OFFICIAL REPORT


[Stage Direction]
EDMOND CLOUTIER, C.M.G., B.A., L.Ph., PRINTER TO THE KING'S MOST EXCELLENT MAJESTY CONTROLLER OF STATIONERY 1948
[Stage Direction]
Tuesday, February 10, 1948


Mr. STANLEY KNOWLES (Winnipeg North Centre):: Mr. Speaker, I rise to a
question of privilege affecting the rights and privileges of members of this house. I shall be as brief as I can, without any detail. Last year, on July 14, the joint committee on printing presented its second report to this house. I refer to the report having to do with Hansard reprints. Concurrence in that report was not moved; consequently it was not approved by the house. Recently, however, hon. members have received from the king's printer a statement with respect to Hansard reprints, increasing the price and also decreeing that the recommendations of the report, which we have never approved, are now in effect. I submit, Mr. Speaker, that that is a breach of the rights and privileges of hon. members, and that either the Secretary of State or Your Honour should look into the matter.



MR. CRUICKSHANK-PRESS NOTICE OF SNOW IN VANCOUVER

Mr. G. A. CRUICKSHANK (Fraser Valley):: On a question of privilege, sir, I may not be quite as brief as the previous speaker, because we have had considerable publicity lately in Edmonton and elsewhere about the freedom of the press. An insult to the province of British Columbia and particularly to my riding has been published in the papers. I shall just read it:
Schools were closed in Vancouver, on Vancouver island and in the Fraser valley . . .
On account of snow. Mr. Speaker, I received a flower from my garden this morning.



MR. MITCHELL-EXPLANATION OF REMARK MADE IN DEBATE ON FEBRUARY 9

Hon. HUMPHREY MITCHELL (Minister of Labour):: Mr. Speaker, on a question of privilege, yesterday I made a remark during 5849-67
the course of the address by the hon. member for Cape Breton South (Mr. Gillis) which gave an impression quite contrary to what I believe. I was quoted as saying "That is not the story in the trades congress, and the hon. member knows it as well as I do". The hon. member for Cape Breton South had been talking about profits, prices and wage control and then of labour organizations being willing to co-operate with the government and myself and my remark made it clear that I discounted this. V hat I had in mind when I spoke was the stand of organized labour on wage control-that they were against it. I was not thinking about co-operation, which I must say now has been forthcoming at all times from labour organizations and which has helped greatly in better industrial relations generally. Because of the misapprehension, hon. members will note that I deleted the word "not" from the typewritten report of my remarks recorded on page 9S9 of Hansard. I thought I should make this statement in explanation.



BUSINESS OF THE HOUSE

[Stage Direction]
On the orders of the day:
Mr. JOHN BRACKEN (Leader of the Opposition):: May I ask the Prime Minister what work he intends to proceed with if the motion before the house is disposed of this afternoon?


Right Hon. W. L. MACKENZIE KING (Prime Minister):: We shall continue with the debate on the emergency measure today, and tomorrow and on Thursday the debate on the address, and on Friday we shall return to the emergency measure.


Stanley Howard Knowles: By "emergency measure" the Prime Minister means Bill No. 3?


William Lyon Mackenzie King: May I supplement what I have said with reference to continuing on Friday with the emergency measures? I have since been informed by the Minister of Finance that he may wish to ask the house to take some other measure on Friday than the emergency measure, and in that event we will try to arrange, between now and Thursday night, what will best suit hon. members.
Inquiries of the Ministry


John Bracken: I understood the Prime Minister to say that tomorrow we would proceed in committee with Bill No. 3.


William Lyon Mackenzie King: No, today.


John Bracken: I understood the Prime Minister to say tomorrow as well, and I had previously understood that tomorrow and Thursday were to be given to the speech from the throne.


William Lyon Mackenzie King: I am sorry if I did say that. I meant to say that this afternoon we would continue with the emergency measures, on Wednesday and Thursday with the debate on the address, and on Friday take up the emergency measures again. I am now saying that on Friday we may not take up the emergency measures at present being considered, but we shall seek between now and Friday to arrange either to continue the debate on the address or to take up some other emergency measure as may best suit the convenience of the house.


Mr. ADAMSON:: I understood the Prime Minister to say that it was the intention to proceed with a measure of the Minister of Finance on Friday instead of going back to the speech from the throne. Is it the intention of the minister to proceed with the gold measure, or some other matter?


Mr. ABBOTT:: I had not given special consideration to that, Mr. Speaker. The measure to assist the gold mining industry is on the order paper and it could be proceeded with at any time. It is not as urgent as some of the others, but perhaps we can give the question consideration between now and Friday.



SUGAR BEETS


[Stage Direction]
On the orders of the day:
Mr. J. H. BLACKMORE (Lethbridge):: I desire to direct a question to the Minister of Finance, based upon a newspaper report of January 12, 1948. The report states that on January 12 was announced the 1948 increase in price for tomatoes, peas for canning, sweet corn and green beans, crops which compete with sugar beets in the labour market. In the light of these facts, will the minister tell the house when he will make known what increase the government will render possible to producers in the price per ton of beets for sugar making in 1948?


Douglas Charles Abbott: The hon. member for Lethbridge was good enough to give me notice of the question and I can best answer it by repeating

the last paragraph of the statement I made on November 3, 1947, when sugar rationing was abandoned. The paragraph reads:
The government does not propose to subsidize the production of sugar beets in 1948, nor does it propose to sell imported cane sugar on a subsidized basis. Beet sugar may therefore be expected to sell at prices in line with average laid down duty paid costs of imported cane sugar.



PRAIRIE FARM REHABILITATION


[Stage Direction]
On the orders of the day:
Mr. E. D. FULTON (Kamloops):: The
Minister of Agriculture has tabled a copy of the report of the administration of the Prairie Farm Rehabilitation Act. Is it intended to have that report printed, and if so, will it be available for distribution to members? If that was not contemplated, will the minister arrange to have the report printed?


Right Hon. J. G. GARDINER (Minister of Agriculture):: I will inquire into the
matter. I am not certain whether it will be printed or not, but I will look into it.



FLAXSEED-CATTLE REQUEST FOR ANSWERS TO QUESTIONS ASKED ON FEBRUARY 9

[Stage Direction]
On the orders of the day:
['We do not want to violate it, but we do want to set an example. As I have said two or three times, the amount of business is negligible, whereas the benefits to be got from this restrictive program are tremendous.\nProgress reported.']
Mr. LEWIS MENARY (Wellington North):: Through you, Mr. Speaker, I would
like to ask the Minister of Trade and Commerce, or, in his absence, his parliamentary assistant, to take notice of my questions of yesterday, page 986 of Hansard, relating to flaxseed and cattle, and answer them.


Right Hon. C. D. HOWE (Minister of Trade and Commerce):: My	parliamentary
assistant advises me that the statement in answer to the question is not ready. It will be given tomorrow or as soon as it comes to hand.



[Stage Direction]
On the orders of the day:
Mr. J. G. DIEFENBAKER (Lake Centre):: I should like to direct a question to the Minister of Trade and Commerce. Is he in a position to advise when participation certificates covering the 1945 and 1946 crops will be paid?


Clarence Decatur Howe: My hon. friend is
aware that no increase in the initial pay-

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ments from the five year wheat pool can be made without an amendment to the wheat board act. The amendment has been prepared and will be on the order paper within the next few days. I am advised by the wheat board that payments can be made promptly after that amendment is approved by the house. Participation certificates for the 1945 crop are already in the hands of the wheat board, and cheques will issue, I am told, over a very short period as soon as the legislation is passed.


PETROLEUM PRODUCTS
[Stage Direction]
"prince Edward"
On the orders of the day:
Mr. W. CHESTER S. McLURE (Queens): In view of the short supply of fuel oil, as per statement made a few days ago, I desire to direct a question to the hon. the Minister of Transport. Is there a sufficient quantity of fuel oil in storage at Borden and Tormentine for the ferry steamers Abegweit and Prince Edward on the Borden-Tormentine route for the winter and spring seasons of 1948?

[Stage Direction]
On the orders of the day:
Mr. W. CHESTER S. McLURE (Queens): Seeing that I did not get an answer to my previous question I will try another one. I desire to direct a question to the hon. the Postmaster General, or the Prime Minister, or both. Is it the intention of the government to set up a special committee of the house to study the problems of the rural mail couriers in order to give these most faithful servants a living wage?
Hon. ERNEST BERTRAND (Postmaster General):: It is not the intention of the government to establish a committee, but as I said before, a bill will be brought in to give authority to make further supplementary payments.


APPOINTMENT OF SPECIAL COMMITTEE TO INQUIRE INTO PRICE INCREASES AND MATTERS PERTAINING THERETO
[Stage Direction]
The house resumed from Monday, February 9, consideration of the motion of Mr. Mackenzie King that a select committee be appointed to examine and report on the causes of the recent rise in the cost of living, and matters pertaining thereto.
5849-67§
Mr. T. J. BENTLEY (Swift Current):: When the debate was adjourned last night I was mentioning that when Canada developed a shortage of United States dollars, the government acted rapidly to take some corrective measure. When however Canadian citizens are faced with a shortage of Canadian dollars the government considers that a powerless committee is a good enough answer to this house and to the country. By their actions in these two matters they invite the suspicion that there is an ulterior motive, and possibly Mr. Warren Baldwin, writing in the Globe and Mail on January 9, 1948, hit on that motive. Mr. Baldwin has this to say, and I quote from a press dispatch of that day in the Globe and Mail:
Plans crystallizing here to take care of Canada's physical contribution to the still hypothetical European recovery program are predicated on a greater degree of austerity than is yet being practised by the Canadian consumer ... the Canadian public will be expected to produce an exportable surplus by cutting down on domestic consumption . . . counting on the rising costs of living in Canada to assist by cutting down the present spending spree . . . This principle applies in the food field itself... If higher prices themselves fail to take care of the situation it may be that other forms of pressure will have to be used.
And further on he says:
There are at least some members of the government who are finding it hard to shed very many tears at soaring prices so long as it contributes to the goal which it is expected the United States will demand that Canada achieve.
I suspected, and apparently he suspects, that Canada is being sold to the United States, and neither Canadian citizens nor this house of parliament know what the terms of the sale are. We only know the end result so far, and that is the high cost of living. I consider this method a rather cruel way of reducing consumption. If in order to play our proper and honourable part in assisting Europe to recover it is necessary to reduce our consumption, then every Canadian should make a sacrifice, and equality of sacrifice cannot be achieved by allowing prices to rise to a point where our less fortunate citizens are forced by economic pressures to do without many of the basic necessities of life. That equality of sacrifice can only be achieved by some form of rationing, and1 we have suggested the im>-position of price controls and the payment of subsidies as expedient and more practical than straight rationing, although even that may be necessary for some articles.
The payment, of subsidies will require the imposition of the excess profits tax, and I can see no hardship to corporations in that imposition. We have already had put on the record here some of the profit increases by
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many corporations. I want to quote a few more just to emphasize what I mean when I say that no hardship will result to the corporations by the imposition of the excess profits tax.
These figures are taken from the Financial Post of November 15, 1947, and have been quoted before during this debate. In 1945 the Simpson Company had a profit of $1,425,858. In 1946 their profit was $3,656,851, an increase of S2.230.993, or 156 per cent. That was a substantial increase in one year, which I believe was quite unnecessary. Zellers increased their profits in 1946 over 1945 by $231,967. Dominion Stores increased their 1946 profits- over 1945 by $456,116. Loblaw Groceterias increased their profits in 1946 over
1945	by $566,668. Canadian Bakeries, while they are apparently a smaller concern, increased their 1946 profits over 1945 by $71,669. Canadian Canneries increased their
1946	profits over 1945 by $697,144. The Borden Company increased theirs by $7,487,034; Silverwood Dairies increased theirs by $263,754; H. R. MacMillan Export Company alone increased theirs by $1,097,075. I gave the figures for Massey-Harris last night, and there are more figures here with which I shall not weary the house. I submit those only to emphasize again that I do not believe any hardship will result to these corporations by the reimposition of the excess profits tax.
Again, if these extra profits had not been made in 1946-and undoubtedly they will be still higher in 1947, according to all accounts we see in the papers-they could have been handled in one of two ways by the companies themselves. They could have been used to reduce the costs of the manufactured article, or they could have been used to increase the wage to the workers of those industries. As those corporations did neither, I see no reason why the government and the public should not have the benefit of those profits as a redistribution of income when there is low purchasing power on the part of many of our citizens, in order to level off the income in these days of high prices.
I know that some people will say that those increases in profits are not from profiteering. They will say that it was increased business which made them possible. That is a possibility; I do not deny it. But I have been listening for a good many years to certain types of advertising by businesses in this country, by means of which they drill into the mind of the consumer and the customer that volume cuts cost. If the volume of their business increased to the point where their profits increased as I have indicated by the

figures I have quoted, obviously the volume did cut cost; and somehow that cut in the cost should have been handed on to the wage earners, the consumers, or to the public treasury. These are the reasons why our leader early in the year gave voice to the six-point program he proposed, all based on the things which we believe and which have been supported generally in the speeches from this, the C.C.F. section of the house.
Our leader asked for the following measures: reimposition of price control; renewal of the subsidies on a number of things; the closing of the Winnipeg grain exchange, which could be done; reconstruction of the wartime prices and trade board-while it may be a big job, it is not impossible; continuation of the excess profits tax after December 31, 19*47, and rationing, if necessary, on some essential commodities. In spite of the courageous speeches made by members from the other side of the house, including the hon. member for Eraser Valley (Mr. Cruickshank), the hon. member for Spadina (Mr. Croll) and, I believe, the hon. member for Terrebonne (Mr. Bertrand), the government has made it clear that it will not even give consideration to the imposition of price controls, the continuation of subsidies, or the imposition of the excess profits tax. That makes me wonder what the government hope to accomplish by the setting up of this committee. Do they expect a miracle, Mr. Speaker? I am sure they do not want it. It may happen.
The hon. member for Macleod (Mr. Han-sell) cited four things which would not be done; and if none of those four things is done, the committee will serve no purpose whatsoever except to provide a place in which members may spend their time instead of being here in the house or somewhere else. The chances against the miracle are great, because the committee is to be watched over by the eagle eye of a cabinet minister who will want the government policy-which is to discover nothing-carried out. He will be ably assisted by partisan members who will be equally subservient to government requirements.
The vast majority of Canadians have already said that they want price control. Let us see what the farmers have to say. I have here a leaflet containing the resolutions adopted at the fourteenth annual convention of the British Columbia federation of agriculture. This resolution, among others, was passed:
Whereas president H. H. Hannam of the Canadian federation of agriculture has issued a call to action to all member bodies of the federation, urging a nation-wide campaign of petitions, telegrams, delegations to members of parliament, and protest meetings, designed to

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press the government for the return of price controls on grains, feeds and feed ingredients, and the restoration of subsidies at the coming session of the House of Commons;
Therefore be it resolved that this 1947 convention of the British Columbia federation of agriculture commend our national body for this action and pledge our wholehearted support towards the realization of a powerful and effective protest campaign, and
Be it further resolved that, in order to strengthen and co-ordinate the campaign, regional conferences shall be called throughout the province as soon as possible, representatives-
And so on, with the idea of promoting that particular plan.
I think the members of this particular group and others have indicated quite clearly plenty of good reasons why this committee should not be set up-not because we object to committees, but because the committee will serve no purpose except that of taking up the time of the members. We believe that action is what is required now. I know there are a few people in the country who do not want controls. But, Mr. Speaker, in the old days when highwaymen and bandits were prevalent in some parts of the world the first government that attempted to control them and prevent them from preying on the^ peaceful public was considered to be a most radical government. The bandits felt they had the right to the kind of life they lived, the right to engage in their piratical activities. Even one of Kipling's poems, the Lament of the Border Cattle Thief, indicates the insult which the chief of the border band1 felt had been visited upon him because the British government refused to allow him and his tribe to prey on the peaceful farmers of the valley in his territory.
The beneficiaries of any system or plan of society-or lack of plan-complain when some privilege is taken from them. But, Mr. Speaker, at the present time the welfare of far too many of our Canadian citizens depends upon the action taken by this government and this parliament to permit a few people, who because of some historical events in their lives have now assumed positions in the economic world, to exercise control which this parliament should have.
I repeat that we see no good purpose to be served 'by this committee. We believe the government should get on with its job, as it has in some of the other instances I have mentioned during the course of my contribution to this debate.


Mr. G. H. CASTLEDEN (Yorkton):: Mr. Speaker, today the Canadian people find themselves in a desperate situation. The proposal that a parliamentary committee be set up at this time reveals how little that fact is
appreciated by those in control in the government here. For the past two years we have been facing rapid rises in the cost of living, which have used up the entire income of the people and drained their last bit of savings. The steepest increases have taken place in the past ten months, and the point now has been reached where the income of the average Canadian breadwinner no longer buys the food, clothing, fuel and care which his family requires for a proper Canadian standard. Each week new prices are announced on basic goods-flour, bread, milk, clothing, shoes, fuel, including coal, wood and oil. Each month, with monotonous regularity, the family finds that its income will not cover the new costs. Every wage earner in Canada is facing the problem of a rapid decrease in the amount of necessary goods his cheque will buy.
Recently I received a petition from my constituency, in the form of a resolution, which with your permission I should like to read to the house:
Whereas the rising cost of living is making it impossible for us to buy the necessities of life in food, clothing, fuel and shelter for our families and ourselves;
And whereas wages and salaries do not keep up with these rising costs, and so our savings are being completely used up;
And whereas there appears to be nothing to stop these costs from going completely out of the reach of the people who need these goods, and will ultimately bring unemployment and depression;
Therefore we urge, in the strongest terms possible, that the authorities at Ottawa who control 'these policies take immediate steps to control prices of food, clothing, shelter and fuel, as basic necessities of life, until the production and supply of these things is adequate to meet the needs.
People who have some savings, or who are in a position to ask their employers for increased wages, are fortunately situated; but those who are on fixed wages, those who are in receipt of war pensions or old age pensions, and wage earners with no savings, are in a desperate situation. Today I think of people out on the prairies in the crop failure areas who have practically no income this year, and who find the cost of living most alarming. Their deep concern is, first, that no effective action seems to be taken, and, second, that there seems to be no ceiling to limit the cost of living. In vain they wait for some action by the government in Ottawa to halt this upward trend, but nothing appears to be done; on the contrary government action sometimes actually makes the situation worse.
Let me give one example to illustrate what I mean. Until last October the prices of coarse grains were controlled. Thus the cost of feeding poultry, beef, pork and mutton was

Prices Committee
kept stabilized at least to some extent, and the cost to the consumer was kept within the reach of the average man's pay envelope. The government waited until the prairie farmers, who grow a large part of Canada's coarse grain, had delivered most of those coarse grains, I believe some 39,000,000 bushels of barley and millions of bushels of oats. Then suddenly the authorities at Ottawa removed the subsidies and turned over control of the prices of coarse grains to be set by the gambling on the Winnipeg grain exchange. Within a couple of weeks prices of these feed grains had increased ten, twenty, thirty, thirty-five cents a bushel, and those prices are still fluctuating to the detriment of both the consumer and the producer.
What was the effect of this action on the part of the government? The feed companies and the grain companies, who had purchased the grain at the lower price, by manipulating the market were able to pocket the difference. The feed companies, which had bought the grain at the lower prices, were now able to charge the increased prices for the feed they sold. As a result we hear such protests as that made last evening by the hon. member for Fraser Valley (Mr. Cruickshank), who told us that the price of feed for poultry had doubled while the selling price of eggs had been reduced by about twenty cents per doz. The net result, as far as Canada was concerned, necessarily was that since it costs more to feed cattle and poultry it costs more to produce milk, butter and eggs. So the cost of these things to the Canadian consumer had to jump, and the cost of living rose tremendously right across the country with regard to foods which are the basis of the nutrition and health of the people of Canada. The farmer who produced the coarse grains and sold before the price increase naturally lost.
The Canadian people are demanding that the Winnipeg grain exchange be closed, and that gambling in foods be stopped. It is costing the Canadian people too much. I think every member of our group has received resolutions from the Saskatchewan wheat pool committees at various points asking for the closing of the exchange. Canada cannot afford it.
Members of this house have complained about these costs. The Canadian people, and rightly so, expect effective action in regard to the rising cost of living; and they want that action now. Six months from now it may be too late. The Canadian people went through one depression. We feel we cannot protest too vehemently against any delay; and we believe that setting up this committee can only bring about a delay in essential action.

The greatest danger from a continuation of the present policy is that Canadian income will continue to be inadequate to purchase the production of this country. When production declines, firms will start laying off employees, and unemployment will further aggravate the situation. The purchasing power of the Canadian pepole, reduced time and again, ultimately will bring about a depression. I am sure every thinking Canadian would do anything he could to avoid a repetition of the thirties. If that is to be done this price trend will have to be halted, so that purchasing power will remain in the pockets of the Canadian people. I repeat that the present situation is desperate, and though its full effect has not been felt as yet, effective action to cure it must be taken now.
In the face of this situation we came to Ottawa and the house reopened on January 26. What did we find? We were told the government proposed to set up a committee. Well, Mr. Speaker, a committee can investigate; it can cross-examine witnesses; it may even expose some profiteering. For several months it will meet frequently; it will hear government officials whose evidence will cover many pages in an endeavour to vindicate government policy. If representatives of large firms are brought to give evidence they will bring with them mountainous briefs prepared by highly paid legal advisers and chartered accountants. We are told that we will find some facts, that the proceedings of the committee will give publicity to the actions of the evil doers. The Prime Minister informed us that he thought publicity was much more valuable than penalties.
Through you, Mr. Speaker, I should like to inform the government and the people responsible for the proposed committee that valuable as it may be in determining the ultimate policy and actions of the government, that type of investigation is not what the people of Canada want. What they want is action within the next few weeks. They are deeply interested in having the cost of living reduced to a point where they can all live better on the pay envelopes they bring home each week. A committee is simply not the machinery which will bring those costs down. It is not enough.
Someone has suggested that this might be a fishing expedition. Well, in a fishing expedition a fishing pole might be a valuable instrument. But what the people of Canada want is more action taken now which will put coal in their basements and food in their cupboards. That cannot be done with a fishing pole. They want the cost of living brought within the range of their pocketbooks.

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The strong exception taken by the C.C.F. group to this committee may have irked the government and hon. members opposite. This protest of ours is not a protest against the committee for what it may or may not do. Our protest-and we have made it as vehemently as possible-is against the policy of the government in not implementing measures immediately to stop the rapidly rising cost of living. It is because the committee which so far is the government's only answer, is just not good enough. It does not and it cannot meet the desperate needs of the situation of the people of Canada today. If the average Canadian were in this House of Commons this afternoon, or if he were speaking of the thing which is closest to him, I believe he would say this, through you, Mr. Speaker: "Please, Mr. King, what are you going to do right now to stop the rising cost of living?" The Canadian people know that a committee will not do it. As yet we have had no answer from the government or from any of its ministers as to what it intends to do now to stop the rising cost of living.
In his contribution to the debate the Minister of Justice (Mr. Ilsley) told us that subsidies were impossible at this time. My reply to him would be that he introduced a variety of subsidies during and since the war, and effectively prevented inflation in this country. He said that was an emergency. I should like to let him know there is an emergency in Canada today; and if the Canadian people have to make a choice between subsidies and unemployment or depression, they will be glad to have subsidies.
As this debate draws to a close the Prime Minister will rise in his place and Canada will be waiting for his answer. Doubtless he will berate this group for its protests; but that will not answer the question. The Canadian people want more than a parliamentary committee. We have a right to be informed that the government will do something to make it possible for the average man in this country to use his pay envelope so that it will bring to him and his family the things he requires for a proper living standard.
By way of constructive suggestion let me repeat one or two of the things which we think should be done to stop this rising cost of living.
First, we require proper fixed prices on essential articles of food, clothing, fuel and shelter. The basic necessities of the average home must be placed within the reach of the average breadwinner in Canada.
Second, I suggest closing the Winnipeg grain exchange, so that the value of feeds and
coarse grains will not fluctuate and wheat will not be allowed to go back on the grain exchange and be subject to constant fluctuations, thereby affecting the cost of living of the people of Canada.
Third, I suggest the restoration of the excess profits tax on all excess profits, so that the Canadian people will have the assurance that excessive profits are not being made by a few people while millions are forced to live in misery or without the necessities of life.
Such a program I understand will not be favourably received by those who had the privilege of grabbing all they could in a time when grabbing was good. But I suggest that this bare minimum is essential to meet the situation today, and it should be established until trade and production are restored at least- to normal conditions.
The Prime Minister's answer to the Canadian people will be one of the most important statements he will make in his long public career. I hope he will not waste too much of his time berating those who oppose his ideas. I venture to say he will have the support of every thinking member of parliament from every part of the house if he outlines a program which will stop the rising cost of living. I can assure him that he will have vehement and continuous opposition from this group if he does not.


William Lyon Mackenzie King: Mr. Speaker, if this debate has served no other purpose, at least it has been a fairly satisfactory test of endurance; and I am happy to discover that at the end of one solid week of sitting in the house, listening to what has been said back and forth in the course of the debate, I have found it possible to hold my own with anyone in the house-which, I suggest, is not too bad for one in his seventy-fourth year.
May I say further it has been something of a test of patience. Here again I take a certain amount of satisfaction from the thought that I have -been able to listen to what might almost be called a volume of vituperation at times, and yet have been able to refrain from saying anything disagreeable or nasty to those who were making remarks of that kind.
There is, however, this real satisfaction about the whole matter: What we have had to listen to is as nothing compared with what we would have had- to listen to from hon. gentlemen opposite had someone on the other side suggested or had he moved that a committee be set up to inquire into the cost of living and the government had refused to
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grant that committee. We would have been told from the different groups, and in many different ways, that, in dealing with a great problem-and I believe all are agreed that consideration of the cost of living is one of the greatest problems facing not only this country but the countries of the world today -the first necessary step to take was that of investigating the causes. We would have been told by hon. members opposite that that is the method physicians adopt when they seek to combat disease. I would point out to hon. members that the cost of disease is one of the factors which keeps higher than it otherwise would be the cost of living to families which suffer in that way. We would have been told by members of the legal profession that that is the method they adopt in seeking to solve the problems of their clients. They look first for the causes at the root of the trouble they are expected to remove. We would have been told by hon. members opposite that investigation into cause is one method scientists adopt in dealing with any question, no matter to what subject it relates. The first necessary step is to ascertain the causes of the trouble into which we are inquiring and to make those causes as clear to the public as possible. That is what the government is seeking to do.
The resolution before the house is a simple one, asking that a committee be formed to inquire into the causes of the high cost of living. It sets out one or two supplementary matters to help make clear the particular causes in which the public are specially interested, namely those relating to possible profiteering, hoarding and the like. Yet we have had all kinds of objections and all this week's debate with respect to the one request by the government, that the House of Commons join with it in doing the one thing which above everything else is necessary in dealing with this all-important question.
I made it clear at the outset that this was but one of the steps which the government was taking; I cited a number of instances of what the government had done already and I indicated that there were other things that the government intended to do. I said that this was to supplement other measures, not to be a substitute for any; that this was one additional means of helping to make clear what further steps there were that would assist in the solution of this problem.
That is a simple statement of what the house was asked to do. But what have we had from hon. gentlemen opposite in the way of acquiescing in that request? We have been forced to listen to a lot of declamation and ridicule; we have had to listen to many oppro-

brious epithets. We have had anger displayed by hon. gentlemen opposite; we have had threats of boycotting; we have had amendments moved to this simple resolution, and we have had appeals from the Speaker's rulings in regard to those amendments. On what grounds can these actions be defended? There is only one explanation that can be given. Hon. gentlemen opposite have recognized that this step which the government is taking is one which the people of thi* country want taken and want taken quickly. Because it has been taken by the government, they are doing all in their power to obscure the importance of that step. That is one explanation.
This motion -was the simple matter of asking hon. gentlemen opposite to join with us in having a committee of the house appointed to investigate the causes of the great problem of the rise in the cost of living in which they, like us, are interested; but they have taken advantage of this opportunity to belabour the government for coming forward with a suggestion which, if any suggestion in the world would be helpful in meeting this serious problem, this one would be.
There are perhaps other reasons. After listening to the debate it has not been difficult to discover that the members of the three groups opposite have felt that this was a good opportunity-seeing that the government had promised to give a good deal in the way of latitude and the Speaker being asked not to rule too rigidly on the different points that might come up in an effort to keep the debate to one issue-to bring out their different policies. They have exploited their policies by using the time of parliament which should have been devoted to other subjects. They have endeavoured to make the public familiar with what they regard as important in their particular policies.
The amazing part of this whole thing is that their policies are as divergent as it is possible to have them. The minute it comes to the vital question of discussing the: policies of hon. gentlemen opposite, that minute they begin to fight with each other like Kilkenny cats. They have no agreement whatever in the matter of policy, but when it comes to an opportunity, as they see it, of trying to embarrass the government they are ready to join hands and dance together merrily enough.
I hope that hon. gentlemen opposite will not think that the public are deceived by anything of the kind. The public have been watching their performance from outside the house with quite as much interest as I have from this side of the house. To me the week

Prices Committee
has been of interest in the sort of entertainment it has afforded and profitable in what it has revealed of the methods adopted by hon. gentlemen opposite in dealing with the public generally. The public will not be deceived by the performance we had in this house over the whole of last week and during the early part of this week on the part of hon. gentlemen opposite.
But there is something more serious than that. In the course of this debate we have had a good deal said that I believe is very unfortunate from the point of view of the future development of parliamentary practice and procedure and of the solution of great questions in this parliament. Among other things, we have witnessed an effort made to change the nature of what has hitherto been regarded as the duty of a parliamentary committee, to change a committee appointed for the purpose of investigating matters, into a committee to devise policy, into a committee which would take unto itself the obligation which, under the British system of government, has always rested on the shoulders of the government of the day. If we continue with that kind of thing we shall soon find the whole basis of our system of responsible government being undermined, with consequences which no one, at this moment, can foresee.
Then there was a suggestion that members of the house would not serve on the committee, that, not being able to have their own way, not being able to get others to see things just in the same light as they saw them, they would not serve, they would refrain from discharging a duty which is part of the obligation of every hon. member of parliament. I do not want to stress the point, but I was very much impressed when I heard the Minister of Justice (Mr. Ilsley) describe his experience in New York while attending the assembly of the united nations. He told us that walking out and refusing to serve was the method being adopted by some of the Soviet representatives at the united nations. I hope we are not going to have government in Canada carried on or developed along those lines, and I hope we have heard the last of any suggestion from hon. members that they intend to proceed in accordance with these new revolutionary methods, if they may be so termed.
Another thing which has been unfortunate is a tendency which has been clearly revealed of continuously appealing from rulings of the Speaker. The Speaker of the house is chosen by the members of the house to preside at its sessions. If there is one rule that is followed by the government at Westminster, above all others, it is that the ruling 5849-68
of the Speaker shall be respected by the house. Someone has to give-the final decision. Where it is obvious that the Speaker is deciding in accordance with rules which hon. members themselves have made for the protection of freedom of discussion and debate, then every time the Speaker's ruling is challenged and an effort is made to have it appear that the Speaker has not given a just and fair ruling, to that extent correct procedure in the House of Commons suffers a heavy blow which, in the course of time, will have far-reaching reactions.
I wish to say this to hon. members about this matter of appealing from the Speaker's ruling. I venture to say that every hon. member of this house knew very well that when the Speaker decided that a certain amendment was not in order because it did away altogether with the original motion, the Speaker was giving a correct decision. They must have known that. Yet they appealed from the ruling of the Speaker and what is-
Mr.	KNOWLES:	I	rise	to	a point of
order-


Some hon. MEMBERS:: Sit down.
Mr.	KNOWLES:	I	rise	to	a point of
order.


Some hon. MEMBERS:: Sit down.


Stanley Howard Knowles: The Prime Minister is
referring to a decision given by Your Honour and voted upon by this house. I submit that he has no right to discuss a matter that has already been settled, and that he is entirely out of order.


Mr. MACDONNELL (Muskoka-Ontario):: Or to impugn our honesty. He is impugning the honesty of everyone who voted against it.


William Lyon Mackenzie King: My hon.
friends may say what they like.


Mr. FLEMING:: Mr. Speaker, on a point
of order-


Some hon. MEMBERS:: Sit down.


Donald Methuen Fleming: On a point of order, is
it not against the rules of the house for an hon. member to reflect upon a vote cast by any other member of the house? The Prime Minister is reflecting upon the honesty of the votes cast by hon. members on this side of the house on an appeal from your ruling, Mr. Speaker, and to do so is absolutely against the rules of this house.


William Lyon Mackenzie King: The point I was making was, I think, perfectly clear. Hon.
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members of this house know very well that where an amendment which has the effect of ruling out a motion made-


Mr. MacINNIS:: I rise to a point of order. If the Prime 'Minister is permitted to discuss a ruling made in the house, then every hon. member has a right to discuss that ruling. The ruling has been made, and before Your Honour made it we did not get an opportunity to say whether or not the ruling was in order. I object to the Prime Minister making art issue of it at this time.


Mr. SPEAKER:: I understand that the Prime Minister is not discussing the ruling which was made by the Speaker.


Angus MacInnis: He is discussing the ruling.


Mr. CHEVRIER:: He was discussing the conduct of the opposition, and he has a perfect right to do so.


Stanley Howard Knowles: The Prime Minister is not God.


Angus MacInnis: That is one way of getting away from discussing the cost of living.


William Lyon Mackenzie King: If it will enable us to get a little nearer to the appointment of this committee I am prepared to end the discussion at this point. But I think the point I was making was pretty clearly understood by hon. gentlemen-


James MacKerras Macdonnell: On a question of privilege, Mr. Speaker-


Some hon. MEMBERS:: Sit down.


James Horace King: Order. The hon. member has the floor.


James MacKerras Macdonnell: I want to know whether in saying he is willing to drop it the Prime Minister is withdrawing what he said when he imputed dishonesty to everyone who voted against the ruling. I want to know whether he withdraws it.


William Lyon Mackenzie King: Well, Mr. Speaker, I must confess I am a little terrified by the look of my hon. friend. Notwithstanding that, I must say to him that all that I have said I have said for the best of reasons and it is in no way intended to reflect-


Some hon. MEMBERS:: Order.


William Lyon Mackenzie King: -and in no way intended to reflect on anyone. I was referring to something that has happened in this house, an unfortunate practice that is growing up.


Some hon. MEMBERS:: No.


William Lyon Mackenzie King: What is my hon. friend shaking his head so much for? I have said nothing to cause him any feeling. I have said what every hon. member knows to be the fact; they know certain amendments-


James MacKerras Macdonnell: I rise again on a question of privilege. I want to know whether the Prime Minister has withdrawn the imputation which he made against everyone who voted against this ruling when he said that it was a dishonest vote. That is what he said.


Douglas Charles Abbott: No, he did not.


James MacKerras Macdonnell: I want to know whether he withdraws it.


William Lyon Mackenzie King: Mr. Speaker, hon. members know very well that I have no intention of casting any reflection on any member of parliament with respect to his honesty, and I have not done so.


James MacKerras Macdonnell: Why not say so?


William Lyon Mackenzie King: I have not done so, and I have nothing to withdraw.


Stanley Howard Knowles: I rise to a point of order. I humbly request Your Honour to rule whether the Prime Minister has been in order or out of order in his discussion of your ruling.


James Horace King: Order. I understand, as I said a few minutes ago, that the Prime Minister has not been discussing the ruling which has been given by the Speaker. He is reviewing what happened during the debate. I do not think that the Prime Minister has imputed any motives to hon. members.


Some hon. MEMBERS:: Oh, oh!


James Horace King: He gave his opinion of what happened during the debate.


Angus MacInnis: It is no wonder that rulings are appealed.


Lionel Chevrier: He is discussing your conduct, and you do not like it.


Stanley Howard Knowles: If it is your ruling that the Prime Minister is in order, I respectfully appeal your ruling to the house.


James Horace King: Order. I would ask the hon. member to recall that in discussing a ruling which I gave on an amendment I drew hon. members' attention to the fact that often some hon. members seem to be of the opinion that in ruling an amendment out of order the Speaker rules against its merit. The same thing applies to a motion to adjourn the

Prices Committee
house to discuss an urgent matter of public importance. As I said before, because the Speaker does not accept the motion, some members seem to be under the impression that the Speaker does not believe that the question which the hon. member wishes to discuss is urgent and important. Because of that some hon. members appeal the decision of the Speaker. During the course of the debate two amendments were ruled out of order and they were appealed. In closing the debate the Prime Minister is reviewing what happened during the debate. I do not see any objection to what.he has said up to now.


Stanley Howard Knowles: Mr. Speaker, I asked you to rule whether or not the Prime Minister was in order. You have indicated that in your opinion-


Some hon. MEMBERS:: Sit down.


Stanley Howard Knowles: -the Prime Minister is in order. Standing order 12 states that the Speaker decides points of order, subject to an appeal to the house.


Some hon. MEMBERS:: Sit down.


James Horace King: Order. I did not decide any point of order. I just said I did not think that the Prime Minister had anything to withdraw.


Stanley Howard Knowles: I raised a point of order. Under standing order 12 Your Honour has the duty of deciding on the matter raised, subject to an appeal to the house.


James Horace King: The hon. member knows very well that if he wishes to appeal, some other hon. members must rise in their places.


Stanley Howard Knowles: Oh, well, there are plenty of us to do that.


James Horace King: Those who are in favour of the Speaker's ruling being sustained will please say "yea."


Some hon. MEMBERS:: Yea.


James Horace King: Those against please say "nay."


Some hon. MEMBERS:: Nay.


James Horace King: In my opinion the "yeas" have it.
Mr. Speaker put the question as follows:
The question before the house is an appeal from the Speaker's ruling. The hon. member for Winnipeg North Centre (Mr. Knowles) raised a point of order to the effect that in the course of his reply in the debate on the motion to appoint a select committee the right hon. the Prime Minister imputed certain motives to the opposition members. I ruled that the Prime Minister did not.


Mr. BLANCHETTE:: I was paired with the hon. member for Stanstead (Mr. Hack-ett). Had I voted, I would have voted to sustain your ruling, Mr. Speaker.


Mr. COTE (St. Johns-Iberville-Napier-ville):: I was paired with the hon. member for Grey North. (Mr. Case). Had I voted, I would have voted to sustain the ruling of the Speaker.


Mr. HATFIELD:: I was paired with the hon. member for Three Rivers (Mr. Gariepy). Had I voted, I would have voted against your ruling, Mr. Speaker.


Mr. McLURE:: I was paired with the hon. member for Beauce (Mr. Dionne), Mr. Speaker. Had I voted, I would have voted against your ruling.


Mr. HEON:: I am permanently paired with the hon. member for Joliette-L'Assomption-Montcalm (Mr. Lapalme), Mr. Speaker. Had I voted I would, with great regret have voted against your decision.	.


William Lyon Mackenzie King: Mr. Speaker, if it is any consolation to hon. gentlemen

opposite I would1 say to them at once that, being most anxious to see this committee appointed as soon as possible, I promise I will not take up too much more of the time of the house this afternoon. So I hope that without its being found necessary on my part to raise any question of privilege or point of order I may be permitted to continue my remarks without being interrupted too freely from the other side of the house.
Obviously, having regard to the amount of talk-if that is not an unparliamentary expression-to which, we have been obliged t listen for the last week, I cannot attempt in a short time to do more than give illustrations of the sort of' argument that has been presented by hon. gentlemen opposite, and to which I am expected to reply.
In the first place, I would say that in following the debate I have not been able to discover anything that v'as too small for hon. gentlemen opposite to take exception to; and, after saying that, may I make the further assertion that I cannot think of anything they have brought forward thus far as to which, if we had brought it forward, they would not have found an equal amount of argument to present on the opposite side. They were determined at all costs to make it as difficult as possible to have this committee appointed. They were determined to make a display before the country of several days of Obstruction of the government to have it appear that the measure the government was bringing forward was not in the public interest.
As an illustration of what I have said about nothing being too small, let me direct attention to the first clause in the motion I presented for the appointment of the committee which reads:
(a) the causes of the recent rise in the cost of living.
That word "recent" has been just too much for hon. gentleman opposite. They had to take exception to it. I was astonished at the number of members who did so, and particularly at some of those who took that exception. When this house reassembled at the beginning of the new year, my hon. friend the leader of the opposition (Mr. Bracken) rose in his place and said, as reported at page 543 of Hansard for this year:
... I wish to move, seconded by the hon. member for Muskoka-Ontario (Mr. Macdonnell) the adjournment of the house under standing order 31, for the purpose of discussing a definite matter of urgent public importance, namely the sudden and unprecedented rise in the cost of living.	,

Prices Committee
The hon. gentleman mentioned the "sudden rise in the cost of living." Well, when the government was drafting this motion, being anxious to gain as large a measure of support and agreement as possible from hon. gentlemen opposite, we thought it would be desirable to put in the word "recent" in order to have the motion accord with what my hon. friend felt was the most urgent matter. He was anxious that it was the recent increase that should be taken into account. May I just ask hon. members this question. Suppose the government had left out the word "recent" and the clause had read "the causes of the rise in the cost of living." What would we have heard from hon. gentlemen opposite? We would have been told that we were giving the committee an academic task, that of going into the causes of the rise in the cost of-living, something which might take them back not only generations but possibly centuries; that we were deliberately trying to give the committee something to do which would take up all their time before they would get anywhere at all. I need not elaborate the point further, but I give this as an example-and it is an example which applies all along the way-of many of the points which have been raised, and to which exception has been taken and the government's motives misinterpreted and misconstrued.
Then I come to the question of recommendations, the next objection which was raised frequently-that the government had not put in a clause giving this committee power to make recommendations. Well, I would recall to hon. members what I said in introducing the motion, before anyone on the opposite side had spoken. I said the government had purposely left out that clause at this stage for the reason that we wished to have the committee get on with the work of investigating causes, that parliament and the public might know the results thereof as rapidly as possible; that had the committee been asked to make recommendations, we would have found that the time of the committee would be taken up, as is pretty obvious from the debate which has taken place here, by discussion between members of different parties as to which particular recommendation should be made, whether it would be a recommendation along the lines of my hon. friends of the Progressive Conservative party or a recommendation along the lines of the C.C.F. or along the lines of the Social Credit party, should that party have a recommendation that it might wish to make. Certainly, with a request for recommendations of this type, the time of the committee would be
taken up in a discussion of which particular recommendations they should make.
I need not take much time to point out the truth of what I am saying, and of how futile that might render the work of the committee. During this debate many references have been made to the committee which was appointed in 1934 to deal with the question of price spreads. That committee was given power to make recommendations; indeed it was asked to make recommendations, and what was the result? Well, the leader of the C.C.F. party (Mr. Coldwell) has told the house what was the result of giving that committee power to make recommendations. If hon. members will 'look at page 863 of Hansard for February 4 of this year they will find the following remarks by the leader of the C.C.F. group:
Reference has been made to the price spreads committee of 1934. I looked up the record to see how long it took that committee to make its report. On February 2, 1934, just fourteen years ago to the very day that we began to discuss the resolution now before us, the order of reference for the setting up of the committee passed this house. On February 22, twenty days later, the first meeting was held. The last meeting was on June 22, 1934. Then, as hon. members will recall, the committee became the royal commission. On October 30, 1934, the royal commission met for the first time. On February 1, 1935, one year later, the last meeting of the commission was held, and on April 9, 1935, it reported. Confirmation of what I have said will be found in the report of the commission which I have before me.
Imagine for a moment what would have happened if the government had said in this motion that the committee was to make recommendations! Would any hon. member suggest that this particular instance would not have been cited immediately by the leader of the C.C.F. and other hon. members opposite as a reason why we should not give the committee, at this stage, power to make recommendations? Does anyone suggest that we would not have been told that it would take two years before this house would get any word from the committee on which action could be taken one way or the other? Nothing could be plainer than that.
But what is even more to the point is what the hon. member himself was prepared to do with regard to one. of the amendments which were before the house. It will be noticed that in the passage I quoted the leader of the C.C.F. party was talking about the committee on price spreads. He was presenting an argument showing how long it took that committee to make a report. The leader of the opposition had before the house an amendment which asked that the resolution
Prices Committee

be amended to provide, among other things, that the committee examine and report upon-
(g) spreads between prices received by producers and prices paid by consumers.
That particular clause was left in by the C.C.F. when the hon. member for Winnipeg North Centre moved his amendment to the amendment that had been moved by the leader of the opposition. In other words, after telling this house that on the basis of the experience of the price spreads committee, it would be two years or more before we could expect any report from this committee, the leader of the C.C.F. group, as well as th" leader of the government, was prepared to support-I mean the leader of the opposition-


Mr. GRAYDON:: Hear, hear.


William Lyon Mackenzie King: Well, if my hon. friend gets any satisfaction out of that, let him have it; because it will be a very long time before he will ever, have any satisfaction from office.


Gordon Graydon: Coming events cast their shadows before.


William Lyon Mackenzie King: Mr. Speaker, if the word "insincerity" is not unparliamentary, I should like to use it in reference to this particular action on the part of a leader of a party that will denounce the. appointment of a committee with power to recommend on questions of spreads between prices received by producers and prices paid by consumers and then, when that has served his purpose, turns around and is prepared to vote with those who are in a party opposite to his own, that the committee be now given the power to report on spreads between prices received by producers and prices paid by consumers.
I hope I have made it plain also that if, as the committee pursues its investigations, it is thought advisable to have its powers enlarged so that it might be given an opportunity to make recommendations with respect to certain matters, the government will be quite prepared to consider any request of that kind at the time it is brought forward. But what we do not wish today, at the present time, is to give any excuse whatsoever to the committee for not devoting its time and attention in a thorough way to the investigation of the rise in prices and the cost of living, which is what we believe the public are most concerned about.
Another argument put forward by hon. members opposite is that I had said, speaking with respect to the price spreads committee when it was before the house-I refer to the

motion to appoint a committee on price spreads in 1934-that under the Combines Investigation Act there was plenty of authority to proceed and to effect a remedy. And because I had said that in 1934 in relation to that particular committee, hon. members opposite say the government should have found enough scope at this time under the Combines Investigation Act to settle this matter of prices.
I thought I made it quite clear that the committee which was dealing with price spreads had before it an entirely different kind of problem from what we have at the present time. We may have certain aspects of that problem to deal with at this- time; but at that time wfhat the committee was trying to find out was how it was that on the one hand primaTy producers were being exploited because the prices they were receiving for what they were selling were being kept down, while, on the other hand, consumers were being exploited by some agencies which were keeping up prices in regard to those very same commodities which they desired to purchase. Somewhere in between there was some force at work which had the effect of accounting for that large spread. The particular kind1 of organization which would be found in a case like that would be in the nature of what we call a combine or merger, or an association of persons who bound themselves together to serve their own particular ends as against those of producers or consumers. That was the duty of that committee at that time-to investigate mergers, trusts and combines. And naturally, when speaking on that question, I said that there was an act on the statute books dealing with mergers and trusts, and that there was sufficient authority under that act to find out what was necessary to be found out in connection with combines, trusts and mergers.
But here, in present circumstances, we may have many causes of prices being kept up, in *which the question of combines does not enter at all. Combines may be one reason for prices rising. But they are not the only reason. The government is seeking today, under the Combines Investigation Act, to find out to what extent mergers, trusts and combines are responsible for this rise in the cost of living. But we cannot stop there. We must look for everything we can discover, affecting the increased cost of living, and once that information has been secured it will not take long for this parliament to meet those conditions by legislation, if they are of a character that can be met by legislation.
The whole question then was, as Mr. Stevens himself made clear when he spoke on his motion, that the committee was ap-

Prices Committee
pointed to look into the possible, alleged or presumed existence of a combine. That is what the whole inquiry was about. From this side of the house it has been made clear from the outset that the whole administration under the Combines Investigation Act is directed toward one specific end, namely, that of discovering combines. It is not for discovering causes of rising prices outside the Combines Investigation Act altogether.
Another criticism levelled at the government in connection with this motion is that the scope of the committee is not wide enough. Hon. members opposite say the scope is not wide enough, and there have been amendments moved to enlarge its scope. What is the sdope? It is the causes of the recent rise in the cost of living. You can take it all in that one paragraph, if you like. The paragraph is all-embracing as to whatever affects the increased cost of living. Can anyone suggest any wider scope than that? To discover the cause of the rise in the cost of living, can anyone give wider scope than is contained in that one sentence where, without any limitation or without being circumscribed in any way, the committee is given power to investigate every possible cause?
A number of things have been mentioned by hon. members opposite in their amendments-policies, subsidies, and what-not. Any one of those things they have mentioned, if it is responsible for the rise in the cost of living, can be investigated by the committee under the clause I have mentioned. The purpose in introducing those amendments could not have been to widen the scope. If accepted, they would only have served to narrow it, if anything, by directing the attention of the committee to certain specific things. The committee might then have felt that it should give its time to those specific things, rather than to the all-embracing question it is asked to investigate.
So far as the subject matter of the amendments relate to causes of the increase in the cost of living, whether due to government policies, subsidies or anything else, they will be under investigation; and those matters are adequately taken care of by the first clause in the motion. These are all involved in the investigation; and to introduce other factors is simply to destroy the purpose of the motion.
No, Mr. Speaker, the amendments have not been made to enlarge the scope of the committee. They have been made to change the purpose of the investigation. The committee is to be appointed to gather facts and to get information so that this House
of Commons and the country may be clearly and fully informed. But the movers of the amendments say, in so many words, "no, that is not what we wish this committee to do; we wish the committee to discuss policy. We do not want it to discover facts. We do not want this committee to obtain information; we do not want it to give us facts. As a matter of fact, we do not want the committee at all." That is perfectly clear from one motion which was put, and to which I made reference today. I hope my hon. friends opposite will not take objection if I refer to it again. The motion by the leader of the C.C.F. was to the effect that all the words after "that" in the motion be stricken out and that there be substituted therefor a certain declaration of policy or opinion which the amendment contained. In other words, the contribution made by the C.C.F. in their second amendment was to the effect that we ought to have no committee at all to investigate the causes of the rise in prices, but that any committee that might be formed should be diverted to something else altogether.


Stanley Howard Knowles: Yes, action.


William Lyon Mackenzie King: Now, if my hon. friend would just try to restrain himself. I know he likes to appear before the public from day to day by his interruptions.


Stanley Howard Knowles: By your attitude you admit that we are right.


William Lyon Mackenzie King: He is not by any means making the impression either upon the house or the public generally that he thinks his utterances make, when he interrupts other speakers.
As I have said, the purpose was not that. Another purpose brought forth clearly by some of the amendments proposed was that we should give this committee power to make policy and recommendations involving the expenditure of large sums of public money. Here again we have another example of what I was speaking of before as tendencies in this debate which are evidence of the change that is coming over the thinking of some hon. members with reference to British parliamentary procedure and practice. It is something that we ought to consider most carefully.
The rules of this house have been framed, and the practices of parliament up to the present have been framed, amongst other things, to protect the public treasury, and not to make it possible for any group in parliament to have large sums of money taken out of the public treasury because they themselves
Prices Committee

wish to have it spent in a particular way. The whole effort of the past has been to place the responsibility for expenditures of public moneys on the shoulders of the government, and to hold the government responsible to parliament and the people for expenditures. Some of these amendments have involved a departure from what is a very sound principle of government.
Another criticism that has been made is that the powers of the committee are restricted. I have already covered that in part, in what I have said about the scope of the committee. Someone said that, unless there was power given the committee to make recommendations, there was no power in the committee at all. Here is what the motion says:
That the committee shall have power to appoint from among its members such subcommittees as may be deemed advisable or necessary to deal with specific phases of the enquiry, and power to send for persons, papers and records, to examine witnesses under oath and to print such papers and evidence from day to day as may be ordered by the committee.
There is another paragraph to which I would particularly direct the attention of hon. members who say that the powers of the committee are restricted. This reads:
That the committee shall have power to engage the services of counsel, accountants and other necessary assistants who shall be paid out of the appropriation for parliament.
What greater powers could be given to a committee than that? There are all the powers of a royal commission, the power to summon persons from one end of the country to the other, to engage experts to make inquiry into any phase of this question, to have highly trained accountants serve the committee in its efforts to find out what is the cause for the rise in prices. I can understand persons who, in times like the present, may have been hoarding, or who may be seeking to profit, complaining about an investigation into the questions of hoarding and profiteering; I can understand them not liking the idea of a committee that will have all the powers necessary to discover these things; from that source I can understand opposition to a committee of this kind. However, I find it difficult to discover any ground of complaint, from the point of view of the public interest, against a committee which will seek to serve the public by discovering as soon as possible what the causes are that account for the recent rise in the cost of living in our country.
One other matter. We have been told over and over again that it is action that hon. gentlemen want, not a committee. To some extent their behaviour during this last week has borne that out. They certainly have not

made it easy to get a committee functioning. We have been a whole week in just trying to get a yes or no answer as to whether a committee should be appointed. What action have we had? We have had something in the nature of action from hon. gentlemen opposite, but all along it has been what might be termed "a delaying action".
When I spoke a week ago Monday I told the house that we would set apart the following week for the discussion of this measure, that we would give precedence to it over any other measure, that the government was anxious to have this committee appointed as soon as possible. What happened the week before? I had to ask hon. gentlemen opposite please to come along with the names for the committee that I had requested in a previous week. I should have said that, as soon as the house reassembled in the New Year, I gave my hon. friend, the leader of the opposition, the assurance that we would appoint this committee within a week. I said, first of all, "possibly in two weeks." I knew from the past that hon. gentlemen opposite have been accustomed to delaying a little the sending in of the names for committees, and that has proved to be true again in this case. The leader of the opposition said, "No, we must have this in a week." I said, "All right, let us have it in a week, but before it can be set up within the week we have to have the names for the committee." I had to ask hon. gentlemen please to hurry along with the names so that we could go along on Monday with setting up the committee.
What happened on Monday when the motion was introduced to set up the committee? I proposed to give the motion precedence all through the week, but hon. gentlemen took exception to my effort in that regard. They raised objection to the discussion on the appointment of a committee from being gone on with on the following day. Well, we did manage to keep the debate going for four days in the past week, through yesterday and up to the present time. This whole matter might have been settled on Monday afternoon, over a week ago, but here we are on Tuesday of the following week still seeking a simple yes or no answer to the question of appointing a committee to investigate the rise in prices.
I say again that the action of hon. gentlemen opposite has been definitely a delaying action. The responsibility has not been that of the government; the responsibility is that of those who, up to the present time, have made it difficult to get this committee appointed. As I have already said, if hon.

Prices Committee
gentlemen of the C.C.F. had had their way there would have been no committee at all. Their amendment was to the effect that the entire motion should be struck out and something else substituted in its place.
Let me come now to a further criticism. We have been told that the government's action has been evasive, that there has been inaction and that we are responsible for that. Let me say that if there has been any evasion or inaction the blame is not on the shoulders of the government; it is squarely on the shoulders of hon. gentlemen opposite.
We have been told by the leader of the C.C.F. that he was angry; we have been told by him and others that the public were angry. May I say that I do not think that anger is an argument or an answer to anything. I am quite prepared to admit that hon. gentlemen opposite have shown many signs of anger and displeasure, but I would say that so far as the public is concerned the anger is not against the government; it is very much against those who up to the present have been making it as difficult as possible for the government to get this committee appointed.
I want to give my C.C.F. friends and some other hon. gentlemen opposite something to think about in the next few days. If they listen to a statement I have here they will probably take it from the source from which it comes when they might not be prepared to take it from myself. No doubt some of them have already seen what has been appearing in many of the journals of this country with regard to their attitude in this debate. Let me just repeat what I have said. I have had conversations with a great many people during the course of this last week, and particularly at the beginning of this week. I have been asked, why this waste of public money? When is this waste of the time of parliament to cease? These people have said, "Surely it is possible for the house to make up its mind whether it wants a committee to investigate this matter without talking day after day to debate this question, delaying the consideration of other questions already on the order paper and others still to come.
I hold in my hand one editorial; I give it as a sample; I cite this particular editorial because I do not think anyone in this House of Commons will accuse me of having inspired the source from which this editorial came. It is an editorial from the Toronto Globe and Mail, of date February 6, 1948. The heading of the editorial is, "Evasive Inaction", the very words that hon. gentlemen opposite have been using. They say the government is seeking to evade. They have been accusing it of
inaction and so forth. In order that I may not be accused of omitting any significant clause in the editorial, I should like to read the whole of it to hon. gentlemen opposite and in particular to the members of the C.C.F. party. The editorial, as I say, is entitled, "Evasive Inaction". It reads as follows:
Opposition groups in the commons failed, during the debate on the parliamentary price probe committee, to achieve acceptance of several amendments. Some of these probably had merit. But the government's refusal to accept them is no excuse for the boycott of the committee threatened by the C.C.F. leader. Whatever else may be its defects, the committee, with all the authority of a commission, is empowered to examine and report on "the causes of the recent rise in the cost of living." This can mean a lot or little, depending on the diligence and initiative shown by the committee. There are here surely no barriers to full examination into those charges of profiteering and other abuses of the short supply situation in consumer goods, which have been flying back and forth across the country.
It is perhaps significant that the loudest cries about the "ineffectiveness" of the committee have come from the same quarters that have had the most to say about profiteering and other excesses. Mr. M. J. Coldwell, national leader of the C.C.F. party, is the chief advocate of the boycott-"W7e are going to be no party to this manoeuvre." He was also the author of the assertion that Canadian packing companies would make an "unearned increment" of $10,-OOfh'OOO out of the meat price rises in early J anuary.
If Mr. Coldwell is not trying to escape the obligation of proving this latter statement, he should be willing and eager to give the committee a chance to demonstrate its effectiveness or lack of it. His course is simple. He can go before the committee at the earliest possible moment, restate his charge and bring forward the evidence to support it. If the parliamentary committee is, as he implies, an instrument of evasion, the nation will not be long in finding this out.
As matters stand it would seem that Mr. Coldwell and his followers are attempting to avoid the penalty for having talked too much by talking some more. If they are prepared to make good on their allegations of profiteering, they need not be fearful of the inadequacies of the committee. We venture to suggest that, lethargic as it has been on many things, parliament, when prodded by a convinced public opinion, will readily make good any shortcomings which may be found to exist.
I recommend that editorial as a sample of editorials which are appearing right across the country today, as evidence of what public opinion is asserting in this country today. The people are tired of having members of parliament seek to thwart a measure that will throw light on the question that, above all others, they wish to have investigated, which is what they want and what they recognize will be most effective of all in this matter.
Prices Committee

As I said at the beginning of this debate, there are some evils that publicity will cure which penalty will never cure, and there are none of that category which will disappear before an informed public opinion more quickly than anti-social evils, such as profiteering and hoarding at times like the present; the very evils which this committee is being appointed to investigate.
As against the attitude taken by hon. gentlemen opposite in this debate with respect to the appointment of a committee to investigate the cost of living and the rise in prices, may I give to the house the attitude of the Liberal party in regard to the two other large investigations on the cost of living and prices which have been held in previous parliaments. Two committees have been referred to repeatedly in this debate, and my remarks in regard to what was said in discussion of these committees have been frequently quoted. I notice that, in all these quotations, hon. gentlemen opposite were very careful not to quote the really important part, namely, the attitude of the Liberal party toward the appointment of a committee. They did tiy to construe other parts as having a different meaning from what they were ever intended to have. But the position of the Liberal party in regard to both of these committees is quite clear. The first committee was appointed in 1919. Sir Thomas White, who was then minister of finance in the Conservative government of the day, moved for the appointment of a committee to study the question of the cost of living. That motion was brought forward and it was carried unanimously. There was not the loss of a day; there was not the loss of an hour. The matter went through this house in accordance with what the house believed at that time was the wish and feeling of the public in a matter of this kind. The feeling today is just the same as it was then, and many of the reasons for the committee are just the same as they were at that time.
What about the price spreads committee of 1934, which was moved for by Mr. Bennett? That is the debate from which, to a greater or lesser extent, my remarks have been quoted. Let me give the house exactly what I said in speaking in that debate on the appointment of a committee to investigate. I quote from Hansard of February 2, 1934, at page 217, in the debate on the appointment of the price spreads committee:
May I say a further word in order that there may be no misunderstanding of my attitude or of that of the party on this side of the house? We have repeatedly stated'-and indeed the legislation that has been introduced under the former Liberal administration shows the evidence of our belief-that we believed there are

many evils of a class which publicity would do more to cure than penalty. Certainly evils which are in the nature of anti-social practices, if that term may be used to cover what I think we all have in mind, namely, the kind of thing that enables the mean man to profit by virtue of his meanness, are perhaps more effectually cured by publicity than by aught else. Anything which will throw light upon these antisocial practices is, I believe, wholly in the public interest. Certainly the kind of practices set forth in the -resolution as introduced by the government, constitutes a class of evils from which this country is today suffering to a great degree in common with other countries throughout the world, I doubt- very much if there is a single evil that more affects the well-being of consumers than those agreements which artificially fix or control prices and one way or another restrict and hamper trade. The internal trade of our country has become honeycombed and enmeshed by secret understandings and agreements. So far as the Liberal opposition is concerned, we heartily welcome anything that will throw light upon this class of evils. I can say for the official opposition that its members will join very cordially -and wholeheartedly with the Prime Minister and his friends in endeavouring to make the investigation just as thorough as it can possibly be made.
That is what the government is seeking to do today, to have a committee appointed which will make an investigation, as thorough as it can possibly be made, into this great question.
Lion, gentlemen opposite have helped to make it as difficult as possible to get this committee appointed. It is now for them to say what their attitude is to be when it comes to a vote on this question. Let me tell hon. gentlemen immediately that they will have an opportunity to vote on this question. I should say again the government is asking this house, and asking everyone in this house, to assist it in appointing a committee to investigate the recent rise in the cost of living. The government intends to appoint that committee regardless of any attitude taken by the opposition to obstruct it. We do hope that, in the end, all will join and do their best-, as we believe the country will wish us all to do, in furthering the work of this committee. But if they are not prepared to do that, they will be answerable, not to the government, but to parliament, to their constituencies, and to the people whose interests we are here to serve.


Mr. JEAN:: I was paired. Had I voted, I would have voted for the motion.


Douglas Charles Abbott: I was paired with the hon. member for Stanstead (Mr. Hackett). Had I voted, I would have voted for the motion.


Mr. CLARK:: I was paired with the hon. member for Kent, Ontario (Mr. Desmond). Had I voted, I would have voted to support the motion.


Alcide Côté: I was paired with the hon. member
for Grey North (Mr. Case). Had I voted, I would have voted for the motion.


Heber Harold Hatfield: I was paired with the hon. member for Three Rivers (Mr. Gariepy). Had I voted, I would have voted against the resolution.


Winfield Chester Scott McLure: I was paired with the hon. member for Beauce (Mr. Dionne). Had I voted, I would have voted against the motion.


Georges-Henri Héon: I was paired with the hon. member for Joliette-L'Assomption-Montealm (Mr. Lapalme). Had I voted, on the principle that half a loaf is better than no bread, I would have voted for the motion.
Foreign Exchange Conservation


FOREIGN EXCHANGE CONSERVATION
[Stage Direction]
The house resumed from Friday, January 30, consideration in committee of Bill No. 3, respecting emergency measures for the conservation of Canadian, foreign exchange resources -Mr. Abbott-Mr. Macdonald (Brantford City) in the chair.
On section 1-Short title.
James MacKerras Macdonnell: Is the minister going to make a statement, or is he going to give the information which was asked the other evening and which I think he said he would furnish in due course; that is to say, the question asked originally by the hon. member for Stanstead with regard to changes in the fund? I think the minister will remember that.


Douglas Charles Abbott: I recall that the hon. member for Stanstead asked what portion of our exchange reserves, the figure I gave to the house, was represented by gold and what portion by United States exchange.


James MacKerras Macdonnell: Yes, and I believe the minister said he would give a breakdown. That is what I understood.


Douglas Charles Abbott: That is right. I do not know that I have the figure here at the moment. I was not quite sure that we would be going on this afternoon, but if I do not have it now I shall give it this evening. I have the approximate figures in my head, but I had better give the exact figures.


James MacKerras Macdonnell: Mr. Chairman, we have been jumping about so much from subject to subject, and it is so long since we had our minds addressed to this bill, that I think it would be desirable for me to recall the general background to the minds of hon. members before I begin to ask questions about the bill and comment on its details. I want to lay the foundation for some questions I wish to ask.
First, I should like to recall to hon. members that when, this matter was brought up last autumn we were here for the so-called emergency session. During that session we jumped about from bill to bill, as we have been doing this session. I agree with what was said by the hon. member for Cape Breton South the other evening, that this jumping about from bill to bill is very confusing; and for that reason, as I say, I should like to take hon. members back to the reasons for this bill and the arguments which have been addressed to the house up to the present.
(Mr. Heon.]
In the first place, we remember that the bill is to meet an emergent shortage of United States dollars. We have suggested here that there was great delay on the part of the government; that what was originally a small cloud was allowed to grow until finally it darkened the whole sky.
We had this bill before us in December. We looked at it; then it was removed from our sight, and we did not have another look at it until we came back here a little more than a fortnight ago. Since then, we have gone on with a three-ring circus-this bill, the cost of living debate, and from time to time that poor despised debate on the address. So for a moment, as I say, I should like to recall the seriousness of the problem with which we are dealing.
We recall that the shortage of United States dollars goes to the very root of our economic life; that if we dio not have United States dollars with which to buy necessary goods we face unemployment and all kinds of undesirable and difficult things. We say and have said-and I only mention it in passing, without dwelling on it-that in the main, if not exclusively, this was due to government mistakes. We say things were going along reasonably well in June, 1946, when the government decided to return to parity with the United States dollar, and that it was the decision then made which started a perfect avalanche of United States dollars from this country, to the point that last November the situation became so dangerous that the government was constrained to act.
I want to say a word1 about the debate. In one way I think it has been very disappointing. Apart from the ministers' speeches I think the government side contributed some fifteen minutes to the debate, or about two minutes a day. I quite realize that a government desiring to get business done does not encourage its own members to speak much, but it seems to me a great public loss that those who represent a very large section of the community should not be allowed to intervene at all in this debate. It seems to me that the process whereby a government, in order to expedite business, has muzzled its own members has been carried1 to a very injurious extent. As a matter of fact, in addition to muzzling its own members the government would like to muzzle us a bit. As I say, I can quite understand that governments dislike talk unless it is done by themselves, because talk is apt to produce criticism, and naturally governments do nob want criticism. In passing, it does seem to me one

Foreign Exchange Conservation
might point out that this tendency on the part of government members to sit in the House of Commons in silence-


The DEPUTY CHAIRMAN:: Order. I hope my hon. friend is not now going to make a second reading speech on section 1 of the bill.


James MacKerras Macdonnell: No, Mr. Chairman, I assure you I am not. I am just laying a foundation for one or two questions I wish to ask, and I shall be brief. I was just saying it seemed to me that under our system of government, with all its advantages, we are running a great danger of so denaturing the members on the government side of the house that we lose the undoubted advantage they have in the United States, where the legislative side has much more authority than we have here. Perhaps it has too much authority there, but here I think the executive side has grown out of all proportion to what was originally intended.
I come to the minister's speech. He said the principle of the bill is a very simple one, namely the use of import restrictions to conserve United States dollars. Then he went on to say that one might quarrel with details, but that surely no one could quarrel with that principle. I deny that that is the principle. His statement is correct so far as it goes; but I suggest that it is only a partial statement and that it leaves out what is the most important, or, at any rate, a very important and objectionable feature of the bill, namely the arbitrary powers given to one man.
That is a principle we find now in peacetime in a bill before the committee, and it is a profound misfortune that it has not been discussed at greater length. It is a profound misfortune that the government has been led into a measure of this kind. I find it difficult to believe that the Prime Minister, with his background, could in his heart be in favour of legislation of this kind. I am sorry he is not in his seat at the moment, but I should like to read-


William Henry Golding: Order. I believe I should remind the hon. member that the principle of the bill was dealt with on second reading and supported by a vote of the house. I should hope that the hon. member would now direct his attention to the sections of the bill, the first of which deals with the short title.


James MacKerras Macdonnell: I bow to your ruling, Mr. Chairman, but I submit that a practice has grown up whereby we have been allowed a great deal of latitude
on section 1. I have heard that argued in the house on many occasions in the comparatively short time I have been here; and it seems to me that, while the rule has always been stated, the rulings have been somewhat lenient. As I said a minute ago, I am really laying a foundation for some questions I should like to ask, and I can assure the committee that I shall not be long.
I believe it is important for us to have in our minds the great objection which this party has-and I hope it is shared by others-to the arbitrary powers the bill gives to one man. That is something we must keep in mind when we are dealing with these schedules; our whole judgment of what is contained in the schedules and in the bill itself must be affected by that objection.
I was about to say that I find it difficult- and I wish the Prime Minister were here so that he might speak for himself-to believe that the Prime Minister, with his background, could really believe in this. I should like to read briefly from a broadcast made by the Prime Minister during the 1935 election campaign. In his speech on July 31 of that year he said:
It was not until someone began to preach the doctrine that parliamentary methods were not suited to these times; that the constitution was an obstacle to progress; that shorter and swifter methods were necessary to obtain results even if they involved sweeping aside parliamentary restraints, and over-riding the constitution, that in Europe parliaments and democracies alike began to disappear. Have we not all heard this very sort of language from Mr. Bennett, Mr. Woodsworth and Mr. Stevens?
And so I wish to make the point that the real principle of the bill, or at any rate a real principle of it, is its arbitrary power. The minister will no doubt say that flexibility is desirable.


Douglas Charles Abbott: On a point of order, I must challange the statement that the principle of the bill is the use of arbitrary power.


James MacKerras Macdonnell: I said "a principle".


Douglas Charles Abbott: That may be a criticism of it; but the principle of the bill on which the house has voted is the principle I set out in closing the debate; and I do not think we should at this time rehash all the points dealt with on second reading, nor do I expect the hon. member for Muskoka-Ontario intends to do that. If my submission is correct; he was quite out of order in reading the quotation. I did not wish to interrupt him; but if he is allowed to do that, then every member in the committee can be allowed to read copious
Foreign Exchange Conservation

quotations on the theory of parliamentary government. I do not believe that would be proper in the committee stage.


William Henry Golding: The principle is not to be discussed when the bill is before the committee; that has been dealt with on second reading when the vote is taken. I believe hon. members generally would like to make as much progress as possible in dealing with this bill. From time to time we have heard many complaints about the rules of the house, and have heard suggestions as to how they should be changed so as to speed up the business of the house. I believe that if we were to abide by the rules of the house as we now have them we could speed up the business of the house very considerably. If one member were permitted to discuss the principle of the bill, then every member would have the same opportunity. I should hope hon. members would not wish to do that.


James MacKerras Macdonnell: I quite agree with you, Mr. Chairman, and I would point out that I was not discussing the principle of the bill. Rather, I was correcting a misstatement the minister had made respecting its principle.


Douglas Charles Abbott: Or what my hon. friend thought was a misstatement.


James MacKerras Macdonnell: At any rate, I have finished that now, and I shall take very little more time. I do not believe what I shall now say has to do with the principle, but it is related to the practice or working out of the bill. I should like to point out what will happen when we begin to work it out-and surely that is a question of detail.
We have before us a most extraordinary power given to a minister-and I shall not take the time to read it. Hon. members will recall, however, that the minister can really make and unmake regulations; he can do anything he likes. I should like to picture briefly what will happen to the business community of this country. In the first place, one has to explain-maybe the government will make a point of it-why there has been so little opposition in the public press and so little complaint made by businessmen. I suggest the reason is that they are afraid.
We all know that the ordinary banker stands in a good deal of awe of the governor of the Bank of Canada, and is careful of what he says. In the same way we have here a man who is able to make and unmake business. Let me picture what would happen and the unfairness of this thing. It is not so bad

for the big businessman -who can come to Ottawa and, if you like, have breakfast with the Minister of Trade and Commerce, and at that time put his case before him. Or, if he finds the minister is not very receptive, he can have an appointment later in the morning with the Minister of Reconstruction and Supply. Then, if he finds he does not get very far with the Minister of Reconstruction and Supply, perhaps he can have lunch with the Minister of Mines and Resources. If that minister is hostile he can have an appointment in the afternoon with the Minister of Transport; and perhaps in the evening, before leaving, he might have a "coke" and ginger ale with the minister of housing.
That is what happens to the man who knows his way around. He is the big fellow who comes to Ottawa. But what happens to the little man? He does not know his way around. In the first place, the expense of coming here offers considerable difficulty. And so we have a situation, which probably was never intended, where he will not be able to have breakfast or lunch with a minister, or have a "coke" or ginger ale with him, or with any of the ministers who occupy the seat in which the Postmaster General is now sitting. That man will be out of luck.
I suggest that is one of the incidents of this legislation. I am sure the minister agrees with me on that, although he may not say so. Incidentally, if I may refer to one further statement by the minister, I believe it will be seen by anyone who reads his speech carefully that the minister was most careful not to say one word in support of this arbitrary power.
There is just one further point I wish to make before asking my questions in detail.


William Henry Golding: If the hon. member would wait until we reach section 6 he would find that that subject deals directly with ministerial powers, and it would be proper for him to speak on that subject at that time. If there is no objection to carrying the title, we could do that and then go on to the clauses.


James MacKerras Macdonnell: I am getting near the end of my remarks if you will give me permission to proceed. I submit to you with deference that it will be found during similar debates in the last couple of years that almost every time the unfortunate hon. member who begins, as I am beginning this debate, has had to undergo a good deal of friendly barrage from the Chair, but that nevertheless the Chair has exercised a certain amount of benevolence toward him.

Foreign Exchange Conservation
The principle so far as I can make out has always been more honoured in the breach than in the observance.
There is one other point which I wish to make and which I think is important, although it has not exactly to do with the working of the bill. It is simply background for the questions which I am working up to and which I want to ask the minister. I think you will agree, Mr. Chairman, that it is not cynical to suggest that this arrangement whereby people have to come to Ottawa, not to get their rights by reason of law but to get their rights by reason of the favour of this many-sided or multilateral minister is one which places them in a difficult position. It is not human for a man to come here and get the permission which he wants and go away and feel evilly disposed toward the minister or toward the party to which the minister belongs. That is just not human nature. I think we should put it on record that this is a perfectly magnificent way to obtain political support. Indeed it does not need much imagination to reach the conclusion that if this kind of thing goes on long enough a situation will arise which might be very desirable for the government. That is, if you had enough power of this kind in the hands of the government it would be almost impossible to defeat the government. It would be like the fascist governments with which we are all so familiar. You would have too many people afraid to speak their minds: you would have too many people becoming just yes-men, and in the end you would find an absolute breakdown of our whole system of government.
I try to use moderate words when I am speaking on a subject of this kind, even though I may not on other occasions, but I think that making the whole business subject to one man is one of the most dangerous and objectionable things which have faced this House of Commons for many days. It is simply war mentality being carried on into peace and I think it is most undesirable.


Douglas Charles Abbott: Would my hon. friend permit me to interrupt for a moment? I want to move that the committee rise before six o'clock in order that I may move certain changes in the personnel of the committee which has just been set up.


James MacKerras Macdonnell: I wish to make just a few comments about the details of the bill. In the first place, we -want to know what the bill is. We understand that a good many changes have been made in it. We know there have been some
and we understand that there have been many more. It seems as though the government-and perhaps we should not be too unsympathetic toward them-j.ust dumped everything in. I think that is what the government did in their hurry, or perhaps in their panic. Since then, they have been giving the matter a more careful look and they have taken out certain things. I hope the minister will now-not later-give us a full statement of the schedules with any changes which have been made. Would it be possible for the minister to do that at eight o'clock?


Douglas Charles Abbott: I have the revised schedules ready. I had thought that I might put them in when we were considering the schedules themselves in the interests of order, but I am quite willing to meet the wishes of the committee on that. While I am on my feet-and I am sure my hon. friend will not object to my answering his question now -may I say that these schedules were not prepared, as he has suggested, in tw'enty-four hours, nor was everything dumped into them. They represented months and months of work by a competent interdepartmental committee.


James MacKerras Macdonnell: I did not say how long the dumping process went on.


Douglas Charles Abbott: I hope none of us desire
to have the reputation of being either a mule or a jellyfish. Obviously changes had to be made when it was shown that it was necessary that they should be made. Because of the very nature of things, advance notice could not be given of these proposals and business could not be consulted to see how they might affect particular trades. My own surprise is that it has been found necessary to make so few. I want to contradict as strongly as I can any intimation that these are hastily considered schedules.
The hon. member for Stanstead (Mr. Hackett) asked how much of our holdings of gold and United States dollars, aggregating 8513,884,563, as announced on January 29, was in gold. The answer is that $296,008,031 was in gold. I move that the committee rise, report progress and ask leave to sit again this day.


James MacKerras Macdonnell: When the committee meets this evening will the minister tell us whether there were any unusual transactions, any windfalls, in the gold situation, whether any gold came in
Foreign Exchange Conservation

from some unexpected sources outside of the North American continent?


Mr. FRASER:: The minister is going to
give us a list of the things that have been taken off. Will he also give us a list of the things that have been put on?


Douglas Charles Abbott: At eight o'clock I intend
to produce schedules which I shall ask to have substituted for those which appear in the printed bill.
Progress reported.


CHANGE IN PERSONNEL OF COMMITTEE
Douglas Charles Abbott: If I might have permission to
revert to motions I should like to move:
That the name of Mr. Maclnnis be substituted for that of Mr. Knowles, and the name of Mr. Irvine be substituted for that of Mr. Nicholson and the name of Mr. Harkness be substituted for that of Mr. Smith (Calgary West) on the special committee appointed by this house to examine and report on increases in the cost of living.


[Stage Direction]
Motion agreed to. -
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock. FOREIGN EXCHANGE CONSERVATION

[Stage Direction]
The house resumed consideration in committee of Bill No. 3, respecting emergency measures for the conservation of Canadian foreign exchange resources-Mr. Abbott- Mr. Macdonald (Brantford City) in the chair.
On section 1-Short title.
James MacKerras Macdonnell: When the house rose at six o'clock I wras just about to conclude some general remarks which I had made and which I explained were made with a view to laying the foundation for some questions that I wished to ask. I said that a good many changes had been announced in the schedules, and the minister intimated that there had been some. He is going to give us information regarding them. I hope he will be able to give us several copies of that information.
The minister took me to task for suggesting that the schedules, and the bill itself, had1 been put together in a hurry. He

explained that it had actually taken several months. I do not know that I committed myself to any time limit. I said I thought things had been dumped into it. I suppose if they were several months at it there was a lot of time to dump things into it. There have been some changes. The minister said that the changes will be listed and we shall know more about them when he gives us detailed information. I hope he will tell us something in particular about the regulations. I understand that the regulations with regard to the entry of capital goods have caused a good deal of difficulty. First of all, I understand that it was proposed to deal with these by individual permits. I heard a little bedtime story. I understand1 that certain people came down, asking for permits. One was that of a happy family where there were a son and a daughter. The little girl wanted a party dress. That was considered non-essential; therefore she could not have it. On the other hand, the boy wanted a winter coat. That was considered essential; therefore he could have it, and that was the principle which should be followed in the case of the permits. I understand that they found it was difficult to deal with them individually and eventually-perhaps I should say now-they are-


Douglas Charles Abbott: That class of goods is not under permit.
Mr. MACDONNELL '(Muskoka-Ontario): Perhaps the minister will have more to say about that later. The way it came to me was this. It was proposed to deal with these things under permit; now they are treating the whole lot by classification. The minister will no doubt tell us about that.


The CHAIRMAN:: I wonder whether the hon. member for Muskoka-Ontario would reserve his remarks on the regulations until we reach section 5, which deals with regulations governing the issue of permits for goods in schedules 2 and 3.


James MacKerras Macdonnell: I do not propose to make any extensive remarks on that. I was trying to recall to our minds just what the particular situation is with regard to this bill before we proceed to go into the details.
The questions that I want to ask are these- I have already asked one of them, and the minister is going to answer it-what changes have been made in the schedules? Perhaps we might deal with that now. Before the minister answers I should like to make this general suggestion to him. I think that, until we get the schedules in their final form, we

________________Foreign Exchange Conservation
really do not know what we are talking about. I am sure the minister agrees with that. The other thing I want to suggest is that in giving us these altered schedules, which I believe the minister is going to do, he should go through them with us so that we shall understand them. He should draw attention to the changes and let us know in a general way the causes of those changes. I realize that might take a little time, but after all, this is an important matter. People's businesses are being affected. Men are being snuffed out of their businesses because a certain item is in here or not in here, as the case may be. Therefore I am sure the minister will agree that we should take time now to go through these schedules, and I hope that he may have several copies of the new schedules. I would ask him to go through them in some detail, and after that I have other questions that I should like to ask.


Douglas Charles Abbott: First, on the question of the schedules, I think the appropriate time to go through the schedules is when we come to them and consider them in detail. Before the dinner recess my hon. friend asked-me to state at this stage, when we are on section 1, what the changes were, and I readily agreed with that, because I think it is important that before we come to the schedules the committee should know in detail what these changes are.
Of necessity, to outline in committee what the changes are is a bit difficult because we have adopted the tariff item technique, if I may so describe it, of indicating the articles which are on the prohibited list in schedule I, on the quota list in schedule II, and on the permit list in schedule III. The changes which have been made are not particularly extensive. They consist almost entirely of taking items from the prohibited list and placing them in the quota list. In other words, there has been relaxation from the original arrangement of schedules I, II and III. Perhaps the most useful procedure for me to follow, so far as the committee is concerned, would be for me to place on Hansard the details of these changes. Schedule I, which is the schedule containing the prohibited items, has been changed by the deletion of certain items, and the following items are to be deleted. I could enumerate them, Mr. Chairman, but they are a list of tariff items. The bulk of them have been transferred from schedule I to schedule II. It might be more useful to the committee if they were placed on Hansard this evening; then they could be studied by hon. members, and we could consider them in detail if we wished to do so. For example, tariff item 26, "coffee, roasted or
ground, and all imitations thereof and substitutes therefor, including acorn nuts, n.o.p." has been removed from schedule I and, I believe, is being transferred to schedule II. I cite that simply as an illustration. I think it would be in the interests of more expeditious and efficient discussion of these items if I were to place them on Hansard and allow hon. members to study them in the meantime before we come to detailed consideration of these schedules.
I agree with my hon. friend that we should take all the time that is necessary or desirable in considering these various items, but with the permission- of the committee I think it would be well if I placed these changes on Hansard, because I am not asking that schedule I be repealed and a new schedule be put in place of it. From the point of view of procedure, I shall move at the appropriate time that these changes be made in these schedules, but for the convenience of the committee I suggest that I might place on Hansard the proposed changes-


Thomas John Bentley: Does the minister not
think it would be better, or at least be more convenient for us, if we had a complete new set of schedules printed with a new bill than to expect us to go through them when they are placed on Hansard and check them with the schedules here?


Douglas Charles Abbott: I could do that very easily, but that would not indicate to hon. members the changes that had been made, and I assume that is what the committee would want. I shall place on Hansard tonight the proposed changes, and then by going down schedules I, II and III we can see what the changes are. For instance, I could go through schedule I of the bill as it now appears and say that item 26, which appears on page 6, has been deleted; that item 29 on page 6 has been deleted; that item 104a on page 7 has been deleted. But in most cases the items which have been deleted from schedule I are being placed in schedule II, which is the quota schedule. At the dinner recess I discussed the matter with my officials, and it seemed to us that if I put on Hansard the deletions from schedule I, the additions to schedule I, the items taken out of schedule I and added to schedule II, that is the quota schedule, and the additions to schedule II as well as the additions, if any, to schedule III, the committee would then be able to see, by comparing that list with the schedules as they are printed in the bill, just what changes have been made since the bill was introduced. I am in the hands of the committee and I shall do it in the way that is deemed most convenient.

Foreign Exchange Conservation


Mr. MANROSS:: Would the changes in Hansard show where the items are transferred to?


Douglas Charles Abbott: Yes. The method is to use the tariff item technique, and all tariff items are numbered, so that if you look at tariff item 26, which is deleted from schedule I, and look in the list of items added to schedule II and see that item 26 is placed in schedule II, it at once appears that the item has been transferred from schedule I to schedule II. It sounds complicated, I know, but I really think that would be the method which would prove most useful to the committee.


Park Manross: It would be easier if it were noted, "transferred from schedule I''.


James MacKerras Macdonnell: As I understand it, by putting it on Hansard the minister means handing the document to the reporter without reading the items, and we shall know nothing more about it until we see it in Hansard tomorrow morning.


Douglas Charles Abbott: Tomorrow afternoon we
shall be resuming the debate on the address, and it seemed to me that tomorrow would give hon. members an opportunity to analyse these changes and to be ready on a subsequent occasion to discuss them. I can summarize the changes that have been made. There have been fifteen changes in schedule I, seven in schedule II and three in schedule III.


James MacKerras Macdonnell: That is not a formidable list, but it seems to me that we can study these items much more intelligently afterwards if the minister would now take time to go through the list, picking out those that are changed and giving us briefly the reasons for the change, and when we come to Hansard we shall have the whole story. In the end it would save time. I suggest that if we know in advance the reasons it may save a lot of unnecessary questions later on.


Douglas Charles Abbott: Broadly speaking, the
reasons can be summarized in this way. The items in schedule I, the prohibited list, which are transferred to schedule II, have been transferred because these are the items of which there are substantial exports from the United Kingdom or sterling areas, which export's it is desired to encourage. It has been found possible to transfer these from the prohibited list to the quota list. That is one of the main reasons why, after looking into all the various circumstances, it has been found desirable and appropriate to transfer items from the prohibited schedule to the quota schedule. That perhaps is the principal

reason. There may be special reasons for special items: for instance, toilet soap and castile soap. Castile soap, as I suppose many members know, comes from France. France is a country to which we have made advances and we are anxious to stimulate trade with that country. It has been found possible to transfer that item from the absolutely prohibited list to the quota list. I am using that by way of illustration. Without going into details, the tariff items which have been transferred from schedule I are: Coffee, roasted or ground-


An hon. MEMBER:: Would the minister give the numbers?


Douglas Charles Abbott: I think it would be helpful if I put this on Hansard. I will summarize it first: coffee, roasted or ground; coffee, green; toilet soap; castile soap; shoe blacking-we get a lot of shoe blacking from the United Kingdom, the kind we used to get during the first war-toilet or dressing combs. Torpedoes, firecrackers and fireworks of all kinds, paintings in oil or water colours and pastels are deleted entirely from the schedule. At present these are all on the absolutely prohibited list; [DOT]but we found on inquiry, and following representations, that a good many paintings and works of art were exported to this country by dealers in the United Kingdom in particular and that there was a very large volume of tourist purchases of these items. It was clear that, on balance, we gained more dollars by allowing imports of that specialty product, if I may so refer to it, into Canada and removrng it from the prohibited list. I am using that as an illustration. Only a few items have been added to the prohibited list. It is really a change of wording. It is in the paper group: papers and paperboards or fibreboards the surface of which is in two or more colours or is embossed or otherwise decorated. Empty containers wholly or partially manufactured from paperboards or fibreboards having affixed thereto paper the surface of which is in two or more colours, or is embossed or otherwise decorated.	.
These descriptions are rather technical and if we go through them one by one I can give to the committee the explanations for the changes. I have indicated, without giving the tariff item numbers, the items which have been deleted from schedule I, that is the prohibited list, and the majority of the items which have been deleted from schedule I have been included in schedule II, the quota list.


Thomas John Bentley: And there are only
fifteen?	1 i


Douglas Charles Abbott: There are fifteen items removed from the prohibited list.

Foreign Exchange Conservation


An hon. MEMBER:: How many new ones have been added?


Douglas Charles Abbott: There have been in fact no new ones added. The paper item which I have read has been reworded and, as a result of the rewording, the scope may be somewhat extended. I am informed that the intention is to catch the fancy boxes, if I may use that expression. There are certain specialty types of fancy boxes that are imported into the country and the change in the wording is intended to include these fancy boxes in the prohibition.


James MacKerras Macdonnell: I presume that when this was worked out the minister of necessity had a figure of hoped-fot savings of United States exchange which he attributed to each item. Is there any estimate of any kind?


Douglas Charles Abbott: No. There is no intention of doing that at all. As I said just before the dinner recess, these schedules were prepared after a great deal of study by the technical people who are familiar with these things. But for reasons which I think are obvious, of necessity they were prepared without an opportunity of consultation with those who were directly concerned with the import trade involved. As a result of representations which have been made to me and to the emergency import control division since the schedules have been announced, and as a result of information which has been obtained as to the effect on importers and the economy generally, certain changes have been made. But no particular consideration has been given as to whether the change will result in a saving of a particular amount or otherwise, except for this; no change would be made which it was felt would result in a substantial impairment of our United States dollar position on balance.


James MacKerras Macdonnell: I do not want to be too persistent about this, but I confess that I am a little bit surprised. After all, the government figured out a suggested amount which they hoped they might save. I have forgotten just what it was

$300 million to $500 million, if I remember correctly. It is hard for me to understand just how that was arrived at unless some pencil work had been done. While I appreciate fully what the minister says, to the effect that they could not take the business community into their confidence, nevertheless I should have thought that, with the elaborate statistical department we now have, these figures would be available. I
confess myself to be much surprised that no figures of any kind are given. How is that total made up?


Douglas Charles Abbott: That is simple. I think I stated in the press conference which followed the announcement of these restrictions that, on the basis of importations during the preceding year, if importations were continued during the current year at the same rate as during the last year on all these items, the savings would be in the vicinity of $300 million. Obviously any figure of that kind, so far as the future is concerned, cannot be better than an estimate. But if my memory serves me aright, I said that if we had continued to import the products, under schedule I, which are now prohibited, at the rate we had imported them during the preceding year, and if we had continued to import the products which were on the quota list at the same rate, without these restrictions we would have imported $300 million more, which is obviously an estimate; but it was the best estimate one could arrive at.


James MacKerras Macdonnell: I can understand that the estimate had to be a rough one, but I still submit that there is a great difference between an estimate and a guess. If I understood the minister correctly, what he said was that there was nothing more than a guess.


Douglas Charles Abbott: No. I said that was an estimate.


James MacKerras Macdonnell: You called it an estimate; but if in fact-


Douglas Charles Abbott: If my hon. friend can tell me at the beginning of January, 1948, that we shall import during 1948 exactly the quantity of goods that were imported in 1947, he is a better man than I think he is.


James MacKerras Macdonnell: I would not say that at all.


Douglas Charles Abbott: That was the only forecast I made.


James MacKerras Macdonnell: Surely, when you have the figures with regard to the importation of a certain article in the year 1947, you have the figure as to what you may hope to save in 1948. That is what I am asking for.


Douglas Charles Abbott: That is the figure I gave.


James MacKerras Macdonnell: No. I am asking that we have that by items. You must have that.


Douglas Charles Abbott: We can give you that information, but I think it would be better to
Foreign Exchange Conservation

do it when we come to the schedules. But we can take up the various items, item by item. I can tell my hon. friend what we imported under each item. Obviously it is a matter of public record. I can say that if we imported the same amount of tariff item 26 in 1948, we would spend so much on the item. I can go through these items in that way, item by item.


James MacKerras Macdonnell: I have no desire to waste time, but that is exactly what I want. I think, if the minister will give us that, it will be simple with regard to schedule I; it will not be so simple with regard to schedule II and it may not be possible at all with regard to schedule III. But I suggest that the minister might give us what he could with regard to schedule II. I imagine it could be done. When we come to schedule III where discretion enters in, I do not like to suggest offhand what can be done, but I feel sure that something can be done.


Douglas Charles Abbott: That information can all be made available and will gladly be made available if the committee wants it when we come to schedules I, II and III. But obviously that is a matter which will take some time. The data is all available, but it is lengthy. I think we should do it when we come to the schedules, not when we are discussing the short title of the bill. It is not a matter for argument; it is purely a matter of statistical fact which is ascertainable by looking at the customs entries for 1947 and seeing how much they are. There is not any argument about it. I know my hon. friend appreciates that.


James MacKerras Macdonnell: Yes, I appreciate that.


Douglas Charles Abbott: It is not a matter that we need to quarrel about at all.


James MacKerras Macdonnell: I agree with the minister that we need not ask him to do all that for us now; it can be done tomorrow.
The next question that arises is a much 'more difficult one. In schedule II, I understand that certain quotas have been given, and they are based on purchases over a basic period. Then we come to schedule III, and I am still more perplexed because there you have a wide-open discretion. What changes have been made in the items of schedule III? After the minister has answered that, I should like to ask him another question.


Douglas Charles Abbott: Yes. I can give my hon. friend the changes which have been made in schedule III. So far as detailed inquiry is concerned with regard to schedule III, I may say that will be dealt with by my colleague, the Minister of Trade and Commerce (Mr. Howe) who is unfortunately not able to be

here this evening. But I think we have plenty to occupy our attention in schedule I and II if we reach them.
Item ex 238a which is described as follows has been added at the commencement of schedule III:
Cinematograph or moving picture film negative one and one-eighth of an inch in width or over.
I do not pretend to be able to tell the committee why that has been added. There is, I am informed, a good technical reason for adding it. I think my colleague, the Minister of Trade and Commerce, will be able to tell the committee more clearly why that should be the case. That is the only item which has been added to schedule III.


Gordon Knapman Fraser: What is that number?


Douglas Charles Abbott: It is described as ex 238a.


Gordon Knapman Fraser: On January 28 there was a custom notation on import restriction. It is marked 427h and its motion picture projectors for use with film one and one-eighth inches or over. Would that cover the same thing?


Douglas Charles Abbott: This is the film itself we are referring to, not the projector.


Gordon Knapman Fraser: This covers motion picture
projectors.


Douglas Charles Abbott: This added item is the film itself, not the projectors.
Then two items identified by the following numbers are to be deleted, and the items which I shall refer to are to be substituted. Instead of item ex 415 as it now appears in schedule III, the following is to be substituted:
Electric vacuum cleaners and attachments therefor; hand vacuum cleaners; and complete parts of all the foregoing for production use.
Then item, ex 427h is to be deleted as it now appears in schedule III, and the following is to be substituted for it:
Motion picture projectors for use with film one and one-eighth of an inch in width or over; electric rectifiers or generators designed for use with such motion picture projectors; arc lamps for motion picture work, motion picture or theatrical spot lights, light effect machines; not to include electric light bulbs, tubes or exciter lamps; complete parts fo-r production use of motion picture projectors arc lamps for motion picture work, motion picture or theatrical spot lights, light effect machines, motion picture screens, portable motion picture projectors with or without sound equipment, and electric rectifiers or generators designed for use with motion picture projectors.
That is the end of the description of the amended tariff item. These are the only changes which have been made in schedule III as it appears in the bill before the committee.

____	Foreign Exchange Conservation


James MacKerras Macdonnell: Then, if we take these it is understood we shall have the new schedule put on Hansard; the minister can give us these figures of expected savings on the various items and that, will apply to schedule I and schedule II.


Douglas Charles Abbott: I have not given the particulars yet on schedules I and II, except in the most general form. As I have said, fiften items are being deleted from schedule I. There are seven added to schedule II, and there are these very minor changes to schedule III. I could ask the officials to make some estimate as to what may be the effect on balance in savings or otherwise of United States dollars as a result of these proposed changes. I do not think it will be substantial; I think the changes are more in the nature of relaxing in order to facilitate the importation of certain goods from soft currency areas. I do not think the effect on balance would appreciably change the estimate of approximately $300,000,000 which I gave in the press statement following the announcement. The changes are intended to facilitate the easier flow of trade and more particularly to assist or at least not to impede the importation from sterling areas of goods which can be properly brought in.


James MacKerras Macdonnell: At any rate, if the minister gives us the details for each item, both those appearing in the bill and the new ones, we shall be able to make an estimate for ourselves.


Douglas Charles Abbott: It might be of assistance to the committee if I were to place on Hansard, for study tomorrow, a summary of the changes ini schedule I, II and III, If that is on Hansard hon. members can take the bill as it is printed; each of these changes will be identified by a tariff item number, and they can turn up each one in schedule I, II or III, as the case may be, to see exactly what the change is.


James MacKerras Macdonnell: That is quite satisfactory to me.
The CHAIRMAN; Then is it agreeable to the committee that the minister shall have leave to place this statement on Hansard?


Some hon. MEMBERS:: Agreed.


Douglas Charles Abbott: Then I formally place on Hansard a statement outlining the changes to which I have just referred. The statement is as follows:


SCHEDULE I
[Stage Direction]
The following items to be deleted:
26 Coffee, roasted or ground, and all imitations thereof and substitutes therefor, including aeorn nuts, n.o.p.
29 Coffee, green, n.o.p. (not imported direct from the country of growth and production.)
ex 228' Toilet soap.
230 Castile soap.
252 Shoe blacking; shoemakers' ink; shoe, harness and leather dressing, and knife or other polish or composition, n.o.p.
652 Toilet or dressing combs, n.o.p.; fancy combs, not being jewelry.
665 Torpedoes, firecrackers and fireworks of all kinds.
The items identified by numbers below to be substituted:
ex 69'5 Paintings in oil or water colours and ex 695a pastels (not to include paintings in oil or water colours and pastels to be used exclusively for printing or lithographic reproduction purposes).
The following items to be added after item 19/6:
ex 192 Papers and paperboards or fibre-ex 197 boards the surface of which is in two ex 198 or more colours or is embossed or ex 199 otherwise decorated, ex 199b Empty containers wholly or partially manufactured from paperboard or fibreboard having affixed thereto paper the surface of which is in two or more colours, or is embossed or otherwise decorated.
deleted and the items set opposite them to be
Deletions	
104 a) ex 104 a	
105	J ex 106
124'	124'
125	125
126	
127	127
128	128
	ex 123
	ex 133
ex 326g
624 et al
ex 656a
i a. x uiu
5 crushed
Oysters
Substituted items
m0tfhrozenlan PaSsion fruit PulP>
with sugar or not,
and fruits
624) et al)
, tnermal shock resisting glassware, but not including industrial nr laboratory glassware or glassware parts imported by manufacturer for production use in their awn factories	mure™ tor
Bead ornaments, and ornaments of alabaster, spar, amber terra cotta composition or other material except china or porcelaffi/ fans of kinds; statues and statuettes of any material other than porcelain or
earthenware.
ex 655a Propelling pencils
extraetorT",rto"be* d*eleteffiS" Where " aPPearS " "" 17 °n page 13 of Bil1 3 after words
juice
Foreign Exchange Conservation

[Stage Direction]
The following gory 4:
items to be added to cate-
230
362
Toilet
combs,
Soap powders, powdered soap, mineral soap, and soap, n.o.p.
Castile soap.
Shoe blacking; shoemakers' ink; shoe, harness and leather dressing, and knife or other polish or composition, n.o.p. Articles consisting wholly or in part of sterling or other silverware, n.o.p.; manufactures of gold or silver, n.o.p.
or dressing combs, not being jewelry.
n.o.p.; fancy
The following items to be added to category .5:
26 Coffee, roasted or ground, and all imitations thereof and substitutes therefor, including acorn nuts, n.o.p.
29 Coffee, green, n.o.p. (not imported direct from the country of growth and production) .

[Stage Direction]
The following item to be added at the commencement of the schedule:	...
x 238a Cinematograph or moving picture film negatives one and one-eighth of an inch in width
or over.
The items identified by numbers below to be deleted and the items set opposite them to be substituted;	„ .	, , .,
Deletions	Substituted items
ex 415	ex 415 Electric vacuum cleaners and attachments therefor; hand vacuum cleaners;
and complete parts of all the foregoing for production use. exz427h	ex 427h Motion picture projectors for use with film one and one-eighth of an
inch in width or over; electric rectifiers or generators designed for use with such motion picture projectors; arc lamps for motion picture work, motion picture or theatrical spot lights, light effect machines not to include electric light bulbs, tubes or exciter lamps; complete parts for production use of motion picture projectors, arc lamps for motion picture work, motion picture or theatrical spot lights, light effect machines, motion picture screens, portable motion picture projectors with or without sound equipment, and electric rectifiers or generators designed for
use with motion picture
Mr. LOCKHART:: Have any of the quotas been increased?


Douglas Charles Abbott: No.


James MacKerras Macdonnell: I am afraid I did not make myself clear in what I was asking the minister. I assume the statement he has placed on Hansard will not have the relevant amounts which he is to give us. Those will be furnished separately, I take it?


Douglas Charles Abbott: No; the statement will not give any indication as to what change, if any, there would be in the estimate I gave earlier as a result of these restrictions.


James MacKerras Macdonnell: I am sorry; I have not yet made myself clear.
I understand that the minster is to give us the expected saving with regard to each item in the schedule as it is now. Do I understand correctly?


Douglas Charles Abbott: That can be done. My assistant deputy minister advises me that this will cover at least fifteen pages of double foolscap. That can be made available, and I would gladly make it available if the committee wants it, but I hope I shall not have to read it all. That data is all available.


James MacKerras Macdonnell: I do not want to ask for anything that will mean a lot of unnecessary work. I thought we were to get that. I have before me schedule I, which is quite short, covering only seven or eight pages. I do not understand why it should be such a tremendous affair.


Douglas Charles Abbott: It is not. I have all the data here, but it is of considerable length. I have
projectors.
here schedule I, the prohibited list, with the estimated total savings. It covers eight of these large sheets, with items varying from
S3,000,	for instance, under item 7, beef and veal fresh, to 81,611,000 under items 9 and 9a. It goes all through a long list of tariff items, with the estimated savings, those savings being computed purely on the assumption that imports this year would be at exactly the same rates for these items as they were last year.


James MacKerras Macdonnell: Well, I have one or two other questions I should like to ask the minister. He gave us some figures with respect to the results to date which certainly sounded encouraging. He told us that the holdings of United States dollars and gold, while, I think, going down to a low in December, had come up at the end of January. That leads me to ask these questions. Of course it is very natural that there would have been a bit of a breather after the virtual run on United States exchange which took place before November 17. These are the questions I wish to ask: the exports and imports to and from the United States in December, 1946, in December, 1947, and in January, 1948. The reason I ask for this information will be obvious; to show whether exports and imports in the two relevant months, December, 1947, and January, 1948, look normal or whether they look in any way abnormal. It seems to me that will help us make up our minds as to exactly what the situation is.


Douglas Charles Abbott: As my hon. friend knows, the December figures were published about a

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week or so ago and are on record, though I do not have them with me at the moment. The January figures will not be available for another three or four weeks. The December figures are a matter of public record, available to every hon. member of the house.


James MacKerras Macdonnell: The minister is right on that, of course; but he gave us a figure, I think to the end of January.


Douglas Charles Abbott: January 29.


James MacKerras Macdonnell: Presumably he has the figures of exports and imports, even if they are not for the full month.


Douglas Charles Abbott: No, I have not, and they will not be available for two or three weeks. I have the figures as to our daily exchange position, but those are not the figures on exports and imports.


James MacKerras Macdonnell: I see. Then you suggest that we cannot get any figures at all at the present time?


Douglas Charles Abbott: Those figures are compiled from the returns received from the hundreds of customs ports across Canada. They cannot be available on twenty-four hours notice. There is always a lag of three or four weeks.


James MacKerras Macdonnell: But the foreign exchange control board must have the figures, because both export and import transactions are known to them. Certainly they know about the imports, because they furnish the exchange. I wonder if they do not have some means of knowing the export figures too and if we cannot get a rough and ready figure, not the last word but a working figure, up to the end of January. Will the minister look into that and see what can be done.


Douglas Charles Abbott: I shall look into that; but I am sure that, so far as identifying it with a physical volume of goods, the foreign exchange control board could not very well have more rapid or up-to-date information than the customs branch which acts as its agent in these matters. Therefore I consider it most unlikely that we would have more up-to-date figures on the physical volume of imports from the foreign exchange control board than we *would have from the Department of National Revenue, customs division. However, I shall make inquiries.
I can and do obtain weekly reports as to the exchange holdings of the foreign exchange control board; but there are forward commitments; and, while it is the intention, it does not necessarily follow that we will have the
day-to-day volume of trade imports, because there are invisible items such as settlements in respect of transportation, and so on.
If my hon. friend buys a ticket today in Canada to go to Miami for a couple of weeks he can buy it in Canadian funds, but Canada will have to settle for the United States mileage portion of that ticket in United States funds.


James MacKerras Macdonnell: I shall not press the point, but I do say that while there may 'be a time lag, it is the same time lag all the time, and I think the day to day records of the foreign exchange control board reflect pretty well what is going on.


Mr. GREEN:: There is one feature of this exchange conservation plan which seems to me very unfair, and I am hoping the minister can do something to remedy it. I refer to the way in which quotas are determined. Apparently the basic period is for the year preceding June 30, 1947. This has meant that in many instances people have been unable to qualify because they started in their businesses perhaps late in 1946 or early in 1947. I know it has hit several veterans very hard, and I do not understand why that period could not have been the twelve months preceding October 31 rather than June 30.
I notice in tonight's press that the quota for automobiles has been based upon the twelve months period ending October 31, 1947. I would ask that the quota for all goods be worked out on the same basis. It seems only fair that that should be done.


Douglas Charles Abbott: The explanation of the point raised by the hon. member for Vancouver South is that when the import restrictions were put on, the June 30 figures were, the latest for which full information was available. The figures for October 31 were not available at that time. As the committee knows, in respect of automobiles imports at the outset were prohibited, pending the working out of a quota. The quota in respect of automobiles had to be ascertained on a basis somewhat different from the others. Returned men are given consideration up to November 17, so far as imports are concerned. As I believe I said in reply to an interjection during the debate on second reading, a special quota figure has been reserved in order to .take care of returned men who did not have a basis of performance in the previous period. I believe there is ample provision under the arrangement to take care of the returned men.; and, as I say, they are given consideration for their imports right up to November 17.
Foreign Exchange Conservation

But they are a special case. I repeat that the June 30 date was taken because that was the latest date for which figures were available when the restrictions were put into force.


Howard Charles Green: That might have been all right at the time; but now that we have the legislation before us, would it not be wise to follow the suggestion I have made?


Douglas Charles Abbott: The difficulty is that quotas are set. They have been operating since November 17. We are now in February, discussing the legislation. So that it would be pretty difficult to adopt literally my hon. friend's suggestion. I do not think the basis of performance up to June 30 is an unfair one, because the volume of imports, during the year which ended: June 30, 1947, was at an all-time high for this country. I do not believe there is anything wrong in that basis.


Howard Charles Green: It seems to me that that is looking at the problem from the point of view of the officials who are administering the plan rather than from the point of view of the man out in the country who is being hit. Surely his quota should be based upon the goods he imported in the year immediately preceding the time these' restrictions went into effect.
. Mr. ABBOTT: One reason why I personally would object to using that basis is that during the last month or two, before these restrictions were imposed, there was a terrific acceleration of imports from the United States. Many people thought the restrictions were coming on, and there was a rush to bring stuff into the country. I believe that the last month or two before the restrictions were put on would represent a completely distorted picture of the normal imports into this country; and I think it would be wrong to use as a basis the period just before these restrictions became effective. I believe that is a pretty compelling reason for using June 30 as the date.


Howard Charles Green: That may be all right for the big fellow, the fellow who was smart and perhaps got a hint from somewhere that this plan was coming into effect-


Douglas Charles Abbott: Nobody got a hint from anywhere. No innuendoes of that kind, please.


Howard Charles Green: If the minister is putting the quota on its present basis for that reason, then I say it is punitive; it is not fair at all. I am referring to the case of the small man in business in Vancouver or Halifax who had not the remotest idea that this plan was to be brought down. He carried on his business in the regular and ordinary fashion. Then he suddenly found that a quota was put on and that, instead of its applying up to November

17 or the end of October, he is cut off at the end of June. I know of several cases in which there has been the utmost unfairness as a result. Those men can get no consideration from the department. If in a bona fide case they can be given consideration, all right; but I suggest that there is hardship at the present time and that, because of the way in which these quotas are being administered, these men can get no help.


Douglas Charles Abbott: I am informed by the assistant deputy minister, who is head of the emergency import control division, that we have had almost no complaints as to the fairness of the June 30 date. There have been questions raised by veterans who have gone into business at a later date and, as I have already said, special provision has been made to take care of them. But in respect of the ordinary importer I can see no unfairness in using that date. It is just as fair for one as for another. I think, myself, that the period ended June 30, 1947, represents a high level of import so far as this country is concerned, and I believe that any attempt to use another date would create more unfairness than the date now used. As I have said, veterans are treated as special cases; but I repeat I have been told that we have had almost no complaints as to the fairness of using that date.


William Ross Macdonald: May I draw the attention of the committee to the fact that we are mow considering section 1, short title. It seems to me that the committee would make more progress if it abided by the rules of the house and considered matters as they appear in the clauses. For instance, the question which we have been discussing could properly be discussed under section 5 (1) (b), the latter part of which reads:
. . . and the method of calculating the quotas, or prescribing the circumstances in which permits may be issued to applicants therefor.
I ask hon. members to discuss the bill clause by clause.


Mr. SKEY:: I think, Mr. Chairman, you will find that the references which I have to make are in order because they are general in nature. I should like to refer back to the time when I spoke on this bill when I had an exchange with the minister, in part humorous and in part serious. The minister has done me the honour of dealing with one of the recommendations that I made to him when he replied, as reported on page 705 of Hansard. However, he did not deal with one other recommendation which I made at that time and I should like to give him an opportunity

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of dealing with it now. I think he will welcome this opportunity in view of the remarks made this afternoon by the hon. member for Muskoka-Ontario when he referred to the difficulty that certain businessmen met when approaching the government with their problems and the new situation in which they found themselves.
I recommended to the minister that he should call to Ottawa some of those in the country who are skilled in commerce and export and import matters. I recommended that he consult with boards of trade and chambers of commerce in Canada. The minister has said that prior to the bringing in of this measure they had no opportunity to do that, but I ask him what action he or his departmental officials have taken, since the bringing in of this measure, to consult these experts in the country.


Douglas Charles Abbott: That is extremely easy to answer. I think on the average I personally see at least six or seven representative delegations in the course of a week. Today I had a delegation from brush manufacturers and I have had delegations from electrical manufacturers, furniture manufacturers and others. I think it is fair to say that I see at least ten or twelve delegations a week. They come to my office with extremely well prepared briefs which outline the problems of their particular industry. Of course I receive them with my customary courtesy and I listen to their stories. I am very glad to have these representations made.
In addition to the delegations that I see, the officials of the emergency import control division and other officers of the Department of National Revenue or the other departments of government concerned with the administration of this program see literally hundreds of representatives of business and industry. I think it will be found that the reception which these Canadians received was sympathetic and considerate. My friend, the hon. member for Muskoka-Ontario shakes his head-


Mr. SMITH (Calgary West):: He was agreeing with you.


James MacKerras Macdonnell: On a question of privilege, I was agreeing with the minister. I am sure that the minister was so courteous that he made it as painless as it could be made.


Douglas Charles Abbott: I thought the hon. member was shaking his head from side to side and not up and down. I apologize to him. Speaking personally, and I know that this applies to the officers of the department, representa-5849-69
tions from organizations such as my hon. friend has suggested are not only welcomed, but are necessary for the effective administration of any law of this kind. They are the same sort of thing that I get month after month during the year with respect to matters which affect the budget. That is the way in which our system works.
Boards of trade, chambers of commerce and trade groups of one kind and another are constantly making representations to the government. I can assure my hon. friend that he need have no concern over the reluctance of organized groups of this kind to bring their cases fully and clearly before the government. I am glad that they do, and he need feel no concern over the fact that the points of view of all groups are not fairly presented to the government.


Lawrence Wilton Skey: I am sure that many in the country will be pleased to know that they are so welcome in Ottawa and will always receive the sympathetic and non-political treatment which they appear to be getting.
However, I should like to come to the other side of this question. This is an emergency exchange measure. When I spoke before, I asked the minister if he had consulted those in the country who were skilled in exchange matters. We have the minister's answer with regard to import and trade groups, but what about those skilled in finance and exchange? Has the minister interviewed the bankers' association or representatives of the Montreal, Toronto and Vancouver stock exchanges? Has he met with the boards of directors of any of the banks? Are they in agreement with the action the government has taken in this case?


Douglas Charles Abbott: 
Lawrence Wilton Skey: That is not the question.


Douglas Charles Abbott: Let me make that perfectly clear.


Lawrence Wilton Skey: I was referring just to consultation.


Douglas Charles Abbott: That is all right. The government is always willing to listen to the representations of any group in this country that may be interested either in promoting the public welfare or in promoting its own particular interests. That is part of our system and ministers of the crown and the government are always ready to listen to


Lawrence Wilton Skey: The minister has suggested
in his reply that I was advocating that he should ask the advice of these various organizations. That was not my idea at all. 1 was merely asking the minister if they had been asked to give their views to the government in the same friendly way as the traders previously mentioned. It seems strange that we have the minister describing the welcome given to the trade delegations and import people, but when we come to the question of finance and the management of currency and exchange the minister shows some heat.


Douglas Charles Abbott: The minister never shows
heat.


Lawrence Wilton Skey: He showed some heat.


Douglas Charles Abbott: Oh, no, never.


James MacKerras Macdonnell: The minister always has the same complexion?


Douglas Charles Abbott: It is just the temperature.


Lawrence Wilton Skey: My question still remains
unanswered. Has the minister had representations from the heads of the various financial otganizations and has he had their opinion with regard to the measure now under discussion?


Douglas Charles Abbott: If one may judge the published annual reports of most of the chartered banks, they appear to approve the action which the government has taken.


Lawrence Wilton Skey: Oh, oh.


Douglas Charles Abbott: My hon. friend may smile, but I have read the reports. Perhaps he might usefully dio so. These reports are pretty capable documents. If he reads them carefully he will find he gets a lot of useful information from them. I do not think there is any criticism of the action which the government has taken on this particular issue.


Arthur Leroy Smith: May I compliment the minister on his eloquent presentation of the elementary principles of responsible government. You know sir, one needs to attain a professorial attitude to give us the great truths that he gave us just now which, of course, we all learned in the first grade when we went to school.


Douglas Charles Abbott: Not all.


Arthur Leroy Smith: Quite apart from that, I have three questions to ask, but, first-, with respect to the minister's answer about the statements of the banks, may I say that they were prepared, although not published, long before he took the measures he is talking about.


Douglas Charles Abbott: Not all of them.


Arthur Leroy Smith: I want to ask three simple questions, not in the realm of high finance which we have been dealing with just recently because I confess I do not understand large figures. I know something about refrigerators; I know something about fireworks, and I know something about one other subject. I want to ask the minister a question first about fireworks because, if I heard him correctly, he mentioned that fireworks had! been taken, from the prohibited list and put on a quota basis. I understood him to say that just a moment ago. I speak to him now on behalf of am organization known as The Calgary Exhibition and Stampede. I wrote him a letter about the matter today; at least I was sent a copy of a letter that was sent to him. Perhaps, sir, knowing as you do how wonderful our facilities are for getting our mail out I should have said I dictated a letter today. I may send it out in the course of the next couple of weeks, granted that I get it back agaim-I do not know so much about that. But may I assume from what he said a moment ago that this government would1 grant an expenditure of $7,500 to the one event in. the Dominion of Canada, by way of entertainment, including your Toronto exhibition-


Lawrence Wilton Skey: The Canadian. National.


Arthur Leroy Smith: All right. This is the first time I have ever known anyone from Toronto who would not accept credit even though it was not due. They call it the Canadian National. What I am saying is that the exhibition at Calgary attracts more real United States dollars than any other single event in the country. It is a matter of great importance, not national importance -I am fed up with this naticnal business. We

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heard something today about somebody seeed^ ing out there; I am nob going to secede. It is a greait show in our own area, and I think the people sitting in front of the minister will agree that no other single event in Canada attracts the United States dollars which the Calgary stampede does; therefore I am simply making a plea that 87,500, which will bring back fifty times as much, be granted. I am not expecting an answer to that at the *moment because, as I say, I have written.
These other two matters I have taken up with the department or departments. The first has to do with refrigeration. I was very happy to hear the minister tell the House of Commons how courteous he was to everybody who came to see him. In order that he should not be lonesome on that pedestal may I immediately thank those under him in his department and in the Department of National Revenue for the great courtesy they have shown me in invariably turning me down in everything that I asked them to do.
I want first to deal with one incident which I think is entitled to consideration. May I, Mr. Chairman, say that I do not mention this or the next item in the House of Commons without first having done my best by correspondence with the department to get for these people what I think is simple justice. I tell you this simple story. There is a small outfit in Calgary which makes casing for refrigeration; that is, the wood, the furniture and the fittings that go with it, and they buy their refrigeration in Los Angeles. I think it was the evening of November 17 that the Minister of Finance, quite illegally, of course, pronounced his edict that things ended as of the date when Caesar spoke, or whatever the proper expression is.


Douglas Charles Abbott: Whatever you want to call
it, yes.	__


Arthur Leroy Smith: 
Douglas Charles Abbott: That was the tax.


Arthur Leroy Smith: Excise tax.


Douglas Charles Abbott: That is another resolution ; that is not this bill.


Arthur Leroy Smith: I am sorry, but I shall not repeat it. Do not forget that I mentioned it on this bill.
The other question which comes to my attention and I may say it is among a very great many has not to do with the excise tax; it has to do with prohibition. In the city of Calgary from which I come-and I am glad to see the Minister of Fisheries here; you see, he is our very good neighbour, and lie is going to give us a fishing pool in the city square there and breed his own kind of MacKinnon trout; we have that all arranged-* there is the only concern in the Dominion of Canada which is engaged in the manufacture of billiard room or poolroom and bowling equipment. I want to mention this particularly with reference to the exceptions which the minister said were being made in favour of the returned man.
A very fine gentleman by the name of Mr. Taylor wrote back the most pleasing letters, but at the end I found I was exactly where I started and perhaps a little more behind the
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eight ball than I thought I was when I began. This is the situation, and I want the house to get it. So far as I can learn, they are the only outfit in the Dominion of Canada engaged in the manufacture of bowling balls for alleys.
I do not know how many hon. members have engaged in the game of bowling, but it is very general throughout the country. The greater part of that equipment is supplied by the Brunswick-Balke-Collender Company. I do not know what the "collender" means in connection with bowling. I had thought it was something my wife used for straining things when making salads. As I say, I do not know what it means in this connection, but they supply practically the whole of that equipment in the dominion.
This little outfit had a capital of $35,000, all paid up. It was composed of a returned veteran and his brother-in-law. This returned veteran had a splendid record overseas. I mean a combat record; I do not mean one of the chaps sitting at a desk with a pencil, blue-pencilling other people's ideas. I mean a man who was fighting. He used his gratuity, a government loan, a loan on his insurance and a loan from the bank and raised $17,500. His brother-in-law put up the remaining $17,500.
I thought he was entitled as a returned veteran to special consideration, but I was informed by the department that he was not so entitled because he owned only 50 per cent, with his brother-in-law, who is not a returned man. Where are you going to draw the line? Must the veteran own 100 per cent, or 90 or 80 or 75 or 50 per cent? Where do you draw the line? The simple fact is that there was an outfit doing something for business in this country and in a very short time succeeding quite well. They were original people, the sort of people we want here, people who were doing something for this country, providing employment for thirty-five persons. Today they are practically out of business, certainly so far as a large proportion of their business is concerned, because they are unable to import certain things required in that business; for example, the wood from which these bowling balls are made.
I would not mention the matter in the house had I not placed all the facts before the department. I have the correspondence, and these people have been turned down on that basis.
I hate strong language or exaggerated language, but I do say this. They are facing ruin aft the present time and the Brunswick-Balke-Collender Company are taking over the business. They had opened up branches in Regina, Prince Albert and Edmonton, and

today they have to close them because, through this stupid and unfair regulation, the business is being handed to this great company which practically controls that industry throughout the whole continent of North America.
I would not have mentioned these things, but they are not really of local interest merely. That is the attitude that has been taken, that a man owning 50 per cent, and having borrowed in every place he could, is not entitled to some form of import quota. If that is the case, then 'heaven help us and let us throw the rest of the 'business to people comparable with the Brunswick-Balke-Collender Company of the United States of America.


Douglas Charles Abbott: With regard to the matter raised by my hon. friend, point number one is that this firm never imported anything before June 30 of this year.


Arthur Leroy Smith: They were not in business.


Douglas Charles Abbott: That is right. My hon. friend has stated the facts correctly. The business is owned 50 per cent by a veteran and 50 per cent by a non-veteran. I did not know it was this veteran's brother-in-law. This is no doubt a perfectly genuine case, but it is very easy for anyone to use a veteran as a stalking horse in order to get special quotas under an arrangement of this kind or any other special provisions such as we had during the war.


Arthur Leroy Smith: I told you what this veteran did to get his money, did I not?


Douglas Charles Abbott: I did not interrupt my hon. friend and I should like to state the other side of the case, because there are always two sides to a case. It is true that it was a new business and it is true that it was owned 50 per cent by a veteran. I do not know whether bowling balls are all made in the United States, but this firm can import all the bowling balls that can be made in the United Kingdom. Their quota is practically unlimited. They are restricted, it is true, as regards importations from the United States, but they are not restricted in bringing in equipment from the United Kingdom.


Arthur Leroy Smith: Is the minister not confusing these bowling balls with bowling balls which are used on the green? I doubt very much whether bowling balls used in alleys are even made in the United Kingdom.


Douglas Charles Abbott: That may be; I do not know.


Arthur Leroy Smith: That is quite a different matter.

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Douglas Charles Abbott: I do not know whether bowling balls used in bowling alleys are made in the United Kingdom. From the United Kingdom there is a substantial import of balls under the heading of sporting equipment, but whether they are bowling balls or not I do not know. My hon. friend has made a tremendous point, and this is one of the eases to which I referred in my first statement with regard to this policy, namely, that inevitably some hardship must be caused to somebody. You cannot put in a policy of this kind in a painless fashion; somebody has to be hurt to a certain extent.
This is a concern which is owned, it is true, to the extent of 50 per cent by a veteran and 50 per cent by a non-veteran, and it was not in this business before June. It was bad luck, if I may say so, to get into the business after June 30, but no one knows better than my hon. friend, who is a distinguished lawyer, that hard cases make bad law, and I am not going to take as a typical example the ease of one firm which cannot import bowling balls from the United States, which are prohibited and, I believe, under existing conditions properly prohibited. I cannot take this as an outstanding example of the foolishness and unsoundness of this prohibitory legislation. If the concern were owned 100 per cent by the veteran, there would be a special quota assigned to him; but it is not possible for me or for the administration to look into every case where there is joint ownership between a veteran and a non-veteran to find out whether it is a case where the non-veteran along with the veteran should get a special privilege.
I am told that this case, partly no doubt as a result of representations made by the hon. member for Calgary West, was carefully and sympathetically considered by the officials of the department, and the decision which was taken was one which it was felt was necessary if we were to maintain any semblance of principle in the administration of an admittedly difficult law.
The refrigeration matter raised by my hon. friend is, of course, a matter of the tax, which is under the amendments to the Special War Revenue Act and will come up later.
As regards the Calgary stampede, the stampede has certainly taken its place as the greatest show on earth and I agree that it is a great producer of United States dollars.
The reason fireworks were dropped from the prohibited list is that a considerable proportion of these do come from the sterling area countries, and that is one case where it was found possible to drop goods from the prohibited list.


Arthur Leroy Smith: May I ask a supplementary question?


William Ross Macdonald: If the bowling alley case has been completed, I should like to make a few observations.


Arthur Leroy Smith: May I ask one general question, Mr. Chairman?


William Ross Macdonald: Yes.


Arthur Leroy Smith: Is it the rule of the department that, when one seeks special consideration, the business must be wholly owned, 100 per cent, by a veteran?


Douglas Charles Abbott: That is the case unless it is an incorporated company where, of necessity, there must be legal qualifying shares held by two other directors, or whatever they may be. It is a special exception; it is a special privilege given to the veteran as a veteran.


Arthur Leroy Smith: I realize that. I am happy about it and am very much in favour of it. But let us take as an example, for instance, a young veteran like the hon. member for Davenport (Mr. MacNicol) here. We will say that he has now .returned from his fifth war or something like that.


Douglas Charles Abbott: It cannot be that bad.


Arthur Leroy Smith: And we
will say that he, being a poor man, has got together $10,000 and is going to form a radiator company or something like that. I have heard that he has been in the radiator business, not the radio business. We will suppose that he, having raised that money, gets hold of a plant and borrows $5,000 from a person who is not a veteran and who has a security on his business. Is that company or partnership which it may be, an enterprise wholly owned by a veteran, or is it not? If it is regarded as one that is wholly owned by a veteran, how in the world do you distinguish between two partners, one a veteran and one not a veteran; because in the case which I have mentioned if the thing does not go, the mortgagee, not the veteran, will ultimately own the whole business? A mortgage in that case is really ownership. What is your ruling there?


Douglas Charles Abbott: My hon. friend says that
a mortgage is really ownership. Some test must be established, and the test is whether the business is owned by the veteran. That does not preclude a veteran who owns a business from borrowing money from his bank, from a private individual or from anywhere else he likes.


Arthur Leroy Smith: With
security on the property?
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Douglas Charles Abbott: With security on the
property. I do not know what the effect is in my hon. friend's jurisdiction, but in the jurisdiction where I practise law the mortgagee takes a charge on the property but the veteran continues to own it. That is the test which is accepted for extending this special privilege. One must have some test. There will be borderline cases, I suppose, with regard to any rule. But I am informed that the rule which is followed by the division is that the business must be wholly owned by the veteran. He can borrow money anywhere he likes, but it must be his business. If he shares it with somebody else, he or the [DOT]firm is not entitled to this special privilege which no one gets but the veteran.


Arthur Leroy Smith: Let us take another example. Let us assume that we have a business for which you and I have paid $10,000. You would supply 89,999 and I would supply the dollar and so we would get the capital.


Douglas Charles Abbott: You would supply the
brains; I would supply the cash.


Arthur Leroy Smith: We would
get our capital together. I know this is not true, but we will say that you did not have that $9,999 and that I did not have the other dollar. What we do is we incorporate a company and we go to the minister sitting immediately behind you, who has saved all his money, as we Irishmen always do. What he does is this:	he says, "Now, boys, you
have a very nice company. You have a share apiece. Assign to me 998 of them in blank and I will give you the money you require." You are a veteran; I am not. As I told the House of Commons before, my only military achievement was that of being lance-corporal in the boys' brigade in the Methodist church in Regina. In a case like that-and that is an ordinary business case- would you say that you and I as veterans- you a veteran of the first great war and I a veteran of the boys' brigade in the Methodist church in Regina-would have special consideration given? I know it is half funny, but the thing might easily happen. What is your ruling on that?


Douglas Charles Abbott: Of course my hon. friend is a skilful lawyer and he would know many methods whereby perhaps it might be possible to achieve the desired end without the export-import control division being able to see through all the screens which were placed in the way of getting at the true ownership of the business.
[Mr. Smith (Calgary West).)


Arthur Leroy Smith: I have
borrowed money from every person and every bank that would give it to me. I admit that.


Douglas Charles Abbott: On occasion, I have done a little borrowing myself. It is hard to give rulings on these hypothetical cases. I think all I can do is to return to what I said a moment ago, that the test which is used in extending this special consideration to a special group is that the business must be the business of the veteran, and that veteran is entitled to a quota, although he did not have any record of performance in that particular line prior to June 30. No doubt there are cases where people may use veterans as a blind to cover up the real ownership which is not that of a genuine veteran, and softie of these we cannot catch. But on balance, the purpose Of the rule is to enable veterans to get this special treatment. I cannot say any more than that. The division are trying to administer the rule just as fairly as they can and in the interests, not of fellows who are trying to put it over on somebody else, but of genuine veterans.


Arthur Leroy Smith: You rely solely on legal title. May I again thank the department for their courtesy in turning me down in the gentle way in which they have.


William Ross Macdonald: Before we proceed to
clause 2, may I again refer the committee to the rules of the house. I draw their attention to standing order 58 (2), which reads as follows:
Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
The discussion we have just been listening to is one which I believe could have been more appropriately considered under section 3 (1) which reads:
No person shall import or attempt to import into Canada any goods listed or of the classes described in schedules I, II, or III . . .
And so on. I do not like to interrupt hon. members when they get into the midst of a discussion, but it occurs to me that the committee will make more progress if we abide by the rules of the house and make our remarks directly relevant to the clause which is being considered.


James MacKerras Macdonnell: I make one point which was made in the discussion before we rose at six o'clock, namely, that it was agreed-and I think the minister will bear me out in this-that it was desirable, before we did1 anything else with regard to this bill, to have a clear understand-

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ing of the changes which had been made in the schedules. I think this discussion so far, in a general way, has had to do with the schedules and their present condition.


William Ross Macdonald: I think the minister has handed to Hansard a table of the changes.


Douglas Charles Abbott: That is right.


William Ross Macdonald: I certainly think it would be out of order to discuss the schedules at this time. I am satisfied-and I think the committee will agree with me-that we always make more progress and get into fewer difficulties if we abide by the rules of the house.


Mr. HARKNESS:: While we are still on this billard supply case, I think it would save time if I now made one or two comments which I should like to make on it. On this same case I have also had a number of courteous letters from the minister, which did not do anybody any good. However, in stating the position a few moments ago I think the minister omitted one point; that is, that these billiard balls and other supplies which this small Alberta concern wishes to import, and which it started to import from the United States, are not banned. They are under a quota; and the Brunswick-Balke-Collender Company is still bringing in these materials. As a matter of fact, the only way in which this company can get any business is practically to become an agent for the Brunswick-Balke-Collender Company and take the stuff they bring in, at much higher prices than they could bring it in for themselves; otherwise they cannot stay in business at all.
When the minister introduced this measure he said special provision would be made for new businesses, and particularly for businesses run by veterans. As far as I can make out, no provision has been made for new businesses, as far as this company is concerned. The department has applied to it only one criterion, that the business was not entirely owned by a veteran, but only fifty per cent of it was so owned. Therefore they gave it no consideration whatever. Through you, Mr. Chairman, I would ask that the minister give consideration to this company on the ground that it is a new business, in addition to the fact that actually fifty per cent of it is owned by a veteran, and it employs a large number of veterans. It is no good talking, as the minister did a while ago, about making special exceptions for prohibited goods because these goods are not prohibited. It is merely a matter of whether Brunswick-Balke-Collender bring them in or whether a small Canadian company which is trying to get started, which
is chiefly manned by veterans and half owned by a veteran, is to have a chance to compete with that large concern.


Thomas John Bentley: I have a similar case I wish to mention.


William Ross Macdonald: If the hon. member wants to bring up another case I would ask that he reserve his remarks until we reach section 3. As I said, I did not want to interrupt the billiard ball case, but I do not think we should bring up a number of these cases at this time.


Thomas John Bentley: I shall have to do what the Chairman instructs me to do, of course,, but the hon. member for Calgary East had a lot of fun in his own way, and I think he brought up a good case. The other hon. member for Calgary was also allowed to go ahead and discuss it. If you insist that I am not to be given the same consideration of course I shall sit down.


William Ross Macdonald: I am not saying the hon. member cannot go ahead, but I am satisfied that we shall make more progress if the case he has in mind is discussed under section 3, which we shall reach very shortly.


Thomas John Bentley: I really do not believe it will be any more relevant under section 3 than it would be here; but, as I say, I shall be guided by your ruling.


Some hon. MEMBERS:: Go on.


Thomas John Bentley: In this connection I
wanted to recommend something to the government in regard to this veteran these other hon. members have been talking about; and I think they have a good case. In this country we are supposed to have what is called an industrial development bank. Why not have this bank lend the veteran the balance of the money and let him pay off the non-veteran half owner?


Douglas Charles Abbott: The non-veteran owner
could lend the money himself. If he would be willing to lend the veteran the money instead of taking a half interest in the business it would be all right.


Arthur Leroy Smith: Blood is thicker than water; he is a brother-in-law.


Douglas Charles Abbott: That should make him still more willing to lend the money.


Thomas John Bentley: Then the other case-


William Ross Macdonald: It is the other case to which I was referring.


Thomas John Bentley: Then I shall bring it up under section 3.
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Agar Rodney Adamson: This is a matter concerning a veteran, and since it is a general case I think it should be discussed on section 1.


William Ross Macdonald: Order. There should not be a general discussion of a specific case on section 1. This matter should be discussed under section 3, and I suggest to the hon. member for York West that he also reserve his remarks until that time.


Agar Rodney Adamson: This is not a particular case. It deals with the general principle of the bill, and it is along the same line, in regard to the veterans preference, which I do not see comes under section 3(a). The case is that of three veterans who started in the trucking business; the Minister of National Revenue knows about the case also.


William Ross Macdonald: Order. I think the committee must determine now whether or not it will abide by the rules of the house. I am in the hands of the committee, but according to my interpretation of the rules the discussion upon which the hon. member is now entering would be out of order at the moment, but would be in order under section 3, certainly, and possibly under section 2. It would certainly not be in order under section 1.


Howard Charles Green: With all deference, Mr. Chairman, may I point out that you have not yet heard what the hon. member for York West has to state. He has not gone along far enough to make his case, and I suggest that the discussion which has taken place has really been upon the general administration of the plan. Surely hon. members are in order in asking questions of that type. I have never known the Chairman to prevent discussion of that kind on the first section of a bill.


Douglas Charles Abbott: If I may add a word, perhaps it is always a little hard to draw the line between what can and what cannot be discussed under section 1. Perhaps matters relating to the general administration of the bill can be brought up under that section, though I believe that is open to question; but I think specific cases referring to the enforcement of prohibitions, when that is felt to be unfair, or the refusal to give quotas, or the giving of inadequate quotas, should be dealt with under the proper sections; in the case of prohibitions, when we are discussing schedule I, and in the case of quotas, when we are discussing schedule II, which is the quota schedule. Section 3 is the broad, enabling section which provides that no goods will be imported into Canada that are set forth in schedules I, II and III, except under permit; and I should think the door would be pretty

wide open under that section for almost any question of a general nature that might be raised. But is it pretty hard to deal with specific cases under section I.


Agar Rodney Adamson: This is a general case that I want to bring up under section I, and it is along the line of the case previously discussed, in regard to veterans. Here is a case where I think clarification is needed, and I believe this is the section under which it could be given. We were discussing the case of a veteran who owned only fifty per cent of the business. Apparently under the bill he is debarred. Here is the case of three brothers who have invested or borrowed from the government-


William Ross Macdonald: Order. In fairness to the hon. member for Swift Current, I do not think I should allow the hon. member for York West to bring up a specific case. To me it is obvious that it does not come under section I of this bill. Definitely it comes under section 3. If the committee wishes to disregard the rules of the house that is agreeable to me, but unless the committee so indicates it is my duty to enforce the rules.


Douglas Charles Abbott: If I may add just one word, if. the committee will look at section 4 it will be seen that this section deals with exceptional hardship, and the minster is given discretion to allow goods in where there are circumstances which, in his opinion, constitute exceptional hardship. Under that section I should think it would be quite in order to bring up cases which hon. members may feel are unfair; but to do so under section 1, which is the title section, I think is completely out of order.


Agar Rodney Adamson: I was not complaining that this case was unfair; I merely wanted to get clarification on a general matter. Here is an instance where we have a veteran owning fifty per cent. Then there is the other question where three veterans are partners, and one is not. Are they debarred under this section?


Douglas Charles Abbott: When we come to section 3 I shall try to answer that.


Gordon Knapman Fraser: How much has the country saved1 in United States dollars under this emergency plan of allowing only $150 for travel in the United States?


Douglas Charles Abbott: It is impossible to say; any answer given could be only an estimate. Expenditures of Canadians travelling in the United States can be estimated, but only with a reasonable degree of accuracy. The amount which will be saved by restricting those who travel in dollar areas for pleasure purposes

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to the amount of $150 once a year can be estimated only in a rough fashion. I believe the best estimate has been that the imposition of that restriction would result in a saving of something in the order of $30,000,000 or $40,000,000 a year.


Gordon Knapman Fraser: Has it cut down travel to the United States very much?


Douglas Charles Abbott: That is difficult to say. The period of extensive travel is the summertime. Of course it is still open to Canadians to go freely to the United States and take not more than $10 in United States currency and $15 in Canadian currency, as often as they like.


Gordon Knapman Fraser: As often as they wish?


Douglas Charles Abbott: Yes, that'is correct.


Gordon Knapman Fraser: W'hat are the regulations in respect of a man or woman under a doctor's care, who is supposed to go south for health purposes?


Douglas Charles Abbott: I believe I covered that in my statement. Such persons are allowed whatever is reasonably necessary to enable them to spend the time they are required to spend in the southern United States, or where-ever it may be, for medical reasons. The policy being followed' there is the same as that followed at the end of the war and immediately thereafter. From what I have been told, I believe the board is pretty reasonable about that sort of thing. There is very little questioning in respect of elderly people who are advised by their medical doctors that they need to spend a month or two in a southern climate. There is very little difficulty about that.


Gordon Knapman Fraser: Are applications in respect of persons who are ill made in about the same numbers as in other years?


Douglas Charles Abbott: I have not the figures here. However, I could get them, and give them later on.


Mr. JACKMAN:: I have one or two questions about the general administration of the bill. It is interesting to learn that, so far, the department has found it necessary to make only fifteen changes in schedule I, seven in schedule II, and only one change in schedule III. It might be of interest to the committee to know how many applications for changes have been made, how many of such applications have resulted in refusals and how many are still pending. If the minister would give us information on that point we might form some idea, despite the minister's statement that they were put on after very careful con-5849-70
sideration extending over some months-my own feeling is that they were slapped on in a hurry-as to just howr much disruption these regulations have caused in Canadian business.


Douglas Charles Abbott: It is difficult to give my hon. friend any accurate figures on that. I
suppose every interested party has made representations in the matter. There is a fairly long list of prohibitions, and I believe it is fair to say that pretty nearly everyone affected by the prohibiting list has made representations at one time or another. Other than that, however, I do not think I can give my hon. friend any detailed statistics.


Harry Rutherford Jackman: The minister did say that he had probably five or six delegations waiting upon him daily.


Douglas Charles Abbott: Not daily, no.


Harry Rutherford Jackman: Weekly.


Douglas Charles Abbott: To be fair, I would say they would average a couple a day, or about ten a week.


Harry Rutherford Jackman: I think the minister did say that the departmental officials had interviewed hundreds. I thought an estimate from the minister would be welcomed, so that we could learn howT much of a monkey-wrench these regulations have thrown into the Canadian business structure.


Douglas Charles Abbott: We have had all kinds of representations. Perhaps it would not surprise the committee to know that a good many Canadians have come forward and asked that additional items be banned, or placed on the prohibited list. We realize, of course, that it has a highly protective effect; and quite a number of Canadian industrialists, or at least, Canadian producers, have suggested that many United States dollars could be saved if we would add some items to the list, and thereby stimulate production in Canada. However, thus far we have not seen fit to accede to those requests. But there har e been a lot of representations to that effect.


Edmund Davie Fulton: As a matter of general policy, has the government any estimates which the minister would be willing to put before the committee as to the period of time which it is expected will elapse before the countries of Europe can be placed sufficiently on their feet to pay us in United States dollars, so that we can begin to take off these restrictions? In other words, how long will this short-range policy remain? When may we expect to begin to put into effect a long-range policy of removing restrictions and expanding trade? Can the minister give us some general indication of his views on the matter?
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Douglas Charles Abbott: I should like to be able to do so; but I think my hon. friend will realize that that is absolutely impossible. I have never laid claim to having any gifts of second sight, or of possessing any outstanding qualities as a prophet. I would not attempt to do more than say what I have already said, that we consider these restrictions as essentially temporary restrictions. When the world will be in a position where we can be paid in cash for what we have to sell depends upon so many factors which are completely beyond the control of this country, that I am not prepared even to hazard a guess.


Edmund Davie Fulton: Perhaps I should not have used the expression, "make an estimate." But we are given to understand that the program was an expedient. We were told that the government had a definite policy for expanding Canadian, trade along the lines of the Geneva trade agreements, and that this measure became necessary to conserve United States dollars. Just the other day the minister made a speech in Montreal in which he said how many Canadian dollars had been saved.


Douglas Charles Abbott: I told the house before. I gave no new information in Montreal that I had not given here.


Edmund Davie Fulton: The minister told how many Canadian dollars had been saved. Can he say when we can take off these restrictions? The government must be working, having in mind some sort of estimate as to the effect of the Marshall plan, and how soon the Marshall plan will enable Europe to pay in dollars for what she gets from us. I am asking the minister if anyone has been able to formulate a reasonable estimate as to how such European recovery will progress, and a time limit as to when we may be able to begin taking off these restrictions; or is the matter entirely in the hands of Providence?


Douglas Charles Abbott: In the first place, the figures I have given do not necessarily indicate how much we have saved. It is some indication of what our reserve position was at that time. I think it is a fair inference to say that the improvement was due, in part at any rate, to the actions which had been taken.
As to giving an estimate as to what the results may be in the future, my opinion is, and this is confirmed by the best advice I can get, that it is far too soon to attempt to hazard a guess. I uttered a note of caution the other day when I gave figures in the house which showed what these reserves were. I cautioned the house and the country that one swallow does not make a summer, that there is a long road ahead. After all,

a great part of the world is in a very difficult trading position at the present time. No matter how we in this country may try, and successfully try, to expand our exports to dollar markets, we cannot expect to be wholly prosperous, as I said in Montreal yesterday, in a prosperous dollar area with a depressed soft currency area. The net result must be that, as regards countries of western Europe and Asia, to which we have made such a substantial contribution in proportion to our means to get them back on their feet, the ultimate solution of our problem and that of others will have to be that those efforts must be successful. I am not going to attempt to hazard a prophecy or guess as to how we might have to continue some kind of appropriate action to conserve our exchange reserve position.


James MacKerras Macdonnell: You do not -think it will be just a matter of months?


Mr. MERRITT:: I appreciate the minister's frankness when he says that he has no idea how long these restrictions will have to be continued. I do not suppose it is possible to make a specific estimate as to the time when the restrictions can be removed. However, that only serves to show more clearly the difficult position into which the government has got this country. It shows how, by the provisions of this bill, the country is placing itself indefinitely in the hands of one or two men.
I see the heir apparent, the Secretary of State for External Affairs, laughing when I suggest that it is the government's policies which have brought this policy to its present condition but during this debate we have had from more than one source substantial reasons why this is so, chief of which is the action of the government in returning the dollar to par.


Douglas Charles Abbott: That would have fixed
everything.


Charles Cecil Ingersoll Merritt: There has been very
close control exercised by the government over all affairs of the country all the time since the war. Does the Minister of Finance know when he will be able to remove these restrictions? There are many manufacturers and agriculturists who would find it very useful if they had some forecast or knew that there was some "time certain" within which they could arrange their affairs and decide either to go into or out of business as a result of this new situation.


Douglas Charles Abbott: A lot of people would like to know when the stock market is going up.

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Charles Cecil Ingersoll Merritt: I was interested a moment ago when the minister pointed out that quite a few Canadians had come forward to ask to have goods placed on the prohibited list. I think he was trying to suggest to the committee that there was something wrong with that, that such a measure of protection should not be granted to Canadian manufacturers or producers. I want to remind him that in this legislation he has taken very good care indeed to look after the business interests of United States firms. The non-discriminatory provisions of this legislation are based upon the idea that, no matter what Canada's situation may be, no damage must be done to United States commercial interests. I see no reason why Canadian commercial interests should not receive as much advantage as possible in our present difficulties.
I am not suggesting that he accede to all requests for embargoes which amount to prohibitive tariffs. But I can see that in the case of goods produced in the proper quantities United States exchange would be saved and Canadian producers would be benefited. It is quite probable that more employment would be created. I suggest that if the minister could tell our manufacturers and agriculturists that there was a time certain within which the restrictions would not be taken off it would enable them to carry on business with profit to themselves and to the people of Canada in producing the things which we need. It would perhaps assist in keeping down the cost of living.
It would not matter if the minister does not know exactly the time when the restrictions would be removed. In the case of agricultural production he could guarantee the growing season. Then these producers would be able to plant a certain crop and be sure that they would not be faced with dumping just when it was to be harvested. In the case of manufactured goods it might be that many industries could go into the production of goods which are now being imported if they had a time certain within which these measures would apply. The Canadian people would benefit from the goods produced. It would not matter if, in fulfilling that undertaking, the restrictions with respect to the particular commodities had to be maintained a little longer than other restrictions. I think that is a matter which the minister should look into most carefully. There is no reason at all why the interests of the Canadian people and the Canadian producers should not come first in his mind.
We have had1 examples of people wanting to grow vegetables undier glass and things like that. When I was home in Vancouver 5849-70^
at Christmas time I had an inquiry from a business firm which for many years had had business connections with manufacturers in the United States. This firm asked me if I knew how long these restrictions would continue. I said I had no idea and I asked' why they asked that question. I was told that they were considering what they would do in the future. They said that if the restrictions were to be maintained for years they would' have to look into the question of whether they should change their agency to principals who could supply goods within the government's regulations, whether they should' go into manufacturing for themselves or what they should do. They pointed out, of course, that if these restrictions were to be of a short-term duration they would not like to upset their long-term arrangements. The minister must know that these considerations are important, and they concern many businessmen across Canada.. The fact that he cannot tell us for certain the date on which the restrictions will have to come off, and when the Marshall plan will come inito effect, does not. relieve him of any responsibility to give a lead to Canadian 'business and agriculture on this vital point of the restriction program. I urge him to relieve the people of Canada from uncertainty, even though he cannot relieve himself of uncertainty in this respect.


Mr. POULIOT:: Mr. Chairman, the suggestion of my honoured colleague the member for Vaneouver-Burrard is certainly worthy of consideration. I listened to him with great interest, but he should make some more precise suggestions to the minister and tell him what, in his view, i9 the time that should be taken to continue these controls in the interests of the farmers and' the producers. 1 understand very well that it is embarrassing for the producers when there is a change in tariff. We complained' of that a long time ago, and conditions are similar. A tariff must have a certain amount of stability, and' in that there is a lot in what he said'. He has spoken in a persuasive manner, and I am sure that, he got the ear of the minister.
First, he complained that the cabinet ministers who are sitting on the treasury benches were smiling while he was speaking. There are two obvious reasons for this. In the first place, evidently they were enjoying his speech and, in the second place, they are naturally cheerful. It is a very good thing for cabinet ministers to remain cheerful in such circumstances as these, and it is to their credit.
The hon. member for Vaneouver-Burrard has not always a smiling disposition. He sees
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everything in dark colour. As a member of His Majesty's loyal opposition it is naturally his duty not to see everything in rose and pink. I understand that. I do not agree with him but I understand it. However, he should not blame the ministers for their naturally good dispositions, especially when they listened so attentively to him. By smiling when he is speaking, it shows that they appreciate his grains of wisdom.


Howard Charles Green: They are smiling at you now.


Jean-François Pouliot: No; it is the smile that they had when the hon. member for Vancouver-Burrard spoke, which is still continuing. They enjoyed the speech so much that they still enjoy it, although he has ceased to speak and although I am speaking myself; it is a credit to him, and I congratulate him for having achieved such success.


Charles Cecil Ingersoll Merritt: May I ask one further question? The smile of the nature to which the hon. member refers I would reciprocate, but the smile I referred to was not one of those smiles, I am afraid. The question I want to ask is this. How far does this bill or the present order in council bind government agencies? For instance, the Commodity Prices Stabilization Corporation is an agency of the crown. Is that agency bound by the prohibitions, quotas and restrictions of this bill?


Douglas Charles Abbott: The bill binds all corporations. Of course it does not bind the crown.


Charles Cecil Ingersoll Merritt: Perhaps the minister can give me a non-technical answer. Will the Commodity Prices Stabilization Corporation be given a quota for quota goods, and will it be unable to import prohibited goods?


Douglas Charles Abbott: It is bound by the bill, yes.


Charles Cecil Ingersoll Merritt: I understand that either in December, or at some time when these restrictions became current, the corporation, either directly or through agents, purchased 200 cars of shelled peanuts in the southern states, and I have information that shelled peanuts were available in Fiji and in India, and in other sterling area countries. I was also informed when I was in Vancouver, although this is on a much more minor section-


Douglas Charles Abbott: Did my hon. friend say they were shelled peanuts?


Charles Cecil Ingersoll Merritt: Shelled.


Douglas Charles Abbott: These are not either banned or under quota. They are free; anybody can bring them in.


Charles Cecil Ingersoll Merritt: Yes.


Douglas Charles Abbott: Nuts in the shell are under quota or banned, but not shelled peanuts.


Charles Cecil Ingersoll Merritt: These nuts were bought from the United States, of course. I understand that United States dollars were paid for them by a government agency. I am suggesting, and my information is, that similar nuts were available for sale in sterling area countries.


Douglas Charles Abbott: They are in very short supply, and are part of our international allocation in the oils and fats administration. Peanut oil is made from them.


Charles Cecil Ingersoll Merritt: If the minister will let me finish what I want to say I should then like to hear what he has to say in reply. In a much more minor key I was advised recently that a government building in the city of Vancouver has to buy a well-known United States type of floor wax. My informant claimed that there was a very good Canadian substitute which could not be purchased because of the policy of the Department of Public Works or whatever department is concerned. I should like to ask the minister- and it makes no difference whether peanuts or floor wax do not come under this bill- whether the government in its own purchasing is observing the spirit of the austerity program in the same way as it is insisting that it be done by private individuals across the country? Does the government make sure that, before it purchases anything with United States dollars, it cannot get the article it wants from any Canadian or non-United States dollar source. Is there any policy on that point?


Douglas Charles Abbott: The government observes these restrictions the same as anyone else. I cannot give my hon. friend the categorical assurance that some government purchasing department may not purchase some floor wax which it might have got in Canada. If we knew about that we would not permit it. The general rule is, of course, that the government departments are observing the law and are subject, in fact, to the same rules exactly as anybody else. The government purchases its supplies through the ordinary channels of trade. It is not, as a rule, a direct importer of anything.


Charles Cecil Ingersoll Merritt: I should like to suggest to the minister-if no special instructions have been given to this effect as a result of the restriction program having come into force that the government now see to it that such instructions do go out and that govern-

______________Foreign Exchange Conservation
ment agencies conserve United States exchange just as private persons in the country are required to do.


Douglas Charles Abbott: They do. The government buys supplies through the ordinary channels of trade. It is not a direct importer. I should qualify my statement there. We do import certain military supplies from the United States; but so far as ordinary civilian supplies are concerned, they are purchased through the ordinary channels of trade in Canada, the same as anybody else purchases them.


Charles Cecil Ingersoll Merritt: They are purchased here. The Commodity Prices Stabilization Corporation and the Canadian Commercial Corporation must be subject to government policy in that respect. Surely, if they are not-


Douglas Charles Abbott: Of course they are.


Charles Cecil Ingersoll Merritt: Then, surely in these circumstances specific instructions should be given to these bodies to purchase in nondollar countries where they can.


Douglas Charles Abbott: Perhaps my hon. friend would be satisfied if I told him that the president of the Commodity Prices Stabilization Corporation is the chairman of the war-*ime prices and trade board, and is the assistant deputy minister of finance who is specifically charged with the administration of the emergency control division. So he can rest assured that the Commodity Prices Stabilization Corporation is observing the so-called austerity program.


Charles Cecil Ingersoll Merritt: I might observe, Mr. Chairman, that I would not be wholly satisfied with that since the minister is here himself and he could, if he would, give the assurance I asked for.


Mr. LENNARD:: With respect to what the hon. member for Vancouver-Burrard had to say in connection with growers, I have particular reference to those who grow under glass, the greenhouse men. In answer to a suggestion of the hon. member for Temis-couata that the minister should have some direction, I might say that a crop of tomatoes grown under glass takes four months, and if there is to be any change in the regulations and there is an increase in the growing of tomatoes for the spring crop, if these regulations are taken off by the end of May it will be a non-profit crop for those who would be sacrificing another crop to grow foodstuffs needed in this country.
Another point I wish to bring up, a general point, is that the florists of the country-I do not mean the flower shops, but those who grow flowers-are not buying bulbs for spring planting. They do not know what the regulations will be in May around Mother's day,, when formerly great imports came from Florida and the southern states. They do not know whether the restrictions will be in force then. They do not know what to do at the moment, and that is the situation as far as the growing trade in eastern Canada is concerned. I know something about the matter, and I can assure the committee that these people do not know where they stand. Someone has foolishly told them that these restrictions will be lifted about March 31. I am sure that is not the case, but they do not know that, and the whole thing is in a muddle.


Douglas Charles Abbott: I received a delegation from the vegetable growers, and they brought up the question whether they could get an assurance as to how long the restrictions would be in effect. They referred to the growing of tomatoes and lettuce under glass and to the expansion of hothouses. I told them-and I am sure they were not surprised-that I could not give any assurance that this measure was a protectionist measure and that anybody who expanded the production of hothouse tomatoes or lettuce must take whatever business risks were involved in doing so under our system. If they planted and the restrictions were still on, they would make a handsome profit and if they planted and the restrictions were not on, they would not. That is a part of the system, and I told them I could give no assurance as to when the restrictions would be taken off. They were not on as a protectionist measure but as an emergency measure, and that was a business risk which they w'ould really have to assess for themselves.


Edmund Davie Fulton: That is not a business risk. That has been the objection to so many of these things. Government interference with the ordinary cycle of marketing, whether necessary or not, creates hazards that cannot be called business risks. No one has asked that this be turned into a protective measure. But you have interfered with the Canadian economy and we say that you should now try to alleviate the effects of that interference as much as you can. Where you have created tremendous uncertainty, try to minimize that uncertainty by introducing a little certainty. If you tell them, "We will not take it off for six months or even three months", you will give them that degree of certainty. That is not a protective measure. It is a measure of common sense, and to refuse to do it is to blind your eyes to the disastrous effects that these things are having, effects which they need not have at all.
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Douglas Charles Abbott: No one need go ahead and build more hothouses to grow more tomatoes and lettuce.


An hon. MEMBER:: Why not?


Douglas Charles Abbott: If they want to do so they do it at their own risk. We are not putting on prohibitions to encourage the production in this country of hothouse tomatoes and lettuce in the winter. Why should we? If conditions were normal it would be far better to buy lettuce and tomatoes where they are grown naturally in the open and to sell something else to the United States. This measure is not put on as a protective measure to enable industry to expand or increase behind what *is the greatest form of protection, namely a prohibition. It is not for that purpose. It is a *temporary measure because we have to do it. It is put on reluctantly, and anyone who expands production in a particular field, relying on the protection which is afforded by these prohibitions, must do so at his own risk.


William Henry Golding: What is before the committee now is simply the short title, "This act may be cited as the Emergency Exchange Conservation Act". The rule is very clear. Standing order 58 states that speeches in committee of the whole house must be strictly relevant to the item or clause under consideration. I wish to appeal to hon. members to try to conduct the business of the house in an orderly way. There is no reason in the world why we should discuss all these matters on the short title. When we come to the different clauses these matters can be discussed in their order. I think hon. members ought to agree now to follow the rules of the house. I appeal to them to pass this clause and get on with the clauses that deal with any of the matters which have been brought up under clause 1.


Frank Exton Lennard: There is one point I want to call to the attention of the Minister of Finance. I did not for a moment intimate that the acreage under glass should be increased by one foot. I wish that distinctly understood. But the growers want to know what to grow that will be most beneficial to the people of Canada. Would it not be better to grow vegetables than flowers, something necessary for the people.


Douglas Charles Abbott: I should like to be able to help the growers. My hon. friend has asked a direct question. I do not know that it is very much better for the people of Canada to have hothouse lettuce grown in Canada than hothouse flowers. It is fifty-fifty. Obviously

there are not enough hothouses in Canada to provide everyone who wants lettuce with that vegetable. Lettuce grown in winter is a straight luxury commodity, and I consider that the people who want to buy hothouse lettuce in winter can pay the price if they have the money. If you were importing lettuce, if you had the United States dollars to import it in volume from the United States or anywhere else at reasonable prices, and if everyone could buy it, well and good. But when you cannot do that, then I say that lettuce grown under glass is a special luxury product which those who can afford it can pay for.


Howard Charles Green: On a point of order, Mr. Chairman, before you took the Chair we had a discussion with regard to what would or would not be in order on this section. The Deputy Speaker was then in the Chair, and it was pretty well agreed on all sides of the house-and certainly he did not question us on our submission-that any discussion of general adminstration of the plan would be in order on this first section.


An hon. MEMBER:: That was not agreed to.


Howard Charles Green: We were not ruled out of
order. The Postmaster General has been sitting here all evening and he did not make one peep about its being out of order.


Douglas Charles Abbott: The Deputy Speaker was
doing his best.


Howard Charles Green: The questions asked in the
last half hour have been all of a general nature having to do with the general administration of the plan, and I submit to Your Honour that as long as they are of that type they are in order. I agree that if we were dealing with questions which could be brought up under specific sections, the questions w'ould not be in order, but that is not the case.


William Henry Golding: In answer
to my hon. friend I would say-and I think he will agree with me-that many of the questions which were raised would be more properly raised when the various clauses are before the committee. I would point out that before six o'clock I made an attempt to get the members of the committee to deal with this bill in an orderly manner; that is, to deal with clause 1, which is only the short title, and then go on with the other clauses and deal with the different matters which have been discussed here. But we have not reached the other clauses at all. Surely my hon. friend does not contend that this is an orderly and proper way in which to deal with

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the bill. On the contrary, it is altogether out of order. There is no rule that permits it. I want to appeal again to hon. members to try to deal with the business in the way in which the rules provide (hat it should be dealt with. It is not a pleasant thing for the Chairman to be obliged continually to call hon. members' attention to the rules. Every hon. member should try to assist the chair in seeing that the rules which are laid down for us are complied with. I think we should abide by them. I appeal again to hon. members to try to get on in an orderly way and deal with clause 1.


Jean-François Pouliot: Mr. Chairman-


Mr. ROSS (St. Paul's):: I should like to
ask the minister a question.
This comes under the general heading. I do not think it will be out of order. This bill deals with the question of saving exchange.


William Henry Golding: Order.


Douglas Gooderham Ross: I do not intend to deal with what is in the bill. I want to ask a question.


William Henry Golding: Order. The clause that is before the committee now is the short title; that is all. I think my hon. friend will find other clauses-


Douglas Gooderham Ross: Emergency
exchange.


William Henry Golding: as we go along, under which he can deal with the problem he has in mind.


Douglas Gooderham Ross: I have not stated it yet.


Jean-François Pouliot: I abide by your ruling. Mr. Chairman.


Douglas Gooderham Ross: Mr. Chairman-


Jean-François Pouliot: I wfill not discuss your ruling, Mr. Chairman; I abide by it.


Douglas Gooderham Ross: -I have the floor.


Mr. HARTT:: Who said so?


Jean-François Pouliot: I am sorry, sir, but I think I have. We are dealing with the short title, which reads as follows:
This act may be cited as the Emergency Exchange Conservation Act.


Douglas Gooderham Ross: That is what I said.


Jean-François Pouliot: This is the first time that I can repeat what has been said by St. Paul's without making a mistake. I would suggest to the minister that he change the short title so that it reads in this way:	"This act may
be cited as the barter act." Barter should be
a detour around United States dollars. The trouble now is that everybody is inclined to adopt new fashions. Why should we always stand by the United States dollar, speak only of the United States dollar from dawn to dusk and from dusk to dawn, and think only of the United States dollar as a means of exchange?
In the first place, the purpose of exchange is to correct the difference in a transaction which is made between two parties. Usually goods are exchanged and the difference is paid in dollars. But when we hear of the dollar as being the principal in a transaction instead of the accessory, one falls into the error of the Social Credit group. My suggestion to the minister is to trade by means of barter, to barter with all the countries that have not enough United States dollars with which to pay for Canadian goods. Only last year I made a practical suggestion to the minister regarding the income tax, namely, to replace the income tax by another kind of taxation that would not be so hard on the Canadian taxpayer. This time I suggest to him that he put aside the United States dollar and practice barter, and that he assist Canadian exporters and importers to barter with all countries of the world which have not enough United States dollars with which to make full payment for Canadian exports. That would be a way to recovery, and it would show the people of the United States that we may become independent of them.
Why should we always be subservient with regard to the people of the United States? There is no reason for it. South of the United States is a republic which is entirely independent of the United States. There are some United States investments there as there are some here; but they do their business with the United States andi they can do so well that one official of the government-not a responsible gentleman, but one of the deputies -said not long ago that our trade with Mexico could amount to $100 million a year. Is it possible for Mexico to pay us in United States dollars? I doubt it. But we could practise the exchange of goods. Therefore there should be an entirely different trade policy. We should have a trade policy that would mean something to the Canadian people. In this country we have primary products and manufactured goods that we could exchange for primary products and manufactured goods of any other country in the world. At the present time what is the plague of the United Kingdom? It is that they have not enough United States dollars. But those people from Cripps down to the last cabinet minister are devoid of imagination. When they start with the wron?

Foreign Exchange Conservation
fashion, they think they are bound to continue to follow that fashion. They are entirely devoid of imagination, which should be the first quality of those who frame trade policy or any other policy of importance to the country. This is just an idea that is put forward, and1 I may tell the minister that I am not the first one to suggest it.
A long time ago, when Mr. Stevens was Minister of Trade and1 Commerce and when Brazil was throwing coffee into the ocean, I said it was a crime to throw away a commodity like that which had value. They had over-production. They were n-ot using the coffee at all; they were throwing it into the Atlantic ocean. We could have exchanged wheat for coffee. I made that suggestion to Mr. Stevens, who was minister of trade and commerce, and he said1 it was worthy of consideration. That is just what I saidi a moment ago, of course entirely without authority, to the hon. member for Vancouver-Burrard. Many others have suggested it. Only this winter, around Christmas, on the first page of the Montreal Gazette I read that no less a man than Colonel Horace Boivin, mayor of Granby, who has visited every country in Europe in the interests of Canadian manufacturers, advanced exactly the same suggestion. Therefore it is not only the suggestion of the member for Temiscouata; it is the suggestion of many people.
Trade is not only a question of banking. Banking is secondary in trade. What is essential is the exchange of products. Here I pay special tribute to the producers of this country in every field; the farmers, all the producers of primary products, the fishermen, and the producers of manufactured goods. But they need the assistance of the government. They need the help of our trade agencies, call it commercial intelligence or what you like. They need the help of our consuls and our so-called ambassadors to promote Canadian trade. These gentlemen do very little for better political understanding among the nations. They should prove their usefulness in promoting Canadian trade, in helping out those who have something to sell and those who wish to buy. For a time it was impossible to learn anything, about imports; the figures were not given by the predecessor of the hon. gentleman who is piloting this bill. It was impossible to get any information about imports. Now we hear only about imports, and the figures in regard to exports are false. Our trade is fictitious. Let us come back to real trade. Let us barter our goods with the other nations of the world, and let us be free of the United States dollar.
[ilr. Pouliot.]


Angus MacInnis: I rise to a point of order. During the short time we were discussing this matter this afternoon various hon. members were ruled out of order for making speeches which were not nearly as far from the subject, from my point of view, as the one just made. I think hon. members should be uniformly kept within the same limits.


Jean-François Pouliot: My speech was absolutely relevant, because it was in reference to a suggestion I made to the minister about changing the short title. It was relevant from A to Z, and my hon. friend knows it.


Angus MacInnis: My hon. friend might have made the suggestion, but there was nothing in his speech that had anything to do with changing the title.


Jean-François Pouliot: It all referred to the suggestion I made about changing the title.


William Henry Golding: The point raised by the hon. member for Vancouver East is perfectly correct. I agree that the speech just made was not in order, just as many others this evening have not been in order. That is what I am appealing to hon. members to avoid, and again I would ask their co-operation.


Douglas Gooderham Ross: I shall try to do as you say, Mr. Chairman, and stay in order; I like you so well I would not want to go against your wishes. However, the only place I can find to say what I have to say, which will be brief, is in connection with emergency exchange. The idea of the bill is to save United States exchange, and my suggestion is this; I do not know whether the minister has already adopted it. I think he should make an appeal to the Canadian people telling them to buy Canadian, to buy British, to buy French. If he made it a real appeal I am sure he would save a good many United States dollars. I believe a great many things which are now being bought American would be bought Canadian if the right appeal -were made by this government.


Douglas Charles Abbott: Just in reply to that suggestion, may I tell my hon. friend that we published a couple of advertisements in the daily press throughout Canada, in order to reach as many people as possible, pointing out some ways in which we felt this emergency could be met. We said:
Do not order goods by mail from other countries ... do not buy goods to bring home when you travel outside Canada.
If you feel some purchase is absolutely essential, see your collector of customs and excise beforehand to learn whether the item is prohibited.
Look for alternatives or substitutes for the items which are temporarily prohibited.

Foreign Exchange Conservation
In the opening paragraph of the advertisement, which emphasized why this was necessary, we said:
Canada is heavily "in the red" in present trading with the U.S. dollar area. In our total trade with the world we are in a good position but not in that part which is done with the U.S. dollar countries. Other countries with whom we do business cannot pay us in full, either in cash or in goods, for the things they buy from us. . . .
There are two things we can do at the moment . . . cut down unnecessary purchases from the U.S. dollar area and increase our production of goods that can be sold to those countries to balance accounts.


Douglas Gooderham Ross: But you do not say why.


Donald Methuen Fleming: Why not say "Buy
Canadian"?


Douglas Charles Abbott: That is a slogan. It is a necessary inference from what I have read: "cut down your unnecessary purchases from the U.S. dollar area." What else can it mean?


Douglas Gooderham Ross: You could say "Buy Canadian" and "Buy British."


Douglas Charles Abbott: Well, I really give the Canadian people credit for enough sense to believe they will take that for granted.


Donald Methuen Fleming: Just before six o'clock the minister, in referring to the schedules and also, I think, to the provisions of P.C. 4678, said they represented months of work, by which I took it he meant that months of work had been applied to the formulation of those provisions before they were promulgated on November 17. Would he expand1 his remarks somewhat and indicate to the committee when this work was begun?


Douglas Charles Abbott: I do not know that I can give my hon. friend an absolutely accurate answer, but broadly speaking I should think it was about midsummer. About that time it was realized that it was quite possible import restrictions might have to be resorted to as a method of conserving our United States dollar reserves. It was realized by those who know something about these matters that it would not be possible to create overnight a workable and appropriate schedule for putting into force such import restrictions; and about the middle of the summer we set up an interdepartmental committee, of which the present assistant deputy minister of finance was chairman, to study the question of what import restrictions could or might properly be imposed should it be decided to take that step.


Donald Methuen Fleming: Then may I follow that up with two other questions? The first is,
were the tariff experts of the Department of National Revenue, on the customs side, consulted in that work?


Douglas Charles Abbott: They were on the committee.


Donald Methuen Fleming: Second, what was the total of gold and United States dollar holdings in Canada at the time that work was begun, which the minister says was midsummer?


Douglas Charles Abbott: I have not that figure available here, but I think I gave that information in reply to a question by the leader of the opposition at the very outset of the session. Those figures are on Hansard, or were tabled early in the session.


Agar Rodney Adamson: I want to move an amendment to clause 1, the short title. I do not think the word "emergency" is justified at the present time; I think the word should be "chronic". I do not see how we can get the word "chronic" into the title of the bill, but the situation nevertheless is chronic.
Two years ago we warned-I certainly warned-that our exchange situation was going from bad to worse. It was aggravated in 1946 by the parity action. Times without number I said in the house that the government would have to take restrictive measures and would have either to impose embargoes or to put on tariffs, restrict dollar exchange, restrict trading in dollars and eventually devalue.
They paid no attention. They found themselves eventually squeezed and squeezed and squeezed into a corner, like a rat, and having now to take these actions belatedly. As I said when I spoke on the bill, they will have to take action, and even more stringent action, before they get out of the impasse they were in.


Douglas Charles Abbott: Some people hope they will have to.


Agar Rodney Adamson: I believe we cannot foresee the day when we shall not have to have exchange conservation acts. And to call this an emergency, or to refer to it as an emergency-well, it is an emergency, but it is more chronic than emergent. To refer to it as an emergency, and to suggest that it will remain such, merely makes the operation of the act more unsettling than it normally will be. From that fact it upsets people who are growing vegetables and producing other embargoed goods. The very word "emergency" makes the operation of the act more hazardous, and adds greatly to the uncertainty of the situation.
We have a problem which will be with us for a long time. The very action that is taking place in the commodity markets and the stock markets of the world in the last week shows that what has happened has intensified our problem. The matter is of the utmost seriousness. It is, in very truth, an emergency; but to call it an emergency and to assume that it is of a temporary nature is, I think, unwise and unsound. The Canadian people should realize the true situation we are in. Therefore I have pleasure in moving this amendment.


Ernest Bertrand: Would the hon. member be good enough to tell us the last time he warned the house about what would happen? I should like to read it.


Agar Rodney Adamson: On the last day of the last session I said that you have to get down to devaluation, that it would start before you came back here. France devalued, and England will devalue-she cannot help it. I also said-


Ernest Bertrand: Would the hon. member-


Agar Rodney Adamson: You asked me a question; let me answer it. I spoke on the budget last year and, although I have not the copy of Hansard with me, I said on July 17 that there were throe courses of procedure open to the minister. He had to take them and he had better take them before he ran out of hard currency and gold. He could put embargoes on, raise tariffs right across the board, put on restrictions with regard to United States dollars and hard currency, and devalue the dollar. There are three weapons you can take to overcome the hard currency deficit. He has taken two and a half of them. I feel that the third one will be essential.
That was said last summer. And .speaking during the second session I said virtually the same thing, namely, that our monthly deficit

of hard currency was rising and that the nest-egg of SI,600 million would run out, I estimated some time this spring.
The true state of our position with regard to gold and United States currency was asked from the minister recently. He gave a general statement, but he did not bring out the difference between gold and hard currency, and United States dollars. We do not know how much British gold and gold from other sources was shipped in and earmarked. We have just the general overall figure of the gold and hard currency held.
I suggested a year and a half ago that we would run into the impasse we are in today. We are in it now and, Mr. Chairman, with all due respect to the government, we shall be in it for a long time to come. And if we are not prepared to face the facts, then the whole bill is just wishful thinking and a palliative, and we are in for a worse time than this government ever contemplated.


Douglas Charles Abbott: Just a word in answer to
the hon. member. I do not know how serious he is in suggesting his amendment. He admits that this is an emergency, but suggests that the use of the word "emergency" in the title suggests that it is for a short time. I do not know that I agree with him on that.
It is true that he has been an advocate of devaluation for some time, and there are a great many people in this country who would like to see the devaluation of the dollar. They would benefit by it.


Some hon. MEMBERS:: Oh, oh.


Douglas Charles Abbott: Yes, they would; I know they would; make no mistake about that. There are advocates of devaluation, because, among other things, it would benefit some lines of endeavour that they would be in.


Some hon. MEMBERS:: Oh, oh.


Douglas Charles Abbott: I seldom interrupt other
people. I am not questioning the fact that the hon. member for York West has advocated devaluation for a long time; but I do not agree with the assertion which is made here that devaluation is inevitable. I see very little useful purpose in putting it forward. And when he suggests or implies that the position of France is the same as that of Canada and that because France found it necessary to devalue Canada should, in my judgment he is talking nonsense. The situations are not comparable at all. France was not in a position to export because her prices were too high; the goods were too high. That is not so with Canada.

Foreign Exchange Conservation


Agar Rodney Adamson: If the minister can read anything in what I said where I even remotely suggested that our conditions were the same as those of France, then I suggest very seriously that he see an alienist. I was replying to a question put by the Postmaster General. He asked when I had advocated these three measures in the past. I suggest to the Minister of Finance that perhaps in a court of law he would be considered to prejudice his case when he says that I have advocated devaluation alone. I said that there were three weapons which the government could use. They have used two of them, or perhaps two and a half, but in my opinion they will have to use the third.
Whether the situation in France will have a chain reaction cannot be known, but I merely say that the thing that started to drive all currencies off the gold standard in 1931 or 1932 was the failure of a comparatively small bank in Austria, the Creditanstalt. That started the chain reaction, which led directly to the bank panic in the United States. I do not say that the devaluation of the French franc will start a chain reaction throughout the currencies of the world, but I do say that when you have currencies artificially pegged at a false parity very much higher than the price at which they are bought and sold in the open market, then you are in an extremely dangerous and unsound economic position and one out of which this country is not likely to get for a considerable period of time.
To throw out the rather nasty innuendo that devaluation would benefit some is, I think, unworthy of the minister. It is the sort of glib gibe we are too prone to expect from him lately. When he looks at the whole picture and gets a more oriented and mature view of the thing I think he will see that the forces which are at work in the world today are much greater than those which can be controlled by his government, by his advisers or by the people in Ottawa. The situation is worldwide. Unfortunately we are in it and cannot get out of it wdthout taking continuous measures to conserve our hard currency. The fact that you call it an emergency and regard it as temporary is simply deluding the Canadian people.


Mr. QUELCH:: When the hon. member for York West was speaking I could not help but think it was a pity that he had' not a better appreciation of the world situation at the time we were discussing the Bretton Woods agreements. At that time he supported them, but I notice from an article of his which appeared in the New Liberty magazine he is advocating that we withdraw from the
international monetary fund. It will be recalled that when we were discussing Bretton Woods we criticized the proposal to value our currency in terms of the United States dollar, having only the right to devalue it by ten per cent. We have since then seen nations of the world being forced to break away from the fund' because they could not devalue their currency by more than ten per cent.
As I understand it, the purpose of this measure is to conserve United States dollars. That being the case, I should like to ask the minister why the government has considered it necessary to place prohibitions against imports from the sterling area. I am well aware that under the Geneva trade agreement we have agreed to a policy of nondiscrimination, but I realize also that there is an escape clause which permits a nation with an unfavourable balance of trade to place prohibitions against imports from a nation with which it has an imbalance without placing similar restrictions or prohibitions against imports from nations with which it has a favourable balance of trade.
Surely that escape clause was meant to cover exactly the situation that we have today in Canada? We have an imbalance of trade with the United States, while we have a favourable balance of trade with the rest of the world. One of our main difficulties is to get sufficient goods for Canadians to consume without having to use United States dollars. Apparently Great Britain has certain goods which we need and which are available for export to this country. Surely the logical thing is to doi everything in our power to encourage imports from the United' Kingdom. I know the minister has said that the amount of business covered by this prohibition is small, nevertheless it is a certain amount of business. Why should we discourage importations from the United Kingdom when we have a favourable balance of trade with that country?


Douglas Charles Abbott: I have already said why, and I can say it again. Does the hon. gentleman suppose that there is any country in the world which has a greater interest in the principle of non-discrimination than Canada, both because of the volume of our external trade and 'because of the triangular pattern of that trade?


Victor Quelch: That is not satisfactory at all. In that agreement there is an escape clause to deal with the very situation which exists in Canada. We can take advantage of

Foreign Exchange Conservation
the escape clause without violating the principle of non-discrimination. Otherwise, why is the escape clause there?


Douglas Charles Abbott: We do not want to violate it, but we do want to set an example. As I have said two or three times, the amount of business is negligible, whereas the benefits to be got from this restrictive program are tremendous.
Progress reported.



BUSINESS OF THE HOUSE

James MacKerras Macdonnell: Is there anything further to be said about the business on Friday? As I understood the Prime Minister, he said that, first of all, we would go on with Bill No. 3, and then he said the minister might wish to do something different.


Douglas Charles Abbott: As the Prime Minister announced, we shall proceed tomorrow with the debate on the address. Due to an engagement which I made a long time ago it will not be possible for me to be in the house on Friday. I had proposed speaking to the leaders of the parties tomorrow to see what arrangements we might make for business on that day. I shall be available tomorrow and Thursday to proceed with this bill, but I would assume that hon. members would want to continue with the previous arrangement for the debate on the address on Wednesday and Thursday.


Stanley Howard Knowles: Why not switch Friday for Thursday?


Douglas Charles Abbott: That would be absolutely satisfactory so far as I am concerned. I would be glad to proceed with the discussion of this bill on Thursday if that met with the wishes of all parties; but perhaps we had better leave that until tomorrow and either I or the whips could discuss that question.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Wednesday, February 11, 1948