AUDITOR GENERAL AND ACTING MINISTER OF FINANCE

Hon. J. A. ROBB (Acting Minister of Finance):: Mr. Speaker, I desire to lay on the table certain correspondence exchanged between the Auditor General and the Acting Minister of Finance, asked for by my hon friend from West York (Sir Henry Drayton).



CORRESPONDENCE ON OCEAN SHIPPING RATES

Hon. T. A. LOW (Minister of Trade and Commerce):: Mr. Speaker, I desire to lay on the table of the House a copy of the correspondence asked for yesterday by the right hon. leader of the opposition (Mr. Meighen) in connection with ocean rates.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, last night my right hon. friend (Mr. Meighen) asked me with respect to a report on ocean rates from Dr. Magill to himself. I mentioned at the time that I had requested one of my colleagues to telegraph Dr. Magill for tihe report. This morning he received the following telegram in reply:

Hon. T. A. Low,
Minister of Trade and Commerce.
Winnipeg, March 10;
Hid not undertake work offered in Mr. Mcighen's letter February 16, 1921, because Hyndman Commission on grain trade appointed about that time.
R. Magill.
There appears to have been no report.
With reference to the correspondence which was tabled yesterday on the subject of ocean rates and the correspondence which has been tabled to-day from the Department of Trade and Commerce, which correspondence was requested by the right hon. leader of the opposition, I think the House should have the advantage of perusing it, and I therefore beg to move:
That one thousand copies in the English language and five hundred copies in the French language of the correspondence between the government of Canada and the British government in regard to the subject of ocean rates and especially in relation to the Imperial Shipping Committee laid on the table of the House on Monday, March 9, and one thousand copies in the English language and five hundred copies in the French language of the correspondence from the Department of Trade and Commerce regarding transatlantic freight and passenger rates, laid on the Table thiis day, be printed forthwith, and that rule 74 be suspended in relation thereto.


Right Hon. ARTHUR MEIGHEN (Leader of the Opposition):: Mr. Speaker, I certainly
have no objection to the correspondence tabled on the 9th, which I asked for, between the Prime Minister's office and the British government or the Imperial Shipping Committee, being printed. But I know nothing about this subsequent correspondence which has been laid on the table to-day; it was not included in what was asked for by me. I have no personal knowledge of it so far as I know. It is somewhat voluminous and I only had about three seconds to look at it, but I note that many of the letters addressed to the minister are marked "private and confidential" ; I have not noticed whether any of his are or not. It seems to me that probably we would not be acting rightly in having the correspondence published without the closest investigation and perhaps the consent of the correspondents.


William Lyon Mackenzie King: I do not know what "private and confidential" correspondence my right hon. friend alludes to.


Arthur Meighen: It is marked.


William Lyon Mackenzie King: There is some marked "private and confidential?"


Arthur Meighen: Oh, yes.


William Lyon Mackenzie King: I have no objection to the "private and confidential" letters not being brought down, but I think the rest

Miners and Steel Workers
of the correspondence should toe available at the earliest date. It was asked for by my right hon. friend, who requested production of correspondence not only from the Department of External Affairs but also from the Department of Trade and Commerce.


Arthur Meighen: What I asked for was
correspondence with the British government or the Imperial Shipping Committee. From what I have seen, this is correspondence written by various people in Canada to the Minister of Trade and Commerce, and is all marked "private and confidential" or "personal and confidential." I have not read any of it.


William Lyon Mackenzie King: How many
letters are marked "private and confidential?"


Arthur Meighen: I have only had time to look at a few. The last one is; the next one is, apparently most of them are.


William Lyon Mackenzie King: Are there any others?


Thomas Andrew Low: I may say that that letter was
placed on the general file by the ex-Minister of Trade and Commerce when he left the office.


Arthur Meighen: It may be all right, I
am not saying any of it is necessarily private and confidential; I have not had time to read any of the letters. We are asked to order the printing and publication on one second's examination. I suggest that as to this correspondence the motion be postponed.


William Lyon Mackenzie King: I do not wish to press the motion for the printing; it can be moved to-morrow if my right hon. friend would like to have an opportunity to look over the correspondence. I suggest, however, that the first part of the resolution, in respect to the correspondence laid on the table yesterday and to which my right hon. friend has no objection, be adopted.


Mr. SPEAKER:: The motion will therefore read:
That one thousand copies in the English language and five hundred copies in the French language of the correspondence between the government of Canada and the British government in regard to the subject of ocean rates, and especially in relation to the Imperial Shipping Committee, laid on the table of the House on Monday, the ninth of March, be printed forthwith, and that rule 74 be suspended in relation thereto.
Is it the pleasure of the House, by unanimous consent, to adopt the motion as amended?
Motion, as amended, agreed to.



PENSIONS AND RE-ESTABLISHMENT

[Stage Direction]
On the Orders of the Day:
Hon. R. J. MANION (Fort William and Rainy River):: Before the orders of the day are proceeded with I would like to ask the Minister of Soldiers' Civil Re-establishment (Mr. Beland), in view of the fact that it was stated by the Senate last year, when amendments respecting pensions and re-establishment came before them, that they came too late to be properly dealt with, whether any amendments contemplated this year will be brought in sufficiently early to permit a thorough discussion of them, and to give the Senate ample opportunity to consider them?


Hon. H. S. BELAND (Minister of Soldiers' Civil Re-establishment):: It is my intention
to bring down the legislation as soon as possible. It will be delayed a few days longer because I have been notified that a delegation of returned men intend to interview myself and perhaps the government as a whole in connection with the proposals to be brought down. That is the only reason for postponing the presentation of the bill.



MINERS AND STEEL WORKERS

[Stage Direction]
On the Orders of the Day:
Mr. JOS. T. SHAW (West Calgary):	I
desire to ask the Prime Minister (Mr. Mackenzie King): if he has received the following telegram from Mr. A. C. McCormick, mayor of Sydney Mines:
Large citizens' meetings held here, third. Committee of town council urging clergy, 'board of trade and business and professional men appointed to draw up resolution to correct false impressions arising through speeches of Cape Breton representatives in parliament. Conditions here exceedingly bad. Work very slack since New Year and many in distress. Churches opening food depots and British-Canadian Co-operative Society opening soup kitchens. All members of this committee are outsiders and have no connection with labour union and deprecate efforts to make it appear that conditions anything but bad. Besco has cut off credit at its store to workmen. Wish to impress upon the public that grave situation exists and repudiate statements to the contrary made in parliament. Last week 127 families, 254 adults, 640 children supplied food for one week by citizens relief committee from contributions of citizens of Sydney Mines. Soup and sandwiches to 886 school children Thursday to Monday supplied by British-Canadian Co-operative Society. This week's requirements for week's food supply estimated 210 families, 420 adults, 1,050 children. Doctors report many cases influenza. Receiving no assistance from outside sources. Situation very grave, local resources about exhausted. Would earnestly implore financial assistance from the government of Canada as the provincial government sending no relief.
If the Prime Minister has received this telegram, has he made any inquiry as to its authenticity and is any relief proposed for
Naturalization Laws
[Stage Direction]
what would appear to be a very grave situation in that district?
William Lyon Mackenzie King: I received last night a
telegram in the words, I think, of that which has just been read by my hon. friend. I instructed my secretary to acknowledge it and say that its representations would receive the government's consideration. I brought the representations set forth in the telegram to the attention of my colleagues in council today. The position the government takes in the matter is this: The Premier of Nova Scotia has already intimated to the president of the Mine Workers' Union that the government of Nova Scotia would be prepared to co-operate in any matters of distress where it appears that the municipalities are not able to take care of the situation. This government, therefore feels, that unless requested by the government of Nova Scotia so to do, we should not intervene at this time.



PRIVILEGE-MR. CARROLL

[Stage Direction]
On the Orders of the Day:
Mr. W. F. CARROLL (Cape Breton South and Richmond):: Mr. Speaker, I rise to a
question of privilege. I notice that in a telegram read by the hon. member for West Calgary (Mr. Shaw), Mr. A. C. McCormick states that he wishes to correct a wrong impression conveyed by members for Cape Breton regarding the situation in his district. I may say that I made but a passing reference to the district of Sydney Mines, which is not in my constituency. In my speech on this question I dealt almost wholly with the situation as it pertained to the constituency which I have the honour to represent, and therefore could have created no wrong impression.



CIVIL SERVICE COMMISSION

[Stage Direction]
On the Orders of the Day:
Mr. H. C. HOCKEN (West Toronto):: I
would like to ask when I may expect an answer to my question, which stands No. 1 on the order paper?


William Lyon Mackenzie King: As soon, I think, as the Secretary of State (Mr. Copp) returns, which I am told will be tomorrow.



ALLEGED MERGER OF POLITICAL INTERESTS

[Stage Direction]
On the Orders of the Day:
Mr. J. L. STANSELL (East Elgin):: I wish to ask the Prime Minister a question based on a report in the issue of the Toronto Globe of

March 9. The heading is, "Liberals and Progressives Join to Back Low Tariff Candidate." It reads in part as follows:
Representatives of both Liberals and Progressives, at a meeting in the Battersby house here, unanimously agreed on a merger of political interests in Norfolk county. . . . The following resolution .... was unanimously adopted:
" That this meeting expresses its approval of the nomination of a low tariff candidate to contest the riding of Elgin-Norfolk-
It should be Norfolk-Elgin.
"-in the coming Dominion election.
" That to this end a convention, representative of all low-tariff electors of the riding, be called to make the said nomination.
" That the said candidate, when elected-"
Evidently they are sure of election.
"-is pledged to give independent support to, and join the caucus of whichever low-tariff party -may be in power, whether it be under the leadership of Mr. King or Mr. Forke."
Now, I know well the abhorrence that this government has always felt in regard to mergers and combines, and I wish to-


Some hon. MEMBERS:: Order.


Hewitt Bostock: The hon. member may
not make a speech on the orders of the day. He may simply put a question to the government.


John Lawrence Stansell: The question I wish to
ask is this: In the event of the success of the merger or combine, whichever you wish to call it, in the various ridings, will the government abandon the idea of the single transferable vote?


William Lyon Mackenzie King: I will answer that question after the event to which my hon. friend alludes has taken place.



NATURALIZATION LAWS AMENDMENT

[Stage Direction]
On the Orders of the Day:
William Lyon Mackenzie King: On the orders of the day
yesterday I promised the hon. member for Lisgar (Mr. Brown) that I would give him a statement to-day with respect to a question he asked. The question was-
-whether the government has received any communication from the . British government relative to the amendment of the naturalization laws to prevent a woman of British nationality married to an alien from losing her British citizenship except by declaration of alienage, and providing for the re-admission to British citizenship of British women married to aliens where the marriage state, although officially existing, has for all practical purposes terminated?-and, if so, what measures the government proposes to take to secure the removal at the earliest passible moment of the disabilities in this respect now resting on Canadian women ?

Ocean Shipping Rates
Perhaps my hon. friend will pardon me if I read the reply as well:
A despatch dated November 6, 1924, was received from the Colonial Office on November 17, enclosing for consideration a draft bill which embodied two amendments to the Naturalization Acts, 1914-1922, carrying out recommendations of the Imperial conference of 1923, one providing for issuing naturalization certificates to inhabitants of mandated territories, and the other providing for the readmission to British nationality of natural-born subjects married to aliens where the married state, though subsisting in law, has to all practical purposes come to an end.
The despatch also suggested for consideration two other changes which were under consideration, but as to which no definite recommendation was made; one of these suggestions was that a British-born woman should not on marriage lose her British nationality if and so long as she does not acquire the nationality of her husband under the law of his country. No proposal has been received from the British government to the effect indicated in the first part of the question of the member for Lisgar, that a woman of British nationality on marriage to an alien should not lose her British nationality except by declaration of alienage.
As to what measures the government proposes to take to secure the removal at the earliest possible moment of the disabilities in this respect now resting on Canadian women, I would say, that this matter has been referred to the departments of the Secretary of State and of Justice for consideration and report to council, and an announcement with respect to the action of the government thereon will be made at a later date.



GRAIN INQUIRY COMMISSION

[Stage Direction]
On the Orders of the Day:
Mr. ROBERT GARDINER (Medicine Hat):: On February 27, the Minister of Trade and Commerce laid on the table of the House the evidence taken before the Royal Grain Inquiry Commission. On going over the evidence I find that the evidence that was taken at the special session at Vancouver from May 16 to June 5 inclusive is not included. Is it the intention of the minister to table that evidence?


Thomas Andrew Low: I thought that evidence had been included with the other. I will see that it is tabled.
OLD AGE PENSIONS On the Orders of the Day:


Mr. WILLIAM IRVINE (East Calgary):: I would like to ask if the government have made any progress towards bringing down an Old Age Pension Act, and if we may expect such an act this session.


Hon. JAMES MURDOCK (Minister of Labour):: The matter has received further consideration by the government as a result of the answers received from the various provincial governments, and within the next few days we shall be in a position to further advise the House as to what action will be taken.



DOMINION ELECTIONS ACT AMENDMENTS

[Stage Direction]
On the Orders of the Day:
Mr. J. S. WOODSWORTH (Centre Winnipeg):: Can the Solicitor General give us any intimation as to the time when the amendments to the Elections Act will be brought down?


Hon. E. J. McMURRAY (Solicitor General) :: We are giving attention to that matter now, and expect to bring down the amendments very shortly.
RURAL CREDITS On the Orders of the Day:


Mr. M. N. CAMPBELL (Mackenzie):: I would like to ask the Acting Minister of Finance if he is now in a position to make any announcement of governmental policy in regard to rural credits.


James Alexander Robb: I have nothing further to add to what I stated the other day.



CORRESPONDENCE ON OCEAN SHIPPING RATES

[Stage Direction]
On the Orders of the Day:
Hon. H. H. STEVENS (Vancouver Centre):: I am sure the Prime Minister will welcome another word in regard to this correspondence. I find on this file a letter marked "personal and confidential," written by myself when I was Minister of Trade and Commerce in 1921 to the Deputy Minister of Trade and Commerce, enclosing a letter marked "confidential". This enclosure was a letter addressed to me at Vancouver and in my letter to the deputy I pointed out that, being absent from Ottawa it was impossible for me to take action regarding it, and I submitted it to the deputy marked "personal and confidential." That letter certainly should not appear on this

Toronto Viaduct

file. There is nothing damaging in this letter, nor anything that could not be published, except that the party who wrote the letter marked it "personal and confidential", and he cites personal experiences which I do not think any manufacturer or tradesman would like to have published to the world without his consent. I have no objection at all to the rest of the file: but I am surprised that this particular letter should appear on the file at all.


Thomas Andrew Low: I can only say in reply to my
hon. friend that I asked my deputy to have a copy made of the correspondence, and the file is just as it was handed to me. I take it that the letter my hon. friend refers to which was marked "personal and' confidential" was placed on the general file when he was Minister of Trade and Commerce. If he had considered it a personal letter I have no doubt he would have taken it with him when he left the department.


Henry Herbert Stevens: It is not a letter addressed to me. I have not the custody of it. It is a letter addressed by me to the deputy minister enclosing a personal and confidential letter.


Thomas Andrew Low: My hon. friend is referring to a letter addressed to him as Minister of Trade and Commerce?


Henry Herbert Stevens: No. Show the two of
them to the Prime Minister. He will understand it.


William Lyon Mackenzie King: My hon. friend is quite
right in saying that there is a letter addressed to himself as Minister of Trade and Commerce marked "personal and confidential"; then there is also a letter addressed by himself to the deputy minister marked "personal and confidential", and signed "H. H. Stevens, Minister." I assume the reason this letter has been kept on the file is that the deputy minister regarded it as a request for departmental action. However, Mr. Speaker, as far as these letters are cocerned, if my hon. friend would like to have them considered as personal and confidential I am sure that every member of the administration will wish to have them withdrawn from the file, and I shall be happy to have that done. But I would take it for granted that personal and confidential letters, the minister would take with him on leaving the department.


Henry Herbert Stevens: My right hon. friend mistakes the situation. It is a letter from me.
I was not in custody of the letter at all; it left my hands in Vancouver, and was sent to the deputy minister in confidence, enclosing a 
confidential letter. I had not it in my custody; so I could not take it out of the file.


William Lyon Mackenzie King: These letters
have been laid on the table of the House, but I presume the House will give its consent to the letters to which my hon. friend refers being withdrawn. If so, I would like to request that they be withdrawn. My right hon. friend the leader of the opposition has intimated that with these letters withdrawn he is agreeable to having the rest of the correspondence printed. I think it would facilitate the debate if all the correspondence were printed at the same time; so if we might return to that motion, Mr. Speaker-


Hewitt Bostock: I shall have to put the
question again. By unanimous consent, it is moved:
That one thousand copies in the English language and five hundred copies in the French language of the correspondence between the government of Canada and the British government in regard to the subject of ocean rates, and especially m relation to the Imperial Shipping Committee, laid on the table of the House on Monday, March 9, and one thousand copies in the English language and five hundred copies in the French language of the correspondence from the Department of Trade and Commerce regarding transatlantic freight and passenger rates, laid on the table this day, be printed forthwith, and that rule 74 be suspended in relation thereto.
Is it the pleasure of the House to adopt the motion as re-amended?
Motion as re-amended agreed to, by unanimous consent.


Arthur Meighen: While on this subject,-
the former Minister of Trade and Commerce asked some little time ago if there was any other material that could be presented to the House besides the Preston report. The Prime Minister was at that time of the view that there was not. It occurs to me there probably is some other correspondence between 1921 and 1925 having to do with the same subject passing (between the government and other parties, of the same nature as that ordered to be printed now. If so, it should all be ordered to be printed together.


William Lyon Mackenzie King: I am sure it
would be satisfactory if there are any such letters, to have them laid on the table and printed. I will ask the departments to make a search and see that any such letters are brought down if possible to-morrow.



TORONTO VIADUCT

[Stage Direction]
Hon. GEORGE P. GRAHAM (Minister of Railways and Canals) moved that the House go into committee to consider the following proposed resolution:

Ocean Shipping Rates
Resolved, that it is expedient to amend the provisions of section 6 of the Act respecting the Toronto Terminals Railway Company, chapter 70 of the statutes of 1924, whereby the Canadian National Railway Company was authorized to issue bonds, debentures or other securities to an amount not exceeding seven million dollars, in addition to the issue authorized by subsection two of the section enacted thereby; and to provide that such bonds, debentures or other securities may be used,-
(a)	in the purchase at par of securities issued by the Terminals Company not exceeding, together with the securities purchased under the provisions of subsection two, one-half of the total securities to be issued by the Terminals Company for the purpose of its undertaking;
(b)	in defraying the cost of portions of the said viaduct and works, which will not be included in the works to be owned by the Terminals Company, and will have to be constructed for or by the Canadian National Railway Company itself.
He said: The object of this resolution is to amend the statute passed a year ago in reference to the construction of what is known as the viaduct in Toronto. The construction of that viaduct wild take place under the purview and control of what is known as the Toronto Terminals Railway Company, made up of the two railway companies, the Canadian Pacific and the Canadian National. It has been found that each railway company has certain works that come within the viaduct agreement but are outside of the purview of the Terminals company, and this is merely to allow the Canadian National railway, because that is the only company we deal with, to spend a portion of the money in constructing the works that belong to it solely. This resolution makes no difference as respects the expenditure or the bonding powers.
Sir HENRY DRAYTON:: It simply enables the work to go on?


Mr. GRAHAM:: Yes.
Motion agreed to and the House went into committee, Mr. Gordon in the chair.
Resolutions reported, read the second time and concurred in. Mr. Graham thereupon moved for leave to introduce Bill No. 23, respecting the Toronto Terminals Railway Company.
Motion agreed to and bill read the first time.
Mr. Graham moved that the bill be now read a second time.


Mr. C. G. POWER (Quebec South):: Does this motion require the unanimous consent of the House?


Hewitt Bostock: Yes.


Charles Gavan Power: Then I object to it.
61$


Hewitt Bostock: Objection having been
taken the motion stands until the next sitting of the House.
Motion stands.



OCEAN SHIPPING RATES


[Stage Direction]
The House resumed, from March 3, the adjourned debate on the motion of Hon. T. A. Low (Minister of Trade and Commerce) to ratify and confirm a contraot between His Majesty and Sir William Petersen providing for the establishment of a subsidized steamship line on the Atlantic, and government control of certain ocean rates.
Mr. J. A. CLARK (Burrard):: 
Mr. PARENT:: Would the hon. gentleman repeat the same statement outside of the House of Commons?


John Arthur Clark: At any time and any place.


Georges Parent: We shall see that later on.


John Arthur Clark: It is quite obvious that Sir William Petersen need not even submit to the government an assignment of the subsidy. Whenever he sees fit to assign this contract, he can do so and then the government will have no hold upon him. He need not even advise the government that he has assigned the contract. Moreover, he may assign this contract to a stock-jobbing company anywhere in the world, to any promoters, if he so desires, despite the fact that that company which he forms now may
Ocean Shipping Rates

have no other capital in this world than the subsidy which is referred to in this agreement.


William Lyon Mackenzie King: Is it not the practice of shipping companies, after a ship has been built, immediately to transfer that ship to a separate company, the idea being, in case of damage or loss at sea, to limit the liability of the company? Was that not the practice that was adopted by the preceding government with respect to the Canadian Government Merchant Marine?


John Arthur Clark: I do not dispute anything the Prime Minister has said, but he should have safeguarded the interest of the taxpayers of this country by having in this agreement some provision whereby the government could scrutinize the company to which this subsidy is to be assigned.


William Lyon Mackenzie King: Scrutinize the
ships?	,


John Arthur Clark: Scrutinize the company, see
that the company is a reputable company. That is my point.


William Lyon Mackenzie King: The contract is so drawn that not a single cent is contributed by the government to the company unless the service is actually performed.


John Arthur Clark: 
William Lyon Mackenzie King: I think my hon. Iriend ought to be more careful in the statements he is making. The government is not giving Sir William Petersen any money for building ships. The contract with him is a contract to allow the government to control ocean rates, and in consideration of the government being given control of ocean rates, of fixing whatever rates it wishes on whatever commodities are transported, the government proposes to give Sir William Petersen a certain amount after the service is performed. Nothing is said as to where the ships are to be built.


John Arthur Clark: That is what I object to.
I object most emphatically that nothing is said as to where the ships are to be built. What I wish to point out is this, that though the money is not being advanced merely for the purpose of building the ships, 4 p.m. the subsidy actually exceeds the cost of the ships. If we are going to advance nearly twice as much as is necessary to build these ships, why not own them ourselves? Then, we might have an opportunity of fixing the rates. At this point, it might be fitting to refer to the Canadian Government Merchant Marine. If this is such a good scheme, why not turn these ships over to the Canadian Government Merchant Marine which has available to-day sixty ships with a total tonnage of 360,000 odd tons as compared with the Petersen tonnage of 90,000 tons? The Canadian Government Merchant Marine has available to-day over 400 per cent more tonnage than Petersen will have when he gets all his ships built.


William Lyon Mackenzie King: They are no
good.

Ocean Shipping Rates


John Arthur Clark: Oh, I am glad to hear the Prime Minister assert that the ships of the Canadian Government Merchant Marine are no good. I have been assured by shipping men on the Pacific coast and on the Atlantic coast that these ships are suited for the trade. On the Pacific I see these ships going out and coming in with full cargoes, I see them performing a great service to us in British Columbia. And I raise this objection right now, that the Prime Minister under this contract has made no provision for the Pacific coast. That is another discrimination against the western route and the Pacific coast for which he is personally responsible.


William Lyon Mackenzie King: If my hon.
friend will study this contract he will see it contains a provision whereby the government is free to make the same arrangements with any other shipping companies-the Canadian Government Merchant Marine, the Canadian Pacific or any other shipping company. The government reserves that right and may exercise it at any time from any port.


John Arthur Clark: I am objecting that the
Prime Minister has not made that arrangement now with the Canadian Government Merchant Marine. If it is such a good proposition, why pass over our own ships?


William Lyon Mackenzie King: Wait and see
how this works out. We are not taking chances of any loss on the contract.


John Arthur Clark: The Prime Minister stated
the other day that the Canadian Government Merchant Marine was not withdrawn earlier from the combine because he was afraid the combine would immediately attempt to put the Canadian Government Merchant Marine out of business. In other words, he was afraid to have the Dominion of Canada go to war with this combine. But he selects Sir William Petersen-


William Lyon Mackenzie King: No, he did not select him.


John Arthur Clark: Sir William Petersen

a man without a fleet-the Prime Minister selects him to go to war with this combine. Some one remarks that you might as well go to war against the combine or conference with a hay rake or with a bow and arrow, and it is only too true. If this is a good scheme, and even assuming-which I flatly contradict-that, as the Prime Minister says, the Canadian Government Merchant Marine ships are .no good,-


William Lyon Mackenzie King: Those that
are not in use, yes.


John Arthur Clark: That is qualifying his first
assertion. There are only nine not in use on the ocean.


William Lyon Mackenzie King: Oh no.


John Arthur Clark: Furthermore, assuming its soundness, if Sir William Petersen, without putting up a cent of capital, with his ships built at the country's expense, can make 20 per cent net profit per annum on their cost, why give him a subsidy? Why not allow him to build his own ships and make the 20 per cent? What necessity is there for any subsidy?


Edward James McMurray: If it is a fact that under the contract the government controls the rates, will they not necessarily control the man's profits and his rate of profit?


John Arthur Clark: I suggest that if the government does not allow Sir William Petersen to charge exactly the rates which are being charged by the conference lines to-day, he will say, " The subsidy is of no use to me; I withdraw." Then the government can do nothing, for there is no penalty provided. He gets the subsidy, that is all.


Mr. McTAGGART:: What did the hon. member say it would cost to build those ships?


John Arthur Clark: It will cost $600,000 apiece; $6,000,000 for the ten.


Mr. DUFF:: Does the hon. member say that the government is going to put up $6,000,000 to build the ships?


John Arthur Clark: No. If the hon. member had been here a few moments ago and heard the discussion between the Prime Minister and myself on that point he would not have asked the question.


William Duff: Yes, I was here.


Henry Lumley Drayton: The government only pays a little more than twice that.


Georges Parent: That does not make it any clearer.


William Duff: Will the hon. member answer my question: Does he say that the government intends to put up the $6,000,000 to build those ships?


John Arthur Clark: Most assuredly I will answer the question. What I say is this: The government is giving a subsidy to Sir William Petersen of $1,300,000 odd when he provides the ten ships.


William Duff: That does not answer my
question.


John Arthur Clark: I will answer the question
if my hon. friend gives me the chance. I have already answered it, but I will try to oblige my hon. friend. Sir William Petersen or his company will get $1,300,000 odd an-

nually. All he must do is supply a fleet of ten ships, which will cost him $6,000,000. If Sir William Petersen is any sort of financier he can have the ships built on credit and he will not have to put up a cent himself. At the end of ten years he will have received from this country about $13,330,000 and his capital investment will have been only $6,000,000.


William Duff: Will my hon. friend allow me another question? Suppose three weeks after these ten ships are built and put in operation they are all lost, will Sir William Petersen get the $13,000,000 that the hon. gentleman is talking about?


John Arthur Clark: No, but I presume he will
get the insurance.


William Duff: Yes, out of which he would
have to meet the cost of his ships; he would not get it from this government. My hon. friend said he would get it from the government.


John Arthur Clark: Oh, the subsidy might end
in many ways. Sir William Petersen may say at any time: "This government is not dealing fairly with me," and he may quit when he pleases without penalty.


An hon. MEMBER:: In that event he
would not get the subsidy.


John Arthur Clark: It might be interesting at
this point to consider the capacity of these ships and what effect this contract will have upon the rates fixed by the conference lines. The total capacity of one of these ships for one season, if engaged exclusively in the carrying of grain out of the port of Montreal, would be a little over 1,300,000 bushels. This is on the basis of four and a half trips a season, on the average, so that the total fleet would carry about 13,000,000 bushels. Now, in 1924 there were shipped out of the port of Montreal about 152,000,000 bushels of grain, and of that amount over 80,000,000 bushels consisted of grain that came from the United States and was shipped out by the harbour commission. So that if we extended this subsidy five-fold, if we gave Sir William Petersen a fleet of fifty ships, the best he could do-would be to carry out of the port of Montreal about 65,000,000 bushels of grain in one season. He could not even carry the American grain that goes through that port; with a subsidy amounting to considerably over $6,600,000 a year. Thus if an attempt is made to make the service worth while, a subsidy five times what is now proposed would not begin to meet the case. We might involve this country in the payment of nearly $70,000,000 by way of subsidy, but even at that we could not

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move the American grain that annually goes through the port of Montreal.


Mr. MOTHERWELL:: Why not make it
$100,000,000 while you are at it?


John Arthur Clark: Well, you can make it $100,000,000 in all, and over a period of ten years the Minister of Agriculture will not succeed in moving much more than the total amount of American grain offering for shipment at Montreal.


William Richard Motherwell: Keep on figuring
and make it $200,000,000.


John Arthur Clark: I am putting these figures
on Hansard; if the Minister of Agriculture sits down and works them out he will find them to be correct.
The Prime Minister (Mr. Mackenzie King) suggested the other day that the government was going to control the situation, that only Canadian commodities would be carried on these ships. Now, let us see what this cast-iron contract provides in that regard. Paragraph (d) of clause 1 says:
That the control and regulation of the rates to be charged by the contractor shall rest with the government of Canada and that the government shall fix such transportation rates on all commodities from time to time.
There is not one word in this contract which enables the government to say what commodities shall be carried. The government may fix a fancy schedule of rates covering hundreds of commodities; it may fix rates on three or four commodities which may be regarded as favourable to the carrier. Sir William Petersen may under this contract carry those commodities on which favourable rates are fixed to the exclusion of all others, and there is no power on the part of the government to say he must not do that. I am quite prepared to have my opinion on that point submitted to any reputable lawyer in this country, even to Mr. Lafleur, who drew this contract.


William Lyon Mackenzie King: That is aside from the question. I do not want to interrupt my hon. friend, but does he contend that the government has not the right to fix rates on the commodities?


John Arthur Clark: I am not talking about that.


William Lyon Mackenzie King: That is the
whole point. The government can fix whatever rates it pleases on whatever commodities it pleases.


William Duff: On all commodities.


John Arthur Clark: Most assuredly; and if the
government fixes favourable rates on a few
commodities Sir William Petersen may carr>
those commodities to the exclusion of all the others upon which the government has fixed lower rates. That is the fact, under this agreement.


William Duff: Will my hon. friend refer to
clause (d), in which it says-


John Arthur Clark: I have given it.


William Duff: Will he refer to it again?
He will see it provides that the government can fix the rates on all commodities, not on some commodities. Does that not cover everything?


John Arthur Clark: Certainly; the government
may prepare a most complicated schedule covering every known or imaginable commodity, and Sir William Petersen may pick from that schedule the commodities he chooses to carry. He may carry those commodities upon which favourable rates are fixed, and he may do so to the exclusion of those commodities on which low rates are fixed.


William Duff: No, no.


Arthur Meighen: Why not?


William Duff: It says "all commodities."


John Arthur Clark: Further, if Sir William Petersen so desires, under this clause he may carry American grain to the exclusion of Canadian grain. I do not say that he will; I do not suggest that at all; but I do suggest that it will be impossible for the contractor or any carrier to distinguish between American and Canadian grain. They are mixed, and Sir William Petersen may carry, and will carry, American grain out of the port of Montreal; in other words the Prime Minister is subsidizing Sir William Petersen in order to relieve the already overburdened taxpayer of the United States by carrying the commodities that are grown in the United States and shipped through the port of Montreal. That is what it amounts to.


Mr. PUTNAM:: If the grains are mixed,
is not that the utmost physical proof that the government could control the rate on Canadian grain?


John Arthur Clark: I am not talking about rates, but about the Prime Minister's suggestion that he can insist upon Sir William Petersen carrying Canadian commodities to the exclusion of American commodities.


William Lyon Mackenzie King: I do not want to interrupt my hon. friend, but he keeps referring to me all the time and misrepresenting my point of view. I hope he will not
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think if I sit silent that I agree with what he says. By specifying the commodities on which the low rates are to be given, and with the rates fixed by the government, I think the matter would be settled as to carrying Canadian commodities.


John Arthur Clark: Is there a difference between Canadian wheat and American wheat?


William Lyon Mackenzie King: A very distinct difference. The government will fix a rate for Canadian wheat, and Canadian wheat and no other wheat will get the benefit of that lower rate.


John Arthur Clark: How can the Prime Minister distinguish between Canadian and American wheat? Will he have American wheat come into one elevator and Canadian wheat into another? Must they be kept separate, or is he going to prohibit American wheat from coming into Montreal at all? That is what will happen if he attempts any such thing.


Mr. GARLAND (Bow River):: Why does
the hon. member pick out wheat alone? We are practically all aware that wheat is not included in the conference rates.


John Arthur Clark: I chose wheat only for the
purpose of illustration, and because it is the commodity that probably fifty members to my left are more interested in than any other. I might just as well take half a dozen other commodities.


Mr. LEADER:: Take cattle.


John Arthur Clark: I will take cattle, but if my hon. friend will bear with me, I will take cattle when I come to the Preston report.
There is one other paragraph in the contract to which I would like to refer. It is paragraph 1 (f), by which the contractor agrees to:
Carry emigrants from Great Britain or the continent of Europe at rates to be fixed by the government and carry all Canadian mails free if and when the parties hereto agree upon the establishment of a passenger service or other steamers suitable for the carriage of emigrants in conjunction with and under the control of the shipping company.
Now the Minister of Trade and Commerce, in introducing this resolution, stated repeatedly that there was nothing retarding immigration to this country more to-day than the action of this gigantic combine. The tragedy of this covenant is that there is no provision in these ten ships which the subsidy covers for the carriage of one single immigrant; no provision whatever, and yet the minister as his main point in favour of this subsidy says that nothing is retarding

immigration to this country to-day more than the action of this gigantic combine. That is via reason he advances why we should adopt, this agreement. There is a real tragedy in this covenant. We have today space in the ships which are coming to New York and Montreal for well over a million immigrants a year for Canada. We have space in the ships which call at Canadian ports alone for over 350,000 immigrants to Canada annually; and that space is not being utilized. In the United States, until they introduced their quota law they were securing upwards of one million immigrants a year on these same ships which are still travelling the same routes; but when the quota law came into effect, immigration to the United States was cut down to about 360,000 annually. The United States have now a waiting list of would-be immigrants, probably the pick of the immigrants from the whole of the Mother Country and Europe, sufficient to fill their quota for many years to come, showing full well that there are immigrants who are ready and willing to come to Canada, and to pay the rates at present existing if we have anything here to offer them. The tragedy, Mr. Speaker, is that we have no attractions to offer immigrants to-day; we have the immigrants ready and willing to come, but we have no work for them. The minister says that nothing is retarding immigration to this country more than the action of this gigantic combine. He might just as well say that the exodus annually to the United States of 200,000 of our best young men, upon whom we have spent millions of dollars to rear and educate, the very life blood of this country-he might just as well say that that exodus is due to the action of this gigantic combine. The fact is, Mr. Speaker, that until this country has attractions to offer, we cannot hope to have a free flow of immigrants to this country, and I want to say this to my friends particularly to my left: Until this country has a general tariff equal to that of the United States-and some time my hon. friends to my left will be believers in that-we cannot hope to make this country attractive to immigrants, because we shall have no work to offer them. If we do not encourage industry, and if we do not stop the flow of manufactured goods from the United States to this country, we cannot hope to offer opportunities to immigrants.


Mr. SPENCER:: Does the hon. member
not realize that in the year 1913, when we had a tariff, conditions were just as bad as they are to-day?

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John Arthur Clark: In 1913, in my city, and in
nearly every city and town and village of Canada, we all had full pockets, and we had
400.000	immigrants in that year. While I
am on that point, let me suggest this to my hon. friends to my left:	Supposing we had a
free flow of immigrants to this country, supposing that every inch of space in these immigrant ships was taken up, that we had say
350.000	immigrants a year; that would provide a return cargo from the Mother Country which is not being provided to-day. The shipping men complain that there is no return cargo. Well, there is an opportunity to provide a return cargo, and if it is provided-


Mr. MARTELL:: If my hon. friend will
permit me to interrupt I should like to ask him what the bringing in of immigrants has to do with this question? My hon. friend is a lawyer, he knows the rule, res inter alios acta, as regards evidence.


John Arthur Clark: My hon. friend possibly was not in the House when I took this matter up.


Lewis Herbert Martell: It has nothing to do with the question.


John Arthur Clark: I was reading from a covenant in the agreement with respect to the bringing in of immigrants.


Lewis Herbert Martell: I do not speak merely for the sake of interrupting, but I point out to my hon. friend that we are dealing with freight, not with immigrants.


John Arthur Clark: I am dealing now with the
covenant contained in this agreement with Sir William Petersen that he will carry immigrants from Great Britain or the continent of Europe at rates to be fixed by the government, and so on. In addition to the argument that the free movement of emigrants into this country would assist all of us in securing cheaper rates on cargo outbound I suggest this:	That if we stopped the present tremendous flow of manufactured goods from the United States, we could then negotiate proper and advantageous trade treaties with the other British dominions and with the Mother Country herself, and thus provide infinitely larger return cargoes which would react to our benefit when we were shipping outwards. It is only by filling these, ships both ways that we can hope to secure a really equitable distribution not only of cargo but of freight rates.


Milton Neil Campbell: Does the hon. gentleman realize that a reduction in the duty on British goods coming into Canada would help to fill these ships with return cargoes, and would he be in favour of that policy?


John Arthur Clark: Absolutely no, and I will tell my hon. friend why: My whole argument is to stimulate Canadian industry first. Secondly, having stimulated Canadian industry and having made it possible for emigrants to flow into this country our next duty would be to stimulate trade with the Mother Country, and with the other British dominions as well, by diverting trade from the United States. I will show my hon. friend the great necessity for that. In 1923 our total imports amounted to $802,579,244. Out of that total the United States sent us $540,989,738, while the Mother Country only sent us $141,330,443. Now, what I say is let us divert some of that trade with the United States to the Mother Country. But first of all let us stimulate Canadian industry.


Mr. EVANS:: What means would the hon. gentleman use as a stimulus?


John Arthur Clark: I mean just what I said. We should have a tariff on a parity with that of the United States, wherever possible, first of all in order to stimulate Canadian industry, in order to provide employment for our idle workers, and in order to stop the exodus of
200,000	of our best young men annually to the United States. When we do that we will attract other people to our country.


Mr. MacLEAN (Prince):: How do you
account for the unemployment situation in the United States? According to the official figures last year was the worst year they had in that respect, and there were in the city of Brooklyn alone over 300,000 persons out of employment.


John Arthur Clark: I am not discussing conditions in the United States just now but I will tell you this: In the year of the presidential election there is always depression in the country to the south. If my hon. friend will examine the figures issued by the United States Steel Corporation, or any other great corporation throughout the American union, he will find there has been a tremendous increase in the orders placed with industrial concerns, and there is no longer much unemployment in the United States.
Now, Mr. Speaker, I should like to refer very briefly to the Preston report. I am going to take several statements from that report, chosen at random, for the purpose of showing that that report might just as well be thrown into the waste paper basket and the country saved further expense in giving consideration to the recommendations made therein. On page 3 Mr. Preston says:
I was in a position to get in touch with all the interests concerned, without unnecessary deJay.
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Every interest concerned denies that Mr. Preston was ever in touch with it. On page 4 he accuses the Canadian Pacific of having bought out the Elder-Dampster Steamship Company in order to destroy it as a competitor against the interests of the combine. Now, the Canadian Pacific Ocean Steamship service have issued a Statement that the Elder-Demp-ster Steamship Company was purchased long before they were ever a member of the conference. I am prepared to accept the statement of the Canadian Pacific Ocean Steamship service, because I do not believe it would make such a statement if it were not perfectly true. Then Mr. Preston says on page 6:
According to the records of the Department of Trade and Commerce, a pronounced discrimination was immediately declared against Canadian ports and in favour of American ports as the settled policy of this steamship combine.
I do not know much about rates, but I do know that Canadian goods can reach American ports as cheaply in many instances as they can reach Canadian ports, and yet we find that Canadian goods are exported via Canadian ports despite the allegation that ocean rates from American ports are lower than from Canadian ports. I have not the statement before me but I think it will be found in the form of an answer to a question in to-day's Hansard that during the last two years less than three millions out of nearly three hundred millions of imports from the Mother Country came via Canadian ports. Now if there is discrimination in favour of American ports why would not more of these goods come via those ports? If there is that discrimination why is American wheat not exported via American ports? Why is the port of Montreal chosen? Think of it, eighty million bushels of American grain, more than one-half the total shipment from the port of Montreal, are shipped through that port in preference to New York, or other maritime ports in the United States. Why do we have that situation if the assertion in question is true?
Then on page 23 we find the assertion to which I have already referred, that the advantages intended to be given by the British preference have long since been swallowed up by the increased cost of ocean transportation.
The answer to that was given by my hon. friend from West York (Sir Henry Drayton) years ago and was confirmed by the Dominions Royal Commission page 11. There is a significant paragraph on page 25:
The conclusion is inevitable that a combine exists between all trans- Atlantic shipping lines running regularly between Great Britain and the continent of Europe and the Dominion of Canada.

You will note that the whole Dominion of Canada is included; yet I say again that the western route has been once more given the go-by by this government. This simply adds to the record of the government's attitude toward British Columbia on the question of the mountain scale, the western grain rate and the customs officer at New York. And now we find in this Petersen agreement no provision for sailings from Vancouver. Judging from the rates charged on wheat from the port of Vancouver, one would take it that if there is a discrimination that discrimination is against the port of Vancouver rather than the port of Montreal. I find that the rates on wheat from Vancouver to the United Kingdom ranged between twenty-two and twenty-six cents for the first part of 1924, and were around nineteen and twenty-two cents from July on. The rates from Montreal to Liverpool ranged from 6.8 to 10.3 per bushel during May, June, July and August; between 8.3 and 9.3 in September; between 9.1 and 9.9 in October and around 10.6 in November. The distance from Vancouver to London is 8,852 miles while the distance from Montreal to London 3,241 miles. This wouild seem to indicate, as I say, that if there is any discrimination in ocean rates it is as against Vancouver on the western route. But no attempt is made by this government to take care of that situation. One more statement appears at page 26:
The effect of the administration or operation of the Atlantic steamship combine in connection with Canadian imports and exports is to almost isolate Canada from other ports of the world to which communication can only be secured by ocean route.
The extravagance of that statement needs no comment. There is one other statement which my hon. friend from Portage la Prairie (Mr. Leader) asks me to discuss, and that is the question of cattle shipments. At page 21 the Preston report states:
The tragedy of the Alberta cattle industry must be largely laid to the determination of the north Atlantic steamship combine to keep the ocean rate at an exceptionally high figure.
I suggest that the tragedy of the Alberta cattle industry must be largely attributed to the determination of the United States to enforce the Fordney McCumber tariff, and I will prove that assertion by the figures. In 1920 the number of cattle shipped to the United Kingdom was 479, the value being $70,200; to the United States in the same year there were shipped 415,956 head of cattle, the value of which was $41,226,445. In 1921 we shipped to the United Kingdom 131, the value of which was $19,350, while to the United States we shipped 221,278, the value

Ocean Shipping Rates
of which amounted to $19,759,329. This shows a shrinkage of considerably over fifty per cent in one year under the operations of that tariff. The next year, with the embargo off,- that is to say, in 1922-we shipped to the United Kingdom 35,418 head of cattle the value of which was $4,139,391 and to the United States 121,060, the value being $3,299,633. In 1923 we shipped to the United Kingdom 25,758 the value of which was $2,809,786 and to the United States 199,272 the value of which was $5,609,998. I come now to 1924, when we shipped to the United Kingdom 59,488 valued at $6,287,815 while we shipped to the United States 98,322 the value being $3,683,836.
That table will show conclusively what a remarkable business was built up in two or three years with the United Kingdom in the cattle trade. It may be quite true that improvements can be made in the matter of ocean transportation; I do not dispute that for one moment. Indeed, I hope that improvements can be brought about; and if the rates are not satisfactory now I sincerely trust they will be made so, in order that the Alberta cattle industry may prosper, as it deserves to prosper, through a substantial trade with the Mother Country. But let us bear this in mind. The British mercantile marine has rendered this country, throughout its history, signal service in building up its trade. It has carried practically all the trade of this country and made it possible for us to become the fifth or sixth greatest exporting country in the world to-day. This is due, I say, largely to the British mercantile marine. Nor can I forget that during the war it made it possible not only for agriculture but for the industries generally in Canada to expand, as they had never expanded before in the history of the country. Once more, it was the British mercantile marine that did duty for Canada when Canada had no ships and no protection for her trade routes. At that time she relied for her mercantile service upon the British mercantile marine, and for the protection of her trade routes upon the British navy. Had it not been for the export trade which Canada was able to build up with the Mother Country in those days the financial interests of this country would have been crushed, and Canada, to use a popular expression, would have gone broke. It was, I emphasize, due to the British mercantile marine and the British navy that we were able to continue our trade and to expand. Now, under these circumstances, I suggest that there is no justification for an open declaration of war on the British mercantile marine on the part of this government. The course suggested by the Dominions Royal Commission is the proper course to adopt; that is to say, there should be a conference
between the dominions and the Mother Country and if necessary joint action by all. Certainly, there should be no isolated and foolish action on our part; there should be no attempt to attack with a pea shooter as this government proposes to do by means of the Petersen contract. That is not the sort of action we want; we want action that will display some vision. And the only way we can accomplish anything satisfactory is by means of a conference between the dominions and the Mother Country, in an attempt to solve the question of the control of ocean rates. In my opinion there must be an Empire board if results are expected.
I therefore move:
That Mr. Speaker do not now leave the chair but that it be resolved: That effective control of ocean rates can be exercised only with the co-operation of all portions of the empire, and by a body on which all are represented, and the contract made by the government with Sir William Petersen, based on the report of W. T. It. Preston is ill-advised, costly and futile and unworthy of the serious consideration of this House.


Mr. W. F. MACLEAN (South York):: Mr. Speaker, I do not profess to be any Heracles, undertaking some difficult labour like that distinguished hero of Greek mythology, but I have to put my hand to something to try to clear up the situation now before the House. I am impelled to do this by reason of the proposal introduced by the Minister of Trade and Commerce (Mr. Low). I agree with a good deal of what he has said as to a shipping combine known as the North Atlantic Shipping Conference, existing, as it does, to the prejudice of Canadian farmers and shippers generally. The evidence that has been offered here is in the direction that such a combine exists. The Minister of Trade and Commerce (Mr. Low) quoted the hon. member for West York (Sir Henry Drayton), when he was head of the Board of Railway Commissioners, as encountering that combine in England. We have heard the evidence of the Masseys and many other importers and farmers in Canada who have run up against this combine. No matter what is said in the way of justification, I believe absolutely that the shippers of Canada have a grievance against the concerns that are in this combine, this "conference" as it is called .-they have a fine, mellifluous, nosegay manner of calling themselves a "conference," but it is a combine against shippers, farmers, manufacturers, indeed, against everybody in Canada who is trying to do business. There have been
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a dozen commissions investigating it, over a period of, not one year or two years but ten or fifteen years and this work still continues. Wherever you go, you hear of it.
The government has introduced a proposition to do away with it, and it may be possible for the government to do something to improve the situation. My contention, however, is that the government has not approached the problem in the right way. I am going rather out of my way, perhaps-and this is altogether on my own account-to suggest a way out of the difficulty and to start business and everything else in Canada on the up-grade again. What is my suggestion? It is this, that an effort ought to be made to incorporate the Canadian Pacific Railway and its steamship lines with the Canadian National Railways on fair terms. In that way we would start with a very high-class steamship line, with not only passenger vessels, but freight steamers and lake steamera of all kinds, and we would have something on which we could rely. That is a big proposition, but it is not an impossible one and it is one well worthy of consideration. I am not proposing anything that might be a financial failure. Everybody knows that the Canadian Pacific Railway, with its steamship lines, has been a successful proposition. It has made money from the start. It is a company that has not only a great railway doing a big business, but these steamship lines. It has a huge cash surplus and another surplus of undivided profits out of the land grants it received earlier in its career.
We have before us great problems of every kind and we are trying to solve these problems by creating new companies and making new deals and agreements with people outside this country. That has been tried long enough and we have failed. We
5 p.m. propose, however, to continue these experiments in the same direction. I venture to predict that the agreement now submitted to the House will end where the Crowsnest pass agreement ended, it will end in a dispute which will go to the Judicial Committee of the Privy Council and we shall have no relief for years. We must originate something in this country, and in doing what I suggest we shall be doing something towards clearing up the railway situation. Canada has been over-railroaded to death. We have all the roads that have been built in this country one after another for one reason or another during the past sixty or seventy years. We have had to take many of them over, and we have gone into debt in connection with the Grand Trunk, Grand Trunk Pacific, Canadian Northern and a

number of other companies. Others wish to impose themselves upon the country. The Canadian Pacific is the complement of the Canadian National if the two can be put together in some fair way. I believe that is possible and I want to suggest to the government that, instead of dealing with the Petersen syndicate, they ought to see if there is not a way of making an arrangement between the Canadian Pacific and the Canadian National to consolidate the two into one system owned absolutely by the people of Canada. As to how that is to be brought about, I am not going into details at the moment but will refer to that later on. Let me point out the immediate and absolute advantages of any such combination.
As I said, the country is over-railroaded and we want relief from that. Just to show what the extravagance has been in the past- and it has not ended-we hear that the Canadian National, the Temiskaming and Northern Ontario, a provincial road, and the Canadian Pacific are all laying plans to build lines into the new mineral country in Quebec and Ontario. One company could do all that work instead of three lines being built, and great economy could be effected thereby. There are other cases where immense savings could be made. By consolidating the two roads, you cut out all unnecessary services, and what is more important, you re-route the services on the combinations that are available. For instance, you would re-route the great freight lines across the continent and all the local services in all the provinces.
At itihe present time one road has the best grade here, the other road has the best grade there; one system has the best passes through the mountains, the other the best bridges over the rivers. But if we consolidated these lines and took advantage of the economies that come from re-routing and stopping of unnecessary rivalry, we would save millions of dollars to the people of Canada, and we would at the same time acquire a great railway service and a great steamship service; and the latter would do everything that we seek to accomplish by this contract, and moreover the ships would be absolutely our own.
But that is only a few of the economies that might be effected. How much longer can this country stand the competition that is now going on between the two great systems? I live in Toronto, I go between there and Ottawa every week, and I see the two systems competing for business that one system could handle just as well and save a great waste of money. There are three or four transcontinental trains daily that are unnecessary, probably they are losing money,

Ocean Shipping Rates
and a consolidation would put an end to that loss. As between Toronto and Montreal there is unnecessary duplication of service. The same remark applies to the local services, for example, out of Toronto, where two lines are competing for traffic that one line could handle just as well and with a great reduction in cost of operation.
My suggestion therefore is that an effort should be made to effect a combination along the lines I have stated in order to solve our transportation problems both on land and sea. And undoubtedly our ocean-borne traffic has been held back for many years and the attitude of the shipping companies is a menace to this country. Some people will ask, "Could Canada run a steamship service?" Well, I answer that the officials of the Canadian Pacific steamships, having made a great success of their business, would make an even greater success of such a consolidated steamship service as I am proposing. In a hundred other ways there could be effected great savings, to the advantage of Canada generally and to the building up of our commerce and industry. Unfortunately Canada is to-day affected by pernicious anaemia, in other words, over-railroading. But, by consolidating and developing our own steamship lines instead of attempting to make a deal with an outside shipping company we would benefit the whole country.
When I suggest consolidating the Canadian Pacific with the Canadian National, I am not proposing anything in the way of taking over a non-paying railway. The Canadian Pacific to-day is one of the most successful railways on the North American continent. It has been built up, it is true, after the granting of large 'bonuses by the government, but it is a success, and if it were incorporated with the Canadian National system, to-morrow the consolidation would improve the whole railway and economic condition of the country. A good many million dollars would be needed to finance the consolidation, but in effect it would finance itself. Some people may be alarmed at the idea of our incurring further liabilities. But they are mistaken, the consolidation I propose would carry itself albso-luely and would strengthen the railway situation. All we need is courage to go ahead. Unhappily, some people are trying to promote the idea that there should be a continuance of this unnecessary competition in railway and marine transportation. That is wrong. The consolidated railways 'and the consolidated shipping systems would be a success from the outset, and we would begin to save millions of dollars, and, furthermore, we would begin
to build up the country. But instead of taking this course it is proposed to embark on a deal with a shipping company in England over which we would have no effective control, and I fear if the contract is confirmed by parliament it will result in lawsuits and will delay the solution of the problem of ocean transportation.
I appeal to the House and to the government to see if it is noit possible to put our own railways and our own steamship lines into one consolidation. To-dlay the Canadian National railway is one of the greatest public-owned transportation systems in the world, it is rapidly growing jnto a profitable business, and it has the absolute confidence of the people to-day. That is its great merit. The one flaw in the record of the Canadian Pacific is that it is not owned by the people of Canada.. The control of it is not in Canada, it is in the investing public, who make their headquarters in London and New York, and any day that line may pass out of our hands. Now is the time to secure it. If I can read the signs of the times, and I do read some of the propaganda that I see in the pa,pern, I imagine

although of course I have no authority from the Canadian Pacific to make the statement-I imagine that that company would be prepared to enter into a reasonable arrangement for consolidation Iwith the Canadian National, especially if it imposed no real charges upon the people of this country. Such a consolidation would improve the railway service and, most important of all, the road would be absolutely the property of the Dominion. Can that consolidation be worked out? I say it can. I am quite sure that if the president of the Canadian National and the president of the Canadian Pacific sat down together they could conclude a satisfactory arrangement. Really it is very simple, for there are no financial propositions to be taken care of. Indeed, the consolidation takes care of itself, and for the first time it would take from the shouldere of the people the burden of operating lines that do not at present pay.
Some critics would of course raise objections to my proposal. I cannot help that. Let us find out if it can foe effected. When it is objected by my critics that such a consolidation cannot be effected successfully, I say that what the Canadian National and the Canadian Pacific have done as two single lines can be done even more effectively when they are combined in one great system. And the same remark applies to the steamship services, especially if supplemented by the Canadian Government Merchant Marine. "Oh,"
Ocean Shipping Rates

other critics say, "Australia has failed in its steamship venture." Perhaps it has, but perhaps it did not have the efficient management which we have and which would ensure our consolidated steamship lines being a paying proposition. My further answer to that is that we have accomplished it so far as the Canadian Pacific is concerned. They can handle a steamship line and succeed, and I am quite confident it could be successfully handled in connection with the consolidated national lines.


Harold Putnam: All government owned?


William Findlay Maclean: All government owned, absolutely. There is another criticism of this course, namely, that if we had only one road in this country we would not be able to handle the labour unions, Well, that objection disappears when you take into consideration the fact that the brotherhoods of to-day, while they do deal with two roads, are united. They will -be united, and I am confident that there will be no trouble in that connection. There has been no trouble since the Canadian Pacific achieved its success and since the Canadian National started. The result has been better service, and that would be the case under the new status.
The question may be asked:	How could
this be done-it is an enormous proposition. The common stock of the Canadian Pacific Railway Company, which is really the only thing you have to consider, is valued at about $300,000,000 and to-day it is paying ten per cent. That common stock could be changed, perhaps, into a five per cent debenture carrying no voting power, which would sell at 120 or 130 in a market like that to-day; it would be one of the great securities of the world. By proceeding in that fashion there would be no great commitment upon the country- nothing like what is involved in the proposal now before the House for the creation of a steamship service.
I want to refer to some of the advantages that would come from this consolidation. I have spoken about the unnecessary competition of two lines when one line would do. There is also the unnecessary competition in getting and retaining business. Does anybody know what the cost of the personnel to canvass for railroad freights in this country is? Has anybody any idea of the law costs in connection with two big systems, one fighting the other? Has anybody an idea of the cost of the propaganda that these two roads are now spending their money on? Practically all that would disappear under the system. Some men might be put out of employment, but these men could be taken care 
of as regards their wages and still great saving could be made. All I am urging is that the government take this into consideration; I am simply throwing out the suggestion in order that the people may be seized of the fact that it is within the realm of possibility. It would be an ultimate solution of our transportation problem both by water and by land for all time to come. Are we to continue our present foolish over-competition as between these two lines, at enormous expense? Are we to continue building unnecessary lines? I attended the conference where the proposal came up in connection with a railway outlet from the Peace river country. After a great deal of talk there, and after it had been suggested that either the Canadian Pacific or the Canadian National, or both, should build into that country, the conference at last got wise-the Minister of Railways (Mr. Graham) and the premiers of the visiting provinces who discussed the question all spoke of one thing, namely, the necessity for co-operation and the cutting down of unnecessary expense with the ultimate object of reducing freight rates and getting better service. The people are sick and tired of the unnecessary railroads we have in Canada today and of the suggestion that they are to be increased and extended for generations to come. Let us stop all that.
Many other savings could be .accomplished; I have not time to mention them now. But let me say just here that the decision of this House yesterday marks a new era in the history of our countiy. After a great deal of discussion the House of Commons decided that they would begin-and properly so- to consider the question of constitutional amendment as the right of this House. I say that was one of the most significant things that ever took place in this country, and an even more significant thing would be to decide upon the consolidation of our railway lines and the taking over of the steamship lines of the Canadian Pacific, thus not only effecting great saving of money but also increasing by three-fold the efficiency of our transportation system.
Now I want to come back to the steamship combine. I am told that my good old friend Aime Geoffrion is coming here to present the the case of the North Atlantic Shipping Conference. That "conference" is a great word. It reminds me a good deal of the evangelical attitude of men like Gladstone and John Bright in the old days when they were speaking against the opium evil. That same attitude seems to be adopted by these-I shall not call them pirates, but they are pretty nearly that if we are to believe half of what

Ocean Shipping Bates
is said about the shipping combine. Well, Mr. Geoffrion is to come here, with tall black hat, I suppose, umbrella or cane, and white spats, and he is going to tell us in the manner of some of the Englishmen: "Oh, my dear fellow, it is all in the drafting; it is not in the rates." But it is in the rates; it is in the four-ply charges that the people of Canada have to pay in connection with shipping.
I can go to history for an example of a cure for an evil like this. Oliver Cromwell three hundred years ago had under his command during the civil war in England a number of hard riding cavalry men. One day one of his fodder sergeants came to him complaining of the prices he had to pay for the hay, straw and oats which he picked up as best he could from among the dealers in England. Cromwell listened to him and said: "Go back to these men and tell them that I want my penny's worth for my penny." Now, the people of Canada who have this grievance against the shipping conference should say to them, "I want my penny's worth for my penny"-and they will get it. But they will have to get it in some better way than by making a proposition to the Petersen Company, and the way to do it is by a consolidation of the Canadian Pacific with the Canadian National, making the two the property of one company, and putting the management under the two presidents and some members associated with the two lines.


Harold Putnam: Would not that be very
long delayed?


William Findlay Maclean: No, it could be
done in three weeks; this other proposal will take three years, and we will make no headway. Speaking of how an arrangement of this kind could be worked out, I saw a rather prominent citizen of Canada not long ago who had an agreement to draw. He met the other side; they came to see him from New York, and they brought with them several geologists, lawyers and other experts. But this man said, "No; if you want to make an arrangement with me, I will sit down and draft it," and he drafted it on a single sheet of foolscap paper; and the other fellow said, "That is exactly what I want," and they sent home all the lawyers and experts of various kinds who were there to check over the agreement. I believe an agreement could be drafted between these two great railroad companies in very short order, and once the agreement was drawn up, and the property became the property of the people of Canada, afteT provision had been made for the interests of the shareholders of the Canadian Pacific, there would be no more disputes over that agreement, and no more going to 62
the courts. We have put off matters year after year; you ought to see the documents that are accumulating. We had brought down to us the other day the judgment of the Supreme Court of Canada, in the Crowsnest pass case. Do you think that is going to be settled now? No, the case is going to the Judicial Committee of the Privy Council for settlement, I suppose; and so will this Petersen agreement. But, once we had our own railroads and steamships, and the government took the responsibility of administering them, we could settle all these transportation problems, all these rate and traffic problems right here in parliament. We ought to keep the authority here. We should not have to go to the courts; we should not have to carry all these unnecessary expenses with which the country is now burdened. Not only would there be that advantage, but it would stop all this unnecessary competition, all this waste of money, and we would get a real steamship line, and get it this year.
I say that such an agreement could be closed within six weeks or three months from to-day. I got a card to-day from a prosperity league telling how to build up Canada; they have various proposals, but I say that the one thing that will do more in the way of 'bringing prosperity in this country will be to stop all this unnecessary competition between the railroads by consolidating these services. Look what you would get, for instance, by the consolidation of the telegraph and express business under one management, instead of two competing all the time for business. The competition may be good, or it may not be; but it is a great waste of money, and we cannot afford it. We must reduce these rates and get some better system. We can spend years from now on in the way we have spent them in the past. The Crowsnest pass agreement, for instance; we have not got anywhere in connection with that yet; there is still a dispute there, and there are disputes in many other directions.
There will be this objection to my proposal, that public ownership is not quite a success these days. I want to answer that, and in doing so I am going to refer to the fact that President Coolidge of the United States, in his inaugural the other day, which I read through very carefully, rather took credit to his administration and to his party that they had got rid of public ownership. Now public ownership as I know it here in Canada has proved itself, and is proving itself, a real success. Who will deny that it is a success with the Canadian National Railways? Who will deny, after the experience we have had in Ontario with public ownership of

Ocean Shipping Rates

hydro-electric power, that it has been a success? It has been a great success. Even, in the street car system in Toronto, public ownership has been a great success; and when the President of the United States actually rejoices in his party having got rid of public ownership, I want to tell him that the greatest example of public ownership in the world today, even above the railways or anything else, is the national reserve bank system of the United! States. That is an absolute public ownership proposition that Canada and Great Britain and the other countries of Europe must come to. There is nothing like the strength and the efficacy of that system, owned by the people of the United States, backed by all the gold, by all the notes, and by all the credit of the United States. That system has been the marvel of the world, and it is absolutely a public ownership proposition. It is true, I got a letter from a banker here in Canada the other day saying:	Oh, that is
really owned by the member banks. But that is not so. It is owned by the people, and it is able to finance the whole world today. It is financing the world to-day in the reparations proposition more than any other country. It does it because of the fact that it is something new, and because it is based on public ownership as against the banking systems which have existed in the past, So successful has the system been that all other countries are going to adopt it. We shall have to adopt it in this country. Its strength, as I have said, is that it is public owned; the credit of all the people of the United States is behind it, and with such a credit behind it, it is finding for all the industries, all the farmers and all the people of the United States cheaper money than there is in any other country. I am not afraid of public ownership.
While the President of the United States in his recent inaugural made this apostrophe, as he did, to the 'rights of property-and it was a great declamation in that respect-I want to say that five lines of Abraham Lincoln's Gettysburg hymn of freedom is worth ten times that apostrophe. Freedom and public rights are greater than the rights of property. I am not an enemy of property; J am not a iSoviet believer or anything of that kind; but public ownership is a new idea, and it is growing. It is the solution of the w'orld's economic problems, probably; it certainly is the solution of the World's problems in regard to financing. I am convinced more than ever that the only way out of our transportation problems is to follow up what was successfully done by the recent govern-
ment in clearing up all the transportation mess created by the Canadian Northern, the Grand Trunk Pacific, and a lot of other lines. If you do that, and bring in a good line like the Canadian Pacific, you will get in a great steamship line, and get all those (steamships within six weeks after the agreement is made. I know there are lots of difficulties that will be raised by members of this House, by the press and :by others, but I want the idea to get through the minds of the people, and I believe it will come, that this consolidation offers a real solution of our transportation problems.
I will give the government credit for trying to do something in this direction. They may succeed by this agreement with Sir William Petersen, but there are twenty millions involved in the arrangement. We do not know that it will succeed, we are almost certain that the matter wild end in litigation, and that we shall not make any real headwajr. What I am suggesting of my own volirion, as one ordinary member of this House, is to take time, and try and stop this over-competition and over-railroading, all these attempts to attain something that we do not achieve and our failure in which leaves us just as badly off as we were before.
There are hosts of propositions being made, but there has been, as yet, no earnest attempt to arrive at a real solution of the transportation problem. We are asked by the Mari-times to give them special consideration, and they certainly have a claim. There is another madness prevailing in this country, and that is that every port in Canada, whether it is on the Pacific or on the Atlantic, wants to be made an expensive terminal port at great cost to the people. Enormous proposals in this direction await the consideration of the government. We cannot carry out such extravagant projects, we have not the money to do so, and yet these projects are being pressed on our attention by the various provinces and ports interested. Let us concentrate and consolidate our energies in trying to create a first-class transportation system with no frills, no unnecessary lines, no unnecessary officials, or anything of that kind. Let us make a fair deal with the Canadian Pacific company. Let us ask them to come in and sit down with this government and earnestly discuss the best solution of this problem. If we do that I believe that for the first time in our history we shall make some headway. I am sure that the people of Canada will insist on something of that kind being done if it is at all possible. In saying that I am going to leave the question to the House.

Ocean Shipping Rates
As to the amendment proposed I want an opportunity to look into it and possibly I may extend my support to the proposition. But really I cannot see why all these unnecessary expenditures should be incurred without any real assurance that relief will come. I should feel more sanguine if the government could show that they can provide relief, and could name a probable time when it would be forthcoming, in a word if they could guarantee that really effective action would result, and that this combine would be met. X do not believe that the combine can be fought by one single proposal; it must be fought by some system of national co-operation backed by national capital. And one way to begin the encounter is to tell this combine that tlhe people want their penny's worth for their penny. They will then have a little more respect for this country and, after we have made such ^ a declaration they will doubtless be more willing to offer us reduced freight rates. But the desired result will never be achieved in the way proposed. We will never get anywhere, as far as I can see, by that method, we will only get into debt. Relief will not be brought about in that way, neither with respect to this grievance nor the many other grievances of which our people complain. I am not going to enter upon a discussion of the other questions which are associated with this problem-for example the tariff and matters of that kind. I want to get the present situation straightened out before we dissipate our energies in other directions. I want to see a consolidation of the two great railroad systems of Canada, with the betterment in railroading that comes from that consolidation, and the cutting out of unnecessary services. This will go a long way towards providing cheaper and more efficient transportation, and if we get this, improved services will follow. Then the people of this country will experience a glimmer of hope. What they want to see is some kind of a change for the better, and the ending of all this over-railroading, and over-competition. All this kind of thing must stop, and we must also stop creating more ports. I have seen elaborate plans for the creation of new seaports on the Atlantic and on the Pacific which are not needed at present, although I hope they will be established ultimately. I hope the world's business is getting better, and that there will soon be more business for our railways. One essential thing is to arouse a spirit of hope in our people. We must do that immediately. If parliament applies its energies to this great purpose I believe the sun will shine again on Canada, the outlook 62i
will brighten, and we will proceed towards a better and more successful career than we have as yet encountered in our history.


Mr. ALFRED SPEAKMAN (Red Deer):: Mr. Speaker before discussing the question which is before us I should like to say how much we in this corner of the House appreciate certain of the suggestions which emanate from the hon. member who has just taken his seat. It is a very encouraging sign, it denotes a very cheerful state of affairs, 'when the nestor of this House, the oldest member of parliament and the oldest member of the Conservative party brings forward from time to time such comprehensive ideas as he presents.
I think, Mr. Speaker, that every hon. member has a full realization of the vital import of the question now under consideration. The high cost of ocean transportation has its effect upon the export trade and upon the general business prosperity of Canada. Therefore its possible reduction is a subject of importance to the country as a whole and to each of us who sit here. To none, I think, is it of greater importance than to the hon. members with whom I am associated here and the people whom they represent. It is, I think, an incontrovertible statement of fact that, to a very great extent at least, the costs of ocean transportation rests upon and are borne by the export trade of Canada ; and that in proportion as individuals, occupations, and sections in this country contribute to our exportable surplus, in that proportion they must pay their share of the cost involved, and in that proportion are they interested in the possible solution of the problem.
Again, I think the statement will hardly be challenged that a large part of the exportable tonnage of this country originates in and comes from the agricultural sections of Canada that we in this corner of the House more particularly represent. This peculiar interest has been recognized in this House before now. Two years ago, when a special committee was appointed to consider the conditions of the agricultural industry, the question of ocean freight rates was then recognized as having a peculiar application to those conditions. A good deal of the time of that committee was spent in that investigation, in that discussion, and certain conclusions were arrived at and presented to the House in the form of a report. To those conclusions I shall refer later.
Again, during the last session of parliament when the appointment of Mr. Preston was under consideration, a number of us in this corner of the chamber dealt briefly, but I think forcibly, with one phase of the situation, the live stock industry in this country. At
9S0
Ocean Shipping Rates

that time we pointed out,-and many of those arguments have been repeated during the present session with additional arguments by the member for Portage la Prairie (Mr. Leader) - that the continued increase in transportation costs as applied to the live stock industry, has had a paralyzing and crushing effect upon that industry, and that if the industry was to survive steps- would inevitably have to be taken to deal with the situation thus created. I shall refer to that later.
As I see it, this question resolves itself into two definite parts. First of all there is the question which we must ask ourselves and answer conclusively: Is there a combine?- and when I use that word I mean it in the commonly 'accepted sense; is there a combine having for its purpose the unreasonable increase of transportation rates to an excessive height, yielding exorbitant profits, and having for its object also a discrimination as between one port and another, one country and another, as well as a restraining of legitimate trade? That is the first question which we must consider and answer. The second question is this: If these conditions are ascertained to prevail, is the method proposed by the government of dealing with the situation sound in principle and adequate in the performance of its functions?
As to the combine itself and whether it exists, this is a question which has concerned us for some time. We have had during the last few years investigation after investigation; we have gone into the subject through commissions and parliamentary 'committees, and two or three facts at least are definitely established. The first fact which can be considered as having been absolutely proved, inasmuch as the parties concerned have acknowledged it, is that a conference does exist. I am somewhat at a loss at times to say where a conference ends and a combine begins, and I find myself in the same situation as confronted us when we heard eloquent gentlemen in this House discussing the line of demarcation between a convention and a treaty. That question seemed to me, as- does this one, to be purely a matter of degree; -it is only a question of degree as to bow far the conference was in fact a conference and not a combine. The conference taken for granted, what are its legitimate objectives? It may have for its objective the stabilization of rates at a fair and equitable level. It may have for its objective the giving through co-operation of better service. In a word, it may have for its objective the improvement of service, with an increase of profit to itself without inflicting hardship on any of its patrons, by a 
system of co-operation which will eliminate unnecessary internal competition. That may be. And I do not think that any member of this House, more particularly the members in this corner of the House, who believe absolutely in -the co-operative pool system, can take exception to such a condition. I may extend the same principle -to our labour friends, who believe in labour organizations for the purpose of ensuring that labour may deal collectively and not individually with the questions confronting it. The same thing applies to our pools. All commercial pools have for their objective the stabilization of prices with an increase of profit to the members of the pool, but without increase in price to the consumer of their goods, and this by means of co-operative methods that eliminate internal competition. That is the purpose of such organizations, as I see it. So that no member in this corner of the House can very well take exception to a conference of any nature so long as its ends are legitimate. The question, however, is whether the conference in this instance operated within legitimate bounds or exceeded their rights. Here is the peculiar danger of a conference of any kind, which must be borne in mind and guarded against at all times; the same weapon and machinery which can improve a service and lower costs can also be used just as effectively for oppressing the people with whom business is done. That is what we must guard against. In the case of the pools I have mentioned, however, that danger does not at present exist, because they deal with such a small part of the world's produce that it is impossible for them to create a monopoly in that direction; and world conditions themselves would automatically prevent these organizations from assuming such an attitude.


Arthur Meighen: Does the hon. gentleman recall that the head of the largest pool, Mr. Stewart, made the claim that the control of the western crop had a measurable effect in appreciating the Canadian price and the general level of world wheat prices?


Alfred Speakman: I might point out that a government monopoly of that nature, which could enter into negotiations with a buying agency in Europe, stands in a very different position from that of a co-operative pool, which must market its goods in competition with all others.


Arthur Meighen: Will the hon. gentlemar say there is no difference between the two: Is there not now control of the western crop, which did not exist before?

Ocean Shipping Rates


Alfred Speakman: I have pointed out
that not only was there a control of the Canadian crop at that time but also a central buying agency. There were not a number of buying agencies competing with themselves for that crop, and there is the difference. However, that was rather a digression. I only wanted to use the pool as an illustration of the statement that a conference is not necessarily a menace so long as it is well regulated. The question before us now is this:	Has
that conference gone beyond its legitimate purposes?


Arthur Meighen: The hon. member has
some reasoning power and I want to follow his reasoning. Is not the point he makes against himself? With a central buying agency, and a control here of the western crop, then, unless there was collusion between the buying agency and the controlling agency here, there could be no increase in prices. But without any central buying agency, and without collusion, the control would be far more likely to increase prices.


Alfred Speakman: The right hon. gentleman would seem to suggest then, that at that time there was collusion between the buying agency in Great Britain or in Europe and the board here. In that connection I might point out this, that although Mr. Stewart is no doubt an authority, notwithstanding what he may say, popular opinion maintains that, had it not been for the board of control, prices, owing to competition, would have been higher than they were. The question as regards this conference is, as I have stated, whether it exceeded its legitimate functions. So far as we can judge-and we are judging on insufficient data-one thing stands out certain, that since the organization of that -conference the cost of the service it renders has immeasurably increased. That is a statement that cannot be challenged; it rests on no report or investigation but on facts within the knowledge of every hon. gentleman in this House as well as of every business man in the country.
At six o'clock the House took recess.
After Recess
The House resumed at eight o'clock.



PRIVATE BILLS


[Stage Direction]
The House in committee on Bill No. 13, respecting a patent of West Virginia Pulp and Paper Company.-Mr. Jacobs-Mr. Gordon in the chair.
Arthur Meighen: Will the Minister of
Agriculture (Mr. Motherwell) be good enough to explain this bill?
On section 1-extension of time for payment of fees.


Arthur Meighen: In the absence of the
sponsor of the bill or any member of the government, I move that the committee rise, report progress and ask leave to sit again.
Progress reported.



EDGEWORTH GREENE PATENT

[Stage Direction]
The House in committee on Bill No. 14, respecting a patent of Edgeworth Greene- Mr. Jacobs-Mr. Gordon in the chair.
Arthur Meighen: Has this bill been referred to committee?


The CHAIRMAN:: It has been referred to committee and been reported on.


Arthur Meighen: I make the same motion that the committee rise, report progress and ask leave to sit again.
Progress reported.



OCEAN SHIPPING RATES


[Stage Direction]
The House resumed consideration of the proposed resolution to ratify and confirm an agreement between His Majesty and Sir William Petersen, providing for the establishment of a subsidized steamship line and government control of certain ocean rates, and the proposed amendment thereto of Mr. Clark.
Alfred Speakman: When the House rose
at six o'clock, I was endeavouring to point out that, whether as the result of a combine or not, ocean rates in the last few years had risen very materially and, indeed, in many cases to an excessive height. I had also pointed out that this statement was not based upon any report of a commission, but was a matter within the personal knowledge of every member of the House and of every business interest in the country. I might point out by way of illustration one or two of the items upon which those rates have so risen. I will refer first to rates in connection with the live stock industry, not because the increase has been greater on that industry than on others, but because I am more familiar, perhaps, with the effect of the increase upon that industry. As has been pointed out, since 1913 and' 1914,i rates upon live stock carried overseas have increased from about $7.50 on an average a head to about $20 to $25 a head at the present tin?P.
Ocean Shipping Rates

It has also been pointed out on other occasions that this increase of rates has nullified, to a large extent at least, the advantages we derived from the removal of the embargo upon our cattle entering British ports. It was pointed out this afternoon by the hon. member for Burrard (Mr. Clark) that -this was a comparatively minor circumstance, that our -true market lying, in his opinion, to the south, the effect of the Fordney tariff and of the special rates imposed on our live stock by the government of the United States was infinitely greater than the effect of any increase which has taken place in the cattle rates overseas. As I said before, I am inclined to agree with that statement to a certain extent; but I should like to point out that because our market to the south has been limited by the Fordney tariff, the imposition of increased rates upon our ocean-borne cattle has become of even greater moment than it would otherwise have been; 'that, barred as we are from exporting a great number of our stock to our natural market across the line, the development of other markets has become of far greater necessity than would have been the case had that -tariff not been imposed.
I would point out, another circumstance. This question was first considered and first pronounced upon in 1911. when a move was made by the Dominion government, in furtherance of an agreement arrived at with the United States, -to bring about reciprocal trade relations between the two countries, and that had that agreement gone into effect w-e would not now be suffering to such a tremendous degree by the oppressive action of any ocean combine, if such there be.


Arthur Meighen: Would the hon. gentleman just be a little closer in his reasoning and tell us how he -comes to that conclusion?


Alfred Speakman: If the right hon. gentleman had waited I would have endeavoured to arrive at that conclusion by a logical course of reasoning.


Arthur Meighen: I will wait.


Alfred Speakman: I was stating that at
that time the sympathy now so manifest was not apparent, and that while I cannot say that the hon. member for Burrard was himself guilty, the party of which he is a member was guilty of barring us from our natural market to the south. Later the United States erected the existing tariff barrier against us.


Mr. ARTHURS:: Does the hon. gentleman say that that was in consequence of the action taken in 1911?


Alfred Speakman: If the hon. member will possess his soul in patience I shall answer a good many of these questions when I reach them in the course of my remarks without giving him the trouble of asking them now.


Arthur Meighen: We are very patient.


Mr. CRERAR:: That is a virtue.


Alfred Speakman: I pointed out that
since that time the United States had put in force a tariff against our stock which had resulted in a practical cessation of exportation to that country.


Arthur Meighen: The hon. gentleman has
missed an incident in the meantime, that after the rejection by this country of the reciprocity treaty the United States' first step was to put in a tariff on stock lower than that provided for in the treaty itself.


Alfred Speakman: I think that is a statement of fact. But it hardly alters the position which I am about to assume, which is that some years after our rejection of the reciprocity treaty the United States raised the tariff to its present height, forming an effective bar to the movement of our stock across the line. It is purely a matter of conjecture and opinion to say what would have happened had reciprocity been agreed to by Canada. The advantages of that pact may have been so apparent to the United States that they would not have raised their tariff against our cattle.


Mr. ROSS (Kingston):: When we had
reciprocity before with the United States who abrogated it?


Alfred Speakman: To what reciprocity
arrangement does the hon. gentleman refer?


Arthur Edward Ross: To the reciprocity
agreement of 1854.


Alfred Speakman: I am afraid I cannot
follow my elderly friend back seventy years.


Arthur Meighen: Just go back four years,
then, when we had reciprocity in wheat and flour; who was it cancelled that arrangement?


Alfred Speakman: The right hon. gentleman is perfectly correct in his implication. I am merely stating a fact without implication, the fact that it is a pure matter of conjecture what would have been the result in later years had that reciprocity pact- been agreed to by Canada, and pointing out that the sympathy now expressed would have been better shown at that time. I further pointed out the fact that through the action of the United States in raising the tariff against our cattle, our market overseas has become of greater importance to us than would otherwise have been the case,

Ocean Shipping Rates
and that consequently the present high rates upon our cattle overseas has become a still greater burden.
Anyone familiar with the cattle industry in western and, I think, in eastern Canada, will admit that whatever justification might be offered by the transportation companies for that increase, the fact remains that it is a crushing and paralyzing burden upon the stock raising industry of Canada, and that any effective measure tending to reduce these excessive rates will be welcomed by those engaged in the industry.


James Arthurs: Is it or is it not true that the shipping companies have reduced the rates since the United States put an embargo upon Canadian cattle?


Alfred Speakman: The rates have been reduced since they reached their peak-whether as a consequence of the Fordney tariff or not I am unable to say. On other lines which are familiar to hon. members-I am not going to burden the House with statistics now-the same course has been followed and the same effect has been produced. We have only to read the communications from manufacturing and other concerns to show that the country as a whole realizes that the export trade has been hampered and that an unjust burden has been placed upon it, and that any measure to effectively relieve the situation will be welcomed and will be in the best interests of the Dominion. These facts are so apparent that it is not necessary for me unduly to elaborate the point.
The question, to be concise, is this: whether those rates rose as a natural consequence of increasing costs or whether they were put into effect of set purpose by a combine which controlled them. That is a point that has not been brought out clearly in the report which now lies before us. We may, however, hold opinions upon it; and taking into consideration all the facts of the case-the magnitude of the increases, out of proportion to the increasing costs; the fact that through this admitted conference they had the machinery in their hands to raise the rates to excessive heights; the conclusions arrived at by the special committee on Agriculture sitting two years ago-taking all these things into consideration I can only conclude that^ the presumption is in favour of the supposition that to some extent at least a combine did have the effect of raising rates beyond a necessary limit.
May I here refer to what I consider as one of the most glaring inadequacies in the so-called Preston report? All these facts were
in the hands of hon. gentlemen; they had all been established beyond peradventure during the last year. But what we did want to know, at least what I wanted to know, was this: did the raising of these rates result in undue or exorbitant profits to the companies involved? Upon that point this report throws no light, yet it must be taken into account when any proposal to control or reduce these rates is being considered.
Another inadequacy might be shown. Statistics are placed in this report to show the discriminatory increases put in force by these shipping companies. On page 14 of the report there appears comparative table of shipping costs based upon the mileage and the tonnage. It as clear enough as far as it goes, but there are two or three factors which are essential to a proper consideration of the case but which have not been presented or even touched upon. The first is this: that while it does give a comparison by mileage and by tonnage it gives no inkling as to the class of goods involved. It might be a ton of wheat in the one case and a ton of silk in the other, for all this report shows; and unless the comparison is given between similar commodities as well as between similar tonnage and mileage, it is of no value whatever. Again, this report fails to take into account the percentage of available space occupied on each of these trips from Canadian ports to the Old Country, yet that is an essential factor in considering the costs. Again, it makes no reference to the return cargoes, another point which must be had In mind in that connection. So I think the House will agree that we should not attach too much weight to the report which is before us but that we should rather discuss the matter from the point of view of common sense and ordinary judgment, as well as of those facts which are familiar to all of us.
Having come to the conclusion, however, that excessive rates exist and that those excessive rates have been at least partly brought into being through the efforts of a combine, we come to the question of how that combine shall be controlled and how those rates shall be reduced. A suggestion is placed before us by the hon. Minister of Trade and Commerce (Mr. Low), namely, that a certain line of steamships consisting of ten vessels shall be subsidized by this country with a view to reducing rates. Now, on analysis, what does that mean? I may say in parenthesis that it is impossible to know just what it does mean in the absence of any explanation in the report of the points I have mentioned. Unless it can be shown that exorbitant profits have
9S4
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been made, of what avail is it to speak of subsidizing vessels in order to reduce the costs? We are on the horns of a dilemma in this matter. If exorbitant profits have been made, what has prevented independent steamship lines, such as the Petersen line or the tramp steamers in different parts of the world, from taking part in this trade and enjoying part of those profits?


Robert James Manion: Or the Canadian Merchant Marine from making good money?


Alfred Speakman: Yes, if exorbitant profits have been made why has the merchant marine, engaged in that traffic within the conference itself, carrying goods at conference rates, shown a deficit? Is it due to bad management on the part of the officers of the merchant marine? Is it due to some inherent incapacity on the part of the vessels themselves? Or to what is it due? It seems to me that before considering the subsidizing of any other line we should look well into the question whether the merchant marine has been employed to its utmost capacity and in the best possible manner.
I am aware that while on one side of the House the merchant marine has been extolled as a very fine fleet of vessels, modern in their specifications and well adapted to the business of ordinary freight transport, on the other side of the House the position has been taken that_ those vessels are totally unfitted for the service. Between these two varying opinions, neither backed up by any official statement on the part of Shipping experts, what are we to think? Are we to suppose that the reason that the merchant marine has not been developed to its whole capacity and has not been used as it should have been is due to a desire on the part of hon. gentlemen on the government side that no vessels built under the auspices of a Conservative government shall succeed? Is the praise bestowed upon this merchant marine by gentlemen to my right due to the fact that it was under the auspices of their government that these vessels were constructed? Or to what may these divergent opinions be due? I do not know. But I do know this: that if these vessels are at all adequate to the service they should have been used to demonstrate the actual costs of ocean transport.


Arthur Meighen: I do not want to lie under the implication of seeking undue credit. I may inform my hon. friend that hon. gentlemen opposite supported just as enthusiastically as ourselves the building of these vessels, as well as the type of vessel built.
	*


Mr. CAHILL:: Not at all. It was put
through by closure.


Alfred Speakman: I will leave that to be argued out between those on the government side and my hon. friends to my right. The fact remains that these vessels are in existence and that an honest and thorough trial should have been given them, in my opinion, to ascertain whether or not they were fitted for the service; to ascertain through their use, before a subsidy was proposed, what the actual cost of ocean transport was. And while I am speaking of the proposed subsidy, may I say this:	The people in my part of the
country have always been dubious about the granting of subsidies. We in this country have had some unhappy experiences in the granting of subsidies to private corporations or companies supposedly for the public welfare. We have found that while those subsidies were welcome and of benefit to the companies and corporations themselves, they seldom resulted in real benefit accruing to the country, and therefore, as a matter of principle, in the light of history I would be very dubious of this method.
The question then presents itself as to what effect these subsidized vessels would have upon our present situation. The proposal is that ten vessels of a modem type and of fair capacity shall be subsidized and1 used in this service, and that if this proves a success the system may be extended to include more vessels of perhaps a similar type. I want to point this out:	In the first place, unless it
is proved that exorbitant profits are made, what does this policy mean? It means that the government as a part of government policy will be going into the business of paying part of the necessary cost of transportation by subsidy derived from taxing the people. That may sound absurd, and yet it is logical. If the profits are not exorbitant, it simply means there will be no combine breaking; there can be no reduction of rates through this action, for to be effective the subsidy must be applied to all of the vessels engaged in our ocean transport, and in effect the subsidy must pay part of the necessary costs of that transport. Mr. Speaker, before we adopt such a policy I think we should consider well.
There is another point in that connection. The statement has been made, and I think it was a correct statement, that this proposal was suggested as much for the benefit of our manufacturing industries as of agriculture; that is a perfectly proper state of affairs. No one is asking for a policy which shall be of benefit to only one section of this country or to only one class in this country. But the question

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then arises, in what proportion may these various industries take advantage of these proposals? Can the cattle industry, for instance, derive any great advantage from these proposals? I do not think so, for the simple reason that the bulk of our cattle are shipped in a comparatively short season, a large portion of them being cross-fed stock, and the percentage of those cattle that could be carried on these ten vessels would thus be very, very small. So much for the cattle industry.
What about the grain industry? The amount of grain that could be carried by that number of vessels would be trifling, so trifling indeed as to be hardly worthy of consideration. And again, is grain suffering from the effects of the conference? I hardly think it is. If you take the grain rates charged on ocean transports during the last term of years, you will find that in each of those years there has been a great fluctuation as between the charges of one cargo and the charges of another. No stabilization of rates there. You will find, moreover, that the average increase since pre-war days has been comparatively small as compared with the increase in other lines of industry; and for another reason the very nature of the freight itself makes it impossible for it to be taken over by any combine. I am not relying upon the philanthropic intentions of a combine to safeguard any industry. I have not' that high opinion of our steamship companies, valuable though they may be, that is possessed by our friend from Burrard (Mr. Clark), who felt that the shipping men themselves were of such high calibre and were so patriotic in mind that they would not, even if they could, take advantage of any conference; I am not suggesting that at all. But what I am suggesting is that the very nature of the freight, the fact that in many cases it is moved out as distress or ballast cargo, the fact that it is a class of freight that appeals to and can be carried by any tramp steamer that comes along, renders it impossible for any combine limited to liner freighters to effectively control grain rates.
Then what have we left? We have dairy products, fruit products, and some smaller products, which though smaller still form a very important part ' of our ocean traffic ; and in these lines, I believe, it is quite possible that agriculture would receive its share of benefit. But I wish to point out this: One of the obvious reasons why rates are high is because we have so little return cargo; I think that is so obvious that it does not require stressing. Now why have we so little return cargo? One of the reasons is the fact that we have a tariff which places
a restriction on imports. And then what is the situation so far as our manufacturing friends are concerned? We have in this country a tariff placed there as a matter of public policy, but placed there in accordance with the wishes and desires of the manufacturers of this country, and held there because of their wishes and desires, and, as they express it, because of their interests. Through the operation of that tariff, indeed that is its purpose, the prices to the consumer at home are increased; and now we have the proposal that these same manufacturers shall receive a subsidy from the public treasury to remove from them the handicap placed there at their own request. It is a peculiar situation to my mind, and it is still more peculiar when you consider this effect; that the very same people who now pay the increased cost of goods at home will through taxation pay their share at least of that subsidy. I think it is a most peculiar situation. However, that is merely in passing. I have no intention of being diverted, as some hon. members have been diverted, into discussion of the tariff at this time, but I wished to point that out because in this connection it has a direct bearing on the question. I would also like in the same connection to point out, as has been done by other hon. gentlemen, that a logical method of increasing our return cargoes, and thereby decreasing the cost of ocean transport would be to substantially increase the British preference or to wipe out-altogether the duties against British goods. I am quite certain that in taking such action the government would find themselves supported unanimously by the members with whom I am associated.
Now what other weaknesses may be apparent in the proposal of the government?-and in discussing this question let me say that I am endeavouring at least to express opinions that are sincere opinions. I am not endeavouring to make this a political issue. There is nothing that this country would so strongly resent as to have any member of parliament or any party in this House make of this tremendous issue a political football. There is nothing that would so redound against a member or a party as such tactics. This is a business question. It is a question which affects business solely. It is a question which can only be settled satisfactorily upon absolutely business grounds, and a question which can only be settled upon business grounds when we are in receipt of the necessary information upon which to act. In speaking on this question I am endeavouring, from my point of view to impress upon this House the objections which we honestly hold. We
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have another objection to this particular method, which has been largely voiced by hon. members to our right, and it is this: That the agreement as brought down does not give adequate control on the part of this government. It does definitely stipulate what this government shall do, and what this country shall do-it definitely states what assistance shall be given by ourselves-but it does not definitely state, in my opinion, under what conditions the ships themselves must operate. For instance the contract does not state, although it may be implied, what commodities shall be carried at reduced rates. It is left to the discretion of one party or the other; it is left to the discretion of the steamship company itself or with the government. I do not consider that is a healthy state of affairs. I think if an agreement is entered into it should be made so clear and so binding, that not only are our obligations set forth but also all the obligations of the other party of the contract. It does not state, .for example, the numbers of sailings that must take place. It does not state that there must be sailings at any given intervals. It does not state how many sailings there must be in the course of a year-it simply states that so many vessels must be employed. Thus if vessels were laid up and were not giving the service the subsidy would still continue, and to my mind that is something which must be considered. We are not criticizing this method because we object to control. We are giving the government credit for having taken cognizance of the seriousness of the jituation, we are giving them credit for having brought forward some measure which would suggest relief; we are giving them that credit, but we also feel that the method suggested is inadequate.


William Lyon Mackenzie King: Would my
hon. friend suggest a better method?


Alfred Speakman: I will come to that in a moment if the Prime Minister will permit me. Therefore, what action can this House take? It seems to me, Mr. Speaker, that the only reference it logically can take is the reference to a committee. But in that connection may I point this out:	When the Minister of
Trade and Commerce (Mr. Low) made that suggestion we felt that it was a reasonable one. He suggested-and I think I can use his own words-"that it be sent to a special committee who should have the power to ask questions and make suggestions". And may I say, in passing, that asking questions and making suggestions is one of the best things we do.


Mr. SUTHERLAND:: Did the minister not state that it was a cast-iron contract which could not be changed in any particular?


Alfred Speakman: I think the hon.
gentleman is attributing the statement to the wrong minister, and is also anticipating what I am about to say. If this committee is empowered only to ask questions and make suggestions, if there is no intention of putting any of the suggestions into effect, then I say the committee would be a mere farce. And yet what are we to think? The statement was made by the Prime Minister-and I must say I listened with some apprehension to it-that this agreement must stand as it is; that it is susceptible of no trimming-to use the exact words of the right hon. gentleman. Now, Mr. Speaker we know the elasticity of the word "trimming". When your butcher trims your roast he removes any objectionable fragments. When the milliner trims a new chapeau for the madam she adds a touch here and a feather there with entrancing results. I am sorry the hon. member for Lunenburg (Mr. Duff) is not in his seat at present because I look to him for some assistance when in dteep water. I understand that in navigation you "trim your sails" thereby coming a little closer to the wind. But this agreement cannot [DOT]be trimmed.


William Lyon Mackenzie King: May I ask my hon. friend if he thinks it is a correct method to enter into a contract with other parties and make that contract subject to all kinds of change? The contract is subject to the approval or disapproval of parliament; that is the object of referring it to a committee. II the committee, after studying the contract and hearing all the circumstances, come to the conclusion that it is not in the public interest it is not only their privilege but their duty to so inform parliament and throw the contract to one side. But if, after having heard all the circumstances, they come to the conclusion that the government has acted wisely in making the contract I do not think they should find fault with the government in having first taken the only step that was possible to get a contract and to carry out the wishes of parliament.


Alfred Speakman: I hardly think the Prime Minister has quite caught my point.


William Lyon Mackenzie King: Yes, I have.


Alfred Speakman: I quite appreciate that the committee has the power to report for or against this agreement, but I appreciate also the fact that in view of the statement of the right hon. the Prime Minister the committee

9S7
Ocean Shipping Bates
has not the power to modify any of the conditions made.


William Lyon Mackenzie King: I am afraid my hon. friend does not get my point which is that the government would not have had any contract at all to place before parliament if it had adopted the method he is suggesting. There are two parties to a contract when entered into and it must be understood that if it is subject to approval there it stands. You could not get another party to enter into a contract with you and agree to carry it out, if you made it subject to alteration or change at the will of another party.


Alfred Speakman: Then I merely wish to point out this further fact: In view of that statement, in view of the fact that the committee only has the alternative of accepting or rejecting in toto the agreement as presented, then the usefulness of that committee will be very small.


William Lyon Mackenzie King: I would point
out to my hon. friend that it is quite possible that the committee might recommend certain changes. Those changes would have to be subject to the approval of both parties, but that does not prevent the committee from recommending changes if it thinks alterations should be made. What I want to make clear is this: The government could have made no contract with anyone, with no responsible person whatever, without undertaking to say that the contract if submitted for approval as it stood should not be whanged except with the consent of both parties.


Alfred Speakman: I quite appreciate that fact. I appreciate the fact that in entering into a signed contract the wishes of both parties must be considered and that no change can be made without the consent of both parties.


William Lyon Mackenzie King: That is what
I am arguing.


Alfred Speakman: I quite appreciate that fact, I appreciate also that unless the government is willing to give every consideration to any suggestion, that it is willing to withhold the contract until suggestions for modification have been made, and then enter into further negotiations on the basis of those suggestions, if thought wise by the committee, the committee can be of very little value.


William Lyon Mackenzie King: I will say at
once that the government will not only do that but will be very glad to welcome particular suggestions.


Arthur Meighen: Then the government
does not stand or fall by this contract?


William Lyon Mackenzie King: The government stands or falls by the contract most decidedly so, but the government will be quite prepared to discuss with the other party to the contract any suggestions which the committee may make, and we believe that the other party to the contract will be just as reasonable as the government when what is proposed is in the public interest.


Arthur Meighen: That is not standing or
falling by the contract.


Alfred Speakman: I must confess that the explanation of the Prime Minister has not made matters much clearer. It may be that the fault is in my mind, it may be that the obscurity is in the explanation; but I do wish to' point out that if this is introduced as a government measure, and if, as stated, the government must stand or fall by the acceptance or rejection of this agreement in its present form, then the government is not in a position to receive suggestions nor is it in the position to even discuss a modification of the agreement. As I understand it, the government's statement, by which they are prepared to stand or fall, is that you may add nothing to the agreement, take nothing from it, nor bring it any closer to the wind, so to speak. Therefore we must consider that the contract partakes of the nature of the law of the Medes and Persians which cannot be altered.


William Lyon Mackenzie King: My hon. friend is usually very reasonable in these matters and I do not think he desires to misunderstand me. In fact, our points of view are similar if not identical. This is a contract between two parties and it may not be altered except by the consent of both. The purpose of the government in referring the matter to a committee is to get the committee's approval or its disapproval of the contract. If the committee disapproves of the contract in its present form and has recommendations to make regarding it, the government will certainly consider such recommendations and will be pleased to take them up with the other party to the contract. As I have already stated, the other party to the contract, I believe, would be just as reasonable and just as desirous as the government to meet the wish of the committee with respect to any change that was thought advisable. If, however, the other party to the contract should not be agreeable to this, then it would be the duty of the government to stand by the contract in the form in which it is. But once
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the matter is brought before the committee and the committee has the fullest opportunity of considering it from all angles, there will be time enough then to consider whether or not the recommendations of the committee may be such as both parties could accept.


Alfred Speakman: As I see the situation,
then, the government will stand or fall by this agreement but they will be prepared, with the consent of the other party, to modify it upon the basis of such recommendations as may be submitted by the committee. May I say this, that the good faith of the government in this matter will be tested, first, by their willingness to refer this matter to the committee before a definite pronouncement is made in the House and before the House commits itself to the contract.


William Lyon Mackenzie King: The House cannot commit itself to the contract until all three readings have gone through. When the minister brings in the bill, it will be referred, immediately after its second reading, to a committee which will discuss it before it is brought into the House.


Alfred Speakman: A bill after it has had its second reading is accepted in principle; the principle of the bill is accepted when the House agrees to its second reading. So that parliament, having accepted the principle of the bill in this instance, the bill itself could not be subject to any severe modifications on the part of a special committee.


George Perry Graham: I would point this out
to the hon. gentleman. A railway bill, for example, gets its second reading and is referred' to a committee. That committee has the power, and often exercises it, to throw the bill out altogether.


Arthur Meighen: Does the minister know
of any railway bill or of any other bill embodying a contract, which a government has made, which has ever been altered upon a recommendation of any committee? Does he know of anything of that kind in the history of any parliament?


George Perry Graham: I have known railway
bills to be introduced into this House-


Arthur Meighen: That is not the point.


George Perry Graham: That is the point, exactly. My hon. friend is afraid because he knows that I have him absolutely in a box. A railway bill gets its second reading and is referred to a committee and time and time again the committee has made changes in such measures.
tMr. Mackenzie King.] '


Arthur Meighen: I did not say to the
contrary.


George Perry Graham: It can make changes in
a bill, and only when a bill gets its third reading is it a contract with the parliament of Canada; not before.


Arthur Meighen: Does the minister think
he has answered my question?


George Perry Graham: Certainly; my hon. friend
does not know what he is trying to get at.


Alfred Speakman: If this debate on the side is concluded I shall proceed. I simply wish to emphasize again the fact that the good faith of the government will be tested, first, by their willingness to submit the bill to a committee before this House necessarily endorses the main principle of the agreement.


Lewis Herbert Martell: Would not the principle of the bill be approved by the House, after which the bill itself would go to the committee for the purpose probably of fixing the terms based on that principle?


Alfred Speakman: In the second place, the good faith of the government in this matter will be shown by the facilities which they afford the committee to obtain all the information necessary to deal with the subject. And thirdly, the good faith of the government will be evidenced by their readiness to consider, and consider favourably, the suggestions advanced by that committee in the light of such information as it has received and after adequate discussion of the whole matter.


Mr. LAPOINTE:: Would the hon. member repeat what he defined as the first test of the good faith of the government? I did not understand it.


Alfred Speakman: Let me point out for the information of the Minister of Justice (Mr. Lapointe) just what the position is of a good many members in this House on this question, at least as I see it. We are satisfied, many of us, that through the efforts of a combine, together with natural causes, rates have increased beyond the normal and satisfactory point. Further, we are satisfied that some method must be devised of dealing with the situation and settling it. But many of us are not satisfied that this particular method which is proposed is the best that could be evolved.


Ernest Lapointe: The hon. member says that the good faith of the government will be tested by sending this bill to a special committee, without asking the House to commit itself to the principle. What does the hon. gentleman suggest? I am sure the govern-

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ment will be prepared to meet his views, and if he wants we can send the bill right away, to-night.


Alfred Speakman: I am suggesting that
this committee should be given an opportunity to receive all the information necessary-	,


Ernest Lapointe: That is the third point; but what is the first?


Alfred Speakman: I say that the committee should receive all the information necessary to come to a satisfactory conclusion on the subject; that it should have an opportunity to examine into the absolute authenticity and accuracy of the report that is before us as well as of others, in order to ascertain whether or not exorbitant profits have been made; that it should have an opportunity to consider the attitude displayed by the British parliament and such action as may be adopted by the other dominions;- in short, that it should have an opportunity to take all these things into careful consideration in deciding the best steps to be followed. And after all this was done the committee might come to the conclusion that some other method was better than the one now proposed, and might suggest it. That is what I meant when I made the first statement. If the committee is given, as far as it can be given, a free hand to suggest the alternatives which have been asked for and which I am not prepared to suggest, not having the information before me that is essential if one is to suggest anything reasonable; if the committee, I say, is given an opportunity to study the question throughly and make suggestions, even though they take some other form than the present, then I should say that this was a real test of the good faith of the government. I do not say it would be necessarily a test of the good faith of the government as applied to this particular agreement, but of the good faith of the government in endeavouring to settle the question on the best possible basis, a basis which is not political, which has nothing to do with subsidies to one man or another, which has nothing to do with friends or with favouritism, but a basis that will appeal to the business sense of the country as one calculated most effectively to reduce the cost of ocean transportation.


Ernest Lapointe: Has the hon. member
any other method to suggest than first submitting this resolution to the House? Is there any other way of bringing the matter before parliament than by introducing a resolution?


Alfred Speakman: I have no quarrel with the government on the score of introducing this resolution, if it acts on a suggestion of one of its members that the matter be referred to a committee in the form of a bill, without the House being asked to commit itself to the principle of that bill. That is a different situation.


William Lyon Mackenzie King: My hon. friend knows that bills before going to committees pass a second reading. So far as this bill is concerned, the principle is the desirability of controlling ocean rates, and that is all that the House commits itself to on the second reading. It commits itself to the desirability of controlling ocean rates, subject to the approval of parliament. When the Minister of Trade and Commerce (Mr. Low) introduced his resolution, he stated the position of the government, that as soon as the second reading of the bill was over, the government intended to refer the bill to a committee so that it might consider and discuss whether or not the proposed contract was acceptable. I think that makes the position of the government clear. I want to be perfectly fair with my hon. friend. I do not want him later, when the second reading comes along, to say that the government has broken faith. I desire to point out just this, that the government is very anxious to have the committee investigate the agreement, and it is taking the one step it thinks necessai-y to arrive at that committee stage as soon as possible.


Alfred Speakman: If I understand aright
the statement made by the Prime Minister, the principle to which the government adhere and by which they stand or fall is the principle of reducing the cost of ocean transportation by any method which will be proved to be the best method.


William Lyon Mackenzie King: I would use the word1 "control".


Alfred Speakman: Or control. The
principle to which they are committed and by which they must stand or fall is not the principle embodied in the agreement itself, but rather the principle contained in the preamble to the agreement which states that it is necessary or proper to reduce rates.


William Lyon Mackenzie King: The government has made it perfectly plain, for example, to Sir William Petersen that the contract does not go into force unless it is approved by parliament. The government might have drafted a contract and said: We will stand or fall by this contract passing, because we have pledged ourselves that it is going to pass; but that is precisely the course which we did not
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take. We were careful to tell Sir William Petersen that we knew very well that there would be gentlemen in this House who would object to any contract being formed; that the government was prepared to enter into a contract on certain conditions, but one condition was that the contract must be subject to the approval of parliament. If parliament does not approve the contract, it will not be entered into. But as regards the government being committed to a policy of desiring to control ocean rates, that is a policy to which we are committed and we think it ought to be adhered to by this House.


Mr. RYCKMAN:: Does the government approve the contract?


William Lyon Mackenzie King: The government would never have signed it if it had not approved it. We believe, when this matter is referred to the committee, that the committee will approve it also.


Arthur Meighen: But if not, the government will change it to suit the committee.


William Lyon Mackenzie King: If not, the government will do the best it can to try to bring in a measure in accordance with the general will of the House. In that respect we differ from my right hon. friend.


Alfred Speakman: The situation is considerably clarified now in this second statement-and I am sure it is a statement welcomed by many members of this House-that the policy by which the government stands or falls is not a policy of subsidizing this or any other line, but a policy of controlling by the best possible method the cost of ocean transportation; that the committee will be empowered to make suggestions and if the committee reports and suggests what, in its opinion, is a better method of controlling ocean rates, the government may then adopt the suggestion of the committee in preference to the resolution before the House, without in any way imperilling its own position.


Arthur Meighen: It will not do that.


Alfred Speakman: 
Arthur Meighen: Unenviable?


Alfred Speakman: Enviable. If he received a large bonus from the British parliament and a large subsidy from the Canadian parliament I think he would be in a very enviable position indeed. All those points must be considered by the committee and dealt with upon their merits in reaching a decision. Personally I am not unalterably opposed to this contract, if it is proved beyond peradventure or doubt that this is the only possible method, and that there is some hope of its being successful. I realize that while the principle is unsound, the cost great and the value dubious, yet sometimes desperate diseases require desperate remedies; and I
think this might be considered as falling within the class of desperate remedies.


William Lyon Mackenzie King: Would it help my hon. friend in clearing up what he has in mind if Sir William Petersen were asked to come out and appear before the committee? If so, I think we ought to send him word at once and I imagine he would be very glad to come.


Alfred Speakman: I think it would be for the committee to say what witnesses they want to call. I should think that the members of the committee would request the attendance of all witnesses whose evidence would be of any value.


William Lyon Mackenzie King: My hon. friend must realize that Sir William Petersen is a busy man, and therefore if he is to be summoned to appear before the committee I think it would be advisable to let him know immediately and ask him to arrange his plans accordingly. I am trying to oblige my hon. friend by assuring the attendance of Sir William when the committee is ready to take his evidence.


Alfred Speakman: I appreciate the kindness of the Prime Minister, but as a private member I have no authority to request that any witness be brought before the committee.


William Lyon Mackenzie King: Yes you have, as a member.


Alfred Speakman: The committee itself
must decide what witnesses it will summon to appear.


William Lyon Mackenzie King: My hon. friend as a member of this House not only has authority, he has responsibility to see that the right people do appear before the committee.


Alfred Speakman: If the Prime Minister wishes my individual Opinion, I should very much like to hear what Sir William Petersen has to say in the matter, I should also like to hear what Mr. Preston and what the representatives of the companies attacked by Mr. Preston have to say. In fine, I should like to hear both sides so that any opinion I form may be based upon as accurate a knowledge as possible of all the facts and circumstances of the case.


William Lyon Mackenzie King: I undertake to tell my hon. friend right now that the government will immediately ask Sir William Petersen to be here; it will also expect Mr. Preston to appear before the committee and the representatives of all the companies mentioned in his report.
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Alfred Speakman: 
Thomas Andrew Low: But he also said that he did
not doubt the figures of Sir William at all.


Alfred Speakman: He also stated that as far as accurate knowledge went he was dependent upon the statement issued by Sir William Petersen himself. That is one reason why I certainly would be glad to see Sir William Petersen appear before the committee to verify the statements and figures furnished* to Mr. Teakle.
I think, Mr. Speaker, I have taken up sufficient time of the House. My few remarks have not been in vain, as now we understand perhaps better than we did before the attitude of the government and what its policy is in this case.


Arthur Meighen: Could the hon. member define it in his own words?


Alfred Speakman: For the present I
shall defer my judgment on the amendment because I have not yet had time to consider it. On the resolution itself I shall also defer my judgment, because I wish to make it absolutely clear that no matter what method is adopted of bringing this subject before the committee, no vote of mine shall be interpreted as committing me to support this method of dealing with the situation. I base that statement upon the Prime Minister's explanation of the circumstances of the case. Further, I would state that in voting for this I am voting in accordance with the expressed intentions of the government to reduce or control ocean transportation rates, nothing more and nothing less, and when any method comes before this House for final ratification I shall deem myself free to vote in support of or against it as at the time my judgment shall dictate when in possession of all the facts.


William Lyon Mackenzie King: Hear, hear.


William Richard Motherwell: Mr. Speaker, although this debate has only continued into the evening of the second day, it has cleared the air considerably compared with the first day. On that occasion the official opposition had grave misgivings as to whether there was any grievance at all in respect of ocean freight rates. The hon. member for Vancouver Centre (Mr. Stevens) intimated that if there was a combine it was a very harmless one, it was not vicious at all, it was somewhat domesticated and tame. The hon. member for Centre Toronto (Mr. Bristol) had very much doubt whether there was anything wrong at all or not, so far as I could gather from his remarks. To-night the government believes, as it did then, that there is a combine, a vicious combine, and that the wray to remedy it is embodied in this resolution and bill. The official opposition also think there is a difficulty or they would not have moved their amendment. They believe there is a difficulty, but they think it can be removed in the way set out in their amendment. The last speaker, I think, is equally satisfied that there is a combine and an objectionable one. While I was just wondering at the beginning how he proposed to remedy it, I noticed before he got through that he was not satisfied with the amendment; therefore I assume that with certain reservations he is prepared to support some such form of remedy as is proposed by the government so long as he gets results. Well now, you cannot tell that until wre get

Ocean Shipping Rates
through with the committee stage. As a matter of fact the situation is so bad that the government is prepared to take chances on getting results with this remedy. Something must be done; everyone is agreed on that. People have been talking around the question for years and years and getting nowhere. Now we have a concrete proposal before the House, and like any other legislation it has to go through the various readings before it is referred to a committee. We are making no difference in this respect. There will be the first and second readings of the resolution, the first and second readings of the bill based upon the resolution, and then, in order to give everybody the fullest possible opportunity to get at the bottom of the whole subject in the clear light of open day we propose to have the matter referred to a special committee where evidence can be heard and all information brought out. This is no new method; it is done on many occasions every year. Nearly all my bills go, not to a special committee, but to the regular standing committee on Agriculture and Colonization, and the same applies to railway bills.
Let me take up some of the attacks that have been made upon the resolution. It is said that the best form of defence is attack. Well, I wish to refer, not in too aggressive a way,, to some of the attacks made by the opposition on this resolution. We will take them in the order in which they have been made by hon. gentlemen who have spoken.
The hon. member for Vancouver-Centre (Mr. Stevens) was disposed to admit there was an arrangement, there was a conference. What does "conference" mean? A getting together, an arranging of things quite comfortably and satisfactorily to the parties concerned. But somehow or other my hon. friend thought it was not a very vicious thing. Then after that there followed what I thought was a very vicious attack on Mr. Preston, as if he were on trial. Mr. Preston was delegated to inquire into this matter. This House made an inquiry into it two years ago, and the report of the House committee and that of Mr. Preston are very much alike. But for some reason the hon. member (Mr. Stevens) does not like Mr. Preston, and he confined most of his remarks to him rather than to his report. What did he say of Mr. Preston? He was narrow; he was prejudiced; he was jaundiced, and there were a lot of other adjectival appellations that I have forgotten. Anyway, according to my hon. friend he was everything but the right thing. But do you not think that if the report of Mr. Preston, a man 63
of standing and a very great deal of ability, had any really serious defects my hon. friend would have put his finger upon them? I read my hon. friend's remarks very carefully-I did not trust to my ears alone-but I could not find where he put his finger on anything. He did say that Mr. Preston was a very unreliable man to get a report from, but that is a matter of opinion. Mr. Preston's statements have been assailed also by anonymous attacks, attacks appearing in the Ottawa newspapers in the form of advertisements-at least, they were not signed by anybody. These were not on the editorial page, not even on the front editorial page-if there is such a thing, and not even in the news columns, for which responsibility is sometimes taken to some extent by the editors. These anonymous , attacks, plus those of the hon. member for Vancouver Centre are the only direct attacks that I have heard against Mr. Preston's report. Now, let us see what else there is.
My hon. friend says we need return cargoes, but he has done the very best he could to stop return cargoes by opposing the British preference. Well, we cannot get it both ways; you cannot vote against the British preference and increased inter-imperial trade and then complain about the lack of return cargoes.
Then, the hon. member interrupts my hon. colleague-Mr. Low- when he is in the midst of his very excellent address, and rather exultingly says: "Well, there are four things that are not under the combine, wheat, sugar, cattle and flour." Let me see what he did say, because it is quite interesting:
May I say to my hon. friends who are seriously interested in arriving at some proper solution of this problem, that wheat, flour, sugar and cattle have never been under the conference rates? They are not controlled by this alleged combine at all. They are excluded from it and are free from these rates.
That is an interruption by the hon. member for Vancouver Centre.


Mr. BOYS:: Will the minister kindly inform the House if that statement which he characterizes as an interruption is a correct statement?


William Richard Motherwell: Well, we may take it as a correct one, but it will be all the worse for my hon. friend if we take it that way.


William Alves Boys: Will the minister permit-


William Richard Motherwell: I would say, however, that it was not a correct statement, it was a bluff.


William Alves Boys: I may tell the minister that
I am not bluffing now, and if he will permit me I want to put the question; if not, I will

Ocean Shipping Rates

sit down. The Prime Minister (Mr. Mackenzie King) was asked that question, as also were the Minister of Trade and Commerce (Mr. Low) and the Minister of Justice (Mr. Lapointe), but no one has answered it. In all sincerity I am asking the Minister of Agriculture whether or not the statement is correct.


William Lyon Mackenzie King: What statement?


William Alves Boys: That wheat, flour, sugar and cattle were not included.


William Richard Motherwell: Was my hon. friend not in the chamber when the hon. member for Brome (Mr. McMaster) presented the evidence in the matter?


William Alves Boys: Mr. Speaker-


William Richard Motherwell: Will my hon. friend wait until I am through? He will have no doubt as to where he stands.


William Alves Boys: My hon. friend talks about
bluff and evasion; I think we are getting a little of it now. I am asking the minister to say whether these articles have been under the conference rates.


William Richard Motherwell: Sit down and give
me a chance to talk. In reality the hon. member for Vancouver Centre was not quite sure himself whether it was correct or not, because he repeats it not once, not twice, but thrice. If my hon. friend will wait I will read the question as it was put on those three occasions.


William Alves Boys: Give us the answer, that is
what we want. Do not let us have a burlesque made of this.


Mr MOTHERWELL:: I have my own
way of making my remarks.


William Alves Boys: All right; go ahead then, you are harmless.


William Richard Motherwell: The hon. member
for Vancouver Centre, putting the question again, said:
I ask the Minister of Trade and Commerce, his colleague; Am I right or am I wrong in asserting that wheat, flour, sugar and cattle are exempted from the conference rates? He can accept the advice of my hon. friend behind him. Not one of them will dispute it. They know perfectly well I am right.
Then he went on to say: "I make the statement and you can prove I am wrong." That was certainly a fallacy that I have never before heard enunciated in this House. Well, the hon. member goes at it again, and he says:
I repeat that wheat, flour, sugar and cattle are not, and never have been, included in the conference rates.

I state further that I have this from shipping authorities both in Montreal and in other sections. I am not going to go any further in regard to quotations.
He has it from those who are under suspicion. What a delightful authority that is! "I have it from the combine itself," he says. And what more need be said? He prefers to accept that evidence-until the sworn evidence is produced which was taken before the special committee of which the hon. member for Brome was the chairman. When that sworn evidence was brought down showing that all these articles except sugar were under the conference rates, then my hon. friend, with the greatest grace, crawls down and says: "T never said so." The hon. member for Brome had the sworn evidence and he was showing that the hon. member for Vancouver Centre was wrong, when that hon. gentleman interrupted him:
Mr. Stevens: Will the hon. gentleman allow me to interrupt ?
Mr. McMaster: Yes.
Mr. Stevens: The hon. member is not quite right. I said that these articles were not now and had not been for some time affected by the conference rates.
"Were not now, and had not been for some time;" that is quite a different statement altogether. He goes on:
They were at one time, because I am quite aware of the fact that the United States government interfered in regard to flour, so that my hon. friend is quite right in regard to that.
Oh yes, that is quite a different story. On three successive occasions he said they were not now and had not been under the conference rates, and then when the hon. member for Brome draws attention to the fact he was hot correct, he points out that he did not catch that right; and I want to give my hon. friend from Vancouver Centre credit, I think he thought he was telling the truth. We have never found him otherwise, but he knows when to crawl down, and that is what some people do not know.


Arthur Meighen: Might I remark it is very evident tonight this government does.


William Richard Motherwell: That is all right;
I will attend to my right hon. friend in a few minutes. Here was the evidence given:
There is no fixed rate on flour. We have what might be called a gentleman's agreement as to rates on flour.
Then we have the evidence of another gentleman by the name of Cunningham. He says there is a fixed rate on grain. So the evidence they got from the combine itself was not very reliable, and if they had got a little more information about sugar the chances are it would be under the combine too, and that is the only one left. But supposing it had been true, and they could truthfully sav

Ocean Shipping Rates
that here were three articles that were outside the combine; is not that an admission that everything else is inside? What kind of consolation would it be to shippers of thousands of other articles to know that four of them were not in the combine? Only the shippers of those four articles would care much about them; all the other articles would be under the combine. After all, there was nothing to it had it been true, which it was not, but I absolve my hon. friend from any guilty intention. Does the hon. member for South Simcoe (Mr. Boys) understand now where he gets off at?


William Alves Boys: As clear as mud.


William Richard Motherwell: We have got you on that, anyway.


William Alves Boys: You are entertaining anyhow,
nothing else.


William Richard Motherwell: Well, we have got
you on that point. Here is the next one. My hon. friend from Vancouver Centre (Mr. Stevens) said that we could not specify the commodities. Well, how many commodities are there left when you control them all? The agreement provides in paragraph (d):
That the control and regulation of the rates to be charged by the contractor shall rest with the government of Canada and that government shall fix such transportation rates on all commodities from time to time.
Now how many do you leave when you get them all fixed? The opposition must be up against it very badly for argument when they think there is something left after you include them all. They are up against it pretty badly. Everybody has been commenting on the weakness and feebleness of their attack; it is lamentable, it is pathetic. After all the bluster and braggadocio and filibustering they have done, that is the sole result after the attack by one of their best mien- because he is one of the best of them over there, and that is saying a good deal because there are some good debaters over there.
Another complaint was that we could not send any of these ships to the Pacific coast. If that were true that would b;e a real grievance, because I think Vancouver is one of the most promising ports in Canada. But what does the agreement provide? Paragraph (a) provides that the contractor shall:
Build, equip, provide, establish and during this contract, continue and in the manner hereinafter mentioned, operate a regular shipping service between such ports in Great Britain or Ireland or the continent of Europe, and Canadian ports as may be designated by the Minister of Trade and Commerce for Canada or his representatives from time to time.
Canadian ports-that means all. Again, how many are left when you include them all? That includes Vancouver, Prince Rupert, the ports on Hudson bay, if you like, St. John and Halifax, Montreal and Quebec, and any others there are. Why it is a barn door; how much wider does my hon. friend want it? It must be a pretty watertight contract when that is the weakest spot they can pick on.
Another point made by hon. gentlemen opposite w'as that this contract may be abandoned over night; but the hon. member for Centre Toronto (Mr. Bristol) thought the contract was so good that if it was his he would stick to it all his life. Now what are you going to make out of that? It cannot be good and bad at the same time. I want to say that the hon. member for Centre Toronto made some of the most pertinent and I think some of the most effective remarks regarding the contract and the way it would work out, provided we went the wrong way about of putting it into effect, that is, if we attempted to put a low rate on everything and act as if we did not know which side of our bread the butter was on. The hon. member made some very sensible remarks in connection with that contingency, which we do not intend to run the risk of; no sensible person would. Let us see what he said besides,-and this shows the bent of the Tory mind on the control of rates. The hon. member for Centre Toronto takes the ground that after all, we are all liable to error, and that if this rate-fixing institution called a combine has made a mistake here and there, it is only what the railway commission has done. Now what do you know of that, Mr. Speaker. If they made a mistake, it is only what the railway commission has done, and they should be given the same fair consideration. He puts this rate-controlling institution known as the combine, which this gentleman recognized as a regular institution apparently with somebody in authority, on a parity with the railway commission. He says:
They should be given the same fair consideration which the railway commission gives the two railways of this country in the matter of fixing rates for their traffic.
The right hon. leader of the opposition never misses an opportunity to castigate the Minister of Agriculture for some alleged statement he made regarding the railway commission. That was when I was a private member. Of course, I had no right to say anything against the railway commission then, but I said it just the same. Now here is someone quite a little closer to my right hon. friend than the Minister of Agriculture, and he brackets
Ocean Shipping Rates

this institution called a combine with the railway commission. I would refer the right hon. gentleman to his recalcitrant follower to see if he cannot fix him up, and I wish him more success than he had with the Minister of Agriculture. Mark you, that was no slip of the tongue by the hon. member for Centre Toronto. He said the same thing more than once. It just showed the natural bent of the Tory mind. He said:
First of all, I do not believe there is a combine in the sense that it is a combine to restrain trade.
He also thinks it is a docile institution with no teeth, and that if it had teeth, it would not bite anyhow. He goes on:
I have too high an opinion of the Canadian Pacific and of these other lines to believe they are doing anything more than trying to get a fair rate which would keep them going. There may be mistakes made, just as there have been in the fixing of rates on our transportation lines in this country: there is a little one, for instance, on the Crowsnest pass.
Who made that mistake, if it was a mistake? The Parliament of Canada. And this rate fixing institution, known as the combine, has the same right to make mistakes that we have. What do you know about that? Well, words fail me, Mr. Speaker, to do justice to such a statement as that. I will not read any further. My hon. friends opposite are looking nearly as serious as when these files of earlier correspondence were tabled; they are looking as though their last hour had come. "Cheer up, the worst is yet to come." I think I have got through with the hon. member for Centre Toronto (Mr. Bristol).
I come now to the first gentleman who spoke to-day, the hon. member for Burrard (Mr. Clark). His first complaint was a very terrible one. "Why, these boats may be built in Germany." I suppose he thought that would arouse everybody's anger. He must have thought that we were in the middle of the war again. Let me tell the hon. gentleman the war has been over for some time. However, he made the statement twice, and I suppose he will go on repeating it all over Canada trying to make capital because these vessels might be built in Germany. As it happens they will not be built in Germany. My information is that all these contracts have been already let to British shipyards. That should satisfy my hon. friend; I hope he will sleep tonight when he knows that.


William Alves Boys: Have the contracts been signed?


William Richard Motherwell: That is for Sir
William Petersen to say; we are not building them.


Arthur Meighen: You said they were a
moment ago.


William Richard Motherwell: Another fallacious
notion my hon. friend is getting into his head is that we are going in for building ships, we have got about enough ships now of the kind that were built by my hon. friends opposite.


Mr. CHAPLIN:: You are only subsidizing
them?


William Richard Motherwell: We are paying for
the right to control the transportation rates, and we are going to control them.
Then my hon. friend (Mr. Clark) goes further with regard to wheat shipped to Montreal. He stated that these ships are actually going to haul American wheat in competition with ours, and notwithstanding that fact they are going to be subsidized out of the treasury of Canada, and then he asked the question "Is this wheat of ours going in there with the American wheat? That in order to draw our wheat they must draw American wheat and it will be mixed together in the same bin." My hon. friend is a legal gentleman, I understand that is his profession, and he must know that every article that enters Canada that is dutiable must either pay duty or go into a bonded warehouse of some kind. If he does not know that he is not very well posted on wheat; he may be a good lawyer in other respects. But any dutiable article that comes into Canada, which is just moving through Canada, enters at one point and goes out at another.


John Arthur Clark: Will that wheat definitely
go into elevators at Montreal?


William Richard Motherwell: Just a little louder
if you please.


John Arthur Clark: Will the wheat that comes
through from the United States in bond definitely get into the elevators at Montreal?


William Richard Motherwell: Surely but it will
be kept separate in special bins. Surely my hon. friend has heard of that before?


John Arthur Clark: It will be separated from
the Canadian wheat?


William Richard Motherwell: Surely.


John Arthur Clark: And never mixed at any
time?


William Richard Motherwell: 
Alfred Speakman: The hon. member for
Red Deer would be quite satisfied if he learned the profits made in the Canadian trade.


William Richard Motherwell: It is a different
thing getting information at home; but this concern is operating in another country. I do not know that Mr. Preston could get the information unless he was equipped with judicial authority; he certainly could not get it except in a voluntary way in another country.
Then it is suggested that the Canadian merchant marine should be tried out. But we have given it a critical trial, and those who have tried the merchant marine most think the least of it. The objection is raised that most of those ships are too small for ocean traffic and too big for the canals. That is the trouble. They were made for war purposes, and the war is over as I have already indicated. Now we have to use this merchant marine for peace purposes. I think the Canadian merchant marine could be made an auxiliary to the Petersen fleet of ten ships if necessary. The offer has been made to all and sundry of Canadian ships, both the Canadian merchant marine and the Canadian Pacific.


Arthur Meighen: WThat offer? Will the minister answer?


William Richard Motherwell: The contract. My right hon. friend apparently has not awakened to the fact that we are discussing a contract. I can understand the dilemma which my hon. friend from Red Deer is in to-night. He felt the awkwardness of making the choice between this ridiculous amendment, and submitting
Ocean Shipping Rates

the contract to the committee. That is the custom; the second reading is had and then amendments are suggested. And very often owing to the number of amendments that are introduced bills have to be reprinted. But as the Prime Minister (Mr. Mackenzie King) has indicated, whatever alterations are made must be such as both parties can agree to; otherwise there is no contract. We are following in this case the method that is pursued in connection with any other bill. The friends of the combine have instilled into the minds of some people the idea that an attempt is being made to do something underhand. That is absolutely not so; our desire is to have everybody on the face of the earth who wants to be heard given an opportunity to come before the committee. There is no juggling whatever; everything is absolutely straight and above board. But it is a strange fact, Mr. Speaker, that the most straightforward people are sometimes the most suspected.
I think I have dealt with most of the remarks of one kind and another that have been made by those who have attacked the agreement. And those attacks were very feeble indeed. Most of the criticism has been directed against Mr. Preston. But suppose hon. gentlemen could succeed in annihilating Mr. Preston, what would be the situation then? Why, the contract would still be there. And Mr. Preston, I fancy, can look after himself before the committee.
Now I shall refer as briefly as possible to some points with regard to the defence which has been made in behalf of the combine. Of course, we are all agreed that there is a combine; there is no reason why we should spend any time labouring that point. But I did not suspect that we should all come to that agreement so quickly. I have therefore taken the trouble to look up the repAy of the steamship companies in which it is contended that no combine exists but that there is just a friendly little get-together. I shall read briefly from this document, which by the way is unsigned. No one has undertaken to put his name to this reply, but I may say that at least Mr. Preston put his name to his own report. That is more than has yet been done by any of those who have come to the defence of the combine, and it is worth something at any rate. The extract from which I am about to read is interesting; it is what convinced the hon. member for Vancouver Centre (Mr. Stevens) that there was no combine.
As mentioned previously in this report there is no "combine" (which in the present day acceptation of the term implies a monopoly), but merely an association of the regular lines, constituting a very small portion of the carriers on the Atlantic, who have agreed
(Mr. Motherwell.]
among themselves to quote on various commodities equivalent, rates subject to change on notice; the object of this is simply to prevent the complete demoralization in rates which occurs when there is no such agreement under the keenly competitive conditions which prevail in the north Atlantic trade.
You see, the idea is to keep down competition. W'hen you are anxious that a certain rate shall prevail you naturally do not want some other fellow to come along and vulgarly cut it down. To proceed:
It is practically the same arrangement which obtains as between all large distributors of staple commodities, with the same object, i.e., to prevent uncontrolled price cutting, which, as it destroys proper service, in the end benefits no one. If it were not possible to maintain ocean rates on a reasonable basis of freight the result could only be the elimination of all but the strongest lines and a practical monopoly of the traffic bv such lines.
This is so familiar! You can read it in the dark, and it is the kind of thing we have all heard as long as we can remember. It is the old contention, that if you do not control the competition you are going to wipe out everybody and that finally you will have to resort to the sailing vessels of old, and all that sort of thing. There are two or three other gems which I should like to read if I could find them. It would be too bad to miss them, for they are well worth reading, as a defence of the combine. I thought I had turned down the places in which I marked them, but evidently they are so ashamed of themselves that they got under cover. But they are all unsigned; no one has ventured to put his name to the document. Well, of what value is a document of this character to which there is no signature? What kind of
10 p.m. campaign do they conduct when they refuse to come out in the open with the name of a responsible person? I would ask hon. gentlemen, how many men do they think will fall over one another in their endeavour to secure a hearing before the committee? They are making much ado about a supposed grievance, but if I were a betting man I would take odds on the number of these gentlemen who will cross the Atlantic to expose Mr. Preston. I can scarcely see them tumbling over one another in the corridors of the Parliament Buildings to get to the committee. But, as I say, if they cannot put their name to an ordinary document like this published in a newspaper, it is not to be expected that they (will submit themselves to the searching light df cross-examination. If they come, however, I will welcome them; possibly we will- give them a banquet.


Mr. LADNER:: 
William Richard Motherwell: But they are not
signed.


Leon Johnson Ladner: The companies have signed the document.


William Richard Motherwell: Will any of these
people come forward and assume responsibility for what is stated in the document?


Leon Johnson Ladner: But here are their signatures.


William Richard Motherwell: Those are merely
the names of companies. Does the hon. member think that Mr. Beatty, for example, will hold himself responsible for this document,
which he did not sign?
Mr. LADNER. The minister has been joking all the evening; but seriously, does he suggest that the signatures here, purporting to be genuine, are forgeries, without the authority of any individual company in any case?


William Richard Motherwell: There are no signatures there at all. I think my hon. friend's law needs brushing up a bit.


Leon Johnson Ladner: Are these not copies of
documents properly signed?


William Richard Motherwell: There is not a
signature there at all, but just the names of companies. If that is all my hon. friend has to say I will proceed. Here is another extract:
In fact the struggle became so keen that many of the lines had to withdraw, and the remainder, with a view of self-preservation, began to draw together so as to avoid bankruptcy and disaster by coming to a mutual agreement with shippers.
I wonder how many hon. members who are farmers ever heard of this combine sitting in with them and deciding on any rate. I will tell you of a case in which they did, but it was only after a club had been held over them. In the Annapolis valley some time about 1920 or 1921 it was costing the fruit growers $2.50 per barrel to ship their apples to the Old Country, as against a previous rate of 70 cents. The United Fruit Growers of Nova Scotia got after the combine and they soon made them come to terms. The apple growers got hold of tramp steamers, and while these vessels did not give them the service they wanted they were able nevertheless to cut into the apple rate to $2.00, $1.75, $1.50, until the combine came to them and said that
if the apple growers would guarantee their ships all their apples they would reduce the rate to 90 cents per barrel. And that bargain still stands. They sat in delightfully that time, but they sat in when they were simply compelled to. And that is a fact; the ship owners will sit in with the shippers, but only after the shippers have indicated quite plainly that there is going to be competition with a consequent control of rates. I have that information from the apple growers' association, whose representatives were here last week fighting another combine, which was exposed by the Minister of Labour (Mr. Murdock) and his commission. Here is another extract:
The North Atlantic steamship conference is not in any sense a combine-
That is where my hon. friend got his authority.
-but the interests of the large number of individual companies operating steamers from north Atlantic ports required some form of joint action in respect to rates. It may be here stated that the United Kingdom conference does not direct or in any way interfere with the making of eastbound rates by the north Atlantic freight conference, the rates being made to equitably permit steamers to pay expenses and the manufacturer to export.
Furthermore, in the list of eastbound rates promulgated by the north Atlantic conference, no rate or agreement is made in respect to grain, flour or cattle.
Even the hon. member for Vancouver Centre (Mr. Stevens) has gone back on that authority, so I will not refer to it any further. This is the defence. Why, it is an admission of guilt except as to four articles, three of which have been proven under oath to be under the combine, leaving only one article, sugar, and the chances are that it is under the combine also if the facts could be arrived at.


Mr. CHURCH:: Is there any reference in the Reply of Steamship Lines to the Preston report which the minister is! quoting from in reference to the elevator combine, the grain growers' trust or the wheat pool trust, and would the minister approve the subsidy policy of government aid to a few private concerns or private companies with a view of breaking up these combines and checking rates?


William Richard Motherwell: It is only ten
o'clock, and if my hon. friend will keep quiet long enough, I shall get around to the elevator combine, how it is controlled and who controls it.
Why have ocean rates increased so much? Let me make some comparisons. Have ocean rates increased more rapidly than land rates? That, at least, will guide us in coming to a conclusion whether there is anything in this
Ocean Shipping Rates

or not. The argument is advanced that transportation on the ocean is higher than it used to be. That is true, but in my estimation it is much more expensive relatively than on land. This is a table I have compiled in regard to butter, cheese, bacon and cattle, showing the pre-war ocean rates for ordinary and refrigerator stowage, the 1924 rates and the proportion and percentage of increase for 1924 as compared with the pre-war rate:
	Pre-war 1914		1924				
	Ordinary	Refrig.	Ordinary	Refrig.	Ordinary		Refrigerator
	per 100 lbs Per 100 lbs					Percentage	
Product	Cts.	Cts.	Proportion	Increase	Proportion PercentageButter.. ..	37.17	54.17	100	165	1 : 2.69	169%	1 : 3.0 204%Cheese.. ..	31.5	40.0	70	105	1 : 2.22	122%	1 : 2.6 162%Bacon.. ..	23.77	35.3	50	100	1 : 2.1	110%	1 : 2.83 183%Cattle.. ..	$7.30 each	$20 each	1 : 2.74	174%	
What are the increases on land? The average increase on land, according to a computation of many articles, is about 30 per cent. Some computators make it more nearly 40 per cent. Supposing we make it 40 per cent, there would still be an increase of 300 per cent more on water than on land. That is to say, the rates on water have increased over 300 per cent more than rates on land.


Mr. TOLMIE:: What year did the hon. member say that the rate on cattle was $7.30 a head?


William Richard Motherwell: The year 1914. I have figured this out carefully and this is tie conclusion from this schedule. The average percentage of increase, 1914 to 1924, is 143 per cent for ordinary stowage and 183 per cent for refrigerator stowage. The average percentage qf increase, 1914 to 1924, for ordinary and refrigerator stowage, is 160 per cent. The approximate percentage of increase in railway rates between 1914 and 1924 on the same commodities is 30 per cent. Taking 30 per cent as the average increase in railway rates, ocean rates have increased exactly five and one-half times as much as railway rates. That is, uncontrolled ocean rates have increased 435 per cent more than controlled railway rates in the ten year period 1914 to 1924. In face of that, we need not doubt any longer the existence of a combine on the ocean. Where the rates are controlled on land and there is the expense of keeping up the right of way with large labour bills as compared with those for ocean transportation, it seems to me the expenses must be greater on land, and yet the increase at most is not over 40 per cent as against 160 and 180 per cent that I have spoken of for ocean transportation. The uncontrollable ocean rate has increased five and one-half times as much as the controlled rates on land. Surely it is high time that we looked into these things and we are not the first to look into them. Long ago, the entire official opposi-
tinn were cognizant of all these things. May I read some of the correspondence that was brought down yesterday?
Sir George Perley reviews the history of the government's efforts in this matter. He starts out: "You will remember that during the past ten years the question of ocean freight rates has been discussed many times, as they often seemed higher than was reasonable, and some of us thought that a way might be found for controlling them by a body similar to our Railway Commission."
This is a cable Sir Thomas White sent tc the High Commissioner in April, 1919:
In that month it will be recalled Sir Robert Borden was attending the Peace conference in Paris and Sir Thomas White was the Acting Prime Minister. Sir Thomas cabled to the High Commissioner as follows: "Canada much concerned about ocean freight rates- Inquire and cable whether British government would co-operate with Canada in giving effect to report of Royal Commission on Natural Resources. Trade and Legislation of certain portions empire as presented to Imperial parliament in March 1917. This report finds that it is not desirable that operations of steamship companies carrying passengers and freight between Canada and England should remain longer, without government supervision."
Then, later on:
Sir Robert Borden, however, had been considering the question and about this time drew up a memorandum "respecting necessary control of ocean rates and disposition of available shipping."
Further on:
Government Strongly Impressed
He then says: "The government of Canada is strongly impressed with the view that this condition is not sound; that the policy and methods hitherto pursued have not been characterized in some respects by wise or comprehensive outlook, and that the future relations of the British Empire depend very materially upon the immediate remedy of existing conditions."
Think of it. Here are four kniglhted gentlemen hovening around this question, but taking care not to singe their wings in any way. Yet they feel the empire trembling! Think of that from a Tory! These four knighted, belted gentlemen, going to look into this question, and then with a combine in their centre playing the old-fashioned school game, "ring-around-a-rosy." They give a squint at it, they all admit the situation, but they

Ocean Shipping Rates
never get to grips with it. And look at them to-night! Then later on let us see what the right bon. leader of the opposition had to say:
He writes: "You will observe that the Canadian government have attached great importance to the desirability of securing, if feasible, some control of ocean freight rates." Continuing, he remarks that the Imperial Shipping Committee hitherto had not considered this angle of the problem.
"However," he wrote, "the government have now decided that the time is opportune to put before the committee this question of the control of ocean freight rates."
And in the meantime the right hon. leader of the opposition asked Dr. Magill to report on the situation; but Dr. Magill says his hands are full with another commission appointed by the right hon. leader of the opposition, the Hyndman Grain Commission, and that he cannot take care of it. As a matter of fact, they did not take care of either of them. That is a habit the old government got into. They twit us about appointing commissions, but as far as I recall we generally get reports from them. On the other hand, three at least of the commissions appointed by the old government failed to make any report. There was one-I forget its name, it was as long as the official name of the late government, and the hon. member for Moose Jaw (Mr. Hopkins) was a member of it-you cannot find it anywhere. It never reported, it simply died on the roost over night. Then we had two more. I wonder why the right hon. leader of the opposition did not write Dr. Magill to find out why he could not report. Dr. Magill just wrote back intimating that there was another commission to be attended to around the grain exchange. That is all. I think I have the key to the difficulty. There was at that time another combine forming in Canada, a combine of the people to get rid of that government, so no wonder they had not time to wait for reports from the Hyndman commission on grain or this commission on freight rates-they had to look after themselves.
It is sometimes asked, Mr. Speaker, how we are going to bring about control of ocean freight rates. If we go about it the wrong way there is bound to be failure. But why should we? I have a summary of all the sailings from Montreal during seven months of last summer for cheese, eggs, butter, meats, lard, fruit-191 sailings in all. My dairy commissioner and my deputy have worked this out carefully, and during the seven months covered in this summary the ten Petersen ships, if they have the ordinary cold storage space which I understand they will have, that is, an average of 50.000 to 55,000 cubic feet each, they will be able to take care of
ull these commodities that are offered, and use only one-tenth of the space. That is worth something. The freight rate on cheese, we will say, is lowered 15 or 20 per cent, or even 10 per cent, and eggs, butter, meats and fruit also benefiting to the same extent-will not that be worth something? These ten ships with five or six of the Canadian Government Merchant Marine will take care of the entire offerings of all these commodities from Montreal for the seven months; then they will be able during the winter months to take care of the offerings from our other ports. If we take on some of the other Canadian Government Merchant Marine boats-and I understand there are a number of them trading already on the Pacific through the Panama canal-we will have still more freight accommodation. Then there are the boats belonging to the Canadian Pacific Railway Company. You cannot expect them to come in at this time. They are a member of the combine, and they will be loyal to it so long as business considerations permit, but when the time comes to make a choice between loyalty to the combine and loyalty to the people of Canada they will not hesitate. This is a free country, the offer is free, and we do not expect the other shipping companies to tumble over each other to take advantage of this arrangement, but the more we get in the quicker the remedy will be effected; the slower they come in and the more opposition we encounter, the slower will be the remedy, and those who obstruct will have to take the responsibility of results coming thus slowly. These will be the factors determining the people's attitude on this matter.
I have every sympathy with my hon. friends of the Progressive party. But they are suspicious. There is no question about that. I do not know what they are suspicious of. Let me recite right now the struggle connected with the breaking of the grain combine in the west, and I am glad the hon. member for Marquette (Mr. Crerar) is present; he will probably confirm what I say.


Thomas Alexander Crerar: I do not know.


William Richard Motherwell: When a handful of farmers in the northwest stood out to fight the grain combine they had even a more feeble weapon in their hands than what this Petersen fleet is alleged to be. The hon. member for Vancouver Centre (Mr. Stevens) ridiculed this feeble weapon. Our farmers of the northwest wTere apparently in an absolutely hopeless position, but they had to do something, and they went out and did it. A handful of men gathered at Indian Head in 1901, and
Ocean Shipping Rates

formed the Saskatchewan Grain Growers' Association. Some time later on Mr. E. A. Partridge and three or four others formed the organization to fight the elevator combine. Why, it looked preposterous to attempt such a fight, but they stuck at it year after year, they started a journal of their own, they established locals here and there, until they had developed a spirit of co-operation and loyalty. Then a little later on in Saskatchewan there grew up another big institution under the support of the Saskatchewan government. That was in 1909 or 1910, and we do not hear to-day, Mr. Speaker, anything about a combine there. That teaches us not to despise the day of small things. These organizations at their inception were much smaller than the despised ten ships of the Petersen fleet and our own merchant marine. What surprised us the other day was when we h'ad before us Mr. Maharg, a former member of this House and later a member of the Saskatchewan government, who expressed far more suspicion with respect to this matter than the hon. member for Red Deer (Mr. Speakman) expressed this evening. Mr. Maharg enunciated the somewhat heretical doctrine preached by my hon. friend from Vancouver Centre:	You are to be judged
guilty until you prove yourself innocent. That coming from a gentleman whose company was subsidized from its inception, and rightly so, for it would never have opened its doors if it had not been so assisted, rather surprised us. The Saskatchewan Co-operative Elevator Company was started with a $6,000 organization grant. I was a member of the Saskatchewan government at the time, and know the facts. I believed it was a good policy then, and I believe so still. Eighty-five per cent of the total capital expenditure necessary to build a line of 400 elevators-$4,000,'-000-was loaned by the Saskatchewan government to this company, of which Mr. Maharg is the president. They got that money at an average rate of 5J per cent,-2^ per cent less than the current rate of interest at that time, representing a saving of $750,000. That is the gentleman who objects to subsidies!


Milton Neil Campbell: Does not the minister draw a distinction between a subsidy and a loan which has to be repaid?


William Richard Motherwell: I thought I had
touched on that, but I will touch on it further. It was a loan at 2J per cent less than they could get it anywhere else. Therefore the $750,000 saved was a subsidy, a grant, or

whatever you like to call it. It was straight aid.


John Evans: I would like to ask the
minister-


William Richard Motherwell: Now, just a minute. I know that some of my hon. friends do not like to hear this, but the same men from Saskatchewan know it. is true and they do net object to having it recited. They know that Mr. Maharg was inconsistent. They got a straight subsidy in the form of an interest saving of $750,000, and in addition to that their trading account was guaranteed 100 per cent by the government, and that ran into tens of thousands each year. In this way they were assisted in getting their loans through at the bank. Now, you may not want to call that a subsidy, but I do not care what you call it; it is money, it is assistance.


John Evans: Will the minister say that
5-1 per cent was less than it cost the government?


William Richard Motherwell: No, I do not say
that. I said it was the average price. I suppose the government could get it at that price or perhaps at a little less, but that is not the point. The point is what the elevator company would have had to pay if they had borrowed in the ordinary course of business and if the government had not taken the action it did. That is the point-and the difference is the subsidy. You cannot wiggle away from that. You cannot take the ground that a subsidy is all right for me but all wrong for the other fellow. You cannot say: "Do not do as I do, but as I tell you."


John Evans: There was no subsidy given; it was only an organization grant.


William Richard Motherwell: Will the hon.
gentleman tell me where he could get the money at 5J per cent?


John Evans: From the government.


William Richard Motherwell: I say there was a
saving in interest of $750,000 by actual computation. I do not know how much the saving on the trading account would be, but it must have run up just as high as the other because they had the government behind them and therefore the banks would make loans at a more favourable rate, knowing that they were taking no chances. The benefit in respect to the trading account ceased only two or three years ago. Now, I was jointly responsible for that, and we thought it was good business. The purpose of this payment is identically the same, that of breaking a combine, and of assisting not only the farmers

Ocean Shipping Rates
but every -citizen of the country. If that were not the object we would not be in it; why should we be? The other day a fruit combine was unearthed by Commissioner Duncan-and I may say in passing that you will live a long while before you will find the Tory party digging into a combine. Oh no; they would rather snuggle up to it. I had) an opportunity of discussing this fruit combine with my colleague the Minister of Labour (Mr. Murdock) and he indicated in a general way what was coming. Before the report was tabled or even printed we were taking action to meet the situation. Representatives of the fruit and vegetable trade all over Canada were convened in Ottawa, working out a policy to combat that combine through -the establishment of a nation-wide brokerage agency of their own. You never heard of anything like that under a Tory government. Look at the story of it! I have here a report on ocean freight rates by the present hon. member for West York (Sir Henry Drayton)-one of the knighted gentlemen who were looking into this matter. He never got close enough to it, however, to hurt either it or himself. I see that my hon. friend is just coming into the chamber, and I am glad, I ventured the prediction a while ago that he would not speak on this question, and I am going to keep to that guess. Now, this is a report by H. L. Drayton. K.C.-I assume that is my hon. friend-printed by the Government Printing Bureau at Ottawa. There is nothing wrong in it, and from what my hon. friend says in this report I am sure he can conscientiously support this resolution. He says:
With this end in view, I endeavoured to obtain the appointment of -a joint commission to make a thorough and complete investigation of, and to report on the methods and practices, and rates and charges of ocean carriers doing business, or from time to time doing business, between ports in the United Kingdom, or any of them, and ports in the Dominion of Canada, or any of them; and also of all terminal companies or port authorities of any port in the United Kingdom or in the Dominion of Canada through which traffic, whether of passengers or freight, between the United Kingdom and the Dominion of Canada passes, and also to investigate into and report on all insurance charges or other expenses that shippers from the United Kingdom to Canada, or vice versa, are subject to as the case may be.
I further represented that the commission, in addition to reporting its findings in the above matters, should also recommend what, if any, legislation the commission deemed advisable should be passed by the Imperial parliament, or by the parliament of the Dominion, or by both.
He suggests the advisability of legislation. Well, we have legislation before us. My hon. friends opposite promise or suggest, while we perform-that is the difference. I quote further:
I further represented that it was necessary that the commission should ihave authority to sit at such places it might desire, either in the United Kingdom or in the Dominion of Canada, with authority to compel the attendance of witnesses, production of documents, books, papers, etc., and to administer oaths; and also that the commission should have the right to employ accountants, etc.
We did that two years ago before what was called the McMaster committee. The inquiry went on for weeks-I do not know how long; we thought it was going to drain the treasury to pay the expenses of the witnesses. That committee submitted three or four interim reports. The hon. member for West York, in this report, suggested investigation either in Great Britain or in Canada. We have had it in Canada, and in a week or two we will call to this country everybody in England who wants to come and attend the hearing before the special committee. In his report the hon. member for West York also said:
I further impressed upon the Imperial authorities that it was the desire of the Canadian government that the investigation should be entered on in the near future, and, if possible, a report made so as to enable any necessary action to be taken by that government at the ensuing session of parliament.
He suggested that steps should be taken to make action possible "at the ensuing session of parliament." This was in 1913; so that the hon. member had in mind exactly what we are doing. I do not know how he can object to our legislation, unless it be from the point of view of party loyalty. I have a high regard for that myself, and that would be the only justification for taking a stand against the report. However, I will not take any delight in seeing my hon. friend try to look both ways, beeause we all have to do it sometimes; in this team work we are engaged in it cannot be avoided. But under ordinary circumstances, where party fealty or party loyalty was not involved, I am sure that if my hon. friend were of the same opinion now that he was when he submitted the report frow which I have quoted, he would support this resolution without reservation.
No combines ever admit guilt; they are not expected to, except indirectly, in their defence. My experience with wrongdoers is that they are not very courageous; throw the light of open day upon them and they soon take cover. That was the experience in the case of the elevator combine, and also in the case of the fruit combine, in the western country and again in the Annapolis valley. What is all this commotion about throughout the country? What is all this lobbying for? What is all this advertising for? As a matter of fact this institution, this conference-that is its Sunday name-has been torpedoed amidships and is in
Ocean. Shipping Rates

distress; it is flying the signals right now and sending S.O.S. calls all over the country for someone to come to the rescue. I know what it is because I have been in these fights many a time. Sometimes I come out on top and sometimes not; but the combine never came out on top and it will not come out on top this time.
The time will come when we all in this House will have to show our colours and line up either with the people of Canada or the Atlantic conference; we shall have no other choice. I have a clipping here showing that South Africa is suffering under the same difficulty. Here is a little story, and I assure you it is right, to the effect that they are looking about for some way of escaping the irksomeness they feel in respect to ocean rates; they are in exactly the same position we are in. We expect to get recruits and reinforcements in our fight. You may recall, Mr. Speaker, how little Belgium undertook to challenge the marching hordes of Germany. It looked preposterous for her to stand up against such an onslaught of superior force, but her action challenged the admiration of the whole world, and the whole world rushed to her assistance, with the result that we all know. Our action is also going to challenge admiration. Not only that, but it will enlist the support of other countries that are situated just as we are in respect to ocean rates; there is no question about that. But even if they db not come to our assistance, it will only take us a little longer, that is all; and we are going to stay with it until we get results.
Just one word, and I will be through. There is only one move required. You may scoff at this, but you will recall, Mr. Speaker, how at the beginning of the war 'the British army was spoken of as "the contemptible little army," and I say in this matter you may scoff if you like, but we have a right cause, and it is only a matter of time until we get results. How quickly, will depend upon the opposition to the proposal. If you want to delay results oppose this move; but those who oppose it will have to take responsibility not only here but in the country. Results will be attained in a short time if we get the support of the Canadian Pacific, but we shall not get it at the beginning. First of all we have to show that we mean business; that we are right behind this contract, behind the principle of it. Hon. gentlemen may talk about changes being made, but every bill can be changed for the better without altering its principle at all. The Prime Minister has indicated, in order to satisfy the hon. member for Burrard (Mr. 
Clark), that he is willing to make a change with regard to the word "commodities," to which the hon. member objected on the ground that it might mean American commodities, commodities from Honolulu, Jericho or some other place. The Prime Minister indicated he would be willing to insert the word "Canadian," if that were thought necessary to show that Canadian commodities were meant. If there are any t's to be crossed or i's to be dotted, we will make these changes; but the principle of the bill stands. This government, like any other government, is always ready to make changes that will improve a bill so long as they do not interfere with its principle, and this government has indicated its readiness to do that.


Robert James Manion: Mr. Speaker, if anything were needed to convince this House that the whole proposition which it is discussing at the present time was in the nature of a burlesque


William Richard Motherwell: Oh yes, I knew
that would come.


Robert James Manion: My hon. friend is a good
judge of himself. If anything were needed, I say, we have it in the speech of the hon. minister (Mr. Motherwell) who has just sat down. If I did not know that the minister is an absolute prohibitionist I might have come to the conclusion on listening to his speech that he had already taken advantage of the loosening up of the temperance legislation in Ontario.


Some hon. MEMBERS:: Oh, oh.


Robert James Manion: There is this to be said
about the hon. gentleman:	While he is always entertaining, he is very rarely instructive. I think he can say less in more time than any other hon. gentleman in this House. I notice that his last remark was "One word more and I will be through." The hon. gentleman was through an hour before that, but he did not know apparently how to stop.
I notice that one of his statements-and I do not intend at this late hour to take up much time-referred to the signing of letters and editorials and other documents, and while he was criticizing people for not signing letters and statements, he was holding in his hand this statement which is a reply of the steamship lines engaged in the Canadian north Atlantic trade to the charges made by Mr. Preston. My hon. friend from Vancouver South (Mr. Ladner) very properly pointed out that this reply of the steamship lines was signed by the different companies. I

Ocean Shipping Rates
am not speaking for them, but I think the minister might have had the fairness to admit when he was speaking on the matter that this statement was signed by the companies putting it out.


William Lyon Mackenzie King: Does it contain the name of any responsible officer of any of the companies, the president or secretary?


Robert James Manion: I do not think any company would require to have their secretary's name there in addition to the names of the companies. I can read the names of the companies who are responsible for this statement. They are as follows:
Anchor-Dcnaldson Line, Ltd., Cuna.rd Line.-The Robert Reford Co. Ltd.
Donaldson Line, Ltd.-The Robert Reford Co. Ltd.
Cairn Line of Steamships (Thomson Line).-The Robert Refo-rd Co. Ltd.
White Star-Dominion Line.-
Canadian Pacific Steamships, Limited.-
Furness Line.-Furness, Withy & Co. Ltd.
Manchester Liners.-Furness, Withy & Co. Ltd.
Head Line.-McLean, Kennedy, Limited.
Scandinavian-American Line.-McLean, Kennedy, Limited.
Inter-Continental Transports,	Limited.-Canada
Steamship Lines, Ltd.


William Lyon Mackenzie King: Who signed for the Robert Reford Company?


Robert James Manion: It is signed "The Robert Reford Co., Ltd.".


William Lyon Mackenzie King: Who signed for that company?


Robert James Manion: It is signed by the company itself. Does the Prime Minister mean to suggest that these companies who have put their names to this statement would deny that they are the authors of it?


William Lyon Mackenzie King: My hon. friend would not take as a contract the signature of a firm without the name of some officer of that firm.


Robert James Manion: Nor would you take as a contract a resolution in printed form before the House. As a matter of fact, the very weakness of the hon. gentleman's argument is this: The Minister of Agriculture, when he was making these charges about statements and letters being unsigned, spoke of the Preston report. I glanced at it while he was speaking, and on page after page I find that Mr. Preston quotes statements by correspondents who say this, that and the other thing, and he does not even mention who they are.


William Richard Motherwell: Does he not sign the report?


Robert James Manion: Yes, but he bases his report on the statements of no one that we know. For example, he has a memorandum on the export of sole leather, and simply introduces it with the statement that "the largest sole leather tanners in the British Empire explain" such and such a thing; but he does not say who that is, and there is no signature.


Mr. HAMMELL:: I will tell the hon. member who that is if he wants to know.


Robert James Manion: That is not the point. My hon. friend may tell me all kinds of things. He will have a chance to speak later on. I am simply quoting Mr. Preston's report to show that he does not quote any authority by name for his statements.


William James Hammell: Everyone in Ontario
knows who that is.


Robert James Manion: Everyone in Ontario does not know, because I am in Ontario myself and I do not know.


William James Hammell: You do not know anything about the leather business.


Robert James Manion: I hope my hon. friend has more knowledge about that business than he shows in discussing many other subjects. Mr. Preston goes on and gives a quotation from "Another factory seriously affected." All he gives in that case is "A prominent manufacturer of agricultural implements"; but he does not say who that is. On the following page I find this: "From other sources the following complaints are made"; but there again no name is given, and there is no signature or anything to show where he got the information from. Again, "A very large manufacturing company in Toronto" writes and tells him something; but he does not say who it is. Again "The chairman of an Ontario city chamber of commerce" writes; but he does not say what city or what chamber of commerce that is. There is page after page of that sort of thing. So the Minister of Agriculture, in accusing some of our party of using statements which were unsigned, overlooked the fact that he was supporting a contract that was based upon a lot of statements that were not signed bjr the companies that gave them to Mr. Preston. I do not wish to waste any more time on the minister's speech because throughout the whole of his remarks I do not think he put up an argument either for or against the contract; he simply wasted the time of the House for about an hour and a half.
I wish to mention just one other thing, as other speakers have done, before I go on. The Prime Minister said here to-night, in reply
Ocean Shipping Rates

to the member for Red Deer (Mr. Speakman), that even if this contract went to a special committee the government was ready to accept whatever proposal the special committee made.


William Lyon Mackenzie King: Is my hon.
friend referring to my remarks? I do not think I used the word "accept" at all, I said the government would be prepared to consider any suggestion that might be made by the committee.


Robert James Manion: I will accept the Prime
Minister's statement but he went further and said they were ready to deal with any suggestion which the committee might make. I put it to any hon. member in the House if the right hon. gentleman did not go that far.


William Lyon Mackenzie King: I did not say that the government would "accept".


Robert James Manion: The other evening in reply to the hon. member for Vancouver Centre (Mr. Stevens) the Prime Minister made the statement:
Mr. Mackenzie King: The agreement will be passed just as it is, it cannot be trimmed up.
Which statement from the Prime Minister are we to accept, the statement made the other day or the statement made to-night?


William Lyon Mackenzie King: If my hon.
friend will read the words that occasioned that reply he will see the relevance of it.


Robert James Manion: I do not wish to waste the time of the House, but if the Prime Minister insists I wall do so. This is before the reply in question of the Prime Minister.
Mr. Stevens:	I rather suspected that-
In reference to some remark by the Prime Minister.
-I rather suspected that the government would be anxious to get this agreement to a private committee away up somewhere so that they could trim it up in order that it might be a little more presentable.


William Lyon Mackenzie King: Yes, exactly.
Mr. MANION. I go on to quote:
Mr. Mackenzie King:	The agreement will have to
pass just as it is. It cannot be trimmed up.
Then a little lower down Mr. Stevens said:
My right hon. friend stated a moment ago that this agreement stands and not a letter of it can be changed.
Mr. Mackenzie King:	It does stand.
So it is the case of the gentleman who said "You can pay your money and you can take your Choice." We can either take the statement of the Prime Minister to-night in reply to the hon. member for Red Deer, or we can take his statement the other day in reply to the hon. member for Vancouver Centre.

Now Mr. Speaker, I am not going to deal wdth this agreement from the standpoint of a transportation man, nor from the standpoint of a lawyer, nor from the standpoint of a shipper; I am going to try to deal with it in a very brief way from the standpoint of the ordinary man in the street, the man Who looks at the agreement just as the ordinary citizen should look at it, and I am going to make whatever brief observations I have to offer from that attitude.
In the first place the thing that strikes me and, I believe, the thing that strikes anybody in looking at this proposition is, that it is either based upon or supported by -we understood at first " based upon " but now they say " supported "-a report of W. T. R. Preston. I do not know Mr. W. T. R. Preston but I do know that very many charges have been made against him of political trickery, if you wish to put it that way. I do know that Mr. W. T. R. Preston is a man who is discredited among ordinary people. That is the feeling of the ordinary man towards W. T. R. Preston; and I find myself asking why this government, representing the people of Canada, should have chosen Mr. W. T. R. Preston, when they had so many respectable outstanding lawyers, so many respectable business men in the Liberal party to choose from. If you look over the report-and I have looked it over and studied it fairly carefully-you will feel that the report is plainly the irresponsible report of an irresponsible man. It is particularly notable for its attacks upon outstanding men in the shipping business, not only in Canada but in Great Britain. It goes so far, Mr. Speaker, as not only to accuse these men of being crooked but to accuse them of being traitors to their country. Because if you read the report you will find that again and again Preston gives evidence-evidence, according to this statement, satisfactory to him -which proves to himself at any rate, that these men are conspiring-I could quote his actual words but I shall not take the time- are conspiring against Britain, are conspiring against Canada, in favour of Germany, in favour of Holland, in favour of the United States, and in favour of practically every other country in the world. Well, I have no brief in any shape, manner or form for the shipping men, either in England or in Canada -I presume they are well able to defend themselves-but I must confess that I believe somewhat in the old British principle that men should be regarded as innocent until they are proven guilty. But Mr. Preston takes the reverse attitude; he believes,

Ocean Shipping Rates
apparently, that men should be considered guilty until they are proven innocent.
There seems to be throughout the whole country to-day a tendency to accuse any men who are in big business of being crooked, just the same as there is a tendency throughout this country to-day to accuse any man who is in politics of being a grafter. It all comes apparently from the same line of thought. It is, apparently, due to a diseased mentality on the part of a great many people that they seem to think that most of the members of this House, of any party are out for graft or crookedness. Well, I might say this now, although I did not intend to, that I have been a member of this House for eight years and never have I heard or seen of any crookedness going on, never have I been offered graft in any shape, manner or form.
As to the lobbying which the Minister of Agriculture spoke of a few moments ago, and which he says is going on at the present time in regard to this contract, I have seen nothing of it and I doubt whether anybody else has; I do not think there is anything in the charge. I believe, Mr. Speaker, that most men, whether they are big business men or small business men, prefer to deal with their fellow beings, with their fellow corporations, in an honest manner. For example would it be fair to assume that the leading men of the great Canadian Pacific Railway-Mr. Beatty, Mr. Grant Hall, Mr. D. C. Coleman, Mr. Lanigan and the others, the chief men of that company-have not the interests of this great Dominion of Canada at heart? Why the Canadian Pacific Railway is as much dependent on the success and prosperity of the Dominion as any individual in this country is dependent upon the success and prosperity of Canada. So that I think the whole attitude that Mr. Preston took in dealing with this investigation -if investigation it can be called, because most of these companies, in a statement that all hon. members have received, claim they never saw or heard from Mr. Preston, so that I doubt if what he did can be called an investigation-is open to suspicion. Anyhow I believe we should regard (most of these men as innocent until they are proven guilty.
There is another observation I wish to make, and that is as to the uselessness of the scheme as proposed in this contract. Here we have a proposition to engage from Sir William Petersen ten ships. Now it has been shown here again and again-by statements which have not been refuted and which nobody at-temps to refute-that these ten ships could make perhaps 5 per cent of the trips next
year to Montreal if they were all on duty, perhaps 4 per cent. According to figures I have seen there were some 1,200 trips made by various lines of steamships to Montreal last year. The most anybody claims for these ten ships is that they could make fifty or sixty voyages to the port of Montreal. Now what possible effect could fifty or sixty trips have upon the other eleven hundred trips into the port of Montreal? What possible effect could 5 per cent of shipping have upon the other 95 per cent? It appears to me like an attempt to dam back Niagara with a broom. And for these ten ships the people of Canada are asked to put up in round figures 81,350,000 per annum, and with any increase in the number of ships that subsidy will be increased pro rata; and it has been pointed out by the hon. member for Red Deer, the hon. member for Vancouver Centre, the hon. member for Burrard, and by others, if these ships were used, for example, in the handling of wheat alone they could not handle more than about 13,000,000 bushels out of the 150,000,000 bushels that were shipped from Montreal last year-in other words they could handle about 8 per cent of the wheat shipped from Montreal if they had nothing else but wheat to carry throughout the whole season. What effect would the lowering of the rates on that eight per cent of wheat have on the other ninety-two per cent?
I am not so sure of this fact, but I am informed that if the ships were devoted to the cattle trade alone they would be able to handle only one-half of the cattle leaving the port of Montreal. That I suppose is correct; I do not think I have over-estimated it. But if they could handle only half of the cattle shipped out what would be done to take care of the other half? Are we to subsidize a shipping concern merely for one group, and that a small group, of people doing business in the country? What about the exporters of wheat, the manufacturers, and the other shippers in the country?
It is true that the rates have been increased since 1913; no one disputes that. But everyone admits, as does the hon. member for Brome (Mr. McMaster), that the expenses of the companies have also gone up. That hon. gentleman speaking on the floor of the House of Commons the other day admitted that the expenses of the companies had gone up one hundred per cent. If this is so, the companies have only increased their rates in accordance with the advance that has been made in their expenses, according to the hon. member for Brome. Now, to make this scheme effective at all, there is only one thing
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to do, and that is to subsidize a larger number of ships. In other words, at a rough guess, I should say that to make the scheme reasonably satisfactory, it would be necessary to subsidize forty more ships, so that there would be five hundred trips. This would be indispensable if it were really intended to control Atlantic shipping rates to any extent. That would be fifty ships in all, or five times the number now proposed; that is to say, we should have to spend five times the amount of the present contract of $1,350,000. That would represent a total expenditure of some seven million dollars per annum. How long would the people of this country consent to put up even half that amount every year for the purpose of subsidizing just a portion of our shipping?
There is another clause in the agreement which I desire to touch upon, and as I am not a lawyer I shall give to the House the interpretation which a prominent legal friend of mine has placed upon it, and which interpretation, I may say, has been endorsed by two other lawyers of my acquaintance.


Charles Gavan Power: Will the hon. member give
the names of those lawyers?


Robert James Manion: Oh no, that is not necessary, but I will introduce my hon. friend 11 p.m. to them outside, one of these days. Let me read from the third clause of the contract:
3. And it is mutually covenanted and agreed between the parties hereto that the subsidy payable to the contractor in the preceding paragraph is based on the operation and maintenance of a sendee of ten ships and the subsidy aforementioned shall be increased or reduced as the case may be in proportion to the number of ships operated and maintained by the contractor in the service aforesaid from time to time and such increase or reduction of subsidy shall be added to or deducted from the monthly payments hereinbefore provided for in paragraph two.
I have consulted a prominent lawyer on this clause and his interpretation I have submitted to two other legal gentlemen 'both of whom concur in it. According to this interpretation, clause three of the contract gives to Sir William Petersen the right to increase the number of ships to any extent he wishes, and he may come to this government at any time and demand an increased payment in proportion.


Frank S. Cahill: How would the government obtain the money without its being voted?


Robert James Manion: The government has signed a contract by which it agrees either to increase or decrease the number of ships that are to operate, and I submit that once the agreement is accepted and ratified by parliament Sir William Petersen can increase the number of ships and the government, without coming

to parliament, can pay any increased amount he may demand. At all events, Sir William Petersen, if the interpretation which I have received of this clause is sound, could sue for damages in those circumstances if he were not reimbursed for any further expenditures he might make in connection with the increased number of ships he might put on. Of course, I am simply placing this interpretation before the House as it has been given to me. My authority carries no weight; in fact, I have no authority so far as the legal aspect of the case is concerned, for I have not had the training of a lawyer. But reading the clause as it stands in the contract, I should think that the interpretation I have cited is reasonable.


William Lyon Mackenzie King: The government has Mr. Lafleur's opinion to the contrary.


Robert James Manion: That may be so, but one
of these gentlemen whom I have consulted is as prominent as Mr. Lafleur.


William Duff: Whereabouts in the contract
does the hon. member see any suggestion that the number of ships may be increased above ten?


Robert James Manion: Clause three distinctly declares that Sir William Petersen may increase the number if he desires to do so.


William Duff: Not the number of ships.


Robert James Manion: Let me read a part of the clause again:
And the subsidy aforementioned shall be increased or reduced as the case may be in proportion to the number of ships operated and maintained by the contractor in the service aforesaid.


William Duff: Read before that; the number may be up to but not above ten.


Robert James Manion: It does not say so; that at least is not my interpretation of the clause, nor is it the interpretation of these lawyers.


William Duff: Who are these lawyers?


Robert James Manion: That does not matter; my hon. friend can get the opinions of other lawyers if he wishes.


William Duff: The meaning is obvious enough without the opinions of any lawyers.


Robert James Manion: My hon. friend may be
able to see these things with a clear eye, but lawyers who are trained in interpreting matters of this kind do not see eye to eye with him on this particular question.


William Duff: Lawyers differ.


Robert James Manion: So do shippers.

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William Duff: No, they agree, and that is
why there is a combine.


Robert James Manion: At any rate, according
to my interpretation of the clause, which as I say is only the interpretation that competent lawyers have put upon it, this whole contract is made to take care of Sir William Petersen and not to protect the interests of the country at large. A few weeks ago I read a quotation from one of the English newspapers in which Sir William Petersen was represented as having advised his shareholders not to sell stock. "If you wish to sell any stock," he is reported to have said, "sell it to me; I will buy it from you." That was quoted from the English newspapers, and this was before the contract had been laid before parliament. It is no wonder, then, that he takes that attitude, for the contract is all in his favour.
Now, I will consider the contract from the financial point of view. The cost of these ships is admitted to be about six million dollars, that is to say, some six hundred thousand dollars each.


Lewis Herbert Martell: I presume that the hon.
member has read subsection (c) of section one. That paragraph provides that the service shall begin with ten ships, and towards the end it states:
The said service to commence with at least six ships not later than June 15, 1925.
Now, I do not want to oppose my knowledge of law to that of eminent lawyers who have considered this contract. But where the minimum is prescribed as six, how can you fix a maximum higher than ten, when the contract provides that the number of ships shall not be less " than, ten?"


Robert James Manion: But there is a subsequent clause which provides that by mutual agreement the number may be increased above ten.


Lewis Herbert Martell: I do not know that
anyone is objecting particularly to that. Speaking as a private member, I should say that no one would -take any exception to such a provision, for if the scheme is to be effective there should be some 'leeway. But under subsection (c) of section one it would seem that a minimum of six is provided, and the maximum is laid down at ten.


Arthur Meighen: The hon. member will
see at a glance that it is a maximum which is compulsory on Sir William Petersen; that is all that he is obliged to provide. But the clause quoted by the hon. member (Mr. Manion) shows that if Sir William Petersen 64
provides more ships he must be paid accordingly.


William Duff: The maximum is ten.


Robert James Manion: Hon. gentlemen may interpret the contract for themselves just as they please. I have given the interpretation of three lawyers, and that interpretation appeals to me as reasonable. To proceed with the financial aspect of the matter. It is admitted that if these ten ships are built they will cost some six million dollars, and the subsidy is to be $1,350,000, which amounts to about twenty-two per cent per annum on the total. Now, if Sir William Petersen runs these ships so as barely to clear his expenses he can use ten per cent of that twenty-two per cent to pay off a sinking fund and interest on his loan and he can take the other twelve per cent for himself. This would be a pretty fair return for Sir William Petersen. Let me put it in another way. Let me take the same figures again, $6,000,000 as the cost of the ships. Supposing Sir William Petersen borrows this money and wishes to pay it back at the rate of 10 per cent per annum. That would mean that he would pay back $600,000 of principal each year for ten years. As this money would be advanced on a government guarantee, he would get it at 5 per cent interest, and his interest on $6,000,000 would be $300,000. That means that he would have to pay $900,000 out of his $1,350,000 in the first year. If he can, in the first year, run his ships without loss, just with them paying their way, without any profit-and it must be remembered that he is going to be provided with cargoes because the government naturally is going to help him to get cargoes through the Canadian National railways-Sir Wiliam Petersen will have $450,000 profit in his first year. The second year he will have a profit of $480,000-I am giving round figures because I do not wish to get down to exact figures-for the reason that in the first year he will have paid off 10 per cent, or $600,000 on the principal, and, therefore, will have $30,000 less interest to pay. The next year he will have another $30,000 less interest to pay and so on. At the end of ten years Sir William Petersen would own the ten ships. He would have paid off the 100 per cent at the rate of 10 per cent per annum. He would have paid off his interest and sinking fund completely and he would also have a profit of from six to seven million dollars.


An hon. MEMBER:: Plus the ships.


Robert James Manion: Yes, plus the ships. That is provided that he just carried himself along.

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William Duff: Would it not all depend upon what rates the government would fix upon the commodities those ships carried?


Robert James Manion: Yes, it would.


William Duff: For instance, if the government fixed the rates too low, Sir William Petersen or anybody else would lose a good deal of money.


Robert James Manion: He would quit.


William Duff: If the government fixes the
rates high, he makes money.


Robert James Manion: If the government makes the rates too low, Sir William Petersen quits and there is no penalty clause.


William Duff: Then my hon. friend's argument falls to the ground.


Robert James Manion: If the government fixes the rate so low that Sir William Petersen will quit, then the agreement is a bigger bluff than we thought it was.


Lewis Herbert Martell: There is no penalty clause provided for either party, but would Sir William Petersen not be amenable according to the ordinary principle of law, to damage for breach of contract?


Robert James Manion: There is no sign of any clause to that effect in the agreement. The penalty, so far as I can see, will come in on the people of Canada.


Lewis Herbert Martell: My hon. friend knows quite well that it is incident to every contract that if a man is guilty of a breach, he is liable for damages.


Robert James Manion: I understand Sir William Petersen is going to hand this over to a company, but the company is not liable under the agreement. There is no penalty clause in any manner, shape or form so far as I or anybody else can find out.
Supposing this is going to be made effective; supposing the government carries this out with Sir William Petersen, Sir William supplies more ships, and the thing is so effective that Sir William Petersen is carrying enough freight to interfere with rates on the Atlantic, then there is the risk of bringing about on the ocean the same condition as this government brought about on the lakes. In other words, there is the danger of driving the tramp steamers from the ocean altogether. The hon. member for Lunenburg (Mr. Duff) is a good shipping man and he will remember that when the legislation in regard to freight rates was passed, which the Minister of Labour claimed was going to

burst up some of those combines, trusts and mergers of which he talked so much, what it did was to drive from Canadian lakes American shipping which stayed away from the lakes until the Board of Railway Commissioners, on the advice of the Department of Trade and Commerce, went across to the American shippers and asked them to come back into Canadian waters and to ignore the law which this government had put on the statute books.


William Duff: My stand was quite all right on that.


Robert James Manion: I am not questioning my hon. friend's stand in that regard. He is always right. The only thing I would suggest to him would be to join up with the party in which he believes and that is over here.


William Duff: I have had an invitation
already.


Robert James Manion: The danger, to be serious, is that our last condition may be worse than our first, because we must not forget that these tramp steamers have been handling a large proportion of the grain out of Montreal. Last year tramp steamers out of Montreal handled from fifty to sixty per cent of all the wheat that went from Canada and they got at the same time higher Pates in handling it than were given to the ships in the conference, the reason being, as I figure it out, that the conference lines have a regular schedule of trips. In other words, they have to sail from Montreal on certain stated days, and they have at times to take wheat, for example, at lower prices for ballast. Therefore, they do cut down below the tramp ships in rates. It is stated in some of the statements that we have received here,-and it has not been refuted-that tramp ships handled one-third of the grain that went from Montreal last year to the United Kingdom.


An hon. MEMBER:: Sixty-two per cent.


Robert James Manion: According to my figures, two-thirds of the wheat going to British ports was handled by the conference ships and one-third by the tramp steamers. But of the wheat handled all over the world, that is to Italy, France, Spain, Germany and so forth, about 62 per cent was handled by the tramp steamers. As I say, of wheat going to the British Isles, the tramp steamers handled one-third last year. On that one-third, they got eleven pence per quarter, which, according to my figuring, is 22 cents for eight bushels, or roughly, a 'little less than three cents a bushel

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more, for the 15,000,000 bushels they handled than the conference got for handling the 30,000,000 bushels which they handled.


Lewis Herbert Martell: If by this agreement the government is to pay only for services performed, that is, if the services have to be performed before the government pays anything, how can the government be mulcted in damages by an action at law?


Robert James Manion: That is a legal question and I do not wish to get involved in legal questions. I am not a lawyer. My hon. friend is a lawyer and he can make a speech later on and argue as he chooses. I have given the interpretation as it was given to me by three eminent lawyers.


Lewis Herbert Martell: I was asking my hon. friend only for information.


Robert James Manion: I do not mean to be
offensive towards my hon. friend, but he will pardon me if I go on with my argument. We all take the attitude that a fair day's work ought to be given for a fair day's pay, or, putting it the other way, that a fair day's pay ought to be given for a fair day's work. Exactly the same thing should) be true in regard to capital and labour. One is about as important as the other. You cannot very well develop a country just by labour or just by capital. You need both capital and labour. Therefore you should give a fair return to capital. Yet, practically all these steamship lines, in their statements which have been placed in the hands of every hon. member, claim that within the last few years they have been hardly holding their own, or they have been losing. In the face of that, we are out to cut down the rates. I have a statement here in which they state that three or four of the conference lines running out of Montreal have offered:-and the government will deny it if they do not agree with this statement-to permit this government to send any reputable corporation such as Price, Waterhouse and Company, or any other reputable accounting firm, to examine their books in order to see exactly how they have been getting along during the last few years, because they claim that their net earnings have been less under the high rates now prevailing than they were under the comparatively low rates of 1913. In addition to this, it is stated that there are to-day six or eight million tons of shipping tied up for lack of business, and much of that tonnage is made up of tramp ships. Well now, if these were only conference ships the retort might be made that they were being kept idle in order that higher rates might be
charged on the ships remaining in commission. But, if the shipping business is such a paying proposition to-day, why do not those tramp ships engage in the business and reap some of the rich profits? It is also stated on the authority of Lloyds that there is to-day fifteen million more tons of shipping in the world than in 1913. Yet under this contract the government is asking Sir William Petersen to still further increase the surplus shipping for which there is no business. This lack ^ of cargoes is one of the reasons why the Canadian Government Merchant Marine is operating at a deficit every year; it cannot get business on a paying basis.
Another point I wish to touch upon very briefly, and I wish to draw it particularly to the attention of hon. members from Montreal, is the danger,, which I should like some of them to look into, of American traffic which is now going throulgh the port of Montreal being diverted to United States ports if the Canadian government, by subsidizing certain shipping cmpanies, interferes with shipping from Montreal. I do not wish to elaborate this statement, which I have had from good authority, but in such a way that I dio not think I have any right to discuss it further at the moment.	_
In his report Mr. Preston quotes individuals for the most part, he does not quote groups at all. Since his report came out we have had statements from one group at least, the Canadian Council of Agriculture, that it is opposed to the whole proposition as it stands to-day. We have also had an editorial in the Grain Growers Guide quoted in the eastern papers to the effect that the Guide is not enamoured of the proposition.
If I had my way, Mr. Speaker, I would move an amendment that the resolution be taken up this day three weeks, which would bring it forward on April 1, because I think it is one of the best jokes the government has ever put over on the people. This government has put over quite a number of jokes. For instance, the hon. Minister of Labour (Mr. Murdock) had his famous joke that I have already referred to about combines, trusts and mergers, which he threatened to wipe out as soon as he got into power. Of course, he had to have his little joke. The hon. Minister of Agriculture (Mr. Motherwell) who gave us his fine vaudeville entertainment to-night, told the people of the west that if elected he would come down here and have the Chairman of the Board of Railway Commissioners wiped off the map. That was one of his little jokes. And we have had a number of others. For example, the Prime Minister put a good
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joke over on the people when he was talking of bringing in free trade to satisfy the west and was advising the east to stick to protection.


William Lyon Mackenzie King: Hold on! Joke as much as you like, but keep to the truth. When did the Prime Minister ever talk of bringing in free trade?


Robert James Manion: He talked of it in his 1919 platform to a great extent, and, furthermore-


William Lyon Mackenzie King: There is no joke in putting on record a number of things that are not true.
Mr, MANION: My hon. friend the Prime Minister is pretty much an adept at that himself. He went out in the prairie provinces and told the Progressive members, not once but many times, to link up with him because his and their platforms were the same. Would the Progressives claim that their party is not for free trade? They are all for free trade.


Mr. JOHNSTON:: No.	.


Robert James Manion: I do not know what the
hon. whip of the Progressive party would claim. He has been more things than I have.


John Frederick Johnston: The hon. member for
Fort William has made a direct charge that I have been more things than he has. I have at least stuck to principle. I have never, Mr. Speaker, departed from principle, and that is what my hon. friend has done.


Robert James Manion: My hon. friend makes a
mistake. He means he has never departed from party. I have stuck to principle, but he has stuck to party. Of course, he has got as a reward recollections of a very pleasant trip to Wembley exhibition at the cost of the people of this country. What I was saying when the Prime Minister so jovially interrupted me was that the right hon. gentleman has had a lot of jokes at the expense of the people of this country on many occasions, for example, first implying ,to the western people that they were going to get free trade if they joined up with him.


William Lyon Mackenzie King: I never implied anything of the kind.


Robert James Manion: And then he told the
people of the east that he was sticking to protection. At the present time the joke is that we are going to have a pause in tariff [DOT]tinkering, ibut nobody knows for how long. But of all the jokes ever put over on the people of Canada I sincerely believe the

present is the best. If the Minister of Agriculture would support me I would move that we take up this question this day three weeks, when it could be brought forward on April 1, all fool's day.


Lewis Herbert Martell: Who is going to be the
April fool, you or the Minister of Agriculture? I think you will be.


Robert James Manion: I think we will go down
to Nova Scotia and get the fool.


Mr. T. G. McBPIDE (Cariboo):: Mr. Speaker, in rising to take part in this debate, I do not want to find any fault with the government; I think it deserves a great deal of credit for investigating a problem of this kind that has been before this House at least since I came to Ottawa. Now, Mr. Preston states that there is a gigantic organization, indeed a conspiracy, to prevent competition in ocean transportation to and from Canada, a combine which, according to his statement, includes the British steamship companies. There is also, he says, an insurance combine. Indeed two gigantic organizations united to work against the interests of the agriculturists, manufacturers, fruit producers, importers, merchants, lumbermen, the pulp and paper industries, labour-in a word, against the great struggling masses of the Canadian people. In my judgment, Mr. Speaker, that last sentence is what one might expect from a third-class tap-room politician, and Should never have been recorded in a report of this kind.
Now, according to his report, he has secured information from many sources. Where does he get it? He gets some of it from the manufacturers, a class of people enjoying from twenty to thirty per cent protection, and now they want freight rates lowered so that they can make still greater profits. Was that a proper organization for Mr. Preston to get information from? I would say not. He also gets information from the Lethbridge Board of Trade. What does that board know about the difficulties of navigation? They passed the following resolution:
Therefore be it resolved that the Canadian government be urged to take such steps as may be necessary to have Atlantic rates on cattle reduced to a point where cattle from Alberta can be profitably exported to the United Kingdom.
But they do not say th.-V Khey should bring profit to the steamboats
Now, in regard to freight	I do not
know that I will cover the ground that has already been covered, but I wiH give my personal experience in that connection. If the government want to verify the figures that I am about to give, they can go to the firm

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of T. G. McBride and Company at Vancouver and get them. In 1904 I went into the freighting business. I built a steamer. At that time and for many years afterwards we carried lime, for instance, at 10 cents a barrel of 225 pounds, and if we got a full cargo we often carried it at 8 or 9 cents a barrel. At that rate we made a profit on our investment. To-day we are getting 25 cents for a barrel of 200 pounds, and we make less profit than we did when we were carrying the lime at 10 cents a barrel. Now, the question may be asked, what accounts for the difference in the expense? I will give you some items, and I may say I got the figures from my office at Vancouver. In 1900 and up to 1912 a captain got $85 a month, which included board and a place to sleep on the boat; now he gets $170 a month. An engineer at that time got $65 a month; now he gets $150. The mate then got $50; now he gets $110. The second engineer got $40; now he gets $105. The deck hands then got $35; now they get $75. The cook got $26; now he gets $80. These wages are not at all too high. From 1896 up to 1912 the poorest paid class of labour, taking into consideration the responsibility involved, were the steamboat men and the railway men. Now they are getting a fair wage, and the consequence is that freight rates have to be increased to meet it. But that is not all. In 1900 and up to 1912 our fuel cost us $2.75 a ton; now we pay $7.50-quite a difference. Not only that, but take the question of insurance. A boat is insured for what it is worth. At that time if a boat cost $20,000 and was insured at her full value, the cost at the usual rate of 7 per cent would be $1,400. To-day that same boat is worth $40,-000-cannot be replaced for less; therefore it is insured for $40,000 and instead of paying $1,400 for the insurance we pay $2,800. But that is not all. You have to keep the crew insured; there was none of that in previous years. You have got to pay harbour dues; that was not done previously. You have got to pay sick mariners' dues-I may say that that act was passed in 1920 by the previous government. Moreover, we carry most of our freight on the Pacific coast on scows, upon which there is no crew.


Lewis Herbert Martell: Will my hon. friend
allow me to correct him? I simply wanted to point out that the law with respect to sick mariners' dues was passed long before 1920.


Thomas George McBride: It was passed dn 1920.
I can show that by a letter I have from the Deputy Minister of Marine and Fisheries.


Lewis Herbert Martell: The same principle had been adopted before.


Thomas George McBride: According to this lettei
from the department the act was passed on July 1, 1920. We have to pay sick mariners' dues on these scows, under the act. Then we have to pay personal property tax on the boat, to the provincial government. Then we have to pay income tax, if there is any income, not only to the Dominion government but to the provincial government. Taking all these things into consideration, how can it be expected-and this is one point, I notice, that has been left out of this debate-


William Duff: My hon. friend refers to
coastal shipping, not to Atlantic or Pacific shipping?


Thomas George McBride: I am referring to shipping on the Pacific coast. How can people expect the same rates to prevail now that prevailed some years ago? In the United States the government fixed the rates on the Pacific coast, minimum and maximum, and if those rates are cut or exceeded there is a fine of anywhere from $5,000 to $10,000. That means that they get a better rate; dn fact, they are getting anywhere from 10 to 57 per cent more in Puget Sound than we do ni the British Columbia waters. It means that when there is a slack time they can operate their boats even at a loss, and keep their crews working whereas on our side of the line we are working very largely without profit or rather we are not making a fair profit on our investment and we have to discharge our men and tie up our boats when the slack time comes.
We have heard a great deal about the carrying of passengers. Mr. Preston points out in his report, if I remember rightly, that about 1894 passengers were carried from the Old Country to Canada for $17. I will admit that passengers were carried for $17 at that time, for that is the amount I paid when I came to Canada. But what was the accommodation given? What did we get for $17? Well, I will tell hon. members, for their information; there were two men in each stall -I will not call it a berth. The stall consisted of a compartment, I would say, four feet wide, six feet long and about seven feet high. There were two shelves in each compartment, made of boards each nine inches wide, no mattress, no blanket; absolutely nothing to lie on except those two nine-inch boards. Give some of our immigrants that accommodation to-day and what would they think of it? As for the food, at no time during that voyage did any of the steerage passengers get sufficient food to
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satisfy hunger, unless they went to the galley and bought it. They had to supply their own utensils and keep them clean. Will any person who wants to be honest and fair make a comparison between what the rates were then and what they are now? Last Easter I was down at Halifax and I had the privilege of going through one of the passenger boats there. I took particular care to go through the steerage department. What did I find? Good clean mattresses in each compartment. Some of the compartments would contain two berths, some three, and some four to accommodate families, and in every one of them you would find every accommodation that you would get in a hotel. Their food is first-class, and is served at the table on clean tablecloths. Is there any comparison between the accommodation the people are getting now and what they got then? If the government would take five or six of their merchant marine ships and provide the accommodation that passengers used to get at the same rate, I venture to say they would not get twenty-five passengers a month. The trouble with the public at the present time is that they demand a certain standard of service, and those engaged in the business are willing to provide them with that service, but the public are not willing to pay for it; they want to let the other fellow pay. And why should the taxpayers of this country be assessed, to give accommodation to a certain class of people?
In conclusion, I can see no good point in this Preston report from start to finish. It says a whole lot about insurance and a combine on insurance. I have been insuring boats for the last twenty years, and I will say this for the insurance companies:	I have always got
a square deal. I have always found them wanting to give a square deal to their customers. They have to do this to get the business. There are different ways of insuring boats. In some cases an insurance
company will take off 3SJ per cent, new for old; that is, if a boat goes on the rocks and loses her keel, and a new keel has to be put in, they will take a third off, new for old, considering the new keel is worth one-third more than the old. There are other ways of insuring. In some cases you will get no insurance unless damage is done to the extent of 10 per cent of the total value of the boat. Others will insure in this way; If you knock a blade off your propellor, they will replace it Taking them as a whole I have found insurance companies willing every time to act fair and square with the people if the people are willing to act square with them. I have done shipping to Australia; some years ago I did quite a lot of shipping to Honolulu and the Old Country, and I have got considerable material from the Old Country in the days when it came round the Horn, and I found the shipping companies as a whole always wanting to do what was right. Their freights might be a little high sometimes, but they must have a profit, for their ships are often tied up and they require a profit that will allow for depreciation. When I came to this country first the Canadian Pacific had three of the finest ocean going steamers, I guess, that ever were launched^-the Empress of Asia, the Empress of China, and the Empress of Japan. They were a credit to any port, but within the last six years the Canadian Pacific has had to scrap those steamers. Why? Because the public in general demands a better service. They want swimming pools aboard their boats; they wiant baths and gymnasiums and the like; but the trouble is they do not want to pay for the accommodation. I cannot support this resolution.
On motion of Mr. Duff the debate was adjourned.
On motion of Mr. Mackenzie King the House adjourned at 11.41 p.m.



END OF VOLUME I.