The preferences accorded from that day on took the form of a reduction of existing duties in favour of the United Kingdom and later on some of the other dominions. As I have said over and over again, until the conference of 1930, I do not believe there was one man in five hundred in Canada who ever thought of a preference being given in any

962	COMMONS
Imperial Conference-Trade Agreements
other way than by a reduction of duties, not one in five hundred who ever thought of a preference being given by increases in duty. Therein lies the difference between the protectionist point of view and the point of view of those who believe in freer trade. Because you stand for freer trade, it does not mean that in all circumstances, you favour absolute freedom of trade; it does mean, however, that, between the two extremes, there are those who believe -that it is to the interest of the consumer and of the producer in the great primary industries, and to the manufacturer as well, to have the costs of production and cost of living kept down, and that these ends can best be achieved by reducing duties and permitting more in the way of freedom of trade.
The right hon. gentleman has said that we have a great market in Great Britain for our manufactures. But -what is he doing by this very treaty? By increasing the cost of living, and by increasing the costs of production as he will by his further tariff increases, he is going to make it more difficult for the manufacturer in Canada, who may have any chance in the British market, to take advantage of that chance after his agreement has gone through.
In 1897 the Liberal government of the day introduced the policy of preference. The Prime Minister referred to this when he opened his discussion in these words:
Before I resume my seat I shall endeavour to make clear to the house just what the policy of the Liberal party has heretofore been, just what this new departure involves, and just why it has been made. This policy of imperial preference

That refers to the Liberal policy of imperial preference which was the one enunciated by Sir Louis Davies, that of reducing duties.
-or of preferential treatment of Canadian commodities in the British market-
Preferential treatment in the British market. How? By having Great Britain raise her duties; not by any exemption from existing duties, but by putting on duties where duties had not formerly existed.
-was a fundamental part of the teachings of Liberalism in the days of Sir Wilfrid Laurier.
In all his days, that was never a part of the teachings of Sir Wilfrid Laurier. Sir Wilfrid Laurier never said at any time in his life that as a method preferences should1 be given by the establishment of duties where duties had not existed before. His whole aim in the matter of preference was to help to bring down duties, and to make trade freer between different parts of the empire and between the em-

pire and other parts of the world. The right hon. gentleman continued referring to Sir Wilfrid Laurier:
In 1897, he and his minister of finance, speaking for the government, introduced into the house measures which provided for the granting freely of preferences to goods from Great Britain.
A perfectly straightforward, honest statement of fact.
What they said then was: What we give, we give freely,-
Still quite honest and straightforward-
-without compensation, without hope of benefit. No, not without hope of benefit. True, not benefit described in words, but the latent hope that some day the British people, realizing the great concessions that Canada had granted, would give to this country in turn the benefits it had bestowed upon them.
When Sir Wilfrid Laurier made his statement, he made it perfectly clear that Canada was doing what she did because she regarded Great Britain as her best customer; because she believed in keeping down the cost of living and the cost of production in the great basic and other industries of the country; and because she believed that exports could be paid for only by imports. She believed that if vessels were to travel to and fro between this country and the old land, they would have to be laden both ways, or the cost of transportation would be greatly increased. Hon. gentlemen talk as though trade was an exchange by which one party or the other was bound to lose. That is not the point of view which Liberals hold in the matter of trade. They hold that without mutual advantage there would be no exchange of commodities at all. The whole purpose of exchange is for one to give to the other, and the other to give to the one, something that is going to be preferable to what each already possesses.
But to follow it farther: Did Sir Wilfrid Laurier say that England would some day put up her tariffs, or that he hoped she would? Not a bit of it. What Sir Wilfrid said and repeated over and over again, was that, if *the day ever did come when Great Britain thought it well to Change her fiscal policies and place duties against Canadian goods, he believed she would recognize what Canada had done for her and would treat Canada in a similar way. And in that, Sir Wilfrid Laurier was absolutely right. May I say to hon. gentlemen opposite that I do not think there is a man living who knows the heart of Great Britain who would say that if there had been no conference at all, Great Britain would not have accorded to Canada of her

United Kingdom
own free will everything that is accorded by her under this agreement because of what Canada had done for her in the matter of preference over a long period of years.
What is the Prime Minister's next statement? That in 1897 the Conservative party did not believe that concessions of this character should be given for nothing. He keeps calling them "concessions" all the time. Again we have the conception that trade does not carry with it mutual benefit, that it amounts to doing something for one person and nothing for the other, which is an entirely erroneous conception. The Prime Minister is quite right when he says that Sir Charles Tupper opposed the measure and said that we should not do anything until Britain raised her tariffs. He said juSt what hon. gentlemen opposite are saying today. But Sir Charles Tupper also said that, by giving a preference to Great Britain, we would close up the industries of Canada in a very short time and destroy the industrial life of the country; yet the years which followed that utterance saw the greatest prosperity that Canada had known up to that time.
But the Prime Minister is not correct when he says that the Conservative view right along has been that we should not grant anything in the way of preference except for a preference in return. He said, "That was our policy; to that we have clung." What' about the years between 1911 and 1921, the years that Sir Robert Borden was in office, and the years the Right Hon. Arthur Meighen was in office? What was done about the British preference then? Did the Conservative party of that day end the preference because a preference in the British market was not granted, or did it continue the preference? Hon. members well know that the existing preference was continued throughout the whole period from 1911 to 1921. All the time the Conservative party has been in power, until the present Prime Minister assumed office, the view taken was that, as a matter of practice, the preference was being given by a reduction in duties, not by an increase in duties.
Now we come to the next period mentioned by the Prime Minister, the conference of 1902. The Prime Minister says that, at the conference of 1902, Sir Wilfrid Laurier did exactly what he is seeking to do at the present time. He would have us believe that Sir Wilfrid sought to insist that Britain should give a preference on wheat, and that circumstances then were similar to those of today. What is the position at the present time? Prior to the recent conference there was no duty upon wheat. The British government have now de-53719-61 i
cided to place a duty on wheat. But, when Sir Wilfrid Laurier attended the imperial conference of 1902, there was a duty on wheat, of, I think it was, two shillings a quarter. It had been imposed by the British government shortly after the South African war as a revenue measure. The duty was there on wheat when Sir Wilfrid Laurier went to England. At the conference Sir Wilfrid said to the British government that, inasmuch as Canada had been and was giving a preference to Britain, he hoped they would-what? Further raise their duties? Not a bit of it. But exempt Canada from existing duties, that they would lower or remove duties towards the colonies, as they were then called. Quite a different thing altogether; a point of view diametrically opposite to that being asserted today and in this agreement. Let me read the statement put forward by the prime ministers of the colonies at that time. It was as follows-I quote from the records of the colonial conference of 1902, signed by Sir Wilfrid Laurier and others:
That the prime ministers of the colonies respectfully urge on His Majesty's government the expediency of granting in the United Kingdom preferential treatment for the products and manufactures of the colonies-
Those are the dominions of today;
-either by exemption from or reduction of duties now or hereafter imposed.
There was no request at all for increased duties, thereby making trade more difficult with other parts of the world. But there was a request for preferential treatment for the products of the dominions "either by exemption from or reduction of duties now or hereafter imposed."
To be exact, the duty on wheat that existed at that time was threepence per hundredweight on imported wheat from all sources.
Speaking the other day the Prime Minister quoted the following:
The Canadian ministers stated that if they could be assured that the imperial government would accept the principle of preferential trade generally-
This was in 1902:
-and particularly grant to the food products of Canada in the United Kingdom exemption from duties now levied or hereafter imposed they, the Canadian ministers, would be prepared to go further into the subject and endeavour to give to the British manufacturer some increased advantage over his foreign competitors in the market of Canada.
Of what was that a declaration? The Prime Minister would have us believe that that was similar to what is happening today where duties are being put up in Great Britain, and are being raised in Canada in order to create

Imperial Conference-Trade Agreements
preferences. It was in fact diametrically the opposite. The view which the Canadian ministers took was that, if Britain would reduce her duties so far as Canada was concerned, we would seek to increase the British preference by a reduction of our duties in a manner that would be mutually helpful.


Robert James Manion: How could they reduce
duties in Great Britain when they did not exist?


William Lyon Mackenzie King: They did exist. My hon. friend has not been listening. The duty in Britain to which reference was being made was the duty on wheat which Great Britain put on after the war, and it was from that duty the Prime Minister of Canada was urging that Canada should foe exempted.
The Prime Minister went on to quote further from the records of that conference. He cjuoted the following:
As a result of the communications which have taken place, it is understood that the representatives of the colonies hereinafter mentioned are prepared to recommend to their respective parliaments preferential treatment of British goods on the following lines:
Canada. The existing preference of 33J per cent, and an additional preference on lists of selected articles-
Then the Prime Minister said:
Now, let me draw the attention of those in this house who have denied that Sir Wilfrid Laurier was prepared to establish his preference by putting a greater duty against foreign goods and letting British goods come in free, to these words:	_
(a)	By further reducing the duties in favour of the United Kingdom.
(b)	By raising the duties against foreign
imports, and	.	.
(c)	By imposing duties on certain foreign imports now on the free list.
The last two seem to give colour to what my right hon. friend has said, that in some instances Sir Wilfrid Laurier was prepared to increase slightly duties against other countries in order to give a preference. May I point out that, in taking into account what is there *stated and what is taking place to-day, one has to have regard to the level of duties as they were at that time and as they are today. It is one 'thing to make a slight upward change in a duty, a change which does not affect materially foreign trade. It is quite another thing to raise a duty to a point at which foreign trade is entirely prohibited. One has to consider the intent as a whole. The point to consider is the point of emphasis, and Sir Wilfrid Laurier stated very clearly that his whole purpose was primarily that of securing in the long run and as a net result a lowering of customs duties. lot me read

another sentence which follows at some distance in the Prime Minister's record of the proceedings but which we read in conjunction with the foregoing:
The Canadian ministers desired to have it understood that they took this course-
Why?
-with the strong hope and expectation that the principle of preferential trade would be more widely accepted by the colonies, and that the mother country would at an early day apply the same principle by exempting the products of the colonies from customs duties.
AH the way through, the reason at the back of everything done by Sir Wilfrid Laurier by way of preference sought or given was the lowering of customs duties.
That was at the conference of 1902. The Prime Minister went on next to discuss what took place in 1905. I beilieve he left the impression in the minds of hon. members that in 1905 the British government was negotiating with Sir Wilfrid Laurier with regard to a treaty somewhat similar to the one for which the Prime Minister of today claims authorship, at least in part. In support of what he had to say with regard to the discussions of 1905, the Prime Minister read from a volume entitled The Apologia of an Imperialist-forty years of empire policy, by Mr. W. A. S. Hewins. He made quotation after quotation from this volume-for what purpose? The quotations were made in an effort to have it appear, first of all, that negotiations in the nature of bargaining were being carried on between governments in office with the object of framing an agreement to alter the tariffs as has been done at the recent conference, and, secondly, that Sir Wilfrid Laurier was seeking to press the British government to raise its tariffs so as to create preferences, and was prepared to adopt a similar course in Canada. May I say at the outset that I think the Prime Minister would have been better advised if, when referring to the life work of Sir Wilfrid Laurier, he had quoted from Sir Wilfrid's own utterances as they are to be found in his many public speeches and, in the records of Hansard. Why, may I ask, did the Prime Minister not do this and instead seek to try to prove his contention from a volume entitled The Apologia of an Imperialist? Why did he quote from that volume to the exclusion of all others where Sir Wilfrid Laurier stood in the matter of preferences? Why did he cite for his purpose from that volume excerpts in the nature of conversations which were wholly confidential and carried on, not with 'regard to actual conditions, or situations which 'actually arose, but with respect to contin-

United, Kingdom
gencies which might arise? The Prime Minister well knew that Sir Wilfrid Laurier was no longer here where he could give the interpretation to be rightly placed upon his words. Nevertheless, the Prime Minister has chosen to select from this particular book portions which deal, not with Sir Wilfrid's public utterances, not with anything to be found in the public records of Great Britain or Canada, but with confidential conversations which took place at a time when matters were being discussed which were purely hypothetical in their nature, which were not actualities and which, as a matter of fact, never became such. They were just so-called conversations. But I shall go a step farther:	Had the Prime Minister
given to the house the full context of these conversations I would be less inclined to take the exception I do to the construction he places upon them. But he actually omitted the portions that did not suit his own purpose, and which give, when read in conjunction with the whole record, a meaning entirely the opposite of that which was given-and that in treating of the words of a great man who has passed away.


Some hon. MEMBERS:: Oh, oh.


William Lyon Mackenzie King: I do not
wonder that hon. members groan.


Some hon. MEMBERS:: Small potatoes.


Mr. MACKENZIE  ICING@: There is an old saying which by some might well be heeded at this time: it is that " of the dead we should speak nothing but good." I should like to know what could be more unworthy than to seek to put upon the lips of one who has gone, words which wholly misrepresent his position.
Before turning to Mr. Hewins' book, let me read an utterance or two of the Prime Minister which leads up to his quotations:
Then it has been said that the mere suggestion of the following of a given course constituted an interference w-ith the policies of the mother country. Before he left this world, while he was still in the plentitude of all his power, Sir Wilfrid Laurier in this very city urged upon Mr. Hewins, the representative of Mr. Chamberlain who came here for that purpose, that this policy should be pursued, and gave his reasons for it, as I shall presently show.
I ask hon. members to note the statement, that Sir Wilfrid Laurier urged, in this very city, upon Mr. Chamberlain's representative, a policy similar to the one the present Prime Minister is now advocating, note the word "urge"-and note the policy referred to. That policy was one whereby England should change her fiscal policy and raise her duties
in order to give Canada a preference, and that these results should be brought about by the bargaining process. The Prime Minister further said:
But before doing that may I point out that there came another conference. Before that other conference came, having failed to make any impression on the British people in 1902, Sir Wilfrid Laurier still desiring to secure something for Canadians in 1905, in this very city dealt with the problems to which I have referred. I have in my hand the first volume of Apologia of an Imperialist by Mr. W. A. S. Hewins, and you will find there if you take the trouble-and I commend to every member the reading of the first chapter-the record of his conversations with Sir Wilfrid Laurier, with Mr. Fielding, with Sir William Mulock and with Mr. Paterson.
I ask the house to note the expression, "having failed to make any impression on the British people in 1902." The Prime Minister asks hon. members to read what Mr. Hewins says. What does Mr. Hewins say about 1902? Let me read it. At page 8 of the introduction of the apologia I find the following:
The need of providing fresh revenue during the South African war lead to the imposition of the corn duty of two shillings a quarter in the budget of 1902. This was a treasury expedient, and rvas followed by the request from Canada for a preference in respect of that duty at the colonial conference of that year.
This was supported by Mr. Chamberlain and agreed to by the British cabinet

And the Prime Minister says Sir Wilfrid failed to make any impression!
-but during Mr. Chamberlain's absence in South Africa a change in the situation took place and the corn duty was removed in 1903.
Had the duty itself not been completely removed as against all countries, the result of Sir Wilfrid's representations, according to Mr. Hewins himself, would have been to obtain for Canada exemptions from these duties.
Now, what was the nature of Mr. Hewins' mission? Was he here representing a government with respect to an agreement which was being drawn up while that government was in office with a mandate to establish preferences? Mr. Hewins gives his own statement as to why he was here. It will be 'found in the introduction at page 9 and at 'page 115. Here is what he says:
Meanwhile, the government of Canada was revising its tariff, and to carry out that work had appointed a tariff commission under the chairmanship of Air. W. S. Fielding. It was extremely desirable that there should be mutual consultation so that the general lines on which investigations were proceeding in both countries should be understood. In July, 1905, preparatory conversations took place, followed by
966	COMMONS
Imperial Conference-Trade Agreements
a formal invitation to Mr. Chamberlain to send a representative to Ottawa to hold informal conversations with Canadian ministers. This was the origin of my mission to Canada in the autumn of that year.
Note those two phrases, "mutual consultation," and "informal conversations." That was all that Mr. Hewins was authorized to carry out on 'behalf of Mr. Chamberlain. Why was he acting for Mr. Chamberlain? Because Mr. Chamberlain was about to begin his great campaign of tariff reform. And may I point out that his campaign was a very different kind of tariff reform from what hon. gentlemen opposite are proposing. Mr. Joseph Chamberlain aimed at free trade within the British Empire. I do not know what Mr. Chamberlain would have thought if he had seen the tariffs to which the country is bound at the present time, as agreed to at this last conference. His policy was free trade within the British Empire in regard to all things, and he went so far as to say to Canada very plainly: If in giving preferences you impose duties against us, be they ever so high against other countries, no matter how low they may be, if they are still sufficiently high to keep any of our goods out, your preferences are no good to us one way or the other. Mr. Hewins himself makes it perfectly clear that he was concerned not with any bargaining process between governments engaged in actual negotiations but a process of mutual consultation carried on by confidential conversations. What did Mr. Chamberlain wish Sir Wilfrid Laurier to do? Mr. Hewins says on page 115, speaking of the instructions which had been given him at Mr. Chamberlain's instance:
He will please bear in mind that, according to my present view, the object which I have in view, in common with the Canadian government, can, in my opinion, be best served by the preparation of an "optional tariff" to be passed by the dominion parliament as a standing offer to Great Britain in return for specified concessions on our part.
He wanted to see if Sir Wilfrid would not pass an optional tariff as a standing offer to Great Britain. And what does Mr. Hewins record? That Sir Wilfrid told him that on no account would he pass an optional tariff for any such purpose. He makes it perfectly clear that the object in that particular was not carried out at all. Further on, at page 140, Mr. Hewins says:
When I arrived-
This was to meet Sir Wilfrid at a later time.

he said I was apparently waiting for some event which might occur in Ottawa. I replied that I had come to Ottawa to explain our side of the ease for preference.

Yet the Prime Minister would have left this house under the impression that these were negotiations in the nature of bargaining between the government of Great Britain and the government of Canada similar to those which have been carried on of late.
But, Mr. Speaker, here is where I take the strongest exception to the action of the Prime Minister. He read at some length-it will be found in Hansard-quotations from conversations with Sir Wilfrid in regard to the preference-


Ernest Lapointe: Presumed conversations.


William Lyon Mackenzie King: Well, I have no doubt they were actual; and are readily understood where the entire context is perused, and particularly where they are read in the light of an all important statement which appears in advance of everything recorded but which the Prime Minister left out altogether. It is in a paragraph by Mr. Hewins which appears in this volume, setting forth what Mr. Hewins felt should be kept in mind by Mr. Chamberlain and the British government with reference to Sir Wilfrid's attitude in considering every representation that he, Hewins, was making to the government as coming from Sir Wilfrid. At page 117 we find this:-and bear in mind in listening to it that the effort of the Prime Minister was to have it appear that Sir Wilfrid Laurier was prepared to try to interfere in British politics, interfere in the internal affairs of Great Britain, prepared to try to have the British government increase its tariffs in order to give Canada a preference. Mr. Hewins says at page 117:
There was no statesman in the empire whose position was more important to understand than that of Sir Wilfrid Laurier, Prime Minister of Canada, 1896-1911. In England there were at that time few who regarded empire affairs from his point of view. Strongly imperialistic as the mother country had become, especially since 1897, the "colonial view" of the empire still maintained its influence in government circles. Laurier belonged to the new age.
Extremely courteous, of great dignity, with a mind keenly appreciative of subtle distinctions, and an acute sense of the constitutional relations of the empire, his dominant motive was the greatness of Canada, its growth as a nation. His first thought was for Canada, and his attachment to the empire came not from any traditional affection for the mother country, but from his realization that Canada could obtain her highest development within the British Empire. He was jealous of anything likely to limit the exercise of her autonomous powers, and for the same reason unwilling to take any step whatever which implied interference with what he regarded as the internal affairs of Great Britain.

United Kingdom
Notice this last, Mr. Speaker, in considering Laurier's attitude and the traditional Liberal point of view:
He was jealous of anything likely to limit the exercise of her autonomous powers, and for the same reason unwilling to take any step whatever which implied interference with what he regarded as the internal affairs of Great Britain.
Note the words "likely to limit" as applied to the exercise of autonomous powers, and the significance of the word "implied" before the word "interference." What about the tariff agreements we have here, which on the one hand, as far as Great Britain is concerned, bind her in the matter of fiscal policy for a term of years, and bind this parliament in the matter of its fiscal policy for a term of five years?
What else does he say? On the next page he repeats so as to lend emphasis to his statement:
... nothing could have induced that statesman to intervene personally in what he regarded as the controversies of Great Britain,

Everything in this volume, including the conversations there recorded, must be read in the light of the statement there given by Mr. Hewins of Sir Wilfrid Laurier's position. Did the Prime Minister read this? Not a line of it. Here is something more which appears in Mr. Hewins's record at page 125-it too was not read by the Prime Minister:
The rest of the conversation was more general, e.g. the relations between the present movement and free trade v. protection, when Sir Wilfrid Laurier avowed himself a free trader, but recognized the case for duties.
And this is Sir Wilfrid speaking:
... he would go further and say that in his opinion Canadian manufacturers would develop most rapidly if there were complete freedom of trade between Canada and Great Britain. He said he was a free trader and he sympathized to a certain extent with the English free traders.
We did not hear much from the Prime Minister of that quotation from the volume of Mr. Hewins.
What did Sir Wilfrid say about each country having its own policy in the matter of trade and all else? I shall quote what Hewins says of that in a moment. The entire record shows that Sir Wilfrid Laurier and Mr. Hewins were simply exploring the field and considering all kinds of contingencies. Chamberlain was preparing for a general election-I pause to remind the house that this was in 1905-and in December, 1905, the government of Mr. Balfour, of which Mr. Chamberlain was a member, was defeated on this very question. The British people would not have the Chamberlain policy along the lines of preferences he was proposing, so there never was a chance for the government even to attempt a bargain. And for the next ten years the Liberals were in office in Great Britain. Mr. Hewins says on page 127:
I pointed out other reasons why a change of policy on the part of Great Britain was probable, independently of any action on the part of the colonies. I dealt especially with (1) the general influences which had undermined the position of free trade; (2) the attitude of manufacturers and their difficulties under the present system; (3) revenue considerations.
Sir Wilfrid Laurier went on to say that the result of a change might be that England would become more protectionist. Sir Wilfrid was warning Mr. Hewins against the government of Great Britain starting this protection business that England might become more and more protectionist. Sir Wilfrid saw very clearly what it would mean to the agrarian interests of this country once the protectionist movement got a foothold in England, just as we see and are foretelling what will be the results of the agreement of which hon. gentlemen apposite are boasting so strongly at the moment. Mr. Hewins goes on to record:
Buit that was our lookout and we had to decide what we would do and whether we would take the risk.
That was Mr. Hewins recording what Sir Wilfrid had said. It was for England to settle her own tariffs and her own policies. I quote Mr. Hewins again:
I said I agreed with him that complete freedom of trade between Great Britain and Canada would be best for Canadian manufacturers. But it was useless to pursue a merely speculative ideal. We had to consider concrete cases.
Sir Wilfrid Laurier said that was the way to do it and that at present preference might prove to be an inadequate reason for changing the policy of Great Britain.
Instead of trying to persuade Great Britain to change her policy, Sir Wilfrid was actually giving reasons why that course would be unwise. Mr. Hewins goes on:
I said we should change our policy anyhow.
Sir Wilfrid Laurier said that was all _ the better, that we ought to have a policy irrespective of the colonies.
In other words, no bargaining, no tying up the one to the other, but each with its own policy with respect to matters of trade and tariff. Again at page 132 Hewins says:
Sir Wilfrid Laurier said the objection I had stated was to some extent well founded and we should no doubt have to run some risk. It might happen that such would be the course of Canadian policy, and we ought to have a policy of our own.
968	COMMONS
Imperial Conference-Trade Agreements
Sir Wilfrid Laurier again emphasizing his opinion that Great Britain should have a policy of her own. The next sentence I wish to quote from Mr. Hewins immediately precedes what the Prime Minister quoted. At page 133 Mr. Hewins says:
I said, 'Suppose we give you this, what then?"
Sir Wilfrid Laurier said: "I will give you a schedule of manufactures admitted free into Canada."
The line Sir Wilfrid was proposing to take was the lowering of duties.
I said: "We are talking with perfect frankness and I wish to understand clearly what you mean. The preferential tariff will consist of a schedule of free goods? Will there also be included goods on which moderate duties giving the British manufactures a substantial preference are levied?"
Sir Wilfrid Laurier said: "Yes; free goods, on which duties are levied against foreign countries; other goods with moderate duties, in which Great Britain has a substantial preference."
That is exactly what the preference was all the time Sir Wilfrid Laurier was in power. He did not increase the duties; there were some cases of free entry and some cases of moderate duties, and there remained the general tariff against other countries. Then:
Sir Wilfrid Laurier:	"What course will
Chamberlain take?"
Sir Wilfrid was not urging Chamberlain to take any course; he was asking what his course would be.
I said: "This no doubt depends to a large extent on the result of my visit to Canada." Sir Wilfrid Laurier asked what he should do. I then said that he might give me a written assurance that having discussed the subject with me and having had the discussion of details with the commissioners, an arrangement such as he had described was practicable. Chamberlain should be able to make use of this assurance.
Sir Wilfrid Laurier approved.
That was the extent of the matter-"that an arrangement such as had been described was practicable." That was as far as Sir Wilfrid would go-that in the event of Great Britain changing her fiscal policy, in the event of her having tariffs, in the event of her giving Canada increased preferences, then Canada might increase her preferences to Great Britain. But of all this more was not to be said than that "an arrangement of the kind described was practicable." Sir Wilfrid would not go a step further. But what else did Mr. Hewins say?
Or, I said, there was a second course. Sir Wilfrid Laurier might publish an optional tariff next budget and bring it formally to the notice of the government.

That would be a form of bargaining.
Sir Wilfrid Laurier said this course was impossible; that the preferential tariff to be brought in then could only be the present one modified to meet the requirements of their revised tariff; and that he could not introduce an optional tariff such as I described. Nor would he in dealing with the government go beyond the resolution of the colonial conference. That resolution stood.
I have already pointed out that this resolution had in view only more in the way of preferences occasioned by the reduction of duties.
Now let me quote the words with which the Prime Minister ended his historical record, which he said was perfectly accurate. Here are his words as found in Hansard:
And then Sir Wilfrid Laurier asked what Mr. Chamberlain would do.
This was said iafter the Prime Minister had quoted extensively from Mr. Hewins. Sir Wilfrid Laurier did not ask what Mr. Chamberlain would do; he asked what course Mr. Chamberlain would take, which is quite different, the one implying that there had been some action which involved action of another kind iby the other party; the other implying independent action on the part of each.
The matter was further discussed with Mr. Fielding, and in the ensuing conference the efforts were made-[DOT]
I ask the house to pay attention to those words. What was the ensuing conference? There was no conference until 1907, two years later, none at all with Mr. Chamberlain or the government that was in office when Mr. Hewins came to Canada. In 1905 Mr. Balfour's government was defeated and a Liberal government came into office in Great Britain. That government made no effort whatever to create preferences nor did Sir Wilfrid or other ministers seek to have them do so, yet the Prime Minister says:
-in the ensuing conference the efforts were made, but Mr. Chamberlain passed away; the movement died; the free traders again succeeded to power, and you will recall that in the end Sir Wilfrid Laurier, wearying of the struggle that he had carried on to secure something in return for what he had given freely, found himself compelled in 1911 to abandon further efforts in that direction, and turned his eyes to Washington. There is the story-a story that cannot be denied, the story from the records themselves, the story of the policy of the Liberal party up to the day of the death of Sir Wilfrid Laurier.
In 1911, according to the Prime Minister, Sir Wilfrid turned his eyes towards Washington, having become exhausted in the struggle, and meanwhile Mr. Chamberlain had passed

United, Kingdom
away. Unfortunately for the veracity of the Prime Minister, Mr. Joseph Chamberlain did not die until July 2, 1914. He was very much alive when the Liberals succeeded to power in December, 1905 and when the conference of 1907 was held. ''The story cannot be denied" says the leader of the government, "'the story from the records themselves, the story of the policy of the Liberal party up to the death of Sir Wilfrid Laurier." That is the kind of thing the Prime Minister was giving this house the other night. We were told 'that Chamberlain had passed away, and that Sir Wilfrid Laurier found it necessary to turn his eyes towards Washington in 1911, whereas Mr. Chamberlain did not pass away until 1914-and this from the gentleman who presided over the imperial economic conference, and who now brings forward the measure which is to further fiscal reform throughout the British Empire.
When the conference of 1907 was held, what did Sir Wilfrid Laurier have to say? I am not going to quote further from Mr. Hewins' apologia, though I might find plenty to quote from that source. I will take what Sir Wilfrid Laurier himself said in this House of Commons prior to leaving for the imperial conference of that year. I refer to Hansard for 1906-07, volume 3, page 5538. This is what Sir Wilfrid said:
... we would not accept the idea that the British public should force upon us their own fiscal views and no more would they tolerate the idea that we should force upon them our own fiscal views, and therefore the only way in which the British Empire can be maintained upon its present foundation is by allowing to every nation composing it the measure of liberty that it has and also the free choice of the fiscal policy which iit is to maintain.
That is the choice which is being denied this parliament at this time by hon. gentlemen opposite, not only the choice to maintain a policy, but even the chance to consider or discuss it. Hon. gentlemen opposite do not even give us the opportunity to see what the proposed tariff changes really are and to ascertain what may be their significance before we are compelled to approve them in their entirety. They say: Notwithstanding that we will be in honour bound to maintain them for five years. We are to be in honour bound to maintain something the significance of which we have never seen, and never had a chance to discuss. We are to be in honour bound to raise tariffs far beyond anything recognized today as reasonable, and in honour bound to have them made permanent in fact for a period of years! Was there ever a suggestion so monstrous ?
The next conference to which the right hon. gentleman referred was that of 1923. That was one of the conferences I had the honour of attending. Just before I deal with that conference, may I say a word to the hon. the Minister of Trade and Commerce (Mr. Stevens)-I am sorry that he is not in his seat at the moment-touching upon his uncalled for reference to my part in the conferences of that year. Perhaps some of his colleagues will be kind enough to draw his attention to this. This is what the hon. gentleman said the other evening, as reported at page 301 of Hansard, with regard to my attendance at meetings of that conference. He first referred to the recent conference at Ottawa:
The conference then studied the question, and, unlike conferences at which my right hon. friend opposite represented his country, where it is reported that he did not attend the meetings at all but left this largely to his colleagues, the Prime Minister of Canada and his colleagues attended all the meetings, all the various economic gatherings.
May I remind hon. gentlemen that in 1923, there were two imperial conferences in England being held simultaneously. There was the imperial conference, so-called, dealing with the larger political questions, and there was the Imperial ecconomic conference. As Prime Minister of Canada at the time, I attended the opening and concluding meetings of the Imperial economic conference. I also attended when I was free to do so, some of the other meetings of the Imperial economic conference, but most of the meetings of the economic conference I could not attend for the simple reason that I was obliged to attend all the meetings of the main imperial conference, the imperial conference proper. As the records will show, I was present at every meeting of the imperial conference, at every meeting of iany committee or suib-committee of which I was a member, and I was present at the meetings of the Imperial economic conference whenever the imperial conference itself was not sitting and when as Prime Minister of Canada I was not obliged to be present thereat. My colleagues, the Right Hon. George P. Graham and the late Sir Lomer Gouin, attended the Imperial economic conference while I attended the main conference. These are the facts, and I say to the Minister of Trade and Commerce that he has not added many cubits to his stature by his unwarranted insinuation. It shows to where hon. gentlemen have been driven. They cannot defend a case on its merits; they resort, not merely to personalities, but to misrepresentation of the falsest kind.
970	COMMONS
Imperial Conference-Trade Agreements


Pierre Édouard Blondin: Order. I have so far refrained from interrupting the right hon. gentleman, but I must remind him that it is unparliamentary to accuse an hon. member of misrepresentation. Probably I have been remiss in my duties as Speaker1 in not having directed the attention of the right hon. gentleman to this fact earlier, but this is the third time in the course of his remarks that he has used the expression.


William Lyon Mackenzie King: May I say then that he is a four-flusher, Mr. Speaker?


Pierre Édouard Blondin: May I suggest to the right bon. gentleman that he is not doing himself justice in that retort to the Speaker. The other evening an hon. member drew attention to the fact that another hon. member had referred to him as a four-flusher. The statement had been made some days previously and I took the ground at that time that it was too late for the hon. member to dbject. The hon. member who had used the word complained of very promptly withdrew it. If it is necessary that I should declare myself on the question, then I say that notwithstanding what I may have said on the former occasion, I consider the word four-flusher unparliamentary.


William Lyon Mackenzie King: I am glad, Mr. Speaker, to hear your declaration that the word is unparliamentary, because the press has been hoping that Your Honour would so declare. Inasmuch as it is unparliamentary, I withdraw it, but I think Your Honour ought to have ruled at the outset that it was unparliamentary.


Pierre Édouard Blondin: I accept that criticism
from the leader of the opposition. Probably I should have ruled it unparliamentary at the outset, ju^t as tonight, during the remarks of the right hon. gentleman, I should have directed his attention to the fact that he was not using parliamentary language when he imputed misrepresentation to other hon. members. I would quote to the right hon. gentleman the words of May, 19th edition, at page 325:
The imputation of bad motives, or motives different from those acknowledged; misrepresenting the language of another, or accusing him in his turn, of misrepresentation; .... all these are unparliamentary, and call for prompt interference.
If there has been a mistake cn my part, it has been a want of promptness in interference.


William Lyon Mackenzie King: I am glad to
have Your Honour's assurance that misrepresenting the language of another is out of order also the imputation of bad motives. I wonder why Your Honour did not call the Prime Minister to order when in the course of his remarks he made the misrepresentations he did and such imputations.


Pierre Édouard Blondin: As to whether the Prime
Minister misrepresented statements on record made by others in the past, that is a matter of opinion. I am pointing out that it is laid down by the great parliamentary authority, May, that .it is unparliamentary to accuse an hon. member of the house of misrepresentation.


William Lyon Mackenzie King: I do not think hon. members or the country will have any difficulty in discovering who in this house has been misrepresenting the views of others.
May I come now to the conference of 1923. I wish to read what the Prime Minister said in regard to that conference. I will not take up the time of the house going fully into what was said in 1923, except to point out that the effort of the Prime Minister, in discussing the Imperial economic conference of that year, was to have it appear that, as the representative of Canada at that conference, I was seeking to do the same kind of thing that he alleges Sir Wilfrid Laurier was endeavouring to do when talking to Mr. Hewins, namely seeking to oause the British government to change its tariff policy and to give Canada a preference by the raising of duties. The Prime Minister made the following quotation from Mr. Neville Chamberlain's words in a letter to me:
We want you to tell us whether what we have proposed is going to help you, whether our proposals can in any way be improved, and if so, in what direction. That does not bind us to accept any suggestions that you make to us, any more than you are bound to accept any suggestions we may put to you as to what we might desire by way of increasing our trade with you: but it does give us the opportunity at any rate of realizing what the position is, and then it will be for us to say whether, consistently with the interest of our own people here, we can carry out what you have suggested to us.
That is exactly similar to the position that Sir Wilfrid Laurier took. At the conference of 1923 I took precisely the same position as Sir Wilfrid had taken on all previous occasions.
Now, let us come to the other part of my letter from which he quotes and see how fair the Prime Minister was, how eager he was

United Kingdom
not to misrepresent the point of view of anyone, let alone one of whom he was speaking at the moment. Having said:
Mr. Chamberlain's statement was then a "welcome overture", now it is the Dead March in Saul.
He proceeded to read from what I had said in my letter addressed to Sir Philip Lloyd-Graeme, which contained the quotations I have just read from Mr. Neville Chamberlain:
Canada has been the pioneer in the modern development of preferential trade within the British empire. She gave us the first preference to British goods in 1897-98 and took the initiative in requesting the abrogation of treaties which stood in the way of imperial preference. This policy she has steadfastly maintained. The Canadian preference now covers, in varying degrees, practically the whole range of competitive British exports to the dominion.
That is the end of the quotation. Then, speaking of myself, the Prime Minister says 1 then referred to what was granted with respect to the ten per cent discount on existing duties. He continued forthwith:
But before I proceed with this I should like to ask hon. gentlemen opposite to listen to the words of their leader in 1923 in England.
They happen to be words that immediately follow my reference to the ten per cent discount and which immediately precede the words which the Prime Minister continued to quote:
Coining specifically to the proposal of the Chancellor of the Exchequer that we state what preferential duties"-Duties!
_ I have shown how the Prime Minister jumped from what he was reading to the particular paragraph I have just quoted. He read the whole communication from the beginning to the end with the exception of this one paragraph which he left out. The whole communication will be found in the reference he gave, the letter of October 23, and I should now like to read to the house that part of my representations to the British government made in 1923 which the Prime Minister omitted to read. Remember the Prime Minister has led the house to believe that my attitude and representations at the economic conference of 1923 were on all fours with the position he took in negotiations with the British government at the recent conference here in Ottawa. The omitted paragraph reads as follows:
Canada has given preference in her own interest as well as in what she conceived to be the interest of the rest of the empire. It has never hitherto, in the case of the United Kingdom, been made conditional on the grant of an equal preference in return. We have at all times recognized the importance of conceding
to each government concerned the right to legislate as its own interests might demand, on tariff matters, or, in other words, complete control over its own fiscal policy. Should the British people decide at any time that it will be in their own interests as well as what they conceive to be the interests of the empire to make far-reaching changes in their present fiscal policy, Canada will naturally expect that in the establishment of a tariff, full and adequate consideration would be given, through preferential duties, to the interests of Canada's producers and to the substantial preference which Canada accords to British goods.
That is the paragraph which the present Prime Minister did not read when presenting my position to the house. That from the leader of the House of Commons towards one who also has held the office of Prime Minister and who happens for the time being to be leader of the opposition! Splendid chivalry; very noble!
Lest there remain any doubt as to what the Liberal attitude was in 1923, and what up to that time, it had been consistently all along, I should like to read a memorandum which I happened to have kept among my papers. It was given to me at my request by the Right Hon. Mr. Fielding before I went to the conference of 1923. I wrote Mr. Fielding as I did other of my colleagues asking if he would be kind enough to give me a memorandum which would set forth his views on matters likely to come up at the conference. Knowing that preference was to ibe one of 'the important subjects, I expected Mr. Fielding would outline the Liberal position on the subject and bring to my attention those matters which he felt I should have most in mind while in Bngland.
' Just here may I pause to say that I think it would be well for the business men and for the manufacturers of Canada to give heed at this time to some of the things for which the Right Hon. W. S. Fielding and the Right Hon. Sir Wilfrid Laurier stood. The manufacturers of Canada were never more prosperous than they were under the regime of Sir Wilfrid Laurier and Mr. Fielding. No one will say that Mr. Fielding did not take great care to safeguard the business interests of this country, or that he and Sir Wilfrid Laurier did not know as well as, if not better than, any other men living at the time the wisest course to be pursued in inter-imperial relations. We, younger men facing anew the problems which they had to face and contend with for so many years ought to think twice before we permit to be thrown over in wholesale fashion the teachings in inter-imperial affairs of these great leaders of political thought and action.
972	COMMONS
Imperial Conference-Trade Agreements
The following is Mr. Fielding's .memorandum:
With most of the subjects mentioned Canada is already dealing in her own way. I do not see how we can make any particular proposals concerning them. We should await the presentation of these subjects by others and then take them into consideration.
The desire for uniformity of legislation in some of these matters is natural. I am inclined to think, however, that in but few cases will uniformity be found feasible. Each dominion has its own particular conditions, which require to be dealt with, and the best interests of the empire can be promoted by leaving each section of it free to do what its own conditions seem to call for.
The most prominent feature of the agenda, I think, is that which is described as follows:
"Trade development. Questions relating to Imperial preference will be included in the agenda. In particular: (a) government of the Commonwealth of Australia have expressed the intention of raising the question of tariff preference accorded by the United Kingdom."
On this question Canada's position has repeatedly been made clear, and I do not see any reason why it should be changed.
When our preferential tariff was first adopted (1897-8), the Conservative party in parliament opposed it and held that preferences should be mutual-that Canada should not make any tariff concession to Great Britain without receiving a corresponding preference on Canadian products. At one stage, in order to have a clear expression of parliament, a resolution was moved in amendment to supply by Mr. Benjamin Russell (now' Mr. .Justice Russell) declaring the approval of the house of our preference to Great Britain. On this straight issue a division took place. Our government accepted the amendment and all our friends supported it. The Conservative party opposed it.
Our attitude has always been that the reductions of duties on British goods under the preferential tariff were granted in the interests of our own people. We had no objection to the granting of a preference by Great Britain, if she desired to allow it. Those in Canada who advocated a mutual preference had in mind preferential treatment of foodstuffs, which are our chief articles of export. Our government recognized from the beginning that a proposal to tax foodstuffs in England was not likely to be agreed to and that for us to press for such a tax would be a serious embarrassment to the public men of the mother country. We therefore refused to make reciprocal concessions a condition of our preference.
In later years the Conservative party practically accepted our position. They did not, during their term of office, introduce any change in relation to the British preference.
The test of the application of our preferential tariff has been the tariff conditions of the country under consideration. Our view has been that any British country having a low or moderate tariff should receive the preference. A case may be cited bjr way of illustration of this position. Our preferential tariff was established before the creation of the Australian commonwealth. At that time New South Wales was a low tariff country. Consequently, we granted our preference to New South Wales. Victoria, another large Australian state, was a

high tariff country. For that reason we did not grant our preference to Victoria. When the Australian commonwealth was created, a new tariff policy was adopted by it. It was higher than the tariff of New South Wales, possibly lower than the tariff of Victoria had been. But the tariff adopted was regarded by us as a high one. and therefore the benefits that had been granted by our tariff to New South Wales were cancelled. From that time to the present Australia has not been admitted to the benefit! of the preference.
For a long time the dominions received n( preference in Great Britain. In recent years a preference has been granted on a selected list of articles. We of course willingly accepted any preference so	granted,	but we	have	nothitherto demanded	and I	presume	will	not
demand as a right a reciprocal preference.
I do not think there is any other question on the agenda that calls for comment from my department. We have no grievances to present, no demands to make. What more can we do than await the proposals that come, either from the Imperial government or from our sister dominions?
That statement	by the	Right Hon.	Mr. Fielding may, I think, be taken as an accurate statement of the	Liberal	position	on	the
subject of preference. It will be seen from it wherein the Liberal position is diametrically opposed to that of hon. gentlemen opposite. When the Prime Minister said the other evening that we were betraying our leaders, and that his policy was the same as that of Sir Wilfrid Laurier and Mr. Fielding, nothing could have been farther from the facts.
Speaking of the conference of 1923, the Prime Minister made reference to a resolution which was passed in 1917. He said that he recognized in that resolution acquiescence in the idea of creating an economic unit of the British Empire. May I read what he said:
Sir. I have listened with amusement to the tales that have been told and the stories that have been unfolded with regard to the efforts the right hon. gentleman has said were made to create an economic unit of the British Empire. I have looked back through the books, and I find that the resolution of 1917 was the first resolution in which, before a conference of the empire, the thought was crystallized into words. Once more, those words are:
"All possible encouragement should be given to the development of imperial resources and especially to making the empire independent of other countries in respect of food supplies, raw materials and essential industries."
The other evening we heard the Prime Minister make the statement that I supported the resolution of 1917.


Richard Bedford Bennett: Hear, hear.


William Lyon Mackenzie King: He now says,
"hear, hear," and implies that I was thereby approving of tariff walls being raised around

United Kingdom
the empire. As I said last night, at the time I was most careful to inquire into the origin of that particular resolution and the significance of its meaning, and the meaning I attached to it and gathered from my inquiries was the one intended to be attached to it was that it meant more in the way of preferences in accord with the Laurier conception of preference. That I was right in this is borne out by the record of the conference. I have in my hand the record of proceedings of the imperial economic conference of 1923, and on the different pages therein is recorded the genesis and meaning to be attached to that resolution. It was the outcome of a resolution introduced originally at the conference of 1923 by the Hon. Mr. Bruce of Australia. 1 shall read in a moment Mr. Bruce's resolution as introduced. There was considerable discussion on it before it was adopted, and it was not finally adopted in the form in which Mr. Bruce introduced it. The Right Hon Stanley Baldwin was presiding, and I find at page 237 that the record reads as follows:
In the course of further discussion of the draft resolution moved by Mr. Bruce, the chairman said that he thought there was no doubt at all that the policy of preference was going to be a permanent one. He said: I think it is inconceivable that in any part of the empire the principle of preference, established and acted upon as it has been should not go for-ivard.
"Acted upon as it has been "-in other words, acted upon by reducing duties, not by increasing them. Then Mr. Baldwin continues:
In these circumstances, I think it is not only reasonable, but natural, that this conference should pass a resolution which sets out our collective opinion as to the need of imperial development and as to the value of preference m that development, and I can assure the conference that if that is the sentiment, we should not feel it a matter of any embarrassment at all.
After some discussion, the conference agreed upon a resolution in the following terms:
" This Imperial Economic Conference, holding that, especially in present circumstances, all possible means should be taken to develop the resources of the empire and trade between empire countries desires to reaffirm the resolution on the subject of imperial preference passed by the Imperial War Conference of 1917.
The resolution of 1917 is in the following terms:
The time has arrived when all possible encouragement should be given to the development of imperial resources and especially to making the empire independent of other countries in respect of food supplies, raw materials and essential industries. With these objects in view this conference expresses itself in favour of-
(1) The principle that each part of the empire, having due regard to the interests of our allies, shall give specially favourable treatment and facilities to the produce and manufactures of other parts of the empire.
That was in the conference of 1917.


Richard Bedford Bennett: There is another paragraph to it.


William Lyon Mackenzie King: I do not think my right hon. friend quoted it, but I shall quote it if he desires:
Arrangements by which intending emigrants from the United Kingdom may he induced to settle in countries under the British flag.
That is the other paragraph.
At the conference of 1932 the Right Hon. Mr. Massey, the Prime Minister of New Zealand spoke in regard to this very resolution of the conference of 1917. This, is what Mr. Massey said at the time as to the resolution. I quote from page 226:
Mr. Massey: I am going to take a little credit for what is happening. When I came here for the imperial conference of 1917, Mr. Bonar Law, who has passed away and whose death we all regret, was leader of the house. He was an enthusiastic supporter of empire preference, and, after consulting with him and one or two others, I drafted a motion and submitted it to the conference, affirming the principle of empire preference. It was referred to a committee representative of the different parties in the government at that time (because do not let us forget it was what was called a coalition government or a national government formed for the purpose of carrying on the war), and they gave it a great deal of attention. I can remember Lord Milner taking a very prominent part in connection with it as well as Mr. Bonar Law, but at all events it came back from the committee to the conference, where it was unanimously agreed to.
Do you notice, Mr. Speaker, that that particular resolution was referred to the national government of the day? The Right Hon. David Lloyd George was Prime Minister of Great Britain at that time. Does anyone here suggest that Mr. Lloyd George would have supported a resolution which he believed [DOT]meant the imposition of duties by the different countries of the empire against the rest of the world?


Richard Bedford Bennett: Hear, hear.


Mr. BOURASSA:: Mr. Lloyd George would support anything.


William Lyon Mackenzie King: My hon. friend 'from Labelle says that Mr. Lloyd George [DOT]would support anything, and the Prime Minister says "hear, hear." I do not agree with either of them, I am quite sure of one thing, [DOT]and that is that Mr. Lloyd George would
974	COMMONS
Imperial Conference-Trade Agreements
never have supported anything that could be taken to mean an increase of duties around the empire as a whole.
May I now go back a step further in the record and quote the resolution that was *moved by Mr. Bruce? I quote from page 219:
Mr. Bruce: The resolutions as I have drafted them are as follows:
This is the resolution that was the foundation Of the one that was carried:
Mr. Bruce: The resolutions as I have drafted them are as follows:
"(1) That the greatest economic development of each of the several countries and territories composing the British Empire is to be found in the promotion of their mutual trade, and in the development of the resources of the British Empire as a whole.
(2) That the further extension of the policy of imperial preference which was inaugurated by Canada in 1897 and which was accepted in 1917 by all the governments represented at the imperial conference offers the most effective means of achieving this end."
In other words, as stated by Mr. Bruce, the resolution of 1917 which had relation specifically to the conception of preference as it was introduced by Sir Wilfrid Laurier and as it had been supported from the Liberal point of view.


Richard Bedford Bennett: That is the one that was not passed.


William Lyon Mackenzie King: That is the
one that the Prime Minister of Great Britain says is the substance of the resolution which he asks the others to adopt.


Richard Bedford Bennett: That is the one that was not passed.


William Lyon Mackenzie King: I should think the Prime Minister had had enough say.


Richard Bedford Bennett: That is the one that was not passed.


William Lyon Mackenzie King: Is the right
hon. gentleman getting restless? Does he want a chance to talk?


Richard Bedford Bennett: As a matter of parliamentary right, Mr. Speaker, I am directing attention to the fact that the resolution which the right hon. gentleman has just read is the one that was not passed.


William Lyon Mackenzie King: I never said it was passed. I read the resolution that was passed and gave the genesis of it. I read also the resolution of 1917 which is the one the Prime Minister referred to, and it comes back to the Laurier policy with respect to the preference as laid down in this house.


Ernest Lapointe: The Speaker will name the Prime Minister.


William Lyon Mackenzie King: That brings
us down to the Prime Minister's reference to the conferences of 1930 and 1932. The reference which the Prime Minister makes to these conferences is rather interesting. He says:
Now we come to 1930 and 1932. Just one year ago this month I sent an invitation to every prime minister of every part of the British Empire, asking them whether they would come to this capital city of Ottawa to hold an economic conference, and as a result of that invitation there met here for four or five weeks, in the months of July and August, representatives from every part of the empire and, through the Secretary of State for the Colonies, representatives from the colonies as well.
There you have all the right hon. gentleman had to say about 1930

"now we come to 1930"; and I do not wonder that he did not say more. I think the recollection of 1930 must have been vividly in his mind at the time, and he was anxious to get away from them as quickly as possible. But, when he says that in 1932 the conference was the result of invitations that he extended for that particular conference, and seeks thereby to imply that the conference of 1932 had nothing to do with the fiasco of 1930, I would remind him of the words that he himself put into the lips of his Excellency the Governor General in the speech from the throne on March 12, 1931:
It is confidently hoped that, at the adjourned conference to meet at Ottawa during the ensuing summer, agreements will be concluded for closer empire trade.
And, at prorogation, in August, 1931, these words:
The Imperial economic conference, adjourned last November to reassemble at Ottawa during the latter part of the current year, has been postponed because of circumstances which prevented the representation at the conference of all the dominions of the empire. It is confidently believed that when this conference reassembles, an empire trade agreement of advantage to all its parts may be consummated.
The conference of 1932 was the conference of 1930 which had to be postponed for reasons only too well known. The conference of 1930 originated not with invitations from the present Prime Minister but with invitations from the government which preceded his in office. I have, I think, fairly completely reviewed the record of the Prime Minister's representations of the Liberal point of view with respect to preferences. I should hope that hereafter any hon. member who wishes to be fair in the matter will not endeavour

United Kingdom
to represent the policy of the present Conservative administration with respect to preference as being that of the Liberal party at any time, and in particular as a policy which Sir Wilfrid Laurier advocated at any time in his long and illustrious career.
I shall conclude by referring to but a few of the replies made by the Prime Minister to some of the arguments put forward when hon. members on this side of the house were setting forth the reasons as to why they could not support the agreement. First, he referred to higher tariffs; and here again amazing as it may appear, we find the Prime Minister seeking to have the Right Hon. Sir Wilfrid Laurier, who is no longer here to speak for himself, made the scapegoat for what, by subterfuge, he is now attempting to carry out. We find the Prime Minister actually implying that Sir Wilfrid Laurier would countenance and endorse what at the present time, under the guise of a trade treaty between the United Kingdom and Canada, amounts to the imposition of a tariff schedule which will operate in Canada to prevent trade with foreign countries, a schedule of customs duties higher than they have ever been, inordinately high, and which will be permanent for a period of years. The Prime Minister has this to say:
What are the reasons given as to why this agreement should not he supported? One says that the policy is still that of high tariffs. Sir Wilfrid Laurier said: Where you have industries created and established under conditions where all governments have supported tariffs, you must not lightly lay your hand upon the structure.
That is the answer to the objection which hon. members on this side of the house have taken to the fact that this agreement makes tariffs in Canada higher than they have ever been before.


Ernest Lapointe: When did the Prime Minister support Sir Wilfrid, anyway?


Richard Bedford Bennett: Do not interrupt.


William Lyon Mackenzie King: May I repeat that we all appreciate anything Great Britain may be doing through this agreement towards increasing in her markets opportunities for Canadian trade. Hon. members on this side of the house believe Great Britain would have taken similar action had there been no conference at all. So far as she has done it of her own volition, and not as a result of coercion, we have nothing to say. But to -the extent to which there has been interference by the government of Canada in the affairs of the United Kingdom or coercion may have been used to compel any clause of the agreement, or to the extent to which our
fiscal freedom is restricted as a consequence of the agreement, we are opposed to the agreement. When the Prime Minister states that hon. gentlemen on this side of the house are voting against the agreement because of certain duties in Great Britain, he entirely misrepresents our position. Let me repeat that there is no objection on the part of hon. members on this side of the house to Great Britain doing whatever in her own way she wishes to do. In so far as what she does may improve our opportunities for trade in Great Britain, we will be grateful; and, if we were in office, we would show our gratitude by helping to improve her opportunities for trading in Canada. We would do that in our own way, however, and in accordance with what we believe to be best for Canada, and not in a manner which would restrict in any particular the fiscal freedom of this country. We object to the Canadian side of the agreement; it is not a side for which Great Britain has been responsible. We object to the part played by the Prime Minister of Canada and his colleagues, a part which, I venture to say, they were never requested in any shape or form to play, namely, in raising still higher tariffs already inordinately high, and then after creating margins of preference, inserting in the agreement a provision that for a period of five years these margins of preference must not be changed.
Let us look at the Prime Minister's own statement as to the number and nature of the changes. He said, speaking at the time of the introduction of the resolution approving the agreement:
The 223 items above mentioned as those on which the empire trading margin is widened may be classified as follows:
Items in which the result is secured by:
(a)	reduction of the British preferential rate only, 81.
(b)	increase in the intermediate or general rate, or both, 89.
(c)	reduction in the British preferential rate accompanied by increases in the intermediate or general rate, or both, 49.
(d)	reduction in all rates, 2.
(e)	increase in all rates, 1.
(f)	reduction in British preferential and intermediate rates, 1.
And the worst of it all is that many of these increases represent increases in the intermediate tariff to the level of the general tariff, thereby preventing any possibility of Canada favourably negotiating agreements with foreign countries. I am going to show *in a few moments that those changes were not by chance but were intentional. I shall show by the Prime Minister's own words that there has been a deliberate effort on the part of the Prime Minister and his colleagues tc
976	COMMONS
Imperial Conference-Trade Agreements
make it difficult or impossible for Canada to negotiate trade agreements with other countries. There has been a deliberate effort to ensure that hereafter trade is to be confined very largely within the empire. Hon. members on this side of the house certainly want to trade with the different countries of the empire, but we also want to be free to trade with all the nations of the earth. I ask this House of Commons why we have been developing, during the last fifty years, our railways and our waterways, our vast transportation systems by land and sea, our harbours and other trade facilities? Why have all the agencies for communication and transportation been so greatly developed as well as our commercial services abroad? Are they simply to serve in the promotion of trade between Canada and other parts of the empire, or are they for the promotion of Canada's trade in all parts of the world? Are they after all the vast expenditures made upon them to be restricted to inter-empire trade, or are they, particularly at this of all times in the world's history, to be made available for trade with *all parts of the world? The London Economist, reviewing the treaty in a very careful analysis, has this to say:
Readers of our supplement-
And may I add that this publication last month devoted an entire supplement to an analysis of the agreement.
-will discover as one of the main features of the agreements the wide extent to which the dominions have had recourse to raising their tariff rates against the rest of the world in order to increase the margin of British preference. It is impossible, therefore, to claim that Ottawa has done anything in the direction of leading us towards the restoration of free trade conditions throughout the world. Its contribution has been in the opposite direction.
Elsewhere I find with special reference to the Canada-United Kingdom agreement in the supplement the following:
The effect is to raise still further the already inordinately high general tariff. . . iit is further to be observed that in many cases the intermediate tariff has been brought up to the general tariff level, thus impeding the_ possibility of negotiating successfully treaties between Canada and foreign countries.
As I have already pointed out, this agreement is made' binding for a period of five years. With respect to the several items of the tariff schedule:
All these have a fixed margin which cannot be varied for five years.
And then later on in reference to some of the items in the British schedule:
After all the years of struggle we have these agreements, with the fixed margin for five years. Some are fixed for three years.

May I say to the Prime Minister that I cannot understand why he or his colleague, the Minister of Finance, cannot be just as frank with this House of Commons as the Chancellor of the Exchequer and the Financial Secretary in England were with the British House of Commons. The statement was made quite frankly in England that, so far as the government of the day in that country is concerned having been a party to the making of it they will feel themselves in honour bound to carry out the agreement. They have said, however, and have made it quite clear, that the House of Commons is free at all times to change duties if it so wishes, and that it cannot be bound legally or constitutionally to maintain any tariffs or tariffs at any particular level. When the Chancellor of the Exchequer in England says that Great Britain is bound for five years only in that sense I say the Prime Minister or the Minister of Finance should declare to this house that, we are bound only to the same extent as Great Britain is. This parliament is perfectly free at all times to alter any duties that it may think it advisable to alter. As I repeatedly have said, if at any time we should be in office and decide that it is desirable in the interests of the country, and in accordance with the wish of the people of this country, that tariff schedules should be changed, we shall consider ourselves free, as those who believe in freedom in the matter of fiscal policy, to make such changes in the tariff of this country as we think necessary. I want to make that very clear, so that there may be no mistake about it now or at any time in the future.
The Prime Minister, speaking about the agreements being binding for a term of years, *cited a treaty made by Cobden and Gladstone in 1860 for ten years, and after saying they were the advocates of free trade, added *"we are only doing what they did." He would have .the house believe that, because *that treaty had been made for a period of *ten years, he is justified for like reasons in making this agreement for a period of five years. Again there is all the difference in the *world between what was being done then and *what is proposed now. The treaty Cobden [DOT]negotiated and which Mr. Gladstone's government carried through was an agreement, not to increase, but to reduce duties; it was an agreement in the direction not of making trade more difficult, but of making trade freer between Great Britain and France and between Great Britain and all other countries. I hold in my hand Morley's Life of Gladstone. Here *is what Morley says in regard to the particu-

United Kingdom
lar treaty which the Prime Minister cites as one which authorizes him to raise our inordinately high tariff still higher and which binds us to maintain many items of the tariffs at a level not below a certain height for a period of five years. At the time the *French treaty was negotiated the situation in *Europe was such that there was danger of an [DOT]outbreak of war between France and Great Britain, and that, as much as anything, was a reason for Gladstone, as he himself said, *taking the course he did at the time. But *he took it also because it was one of the *measures of fiscal reform which he was interested in promoting in order to gain greater *freedom of trade for Great Britain. Here is what Cobden says in a letter he wrote to [DOT]Bright albout the treaty. It will be found on page 21 of volume 2:
I will undertake that there is not a syllable on our side of the treaty that is inconsistent with the soundest principles of free trade. We do not propose to reduce a duty which, on its merits, ought not to have been dealt with long ago. We give no concessions to France which do not apply to all other nations. We leave ourselves free to lay on any amount of internal duties and to put on an equal tax on foreign articles of the same kind at the custom-house. It is true that we bind ourselves for ten years not otherwise to raise such of our customs as affect the French trade, or put on fresh ones; and this, I think, no true free trader will regret.
This as will at once be seen differs very widely from the arrangement made with Great Britain, which in many cases prevents us from moving the tariff in any direction except upward, and which ties us absolutely so far as other nations are concerned.
What are the facts specifically in regard to the treaty? They will be found at page 23 of volume 2:
France engaged to reduce duties and remove prohibitions on a long list of articles of British production and export, iron the most important, -"the daily bread of all industries," as Cobden called it. England engaged immediately to abolish all duties upon all manufactured articles at her ports, and to reduce the duties on wine and brandy. The English reductions and abolitions extended beyond France to the commodities of all countries alike. Mr. Gladstone called 1860 the last of the cardinal and organic years of emancipatory fiscal legislation; it ended a series of which the four earlier terms had been reached in 1842, in 1845, in 1846, and 1853. With the French treaty, he used to say, the movement in favour of free trade reached its zenith.
With that treaty the movement in favour of freedom of trade reached its zenith. But with this agreement between Canada and the United Kingdom the movement in favour of high protection reaches its zenith. We were 53719-62
told last night by the Minister of National Revenue (Mr. Ryclcman) that under the agreement the government was reducing the duties on spirits and cigarettes, and was going to lose on spirits alone some $8,000,000 or more of revenue; but the Minister of National Revenue could not tell us about any revenue the government was going to lose on anything affecting the food or clothing or shelter of the great mass of the people of this country.
I come now to the inimical effect of the agreement upon our foreign trade. It constitutes the very crux of the whole situation. I ask hon. members to listen to these words, and to carry them in their minds for the rest of their lives as representing what this particular agreement seeks to accomplish. The Prime Minister made the statement very clearly on Thursday evening last. I shall read his words from the report of his speech as it will be found in Hansard. Dealing with criticisms from this side, he said:
Another says that we have closed the doors of the world's markets, that we have shut out the foreigner. Sir Wilfrid Laurier said that that was one of the first things he was going to do if he got the British preference, and that is the one thing we have done.
Think of that, Mr. Speaker! We are going to close the doors of the world's markets. We have shut out the foreigner. Then to shelter himself the Prime Minister seeks to get under the aegis of Sir Wilfrid Laurier and dares to say that Sir Wilfrid Laurier sought to shut out the foreigner-


Ernest Lapointe: Shame!


William Lyon Mackenzie King: -Sir Wilfrid
Laurier, who after fifteen years of office went down to defeat on a great reciprocal trade agreement, the aim of which was to make possible more in the way of freedom of trade with a great neighbouring country! Yet the Prime Minister of Canada would have this house and the country believe that Laurier sought to shut out the foreigner! Well, Sir Wilfrid's life and record speaks for itself. There is nothing that the present Prime Minister of Canada can ever say that will add one iota to or detract one iota from the great name and fame of the Right Hon. Sir Wilfrid Laurier. I strongly repudiate the statement or the suggestion that Sir Wilfrid at any time in respect of any measure sought to make trade more difficult between this and other countries, let alone to close the doors of the world's markets or shut out the foreigner from ours. The Prime Minister, however, may speak for himself; notice his last, sentence: "That is the one thing we have

978	COMMONS
Imperial Conference-Trade Agreements
done"-shut out the foreigner. That, Mr. Speaker, apart from all else, is the reason why there is not one man on this side of the house who values Liberal principles and seeks above all else to be consistent with them who can be expected to support the second reading of this measure.
That statement, may I say, must be read alsfl in connection with another. It was made on Thursday last in this House of Commons. The other statement to which I refer was one made by the Prime Minister at Calgary where he spoke of the recent economic conference and its purpose. The Calgary Herald of September 6 has the following in its account of a speech made in Calgary by the Prime Minister on the previous day. He did not believe that the results of the imperial conference had yet been fully realized, or would be for some time. "One thing was certain, however, that nations outside of the empire would be asked to pay some tribute for the privilege of trading within the empire." There you have the position.


Richard Bedford Bennett: Hear, hear.


William Lyon Mackenzie King: The Prime Minister says "hear, hear," to that remark-nations outside are to pay tribute for the privilege of trading within the British empire, and we have closed the door against the foreigner. Now, Mr. Speaker, I hope the business men of this country, the manufacturers and producers, the exporters and importers, of this country, as well as the consumers, will appreciate to the full what that statement means.
The Prime Minister says that the policy is only a beginning. This is a new fiscal policy; it affects not only Canada but all parts of the British empire. What is its declared purpose? To shut out the foreigner. That is pretty serious. It is bad enough when one considers the effect on Canada alone of an attempt of the kind, but when one considers what the effect is going to be in the direction of possible retaliation by other nations, then and then only will we have a true perspective of its significance. When the effect of this policy on Canada's trade is seen, her trade with the orient, her trade with South America, her trade with Europe, her trade across the oceans of the world; when the effect upon our trade with the nations of the world is seen once they learn that the parliament of Canada has deliberately sought to shut them out of the markets of Canada; then I say that, if at that time, the present Prime Minister of Canada should be still in power there will be such an uproar from the people of this country that he will be obliged to vacate his office

I go a step further, and I say that we in this parliament had better think very carefully before we give up our national policies for any imperial policies which involve us along with other parts of the British empire in economic war. Economic war at a time such as the present will lead inevitably to hostilities between nations of the direst and most extreme kind. When we speak of the seriousness of a situation such as this the Prime Minister only laughs.
The Prime Minister claims that he has created an economic unit out of the British Empire, that he has made of the British Empire, through this arrangement, a great consolidation which is to shut out the foreigner and cause him to pay tribute in order to trade with any of its parts. Again I say, Mr. Speaker, I hope those living on the Pacific and those in the cities of the Atlantic coast will consider what this is going to mean to their ports. I hope those engaged in transportation, whether by land or by sea, will appreciate what this will mean to their enterprises as it still further adversely affects the trade of this country. I hope that the hundreds of thousands who are suffering in this country today because trade is so completely strangled and paralyzed will realize what it means when the Prime Minister of Canada says that the legislation he is passing through this house will make trade even more impossible than it is at present.
The implications of this agreement go far beyond any mere question of trade, far beyond anything in the nature merely of an economic issue. It affects the whole political future of this country and of the British Empire. It is a complete reversal of that for which, during the last few decades men of all parties, but more particularly members of the Liberal party, have striven in the evolution of the empire. At the diamond jubilee of Queen Victoria, Right Hon. Sir Wilfrid Laurier proclaimed in London that the future of the British Empire would be that of "a galaxy of nations," with each dominion enjoying full nationhood. For this he was proclaimed a separatist but his vision was clear and true. As a great political seer; he foresaw the inevitable trend if the empire were to endure. He pioneered the way in that development, and the day has come when even British statesmen have had to acknowledge Sir Wilfrid's foresight and leadership in the evolution of the commonwealth of nations as the empire is now more frequently described. The British Empire as a community of autonomous nations has found its legislative imprimatur in the Statute of Westminster which was passed

United Kingdom
within the year. But now, when this evolution has reached the point where we have a great community of free nations, so acknowledged by a statute of the British parliament, these gentlemen tell us that the bond of empire, which up till then was a political bond, has ceased to exist, and that we must seek to create in its stead some economic bond or tie which will serve to keep the general parts of the empire united and bring it to the form of a consolidated empire such as they have been seeking all along to bring about. The Apologia of an Imperialist, from which the Prime Minister has quoted, contains the record of forty years of endeavour on the part of the Tories of Great Britain and other parts of the empire to bring about an empire which would be in the nature of a great political and economic unit. They have failed to make it into a political unit; now they are striving to achieve the same end by making it into an economic unit, in which there will be imperial pollicies instead of national policies, and affairs of which apparently are to be managed by a cabinet of the combined executives of the different parts of the empire.
The Prime Minister apparently is unable to understand my reference to national sovereignty. Perhaps he has not seen a book but recently published by Mr. Berriedale Keith, the highest authority on the constitutional development of the British Empire, in which the author describes the evolution of the dominions from colonies to self-governing communities, and the evolution of the dominions from self government to national sovereignty. Now that we have achieved national sovereignty, hon. gentlemen like the Prime Minister are not satisfied. They are becoming restive, they want something which they believe to be greater still, albeit it is a reversion to a past and more dangerous order. By means of Imperial policies, as the Prime Minister describes this measure, they wish to create, instead of national sovereignties, an imperial sovereignty to which all the other nations of the earth will have to pay tribute, an imperial sovereignty which in the economic realm will help make impossible trade between the dominions of the empire and the other countries of the world. To my mind, Mr. Speaker, that raises the greatest question that has ever been raised in this parliament with regard to the future development of this country and of the British Empire of which it is a part.
The germ of all that is bound up in one of the three short sections of the bill now before us for second reading. In a word, Mr. Speaker, the issue has become one of "commonwealth
or empire." We believe in the British commonwealth as a community of nations free in their sovereign rights, free with respect to fiscal policies and all other matters, free to develop as they think best but in no way interfering with the autonomous rights of other parts. Hon. gentlemen opposite are seeking to create instead an empire, with imperial policies which ultimately will control all its parts from a common centre under an imperial sovereignty.
My right hon. friend says he will stand or fall by these agreements.


Richard Bedford Bennett: Hear, hear.


William Lyon Mackenzie King: I challenge him to go to the country upon this issue-


Richard Bedford Bennett: Wait till we pass the representation bill.


William Lyon Mackenzie King: -and we shall judge of his sincerity by the rapidity with which he accepts the challenge.


Joseph Henri Napoléon Bourassa: With the closing words and sentiments expressed by the leader of the opposition (Mr. Mackenzie King) I fully agree. With the beginning of his speech, in which he justified his opposition to the form in which these agreements are presented, I also agree. I will not be claptrapped into voting for the agreements, even if they have tacked on to them some amendment sponsored by my good friends to my left, as the whole Liberal party did a few days ago.
As the leader of the opposition rightly stated, this is perhaps the most important piece of legislation that not only this parliament, but any parliament since confederation has been called upon to consider. I refer not so much to the trade agreements themselves as to the implications and consequences which are bound to arise from them if they are carried through. Therefore, whenever I have a chance to record my vote against these agreements, against the principles on which they are based and against their possible consequences, I will so vote, right or left, with or against any group or party in this house. I am bound to take exception, however, to the history which the leader of the opposition endeavoured to give of the so-called British preference. I am the last man to stand and speak in this house who was an eye witness to the adoption of the policy advocated by the Liberal party, not only in 1897 but from the time of the great Liberal convention held here in 1893.
But before I take that up, may I venture to make an offer to my good friend the leader of the opposition and to the leader of
980	COMMONS
Imperial Conference-Trade Agreements
the government as well? If these two prize fighters will for once accept my humble umpireship, I will avail myself of my white hair to advise them to put a stop, if possible, to those personal debates and bickerings, which have multiplied themselves especially during this session, while the people of Canada are crying out, not for bantering words between two leaders but for action by the parliament of Canada.
Now I come back to the history of the Liberal party, in matters of tariff. As the leader of the opposition said this evening, the Liberals always have been in theory free traders; but in practice they acted as protectionists. It has been simply a question of degree as between the Liberals and the Conservatives. In 1893 I was present in the great rink here in Ottawa when we acclaimed one of the leaders of our party pledging his honour and that of all true Liberals in Canada, that once they came to power they would wipe out the last vestige of protection, because protection was nothing more or less than organized robbery. But when the year 1895 came, after the famous incident in the Tory party, which good old Sir Mackenzie Bowell called the "nest of traitors," the Liberals saw their chance of coming into power. Although they relied mainly on the sentiments of the people of Canada, they also required some material assistance in the way of electoral subscriptions; and therefore Mr. Prefontaine, Mr. Tarte and the late Senator Mackay went to some of the leading financiers and manufacturers of Montreal and asked for some subscriptions, whereupon they were told that the Liberal party must make a little change in its fiscal policy. So that when the Liberals had won the election, partly by prayers and partly with the money of the parties interested in the maintenance of a customs tariff, they preserved a sufficient degree of protection. They turned to the free traders of Ontario and of the west and said to them, "We have reduced the tariff on certain matters;" and then to Montreal and Toronto manufacturers they said, or whispered: "We have preserved the practice of protection, although we still stick to the faith and principle of free trade." But that was not all. They had to find a device whereby a further reduction in the tariff as against the world at large would be rendered almost impossible, and they fell upon the so-called British preference.
Now, time and again on both sides of this house, I have heard statements in regard to the British preference inaugurated in 1897-98. I was present in the house and, gullible young chap as I was, I voted for these measures.

But they were entirely different. In 1897 we offered and gave freely a reduction of the tariff, not only to the mother country for which the leader of the opposition sheds tears occasionally, but to all countries on earth that were prepared to give and were actually giving to Canada such trade advantages as would justify us in extending to them trade privileges. It was not a British preference. It was not an imperial preference. It was a reduction in duty on the part of Canada- to Great Britain for the reasons given to-night by the leader of the opposition, and to all other countries on earth who offered us equivalent advantages. The evidence is that automatically that preference applied to Germany, Holland, Belgium and various other countries that had concluded with Great Britain trade agreements under which the most favoured nation clause obliged us to give them the same treatment that we gave to the British.
Then came the jubilee of 1897. Mr. Laurier, as he was then, went to England, where he bathed in the atmosphere of imperial glory. Then he made those speeches in which he pledged the youth of Canada to fight all the battles of England, a pledge which was redeemed, without the authorization of parliament, in the month of October, 1899, by the government of Canada promising to take the money of the people of this country to help in the most infamous war that has ever been waged, according to the judgment of such men as John Morley and Edward Clarke, to name only two of them, one a Radical and one a Conservative of England. During that same year 1897, Mr. Chamberlain succeeded in making Sir Wilfrid realize, or at any rate imagine, that this preference offered to the world could be made the means of strengthening the bonds of empire. Therefore, at the next session, in 1898, true to his pledges taken in England, but contrary to his pledges given in Canada, Sir Wilfrid Laurier and his government made a tripartite or three-scale tariff: one for Great Britain, because of our love for everything British; one intermediate tariff for countries that might offer us greater trade advantages than Great Britain and the British Empire; and another for the rest of the world. Two years afterwards, in the fulness of the first fits of our imperial inebriety, our sons were dying on the veldt of Africa, to enable a pack of thieves to rob two small nations of their sovereignty in order to make some money by the digging of gold and the scratching for diamonds, thereby giving rise to the judgment-made public twenty or thirty years later by Lord Newton-of the ven-

United Kingdom,
erable Lord Salisbury, who deprecated the fact that the honour of England, its treasures and its blood were spent in order to make good the speculations of the most contemptible people on earth. But, of course, Lord Salisbury had to support a policy which he hated, just as the Liberals of Canada spoke in favour of a policy which they also hated. It was then that Mr. Fielding got my dear old friend Ben Russell to stand up in the house and raise his hands to heaven, glorifying Great Britain and the empire, saying, " Let us go further in our generosity to the poor little nation to the north of Europe; let the wealthy people of Canada give of their best to England and increase the preference from 25 to 33^ per cent." On that occasion, may I say frankly to my Liberal friends, I stood up and voted with the Tories against them, because I would rather vote for a cynical Tory protectionist policy than for a hypocritical Liberal free trade policy.
Now that I have finished this little bit of history, started by the leader of the government, not quite completed but prolonged by the leader of the opposition, as regards the British preference, may I add this much to prove to my good friends on the other side of the house that my sentiments are just as broad, so far as they are concerned, as they are towards those on this side? What the leader of the opposition said to-night is absolutely true; the Conservatives voted, and I voted with them in 1900, to condemn that policy, and they condemned it at every session from 1898 to 1911. Then they came into power in 1911, raising the cry of imperial loyalty and denouncing that poor little reciprocity treaty, which was innocuous. Hands off the British Empire 1 No truck or trade with the Yankees! Oh no; we were so loyal that if we shipped a few bags of potatoes to the United States, our British hearts and our fidelity to the British Empire would go with them! Thereby they secured the defeat of the reciprocity policy and of the government, this their main concern. They came into power and remained in power ten years; and during those ten years, they maintained untouched that policy against which they had voted, against which I had voted, a policy I denounced when the Liberals were in power and when the Conservatives were in power, a policy I denounce now, for the reasons which, once more, I will sum up in five minutes.
I have said that the so-called British preference was a clever device to redeem on the one hand the pledges given by the Liberal leaders to the farmers and the consuming community, that there would be general tariff reductions. It was a still cleverer device to
reassure the interested parties, on the other hand, that the general tariff would never be touched. I have said more than once in this house, and I repeat to-night, that the safest means by which Canada will remain a protectionist country is to maintain the policy which was inaugurated by the Liberals in 1897-98, and which they pretend to maintain and to increase. I repeat that, either as a Canadian policy or as an imperial policy, so-called, the preferential policy is the cleverest -I was going to say the most devilish-device to maintain the principle and practice of protection.
The leader of the opposition has made reference to the 'conference of 1902. I was a member of the house at that time, and my dear old friend 'Sir Wilfrid Laurier kept me informed of everything that went on. I followed closely the debates of the conference. Both the leader of the government and the leader of the opposition have forgotten one vital point which has some bearing on the matter. The leader of the apposition has said rightly that the duties then existing in England had been imposed as a war measure; but he ought to know, and I think he does know, that Mr. Chamberlain intended and endeavoured to take advantage of the conference of 1902 in order to convert that policy into a permanent policy. He succeeded in getting the agree-" ment of the Liberal representatives of Canada and the acquiescence of the other dominions, or colonies, as they were then called, to his attempt to force the English to accept as a permanent policy that which had been brought into being as a war-time measure. I am speaking extemporaneously, but my memory is pretty good in spite of my days, and I think this is borne out by the closing sentence of the memorandum which was signed by Mr. Fielding and Mr. Paterson. If my right hon. friends will read that memorandum I think they will find there a threat of retaliation by Canada unless Great Britain agrees to transform that policy into a permanent bargain. Mr. Fielding was a gentleman and Mr. Paterson was a kindly old man-by the way he was a brother-in-law of the last president of the Orange Free State. Neither of them used the forcible language used by the leader of the government last August-. I do not think any of the English representatives would have found an illustration of the temper of these gentlemen upon the ranch of the Prince of Wales in Calgary. Nevertheless, the threat was there and the warning was given that if the bargain was not fulfilled by the British government, the Canadian government would revise its policy. It is there in black and white for those who know
982	COMMONS
Imperial Conference-Trade Agreements
how to read and understand or, as we say in French, for those who read between the lines. What would have been the result, if their offer had been accepted? The result would have been to transform free trade England to a protectionist country as far back as 1902.
Do the leaders of the opposition and the government, do my Liberal and Progressive friends believe that if Mr. Chamberlain had carried out 'his so-called tariff reform policy in 1905 and granted preferences all around to the British dominions, the British dominions would not have responded according to the promises made by Sir Wilfrid Laurier? Had that happened, we would have been tied up thirty years ago to a policy which has been denounced right along by myself both in words and in votes, and by what little influence 1 can exercise in my little corner of this country.
The house is now being asked to pronounce itself in favour of the principle of preferential treatment, either as between Great Britain and Canada, or as between the various component parts of the empire. We are being asked to play into the hands of the interests of this country who want to preserve the general tariff high enough to protect themselves against foreign competition. We are also being asked to play into the hands of those who, as the leader of the opposition well said, desire to transform the British Empire into a replica- of the old Roman empire or of the German Reidh, These imperialists, by appealing to sordid interests, are endeavouring, under the pretence of trade, to put through principles of political and military unity which they could not get first hand.
This policy brought about Mr. Chamberlain's temporary defeat; but it has produced, this year, a victory of which the leader of the government is entitled to be proud from his own point of view. I am the last man to belittle his object, to belittle his person, to belittle his aims, to belittle his endeavours and his success; but let me tell him that as a Canadian, as a true lover of British institutions-I will not say that I am prepared to shed my blood for Great Britain; I will not take that pose because no one would believe me-I want our relations to last as long as possible; and that is precisely what this policy threatens.
I turn now to my right hon. friend the leader of the opposition and advise him to stand solidly upon the ground he took during the last fifteen minutes of his speech and Stop offering himself to the people of the empire as the future wet-nurse of poor old England.


Some hon. MEMBERS:: Hear, hear.
{Mr. Bourassa.]


Joseph Henri Napoléon Bourassa: But I say also to my Conservative friends: Stop posing before the people of Canada as being obliged to milk-feed for all time the suckling pigs of industry of this country. I say to the leader of the government, who is big enough, who is intelligent enough, to reach a position in the history of Canada never surpassed in the past: For heaven's sake, cease thinking about doing all you think you can do! Let him cease concerning himself about the policies of one-quarter of the population of the earth; let him not try to outdo Ghandi and Hertzog and Cosgrave and De Valera and all the other statesmen of the empire. He will govern Canada more effectively by remaining true to himself. I ask him not to be so much concerned about the disaster which will befall this country if the manufacturers who have fattened themselves at our expense for so many years, are forced to give back to the community a little of their ill-earned profits.
Mr. Speaker, I beg your pardon for the heated manner in which I have spoken. I have not spoken through any rancour, but with the sincere object of shedding the light of truth upon the somewhat distorted historical recitals we have heard during the last month.
On motion of Mr. Motherwell the debate was adjourned.


[Stage Direction]
At eleven o'clock the house adjourned without question put, pursuant to standing order.
Wednesday, November 9, 1932