Right Hon. R. B. BENNETT (Prime Minister):: I desire to lay on the table the 
correspondence between the government, the Canadian Pacific Railway Company and the Canadian banks with respect to the guarantee by the government in regard to the loan of $60,000,000 to the Canadian Pacific Railway Company. At the same time I offer my apology to the hon. gentleman for the delay in presenting these papers, which was due to certain papers being mislaid.



RADIO BROADCASTING COMMITTEE

[Stage Direction]
Hon. RAYMOND D. MORAND (East Essex) moved that the first report of the special committee to inquire into operations of the radio commission under the Canadian Radio Broadcasting Act, 1932, be concurred in.
Motion agreed to.

[Stage Direction]
A message from His Excellency the Governor General transmitting further supplementary estimates for the financial year ending March 31, 1934, was presented by Hon. E. N. Rhodes (Minister of Finance), read by Mr. Speaker to the house, and referred to the committee of supply.

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved for leave to introduce Bill No. 37 to amend the Bills of Exchange Act.
He said: Mr. Speaker, this bill proposes two amendments to the Bills of Exchange Act. The first substitutes the name Remembrance Day for Armistice Day, in conformity with the legislation that was passed in 1931. The second amendment proposes to authorize the closing of branches when civic holidays are declared.
Motion agreed to and bill read the first time.

[Stage Direction]
Hon. ROBERT WEIR (Minister of Agriculture) moved for leave to introduce Bill No. 38 to amend the Dairy Industry Act.
He said: There are two principal changes to be made in the act. One is a change in the definitions to keep the act more in line with modern practices and the other is an extension of the act at the request of a number of the provinces.
Motion agreed to and bill read the first time.

Questions

[Stage Direction]
Hon. ROBERT WEIR (Minister of Agriculture) moved for leave to introduce Bill No. 39 to amend the Destructive Insect and Pest Act.
He said: There is a very slight change to be made in this act. The proposed amendment, which is regarded as an interpretive section, does not affect the intent of the present section but is necessary in order to enable the various provinces to deal with the control of pests in their respective territories, and is being made at their request.
Motion agreed to and bill read the first time.	[DOT]

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

Mr. MOTHERWELL:: 1.	What were the conditions of the original cattle quota imposed on Canadian cattle by the British government?
2.	What are the adjusted cattle quota terms and conditions at present in vogue?
3.	Is there anything definite yet as to the cattle quota that will prevail during the last half of the year 1934?
4.	Does the British government under the terms of the Anglo-Canadian Ottawa agreement impose such cattle quotas without the consent of the government of Canada?


Richard Bedford Bennett: Mr. Speaker, I think it should be
said with respect to this question that the matter is under consideration. The quota as fixed was arranged by the High Commissioner for Canada with the British Government, and negotiations are now pending for the purpose of determining what the future action shall be. But the quota as it stands is that we should ship the same number of cattle as we shipped in the first six months of 1933-and there the matter stands at the moment.


GOLD PREMIUMS
Mr. RAYMOND:: How much has the government paid in premiums on gold since it has prohibited exportation?


Mr. RHODES:: Since October 19, 1931, the marketing of non-monetary gold, including the current production of the Canadian mines, has been done through the medium of the government which has distributed to the mines and owners of such gold the net proceeds of the sale abroad.
Such sales to February 28, 1934, have realized 832,069,743 in excess of the standard value established by the Currency Act, after deducting all costs incidental to the export and sale.


ONION LAKE, SASK,, MEDICAL DOCTOR
Mr. McINTOSH:: 1.	When	was	Dr.	J.	T.	Hill	appointed
medical doctor at Onion lake, Saskatchewan, Indian agency?
2.	What has been his salary since appointment to date?
3.	When	was	Dr.	J.	T.	Hill	appointed
Indian agent at Onion lake?
4.	What has been his salary as agent since appointment to date?
5.	What are the names and present salary of other members of staff at this agency?
6.	Are any salaries herein subject to discount?


Mr. MURPHY:: 1.	April 2, 1923.
2.	Salary on appointment $2,000 plus house, fuel, light and rations. Increased to $2,120 April 1, 1927.
3.	July 1, 1932.
4.	$1,600.
5.	D. H. Cameron, clerk, Indian agency, $1,200 plus house, fuel, light and rations; R. C. Hamer, Indian farming instructor, $960 plus house, fuel, light and rations; F. M. Warne, Indian farming instructor, $1,200 plus house, fuel, light and rations; G. M. Malloch, Indian farming instructor, $960 plus house, fuel, light and rations; D. Vanasse, Indian interpreter, $900 plus house, fuel, light and rations; A. E. Peterson, dispenser, $120.
6.	All salaries shown above and value of allowances are subject to the provisions of the Civil Service Salary Deduction Act of 1932.
radio BROADCASTING-CANADIAN BROADCAST


Mr. MacLEAN:: 1. How	many broadcasting	stations in
Canada are using the programs of the Canadian Radio Broadcasting Commission?
2. How many broadcasting	stations in Canada are being paid for this service?
3.	What amount of money wms paid to each station since the inauguration of the service up to the end of January, 1934?
4.	Are any broadcasting stations in Canada using the programs of the Canadian Radio Broadcasting Commission and giving the same service as the other stations, but, not paid for said service; if so, how many?
5.	Are all stations that have a broadcasting licence compelled to use the programs of the Canadian Radio Broadcasting Commission whether they are paid for this service or not?
Questions


Richard Bedford Bennett: Mr. Speaker, I suggest to the
hon. member that that question be dropped. The select committee set up for the purpose of dealing with problems arising out of the administration of the Broadcasting Act will deal with just such matters as this one, and to discuss in this house a question which may be raised there is not conducive to the best interests of the service which the hon. member doubtless wishes to assist. I suggest, therefore, that the question be dropped, and that he deal with the matter through the committee.


Mr. SPEAKER:: The question is dropped.


IMPORTATIONS OF BUTTER FROM NEW ZEALAND
Mr. SEGUIN:: 1.	What quantity of butter from New Zealand entered Canada each year for 19281929-1930?
2.	What quantity of butter entered Canada each year for 1928-1929-1930 coming from Australia or any other country?


Mr. STEVENS:: 1.	The quantity of butter imported (entered for consumption) into Canada from New Zealand for the calendar years 1928, 1929, and 1930, was:
Calendar
years	Pounds
1928		 16,124,641
1929		 33,764,462
1930		 37,012,400
2.	The quantity of butter imported (entered for consumption) into Canada from Australia, or any other country, for the calendar years 1928, 1929, and 1930, was:
Calendar years 1928	1929	1930Imports from	pounds	pounds	poundsAustralia.. 629,944	274,400	1,422,512United Kingdom.	8,682	1,729,216	111,676United States.	..	38,352	148,051	58,922Alaska	
365	....Bermuda	45Fiji	
7,840	....Italy	
37	
....Jamaica	
33	
Netherlands	 2,205	

Newfoundland	
848	500Syria	
829	....


NEW RICHMOND, QUE., WHARF
Mr. MARCIL:: 1.	Has the Minister of Public Works been informed that the departmental wharf at New Richmond, Bonaventure county, is badly in 
need of repairs and until it is put in condition, pulpwood has to he carried to Maria or Carleton for shipment?
2.	If so, will any action he taken shortly in this respect?


Mr. STEWART (Leeds):: 1.	'It is reported to the department that the public wharf at New Richmond is in need of extensive repairs, and that to enable pulp-wood or lumber to be shipped over it extensive dredging would be required in addition to the cost of the repairs.
2.	Matter under consideration.


UNEMPLOYMENT RELIEF-ST. BENOIT JOSEPH LABRE D'AMQUI
[Stage Direction]
Mr. LaRUE:
1.	Has the federal government received from the government of the province of Quebec a request for the carrying out of additional relief works in the village and parish of St-Benoit Joseph Labre d'Amqui?
2.	If so, on what date and what was the amount involved?
3.	Has the federal government complied' with that request?
4.	If so, on what date, and on what date was the government of the province of Quebec advised of such compliance?
Mr. GORDON:: 1.	Yes.
2.	February 19th, 1934, $6,000.
3.	Yes.
4.	The schedule of works referred to was approved on behalf of the dominion by order in council P.C. 468 dated March 5th, 1934, and the province so advised on March 8th.


CANADIAN NATIONAL RAILWAYS OPERATING REVENUES
Mr. McINTOSH:: What are the gross and net operating revenues of the Canadian National Railways for each year since date of organization:	(a) for its
lines east of Port Arthur and Armstrong: (b) for its lines west of Port Arthur and Armstrong; (c) for its subsidiary lines west of Detroit and Port Huron; (d) for its subsidiary lines in the New England States?


Mr. MANION:: Mr. Speaker, we have not
that information in our department, but the whole information which we received is in the annual report which is to be tabled shortly. If the hon. member will look at the annual report, and if he does not get the information he desires he may write me a letter which I could pass on to the railway management.


Cameron Ross McIntosh: I thank the minister.

Questions


CANADIAN NATIONAL RAILWAYS-OUTSTANDING BONDS
*Mr. REID:: 1.	What are the amounts at par value of bonds outstanding on the Canadian National Railways system?
2.	What is the total interest payable annually on these bonds?
3.	What is the amount of the bonds held by private individuals?
4.	What amount of these bonds are held: fa) in Canada; (b) in the United States; (c) in other countries?
5.	Are any bonds held by railway corporations in the United States?
6.	If so, what amounts are so held?
7.	What are the names of the bodies corporate in Canada holding these bonds, and what amount is held by each?


Robert James Manion: The annual report, which
I shall table in a very few days, will contain most of this information. If the hon. gentleman will, after looking it over, tell me of any information that he does not find, I Shall pass on to the Canadian National Railways such requests as he may make.


UNEMPLOYMENT RELIEF-EXPENDITURES DURING A FIVE YEAR PERIOD
Mr. COTNAM:: How much money has been spent by the Dominion of Canada under the Unemployment Relief Act for the years 1930, 1931, 1932, 1933, and 1934?


Mr. GORDON:: The report of the Dominion Commissioner of Unemployment Relief setting out the federal assistance rendered to provinces and municipalities in their relief efforts, is now in the course of preparation and will be laid as hitherto on the table of the house in conformity with the provisions of the statute as soon as possible after the end of the fiscal year.


UNEMPLOYMENT RELIEF-PEMBROKE, ONT.
Ira Delbert Cotnam: What amount of money was expended' in the town of Pembroke, under the Unemployment Relief Act, for the years 1930, 1931, 1932, 1933, 1934, respectively:	(a) by the federal
government; (b) by the provincial government of Ontario; (c) by the municipality?


George Gordon: The Unemployment Relief Act, 1930-(a) $16,248.38; (b) $16,248.36; (c) $32,496.74.
The Unemployment and Farm Relief Act, 1931, and Continuance Act, 1932-(a) $17,877.77; (b) $17,877.75; (c) $32,877.77.
The Relief Act, 1932-(a) $14,669.45; (b) $14,669.42; (c) $10,784.14.
The Relief Act, 1933-(a) $17,591.54; (b) $21,989.39; (c) $13,193.67.
The figures shown under (b) and (c) represent expenditures to which the dominion contributed and are not necessarily the total relief expenditures of the province and municipality.


UNEMPLOYMENT RELIEF-EXPENDITURES IN TOWNSHIPS
Ira Delbert Cotnam: What amount of money was expended under the Unemployment Relief Act in the townships of Sabine, Lyell, Airy, Murchison, and Dickens, for the years 1930, 1931, 1932, 1933, and 1934, respectively:	(a) by the federal government;
(b) by the provincial government of Ontario?


George Gordon: No accounts have at this date been received from the province with respect to unemployment relief expenditures in the townships of Sabine, Lyell, Airy, Murchison and Dickens.


TRANS-CANADA HIGHWAY, PEMBROKE-MATTAWA
Mr. COTNAM:: 1.	What is the total amount of money expended under the Unemployment Relief Act for the construction of the trans-Canada highway, from Pembroke to Mattawa, for the years 1930, 1931, 1932, 1933, 1934, respectively: (a) by the federal government; (b) by the provincial government of Ontario?
2.	What was the total amount contributed by the federal government under the Unemployment Relief Act, to the federal constituency of North Renfrew for the years 1930, 1931, 1932, 1933, 1934, respectively?


Mr. GORDON:: 1.	Accounts received from the province covering expenditures on the trans-Canada highway do not set forth the expenditures by sections.
2.	The Unemployment Relief Act, 1930, $16,248.38; the Unemployment and Farm Relief Act, 1931, and Continuance Act, 1932, $17,952.87; The Relief Act, 1932, $15,062.07; The Relief Act, 1933, $17,817.08.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. MacINNIS:: 1.	How much grain has No. 2 elevator received and shipped during its operation by the Vancouver Harbour Commission for season 1933-34, until February 15, 1934?
2.	What was the total cost of operating No. 2 elevator from September 30, 1933, to February 15, 1934?
1598	COMMONS
Questions as Orders for Returns
3.	What was the amount for the following items:	(a) payroll; (b) interest on investment; (c) sinking fund; (d) amount chargeable to superintendency and all overhead?


Mr. DURANLEAU:: This question stands as an order for return, and I shall table any information I may receive from the harbour commission.



ASBESTOS EXPORTATIONS

[Stage Direction]
Mr. ROBERGE;
1. What was the grand total of asbestos exportations, year by year, since 1928 to date?
2.	What were the annual exportations of this mineral product since that date?
3.	To which countries were these exportations made?
4. What was the average annual cost of these exportations?
Mr. STEVENS:: Return tabled herewith.



TRADE COMMISSIONERS

Mr. McKENZIE (Assiniboia):: 1.	In what countries does Canada maintain trade commissioners and/or agents?
2.	What was the total trade of Canada with each of these countries in 1933?
3.	What is the cost to Canada in maintaining each of these commissioners and agents in: (a) salaries; (b) other expenses?


Henry Herbert Stevens: Return tabled herewith.



LOANS ON LIFE INSURANCE POLICIES

Mr. COOTE:: 1.	In the case of life insurance companies reporting to the Dominion Government Department of Insurance, what was the total amount of loans on policies in Canada on December 31 in each of the last ten years?
2.	What was the total amount of policies lapsed in each of these years?
3.	What was the total amount paid to policy holders and beneficiaries in each of these years?
4.	What was the total amount of premiums paid by policy holders during each of these years ?
5.	What was the number and value of
ordinary life insurance policies in force in Canada at the end of 1932, or nearest available date, in each of the following classifications: (a) under $1,001; (b) $1,001 to $2,000; (c)	$2,001	to	$3,000;	(d)	$3,001	to	$4,000;(e)	$4,001	to	$5,000;	(f)	$5,001	to	$10,000;(g)	$10,001	to	$20,000;	(h)	$20,001	to	$30,000;(i)	$30,001	to	$40,000;	(j)	$40,001	to	$50,000;(k)	$50,001 to $100,000;	(1)	$100,001 to
$500,000; (m) $500,001 to $1,000,000; (n) over $1,000,000?



CRAIN ELEVATOR TARIFFS

Mr. MacINNIS:: 1. What are the grain elevator tariffs in effect for the crop year 1933-34 at: (a) Mont-

real; (b) Vancouver; (c) Saint John; (d) Halifax; (e) Quebec; (f) Port Arthur; (1) for handling grain from cars or boats; (2) for shipping it out in cars or boats?
2.	Were any reductions on the grain elevator tariffs put in effect for handling grain via any of the above ports during the crop year 1933-34?
3.	At which of the above grain handling points are there government grain elevators operated by the government or by a board under the government?
4. At which of the ports mentioned in question No. 1 are grain elevators which have been constructed by the government?
5.	What is the full capital cost including
grain galleries, and all grain loading equipment appearing on the books of the Vancouver Harbour Commissioners, chargeable to:	(a)
No. 1 harbour board elevator; (b) No. 2 harbour board elevator; (c) No. 3 harbour board elevator?
6.	Are any Vancouver harbour board grain elevators leased to private grain firms?
7.	If so, to whom are they leased, and what are the rentals per year?
8.	Do Vancouver harbour board elevators leased to private firms pay civic taxes on the same basis as property used for a like purpose and privately owned?
9.	Are the grain elevator tariffs covering Canadian ports approved by the Board of Grain Commissioners?
10.	Has the government or any governmental body paid any civic taxes or any equivalent thereto on the dominion government grain elevator located at Port Arthur, Ontario?



MOTIONS FOR PAPERS


Mr. BRASSET:: For a copy of all pay lists in connection with work done on the breakwater at Ste-Adelaide de Pabos, Gaspe county, during the year 193334, and also copy of all letters, exchanged' between the Department of Public Works and any other person in connection with this said work.



SPIRITWOOD DISTRICT MEDICAL ATTENDANCE

Cameron Ross McIntosh: For a copy of all documents or accounts in the Department of Indian Affairs between the department and any person living in the Spiritwood district or elsewhere during the years 1933 and 1934 till the present time, in connection with the medical attendance given to the Witchekan and Chitek Indian reserves, located in the North Battleford electoral district.



SALMON EXPORTS TO UNITED KINGDOM

Mr. NEILL:: For a statement showing the export from Canada to the United Kingdom, both in weights and in money value of: (a) fresh salmon; (b) frozen salmon; (c) canned salmon, each shown separately, for the years 1929 to 1933 inclusive, each year shown separately, and showing

Tariff Board
whether exported from the Atlantic coast or from the Pacific. If the unit of cwts. is used, indicate the pounds content, and use the same standard throughout.



MR. AVILA BLOTJIN

Mr. GAGNON:: For a copy of all documents, letters, reports of inquiry, orders in council, if any, reports to the federal government or to members thereof, reports to different departments, with respect to the case of Mr. Avila Blouin, of the city of Quebec, who was wounded during the war.



CHANDLER STATION, GASPE, POSTMASTER

Maurice Brasset: For a copy of all correspondence, telegrams, and other documents in the possession of the government, dated from August, 1930, to date, respecting the resignation of Georges Molloy as postmaster of Chandler station, county of Gaspe, and the appointment of his successor.



TARDIF CHANNEL RETAINING WALL

Mr. BOUCHER:: For a copy of all contracts, letters and correspondence between the Minister of Public Works, the deputy minister, the engineers and officials of his department and all other persons, from 1930 to date, respecting the retaining wall along Tardif channel, at Notre-Dame de Pierre-ville, county of Yamaska.
.	COAL INQUIRY CORRESPONDENCE


Donat Raymond: For a copy of all correspondence exchanged between the Hon. W. A. Gordon, Minister of Labour, and the Attorney General of the province of Quebec, the Hon. L. A. Taschereau, concerning the inquiry held during the years 1932-1933 by Fred McGregor, registrar under the Combines Investigation Act, regarding the importation and prices of English coal.



TARIFF BOARD


[Stage Direction]
On the orders of the day:
Hon. W. D. EULER (North Waterloo):: Mr. Speaker, I should like to repeat a question which I addressed to the government last Monday based upon a report in the Ottawa Press which stated that the government had decided to refer to the Supreme Court the question of the right of the tariff board to make rulings in points of law and with regard to the validity of the fixing of values on goods imported under the British preference. I asked then whether the report was accurate, and I received from the Prime Minister a rather non-committal reply. In this morning's paper the report is repeated, stating that the government has so decided to refer such matters to the courts, and I
should like again to-day to ask the Prime Minister whether or not he can give a more definite reply in the matter.


Richard Bedford Bennett: The questions to which the hon.
gentleman refers are obviously questions of great difficulty. As a result of the appeal that was taken before the privy council, and which the privy council heard and reserved judgment, the formal conclusion that will be arrived at by the privy council will be communicated to those concerned, to the public and to this house immediately they have been finally settled. There have been many very difficult matters to be considered, and while in a broad way a conclusion has been arrived at I have no conclusion to communicate to the house at this moment, but I trust that some day during the present week I may be able to do so.



PENSION ACT AMENDMENTS

[Stage Direction]
On the orders of the day:
Mr. F. G. SANDERSON (South Perth):: Mr. Speaker, about three weeks ago I directed a question to the Minister of Pensions and National Health (Mr. MacLaren). The question was this: Is it the intention of the government this session to bring down any amendment or amendments to the Pensions Act. The reply of the minister at that time was that the matter was under consideration. Has he any further information to give to the house.


Hon. MURRAY MacLAREN (Minister of Pensions and National Health):: The answer is in the negative.



DOMINION ELECTIONS ACT

[Stage Direction]
On the orders of the day:
Right Hon. W. L. MACKENZIE KING (Leader of the Opposition):: I should like to ask the Prime Minister if it would be possible to have the legislation amending the Dominion Elections Act introduced some little time before the end of the session, and if possible before the Easter recess.


Richard Bedford Bennett: It will not be possible to introduce
the legislation before the Easter recess, but as soon as reasonably may be thereafter it will be submitted. At one time I thought it might be desirable to introduce a skeleton bill and have it referred to the committee on privileges and elections, but in view of the fact that so many members of the house are busily engaged on other committees I thought
1600	COMMONS
C.N.R.-C.P.R.-Joint use of Tracks
it more desirable that we should prepare the legislation, and it will be submitted to the house as early as possible after the Easter recess.


William Lyon Mackenzie King: Would it be
asking too much if I asked the Prime Minister, if without going into any detail he could indicate the lines of the proposed legislation?


Richard Bedford Bennett: I think the right hon.
gentleman himself would say that that is a rather unusual request.


William Lyon Mackenzie King: It is, yes.



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
Hon. R. J. MANION (Minister of Railways and Canals) moved the third reading of Bill No. 25, to ratify and confirm an agreement respecting the joint use by His Majesty and the commissioners of the transcontinental railway of certain tracks and premises of the Canadian Pacific Railway Company at Quebec.
Mr. JEAN FRANCOIS POULIOT (Temis-couata):: Mr. Speaker, I add my protest to that of the hon. member for Quebec East (Mr. Lapointe) and other hon. members who have spoken on this matter. The bill at first renewed the agreement for a period of 999 years, thirty years more than the age of Methuselah. It is a binding contract for a long period of years, and if I remember well the Minister of Railways himself suggested in reply to one hon. member from British Columbia that he was ready to accept an amendment making the term 99 years.


Robert James Manion: If my hon. friend will permit me, he is mistaken as to the bill. It was another bill that ratified an agreement for 999 years, and that bill has already received its third reading.


Jean-François Pouliot: I am very glad that the minister has rejuvenated the contracts that existed between the Canadian National and the Canadian Pacific. But may I draw to your attention, Mr. Speaker, the fact that the mail contract with the Canadian Pacific Railway represents a much larger amount than the contract with the Canadian National.
There is another matter which I wish to draw to the attention of the house. During the campaign the right hon. the Prime Minister, referring to the two main railways in this country, very often used the phrase "Amalgamation	never-competition ever."
Those words we have not forgotten. We trust that there will not be an amalgamation

of both these railways because competition is essential. I am not going to repeat what has already been said on that subject except to say that I regret that legislation. I believe it is wrong, and as I have already said, I add my protest to those that have already been made in this house on the matter.
Motion agreed to and bill read the third
time and passed.



SUPPLY-PUBLIC AND PRIVATE DEBT

[Stage Direction]
Hon. EDGAR N. RHODES (Minister of Finance) moved that the house go into committee of supply.
['That the name of Mr. Fraser (Cariboo) be substituted for that of Mr. Stevens on the select standing committee on banking and commerce.']
Mr. WILLIAM IRVINE (Wetaskiwin):: Mr. Speaker, before you leave the chair I desire to take the opportunity which this occasion affords to bring to the special attention of the house the matter of the heavy burden of debt, both public and private, which perhaps will never be paid either in this or in any other country, and I desire also to make suggestions in regard to possible ways of dealing with that heavy burden of debt. I shall deal with the question particularly from the point of view that the load of private debt as it now rests upon the people of Canada will greatly retard recovery from the present depression, and so long as that burden exists not only will recovery from the depression be difficult but no permanent prosperity is possible. I realize, of course, that it is only by the will of the government that any action can be taken in this house-


Richard Bedford Bennett: Perhaps the hon. gentleman will not mind my interrupting him for one moment. This matter was discussed by this house, Mr. Speaker, on an amendment to the address in reply to the speech from the throne. I have no desire to limit the observations which I always listen to with pleasure of the hon. member for Wetaskiwin, but I do not think the time of the house should be taken up twice discussing the same matter at the same session.


William Irvine: On the point of order, Mr. Speaker, before you give your ruling, I would like to draw attention to the ruling you yourself made on March 31, 1931. That ruling I think will very clearly show that I have the right on the motion for supply to raise a discussion of the question I am now bringing to the attention of the house. The ruling to which I refer was made in connection with a motion which was put forward by the hon. member for North Winnipeg (Mr. Heaps). He attempted in the first instance to move the adjournment of the house for the purpose

Debts-Air. Irvine
of discussing a certain matter, and he moved a resolution, but the right hon. the Prime Minister rising to a point of order pointed out that the subject matter of the resolution had already been dealt with by the house. But on that same day, when the motion for supply was made a little later on, the hon. member then brought the same matter up and again the objection was raised, but he was allowed to proceed with his discussion on the ground that he was not making any particular motion but was discussing a grievance before going into supply, and not only did he discuss the question but a very prolonged discussion took place.
I submit, sir, that we have a parallel case before you to-day, and it is inconceivable to me how the ruling you made on the date referred to could be altered on this occasion. Furthermore, let me say that I am not moving any motion to-day. I am simply taking advantage, as I said at the outset, of the opportunity which I understood was afforded to every member of this house before going into supply to present a grievance of the people I represent in regard to one of the most difficult problems they have to encounter to-day.


Pierre Édouard Blondin: The hon. member can proceed in the meantime and I will give a ruling later.


William Irvine: When the right hon. the
Prime Minister raised the point of order I was about to say that I realized it is only by the will of government that any action can be taken in this house with respect to either the question I have suggested or any other. It is not my purpose to-day to make an appeal exclusively to the government for I realize that the question of debt reduction implies the principle of contractual obligations and that is almost sacred to the economic system under which we now live. Before any action as drastic as that which would be necessary to be taken in respect to debt can be taken I imagine that we would have to have the almost unanimous support of every party and group in this house. I propose to make several suggestions as to how the burden of private debt may be dealt with and also indicate the principle upon which I desire to make my plea. I shall not move any amendment with respect to the matter because, as every hon. member knows, an amendment to the motion to go into supply is always regarded as a motion of want of confidence. Were I to move an amendment I would be defeating the object which I have in view rather than promoting it. If my intent in this matter were purely political,
no doubt that is what I would do, but it is not. While the present government along with all other previous governments must share the responsibility for not having changed the debt creating system, it cannot be charged with originating that system nor can we hold the present government responsible for debts which were contracted before it came into office. For these reasons, and also because the burden of debt is so heavy and so universal in its blight and its removal so fundamental to the recovery of this country from the great depression, I consider that this question should be dealt with without any blame being placed upon or favour granted to any party or group in this house.
The farming and labouring classes have suffered more than any other class during the present depression, chiefly because their incomes have dropped more drastically. While I mention these classes particularly I do not wish it to be understood that I am asking for legislation which would apply only to them. I mention them because I understand their position better and because it is my particular duty to represent them in this house. Our professional and business men are also overburdened with debt and their positions should also be taken into consideration. My proposal is that debt be reduced so that it may bear the same relation to the prive level which it did when contracted and that interest should be wiped out completely from the time the price level dropped precipitately until it again reaches the point where the major portion of the debt was incurred. Moral principles are very seldom applied, either nationally or internationally, except in rare cases When it is necessary to bolster up obviously immoral practices, nevertheless I do not propose to leave it out of consideration.


Mr. MORAND:: Would the hon. gentleman be prepared to reinstate the debts when prices come up again?


William Irvine: If my hon. friend will wait a moment, he will find that I shall answer his question in my speech.
I should like to examine the principle upon which the suggestions I am about to make should be considered. A contraction of a debt surely presupposes the stability of the income with which it is to be paid. If a man contracts a debt when his income is at a certain figure, surely it is understood that his income, whether from salary, from wages or from prices received for goods produced by him for sale, shall be fairly stable. It is absurd to expect a man to repay a debt when the basis upon which it has been contracted
Debts-Mr. Irvine

has been changed. The income with which a debt is to be paid is just as sacred as the contract to pay the debt. For if the income has been reduced or destroyed it is absolutely impossible to fulfil the contractual obligation. To create a debt and endow it with reproductive powers and then deflate and destroy the income of the debtor so that his property goes to the creditor is one of the greatest crimes which ever received the endorsation of the wise and the good. Where a debtor's income has been reduced by his own will, by his own carelessness, by his own inefficiency or even by misfortune, it may be both equitable and legal to hold him to his contractual obligations, but where his income has been reduced drastically or destroyed completely by a universal economic condition which he was personally unable to alter, then I suggest that it is only fair and reasonable that the contract should be reconsidered and readjusted to the new circumstances. Such debt adjustments should be made, particularly when the creditor stands to benefit from a calamity which has become not only national but as wide as civilization itself. Such adjustments become increasingly important when the creditor class has had a great deal to do, perhaps unwittingly, with bringing about the stoppage of the economic machine which has plunged the debtor deeper and still deeper into debt.
It is common knowledge that the farming and labouring people are almost in a state of bankruptcy at the present time. For example, let us consider the case of a mechanic working in the railway shops. Six years ago he put his savings into a home, costing about $4,000. After fifteen years of work he had managed to save $2,000. In order to purchase his home he had to borrow $2,000 at eight per cent interest. Assuming that he was able to save at the same rate for the next fifteen years, he would be able to save another $2,000 but he would have to pay $160 annually as interest on the $2,000 he had borrowed. His average savings for the first fifteen years had been only $133 per year so that the only way he could carry on is to save something from what he used to pay for rent in order to offset the extra interest he must pay. He starts out on that proposition but pretty soon he finds that his taxes are increased. Bye and bye he is put on short time and his income is reduced by one-half although the interest and taxes are still going up and being added to the bill he has to pay. Soon afterwards he is discharged from his position and has no income at all. After six years he finds that instead of owing $2,000, he owes 
$3,000, but he has no work and little chance of getting any. It must not be forgotten that he is six years older and even though work were- plentiful, it is altogether likely that a younger man would take his place. Such a man stands to lose everything and something should be done by this parliament at this session to assist our people in that position.
Let me turn to the farmer's position. Everyone realizes, surely, that farmers to-day cannot pay the debts which they contracted from fifteen to four years ago, from the prices which they are now receiving for the products they have to place on the market. Not only are the farmers not able to pay, it is impossible for them to pay. Those of my colleagues who may follow me in this discussion will place before the house comparative figures showing the drop in the capital values of agriculture as a result of the drop in the prices of agricultural commodities. Such figures will also show the impossibility of carrying on with things as they are, and will indicate the extent to which debts should be reduced.
I am reasonably certain that the majority of the members of this house expect the return of prosperity, and in such a hope they rest content, that when it does come back both farmers and labour people and others as well will be able to pay their debts as usual. I do not desire to enter into any argument at this time as to the possible return of the elusive nymph prosperity. For the sake of this discussion I am going to assume that she does come back. What then? She will come back to discover that the debtor's debt is larger than it was when she left; she will discover that the debtor is very much older and less fitted to meet the great struggle which he must enter if he is to survive; and we must all realize that the visit of the nymph the next time may be of much shorter duration than the last.
But there are other factors. For instance, it will take the added income of several years of prosperity to bring the farmer's stock and equipment to that point of efficiency at which it stood when the depression started, without paying anything at all on debts. Let me point out, before I pass on, one other consideration in respect to the farmer's position, and that is that the prospects of marketing for the farmers of Canada are less hopeful at this moment than at any other time in the history of the dominion. The capacity of human beings to consume certain commodities may be without limit, but their capacity to consume foodstuffs must be limited by the capacity of the human stomach.

Debts-Mr. Irvine
There is undoubtedly an oversupply at this moment of farm produce; not only so, but we have both the potential and the actual capacity to increase very much more that oversupply. So much is this so that steps are being taken to reduce production. And let it not be forgotten that from now henceforth the economic burden of agriculture will be all that it can bear, without assuming the pyramided debts of several decades on top' of present obligations.
Let me turn then for a moment to the common justice of the situation. Is it too much to ask that mortgage companies, bondholders and banks should assume their fair and equitable share of the economic losses which the people of Canada have sustained since the depression began? Is it fair that the income of people who receive wages, or of farmers who receive prices for their commodities should be less stable than the income of those who are paid interest on interest-bearing securities? Not only is the farmer's and labourer's income very much less secure, but the drastic fall in price levels, which paralyzed agriculture and increased unemployment and almost destroyed the purchasing power of the great masses of the people, increased correspondingly the incomes of those who receive fixed payments in the form of interest charges, because their income could buy very many more goods when the price level was low than could be bought with the same income previously. Surely therefore it is not unreasonable to ask that we reduce debts to the debtors of Canada to-day by as much as the creditors have gained through deflation, or by as much as the farmers and labour people have lost through the drop in wages and in the prices of agricultural products.
There may be some who will argue that debts will adjust themselves by the old favourite route of bankruptcy. Let me suggest that that course, no doubt inevitable in many cases if things go on as they are, is too haphazard, too unfair, too slow, too tragic, too disastrous. The situation is so serious in respect to debt at this moment that it demands a courageous, firm and immediate national policy. Apart altogether from the purely human factor of the matter and of common justice, recovery under the present debt pressure will be very much delayed if indeed not entirely prevented; for if farmers and labourers were to earn sufficient, under growing recovery, to escape foreclosure, which is all that they can expect even if prosperity does return, their money should not be allowed to flow into that stagnant pool,
because money that is paid for debt in times of depression is not reinvested, there being few opportunities sufficiently attractive to entice the investor. Therefore all debts paid during a depression shorten further the purchasing power of the people and result in further deepening the depression.
President Roosevelt, with his NRA and central bank, has so far failed to tap that stagnant pool and make it flow into the channels leading to consumption. I say therefore that even if we think that prosperity will come back and that debts will be paid it is essential that reductions should be made, because if we allow debts to be paid at the present juncture it will further swell the amounts of money which the bankers say they have and cannot lend because there is no safe demand for such loans. I suggest that if it were not for the anxiety of our creditors to protect their old investments we should very soon see a quickening in the economic and business life of the dominion.
Now there are various methods by which debts might be reduced, and I intend to mention some of them. Some of my colleagues will follow with examples from other countries indicating the extent to which such countries have reduced debts, and the methods they have adopted in doing so. To begin with, I propose that we wipe out interest entirely for the period of the depression, beginning at the date when the price level slumped precipitately and continuing from that period, until our price levels rise to bear the same relation to our debts that they had when the debts were contracted. The power to do that rests of course entirely with this parliament. There may be some constitutional doubts as to whether the power to reduce debts remains with the provinces or with this house. From my experience in listening to debates on the constitutional question in this parliament, it appears to me that the only way we can settle the constitutional doubt is to act and then allow the courts to decide the matter at leisure. Whatever course may be taken, let it not be said that both provincial and dominion governments did nothing and simply allowed the people to suffer because they could not decide among themselves which of the two had power to act. If it be clear which has power to act, let that be stated unequivocally so that the responsibility may fall where it properly belongs. If it be not clear, then let this parliament act and let the courts subsequently decide. Meanwhile the people will get relief and in due time the responsibility and the task will be placed upon the body to which they properly belong.
Debts-Mr. Irvine

But in matters of interest I suggest that there seems to be no doubt that the power rests in this parliament. When prices of farm produce dropped, then there was nothing left for the farmer to live on, let alone for him to pay interest on his capital. Is it fair that capital should have the first charge as against the farmer himself? Let us take as an example a farmer who has invested in part his own capital and borrowed the rest. There is no reason that the capital which the farmer risked on his own behalf should be treated differently from that which he borrowed from somebody else. But that is the situation. Surely hon. members will agree that the rights of capital should not be placed before those of the man himself. Let them stand on a basis of equality, if you will, although I think that is unfair. I believe the man should come first, but certainly let not debts come first. The claims of debt surely should not be taken before that of the individual who is struggling to make a living for himself and his family. I regard it as a rrime to compel a man who is unable to provide for his family, to pay interest to bondholders who have been reaping benefits from the depression. I propose, in order that that may be prevented, that all interest should be cancelled for the period mentioned.
With regard to debts which have piled up not only by the adding of interest compounded, but by the great drop in price levels, there are other methods of dealing with that. May I suggest as one method, that a moratorium be placed by this parliament on all past debts and to be removed when the price level warrants. I think it will be agreed that for obvious reasons it is inadvisable for a province to pass such an act, but the federal parliament did pass a moratorium during the war, and it apparently worked fairly successfully. There is more need for a moratorium to-day than during the war. While I am not arguing for this as the method that should be adopted, I mention it as a possible course to be taken and one for which there are ample precedents.
Another method which might be adopted is reflation of currency and credit. This is the most painless way of bringing about the desired result because people understand so little about money that if they get back the same number of dollars they put into the bank they seem to be satisfied regardless of the purchasing power. When the farmers' debts were increased by deflation twice as much as they originally were, the farmers did not know anything about the matter. It was only later they learned that it took two

or three times as much wheat to pay the same amount of debt. When a banker gets a dollar, he does not care whether it buys one or two bushels of wheat. What he is concerned with is how long he will have his hands on it and how much interest he will be able to charge for its use. The time has come when the people will insist that the important thing about a dollar is the amount of goods it can buy and I insist that the Canadian dollar in 1934 should pay the debt which a Canadian dollar contracted in 1918. That I claim is common justice and we dare not do other than that.
May I point out that reflation is not to be confused with inflation? The former is increasing the purchasing power until the price level reaches a desired point previously held, whereas inflation is increasing purchasing power beyond the value of goods upon the market, and if that is continued without any control, disaster is inevitable. While I believe a properly controlled reflation would be of great benefit to the debtor class in Canada to-day, I do not now advocate nor have I ever advocated uncontrolled inflation.
Another method by which debts might be reduced is by statute law to cut all debts by a fixed percentage. This I believe to be the honest, courageous, most direct and easiest way to meet the difficulty. I know a government will think very seriously before taking action so drastic and unusual, but the economic conditions of Canada to-day are so drastic and unusual that they must be met with drastic and unusual acts. I do not suggest that the government should assume all the responsibility. Every party in the house should indicate its willingness to take action of that sort in the interest of all the people of Canada. My hon. friends may disagree with the suggestions which I have made and I am prepared to hear the old argument about impracticability. These proposals may be impracticable, although I do not think they are. I shall not argue their merits now, beyond saying that not one of the things I have proposed is nearly as impracticable as it is for us to try to carry on without making a reduction in the personal debts of the Canadian people. Further, the suggestions that I have made have not been offered as cures or rather as solutions of the national problem. They have been offered rather as a remedy for a very sick patient. There is no true remedy for these debt conditions except the introduction of a new financial system on a non debt-creating basis. But I am not married to the suggestions I have made. If hon. members can make better ones, let them make them and gladly shall I accept them.

Debts-Mr. Coote
Let me draw attention particularly to what is to be done. We must bring debts within the limits of the debtor's income. We must compel those who obtain their income from interest-bearing securities to assume their share of the economic loss caused by the great depression. This is the bare minimum of justice and I care not how the government or parliament may decide to do it as long as it is done. It would be easy for me to demand that the government at this moment state its policy with respect to this question. It would be even easier for the government to declare that its policy was one of having nothing to do with altering contractual obligations. But knowing how difficult it is to arrive at a proper policy on a question of this sort and how dangerous it is to have no policy at all, I in all humility and sincerity suggest that if the government has not already decided what it is going to do in this case, it should appoint a special committee of the house representative of all parties, to canvass the whole situation in respect to debt reduction, as to the practicability of reducing it, as to the amount by which it should be reduced and as to the method which should be adopted to do so, and that such committee should report in good time so that action may be taken during this session of parliament. That proposal, I suggest, is reasonable and just.
The situation with which we are now confronted is impossible if debts are not reduced. If debts are reduced not only will it not harm the creditors; it will really assist them, for with their power of controlling money they can make more in a year under prosperity than they are going to lose by the cut in debts which will have to be made. Above all we would give hope to a hopeless people if we took action of this sort. Let the farmers and the debt burdened people of this country realize that the whole nation is going to bear its share of the economic losses that have been sustained and that they are going to have an opportunity of emerging from their present condition; then hope will be revived and recovery speeded up very greatly.
I leave the matter to the wisdom of parliament, repeating only the substance of one thought which I expressed earlier in the course of my remarks. This question of debt, with its urgency and its vital effect upon the nation, is above all partisanship, and I fully believe that every hon. member will so regard it. I conclude by making reference to a remarkable speech delivered in this house a few weeks ago by the hon. member for Labelle
(Mr. Bourassa), the fine spirit and appeal of which were felt and responded to readily by all who heard him. He said:
I submit that neither party would endanger its chances of victory by making some concessions, by trying to create an operating understanding among all parties with regard to a few questions, because thereby they would enhance the confidence of the people in the sincerity of each group, and also do something to restore, what is badly needed, the faith of our people in our parliamentary institutions and in our parliamentary governments.
I regard this matter of debt reduction as one of the matters upon which it might be possible for us to arrive at an operating understanding. If we can do so I believe we will enhance the opinion of the people as to this parliament, because of the good that will be done in a general way to all the people of this country.


Mr. G. G. COOTE (Macleod):: Mr. Speaker, before you leave the chair I should like for a few moments to support the request made by the hon. member for Wetaskiwin (Mr. Irvine) that the government deal with this most difficult problem of debts and interest. About a year ago one of the most prominent statesmen and thinkers on this continent, Senator W. E. Borah, made the statement that industry and business were being strangled by fear, by debts, by high interest rates and by the high taxes being raised in an attempt to carry those debts. About the same time Professor Irving Fisher, an outstanding economist of Yale university, said the United States was suffering from the debt disease, coupled with what he termed a dollar disease, or a bloated dollar. Debts in the United States are said to have increased from $115,000,000,000 to $234,000,000,000 during the period from 1920 to 1929. We have no reliable figures for Canada, but I suppose we might safely estimate the total debts in Canada at about $15,000,000,000 to $18,000,000,000 in 1929.
It should be noted that the years during which we had the greatest prosperity in Canada were the years in which we were piling up this immense debt. We had apparent prosperity because we were making use of abundant credit, and under the present system credit is just another name for interest bearing debt. By this time we should have learned also that it is not the size of the debt that matters so much as it is the rate of interest on the debt, together with the price level of goods produced and the level of wages and salaries being paid to the people. So far as wage earners and salaried people are concerned, the interest on their obliga-
Debts-Mr. Coote

tions can only be paid if the salary or wage leaves a margin over their living costs, and I may refer to this a little later when I
speak of the ability of the wage earner to pay his debts.
In the final analysis, Mr. Speaker, interest is paid out of production. When prices fall below production costs the payment of interest by producers becomes impossible. That is why for so many years we have advocated in this house a money policy managed so as to maintain stable price levels and stability of employment, as well as of wages and salaries. In the years 1929-30 there occurred an absolute collapse of prices, and in 1931 we in this corner urged the abandonment of the gold standard and the lowering of the value of our dollar in gold countries so as to raise price levels in Canada particularly of export commodities; in other words we urged that we should hold up the price level and in fact restore it to the point at which it stood in 1926. Had this been done at that time I do not think it would be necessary to-day for us to urge the government to take some action looking to the reduction of the debt and interest burden.
Since that time we have not ceased to urge that policy, but so far the government has turned a deaf ear to such proposals. The financial policy of Canada has been one of consistent deflation, with consequent low price levels. This is well illustrated by the fact that in the fall of 1932, wheat was at Hie lowest point it ever reached since it has been grown in western Canada. Taking 100 as the index figure for 1926, the index figure for field products reached a low of 35 in January, 1933. The index figure for all farm products reached 43 in that month while the index figure for all commodities, or in other words the wholesale price index figure, stood at 63. I think it would be fair to say that the consistent policy of the government has been to maintain our dollar at a high level in New York. The reason given for this policy was to make it easier for governments and others owing money in New York to purchase the foreign exchange with which to meet their liabilities; in other words it was considered to be in the public interest to keep our exchange rate down. This resulted in low prices in terms of Canadian currency for all our exportable products, and these low prices have been the cause of the tremendous volume of unpaid debts, interest and taxes which exists to-day. Surely this is ample justification for us to ask now for national action to reduce interest rates and to deal with this burden of accumu-

lated interest and taxes. We are only asking for justice.
I think at this point it would be quite worth while to quote the Prime Minister himself, speaking at the imperial conference in Ottawa two years ago. I quote from page 116 of the proceedings:
While nearly all other types of prices have been declining more or less rapidly, we have seen a significant rise in taxes-federal, provincial and municipal-and in interest rates or the cost of capital. The Canadian indicator of the yield on high grade, long term bonds has risen from 93*9 in December, 1930, to 113-2 in May, 1932. In January of this year a high of 119-8 was reached.
Interest charges represent the most important of the fixed or semi-rigid elements in our cost structure. If prices remain on their present level, such charges will constitute an intolerable or almost intolerable burden in many cases. Even if it can be borne, the fortuitous gain to the credit of 40 to 48 per cent in general purchasing power above what he contracted for appears to be a grave injustice.
If we are to give justice to-day I am sure the interest burden should be adjusted to existing price levels. Had we taken the proper action in 1930 to raise prices through our monetary policy; had we allowed the value of our dollar to fall in outside countries it might not be necessary to-day to reduce debts and interest. But failing that action at any time during the past three years it is evident that now we must reduce interest rates and perhaps in some cases write down the debt or reduce the accrued interest.
I should like to make it clear that it is failure to maintain stability of price levels in Canada that makes this action necessary. The currency of Australia was depreciated and interest rates were reduced under what was called the premier's plan. As a result of this, in the fall of 1932, due to the higher price levels caused by depreciation of their currency, and due also to the reduction in interest rates to which I have referred it took only 100 bushels of wheat to pay t'he interest on a SI,000 mortgage for one year drawn at eight per cent, while in Canada in the same month it took 200 bushels of wheat to pay the interest on $1,000 mortgage drawn at eight per cent.
There is another very good reason for asking for action to reduce debts and interest. It would be good business for Canada to do it. It is universally admitted that a writing down of international debts is absolutely necessary if we are to restore world trade. By the same line of reasoning, if we are to restore business here action should be taken to adjust this internal debt situation. There can be no pros-

Debts-Mr. Coote
perity until some adjustment is made. I think that in the interests of the creditors themselves some action should be taken. It should be taken in the interest of widows and orphans where, in many cases, their income has been stopped, due to the inability of the debtor to pay his interest. Some action should be taken in this connection. I have had several cases brought to my attention of widows, who were dependent upon the interest from real estate mortgages and the rentals from farms, who have been left without incomes during the last two years.
There is also a third reason. I think it is necessary from a national or public standpoint, as well as from a private point of view. Our revenues, which in the years 1928 and 1929 were very buoyant and reached the figure of $455,000,000 have shrunk to $306,000,000 for the year 1932-33, leaving us with a budget deficit of $150,000,000 for last year. Had our revenue remained at the 1928 level our budget would have been balanced in the past year. But since the government refused to adopt a money policy which would restore price 'levels to the point at which they stood in 1926 or 1928, or anything like it, our budget can be balanced only if there is a large reduction in the burden of interest on the public debt. Interest on the gross debt and guaranteed obligations represents nearly fifty per cent of our budget. The budgets of our various governments throughout Canada, provincial, federal and municipal, reflect the financial position of the taxpayer. In the last four years their ability to pay has been more than cut in two, and in many cases it has absolutely disappeared. Relief for the taxpayers has become imperative, and this can be given only if we are prepared to take action to reduce interest rates.
I wish now to deal with the question of the ability of our people to pay taxes and interest. After all, if this interest is going to be paid it has to come from the great mass of taxpayers. I wish first to deal with the ability of the wage earners and salaried people to pay, and as an example I shall turn to our own Canadian National Railways. In 1929 these railways gave employment to 111,000 people, and in 1932 to only 77,000. In the meantime 34,000 had become unemployed and had lost all ability to pay. In 1929 the wages paid amounted to $177,000,000 and in 1932 they were only $106,000,000, so that there is a reduction in wages in this one institution alone of over $70,000,000. On the other hand during those three years the interest paid by this country on the railway bonds increased from $45,000,000 to $57,000,000. That is an
increase of $12,000,000. If hon. members will compare the figures of the year 1923 with those of last year they will find the increase is very striking. In those years the increase in the interest bill amounts to $22,000,000, while in the same years wages declined by $52,000,000. This is probably a very good illustration of what happened in regard to the wages and salaries received by the people in Canada generally.
I want next to deal with the paying power of agriculture, and in this connection I should like to remind the house that during the war the federal debt increased approximately seven times. Clearly, the larger part of our direct federal debt consists of war loans. Sir Thomas White, Finance minister at the time of the war, is reported to have said in connection with the flotation of one of the last victory loans that if these loans were ever to be repaid it would be from the top six inches of Canada's soil. Sir Thomas quite evidently realized that interest is paid out of production. Agriculture is our greatest industry, and I wonder just how much interest agriculture can pay to-day. What contribution can agriculture make to the interest charge on the national debt?
I have before me a few figures which will serve very well to illustrate the situation. The total of the gross debt of Canada and loans guaranteed by us as to principal or interest is as follows:	In 1913, the figure
is $483,000,000; in 1928, $3,361,000,000; and in 1933, $4,020,000,000. That is an increase from 1913 to 1933 of about $3,500,000,000. In those three years the net debt stood as follows: In 1913, it was $314,000,000; in 1928, $2,296,000,000 and in 1933, $2,651,000,000. The interest on the direct debt for those three years is as follows: In 1913, $12,000,000; in 1928, $124,000,000 and in 1933, $134,000,000.
Last year, in addition to that $134,000,000, we paid $53,000,000 as a deficit on the Canadian National Railways, all of which went for interest. I should like hon. members to compare the interest charges paid by the federal government of Canada in the years 1913 and 1933 with the gross agricultural revenue of Canada. The interest increased eleven times between the years 1913 and 1933, not counting the Canadian National Railways deficits, and the gross agricultural revenue of Canada was less in 1933 than it was in 1913.
I ask hon. gentlemen how we are going to continue to pay existing rates of interest on the debt. May I give now the total value of field crops produced on the farms in Canada for the three years I have mentioned. They are as follows: In 1913 the total value

Debts-Mr. Coote

fanning and labouring people? Should not our job be to bring about an equality between the wages of money and the wages of the people? We are revering interest rates and disregarding human rights. Mr Cromie, the editor of the Vancouver Sun, is reported to have said recently:
"When we from Canada and the United States," he said, "visit India and see that poor starving country feeding about 10,000,000 sacred cows, sacred crows and sacred monkeys, we wonder how humans can be no ignorant and stupid. But when from the shores of India we look back at our own North American continent, we see in perspective how foolish we are with our sacred cows of overcapitalized debts, high interest rates and outlived social attitudes which cause some of our people to go without work and some to starve and to be without hope of the future."
I implore the government to regard debts as being a little less and our people as being a little more sacred. I entreat the government to take some action in this connection. If it has no definite proposal to make in this regard it should follow the suggestion made by the hon. member for Wetaskiwin (Mr. Irvine) and appoint a small select committee to consider this most difficult problem.


Mr. H. E. SPENCER (Battle River):: figures with regard to the average revenue received by the farmers to-day. I find that hope is disappearing, because the young people coming out of high school and college to-day who are lucky enough to find work are few and far -between. They have no means whereby to set up for themselves and they cannot borrow from the banking institutions. I find that others who have gone through the common schools cannot go to high school or university because their parents simply cannot afford to send them. This sort of thing cannot go on without affecting business, and business generally recognizes it to-day. That is why it is felt that until agriculture is again on a paying basis no general uplift of business can be brought about. If agriculture is allowed to remain in its present precarious condition or to become any worse, it is going to be an evil day indeed for general business throughout the country.
Anyone who has studied the subject of interest must appreciate the tremendous liability it is to those who are so unfortunate as to be unable to meet their payments. I have in my hand a statement taken from Mr. J. M. Keynes' book Monetary Reform in which he says, referring to debts, that if they are allowed to grow without mitigation for many generations, half the population would be no better than slaves to the other half.
The ex-Chaneellor of the Exchequer, Mr. Snowden, referring to the huge amounts Great Britain has to raise every year by taxation to meet interest on war bonds, said one day to the British House of Commons that the British government to-day was practically a huge tax-collector collecting from all the people huge sums to turn over to a few who happened to hold war bonds.
Let me go back further in history to a statement made by Napoleon Bonaparte who in his time was a great student of these questions. In that very well known book by McNair Wilson, Monarchy or Money Power, Napoleon is referred to as fighting the monetary interests right until the time he was shut up in Elba. At the time he escaped, when he had to get some money quickly, he sought the international moneyed people and borrowed from the city of London five million pounds with which he equipped himself to fight the battle of Waterloo. He is reported to have said in looking at a table of compound interest:
I wonder if this monster has not devoured the whole human race.
Were it not for the fact that from time to time we have bankruptcies galore and a

writing down of interest every now and again, there is not the slightest doubt that the control of properties in general would come into the hands of a very few people.
A year ago the house sent to the banking and commerce committee a resolution introduced by the hon. member for Red Deer (Mr. Speakman) asking for an investigation into debts and interest. Some valuable work was done in that committee and a great deal of important information obtained by it. Time, however, did not allow it to go into the question as thoroughly as it desired, and so, in submitting its report to the house, it recommended that the work should be continued. I trust, therefore, the government will accede to the request of the hon. member for Wetaskiwin who has brought up this subject this afternoon, and will appoint a special committee to go into the whole question of debt and interest and to see whether something cannot be done, as I am sure it can, to help to salvage business from the extraordinary position in which it finds itself, to enable this country again to step on to the highway of success, and to get away from the very low standard of living and the debt and worry through which most of the people are passing to-day, to a much higher level or improved standard of living to which we can look forward with a great deal of hope and pleasure.


Mr. W. T. LUCAS (Camrose):: Mr. Speaker, I wish to make a few observations in support of what has already been said on this very important question of debt. I believe there is no question in Canada to-day that is causing so much worry and so many sleepless nights as the tremendous burden of debt that is weighing so heavily upon the Canadian people. May I say here that if this session of parliament did nothing more than deal adequately with the debt problem, it would have done something really worth while.
Speaking a little over a year ago, Mr. Stanley Baldwin made the following remark:
These clays constitute a challenge to our genius, industry and loyalty. The world stands upon the precipice of bankruptcy while in possession of the secret of plenty.
I am sure that one will not be considered an extremist in quoting any remarks made by the Right Hon. Mr. Baldwin. Last year the hon. member for Red Deer (Mr. Speakman) introduced a resolution dealing with the question of debt, and this resolution was later referred to a committee of the house. I find at page 623 of the Journals of the House, 1933, that that committee reported giving the dominion, provincial, municipal and corporation debt as $8,855,596,829 and the total

Debts-Mr. Lucas
interest for the year, figured at an average of 4-77 per cent, as $421,965,896. When we find that the total amounts realized from the field crops of the whole dominion amounted last year to only $422,148,000, we realize that this is practically all taken up in meeting interest on our dominion, provincial, municipal and corporation debts. On top of those figures farm mortgages were estimated at $677,564,100. Might I say that there was some difference of opinion in regard to those figures because they were computed only from mortgages given by those who owned land, whereas we from the west know that a large proportion of our land is sold on crop payments and agreements of sale and as the holders of these agreements are not really the registered owners of the land, the amounts owing on those properties would not show. Then urban mortgages were estimated at 8765,000,000, if we combine farm and urban mortgages, we have a total of $1,442,564,100. If we add this to the dominion, provincial, municipal and corporation debts, we get a total of $10,298,160,929. But no estimate was made of the private debts of Canada and while a number of estimates have been given, I would simply add as private debts, $1,700,000,000 to this figure, bringing the total to approximately $12,000,000,000. The hon. member for Red Deer in a very careful compilation in his speech of last year estimated the total debt at $12,000,000,000, but there are those who place the figure very much higher. If, however, we take $12,000,000,000 as the total debt of Canada, at an average interest rate of 6 per cent this would give us a total of $720,000,000 a year in interest charges. Dividing this by 12 it means that our interest rate per month amounts to $60,000,000, or that we are paying $2,000,000 each day of the year in interest charges. When one considers these figures one realizes why we are in the condition in which we find ourselves to-day. One must remember that these debts were largely contracted when prices were at a very much higher level than they are at present, and I think it would be safe to say that at present price levels one could at least double the figures I have already given. The paradox of the whole thing, Mr. Speaker, is the fact that never were we so wealthy as a nation, yet never were we so hard up. I should like to quote Doctor Victor Dalmage, chairman of the British Columbia Mining Institute, from the Canadian Mining and Metallurgical Bulletin of January, 1931. He said:
The economists define wealth as "the fruits of labour" such as, for example, wheat, copper, cotton, lumber, fish, etc. According to this definition, the world is at present flooded with
wealth and yet, at the same time, awful poverty is everywhere in the land; people are hungry, ill clad, and ill housed even on this, the richest of continents, and in this young and vigorous country of ours.
Just stop for a moment and remember that if every dollar in the world disappeared tomorrow morning not a bit of this wealth which is essential to the well being of mankind would disappear with it, yet because of the present man-made money system we find ourselves in this terrible condition. I think we might as well admit that we are bankrupt so far as our ability to pay our present debts is concerned; not only that, but it would appear that to-day all governments are bankrupt of ideas as to how to meet the situation. When the provincial premiers met in Ottawa in January, just before the session opened, I found the following statement in the press:
"No matter what avenue we explore in taking up the agenda items, we always bring up against that stone wall-financial stringency," said one provincial premier on leaving the conference last night.
When one considers the wonderful resources of our country and our tremendous ability to produce, one is forced to the conclusion that the only barrier standing between the ability to produce and the desire to consume is a financial one. In a short article in the Business Week of New York, I find the following statement:
In the course of time we shall understand that this depression had its origin and will have its end in other, more fundamental factors than the management of individual industrial and commercial enterprises. Of these, our monetary and credit system and our governmental machinery are the most important. Both are a century or more behind business in their development. Management can do only so much and no more to offset their deficiencies, and the stable progress of business is limited by them.
Reading the press to-day one is struck with the statements that are made as to the inevitability of another war. I am sure that if a plebiscite of the people of the world could be taken no private individual would vote for war, yet because of the debt-ridden condition of the people and the economic situation in which they find themselves they are gradually being forced against their will into another war. I think every hon. member realizes just what another war will mean to civilization. In his Inversion of Science, Professor Soddy has this to say, at page 15:
Anticipating somewhat the conclusions to be arrived at, we may define here the cause of war more precisely as due to an accumulation of mutual international indebtednesses without any possible method of repayment. Strong nations at once get the weaker into their debt
Debts-Mr. Maclnnis

and prefer to extort from them a permanent annual tribute of wealth by way of interest, rather than to allow them to repay the principal and go free. War cannot be abolished till that is rectified.
I am convinced, Mr. Speaker, that under our present debt-creating system this problem cannot be dealt with. As I said a few days ago when speaking of another matter, just as t)he industrial revolution which occurred a little over one hundred years ago changed the whole outlook and condition of mankind, so to-day I am convinced that nothing but a financial revolution will meet our present needs. It seems so absurd, when we find ourselves surrounded with plenty on all sides, and when we have the ability and willingness to produce, that we should find ourselves in our present condition. We have everything but the ability to provide the tickets of exchange ; the one obstacle is a matter of finance, and until we are prepared to use our social credit for the benefit of the people instead of allowing private interests to use it as they are now doing, I see nothing but trouble and chaos for the future.
I wish to add my voice to those who have requested that this matter be sent to a committee and given very careful consideration. I hope this session will not end before at least something has been done in regard to the debt question.


Mr. ANGUS MacINNIS (Vancouver South):: Mr. Speaker, I did not intend to say anything on this question until I heard a certain statement made by the hon. member for Macleod (Mr. Coote). The hon. gentleman referred to the fact that it was quite noticeable that in times of economic prosperity debts increased faster than in times of depression. The point I am going to make is very important, and I hope hon. members will take some note of it. I do not ask that they agree but I do ask that they give the matter consideration, and if they do so I am quite satisfied that they will come to the conclusion that debt is inseparable from the present system. As a matter of fact capitalism itself is debt. It was reported some time ago that an eminent European statesman said that empire was debt; I say that capitalism is debt.
Now let us see why it is that in times of prosperity debt increases faster than in times of depression. I do not know, but I presume that when the hon. member for Macleod referred to times of prosperity he was referring to the years immediately preceding the depression which began in 1929 or 1930. If we go a little farther back to some years preceding that, at a time when there was a still

greater industrial development and industrial activity-I refer to the years of the world war-we find that debts increased not only at the same rate as they increased in 1929-30, but considerably faster. The reason is this: There was more wealth produced, although it was destroyed as fast as produced, during the war years. There is only one way in which a certain amount of the wealth produced under capitalism can be disposed of, and that is by creating a debt equal to the value of that part of the wealth produced.
Production is disposed of in two ways. It is shared between the owners of the capital concerned in its production and the workers in that particular industry. Through wages the workers receive a certain amount of the value they produce, but they do not receive sufficient to buy back the total volume they have produced. The employing or owning class are not able to consume the surplus that the workers have produced and cannot buy. There is no way then, in which that surplus can be disposed of, except by creating a debt. If we go back, as I said, to the years immediately preceding the war, when the United States was lending enormous sums to the allied nations, we will find that the workers in the United States, in fact all the people in that country, were living on a higher standard than they had ever lived on before. That condition meant one thing only, that they were producing enough to feed, clothe, and shelter themselves better than they had been fed, clothed or sheltered before, and yet they were creating a huge surplus of commodities to send overseas. All of that was creating a debt.
Some little time ago I saw an article in World Wide, which was copied from the New Republic.' The article was intitled "A War Debt Catechism," and reads in part as follows:
Q. What are the war debts?
A. Debts owed to the United States government by our allies in the world war, for loans made to them during and after the war.
Q. How much were the total loans?



[Stage Direction]
Q. How much was loaned before the armistice?

[Stage Direction]
Q. How was the money sent to Europe?
A. The money was not sent to Europe. It was paid to American manufacturers, farmer? and other business men by a committee of the American War Industries Board.
Q. What for?
A. Munitions of war, food, cotton and other supplies sent to our allies; transportation, shipping, interest.
Q. How much was loaned after the armistice?
A. $2,500,000,000, plus $740,000,000 in relief supplies.

Debts-Mr. Reid,
Q. How was this after-the-armistice money sent to Europe?
A. It was not sent to Europe. It was practically all spent in the United States for the purchase of war supplies, cereals and cotton sent to our allies.
Q. Why were these loans made to the allied powers after the armistice?
A. The principal reason given by the secretary of the treasury was that these loans would enable American business men to complete their war-time contracts with the allied powers. If these contracts were suddenly cancelled, he said, it would have an injurious effect upon American business.
All these debts have been created by the exchange of material things, the exchange of goods, and they can never be paid unless those who hold the debts will take goods in exchange. That is the condition with which this country is confronted, and the process I have explained is one which those who owe debts cannot possibly follow. The creditors cannot accept the millions of bushels of wheat offered by the prairie farmers; they cannot . accept the beef or pork or mutton, or any of those commodities which we can produce in such abundance; they cannot accept the services of those people who are willing to work. Consequently because these debts cannot be paid we have in Canada to-day 20,000 able bodied men who could be our greatest producers of wealth, but who are in idleness in slave camps. I do not wish to say any more on the subject.
iMr. MACKENZIE (Vancouver):	More
than that; the hon. member has not taken the national parks into consideration.
Mr. MacI'NNIS:	I do not wish to say
anything further in connection with this matter. I hope the government will send the matter to a committee and, as I said before, if that committee will give it careful consideration it will come to the conclusion that the world's debts and Canada's share of those debts cannot be paid. Possibly then we will get down to business and use some of the wealth which we have and which we are so eminently fitted to produce.
Mr. THOMAS REID (New Westminster); Mr. Speaker, in my opinion the suggestion offered by the hon. member for Wetaskiwin (Mr. Irvine) is one of the best suggestions which has been made during this session of parliament. I believe every hon. member will agree that the debt situation in Canada- and it is this country in which after all we are particularly interested-is an enormous burden, and is one too great for our people to carry. Listening to the figures offered by previous speakers one could not help but feel staggered by the facts as to the debt
situation in Canada. I agree with hon. members when they say that it is doubtful if the debts of Canada will ever be paid. While someone might ask, " Well, what are you going to do about it?" I want particularly, without answering the question at the moment about debts, to deal with the question which is troubling most of us, namely that of interest.
I do not intend to cover the ground already touched upon by previous speakers, nor do I intend to place upon Hansard again the many figures concerning the debts of Canada. The matter is so serious however that I do not believe it should pass this chamber until a greater number of speakers have taken part in the discussion and have given expression to their views concerning the acute situation facing us in Canada. Not only are thousands of our people faced with the burden of debts, with the loss of their homes, and so on, but they are faced with the loss of insurance policies and, in fact, everything that they own. Those who were fortunate enough to invest their money in bonds have been protected all the way along. But the farmer, or those other individuals who have placed their money and their all in homes or in farms are seeing all they possess wiped out. I believe it is safe for me to say that thousands of people have already lost not only their homes but their other possessions.
I should like at this time to deal particularly with the staggering debt facing the province of British Columbia. May I at the outset say that I am not blaming any particular government for the situation in that province, but when one considers that in a province of about 700,000 people we are faced with a debt of almost $167,000,000, is it any wonder that many of our people are wondering whether we will ever emerge, or whether it would be better to default now and to begin all oyer again. I have jotted down some figures in connection with the province of British Columbia and to say the least, they are startling. They borrowed $42,000,000 to cover deficits alone. Out of a total expected revenue of S19,492,791 this year, the interest charges amount to almost $8,000,000, and sinking fund amounts to another $3,758,701, making a total of Sll,663,086, which has to be taken from that expected revenue of just over $19,000,000. That leaves somewhat less than $8,000,000 with which to carry on the whole affairs of the province, such as education, health, hospitals, charities, old age pensions, mothers' pensions and aid to the municipalities, public works and all other public services. Taking into account the costs I
Debts-Mr. Reid
[Stage Direction]
have mentioned, it leaves less than $1,000,000 with which to carry on all the other affairs of the province.
I think some measure of condemnation is due this government for not meeting the wishes of the province of British Columbia and endeavouring to help them refinance or refund their loans. I understand that the province has approached this government and asked to be allowed to go to the London market, but that the request has been refused. The province has now indicated that it is not its desire to default on the carrying charges, but the enormous load of debt has become so burdensome and has reached such a crisis that the province has now intimated that it will refund at a much lower rate of interest. According to figures submitted by the provincial Minister of Finance, if the province can refund its present debt at something like three per cent, as it expects to do, it will mean a saving in the neighbourhood of $5,000,000 a year in interest charges to the people of that province.
For the benefit of the house I would like to put on Hansard a few figures as given by the president of the North American Life in regard to the debt of this country. It shows the saving that could be effected were the interest rates reduced on the debt of this country. First they give the total debt of the various provinces last year, aggregating $1,142,666,557. They say that if the interest rate were reduced to only 34 per cent it would mean a saving of over $15,000,000 on that total debt. When one considers that almost every other country in the world has had a refinancing and a refunding of its debt, some countries refunding as low as 24 per cent, one cannot help wondering what is keeping this country back and why no steps have been taken here to refund the public debt at a much lower rate of interest.
I know that the government endeavoured to take a great deal of credit, and perhaps some credit was due, for the first refunding loan which they floated in London, but I would point out that that loan was floated at 4 per cent. On the other hand, Australia, whose currency has been depreciated and whose financial position has often been quoted in this house, this last year floated in the London market loans amounting to $500,000,000, some as low as 2J per cent and the average at 34 per cent. If that can be done by a country like Australia, with a depreciated currency, what can be done by Canada which has stood these last three years on what is termed by the Prime Minister a sound money policy? Surely if that can be done by these other countries

with depreciated currencies, Canada can and should do just as well.
Many suggestions have been made, and I am going to make a suggestion now which I feel is pertinent, although perhaps it might more properly be brought up at some other time, and that is regarding the turning over of all our gold to the central bank. I think it would be a mistake if the gold was turned over to the central bank without this country first of all getting the profit, because otherwise, with gold at $20.67 an ounce, we would lose in the neighbourhood of $90,000,000. The gold in the banks at the present time amounts to well over $40,000,000, and the treasury, under the Finance department, has over $70,000,000. If you add those two together they amount to 60,000,000 ounces of gold, which, at $15 an ounce, representing the difference between the price of $20 and the new price of $35, means a profit of $90,000,000. I hope the government will not transfer all that gold to the central bank without first crediting that profit to themselves, and holding it either to reduce the interest on our public debt or to institute a program of public works. It would be a grave mistake in my opinion to turn over that amount of gold to a central bank without using the profit on behalf of the people. That is at least one suggestion that I have to make.
I think some statement should also be made by the government as to why the provinces are not allowed to go to the London market if they see fit to float their loans. I believe that it would be a mistake for one province to compete with another in the financial markets, especially as conditions are to-day. But we might well copy what has been done in Australia by coordinating, if I may use the word, the provinces, perhaps through a committee that might be set up, which would find out the exact financial position of all the provinces and work out a refinancing scheme that would be equitable throughout the length and breadth of this dominion. But if one province is allowed to go into the market to compete with all the other provinces, no one can tell what might happen. It would not be good business, and the situation created might be so serious that I think the government would de well to take precautions against that happening.
The province of British Columbia has intimated that it is not its wish to default, but if no relief is provided in the money market, it feels that it cannot carry on any longer, and it is hardly necessary to point out the seriousness of allowing one province, especially British Columbia, to default. That province is carrying perhaps a heavier burden than most of the other provinces in connection

Debts-Mr. Garland (Bow River)
with unemployment. The municipalities of British Columbia, generally speaking, and the cities, have gone as far as they can in carrying that burden. Besides 100,000 on relief they are caring for ten thousand extra persons who have drifted into the province and are costing considerable money not only to the province itself but to the municipalities who are endeavouring to help carry them.
As I pointed out, British Columbia has borrowed over $41,000,000 to cover her deficits. She will have to borrow this year $3,000,000 for unemployment alone. She owes the Dominion government I believe close to $8,000,000, and with a debt of almost $170,000,000 it is high time we put through a new deal with regard to refinancing and at least make a start towards cutting down our debt and getting a lower rate of interest. We cannot carry on very much longer, and it is a question in my mind just how long we can carry on with a total debt in Canada of over $9,000,000,000 and an interest charge of well over $400,000,000. Here we are sitting back year after year and seeing every other country go to the money market and refinance at 2Js and 3 per cent, while the average rate in Canada on our loans is almost 5 per cent.
It is for that reason, Mr. Speaker, that I join with hon. members who have previously spoken in urging the government to accept the suggestion that has been made for the appointment of a committee where all these matters can be gone into fully before it is too late.
Mr. E. J. GARLAND (Bow River):: Mr. Speaker, at the outset I wish to direct the attention of the house to the fact that the only member outside of the group in this corner who has spoken on the subject before the chair is the last speaker (Mr. Reid). I congratulate him upon the part he has taken in the debate and I hope other hon. members of both political parties will indicate their interest in this subject of such transcendent importance. Doctor Henry Clay, professor of social economy at the university of Manchester, said not long ago:
-in most agricultural countries I see little hope of preventing collapse unless there is a drastic writing down of debts.
The hon. member for Vancouver South (Mr. Maclnnis) added to his reputation when he gave what I consider to be one of the finest analysis of debt creating capitalism which I have heard in this house. It must be apparent to students of this subject that national and international debts can not be paid under the present economic system.
There is no use blinking at the facts or trying to smooth them over; these debts in the aggregate never have been paid and they never can be paid. In spite of this fact we continue to carry this ghastly burden of interest on unpayable debts, evidently for the purpose of sustaining a system which in itself contains the seed of damnation and destitution for the peoples within the system. If any hon. member doubts this conclusion, I suggest that he study the financial sheet of any borough in England, any state in the union to the south, any province of Canada or, in fact, any nation of the world. Let him study the balance sheets of one hundred years ago, fifty years ago, twenty-five, ten, five, three, two years ago, and those of to-day. He will find recorded upon those balance sheets only one story, a story of steadily increasing debts and constantly growing fixed interest charges, which themselves now amount to sums far in excess of debts which were regarded as extreme thirty or forty years ago.
As far as Canada is concerned, I think it is only right to say that every class in the country, with one exception, has borne some fair share of the liabilities of the recent depression. As has been shown already to-day, the farmer has had to face enormous reductions in income as a result of the decline in the price levels. In the brief period from 1928 to 1932 one which by no means tells the whole story, the decline in the value of field crops alone amounted to $637,231,000, or sixty per cent. There was a drop of 65 per cent, or $127,669,000, in the value of live stock during the same period. There was a drop of 48 per cent, or $52,163,000, in poultry and egg production. Even that class which draws their income from investments in Canada suffered a loss, although a minor one, amounting to $19,000,000, or a decline of ten per cent. But there is one class which has taken no apparent loss and sustained no fair share of the depression. Not only have they borne no adequate share of the burden of the depression, but there has been a constant increase in the face value of the returns which they received. In addition to an increase of twenty per cent in the face value, they have received a fortuitous increase for which they have performed no service and for which they have made no compensating productive effort. The Prime Minister (Mr. Bennett) has referred to the increase of 48 per cent which has taken place in the unearned increment of this class. I refer to the bondholders, who received $65,000,000 more in 1932 than in 1928. The continued concentration of wealth is well told

Debts-Mr. Garland (Bow River)
by these figures and must challenge the attention if not the understanding of all citizens of this country.
An interesting study of the wage earner was made by Professor Jackson and Professor Cassidy, who found that by 1932-they did not deal with subsequent drops, which have been gigantic-the reduction suffered by the workers amounted to approximately $1,000,000,000. As I have shown already in part, during the same period the farmer took a cut of easily $1,250,000,000 in annual income. I have made every allowance for any duplication which would occur in the processing of certain primary products of agriculture into secondary products.
Let us turn now to the general condition in Canada, which has been told in part already. I have secured the most exhaustive figures on this subject, and as we are pressing the house for the appointment of a committee to examine all these circumstances, I feel it is entitled to as many facts as it is possible to give. I find that on January 1 of this year the funded debt of Canada was $2,725,704,000. In March, 1930, it amounted to $2,544,586,411. Hon. members will notice the marked increase which has occurred in this short period. In addition to the debt as of March 31, 1932, it will be found that certain securities have been guaranteed by the dominion. This principle of guaranteeing has not been mitigated by the government since that time; in fact it has been materially increased. The railways have been guaranteed as to principal and interest to the extent of $779,944,710, and as to interest only, $216,207,142. Guarantees under the relief acts amount to $28,272,301. Guarantees to Canadian National Steamships amount to $9,400,000, and to harbour commissions, $21,835,118. That is a total in guarantees alone of $1,055,659,271. It is interesting to note that the guarantees as to principal and interest, have risen from $237,878,762 in 1923. I have been unable to obtain figures as to guarantees of interest any farther back than 1923, but the figures for that year are identical with those for 1932. Although there has been no increase, not a single dollar has been paid in principal. The net debt per capita on March 31, 1932, was $226.14. The increase in debt from 1929 to 1934 amounted to $500,200,000. The interest upon this debt amounts to $135,000,000, or a per capita charge of $13.23. The principal burden imposed upon the Canadian people is the payment of the annual 
interest charges upon this debt. As the hon. member for New Westminster (Mr. Reid) has just stated, the average rate of interest is approximately five per cent. As a matter of fact it is 4-923 per cent, so the hon. member was just correct.
I shall now take the record of the provincial governments. The total ordinary expenditure for 1931 of the nine provincial governments was $190,754,202, whereas in 1916 it was only $53,826,219. There has been an increase in total ordinary expenditures in the provinces of Canada in that period of 254 per cent. The aggregate interest payments of the provincial governments in 1931 was $36,748,000. In 1916 they paid only $7,817,000. This shows an increase in aggregate interest payments of 370 per cent.
In Ontario the gross debt in 1934 was $639,967,301, an increase in six years of $216,000,000. The aggregate taxes imposed by the municipalities of Ontario in 1931 amounted to $128,657,684, whereas in 1913 they were only $34,231,214, or an increase in municipal taxes, of 275 per cent in that period.
In the province of Quebec the direct liabilities for the fiscal year 1932 amounted to $108,188,709. The aggregate taxes imposed by municipalities in 1930 amounted to $63,637,000, whereas in 1914 they were only $20,771,000. Here we find an increase of 206 per cent.
In Manitoba the direct liabilities for the fiscal year 1932 amounted to $124,558,810. The aggregate taxes imposed by the municipalities in 1930 were $19,322,697, but in 1912 they were $9,922,537. This shows an increase of 94 per cent.
By the way, it is interesting to note that the fixed interest charges by municipalities have increased enormously out of proportion in central provinces as compared with the west, as will be seen by subsequent figures, and this is as effective a way of rebuking the critics of financing in the western provinces as I could conceive-critics who have been so noisy of late.
In Saskatchewan the direct liabilities for the fiscal year 1932 were $134,068,943. The aggregate taxes of the municipalities in 1930 amounted to $29,609,893, whereas in 1914 they were only $13,358,627. This shows an increase of 121 per cent. The gross debt of that province at January 31, 1934 was $145,623,698.
In Alberta the direct liabilities in the fiscal year 1932 wrere $149,601,000. The aggregate

Debts-Mr. Garland (Bow River)
taxes, municipal, in 1930 were $14,887,676, aa compared with a total in 1914 of $10,022,246. This shows an increase of 48 per cent.
In British Columbia the direct liabilities in the fiscal year were $140,949,520. The aggregate taxes, municipal, in 1931 were $18,260,430, and in 1914 the total was $8,698,820, or an increase of 110 per cent.
In Nova Scotia the direct liabilities in the fiscal year 1932 were $64,161,747. The aggregate taxes, municipal, in 1931 were $6,605,580, and in 1919 they were $3,443,681, or an increase of 92 per cent.
The seven provinces covered by these statistics contained in 1931 approximately ninety-five per cent of the population of the dominion. The total liabilities of the provinces in 1032 amounted to $1,363,382,464. In fairness, I think I should make this comment on the figures: I think it will be clear from what I have already shown that the province of Alberta, with an increase of only 48 per cent, compares extremely favourably with the enormous increase in almost every other province with the exception of Manitoba. Manitoba is next to ours with an increase of 94 per cent.
In addition to the direct liabilities there are also certain indirect liabilities amounting in 1931 to $210,668,231; so that the total liabilities of the provinces in 1932 were considerably in excess of $1,500,000,000.
The total bonded indebtedness of all classes of municipalities I will give next. These figures are taken from the Financial Post business year book 1934, so that they are up to date:
Prince Edward Island.. . . $	1,959,672
Nova Scotia	 31,386,025
New Brunswick	 21,477,521
Quebec	 428,018,439
Ontario	 499,022,074
Manitoba	 91,615,195
Saskatchewan	 59,146,704
Alberta	 78,679,571
British Columbia	 129,913,890
Total

That figure represents the total bonded indebtedness of all classes of municipalities in the areas stated. At December 31, 1932, according to the Financial Post year book, 1934, the city of Montreal showed liabilities, including public utility debt, of $322,089,000; Toronto, $291,229,000; Winnipeg, $128,698,000, and Vancouver, $80,130,000.
I come now to the indebtedness of corporations, as taken from the Financial Post year
book, 1934, page 131. The amount given is $2,234,213,000. To make the figures as exact as possible I have taken the trouble to ascertain the debts of the public to the banks for the year 1932, as shown in the Canada Year Book 1933:
Call and short loans	$
Current loans and discounts
in Canada	
Loans to provincial governments	
Loans to cities, municipalities, etc	
Overdue debts	
117,224,745
1,032,081,481
34,386,119
130,567,792
12,317,980
Total

Approximately ninety per cent of the total assets of the chartered banks consist of money belonging to the public. On the question of farm mortgages, there have already been given in this debate some figures that are exceedingly interesting and that must have alarmed the house. But I repeat, for the purpose of pointing out one oversight, that, according to reliable census figures last available, the total mortgage indebtedness outstanding on the part of one-third of the farms in Canada is approximately $700,000,000-to be exact, $671,776,500. But let it be noted that these figures are only in respect of farms that are so-called "owned"; they do not include the enormous burden of debt on agriculture impending as the result of purchase of land under agreement of sale. I have in mind the debtors of that great land company, the Canadian Pacific Railway, as well as the Hudson's Bay Company and numerous other concerns including our governments themselves who have sold school lands on agreements of sale. If the total indebtedness of agriculture with respect to land alone were known it would be found to be far in excess of the figure I have given and would probably approximate one and a quarter billions. As I have indicated, roughly only one-third of the farmers reported, the number of farms reporting mortgage debt being 242,850 out of 782,000. In the period between the census of 1921 and that of 1931, we find a terrific shrinkage in the value of farm property, a shrinkage running into the figure of $1,025,000,000. The average value of farm land in 1931 was estimated at S30.99 per acre, but let it be noted that the average amount of mortgage debts on owned land alone amounts to an aggregate of $12.66 over every acre of the farm land of Canada.

Debts-Mr. Garland (Bow River)
Urban mortgages have been estimated by some authorities at $765,000,000. I now recapitulate, so that the matter may be Clear:
Dominion liabilities as of
January, 1934	$
Securities guaranteed by Dominion government.. .
Provincial liabilities	
Municipal liabilities	
Corporation liabilities.. .. Bank loans as of 1932.. .. Farm mortgages, 1931.. .. Urban mortgages	
2.725.704.000
1.053.804.000
1.428.597.000
1.315.523.000
2.234.213.000
1.326.578.000 671,776,000 765,000,000
Total	$11,521,195,000
This leaves out of consideration altogether the incalculable and unprocurable burden of individual debts as between individuals and storekeepers, as between storekeepers and wholesalers, and so forth. The per capita statistics of the Financial Pokt year book show the per capita debt as follows:
Dominion	$ 226 14
Provincial	 139 59
Urban	 196 50
:	Total	$ 562 23
Or, as a result of the insanity of the debt creating financial system with which we are cursed, a grand total of per capita debt in the dominion of Canada at this moment of $562.23.


Mr. MACKENZIE (Vancouver):: Does that vary according to provinces?


Edward Joseph Garland: Yes, this is the aggregate.


Ian Alistair Mackenzie: It is more than that.


Edward Joseph Garland: Yes, if you take into consideration personal obligations and other matters like that. This is from the Financial Post year book of 1934. I cannot give later figures than that, nor do I think they are procurable.
The average per capita current revenues and expenditures of the provinces are as follows:
Current revenues	$17 40
Current expenditures	 20 48
So we see the picture there clearly. Just as the hon. member for Vancouver South has said, under the present system the only manner in which we can, as we call it, progress, is by going into debt. You cannot progress without credit, without purchasing power, and to secure either credit or purchasing power under the present system, somebody must go into debt for it somewhere, either to the 
bondholding class, the big financial houses, international and national, or the commercial banks themselves. So we have a system that is piling up these debts until a stage has been reached where the people of all nations, including ours, are being crushed and ground into dust under the load.
The gross debt and public utility .debt of cities is a very interesting study. The figures are as follows:
Gross and' public utility debt
City-	per capita
Montreal	
$393	48Toronto	
463	12Winnipeg	
588	89Vancouver	
323	68I regret that time did not permit	me to
make a complete examination of financial failures in Canada nor of the amount of money involved since 1929. I propose to do that and to produce it on some other occasion, and I am certain the figures will be startling. Commercial failures, however, for 1933, according to the bureau of statistics, were 2,044, with estimated liabilities amounting to $32,953,858.
In January, 1934, the funded debt of Canada stood at the figure of $8,757,840,000; that is the funded debt of the dominion, and the guaranteed securities and the funded debt of provinces, municipalities and corporations. At an average rate of five per cent, that would show an average interest charge of $437,000,000, or $1,200,000 a day. Obviously in the present circumstances it is not possible to pay anything like that sum or any portion of it. As a matter of fact, the reverse is true; Canada in no sense and no class is to-day even meeting interest out of revenue; we are borrowing all along the line to pay interest only, without being able to meet any part of the capital obligation. Even should the time arrive when the feat of paying this debt might become possible and we started to pay it at the rate of $50,000,000 a year in addition to interest, it would take us more than a hundred and fifty years to liquidate the present funded debt of the Canadian people provided that we did not go one more dollar into debt in the intervening period. This would necessitate a complete cessation of all borrowing, I ask the Minister of Public Works (Mr. Stewart) who is in his seat, the Minister of Finance (Mr. Rhodes), or any other hon. member whether they can contemplate continuing the ordinary services of Canada without borrowing. I ask the same question with regard to any provincial government or any municipality anywhere. Of course this can-

Debts-Mr. Garland (Bow River)
not be done, so we have to keep on piling up these beautiful debts under this highly intelligent financial system that we have accepted from somewhere else and made our own. Not only have we made it our own, but we have exalted it in a rapturous affection which causes its supporters to shy away in horror from any suggestion that might in any way modify its burdens.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Edward Joseph Garland: Mr. Speaker, when the house rose at six o'clock I had just shown that the bonded debt of the Dominion of Canada, the provinces, municipalities and corporations would require, in addition to interest, an annual payment of about $50,000,000 if we attempted to pay off our present obligations in a little more than a hundred and fifty years. Of course, as I said at the time, this would also necessitate a complete abandonment of all borrowing, a condition that it is impossible to contemplate. Therefore I submit, considering the fact that last year the dominion alone showed an increase in the net debt of over $220,000,000, that we must either reconcile ourselves to remain in debt in perpetuity or insist upon an entire and drastic reorganization of our complete financial set-up.
In connection with the statistics presented to the house this afternoon I showed that the obligations of the people of the country to the banks alone were almost $1,250,000,000. The annual interest payments on that sum approximate $80,000,000 a year. These bank loans deserve special mention, because if we are to believe the bankers, the Prime Minister and some other hon. gentlemen who have the orthodox, reactionary and quite inaccurate view of the action of the banks, these loans in their opinion are supposed to represent the savings of the people placed with the banks for safe keeping. For our purpose let us assume that their words can be taken at face value. We then find that the banks are paying 2i per cent interest on the deposits of the people, so that the net payments on the part of the people of the country to the banks are about $55,000,000, for the use of the credit of the people. And incidentally I might direct the attention of the house to the fact that bank savings have declined by over $130,000,000 since 1929.
Now, Mr. Speaker, as many of the hon. members of this house come from the provinces of Ontario and Quebec I propose, in the few moments left to me, to touch very briefly the financial situation of those two provinces. I find that in Ontario at the time of the armistice the total obligation by way of provincial debt was $250,000,000. That provincial debt of $250,000,000, has grown until now it is over $600,000,000 and the bond obligations alone that have to be met annually out of the taxes of the people amount to $20,000,000. One can cite similar conditions in almost every municipality and every city in Ontario.
The recent financial crisis in the city of Montreal deserves consideration also when discussing this question of debt. The situation had become so terrible that a delegation recently went to interview the premier of that province, Mr. Tasohereau, to ask him for guidance and suggestions. The guidance he gave them was so characteristic, so delightfully typical of the stupidity and madness of the present system, that I should like to give it to hon. members of this house. His suggestion was, "If you want to meet your obligations, why not tax the tenants in your city?" Tax the poor devils who are trying to get by, by the skin of their teeth. Well, considering the views of Mr. Tasohereau, Mr. Bennett.and those of like mind, one is not surprised at the advice; they do not seem to know or to care what is happening to the people of this country. I find that the revenue deficit in the city of Montreal for the current year is set at $6,731,291, with only $4,375,653 available for running expenses.
On this very point in connection with the city of Montreal one should note that the total funded debt, which stood at $119,312,169 in 1921 now has risen to $251,120,694 as of October last, with the result, of course, that the fixed charges have increased so much that for the third year in succession in the annual budget it has become necessary drastically to increase taxation. The budget totals of the city of Montreal have risen from a little under $30,000,000 in 1928 to over $40,300,000 in 1934-35. So large have become the provisions for interest and sinking fund charges that the amount actually available for carrying on the services of the city of Montreal have dropped from $8,839,000 to $4,375,653. To-day the city of Montreal has only half the amount of money required to maintain adequately the services of the city, with the result, of course, that road clearance and other road services have been decreased altogether out of proportion to the requirements of the city, and neither the police department nor the fire department is adequate to meet the

Debts-Mr. Garland (Bow River)
demands that may be imposed upon them. The situation in the city of Montreal is immensely dangerous to the stability of the whole of the Dominion of Canada. In that city there are already some fifteen thousand vacant homes.
Before I conclude, Mr. Speaker, I wish to add my word of support to the proposals made by the hon. member for Wetaskiwin (Mr. Irvine), who introduced this question this afternoon. As a result of my studies of the problem it is my opinion that not only can the debts of this country, individual and public, not be paid, but that it is essential, in the interests of the economic stability of the country, that immediately there should be a drastic reduction in capital obligations. We would not be originating the principle; it has, in part or in whole, already been adopted by at least three principal countries of which I have knowledge. It was done in Germany two years ago, when all capital obligations in the country were reduced by a flat ten per cent. I submit that even a ten per cent reduction in Canada will be inadequate under present conditions. In both Australia and New Zealand there have been definite reductions, principally in interest charges; in one country there was a reduction of 27J per cent.
I therefore submit to this government that the time has come for the serious consideration by the government of a definite, drastic legislative reduction in capital obligation, particularly the fixed mortgages being carried by the farmer and the unfortunate worker who is trying to pay for his home. Recently in the city of Toronto I ascertained that during the previous week there had been no less than 125 forced sales because people lacked the ability to pay taxes; and the houses were sold over the heads of the unfortunate occupants.
There is one further point, Mr. Speaker. I am in favour of completely wiping out all interest and compound interest from the time this depression commenced until the time the price level will have been restored to the point at which it stood when the greater part of the national obligations were incurred. Anything less than that is just playing with the situation. I make these two proposals because I cannot yet see any intention on the part of this administration of taking the only other step by which it will be possible for the people of the country to do what they honestly want to do, that is, pay their debts. So far as I know there are only four ways in which debts can be paid. Debts can be paid on a rising price level, and by the way interest also can
U-'.r. E. J. Garland.]
only be paid in the aggregate on a rising price level. The moment the price level becomes static or begins to decline, from that moment on the payment of interest in the aggregate becomes impossible. Any student of the subject can verify that fact. So I say debts can be paid, first, on a rising price level. In the second place debts can be paid by a process which we resent and reject; we do not want it and we do not like it. I refer to repudiation. In the third place debts can be liquidated by bankruptcy, which happens to be the common method. That is the chief method to-day; you have industries, institutions and individuals being steadily and constantly liquidated as this infernal process of financial oppression continues.
The last method by which debts can be paid is by reflation. I submit, Mr. Speaker, that the time has come when this government, if it never did before-and I doubt if it ever did-should take into serious consideration the possibility of assisting the masses of the people, particularly the farmers and the workers, to stabilize their position and to pay some portion of their debts by reflationary policies. But whilst reflation may raise the price levels, the wholesale and even the retail levels; whilst it may raise the price level of primary products, at the same time it would be perpetuating a tremendous injustice on the working class if provision were not made through dominion legislation for the maintenance of an adequate rising wage level to keep step with the increase in the price level. If the government of this country does not understake to adjust things on a scientific, economic basis, then there is no use talking about the restoration of prosperity. There is no use attempting to befool the public with a 47 per cent increase in production in a few industries accompanied by only a 16 per cent increase in wages as anything justifying optimism.
On the question of interest, I submit in support of my contention that it should be completely eliminated from the beginning of the depression until the price levels approximate those obtaining when debts were incurred. I submit that in the middle ages the principle of interest was severely condemned by law, and that the principle of interest as a legal instrument is of comparative recent origin. Secondly, interest to-day leaves less than four dollars out of every five dollars produced by the application of labour to resources to be divided among wages, profits and rent. Thirdly, interest is not paid a person for being actively productive or even because

Debts-Mr. Mackenzie (Vancouver)
he has refrained from consuming his wealth, but because he has been unable to consume his wealth. And fourthly, some people-quite a few in this country and in the country to the south of us-have so much wealth that even if they wished they could not consume anything like a reasonable proportion of their incomes. And it is this very type of person who, by drawing further interest on his accumulated surplus, is able definitely to ensure the effective enslavement of most of the people of Canada, both farmers and workers. We can reduce or minimize the effect of this principle to some degree, but only to some degree, so long as the present frame of mind of, I submit, both the larger parties in this house continues. We could reduce the waste of wealth, for example, by refusal to participate in international conflicts. We could declare definitely that, once and for all, Canada is out of everything in the nature of international war, and never again will participate in or be a party to an international war or the accumulation of ghastly death and debt in connection therewith. We could by taxation and, if the government were so inclined, by other means, redistribute national income on a far more equitable basis than obtains to-day. We could, of course, enforce to a much greater degree our usury laws, thereby preventing the appalling overcharges of interest of which some financial houses are to-day guilty.


Pierre Édouard Blondin: The hon. member has
spoken forty minutes.


Edward Joseph Garland: I therefore add my word of endorsation to the proposals of the hon. member for Wetaskiwin, and with all sincerity I urge upon this government the appointment of a special committee immediately, for the purpose of considering further the resolution of this immensely important question.


Ian Alistair Mackenzie: Mr. Speaker, it is not my intention to detain the house before proceeding to the consideration of the estimates. As a matter of fact, although finding myself very largely in sympathy with the suggestion made this afternoon by the hon. member for Wetaskiwin (Mr. Irvine) I can scarcely understand why this debate about the public debt has taken place on the general motion to go into supply, when that debate was not followed by a specific resolution, except possibly, sir, that a specific resolution would have rendered the discussion out of order.
I see that the committee on estimates has still to consider item No. 1, the interest on the public debt of the Dominion of Canada, and with all due respect to my hon. friends to my left I suggest that that would have been the proper place for a debate on the public debt of Canada. In the second place I am somewhat confused by the attitude adopted by my hon. friends in the far corner of the house. They are this evening, and I believe very properly so, advocating the immediate consideration of the national public debt. My memory goes back over the last two or three years; my knowledge of transactions in this house goes back fifteen years, and I know that on every single item which has come up concerning expenditures of money, and very often rash expenditures of public money, the wholehearted endorsation of my hon, friends who are now members of the C.CJ. was given.
Again, I find another peculiar situation: One of the unfortunate situations in Canada to-day is that our Canadian taxpayer is not able to meet his obligations. I humbly suggest to my hon. friends sitting to my left that one of the greatest causative factors of the present impasse in Canada has been the exorbitant tariffs imposed by the right hon. gentleman opposite. And all this has been done with the support of practically all the members of the C.C.F. In that statement I must exclude the hon.. member for Bow River (Mr. Garland). May I suggest, further, that on a former occasion during this session the leader of the C.C.F. said, "I see in this house only thirty members, and only two reporters in the gallery." I wish to recall to the memory of these hon. gentlemen who make eloquent and well prepared speeches and then, leaving the house to its own deliberations, hie themselves to their rooms on the upper floor, that on the first day of March of this session the committee was considering an item which is to be found at page 57 of the estimates for the current year, an item involving an expenditure of $9,559,698. And at a quarter to eleven that evening when this house was considering the item, and discussing whether or not it was just, reasonable and fair, not a single member of the C.CK. was in his seat.
In regard to the tariff increases which have taken place in the last three years, what do I find? I find that when my right hon. friend opposite raised the tariff on September 19, 1930, many hon. gentlemen in the corner refrained from voting. When on the third reading of the bill the hon. member for Shelburne-Yarmouth (Mr. Ralston) moved a

1624	COMMONS
Debts-Mr. Mackenzie (Vancouver)
six months' hoist, how did the hon. member for "Wetaskiwin, who made the suggestion this afternoon, vote? Mr. Speaker, he voted for an increase of tariff on two hundred items affecting the taxpaying power of every citizen of Canada. And with him there voted at that time Mr. Milton Campbell, now one of the ornaments of the tariff board of the Dominion of Canada; Mr. Lucas, Mr. Spencer, Mr. Gardiner, Mr. Kennedy of Peace River, Mr. Luchkovich, and Mr. Speakman. Again I must exempt the hon. member for Bow River from that absolutely unpardonable list of 1930.
Then, again in 1931 the hon. member for Shelburne-Yarmouth moved an amendment to the budget, again seeking lower tariffs, and again the C.C.F.-if it still exists in Canada under that name-took a stand for higher tariff. On that occasion there were Mr. Campbell, the same ornament of the same brilliant tariff board; Mr. Irvine, the same spontaneous gentleman who has made his brilliant presentation to the house to-day, but who on that occasion voted for greater burdens upon the taxpayers-and there were Mr. Kennedy of Peace River, Mr. Lucas, Mr. Luchkovich and Mr. Speakman. Again I have pleasure in exempting the hon. member for Bow River from that unpardonable list of 1931!
This evening we have the anachronism of my hon. friends in the corner of the chamber who in the last three years have supported every resolution and every measure to increase taxation, increase expenditures and increase the public debt in the Dominion of Canada-because tariff increases are nothing but increased taxation-we find them now at the eleventh hour advocating decreases in the public debt. I cannot find any possible consistency, Mr. Speaker, in their attitude. Again I should except the hon. member for Bow River.
I regret that I did not know this debate was to take place this afternoon. Hon. members in the corner kept this wonderful secret to themselves, even from hon. members opposite, including the Minister of Finance-


Edward Joseph Garland: He knew
about it.


Ian Alistair Mackenzie: Then the hon. gentleman and his cohorts extended to the Tory government a much greater degree of courtesy than they extended to us, despite the fact that the hon. member for Bow River and his colleagues-I would not call them conspirators-knew for three years that this was one of the subjects upon which some of us on this side of the house had expressed

ourselves repeatedly and with great conviction. It smacks of collusion!
I have not had the opportunity of perusing the figures given to the house this afternoon by the hon. member for Bow River, but I wish without any qualification whatever to congratulate him upon the wonderful mass of material with which he supported his general thesis. I, too, in a humble way, have been seeking after truth and digging up a few figures from the financial ruins of the policies of this government, and may I very briefly place on Hansard two or three salient figures. I wish to approach this problem entirely in a national way.
In the first place I find from figures taken from official sources that on March 31, 1933, the dominion net debt was $2,596,480,826. The dominion guaranteed debt as at March 31, 1933, was $1,024,424,154. The aggregate provincial bonded debt at the end of the various provincial fiscal years ending in 1932 was $1,369,703,667. The indirect liabilities of the provinces at the end of the various provincial fiscal years ending in 1932 was $209,977,397. In regard to the debt of public corporations an approximate figure as of 1932 is $2,097,000,000. Adding those up-I think my hon. friend from Bow River included other considerations-I find that the total debt of this dominion is $8,911,685,036. That, Mr. Speaker, is the problem of our public debt at the present time.	.
Now I come to the second problem, that of interest, and I find that it is a startling problem. If you take -the years from the armistice in 1918 to 1933, the total interest paid by the federal authority directly upon its own obligations was $1,881,944,088. The amount of interest paid by the federal authority on its guaranteed obligations from 1923 to 1932 inclusive was $221,325,715. The figures before 1923 are not available. The interest on guaranteed obligations cannot with any definiteness be ascertained. It seems impossible to find out the figures in this regard for municipalities, but I suggest that when we add up the various figures of interest payments on provincial debt for the thirteen years from 1918 to 1932, the total is $453,528,134, and that the total interest payments for the thirteen years were S571,702,846. Thus we find a total for interest for the provinces and the dominion for those thirteen years of $3,128,500,783, or nearly three and a half billion dollars paid in interest by the federal authority directly, and in connection with guaranteed obligations; by the provincial authority, direct and guaranteed; and by

Debts-Mr. Mackenzie (Vancouver)
municipalities, and without including the sums which have been paid to our banks.
I wish also to consider very briefly the question of our tax free bonds. I find that on August 1, 1935, there will mature 8874,000 of Canadian tax free bonds at five per cent payable in New York and Montreal; on March 1, 1937, 190,166,900 of Canadian tax free five per cent bonds payable in Canada and New York; on December 1,	1937,
8236,299,800 of five and a half per cent Canadian tax free bonds payable in Canada. So that our tax free bond situation will have been solved in 1937. But I desire to say here what I said from this same seat two years ago. I do not see any legal, moral or equitable obligation against taxing these tax free bonds at the present time, considering how they have been gathered into the hands of a very few people, some very eminent gentlemen in Canada occupying high positions, and who in my humble judgment are evading their just and due obligations to the state.
I might traverse the situation as to where the various debts of the dominion are payable. Take first of all -the debt of the Dominion, $2,715,989,854. Of that amount practically eighty-five per cent is payable in the dominion, which drives home to me this conclusion, that there are no great difficulties in the -way of a conversion loan in the Dominion of Canada. Then $91,040,900 is payable in Canada and New York, $300,000,000 payable in New Tork, and $311,668,136 payable in London.
I have the figures, but I shall not weary the house by giving them in regard to the countries in which the provincial debts are payable.
I come now to the rates of interest payable on our debt. On November 1 of this year there will be maturing I believe in this dominion, $222,000,000 of five and a half per cent victory bonds, which could easily be converted without the slightest difficulty at four per cent. I am suggesting to-day the voluntary conversion of all our internal obligations in this dominion by cooperation and coordination with the provincial authorities, at a rate not exceeding three per cent all over the dominion. I remember having described in detail two years ago in this house what happened in Australia, and I shall not repeat my remarks this evening, but I have here official documents of the commonwealth of Australia in regard to the premiers' plan, and I have also an article which appeared last week in the last letter of the Royal bank. I do not like to quote even from eminent economists, as my friends to
74720-103J
my left are so fond of doing, but may I quote a short paragraph from the last letter from the Royal Bank of Canda by Doctor Marvin, the economist of that bank, in regard to what has happened in Australia:
In the past few months the surplus of government revenues has proved larger than was anticipated, so that the government has been able to give a fresh stimulus to industrial activity by reduction in taxes and tariffs and by actual refunds of substantial amounts paid in taxes. In the budget for 1933-34 these refunds amounted to 7,490,000 pounds.
Again, and this is the last quotation I intend to give:
Throughout the depression there was no prolonged period of disequilibrium and disorganization in Australian industry. Productivity, wealth creation, buying power were maintained. The decline in buying power which is brought about in most countries in a depression is the result of the interruption of the creation of wealth-it is not primarily a result of over-production. Those who continue to create have products ivhich can be exchanged within the country and with other countries. In the world depression it was the monetary system which gave way. The history of the monetary policy of Australia will constitute a precedent of vast importance v hen the next decline in prices creates disequilibrium in world affairs.
So we have, in the first place, the problem of our debt, which to my mind is by far the greatest problem in the Dominion of Canada to-day. In the second place, we have the challenging problem of our interest rates with nearly three and a half billion dollars being paid in worshipping the god of usury in this nation since 1918. In the third place, we have the example of Australia which had a surplus in its recent budget, and I suggest that this government should take immediate action, not to nibble by refunding here and there in small amounts, but to meet the problem boldly; and later on in the session I intend to discuss the question how we can meet the problem of our external obligations so far as our debt is concerned. I support the suggestion made by the hon. member for Wetaskiwin, although I do not believe that a committee of this house will do much good. In the past we have had this question referred to the most able committee of this house, the banking and commerce committee, and where did we get? We got a great mass of bewildering figures, and no concrete results.
There is only one way in which we can solve this problem, and that is for the government of the Dominion of Canada to take action. My right hon. friend the Prime Minister knows as well as I do the direful situation existing to-day among the provinces of our Canadian west and among our municipalities. He can-
1626	COMMONS
Debts-Mr. Stewart (Edmonton)
not tell me, as he did two years ago, that the remedy applied in Australia cannot be applied in Canada. I do not believe it, because Doctor Marvin in his article proves to my mind the very opposite to be the case. I suggest to the Prime Minister that instead of thwarting the provinces of the west, which are to-day endeavouring to refund their obligations in London, there should be one great cooperative and coordinated policy followed in this dominion, not for the purpose of thwarting the efforts of the provinces which are to-day on the edge of the morass of bankruptcy but of coordinating the policies of this government with the struggling policies of the provinces in western Canada and thereby have a wholehearted and generous policy of voluntary conversion, or compulsory conversion, if you will, in the Dominion of Canada. We should press with resolution, with determination, with courage and with vision towards the solution of what is in my opinion the greatest problem now facing the Dominion of Canada.


Hon. CHARLES STEWART (West Edmonton) :: Mr. Speaker, I shall detain the house
but a very few moments.


An hon. MEMBER:: Oh, oh.


Charles A. Stewart: In
order that my hon. friend may not feel disturbed, may I say that I do not intend to make a speech to-night. Perhaps he will agree with part of what I have to say, although he has never been particularly fond of agreeing with anything.
I do not intend to cover any of the ground already covered by previous speakers as I do not believe I could throw any new light upon the subject. The public debt of this country, federal, provincial, municipal, and private, is a stupendous burden and one to which I know the government is giving very serious consideration. We may not agree as to policy but any government in the position of the government of to-day cannot help but realize that this is a most serious problem. Some of us believed that inflation would have proved to be helpful at the time it was proposed, but that suggestion was rejected by the government. I see no harm in supporting the suggestion of the hon. member for Wetaskiwin (Mr. Irvine) that a committee be appointed to make a study of this matter. I agree with the last speaker (Mr. Mackenzie, Vancouver) who said that perhaps this committee will not get very far-I do not believe the Stevens committee will get very far or will prove anything that will be worth while-but the people of the country should know that we are thinking about these matters. I am bound to say

that they scarcely believe that at the present time.
It is the favorite pastime of the hon. gentlemen to my left to say that both parties are quite indifferent to this serious situation, but I do not agree with them. Both parties have to think about it. I agree with the hon. member for Vancouver Centre (Mr. Mackenzie) who stated that these same hon. gentlemen have changed their front very frequently. I know they have done so during the thirteen years I have been here.


An hon. MEMBER:: So have you.


Charles A. Stewart: Not
so very much.
So far as I am concerned, I believe that we were right thirteen years ago. Until something is done about tariffs and freedom of trade we will not get very far with the readjustment of our financial system. I believe that this is the root of our troubles; I have always thought so and I shall always continue to think so. I have spent some years in public life and I must object when an hon. member stands up in his place and states that governments have spent money recklessly. I could make the same charge against certain hon. gentlemen in western Canada who have been 'in public life just as long as I. These gentlemen are colleagues of my hon. friends, and it may be that they have been even more reckless in this regard than the federal government. The truth is that the public demands these expenditures. Pay day has arrived and apparently we are unable to pay. I do not know whether it is going to become necessary to repudiate our debts, but I do know that at the present time we cannot continue to carry the heavy interest burden. I do not intend to enter into a discussion of this matter tonight, although I may do so on a future and more appropriate occasion. There cannot be too much study of this question; there cannot be too much light thrown upon it, and for these reasons I am in favour of the suggestion of the hon. member for Wetaskiwin (Mr. Irvine).


Richard Bedford Bennett: Mr. Speaker, the most amazing things are said when a discussion such as this is precipitated without a motion of any kind. We had a similar discussion on an amendment to the motion that the house thank His Excellency for his speech. Much of this ground was traversed at that time, and the hon. member for Labelle (Mr. Bourassa) proposes to move an amendment to-morrow to the motion to go into supply, at which time there will be still further discussion. Prom

Debts-Mr. Bennett
three o'clock to six o'clock this afternoon and from eight o'clock up to the present the house has been discussing no motion; it has just been uttering words which have already been uttered this session at least three times. These are the cold facts and we may as well recognize them now as at any other time.
The last two speakers, the hon. member for Vancouver Centre (Mr. Mackenzie) and the hon. member for West Edmonton (Mr. Stewart), have stated that there can be no salvation until this country repents of its tariff policies, until the barriers are removed and the sun shines and all is well in Israel. The hon. member for Vancouver Centre commenced his speech with the most urgent request that we copy Australia, a country which has the highest tariffs of any country in the world; thereby, salvation would be brought about. That country not only has the highest tariffs of any country in the world but it has a great many embargoes and other forms of taxation allied to the so-called tariff taxation. The hon. member for Vancouver Centre must have known that. He must have known that the way in which they worked out their economic salvation was through tariffs-they lessened imports, expanded exports, and reduced adverse balances.


Mr. YOUNG:: They tightened their belts.


Richard Bedford Bennett: They tightened their
belts, something which the hon. gentleman apparently does not know how to do. I observe with great satisfaction that he shows evidence of increasing weight. In these days of drought he has been flourishing even as the green bay tree by the water side. But this is always desirable.
I mention these things as an indication of how difficult it is to apply a fixed rule and say that it should be made applicable to all countries. Australia has adopted a method which we are asked to follow, but when we follow it, we are condemned.
I should like to know what hon. gentleman in this house has given as much attention to the debt question as those who sit on the treasury benches. We have been responsible for the effort which has been made to maintain the financial integrity of Canada. I have heard jeers that we should care more for our people than for our credit, but I wonder if there is an hon. member familiar with business who does not know that the salvation of the people depends upon the credit which is maintained for them. How are we to secure the very things which we need in this new country if we destroy our character? Our character is our credit and our credit is our character.
I have listened so often to the observations made by hon. gentlemen opposite and in the far comer, especially the hon. member for Bow River (Mr. Garland), whose principal avocation seems to be the endeavour to induce people to be prejudiced one against the other. If any one has five cents, that five cents belongs to someone other than the person who owns it. That is his theory in life, to incur debts but not to pay them.


Edward Joseph Garland: The right hon. gentleman is quite wrong; I made it quite clear that I desired to pay the debts.


Richard Bedford Bennett: I am just saying that his public and private utterances are to incur debts and never pay them.


Edward Joseph Garland: That is incorrect. The right hon. gentleman has no right to say such things of me and he knows it.


Richard Bedford Bennett: I know that what I am saying is correct.


Edward Joseph Garland: He knows that is not correct.


Richard Bedford Bennett: To incur debts and not pay them, that is his policy.


Edward Joseph Garland: That is not correct.


Richard Bedford Bennett: To incur them privately and publicly and not pay them. What is more, to-night we have listened in this house to the doctrine that it is all right to repudiate, to take compulsory action in connection with the payment of debts.
Now, sir, I put this to the house: Who is more apt to think seriously of this problem? Those who have the tremendous responsibility of endeavouring to deal with it, or those who have not-those who have the responsibility of endeavouring to see that this country does not default, or those who have not? Who has the most serious part of it? Who has the obligation? Who is thinking of it most constantly, not in terms of political advancement, but in terms of responsibility to the country he serves?
We found here, as hon. members know, two and a half billions of debt, most of it incurred in a great war, carrying rates of interest as high as 5i per cent; and one of the first things we did was to endeavour to convert part of the debt. I was told it cou'ld not be done; I was told by high authorities that it could not be done, and yet we appealed to the country to convert 5i'a to 4i's. I personnally should like to have gone lower, but I was
Debts-Mr. Bennett

told it could not be done. However, we converted it into 4i's to the extent of $640,000,000 odd, since which time we have made further conversions, so that over $800,000,000 of debt has been converted into a lower rate of interest.
Now one of the problems with which this government is dealing, I think I can say every day of its life, is the problem of how this interest burden can be lessened. Last week I spent three hours with the representatives of all the mortgage lending associations in Canada-an hour and a half in the morning and an hour and a half in the afternoon. I find, for instance, that one of them has borrowed $30,000,000 from various investors throughout the world and has issued certificates or receipts which carry a rate of interest of 5 per cent per annum. I may say I was greatly surprised that the rate was so high. In another instance it was some $29,000,000, in which almost the same figure is applicable. That money comes to Canada and is loaned to farmers, to merchants, to owners of property on first mortgages, and the rate received is 6, 7 and in some instances 8 per cent. I found to my surprise that one of the insurance companies lending in western Canada, after having written off substantial sums of money, had received as an average on its investments in the west 4.87 per cent.


Edward James Young: Net?


Richard Bedford Bennett: That was net payment,
yes-4.87 per cent. I found that that rate was much lower than many of the loan and trust companies were paying for the funds which they were lending.


Charles A. Stewart: Rural and
urban?


Richard Bedford Bennett: 
Ian Alistair Mackenzie: That is
the point I made.


Richard Bedford Bennett: Yes. But we could do
this: We could say that we shall not pay more than three per cent upon any of those securities. What would that mean to the world? I just put it to the house: What does it mean to any of us? What does it mean if, with my note at the bank bearing interest at six per cent: I walk into the bank and say that I am going to pay three per cent. Do hon. members think I would borrow money there readily again? Someone suggests that the banks might be glad to get it. They might, if I had nothing but three per cent, but if I had anything more than three per cent with which to pay, they would probably endeavour to collect it.
With respect to a nation the position is somewhat different. You cannot sue a nation. You could not sue the Dominion of Canada. Who are the holders of these securities? They are primarily the insurance companies, primarily those who, for the purpose of meeting contracts maturing in the future, have invested in these securities on the basis of their yielding somewhat a higher rate than three
Debts-Mr. Bennett

and a half per cent to take care of contingent losses that may arise by reason of fortuitous circumstances. Every hon. member, if he will think for just a moment, will realize, will understand that. Second, there are the estates in trust, trusts that have been created by, say a great foundation, for caring for the sick, the afflicted, or for scientific research. Hon. members know where, for instance, two or three of the large foundations have made their investments. Third, you come to the private trusts, cases in which families have provided for their children and grand-children and have invested their trust funds in the securities of the country on the assumption that they would pay the rate of interest which they had promised to pay. Lastly, there are those private investments which have been made by individuals for their old age.
Let me give the house just one illustration of the other side of the picture. The other day I had a letter from a gentleman who said: "I am an old man." He gave his age; I cannot quite remember, but I think it was in the vicinity of seventy. He said: "During my life I have saved so many dollars which I have invested in Dominion of Canada bonds, and I hope, Mr. Bennett, they are not going to reduce the rate of interest, for if they do I cannot live." That is the last class I put before the house, and I have gone over them all. There seems to be an idea in the minds at least of some people, that the rich hold all those securities. As a matter of fact the rule generally is that the rich vary their investments, because it is an essential rule of the Anglo-Saxon people in connection with investments that they should be varied and that too much should not be invested in any one security. The result is that the Anglo-Saxon, shall I say, contemplates the possibility of there not being a loss in everything, so his investments are scattered over a wide field. Nothing will convince hon. members so clearly upon that as to look, some time when they may have an opportunity, upon the inventory of the estate of a deceased Englishman of some wealth, who has died in ..England and whose will may have come here for probate. It will be found that he has varied his investments; he has very seldom any large sum in any one security, but he scatters his investments over everything in which he can invest. I have given the list of those with whom we have to deal.
Now let us go back. First of all we come to the small man and we tell him that we are not going to pay any more than three per cent on his investment. I have indicated to the house how he feels about the matter. I

go to the trusts and it may mean the difference between just an existence and inability to keep their heads above water on the part of those who are dependent upon funds from a trust. I go to the next, the public foundations, and there I find an immediate curtailment of revenue. Who has not looked at the list of securities held by the universities and observed the curtailment of revenue that has taken place during the last few years? Who has not looked upon the investments of great foundations and observed the result? Then I come to the insurance companies which have to publish a list of their investments, and hon. members who are interested in these matters and have followed them will realize the extent to which this action of repudiation on the part of our country would affect that business. I thought the hon. member for West Edmonton (Mr. Stewart), who said we do not often agree, was perfectly fair when he said these considerations are present in my mind every day of my life; so long as I am in this position that will continue to be so. There is no other single problem about which I have thought so much, to which I have given more attention or in which I have sought information from as many sources, there is no field of information that I have not explored from the standpoint of securing the views of those who might be able to assist us.
I am not unmindful of what was said by the hon. member for Vancouver Centre with respect to our tax exempt securities. I have analyzed that matter too. I may say that I did not favour tax exempt securities, but that does not prove a single thing in the world except that my opinion at that time was one thing and other people who had the responsibility which I did not have held a different opinion. But I just put this to this house: despite what has been suggested to the contrary these tax exempt securities are held largely by estates. I happen to know of two or three cases; the first thing they did, when they came into funds, was to pay a premium and avail themselves of the opportunity of investing in tax exempt bonds, because they felt there might be such an increase in the income tax that the revenue which was looked to for certainty would thus become uncertain and unstable, whereas with a tax exempt bond, even bought at a high premium, there was absolute stability and security as to the revenue that would be derived from the trust. It will amaze hon. members of this house, on investigation, to learn the extent to which these securities have been issued in bearer form, and in that form they have been scattered over almost every country in the world. The coupons come in,

Debts-Mr. Bennett
I should not say from every country in the world but- from an amazing number of countries. They have been a favourite form of presentation, shall I say, for trust purposes. A godfather desires to give a child a present; he selects a thousand dollar bearer bond of the Dominion of Canada, tax exempt, bearing interest at 5J per cent. A small trust fund of a few thousand dollars is to be set up; this is a favourite method to be followed. A larger trust fund, perhaps a foundation, desiring to have a certain revenue to a fixed date, 1937, may also follow this method. While my mind is always open to conviction and my opinions change with enlightenment and knowledge, I can only say that I have formed the opinion that no effective conversion of this country's obligations, nationally, can be carried out in any proper form as long as those tax exempt securities are outstanding, and that means 1937, three years hence.
I merely give this to the house as my view at the present moment, not that it might not change, and I may say that this is nothing new as far as I am concerned. If hon. gentlemen are interested they will find that when I sat where the hon. member for West Edmonton now sits, or in the seat beside him, I urged this house and the then Minister of Finance to enact legislation that would compel the insurance companies to invest their reserves in a consolidated debenture of the Dominion of Canada carrying interest at 4 per cent. Financial papers denounced that as confiscation, and nothing came of the suggestion. During the war, however, we did insist that the insurance companies should invest their reserves in our bonds, and they did so. I am happy to say that as a result of the action that has been taken by the administration during the last few months and years there has been an increasing investment by the insurance companies in Canadian securities. Those of you who are interested will find, from a perusal of the reports made by the insurance companies, the extent to which that is so. Only last week, for instance, a financial gentleman here from New York told me that one of the greatest private investment houses in the world suggested the buying of Canadian securities. In a world of suspicion, of doubt and unrest; in a world where values have been so changed by legislative action and experiment, where the standard of values has been changed from week to week and month to month, whatever else may be said, at the moment this country enjoys the reputation of having met its obligations in the terms of its contracts. I have been laughed at for making those observations; I do not mind that. We have the reputation of having maintained our financial integrity during all the stress and strain through which we have passed. It might be of interest to some of those who attack what we have been doing to read the observations made in that regard in the Senate of the United States and in some continental parliaments.
We have been governed by two considerations, Mr. Speaker. One has been that if we desire to convert, as we do, we can do so only by maintaining our integrity to the last dot, in order that conversion will have about it some evidence to ensure that we will pay what we undertake to pay. The second consideration has been that in making a readjustment and conversion in this country, with our geographical position and with the richest country in the world immediately to our south, and with our obligations scattered throughout the world and payable in three countries, Great Britain, Canada and the United States, we must hesitate before we endeavour by legislative action to repudiate the contractual obligations we have incurred with those who have loaned us their money. Those considerations have guided your government in endeavouring to deal with these problems. We have a clear sense of the necessity of reducing interest charges and we have reduced them by $9,000,000, but that has been almost made up by the additional borrowings we have had to make in order to meet the situation.
There is one other point we must keep in mind, sir, before we can talk about conversion at all, according to the advice given me by what I conceive to be the soundest financial men in the world, whether they be in Great Britain or in the United States. We must deal with our railway problem, for there can be no conversion of our national obligations as long as we have to provide a million and a quarter dollars per week for the railway deficit. To-day the Minister of Finance (Mr. Rhodes) tabled the supplementary estimates for the year ending March 31, 1934, this year, and you will observe that the sum for which we are now asking is $52,263,819.65, plus certain additional sums with respect to the maritime freight rates, which have already cost us $6,600,000, and with respect to the West Indies service, to which we are obligated by treaty. Sir, the entire obligations of the Canadian National for last year necessitate the taxpayers of this country finding $68,000,000, or something over a million and a quarter a week. Of course it is easy for hon. members opposite to say we cannot do
Debts-Mr. Bennett

this thing. The answer, sir, is that we have done it and we must do it or lose our reputation. There is no half-way house. There can be no caring for the poor, no caring for our population unless our reputation is maintained so that we may secure additional funds for the development of this country. And it is for the purpose of enabling us to deal with our own people and deal with the problems of the future that we have been so much concerned about the maintenance of our credit. So long as that million and a quarter a week stands as an obligation for the Canadian people to meet, I believe, sir, that the problem of conversion is almost, if not wholly, insuperable. That is the reason we asked this house and the Canadian people to give the greatest possible opportunity to the trustees to enable them to demonstrate the extent to which it may be possible to restrict losses, to restrict expenditures and to maintain some service on our railways for the Canadian people. That is the reason. And of course you cannot have palace cars running into remote communities; you cannot have daily service; you cannot have two trains running where one will do the business, if we are to accomplish anything.
If I knew of any other way than the one this board of trustees is endeavouring to follow, I would gladly suggest it to this house and ask parliament to accept it. For, might I say to hon. members, as Canadians, that there are matters in connection with which party considerations never cross one's mind. With respect to raising the revenues to meet the tremendous obligations of our country I do not think even our bitterest enemies could suggest that considerations other than those of necessity have governed the action which we have taken and must continue to take.
It is all right, Mr. Speaker, for our friends to criticize; it is all right to condemn-but for the moment the responsibility is ours. The obligation to maintain the credit of Canada rests with us, not with them. And despite the weaknesses of frail humanity, we strive day and night, to the extent of our physical strength and our intellectual power to devise ways and means that this country may not repudiate its obligations, lose its financial reputation and bring disaster and ruin upon our people. In that task we have succeeded, and with that task we will engage ourselves so long as we occupy the position we are now occupying. Whether or not any good purpose can be served by the production of masses of figures to show that men cannot pay the debts which they promised to pay is open to

question. The other day I dealt with a group of mortgage organizations, showing them that the farmer would have to produce two bushels of wheat to pay the debt which he was able to meet with one bushel when he incurred it, but all that is not a reason why we should repudiate our debts. It is a reason why we should endeavour to place the farmer in a position where he will get sufficient money to be back where he was when he incurred his debt.
That is the difficulty with all debts payable within a term longer than a year. Any debt payable within a term longer than a day is based upon the possibility of there being great changes. No man knows when he promises to pay $1,000 three years hence with interest at five per cent per annum that commodity prices which would enable him to discharge his obligation with X bushels of wheat or X bushels of potatoes shall have so changed that he will have to pay X-plus in every instance. In some days it has been AT-minus. I recall debts in western Canada which were paid off with three dollar wheat. I recall debts in western Canada paid off with two-dollar wheat-debts which were incurred on the basis of $1.25 or $1.40 wheat. I recall these things, because for thirty-seven years I lived in western Canada, and I am not unmindful of the fact that debts incurred on the basis of commodity prices being X have been paid when commodity prices were X-plus; and the "plus" was so great that it could hardly be recognized, with respect to the X to which it was added.. These are facts as old as time itself, as old as the world. I suppose it is the reason why every fifty years they had a jubilee and the debts of the ancient regime were forgiven. That is probably the reason, because interest is no new thing. It is not anything which has been discovered in the twentieth, the nineteenth, or the fifteenth century. It is as old as the very foundations of our civilization, that when a man borrowed money from another he paid for the use of it, and by and by this began to be called interest. Whether or not it has been a wise practice is not for me, with my limited knowledge, to say. This I do know, however, that this magnificent structure of life insurance which we have built up, this magnificent structure of insurance which has dominated the whole of our civilization is predicated upon the fact that money will earn something by way of interest in order that *contracts contained in policies may be paid.
I have spoken longer than I had intended. I only desire once more to say that everything connected with this problem, to the extent that

Supply-National Health
we may be ahle to investigate it, and with our Limited power of understanding it-everything that can be done is being done, having in mind the necessity for converting the debt of this country to a lower rate of interest than that which now obtains.


Edward Joseph Garland: I rise to a question of privilege. In his speech the right hon. Prime Minister stated that the hon. member for Bow River stood for the incurring of debts and then not paying them, I have never made any such statement either publicly or privately, nor do I hold such views. If the right hon. gentleman had only-


Pierre Édouard Blondin: Order. The right hon. gentleman was perfectly in order in drawing the inference he did. He may have misunderstood the hon. member for Bow River, but that is not a question of privilege.


Edward Joseph Garland: I now
definitely and unqualifiedly deny any such contention.


Pierre Édouard Blondin: The hon. member has taken part in the debate in this house, and he will have the opportunity to do so again. Shall the motion carry?


[Stage Direction]
Motion agreed to.

[Stage Direction]
The house in committee of supply, Mr. Maloney in the chair.
National health-
The administration of the acts respecting food and drugs, opium and narcotic drugs and proprietary or patent medicines, including the laboratory of hygiene, $130,000.
Public health engineering, $15,880.
Marine hospitals, including burial expenses of destitute deceased mariners and grants to institutions assisting sailors, $163,500.
The administration of the acts respecting quarantine and leprosy, $150,000.
Immigration medical service, $126,920-Total, $10,334,500.
Mr. HOWDEiN:	Would the minister explain the reduction of 810,000 in the first item?
Murray MacLaren: The amount actually expended last year was $126,818, and it is proposed to vote $130,000 this year. It will be noted that there is a reduction in nearly all of the items in this vote, which is due to the general policy of economy.


Mr. REID:: Would the minister explain
the reduction in the item for immigration medical service?


Murray MacLaren: The appropriation of
S126.920 is to cover the cost of medical examination of prospective immigrants prior to embarkation and on arrival at Canadian ocean ports in accordance with section 3 of the Immigration Act, which stipulates that persons who belong to the prohibited classes on account of physical or mental defects shall not be permitted to settle in Canada except as provided in the act. It also covers the operation of immigration hospitals at ocean ports for the observation, care and medical treatment of immigrants needing the same; also the hospitalization of passengers and crews suffering from minor infectious diseases; also the medical examination, care and certification of deportees.


Mr. HOWDEN:: Is the inspection service
still being maintained in Europe for these cases?


Murray MacLaren: Yes. We have one
medical officer at Paris and one each at the following ports: Hamburg, Antwerp, Belfast, Glasgow, Liverpool; and two in London.


John Power Howden: That is a considerable
reduction in the number of these doctors?


Murray MacLaren: Yes, very considerable.
It is less than half the number of immigration officers employed some few years ago. There is close cooperation between this department and the Department of Immigration, and it is on the advice of the Immigration department that these medical officers are placed in the cities I have mentioned, also as to the number employed. Then there are the roster doctors in Great Britain in addition to the regular immigration medical officers.


Mr. VENIOT:: With respect to the item
of $150,000 for the administration of the acts respecting quarantine and leprosy, would the minister explain the reduction of $12,000?


Murray MacLaren: The expenditure last
year for the administration of those acts was $145,456.90.


Peter John Veniot: And the vote this year is
based on last year's expenditure?


Murray MacLaren: Yes, plus a small margin of about $4,500.


Peter John Veniot: May I ask if there is any
idea of amending the act with regard to leprosy?-the Leprosy Act, I think it is called. For the benefit of the minister I may say that there is a rumour prevalent in the county of Gloucester, which I have the hon-
1G34
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our to represent, that it is the intention of the department to amend that act, and I should like to know if it is intended to amend the act this year.


Murray MacLaren: There is no such intention whatsoever. There has been no such proposal and no consideration of the question from that standpoint. Some eight or nine years ago under a previous administration the question of moving the lazaretto from Tracadie to some other place was under consideration by the department, but nothing was done. That is the only basis I can suggest for the rumour my hon. friend mentions.


Mr. YENIOT:: I am glad to learn that
there is no intention of amending the act this session. Has a permanent appointment yet been made of medical superintendent for the lazaretto at Tracadie?


Murray MacLaren: The appointment of
Doctor Ryan was temporary, but he is filling a position which is considered permanent.


Peter John Veniot: Could the minister state
when that appointment will be made permanent? I do not object to the temporary appointee because I think the official is a good one.


Murray MacLaren: I cannot say. Most of the appointments now being made are temporary.


John Power Howden: Are the medical inspectors stationed at the various European centres on a salary basis or do they receive fees?


Murray MacLaren: The eight medical
officers which were mentioned are on a salary basis, but roster doctors receive fees for their examination of immigrants from the immigrants.


Peter John Veniot: I should like the minister
to be a little more explicit in connection with the permanent appointment of a medical superintendent at the Tracadie lazaretto. If I understand the situation aright, this gentleman has been occupying the position for six or more months. He has moved his family there and the usual time of probation for a temporary appointment has passed. I feel that if the department would recommend to the civil service commission that a permanent appointment be made, it would be made.
While I am on my feet I should like to try to arrive at a better understanding between the minister and myself with reference to the question of appointments to the lazaretto brought up on March 17, 1933. At that time I asked the minister why the temporary ap-

pointment had not been made permanent, and the minister replied that the then appointee had been replaced by Doctor Peloquin, I understand from the department. The minister stated that the civil service' commission was being requested to make another appointment. I expressed some surprise that the temporary appointee had been dismissed or laid off, and the minister replied that he could not give any reason for this action. The minister is reported on page 3114 of Hansard of 1932-33 as follows:
I have stated to thg committee that his temporary appointment was not confirmed by the civil service commission.
Later on I asked for all the correspondence between the department and the civil service commission, and when I received the file I found that it did not bear out the statement made by the minister. I do not wish to suggest that the minister knowingly gave the wrong information, but I have the file before me and I find that the commission informed the department that they were ready to issue a certificate for a permanent appointment to be effective November 21, 1932. This statement was made in response to a letter from Doctor Heagerty asking the commission if they were prepared to make a permanent appointment. The commission stated that the permanent appointment would be made effective November 21, 1932, provided that certificates of birth, health and character were submitted. According to the file, these certificates were submitted but there was some delay in making the permanent appointment due to the fact that the temporary medical superintendent was also port doctor for Cara-quet and Shippigan. It was necessary that he should resign from these positions as he could not continue to hold them and remain medical superintendent of the lazaretto. It was stated that when these resignations had been sent in, the permanent appointment would be made. I find from the file that the temporary appointment was continued by the issuing of monthly certificates by the civil service commission up to and including January, 1933, at which time a certificate was issued for January and February. At page 21 of the file there is a letter from Doctor Heagerty to the civil service commission dated January 25, 1933, in which he notifies the commission that the services of the temporary superintendent would be no longer required because he had not given satisfaction to the department. That being the case, the commission did not issue further certificates. He was not dismissed because the commission refused to issue certificates. It is quite true

Supply-National Health
that the commission did not issue further temporary or permanent certificates, but they did not refuse to do so; they simply accepted the statement of the department that the medical superintendent was not giving satisfaction and, therefore, a certificate should not issue. I find further from the record that the department asked the civil service commission to appoint another temporary superintendent from the supposed eligible list and to notify the then temporary superintendent that his services were no longer required. The civil service commission replied that they had nothing at all to do with the giving of notice to the temporary superintendent, that that was the duty of the Department of Pensions and National Health. The notice was then sent by the department. The commission notified the department that they could not make another appointment to replace the then medical superintendent because there was no eligible list. The doctors who had applied in the first instance had not qualified, with the exception of Doctor Hache. The commission stated that if the department desired to make another appointment, the vacancy would have to be advertised again. That was done. The minister informed me last session that the civil service commission did not issue the certificate, that it was their business, and that he had nothing further to do with it. According to the record I have here, sessional paper No. 337 that is not so. Now I am not criticizing the minister; I am merely stating facts, not in the way of criticism, but in order to have the record correct, and I say that either the minister was wrong in the information he gave me, or sessional paper No. 337 is wrong. I think the error was made when the minister stated that the commission had refused. The commission did not refuse, but they acted on the advice of the department, and in this regard I simply wish to have the record correct.


Murray MacLaren: I fail to see any difficulty or obscurity in the matter. I do not think Hansard will show that I stated that the civil service commission refused to appoint him.


Peter John Veniot: I did not say that. I read what the minister stated:
I have stated to the committee that his temporary appointment was not confirmed' by the civil service commission.
That left the inference that the civil service commission had refused to issue the certificate, whereas it was the department that had refused to recommend the permanent appointment.


Murray MacLaren: I should like to know where that extract is from.


Peter John Veniot: It will be found at page 3114 of Hansard, volume III, 1932-33.


Murray MacLaren: What are the exact
words?


Peter John Veniot: I have just read them:
I have stated to the committee that his temporary appointment was not confirmed by the civil service commission.


Murray MacLaren: That is quite right; I do not see any objection whatever to that.


Peter John Veniot: The objection I have is that it left the inference that the commission had refused to give its ratification at the time.


Murray MacLaren: That is not the inference I draw from it.


Peter John Veniot: There cannot be any other inference.


Murray MacLaren: Yes, I think there is another inference; and in any case it is not a question of inference but of the record- what I stated. There was a temporary appointment. That requires a certain number of months to be confirmed. Prior to the period of confirmation having been arrived at, the official of the department wrote to say that the appointment would not be satisfactory, or would be unsuitable, or words to that effect, and he asked that the advisory committee be reconvened. That is the action so far as the department is concerned.


Peter John Veniot: That is not different from what I stated.


Murray MacLaren: Then the civil service commission took action and reconvened the committee, and the committee continued to carry out whatever it decided upon doing. That was not the action of the department; it was the action of the civil service commission and of its advisory committee.


Peter John Veniot: That is exactly what I said, but there is no question about the inference having been left by the statement made by the minister on March 17, 1933, that the civil service commission had refused or refrained from issuing any further certificate to Doctor Hache on their own initiative. I contend that they did not do it on their own initiative but on the initiative of the following letter dated January 25, 1933, signed by J. J. Heagerty, M.D., chief executive assistant and addressed to Hon. W. J. Roche, chairman of the civil service commission, Ottawa: Dear Mr. Roche,
As the department is of the opinion that Dr. Joseph E. H. Hache, who is occupying the
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position of physician to the lazaretto at Tracadie, N.B., in a temporary capacity, and who, as a result of a competition held by the civil service commission led the eligible list-
I may add that he is the only one that passed; the others all failed.
-for permanent appointment is unsatisfactory, I would request that you kindly arrange to reconvene the board to again consider the matter.
If you will have the kindness to notify Dr. Hache at the earliest moment that his services are unsatisfactory, I shall be obliged.
In response to that letter the civil service commission informed the department that it was not their duty to notify Doctor Hache, as he was a temporary appointee, but that it was withing the province of the department to dismiss him and their duty to notify him to that effect, which the department did.


Murray MacLaren: That is a pretty fine
point, and I am not prepared to admit it. It may be right, but that is not the question that arose particularly, because it is necessary, as I understand, after a certain period for the commission to confirm the appointment or otherwise.


Peter John Veniot: You asked the commission not to confirm it. That is what you dad by this letter.


Murray MacLaren: I should like the hon.
member to use the exact words, because they are important in this connection.


Peter John Veniot: I have read Dr. Heagerty's letter.


Murray MacLaren: It is true the commission was informed that the appointment was not satisfactory. Then it rests with the civil service commission to complete the act. I remember the discussion that took place at the time, and I recall the hon. gentleman asking why the department had asked for the position to be readvertised.


Peter John Veniot: Yes, I asked that question.


Murray MacLaren: I do not remember at
all what answer I gave, but I do know this, that the department never asked for it to be readvertised.


Peter John Veniot: No; the department asked
that the civil service commission make another appointment, a temporary appointment, from what was supposed to be the eligible list.


Murray MacLaren: No, excuse me-


Peter John Veniot: Oh, they did.


Murray MacLaren: But I say no.


Peter John Veniot: But the record shows it.
[Mr. Veniot.l


Murray MacLaren: The department wrote
a letter to the civil service commission saying that the appointment was not satisfactory and asking them to reconvene the committee. I think the hon. member will find that in the letter.


Mr. HURTUBISE:: In answer to a question a little while ago the minister said that the reason for the decrease in this estimate was that it was following the general policy of the government to practise economy, and then he mentioned eight regular medical officers in the different cities who are paid a fixed salary, and the roster doctors. Why could not the department practise economy by doing away with the regular doctors, leaving the work to the roster doctors only? Many thousands of dollars could be saved by putting the examinations under the roster doctors. Economy could be practised in that way.


Murray MacLaren: So far as the cost of the present number, I think eight, is concerned, that is a small number for our Canadian medical immigration officers to have in the whole .of Europe. It is necessary for us to have two medical men in London so as to keep in touch and consultation with the immigration officials. It is also necessary in the large centres such as Liverpool, Glasgow, Belfast, to have our own men who are responsible to us and who, if they are not qualified to carry out a very important duty, would require to be replaced by other efficient examiners. There is this very great difficulty of having immigrants found, on their arrival in this country, to be unsuitable owing to their physical conditions and therefore having to be retained until they are sent back to their homes. These are people who come out here, who have sold their property, their chattels and furniture and who have made all preparations. to take up a new home in a new country, and I do not think it would be wise to depend entirely on roster doctors who are living on the other side and over whom we could not have the same authority and supervision.
About six years ago we had twenty-eight medical officers in Europe. We now have eight. I think my hon. friend will admit that economy is being practised and that the numbers are being brought down to the irreducible minimum.


Joseph Raoul Hurtubise: What are those regular doctors paid? Are they paid a fixed salary?


Murray MacLaren: 
Joseph Raoul Hurtubise: What is the fee for the roster doctors for examinations?


Murray MacLaren: Ten shillings, I understand. Formerly the roster doctors were paid by the dominion and British governments, each paying half. At the present time they are paid ten shillings, but not by the Canadian government.


Joseph Raoul Hurtubise: My reason for asking these questions is this: The minister has just told us that the number of doctors has been reduced from twenty-eight to eight. We have been told many times in the last three or four years that the doors were closed to immigration. If so, I do not think we should have a reduction from twenty-eight to eight, but we should have a reduction from twenty-eight to nothing, leaving to the roster doctors the work that is left.


Mr. HEAPS:: How many examinations did those doctors hold last year?


Murray MacLaren: Let me answer my hon. friend immediately opposite (Mr. Hurtubise) first. It is true that the doors are said to be closed to immigration, but that is to some extent a poetic phrase; it is only comparatively the case. I recall that last year the discussion was as to why we should have a medical officer in Paris; that surely he could not have very much to do there. As a matter of fact more medical examinations are made by our medical officer in Paris than by any of our other officers in the large cities. In Paris last year 1,173 examinations were made by the medical officer. That is the largest number made in any of the communities. The next largest was in Antwerp, 951; Hamburg, 784. It is true that the immigration is very small.


John Power Howden: Has the minister been able to trace false passes or examinations to the roster doctors? He mentioned a few moments ago that it had been necessary to turn back at Canadian ports some immigrants who had been allowed to embark and he set this forward as a reason why a regular staff of examining doctors should be retained in European centres. Have applicants who have been passed by roster doctors been found to be less suitable than those who have been passed by the regularly employed staff of physicians?


Murray MacLaren: If my hon. friend will pardon me, I did not say that this had actually occurred. I say that there is more likelihood of such immigrants being passed by roster doctors than by our own. Why? Our own medical men over there are immigration medical officers and that only. They are trained in that work; it is their daily task. That is a different matter from picking up a country practitioner in any part of England. I do not say that I can actually make a comparison; but I say they are better qualified, their opportunities are much greater and they are much more likely to make a careful and accurate examination than are the ordinary men scattered throughout the country. I do not wish to discredit the roster doctors because they are a useful part of the organization and a convenience to the people in their homes. If they find any difficulty they can always refer to our own men.


John Power Howden: I was just going to ask if the majority of these examinations were not actually made -by the roster doctors in the various parts of the country.


Murray MacLaren: Last year the roster
doctors made 1,263 examinations.


Joseph Raoul Hurtubise: With regard to Canadian doctors who have been appointed to posts in different European countries, I should like to know if their travelling expenses to their posts and back to Canada are paid by the government.


Murray MacLaren: Their expenses are paid when thej'- go but I think the practice has varied with regard to their expenses back; some have been paid and some have not. Some of them have asked to remain where they were sent, and naturally their return expenses were not paid. I do not wish to make a definite statement; I know their expenses are paid when they leave here, and on returning I think they are made an allowance for travelling expenses that is considered fair and reasonable.


Joseph Raoul Hurtubise: Is it understood that
when they retire or are dismissed their return expenses are paid?


Murray MacLaren: They are paid when they are sent over.


Joseph Raoul Hurtubise: But what about their return expenses?


Murray MacLaren: I am not quite sure;
I will have to look that up. I believe in m-ost of the cases some allowance has been made.
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Abraham Albert Heaps: I should like the minister
to give the committee, if he has the information, the number of examinations made by Canadian government doctors of persons emigrating to this country. I think the minister did give one or two ports, and I should like to have the total.


Murray MacLaren: I have the figures here
of the immigrants arriving at Canadian ocean ports.


Abraham Albert Heaps: I do not want the number
of immigrants arriving at Canadian ports; I want the number of emigrants examined by Canadian government doctors at the various points in Europe where they are stationed.
Mr. MacLAREiN:	There were 824 examinations in London, 321 in Liverpool, 475 in Glasgow and 230 in Belfast, or a total of 1,850.


Abraham Albert Heaps: Has the minister the information with regard to the other ports?


Murray MacLaren: There were 1,263 examinations by British roster doctors and 2,908 examinations by Canadian medical officers on the continent.


Abraham Albert Heaps: I notice that at some points there are only eight or ten examinations a week. Are we paying those medical officers $3,400 a year to make those examinations?


Murray MacLaren: They are paid that
salary, which includes their living expenses and rent, and which in the case of married men supports their families.


Abraham Albert Heaps: If about 400 examinations
are made at a cost of $3,400 a year, does the minister not think that is rather expensive as far as the government is concerned?


Murray MacLaren: These men are qualified medical practitioners and the positions cannot be filled except by those who have acquired a medical education. I believe these men are worth their cost which in any case is not large. What was my hon. friend's calculation as to the number of examinations?


Abraham Albert Heaps: In Belfast there were only
230 examinations a year.


Murray MacLaren: I am taking the total,
which is 6,021. If that is divided among the eight medical men it means something like 752 examinations by each man per year.


Abraham Albert Heaps: That is just a little over
two a day, is it not?


Murray MacLaren: It must not be assumed that this is the only work they do. They have charge not only of the seaport at which

they are located but of a large area in addition, and they supervise and check up the roster doctors. I do not say it is a very laborious position, but the work is necessary and important. I think the exclusion of unhealthy people is an important matter, and I do not know of any other system by which you could carry on this work at the same low cost.


William Thomas Lucas: I notice that the vote for the administration of the acts respecting quarantine and leprosy has been reduced iby $12,000. Has there been a reduction in the number of lepers in Canada. Where are lepers housed at the present time, and is scientific medicine making any progress in curing the disease?


Murray MacLaren: At the present time there are fifteen cases of leprosy in the two lazarettos, one at Tracadie in Gloucester county, with which the hon. member for Gloucester (Mr. Yeniot) is familiar, and the other at William Head in British Columbia. The cases at the William Head lazaretto are confined to Chinese, there being five of them. Of the ten at Tracadie only four are Acadian. The history of leprosy goes back about ninety years in that area of the country. I can recall visiting Tracadie lazaretto about thirty years ago, at which time there were between twenty . and thirty cases, all from the surrounding district. To-day out of a total of ten there are only four cases which have come from the sea coast area, or are connected with Northumberland and Gloucester. It is interesting to note that the last case from the surrounding country was in the year 1919. In other words, there have been no new cases of leprosy drawn to the attention of the authorities for fifteen years. That, I suggest, is a hopeful outlook, and I believe we may look forward with confidence to the disappearance, within a reasonable number of years, of the affliction. In most cases the illness is long, and ten years is not long in its history.
Then, I believe I was asked the results of treatment. My reply is that more especially in recent years, good results have been obtained. Occasionally the case becomes quiescent or inactive, and I believe this development is becoming more prevalent.


William Thomas Lucas: Have any cases been cured?


Murray MacLaren: I would rather put it this way: Have any cases been arrested? If I asked my hon. friend how many cases of tuberculosis were cured he would not answer me. He would say, "Well, they have been arrested, or apparently cured." To say that

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an ailment is cured is making a very strong statement, especially when we are referring to tuberculosis or anything of that nature. I say that the progress of the application has, in some cases, been arrested and, in a few, apparently cures have been made. I do not like to say definitely however that a cure has been made.


William Thomas Lucas: Have they been arrested sufficiently to leave the hospital?


Murray MacLaren: Yes, several of them. I am reminded that one patient is leaving Tracadie to-day because of the fact that the condition of the patient has become arrested. Sometimes patients are examined for a year or longer to make sure that the bacillus of leprosy is not present.
Mr. VEiNTOT: Mr. 'Chairman, I must come back to the appointment of a medical officer at Tracadie, because I feel it is of great importance that a permanent appointment should be made immediately. In order to back up my statement I wish to place on record a certificate signed by J. J. Heagerty, chief executive assistant, Department of National Health. On the same certificate are ithe words ''I concur" over the signature of "Mr. MacLaren, Minister of Pensions and National Health." The certificate is as follows:
Certified that the position of medical officer, grade 1, Tracadie, New Brunswick (H-Q-95), will become vacant on November 23, 1932, in consequence of the retirement of Doctor J. A. Langis.
I am now referring to a permanent appointment.
This position is that of medical officer in charge of the leper station at Tracadie and it is considered that the public interest will suffer if the position is not filled.
Then, the following is a letter dated September 15, 1932, from J. J. Heagerty, M.D., chief executive assistant, addressed to the secretary of the civil service commission:
Your File H-Q-95
Dear Sir:
With reference to your communication of the eighteenth August, regarding the position of medical officer, grade 1, at the lazaretto, Tracadie, N.B.
I am now forwarding requisition for permanent appointment in this case. It is essential that this position be filled by a permanent appointee and I am attaching a certificate signed by the hon. the minister to this effect.
As Dr. J. E. Hache has been declared the successful candidate, it is requested that a certificate of permanent appointment be issued in his case, with effect from the 23rd November, 1932.
This position is included in the recommendation to the treasury board', as called for in the minute of that board dated July 18, 1932, and provision for salary has been made in the vote concerned for the present fiscal year.
I have another letter on the file, dated Ottawa, September 30, 1932, and addressed to J. A. Amyot, deputy minister of Pensions and National Health, and signed by W. Foran, secretary of the civil service commission. It reads as follws:
Dear Sir,-
Re permanent filling of a position of medical officer, grade 1, Tracadie, N.B.
With reference to the question of the filling of the above position in connection with which you forwarded a requisition for permanent appointment, 6-275-B of the 15th instant, I am directed to ask you to advise as to the grounds on which you consider it necessary to make a permanent instead of a temporary appointment to this position.
The reply to that from Doctor Heagerty, addressed to the civil service commission, is as follows:
Ottawa, October 5, 1932.
Your File H-Q-95
Dear Sir,-
I have your letter of the 30th September, on the subject of the application made by this department for the permanent filling of the position of medical officer, grade 1, Tracadie, N.B.
The appointee to this position is responsible for the custody and treatment of lepers detained at the lazaretto. This calls for his full-time services, and he is not allowed to engage in private practice.
As the lazaretto is more or less isolated, during the winter months especially so, the medical officer in charge is called upon for a certain amount of self-sacrifice in the appointment of his duties.
One essential point is that the patients should have full confidence in the physician who is in daily contact with them as the medical treatment given is one of long duration and, very often, difficult to administer.
For the reasons given above it is considered advisable that only when absolutely necessary should a change be made in the appointment of the medical officer in charge of the lazaretto, and this vacancy therefore should be filled by a permanent appointment.
That was on October 5, 1932. I maintain, sir, that this position has been filled by temporary appointments since, I think, the month of September 1932, and I claim that now owing to the importance of the position, and basing my argument especially on the reasons given by the minister himself and by his officials as to the importance of a permanent appointment being made, no longer should there be a temporary appointee in charge of the lazaretto, but a permanent appointment should be made forthwith. I un-

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derstand that the doctor in charge is quite capable, and I have no criticism to make of him. I suggest that he should receive the permanent appointment not only to carry out the wish expressed by the minister himself in 1932 but also to satisfy the needs of that institution.
Ml-. MacLAREN: I am pleased to say, Mr. Chairman, that I am most willing that the medical officer there should be appointed permanently. He has been satisfactory, and has been well received by the people of the community. My understanding is that at the present time he is holding a permanent position temporarily, if I may say so. It has been the practice of council in the past year or more to make no permanent appointments, and that is the only reason that this official has not been appointed absolutely permanently. I shall, however, make another effort to have this appointment confirmed permanently. I am quite satisfied with the incumbent, and I am simply pointing out that the practice has 'been very general in the last year or two that appointments to the civil service have been temporary and not permanent.


Peter John Veniot: With further reference to this appointment at Tracadie and to temporary appointments, in order to set out the position correctly I wish to place on Hansard some of the communications which I find on this file in connection with the first temporary appointment. At page 28 of the file I find a letter signed by Doctor J. J. Heagerty,
M.	D., chief executive assistant, addressed to the secretary of the civil service commission, Ottawa, and reading as follows:
Ottawa, November 21, 1932.
Dear Sir,-
With reference to your letter of the 30th September and my reply thereto of the 5th October, regarding the permanent filling of the position of medical officer, grade 1, Tracadie,
N.	B., rendered vacant through the retirement of Dr. J. A. Langis:
I should be glad to know if a certificate will be issued in the case of Dr. J. E. Hache. I would point out that at the present time Dr. Hache is occupying the position under temporary certificate which expires on the 30th instant, and this department, therefore, has no authority to pay his salary beyond that date.
I wish to put on record another letter signed by W. Foran, secretary of the civil service commission, addressed to Doctor Heagerty, and dated November 23, 1932:
Dear Sir,-	_	_
With reference to your communication of the 21st instant, file No. 6-275-B, and previous correspondence recommending the permanent appointment of Dr. Joseph Edmond Hache as

medical officer, grade 1, in the quarantine branch of Tracadie, N.B., I am directed by the commissioners to inform you that in view of the particular nature of the work which this employee is performing they have agreed to his permanent appointment, effective the 23rd November, 1932.
A certificate of permanent appointment will be issued in his favour when the necessary evidence regarding his age, health and character is on file, in w'hich connection Dr. Hache will be communicated with direct.
At page 26 of this sessional paper there is a letter signed by Doctor J. J. Heagerty, chief executive assistant, and addressed to J. E. Hache, leprosy lazaretto, Tracadie, N.B., and dated Ottawa, November 28, 1932:
I am informed by the civil service commission that a permanent certificate covering your appointment as medical officer in charge of the Tracadie lazaretto will be issued when the necessary evidence regarding your age, health and character has been furnished to the commission.
In order to prevent any delay, would you please have that information sent to the commission as soon as possible.
Another letter dated Ottawa, December 28, 1932, signed by Doctor Heagerty, and addressed to the secretary of the civil service commission, reads as follows:
Dear Sir,.-[DOT]
With reference to your letter of the 23rd November regarding the permanent appointment of Dr. J. E. Hache, as medical officer, grade 1, at Tracadie, N.B., I should be glad to know' if you are yet in a position to issue the necessary certificate.
Which all goes to show, Mr. Chairman, that the department was anxious to have a permanent appointment made, and all the more reason now that that permanent appointment should be made without any further delay.
The next letter appears on page 22 of the file. It is dated January 17, 1933, and is from Doctor J. J. Heagerty to the secretary of the civil service commission. It reads:
Pending the settlement of the permanent appointment of Dr. J. E. Hache, medical officer, grade 1, at Tracadie, N.B., it is requested' that the temporary certificate issued in his case be extended for a period of two months from the 1st January, 1933, in order that this department may be in possession of authority for the payment of salary due.
The next letter is found on page 21. It is dated January 25, 1933, and is from Doctor J. J. Heagerty to the Honourable Doctor W. J. Roche, chairman of the civil service commission. It reads:
As the department is of the opinion that Dr. Joseph E. H. Hache, who is occupying the position of physician to the lazaretto at Tracadie, N.B.. in a temporary capacity and who, as a result of a competition held by the civil service commission lead the eligible list

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for permanent appointment, is unsatisfactory, I would request that you kindly arrange to reconvene the board to again consider the matter.
If you will have the kindness to notify Dr. Hache at the earliest moment that his services are unsatisfactory, I shall be obliged. May I have a copy of the letter you send to Dr. Hache.
There then follows a letter from Doctor Heagerty to Mr. Foran of the civil service commission. This is dated January 27, and reads:
Re:	Position of physician to leper
lazaretto, Tracadie, N.B.
Competition No. 22,160
Dear Sir,-
I am informed that Dr. Bourgeois. Tracadie, N.B., was one of the applicants for the position of physician to the leper lazaretto at Tracadie, but that his application arrived too late for consideration by the board.
As the services of Dr. J. E. Hache, who was temporarily appointed, have not been satisfactory, I have requested that the board be reconvened. Meanwhile, if it is permissible to do so, I should be obliged if you would let me have, confidentially, particulars regarding the qualifications of Dr. Bourgeois and the recommendations submitted in his case.
The commission replied that they had no record of Doctor Bourgeois having made an application in the first instance, and, therefore, the commission could not make any recommendation or give any details in that regard. The department had expressed in one of the letters the desire to have a temporary appointment made from the eligible list but then asked for recommendations from the commission with respect to Doctor Bourgeois and not with respect to the other applicants who were on record in the department. My main object in placing these letters on record is not so much criticism of the action taken by the department as to emphasize the necessity of having this appointment immediately made permanent. I desire to thank the minister for having stated that he will endeavour to have this done right away.


Mr. ROSS:: There is one item covering
public health engineering service, and I should like to know just what that includes.


Murray MacLaren: This appropriation is
for the administration of the Public Works Health Act. It covers supervision as regards public health on railways, boats, ships and all other methods of transportation, and includes the enforcement of the regulations concerning water for drinking on vessels navigating the great lakes and the inland waters and on common carriers engaged in international and interprovincial traffic. It covers the supervision of the federal public
buildings with a view to promoting the health of civil servants and other government employees. It includes the enforcement of the rules or regulations made by the International Joint Commission pursuant to the treaty between the United States of America and Canada in connection with boundary waters. It deals with questions of public health which arise between these two countries. Perhaps the most important work carried on under this vote is the controlling and checking up of the proper supplies of drinking water on the great lakes and the rivers. I think there is evidence that this supervision has been effective in the diminution of typhoid fever among those travelling on these boats.


John Power Howden: Is a grant to be made to the Canadian Council of Social Hygiene?


Murray MacLaren: Not this year.


John Power Howden: I assume that most hon.
members are familiar with the work being done by the Canadian Council of Social Hygiene. The movement originated in Toronto some years ago when a number of influential people formed themselves into a group, having realized the appalling inroads which venereal disease was making among the Canadian people and the people of the world at large. Through various forms of propaganda, such as the issuing of pamphlets and the showing of moving pictures, they managed to make a decided advance in the control and betterment of conditions. Among other activities, with the aid of the provincial and federal governments they established depots for the prevention and cure of venereal disease. The government has rightly taken control of leprosy and has provided the means to isolate and treat those who suffer from this disease but I repeat what I said in this house on another occasion, that I am perfectly safe in saying that for every case of leprosy in Canada there are probably a thousand cases of venereal disease. This disease is an even more serious menace to the Canadian people than leprosy. I appeal to the minister to reconsider his action in withholding this grant from the Canadian Council of Social Hygiene. I think better and more extensive results could be obtained by a grant to provide for venereal depots than will be obtained from a grant to lepers.


Murray MacLaren: I suppose the hon. member knows why the cases of leprosy are dealt with by the Dominion government. Naturally the department would like to assist in the amelioration of any serious condition, but the fact is that so far as leprosy is concerned
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there is no option, because it is laid down in the British North America Act; it must be. Therefore that question has never arisen. It has always been the case, and we are bound by it. The lepers were here in the country and that was the reason for carrying it on. So that you cannot compare the expense towards the treatment of venereal disease with the expense in connection with leprosy. The British North America Act says that we are to do it and it is done, and I am glad to say that I think it is quite well done. But the treatment "of venereal disease is a different matter. I know that my hon. friend from Manitoba is greatly interested, as he should be, in public health matters and would like to see adequate measures taken to treat disease, but I do not think he faces this question : Is it to be done by the Dominion government or by the provincial governments? That is the question, and we know that at the present time, with few exceptions-as regards leprosy and looking after quarantine-disease in the different provinces is cared for by the provinces themselves. All that the federal government has done, and it has done a good deal in every way, has been to give a vote by way of encouragement and assistance to these different organizations; that is all. I wonder whether my hon. friend has ever suggested that it be advocated in the legislature of Manitoba? That I venture to think is the place in which it should be started. That is where the responsibility rests; the responsibility is with the provinces. I agree with my hon. friend regarding the importance and the desirability of treatment, and I look with satisfaction at what has been done by the Dominion government in many directions. It has given large contributions to the treatment of venereal disease, $200,000 at one time, I believe,, for a certain number of years, and then the amount was reduced to $150,000 and $100,000 until it was discontinued. That was by way of helping to put the movement on its feet. The position is that the care of those diseases is provincial, much of it being for general education, and to enlist our sympathy and support. But after all it comes back to the provinces.
Mr. HOWD'EN:	The minister has just
said that the grant towards the assistance of the provinces was for the purpose of putting the movement on its feet, but unfortunately the grant was withdrawn before the movement *was sufficiently well established, and I question very much whether the provinces are in a position to carry on the work alone. In fact, it has been proved definitely, so far as

Manitoba is concerned, that the work has had to be dropped. It certainly is a matter of national health, and a matter of very serious national health, that this wrork should be maintained, not provincially but nationally, and I daresay that all the provinces in the country that can afford to maintain it will continue to do so. But there are a large number of provinces that are not able to carry on venereal work alone, and if the federal government is concerned at all about the national health, certainly here is a place it could very well expend a little money; because I do not need to suggest to the minister the very appalling inroads which this disease was making among the Canadian people and the improvement that followed the establishment of these depots. The federal government can find sources of revenue through forms of taxation which are not open to the provinces, and now that it has withdrawn its support the work has had to be dropped in several provinces, and we can almost notice, from the time the work was held up, a deterioration in the health of the people.


Arthur Edward Ross: To return to the question of
public health, does the department assume responsibility for the purity of water or food such as milk carried on the boats on the great lakes? Is there any international method by which the purity of water is controlled on boats going from one province to another or from the American to the Canadian side and vice versa?


Murray MacLaren: The engineering inspectors examine the water, taking samples of it which they send to the laboratories to be tested. They satisfy themselves, as far as it is possible for them to do so in such a large field, that the water is good and that the tanks on the steamers are sanitary. They also have supervision in connection with the water supply on ocean steamers, satisfying themselves that the water supplied to steamers is wholesome. They perform a very useful work and I cannot help feeling (that we should be better off with more of them.


Arthur Edward Ross: Would they be restricted to
supervision over certain water supplies, in ports, for example?


Murray MacLaren: Their services extend to international waters, to the large lakes, the river St. Lawrence and the seaports. I do not think they are restricted to any great extent. They have supervision over the sanitary arrangements on trains travelling from one province to another.

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Mr. MoGIBBON: I submit that either the minister should make this department worth something or it should be wiped out. It is almost useless to-day, a useless expenditure of money, and it should be one of the most important portfolios in the government. The health of the people is the greatest problem before the country. The loss from sickness, death, hospitalization and disability claims represents an enormous total, yet that colossal loss has not been dealt with by any parliament since I have had a seat in this house. I would like to impress upon the minister the importance of the job he has, and also to observe in connection with that, that the job has never been done nor attempted to be done.
The saving that could come to the people of Canada through an up to date health policy properly supported, would, to my mind, be greater than could be effected by anything else they could do. It would go a long way towards decreasing the interest on our national debt. Some years ago I figured this out and made a speech in regard to the matter, and I think the saving ran between $400,000,000 and $500,000,000 a year. The loss, however, is still going on and we in this parliament hide or protect ourselves behind the British North America Act. If we go into the provincial field, they tell us that they have not any money. Consequently the task had been carried out for years and years by the medical profession of this country. I think everybody realizes that owing to the depression this task cannot be carried out any longer by the medical profession. Hundreds of medical men are working daily and yet are on relief themselves. The task is not being and cannot be done in the way it had been in past years, yet it is one of the greatest problems we have. We vote a few dollars for purifying water, a task which is not carried out and which does not have to be carried out because the water in the different ports is looked after by the municipal authorities, and as regards the Department of National Health looking after sanitary conditions on trains, that is a joke. But I would like to impress upon the committee that in the Department of National Health there is a greater field for saving than in any other department of the government, and this task has never even been attempted. I would like to ask the minister if he cannot give that some thought and get some assistance in regard to hospitalization, premature deaths and disabilities that occur. Speaking from memory of some years back, I think about three per cent of the population are totally disabled. As regards the deaths,
forty-two per cent are of external origin and consequently could be prevented, and twenty-five per cent of our people are inefficient to the extent of twenty-five per cent practically all the time. These are matters that could be cured or prevented. Could the minister not give some attention to that aspect of the question?


Murray MacLaren: I would like first of all to point out that as regards these engineers, because it is about them that we are speaking more particularly, their work cannot be dismissed with a wave of the hand. They are doing very good work. We know water is a very fertile source of spreading disease and these men are going a long way towards preventing that.
I am asked if I will do something to enlarge the scope of the Department of National Health. What does that mean? If it means that the federal government will, from a public health standpoint, care for the whole country, I should like all hon. members to appreciate the enormous contract that would be taken on by the dominion authorities. Whether a department carries out its work well or not depends upon what it sets out to do. The department is not attempting all these things; it is not its job. I do not say that the department would do it better, but I say that in the department a great deal of public health work goes on that is uncommonly well done. There is no department that says less about its work than the Department of National Health and the officials I happen to have with me. I do not suppose it is known by many hon. members that the officials of the health department advise over the radio as far as the arctic circle and that they are appealed to from all the outlying districts as to what should be done in case of disease and so forth.
I come back to the question. If we are going to discuss it, let us be frank. It means: Will the federal government take over the public health of this country? I think the hon. member for Muskoka-Ontario (Mr. Me-Gibbon) must mean that, and if that is what is proposed, it is an enormous proposition. I suppose I should not be expected to answer that in a hurried way without due consideration, but at the present moment I would say that the federal government will not take over the work. Every portion of the country must share its own responsibility.
Progress reported.	,
C.N.R.-Annual Report


BANKING AND COMMERCE
Hon. HUGH GUTHRIE (Minister of Justice):: May I get the consent of the house to revert to motions to take up a matter that was overlooked when that order was called this afternoon?


Some hon. MEMBERS:: Carried.


Pierre Édouard Blondin: By consent, the house will revert to motions.


Hugh Guthrie: That the name of Mr. Fraser (Cariboo) be substituted for that of Mr. Stevens on the select standing committee on banking and commerce.


[Stage Direction]
Motion agreed to.
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Tuesday, March 20, 1934