Hon. W. A. GORDON (Minister of Labour):: On Eebruary 19 last the hon. member for West Lambton (Mr. Gray) asked if I would table correspondence passing between the government and the province of Ontario concerning the trans-Canada highway and also any correspondence relating to the amount finally arrived at for the monthly grant in aid. I now desire to lay the correspondence on the table.



PRIVATE BILLS


[Stage Direction]
Mr. ERRICK F. WILLIS (Souris) moved:
That the petition of the Portage la Prairie Mutual Insurance Company, praying for the passing of an act to amend its act of incorporation, together with the report of the clerk of petitions thereon, be referred to the standing

Kingston Penitentiary
committee on standing orders for the purpose of considering the suspension of standing orders 92 and 93 (3) (a) and (c) in relation thereto.
Motion agreed to.

[Stage Direction]
Bill No. 35, for the relief of Stuart Lewis Ralph Henderson.-Mr. Moore (Chateauguay-Hunitingdon).


[Stage Direction]
On the orders of the day:
Hon. HUGH GUTHRIE (Minister of Justice) :: Yesterday the hon. member for Southeast Grey (Miss Macphail) made an inquiry of me in regard to a return which I had submitted a few days ago respecting certain reports of Inspector Dawson of the penitentiary branch. The hon. member stated that while the return went up to April 8, 1934, on April 9 Inspector Dawson had an inte"'-view with prisoner 3033 in the penitentiary. I have made a pretty full inquiry in regard to this matter since yesterday, and I find that Inspector Dawson went to the penitentiary to make an inspection and report respecting a certain matter which had been referred to him. After he had concluded his inspection on April 8, an interview was requested by prisoner 3033 and it is during the course of that interview I think it is alleged by the hon. member for Southeast Grey that certain aspersions were made against her character as stated by her yesterday. I can assure her that there is no foundation for the report. The inspector himself made no report on this interview. When inspectors or superintendents visit a penitentiary, they have a large number of requests for interviews, but they do not make specific reports in regard to them. However Inspector Dawson has assured me most definitely that during his interview with prisoner 3033 the name of the hon. member for Southeast Grey was never mentioned by him or by the prisoner, there was no comment whatever in regard to her, and I can assure her on the word of honour of the inspector that there is no foundation for the allegation which she has made.



BORSTAL SYSTEM

[Stage Direction]
On the orders of the day:
Mr. J. S. WOODSWORTH (Winnipeg North Centre):: Mas- I ask the Minister of
Justice when we may expect the legislation foreshadowed in the speech from the throne in regard to the institution of the Borstal system in the (penitentiaries of this country?


Hugh Guthrie: I expect the penitentiary estimates may be up some day toward the end of the week or some day next week and I shall then be prepared to make a statement regarding the matter.



THE BUDGET

[Stage Direction]
On the orders of the day:
Mr. MAXIME RAYMOND (Beauharnois):: I understand the Minister of Finance (Mr. Rhodes) is going to bring down his budget very soon. In his absence may I ask the acting Prime Minister whether it would not be possible to have a French copy of the budget speech ready for publication as soon as it is delivered? I am sure that the French newspapermen and their readers and the whole French population would appreciate that.


Right Hon.   S@: No one would be more anxious than I to have the French version ready at the same moment as the speech is delivered or the matter discussed. But I would explain to the hon. gentleman that the preparation of the budget is always a very exacting labour, and hurried at the last moment, and it is with the greatest difficulty that the printer is able to prepare the English version and have it in proper shape to bring down here. I think I am correct in saying that the French version never has been ready at the same moment as the English. I shall inquire and see if anything can be done about it, but that is the situation. The Minister of Finance (Mr. Rhodes) has been giving his whole time to this for the last few days, and he will not be in his seat to-day, I think. He asked me to say that the budget will not be ready on Thursday, but he expects to deliver it on Friday.


Maxime Raymond: I do not like to contradict the acting Prime Minister (Sir George Perley) but I may remind him that the Hon. Mr. Robb used to deliver a French copy of his speech on the budget at the same time as he delivered the English copy to the newspapers.


Sir GEORGE PERLEY:: I shall make inquiry on that point.
C.N.R.-Auditors



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. WILLIAM DUFF (Antigonish-Guys-borough):: Has the government received any representations from the bondholders of the Grand Trunk Railway in London or from a representative thereof, protesting that they should have been consulted, under their statutory rights, as outlined in section 31, Grand Trunk Act, 1862, and Grand Trunk Act, 1873, to vote for or agree to auditors, and further protesting against the passing of Bill No. 20, as passed by the House of Commons on March 5, 1935, until they were so consulted and had an opportunity to express their wishes regarding the appointment of auditors?


Hon. R. J. MANION (Minister of Railways and Canals):: The hon. gentleman was
courteous enough to advise me this morning that he was going t.o ask this question, so I looked into the matter thoroughly in order to have a proper reply, because of the importance of the subject. Because of that importance I intend to read my reply, in order to avoid any possible misunderstanding, as it may perhaps be transmitted to London.
Two communications have been received, not from bondholders, as stated by the hon. member for Antigonish-Guysborough (Mr. Duff), but from former preference shareholders whose stocks were . declared of no value by the Grand Trunk board of arbitration, 1921. One was received by the hon. the Speaker, and the other by the hon. member for Toronto-Scarborough (Mr. Harris), as chairman of the railway committee of the house. Each made representations in the terms referred to by the hon. member for Antigonish-Guysborough.
The correspondents were informed that the appointment of auditors of Canadian National Railways had nothing whatever to do with any controversy concerning the alleged rights of former Grand Trunk stockholders, the auditors being appointed by parliament each year, as required by the Canadian National-Canadian Pacific Act of 1933. They are not company auditors, but auditors for parliament.
As to the voting rights of former shareholders, attention was directed to the fact that section 4 of the Grand Trunk Acquisition Act of 1919 reads as follows:
Provided that concurrently with such guarantee of dividends and interest upon the present guaranteed stock and the present debenture

stocks, respectively, the voting powers at meetings of shareholders of the Grand Trunk now vested in or exercisable by the holders of the said stocks respectively shall cease and determine absolutely.
This proviso was also incorporated in the formal agreement between the London Grand Trunk management and the Canadian government.


William Duff: I would like a copy of that.


Robert James Manion: It will be printed in
Hansard, if that is satisfactory.



PAYMENTS TO AUDITORS


[Stage Direction]
On the orders of the day:
Mr. C. G. POWER (Quebec South):: I
wish to draw attention to certain inaccuracies in a return tabled in this house on March 12, 1935. The return required was one showing amounts paid by the government of Canada or any department thereof to the firm of Clarkson, Gordon, Dilworth and Company or to any member of the said firm during the fiscal years 1929-30, 1930-31, 1931-32, 1932-33, 1933-34, and from the end of the fiscal year 1933-34 to date.
The return tabled indicated only the amount paid by one or two departments of the government, whereas I think it is a matter of public notoriety, if not official information, that this firm has been engaged in work in connection with the price spreads committee, and has received considerable sums of money for that work.


Hon. C. H. CAHAN (Secretary of State):: Mr. Speaker, the return was submitted as I received it from the several departments. The hon. gentleman called my attention privately to the fact that it did not contain any payments made by the price spreads and mass buying commission. I immediately requested full information in order that I might submit a supplementary return. I have not yet received complete information. So soon as I do I shall present a supplementary return.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Hon. PETER YENIOT (Gloucester):: Yesterday I drew the attention of the Minister of Justice (Mr. Guthrie) to an inter-

Minimum Wage
view given by Detective Inspector Zaneth and he said he would look into the matter. I wonder if the minister has a statement to make to-day.
Hon.	HUGH	GUTHRIE	(Minister	of
Justice):	I have asked the commissioner of
the Royal Canadian Mounted Police to make inquiry and to report to me. I telephoned him at three o'clock and he had not yet the information.



EXTENSION OF PENSION PROVISIONS AND DISTRIBUTION OF FINES AND PENALTIES

[Stage Direction]
Hon.	HUGH	GUTHRIE	(Minister	of
Justice) moved the third reading of Bill No. 9, to amend the Royal Canadian Mounted Police Act.
Motion agreed to and bill read the third time and passed.


[Stage Direction]
Hon.	HUGH	GUTHRIE	(Minister	of
Justice) moved that the house go into committee to consider the following proposed resolution:
That it is expedient to bring in a measure to provide for minimum wages pursuant to the convention concerning minimum wages adopted by the international labour organization in accordance with the provisions of part XIII of the treaty of Versailles and of the corresponding parts of the other treaties of peace, and to enable Canada to discharge the obligations assumed under the provisions of the said treaty and of the said convention.
Motion agreed to and the house went into committee, Mr. Morand in the chair.
Hugh Guthrie: This resolution is largely a formality which becomes necessary by reason of the fact that I assume there will be some expenditure from the public treasury involved in connection with the minimum wage bill which I hope to introduce as soon as this resolution is passed. The resolution is presented only to comply with the rules of the house in case any expenditure should become necessary in connection with the bill.


Mr. LAPOINTE:: Any remarks which I
intend to make will be made when the bill is before the house.


Mr. POULIOT:: I asked the acting Prime
Minister (Sir George Perley) if the so-called convention was published in the Journal of the League of Nations, and he referred me to another publication, of the labour bureau.
Would the minister be kind enough to read to the house the paragraph of the publication on which the resolution now before the house is based? It contains only four or five 'lines.


Hugh Guthrie: This resolution is based on the draft convention as reported in the official document issued by the international labour office, at page 149.


Jean-François Pouliot: Yes, but would the minister be kind enough to read that?


Hugh Guthrie: That is the long resolution which was on the order paper. It was considered by this house three days ago and adopted. The resolution was printed in the orders of the day.


Jean-François Pouliot: I know, but may I ask the hon. gentleman to be kind enough to read those four or five lines from the booklet he has in his hand?


Hugh Guthrie: I do not know which four or five lines my hon. friehd means. I shall be very glad to read them if he will tell me.


Jean-François Pouliot: If the minister will be kind enough to loan me the booklet I will read them to the house.


Hugh Guthrie: Very well, I will send it over.


Jean-François Pouliot: I will take very good care of this precious booklet, which contains the draft conventions and recommendations adopted by the international labour conference at its sessions from 1919 to 1932. The work of thirteen years is condensed in this booklet, which costs Is. 6d. or about 40 cents. This is the booklet, but it does not contain the reference given me by the acting Prime Minister, who referred to another small, very thin publication in which the matter of minimum wages is dealt with in four or five lines. The right hon. gentleman has enough legal experience to know that this draft convention does not bind us. I thought he had in his hand the official publication of the international labour bureau. This is a draft convention; it is a formula, just as I have said. I thank the Minister of Justice f-or once more confirming what I have said previously, and for his kind cooperation.


Mr. McINTOSH:: May I ask when the bill will be ready for distribution?


Hugh Guthrie: The moment the resolution is passed.


Cameron Ross McIntosh: I am pleased you have it ready.
Unemployment Relief

Resolution reported, read the second time and concurred in. Mr. Guthrie thereupon moved for leave to introduce Bill No. 40 to provide for minimum wages.
Motion agreed to and bill read the first time.



UNEMPLOYMENT AND FARM RELIEF


[Stage Direction]
Hon. W. A. GORDON (Minister of Labour) moved that the house go into committee to consider the following proposed resolution:
That it is expedient to bring in a measure respecting relief, and to provide for such payments out of the consolidated revenue fund as may be necessary for all or any of the purposes of the proposed legislation.
Motion agreed to and the house went into committee, Mr. Morand in the chair.
Jean-François Pouliot: Just one word, Mr. Chairman, and I will be through. Some time ago from the Montreal Star I quoted an excerpt from a speech by the right hon. Prime Minister with regard to the newsprint industry and the blank cheque legislation. I believe I am in order now in referring to that matter again. The quotation was as follows:
Mr. Bennett, with a chuckle, told the audience that he had had one satisfaction the other day, when representatives of the pulp and paper industry of Canada had come and asked him whether if the provinces of Quebec and Ontario request that the government do so they would make effective one of their laws which the Liberals opposed-he had the satisfaction of their asking the government to do that which Mr. King asked his followers to vote against- "and I listened while Mr. Taschereau and Mr. Hepburn asked us to make it effective in their interest-those are some of the compensations of public life, remarked the premier.
Here I have a letter from a very distinguished gentleman, a noble son of the good old province of Ontario, the Hon. Mitchell F. Hepburn, dated Toronto, Februay 28, 1935. The letter reads:
Dear Mr. Pouliot:
In reply to your letter of February 26th, I desire to make it very clear that the only correspondence I had with Prime Minister Bennett was contained in a telegram dated November 7th, which telegram was sent following representations of members of the newsprint industry who desired a conference with federal authorities. You will note that I stated that details of application of any federal policy would be open to consideration and approval by the Ontario government. No mention was made of applying the blank cheque legislation as contained in the peace, order and good government act, which I oppose in prinfMr. McIntosh.]
ciple, nor, as far as I can ascertain, in the industry itself in favour of application of provisions of this act.	.
You will therefore note that the extract from the speech of Mr. Bennett appearing in the Montreal Star, which reads:
The quotation I have read follows, and the letter continues:
... if correctly reported, indicates clearly that he did go beyond the construction I intended to put upon the contents of the telegram itself. You will further note that no representative of the Ontario government appeared at the conference in response to the invitation extended by Prime Minister Bennett.
With kind personal regards, I am,
Sincerely yours,
M. F. Hepburn.
Jean-Franqois Pouliot, Esq., M.P.,
House of Commons,
Ottawa.
That is the first part of it. Now, sir, let me read the telegram which was sent by Mr. Hepburn to the right hon. Prime Minister and which was tabled by the Secretary of State on February 15, 1935, in sessional paper No. 160:
1934, November 7. Right Hon. R. B. Bennett, Iv.C.,
Prime Minister of Canada,
Ottawa.
I believe situation of newsprint industry now makes it advisable for manufacturers to discuss problem writh you.
The Ontario government will support a policy of federal action to remedy the industry with details of application open to consideration and approval.
And that is signed by M. F. .Hepburn. This is not complete, because Mr. Taschereau was mentioned by the right hon. gentleman as well as Mr. Hepburn. I have before me a flat denial given by Mr. Taschereau along the same lines as the one given by Mr. Hepburn. It reads as follows:
(Translation):
Province of Quebec Office of the Premier
Quebec, March 16, 1935. Mr. J. F. Pouliot, K.C., M.P.,
House of Commons,
Ottawa.
Dear Mr. Pouliot:
I have your letter of the 12th instant, to which I hasten to reply.
As the file produced by Hon. Mr. Bennett show's, I neither wwote nor telegraphed to him regarding his interview w'ith the paper manufacturers. I have never, in any manner whatsoever, either directly or indirectly, approved the blank cheque given him by the House of Commons.
You are not unaware of the fact that I have been in very active touch with the paper manufacturers in an effort to find a solution to the problem existing to-day, particularly in Ontario

Economic Council
and Quebec, and to remedy a situation that threatens to become disastrous to the paper industry.
In the course of an interview at Quebec with some of the manufacturers, it was suggested that Mr. Bennett be asked to prevent the export of paper to the United States unless it was sold at a certain price which would be sufficiently remunerative to the industry. I was asked to telephone to Mr. Bennett, at Ottawa, to ask him if he would receive a delegation. I did so immediately, and Mr. Bennett told me he would receive the delegation at a date which has now escaped my mind.
_ I understand that the representatives of the industry did go to Ottawa. I took no part in the interview the delegation had with the Prime Minister of Canada.
I think the above sufficiently answers your inquiry.
Sincerely yours,
L. A. Taschereau.
Therefore the assumption by the right hon. Prime Minister that he had the support of the premiers of Ontario and Quebec was all wrong. I shall not say much about it, but I am complaining about the condition Of the lumberjacks in the province of Quebec and the conditions of all those people who have suffered since' the blank cheque legislation was passed. I shall have more to say later, but shall simply place these letters on record at the present time.
Resolution reported, read the second time and concurred in. Mr. Gordon thereupon moved for leave to introduce Bill No. 41, respecting relief measures.
Motion agreed to and bill read the first time.



ECONOMIC COUNCIL OF CANADA


[Stage Direction]
Right Hon. Sir GEORGE PERLEY (Acting Prime Minister) moved the second reading of Bill No. 39, to establish an economic council.
He said: I made an explanation yesterday regarding the purpose and intent of the bill, and when we reach the committee stage I shall be glad to endeavour to answer any further questions which may be asked.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Morand in the chair.
Section 1 agreed to.
On section 2-Definitions.
Jean-François Pouliot: I would object to anyone but you, Mr. Chairman, being appointed chairman of this council.
We have no information about that. The right hon. acting Prime Minister states, "Well, it will not cost much; it will not cost much." They say the radio commission was not to cost much, but it costs a million dollars each year. They say it effects great economy, but it is only a disturbance to the listeners over the radio. It may be a cheap proposition, and it may not cost much as the right hon. gentleman has said, but the people have to pay taxes for it. We know that some salaries are increased. May I ask what the salary of the chairman of this council will be?


George Halsey Perley: The Prime Minister is to be the chairman of the council, and actually he will not receive any remuneration for so acting.


Jean-François Pouliot: Here I object to it. If the Prime Minister is chairman of the council he cannot support himself. I say this is a most absurd proposition. Here we have a council set up to assist the Prime Minister, and yet we find that the Prime Minister is chairman of that council. So far as I am concerned that seems to be the most foolish thing on earth. We have the Prime Minister supporting himself. He will be the legs and the head of the council. The acting Prime Minister must know about this, and I must say I am strongly apposed to it. The bill provides crutches for a moribund government. If the government has no information, then the only thing it could do would be to attend a correspondence school or subscribe to the Columbia lectures, and in that way get some information about economics. When we ask them questions we find that sometimes they are like fence posts; no answers come from their mouths. I know they are not children. Truth comes from the mouths of babes, but from the mouths of the ministers comes no information. Why? It is because they do not wish to have any information and because they are kept up by patronage and other silly things, rather than giving their time to the business of the state. Every person must strongly object because people find this condition most ridiculous. We have a flood of boards; in fact it would seem that we are to have a soviet government in Canada, a government by irresponsible men who will dictate the policies.
Yesterday we heard a great, deal about statistics. I wonder if the acting Prime Minister knows how those statistics are compiled. He may receive information from the bureau of statistics and then do his own thinking upon them. Then, if the Prime Minister cannot act the chairman would be, ex officio
Economic Council

the acting Prime Minister. I wonder how he could do his work without the assistance of that council. I am sorry to have to make these observations because I realize he is older than I am, but I know any member other than a cabinet minister could dispense with the council. When they ask for a steak is it necessary to have someone cut their meat, in order that they may have a mouthful which would not choke them? They are just like children; they do not know how to work, and they must have some people to cut their meat, just as children would have. What a spectacle before the country! Here we have a government, it has been said, of supermen, men far above the average. But they cannot do anything for themselves. They have to be run about in the wheel chair of bureaucracy. They need a tutor and a guardian. Tutors and guardians are only appointed for children who are not of age and for those who cannot attend to their own business. But here we have a government of supermen, semi-gods, and they are asking for relief; they complain that they have too much work to do. I sincerely hope from the bottom of my heart that the acting Prime Minister and his colleagues, some of whom are able men, will not insist on this measure. They know that it is absurd. We have had enough of this stuff. We have had enough of those people who try to put false ideas in the heads of the ministers who form the government of this country. Who will take this government seriously when they submit such a bill as this to the house? I am sorry for the acting Prime Minister. I know that he does not need my sympathy because he is an able man, a superman, and therefore needs it -much less than others, but why should such a burden be imposed on him?


George Halsey Perley: May I say in
reference to the hon. gentleman's remarks that he need not be sorry for me. I would say to him that when he gets to be Prime Minister he will not be bound to keep this council if he does not wish to. He need not call it together at all unless he wishes.


Jean-François Pouliot: I enjoy very much the
atticism of the right hon. acting Prime [DOT] Minister. I have great respect for old age and I shall not reciprocate, but may I ask him a question? Will .the Prime Minister be responsible for this board mentioned in clause 2?


George Halsey Perley: The Prime
Minister is .the chairman of the board but there will be regulations for the conduct of its business and the carrying on of its meetings.

The Prime Minister is not bound to attend every meeting of this council, of course. A vice chairman can be selected to take his place.


Jean-François Pouliot: I understand also that the acting Prime Minister will ex-officio be the acting chairman of this board.


George Halsey Perley: The Prime
Minister will be chairman, and the regulations under which the council will act will provide for a vice chairman or someone else to preside at meetings in the absence of the Prime Minister.


Jean-François Pouliot: That is unfair because if
the Prime Minister is absent there will have to be an order in council appointing the right hon. gentleman as acting Prime Minister. There is now an order in -council to the effect that whenever the Prime Minister is absent he is to be replaced by the right hon. gentleman from Argenteuil (Sir George Perley).
Sir -GEORGE PERLEY: Yes, but the hon. gentleman knows very well that this may not continue. Someone else may take the Prime Minister's place in his absence.


Jean-François Pouliot: I am sorry I did not catch a word of what the right hon. gentleman said.


George Halsey Perley: I say that the hon. gentleman assumes that I shall continue acting as Prime Minister. There is no ground for that assumption whatever. After this bill is passed and this council is set up there may be some other gentleman who will act in the absence of the Prime Minister of the day.


Jean-François Pouliot: On that point I quite agree with the right hon. gentleman because there will ibe a turn of the tide at the next election, but just now I take this view. At present the right hon. gentleman is acting Prime Minister. He is so either in virtue- of an order in council which has been passed recently or in virtue of an order in council which was passed some time ago providing that whenever the Prime Minister was unable to attend to his duties he would be replaced ipso facto by the right hon. gentleman. Therefore the right hon. gentleman is the acting Prime Minister. That is my humble opinion and I am sure he will not deny it. Therefore if he is acting Prime Minister so long as this government is in power, I do not see how another vice chairman of the board could be appointed because if this legislation is necessary, if it is necessary for the government to have such an economic council, and if the Prime Minister is to be chairman of that board, the acting Prime Minister will be superseded by the vice chair-

Economic Council
man, which is absurd. It will mean that the acting head of the government will play second fiddle on the council, and that is why I object.
I think that those who have drafted this bill have been most inconsiderate of the acting Prime Minister. When he now jeers at me I shall reciprocate by paying a tribute to his high office and his high character. I regret very much that this bill is so unfair to him. May I ask any one of the seven ministers of the crown whom I see before me to propose an amendment to this bill providing that in the absence of the Prime Minister the acting Prime Minister will be chairman of this council? I think it would be most heartless of them to refuse to accept my suggestion, which is made in good faith and out of regard for the right hon. gentleman who leads the house at the present moment. I see on the government benches over there supporters from the province of Quebec. I shall not name them, but some of them are fond of speaking about the respect that we must have for the Prime Minister. It seems they have no regard at all for the acting Prime Minister, a man from their own province, the only member of the government from that province who has been acting Prime Minister of Canada. I regret very much that they are so hard upon him, and I strongly protest on behalf of the members from the province of Quebec against this injustice that is being done to the acting Prime Minister by his Tory colleagues from the province of Quebec.


George Halsey Perley: Mr. Chairman, I do not think that the remarks of my hon. friend require an answer. I do not understand what he means at all. He is very solicitous about the acting Prime Minister, but there is nothing in this bill to hurt me. Moreover I have been able to look after myself even before I knew the hon. gentleman from Temis-couata.


Ernest Lapointe: Mr. Chairman, I desire to say just one word. I would not like to disagree with my hon. friend from Temis-couata (Mr. Pouliot) but I think it is glorifying this bill to oppose it in this way. I do not think that there is anything in this bill. It is like the rest of the program of reform, and the quicker we pass it the better.


Jean-François Pouliot: May I sum up everything I have to say in one sentence, Mr. Chairman, and that is that this legislation is most absurd and it will not be swallowed by the people of Canada.


[Stage Direction]
Section agreed to.
Section 3 agreed to.
On section 4-Council.
Mr. GARLAND ('Bow River):: How does the government propose to elect the persons referred to in subsections (b) and (c)? Will this be done at the request of the organizations concerned or does the government propose to undertake the responsibility for the nomination of all persons?


George Halsey Perley: It is provided
that these appointments shall be made by the governor in council. I need not tell the hon. gentleman that when the time comes for the election, every effort will be made to get first class men. The government will take such steps as they consider necessary to select such men.


[Stage Direction]
Section agreed to.
Section 5 agreed to.
On section 6-Duties of the council.
Mr. IRVINE:: Before this section is carried I should like to suggest that the responsibilities of this body be increased. I am very glad that the government has made a move towards the appointment or the creation of a body that will do some thinking. I do not say this to be critical of the administration as I think this administration is perhaps as good as any other. Eor a long time I have held the view, as have many other hon. members, that we should have a body to do some real economic planning for Canada and I assume that this is the beginning of such a body. Section 6 sets forth the duties of the council but I do not think it goes far enough and I propose to move an amendment to add a clause Of), which will read:
Recommend to the government policies calculated to distribute the goods and services which either are now available or which may be made available as the result of our increasing productivity.


Some hon. MEMBERS:: Carried.


Edward Joseph Garland: If it is
possible, I should like to have some order from the hilarious gentlemen to my right. Perhaps they are celebrating to-morrow's dinner in advance.


Mr. STEWART (Edmonton):: We are
celebrating this bill.


Ernest Lapointe: We are celebrating
C.C.F. policies.


Edward Joseph Garland: I rise to
support the amendment moved by the hon. member for Wetaskiwin (Mr. Irvine). During this session there has been the closest unanimity in matters of legislation between the official opposition and the government.
Economic Council

Never before in my experience in the House of Commons have I observed such anxiety on the part of the opposition to support proposals made by the government. This is an extraordinary illustration of the condition to which the party to my right has, shall I say fallen or risen? I do not know into which category they should be put. They talk about an alliance between the Cooperative Commonwealth Federation and the government but let me assure them that they have always been far closer to the government than have this group. For example, they are so anxious to pass this particular legislation that they are ready to shout it through committee. On the other hand, we propose to improve it because it bears only a most distant resemblance to the suggestions which have come from this corner of the house in regard to such a council. We never envisioned such a ghost of a council as this one.


Mr. MACKENZIE (Vancouver):: This is
a shivering wraith.


Edward Joseph Garland: The hon.
member for Vancouver Centre (Mr. Mackenzie) speaks of it as a shivering wraith but he seems more than anxious to support it and have it pass the house.
I think something should be said about this measure as it seems to be merely setting up a sort of Prime Minister's brain trust and I am not at all sure that a brain trust of the character likely to be selected by the governor in council of the present administration will produce anything more than what the Prime Minister requires them to produce.


An hon. MEMBER:: An echo.


Edward Joseph Garland: Precisely,
an echo. We have had an illustration of this in the great country to the south where a brain trust has been operated and directed by just the type of mentality as one would anticipate will be directing this council. I think this will be the case whether the Conservative party is to have the direction of it or whether my friends to the right happen to come into power. A very frank report has recently been made upon the operations of the National Industrial Recovery Act. This report was prepared by the research and political division of the NRA and, therefore, has the imprimatur of authority upon it. The meat of the report is contained in seven lines, totalling ninety-five words, which appear on page 24 of the report. These seven lines sum up boldly and devastatingly the effect of the NRA and the results of the actions of the brain trust in that country. I quote:

Note that although payrolls in December, 1934, were only about 60 per cent of the total in 1926, dividends and interest were 150 per cent of their total in 1926. In short, the income enjoyed by those who received dividends and interest was 50 per cent'higher than in 1926, even though the national income has declined' nearly 40 per cent since that date and volume of production has declined by one-third ... clearly the recipients of profits have not failed to enjoy their proportionate share of the increase in industrial recovery.
That is taken from the official report of the operations of the NRA. It is very clear that in spite of the ballyhooing which has taken place in the press and the radio speeches which have been delivered, the NRA, directed as it is by a capitalistic minded government, has been directed with the idea of sustaining the profits of the few to the extent which they could be sustained and of passing on as little as possible to the masses. That that has been the result is proven by this report. I therefore suggest this thought to the committee, that any such economic council as is now being proposed under the guidance and direction of those who would continue the existing system, can mean in the long run just precisely the result that has already been shown in the United States in its attempt to do the very same thing with the system.
I could go further afield as I have done on another occasion and produce similar illustrations of the futility of attempting to regulate or direct capitalism by any economic council of any kind whatever. In short, the fruitfulness or usefulness of an economic council will depend entirely upon the policy behind its creation, the policy for which it is established. I contend with the hon. member for Wetaskiwin that the primary policy that should be the very basis of every activity of this economic council should be to ascertain first the potential productivity of the country, something concerning which we have no accurate information; to correlate those facts; to ascertain the total consumption of which the country is capable if real demand were satisfied, and to bring those two functions into harmony so as to make it possible for the Canadian people to consume the maximum quantity of what they produce. If that be the purpose of the council, then indeed it may be fruitful, it may justify the not overly enthusiastic praise of the hon. member for Red Deer yesterday when he said that he was glad to see that the proposal made by him on behalf of this section of the house was at last bearing fruit. As I heard him say that," it occurred to me that he was in the position of a gentleman who had planted a McIntosh Red and was now reaching out his hand to collect a very

Economic Council
sour and very small crabapple. That is just about what this economic council appears to be in the light of the suggestion made from this corner. We never envisioned such a thing as a prime minister's committee; we want a national council that will undertake to discover in an effective way the productive powers of the country and then advise as to how best the maximum consumption by the people of Canada may take place.
While I am on my feet, may I suggest that the idea of having this council tied up to the Prime Minister and his department shows a great weakness. This council should have complete freedom of action without direction or interference from any authority other than that which is laid down as a matter of definite policy to be pursued, a definite objective to be obtained, such as the one which has been already outlined by the hon. member for Wetaskiwin. To tie up such a committee for example to the national research council would also be a mistake. May I pause here just momentarily to take issue with the leader of the opposition? There is no relationship whatever between the character of research that such an economic council as this might do and the character of research that is carried on by the national research council. One is deductive and the other inductive as I suggested to the right hon. gentleman yesterday. In the one field of research we experiment; we take for example the livers of one hundred dogs and treat them in different ways in the hope that we may find out something. We do not know before we start what the result will be; in that type of natural scientific research we have not necessarily the faintest conception as to what the result will be, but we just keep on experimenting, trying to find something. We may have an objective, and very often find something entirely different from that which we set out to find. This type of economic research is research that is based on the ascertaining of definite facts that will be admitted. The facts having first been admitted, conclusions are to be drawn by bringing those facts together in certain order or fashion and arguing to certain conclusions. The basis for economic research must be and will continue to be almost entirely statistical and therefore factual. The strength therefore of your statistical bureau will to an extent determine the success of the work of such an economic council as this is to be. I would suggest to the government in closing on this point that there are two matters to be taken into consideration: first, the general policy to which this council should devote its work and, second, the strengthening of the one body that
can make this work possible, the research council itself. The last clause of this bill provides for the fabling of reports each year by the secretary of the council, but the wording of that clause is altogether too slack. It states:
The secretary shall prepare an annual report to the minister with regard to the work of the council during the preceding year, which report shall he tabled in the House of Commons.
In my opinion the acting Prime Minister would ibe well advised to add the words "and findings" after the word "work," so that the house would be advised from time to time, as we are justified in requesting to be advised, as to the result of the research undertaken by this body on the questions it investigates during the year. I suggest most strongly that the amendment of the hon-. member for Wetaskiwin should be supported by the government and carried by the house.


George Halsey Perley: I regret veiy much that I cannot see my way clear to accept the amendment as proposed by the hon. member for Wetaskiwin (Mr. Irvine). As the hon. member for Bow River has been the one who has explained the purpose of this -amendment, may II say in the first place that it deligh-ts me to be able to agree with him in one of the remarks he made, and that is that he does not accept the view -put forward by the leader of the opposition. I do not myself agree with the leader of the opposition and I told him so yesterday. There is this one point fortunately on which the h-on. member for Bow River and I agree, and that is that there is no relationship whatever between the- problems of scientific research and those of economic research. Therefore I consider that the suggestion put forward yesterday by the leader of the opposition that this council might be an adjunct of or in some way tied up to the council for scientific research is not a practical one. The hon. member for Bow River has made some explanation of his views on that subject, and I agree that it requires an entirely different type of mind to consider scientific problems from wh-at is required to consider economic questions.
With that reservation I find myself in disagreement with the hon. member for Bow River (Mr. Garland). This is an advisory council. I tried to explain it as fully as 1 could yesterday. It has no executive or administrative functions whatever. The work of the council will be on such subjects as may !be d-elegiated to it or on which it may be requested by the Prime Minister to report. Its object is to enable the Prime Minister
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in regard to the many problems he has to face, to have at his command a body to which he can make requests for inquiry and report about any matter of government or public interest which he thinks advisable to refer to them and regarding which they may be able to help him.
The hon. member for Bow River has referred to the NRA of the United States. But this is not that type of legislation at all. The administrators of the NRA were given great authority, and administrative functions of much importance, but the council here proposed is to have nothing of that sort. The hon. member for Bow River expressed the opinion also that this should be an independent national council with authority to consider such problems as it wishes-


The CHAIRMAN:: Order.


George Halsey Perley: He urges that this council should have freedom of action to consider any problem on which it chooses to make representations to the government. But that is not the type of body that we have in mind at all. The government itself is the best judge of what problems it should submit to this council for consideration and report. My hon. friends opposite are fond of saying over and over, to keep up. their courage, that they will be in power after the next election-


Some hon. MEMBERS:: Hear, hear.


George Halsey Perley: If that be so, they will find this body a great help to them, but they certainly do not wish to give to it the functions of the government. It should have no independent functions.
There is nothing further that I wish to say on the subject except to reiterate what I said yesterday, that this council is to be purely an advisory one; and to put anything in the bill which would suggest that they should have power to take up questions of their own volition and report and make recommendations to the government regarding methods of policy is something with which I would ask the committee not to concur.


Mr. MacNICOL:: I should like to say a few words in support of the proposed economic council. I am surprised that hon. members opposite should treat an important measure of this nature with so much levity.


Some hon. MEMBERS:: Oh, oh.


John Ritchie MacNicol: As a business man I cannot help but feel that such a council as this will be a great support to the government.


An hon. MEMBER:: They need it.


John Ritchie MacNicol: That is all very well, the present government will be here next year to make use of it.


Mr. CASGRAIN:: You are a false prophet.


John Ritchie MacNicol: Hon. members opposite, although receiving this resolution with so much levity, have not ceased to indicate on numerous occasions that they are willing to pass clause by clause without discussion important measures each clause of which should be considered carefully by those who occupy seats in this house. Every member is sent here to give his best attention and his considered judgment to whatever matters come before him, but, Mr. Chairman, there has not been either good attention or considered judgment given by my hon. friends opposite to several of the important measures that have come before the house this session, including this one.
The proposal for an economic council is not a neiw one. Hon. members opposite seem to indicate by their actions that they think it is something new, but the proposals to establish an economic council were not considered in other houses with the levity with which hon. .members opposite have treated this resolution. In Germany an economic council was set up in 1919, in Jugoslavia in 1921, in Poland it was considered about the same time but it was not carried into effect. Both Spain and Portugal established economic councils in 1924, France in 1925, Italy in 1930 and Great Britain in 1930. Surely all those great nations did not consider a matter of this kind something to be laughed at and passed without any discussion. Those are great nations, and they must have considered that such a council would be of benefit in promoting industry and providing employment. It is that function of an economic council in which I am interested; if it does not provide employment by promoting industry I am not interested in it, but I am interested in anything which will promote employment. Hon. members on the opposite side know as well as do hon. members on this side that one of the main purposes of our being in session to-day is to promote employment-


Mr. PQULIOT:: We hear you, but we do not know yet what you propose to do.


Raymond Ducharme Morand: Order.


John Ritchie MacNicol: If the hon. member keeps on talking on everything as much as he has talked this session, as a general authority on every subject that comes up, this house will never get anywhere.

Economic Council


Jean-François Pouliot: Well, we are going together.
Mr. MadNiICOL: Also I should like to tell the hon. gentleman tibat I do not interrupt him when he is talking and I would like to receive the same courtesy from him.


An hon. MEMBER:: He is the leader of the opposition.


John Ritchie MacNicol: In 1931 the United States government under President Hoover appointed a Senate committee to consider this same subject. The United States Senate is composed of big men. It is one of the greatest second chambers in the world. It has more legislative authority than any other second legislative chamber in the world. That Senate committee considered for some time, the subject of the establishment olf an economic council, and made a thorough and exhaustive survey, inviting to appear before them the most outstanding business men in the United States, the leading agriculturists, professors, labour men, and leading mem in all walks of life. After debating for several months they recommended to the government that an economic council should be ap= pointed. Whether that recommendation has been carried out I canniot now say definitely. What they did say iwas the objective of such a council:
We propose a national economic board, appointed by the president with the advice and consent of the Senate, and with preliminary advice from various national organizations. The members should represent special types of expert knowledge rather than special economic interests. They should include men expert in finance, scientific management, labour relations, economics, and agriculture or agricultural economics.
How if such a board is constituted with good intentions, as I believe is intended by this government, 1 cannot see how anything but benefit could result. All hon. members of this house give their best judgment, or they should, to the proposals that come before them for legislative action, recognizing that one of the principal purposes of governmental action is to provide employment for the citizens of the country. Having that in mind I cannot see how anything but benefit dan result from any government enrolling in support of the cabinet the ablest men obtainable from outside to give advice as to ways and means of providing employment for the citizens. Yet here we have this proposal received as if it were a joke. I deplore that attitude. As an ordinary business man I feel that members of this house should get down to the purpose for which they are here, and legislate in the interests of our people. Certainly
calling "Carried" to everything that comes up merely in order to get it through so that the session may be ended, in the expectation that there will be an early election, is not their purpose here. I will tell hon. gentlemen that the people of Canada are carefully scanning what goes on in this house; they are listening to what is being said here and they are not at all in accord with the attitude of the opposition who call "Carried" to most everything that comes up. Hon. gentlemen opposite will learn soon enough that there is to be an election this year; I am not a prophet but I will tell them that when the bell rings they will have a merry dance throughout the country.
In his remarks the hon. member for Bow River (Mr. Garland) became more or less mixed up; he started comparing this measure to the NRA. I spent some time in Washington when the NRA was up in congress; I also had conferences with a number of leading members of congress and of the senate, and I can say that this economic council is not at all an NRA matter, so why try to draw a red herring across the trail in order to promote opposition to a bill which I believe will be of some considerable benefit to the country. I am happy indeed to support this measure; I feel confident that when the government enrolls in its support or rather as a source of advice and information the able men it undoubtedly has in view, to meet with members of the cabinet and others on questions of business, of employment, of agriculture and of commerce, some good will be done which will benefit this country.


William Irvine: Just before my amendment is carried, Mr. Chairman, I want to make it clear that I am not arguing that there is no benefit to be expected under the bill as proposed. I think we all will be quite ready to admit that a body that studies, investigates, reports and advises upon questions relating to the general trend of social or economic conditions or to any social or economic problem of Canada, and that authorizes investigations in that behalf is a body that will be of service. Further it is provided that this body shall make recommendations to promote and coordinate social and economic research within Canada; that it shall make representations to coordinate the activities of a social or economic dharacter of the several departments of the government of Canada. That is all to the good. The body also is to make recommendations as to the organization of statistics as the basic data required for social and economic investigations, and to publish such reports and findings as may be considered to be in the public interest.
1S42
Economic Council

These things are all to the good, but I do not think they are good enough. The acting Prime Minister points out that the idea the government have in mind is very different from the idea proposed in the amendment I moved; he says that the body the government envisage is of a different type from the body indicated in the amendment. That may be so, in which case I am not as interested in the legislation as I otherwise would be. But even if my amendment suggests a body of a slightly different type, if it is a better type perhaps the government might be persuaded to change their mind. I should like to see one government sufficiently broadminded to enlarge its legislation in line with a suggestion by a private member, if that suggestion should be a little better than the suggestion of the government, and I think this is a little better, not because I moved it but because the great problem of Canada is what it is and because of the fact that due to our failure so far to solve that problem this is the greatest thing before the people of Canada to-day.
I think we ought to settle what is the objective of this body. I disagree with the acting Prime Minister when he indicates that it is a prime minister's problem that is to be solved. It is not a prime minister's problem with which we are dealing. I have no objection to any prime minister who may be in office having at his disposal and command all the technical assistance that he requires; I think he ought to have that assistance in the performance of his specific duties, but presumably we are making provision for the appointment of a national council to deal with the national problems of this country, the problems of the people of this country, and in my opinion such a national council will fail in its real service to [DOT] the people and will not be worth the cost of its maintenance if it is merely the echo of any government.


George Halsey Perley: I am sure the
hon. gentleman does not wish to be unfair. I think if he will read what I said he will find that I made no suggestion that this should be a prime minister's council. Rather I suggested that it should consider the problems put before it by the prime minister, which are the problems of the people of this country that we are all anxious to solve. Therefore I would ask the hon. gentleman to change what he said a bit, because I never suggested that this should be a prime minister's council.


William Irvine: I shall be very glad to
change anything that may look like misrepresentation, because I assure my right hon. friend that I had no desire to misrepresent

him in the slightest degree. I think perhaps I should have said that the interpretation of the council's functions as given by the acting Prime Minister appeared to me to reduce it to nothing but a prime minister's council.
May I make that point clear in this way. Supposing this legislation is passed in its present form; the Prime Minister, whether he be the present right hon. gentleman, the leader of the opposition or the hon. member for Winnipeg North Centre, as soon as he takes office becomes chairman of that body, and immediately the council is tied to the policy of the government in office. If it should happen that the present Prime Minister or the leader of the opposition should be the chairman of that council then the very first thing the council will have to do will be to find policies that do not disrupt the policies of the government. Policies that might save this country might have to disrupt the government, but if the Prime Minister has been elected on the basis of maintaining the capitalistic order and his advisory council comes along with policies adverse to that idea, then immediately they are against the spirit and will of the government of the day and no attention will be paid to their work. Indeed, they will not do any work along that line; all their energies will be devoted to trying to find some way of dealing with capitalism as it is without making any changes which might be warranted by the economic facts. I am contending, Mr. Chairman, for a council that will be free to advise on the facts that are at hand, and to advance policies based upon those facts, whether or not they be acceptable to the government of the day. I do not say the government should be compelled to accept the findings of the council, tout I do say those findings should be made public, and the data upon which the findings are based should be known to everybody. A government which refused to accept the recommendations should accept the responsibility entailed therein. Otherwise I do not believe the council would be of very great service to the Canadian people.


George Halsey Perley: May I remind the hon. member that subsection (e) of section 6 provides that the council shall publish such reports and findings as may be considered to be in the public interest.


William Irvine: That was the point upon which I was making my claim, namely, that provision is already made. I do not wish to be understood as advocating that the deliberations and recommendations of the council should be obligatory upon any government.

Economic Council
On the other hand the council should be free to make whatever recommendations the facts at their command warrant; they should be free to make the recommendations public, and then the government should take the responsibility for accepting or not accepting such recommendations. I believe firmly that if a carefully selected council, such as is here suggested and as will no doubt be appointed, were commissioned to find a way to distribute to the people of Canada the goods which those people can produce, such council could find a way to do it. It could, if it were left alone. Until we do have such a council and proceed on a basis of fact rather than on a basis of party tradition we will not find a solution for the problems with which we are confronted to-day. I would urge that the government change its mind in this regard. Such a change would ensure a better council than is now indicated; certainly it would not be a worse one. I do not see any common sense in a government taking the position that it will receive no suggestions from any outside people, and that the bill must go through exactly as it appears on its introduction, no matter how many improvements may be suggested. The government would not be harmed, indeed it would be helped, if the bill were improved as hon. members in this comer of the house have suggested. I again urge the leader of the government to reconsider the decision he has indicated to the house, and to allow hon. members at least to vote on the measure according to their individual ideas and not on party lines.


Robert James Manion: Mr. Chairman, I wish to say a few words concerning the bill, not because the explanation given by the acting Prime Minister lacked anything, but because I have been surprised this afternoon when I have listened to hon. members opposite ridicule the measure. I am in entire agreement with the hon. member for Toronto Northwest (Mr. MacNicol) who s>poke only a few moments ago. We have before us a bill which hon. members opposite are attempting to ridicule out of court. Other bills which have been brought before this chamber and have been described as measures of progress and reform-the unemployment insurance bill, the eight hour day bill, and various others- hon. members opposite have tried to destroy, by declaring them unconstitutional. This measure they cannot prove unconstitutional, so they attempt to ridicule it out of court. If I may say so-and I am speaking as seriously as I have ever spoken in this chamber-to my mind this bill, far from being worthy of 92582-117
ridicule is the best measure we have introduced. I make that statement in all sincerity. The government has introduced progressive measures which may not have 'been as satisfactory as hon. members opposite or some hon. members in the third party might have desired. In that class we had the unemployment insurance bill, the eight hour day bill, and so on. No matter what may be said about them the fact remains that they were progressive measures, and were in line with present day world progress. I say the bill now before us is just as much in line with world progress, or even more, than the proposals contained in any other bill.
I remember, sir, that which apparently hon. members opposite seem to forget on all occasions, namely, that this world has been going through a period of crisis the like of which has never before been known. We have been going through an economic hurricane which has never been equalled. To-day that is but a platitude; every person admits it. Changed conditions require changed laws. The rest of the world absorbed that idea long before this; according to my information thirty-nine countries have instituted bodies similar to the one suggested in this measure. I admit quite freely that the bill may not make perfect law. After all, no government bringing in a measure expects perfection at the first attempt. I have no doubt imperfections will be found in it, and I have no doubt that some of the suggestions offered by hon. members in the third party, members who take a more constructive stand than do hon. members opposite-because their stand is entirely destructive-may ultimately be found necessary. I am free to make that admission. I must say, however, that some hon. members in the third party are destructive to a degree which does not serve them well and is not worthy of their ability. The hon. member for Bow River is notably one of those. He has an acute mind and a fine gift of speech, but I must say to him in a friendly spirit that the last few times he has discussed measures in this chamber he has adopted a destructive attitude not worthy of him and one which I believe will in the long run do him harm. For example, I will illustrate what I mean. To-day he finds fault with the whole bill because it is not perfect. I admit it is not perfect. I suggest that perhaps no two hon. members of the house would draw a bill in exactly the same language. But we must remember that the hon. member took the same attitude in regard to the unemployment insurance bill. Because it was not satisfactory to him and because

Economic Council

it did not embody certain ideas which he thought should be incorporated he voted against it. He and two other hon. members opposed the measure; I refer to the hon. members for Temiscouata and Labelle. I do not criticize them for voting against the measure; that is their privilege. I must say, however, that at a time like this, the position taken by the hon. member for Bow River, namely, that if he cannot have a bill passed one hundred per cent as he thinks it should be he will vote against it, is not worthy of his ability. I mention these points in a friendly way, and merely make the observation that his action does not constitute constructive criticism nor is it constructive in any way.
Hon. members opposite do not pretend to be constructive. In the last four or five years they have never pretended to be anything but destructive. For six sessions-and on many occasions they have referred to the fact that we have had six sessions-they have done nothing constructive. Their whole attitude has been one of fault finding and destructive criticism-nothing else. I do not expect better from them, but I do expect better from the hon. member for Bow River, a man of great ability and one who, for his own sake, I suggest might exercise a little more constructive effort, if he wishes to have legislation passed as he would like to have it.
The reason I felt impelled to speak was that I consider this to be one of the most constructive measures any Canadian government has brought forward. To-day we have such problems as unemployment-and I am laying aside the railways problem for the moment. Not only in Canada but in the world as a whole is there any problem which so urgently requires solution as that of unemployment. All hon. members would like to bring about a solution. If any hon. member-and I do not care who he might be- brought forward a solution of the unemployment problem, I believe I should support it, irrespective of the other members in the house. But so far, having read as widely as I am capable of reading, and having sought the ideas of other people, economists and others, I have not yet seen a solution for this very serious, critical and vital problem of all countries. We know that there is no solution at present because all countries are to-day suffering from it at least as severely as we are. The United States has twice as many unemployed as we have, and Great Britain more than we in proportion to population, and all the other countries of the world are faced with the same problem, and to a

greater degree in proportion to population than we are. Then let me suggest that a group of men such as is proposed in this bill, if they are given a problem such as that to consider, if they give their best brains to it as fifteen men of this type will do, may well succeed in bringing forth a settlement of such a vital problem to this country and to the world in general as unemployment.
There is the question of international trade. We all know that there has grown up economic nationalism throughout the world, which was really the basis of the calling together of the economic conference held in London a couple of years ago, and which really accomplished nothing. But there are methods by which economic nationalism may be decreased, and methods by which international trade may be increased.
There is the question of international debt, the question of interest payments which have been repudiated to a great extent by many of the countries which took part in the war. And finally perhaps the most urgent question of all, and one which is in a sense bound up with unemployment, is the question of the distribution of the products which we can produce in this country and which are produced by other countries. The countries in the world to-day have the ability to produce, if they could get down to business, more of food and clothing and shelter than is required by the peoples of the industrial countries of the world at any rate. But all the countries of the world have failed in working out anything in the shape of a method by which these products can be distributed. My hon. friends in the third party have taken a very strong atttiude on this question, and rightly so. I have done it myself out in the country, and all of us I believe, the best brains in the country, our best industrial brains, our business men and economists, must endeavour to work out some solution of that problem of distribution of the products of the farm, the factory, and the forest, which we are able to produce in the vast abundance of to-day.
May it not be that this economic council which we are setting up by this bill will, by sitting down and thinking over these problems, and studying them as members of the government have not time to do, bring forward some solution, for even one of the problems I have mentioned, and I have only touched the fringe of the many problems that can be dealt with by such a council.
This council is for economic research. It has already been pointed out by some speakers that there are two types of research. We have to-day a scientific research

Economic Council
council which is conducting research along scientific lines, by experiments in laboratories and so on. But the council that is proposed in this bill is an economic research council, a council which will study social and economic laws with the object of solving those problems which have arisen because there is something wrong in the whole social and economic system of Canada and other countries. It has been pointed out by the right hon. gentleman who introduced this bill that this council is for the purpose of inquiry and report, for the purpose of advising the government and advising this parliament and indeed the people of this country. It has no governing authority. This same type of advisory council has been established in nearly all the progressive countries of the world. I made it my business while the debate was going on to look up a list of the countries which have established some such council as this. 'Germany has what they call a federal economic council; Italy a national council of corporations; France and Belgium, a national economic council, and Czechoslovakia, Spain, Japan, Chile, China and even Russia have some such council as this which we are proposing to set up. My hon. friends laugh. Some of my hon. friends in the far corner sometimes point to Russia as one of the proofs of failure in this country. I think Russia at any rate has had the sense which apparently the official opposition and some of my friends in the far corner do not seem to have, of setting up an economic council of this sort. Great Britain since 1930 has had an economic advisory council, and its purposes have been described as follows:
To advise His Majesty's government in economic matters, to make continuous study of developments in trade and industry and in the use of national and imperial resources ... and of all aspects of national, imperial and international economy with a bearing on the prosperity of the country.
That is exactly the purpose of this council. It will study the problems which the government of the day or parliament desires to submit to it.
The United States has a council of economic research. It is a private body, supported by private donations. Altogether there are 39 different countries of the world which have established such a council as this. Surely then it is not a strange thing that Canada should be the fortieth country to do it. Surely we are not to be ridiculed and laughed at if we set up a council which 39 other countries, most of them greater in population than us and many of them richer, have already set up. Here is a council to be composed 92582-1174
of seven government officials, five men from economic bodies, and three experts.
May I just say here, as one who has been in this house for a great many years, that I do not believe this parliament or this government or previous governments have made sufficient use of the very outstanding ability which we possess in the civil service of this country. In my opinion we have talked too much about the boundless ability and brilliance of the civil service in other countries, such as England particularly, and in that way unconsciously we have belittled our own civil service. I want to say here publicly to-day that in my opinion our civil service is equal to any civil service in any other country of the world. We have in this country a civil service which during the imperial economic conference held in Ottawa in 1932 so ably organized the arrangements and work of that conference that it was stated by those who attended it that never in the history of imperial conferences had the organization been so ably done. That is only an illustration. All of us can name able civil servants. We have able deputy ministers, and heads of branches of departments who are outstandingly able men, leaders in their particular field. Then is it a mistake to take seven of these well qualified officials, say the head of the statistical branch, deputy ministers and experts, and put them on a council and ask them to work together instead of working as they do at present more or less in opposition to each other? Is it a thing to be ridiculed that we ask seven of them to link up their activities with those of three heads of economic bodies, labour unions, if you like, and manufacturing associations-I am giving these thoughts just as they occur to me, Mr. Chairman, just thinking out loud-and assisted by three experts? Is the government to be ridiculed because it has had the wisdom to do what thirty-nine other governments have done? Surely my hon. friends opposite have not thought over this sufficiently or they would not take the attitude of endeavouring to kill this proposal by ridicule, just as they have endeavoured to kill by constitutional argument a number of the other reform measures of the government. Over and over again as the government has brought forward its reform measures they have shown that they are opposed to them and they have tried to make them look ridiculous, but they have finally voted for them, except the hon. member for Temiscouata (Mr. Pouliot) who had the courage to vote against the unemployment insurance measure. And they will not vote against this measure. They are trying instead to kill it by kindness, to behead it by ridi-
Economic Council

cule. Their attitude is: We are all for this, but we want to chop off its head. That is not killing, according to their point of view. I trust that my hon. friends will be able to see as clearly as I do the importance of an economic body such as this, which it has been found well to set up in thirty-nine other countries of the world, Canada making the fortieth. I suggest that they do not take the attitude of belittling an organization such as this which can certainly do no harm, and to my mind must inevitably do some good for the people of this country and for the government and parliament of Canada.


Charles Gavan Power: The observations of the hon. Minister of Railways (Mr. Manion) and of the hon. member for Toronto Northwest (Mr. MacNicol) who preceded him should really I think cause us on this side of the house some perturbation. During the last three or four months every time that any hon. gentleman opposite stood up it was to tell us that we had never offered anything but criticism of the government, but in this particular instance we are being chided and verbally chastised for not saying anything, and we are being told with all vigour and eloquence for which my hon. friend the Minister of Railways is famous that we are not doing our duty by the country. I think the hon. gentleman will admit upon reflection that he has been somewhat unfortunate in the instances which he gave to show the need of this economic council. He said that we had a grave problem of unemployment but it seems to me that we had that in 1930. Nobody said in 1930, "I will call an economic council in order to solve unemployment." A suggestion was made that we should call a conference of premiers but the reply to that suggestion was, "Not conferences but action."


Robert James Manion: We had four conferences
of premiers.


Charles Gavan Power: The answer of those now
leading the government was that they would cure unemployment. That was the answer given in 1930, and I think the Minister of Railways will admit that as recently as last January it was stated publicly on behalf of the government that unemployment would be cured before this government went out of office. I would point out that they have not very long to go and they had better hurry. None of the reform measures which has been passed by my hon. friends has been of any value in providing a cure for this problem. None of these measures has provided alleviation or even a palliative.
[Mr. Manion.)
Another perhaps more striking instance was given. It was stated that this economic council was to be set up to deal with international trade. What has become of blasting? It was stated from one end of the country to the other that we were going to blast our way into the markets of the world. We did not ask for an economic council, that was to be done by the government. Canada first was the cry. In 1930 the people elected not an economic council but a blaster.


Mr. HANBURY:: A red-blooded one.


Charles Gavan Power: I should not like to talk
to the minister about being red-blooded. Anyway, it is not St. Patrick's day.


Mr. EULER:: The Irish stick together.


Charles Gavan Power: If we do not stick together, no one will help us.
In referring to international trade and unemployment, my hon. friend was good enough to say that all countries

I assume this includes Canada-failed in the solution of these problems. I take that to be an admission on the part of the government that they who were to settle these two most important questions which confronted the people in 1930 have failed. IIow are they going to remedy a situation which they have not been able to improve? According to the Minister of railways, they are going to remedy it by setting up an economic council.


Robert James Manion: No, I said they were going to study it.


Charles Gavan Power: The economic council is
going to study these matters. Surely when hon. gentlemen opposite came into office in 1930 and stated that they had a cure for these things, they must have studied these questions. Is this studying to take place only after decisions have been arrived at, only after legislation has been introduced and passed and only after the country has been committed to a definite course of action?


Ernest Lapointe: There is the general
elections.


Charles Gavan Power: The government may have
some use for it between now and the general elections. For instance, it may be necessary to summon Sir Herbert Holt to tell them about the Bank Act and the Bank of Canada.


An hon. MEMBER:: Or Beauharnois.


Charles Gavan Power: It may be necessary to
summon Mr. Beatty to tell the Minister of Railways what to do in connection with the railway amalgamation. The Minister of

Economic Council
Agriculture (Mr. Weir) is not present, but I suggest that in connection with bacon and hogs there is a gentleman named Sir Joseph Flavelle who might be of great use to him. He could pump salt water into things and then say, "To hell with profits." He would be a mighty good man. There are a great number of experienced men in Canada upon whom the government could call for assistance.
The hon. gentleman referred to the civil service but I do not think he needs an economic council to make the civil service work. We all know that we have very good deputy ministers. By the way, in passing may I say that the government might name a couple of deputy ministers. This would help to raise the efficiency of the service. These jobs have been kept open for three or four years in order that at some time or other the hopes of certain hon. gentlemen sitting behind the government may be fulfilled. And, incidentally, perhaps the civil service may be improved. During the course of his remarks last night, the hon. gentleman who was leading the house stated that the civil service must be put to some use. I do not know what there is to prevent the ministers from making their people work. If they cannot do that, perhaps we can find some on this side who could make the civil servants work.


Mr. DURANLEAU:: No good.


Charles Gavan Power: I do not know whether the Minister of Marine (Mr. Duranleau) means that it would be no good to try to make the civil servants work or that we are no good, but I think we can leave that to the judgment of the people in his province. We will not enter into any controversy on a question of fact which cannot be definitely settled in this house.
We were told that other countries of the world have economic councils. We find that this council was first invented in Germany and it then spread to Italy. They now have one in Russia and from there it is coming to Canada. We have nazi-ism, fascism, Sovietism and-what is the word?


Ernest Lapointe: Toryism.


Charles Gavan Power: The former Minister of
Justice (Mr. Lapointe) once had a name for it but I shall not repeat it. It is very easy to fool the people some of the time. Barnum did this when he ran his side show. His fat woman was never quite as fat as the people believed she was. He had a six-legged calf but most of the time it was supported by a stick of wood and a piece of superfluous cartilage. He had a two-headed pig which was nothing but a hog with a wart on the side
of its head. But people did not mind this, in fact they liked to be fooled. I think this is the attitude they are taking with respect to this government. There should not be any great objection to their being allowed to run their time but the fact remains that they have introduced an inadequate unemployment insurance bill, to which we have not objected seriously. They have introduced a piece of economic inanity, a sort of Lord's Day of rest bill, and some useless minimum wage and pension legislation. We now have this one.
I am sorry a man of the ability of the Minister of Railways says that this is the most important legislation. I do not think he really meant to say that it was the most important; I shall not ascribe that language to him because I do not think it would be fair to do so. But if it is considered by this government to be in any way important that they are going to take from this house power which they already have to call into consultation with the Prime Minister ten or fifteen or twenty or thirty men in order that they may confer with and advise him as to the economic questions of the day; if that is to be considered one of the important reform measures, I really feel sorry that good friends of mine sitting opposite, hon. gentlemen for whose ability, knowledge and common sense I have a very high respect, are forced through the exigencies of politics and the circumstance that they are on the eve of an election, to support suoh legislation as this and to endeavour to cram it down the throats of thie people of Canada in the manner of a Bamum sideshow.


Mr. HACKETT:: I am always delighted
to hear the hon. member for Quebec South (Mr. Power) especially when he talks in the lighter vein; he has that capacity for saying things in a way which rather tickles the imagination if it does not thoroughly convince the judgment of those who listen to him. His remarks this afternoon are in his best form; I think we can all admit that they were amusing. He has omitted however to tell us whether or not he intends to support this legislation.


Charles Gavan Power: It does not matter.


John Thomas Hackett: He has omitted to tell
us whether he considers that study, investigation and report upon questions relating to social and economic conditions in this country are matters of importance and whether these questions should be investigated seriously and continuously by the best brains at the command of the country. If he is against this
Economic Council

legislation, of course he is entitled to his opinion, but if he favours it, he has failed to communicate his intention to the committee. I fear that a wave of levity has overtaken his friends either as the aftermath of the celebration of a great festival or in anticipation of another one which I am told is in the immediate offing. I would ask my hon. friend seriously, because he is capable of being serious, whether he does not consider that these questions are worthy of study, and if they are, can he suggest a body more capable of giving them serious consideration! and of giving the country the benefit of this study than that which is indicated in the bill? It is all very well to be amusing, to be entertaining, but at times the people who have their eyes upon us expect that we should be serious and devote our attention to serious matters.
My hon. friend suggests that because all ills have not been cured, no effort should be made to cure them. I may remind him that it was that policy and its practice which sounded the knell of the administration which he followed for some years. I feel the people of this country are interested in governments and in men who will strive, and in measures which will give an outlet to the energies and ingenuity of the Canadian people in the solution of the great problems which confront us. I would not do my hon. friend the injustice of suggesting that he was serious when he attempted to brush aside these tremendous problems with a reference to Bar-num and his circus and by comparing Barnum to those who are now seeking and seeking seriously a remedy for the ills which are upon us.
We are confronted with an election. I do not know that that need be an opportunity to indulge ceaselessly in levity. The people will determine as they have done in the past, and the party and the men who are entrusted with the confidence of the people will constitute a government to carry out as best they .may the difficult task which falls upon governments. Should my hon. friend be called to office, I am confident that he would then welcome the assistance, guidance and inspiration of a body of men such as that which is indicated in the bill now before the committee. Unless my hon. friend and those who surround him are willing to say that there is nothing in the principle which underlies this bill; unless they are willing to say that the bill is entirely frivolous and worthy of contempt, then I ask them to support it or vote against it, but not treat parliament as one eternal joke.


Edward Joseph Garland: It gives
me great pleasure to continue the St. Patrick's day celebration started by the Minister of Railways. I am sorry that he was a day late. 1 thank him for the faint praise with which he has damned me; I thank him most sincerely for the gifts that he bore me on fluent tongue. May I assure him that I appreciate the compliments coming from him, and envy him his rhetoric and invective. I envy the spirit and passion with which he can join in a partisan debate when it suits his purpose so to do. I have enjoyed the heights to which the Minister of Railways has risen at times. It ill becomes him to point a finger at myself or at others for having been guilty of denunciation of any measure, for there is no other hon. member in this chamber who has ever equalled him in bitterness of invective.


Robert James Manion: I did not use the word
"bitter" at any time.


Edward Joseph Garland: I do not
oppose this bill and have not done so; what I have pointed out is that it was a pallid ghost of what we in this corner had sought, and no possible mistake can be made in the statement that the government in bringing in this legislation did not introduce it in accordance with the recommendations that had come from this corner of the house. When) the stream of irrepressible and ebullient verbosity of the Minister of Railways flows on, one is swept away by the torrent of words in which he engulfs his opponents, and while fluency is one of the qualities that I admire most in him, I have a sensation of drowning as I listen to him. But may I suggest that his illustrations were not well chosen. This bill is not patterned after the German method. It would not be so bad a bill if it were. Nor is it patterned after the Russian method, in spite of what the hon. member for Quebec South (Mr. Power) said. It is not patterned on any European model at all; it is patterned definitely after the Japanese model. May I give to hon. members of the committee the set-up in Japan for precisely such an economic council.
Symptoms of a state of crisis became noticeable in Japan soon after the end of the war; the increasing population, which made an extension of production and social welfare work necessary, brought economic problems into the foreground and made it appear desirable that persons of experience in these matters should participate in the life of the state.

Economic Council
This government is just becoming aware now of the fact that someone else beyond the government should participate in the life of the state.
An economic council was consequently appointed for the empire in 1924-
We are now in 1935.
-by imperial decree No. 70 of April 1st. Unlike the German Reich economic council, which, as a then unique attempt to establish an organic economic organization, aroused much interest and indeed gave rise to imitation in other countries, the Japanese imperial economic council was dependent, as one of the first economic institutions, on the prime minister. At the request and on the instructions of the ministers for agriculture and for trade and for finance-
It is even broader than this measure.
-and not therefore on its own initiative, it was to give opinions with regard to questions affecting the furtherance of national economy. It is, indeed, empowered itself to put forward proposals-
Which this proposed council is not empowered to do.
-with regard to matters within this sphere. This provision might, in practice, be interpreted in such a manner as to extend its rights further than the law suggests; it would be of interest to examine its activities in this direction.
I suggest that the government would be well advised to reconsider its position in this matter. A Review of the Economic Councils in the Different Countries of the World, by Doctor Elli Lindner, published by the League of Nations, points out that the economic councils in existence fall into two groups, the first group comprising those of France, Germany and Italy, which, being formed on the basis of a wide representation of economic circles, have an effective influence on national economic policy. They possess the right of initiative, and cooperate in preparing bills of an economic character before they are submitted to parliament for approval. Now that is quite a different sort of thing from this proposal. This is an emaciated, stupid, silly modification; it is a fleshless skeleton, nothing but a skeleton. When the hon. member for Wetaskiwin and others try to put a little flesh and muscle on it and develop a mind in it their suggestions are received only with lectures from the treasury benches and a torrent of words that bear no relation whatever to the facts or show evidence of study of the problem. The report continues:
There is, however, a fundamental difference between the French and' German economic councils and the council of corporations. Whereas the two former bodies confine themselves to strictly advisory functions, the
Italian council of corporations can in certain circumstances take decisions, though its powers are, generally speaking, limited by the right of veto held by the prime minister.
The second group, which is much the larger, includes a number of various 'bodies consisting of economic experts or representatives of various professions invited by the government-
As in this case.
-or by a member of the government to give their opinions on questions affecting the national economy generally or on special questions a study of which is of particular interest to the economic life of the country.
This bill belongs to the latter group. Now, while there have been economic councils of these two types in operation for many years, none of them has succeeded in solving the problem-not one of them. And they will not do so, because the directional policy in every single case has not been of a kind calculated to lead to a solution of a problem that cannot be solved under the present capitalist system. I am quite willing that the government should seek advice. I am glad it is providing itself with a crab apple since it does not want a Delicious or a McIntosh. But let it not delude either itself or the country; this economic council will not solve the problem, because the direction of it inevitably will be of the character of the government itself, and it will direct its efforts towards the stabilizing of conditions as they are in so far as they can be stabilized. That is, they will keep everything of the present system that they possibly can keep and make it operate. But it is a futile and vain attempt to make the unworkable work and is bound to fail, just as every economic council although long established has failed. But I welcome it because, if it is properly constituted, if it is composed of men of the type of mind I hope it will be, it may in time result in directing the attention of the government to the blind alley in which it finds itself.


Mr. CHURCH:: Clause 6 is the most important clause of this bill, as it relates to the duties of the council. The people of this country are paying to-day for thirty years' neglect of this problem. The government has brought down a most important bill for social and economic reform. The proposal for this legislation came from the Conservative opposition away back in 1923 in connection with the question of a national coal supply. To-day I have a return showing that 2,800,000 tons of coal were moved last year from the maritime provinces to central Canada as a result of that proposal. Then this policy came up again some years afterwards, in 1928 and again in 1930, and what did the government of that
Economic Council

time do? I shall read their reply to a question which I asked the government on March 13, 1930, with reference to an advisory economic committee along the lines of this bill. I asked:
Will the government consider the appointment of an advisory economic committee for Canada to deal with economic questions?
And the reply of the Prime Minister of the day was:
This and kindred subjects are receiving the attention of the government.
But they received no attention whatever, with the result that hundreds of millions of dollars were voted to the Canadian National Railways. Had that policy been adopted back in 1928 millions and millions of dollars would have been saved to the taxpayers of the country in over-capitalization and over-government. Looking over those years we see that no study was made of the question of unemployment, seasonal, technological or cyclical; no study was made by any federal, provincial or municipal body of the inroads being made by science and the machine on the employment of labour. The same thing is true of the housing question. Public works were constructed that had no economic value; some of them will never pay the fixed charges or the debt charges on them. Our natural resources have been given away; during the past thirty years our natural resources of the sea, the soil, the forest and the mine were given away in a haphazard manner and the people are suffering for it to-day. Then look at the power situation-a country so rich in power as Canada, with forty-two million potential horsepower and only seven million developed, and no effort looking to a national hydro power policy. No study at all was made of these questions, nor of the inroads into the earnings of our steam railways made by motor buses and truck freight traffic.
When we look over these problems we see the necessity of a body such as this, Mr. Chairman, and I appeal to the opposition to help the government pull the country out of the mire. I do not think we should depend on the federal government to do everything. Canada's national economic problems are not going to be solved by majorities in parliament; they call for wide national sacrifices and the support not only of the government of the day and the opposition but also of churches, boards of trade and all public bodies. While this body is advisory, if its services are properly utilized it may result in untold good to the people of this country, who have become aware as never before of the economic abuses that are carried on here. It has been argued that

parliamentary control has been so successful in education and finance, so why not extend it to banking and commerce, unemployment, housing, agriculture, imports and exports, radio and everything else from Dan to Beersheba? In the past we have had government commissions and departments multiplied to an unparalleled extent, not only in federal but also in provincial and municipal affairs, and I believe one of the principal problems that should be taken up by this council is the coordination of the problems of our various federal, provincial and municipal governments. If they only accomplish that task, so that we need not rely on some body away over in Geneva to solve our problems, they will do a great work. Some of these difficulties have been met by the municipalities themselves by way of contract; I refer to the problems in connection with fair wages, minimum wages, eight hour day, the elimination of sweat shops and child labour.
It seems to me that the principal fault of our parliamentary system under the British North America Act is that so far as our parliamentary institutions are concerned Canada is well on the way to being upside down. I think this council should consider parliamentary and constitutional reform such as will enable this country to solve its own problems. The question of the constitution of Canada is a matter to which I think the government should give very careful consideration. In the past we have derived very little benefit from some of our commissions because they have been top heavy with university professors and economists. If we want to do something practical we will have to rely on others than economists. Political economy is all right in its way, but it is not an exact science like medicine, chemistry or biology. These scientists argue from facts; the economist does not do so. He gives his opinion, and the opinions of economists are as far apart as the poles. So I hope this council will include some practical men ; I think in reality it should be a brain trust to help solve some of the problems of the sea, the soil, the forest and the mine. Professors are all very well in universities so long as they stick to their last, but many of them give advice on matters with which they are not familiar, and we have had a great deal of advice of that type. I think it would be better to get some practical business men together with the permanent officials, because when all is said and done the backbone of any government is the permanent staff, who carry on work that cannot be carried on by anyone else.

Economic Council
This council might well take up the question of what is to be done in regard to suitable employment for boys and girls of high school age, say up to eighteen. No study of that question has been made by any body so far as I can find out. I think they might study, investigate and report as to what should be done, in conjunction with the provinces and the municipalities, to solve that problem. To-day the youth of our country are suffering as never before. The commission might also make a study of industry. Low wages in Canada have been proved to be the cause of much crime in this country. Many children who are working in factories should be in schools, and the records show that most of our young offenders are underprivileged children, many of them from poverty stricken homes, who have been undernourished and handicapped and who have never had a chance or a steady job. So I think this body might make a report on what might be done along that line.
I believe another matter which might be taken up by this council, together with departmental officials, is the question of the evasion of our income tax by big business supermen, and trusts and high finance, in relation to unemployment. A commission in the United States studied this problem on Wall street and found that such evasion was retarding industry and trade in that country. The commission found that this led to starving industry and to very serious unemployment and was the cause of many of the evils from which that country was suffering. In my opinion income tax returns should be made public and I hope that when this council is set up it will go into that question. The brain trust in the United States, in attacking that problem, did more to help unemployment by exposing big business than was done by any other agency. In my opinion this council could do no better service than to recommend the publication of all income tax returns. We publish the facts and they are an open book in connection with sales of real estate and chattel mortgages and bills of sale, so why should we not publish the facts in connection with some in this country who are hoarding wealth and evading the payment of income tax with their financial manipulations. I believe that is one of the most important things that might be dealt with by this advisory body. There has been some talk of a union government in this country. In my humble opinion we had enough of that kind of government. Further, I believe the coordination of our two railways is impossible; I think with expanding trade and
the end of the depression the national railways will become a great asset to Canada.
Ini conclusion, Mr. Chairman, may I say that I believe this to be the most important matter to come before parliament this session. There are those in this country who, having seen the economic waste that has gone on in connection with our resources, have laid the blame on our parliamentary and constitutional system. I think one of the most important matters that might be taken up by this advisory body would be some recommendation as to the reorganization of our parliamentary and constitutional system so as to bring it more up to date, in order that we may deal with some of these economic problems quickly in a practical and modern way. At the present time the British North America Act, as we have it, is a danger to the well being of the country. I do not think we should pass on problem after problem to different public bodies, which piles up delay after delay; we should have a quick, modern way of solving our difficulties. It is this situation that prompts some Canadians to long for a dictator in this country; they see the evils which have been apparent to parliament for many years, with parliament doing nothing to check them. I might refer to the terrible condition of agricultural and railway workers and those in the mines, as well as those in industry. We as a parliament must not forget that these citizens have invested their lives in these industries, but today they are suffering because of the selfishness of some of those who are styled big business. If we are to have a brain trust now let us have some proper investigation, something like the investigation of Wall Street by the United States senate. Let us have an investigation in the same way of St. James Street, and the way big business has been responsible for some of the very evils that we hope1 to cure through legislation of this kind. Let us have a real inquiry. If the investigation I proposed in 1923, 1928 and 1930 for an economic council for Canada had been made there would have been no Beauharnois deal. The natural resources the Lord gave' us in the St. Lawrence river and in the Ottawa river were intended not for the barons of St. James Street, but for all His creatures in the country. When I proposed that we should have an inquiry in connection with the national coal supply I was told by the head of the National railways, right in the committee which had been appointed, that I was proposing a bargain lunch counter system of freight rates to carry the coal from the maritimes and Alberta to central Canada.
Economic Council

In 1823, 1928 and 1930 I asked the government of the day to appoint a body such as is now suggested, and we know what the reply was at that time. They did nothing, despite the fact that such a council had been appointed in England in the fall of 1928, and the present measure is patterned after their act. Clause 6 of this bill is almost the same as one of the clauses in the British act. The fact that they did do this is one of the chief reasons why the mother country has recovered faster than any other country. Look at what they are doing by way of supplying themselves with food. Some time ago they could not in a year produce more than a month's supply at one time, but to-day they are going over every lot and every farm in England and are making a great effort to increase their food supply to the point where they will not be dependent upon outside countries as much as they were. The farmers of Canada will not enljoy the market they used bo have in the old country. They investigated the coal and steel industries, and as a result a report was made to the British parliament in 1928. Effect was given to the report; they did not do as we do in Canada. When our officials make a report it is pigeonholed. Their report was adopted, and all sections of the country, including the church, boards of trade and labour organizations have got together to pull the country out of the mire. That is what we need in Canada, and what we would have had if the suggestion made in 1928 had been adopted by the government of that day.
Mr. MacINNffiS:	I 'believe the house
should thank the hon. member for Wetaski-win (Mr. Irvine) and also the hon. member for Bow River (Mr. Garland) for changing the proceedings from a farce to a serious consideration of an important problem. This measure should receive serious consideration. If any person does not believe it should be given serious thought then I suggest that person should oppose it and should not attempt to ridicule it.
Why is there a necessity for an economic council? Why do we find governments in many countries appointing councils of this kind? That is one of the first questions we should ask ourselves. To my mind the answer is this:	In the past, because of certain conditions, private interests were able to take care of the economic and social conditions within a country. During the last few years, however, and particularly since the beginning of the depression, private enterprise has fallen down and is no longer able to take care of the economic matters which at one time

it attended to. Private enterprise always had at its command technical advisers, economic advisers, financial advisers and men qualified to give other kinds of advice. If governments are to be called upon to do the work which at one time was done by private enterprise, then governments will have to have officials at their command. Because the government of Canada, like the governments of other countries, have so many problems to consider, I believe they should have experts at their command who would be able to give sound advice. Some hon. members, and particularly the Minister of Railways and Canals (Mr. Manion), referred to the many problems confronting Canada-unemployment, railways, transportation, trade, and finance. The suggestion was made that we should try to find a solution for these problems. In my opinion the mistake made by the Minister of Railways and Canals and by other hon. members is that of believing that these difficulties can be solved one by one. As a matter of fact these different problems are not causes; they are effects. They are conditions which have arisen out of the fundamental basis of our whole economic and social life. When you have solved unemployment you have solved at the same time the problems of trade, transportation and finance. They are linked together and one cannot be solved without solving the others.
There is only one problem which has always confronted the people of the world, and it is that of deciding how best to provide themselves with food, clothing and shelter; that problem settled we find that others fall into line and are merely detail. The problem of providing food, clothing and shelter has confronted the human race from the time of its first appearance on earth up to the present day, the only difference being that to-day we have within our grasp or at our command the means to solve the problem once and fo-r all. I believe it was the Prime Minister who said some few years ago in this chamber that at that time-and of course the same condition obtains to-day -there was in Canada industrial equipment sufficient to meet the needs of 25,000,000 people. To-day our population is only a little more than 10,000,000 people, and I submit that if we have the equipment to supply the needs of 25,000,000 people it should be somebody's business to find why we cannot use our wealth to meet the needs of our citizens. If the economic council will do that, then surely it is worth while. I must say however that I would be opposed to an economic council of which the present Prime

Economic Council
Minister would be the chairman, not because I have not a high regard for his ability, integrity and honesty, but because I feel that during the last five years he has dominated his cabinet, possibly to the detriment of legislation which has come before us. I am sure that in the same way he would dominate a council, particularly one made up in greater part of civil servants.
The point was made that we had never made use of our civil service. As a matter of fact we have never made full use of any of our resources, and if this economic council could show us how to make use not only of our civil servants but of our natural resources, our industrial equipment and our man power, both mentally and physically, then the legislation would be worth while. I would suggest again that the government consider seriously the amendment proposed by the hon. .member for Wetaskiwin. Although as drafted it may not meet with their approval I believe they should hold it over and ascertain whether or not they could bring down an amendment which would be more to their liking and would also meet the purposes for which the amendment was intended.


Mr. COOTE:: To-day it is common to hear the statement that the problem of production has been solved. That of course is only a comparative statement, but the efficiency of the productive system is so far ahead of our methods of distribution that it seems to me there is every reason for saying that the problem of distribution is the greatest one facing us to-day. In my humble opinion there is no reason why the government should not accept the amendment offered by the hon. member for Wetaskiwin (Mr. Irvine). Our scientists and engineers have gone a long way in solving the problem of production. In Canada we have over eight million horsepower of mechanical energy installed in factories and power houses. Coupled with splendid labour saving machinery we have now a production system with power behind it which is equal to the .power of eighty million slaves, to work for this nation of ten million people. We can produce goods in abundance, food, clothing, and shelter for more people than we have here, and yet we continue to endure this condition of poverty in the midst of plenty.
In 1929, so we have been told, we entered upon a period of depression due to the fact that we had produced too much. Surely it should not be necessary to say anything more than that to convince the government and members of this committee that this problem of distribution is the great one facing us. I
remember four years ago the president of one of our banks said that the depression was caused by overproduction, and he was followed a few minutes later by the general manager who said in his speech that the way out was to work harder. Now if this depression was caused by overproduction, we all know surely that we cannot get out of it by working harder and producing more. Surely the only solution is greater consumption. There is the important problem facing us. How can we get that system which will enable us as a people to consume what we now produce? I say again that is the greatest problem facing us, that of finding a better system of distribution, and I do not see why we should not state in this act that one of the duties to be undertaken by this board, which is to be called an economic council and is to advise the government, shall be to consider this problem of distribution. I certainly hope that the government will change their attitude and accept the amendment that has been offered by the hon. member for Wetaskiwin.


Mr. SPENCER:: Mr. Chairman, I cannot let the vote take .place without saying a word in support of the amendment which has been brought forward by the hon. member for Wetaskiwin (Mr. Irvine). The bill as it stands is distinctly a step in the right direction, and I shall take pleasure in supporting it, but I do not think it goes far enough. It does not really meet what is probably the most important situation facing us, and that is the problem of purchasing power, and that I believe was the idea of the hon. member for Wetaskiwin in putting forward his amendment. No doubt the bill is being introduced to-day for no other reason than that of the extraordinary situation in which this country now finds itself. We are wealthy in the matter of goods and services, but financially we are poor. There is certainly a contradiction. It seams to me that we have been thinking too much both in the past and in the present in terms of money. We do not think sufficiently in terms of goods and services. The very fact that to-day we have on the one hand such vast quantities of goods everywhere, and the possibility of producing so much more, while at the same time we have more poverty, throughout this country than we have had for many years, should be a challenge to every thinking member of this house. We have an army of somewhere around five hundred thousand people unemployed, and we are keeping to-day at the expense of the federal government no less than one million people on relief. These are some of the reasons no doubt why the government
Economic Council

has introduced this legislation and I congratulate them upon doing so. I do feel, however, that if they refuse to accept the amendment now before us simply because it has been proposed by a private member of this house, they are making a great mistake.
May I remind this house that whatever is physically possible is or should be financially possible, and that is one of the problems that the amendment suggests should be considered. The condition in which we find ourselves to-day, with this vast amount of poverty, is largely the secret of many of our other problems. The railway problem, for instance, is largely brought about because of a lack of purchasing power on the part of the people. If -people had purchasing power they would travel a great deal more than they do to-day, and would provide freight and express business for our railways, and we would not have the railway deficits that face us every year. Just about twelve months ago the railways of Canada put on reasonable rates from western Canada to the east, and they had to put on several extra trains to accommodate the people who wanted to come east. The people wanted to travel in any case, and they did travel then because they could travel at much lower rates.
The health problem again can be laid largely at the door of poverty. When people are in poverty they cannot get the necessaries of life, with the result that they are forced to adopt a lower standard of living, and ill health often develops. Crime also can largely be laid at the door of poverty because everybody recognizes that poverty is the mother of crime.


William Irvine: Poverty is the greatest crime of all.


Henry Elvins Spencer: As my hon. friend from Wetaskiwin says, poverty is the greatest crime of all. Again, the lack of trade to-day is not because we cannot produce or consume or because we do not want to consume; it is simply because we have failed to bridge the gap between production and consumption. As the Minister of Railways (Mr. Manion) so well said, it is a problem of distribution to-day, not a problem of production, and it is because too much of our legislation has been directed towards ways and means of producing more, and not of distributing more, that we have failed up to the present time. If we would look after the consumers, instead of taking so much pains with regard to the producers, the producers would certainly be able to look after themselves.

I hope the government will change their mind with regard1 to this amendment. If it is not worded jusit as they would like, I trust they will propose an amended wording so that the amendment of my hon. friend from Wetaskiwin can be accepted. It would be a great mistake indeed for the government to turn it down.


George Halsey Perley: Mr. Chairman,
we certainly have no objection to considering suggestions coming from any part of the house, and my hon. friend from Wetaskiwin (Mr. Irvine) is not giving us sufficient credit when he suggests that we do not pay enough attention to things proposed by a private member. As a matter of fact I consider that the purpose that is sought to be achieved by this amendment is covered by paragraph (a) of clause 6, which is very broad indeed. I have read it over very carefully again, and I think my hon. friend will agree with me that this clause and the others in the bill give ample authority for investigation and report upon any question which the Prime Minister may request the council to look into. In other words, paragraph (a) of clause 6 is quite broad enough to enable the Prime Minister to have an investigation and report upon the particular subject to which my hon. friend refers in his amendment. We prefer not to specify any particular questions which we think ought to be examined into by this council. I say to the hon. member for Wetaskiwin that as far as I am concerned I do not think there will be any doubt that the question referred to in his amendment will be one of the matters in connection with which this council may well be given authority to inquire.
Amendment negatived: yeas, 13; nays, 31.


[Stage Direction]
Section agreed to.
On section 7-Meetings of council.
George Gibson Coote: If this council is to be of
any use to the government this section should be changed. Surely the council should meet more often than twice a year; I think it should meet at least twice a month. In such case the Prime Minister would be aware that he had such a council and would give it certain matters to investigate. If it is to meet only twice a year he might forget that he has a responsibility to charge them to investigate certain matters.
Sir GEORGE PERiLEY:	I do not think
my hon. friend need worry, as this council will meet as often as is desirable or necessary to enable it to carry out its work. Special committees and ad hoc members will

Railway Act-Rates on Grain
be appointed from time to time for different purposes. The council is to consist of seven civil servants and eight persons from outside and it was thought desirable that it should be stated that they must meet at least twice a year. This section is not for the purpose of limiting the number of meetings.
Section agreed to on division.
On section 8-Special statistical investigations.


George Gibson Coote: Could the minister explain
what is meant by "investigations under the Statistics Act"?


George Halsey Perley: The intention
is that this council shall have the benefit of the work of the dominion statistician. These words may be superflous and if the hon. gentleman thinks they should be left out I shall consider the matter.


Edward Joseph Garland: I think they had better stay in because the Statistics Act gives the power to direct an investigation and to undertake the necessary examination.


George Halsey Perley: The council will have the benefit of the assistance of the dominion statistician in accordance with the act under which he works.


[Stage Direction]
Section agreed to.
Sections 9 and 10 agreed to.
On section 11-Annual report.
George Halsey Perley: A suggestion has been made by the hon. member for Bow River (Mr. Garland) that certain words be added after the word "work". I have no objection although I think the point he has in mind is covered by subsection (e) of section 6.


Edward Joseph Garland: Perhaps
the acting Prime Minister is right, but I think it would be advisable to add the words "and findings" after the word "work".


George Halsey Perley: I have no objection.


Edward Joseph Garland: I move that section 11 be amended by inserting the words "and findings" after the word "work" in the second line of the section.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
On section 12-Expenditures.
Cameron Ross McIntosh: When this matter was
being considered last evening I inquired as to the cost of this council. Has the minister
this information which he promised to furnish when the house was in committee of the whole?


George Halsey Perley: I am informed
that the annual cost will be $25,000 or $30,000.


[Stage Direction]
Section agreed to.
Bill reported.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.

[Stage Direction]
Mr. THOMAS REID (New Westminster) moved the second reading of Bill No. 38, to amend the Railway Act (rates on grain).
He said: This is now the fourth time I have introduced this matter into the house by way of a bill. The first year I came here I introduced it by way of a resolution. I have no apologies to offer to the house and to the country for keeping at this matter for four years; indeed, I intend to carry on with the fight as long as I am a member.
Long ago I came to the conclusion that it is within the House of Commons that this matter, the fight that British Columbia has in connection with the equalization of freight rates, should be fought out.
It is not my intention again to go into every phase of the question, because I am of opinion that after some four years perhaps enough has been said regarding the various rates and the rate structure without again taking up the time of the house in connection with them. However I would like to take a few moments to touch briefly on the history of the case as it affects the province of British Columbia.
Shortly, the situation is this: British Columbia at the time of confederation was a crown colony. Portions of railway systems had been constructed in Eastern Canada, but no outlet or access to the Pacific coast by railroad was then in existence. British Columbia at that time had her own customs and excise and was under the British crown a self-governing colony. As an inducement for her to give up those privileges and to join with the other provinces in order to complete this country as a dominion, she consented to do so on the understanding that railway connection would be given her and also that she would be placed on an equality with the other provinces so far as transportation was concerned.
The dominion government then had surveyors map out a route into British Columbia
Railway Act

Rates on Grain
[Stage Direction]
and they se'icted what is known as the Yellow-head pass route. The Canadian Pacific Railway were induced-and I am just stating the facts briefly-to undertake to build that railway into British Columbia. They however put their own surveyors on the work and decided that they would take another route which they declared was some one hundred and forty-two miles shorter, and known as the Kicking Horse pass route. After the railway was constructed, the rates into that province were set and the Canadian Pacific Railway at that time took the stand that as some difficulties had been encountered in regard to the construction of that road, necessitating heavy blasting of rock and so forth, they were entitled to charge higher rates than were being charged in other parts of the dominion. It must be remembered that at that time the Crowsnest pass rates were in existence. The people of British Columbia felt greatly incensed at the attitude of the Canadian Pacific, because they had been given to understand that they would be placed on an equal basis as to rates with the people of the other provinces. It is without prejudice that I say this: The attitude of the Canadian Pacific themselves in those early days largely brought about the construction of a second road into that province. British Columbia in 1909 or 1910 decided that something had to be done to counteract the power of the Canadian Pacific Railway and to give that corporation some competition by way of another railway in an endeavour to bring the rates down. So we had constructed from Edmonton to Vancouver another line which now is comprised within the Canadian National railway system. When the railway was being built, the people of British Columbia were taking care that they would have control of the rates and as matter of fact were considering inserting the rates in the act, but they did not go so far as that. However they saw to it that in the Railway Act passed in the session of 1909-10, the government of British Columbia would control completely the rates of that railway. But what happened? Just after the line was completed, the dominion parliament passed an act to the effect that that railway was for the general good of Canada, and at one fell swoop, shall I say, took away the railroads laid down by British Columbia and placed them under the board of railway commissioners. That very briefly is an outline of the history of the matter. I am not going to take up the time of the house with every little detail because I have many other matters to speak of, and as I said before, many of these facts have been placed on the 
records of previous years. The board of railway commissioners, might I point out, was presumably set up as a safeguard for the people; that is fairly evident I believe, because the railroads themselves required no safeguards as to rates. The railroads could set the rates, but as a safeguard so that the railroads would confine themselves to reasonable rates, a board known as the board of railway commissioners was set up, and I think I am correct when I state that that board was set up with the view principally of protecting the people from both railroads and not the railways from the people.
I am of opinion that the time has now come to review the board of railway commissioners. We have had put through this house an act to bring about compulsory cooperation in both railways. If I may use that term, and there is no doubt that competition in rates to capture traffic has been to a certain extent, if not entirely, eliminated. When one considers that in the neighbourhood of $330,000 annually is paid out to that board, that competition has largely been eliminated, and we are living in the year of our Lord 1935, under changed conditions, I think it would be well for this parliament to consider whether the board of railway commissioners is fulfilling as useful a function as it did when it was first set up.
The three most important factors in connection with the cost of railway service are construction, operation and maintenance. I am not going into the question of finance and all the intricacies of railroad management; I speak simply of the three principal items determining the cost of railway service. I have stated many times, and repeat briefly without going into minute detail, that in British Columbia construction costs were lower than they were in many other parts of eastern and central Canada; and also in that province they have lower operation costs and lower costs of maintenance. I repeat that, because it does annoy one to be told by some people that the railroads there have the mountain grades to overcome. We have, as is well known in British Columbia, the lowest grades in the whole dominion, especially through the Yellowhead pass from Edmonton, over the Canadian National, the maximum grade being seven-tenths of one per cent. I say again that the construction costs, the operation costs, and the maintenance costs of both the Canadian Pacific and the Canadian National in the province of British Columbia are comparable with the low costs

Railway Act-Rates on Grain
on the prairie and much lower than in parts of eastern Canada, especially over the Laurentian range.
British Columbia has paid very dearly for the mistake made by the Canadian Pacific in taking the Kicking Horse pass route. Although the Canadian Pacific received large grants of land and large subsidies as well to meet their contention that they had these difficulties to overcome, rates were set having in view the grades on that line at that time, and those rates have been maintained right up to the present day and have cost the people of British Columbia many millions of dollars more than they ought to have paid. I stated last session and I repeat that British Columbia can never look for any redress from the board of railway commissioners unless greater powers are given that board and drastic changes made as well. I pointed out last year that it was useless to go before that board. In spite of that, however, I was willing to try out the board, and so made an appeal to them asking that feed grains and mill feeds be carried to British Columbia at the same rate for domestic use as for export. Without going too deeply into the matter I may say briefly that the board relied in its judgment almost entirely on past judgments, at least the majority judgment did. The question was raised at the outset of the appeal whether I had any right to be there, inasmuch as the question had been decided some years ago. Right at the start the railway companies objected, saying this was the same appeal, and they asked the board not to listen to it. They said there would be no end to it if this case were again opened up. But the application I had before the board of railway commissioners was not entirely the same as the former one, because I was asking only that feed grains and mill feeds be carried into that province at the same rate as that charged on the same commodities for export.
To show how difficult it is to interpret a statement of the principles that should guide the board I am going to read the order in council, P.C. 886, passed in 1925, from which I ask hon. members if they would not form the opinion that very wide powers were given to the board to equalize rates. It says:
The committee are of the opinion that the policy of equalization of freight rates should' be recognized to the fullest possible extent as being the only means of dealing equitably with all parts of Canada and as being the method best calculated to facilitate the interchange of commodities between the various portions of
the dominion, as well as the encouragement of industry and agriculture and the development of export trade.
The committee are further of the opinion that to give effect to this policy, and considering the submissions made by counsel and important trade organizations representing different provinces and localities in the dominion as to the disadvantages that would be suffered by such provinces or localities by any partial or incomplete consideration of the freight rate structure, a thorough and complete investigation of the whole subject of railway freight rates in the dominion should be carried out by the board of railway commissioners, the body constituted by parliament with full powers under statute to fix and control railway rates.
The committee are further of the opinion that as the production and export of grain and flour forms one of the chief assets of the dominion, and in order to encourage the further development of the great grain growing provinces of the west^ on which development the future of Canada in large measure depends, it is desirable that the maximum cost of the transportation of these products should be determined and known, and therefore are of the opinion that the maximum established for rates on grain and flour, as at present in force under the Crowsnest pass agreement, should not be exceeded.
The ordinary layman reading that would, I think, be inclined to believe that wide instructions were given to the board of railway commissioners to equalize freight rates and for the conduct of that inquiry. That is why I stated at the beginning of my address this evening that if the province of British Columbia is ever to obtain any redress from the board of railway commissioners, drastic changes will have to be made in the Railway Act, and it would have to be stated explicitly. Otherwise, from the experience I have had and the judgments which have been rendered, I am convinced that the board would go through the act with a fine tooth comb to see if they could evade the question so far as the people are concerned. I was told last year, I believe by the Minister of Railways (Mr. Manion), that the House of Commons is not the place to fix railway rates. I quite agree that if one brought into the House of Commons the whole railway rate structure of this dominion there might be some kind of a mix-up. But I say this, and I say it from experience, that parliament could not do worse than what is in existence at the present- time. I ask any hon. member to look at the various rates in existence from one end of this country to the other and then consider whether parliament could have done any worse than the railways and the board of railway commissioners have done. But, Mr. Speaker, we are not asking parliament to fix all freight rates; we are asking parliament to give British Columbia what has been denied
Railway Act-Rates on Grain
[Stage Direction]
that province since 1886, and what was given the other portions of this dominion. We are not asking for anything unfair; we are not asking for lower rates than are given other provinces. We are asking for the same equal treatment that has been accorded the other provinces and surely that is within our rights; surely that is not unfair. We are asking this from, the court of last resort, the highest court in the land, which is the parliament of Canada.
I am going to quote just one or two rates to show what I call the hodge-podge of railway rates in this country. One could devote a whole evening to these rates, but I am going to quote only a few. I want first to show the house the penalty British Columbia has to pay when it ships produce east as compared with other provinces when they ship the same produce west. If British Columbia wants to ship butter to Calgary or Edmonton the rate is $1.49 per hundred pounds, while if Calgary or Edmonton want to ship buitber to Vancouver they pay only $137 per hundred pounds. What is the reason for the difference? Then take eggs: British Columbia produces great quantities of eggs; so does Alberta. But when we ship our eggs to Calgary or Edmonton we are charged $1.13 per hundred pounds while if Calgary or Edmontoni ship eggs to us they pay only $1.10. The same situation exists in regard to fresh beef; the rate from Vancouver to Calgary or Edmonton is $1.13 per hundred pounds while the rate from Calgary or Edmonton to Vancouver is $1.10. Cattle shipped from Vancouver to Calgary or Edmonton pay 57^ cents per hundred poupds while cattle going from Edmonton or Calgary to Vancouver pay 56 cents per hundred pounds. It would be just as reasonable if the railway companies charged their passengers one rate from Calgary or Edmonton to Vancouver and another rate when returning from Vancouver back to Calgary or Edmonton. No railway company and no government would stand for any such differences in passenger fares, but the different freight rates I have quoted have been in existence for many years.
One might go on and show just how much more British Columbia is paying than is being paid by the other provinces, and I would point out that British Columbia should receive greater consideration from the eastern provinces because, as is well known to every hon. member from British Columbia at least, that province buys most of its manufactured articles in the protected east, but it is compelled to sell all its own commodities on a world market. But no consideration has been given that province in connection with the

shipment of such commodities as butter, eggs, fresh beef, cattle and so on. I am not going to raise any question of the east against the west or the west against the east, nor am I criticizing ithe eastern provinces; but I would point out that all the rates in the eastern provinces are far lower than the rates in the west. I will mention just one or two. The eastern carload rate for a two hundred mile haul is 15 cents per hundred pounds; the less than carload rate is 30i cents. In the west those rates are 20 cents and 51 cents, while in the Pacific section they are 23 cents and 59 cents. I have a whole list of such comparisons but I am not going to put them on record because it would take too much time. Looking over that list, however, one must come to the conclusion that the eastern provinces and central Canada certainly enjoy far lower rates than those in force in ithe province of British Columbia. After all, Mr. Speaker, provided that conditions are the same and that maintenance and construction costs are roughly the same, mile for mile should not we in the province of British Columbia have the same rates as apply in other parts of the dominion?
I have heard some criticism in regard to the Crowsnest pass rates, for example. I do not think the government however would assume the responsibility of removing those rates, which were set by statute in 1897 and reaffirmed1 by parliament in 1925 with some changes. It is unfortunate that in 1925, when the change took place, those rates were not extended to British Columbia, but I do not think this Or any other government would care to assume the responsibility of saying the Crowsnest pass rates were too low or unfair. There they are, and I claim that we in British Columbia are just as much entitled to those rates as are the central and eastern provinces. I am of the opinion, Mr. Speaker, that one of the things wrong with our railways is that the passenger system is too costly. I believe a large part of the railway losses in this country occurs in connection with the passenger traffic. The railways were built primarily for freight, but the freight end of the business has not been developed as it should have 'been. I do not believe any hon. member would suggest that passenger rates should be raised; no, the tendency is to lower them in order to induce people to travel. The same principle should apply in connection with freight. To-day the railways are complaining of competition from other methods of transportation. I think they are going to have even more competition of that kind. They are experiencing it now on tile great lakes, and

Railway Act-Rates on Grain
in various parts of the country they are suffering from the competition of the trucks. I predict that if railway rates to British Columbia are not lowered, once the highway is completed from the prairies to British Columbia we will see long lines of trucks hauling wheat and other produce between these points because they can do it for much less than what is charged by the railways. Two years ago they tried moving apples from the Okanagan valley by trucks; last year many carloads of apples were trucked along the highway from Okanagan valley which in past years had been handled by the railways. Why is that being done? It is because the railways refuse to alter or lower their rates. The consuming public are not interested in the intricacies of freight rates; what they want is cheap service and if the motor trucks can offer them a cheap service that is the kind of transportation they are going to patronize.
Coming to the export rate to British Columbia, which is twenty cents per hundred pounds for export, might I point out that while on the surface it would appear that this is comparable to the rate to Fort William, it is really still much higher than that rate. During the hearing of the matter I challenged the railways to prove to the board of railway commissioners that the export rate on grain was a losing rate, I take the stand that the rate of twenty cents is a paying rate, and if that is so, why should the people of British Columbia who want to use wheat have to pay twice the rate charged on other grain that is hauled in the same trains by the same engines over the same tracks and in charge of the same crews? There is no reason for it at all. The railway companies have always dodged the issue when confronted with the statement that the export rate is a paying rate. The hauling of wheat is one of the major traffic items of the railways, and this might interest some hon. members:	During the past few years the
great bulk of Canadian wheat has been going out through Pacific coast outlets. In 1933 over 100,000,000 bushels of wheat went through the Pacific coast outlets while a total of only 83,000,000 bushels went out through all the eastern Canadian ports. I received these figures to-day, and to me they were most interesting. Of the 83,000,000 bushels shipped through the eastern ports over 6,000,000 bushels were from the United States. The exact figure for the Pacific coast ports is 100,587,923 bushels and for the combined eastern ports including grain from the #2582-118
United States, 83,675,534 bushels. I believe these figures will indicate the trend of the grain traffic to-day.
May I point out to hon. members that wheat can be shipped cheaper via Panama than through the eastern ports. I believe the railroads would find it to their advantage to give more encouragement to the use of Pacific coast ports. In my view the system of our freight tolls is antiquated; that statement was made many years ago before we had truck and other competition. The whole system should be revamped by a practical commission with a view to encouraging the service and to the selling of more railway service to the community. The commission should have in mind, too, the possibility of offsetting truck competition, because, as I have pointed out, if the railways do not go out to meet truck competition their revenues will become smaller and smaller as the years go by. Will the railways and the government stand by and watch the competition grow, a competition which in the end will leave very little freight traffic for our railways?
Since 1920 four changes have been made in the export rates to British Columbia. No change has been made in the domestic rates.
Robert James Manion: Except in regard to feed grains.


Mr. REID:: Yes, except in regard to feed grains, but only temporary. Now that the minister has mentioned feed grains I should like to point out something which happened last year and which I believe will serve to indicate the arbitrary attitude taken by the railway companies. Tariff 145 designated certain grades of wheat which would be carried at a rate of 30J cents per 100 pounds. Mill feeds were left out, and they should not have been left out. There is in Cloverdale a cooperative association composed of farmers, an association which buys as cheaply as it can and returns profits to its members. That association bought t,wo carloads of burnt wheat unfit for human consumption. When it was brought to Cloverdale it was distributed among the members of the association, and the numbers 5 and 6 feed rates were charged. About a month later the railway company sent in a bill for $112 per carload indicating that burnt wheat was not under the tariff. It is true that burnt wheat might not have been mentioned under the feed grain tariff, but hon. members will realize that it could be used for no purpose other than that of feeding stock. As a matter of fact it is not very palatable even to poultry, but poultiy-men will buy it because it is a little cheaper. I have mentioned these facts so that the

Railway Act-Rates on Orain

minister may know the attitude of the railway companies, may realize how arbitrary- or shall I use the word unreasonable-they can be at times. Surely they must know that burnt wheat is only feed wheat, and could be used for no other purposes. Whether or not they have changed the rate by this time I am not sure.
On the order paper we have legislation to deal with minimum wages. It is all very well to have a minimum wage rate, so that the workmen will be operating on a better basis, but so long as the province of British Columbia is subjected to these inequalities, in the matter of freight rates, so long as it is being soaked, shall I say, more than the other provinces, the wage changes will not be of very great benefit to that province. What reason can there be for charging a certain rate on a certain article going in one direction and another rate for the same article going in the opposite direction? I know the railway companies can give excuses; they are very good at that. It is marvellous to behold the manner in which they can quibble, as any of us who have had occasion to combat them could testify.
During the hearing of the appeal-and I ask the minister to take special note of this- the commission were asked why the rate was so low from Fort William to the eastern ports, and the reply was that the rate was low because of water competition. The rates for domestic purposes were kept low so 'as to endeavour to capture the trade. However when I asked them how it was that .they had i rate of 25 cents per 100 pounds for domestic purposes as against an export rate of 34J cents irom Fort William to Montreal, they had no answer to make. They had been arguing that the export rate had to be lower so as to induce traffic, and that the domestic rate was considerably higher. Here was an instance however where they had lowered the domestic rate to 25 cents per 100 pounds while the export rate remained at 34i cents. As I pointed out, a man oould very well buy a carload of feed presumably for domestic purposes at 25 cents per 100 pounds, and ship it at the export rate, but if the reverse had been the order, the export rate at 25 cents and the domestic rate at 34J cents, he would not have been allowed to buy the car on the export basis, and use it in the province of British Columbia. No answer was forthcoming in that connection. It is also very interesting to note that the rates were lowered to a considerable degree from Fort William to eastern points due to the fact that the milling companies were beginning to use their own boats. fMr. Reid.]
These interests, which had been encouraged by the railway companies and were given many concessions, were now stepping out, shall I say, to carry their own products on the great lakes. They were the ones who caused the low freight rates which existed on the great lakes last season.
I shall reserve any further observations until other hon. members have spoken. I should like however to repeat this question:	Why
should we in British Columbia be called upon to pay for the heavy losses entailed by the railway companies on steamships, hotels and other investments? I declare the export rate of twenty cents pays. If it does not pay I see no reason why the poeple of British Columbia should be asked to carry the loss. The fact that grain is going through the Pacific ports is to the great advantage of the railways despite the faot that the export rate to Vancouver and New Westminster is a little higher than the rate to the east.	*
This is the fourth time I have introduced this subject. It is not a political matter, but it is one which affects the whole of the province of British Columbia. We are not jealous of the maritime provinces, we wish them the best of luck, but when one notices in the estimates for the present year a vote of almost a million dollars for concessions to the maritime provinces in the matter of freight rates one wonders just how long we in British Columbia will have to cry before we get justice. That is all we are asking. We are not asking for a rate lower than that enjoyed by other provinces; we are not asking for anything unfair; we are asking only for treatment equal to that enjoyed by the eastern and prairie provinces. I would ask the minister, therefore, to take what I have said into serious consideration, and I should be particularly pleased if this year he would allow the second reading to pass and let us go into committee on the bill. I have pointed out repeatedly that it is useless for us in British Columbia to appeal to the board of railway commissioners, and I cannot make that statement too emphatically. That is the actual record. They themselves have quoted case after case, dating from 1917, and they have taken an attitude against any change in past judgments; they have said, "These judgments have been rendered against you, we are very sorry that we can do nothing for you in the matter." So long as these judgments remain and so long as this is the attitude of the board, then I contend that it is useless for us to make any appeal to them. I submit that parliament is the place where the injustice should be righted; it

Railway Act-Rates on Grain
could be righted by this bill and changing the act, and we should then have what the east has enjoyed for many years.
I would ask the minister this question. Why is it that in the Railway Act the words grain and flour cover all grain and grain products, whereas when it comes to shipments to the Pacific coast the railway companies distinguish between export grain and domestic grain? I think the word "grain" should be applicable throughout the dominion. It is our view that this phase of the matter should be looked into.
I am not going to discuss the question of the losses sustained by the railways, nor shall I consider the question whether this is the proper time to make the change. In 1925 the railway companies used the argument then and said that they could not make any change because it would mean a dead loss to them if they did so; they opposed any changes in the export grain rates. Well, the Panama canal and the ports of Vancouver and New Westminster have opened up since. The rates were changed with respect to export in 1925, and what happened? The grain traffic has grown considerably. I submit that if we are looking for markets and for a more equitable adjustment as between different products in the country then one of the first things that should be done is to see that grain products are carried equally mile for mile under similar conditions throughout the dominion. I appeal to the government.


Mr. A. E. MUNN (Vancouver North):: I congratulate my hon. friend from New Westminster (Mr. Reid) on the gallant fight he has put up in connection with the equalization of freight rates in the west, and I support him most heartily. I am not going into the details of this matter; I do not intend to take up much of the time of the house. The hon. member has set forth the arguments and given the details. We know why the rates have not been equalized. I am not prejudiced against any of the railways, but the fact is that in consequence of the mistake made by one of the railways-it is not necessary to be more specific than that-we cannot get an equalization of freight rates to-day. There is a very simple remedy available; there are thousands of railway men in Canada who could tell you what should be done. This afternoon I heard a good deal about a proposed economic council, and the chances are that when the council is established one of the very first things it will submit to this government, or whatever government is in
power, is that the heavy hauls should be over the Yellowhead pass. It seems to me that an arrangement should be made whereby the Canadian Pacific instead of hauling heavy freights up and down the hills, should go through Yellowhead pass, where there is a decent grade. If that were done millions could be saved in transportation in that direction alone. We do not need to go to an economic council for that information; ask any railway man, whether Canadian Pacific or Canadian National, and he will tell you. that.
I cannot understand why not only the members from British Columbia but hon. members on all sides of the house from Alberta to Saskatchewan should not support my hon. friend in the appeal he has made, and I say that for this reason. They have feed grain to sell, and our climatic conditions are favourable to feeding not only poultry but stock. Give us an equalization in freight rates, give us a reduction in the domestic rates, and then the people of Alberta and Saskatchewan will have a market for their feed grain, which they require to-day.
That is all I have to say. I congratulate the hon. member on the fight he has put up, and it is not a political fight. He lives in the Fraser valley where he can see the conditions, and I can appreciate them too although I do not live there. I hope that other hon. members from the west will lay aside their prejudices and assist us, to see whether we cannot obtain a reduction in domestic rates.


Mr. H. J. BARBER (Fraser Valley):: I
do not intend to discuss this question at any great length to-night. It has been a live subject and a very important one in British Columbia for many years. Let me say to the hon. gentleman who has just taken his seat (Mr. Munn) that the members on this side from British Columbia advocated the lowering of the freight rates long before he ever entered this house, and there is not one hon. member from British Columbia to-day who is not in favour of it to-day.


Albert Edward Munn: I have listened to the hon.
member several times and have not heard him advocate it.


Harry James Barber: The hon. gentleman has
not been here long enough.


Albert Edward Munn: I have been here long enough to know that.
Railway Act-Rates on Grain


Harry James Barber: Let the hon. gentleman
read Hansard. This is my tenth year in the house, and I do not believe there is a member from British Columbia who has not supported it during that period. One of the first members from British Columbia to take up this fight on behalf of British Columbia, which was the basis of the contention before the board of railway commissioners, was the ex-Minister of Trade and Commerce (Mr. Stevens). When a special attorney was sent here by the Oliver government of British Columbia to fight the freight rates, that hon. member was the man who handed over his file and all the information he had, together with a promise of assistance on behalf of British Columbia. And we have followed in close cooperation with him. The only objection I have made has been to the method of obtaining the reduction. I would refer my hon. friend opposite to some of the statements made by his friends in 1925, statements by his own leader and by the former Minister of National Revenue (Mr. Euler). If my hon. friends will refer to Hansard they will find that both these hon. gentlemen at that time said that the proper body to deal with freight rates was the board of railway commissioners. The former Minister of National Revenue went further and said that if we could not get justice from the board then it was up to us to change the board. I agree with some of the remarks of the hon. member for New Westminster in regard to the commission. I will not say that they have not dealt fairly with this matter, but I suggest that they are not a sufficiently judicial body, and I believe that many of these questions might better be taken before two or three judges of the exchequer court. If some arrangement could be made whereby, instead of appealing to this body, we could appeal to such judges to decide the case, I think the results would be more satisfactory. The question must be decided. Are we to undertake, in this house, the adjustment of the freight structure of this great country- a tremendous undertaking. I agree that the time has arrived when some adjustments must be made. During the last ten years great changes have taken place in our transportation systems, and I think it would be in the interest of the railway companies as well as the people to have a full inquiry. To carry traffic at a lower rate might get back some of the business the railways have lost to the truck lines.
As I said before, I do not intend to make a speech on this matter. I am sure that there is not a member on this side, either from
(Mr. Munn.l
British Columbia	or	from any	part ofthe west, who is not in favour of the principle of lower freight rates. I had not the privilege of appearing personally before the tribunal which heard	the	appeal	in thismatter, but before leaving for the west I did appear and left with them a written argument asking for the inclusion of mill feeds in the reduction in rates on feed grains. Mill feeds are necessary to the dairymen of the Fraser valley,	as they	must have bran,shorts and chop.	I	can	assure	the hon.
gentleman that for a number of years we have advocated lower freight rates to British Columbia and we still feel that it is necessary in the interests of the stockmen of that province that a reduction should be made. As to whether or not this reduction should be down to that of the export rate, is a question which will have to be decided but at any rate there should be a reduction on mill feeds to equal that given on feed grains. With these few remarks I hope I have cleared up the suggestion made by the last speaker that we, on this side of the house are opposed to a reduction in the domestic rates on grain. We are for a drastic reduction.


Robert James Manion: Mr. Speaker, the hon. member who
introduced this bill (Mr. Reid) stated that he wished to reply, so I should like to know if he intends to allow this bill to go to a vote to-night. If that is his intention I can finish my remarks at one minute to nine o'clock, but if he desires to make a reply, I shall have to go into the question more fully.


Thomas Reid: I said that I would like to
leave the remainder of my remarks until later. I was reserving that part of my statement in case the government turned down the bill. If the government is going to do that then I feel it incumbent upon me to reply to the minister.


Robert James Manion: The hon. gentleman will
have to reply because the government cannot accept this bill. It is obvious to anyone who gives much thought to the matter that the government could not accept this measure. Hon. gentlemen opposite are boasting that they expect to have their party in power after the next election-


An hon. MEMBER:: No question about
that.


Robert James Manion: I think that is a futile
boast. Let me say to them that in supporting a bill of this sort they are laying up trouble for themselves if they should be so fortunate as to come back to power after the

Supply-Trade and Commerce
next election. Any government, whether this one or any other, that attempts to make freight rates in this parliament will be occupied with nothing else but the making of those rates. Members from all sections of Canada will be presenting bills and we will have in this parliament a log rolling contest of the most exceptional kind. Hon. members from Quebec, from certain portions of Ontario, from New Brunswick and British Columbia will be wanting special rates on pulpwood. Hon. members from the prairie provinces will be asking for special rates on their grain products, and hon. members from the hay raising sections of Canada will be asking for special rates on that commodity. It is obvious that parliament cannot undertake to fix freight rates for the Dominion of Canada. In 1904 the board of railway commissioners was set up for the purpose of dealing with freight rates. Whether that board is a perfectly functioning body to-day is another question. Without wishing to reflect upon it in any way, I do not say that it is, but that is a different question. The matter of the reformation of the board of railway commissioners is an altogether different question from that of this parliament deciding to make freight rates. The opportunity to appeal from the ruling of the board has always been open to anyone. At the present time my hon. friend is appealing from a ruling on this question and that appeal will come up in due time before the present government. In spite of the fact that this privilege has been open to all during the years, no government has changed or altered a judgment of the board. At certain times different governments have referred back certain questions to the board and asked that they be reconsidered.
The parliament of Canada has not the proper machinery to deal with this most complicated of questions, so parliament has always taken the attitude that it cannot make freight rates. The hon. gentleman, in what has been a fair speech in a general way, has to-night asked this house, the members of which are not familiar with freight rates, to pass upon the judgment of the board of railway commissioners.



TRADE AND COMMERCE

[Stage Direction]
The house in committee of supply, Mr. MacDonald (Cape Breton) in the chair.
Weights and measures inspection service, including the int#national bureau of weights and measures, $314,396.
Hon. R. B. HANSON (Minister of Trade and Commerce):: When this item was up on
Thursday evening last, the hon. member for Swift Current (Mr. Bothwell) suggested that the item should stand in view of what might be contained in the report of the price spreads commission. As it is apparent that that report will not be down for some time it is felt that the item should not stand any longer. On the same occasion the hon. member for Acadia (Mr. Gardiner) made some reference to car loadings of coal m the prairie provinces, and as a result of his observations and interrogation, a statement has been prepared by the weights and measures branch with regard to that particular matter. This statement ;I desire to present to the committee.
In the matter of discrepancies in the weight of coal shipped in cargo lots from the Alberta mines, it is suggested that this is essentially ft railway matter and will be taken up with the railway commission. As a matter of fact this trouble has been ghen a good deal of attention by the weights and measures service. As a result of complaints in 1924, the weights and measures inspectors in Calgary and Edmonton were instructed to arrange with the railway officials to check-weigh a number of empty freight cars in the coal service, and from this check it was shown that the root of the trouble lay in the inaccuracy of stencilled tare weights, caused by repairing and strengthening cars, by refuse, including coal dust left in the cars, and by rain, snow and ice. The results of these tare weighings were sent to the railway commission in 1925 and 1926 for their information and action, and these checks were made arnually for a number of years as the only thing the weights and measures branch could do to try to improve the situation. The work proved effective, for in March, 1930, out of sixty-one cars checked at Edmonton and Drumheller, all but two cars showed errors of only three hundred pounds and less, which the railways consider correct, and since then the department has not received a single complaint.
The officers also check-weighed a number of loaded cars and asked consignee to return unloading weights, and on eight shipments only relatively small errors were reported, only two being over five hundred pounds. In two cases there were errors of 1,250 pounds and 5,330 pounds on two 30-ton cars, and this error was definitely traced to inaccuracy on the part of consignee in unloading in small lots, a factor that should not be overlooked and one which would not be corrected by net loading. This demonstrated that if reasonable care were taken, freight car loading and weighing would give reasonably
Supply-Trade

Mail Subsidies

accurate results, and it would seem to be a matter for the railway commission to order the railways to exercise such care, since the railways are under their exclusive jurisdiction. If then such reasonable care were enforced, there would seem to be no need for net loading, as to do so would involve heavy expense to the mines in installing costly scales and elevating machinery for net loading purposes.
The inspectors at Edmonton and Calgary are again being instructed to arrange with the railways to make another check-weighing of empty cars at the Edmonton and Drumiheller mines, and as soon as these results are obtained, the matter will again be taken up with the railway commission. The railway scales are not in question. They are inspected yearly by the weights and measures inspectors by means of a 60,000-pound test car.


George Gibson Coote: It was very difficult to hear everything that the minister said. Might I ask him how often these cars are weighed so as to obtain their tare weights? That is not done every time a car is loaded, is it?


Richard Burpee Hanson: The weighing of the cars is under the authority of the railway commission. I understand that under their orders this is supposed to be done every two years, but the scales on which the department tests the weights of the cars are inspected every year.


[Stage Direction]
Item agreed to.
MAIL SUBSIDIES AND STEAMSHIP SUBVENTIONS Atlantic Ocean
Canada and the United Kingdom, on the Atlantic, service between, $500,000.
Canada and South Africa, service between, $112,500.
Pacific Ocean
British Columbia and Australia and/or China, service between, $118,800.
British Columbia and South Africa, service between, $84,000.
Canada, China and Japan, service between, $690,000.	.
Canada and New Zealand, on the Pacific, service between, $200,000.
Prince Rupert, B.C., and Queen Charlotte islands, service between, $12,000.
Vancouver and the British West Indies, service between, $36,000.
Vancouver and northern ports of British Columbia, service between, $18,000.
Victoria, Vancouver, way ports and Skagway, service between, $12,000.
Victoria and west coast Vancouver island, service between, $10,000.

Local Services
Baddeck and Iona, service between, $8,000.
Charlottetown and' Pictou, service between, $25,000.
Charlottetown, Victoria and Holliday's wharf, service between, $4,600.
Grand Manan and the mainland, service between, $33,000.
Halifax and bay St. Lawrence, service between, $2,000.
Halifax, Canso and Guysboro, service between, $6,750.
Halifax and Sherbrooke, service between, $900.
Halifax, LaHave and LaHave river ports, service between, $2,000.
Halifax, South Cape Breton and Bras d'Or lake ports, service between, $3,500.
Halifax, Spry Bay and Cape Breton ports, service between, $4,000.
Halifax and west coast of Cape Breton, service (between, $4,000.
Ile-aux-Coudres and Les Eboulements, service between, $1,100.
Mulgrave, Arichat and Canso, service between, $33,750.
Mulgrave and Guysboro, calling at intermediate ports, service between, $9,500.
Murray Bay and north shore, winter service between, $40,000.	.
Parrsboro, Kingsport and Wolfville, service between, $2,000.
Pelee Island' and mainland, service between, $8,260.	.
Pictou, Mulgrave and Cheticamp, service between, $11,000.
Pictou, Souris and the Magdalen islands, service between, $37,500.
Quebec, Natashquan and Harrington, service between, $76,500.	_
Quebec, or Montreal and Gaspe, calling at way ports, service between, $60,000.
Rimouski and Matane and points on the north shore of the St. Lawrence, service between, $50,000.
Riviere-du-Loup and Tadoussac, and other north shore ports, service between, $12,000.
St. Catherine's bay and Tadoussac, service between, $2,558.26.
St. John, Bear River, Annapolis and Granville, and other way ports, service between, $2,000.
St. John and Bridgetown, service between,
[Stage Direction]
St. John and Margaretville, and other ports on the Bay of Fundy, service between, $2,800.
St. John and Minas basin ports, service between, $3,500.
St. John and St. Andrews, calling at way ports, service between, $3,000.
St. John, Westport and Yarmouth and other way ports, service between, $13,000.
St. John and Weymouth, service between,
$1,000. . _
Summerville, Burlington and Windsor, N.S., service between, $750.
Sydney and bay St. Lawrence, calling at way ports, service between, $18,000.
Sydney and Bras d'Or lake ports and west coast of Cape Breton and Prince Edward Island, service between, $20,000.
Sydney and Whycoeomagh^ service between,
[Stage Direction]
Inspection and subsidized steamship services. $4,000.

Supply-Trade-Mail Subsidies
Joseph Philippe Baby Casgrain: May I ask the minister for some explanation with reference to the item of 81,100 for the service between Ile-aux-Coudres and Les Bboulements?


Richard Burpee Hanson: What particular information would the hon. gentleman like to have?


Joseph Philippe Baby Casgrain: I would like to know whether there is a contract at present in force for this ferry boat service.


Richard Burpee Hanson: There is a contract dated June 25, 1934, and the duration of it is until June 30, 1939. This is a joint contract between the Department of Trade and Commerce, the Post Office Department, and Alphonse DeGagne.


Joseph Philippe Baby Casgrain: Was the contract awarded in 1934 in the month of May? If my recollection is correct, last year no amount of money was voted for a subsidy for that ferry boat service, because the predecessor of the present Minister of Trade and Commerce had refused to grant a subsidy for it. I wonder how it is that the contract was started in the month of May if no subsidy had been provided.


Richard Burpee Hanson: I am instructed that no service was performed in 1932 and 1933, but in 1934 tenders were called for and Alphonse DeGagne was the successful tenderer. An order in council was passed on May 13, 1934, awarding the contract to him. Tenders were called for on March 26, receivable up to April 30. Six tenders were received. There was an amount of $786 in last year's vote.


Joseph Philippe Baby Casgrain: So last year this man received only $786. Does this vote cover only part of this contract? Will he receive something else from the Post Office Department?


Richard Burpee Hanson: This $1,100 is all he will receive from this department. The balance I presume will be received from the Post Office Department,


Thomas Reid: Could the minister tell us if these large items for the Pacific coast are for mail, or are they for mails and subsidies for lumber?


Richard Burpee Hanson: They are not all for mail; some of these ships carry mail and some do not. The first one, British Columbia and Australia and/or China, is a lumber subsidy. Mail is not carried.


Thomas Reid: Would it take long to go down the list? I am interested, as I have a bill before the committee.


Richard Burpee Hanson: British
Columbia and Australia and/or China is a freight service. British Columbia and South Africa is a subsidized freight service. The Canada, China and Japan service is of course the Canadian Pacific mail service. Canada and New Zealand is a mail service. Prince Rupert and Queen Charlotte islands is a general service with mail.


Mr. HANSON (Skeena):: What companies handle that?


Richard Burpee Hanson: The Prince Rupert and Queen Charlotte islands service is handled I believe by the Canadian National.


Mr. ELLIOTT:: I am not anxious to hold up a number of items, but there is an item relating to steamship subsidies that I am greatly concerned about in connection with some advances made to the Richelieu Corporation in 1933. I do not think this is just the time to discuss the matter, as there is litigation pending which is likely to terminate in the course of the next two weeks. One of the members who is very much interested is not here, and I would appreciate it if the minister could see his way clear to give us an opportunity to discuss the matter at a later day-I suggest after the criminal trial is finished, which, as I say, I expect will be within the next two weeks.


Richard Burpee Hanson: I quite
appreciate what the hon. gentleman has in mind, and I am very desirous of accommodating myself to his wishes. I do not know that the criminal trial would have any bearing on any debate or statement here, although possibly I am not fully advised on that point. But there are some supplementary estimates to come; could we not proceed with this item with the understanding that the question which my hon. friend desires to discuss could ibe taken up on the supplementary estimates? As a matter of fact there is no item in this whole list of steamship subventions that is really pertinent to the subject matter which my hon. friend has in view; there used to be one which would have been appropriate. But I should think there would be ample opportunity to discuss the matter under the supplementary estimates or even under the relief act.


John Campbell Elliott: All I am concerned about is that an opportunity be given when my hon. friend is here-and he is here most of the time-to discuss this matter. I hold no brief for the people who are accused, but as they have a trial pending within ten days or two weeks and as they come from another province than that in which they are being tried.
Supply-Trade-Mail Subsidies

perhaps a discussion now would not be well timed. As long as the minister makes the statement, which is perfectly acceptable, that we shall have an opportunity of discussing it at a reasonable time-


William Duff: Carried.
Mr. ELL/IOTT: You wait. As far as the supplementary estimates are concerned my hon. friend knows how they go through, sometimes at the last moment. I would not want it deferred until the very last, but if the minister could see his way clear to give us an opportunity under the relief program that would be satisfactory.


Richard Burpee Hanson: The hon. member's position is I think quite clear, and I will give an undertaking now. There is one supplementary estimate for the current fiscal year under which I will undertake that he shall have an opportunity to discuss the matter which he has in view; or I will arrange that he may discuss it under the relief act- one or the other of those two items. Meantime I should like to make progress with this large item.


John Campbell Elliott: That arrangement will be quite satisfactory. I am greatly obliged to the minister for that assurance.


Olof Hanson: In connection with the China and Japan service, I understand that representations have been made from the timbermen's association and also from the associated boards of trade that when this subsidy is granted for this year it be stipulated that certain boats shall call at Prince Rupert on their way to the orient.


Richard Burpee Hanson: I am glad to be able to tell the hon. gentleman that arrangements are being made for eight calls per annum at Prince Rupert on the outward voyages if reasonable cargo offers, and if reasonable cargo offers I have no doubt arrangements can be made for a call inward.


[Stage Direction]
Item agreed to.

[Stage Direction]
Civil Government-
Salaries, $402,692; contingencies, $45,948.
Some hon. MEMBERS:: Carried.


James Shaver Woodsworth: Before the item is carried may I ask the minister to give an answer to some questions which I proposed when his estimates were last under consideration? I suggested then that we might very well have some outline of the policy of the department. I think almost every other department has a certain well defined policy.

The minister has no doubt had an opportunity of reading the questions which I then asked. They were not asked in order to embarrass the department, but I think we have a right to some knowledge as to the general policy of this country in matters of defence.


Hon. GROTE STIRLING (Minister of National Defence):: The policy of the government with regard to the Department of National Defence is identical, so far as I know, with the policies adopted by governments in the past. There should be a department to take charge of the defence of the country. There should be a force, represented by the three branches of the service, capable of undertaking the defence of the country should the country's boundaries be in jeopardy. That force is divided into the naval service, the militia service and the air service and it is composed of the permanent and non-permanent forces. The permanent force is a small, highly trained, extremely efficient body of officers and men which in times of peace largely acts as a training force for the non-permanent active militia. The non-permanent active militia is composed of the various branches of the militia service, the air service and the naval service, and it is an entirely voluntary body of men whose payment by the country is simply that payment which reaches them for the period of training each year. They go out for their training and the recompense which they receive is but small. The expenses, therefore, to which those non-permanent units are put are very largely paid by the officers of those units, to whom in my opinion the country owes a considerable debt of gratitude. They give their time, their interest and their service, and we have but to look back to the outbreak of war in 1914 to see the test to which the defence forces of Canada were put. The plans which had been made, somewhat modified year by year, were put into operation and these skeleton forces were rapidly expanded into such bodies of men as were capable of joining the contingents of other parts of the empire in the war into which unfortunately we were cast, for the protection and security of the country.
I do not know that in any way the Department of National Defence has changed what has been the policy of the department in this country for many years past. It has to see to it that the forces at its disposal are kept up to the mark; that at .least an attempt is made to keep abreast of modern developments in the conduct of punitive expeditions, and it has to maintain a service of efficiency

Supply-National Defence
which will stand the test when the testing time comes. In addition it fulfils another duty, that the force should be distributed throughout Canada in the military districts in such a way that if called upon by the provincial governments in times of stress and strain, through civil disturbances within their own boundaries, they can render such assistance as may be necessary to support the police forces of the country. The Department of National Defence, therefore, is retained and upheld for these twTo main purposes.


James Shaver Woodsworth: Is there any close, steady cooperation between the Department of National Defence and the Department of External Affairs?


Grote Stirling: There is that cooperation which exists between and throughout all the departments of government.


James Shaver Woodsworth: The minister suggested that prior to the last war there were certain general plans in existence. Is there any definite plan with regard to any future war that might break out? Is there a plan ready for the defence of Canada in such an event?


Grote Stirling: There are the necessary
plans under which the forces would be called upon to operate in the event of trouble breaking out. Those plans of course cannot be described in public. They exist; they are relied upon, and they are modified as events take place.


James Shaver Woodsworth: In the event of
a European war is it the present plan of the department that our forces could be mobilized and thrown into the war zone in Europe? Is that in contemplation at the present time?


Grote Stirling: No, Mr. Chairman; I
should not say that is in contemplation. Certain forces of Canada were drawn into a European embroglio some eighteen or nineteen years ago. The plans were sufficient for that at that time, and we must assume that the plans would be sufficient for Canada to undertake whatever share the government and the people decided she should take if the occasion arose.


James Shaver Woodsworth: Does any representative of the Department of National Defence sit on the imperial council in London?


Grote Stirling: No.


James Shaver Woodsworth: Is there any sort
of arrangement with regard to what might
take place in connection with the air force in the event of hostilities breaking out in Europe?


Grote Stirling: No, not in the sense that I gather the hon. member has in mind. There is an exchange of officers, two in number, between the imperial army and the Canadian militia forces; there are two of our officers in England and two imperial officers in Canada. They might be called liaison officers, and in addition there are a certain number of Canadian officers of each branch of the service, I believe, continually undertaking courses in England, but there is no definite Canadian representative on any defence council of the empire.


James Shaver Woodsworth: Then there is no
definite arrangement under which the Canadian air force would become a unit of the imperial air force?


Grote Stirling: No.


James Shaver Woodsworth: Does the minister
think that in the event of war in the Pacific Canada alone would be able to defend the Pacific coast from anyone who might invade Canada or bombard our ports?


Grote Stirling: That is rather a large
question, Mr. Chairman, to which I do not know that I am capable of giving a definite answer. In the last war the Pacific coast was not attacked. I do not know that I am in a position to say, or that the hon. gentleman could give an opinion, as to whether Canada's defence forces would have been adequate for the purpose if that coast had been attacked.


James Shaver Woodsworth: I am not speaking of the last war; I am speaking of any future war. I take it that the task of the Minister of National Defence, so long as we have a department of national defence, is to make adequate military provision against attack. I ask him, as the responsible head of that department, whether he considers that our forces on the Pacific are sufficient, unaided, to defend the west coast of Canada from any attack.


Grote Stirling: I think that would depend entirely upon the strength of the attack.


James Shaver Woodsworth: Well, that is quite obvious; I would scarcely need to be told that. I do say however that we have an exposed coast in the west. According to the minister we are spending a large sum of money in the hope that through military means we may be able to defend ourselves. Some of us are not ve-ry enthusiastic about that method, and we are not at all sure thal
Supply-National Defence

it is the best means of maintaining ourselves in a state of peace. However I take it that the fact we have a department of national defence and are spending about $15,000,000 on it presumes that as a country we are confident that we are adopting the proper way in which to defend ourselves. Does the minister contemplate that the forces at his disposal will be sufficient to defend Canada in the event of any material attack on the west coast?


Mr. VALLANCE:: Obviously no.


Grote Stirling: The force which would undertake the defence of the Pacific coast would be distributed in such a way as to do its very best to effect that end. The extent of the defence which could be undertaken of that or any other part of the country is closely connected with the amount in dollars voted by this committee for the Department of National Defence.


James Shaver Woodsworth: For the moment I am confining my observations to the matter of national defence, and I am assuming that we are not spending these moneys for any nonsensical reasons. We have an extensive coast line in the west, and two little vessels to defend it.


Ernest Lapointe: That is enough.


James Shaver Woodsworth: Someone says that is enough. In the judgment of the minister is the force sufficient to enable us to defend ourselves in the event of a serious attack on the west coast? I believe my question is a reasonable one.


Grote Stirling: I do not 'believe I could add anything to what I have already stated. The forces at our disposal on the west coast would do the best they could, and the success or failure of their efforts would depend on the strength of the attack made against them.


James Shaver Woodsworth: What is the size of the force?


Mr. MERCIER (St. Henri):: Two by four.


James Shaver Woodsworth: I refer to the naval forces available.


Grote Stirling: Two destroyers and one mine sweeper.
Mr. WOODSWOiRTH: What is the air force available?


Grote Stirling: I wonder if the hon. member would be content if we discussed the air force when we reached the vote for aviation.


James Shaver Woodsworth: Very well. Following up my earlier questions may I say that my thought is this: If I am at all right it is surely obvious that with our very small naval force, supplemented by the air force available, Canada would find it quite impossible to defend herself against any serious attack along the west coast. That being so, may I ask whether there are any definite plans by which the British navy or the American navy would come to our defence?


Grote Stirling: Not that I am aware of.


Mr. ROSS:: I am pleased to hear the discussion which has taken place on this item. The remarks I should like to make may have some bearing on following items in the estimates, but perhaps it would be convenient to complete my observations at this time. During the last few days I believe that as citizens we have been compelled to give more serious consideration than has been given in the last twelve or fifteen years to the estimates of the Department of National Defence. Hon. members should consider these votes and ask themselves what we have reserved for the $9,000,000 or $12,000,000 or such sums as have been voted in the years following the close of the last war. The vote has increased from $8,000,000 to $10,000,000, $11,000,000 and so on. II believe it is quite in order that hon. members should ask what we are getting for these large sums of money, and whether we are getting what we should have at the present time.
Some time ago I spoke about the nature and the extent of the next war. The result has been that there has been an increase in the estimates along the lines I suggested. We note an increase in the estimates for the air force, amounting to about $700,000. Undoubtedly history has shown that we have always been preparing for the past war, not for the future war. Following the continental wars and the wars of the American independence we put all our time and consideration upon improving the infantry. Following the South African war we directed our energies to an improvement of the cavalry and the mounted infantry. Since the close of the great war it may be that we have been going a little too far in the development of artillery. In other words we are constantly prepai-ing for the war that is past, not for the war that is likely to come.
If I had my way there would be no more wars. I have had as much experience in war as any hon. member of the house. Possibly more. The old British army without a doubt has outlived its day and has gone. What a

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splendid history it had! Beginning under adverse opinion it worked its way into the_ affections of the people, the parliament and even its enemies. When the army of Marlborough returned from its great wars and victories the imen were treated as plagues. In England they were looked upon as pests, despite the fact that they had only recently returned from their glorious victories. Following 1763, when through the acquisition of colonies Great Britain became an empire, the suggestion was made that theTe be a standing army to be used to garrison the outposts of the empire. The people in parliament treated that army as another plague, and the cry of ""down with the standing army" was raised. Mercenaries had to be hired to do the work, and the service given was altogether unsatisfactory. Again in 1815 the British army returned home after its glorious victories, having saved the empire and perhaps the whole of civilization. Again they were treated as plagues and pests. After 1815, however, the empire was greatly enlarged by acquisitions of considerable extent, and accordingly a force had to be raised and maintained. What treatment did it receive? Instead of being retained at home practically the whole army was banished to foreign service and had to undergo great misery and suffering. In Australia it lived in a state of wretchedness. In Cape Colony, now Cape Province, it was almost abandoned; in the tropical countries yellow fever almost wiped them out, eighty per cent of the force vanishing each year. In the West Indies, where we are told there is a delightful climate, the army lost forty per cent of its number. In Minorca the army was sent without bedding and meat was omitted from the ration. In Burma in 182426 it marched through the jungles without vegetables, milk or meat and only one out of seven of that army returned. I am giving this historical illustration to show what the army has gone through and what splendid service it has rendered to the empire. Here was an army in terrible condition, passing through cruel suffering in the Crimea, and for the first time the British public began to realize its responsibilities. For the first time [DOT] the people of Great Britain began to see that they were responsible for that army and for the conditions under which they served, and for the first time British soldiers returned from victory to be decently treated by the British people and the British parliament. The army has had a wonderful history, and I bring this up because I want the house to realize how much the
empire has owed to the army in the past, what splendid service it has given and what a record it has -made for the British people. British soldiers entered a country on every occasion as an enemy, and invariably oame out friends of the people into whose country they went. In South Africa the British army marched through the whole field without one complaint from the citizens of misbehaviour. The Peninsular army marched from the Pyrenees up to the channel and returned home without a complaint from a single citizen.
This is the army we have been proud of, but its day is gone. It has left a great responsibility, however, upon the people of the British empire, upon the people of Canada, that of seeing that similar conditions do not prevail in the future. If another war should come, which God forbid, let us see to it that those who go first shall not be left in the position of those who went first in former wars. One hundred thousand were completely wiped out for lack of preparedness; one hundred thousand lives were practically sacrificed in order to afford time to make preparations so as to meet the enemy. Consider what we are doing. What I am about to say is not intended as criticism, though perhaps we have been indifferent. The old army is gone. We have remnants of it going around yet; we have an infantry parading with rifles, which are as obsolete to-day as the bow and arrow when you remember that there are machine guns. We have the Royal Canadian Horse Artillery in Kingston without horses; and yet they include swords and spurs in their equipment. If you want to realize what is really important so far as service goes I would ask you to read a part of the report of the Department of National Defence. Let us read that report and ask ourselves whether we are satisfied with the conditions which that report discloses. There is no question whatever that the air will be of greatest importance in future preparations. I would refer the committee to page 76 of the report for this year, though there may be some changes, and I would ask the minister whether in his opinion an increase of $700,000 is sufficient for preparations. At page 76 we have the different types of machines set out:
Siskin.-Single seater fighters of a type which has been withdrawn from service in the Royal Air Force as obsolete. The last Siskin was purchased in January, 1931.
Atlas.-An army cooperation type now being withdrawn from service in the Royal Air Force. Although not up to date, this type is satisfactory for army cooperation training. The last Atlas was purchased in December, 1928.
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Vancouvers.-These aircraft were originally purchased and used for civil government work but have now been modified for service purposes.
Training types:
Fleets.-A two seater training type suitable for ab initio training.
Moth 60.-A light two seater training type now obsolescent.
Avro 621.-A two seater training type which has been adapted for army cooperation training.
Courier.-An obsolete type but retained in service for air firing practice.
Tomtit.

A two seater type used for practice purposes.
Other types are mentioned, such as Fairchilds, Bellancas, Fords and so on, and there is this footnote:
These aircraft are rapidly becoming obsolete, although a number are still suitable for civil government operations. A few are suitable for training purposes.
If the minister says that he is satisfied with what this report discloses then I do not think that this house should be satisfied. If we are to have an air force, and it is one of the three I consider necessary, then it should be properly equipped, and it is the duty of the members of this house and of the citizens of this country to see that the force is properly equipped. No doubt the minister will discuss this matter, and I am sure he will agree with me that the present state of affairs is not satisfactory. I want him to tell me whether he really thinks that an increase of $700,000 is adequate. Every member of this house and every citizen in the country, I have not the slightest doubt, will advise him to get after the air force and introduce modern types-that is, if we are to have a defence force as more than something to play with, if it is at all necessary, and if this vote of $9,000,000 is not to be lightly passed over without proper consideration. It may be, with these dark and threatening clouds overhead, that we may change our whole equipment and our whole policy, and on this point I will speak later.
Leaving the air force for the present, let us see what the situation is so far as the sea is concerned. Again we have nothing but the splendid recollection of the wonderful British fleet. How these names have stirred us from boyhood up, the names of great sailors who have made the British empire what it is. But the battleships of the earlier days are gone; their usefulness has ceased. Speeds of twenty and twenty-one knots an hom- are no longer adequate; to-day they are building the nine and ten thousand ton cruiser with a speed of thirty and thirty-one knots. But after all, is that the important part of the defence

force? I am sure that the hon. gentleman is sincere, but just think of the great Pacific coast absolutely without any defence. We have two or three little cruisers there, and as soon as any trouble arises you will have to bring them in behind a rock or under cover somewhere. If trouble arose between any other two nations this country would suffer. What is practical sea defence to-day? It is no longer battleships or cruisers, it is the submarine. The history of the last war shows the important part played by submarines. I hope the committee will grant me a few moments to give a picture of what happened during the last war.
In August, 1914, we lost 40,200 tons of shipping through the action of submarines. In July, 1917, we lost 364,000 tons by this means. During the period of the war 6,692,000 tons of British shipping were sent to the bottom and at the beginning of the war we had only 20,000,000 tons. We were finally losing more ships than it was possible to replace under any policy of shipbuilding. If we are going to have naval defence, the only defence I can see will be of any use to us is that furnished by submarines. The cost of this type of defence is very small when compared with the cost of training infantry, cavalry and so on. Lloyd's estimate that during the war we lost 5,861 vessels with a tonnage of something like 13,233,172, a figure greater than the one I have given.
I do not wish to detain the committee, but there is a point or two I should like to bring to its attention. If we are to have defence, I think we should spend the money on something which will be up to date and let the rest go. I should like to make two or three proposals. I suggest that the future policy of defence should not be left in the hands of the three or four permanent officers who compose the council. No one knows whether they ever meet and no one knows what propositions are considered. I think this council should include some public representation. The future war will not be a matter of bullets and powder, it will be a matter of industrial activity.


Paul Mercier: Chemistry.


Arthur Edward Ross: That is industry. We have heard a lot about councils to-day, but I think the one spoken of this afternoon is going to work out. I believe civilian representation on the defence council would be of great assistance.
There is another objectionable matter in connection with the permanent forces. These forces are made up of a number of young men and in my opinion they should be en-

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eouraged to make permanent homes. Yet when they want to get married they are told that they must wait their turn. A man may have to wait about fifteen years in order to get a place. I say to this council that they should cut out the swords and the spurs, eliminate these antiquities and let the men of the permanent forces marry when they will and give them an extra allowance when they do marry. If this is done I think we will have a better force, as the men will appreciate this.
Men have been permitted to rise in the permanent forces step by step and retire when they have reached the limit of superannuation or pension to enter into competition with other people in civil government appointments. There are men with thousands of dollars of pension occupying civil government positions paying salaries of eight, nine or ten thousand dollars. The same thing happens with great war pensions. Men are receiving pensions of $180 a month and occupying other government positions. This thing should be evened up. When a man has a substantial pension I think he should be satisfied and not try to occupy another position.
I should like to refer to another matter in connection with the forces in the north. These men are out of contact with their families. A short time ago a young man from my constituency who was in the signal corps alone on Camsell river disappeared, it being supposed that he was drowned. He had a life insurance policy amounting to $2,000, by which $1,000 was left to his mother and $1,000 to his father. In addition he had about $200 in the bank. It has taken every cent of the money he had in the bank as well as some of the insurance money to get his estate settled up. The department insisted that the insurance policies should be sent up north in order that his estate might be settled. I am mentioning this simply as something which may concern other boys who are in the north in the flying or signal corps. This boy was an only son and the parents have been put to considerable expense in having his estate settled. I hope the minister will see that in future cases the department will be fair.


James Shaver Woodsworth: Mr. Chairman, (I
should like to go back to the point I was discussing just before the hon. member for Kingston Oity (Mr. Ross) rose. I quite agree with the hon. member that spurs, swords and that sort of thing are obsolete, and that undoubtedly from the standpoint of defence the air forces are the ones that will be used most in any coming war. But
it seems to me that war itself is or ought to be obsolete; that arms have been shown to be no real defence and that we are to-day simply playing with this whole business. I am not so much concerned about the expenditure of the $15,000,000, although that is a large amount and it might very well be used to much better advantage, but I believe this expenditure of $15,000,000 not only is very largely a waste of money but so far as other nations are concerned, tends to be provocative and at the same time to lull us into a sense of false security. We have undoubtedly come to a position in the history of the world when no one nation can stand alone and hope to defend itself against all comers; yet that is practically the position which the Minister of National Defence is taking, that in a vague sort of way we have to have the army, the navy and the air forces to be able to defend ourselves effectively. That is an altogether fallacious way of looking at the matter; it belongs to an earlier age and not to the situation in which we find ourselves to-day.
We have had references again and again to the strength of the British navy. That may have been all very well in the old days, but I would point out that that strength is not what it once was. At one time Great Britain thought she ought to be able to have a naval strength equal to that of any other two countries. Those claims have had to be surrendered. More recently she thought she ought to be equal in naval power to the United States, to any one other naval power. Those claims too can hardly be maintained. It is only within the last few months that the old idea of the ratio of five, five, three, as between England, the United States and Japan, has been challenged, and with the disarmament conference practically dissolved, we do not know what may happen in the future.
I spoke a few minutes ago about the Pacific. Anyone who knows anything at all about the strength of the Japanese navy must recognize that if anything happened in the orient-and the Japanese may easily break out at any time-our western coast would be exposed to one of the greatest navies of the world, and I do not think anyone can say that Canada alone would be equal to defending herself. Then it is not at all clear that in such a contingency we could rely upon the British navy. That is why I ask whether any arrangements are being made by which we could have cooperation with the United States navy; for I would point out, as is recognized even by many of the British authorities to-day, that
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Canada's interests on the North American continent are essentially different from those of Great 'Britain, and as one of the Pacific powers we shall have to deal with the situation on the Pacific. I think we have a very considerable advantage in being a neighbour to a great nation, the United States; yet I would be one of the last to suggest that we should come to depend upon them and be gradually absorbed into the great United States republic. But let us look at the situation: if trouble broke out between Japan and either the United States or Canada, these two nations would be drawn in together; that is a real situation to-day.
There was a day when we felt we were simply colonials and could more or less depend upon Great Britain and would have to follow her lead. With all due respect to the United Kingdom, I think most of the people of this country think of Canada, as an independent nation within the boundaries of the commonwealth of British nations, but do we propose simply to follow the British lead? We have really no voice in the determination of the war or peace policies of Great Britain. She may become involved in Africa, India, the far east, and then without our having had any participation in the perliminary arrangements, we may be asked to assist. Canada did assist in a military way back in 1014, but personally I am of opinion that it would not be so easy now as it was in 1914 to rally the Canadian people to send troops to Europe, and that not through any disloyalty to the British empire, but because a new idea has come to our people as it has to a great many of the peoples of the world. I would say this, that one of these days unless we throw ourselves into some sort of imperial conference in which we shall have a real participation and can have a real voice-and this few would advocate-we shall be faced with a situation where we may be called upon once again to back Great Britain and we may refuse to do so. Great Britain will, without our having had any participation, present us with a fait accompli. Then what? Can we depend upon the sentiment of the Canadian people? Personally I do not think so, and under such circumstances it would be only fair for us now to say frankly to Great Britain: We do not propose at any time to throw ourselves into a European war. I believe that would be the sentiment of two-thirds of the Canadian people to-day. Surely it would be fairer for us to intimate that to Great Britain at this time than to wait until she is in a tight pinch and then fall back and refuse to give her help. Those are con-

siderations that should be fairly laid before our people and definitely decided upon.
When the great- war was over, I take it that the vast number of people had come to the conclusion that war was a failure; that war settled nothing Whatever. War was waged against Germany, war has given us in place of the kaiser, a Hitler, and in place of the bureaucracy the Nazis-no very great improvement. War did not settle the affairs of Europe; European affairs are in as great a turmoil to-day as they were prior to the w'ar of 1914. There are imminent dangers both on the continent of Europe and in the far east. War has settled nothing. The warring nations after the armistice got together and decided that they would try to secure peace through some other means than armaments. Then came the treaty of Versailles and the setting up of the League of Nations. Well, the last few days have I presume disillusioned a great many people with regard to the security to be obtained through the League of Nations. We have seen the German nation through Hitler absolutely repudiate the Versailles treaty, and of course we are all indignant over that. But let me point out that Germany is correct in her contention that she was not the first to repudiate the Versailles treaty, that the allies failed to live up to their obligations under it. When Germany laid down her arms, she laid them down on the express condition that the other nations would proceed to disarm. That the allies have not done. We might as well frankly face this situation. Hitler may be as bad as most of us think him, but at the same time we must admit that the development of feeling that has taken place in Germany in the last few years is quite understandable on account of the treatment we have accorded her. I do not want to go into that question in any great detail, but lest anyone should think I am expressing merely a . personal opinion, I picked up from my file an article written by Lloyd George and appearing in our papers of 'September 10, 1932. In this article he has this to say:
There were four men primarily responsible for framing the treaty of Versailles, which terminated the greatest war in human history. M. Clemenceau, President Wilson, Signor Orlando and myself.
It not only recast national boundaries in two continents, but it sought to inaugurate a new reign of peaceful adjustment in international disputes by substituting machinery of justice for mechanism of force.
That was the purpose, an effort to substitute the machinery of justice for the mechanism of force. I submit that in the estimates which are before the committee to-day we are still clinging to the idea of the

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mechanism of force. Nearly every nation is doing the same, although we did dream for a little while of substituting the machinery of justice. He goes on:
To carry out this idea practically, we imposed upon Germany, who was accused of trampling by organized violence on international right, the most ruthless destruction of its peccant armaments.
When the German delegates displayed' natural hesitation about accepting these conditions, which reduced their fatherland to impotence in an armed world, Clemenceau wrote them a letter on behalf and at the request of his colleagues, assuring the Germans that their disarmament would be treated as a prelude to steps for general reduction of armaments by the other nations.
This pledge is also expressed in the covenant of the League of Nations. It was accepted by all the signatories of the treaty and ratified by their senates.
Two out of four who drafted that solemn undertaking have passed away, Clemenceau and Wilson. Signor Orlando and I remain.
Now I ask the committee to listen to this:
As one of the two survivors, I have no hesitation in accepting the German view that the victorious nations have shamelessly broken faith on the question of armaments. I should be surprised to hear that my co-survivor, Orlando, took a different view of the turpitude of the victors in this respect.
That is strong language, but it is the language of one who knew the situation, and it is substantiated by the text of the treaty itself. He said:
I have no hesitation in accepting the German view that the victorious nations have shamelessly broken faith on the question of armaments.
Then he went on:
, The Germans revolt against unscrupulous agitators and designing militarists. Statesmen of the fatherland' have for thirteen years shown a degree of patience, forbearance and restraint which is worthy of the great people they represented. Throughout this period the bond they entered in an hour of crushing defeat was being enforced relentlessly against Germany and her allies, whilst other parties to the contract insolently refused even to discuss performance of their part of the agreement.
Under the circumstances I do not think that we can altogether blame Germany for the action which she has taken, lamentable as we feel that it is. But that simply opens up the whole question of what we are going to do about it. Comparatively few of our Canadian people have taken the Versailles treaty very seriously. Within the last few weeks the present government have been introducing considerable legislation on the ground that it was obligatory on us to implement pledges which we made at the time of the signing of
the peace treaty. Notwithstanding that, we have not taken the league seriously. We have been members, it is true, but we hardly ever discuss in this house what the league is doing; in fact the tendency has been more or less to scoff at the league. I confess that for a long time I for one had no use at all for the league. To me it was largely a league of victors, and it was only after other nations, such as Germany, began to come in that it seemed to me that possibly it might be used as an instrument for bringing about peace. To-day I am not so sure whether under the present leadership, and under the present system, we can depend upon the league. In any case I submit that we in Canada have not carried out our obligations as members of the league. For example, article 10 says:
The members of the league undertake to respect and preserve as against external aggression the territorial integrity and existing independence of all members of the league. In ease of any such aggression or in case of any threat or danger of such aggression the council shall advise upon the means by which this obligation shall be fulfilled.
Or again, article 16:
Should any member of the league resort to war in disregard of its covenants under articles 12, 13 or 15, it shall ipso facto be deemed to have committed an act of war against all other members oif the league, which hereby undertake immediately to subject it to the severance of all trade or financial relations, the prohibition of all intercourse between their nationals and the nationals of the covenantbreaking state, and the prevention of all financial, commercial or personal intercourse between the nationals of the covenant-breaking state and the nationals of any other state, whether a member of the league or not. . . .
The members of the league agree, further, that they will mutually support one another in the financial and economic measures which are taken under this article, in order to minimize the loss and inconvenience resulting from the above measures, and that they will mutually support one another in resisting any special measures aimed at one of their number by the covenant-breaking state ...
These are some very clear cut pledges that we, together with the other signatories, gave at the time of the signing of the peace treaty. We had the matter tested in the case of the incident in Manchuria when Japan, although not formally declaring war, practically engaged in war against China and took part of what was generally recognized as Chinese territory. What did we do? Our representatives rather meekly followed the lead of Sir John Simon in the matter and refused to live up to our obligations, with the result that Japan ultimately took over Manchuria, set up her own puppet state there and to-day is launching still further attacks upon China that seriously
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menace the peace of the far east. We have not lived up to our obligations under this treaty.
Now I come to the question of the purpose of our army. I asked the Minister of National Defence to-day how far we are prepared for effective action. He said not a word as to our obligations under these clauses of the treaty, not a word. If we are in any sense depending upon securing peace through the league, then it seems to me the only thing we as a member of the league can do is to live up to our obligations. Surely that is a reasonable position to take. But we have persistently refused to surrender any of our narrow self-interest. We have refused to surrender our sovereignty -and not we alone but nearly all the nations of the world-notwithstanding that all history shows that smaller units have had to give place to larger organizations, and that to-day no nation can live into itself.
I must confess I often feel, as I know a great many of my fellow Canadians do, that we must more or less retire into ourselves and escape from entangling alliances with Europe. But suppose we do try to live to ourselves; have we solved our problem? I come back to this question: Are we in Canada to-day prepared to throw ourselves into an adequate national defence scheme? If we alone, without reliance upon the British empire or upon the members of the league of which we form a part, propose to defend ourselves against all comers, then it is surely obvious that our defence is hopelessly inadequate. Instead of spending $15,000,000 I suppose we ought to pour out the money, but I do not think we would be any better off then than we are to-day. Are we going to depend upon Great Britain? If we are I am QOt so sure that logically the advocates of a contribution to the British navy have not a good deal to say for themselves. If we are going to depend upon that navy it might be well said that we should contribute to it. I say this might be the logical position to take, though personally I cannot believe that our salvation will come about through depending upon the British navy or making a contribution to it.
Are we going to depend upon the United States? I fancy that in case of an outbreak say between Japan and the United States, Canada would be dragged in and it might very well be that the United States would be glad to defend us against aggression. Then is our destiny to be absorbed by the United States? Some of my ancestors came to Canada after the revolutionary war in order to

be on British territory, and I cannot very well contemplate political absorption by the United States, much as I should like to see a very much closer economic connection than we have to-day. But are we going to depend upon the United States? Is there nothing ahead but international anarchy?
When I brought up this matter a year ago it was the acting Minister of Immigration, if I remember rightly, who rather rebuked me. He decried this talk about war, but there has been war in the past and I submit that if the predisposing causes remain there will be war in the future, and we cannot very well read the dispatches of the last few days without recognizing that war in the not remote future is not an improbable thjng. Most Canadians want peace. When I brought up this matter the other night the Minister of Railways (Mr. Manion) delivered a regular tirade against me, and spoke as though I had been lecturing the house. Nothing was further from my thoughts. I am not intending to do that now. The Minister of Railways spoke as though we could take it for granted that we all wanted peace. I think most of us do want peace; I think most hon. members opposite and most of the Liberals want peace, just as we in this corner and most of the citizens of Canada want peace. There is an occasional man, however, who seems to hanker after war. About a year ago I noticed in the press that Colonel Cock-shutt had this to say:
These have been rather dark days for soldiers, but the glorious days will come again. . . . Europe to-day is in a turmoil, and Canada's men of war may yet be needed. The spirit of the empire still lives.
I hope that is not characteristic of the attitude of a majority of Canadians, but I do urge that we are not going to get peace simply by wishing for it or praying for it; we will get world peace only as we definitely adopt those measures which will bring about peace. By relying upon the expenditure of $15,000,000 we are only deluding ourselves as to our security.
I think perhaps one thing ought to be fairly well taken for granted, and that is that Canada should not be committed to war except with the consent of the people.


Paul Mercier: Then we will not need a navy.


James Shaver Woodsworth: I do not think
the people would consent, but I think the hon. member who has just interjected a re-

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mark will agree with the principle that Canada should not be committed to war except with the consent of her people. This does not seem so very radical when we remember that Right Hon. Arthur Meighen, in that rather famous Hamilton speech of October 10, 1927, said:
If ever the time should come when the spectre of 1914 should again appear I believe it would be best, not only that parliament should be called, but that the decision of the government which, of course, would have to be given promptly, should be submitted to the judgment of the people at a general election before troops should leave our shores.
That seems not an unreasonable suggestion; I think that is fairly sound. I know there would be dangers in anything like an election or a plebiscite, but there are dangers whatever way we look. By signing the Kellogg pact, we have renounced war as an instrument of national policy. Am I right in interpreting that to mean that no Canadians should be forced to leave Canada's shores? Possibly most of us would like to take that position, yet a merely negative policy will get us nowhere. I am urging that if we are serious about this matter we must either throw ourselves much more definitely into individual national defence, which I think is hopeless, or else we must more definitely strive to develop the collective system of security. In civil life we have set up our courts and our boards of arbitration. Cannot we do more of that sort of thing in international affairs?
I admit that this problem is very complicated. It is a problem of the ages. People keep asserting that we always have had war and we always will have war. Ah, the wars of the past were comparatively small, local wars-until the last great world war, but I think it is recognized by everyone that any future war must be on a very extensive front and that it will be far more devastating than anything we have known in the past, even the world war. It would seem as though we, as rational beings, should at least attempt some action that would prevent furtheT disaster. Only to-day I received a letter from a French mother in the province of Quebec begging me as an individual to do something to save her children from ever being dragged into another war. She had been reading the papers for the last two or three days, and she asked that something should be done. Surely these appeals by our Canadian people, the fathers and mothers across this country, cannot go unregarded.
I want to emphasize this point, even if I have to repeat it again and again. I do not 92582-119
think that by passing defence estimates, by maintaining the military, naval and air strength that we have to-day, we are doing anything effective to defend this country. I am one of those "impossible idealists," if you like to use that phrase, who believe that by this physical force upon which we have depended in the past we can no longer be sure of defending our people or this country. The world war proved convincingly that war is futile. The other day someone on the other side of the house, I think it was the Minister of Railways, was rather inclined to imply that I was not sympathetic enough to the returned men who fought in the last war.


Robert James Manion: I did not make any statement of that kind.


Mr. WOODS WORTH:: I am glad to think the minister did not make that statement, and I quite readily accept his word. I want to state that some of us do admire the heroism of the men who fought in the last war. I have met a great many hundreds, yes thousands of them, and I believe the returned men are among the foremost in stating that they do not want to go to another war. They do not believe that through war we shall obtain permanent peace. Can we not work out the implications of statements of that kind? I have ventured to delay the passage of these estimates for this length of time- Perhaps I should not admit I am delaying their passage-because I believe this matter is of tremendous importance. It seems to me there ought to be a more complete discussion of the whole situation. Perhaps it would be more fitting if such discussion came under the Department of External Affairs, but we cannot separate the two. The Department of External Affairs might be expected to determine our policy, but we must remember that under this vote we have the army through which we would execute a policy that involved military action. For that reason the two departments cannot be separated.
My purpose in opening the discussion has been to call attention to the inadequacy of our present defence, the inadequacy of any military defence under the existing world conditions, and the absolute necessity of taking more seriously our obligations under the league. We must come to realize that it is not sufficient merely to be a member of the league. If we are to have security we must pursue the long and arduous task of gradually developing a certain peace technique ; we must work out constructive policies which may involve the scrapping of many of our old narrow nationalistic and militaristic ideas.

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These may have to go, but the future of our country and of our children is at stake. I urge that we do not delude ourselves into thinking that we are safe because we pass an estimate for $15,000,000.


Mr. CAMPBELL:: Mr. Chairman, I have listened with a good deal of interest to the observations of the hon. member for Winnipeg North Centre (Mr. Woodsworth), and I listened, too, to his discourse only a few days ago regarding what we should do towards establishing peace not only in Canada but in the rest of the world. To-day he has indicated what we should do to protect ourselves. I do not think any hon. member would expect a vote of money sufficient to protect our great mileage of coast line and the mileage of international boundary between this country and the United States. As the youngest member in His Majesty's loyal opposition in this House of Commons I believe I am speaking for the younger generation in Canada when I say that if Canada is called upon to defend herself she can depend upon the boys and girls of this country to do their utmost in her protection. I do not make that statement boastfully, but rather to express the view that we would in her actual defence be only too proud to emulate the splendid qualities of the young men of 1914-15.
To-night I do not wish to say anything further regarding war and the view taken by the alarmists of the present situation. I sincerely trust that the situation is not nearly so serious as it appears to-day. I have risen to ask a question of the minister regarding one of the most serious wars with which we are now confronted, namely the war against hunger and starvation, a condition with which many people in the Dominion of Canada are faced. Some few nights ago the hon. member for South Perth (Mr. Sanderson) asked the minister to place on Hansard the number of relief camps, by provinces, and the number of men employed in each. Would the minister give that information to the committee?


Grote Stirling: I laid that statement on the table the following day.


Milton Neil Campbell: I was not aware of that, and must thank the minister.


Mr. MITCHELL:: I have listened attentively to the speeches which have been made concerning war. Having served in the last war I believe I may speak with some practical experience. Upon many occasions I have observed that the next war in Europe, so far as we are concerned, must be cash on

delivery. Notwithstanding that fact, however, I believe we must come to earth and view the matter from a realistic standpoint. I am a staunch supporter of the League of Nations; I believe in its development and, if necessary, in the maintenance of an international police force. As Canadians however we must get down to earth and find out where we fit into the world structure. If we may judge from the amount of the expenditure now involved the world has not much to fear from this dominion so far as the development of a warlike spirit is concerned. Our fortunate geographic position places us in a position where we are not called upon to make enormous expenditures for armaments. If we were situated as are New Zealand or Australia, in the cockpit of the next war in the Pacific, quite possibly we would have to take an entirely different attitude in matters of defence. Whether we like it or not Canadians must make up their minds where they fit in, so far as the Pacific question is concerned. We must decide whether we will go along with the Anglo-Saxons and maintain those ideals for which we stand, or whether in the event of war in the Pacific we would remain neutral.
The hon. member for Winnipeg North Centre (Mr. Woodsworth) has indicated that we cannot wish ourselves out of the situation. We will have to take a realistic viewpoint, as the Australians have done. The population of Japan, that small island in the Pacific is growing very rapidly, and that country feels it needs an outlet for its surplus population. Should they take it into their heads to cross the Pacific and attempt to settle some of their surplus population in Canada, I should like to feel that we would be secure. I believe the next war may begin something like smallpox; you do not know where it is coming from or when it is going to strike. I should not like it to be said that I am advocating the development of our war services, but I should like to have careful consideration of our position not so much in relation to Europe as in relation to the Pacific. No one has supported more strongly than I have the devolpmemt of the League of Nations as a practical, and driving force towards the1 maintenance of world peace. We must remember however that we cannot divorce ourselves from what is going on around us. As the nation with the fifth greatest trade in the world I believe Canada is most fortunate to be mere or less sitting in the laps of Great Britain and the country to the south of us. Our defences are not at all in conformity with the position we occupy

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in world trade. Our good fortune lies in the f.aot first, that we are fortunate in our geographical situation, and second, that we form part of the commonwealth of the British empire.
At the moment the peoplte of Australia are recognizing the gravity of their situation, and I believe we must consider carefully our position. I believe any hon. member who passed through the last war, as I did, would not wish another one, and in that stand I believe they would be supported by the Canadian people. However we must be practical about the matter and take into consideration the attitude of the predominant world forces towards the defence of those institutions which have been developed after much sacrifice.


Miss MACPHAIL:: It is now clear that the treaty of Versailles was an iniquitous treaty, and that war would inevitably result from it unless it were modified. The treaty was based on vengeance. It sought to put the whole blame on one nation though it is now historically admitted that one nation was not wholly to blame. The allies tried to make Germany pay an impossible sum by way of reparations, and then would not receive payment in goods. As the hon. member for Winnipeg North Centre (Mr. Woodsworth) has pointed out, they made very definite promises to Germany but did not keep them. That is to say, we the allies smashed the treaty of Versailles all to pieces to suit our purpose, and we cannot very well now suddenly work up a lot of righteous indignation and say that nations which we regarded formerly as our enemies are now showing signs of becoming once more militant. We indeed have sown the wind and almost surely we shall reap the whirlwind. I think the great and ever-increasing cause of war is the bitter competition or struggle for ever diminishing markets. We want to dispose of the weight of goods which each nation is seeking to sell in what are called the markets of the world, though no one knows what that means or where those markets are, and notwithstanding the fact that the people in each country would like to enjoy the goods which they are making such strenuous efforts to sell abroad. In my opinion we have, in the great mass of the unemployed in this country and elsewhere-here it is comparatively small seeing that our population is small-a tinder box. The unemployed have little hope in life, no hope of adventure, no hope of being able to move, no hope of having a variety of food, clothing and entertainment, so that war might seem an interesting thing to them. After all there W582-119i
would be food, clothing and shelter, and some certainty of death at the end. That I know is a terrible statement to make, but I believe there is a good deal of truth in it. Unless the economic problem is solved in each nation or by all the nations cooperating-and in my opinion it will be solved largely by each nation individually-so that the goods which we have in such abundance can be made available to the people of the country, allowing for international trading in those commodities which one nation needs and another wants, then I say that war is inevitable. There are two methods of distributing goods, one is to change the economic system within the country itself, and in my opinion this involves far-reaching monetary changes. The other method is provided by war. If war were declared to-morrow, within forty-eight hours we should be doing the very things which we now say we cannot do; we know very well that the moment war was declared we could move all the goods and services required and we should be able to finanace the moving of those goods and services. To put it in other words, we should then discover that real wealth is the basis of wealth tokens or money. I am apprehensive. I wish I could be as lighthearted about the whole matter as the hon. member for Frontenac-Addington (Mr. Campbell) who seems to think that anyone is an alarmist who talks about war. I do not think he is reading the signs of the times very well if he comes to that conclusion, because the signs are ominous, the real remedy for war lies deep; it lies in justice, economic justice within the nations and between the nations. I believe we could do a lot within our own nation. I agree with someone who said that Canada has not taken her work in the League of Nations very seriously. Once I had the privilege of attending a meeting of the League of Nations and I heard an address iby the Great German, Stressmann, I had to wait for the translation before I could know the words he used, but though I did not know the language he was speaking the power of that speech and the spirit of it reached me. It reached me though spoken in a different tongue. He pleaded with the world and with Germany to avoid the very condition that has developed since. He saw it coming clearly and tried to persuade the world to avoid it, but it seems very difficult for us to avoid the things that we ought to avoid.
I do believe in the collective system. I think that the League of Nations if given the moral support of all the nations could do great things. I believe in an international police force; that I think is necessary. It is the
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only sort of army to have at all and it should be sufficiently strong, acting for all the nations, to bring the aggressor into conformity with the ideas of all.
May I give a quotation from a speech delivered by Field Marshal Sir William Robertson in London, England at a chamber of commerce banquet on November 8, 1927. In this speech he said:
Again, we no longer agree, without qualifications, that the best way of preventing war is to prepare for it. Instead of preventing war, we know that preparations are apt to precipitate it.
And again:
War has become, in short, a wholly detestable thing; is almost, if not quite, as disastrous to victor as to vanquished; and consequently many people condemn it as a failure, hate the very word war, and demand all-round measures of disarmament.
While the amount of money we are voting is not large compared to the military budgets of other nations, if the methods it provides for are not adequate in protecting us against the danger that threatens, then even the amount voted here, something approximating $15,000,000, could be spent to very much better purpose in the dominion at the present time.


Thomas Reid: Has the minister the information regarding the name of the firm that supplied the tobacco to the relief camps?


Grote Stirling: I have not yet been
able to ascertain the name of the firm that supplied the tobacco but I would call the attention of the committee to the result of the investigation I made with regard to the potatoes which the hon. gentleman kindly sent across the chamber-potatoes brought from one of the camps at White Rock. He made some statements with regard to the contract under which these potatoes were supplied. I obtained a copy of the contract and ascertained that tenders were called for from thirteen different firms and people of whom four were individual farmers, and of the rest one was a farmers' exchange and one the Pacific Coast Growers' Cooperative Association. The contract was let to the lowest tenderer, which was F. R. Stewart and Company, and the price for the potatoes was $25 per ton. My hon. friend gave second hand information that F. R. Stewart and Company paid certain farmers of his acquaintance sums ranging from $3.75 to $5 per ton. I am quite ready to believe the hon. member's statement but I think the committee will agree that it is quite impossible to find out what successful contractors paid to the

farmers from whom they bought potatoes. A letter was written at that time by the Pacific Coast Growers' Cooperation Association and I should like to quote one paragraph which touches upon the difficulty of continuity of supply. It reads:
The growers of this association wish me to convey their thanks and appreciation for being given this opportunity of tendering on relief camp contracts as well as for past business.
We regret however that these contracts call for six month period which means this organization being only in its infancy and not having all facilities intact for handling long term contracts, we feel in justice to the government and all concerned it would be much better for us to cooperate with some wholesale house. If this should he a cold winter vegetables will have to be placed in storage in order to take care of your out of town camps, and if we tendered and our contract was accepted it would mean you would have to pay increased prices to take care of storage.
I suggest that if this association takes this view, there is really little likelihood that individual farmers would be in a position to tender direct.
In connection with tobacco furnished in the camps, the hon. member will recall that in giving the component parts of the $1.30 cost per man per day, it was stated that one and one-third ounces of tobacco was issued each week to the men. It was found that when	a certain	kind of	tobacco	wasfurnished to the camp the men would ask for other kinds and the consequence was that instead of	the actual	tobacco	being issued
each week, so many cents were given to the men so that they would have the opportunity of obtaining the kind of tobacco to which they were accustomed.


Thomas Reid: I am glad the minister has made this	statement,	because	I was	verycareful to	have my	figures correct.	The
minister stated $25 per ton was paid and the superintendent of the camp told me the the price was $24. I think it would be very easy to ascertain that the wholesale price for potatoes in the Fraser valley was $5 per ton. This was for No. 1 grade and in many cases it was impossible to make a sale. In connection with the continuity of supply, I pointed out to the Minister of Labour (Mr. Gordon) that the former government of British Columbia purchased from the individual farmers when they were looking after these camps. The cost per meal has increased a few cents under the dominion government as compared with the cost per meal under the provincial government which purchased supplies from different farmers. Investigations at that time proved that there was no difficulty in obtaining supplies in that district.

Questions
In connection with tobacco, I inadvertently gave the wrong company. The company referred to should have been the Macdonald company and not the Imperial. The contract was originally for forty cents and was gradually increased to seventy cents per pound.


Olof Hanson: I have listened with great interest to the speeches of the hon. members for Winnipeg North Centre (Mr. Woodsworth), East Hamilton (Mr. Mitchell) and Southeast Grey (Miss Mac-phail). I should like to ask the minister if consideration has been given to the request that a suitable patrol station be located on the Pacific coast in case of attack from the orient. I know this request has been made by different chambers of commerce and associated boards of trade pointing out the strategic positions of the different localities.


Grote Stirling: A request of this nature has been received from Prince Rupert. Consideration has been given to the matter but so far it has not been decided to divide the stations on the Pacific coast. I do not mean to say that it may not be done in the future.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned without question put, pursuant to standing order.
Wednesday, March 20, 1935