[Stage Direction]
On the orders of the day:
Right Hon. W. L. MACKENZIE KING (Prime Minister):: I wish to reply to another question relating to international affairs asked yesterday by the hon. member for St. Law-rence-St. George (Mr. Cahan), in respect to the ratification of the Canada-France convention. Following approval by the Canadian parliament, the convention concerning the rights of nationals and commercial and shipping matters between Canada and France was ratified by the king in respect of Canada on June 30, 1933. No steps have yet been taken to arrange for the exchange of ratifications under article 21 of the convention, as ratification has not yet been effected by the appropriate authorities of the French republic. A Senate committee last week made a report favouring ratification of this convention.
VIMY PILGRIMAGE On the orders of the day:


Mr. E. R. E. CHEVRIER (Ottawa East):: I wish to direct a question to the Secretary of State (Mr. Rinfret). Will returned soldiers in the employ of the government under the prevailing rate system of pay enjoy the same rights and privileges that have been extended to such returned soldiers as are in the employ of the government as civil servants under the Civil Service Act, to attend the Vimy pilgrimage in the coming summer?

Canada-U. S. Trade Agreement


Hon. FERNAND RINFRET (Secretary of State):: It is the intention of the government to extend such privileges to all classes of civil servants who are returned soldiers. Those employed under the prevailing rates are appointed by the civil service commission, but it has been represented to me that the leave regulations of that commission do not necessarily apply to all of them. In order to remove all doubt I have given instructions that steps be taken to extend to that class of civil servants working under the prevailing rates the same privileges as have been extended to other classes of civil servants who are returned soldiers, in order to allow them to attend the Viray pilgrimage if they so desire.



WAYS AND MEANS

[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved that the house go into committee of ways and means.

Mr. J. R. MacNICOL (Davenport):: Before Mr. Speaker leaves the chair, on a question of privilege I should like to ask his honour's ruling in connection with a ruling of the acting chairman (Mr. McPhee) of the committee against myself yesterday. I was reading-


Mr. SPEAKER:: I think the hon. member is not in order in asking for a ruling at the present time, if he did not appeal the ruling when it was given.


John Ritchie MacNicol: If your honour retires from the chair without granting me the privilege, and the committee has the same acting chairman (Mr. McPhee) it had yesterday afternoon, he will perhaps rule again that editorials praising the government's legislation are a reflection on it.


Walter Edward Foster: Order.


John Ritchie MacNicol: I want to find out from your honour what constitutes a reflection.


Walter Edward Foster: I think the hon. member should have raised the point when the question came up.


John Ritchie MacNicol: I did, your honour, but had I challenged the ruling it would have meant an appeal to the house, and I did not like to disturb your honour in the afternoon when you were resting.


Walter Edward Foster: I think the hon. member is out of order.
Motion (Mr. Dunning) agreed to and the house went into committee, Mr. Beaubien in the chair.



CANADA-UNITED STATES TRADE AGREEMENT

[Stage Direction]
Customs tariff-503. Planks, boards, clapboards, laths, plain pickets and other timber or lumber of wood, not further manufactured than sawn or split, whether creosoted, vulcanized, or treated by any other preserving process, or not, free.
Mr. BARBER:: What is the United States tariff on commodities similar to those included in items 503 and 504?


Mr. DUNNING:: That question will arise
under schedule II of the agreement. I have before me the details for schedule I.


Harry James Barber: What has been the tariff?


Charles Avery Dunning: The rate on flooring of
maple, birch or beech was 8 per cent ad valorem. Under schedule II that rate is cut in half, and of course the excise is also cut in half.


Harry James Barber: For the same class of
goods?


Charles Avery Dunning: I am sorry I did not hear the hon. gentleman.


Mr. CHURCH:: I was a member of the
last parliament, Mr. Chairman, and we had a committee on housing and reconstruction which went into the class of materials dealt with in item 503, in connection with housing and reconstruction. What the hon. member for Dauphin (Mr. Ward) said last night was illuminating as far as it went, but he left out the main facts, and after all facts are facts. What happened to the lumber industry in this country under the free trade policy of the Liberal government? Some hon. gentlemen talk about taking the tariff out of politics, but it never will be taken out of politics and it is a blessing that it never can be, because tihe tariff vitally concerns the jobs and livelihood of the vast majority of our population.
As I was saying, we had a committee of this house appointed last year to look into housing and reconstruction, and I want to say a few words in reply to my hon. friend from Dauphin, who talks about the vast number of men who were thrown out of employment in this country in consequence of the action of the United States government imposing a duty of four dollars per thousand feet on the importation of Canadian lumber, as compared with the duty of one dollar per thousand feet which previously prevailed. Why, Mr. Chairman, in the United States they had nearly twenty-four million people unemployed, fourteen million living on relief works, and ten million on direct relief, and they had to introduce the NRA and go into large reconstruction and housing schemes to give em-

Canada-U. S. Trade Agreement
ployment to their idle workingmen. Materials, planks, boards and everything else required in housing had to be supplied.
I have before me the report of the assessment commissioner for Toronto showing how the construction industry has contracted in recent years. Conditions on this continent are very different from conditions in Italy, where lumber is being used to build municipal institutions to satisfy the requirements of the next twenty-five, years, for court houses, all kinds of hospitals, and many other public buildings, and Italy, of course, is providing the labour and the materials.
The investigation that was made by the parliamentary committee places the matter in an entirely different light from that presented last night by the hon. member for Dauphin.
Here we are in this particular committee, composed of 245 members of the House of Commons, considering the different items in this trade agreement. Can you imagine any business trying to conduct its affairs in a committee of 245 members? We have been discussing this trade agreement for five or six days, and it is said that we must not yet look at schedule II. As a matter of fact the United States is giving us nothing but gold bricks, while we are giving them extremely valuable concessions. And you, Mr. Chairman, preside over this committee of 245 members. You are really the chief coroner, because we are just holding a post mortem; everything in this agreement is already signed, sealed and delivered. Our hands are tied and we can do nothing about it; we cannot change a word of it. There is no reciprocity at all in this agreement. The President of the United States himself in his message to congress said that his powers in making tariff changes were limited by the constitution to a change of not more than fifty per cent in the tariff in connection with any foreign trade agreement. We are giving the United States the benefit of our intermediate tariff. We are admitting many of their products free, and in return we get very little. Business people here in Canada to-day have to pay duplicate, and in some cases triplicate, income taxes. It means that any benefit that might have been coming to men in the building industry will be more than wiped out by the taxes they will have to pay. Many of these men are being driven to the wall. But here we are, sitting in a committee of 245, considering item 503, and we cannot change one word of it or of any other item in this agreement. We have to take the whole thing as it stands because any amendment vitiates the whole agreement. As the Prime Minister has said,
l*Mr. Church.]
we cannot change it to the extent of dotting an "i" or crossing a "t". I should like to have moved that this item be struck out altogether, Mr. Chairman, but parliamentary rules prevent me from doing that. One of the main things we need in this country is constitutional reform, so that we can properly consider these important matters. We have been sitting here five or six days talking about an agreement that has been signed, sealed and delivered, and the free representatives of the people in this parliament might just as well not be here for all they can do about it.
Ministers and ambassadors from this country have gone down to Washington in years gone by and have come back with far better agreements than this. I see my hon. friend from North Huron (Mr. Deachman) in his seat. He had something to say about this agreement yesterday. At one time he was a supporter of the government of Mr. Drury in the province of Ontario. In 1924, on April 2, representatives of the Canadian Council of Agriculture came to Ottawa and presented to the cabinet a memorandum in which they urged that relief be granted to the agricultural industry. Mr. Drury denounced the manufacturers as thieves and robbers and asked for free trade, not only in agricultural products but in lumber. They threw away a whole principality of timber to an American millionaire, Mr. Backus. Such happenings run through the whole history of the lumbering industry of this country, and of Ontario in particular.


The CHAIRMAN (Mr. Beaubien):: Will the hon. gentleman kindly keep to the item under discussion? I do not think that Mr. Drury has anything to do with this item.


Thomas Langton Church: I do not think it is
necessary for you to speak in that way, Mr. Chairman; I know the rules as well as you do. They have been read three or four times already. As I say, this is only a post mortem examination. They have tried to make a lethal chamber out of this place and the Minister of Finance has been appointed the lord high executioner. He is a very capable executioner. If you do not want any more discussion on this item, I can only say that for twelve years Mr. Drury tried to have this free trade lumber provision put into effect. If I am not entitled to discuss the principle involved in this item, you can rule me out of order. I do not wish to say anything further if we cannot discuss the principle of this item. The hon. member for Dauphin (Mr. Ward) was allowed to discuss agricultural implements last night; he wandered all over the different tariffs put

Canada-U. S. Trade Agreement
into effect by the last three or four presidents of the United States, but when a member of the opposition gets up to discuss the principle of this item he is told he is out of order. The principle in this vole is the relief of unemployment, and it is relevant.
What is the minister doing with the experts in the tariff board? As I read the statutes, no change can be made in the tariff of this country unless approved by that body. I contend that this agreement is out of order for that reason, and that it would be declared ultra vires if sent to the courts. There are many experts on this agreement under the lord high executioner; he has in front of him two of the finest young men we have in the civil service. We are fortunate to have such gentlemen in the service and I ask him if they recommended this change.


Charles Avery Dunning: There is no change. This item has been free and it will remain free.


Thomas Langton Church: What is this big tariff
board of this and other governments doing? They might just as well be a travelling minstrel show with their faces blacked. All they do is act as doctors, chopping off a limb there and a limb here. This item was not free before this agreement. The United States tariff was one dollar per thousand, and then four dollars.


Charles Avery Dunning: Your government
appointed them.


Thomas Langton Church: Away back in 1911 this
very same item was considered by Mr. Paterson and Mr. Fielding. This was considered back in the days of Sir Wilfrid Laurier and the present government does not realize that this proposition will make a Lazarus out of a country that Sir Wilfrid Laurier professed to have made a nation. We are going to have so much free trade that no man will put a dollar into industry. Mr. Drury made new Ontario the happy hunting ground for the American millionaire. They crossed into this country and bought up all the timber limits. Only the other day a carload of lumber came into Ottawa under this item. Where is that lumber? It is down in the Rideau canal beside the Chateau Laurier being used to fix u,p Canada's new navy of tugs, and scows, and other such craft. The people of this country should not have to pay more for any commodity because of any combine which might exist. I suggest that the Minister of Finance and his experts should decide a fair amount to be allowed for labour and profit-in the manufacture of agricultural implements and other articles. The remainder could be considered an excise tax to be paid into the federal treasury. That would be
real protection, not only for the agricultural implement industry but for the consumers as well.
There are many industries in my riding, and during the time I spent in public office many millions of dollars' worth of lumber were purchased. Practically all the lumber used by the Toronto harbour commission was brought in from British Columbia through the Panama Canal. This was done in order to help the lumbering industry in British Columbia. The Minister of Labour (Mr. Rogers) is not in the chamber, but I think he should make a statement with reference to these items. Only one man knows anything about this American agreement and he negotiated it so quickly that he ignored entirely the high court of parliament. Talk about Hitler and Mussolini; this is just as bad as anything they ever did. They could not get away with similar action down in Washington. Our Senate has gone on a holiday instead of holding an investigation to help this committee. Is the committee aware that an investigation is now being conducted by the senate in Washington into what is known as the lobby inquiry presided over by Senator Black. This committee is investigating the lobbying which has been carried on at Washington by industry, the tactics referred to last night by the senior member of my party. It has been shown that
7,000	false telegrams were sent out in an effort to influence the newspapers and various important people throughout the country about tariff legislation. The New York Times of March 3 contains an article giving a full account of what has been going on before this committee, and the Ottawa Journal of this morning makes reference to the same investigation.
The whole agreement should be referred to the tariff board. What is the use of having a tariff board? It is ridiculous and a squandering of the taxpayers' money to have a tariff board with its many experts not doing the work it should be doing. Business men in Ontario are wondering how long this free trade is going to continue. I know of one factory which intended to put on more men, but when the manager saw this article about the tariff he decided not to increase his staff. We should have some explanation from the government of the day as to why these duties have been removed. A royal commission has been appointed to study the textile industry; one should be appointed to study the lumbering industry before we approve this agreement. Timber limits all over the country have been given away to Americans by Liberal governments. I can remember when Peter Ryan was appointed an auctioneer to auction off these

Canada-U. S. Trade Agreement
limits and nearly three-quarters of the bidders for timber berths were Americans. They came over here and they found Canada a happy hunting ground.
The more I study this agreement the more I believe the people should vote on it. We cannot vote on it. As the Prime Minister has said, this is a treaty which has been signed, sealed and delivered. It has been agreed to by the two high contracting parties, Canada and the United States, and we cannot do anything about it. We can go on talking about it, but nothing plus nothing equals nothing; we might just as well go back home and tell our constituents that there is no such thing as constitutional government in this country.


Mr. PURDY:: Mr. Chairman, I represent
the riding of Colchester-Hants where the people are very much interested in the lumbering business. Being engaged in that business myself I should like to say a word before this item carries. I was rather amused to hear what hon. members on the opposition benches had to say with respect to our trade with the United States. They refused to accept responsibility for the great drop in our trade with the republic to the south; they said they had nothing to do with it and that it was not a measure of retaliation on the part of the United States which prevented our Canadian lumber from going in. Surely they will grant that when they came into power in 1930 we had a market of $56,000,000 in the United States whereas when they went out of power that market, for lumber and lumber products, had been reduced to $10,000,000. Now they turn around and claim to have saved the lumber industry of Canada by means of the empire trade agreements. But what did those agreements do for our lumber? What they did was to bind the duty already existing on certain classes of material. What has really happened is this, that to-day the price in sterling we are getting in the old country for our lumber is not as favourable as the price we received before the empire agreements came into force. The value of the pound sterling has risen from around $4.25 to about $5. I do not think that our friends in the opposition can take credit for that, and therefore they are not entitled to take credit for any great increase in the export of lumber to the United Kingdom.
My hon. friend from Royal (Mr. Brooks) the other night said that the trade agreement would do the maritimes no good; he said that the people there were still selling lumber to the United Kingdom and could not sell to the United States. If he had inquired further he would have found the reason why the mari-

time lumbermen are to-day able to secure a better market in the old country for their products. The answer was given yesterday by the hon. member for Dauphin (Mr. Ward) when he pointed out that the British Columbia lumbermen are now sending their lumber into the United States, and this having released the pressure on the English market has allowed the maritime lumbermen to sell their products there. So far as the maritime lumbermen are concerned, we are shipping into the United States a good deal more lumber than we did before the treaty was signed. If you will look around in Nova Scotia and New Brunswick you will see a great many lumbermen preparing to ship in the summer when navigation opens up, and therefore as regards the maritimes the treaty will be of considerable benefit.


Mr. STEWART:: I had hoped last night
that we should be able to finish the whole of this schedule. About a quarter to eleven the item was really passed and then there took place some discussion which seems to have obscured the situation. I suggest that we wandered rather far away from the particular item under consideration and I would also suggest that we pass the item, and if we have further questions to ask we might take them up in connection with schedule II with regard to lumber.


Charles Avery Dunning: Thank you.


[Stage Direction]
Item agreed to.
Customs tariff-504. Planks, boards and other lumber of wood, sawn, split or cut, and dressed on one side only, but not further manufactured, free.
Item agreed to.
Customs tariff-505. Sawn boards, planks and deals, planed or dressed on one or both sides, when the edges thereof ane jointed or tongued and grooved, 20 per cent.
Sir GEORGE PERLEY:: What is the tariff on this item going into the United States?


Charles Avery Dunning: The nearest comparable 'item appears to be flooring of birch, beech and maple. That was formerly 8 per cent and under the trade agreement is 4 per cent ad valorem entering the United States. If it came within the classification of rough and dressed lumber and pine, fir, spruce, hemlock or larch, the duty prior to the treaty was $1 with a tax of S3. The trade agreement makes the duty 50 cents and the tax $1.50.


[Stage Direction]
Item agreed to.
Customs tariff-506. Manufactures of wood, n.o.p., 20 per cent.
Item agreed to.

Canada-U. S. Trade Agreement
Customs tariff-520. Raw cotton and cotton linters not further manufactured than ginned; rags and waste wholly of cotton, unfit for use without further manufacture, not to include used garments nor waste portions of unused fabrics, free.
Mr. EDWARDS:: What was the duty
formerly on this material coming into Canada?


Charles Avery Dunning: It has been free for many years. This has the effect of binding the free entry.


[Stage Direction]
Item agreed to.
Customs tariff-573.	Enamelled carriage,
floor, shelf and table oilcloth, linoleum, and cork matting or carpets, 32J per cent.
John Ritchie MacNicol: What was the value of the Canadian manufacture of linoleum and oilcloth in 1935?


Charles Avery Dunning: We have no production figures in Canada inasmuch as the industry does not comprise three separately reporting firms, so that we have no definite information.


John Ritchie MacNicol: I know there is a fairly substantial production in Canada of this line of material.


Charles Avery Dunning: I think that is true.


John Ritchie MacNicol: The duty has not been reduced very much unless the 4 cents a pound is taken into consideration. On looking up the trade figures I note that the poundage is mentioned in connection with each figure. In 1931 we imported from the United States 8279,000 whereas in 1935 but as a result to a percentage of the late government's protective policy, we imported only $20,000 worth. It appears that we have been importing this line more extensively from Great Britain than from the United States, for in 1931 we imported 8371,000 and in 1935, 8165,000. These figures are taken from page 514 of the large trade return book. In reference to that book, I should like to say in passing that when the minister inquired regarding the page, when I was quoting with reference to printing machinery yesterday, item 412a, b, c, and d, I referred him to pages 338 and 339. I should have said 611 and 612.
Coming back to the item under discussion, I should imagine that one result of this duty would be that importations from the United States would largely increase, and on the other hand importations from Great Britain would decline. If we have to import from outside I should be sorry to see us import more of this line of material from our cousins to the south than from our brothers in the old land. I do not know the number of men employed in this country; I could not find
out in any of the year books. But if it affects employment in Canada it will be unfortunate.


Mr. ROSS (Moose Jaw):: Under the
British empire agreements Canada bought about 81 worth of goods from Great Britain where they bought about S3 worth from us. Hon. gentlemen opposite seem to be very much perturbed now because the Americans might sell some of their goods in this market and affect the Britisher selling here, but they put into effect a treaty which has made it possible for the Britisher to sell only $1 worth here where we sell S3 worth over there. The main object of their agreement was to try to keep the Britisher and everybody else out of this market. I think it is about time they stopped talking about giving somebody else the opportunity that they gave Great Britain.


Hugh Alexander Stewart: Did the minister give
the imports from Great Britain?


Charles Avery Dunning: The hon. member for
Davenport (Mr. MacNicol) gave them.


[Stage Direction]
Item agreed to.
Customs tariff-ex 598a. Brass band instruments, of a class or kind not made in Canada, 25 per cent.
Mr. WERMENLINGER:: What were the
imports into Canada from the United States, the United Kingdom, and Czechoslovakia, in the last fiscal year?


Mr. BOULANGER:: What about Scotland?


Charles Avery Dunning: I can answer my hon.
friend with respect to every country he mentions except Czechoslovakia; I will try to find that in a moment. From the United States we imported $27,000 worth of brass band instruments, from the United Kingdom $10,000 worth, and from France $5,500 worth. That makes $43,000 out of a total of $45,000, so that we cannot allow any more than
82,000	worth from Czechoslovakia.


Edgard Jules Wermenlinger: Under this item are the brass instruments separate from the silver plated ones?


Charles Avery Dunning: No.


Edgard Jules Wermenlinger: What is the
difference, comparatively?


Charles Avery Dunning: I think I shall have to
refer that question to the Minister of National Revenue. I cannot explain it.


Edgard Jules Wermenlinger: I admit, from
the figures furnished by the minister, that

Canada-U. S. Trade Agreement
the imports were not very considerable during the last fiscal year. Of course we had an awful depression. But if times become normal our brass bands, which even now are increasing all over the country, may grow to a point where we shall have to import a large number of musical instruments, either brass finished or silver plate finished. May I suggest, if I am in order, that the duty of twenty-five per cent provided for by this agreement be reduced?


Some hon. MEMBERS:: Hear, hear.


Edgard Jules Wermenlinger: I have not finished. I am saying these things because we have no brass manufacturing industries producing musical instruments in Canada. I suggest that the tariff be reduced to 20 per cent on the purely brass and increased on the silver plated ones from 35 to 40 per cent, to give a chance to our numerous silverplating and electro-plating plants to get some work.


Charles Avery Dunning: Oh, that is the catch
in it.


John Gordon Ross: I agree with my hon. friend that we ought to reduce the tariff on the brass instruments, and I should be in favour of reducing the duty on silver ones too. Throughout Canada at the present time we have many returned soldier bands the members of which are spending a good deal of their own money in order to maintain them, and the instruments cost them a considerable amount. I think that we should make an exception in such cases; if they want to import instruments for the purposes of the bands they should be allowed to bring them in free.


Ernest Edward Perley: You are magnanimous.


Edgard Jules Wermenlinger: I admit the force of what the hon. member for Moose Jaw (Mr. Ross) has said. But you must also bear in mind the fact that most of the brass bands of this country, especially in the two oldest provinces, are made up of boys. They are subsidized either by civic authorities or, as in the province of Quebec, by religious authorities. The cost is considerable. If you reduce the duty on the brass finished products, after a while those who at the beginning of their musical career are enabled in this way to purchase a purely brass instrument may, if they find they have the talent and the natural disposition to continue, acquire a gold plated or silver plated instrument. By this means we shall be enabled to give work to numerous concerns-and I have here a list of about

twenty-five silver plating industries in Montreal-which are practically idle now; they have no trade.


[Stage Direction]
Item agreed to.
Customs tariff-599. Hides and skins, raw, whether dry, salted, or pickled; and raw pelts, free.
Ernest Edward Perley: What treatment do we receive on similar goods sent to the United States?


Charles Avery Dunning: Ten per cent, if the hides are the bovine species, and all others are free.


Ernest Edward Perley: Can you give us the imports and exports under this item?


Charles Avery Dunning: 
Alexander McKay Edwards: IVhat is the duty on finished leather going into the United States?


Charles Avery Dunning: I cannot say offhand. It varies according to classes of leather and the degree to which it is manufactured, and so forth. I have not that before me on this item.


Thomas Langton Church: I note that items 599 and 601 deal with the same subject matter. The city of Toronto has as many members on this side of the house, namely nine, as there are on our side from seven provinces; and there is only one member from the maritimes with us, but if conditions go on as they are we shall have a large delegation from there. With your permission, Mr. Chairman, I will refer to a letter which I have received from Mr Chester S. McLure, who sat in the last parliament, and who has taken a great deal of interest in this particular item.


Charles Avery Dunning: That is the next item.


Thomas Langton Church: It refers to this one, 599. The people of the city of Toronto take a great deal of interest in the maritime provinces, and when a member writes me it is my duty to express not only his view but my own. This particular industry used to employ a great deal of labour in the largest cities of Canada. The fur trade is an old industry, since the days that The Company of One Hundred Associates sailed up the St. Lawrence. There was some protection for them then; there is none for them now.
We have heard a good deal about how this relates to unemployment. I say it is going to have a very serious effect, not only in

Canada-U. S. Trade Agreement
the maritime provinces which supply the needs of that district but also in the central provinces of Canada where the large markets are located. In a recent issue of the Cleveland News I find this paragraph:
Figures from the League of Nations and from Washington about the decrease in unemployment since March, 1933, show that we are lagging behind Canada, Sweden, Belgium and Great Britain, and that we are just a trifle ahead of Japan. These statistics come from official sources in Washington and Geneva. The United States News illustrates with smokestacks of varying sizes the percentage of decrease in the number of jobless in each of the six countries.
According to these statistics the decrease in unemployment in these countries was as follows:
Per cent
Canada	 42
Sweden	 36
Belgium	  27
Great Britain	 24
Unite*! States	  19
Japan	 18
If you remove these tariff barriers you are going to create more unemployment. I should like to quote from a letter I have received in connection with this fur item from Mr. Mc-Lure, former member for Queens, Prince Edward Island:
Re Canadian tariff items 599-601; Article 3, Schedule 1. Also United States Tariff Act 1930, item 1681, of Article 4, Schedule 2. In this tariff item you will see the words "not specially provided for."
These three items are very important to the fur farmers of Canada, and especially so to the silver fox farmers of Prince Edward Island', who are the pioneers of fur farming conservation of the world.
Raw furs, or raw skins, have always been on the free list in every country in the world since Adam was a boy.
Raw furs in the early days was the currency in many countries. The United States is the only government in the world to place a duty on raw furs, with perhaps the one exception of a war tax during the Great war, when two or three countries for a short time placed a small tax on ray furs.
Briefly, the tariff is as follows: The present American duty on fox skins was imposed on June 17, 1930, and effective June 18. 1930. The provisions of the previous tariff with respect to fox skins were however unchanged.
The effective date of the last three tariff acts enacted by the Congress of the United States were as follows:	October 4,	1913;
September 22, 1922, and June 18, 1930. The sections covering fox skins under these tariffs were as follows:
1913. Paragraph 348. Furs dressed on the skin, not advanced' further than dyeing, 30 per cent ad valorem. Also paragraph 604. Skins of all kinds, raw, and hides, not specially provided for in this section.
1922. Paragraph 1420. Silver or black fox skins, dressed or undressed, not specially provided for, 50 per cent ad valorem.
1930. Paragraph 1519. Silver or black fox furs, or skins, dressed or undressed, not specially provided for, 50 per cent ad valorem.
Thus you will see that silver fox furs are the only raw furs subject to the prohibitive tariff of 50 per cent ad valorem.
The raw fur merchants of the United States are favourable to this item being on the free list; and I am certain had the Bennett government secured a treaty, that raw silver fox furs would have had consideration at least by a reduction of 50 per cent, to be 25 per cent ad valorem. The Wisconsin and Minnesota fur farmers and the farmers' bloc of the western states simply held their representatives up and secured this protection for and in the interests of their own producers.
Prince Edward Island pioneered in silver fox conservation farming and sold' breeding stock to all other countries now carrying on this industry in the different fur zones.
The United States farmers, after getting their foundation breeding stock from Canada, placed a 15 per cent duty on pure bred registered and pedigreed live silver foxes for breeding purposes (contrary I believe to all regulations regarding the interchange of pure bred stock). At the same time they placed a 50 per cent ad valorem duty on raw silver fox furs. This was in the year 1922.
Canada admits United States raw silver fox furs, and the same with all other raw furs, duty free. Now when the United States has a surplus of the low and inferior grades of raw skins they ship them into Canadian and British markets to compete and lower our prices in general.	.
We produce a better fur in Canada than in United States, generally speaking, and if we could get into the United States markets with our goods skins, even at a reduced duty of 25 per cent ad valorem, it would mean a very material advantage for our high class fox furs or raw skins. The United States is a good market, and just to show you that they cannot supply their own trade, quite a number of skins of the better grades are shipped from Canada even in the face of a 50 per cent ad valorem duty.
These tariff items that I have mentioned here. I believe, and I am confident that you can deal very effectively with them, and the thousands of fur farmers in every province in Canada will rise up and call you blessed. Likewise, all the raw' fur merchants in Canada and the United States.


Charles Avery Dunning: Mr. Chairman, I for one cannot hear a word my hon. friend is reading, but it is all going on Hansard. At least we should have an opportunity of hearing it. What little I do hear certainly has no bearing on the item before the committee; apparently it relates to the next item. Personally I am anxious that my hon. friend should have the greatest possible latitude, but surely there are limits.


Charles-Philippe Beaubien: I may tell the minister that as far as the chair is concerned item 599 was carried and item 601 was called.


Thomas Langton Church: I do not agree with placing this item on the free list. I just said this

Canada-U. S. Trade Agreement
gentleman had written me and I was giving his views. They are not necessarily my views, but I believe in protecting those in the fur trade, and I think this change to the free list will lead to greater unemployment. The letter from which I quoted referred to both items 599 and 601, fur skins of all kinds.


Mr. BROOKS:: I wish to say a few words with regard to this item. I may say that my constituents are greatly interested in fox furs and in the production of furs generally, and I quite agree with what has been said by my hon. friend from Broadview. The maritime provinces are probably the home of the fox fur industry, particularly Prince Edward Island. To show just what this industry amounts to I might say that in 1935 we produced 190,000 silver fox pelts valued at 87,000,000. Of this total some 83,000,000 worth came from the little province of Prince Edward Island, between 81,000,000 and 82,000,000 worth from New Brunswick and the remainder from the rest of Canada. The objection of the fox fur producers is that while we have to pay a 50 per cent ad valorem duty if we send our fox furs to the United States, under this item they are permitted to ship furs into Canada free. In other words we are entirely shut out from the United States market while the fur producers of that country can send their furs to Canada without the payment of any duty.
In that connection I might also say that to-day the United States is the great competitor of the fox fur producers of Canada. Last year in that country they produced
160,000	pelts while we produced 190,000. They have our market in Canada free; they also compete with us in markets all over the world, and I understand that in no other country in the world is there a tariff against fox furs. That is what the fox fur producers are objecting to. A few years ago, Mr. Chairman, live foxes were shipped to the United States from Prince Edward Island and New Brunswick where we have the largest fox farm in the world, in the village of Salisbury. As soon as they had enough of our pure bred fox stock to form ranches of their own the United States imposed a 15 per cent duty against that pure bred stock, and I understand also that it was because of the representations made by the fox producers of Wisconsin and other western states that we were not given a reduction in the United States tariff on foxes and fox pelts entering that country. On behalf of the fox producers of the maritime provinces, as well as those in other parts of Canada, I feel that I am justified in protesting against this item.
A few moments ago the hon. member for Colchester-Hants (Mr. Purdy) said the people

of the maritime provinces were quite satisfied with the treaty, or words to that effect. I want to say, Mr. Chairman, that they are not satisfied with it. I repeat what I said here a few days ago; they are not satisfied. Ask the fishermen of Queens-Lunenburg; read your Nova Scotia newspapers, and you will find out how satisfied they are. As far as lumber is concerned, my hon. friend said that in 1930 our lumber was denied entry to the United States. That happened before the Conservative government came into power.


Gordon Timlin Purdy: I did not say that.


Charles Avery Dunning: We are on furs just now.


Alfred Johnson Brooks: The hon. gentleman referred to me in his remarks and I am just replying to him. However, as I said a moment ago, we are not satisfied with this treaty, and this is just another item in connection with which the people of the maritime provinces have been greatly prejudiced. It might be of interest to know the amount of furs that have been shipped into Canada from the United States. I find that the United States shipped fox furs into Canada in the following amounts:
1931		 $472,950
1932		 154,278
1933		 154,375
1934		 252,892
My understanding is these are inferior furs that cannot be sold in their own country, and having free access to our markets they send them in here to compete with our furs. Then again we are producing in this country on farms, and also catching wild, many mink. This item also comes under this tariff, and I believe there is a reduction from 15 per cent to 10 per cent.


Charles Avery Dunning: No, this item is all free and has been free, coming from the United States into Canada. It is not changed at all.


Alfred Johnson Brooks: Not otherwise provided?


Charles Avery Dunning: No, fur skins of all kinds, not dressed in any manner. They have been free and continue free.


Alfred Johnson Brooks: Well, that makes it all the worse. As far as undressed mink skins are concerned, the imports from the United States into Canada were as follows:
1931		 $338,379
1932		 116,306
1933		 71,642
1934		 217,778
This, I contend again, is in competition with our Canadian mink fur growers. Then take muskrat, a very important fur in Canada, and particularly in the maritime provinces. According to the figures of the bureau of statis-

Canada-U. S. Trade Agreement
tics the United States shipped into Canada muskrat skins as follows:
1931		 $1,065,018
1932		 742,763
1933		 345,053
1934		 1,069,381
I am protesting on behalf of the fur growers of my own district and other parts of the maritime provinces,


Charles Avery Dunning: On this item I think I should put in a word for my own constituents who are silver fox producers. There is of course no doubt that the producers of foxes in Canada would have been delighted to secure free entry into the United States for fox furs, the same treatment as is accorded the furs of all other fur bearing animals. I assume my hon. friend would expect that any government negotiating an agreement of this kind would do its best to secure a concession in respect of an article of that description. But as to the seriousness of the situation as affecting our producers, I point out that our total exports of fox skins to all countries last year were $5,700,000, and we imported from the United States of that article $89,000 worth and exported to the United States
S197,000	worth. I think my hon. friend is correct in saying that certain low grades of skins come in, but the important thing for the fox producers of this country is export markets; for among the ten million people of Canada there certainly is not a sufficient number of potential silver fox buyers to sustain the industry that this country is capable of developing in that line. We are anxious to develop export markets for this commodity and have succeeded. The growth of this industry is quite remarkable; it is indeed an indication of the manner in which the people of Prince Edward Island have been able to build up a new industry adapted to the climatic conditions and the special situation of that province. It is a very valuable industry from the standpoint not only of foxes but of other fur bearing animals as well. When we see for instance that last year our total imports of furs of all kinds under this item were $2,600,000 and our total exports $14,800,000, it emphasizes the great importance to Canada still, notwithstanding the development of other industries, of Canada's original industry, that of producing furs. I may point out further that of that total our importations from the United States amounted to $1,700,000, whereas we exported to the United States S4,000,000 worth. I assure my hon. friend that this government is desirous of encouraging in every way the intelligent development of an industry potentially so valuable as this one, and will make
every effort to obtain and develop markets for its products.


Ernest Edward Perley: The minister will not mind if I say it seems to me he has made a very strong argument why our furs should be admitted to the United States free on the same basis as theirs are admitted here.


Charles Avery Dunning: Agreed.


Ernest Edward Perley: But they have not accomplished that.


Charles Avery Dunning: They have not accomplished that.


Mr. YOUNG:: We have heard a good deal about fox farming in the maritime provinces. It may surprise some hon. members to know that in Saskatchewan we do a lot of fox fanning. We brought a man from Prince Edward Island and he imported the foxes from that province, but he then did what we usually do in Saskatchewan-we improve things. He went out and won the championship of the world. And finally, Mr. Chairman, we are not asking for protection.


Hugh Alexander Stewart: Like the minister, I was under the impression that the prior item had not been carried, although the chairman allowed the discussion of No. 601, to which the minister objected. On that item-


Charles Avery Dunning: Which item?


Hugh Alexander Stewart: No. 599, the one before.


Charles Avery Dunning: He ruled against me.


Hugh Alexander Stewart: I think he was wrong. The minister said that the exports and imports were about equal, but as I recall it there is a handicap of ten per cent going into the United States on cowhides, bovine hides.


Charles Avery Dunning: Bovine species, 10 per cent; all others free.


Hugh Alexander Stewart: But they are free coming into Canada.


Charles Avery Dunning: Yes, and they have always been free.


Hugh Alexander Stewart: That is all right, but this is a case in which I think we ought to have got equality of treatment. Then about furs; the minister says wre are anxious to develop an export market, surely the United States ought to be a field where many people can buy the most valuable silver fox furs.


Charles Avery Dunning: It is our second most valuable market now.


Hugh Alexander Stewart: Still they have a duty against us, although they come in here free.


[Stage Direction]
Item agreed to.
[Stage Direction]
Canada-U. &. Trade Agreement
Customs tariff-624a.	(i) Dolls; toys of all
kinds, n.o.p., 30 per cent; (ii) Mechanical toys of metal, 30 per cent; (iii) Juvenile construction sets of metal, consisting of various stampings, punched, and connections therefor; parts of the foregoing, 30 per cent.
Mr. MacNICOL; As this is the last item that pertains to manufacturing I have a word or two to say. I am under the impression that some of the material mentioned in this item is made in Christie street hospital by the returned soldiers' vetcraft shops. They may not make the mechanical parts, but I believe they do make toys. This is a fairly substantial reduction, but of course it cannot be helped on account of binding the intermediate tariff.
Charles Avery Dunning: I am sure the veterans do not want a protection higher than thirty per cent.


John Ritchie MacNicol: If the minister had the Christie street hospital in his riding he would find they want a lot of things. They have been in my riding for five years and I heard from them frequently.
This being the last item, I am going to take the opportunity, Mr. Chairman, to compliment you; you make an excellent chairman. Having said that, I hope you will let me call attention to some editorials, because yesterday I was ruled out of order, unjustly, for reading a few editorials complimenting the government.


Some hon. MEMBERS:: Order.


John Ritchie MacNicol: I am in order. The editorials sincerely compliment the government on this agreement, but the chairman who preceded you, sir, said the editorials were reflecting on this agreement. I looked up the word in the dictionary and I found that "reflect on" means to censure and unjustly criticize, but these editorials compliment and praise the government. I should like to read one for the benefit of the hon. member for North Huron (Mr. Deachman), who yesterday kindly suggested to the chairman that he permit me to read an editorial. I am not sure that the Prime Minister has not a copy of this in his hand right now.


William Lyon Mackenzie King: Yes, I have.


John Ritchie MacNicol: It consists of 235 editorials from approximately as many cities and towns in the United States, covering the forty-eight states. I will read just one.


Some hon. MEMBERS:: Order.


William Lyon Mackenzie King: Mr. Chairman, may I say to my hon. friend I think the rule is that when a discussion is taking

place it is not permissible to read news items emanating from persons outside the house, and referring to anything said by a member or expressing any opinion on proceedings within the house. What my hon. friend is proposing to do is to read some newspaper articles from United States papers which are in the nature of editorial opinion relating to the subject under discussion here. If he is given that right I would have to be given that right, and I could find just as many articles that show the benefit of this agreement to the continent as a whole as he could find to support the contention he is making that the agreement is to the advantage of one particular country. It is to avoid the possibility of bringing in discussion from outside that the rule is there, and I do not think it should be violated.


John Ritchie MacNicol: Then I shall not read
the article. I think too much of the Prime Minister to oppose him in this regard.


William Lyon Mackenzie King: Thank you.


John Ritchie MacNicol: And when I say I think
a lot of the Prime Minister, that is from my heart. The trend of all this United States newspaper comment is that this agreement will provide employment for the factories of the United States. I believe that. They say that the agreement at the same time will provide a home market for the American farmer. I believe that too, and that is what I would hope we shall get here, a home market for the Canadian farmer by increasing production in Canada.


William Lyon Mackenzie King: Having read
the articles, Mr. Chairman, I may point out that what they say along the lines the hon. member has indicated may be said equally with respect to the effect of the agreement on Canada. The position, however, is a bit reversed. May I point out that what helps the Canadian farmer and other primary producers will help to make a home market here for the Canadian manufacturer. Conditions in Canada are going to be materially improved by virtue of the increased trade that will take place between the two countries. I could read many of the editorials which assert this-


John Ritchie MacNicol: I shall not object to the Prime Minister reading them. Go ahead; I think you should read them.


William Lyon Mackenzie King: It would not
be in order. The editorials for the most part point out that this agreement will be mutually beneficial; that it breaks a hole in the wall of economic nationalism which has

Canada-U. S. Trade Agreement
obstructed trade between the different countries of the world; that it is an example which ought to be followed by other nations, and that altogether it is working for the great good of both the nations immediately affected and for the good of the countries of the world generally.


John Ritchie MacNicol: The opposition, I am
sure, will not oppose the Prime Minister reading as many of those editorials as he wishes. I will not ask to read any more if the Prime Minister will read a few of them.
Mr. STEWART- What is the rate of duty in the United States on articles corresponding to those in this item?


Charles Avery Dunning: If my hon. friend ships
dolls to the United States the duty ranges from 50 per cent, plus one cent each, to 90 per cent. If he wishes to ship dolls' clothing the duty ranges from 70 to 90 per cent, and the duty on toys ranges from 50 to 70 per cent ad valorem, plus one cent each.


Hugh Alexander Stewart: What are the imports of these articles from the United States and elsewhere?


Charles Avery Dunning: The imports of dolls of all kinds from Germany amounted to 840,000; Japan, 827,000; United States, 821,000; United Kingdom, 82,000. Imports of toys of all kinds, from the United States, 8428,000; Germany, S237,000; Japan, $231,000; United Kingdom, $155,000.


Mr. HEAPS:: What is our production?


Charles Avery Dunning: There is no record. The production is too small to come within the statistics.


[Stage Direction]
Item agreed to.
Customs tariff-654. Bristles, broom corn, and hair brush pads, free.
Item agreed to.
Customs	tariff-663.	Fertilizers, compounded or manufactured, n.o.p., 7£ per cent.
Charles Avery Dunning: This is binding the intermediate tariff.


[Stage Direction]
Item agreed to.
Customs tariff-ex 711. Rapeseed oil, blown when for manufacturing purposes, free.
Item agreed to.
Hugh Alexander Stewart: Before we leave schedule I I would ask the minister to what extent the right to value for duty purposes under section 43 of the Customs Act has been affected by this agreement. It seems to me that this 12739-75
is a relevant question to discuss in connection with this schedule.


Charles Avery Dunning: Not at this point. Anything connected with section 43 of the Customs Act is dealt with in the supplementary note to the agreement, and will be dealt with in due course in legislation.


Hugh Alexander Stewart: The supplementary note to which the minister has referred is dated November 15, 1935-


Charles Avery Dunning: It is not before the committee.


Hugh Alexander Stewart: -and apparently it is
made part of the agreement itself.


Charles Avery Dunning: No.


Hugh Alexander Stewart: Then what does it mean? That is my interpretation of it. The note
says:
In the meantime, and pending the entry into force of the legislative changes foreshadowed in this note, the Canadian government are prepared as from the 1st January, 1936, to cancel the values for duty purposes, established under authority of section 43 of the Customs Act of Canada and now applicable to the undermentioned goods, the produce or manufacture of the United States, on importation into Canada: Meats, fresh, prepared' or preserved; eggs, frozen, desiccated, powdered, et cetera; loganberries, dried; slack cooperage stock; lime; doors of hardwood; women's and children's clothing; fabrics of cotton or of artificial silk; fringes, gimps and tassels; electric light fixtures; lamps and shades; roses, cut; canned asparagus; eggs in the shell; baby chicks; peas, dried; beans, dried; market poultry; iive stock; canned salmon; sugar of milk.


Charles Avery Dunning: Purely as a matter of order, Mr. Chairman, and I am sure my hon. friend does not want to be out of order, we are on article III of the agreement. We have discussed the schedule mentioned in article III and we are now in the position of carrying article III. What my hon. friend is referring to really does not relate to article III at all. I shall have no objection at the proper time to discussing the point he raises, but it would be out of order to do so now. The rule is quite distinct that discussion in committee must be strictly relevant to the item under consideration, and I know my hon. friend does not want to follow the example of some others and wander far afield. I have no desire to avoid discussion on the point, but obviously there is a proper place for it.


Hugh Alexander Stewart: It seems to me, with the greatest respect for my hon. friend's opinion, that this matter does relate to a large number of the items contained in schedule I, and



Canada-U. S. Trade Agreement
affects the rates of duties on these commodities entering Canada. Instead of dealing with it on each particular item it would only be fair and proper, when we are through with the schedule, to deal with it as it relates to the whole schedule. It does not relate to any one particular item. I should like to ask the minister when he thinks an opportunity for discussion would be given more appropriately than under schedule I?


Charles Avery Dunning: The effect of the arbitrary valuations upon individual items was discussed when those items were before the committee. In connection with some of the items there was considerable discussion as to the effect of the removal of the arbitrary valuations which had been in force under the government of my hon. friends opposite. However, it seems to me that having lost the opportunity for what might be called a general discussion at that point, a further opportunity is given only when any action is taken by the government in a legislative way to implement the contents of the note dated November 15, 1935, addressed to the United States government. It was administrative action that was taken. My hon. friend read what it was. In no way did it affect the law. We undertook to remove certain fixed valuations as of a certain date. That promise has been implemented; the artificial valuations to which my hon. friend referred have been removed.


Hugh Alexander Stewart: In discussing certain items we discussed the right to fix a valuation for duty purposes as there was a provision to that effect in connection with those items. The minister says "when any action is taken by the government," but action has been taken.


Charles Avery Dunning: I said, when action is taken to propose an amendment to the law. What my hon. friend is discussing is an administrative action.


Mr. ILSLEY:: Item No. 12 on the order paper covers the second reading of Bill No. 11, to amend the Customs Act. This bill deals with the amendment of section 43. When this bill is before the house I shall be prepared to discuss the matter which the hon. member would like to discuss now. As a strict matter of order I suggest that that is when it should be discussed, rather than when we are dealing with a reciprocity agreement. That is not part of this reciprocity agreement. As Minister of National Revenue I cancelled a large number of the special valuations referring to the items in the list read by the hon. gentleman. We are introducing an amendment to section 43 and other sections of the
(Mr. Stewart,]
Customs Act and at that stage of our proceedings a discussion of the action of the Minister of National Revenue in cancelling these valuations would be strictly in order.


Hugh Alexander Stewart: I would admit at once the contention of the Minister of National Revenue if it were not for the fact that this letter of November 15 has to all intents and purposes been made a part of the agreement. If it covered some action that was to be taken without reference to the agreement, if it were not a part of it and not for the purpose of implementing the provisions and understandings arrived at, then I would say the minister was correct. But this note is really a pari of the agreement, and I submit that the proper place to discuss it is when we are discussing the agreement. It has an effect upon schedule I, and we ought now to be given an opportunity of discussing its effect upon the schedule.


Charles Avery Dunning: I submit that that procedure would be entirely out of order, for the reasons advanced by the Minister of National Revenue. The fact is that there is already notice of legislation upon the order paper. The only way in which this can be dealt with is by amending the specific statute, which amendment is being presented to parliament at as early a day as possible. It is a question which must be discussed in parliament, but there is a proper time and place for that discussion. In order to avoid confusion in dealing with these matters, I submit that this discussion is out of order.


Hugh Alexander Stewart: It seems to me the Minister of Finance has missed the point. Perhaps I have not made myself clear. If it were a matter of legislation that was required and upon which no action had been taken, then his contention would be sound. Let me read again one paragraph of the letter, as follows:
In the meantime and pending the entry into force of the legislative changes foreshadowed in this note, the Canadian government are prepared as from the 1st January, 1936, to cancel the values for duty purposes, established under authority of section 43 of the Customs Act of Canada now applicable to the undermentioned goods, the produce or manufacture of the United States, on importation into Canada.
There is action taken; it is not action contemplated at all.


Charles Avery Dunning: That is the whole point. The existing law gives to any government the power to do or undo in connection with the matter to which my hon. friend refers. What comes before this parliament are the necessary

Canada-U. S. Trade Agreement
legislative changes, and these are covered by the bill already referred to. There is no legislative proposal before this committee dealing with section 43 of the Customs Act and the powers extended to the government thereunder. That necessary legislation is on the order paper and will come forward in due course. It comes partly in consequence of the undertaking given in the note to which my hon. friend refers, but surely it is a well known ruling that when notice of an amendment is on the order paper, when it is down for discussion by parliament at a future day, discussion cannot presently be entered upon in connection therewith when an entirely different matter is before the committee.


Hugh Alexander Stewart: I am not anticipating discussion at all; I am inviting and contending for a discussion on an accomplished fact, just as this agreement itself is an accomplished fact. The discussion on this agreement has not been discussion anticipating proposed legislation; it has been a discussion upon something that has been done and that is now effective. It does not require any legislation to make it effective.


William Lyon Mackenzie King: May I say just this word? What the hon. member has read refers to what is a part of the government's general policy with respect to arbitrary valuations; it is not something peculiar to this agreement. He read from a letter which accompanied the agreement and which contained a statement indicating the government's general policy with respect to arbitrary valuations. It is not peculiar to this agreement; it is part of the general policy with respect to arbitrary valuations.


James Lorimer Ilsley: It applies to all intermediate tariff countries.


Hugh Alexander Stewart: But a special undertaking is given with respect to this agreement.
Article III agreed to.
On article IV:
Articles the growth, produce or manufacture of Canada, enumerated and described in schedule II annexed to this agreement, shall, on their importation into the "United States of America, be exempt from ordinary customs duties in excess of those set forth and provided for in the said schedule. The said articles shall also be exempt from all other duties, taxes, fees, charges, or exactions, imposed on or in connection with importation, in excess of those imposed on the day of the signature of this agreement or required to be imposed thereafter under laws of the United States of America in force on the day of the signature of this agreement.
Schedule II and the notes included therein shall have full force and effect as integral parts of this agreement.


Ernest Edward Perley: Before we go into the schedules I should like to say this to my right hon. friend. It seems to me that in making this arrangement with the United States he has very much overlooked the condition of their tariff at the present time. While the right hon. gentleman was in office the United States in 1922 passed the Fordney-McCumber tariff, the rates of which were very high, higher than in any tariff act previously passed by that country. At that time it was felt in Canada that those rates imposed by the United States were unfair and that they were higher than they ought to be considering that we were such good neighbours. Those increased duties were imposed upon products subject to duty under previous tariffs, but higher rates were provided over a wide range of commodities. For instance, the Fordney-McCumber tariff imposed high rates on certain classes of fish previously free, and those high duties have served adversely to affect our fisheries. My right hon. friend will say that the trade between Canada and the United States increased after the imposition of the Fordney-McCumber tariff. That is quite true. But we must remember that those were years when there was a good deal of excitement throughout the world, prices went up and trade increased, but the whole world suffered the reaction in 1929. But not content with that, the United States in 1930, before my right hon. friend went out of office, passed the Hawley-Smoot tariff, and the increases made in that tariff were such as to lead many people to regard the previous rates as comparatively low indeed. Never before has any country imposed a tariff on the scale of the Hawley-Smoot tariff; indeed, the rates they put into force were prohibitive on a great many of our exports, and the consequence was that the volume of those exports declined materially during the next few years.
What has happened in this instance? My right hon. friend went to Washington and put through this agreement, which he is fond of declaring to be the same as the one we had in mind, though that statement has been contradicted by my leader. However, I would call his attention to this fact. Looking over these rates in schedule II and comparing them with the rates previously in force in the United States, both under the Hawley-Smoot tariff and under the Fordney-McCumber tariff, I find that in most instances the concessions which he has obtained from the United States are so small that even now under this agreement the rates are higher than they were under the Fordney-McCumber tariff. In other words, the United States imposed extreme rates in the Hawley-Smoot tariff, and then my right hon. friend goes to Washington and

Canada-U. S. 'Trade Agreement
enters into an agreement and they say, "We will give you these concessions." And what are they? They are in most instances-the new rates he has obtained-higher than the rates were under the high Fordney-McCumber tariff. I will not labour that point because it has been fully discussed in the house; but I must say that I was surprised to see what the situation was when I looked over these rates.
Let us take milk and cream, items that are of interest to the whole country; certainly they are of interest to the people in my constituency as well as to every other farming community. What is the situation? Under this new tariff arrangement my right hon. friend has obtained a rate of 35 cents a gallon. Under the Hawley-Smoot tariff it was 56^y cents a gallon, and the reduction looks like a large one. But under the Fordney-McCumber tariff it was only 20 cents, and that tariff when it was put into force was regarded as very high, higher than any other tariff they had ever had in the United States. Of what use is the concession to us when the rate on cream is left at 35 cents, seeing that it was 20 cents under the Fordney-McCumber tariff? It is worse than the Fordney-McCumber tariff.
I do not find milk mentioned in the agreement at all. Under the Fordney-McCumber tariff it was 2i cents a gallon, and the present rate is 61 cents. The right hon. gentleman has not succeeded in getting any concession on this very important item. However, I will not labour all this. I simply say as a business man, looking over the figures, that I am astonished to find that these rates which the United States has now given Canada are in most cases higher than under the Fordney-McCumber tariff, which was at that time the highest tariff ever put into force there.


William Lyon Mackenzie King: Everything
my right hon. friend has said about the Fordney-McCumber tariff is equally true with respect to the intermediate tariff on our side. We are giving the United States the intermediate tariff but it is entirely different from the intermediate tariff that existed at the time to which he refers. As he knows, since the government of which he was a member came into office it busied itself every year in raising the general tariff and in jacking up the intermediate tariff to a point where on many items it was scarcely distinguishable from the general tariff. The result is that in giving the United States to-day the benefit of the intermediate tariff Canada does not begin to concede what would have been given in the intermediate as it was in 1930. It is equally true, as my right hon. friend has said, that had the tariff remained where it was some
lSir George Perley.]
years ago, so far as the United States is concerned, the concessions now granted would be greater than they are. But surely that is not an argument against obtaining the benefit of as large a reduction as possible in a tariff that had become practically prohibitive, so as to secure a considerable entry into the American market for Canadian produce and goods.
My right hon. friend has taken care to pick out here and there individual items on which as large concessions as he had wished for, have not been obtained. He has referred to milk. I believe that if his government had begun negotiations earlier than they did, a substantial reduction on milk might have been secured. As he knows, the longer the negotiations were deferred, and the nearer the time of negotiating approached the assembly of congress and a presidential election in the United States, the more difficult it was to obtain concessions as great as they otherwise might have been. As to the concessions not being as great as they might have been, that is in no way the fault of the present administration. It is in very considerable measure the result of the inaction in negotiating of our predecessors in office. When the committee comes to examine, as I hope it will examine in detail these various items, it will find that the concessions obtained are very considerable. When my right hon. friend referred to the Fordney-McCumber tariff he did not refer to lumber, but he will recall that under the Fordney-McCumber tariff, lumber, together with many other commodities, was not in the position to which he has referred. However, I will not take up the time of the committee now. I think my right hon. friend will be answered in full if we go through schedule II item by item, as we did schedule I. The committee will then get an appreciation of the reciprocal nature of the agreement as a whole, and of what has been obtained in the way of concessions by Canada upon articles going into the United States as compared with the concessions we have given to the United States upon commodities coming into Canada.
Sir GEORGF. PERLEY: With some parts of the remarks of my right hon. friend the Prime Minister I quite agree. The question whether the late government was responsible for this has already been discussed ad nauseam; the right hon. gentleman reiterates it, but it has been explained fully that the late government were unable to go on with this negotiation any faster than they did. As far as the intermediate tariff is concerned I call the attention of my right hon. friend to the fact that he has in many instances given the United States a lower tariff than the intermediate tariff. However, I do not wish to get into a general

Canada-V. S. Trade Agreement
discussion at this time. As the question of intermediate rates has been mentioned by the right hon. gentleman, I am wondering whether there will be an opportunity, or when there will be an opportunity, for hon. members to ask questions and obtain information about some of the items of the intermediate tariff which have been granted to the United States, and which do not come under schedule I. About certain of these some hon. members, I think, are very much worried. Will there be an opportunity of asking questions and getting information?-I do not mean about all of these items, but about special and particular ones that some of us are worried about.


William Lyon Mackenzie King: My right hon. friend knows there is still to be a bill based on the resolution now before the house, and when the bill is introduced there will be an opportunity at different stages of the bill to ask questions.


Ernest Edward Perley: In committee
on the bill?


William Lyon Mackenzie King: Yes.


Hugh Alexander Stewart: There is one statement
of the Prime Minister in connection with the imposition of duties by the late government which I think requires a little attention and a little development in addition to what it has received at the hands of the hon. member for Argenteuil (Sir George Perley). He says the duties were raised. Undoubtedly they were, and he knows the reason; he has been told and this house has been told. The general tariff was raised and the intermediate tariff was raised, as he says, but I suggest to him that an examination will show the increases were not as serious as he indicates; the increases in the tariff itself were not very extensive.


William Lyon Mackenzie King: Oh yes, they were.


Hugh Alexander Stewart: The complaint all along has been the valuation for duty purposes rather than the increase in the tariff as such. In the last budget there were reductions on a very substantial number of items in the intermediate tariff and the general tariff.


Mr. McLEAN (Melfort):: I would just like to point out to the hon. member for Leeds (Mr. Stewart) and the hon. member for Argenteuil (Sir George Perley) that in 1930 they and their leader distinctly told the people of Canada that the reason we were suffering at that time was that we were doing too much business for the United States.


Ernest Edward Perley: Not too much business with the United States.


Malcolm McLean: They said that in the previous year $900,000,000 worth of goods came in from that great country and $800,000,000 of exports had gone out, and that that was the cause of our troubles at that time. The government of the day pledged themselves to see that that condition was done away with, that that trade should be killed, and they did kill it. They adopted weapon; in order to kill that trade. But let me poim out that the proportions of the trade remainec the same. At the bottom of the depressior we were still doing about the same proportior of business with the United States that wc were doing in 1930, and we are doing it to-day; because apparently the percentages do not change very much, it is only the volume that changes with these kinds of restrictions. The hon. member for Leeds says that last yeai very substantial reductions in tariffs were made. It is true that reductions were made in the last year or two, because even the late government came to its senses in some slight degree, like a man who has had a severe attack of certain troubles and, beginning to recover from them, regains his senses. The government which had put this country down from the position in which it stood economically in 1930 to the position it occupied in 1932 naturally wanted to help to bring about recovery, and began to make reductions of tariffs from the unparalleled height which they had reached, although that slight lopping off did not bring them down to the position they were in in 1930 and to where they should be in 1936 or 1937 at the latest. But the action taken to keep our trade from the United States was premeditated. Because goods could not come in from the United States the people of this country were not able to enjoy them and were not able to get payment for the goods they shipped to the United States and other markets; for the only way they could be paid for goods sent out was to bring goods in, and the door was slammed in the face of other nations by the late government. I am not blaming that government for doing it. They promised us they would do it and they did it, by a high tariff, by special valuations for duty purposes, by dump duties, by excise and the other devices they adopted; and it is to clear the channel of these obstructions that we are now engaged in this work.
Mr. STEWART; The hon. member for Melfort (Mr. McLean) was good enough to say that the government showed some signs

Canada-U. S. Trade Agreement
of repentance. I have not detected any in his attitude either towards the late government or towards the policy of protection.


Malcolm McLean: My attitude has not been proven wrong yet.


Mr. LAWSON:: It has, but you do not realize it.


Hugh Alexander Stewart: He says that the object of the late government's action was to kill trade with the United States. That is not at all a fair statement; I think that upon reflection hon. members will agree with me. The fact is that there was a very heavy adverse balance of trade, and because of that the financial credit of Canada was in difficulties. Some action was necessary to change the situation, because we could not go on meeting that adverse balance year after year, increasing the deficit.


An hon. MEMBER:: Why not?


Hugh Alexander Stewart: Oh well, let the hon. member ask some of his economist friends; they will tell him very quickly. That was the reason for the action of the late government. It was not for the purpose of killing trade. No intelligent person would have any such intention.


An hon. MEMBER:: They certainly did it.


Hugh Alexander Stewart: No. World trade shrank. It shrank in every country in the world. It shrank in free trade countries, if you can find one. It shrank in Spain, in Germany, in Great Britain, everywhere.


Alexander MacGillivray Young: What purpose had your government in putting on the restrictions that they put on if it was not to limit trade?


James Earl Lawson: To try and keep a few jobs for Canadians.


Hugh Alexander Stewart: The restrictions put on trade by Canada were insignificant in comparison with the restrictions put against her in other countries.


Alexander MacGillivray Young: Even though that is true, why were they put on?


Hugh Alexander Stewart: In the interests of Canadian citizens, Canadian workers. In the interests of my hon. friend himself.


Alexander MacGillivray Young: To further trade or stop trade with other countries?


Hugh Alexander Stewart: No, not to stop trade at all.


Alexander MacGillivray Young: Did it increase trade?


Mr. TURGEON:: I want to put on the record two thoughts in connection with the dis-

cussion concerning this schedule of tariff rates on Canadian goods entering the United States. I am not in a position to follow hon. gentlemen opposite in the comparisons they are making between the rates under this agreement and the rates that existed under some previous United States tariff, but I am in a position to make a comparison between the actual living conditions, now and prior to the agreement, of the people engaged in the industries affected by the rates brought about as a result of this agreement with the United States, and that comparison between the actual living conditions of the people engaged in lumbering, cattle raising and certain other industries is utterly to the advantage of the people of Canada. I am not going to try to follow my hon. friends in their doctrinal discussion concerning a comparison of rates, but if hon. members will consult their own constituents engaged in the industries affected bs' this agreement they will find that no matter what may be the comparison of rates, a comparison of living conditions since January 1, and those previously prevailing, and of the hopes of the people for the next few years, is entirely to the advantage of Canada. After all it is the living conditions of the people that count; I believe the people of Canada are interested in that question in the discussion of tariff agreements.
The second thought I wish to present is this: During the full dress debate in connection with this reciprocity agreement hon. gentlemen opposite told us that because we were allowing trade channels to be opened north and south and because we were going to trade with the United States, we were going to make Canada part and parcel of the American union of states, that we were to become a new state of the union. If that is a real, living fear within their minds in regard to this reciprocity agreement I want to ask why they are so anxious to show the people of Canada that the Prime Minister did not obtain from the United States tariff rates sufficiently low to enable more Canadian products to go to that country, so that the flow of trade north and south would be even greater than it is going to be under this agreement. If they are afraid that the flow of trade, by becoming greater, will make Canada a part of the American union, why are they so annoyed because we are not making that flow even larger by securing greater concessions from the United States?
Mr. MaeINNIS: Mr. Chairman, the members of this group have not said very much during the long discussion on this question,

Canada-U. S. Trade Agreement
and it seems to me that a great deal of the discussion has been very unreal as far as the actual facts and conditions are concerned. My hon. friends opposite have been accusing the present opposition, when in power, of destroying trade. I do not think there is anything to that kind of talk. The world depression put an end to trade.


Malcolm McLean: What made the depression?


Mr. MacINNIS:: My hon. friend should ask the government that was in office when the depression began.


Malcolm McLean: I just want to tell my hon. friend that the depression did not begin in Canada until after the government changed.


Angus MacInnis: Just a moment; I have the floor, and I will tell my hon. friend that the government was defeated because the depression began before they went to the country.


Malcolm McLean: They were defeated because my hon. friend's friends and hon. gentlemen opposite promised to make the people of Canada rich, comfortable and happy, and then did not keep that promise.


Angus MacInnis: Quite so; I agree that they made that promise.


Malcolm McLean: Your friends.


Angus MacInnis: Just a moment; keep quiet. When my hon. friend had the floor I did not interrupt him. The statements made by the former government in 1930 would not have had much effect on the people of this country if the people had not been in difficulty at that time. That is correct.


Some hon. MEMBERS:: No, no.


Angus MacInnis: Yes, of course that is
correct. It was because the Liberal government of 1930 would not even admit that there was a problem confronting the people of Canada that the government was defeated. I am not going to say that from 1930 to 1935 the Conservative government did very much to overcome the depression, because they did not. However, it should be noted that things began to improve while they were in office,, and possibly they will continue to improve for some time to come. But the point that we should remember is that the conditions that brought about the depression of 1930 are still with us and will bring about another depression within a few years, regardless of which party is in office.
I do not believe that the evils that have been suggested by the opposition are going
to befall the country just because of this agreement. Neither am I going to agree that the great benefits the government say will accrue to the country will come about. However, that is no reason why we should oppose this agreement, and we are not opposing it. We supported the government on the agreement, and we will have to judge the benefits of this treaty not from the way it may affect any one industry in particular but from the way it may affect economic conditions in this country as a whole. We cannot judge that within a few months; it will take some little time to find out whether or not the agreement is going to be beneficial.
I am in favour of the agreement, particularly because it is a step towards cooperation. We have started to cooperate with the government of the United States for the purpose of reducing tariffs and making it easier for goods to flow from this country into the United States and from the United States into this country. If we can even begin to cooperate I think perhaps the benefits of cooperation may become so manifest in a very short time that we shall continue to do so on a very much larger scale. So I suggest that we get through with this agreement, or the remainder of it, with a little less discussion than we have had heretofore. It will go through in any case, and we- can only judge of its benefits or otherwise as time goes on. Regardless of what may happen during the course of this agreement the government will have a great many other difficulties to overcome before it can bring prosperity to this country on such a scale that there will be any appreciable effect on the economic life of our people.


James Earl Lawson: Mr. Chairman, I have in
mind a matter which I think might be raised more properly in a general discussion of article IV of the trade agreement than in particular reference to an item of the schedule. I shall intimate briefly what it is, and if the Minister of Finance or the government prefer to have it discussed under the schedule I shall leave the matter in abeyance. Item 802 of the United States Tariff Act of 1930, which is printed in this tabular statement of tariff changes as subschedule 8 to the schedule now under discussion, deals with spirits, wines and other beverages going into the United States.


William Lyon Mackenzie King: May I say
to my hon. friend that we propose to take up these items in schedule II one by one, and in due course item 802 will be reached. I do not think we should reverse the order.

Canada-U. S. Trade Agreement


James Earl Lawson: If tthe Prime Minister will listen for a moment until I outline my problem I shall be glad to accept his suggestion. I was going on to point out that the matter I wish to raise is not merely in respect of the reduction given by that item. It has been brought to my attention that there have been two ancillary legislative matters in the United States which in my opinion offset any advantage that may be obtained from this reduction in the tariff item. All I wish to inquire at this time is: Does the minister or the government prefer that I raise and discuss these matters when the item in the schedule is reached, as they do not relate specifically to the reduction of duty, or should they not be raised now, when I think they are more properly in order?


William Lyon Mackenzie King: There is no
objection to my hon. friend raising them now, if by now he means while we are discussing schedule II. But I think it would be better to wait until we arrive at that number before discussing it.


James Earl Lawson: What I mean is, we are
now discussing article IV, and generally they arise under that article.


William Lyon Mackenzie King: We are discussing article IV it is true, but under article IV there are many items which have to be discussed, the one to which my hon. friend has referred be'ing one, and it comes a little later in the schedule. I think we had better take it then.


Ernest Edward Perley: All that my hon. friend is attempting to do is to have an understanding that no abjection will be taken to his discussing this phase of the matter when we come to the item in due course.


Mr. EULER:: I suggest that we proceed
as we have done all along, item by item. Certainly there can be no objection to discussing the particular item mentioned by the hon. member for York South (Mr. Lawson) when we reach the item to which he refers.
United States tariff-1. Acetic acid containing _ by weight more than 65 per centum of acetic acid, 1J cents per pound.


Ernest Edward Perley: Before we start
with this item, I quite agree that they should be taken one after the other, but I think we are very much interested as to the previous rate on these goods entering the United States, and I suggest to the minister that he give in respect to each item the comparative rates that were charged under the Underwood tariff, the Fordiney-McCumber tariff and the Hawley-Smoot, the present tariff.


William Daum Euler: Under the Hawley-Smoot
tariff the rate was 2 cents a pound; under the Fordney-McCumber tariff it was 2 cents, and under the trade agreement it is 1J cents.


John Gordon Ross: Could the minister give in each case the exports of the last year to the United States, so that we shall have them on record for future reference.


William Daum Euler: For 1935, 349,953 hundredweight, value $2,130,267.


Malcolm McLean: Could the values be given, say, for 1930 and 1935?


William Daum Euler: For 1930, 296,043 hundredweight, value $2,132,944.


[Stage Direction]
Item agreed to.
United States tariff-2. Vinyl acetate, polymerized or unpolymerized, and synthetic resins made in chief value therefrom, not specially provided for, 3 cents per pound and 15 per cent ad valorem.
William Daum Euler: Under the present agreement, 3 cents per pound and 15 per cent ad valorem. Under the Hawley-Smoot tariff, 6 cents per pound plus 30 per cent ad valorem. Under the Fordney-McCumber tariff, 6 cents per pound plus 30 per cent ad valorem. Exports, not available.


John Ritchie MacNicol: I do not find in the trade returns the figures the minister has just given. What page?


William Daum Euler: I have not given any figures; I have given merely the rates.


Hugh Alexander Stewart: On the previous one?


William Daum Euler: I thought No. 1 was carried. The trade returns are shown on page 33 in the tabular statement.


[Stage Direction]
Item agreed to.
United States tariff-11. Synthetic Tesins made in chief value from vinyl acetate, not specially provided for, 3 cents per pound and 15 per cent ad valorem.
William Lyon Mackenzie King: Item 11 is paragraph 11 of the United States Tariff Act of 1930. It appears as the next item in schedule II. Canada, however, obtains the treatment accorded any other nation with which the United States has an agreement. There are many items in the United States tariff which are not included in schedule II and on which the United States has granted concessions in either of the agreements it has made. I think therefore, in order to bring out just what Canada has obtained by way of concessions, as a result of the most-favoured nation provision of the agreement this is an appropriate time to place on Hansard particulars of the benefits accruing through these

Canada-U. S. Trade Agreement
other agreements and which do not appear in this schedule. A statement has been presented to the house in the form of a white paper giving these particulars. I should like to point out, for example, that Canada obtains, by virtue of the United States having an agreement with the Netherlands, a reduction on amyl alcohol from 6 cents to 4 cents per pound, on fusel oil from 6 cents to 4 cents per pound, on laundry sour from 25 per cent to 15 per cent, on ammonium silicofluoride from 25 to 15 per cent, on Haarlem oil from 25 to 15 per cent. These all come under an agreement the United States has with the Netherlands, of which Canada gets the benefit.
Then arising out of the agreement of the United States with Belgium, on aluminum sulphate there is a change in the rate from 0-2 cents or 0-375 cents per pound to 0-2 cents, on copaiba balsam, natural and uncompounded, and not containing alcohol, from 10 per cent to 5 per cent ad valorem through an agreement which the United States has with Brazil. On tolu balsam, natural and uncompounded, and not containing alcohol, there is a reduction from 10 to 5 per cent by virtue of an agreement which the United States has with Colombia.
The items I have referred to are in paragraphs 4, 5, 6 and 10 of the United States tariff. The next item we come to is No. 11, the one the minister has in hand at the moment.


Hugh Alexander Stewart: Following this up, can the minister give us figures of our exports to the United States of the items to which the Prime Minister referred, on which we get most favoured nation treatment? Are there any at all?


William Daum Euler: I regret to say that I cannot give those figures; we do not have them available.


Hugh Alexander Stewart: Apparently they are
trifling.


William Daum Euler: This is a new matter. We are only now getting the benefit of these favoured nation agreements that the United States have with the other countries. My hon. friend will realize no doubt that it would be quite an undertaking to get all these figures now.


Hugh Alexander Stewart: I would think so, on these items.


William Daum Euler: They are, however, being announced week by week.


Hugh Alexander Stewart: Perhaps we could get the
figures on some items.


William Daum Euler: If I have the information I shall be glad to give it.


Ernest Edward Perley: I think that ought to be done. The Prime Minister has read a list of items on which we get these concessions, as if they were of some value. Now, are they of any value to this country? That is what we would like to know.


William Lyon Mackenzie King: Of course they are.


Ernest Edward Perley: Do we manufacture these commodities? Do we ship them?


William Lyon Mackenzie King: Hon. members will be able to see for themselves whether the item is one with which they are familiar.


Ernest Edward Perley: I do not think the minister has given the figures regarding No. 11.


William Daum Euler: Synthetic resin, under the Hawley-Smoot tariff, 4 cents per pound and thirty per cent ad valorem; under the trade agieement, 3 cents per pound and 15 per cent ad valorem. Exports from Canada not given.


[Stage Direction]
Item agreed to.
United States tariff-29. Cobalt oxide 10 cents per pound.
William Daum Euler: With reference to the preferences that we get by reason of favoured nation treatment, on caffeine, for example, the new rate is 90 cents per pound, the same rate for the Netherlands, as compared with the old rate of $1.25 per pound; on theobromine-I admit I do not know what that is-the old rate was 75 cents per pound and the new rate is 65 cents per pound, the same as for the Netherlands; on chalk or whiting or paris white, dry, ground, or bolted, the old rate was 0*4 cents per pound, and the new rate is 0-2 cents per pound, the same as for Belgium, on chalk or whiting or paris white, ground in oil (putty), the old rate was 0-75 cents per pound, and the new rate is 0-5 cents per pound, the same as for Belgium; on flavouring extracts containing more than 50 per cent alcohol, the old rate was 80 cents per pound plus 25 per cent, and the new rate is 60 cents per pound plus 18 per cent, the same as for the Netherlands; on flavouring extracts of various kinds, the old rate was 40 cents per pound and 25 per cent ad valorem, and the new rate is 30 cents per pound and 18 per cent ad valorem, the same as for Belgium; naphthe-lene, the old rate was 7 cents per pound and 40 per cent ad valorem, and the new rate is 3-5 cents per pound and 20 per cent ad valorem, the same as fp- Belgium.

Canada-U. S. Trade Agreement


Hugh Alexander Stewart: There naturally arises, I am sure, in the mind of every member of the committee, the same question that was suggested by the hon. member for Moose Jaw (Mr. Ross), that we should, where possible have the amount of our exports of these articles to the United States. From my knowledge I would say offhand that, with a few exceptions such as flavouring extracts, we do not produce any of these articles. Many of the other items sound very strange to me, so far as Canadian production is concerned. Our trade figures are comprehensive and are given very much in detail, so surely we ought to be able to get some estimate of what our exports of these articles are, and of whether these new duties are going to be of any advantage to us at all.


William Daum Euler: It must be quite apparent that the value of these concessions which we receive by having favoured nation treatment extended to us by the United States must necessarily be to some extent a matter of experience in the future to determine. As to the amount of business we are now doing in these commodities with other countries the figures are not available at the moment, but when these items come up again in committee on the bill it may be possible to supply my hon. friend with details on some of the more substantial items in the list.


Hugh Alexander Stewart: I am not so much
interested in the business we are doing in these commodities with other countries as I am in knowing whether we produce any of these goods.


William Daum Euler: As a result of this trade agreement the benefit of favoured nation treatment is given to us the same as to these other countries by the United States, and I understood my hon. friend to say that he would like to know what exports we were already making to these other countries.


Hugh Alexander Stewart: No; to the United States.


William Daum Euler: We have not that information at hand.


Ernest Edward Perley: We should like to know whether we produce these commodities in Canada.


William Daum Euler: Some of" them we do.


Abraham Albert Heaps: I notice that the duties on cobalt oxide, cobalt sulphate and many other items are given at so much per pound. The duty on cobalt oxide, for instance, is 10 cents per pound and on cobalt sulphate, 5 cents per pound. But how does that work out as a percentage? What is the value of cobalt

oxide per pound? If we knew that, we would have some idea of what the concession amounts to and of the prospect of obtaining additional trade with the United States, which at least we hope that we shall get.


William Daum Euler: On the basis of 1932 exports the duty on cobalt oxide would be 20 per cent ad valorem.


Abraham Albert Heaps: Do I understand that the value of cobalt oxide is about 50 cents per pound?


William Daum Euler: At that time it was.


[Stage Direction]
Item agreed to.
United States tariff-52. Sperm oil, crude, 2J cents per gallon.
William Daum Euler: 
Ernest Edward Perley: Mr. Chairman, I do not think I object to filling up the record with these figures if the government wish to put them on the record, but I feel sure that we do not have any ipecac exports from this country to the United States, and therefore the reduction cannot be of any advantage to us, although on paper the duty is reduced.


Hugh Alexander Stewart: Yet the duty is cut in half!


Ernest Edward Perley: I know, but we do not produce any ipecac. If the hon. gentleman wishes to put all this on the record, there is, of course, the other side of the picture. We have granted to the United States on many commodities special rates which will automatically be extended to those countries with which we have most favoured nation treaties, and we might as well start and put on the record how it is going to hurt Canada because these special rates are granted to these other countries. I suggest that this is only blocking the work of the committee, but I have no particular objection if there is anything to be gained by it.


William Lyon Mackenzie King: There may be here and there an item such as ipecac, which would fall within what my right hon. friend has just said, but I think he will find that for the most part the items mentioned are those which really affect Canadian production and which certainly we have a potential capacity to produce. I think it would be desirable to have these various concessions on record. It should not take very long unless my hon. friend objects to each of them.


Ernest Edward Perley: I suggest that we should put on record only those items which are going to be of assistance to us.


John Gordon Ross: How can we
tell what will be of assistance? We do not grow cotton in Canada, but we produce a tremendous amount of cotton goods.


William Daum Euler: It is conceivable that because of a reduction in the rate of duty some business might be developed.


[Stage Direction]
Item agreed to.
United States tariff-71. Acetylene black, 15 per cent ad valorem.
William Daum Euler: Fordney-McCumber tariff,
20 per cent; Hawley-Smoot tariff, 20 per cent; trade agreement, 15 per cent. Exports from Canada are not available. I believe this item is included with certain other exports.


[Stage Direction]
Item agreed to.
United States tariff-201(a). Fire brick, not specially provided for, 15 per cent ad valorem.
John Ritchie MacNicol: Is this item manufactured in Canada?


William Daum Euler: In 1929, imports into the
United States from Canada were valued at $44,000, and in 1934, $10,000.


John Ritchie MacNicol: I asked if this was made in Canada.


John Gordon Ross: Have we passed item 71?


Charles-Philippe Beaubien: We are now on item 201 (a).


John Ritchie MacNicol: I am still waiting for an answer to my question.


William Daum Euler: Yes; it is made in Canada.


John Ritchie MacNicol: On Friday last, I asked
the same question of the Minister of Finance, and he replied, as reported on page 1076 of Hansard, as follows:
There is no Canadian production as this is of a class or kind not made in Canada.
I should like to know if that statement is correct.


Charles Avery Dunning: Perhaps my hon. friend
will permit me to defend myself. The statement which he has read referred to an item which had attached to it the words, "of a class or kind not made in Canada."


John Ritchie MacNicol: I have a recollection that I asked the minister if fire brick was made in Canada.


Charles Avery Dunning: There are two fire brick items. The one under discussion at the time my hon. friend asked his question was of a class or kind not made in Canada. There is made in British Columbia some fire brick which would come under this item.


John Gordon Ross: And in Saskatchewan.


John Ritchie MacNicol: I have purchased considerable imported fire brick for the lining of cupolas.


John Gordon Ross: There is a large production of a very good brand of fire brick at Clayburn, British Columbia. In my own constituency south of Moose Jaw is produced a fire brick with the highest fire test of any brick produced anywhere in the world. Next to that brick is the one produced at Clayburn.


Mr. McIVOR:: Fire brick is also produced at Fort William.


John Ritchie MacNicol: If the hon. gentlemen
are referring to fire brick as it is usually
Canada-U. S. Trade Agreement

understood, that is for the lining of cupolas for the melting of iron, I am very glad to have this information. I am glad to hear that there is such an industry in the constituency of the hon. member for Moose Jaw. I hope that when the question of protecting the fire brick industry in Canada comes up again he will defend the fire brick plant in his riding.


John Gordon Ross: I think they are better off with no tariff. I do not think they need it.
Mr, EULER: It might be worth while mentioning that as a result of the favoured nation treaty with Belgium, the duty on white lead entering the United States is reduced from cents per pound to 2-1 cents per pound. This is under item No. 72. LTnder item 205(b), the duty on Roman, Portland and other hydraulic cement or cement clinker, is reduced from 6 cents per hundred pounds to 4^ cents per hundred pounds.


[Stage Direction]
Item agreed to.
United States tariff-203. Lime, hydrated, 8 cents per 100 pounds.
William Lyon Mackenzie King: There are one or two items here. I would point out to the committee that where the countries receiving most favoured treatment are Belgium, the Netherlands and Sweden, the probability is that Canada will be placed in a position, if not at the moment, at least in the near future, to compete in the American market with the products of these countries. As respects items arising out of most favoured nation treatment accorded these northern countries of Europe, it would be advisable to have something on the record. As respects south American republics, such as Brazil and Honduras, there probably are commodities we do not produce, but as respects Belgium, Sweden and the Netherlands the chances are that we shall be able to compete successfully under these new rates. For instance, the duty on sodium phosphate, item 81, has been reduced from 1^ cents per pound to one cent per pound because of the favoured nation treatment given by the United States to Belgium. The duty on potato starch, item S3, has been reduced from 2i cents per pound to 1| cents per pound because of the favoured treatment given to the Netherlands by the United States. The same applies to dextrine made from potato starch or potato flour, item 84, where the duty has been reduced from 3 cents to 2J cents per pound. These items are all included in the schedule, chemicals, oils and paints; the item which we are now discussing is in schedule II,

referring to earths, earthenware and glassware. Here again I think it will be found that Canada will gain many advantages through obtaining the same rates as apply to Belgium, Sweden and the Netherlands.


[Stage Direction]
Item agreed to.
United States tariff-203. Limestone (not suitable for monumental or building stone), crude, or crushed but not pulverized, 2J cents per 100 pounds.
William Daum Euler: Under the Fordney-McCumber tariff, the rate was 5 per cent per hundred pounds; under the Hawley-Smoot, 5 cents per hundred pounds; under the present trade agreement, 2J cents per hundred pounds. In the case of lime, not specially provided for, item 203, the rate under the Fordney-McCumber tariff was 10 cents per hundred pounds; under the Hawley-Smoot, 10 cents per hundred pounds, and under the present agreement, 7 cents per hundred pounds. The rates for hydrated lime were 12 cents per hundred pounds under the Fordney-McCumber; 12 cents per hundred pounds under the Hawley-Smoot, and 8 cents per hundred pounds under the new agreement. Exports from Canada to the United States are not available, but the United States figures for the year 1929 show imports into that country from Canada of limestone, not suitable for monumental or building stone, of $12,000. For 1934 they were valued at $8,000. Lime n.o.p.: Imports into the United States during 1929 were valued at $292,000; during 1934, $74,000. Imports of hydrated lime for 1929 were valued at $92,000; for 1934, $7,000. These concessions ought to be of some value to British Columbia and New Brunswick as both these provinces found the increased duties a handicap to the extension of their sales.


[Stage Direction]
Item agreed to.
United States tariff-207. Crude feldspar, 35 cents per ton.
William Daum Euler: Under the Fordney-Mc-
Cumber tariff this was free, and under the Hawley-Smoot tariff it was $1 per ton. Since January 1, 1932, it has been 50 cents a ton, and under the trade agreement it is 35 cents per ton. Exports from Canada to the United States in 1930 were 28,382 tons valued at $228,631, and in 1935, 8,921 tons valued at $53,779. Imports into the United States from Canada in 1929 were $240,000, and in 1934, $66,000. This ought to be of some interest to the producers of Ontario.


James Earl Lawson: I am sorry but I seem to be hopelessly at sea in connection with this item. Under the tabular statement of tariff

Canada-U. S. Trade Agreement
changes provided by the government we have an item 205 (b), Roman, Portland and other hydraulic cement or cement clinker. The Chairman has omitted that item. Apparently he calls the items from the schedule to the agreement, and what I want to know is where this 205 (b) relates either to 203 or 207. Does that come under the general provision with respect to getting the favoured nation treatment?


Charles Avery Dunning: Because of the agreement of Belgium with the United States we automatically receive the advantages for shipment into the United States.


Hugh Alexander Stewart: Not into Belgium.


Charles Avery Dunning: No.


[Stage Direction]
Item agreed to.
United' States tariff-209. Talc, steatite or soapstone:	ground, washed, powdered or
pulverized (except toilet preparations), valued at not over $12.50 per ton, 25 per cent ad valorem.
William Daum Euler: Under the Fordney-Mc-
Cumber tariff the rate was 25 per cent ad valorem, and under the Hawley-Smoot tariff, 35 per cent ad valorem. Under the present agreement it is 25 per cent. Exports from Canada to the United States in 1930 were 201,571 hundredweight valued at 8118,528, and in 1935,	157,166 hundredweight valued at
881,794. Imports into the United States from Canada in 1929 were S125,000, and in 1934, $84,000.


John Ritchie MacNicol: The item would have been much more valuable to Canada if the words within the brackets "except toilet preparations" were not there, because that would necessitate the application of Canadian labour to the raw product. Under both 209 and 207 it is a matter of shipping out the raw product without having applied Canadian labour to it, apart from the labour involved in the mining and shipping of the raw product.


[Stage Direction]
Item agreed to.
United States tariff-214. Dead-burned basic refractory material containing 6 per cent or more of lime and consisting chiefly of magnesia and lime, 27J per cent ad valorem.
Note.-The existing customs classification treatment of the merchandise described in this_ item as provided for in paragraph 214, Tariff Act of 1930, in accordance with the ruling announced in treasury decision 45041 (60 treasury decisions 114) shall be continued during the effective period of this agreement.
William Daum Euler: The Fordney-McCumber
tariff was 30 per cent ad valorem and the Hawley-Smoot tariff, 30 per cent; under the trade agreement it is 27| per cent. Exports
from Canada are not available. The United States figures, however, are: for 1929, 8200,000, and for 1934, 8167,000. In addition, we come under the favoured nation treaty with the United States, Sweden having reduced the rate on engraved ornamental glassware, valued at over $8, from 60 per cent ad valorem to 30 per cent ad valorem, and on laminated glass composed of layers of glass or other material, from 60 per cent ad valorem to 45 per cent ad valorem, applying to Belgium.


Hugh Alexander Stewart: Does the minister mean
that we get a reduction on exports to Sweden and Belgium?


William Daum Euler: We get the same rate as
those countries do in the United States.


Hugh Alexander Stewart: But only going into the
United States?


William Daum Euler: Yes.


Hugh Alexander Stewart: When the minister says
"to Belgium"-


William Daum Euler: Applying to Belgium.


Hugh Alexander Stewart: As I understand the
minister, his remarks are open to the interpretation that we are getting a privilege on our exports to Belgium.


William Daum Euler: We get that privilege only
where both countries have the favoured nation agreement with the same country; then we are on the same basis as the United States. When I give these reductions it means that we have the same rate as these countries have when they are exporting to the United States.


James Earl Lawson: Has Canada exported to
the United States any quantities of these products under 218 (f) and 220?


William Daum Euler: I have not those figures.


Ernest Edward Perley: It is all right
to let these items pass, and I am content, but I would point out to the Prime Minister that he did not get a 50 per cent reduction.


[Stage Direction]
Item agreed to.
United States tariff-302(d).	Ferromanganese containing not less than 4 per cent of carbon, on the metallic manganese contained therein, | cents per pound, plus lj times the lowest rate of ordinary customs duty provided for manganese ore containing in excess of 10 per cent of metallic manganese the product of any foreign country except Cuba, at the time such ferromanganese is entered, or withdrawn from warehouse, for consumption, but not more than 1J cents per pound.
William Daum Euler: The Fordney-McCumber
tariff was If cents per pound on metallic manganese content, and the Hawley-Smoot

Canada-U. S. Trade Agreement
tariff was 1J cents per pound; under the trade agreement it is | cents per pound plus 1| times the rate of ordinary customs duty provided for manganese ore containing in excess of 10 per cent of metallic manganese the product of any foreign country except Cuba, at the time such ferromanganese is entered or withdrawn from the warehouse for consumption, but not more than 1| cents per pound. Exports from Canada to the United States in 1930 were 37,000 tons, valued at $3,451,000, and in 1935, 25,000 tons, valued at $672,000.


Alexander MacGillivray Young: What is the rate of duty?


William Daum Euler: I gave it. The Hawley-
Smoot tariff was If cents. The present rate is * cents per pound plus 1} times the rate of ordinary customs duty. The computed rate is 1 cent.


Charles Avery Dunning: Both put together are
1 cent; it is from 1| to 1 cent, the effective rate.


[Stage Direction]
Item agreed to.
United States tariff-302 (i). Ferrosilieon, containing 8 per centum or more of silicon and less than 30 per centum, 14 cents per pound on the silicon contained therein.
William Daum Euler: Fordney-McCumber tariff, 2 cents per pound; Hawley-Smoot tariff, 2 cents per pound; trade agreement, 14 cents per pound. Exports from Canada to the United States in 1930, 29,757 tons, valued at $1,082,000; in 1935, 9,412 tons, valued at $242,000.


[Stage Direction]
Item agreed to.
United States tariff-302 (m). Ferro-titanium, ferrovanadium, and ferrouranium, 15 per cent ad valorem.
William Daum Euler: Ferro alloys: Fordney-McCumber tariff, 25 per cent ad valorem; Hawley-Smoot tariff, 25 per cent ad valorem; trade agreement, 15 per cent ad valorem. Exports from Canada to the United States, not available.


[Stage Direction]
Item agreed to.
United States tariff-353. Cooking stoves and ranges, having as an essential feature an electrical heating element, and parts thereof; any of the foregoing, finished or unfinished, wholly or in chief value of metal, and not specially provided for, 25 per cent ad valorem.
William Daum Euler: Some benefits we get under the favoured nation agreement:
Muck bars, pieces thereof except crop ends, bar iron, and round iron in coils or rods, iron in slabs, blooms, loops, or other forms less

finished than iron in bars and more advanced than pig iron, except castings; all the fore; going valued at not above 14 cents per pound.
Formerly 0-3 cents per pound under the old rate, now 0-25 cents per pound, the rate applying to Belgium.
Steel ingots, cogged ingots, blooms and slabs, by whatever process made; billets and bars, whether solid or hollow, weighing more than 30 pounds per linear foot: valued at not above 1J cents per pound.
Formerly 0-3 cents per pound, becomes 0-25 cents per pound, the rate applying to Belgium. Valued above 14 cents and not above 24 cents per pound, from 0-5 cents per pound, the old rate, to 0-375 cents per pound, Belgium.
Billets and bars, whether solid or hollow, weighing not more than 30 pounds per linear foot, and concrete reinforcement bars: valued at not above 14 cents per pound.
The old rate was 0-3 cents per pound, reduced to 0-25 per pound, Belgium. Valued above 14 cents and not above 24 cents per pound. Old rate, 0-3 cents per pound reduced to 0-4 cents per pound, Belgium.
Unfinished steel, steel bars, sheets and slabs valued at 24 to 8 cents per pound.
Formerly 0-8, 1-0, and 1-7 cents per pound, reduced to 20 cents per cent ad valorem, the rate applying to Sweden.
Die blocks or blanks; shafting; pressed, sheared, or stamped shapes, not advanced in value or condition by any process or operation subsequent to the process of stamping; hamper moulds or swaged steel; gun-barrel moulds not in bars; all descriptions and shapes of dry sand, loam, or iron moulded steel castings; sheets and plates and steel not specially provided for; all the foregoing: valued at not above 14 cents per pound.
Reduced from 0-3 cents per pound to 0-25 cents per pound, Belgium; or valued above 14 and not above 24 cents per pound, from 0-5 cents per pound, old rate, to 0-4 cents per pound, Belgium.


John Ritchie MacNicol: Is the minister referring to 302 (m)?


William Daum Euler: No; I am referring to the items on which we get preference by reason of the favoured nation agreement that the United States has with the countries that are specified here. For instance:
Alloy steels valued over 34 and' not over 8 cents per pound.
From 8 per cent ad valorem to 4 per cent additional duty on the total value of the alloy steel plus present specific rates on alloy contents, Sweden.
Boiler or other plate iron or steel, except crucible plate steel and saw plate steel, not

thinner than 109/1000ths of 1 inch, cut or sheared to shape or otherwise, or unsheared, and skelp iron or steel sheared or rolled in grooves, valued at not above 3 cents per pound.
From 0-5 cents per pound, old rate, to 0-35 cents per pound, new rate, Belgium.
Sheets of iron or steel, common or black, of whatever dimensions, and skelp iron or steel, valued at 3 cents per pound or less.
They vary: 0-45 cents per pound reduced to 0-35 cents per pound, Belgium. There are other reductions under that item.
Beams, girders, joists, angles, channels, car-truck channels, tees, columns and posts, or parts sections of columns and posts, and deck and bulb beams, together with all other structural shapes of iron or steel; any of the foregoing machined, drilled, punched, assembled, fitted, fabricated for use, or otherwise advanced beyond hammering, rolling, or casting.
Formerly 20 per cent ad valorem, reduced to 15 per cent ad valorem, Belgium.


Mr. STIRLING:: Does Canada ship much of that?


William Lyon Mackenzie King: She will,
shortly.


William Daum Euler: We hope that we shall.
Hoop or band iron, and hoop or band steel, cut to lengths, or wholly or partly manufactured into hoops or ties, coated or not coated with paint or any other preparation, with or without buckles, or fastenings, for bailing cotton or any other commodity.
From 0-25 cents to 0-2 cents per pound, Belgium.
Wire rods: rivet, screw, fence, and other iron or steel wire rods, whether round, oval, or square, or in any other shape, nail rods and fiat rods up to 6 inches in width ready to be drawn or rolled into wire or strips, all the foregoing in coils or otherwise, valued at not over 2J cents per pound.
From 0-3 cents per pound to 0-25 cents per pound, Belgium.
Wire rods: valued over 2J and not over 4 cents per pound, from 0-3 cents per pound to 0-3 cents per pound; valued over 4 cents per pound, from 0-6 cents per pound to 0-6 cents per pound.
That is bound against increases.


Ernest Edward Perley: I do not want
to raise a point of order, but I wonder if these figures are germane to this item under discussion. The Minister of Finance has tried to keep the discussion within bounds.
I hope the Minister of Trade and Commerce will do the same thing. I do not think these figures have anything to do with the item under discussion.


William Daum Euler: I do not think there is any
point of order so far as that is concerned,
Canada-U. S. Trade Agreement
and I believe my hon. friend will admit that we are apt to be criticized, and have been criticized, for not having received as much as we were giving to the United States.


John Ritchie MacNicol: You are certainly receiving little in this.	.


William Daum Euler: And we are trying to show
that by virtue of favoured nation agreements the United States has with other countries we are getting the benefit of those agreements. We are trying to show in what particulars we obtain these benefits. I think that ought to be of great interest to the committee. I admit that the figures may be a bit dry, but the material will be available on some future occasion.


Ernest Edward Perley: I think I would agree with my hon. friend if he could show that we manufacture these commodities and will get some advantage out of the arrangement, but I cannot see the object of simply reading a lot of figures without having anything to show that we manufacture these articles, or that we export them, or that they will be of any benefit to us.


Mr. ROWE (Dufferin):: I rather agree
with the minister. I think it is interesting to know what advantages we secure under the agreement, and I think that in order to see the value of those advantages he might, on each of the items, give us the amount of exports. He says that they are not listed. If they are not listed and we are not exporting any, I agree with the hon. member for Argenteuil (Sir George Perley) that it is merely a waste of time to talk about duties on articles of which we do not export any.
I think the minister might have given us the amount of exports together with the lists. It reminded me of the famous Dunning budget, in which the minister promised to give reductions on such items-


Charles Avery Dunning: And we did.


Percy John Rowe: -as cut flowers, cast iron pipes, steam engines and pressed hay and pressed straw, to the old country.
I remember we had a list of commodities like onions and presesd hay, baled hay, alfalfa- hay., all those commodities in which we could have no trade with the old land, none was shipped.


Charles Avery Dunning: I should think, after the budgets the hon. member (Mr. Rowe) has had a part in preparing since 1930, he would for ever keep quiet about the Dunning budget.

Canada-U. S. Trade Agreement


Percy John Rowe: I have been waiting ever since for a countervailing system.


William Daum Euler: I will try to be as merciful as possible. A number of figures have been read. There are one or two others, and I think it would be rather regrettable if we did not make the' record complete now that we have started it.


Percy John Rowe: Will the minister add the exports?


William Daum Euler: I would give those figures if they were available. In some instances they may be available; in others it may be quite true that there are no substantial exports, but at the same time we are getting the benefit of decreased tariffs and it may be that we shall develop trade in these commodities in the years to come.


Percy John Rowe: My hon. friend is an ex-Minister of National Revenue, and for the sake of information I should like to ask if we have not tabulated records of exports. When we have no records of exports is it not an admission that there is practically none?


William Daum Euler: Classifications do not always agree. In any case the figures are not available. The other items are:
Round wire, valued over 6 cents per pound, 25 per cent ad valorem.
That has been reduced to 20 per cent ad valorem, and the country is Sweden.
Flat wire and steel strips: not exceeding 1/100 inch in thickness, 25 per cent ad valorem, from 1/100 to 1/500 inch in thickness, 25 per cent ad valorem.
In the first instance that has been reduced to 15 per cent ad valorem and, in the second, to 20 per cent ad valorem, and in each case the country is Sweden.
Anti-friction ball and roller bearings, 10 cents per pound plus 45 per cent ad valorem.
This has been reduced to 8 cents per pound and 35 per cent ad valorem, and again the country is Sweden. The next item is anvils, and I suppose some of the knockers will be interested in this.
Anvils weighing over five pounds, 3 cents per pound.
This has been reduced to 2 cents per pound, and the country is Sweden.
Enamelled ware, household utensils, 5 cents per pound plus 30 per cent ad valorem.
This has been reduced to 5 cents per pound plus 15 per cent ad valorem, and the country is Sweden.
Crosscut, hand, buck, and saws not specially provided for, valued over 5 cents each, 20 per cent ad valorem.

This has been reduced to 15 per cent ad valorem, and the country is Sweden.
Mill, pit. drag and steel band saws, 20 per cent ad valorem.
This has been reduced to 12 per cent ad valorem, and the country is Sweden.


John Ritchie MacNicol: I want to say a word
or two before the item carries. I enjoyed the minister's good-natured and good-humoured way of presenting these facts. It made me think the minister felt that he was putting over something really good, all the time knowing it was not worth much to Canada. I have no intention of holding up this item, or of speaking to it at any length, but a number of us know something about this line of material. The minister mentioned boiler plate. This country has been a very large importer of boiler plate; after long efforts at last we have been able to make some of it in Canada, but the minister knows perfectly well that it is not possible to export boiler plate in any considerable quantity. If we try to do so we would be up against the competition of the Belgian cartel in Europe and the United States in America. The minister also mentioned channels, and I assume that included the Z and U shaped beams and beams themselves. We are importers of all that line of material now if the duty is low enough to enable it to come in here. To export that material is considerable quantities is simply out of the question. So, as far as I can see this is an all but empty item as far as benefit to Canada is concerned.
I was amused when the minister mentioned anvils. If he were referring to item 431b, the question of anvils and kindred lines of material is very interesting, because our tariff on that line of goods is quite high. It is not too high to suit- me, however, because this industry provides employment to Canadians in Brockville and also St. Catharines. I believe. I said last night I was glad that item had not been interfered with. I do not suppose there was any politics in the matter; the fact that three of the principal directors are Senator Graham, Mr. George P. Fulford and Mr. Gordon C. Edwards would not. I assume, be any reason whatever for leaving that item undisturbed.
The minister also mentioned bars used for the erection of concrete buildings. He knows we do not export that line of material in any quantity, and he also knows we could not manufacture it in Canada if the duties were materially lowered. I know of only one or two plants that make it; they are real, substantial plants, but as far as exporting it goes we are simply not doing it in any quantity worth while. So for my part I do not want

Civil Service Act
to think the minister is trying to put anything over in regard to Canada being able to export in quantities all that line of material he enumerated, in competition with Belgium and United States steel makers.


Charles-Philippe Beaubien: Shall
the item carry?


Percy John Rowe: No, Mr. Chairman; call it six o'clock.
At six o'clock the Speaker resumed the chair and the house took recess.
After Recess
The house resumed at eight o'clock.



COPYRIGHT ACT

[Stage Direction]
On the order:
Resuming the adjourned debate on the motion of Mr. Esling for the second reading of Bill No. 7, to amend the Copyright Amendment Act, 1931.
Louis Édouard Fernand Rinfret: Mr. Speaker, I understand this is to stand further, in agreement with the mover of the bill. I would like, however, to take this occasion to remind the house that according to the departmental order based upon the amendment adopted by this house in 1935 and extended since, no litigation for infring-ment of copyright can be entered into by the Canadian Performing Right Society or any other such society until the end of April of this year, and if necessary this provision will be further extended until the new legislation is in force. I make this declaration in order to reassure the mover of the bill and those interested in it that the delay in introducing the government bill can bring no harm to any one.


Walter Edward Foster: Stands.



CIVIL SERVICE ACT

[Stage Direction]
The house resumed, from Tuesday, March 10, consideration of the motion of Mr. Boulanger for the second reading of Bill No. 9, to amend the Civil Service Act (vacancies, outside service, priority to returned soldiers).
Mr. J. S. WOODSWORTH (Winnipeg North Centre):: Mr. Speaker, When this bill was last under discussion I was pointing out that the government could not escape responsibility for this measure. It is true that it is a private bill, but the government, speaking through the Secretary of State (Mr. Rinfret), has seen fit to try to advance this bill, suggesting that it should be allowed to pass second
reading and go to a committee. Year after year we have had commissions and committees of this house and of the senate dealing with the Civil Service Act. Now it would seem as if an attempt is being made to introduce fundamental changes in the act by a sort of back-door method. If the government want to change the Civil Service Act I suggest that they should bring about that change in a recognized way, themselves definitely taking the responsibility of bringing forward a bill, or perhaps themselves setting up a committee to go once more into the question. But I do object to a private member introducing a bill of this kind, having such far-reaching effects, and the house being expected to pass it through on second reading, that is to give assent to the principle underlying the bill. I would appeal to the Prime Minister (Mr. Mackenzie King) himself, if he were in his seat, himself a former civil servant, that he should not in any way countenance the passing of a bill of this sort. I could not but think of those brave words that the Prime Minister uttered on the night of the election, and that he repeated in the house in one of his first speeches this session.
To-day's victory is a victory for democracy.
Is that going to be watered down to mean that a Liberal victory was simply a victory for reaction and the setting aside of the Civil Service Act, which has been in existence for so long, and introducing once more the patronage system? He said further:
It constitutes a great deliverance; a deliverance of the people from one-man government, irom mistaken policies, and from autocratic leadership. It is a triumph for broad principles and policies, as against promises and pledges recklessly and extravagantly made for the sole purpose of winning an election.
Brave words these; yet within a few months after they were uttered; within a few weeks after the opening of this parliament, we have the Liberal party with all its liberal traditions asking this house to further a measure which is essentially a return to patronage.
In that notable speech the Prime Minister further said:
It is clear evidence of the desire of the people of Canada to maintain high standards in Canadian public life, and to enjoy a tone in the discussion of public affairs wholly different from that to which, both in and out of parliament, they have became accustomed during the past five years.


Mr. JOHNSTON (Lake Centre):: On a point of order, Mr. Speaker, I think the hon. gentleman is certainly out of order in quoting from a previous debate in the present session.

Civil Service Act


Walter Edward Foster: I think the point taken by the hon. member for Lake Centre is quite in order. I do not think the hon. member has a right to quote from a previous debate. I refer to Beauchesne's Parliamentary Rules and Forms, page 95, Standing Order 41:
...a member, while speaking, must not: _
(a) refer to any debate of the same session on any question not then under discussion.
Besides being set down in the standing order the rule has been sanctioned by usage in both England and Canada, that an hon. member while speaking must not refer to any debate of the same session on any question not then under discussion.


James Shaver Woodsworth: I point out that I am referring to a public speech made by the Prime Minister on the night of the election.


Walter Edward Foster: But it was incorporated in a debate in the house.


James Shaver Woodsworth: If the Prime Minister undertakes in the course of a debate to quote from the Bible surely that does not mean that we are forever precluded during the rest of the session from quoting the Bible in this assembly.


Walter Edward Foster: Order.


James Shaver Woodsworth: I suggest that I am quite in order in quoting from a speech of the Prime Minister made outside this house.


Some hon. MEMBERS:: Go ahead.


James Shaver Woodsworth: I think the Prime Minister would not deny me that right.


John Frederick Johnston: The rule is very clear; it is distinctly stated that it is not in order to quote from a previous debate in the same session, and that is what the hon. gentleman is now attempting to do.


Walter Edward Foster: I think the hon. member should abide by the rules and the decision I have given.


James Shaver Woodsworth: I am abiding by the rules of this house, but I submit that the rules do not prevent my quoting from a speech made by the Prime Minister outside this house on October 14, last.


John Frederick Johnston: The hon. gentleman is quoting from Hansard the report of a previous debate in the present session.


Mr. CHEVRIER (Ottawa):: I do not know that I am in order in speaking after Your Honour has rendered a decision, but the rules of the house are clear that hon. members may not quote from a previous debate. The

hon. member now has Hansard of this session and he is quoting from a previous debate during this session. The hon. gentleman is not quoting from a speech delivered outside the house; he is quoting from the Hansard report of the Prime Minister's speech made during this session.


Walter Edward Foster: Does the hon. member appeal from the ruling? I thought I had rendered my decision.


James Shaver Woodsworth: I am not going to take the time of the house to challenge Your Honour's ruling, but I protest against it.


Walter Edward Foster: Order. I rendered my decision, which is in accordance with decisions rendered in many other cases.


James Shaver Woodsworth: I say that I am not going to challenge Your Honour's ruling; all I want to do is to protest against it.


An hon. MEMBER:: The hon. member will be named.


James Shaver Woodsworth: Well, then I will be named. The hon. member is not going to frighten me by suggesting that. If this Liberal government is going to expel a member for quoting from a speech made outside this house, then I am quite willing to walk out.


Louis Édouard Fernand Rinfret: I desire in the name of the government to say that the government have taken no part in this little discussion.


James Shaver Woodsworth: I hope the government are not siding with the Speaker in this instance in preventing the quotation from a speech made outside the house.


Some hon. MEMBERS:: Order.


Louis Édouard Fernand Rinfret: Mr. Speaker having given his ruling, I am precluded from giving my own opinion, but I desire to say again that the government have taken no part in the discussion of this point of order.


Mr. CASSELMAN:: The government assume responsibility.


James Shaver Woodsworth: I suppose I ought not to express appreciation of the government's action in this regard.


Louis Édouard Fernand Rinfret: You are not far from the truth in doing so.


James Shaver Woodsworth: Coming back to the question of the civil service, I said that I was appealing to the Prime Minister and the Liberal government to live up to the ideals that have been set before us as the ideals of Liberalism. I would appeal to some of the members of the government. I spoke the other night with regard to the Minister of

Civil Service Act
Immigration (Mr. Crerar) who, if I remember aright, came down here many years ago pledged to the ideal of a civil service commission rather than patronage. I would appeal to the Postmaster General (Mr. Elliott) whether he approves a return to patronage. I would appeal to the Minister of Trade and Commerce (Mr. Euler), whom I have known in this house for a good many years. I would appeal to some of the newer members of the cabinet, to the Minister of National Revenue (Mr. Ilsley) and the Minister of Labour (Mr. Rogers), who do not happen to be in their seats at the moment. I can hardly conceive that they will sanction a retrograde measure of this kind. We are told that we must have cabinet solidarity, but I cannot believe that the cabinet is united in a desire to advance a measure of this sort. I would appeal also to the western members. Did they come down to this house pledged to anything of a patronage nature? I would remind the Liberals that although they are here in such large numbers their victory was not quite so sweeping as one might imagine. In 1930 the Liberals polled 46.2 per cent of the total vote, and in 1935 they polled only 46.8 per cent of the whole vote. So it was not a very sweeping victory when you put it in that way.
Mr. CHEyRIER (Ottawa):	What has
that to do with the bill under discussion?


James Shaver Woodsworth: I warn the Liberals-


Lionel Chevrier: Warn yourself.


Mr. WOODSW ORTH:: I warn the Liberals that if they put through measures of this kind the whole country west of the lakes is going to revolt.
I would point out to the new members on the other side of the house that although the gov eminent, speaking through the Secretary of State, seems willing to advance this bill, it is really a private measure. I know that the older members recognize this; that my hon. friend from New Westminster (Mr. Reid) recognizes it very clearly, but there are some who perhaps may not realize that the defeat of this bill does not mean the defeat of the government, and the newer members should not be deceived into thinking that they are going to defeat the government by defeating this bill. This is a private bill-let that be remembered. Yesterday we had the spectacle in the house of the Prime Minister telling the members that they must not vote for an amendment that would mean a lower tariff on agricultural implements. Whether he was justified in doing that, I submit that that procedure is not warranted with regard to a bill of this kind. There can be no threat
12739-76}
held by the Prime Minister or any member of the government over private members for standing up for what I think a great many of them really believe, and for what I know a great many of their constituents really believe.


Mr. LAPOINTE (Quebec East):: Nobody says otherwise.


James Shaver Woodsworth: A great many are saying otherwise.


Ernest Lapointe: Why this violent outburst?
Mr. W'OODSWORTH: I say that the government, speaking through the Secretary of State, asked us to pass the second reading of this bill.


Louis Édouard Fernand Rinfret: I made it very plain that I did not want to commit the house to the bill, but that the bill might go to a committee for study purposes. I said that I stood by the merit system.


James Shaver Woodsworth: Not even the Secretary of State can alter the fundamental rules of this house, and one of its fundamental rules is that the principle of a bill is decided on its second reading. We are deciding that principle now, and not even the Secretary of State can set that rule aside. If we approve the principle of this bill by voting for its second reading for study purposes or for any other plausible reason we are advancing the bill by one stage. I would say -to the Minister of Justice (Mr. Lapointe) what I said before he came in, that the government cannot escape responsibility for advocating a. measure of this kind.


Ernest Lapointe: The government does not advocate the measure.


James Shaver Woodsworth: Does the government speak through the Secretary of State?


Ernest Lapointe: Even the Secretary of State has a right to make a, suggestion to the house.


James Shaver Woodsworth: But surely he
makes it as a member of the government.


Ernest Lapointe: My hon. friend breaks into an outburst which is absolutely unnecessary and unjustified.


James Shaver Woodsworth: Anything the Secretary of State suggests, he suggests as a member of the government, and the government is to that extent helping to advance this bill.
I would ask, Mr. Speaker, whether, alter all, patronage is such a great party asset. Members on the government side are pestered to
Civil Service Act

death by job hunters, and I need not remind them of what they know only too well, that for every man who gets a job through patronage ten men are disappointed. To-day there are not enough jobs to go round.


Mr. REID:: We know that.


James Shaver Woodsworth: Why seek to extend the area of patronage under those circumstances? Perhaps I might give away a little secret. I myself have always thought that one of the reasons, among others, why I have been elected was that I do not control any patronage. I do not think it is an asset to a member that he is able to give out a few odd jobs.
Patronage, I take it, is nothing less than a national vice; it is thinly veiled bribery. The social credit people to my left have sometimes been charged with offering a twenty-five dollars a month bribe. Be that as it may, what about the practice of taking care of one's political friends at the public expense? In China what is known as "squeeze" is held largely responsible for the weaknesses of a great nation. Are we to introduce something of the same kind here in Canada, and extend it right and left? Make no mistake, this bill is a return to patronage on a large scale, and anyone who seeks to advance this bill a further stage is in my judgment lending himself to a return to patronage.
What sort of efficiency, may I ask, is to be expected in the public service if there is no security at all and if there is no certitude that merit will be rewarded? What sort of efficiency can we expect if the idea prevails that a man's advancement will depend upon the whim of his political superior? It is bad enough that we cannot have even a barber in the House of Commons unless he is on the right side politically. Even the Free Press a few weeks ago had quite a satire on that. One has to be a Liberal, forsooth, nowadays in order to be a barber in the House of Commons, and yet the barber has to deal faithfully with every man who sits in his chair, be he a Liberal or a Conservative. That may be all very well, if you like, for barbers or messengers, but what about people occupying responsible positions? We have large numbers of scientists and other professional men occupying high positions in this country. Are we to say to men in the [DOT]outside service that they must be of the right political colour, wear a certain political badge, in order to be promoted? Are we going to say to those of a similar class outside that they cannot even be appointed to the civil service unless they are of the right political colour? If that is the case, I think it is indeed a deplorable situation. We are trying to teach

our boys in school that if they work hard and faithfully at their tasks they are fairly well assured of being able to get on in the world. But if measures of this kind are to become the law, I suggest that we shall have to alter that kind of teaching and tell them that they will have to do a lot of bootlicking, wear political badges and be subservient and then possibly they may get advancement in the public service. Is that the position we are coming to in Canada?
I remember several years ago, long before I entered parliament, going in to see the head of a department of one of the provincial governments, a man whom I had known for some years. He called me into his office. He had rather an important position, and I congratulated him upon it. He looked through the glass doors out over a great room filled with clerks. "Well," he said, "Mr. Woodsworth, I am not quite so sure about it. What can I do with a staff like that? Almost every day," he said, "the minister or somebody else sends a letter down to me, asking if I can make room for so and so, and I have to try and make room for him. I have undoubtedly," he said, "a great task and a great opportunity, but I am handicapped in having continually loaded upon me people who are not efficient."


Mr. VIEN:: Where was that?


James Shaver Woodsworth: In a department of one of the provincial governments. It happened some years ago.


Mr. DONNELLY:: In what province?


James Shaver Woodsworth: It is immaterial. The hon. gentleman will not doubt my word. I have used that simply as an illustration. My friend said that it was almost impossible for him to obtain efficiency in that department so long as he was handicapped by patronage of that kind. I suggest here to-night that we cannot very well hope to have efficiency in our civil service if we return to patronage of this sort.
Let me read a section of this bill which really contains the principle:
The outside service shall be excluded from the operation of this act, and the governor in council may make regulations for the control and direction, organization, classification and compensation, appointments to and general conditions of the outside service.
As I stated before, if the outside service is to be taken out from under the Civil Service Act, there is no reason why the same treatment should not be accorded to the inside service. When I made that statement the other evening the mover of this bill said,

Civil Service Act
"Hear, hear." He is in sympathy with that idea. In his judgment this is simply a forerunner of more "advanced" legislation along this line; I should put it rather more "retrograde" legislation. The present act contains this section in connection with promotions:
Promotion is a change from one class to another class with a higher maximum compensation, and vacancies shall be filled, as far as is consistent with the best interests of the civil service, by promotion.
There is no such principle contained in this bill. The section continues:
Promotions shall be made for merit by the commission upon such examination, reports, tests, records, ratings or recommendations as the commission may by regulation prescribe.
There is nothing in this bill to suggest that that principle is to be applied. The matter is to be left entirely to the discretion of the minister in charge. I am quite willing to admit, as I did the other evening, that there may be some room for improvement in the Civil Service Act and in the procedure by which appointments and promotions are made. If that is so, let the government introduce suitable legislation at this session and we will support to the utmost the changes necessary to make our civil service efficient. It is not necessary to-night to quote the members of the government against themselves. I plead with them that they refuse to consider the advancing of a retrograde measure of this kind.


Daniel (Dan) McIvor: Mr. Speaker, I congratulate the leader of the Cooperative Commonwealth Federation (Mr. Woodsworth) upon the splendid St. Patrick's day speech which he has just made. I would remind him that when a man talks loudly, as he has done, there is generally a fight in sight. I congratulate him upon the way in which he is celebrating St. Patrick's day. I agree with him in some respects, but I would remind hon. members on this side of the house that all the reformers are not to be found on one side of the chamber. I congratulate the introducer of this bill (Mr. Boulanger), because I think its introduction will lead to some reforms. It is stated that certain abuses have cropped up in the civil service. While I cannot say that I have actually seen any in my dealings with the service, I must say that I have seen signs of abuse. I do not think examinations should be held when a charwoman or cleaner is to be appointed to the public service. I think it is asking the examiners to do an impossible task when you ask them to pick out one woman from many who will make a better sweeper than the rest. I do not think
our civil service should have to stoop to that sort of thing, but I think it should aim to be more like the imperial civil service. To my mind that service is far above anything we have on this continent.
The intention of this bill is to give preference to the Canadian returned men. The Canadian returned soldier thinks that a man who left our shores to fight under the Canadian and British flags should have a preference over the man who fought for some other country. I believe the government would be well advised to take this feature of the bill into consideration. I do not want it thought that I am in any way advocating war, because I am utterly opposed to war. I do not think the civil service should be confined to Ottawa. Ottawa is a great city and there are many fine people residing here, but to me it will have to take second place to Fort William. I think the superintendent of a post office in another city should rate the same as a postmaster in Ottawa. I was going to say the same as the Postmaster General, but perhaps that would be asking too much. These superintendents should have equal rights and protection.
I believe that the government, no matter what party may be in power, should get as far away from patronage as is possible. To me patronage is the curse of politics today and the less we have of it, the better we will be. You cannot free yourself entirely from patronage until you get absolute honesty and unselfishness and I have as yet seen no signs of these qualities in any party in this house. Until you have absolute honesty, unselfishness and love, patronage will creep into the service, as it is creeping into even the civil service.


Mr. J. T. THORSON (Selkirk):: Mr. Speaker, surely this is a measure that can be discussed in this house with calmness. I must say that I was surprised at the suggestion made the other evening by the Secretary of State (Mr. Rinfret) that this bill should be given its second reading. It is quite true that he made it perfectly clear that he made this suggestion in order that the bill might be studied in committee. I am quite certain that the government is not behind this bill, but when a bill receives second reading it means that its principle is endorsed by the house. I think the Secretary of State erred in making the suggestion which he did, for he cannot alter the well recognized rule that second reading carries with it the endorsement of the bill. That being so, I am certainly opposed to the second reading of this bill. I have great
Civil Service Act

respect and admiration, for the hon. member for Bellechasse (Mr. Boulanger). I enjoyed the clever and charming manner in which he presented this bill to the house. He elaborated those sections of his bill which commended themselves generally to the house and he said as little as possible about those sections that did not.


Mr. POULIOT:: He is a lawyer.


Joseph Thorarinn Thorson: And a very good one.
While I approve entirely of the hon. member for Bellechasse in his private capacity, I do not approve the bill he is proposing to this house. Why should we send this bill to a committee? The passing of the bill on second reading endorses the principle of it, and if we are opposed to the principle we ought not to give the bill second reading.
Admittedly there are many defects in our civil service system and there are many respects in which the Civil Service Act ought to be amended. Indeed, I have heard it suggested -and I believe there is some truth in the suggestion-that the Civil Service Act when it was adopted in 1920 had rather peculiar and disastrous consequences. Prior to the passing of the act in 1920 the Tory government then in power had filled the civil service with Tory appointments, and then they passed the Civil Service Act which had the effect of clamping the act on the service as it then was, so that the civil service was made a self-perpetuating Tory machine, if a machine may be termed self-perpetuating.
The key to the civil service system is the rating board, and succeeding governments, one after another, have tried to obtain control of the key positions in the service, so that they might use these key positions for their own particular purposes, in view of the fact that the rating board is really the heart of the civil service system. If the rating board is fairly constituted and if the chairman of the rating board is a fair-minded man, no one can take any objection to the board or the appointments that are made. But if the chairman of the rating board is partisan and if the rating board is a partisan body, then we do not have a merit system, for if the chairman of the rating board is partisan and not a fair-minded man. he is anxious to see that the person whom ne favours from a political point of view rates at the top of the list. Then the rating board forwards its report which is dealt with by the authorities of the commission at Ottawa. Surely an effort should be made throughout the system to find proper men in the various departments to constitute these
(Mr. Thorson.l
rating boards and to select, when we do select men for key positions in the service, fair-minded men who will make their recommendations upon a real basis of merit and not upon any partisan basis as is frequently the case under the system as it exists to-day.
I would have no serious objection to the whole Civil Service Act being sent to a committee for investigation and study, both of the act itself and of the entire system, with a view not to weakening the act or to weakening the system, but to strengthening the system by studying the defects of the act. There are a number of serious defects in the Civil Service Act, but there is one in particular which I should like to bring to the attention of the house. There is in the act no provision at all for reinstatement of employees who have been dismissed from the civil service. It matters not that they have been wrongfully dismissed; it matters not that they have been dismissed in error, no provision is contained in the Civil Service Act for the reinstatement of employees in the civil service who have been forced to leave that service either through injustice or in error. The provisions with regard to reinstatement were deliberately left out of the act so that governments might use that as an excuse for not putting men back into the service even though they had been improperly dismissed. I have known cases where men have been improperly dismissed, but when it was desired to remedy the injustice it was found that these men could not enter the service, on the ground that they had exceeded the age limit and were therefore no longer eligible to enter the service, or if they wanted to get back into the service, they had to start at the beginning; they could not return to the service in the positions where they had left off or at the rating they had when dismissed. That is unfair; that is unsound; and if it is proposed to improve the Civil Service Act and to amend it in respects that require amendment, it would be much better to give some thought and attention to those respects in which the act is defective and requires amendment than to destroy those portions of the act which, while not perfect, have yet brought about a better state of affairs than existed previously. I would strongly urge that those who are giving thought and attention to our civil service should take this matter in hand with a view to correcting a very serious defect in the Civil Service Act.
The bill we have before us is interesting and the explanatory notes are also quite interesting. Some of the sections are given at great length while others are drafted in a very clever manner. The explanatory notes

Civil Service Act
also appear in length in respect of certain clauses of the bill while they are very brief in respect of other clauses. The draftsman of the bill is to be commended for the skill which he showed in his work.
Section 3 of the bill deals with the preference to persons on the list of pensioners; it relates to preferences to persons who served in the war. I might be in favour of certain clauses of this bill and I might quite well be in favour of this particular clause that gives a preference to Canadian soldiers who were domiciled in Canada prior to their enlistment. Section 3 of the bill reads as follows:
3. Subsection four of section twenty-nine of the said act is repealed, and the following is substituted therefor:-[DOT]
(4) In all examinations for entrance into the civil service the persons named on such special list who are found to possess the necessary qualifications shall be named, in the order of merit, on the list of successful candidates above all other candidates; and all other persons who have been on active service overseas on the military forces or who have served in the naval forces of His Majesty during the war, who had their domicile in Canada when they enlisted, and who, at the date of the coming into force of this act, have left such service with an honourable record or who have been honourably discharged, or when any persons who have served as aforesaid have died owing to such service, the widows of such persons, and who, in either case, obtain sufficient marks to pass such examinations, shall, irrespective of the marks they have obtained, be named in the order of merit on the list of successful candidates, next after any candidates who are on the special list mentioned in subsection two of this section and above all other candidates.
That section has some merit. It might be difficult to distinguish between those soldiers who were domiciled in Canada at the time of their enlistment and those who were not domiciled in Canada at that time, by virtue of the legal difficulties which might be involved in determining what constitutes domicile and when that domicile has been acquired.
I am opposed to section 5 of the bill, relating to promotions, and I am opposed to section 6 of the bill, relating to dismissals. I do not think we ought to encourage dismissals of civil servants by ministers, particularly when the Civil Service Act contains no provision for reinstatement of persons who have been dismissed. We may, by encouraging such dismissals, do even more injustices than have been done in the past. And I am heartily opposed to section 7 of the bill, which proposes that positions in the outside service shall be excluded from the operation of the act. The proposed subsection that is to be inserted in the new bill reads as follows:
63. The outside service shall be excluded from the operation of this act, and the
governor in council may make regulations for the control and direction, organization, classification and compensation, appointments to and general conditions of the outside service.
That means that in respect of the whole civil service outside Ottawa the Civil Service Act is scrapped, and that is a return to patronage in the whole of the outside service without any qualification whatsoever. To that I am absolutely opposed, and I am quite certain that the government does not favour any such action. I am quite certain that the Prime Minister (Mr. Mackenzie King) is not in favour of any return to patronage in respect of the outside service. Why should we return to patronage? It is a reversion to a system from which we tried to escape when we began the effort to establish a proper civil service system in this country. Admittedly that system is imperfect. Admittedly we have not as yet reached the stage when we can say that it is a merit system. But surely the course we ought to follow in this matter is to remedy as much as possible the defects in our service and to reach our objective as soon as we can, rather than to destroy what has been accomplished and revert to a system which would be much worse than the imperfect system which we now have.
I do not think for a moment that control of patronage has any particular value, even to the member who controls the patronage. We as private members have a great many things to do; we have a tremendous volume of correspondence to attend to, and we are not qualified as other persons may be to make the most suitable selections for positions in the civil service. I think we should encourage improvements in the civil service rather than seek to destroy it, and we would be destroying it in respect of that whole portion outside Ottawa if we were to pass section 7 of this bill. The country does not desire any return to the patronage system; it would not improve the service of Canada. It would not help a single member to be re-elected. Look at the record of the last administration in respect to dismissals-


Harry James Barber: You are doing pretty well this time.


Joseph Thorarinn Thorson: -particularly in certain
parts of Canada: seven hundred dismissals under one particular classification of the service. Where are the forty members from Quebec who were responsible for those dismissals? Are many of them back in this house? Did control of patronage help them?


Jean-François Pouliot: Did their leader help
them?	'
Civil Service Act


Joseph Thorarinn Thorson: It did not help a single one of them. It is true that the right hon. the leader of the opposition (Mr. Bennett) had something to do with the defeat of those members, but the point I wish to make is that the control of patronage did not help them to stem the tide of defeat. Patronage does not help a member; it does not help the service, and the public do not want it. Why, then, send this measure to a committee? I do not favour the suggestion made by the Secretary of State (Mr. Rinfret). I believe he made it in good faith, for he made it plain to every member of the house that he was not committing the members to the adoption of the principle underlying this bill. But I think the suggestion he made was not in order. If it had been intended to send this bill to a committee an amendment should have been proposed to the bill so that it might go to committee without getting second reading and without in any way carrying an endorsement of the principle of the bill.


Louis Édouard Fernand Rinfret: There is a rule in this
house which precludes the sending of a bill to a committee before the measure has received its second reading.


Joseph Thorarinn Thorson: I think it has been pretty generally recognized that the second reading of a bill commits the house to the principle of the measure. I do not know whether steps could be taken to dispose of the questions involved in this bill other than by sending it to a committee, but according to the best practice as I understand it, second reading involves recognition and approval of the principle of the bill, and I for one, having regard' to my opposition to the basic principle of this bill, certainly do not intend to support it on its second reading.


Mr. W. R. TOMLINSON (Bruce):: Mr. Speaker, I rise to speak in this house for the first time on this bill to amend the Civil Service Act. I listened very intently to the right hon. leader of the opposition (Mr. Bennett) the other night when he put forth such a wonderful effort in defence of that act. He did his utmost to convince me that during the term of office of his government the principles underlying that act were upheld to the full. That was what he wished to convey to my mind. I go back to 1918, when the act was first amended to include the outside service, and I find that at that time Mr. Bureau said:
This act has for its purpose to make the service efficient, to employ the best men and to make them feel they are going to be treated in a proper way-
Apparently, during the period from 1918 to 1923 abuses crept into the act; a committee
(Mr. Pouliot.]
was formed and what was known as the Malcolm report was brought into the house. This committee suggested a great many amendments to the act, but apparently no serious action was taken. Then, in 1930 a new government came into power, and what happened from one end of this country to the other? Civil servants-yes, and a good many in my riding-had their heads cut clean off. I can cite case after case of that kind in my own constituency, and I speak of that riding because I have knowledge of the facts. Appointments were made in direct opposition to the act, and I am going to cite one such appointment, that of the assistant customs officer in Kincardine. They held an apparent examination; returned soldiers were supposed to get a preference. The person appointed was right out of the office of the defeated candidate, and he was not a returned soldier in any event. Objection was raised by the returned soldiers, but nothing further happened. In the other part of my riding a medical officer was appointed to attend to the needs of the invalids. He was not under the civil service commission during the Liberal regime, but when the Conservative government felt their defeat to be imminent apparently they decided to cut off this man's head and appoint their own Conservative medical officer. They did so, but they wanted to make his appointment safe, so they placed him under the civil service commission.
Mr. MaeINNIS: On a point of order, Mr. Speaker, these are rather serious allegations against the commission, and the names of the persons in question should be stated.


Some hon. MEMBERS:: Order.


William Rae Tomlinson: I am endeavouring to prove that the civil service commission-
Mr. MaeINNIS: I ask for a ruling, Mr Speaker.


William Rae Tomlinson: The hon. gentleman can speak when I have finished. Now I want him to sit down.
Mr. MaeINNIS: I maintain that in fairness to the civil service commission the names of the persons referred to should be given.


Some hon. MEMBERS:: Sit down.


Walter Edward Foster: The hon. member for Bruce (Mr. Tomlinson) may proceed.


William Rae Tomlinson: I am sorry that the right hon. leader of the opposition is not here to-night to hear what I am saying. He tried to convince me that he was a marvellous supporter of the civil service commission, but

Canada-V. S. Trade Agreement
we saw what happened. When the Conservatives were in power they were not so particular in carrying out the act, but now that they are in opposition they want us to follow it strictly. I believe in the civil service commission and I think this is a marvellous act. I think we should carry it out in connection with the permanent employee, but I am going to cite some instances; in connection with lightkeepers the highest salary range at which an appointment may be made without reference to the commission is $150 per annum. They mean to tell me, as the member for a riding, that I have not the intelligence to make an appointment carrying any higher salary than that. On the other hand, however, they say that I have the intelligence to recommend an appointment to the postal service carrying a. salary of nearly $2,000 a year. That change was brought about by the former Conservative government in 1933, when they desired to make their personal appointments while they were in power.


James Earl Lawson: I rise to a point of order.


Some hon. MEMBERS:: Where is your point of order?


James Earl Lawson: The Speaker will determine that after I have had an opportunity of stating it. I do not think any hon. member is entitled-


Some hon. MEMBERS:: Order.


Jean-François Pouliot: If you want to make a speech, speak after the hon. member for Bruce.


Walter Edward Foster: Order.
Mr. LAWSON -to make a misstatement. The hon. gentleman has just stated that the Conservative government passed an act providing for certain appointments. I point out to you, sir, that the amendment to the Civil Service Act, made in 1933, to which the hon. member has referred, was passed-


Some hon. MEMBERS:: Order.


James Earl Lawson: *-by the house in pursuance of the recommendations of a committee, on a non-party vote. I therefore submit-


William Rae Tomlinson: I am surprised-


James Earl Lawson: -that your honour should request the hon. member to retract that statement.


Walter Edward Foster: The hour for the consideration of private and public bills having expired, the house wild revert to committee of ways and means.



WAYS AND MEANS


[Stage Direction]
The house in committee of ways and means, Mr. Beaubien in the chair.
United States tariff-353.	Cooking stoves
and ranges, having as an essential feature an electrical heating element, and parts thereof; any of the foregoing, finished or unfinished, wholly or in chief value of metal, and not specially provided for, 25 per cent ad valorem.
John Ritchie MacNicol: Had we passed item 302? When the house rose at six o'clock I thought we were just discussing that item.


Charles-Philippe Beaubien: I may inform the hon. gentleman that item 302 was passed.


John Ritchie MacNicol: It could not have been passed very well because I had just finished saying a few words on it and the member for Dufferin-Simcoe called it six o'clock.


Charles-Philippe Beaubien: I am quite sure it was passed.


An hon. MEMBER:: You called it six
o'clock.


John Ritchie MacNicol: Did I call it six
o'clock?


Charles-Philippe Beaubien: All
the items of 302 were passed.


Percy John Rowe: No, Mr. Chairman, I called it six o'clock if the hon. gentleman did not. The item was not carried.


Malcolm McLean: The chairman
says that it was, so it must have been.


John Ritchie MacNicol: How much was shipped
to the United States?


William Daum Euler: If my hon. friend will permit, perhaps I might proceed in the same way as in regard to the other items.


John Ritchie MacNicol: I shall be glad if the
minister does, because I want to say something along this line. If the item was not passed, I shall be pleased.


William Daum Euler: Electric cooking stoves and
ranges, under the Fordney-McCumber tariff were 40 per cent plus 10 per cent ad valorem, making 50 per cent. Under the Hawley-Smoot tariff the duty was 35 per cent; under the new trade agreement it is 25 per cent.
Exports from Canada to the United States were not specified prior to April 1, 1935, but for the ten months ending January of this

Canada-U. S. Trade Agreement
year there were two stoves exported, of the value of S105. But I might add that the concession was secured at the request of a Canadian manufacturer of electric stoves, who believes he can obtain some business in the United States following a reduction in the duty.


Abraham Albert Heaps: Were there any exports of
electric stoves other than those to the United States? If so, I would like to have the figures.


William Daum Euler: The exports were largely
to South Africa and New Zealand. The figures were all given yesterday; they are all split up here; it would be quite a long story to place them on Hansard again.


Abraham Albert Heaps: I do not want that done
again. Probably I did not hear them. Could the minister give the figures of the total production of electric stoves under this item for the last fiscal year?


William Daum Euler: Roughly added up, they
amount to about $1,500,000.


Abraham Albert Heaps: And the exports? I should
like to have them side by side with the production.


William Daum Euler: To the United Kingdom,
$105,000; to the United States, $440,000; to the Irish Free State, 860,950; to British South Africa, $582,000; to Australia, $31,000; to New Zealand, $35,000.


John Ritchie MacNicol: What were the imports
of electric stoves from the United States?


William Daum Euler: They were put on Hansard
yesterday. The figure is $203,000.


John Ritchie MacNicol: Would the minister
care to tell us what the firm or company mentioned by him advised the government would be a low enough tariff entering the United States to enable them to ship to the United States?


William Daum Euler: The firm was Moffats Limited. They wanted something slightly lower than we had obtained, but I think they have some hope that they will get some business with the tariff which has been obtained, 25 per cent. Naturally they would have preferred 20 per cent, but I do not think they are entirely hopeless of doing some business under this rate.


John Ritchie MacNicol: I hope the expectation of the government and of the firm will be realized, because the company is one of the very best that I know of making electric stoves. And'while apparently they shipped only two last year, if the figure refers to

them, I certainly shall be pleased to find that next year under this agreement their hopes may be realized. If they are, this will bring employment to Canadian workers.


William Daum Euler: I am not trying to advertise any particular firm, but my hon. friend knows they are an enterprising firm, and I am informed that they already have an inquiry for some 2,000 stoves from the United States.


Abraham Albert Heaps: In an item of this kind the tariff does not play as important a part as some may think. One of the most important factors in the sale of electric stoves is the cost of electric energy. When people have low priced electric power, as they have in Ontario or Winnipeg, they will take to using electrical equipment of all kinds, stoves, heaters and so on. I have not much hope at the present time that we shall be able to export many electric stoves to the United States, because there the cost of electric energy is so high compared with what it is here that very few families will use electric stoves, especially with gas so comparatively cheap there in comparison with electric power.


[Stage Direction]
Item agreed to.
United States tariff-401. Timber hewn, sided or squared, otherwise than by sawing, and round timber used for spars or in building wharves; sawed lumber and timber not specially provided for; all the foregoing, if of fir, spruce, pine, hemlock or larch, 50 cents per
1,000	feet board measure.
Provided, that any of the foregoing sawed timber and lumber of Douglas fir or western hemlock entered, or withdrawn from warehouse, for consumption, in any calendar year after 1935 in excess of an aggregate quantity of 250,000,000 feet, board measure, shall not be subject to this provision.
Mr. EULER; I think this is one of the most important concessions, if we choose to call it that, in the whole agreement. With regard to sawed lumber and timber not specially provided for, if of fir, spruce, pine, hemlock or larch, under the Fordney-Mc-Cumber tariff it was free; under the Hawley-Smoot tariff, $1 per thousand feet and $3 excise per thousand; under the new trade agreement it is cut in two; it is now 50 cents per thousand feet and $1 excise.
Round timber, fir, spruce, pine, hemlock or larch, used for spars or in building wharves, under the Fordney-McCumber tariff was free; under the Hawley-Smoot tariff, $1 per thousand ; under the new trade agreement, 50 cents per thousand.
Timber, hewn, sided or squared otherwise than by sawing, if of fir, spruce, pine, hemlock or larch, under the Fordney-McCumber

Canada-U. S. Trade Agreement
tariff was free; under the Hawley-Smoot tariff, $1 per thousand feet, and under the new trade agreement, 50 cents per thousand feet.
The exports from Canada to the United States of Douglas fir, planks and boards, and Douglas fir, squared timber, for the fiscal year ending March, 1930, amounted in round figures to 418 million feet, of a value of $7,986,000, and that dropped in 1935 to the small quantity of 3,273,000 feet, valued at $72,000, as compared with nearly $8,000,000 in 1930. Our exports to the United States of hemlock, pine and spruce, planks and boards, and white pine squared timber in 1930 amounted to 897 million feet, valued at $25,000,000. In 1935 that had dropped to 212 million feet, valued at a little over $5,000,000, a drop from $25,000,000 to $5,000,000 in five years. Our exports of soft wood and hardwood in 1930 to the United States amounted to 121 million feet, valued at $5,754,000, and in 1935 to 19 million feet, valued at $665,000.
I might perhaps give a little further information because no doubt questions will be asked in any event. The United States duty of one dollar per thousand feet as provided in their tariff act of 1930 applies to timber hewn, sawn or squared other than by sawing, and round timber used for spars or in building wharves, and sawed lumber and timber not specially provided for. The excise tax of $3 per thousand feet applies to lumber rough or planed or dressed on one or more sides, except flooring made of maple but not Japanese maple, and it applies to all lumber covered by this classification irrespective of the species of tree from which it is cut. The quota for western hemlock and Douglas fir is 250 million feet.
Percy John Rowe: I know the minister will agree that the Hawley-Smoot tariff did not affect shipments of lumber during the year for which he has given figures. Would he give the aggregate exports of lumber of all kinds for 1931 and compare it with the total for 1930?


William Daum Euler: Total exports of all kinds of lumber, board measure?


Percy John Rowe: I want just the aggregate.


William Daum Euler: The total for 1930 was
1,437.136,000	board feet and in 1931, 986,446,000 board feet.


Malcolm McLean: The minister said something about the quota for fir and western hemlock. Does the quota cover spruce also?


Malcolm McLean: There is no quota on spruce?


William Daum Euler: No.


Mr. GREEN:: During the course of the discussion on the lumber items last evening the hon. member for Temiscouata (Mr. Pouliot), for whom I have a very sincere regard, made the following statement:
The Tory party is responsible for the decrease in the lumber trade. Whatever they
say they cannot change the facts; they are guilty of that great offence of destroying the lumber trade of this country. That is the fact, and every lumber man is a witness to it.
Those remarks were very largely concurred in by the hon. member for Dauphin (Mr. Ward). I would not presume to explain the situation in eastern Canada, but so far as the lumber trade in the province of British Columbia is concerned, those statements are just the reverse of the facts. From my observations I believe that hon. members are only too anxious to hear the actual facts in regard to any of these questions. I propose to give a brief summary of the position of the lumber trade in British Columbia, and I shall try to give it from a non-partisan viewpoint entirely.
The most important fact, and one that I cannot emphasize too strongly, is that our lumber trade in British Columbia is to-day standing on the foundation of the empire trade agreements, and the one thing we do not want, and the one thing we will not stand for, is to have the empire trade agreements endangered in any way. That statement about the empire trade agreements may sound a little strong to some hon. members, but I think I can best explain it by giving the committee a picture of the lumber trade during a few of the recent years.
The figures I am going to give the committee are taken from the 1935 report of the trade extension committee of British Columbia Lumber and Shingle Manufacturers Limited, an organization composed of all the leading lumber exporters of British Columbia. It is a non-partisan organization concerned only with promoting the lumber trade. May I say that behind all foreign trade, of which we hear so much, there has been the splendid work of some group of Canadian citizens, and I do not think there is any group of citizens in Canada to-day deserving of more credit for promoting our foreign trade than is this group of lumber men in my own province. They have gone to great expense to send trade representatives to the different dominions; they have gone to Washington to try to reason with the government there; they have really


William Daum Euler: No.
1190	COMMONS
Canada-U. S. Trade Agreement
done a first-class job in promoting the sale of Canadian lumber in foreign markets. My figures refer only to the coast region of British Columbia, but the great bulk of the lumber shipped from our province comes from that coast region. The figures are only approximate, to the nearest ten million feet board measure.
First, let me take the committee to 1929, a year that I have noticed brings happy memories to some members of the house. Let us get a picture of conditions at that time in the lumber trade. Our best market for British Columbia lumber in that year was one that is very hard to beat, the home market. We sold in Canada from the coast region of British Columbia over one billion feet board measure; of this about 40 per cent was sold in our own province; we shipped 36 per cent to our neighbours on the prairies, for whom incidentally we have a very high regard, and we shipped 25 per cent to eastern Canada. Our next best customer was the United States, where we sold 540 million feet, or just a little over half of what we sold in the home market. We sold in foreign countries, other than the United States, 240 million feet, and we sold to empire countries 160 million feet.
I carry hon. members along two years further to 1931, and I am skipping the intervening year not in order to avoid anything, but simply to save time, because the trend of the figures is practically the same from year to year. In 1931 our best market was still Canada. We sold just over 520 million feet in Canada in that depression year as compared with a little over the billion feet in 1929. By this time eastern Canada had replaced the prairies as our second best home market. We sold the United States 270 million feet although the Hawley-Smoot tariff had come into effect and there was a duty of $1 per thousand feet against our lumber. We sold to foreign countries 200 million feet, and to the empire 160 million feet. The last figure was the same as in 1929 largely because of the activities of the lumbermen in British Columbia.
Then we come to 1932. In this year our best market was still in Canada, but sales had dropped from 520 million feet to 360 million feet. For the first time the British empire was our second best market, sales there coming up to 250 million feet. This increase was brought about by the fact that we received a preference of 10 per cent under the Canada-United Kingdom trade agreement. The foreign market had decreased to 115 million feet and the United States market had dropped to 70 million feet. One of the

reasons for this drop was the fact that on June 21, 1932, the United States put into effect an excise tax of $3 per thousand feet. The hon. member for Dauphin said last night that this excise tax was in retaliation for our tariffs, but that is not the case. That excise tax was an emergency measure. The building trade in the United States had slowed up and the Americans were unable to get rid of their lumber, so they effectively stopped the importation of Canadian lumber. Incidentally, that tax was only temporary; it was renewed in 1935, and I believe it will come up for consideration again in 1937. At that time we hope the United States will see fit to take it off entirely.
We come now to 1935. Our best market in that year was the British empire, our trade having gone up to 640 million feet, four times what it was in 1929. This increase occurred despite four years of depression. Our home trade was now in second place, the total being 560 million feet; this trade had improved with conditions. Our foreign trade had come up to 160 million feet and there had also been an improvement in the trade with the United States to 100 million feet.
Under the Canada-United States trade agreement both the excise tax and the duty are cut in half. Instead of $4 per thousand feet we shall have to pay only $2, and let me say here that that will be a great help to the producers in British Columbia. I give the government credit for giving us that much assistance. However, there is a quota of 250 million feet.


Mr. HANSON:: That applies only to
Douglas fir and hemlock.


Howard Charles Green: I was just going to explain
that. This quota of 250 million feet applies only to Douglas fir and hemlock, although it must be remembered that in 1929 we sold the United States twice the amount of this quota. Quotas are something new to Canada. I believe this is the first time that one has ever been placed against us by the United States. I ask hon. members not to be misled during the next few months by the increases in lumber shipments to the United States, because at the present time lumber exporters are rushing lumber to that country in order to get their own lumber in before the quota is used up.
I should like the committee to compare that quota of 250 million feet with the sales to the empire totalling 640 million feet. This comparison will give the whole picture in a nutshell. It will show why the lumbermen of British Columbia are more concerned with the empire agreements than they are with

Canada-U. S. Trade Agreement
the Canada-United States agreement. The empire trade is far more important than the trade with the United States, because in empire trade there is great room for expansion while in the case of the United States we are met with the quota. Russia, Sweden and the Baltic countries sell to the United Kingdom four times as much lumber as we do; this shows the vast possibilities for expansion in that market. Also our empire trade is not subject to the dangers confronting our trade with the United States. The chief competitors of British Columbia in the American market are the lumbermen of Washington and Oregon, and they offer stiff competition. I should like to give some figures in explanation of this competition. In 1929 these two states shipped 550 million feet of lumber to the British empire in competition with British Columbia; this was nearly three times as much as the sales of British Columbia. Last year as a result of the empire trade agreements, Washington and Oregon shipped only 70 million feet to empire countries as compared with the 550 million feet shipped in 1929; this was just about one-ninth of what we shipped. Naturally this has irritated the lumbermen of the two states in question. These people have a strong lobby in Washington, and if the Roosevelt administration is defeated, I believe there will be little doubt that the lumbermen and other interests will make short work of this Canada-United States agreement.
My own opinion is that there is more scope for the development of trade within the empire than with the United States. The products of that group of nations which we term the British commonwealth are of great variety. This is not the case with Canada and the United States. As I have said already, the lumber of British Columbia must compete with the lumber of Washington and Oregon. As the hon. member for Yale (Mr. Stirling) told us the other evening, British Columbia fruit must meet American competition. The same thing applies to the fruit of Ontario and Nova Scotia. Wheat and other grains from our prairies and the manufactured products of Ontario and Quebec must compete with similar products of the nation to the south. The same applies to the cattle of the west and the fish of the maritime provinces. Both Canada and the United States produce practically the same commodities and there are definite limitations to the expansion of trade. This is not the case within the empire.
Finally, I believe it will always be more satisfactory for us to deal within the empire. Just as sentiment helps in business, so does
it help in trade between nations. There is a certain sentimental feeling between the different countries comprising the British empire. We know we are not so apt to be cut off on short notice by any of our sister nations, which might happen in the case of the United States, whose dealings with us are on a cold-blooded bargaining basis and always have been.


William Lyon Mackenzie King: Mr. Chairman, from what the hon. member, who has just spoken, (Mr. Green) has said, it would seem that in his opinion we have been discussing the relative merits of the Canada-United States agreement and the Canada-United Kingdom agreement, and that it was a matter of choosing between one or the other. Surely my hon. friend kpows that there is nothing of the kind at stake. If it can have both agreements British Columbia will be better off than by having only one, and the fact that there are possibilities of one agreement not continuing indefinitely applies equally to the other. There may arise circumstances which will occasion alterations in either agreement, and for that very reason we ought to be glad to have two strings to our bow instead of one.


Howard Charles Green: I thought I made it clear
that I gave the Prime Minister every credit for this preference in the lumber trade. I simply wish to point out, from a non-partisan standpoint, altogether regardless of party, that it is absolutely vital to us-and I say this in case some question may come up next year or the year after with respect to the empire agreements-that we must have these empire agreements. They are absolutely vital to our lumber trade and are far more important than the agreement with the United States.


William Lyon Mackenzie King: I want to
make it perfectly clear to my hon. friend that so far as the Canada-United Kingdom agreement is concerned it is in no way prejudiced or affected by this agreement. The greatest care was taken to see that nothing in this agreement should affect the Canada-United Kingdom agreement either at the present time or at any future time. I might add, however, that if in negotiating the agreement the government had not been restricted because of certain provisions in the Canada-United Kingdom agreement greater concessions might have been obtained from the United States with respect to this agreement. It was felt, however, that the Canada-United Kingdom agreement was there and should stand as it was in all its details, and it has been left in that way.

Canada-U. S. Trade Agreement


William Daum Euler: Perhaps I might refer to
the statement of my hon. friend from Vancouver South (Mr. Green) with regard to the question of quotas. Ordinarily I believe a quota means that beyond a certain point there is an absolute embargo or prohibition of imports. That is not the case in respect of any of these items. With regard to Douglas fir and western hemlock, the quota, so-called, applies to the 250,000,000 feet upon which there is a duty of $2 instead of $4 as before; but if fortunately we do reach that amount of 250,000,000 feet there is no prohibition of further exports to the United States; only any amount above 250,000,000 feet will fall under the regular tariff of $4. There is considerable room for improvement in the export of these two woods. In 1934 we exported to the United States 25,000,000 feet as compared with 548,000,000 feet in 1930. I repeat, therefore, that there is a great deal of room for improvement in connection with these two woods. I might also make this comment without offence:	My
hon. friend said that if a Republican administration came into office in the United States they would soon abolish the agreement. Well, this agreement was made with the one intention which I think should govern all trade agreements with other countries, namely, that the benefit is mutual. But if he fears that the United States will nullify this agreement, this shows at least that my hon. friends must think there was something advantageous to Canada in making the agreement.


Howard Charles Green: The minister says that
when we have reached 250,000,000 feet in our exports there is nothing to prevent us from exporting more; there will be no embargo. For all practical purposes, so far as the lumbermen are concerned, as the minister understands, there is an embargo because we cannot ship our lumber and pay $4 a thousand.


William Daum Euler: We shipped 25,000,000 feet.


James Earl Lawson: When the minister gave the comparative figures for 1930 and 1935, was he referring to calendar or fiscal years?


William Daum Euler: Fiscal years.


James Earl Lawson: So that the minister should not be too optimistic as to the recovery which may be anticipated from the agreement, I would call his attention to the fact that in 1930 our exports of Douglas fir and western hemlock, amounting to 548,000,000 feet, came under the old Fordney-McCumber tariff, under which they were free, whereas

the exports of 1935, reduced to 25,000,000 feet, came under the Hawley-Smoot tariff, which was $4 per thousand. Under this agreement the item is not back to free, where it was under the Fordney-McCumber tariff, but is $2 instead of S4.


William Daum Euler: It is a great deal better than it was.


James Earl Lawson: Oh, half a loaf is better than no bread.


Charles Avery Dunning: The full extent of the president's powers.


[Stage Direction]
Item agreed to.
United States tariff-402. Maple (except Japanese maple), birch and beech: flooring, 4 per cent ad valorem.
William Daum Euler: Under the Hawley-Smoot tariff it was 8 per cent ad valorem; that is cut to 4 per cent under the trade agreement. Exports to the United States from Canada in 1930 are not available; in 1935 they were
943,000	feet, valued at $43,353.


James Earl Lawson: What was the rate under the Fordney-McCumber tariff?


William Daum Euler: It was free.


[Stage Direction]
Item agreed to.
United States tariff-412. Ice-hockey sticks, wholly or in chief value of wood, 20 per cent ad valorem.
William Daum Euler: Under the Fordney-McCumber tariff it was 33J per cent, and under the Hawley-Smoot tariff 33J; under the trade agreement it is 20 per cent.


[Stage Direction]
Item agreed to.
United States tariff-503. Maple sugar, 4 cents per pound.
William Daum Euler: Under the Fordney-McCumber tariff it was 4 cents a pound and under the Hawley-Smoot tariff, 8 cents a pound; since March 7, 1931, it has been 6 cents a pound. Now it is 4 cents.


Abraham Albert Heaps: What are the exports?


William Daum Euler: Exports in 1930 were 12,000,000 pounds, valued at $2,390,000; in 1935 they dropped1 to 3,133,000 pounds, valued at $468,000.


[Stage Direction]
Item agreed to.
United States tariff-701. Cattle, weighing less than 175 pounds each, li cents per pound; cattle, weighing 700 pounds or more each and not specially provided for, 2 cents per pound; coivs, weighing 700 pounds or more each and imported specially for dairy purposes, 1J cents per pound.

Canada-U. S. Trade Agreement
Provided, that none of the foregoing entered, or withdrawn from warehouse for consumption in excess of the quantities respectively specified below in any calendar year after 1935 shall be subject to the above provisions:
Cattle, weighing less than 175 pounds each: i of 1 per centum of the average annual total number of cattle (including calves) slaughtered in the United States during the calendar years 1928 to 1932, both inclusive (51,933 head).
Cattle, weighing 700 pounds or more each and not specially provided for: f of 1 per centum of the average annual total number of cattle (including calves) slaughtered in the United States during the calendar years 1928 to 1932, both inclusive (155,799 head).
Cows, weighing 700 pounds or more each and imported specially for dairy purposes: (20,000 head).
William Daum Euler: This is another important item. Under the Fordney-McCumber tariff it was li cents a pound and was increased under the Hawley-Smoot tariff to 2i cents Under the new trade agreement it reverts to the Fordney-McCumber rate of li cents a pound up to 51.933 head per year.
On cattle weighing 700 pounds or more each, not specially provided for, under the Fordney-McCumber agreement, the duty was li cents per pound when they were under 1,050 pounds, and 2 cents a pound when they were 1,050 pounds and over. Under the Hawley-Smoot tariff, that was doubled to 3 cents a pound. Under the new trade agreement it is 2 cents a pound up to 155,799 head per year. On cows weighing 700 pounds or more each and imported specially for dairy purposes, the Fordney-McCumber tariff was li cents a pound when they were under 1,050 pounds, and 2 cents a pound when they were 1,050 pounds and over. Under the Hawley-Smoot tariff the duty was 3 cents a pound; now it is li cents a pound up to 20,000 head per year.
Exports to the United States for the fiscal year ended 1930: Cattle one year old and less n.o.p.,	85,000, of the value of roughly
$2,000,000. This dropped in 1935 to 1,113 head, with a value of $23,000, instead of $2,000,000 as in 1930. As regards cattle over one year old n.o.p., in 1930 the number was 125,280, and it dropped, to 22,746 in 1935. The value in 1930 was slightly over $8,000,000; in 1935 it was $1,254,000. On cattle for dairy purposes, in 1930 the number was 21,765; this dropped in 1935 to 2,934. The value in 1930 was slightly over $2,000,000; in 1935, it was $173,000.


Percy John Rowe: The minister has referred to our exports in 1930, and we have that tabulation statement here on page 30, but of course in the comparison between 1930 and 1935, wherein I notice most hon. members have charged the former administration with
responsibility for the falling off of exports, it must be remembered that the Hawley-Smoot tariff came into effect early in 1930, and I think a more reasonable comparison might be drawn from the figures of 1931. I find that while, by the minister's own figures, we exported 252,271 head immediately following the Hawley-Smoot tariff of 1931, which cannot be charged to any weakness of the administration on this side of the line, our total exports of cows, calves, and 700-pound beef cattle fell to 36,908 from 252,000. As soon as the Hawley-Smoot tariff went into effect in 1931, I find that of beef cattle weighing 700 pounds or more we exported only 1,976. Of cattle one year old, 700 pounds, we exported 1,976 head only in the year immediately following the Hawley-Smoot tariff, whereas in the year 1935 before the present agreement we exported 27,746. So the Hawley-Smoot tariff evidently had considerable effect, as had the enormous destruction that occurred in the United States, when they destroyed their hogs as well, and of course the price increased with the temporary demand in 1935. At the present time it is true we have had a slight increase.
I wish to say to the government that this item is of some help to the cattle breeders in Canada, especially at times of temporary demand in the United States. It is not any help to us in years when their cattle are lower priced than ours, and I might point out that it is of no significant advantage and there are very few cattle breeders in Canada who would want to sacrifice other very important Canadian interests for this slight advantage we get in cattle. It is not in any way comparable with what Canada received prior to the Fordney-McCumber tariff in 1922. In essence it means merely that we have secured a market in the United States for cattle at li cents a pound in some classifications and 2 cents a pound in others, and we are paying from li to 2 cents a pound duty to export to the United States under this agreement half as many cattle as we sold to the United States prior to 1922 free of duty. Where we sold around 497,000, 500,000 head prior to 1922 free of duty, we have now the exceptional privilege of a place in the United States market for practically half that amount, or approximately 257,000 head. So far as the effect on our cattle industry is concerned, the temporary advantage as regards live cattle is of some slight assistance, but I think those who represent cattle breeders and those who might be cattle breeders will agree with me that the price recently has not reflected any great advantage to Canadian producers.

Canada-U. S. Trade Agreement


Mr. OOLDWELL:: Has the minister any figures-


William Daum Euler: I was going to give the figures that possibly my hon. friend was about to ask for. I think it will be of interest to the committee to know this. In January,
1935,	we exported cattle over one year old to the number of 604; and this year, in January, 8,224. The value a year ago in January was 131,237; this year, in January, $425,850; in February, 1935, $360,000, and in February of this year, $626,000.


Percy John Rowe: Would the minister give us the figures for December of each year, 1935 and 1934?


William Daum Euler: No; I do not have them, and I cannot yet give the figures for December of
1936.


Percy John Rowe: I did not ask for 1936. I asked for December of 1935.


William Daum Euler: No; I do not have them.


Percy John Rowe: When you have January, surely you have December?


Charles Avery Dunning: We compare months when the agreement was in effect with months when it was not in effect.


Percy John Rowe: It was not in effect in December, and if you have the items for January, a month later, you surely have them for December.


Charles Avery Dunning: We are taking corresponding months in each year.


Malcolm McLean: I think this committee, and certainly the people throughout Canada who have cattle for sale, will remember very well when, in 1930, my hon. friend the member for Dufferin-Simcoe (Mr. Rowe) and the right hon. leader of the opposition (Mr. Bennett) were crossing this country, they were weeping bitter tears, bemoaning the sad fate of those hundred thousand dairy cattle that were condemned to be milked on the banks of the Albany instead of on the banks of the St. Lawrence-, in spite of the fact that the farmers of Quebec and Ontario particularly, and the farmers of the maritimes and Manitoba to some extent, had been selling those cattle at prices between $125 and $150. It was not very long after that until a 1,400 pound cow would not carry herself to market, until farmers and dealers had to dig up some of the money to pay the freight on a 1,400 pound cow from the shipping point to a point like Winnipeg.


Percy John Rowe: They killed them in the United States.


Malcolm McLean: They killed them in the United States and they killed them in Canada too, but after they killed them the beef was not worth as much as the freight.


Percy John Rowe: They were not worth anything over there.


Malcolm McLean: That is no reason why we should throw them away here. We are a more careful people, perhaps. Anyway we destroyed the trade in them.


Percy John Rowe: You would not think we were a more capable people if you looked at this agreement.


Malcolm McLean: I said "more
careful," and if you look at some of our actions in the past five years you would think we are neither capable nor careful. But we have amended that, and to-day our cattle are going to market to be traded for something that is of value. It is true that in the fiscal year 1935 there was a great shortage of feed in many of the American middle-west states. Naturally there was a demand for some cattle to go from Canada, and the price was certainly a good deal higher than it had been for some time before that. That was a particular sort of circumstance operating at -that time, and I am afraid the price will not be as good now. I well remember, however, when beef cattle were being shipped out in large quantities, in 1930, just at the end of the fiscal year, and when they were worth eight cents a pound to the farmer at the shipping point. At that time my hon. friends were bewailing the ruination of the cattle industry; that was one of their principal cries in western Canada, -and probably in the east as well. It was not long before the wailing was of another kind, however. I think -this is one of the most valuable items ever put into any agreement, because it gives a certain outlet for a large number of cattle at what will be a comparatively good price. Prices may not be as high as we would like them, but certainly they will be a great deal better than when this and other outlets were lacking. I think the government are to be commended for having secured this reduction, and I know the cattlemen of both western and eastern Canada appreciate it.


Percy John Rowe: I do not want to delay the item too long, but in answer to the hon. member for Melfort may I say that while in 1930 we exported probably 100,000 head of cattle, under this agreement we are limited to 20,000 head, so the assistance the dairy industry will receive through the export of our dairy cattle will not be very extensive.

Canada-U. S. Trade Agreement
We now have a quota of 20,000 head of dairy cattle, and they must be carefully inspected before they can be exported. As a matter of fact it takes about six months to get a cow ready to go to the United States now; she has to have all sorts of certificates. The regulations are almost as strict as they are in connection with their immigration. A cow must be inspected for tuberculosis and twice for Bang's disease, in case she might react from the first test. So this quota of
20,000	head limits the advantage to the fortunate few who have highly accredited, carefully inspected stock, almost in the same category as registered cattle. Therefore I say that this will not be of any very great general advantage to the dairy farmers at large, who have been shipping cattle to the United States market for the last three or four years.


William Daum Euler: Undoubtedly it would be
desirable to have a larger quota than 20,000, but at the same time that is a very substantial figure. The figures for 1929, which is as far back as I can go, show that under the Fordney-McCumber tariff of that time we exported only a little over 21,000 head of dairy cattle.


Ernest Edward Perley: This is
very good as far as it goes, but of course the quota limits it.


William Daum Euler: It is not limited; we can
always export more, but not under these terms.


Ernest Edward Perley: The cattle
commonly called Stockers or feeders, under one year old and weighing from 175 to 700 pounds, are not included under this item. It is interesting to note that in 1930 we exported 85,226 head of these cattle and in 1931 we exported 27,188 head. In our exports of cattle of that class we did not lose ground as we did in the heavier classes. I should like to know what effort the government made to have this agreement include cattle weighing from 175 to 700 pounds.


William Daum Euler: Every effort was made to
have those included, but I am informed that if that concession had been granted it would have meant a greater advantage to Mexico than to Canada.


Ernest Edward Perley: Then how was it that in 1931 we kept closer to our average shipments in that class than we did in any other class of cattle?


Mr. FAIR:: Does the minister think there
is any possibility of having the 2 cent per pound duty on cattle weighing over 700 pounds reduced or removed in the near future.


William Daum Euler: I am afraid I cannot answer that question definitely. I suppose an effort will be made whenever we think such an effort might be successful, but just at the moment, immediately after the conclusion of this agreement, I do not think we can anticipate any immediate action being taken along that line.


Mr. EVANS:: I would feel remiss in my
duty to my constituents if I did not commend the government for securing a lower duty on cattle entering the United States. I represent a constituency which produces perhaps more cattle than does any other constituency in western Canada, and I may tell the committee that on the first day of January five trainloads of cattle were loaded in southern Alberta and southwestern Saskatchewan in order to take advantage of this reduction. Very satisfactory returns were received from those shipments. I was interested in one shipment and I know it brought a good deal more than it would have brought on the Winnipeg market on the same day.


Ernest Edward Perley: How about
the shipments during February? How have they turned out? I do not think very many are being shipped.


Charles Avery Dunning: Double the volume in
dollars as compared with February a year ago.


Mr. DOUGLAS:: What has been the effect of this increased export on the price at Ohicago? How would prices compare, as between January, 1936, and January, 1935, on the Chicago market?


Malcolm McLean: While the minister is looking that up-


William Daum Euler: I am sorry, but I did not
hear the question; my attention was taken up elsewhere.


Thomas Clement (Tommy) Douglas: I was asking if the minister could say what has been the effect of this increased export on the price of cattle in the United States. How would the Chicago price in January, 1936, compare with the Chicago price in January, 1935?


William Daum Euler: I am informed that the price was higher in 1935 because of drought conditions in that country.


Thomas Clement (Tommy) Douglas: Has the minister the
figures?


William Daum Euler: No, I have not the figures.



Canada-U. S. Trade Agreement


Ernest Edward Perley: No doubt
the statistical department will have the prices of cattle each week in the different markets. Could the minister give us the prices at Chicago during the first week in January and the first week in March? Perhaps the minister might give the prices for each week.


Percy John Rowe: Put the Toronto
prices on record while you are at it.


William Daum Euler: I have not all the prices,
but I am informed that on Thursday of last week the Chicago price was $10.25 to $1125 for choice steers, 1,050 pounds and up.


James J. Donnelly: How about Winnipeg?


William Daum Euler: $4.75 to $5.


Ernest Edward Perley: We would like the figures for each week of January. February and March.


William Daum Euler: I am sorry; we do not have them here.


Percy John Rowe: Is it not a fact that cattle are cheaper on the Toronto live stock market now than they were prior to the agreement, cheaper in January than in December?


William Daum Euler: Yes; they were.


An hon. MEMBER:: Did shipping the cattle to the United States cause that?


Gordon Timlin Purdy: I have in my hand a bulletin issued by the Department of Agriculture of Nova Scotia which shows that in January of this year the price of milch cows in New York state was $85 as compared with $60 a year ago. That will be good news for the dairy farmers of the maritime provinces.


Mr. GARDINER:: I have a list of the prices of cattle actually shipped from Ontario to Chicago in January of this year. On one load of steers, average weight 1,512 pounds, the selling price at Chicago was $10.25. The cost to take them to Chicago as compared with Toronto was $2.25 greater. The Toronto market price on that day was $7.25, which means a difference of seventy-five cents in favour of Chicago.
Then, on one load of steers averaging 1,458 pounds, the sale price at Chicago was $9.75, equal to $7.50, Toronto, whereas the Toronto market price was $7.00, a difference of fifty cents per hundred in favour of Chicago.
On five head of cows weighing 1,310 pounds, the sale price was $7.75 at Chicago, equal to $5.50, Toronto, whereas the Toronto market price was $4.25, a difference of $125 in favour of Chicago.
On nine head of cows weighing 1,083 pounds, the sale price at Chicago was $7.50, equal to

$5.25, Toronto, whereas the Toronto market price was $4.25, an advantage of $1 per hundred pounds at Chicago.
On six head of cows, 1,080 pounds average, the sale price at Chicago was $6.75, equal to $4.50, Toronto, whereas the Toronto market price was $4.25, an advantage of twenty-five cents in favour of Chicago.
Then I have another list for Buffalo showing an advantage all the way down of twenty-five cents per hundred on four different lots sold there during the same week. This would indicate that there was a decided advantage to Ontario farmers in being able to ship to Chicago and to Buffalo during January. That of course does not cover the whole month.
I may say that during that time there was a decided advantage in favour of heavy well-fed and well-finished steers, and those who were interested in the shipment of cattle during that period were advocating the shipping of as large a quantity as possible of heavy well-fed steers to Chicago rather than filling our quota with lighter types of cattle. I think probably the same thing carries down to the present time, with this difference, that the price is not quite so good at present as it was then.


Mr. PERLEY (Qu'Appelie):: The figures the minister has given are very interesting. In the first case he said that there was an advantage of seventy-five cents per hundred, that is three-quarters of a cent per pound in favour of Chicago; the second figure was fifty cents or half a cent a pound. How about the duty of one cent a pound? Does that not more than offset it?


James Garfield Gardiner: You might take the next case where the difference was $1.25.


Percy John Rowe: The duty was taken into account.


James Garfield Gardiner: Yes; the duty was included. The figures given represent the advantage.
Mr. MeLEAN (Melfort): The duty must have been part of the cost of getting them to Chicago.


Mr. BEAUBIER:: Has the minister any information in regard to the British price? I notice recently there have been some shipments from Saint John.


James Garfield Gardiner: I have not the British price at hand. There would appear to be some opportunity to ship cattle to Great Britain during the months immediately ahead of us.

Canada-TJ. S. Trade Agreement


James Earl Lawson: Was Canadian currency at a premium or a discount in terms of American currency during the time for which the Minister of Agriculture gave those different prices?


James Garfield Gardiner: It would be very close to par; I am not sure just which way it was.


James Earl Lawson: I have an idea, although I am not certain, that in January American currency was at a discount.


Malcolm McLean: The difference is not what it was a few years ago.


Percy John Rowe: And not like what it probably will be a few years hence.


Thomas Clement (Tommy) Douglas: Would it be possible to get corresponding figures on cattle for last year?


James Garfield Gardiner: It would be possible but we would have to search for them.


Percy John Rowe: Has the minister the prices in November and December? I might point out that had the same rate of duty been applicable in December the American market would have been of very little use.


James Garfield Gardiner: In December I happened to be running an election in Saskatchewan and was meeting some of the arguments of the hon. member for Qu'Appelle. I did figure the prices at that time and found that the difference between Chicago and Winnipeg and Chicago and Minneapolis in December was almost exactly the diffrence in freight and the difference in duty crossing the line to get there.


Percy John Rowe: Then the duty was practically of no use.


Ernest Edward Perley: Could the minister give particulars in respect to the restrictions covering the shipment of cows into the different states? Are there different restrictions in the different states?


William Daum Euler: Does my hon. friend refer to quarantine?


Ernest Edward Perley: Any restrictions, health tests, blood tests?


William Daum Euler: I have not the information at hand. I do not suppose the matter of duty would affect the restrictions in any case.


Ernest Edward Perley: No, but it might affect the export. Perhaps the Minister of Agriculture (Mr. Gardiner) has the information.
12739-77}


William Daum Euler: Someone suggests that the best answer to that is that the exports doubled in February.


Ernest Edward Perley: I do not think that is a fair answer.


William Daum Euler: I give it for what it is worth.


Hugh Alexander Stewart: This is one of the items that undoubtedly is of advantage to Canada. However, there are two or three matters to which I wish to refer to clear it up. The Minister of Trade and Commerce said that there was no quota. That is perhaps technically correct, but undoubtedly there is a quota as far as benefits or reductions under this agreement are concerned. Once you get above that number of cattle then you are back where you were before, to a comparatively high duty. The next thing to be noted is that we are not getting the full reduction that the president had power to grant. We have on one item, dairy cows weighing 700 pounds or more, the duty reduced, on not over 20,000 head annually, from three cents to one and a half cents. On cattle weighing 700 pounds, the reduction is from three cents to two. That is less than the authority which the president had. On calves weighing less than 170 pounds, the reduction is from 2} cents to H cents, again less. As to this quota, because I shall refer to it as such, would the minister give us the total number of cattle slaughtered in the United States in a year? I saw something that would indicate that this quota is only one per cent of the cattle slaughtered in the United States in a year.


William Daum Euler: My hon. friend will find it in the agreement.


Hugh Alexander Stewart: You will not find in the agreement the number of cattle slaughtered in a year in the United States.


William Daum Euler: The five-year average for cattle is 12,182,400 and for calves 8,590,800, or a combined total for the five-year average of 20,773.200. The basis of the quota is one per cent of that figure, or 207,732 head.


Hugh Alexander Stewart: Exactly, one per cent.


[Stage Direction]
Item agreed to.
United States tariff-707. Cream, fresh or sour, 35 cents per gallon.
Provided that fresh or sour cream entered for consumption in excess of 1,500,000 gallons in any calendar year after 1935 shall not be subject to this provision.
Abraham Albert Heaps: Are these Canadian or
American gallons?	[DOT]


William Daum Euler: Wine gallons.

Canada-U. S. Trade Agreement


Abraham Albert Heaps: What is that, Canadian or American?


William Daum Euler: That is the American wine gallon.


Abraham Albert Heaps: So the figure mentioned in the item would be considerably less, expressed in Canadian gallons?


William Daum Euler: Yes.


Abraham Albert Heaps: How much less? It would represent about four-fifths of this figure?


William Daum Euler: No; five-sixths. Under the Fordney-McCumber tariff the rate on cream, fresh or sour, was 20 cents a gallon, and 30 cents a gallon after June 13, 1929. Under the Hawley-Smoot tariff the duty was 56j% cents a gallon, and under the new agreement it is 35 cents a gallon up to 1,500,000 gallons in any calendar year. Exports to the United States in 1930 amounted to 2,293,270 gallons, valued at 84,679,000, and in 1935, eight gallons valued at $8.


Percy John Rowe: What were the figures for 1931?


William Daum Euler: In 1931, 1,121,974 gallons.


Percy John Rowe: As compared with
2,293,000	gallons in 1930. In other words, exports were cut in two by the Hawley-Smoot tariff. I do not want to hold up this item unduly, but for the information of the committee can the minister say whether this rate of duty of 35 cents a gallon is not increased substantially when the cream is of a certain butter fat.


William Daum Euler: When it is over a certain content of butter fat it is classified as butter, but I do not know the exact figure.


Percy John Rowe: That is very important. I understand that the figure is very little over the average.


William Daum Euler: There would not be any change made by the agreement with regard to that, would there?


Percy John Rowe: There is a change.


William Daum Euler: Whether the duty was reduced or not the butter content under their regulations would remain the same.


Percy John Rowe: But it has the effect of increasing the duty.


Abraham Albert Heaps: Is there a difference between United States and Canadian regulations as to butter fat content, and which would govern in this case?


William Daum Euler: United States regulations, I would think, would govern imports into that country.


Abraham Albert Heaps: Is there anything in the agreement to specify that?


William Daum Euler: It is not specified, but one can take it for granted that the country that is allowing importations would subject them to their own regulations.


Abraham Albert Heaps: The quota restriction provides that any shipments in excess of 1,500,000 gallons in any calendar year come under the old rate. Similarly, as in the matter of gallonage we have to take the American gallon as a measure, we may have to take the American standard of butter fat to determine what is cream. Our butter fat content may be much higher than that of the United States, and when it is measured on the other side we may be short of the quota.


William Daum Euler: That may be true, but I would draw attention to what I said a moment ago, that whether the tariff is reduced or increased, that factor remains stationary. A change in the tariff will not make a change in the standards to which my hon. friend refers.


Abraham Albert Heaps: But if there is a difference between the United States and the Canadian standard, I would like to have some idea what the difference really is. We know that the difference between an American gallon and a Canadian gallon is approximately 20 per cent. Is there anything like that difference between the two countries in the standard of butter fat content?


Percy John Rowe: It would make no difference at all.


Thomas Clement (Tommy) Douglas: AVhat restrictions are there on the number of gallons of cream that can be exported under this agreement?


William Daum Euler: The limit under this reduced rate is 1,500,000 gallons, but there is no restriction on exports beyond that. They would pay the old rate.


Grote Stirling: Of course, the quota figured in Canadian gallons is much less than
1,500,000	gallons; it is approximately 1,200,000 gallons.


William Daum Euler: I can answer now the question of my hon. friend from Winnipeg North (Mr Heaps). Fresh or sour milk containing more than 5i per cent butter fat shall be dutiable as cream; fresh or sour cream containing more than 45 per cent of butter fat shall be dutiable as butter.

Canada-U. S. Trade Agreement


Alfred Johnson Brooks: How many gallons were exported to the United States in January and February of this year?


William Daum Euler: There have been no shipments yet, but several applications have been made to the veterinary director general for inspection of premises preparatory to shipping cream to the United States.


Mr. BETTS:: My riding is in the centre of a very rich dairying country. I have talked with a number of creamery men and farmers around London, and they are emphatic in saying that they could not get their cream into the United States under a duty of 56 cents, nor do they expect to get it in under a duty of 35 cents a gallon. According to them there is nothing in it.


William Daum Euler: That depends on the relative prices in the two countries. It might not be possible to ship at a given time, but this fact stands out, that the duty is a great deal less than it was under the former government.


Percy John Rowe: It is like that long list of items the minister read.


William Daum Euler: We would sooner have it this way than the way it was before.


Percy John Rowe: The reduction
makes nicer reading, even if you do not export anything under it.


James Garfield Gardiner: I am sorry the hon.
member for Sherbrooke (Mr. Howard) is not present to-nighit as just before dinner he showed me a letter which he had received from one of his constituents. This letter stated that this man was exporting cream to Boston in January and was netting twenty-six cents per pound of butter fat. This shows that cream is actually being shipped to Boston under this agreement.


Percy John Rowe: Was he not shipping in November and December?


James Garfield Gardiner: No, just since the agreement came into effect. While the records of the department so far do not show exports of cream, the fact remains that cream is being exported to the United States.


Harry James Barber: What price did that man get for his cream?


James Garfield Gardiner: The net price was
twenty-six point something as against the price of twenty-four cents that was being paid at that time.


Harry James Barber: That would be plus the
thirty-five cents.


James Garfield Gardiner: That was net to the
producer.


Harry James Barber: That would be forty-two
cents plus.


James Earl Lawson: I should like to have this item converted into terms of Canadian units. This quota is equivalent to a quota of
1.200.000	Canadian or imperial gallons, and the duty is equivalent to forty-two cents per Canadian or imperial gallon.


William Daum Euler: I have not figured it out.
If the relationship betwen the American and Canadian gallon is as five is to six, I suppose my hon. friend's figures are correct.


James Earl Lawson: It is four to five; our
gallon is one-fifth larger than theirs.


Ernest Edward Perley: This quota
is just a little more than what was shipped in 1931. I should like to know what efforts the government made to have all dairy products such as cream, milk, butter and cheese included in the agreement. Could the minister give the total consumption of cream in the United States?


William Daum Euler: I can assure my hon. friend that every effort was made to obtain as much as possible. Perhaps we were not able to get all that might be desired, but I think the concessions obtained are substantial and well worth while.


Ernest Edward Perley: I should like to know what percentage the quota of
1.500.000	gallons is of the total consumption of cream in the United States.


Percy John Rowe: About half of one per cent.


Hugh Alexander Stewart: These milk items are
more or less related. Could the minister give us the duty on milk, butter and cream going into the United States? The dairymen of eastern Canada are very much interested in this item, and I also come from a dairying district.


William Daum Euler: Milk does not enter into the agreement.


Hugh Alexander Stewart: No; but I should like
to know the rates.


William Daum Euler: Under the Hawley-Smoot
tariff, the rate was 6i cents a gallon and the same for sour milk. On condensed milk it was 1*8 cents per pound for the unsweetened milk. On dried, whole milk it was 6T'f cents per pound.


[Stage Direction]
Item agreed to.
[Stage Direction]
Canada-U. S. Trade Agreement
United States tariff-710. Cheddar cheese in original loaves, 5 cents per pound, but not less than 25 per cent ad valorem.
William Daum Euler: The rate under the Fordney-MeCumber tariff was 5 cents per pound, but not less than 25 per cent ad valorem; under the Hawley-Smoot tariff it was 7 cents per pound, but not less than 35 per cent ad valorem. Exports from Canada for the fiscal year ended March, 1930, amounted to 67,867 hundredweight, valued at $1,498,000. In 1935 this had dropped to 6,934 hundredweight, valued at $100,000. The February, 1935, figure was $3,000 as compared with $64,000 for February of this year.


[Stage Direction]
Item agreed to.
United States tariff-711.	Bird's, live:
chickens, ducks, geese, turkeys, and' guineas, 4 cents per pound.	.
William Daum Euler: Under the Fordney-MeCumber tariff the rate was 3 cents per pound1; under the Hawley-Smoot tariff, 8 cents per pound, and under the trade agreement, 4 cents per pound. In 1930 exports from Canada to the United States weTe 660,000, and in 1935 they were slightly over 9,000. The respective values were $544,000 and $4,500.


[Stage Direction]
Item agreed to.
United States tariff-712.	Birds, dead,
dressed or undressed, fresh, chilled, or frozen: chickens and guineas, 6 cents per pound.
Percy John Rowe: Could the minister give us the Canadian rates on dressed poultry? I understand that substantial quantities have come into Canada since the agreement. I understand that birds from San Francisco are being sold in Ottawa. When they can send them that distance through the Panama canal there must be a considerable margin.


William Daum Euler: The rates are 12J per cent, 174 per cent and 20 per cent.


James Earl Lawson: What are the United States rates?


William Daum Euler: Fordney-MeCumber tariff, 6 cents per pound; Hawley-Smoot tariff, 10 cents per pound, now reduced to 6 cents per pound.


Percy John Rowe: This item gives a *considerable advantage to the American poultry producer. We have to pay about 50 per cent to get our dressed poultry over there and we permit their poultry to come in here under a rate of 17i per cent. Perhaps that accounts for the importations now being made.


[Stage Direction]
Item agreed to,
	.. jU.ii
United States tariff-714.	Horses, unless
imported for immediate slaughter, valued at not more than $150 per head, $20 per head.
William Daum Euler: Under the Fordney-MeCumber the rate was $30 per head; under the Hawley-Smoot, $30 per head, and under the present agreement, $20 per head. Exports in 1930 were 672 head, valued at $108,000, and in 1935, 3,490 head, valued at $406,000.


[Stage Direction]
Item agreed to.
United States tariff-717(a). Fish, fresh or frozen (whether or not packed in ice), whole, or beheaded or viscerated or both, but not further advanced (except that the fins may be removed):	halibut, 1 cent per pound;
salmon, li cents per pound; swordfish (not including naturally or artificially frozen swordfish), 1J cents per pound; eels, J cent per pound.
Chubs, fresh-water mullet (catostomus) jacks, lake trout, saugers, tullibees, whitefish, and yellow pike, } cent per pound.
James Earl Lawson: Could the minister give us the American rates?


William Daum Euler: The rate on halibut under the Fordney-MeCumber tariff was 2 cents per pound; under the Hawley-Smoot, 2 cents per pound, and under the new agreement, one cent per pound. Exports in 1930 amounted to 41,736 hundredweight, valued at $570,000. In 1935 the figure was 26,000 hundredweight, valued at $230,000.


Abraham Albert Heaps: Does that include all the items enumerated?


William Daum Euler: No; just halibut.


Abraham Albert Heaps: What were the figures for swordfish?


William Daum Euler: The Fordney-MeCumber
tariff was 2 cents per pound and the Hawley-Smoot tariff, 2 cents per pound frozen and 3 cents per pound since February, 1936. Under the new agreement it will be li cents per pound. Exports in 1930 were 5,981 hundredweight, valued at $78,000 and in 1935 14,780 hundredweight, valued at $154,000.


[Stage Direction]
Item agreed to.
United States tariff-719. Fish, pickled' or salted (except fish packed in oil or in oil and other substances and except fish packed in air-tight containers weighing with their contents not more than 15 pounds each): salmon, 20 per cent ad valorem; alewives in bulk or in immediate containers weighing with their contents more than 15 pounds each, f cent per pound net weight.
William Daum Euler: The Fordney-MeCumber
tariff was 25 per cent ad valorem and the

Canada-U. S. Trade Agreement
Hawley-Smoot tariff the same. Under the trade agreement it is 20 per cent ad valorem. Exports in 1930 were 8,163 hundredweight, and in 1935, 9,552 hundredweight.


[Stage Direction]
Item agreed to.
United States tariff-720(a). Smoked herring (except herring packed in oil or in oil and other substances and except herring packed in air-tight containers weighing with their contents not more than 15 pounds each): hard dry-smoked, when whole or beheaded, but not further advanced, f cent per pound; boned, whether or not skinned, 1J cents per pound.
Item agreed to.
United States tariff-721(b). Razor clams (siliqua patula), packed in air-tight containers, 15 per cent ad valorem.
William Daum Euler: The reduction is from 23 per cent ad valorem to 15 per cent ad valorem. It was 35 per cent originally. I cannot give the quantities because canned clams are included with the others and not specified separately.


Alfred Johnson Brooks: The hon. member for Cape Breton North-Victoria mentioned swordfish and said that the revenue was $1,400,000. I know that he did not intend that; that figure refers to the weight. In 1934 the swordfish export was 1,409,000 pounds and the market value was $174,559.


[Stage Direction]
Item agreed to.
United States tariff-726. Hulled oats, unfit for human consumption, 8 cents per bushel of 32 pounds.
William Daum Euler: The Fordney-McCumber
tariff was 15 cents a bushel and the Hawley-Smoot tariff, 16 cents; now it is 8 cents. No figures are available for exports.


Mr. PELLETIER:: How much was shipped out of Canada last year?


William Daum Euler: There are no figures available.


[Stage Direction]
Item agreed to.
United States tariff-729. Wheat, unfit for human consumption, 10 per cent ad valorem.
René-Antoine Pelletier: I notice there is no reduction in the tariff on wheat unfit for human consumption. Last year in the west the United States required a good deal of such wheat for feed purposes, and owing to the prevalent weather conditions up north there are times when our wheat is frozen, so that it would mean a good deal to the
people in that part of the country to have a reduction on wheat, which is much more subject to frost than oats. This is an item which should be taken seriously into consideration.


[Stage Direction]
Item agreed to.
United' States tariff-730.	Bran, shorts,
byproduct feeds obtained in milling wheat or other cereals, 10 per cent ad valorem; mixed feeds, consisting of an admixture of grains or grain products with oil cake, oil-cake meal, molasses, or other feedstuffs, 10 per cent ad valorem.
United States tariff-731. Screenings, scalp-ings, chaff, or scourings of wheat, flaxseed, or other grains or seeds: unground, or ground, 10 per cent ad valorem.
Hugh Alexander Stewart: What are the rates?


William Daum Euler: The rate under the Fordney-McCumber tariff was 15 per cent ad valorem, 7i per cent after April 6, 1924. Under the Hawley-Smoot tariff it was 10 per cent ad valorem and it is now bound at 10 per cent ad valorem under the agreement.


Hugh Alexander Stewart: There is no reduction
from the Hawley-Smoot tariff.


William Daum Euler: No; but it cannot go higher.


Abraham Albert Heaps: If there is no change in these three items will the minister explain why they appear in the agreement?


William Daum Euler: There is surely an advantage in making certain that an item that is satisfactory may not be changed upward.


Abraham Albert Heaps: Can we have it reduced?
Mr. EULER; There is no objection to that if it can be accomplished.


James Earl Lawson: What were the exports
to the United States in 1935 under item 730?


William Daum Euler: Exports of bran, shorts and middlings in 1935 amounted to 2,599,358 hundredweight.


Percy John Rowe: These items
down to 731 are practically the same as they were, and I do not think there is any purpose in holding them up, but it seems rather strange that while we get no greater advantage in the American market in connection with these items, in connection with rye, wheat, wheat flour and barley we give a special advantage to the United States. We have reduced our duty on wheat from 30 to 12 cents; on barley by 50 per cent; and almost 50 per cent on oats. But we are paying 42 cents on our wheat going to the United States.

Canada-U. S. Trade Agreement


William Daum Euler: The fact that there are
some reductions is entirely incidental to the granting of the intermediate tariff, which was really the basis of the agreement. There is, however, a fixing of the tariff at the point at which it cannot be increased: it is bound at that percentage.


Percy John Rowe: You surely would not expect them to increase it when you reduce yours 50 per cent?


William Daum Euler: As I say, the reduction given to the United States is entirely the result of our granting them the intermediate tariff rates. It just follows incidentally.


René-Antoine Pelletier: The minister has no idea of the amount shipped out of the country under these particular items?


William Daum Euler: Which particular items?


René-Antoine Pelletier: Well, 731.


William Daum Euler: Grain screenings, exports from Canada to the United States, in 1935, 1,327,000 hundredweight, value $762,000.
Items 730 and 731 agreed to.
United States tariff-732. Cereal breakfast foods, and similar cereal preparations, by whatever name known, processed further than milling, and not specially provided for, 15 per cent ad valorem.


Percy John Rowe: Will the minister tell us what we pay going into the United States, on that item?


William Daum Euler: It is reduced from 20 to 15 per cent going into the United States.


Percy John Rowe: I beg your pardon, I meant-


William Daum Euler: Coming into Canada?
Twenty-seven and a half per cent. So we have the better of them there.


Percy John Rowe: Carried, then.


[Stage Direction]
Item agreed to.
United States tariff-734. Apples, green or ripe, 15 cents per bushel of 50 pounds.
Abraham Albert Heaps: Could the minister give us the quantity of apples shipped to the United States in, say 1930 and 1935?


William Daum Euler: 1930, 115,000 barrels, value $526,000; 1935, 4,493 barrels, as compared with 115,000 barrels in 1930.


James Earl Lawson: Would the minister be good enough to give us the item under the Fordney-McCumber tariff?


William Daum Euler: Yes; 25 cents a bushel of 50 pounds; Hawley-Smoot tariff, 25 cents a bushel, now reduced to 15 cents.


[Stage Direction]
Item agreed to.

United States tariff-736. Strawberries in their natural condition or in brine, I cent per pound.
William Daum Euler: Fordney-McCumber tariff, 11 cents per pound; Hawley-Smoot tariff, 11 cents per pound; under the trade agreement, 1 cents per pound. It is cut in half. Exports in 1930, 405,000 pounds; in 1935,
169,000	pounds.


James Earl Lawson: 
William Daum Euler: No; 11 cents.


Grote Stirling: It is a misprint in the document, then.


William Daum Euler: It is 11 cents.


Percy John Rowe: I might point out in connection with this item that, while it is a substantial reduction, and I compliment the government upon getting a reduction in that case of, if not fifty, forty per cent at least, it would have been a much greater benefit to the producers in Canada if we had secured a reduction in respect of the export of canned goods rather than to send the fruit in its natural state to the United States to be canned by American labour.


Hugh Alexander Stewart: Has the minister the exports in 1931?


William Daum Euler: The hon. member refers to strawberries? We do not have them for 1931. In 1930 they were 405,000 pounds; in 1935, 169,000 pounds.


Hugh Alexander Stewart: There was a tariff in-crase in 1930, was there not, under the Hawley-Smoot tariff?


William Daum Euler: No; it was the same, 11 cents a pound.
United States tariff-736. Blueberries, prepared or preserved, or frozen, but not in brine and not dried, desiccated or evaporated, and not specially provided for, 25 per cent ad valorem.


William Daum Euler: The reduction there is from 35 per cent to 25 per cent. Export figures are not available.


Mr. DUBOIS:: Before this item carries may we have the quantity exported into the United States?


William Daum Euler: The figures are not available.


Percy John Rowe: I think they were put on Hansard by the Minister of Finance the other day.


William Daum Euler: Those were fresh, not prepared. These are canned.


[Stage Direction]
Item agreed to.

Canada-U. S. Trade Agreement
United States tariff-737(1). Cherries in their natural state, 1 cent per pound.
William Daum Euler: The tariff was 2 cents a pound; now it is 1 cent a pound. Exports are not available. According to United States statistics they imported in 1934 from Canada, 400,000 pounds.


James Earl Lawson: What was the Fordney-McCumber rate?


William Daum Euler: Two cents, the same as the Hawley-Smoot.


Percy John Rowe: I think this should carry. We get 50 per cent advantage and let the Americans have our natural products so that they may can them and ship them back here.


[Stage Direction]
Item agreed to.
United States tariff-763. Grass seeds and other forage crop seeds: alfalfa, 4 cents per pound; alsike clover, 4 cents per pound; sweet clover, 2 cents per pound; timothy, 1 cent per pound; bluegrass, cents per pound.
Percy John Rowe: I do not want to hold up the item; we have fully 50 per cent under that item, but would the minister give us the Fordney-McCumber tariff on this item?


William Daum Euler: Four cents; the same as under the agreement. On alfalfa, 4 cents a pound, under the Fordney-McCumber, the same as it is now under the agreement; on alsike clover, the same, 4 cents and 4 cents; on sweet clover, 2 cents and 2 cents; on timothy, 2 cents, now 1 cent; on bluegrass, 2 cents, now 2j cents. But the 2| cents is a reduction of 50 per cent on the rate in the Hawley-Smoot tariff, which was 5 cents.


Percy John Rowe: I may just point
out that this is probably a clear-cut advantage to a country which has substantially raised its tariff; it is a demonstration of what the United States government could do with a high rate of tariff, just as the present government in Canada were able to do with the increase of tariff generally from 1931; they were in a better position to trade, because they had more to give away.


Ernest Lapointe: Three
cheers for protection.


Percy John Rowe: They have evidently given away quite a bit. In this item the United States have given to Canada the full 50 per cent preference, but it is to be
recalled that the United States tariff has been raised so high by the Hawley-Smoot tariff that they can give us fully 50 per cent advantage and still charge us 2i or 2J dollars a bushel on our product going into the United States, which I submit is yet a substantial duty. If the United States by the Hawley-Smoot tariff had raised their duty to 10 cents or 20 cents, and we had got 50 per cent reduction, it would look the same so far as the full advantage is concerned. So long as a country has a tariff at a reasonable height they have something to trade with and use as a weapon. We still pay the same duty as we did under the Fordney-McCumber tariff.


William Daum Euler: Perhaps this will be a more or less hopeful remark. Under the Fordney-McCumber tariff, which was practically the same as the tariff we have under the present agreement, we exported to the United States about 82,000,000 worth of produce under this heading, so that we may hope to recover a good deal of that business under a tariff that is not any higher and, in some instances, is lower than the Fordney-McCumber tariff.


Percy John Rowe: Yes; I submit that it is an advantage over the 8 cents a pound.


Alexander MacGillivray Young: In other words, it frees the channels of trade to real advantage.


Percy John Rowe: It is a real advantage over the 8 cent tariff, but we are still paying $2.40 a bushel. Bear that in mind.


Hugh Alexander Stewart: Not free enough for
you yet.


[Stage Direction]
Item agreed to.
United States tariff-769. Peas, green or unripe, when imported and entered for consumption during the period from July 1 to September 30, inclusive, in any year, 2 cents per pound.
Percy John Rowe: I think this should carry; it is another example of a natural product going to the United States, while we get the goods back in cans.


Abraham Albert Heaps: This duty is of a seasonal
character, applying for three months of the year. Has the minister any figures he can give the committee showing what quantity of this product was exported to the United States last year or the year before?


William Daum Euler: I have not our own figures
of exports; they are not available, but the imports given by the United States as com-
Canada-U. S. Trade Agreement

mg from Canada amounted to $20,000 in 1929 and to $3,000 in 1934. The rate now is reduced from 3-9 cents per pound to two 3ents per pound, practically cut in half.


Abraham Albert Heaps: These rates are effective
for only three months in the year, which I presume would reduce the figures the minister has given the committee.


William Daum Euler: I suppose these figures are
representative of those periods. These are yearly figures, but I suppose they apply to that season because it is only during that period that we export the green peas.


[Stage Direction]
Item agreed to.
United States tariff-771. White or Irish seed potatoes, certified by a responsible officer or agency of a foreign government in accordance with the official rules and regulations of that government to have been grown and approved especially, for use as seed, in containers marked with the foreign government's official certified seed potato tags, when entered for consumption during the period, from December 1 to the last day of the following February, inclusive, in any years, 60 cents per 100 pounds; from March 1 to November 30, inclusive, in any year, 45 cents per 100 pounds.
Provided, that such potatoes entered for consumption in excess of an aggregate of quantity 750,000 bushels of 60 pounds each in the twelve-month period begining on December 1 in any year shall not be subject to this provision.
Percy John Rowe: Would the minister give us the tariff on potatoes for table use?


William Daum Euler: It is 75 cents per hundred pounds.


Percy John Rowe: It remains the same?


William Daum Euler: Yes. I might say that
under the Hawley-Smoot tariff the rate on this item was 75 cents per hundred pounds. Now it is 60 cents from December 1 to the last day of the following February and 45 cents from March 1 to November 30, up to 750,000 bushels in any twelve month period beginning December 1 in any year.


Grote Stirling: What was it under the
Fordney-McCumiber tariff?


William Daum Euler: Fifty cents per hundred
pounds.


Percy John Rowe: What is our tariff against United States potatoes?
	.


William Daum Euler: Free.


Percy John Rowe: I might point
out that we allow United States potatoes in free and we have to pay 75 cents a hundred pounds going to the United States.


William Daum Euler: I understand that, but again it is incidental to the granting of the intermediate tariff to the United States. Last year, of course, my hon. friends had an opportunity of placing a tariff in the intermediate column if they had so desired.


James Earl Lawson: But you are complaining
of all the tariffs we did place there.


Hugh Alexander Stewart: The government must take the responsibility for this; they cannot place any of it on the former government. This is their agreement.


[Stage Direction]
Item agreed to.
United States tariff-773. Turnips and rutabagas, 12i cents per hundred pounds.
Item agreed to.
United' States tariff-779. Hay, $3 per ton of 2,000 pounds.
William Daum Euler: There is a reduction from $5 under the Hawley-Smoot tariff to $3. Under the Fordney-McCumber the rate was $4 per ton.


Harry James Barber: What were the exports?


William Daum Euler: In 1935 they were 69,819 tons.


Percy John Rowe: Under this item we have reduced our tariff from $5 to $1.75 a ton on hay coming into Canada. The United States tariff is reduced from $5 to $3. Again, there is not much reciprocity there.


William Daum Euler: I must give my hon. friend the same answer; this is incidental to the granting of the intermediate tariff, which I think my hon. friends were also willing to grant.


Hugh Alexander Stewart: What did the minister say the duty was before this reduction was made?


William Daum Euler: It was $4 under the Fordney-McCumber tariff and $5 under the Hawley-Smoot tariff. It is now $3.


Hugh Alexander Stewart: It would have been reduced to $2.50 if we had been given the full reduction the president was authorized to make.

Questions


William Daum Euler: We did not get that full reduction in every case, but I should say that the reduction from 15 to $3 was fairly substantial.


Hugh Alexander Stewart: Not in comparison with the reduction we have given.


[Stage Direction]
Item agreed to.
United States tariff-802. Whiskey of all types and classes, $2.50 per proof gallon.
Provided', that this provision shall not apply to any whiskey consisting in whole or in any part of distilled spirits which have not been aged in wooden containers at least four years prior to the date the whiskey is entered, or withdrawn from warehouse, for consumption.
James Earl Lawson: This is an item in respect of which I wish to present two matters to the government for consideration. I suggest that I cannot do that in less than seven or ten minutes, and it is now a few minutes to eleven o'clock.
Item stands.
Progress reported.
On motion of Mr. Mackenzie King the house adjourned at 10.58 p.m.
Wednesday, March 18, 1936