Mr. VITAL MALLETTE (Jacques-Cartier):: I have received a communication from the Reverend Albert Hinton, pastor of the Lilly Memorial Church, which is the United, Church at Pointe Claire, and also of the United Church of Canada, at Beaurepaire, both in the

county of Jacques-Cartier, province of Quebec, enclosing a petition praying that the government put into effect an embargo against the shipment of war materials to Japan. I desire to lay this petition before the house.



SUPREME COURT ACT


[Stage Direction]
On the order for motions:
Hon. C. H. CAHAN (St. Lawrence-St. George):: Mr. Speaker, I should like to mention a matter which I think will require the unanimous consent of the house. The first clause of the first section of Bill No. 9, to amend the Supreme Court Act, is deemed by the officials of the Department of Justice to be inadequate, as it is now phrased, to cover the suggestions made by the Minister of Justice (Mr. Lapointe) during the discussion on a similar bill at the last session of parliament. I had endeavoured to cover those suggestions, but the officials think that the words I have used are not sufficiently clear and comprehensive. I have consulted with the clerk of the house who is of the opinion that before second reading the bill might be reprinted in due course. I thought I had better mention it to the house and ask leave to have the bill reprinted, with the modifications deemed necessary by the officials of the Department of Justice, in order to bring its items fully, definitely and concisely before the house on the second reading. There are no changes in the explanatory notes.


Right Hon. ERNEST LAPOINTE (Minister of Justice):: I am sure there will be
no objection to giving unanimous consent to my hon. friend for the reprinting of this bill.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved for leave to introduce Bill No. 53, to amend the Foreign Insurance Companies Act, 1932.
He said: The amendment is a minor one for the purpose of permitting the classes of investment under this act which by amendment last year were permitted under the Canadian and British Insurance Companies Act.
Motion agreed to and bill read the first time.

Questions

[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved for leave to introduce Bill No. 54, to amend the Canadian and British Insurance Companies Act, 1932.
He said: The same explanation applies to this bill.
Motion agreed to and bill read the first time.


[Stage Direction]
Bill No. 45, for the relief of Gertrude Saul Baker-Mr. Walsh.
Bill No. 46, for the relief of Mary Frances Todd Lister Cardwell.-Mr. Heaps.
Bill No. 47, for the relief of Herbert John Butler.

Mr. Walsh.
Bill No. 48, for the relief of Anna Lasnier Blain.-Mr. Tomlinson.
Bill No. 49, for the relief of Annie March Breakey Coburn.-Mr. Macdonald (Brantford City).
Bill No. 50, for the relief of Mabel Gertrude Marks Lamoureux.-Mr. Factor.
Bill No. 51, for the relief of Earl Keith Drennan.-Mr. Bercovitch.
Bill No. 52, for the relief of Per Ernst Martinsson.-Mr. Thompson.

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

Mr. BARBER:: 1.	Did the government undertake any work at the Collingwood (Ontario) harbour during 1938?
2.	If so, what was the nature of such work?
3.	What was the cost of such work?
4.	Were tenders called for such work?
5.	If so, was the lowest tender accepted?


Mr. CARDIN:: 
*LIFE INSURANCE-MEASURES OF SUPERVISION
Mr. CHURCH:: 1.	What measures is the government taking to control the high cost of life insurance and of premiums paid by policy holders in view of
the rapid strides made in preventative medicine and hygiene, thus increasing the life expectancy; and also in view of the large profits and huge reserves built up by these companies so as to protect the insured and also reduce the great cost of life insurance to the public?
2.	What control is there now over investments of life insurance companies in common stocks: (a) in Canada; (b) without Canada?


Mr. DUNNING:: This is a question which certainly goes beyond the rules in the nature of the question itself. I would ask for your honour's consideration.


Mr. SPEAKER:: I think that this question should be dropped, in view of standing order No. 44, which prohibits the making of statements of fact.
Question dropped.


JUDGE BRUNEAU, RICHELIEU, QUE.
Mr. PELLETIER:: 1.	Since what date has Judge Bruneau, of Richelieu, Quebec, been in receipt of a pension?
2.	What is the amount paid annually to the said judge?
3.	Has the government been informed that the said judge has been living in Paris for many years?


Mr. DUNNING:: 1.	April 1, 1928.
2.	$6,000.
3.	Yes-pension cheques cashed in Paris.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. CHURCH:: 1.	What action is the government taking with regard to the high interest rates on mortgages on real estate, amounting to usury over a number of years by federal companies and British and foreign companies doing business in Canada?
2.	What inspection or control does the government exercise over them: (a) by the Usury Act; (b) the Interest Act; (c) the companies or other federal acts?


Charles Avery Dunning: With reference to this
question, I am afraid that it infringes in two particulars the rules of the house, in that, in asking a question, it makes statements, and in addition asks for a statement of government policy. If, however, the hon. member will agree to its being passed as an order for return, subject to the reservations I am making, we might endeavour to get such information as is asked for in the second half of the question, although I am not aware of the existence of an act called the usury act. The other acts may be searched in order to give him the information, as an order for return, subject to these reservations.
European Situation


Mr. CHURCH:: Will the minister not allow these rate questions to be considered by the banking and commerce committee for their action?


Charles Avery Dunning: Well, that is not my
business.


COLDBROOK, N.S., FISH HATCHERY
Mr. BROOKS:: 1.	Has the dominion government during the last three years constructed a fish hatchery or rearing pond at Coldbrook, Kings county, Nova Scotia?
2.	If so, from whom did they purchase the land, and what was the price paid?
3.	What was the total cost of construction of buildings, and was the work performed under contract or day labour?
4.	If under day labour, will a copy of the payroll be tabled?



EUROPEAN SITUATION


[Stage Direction]
On the orders of the day:
Hon. R. J. MANION (Leader of the Opposition) :: On Monday last, when we were discussing international affairs, I asked the Prime Minister (Mr. Mackenzie King) regarding an item which appeared in a newspaper, and which he said he also had seen, with respect to Mr. Massey not having attended a meeting in London called by the dominions office. At that time the Prime Minister said he had no knowledge of the matter. Has he obtained any since with regard to it?


Right Hon. W. L. MACKENZIE KING (Prime Minister):: May I say to my hon. friend that I also saw another item which stated that Mr. Massey had been at a conference at 10 Downing street. Both accounts were erroneous. Mr. Massey was asked to meet with the high commissioners of the other dominions not at 10 Downing street but in conference with the Secretary of State for the Dominions. He was present at that conference with the other high commissioners.


Robert James Manion: So the item is wrong.



UNEMPLOYMENT


[Stage Direction]
On the orders of the day:
Thomas Langton Church: I should like to call the attention of the government, in the absence of the Minister of Labour (Mr. Rogers) to a matter of emergency. It relates to two thousand transients, mostly young men, six hundred of whom are housed and have beds in the coliseum at Toronto and the rest

in other hostel places in the city. Notice has been given by the province to the city that their meals, two a day, are to be cut off a week from to-morrow night, March 31, The minister said that this transient question was a matter for the province. I should like to ask the government if someone will be sent from the Department of Labour here to Toronto to negotiate with the province and the city so that these two thousand men will not be left to the city and the charity of private persons.


William Lyon Mackenzie King: I will see that the request of my hon. friend is made known at once to the Department of Labour. He will doubtless get a reply in due course from that source.



WAYS AND MEANS


[Stage Direction]
The house in committee of ways and means, Mr. Sanderson in the chair.
On schedule I:
Customs tariff-415b.	Washing machines,
domestic, with or without motive power incorporated therein; complete parts of washing machines: 25 per cent.
Thomas Langton Church: I was speaking on this item the other evening when the committee adjourned, two or three minutes before the six o'clock hour. I would have finished had I been given the opportunity. The item was not carried. I have no wish to embarrass the minister, but I want to lay some facts before him and his tariff experts regarding the use of electricity in various forms of equipment which has grown out of the rapid expansion of the hydroelectric industry in Ontario. For example, we have item 415a-which was not carried- refrigerators, domestic or store, completely equipped or not; one is electric, the second is other than electric. The other evening the minister gave some explanation of this particular item, and I just wish to refer for three or four minutes-


The CHAIRMAN:: Order. I would remind the hon. member that the item under consideration is 415b.


Charles Avery Dunning: The same thing. It is all right.


Thomas Langton Church: The item, (a) as I understand it, is refrigerators.


Charles Avery Dunning: No, washing machines.


Thomas Langton Church: We might as well not carry on at all if a member cannot ask a question of the government. It is all the

Canada-United States Trade Agreement
same item. The government is not objecting to this. What are we here for? Regarding these refrigerators, washing machines and sewing machines, I put down a resolution, at the opening of parliament, regarding these matters, and asked what the tariff board was doing about the cost of the various items of equipment referred to it, and we heard that they had not had a sitting for very nearly a year. Then they met.
As has been said, there has been a rapid expansion of this industry. Prior to 1935 the tariff was forty per cent. Under the agreement in 1935 with the United States it came down to thirty-five per cent. Immediately imports from the United States went up, and the figures I have show that they increased from $189,000 to $893,000, or five times as much as they were before. The point I wish to raise, and I might just as well finish in one short speech what I have to say with reference to five or six of these items which relate to all kinds of electric equipment, is this. We have in Canada 42,000,000 horse-power, only one-sixth of which, or seven million, is developed, and some of that only for part of the year. This is a new and struggling industry, applying direct current for the use of all kinds of household equipment, and getting the benefit of cheap power for domestic use. Formerly a large part of the electrical equipment now manufactured in Canada came from Germany, but the industry for years made, and is making, a great effort to establish itself in this country by a little protection. It is a struggling industry, only in its infancy, and I submit that everything possible should be done to encourage it with a view to providing more employment. I realize quite well how desirable it is that housewives and people generally should be enabled to make use of electrical power at low cost for equipment and service in their homes for refrigerators, washing machines and other necessary devices. It is in the interests of the consumers that these things should be provided at reasonable cost, but at the same time I trust that the employment feature and the need of helping home industries will not be overlooked by the government. Rapid strides are being made in the extension of the use of electricity in connection with medicine, health, and all kinds of home comforts, and in other lines, and I do suggest that the government should help to put the industry on its feet and expand it. We cannot visualize the extended use of electricity in the future in the kitchen and in other parts of the house and domestic industry. I have figures which I could submit to the committee but I am
afraid it would not be possible to give them at this stage. This industry is operating in Hamilton, Peterborough and other parts of Canada, and the figures which the minister gave the other evening will show its importance.
Our imports of electrical refrigerators alone from the United States, for the last year, were $950,000 and of other refrigerators $245,000. The numbers imported from the United States were 14,894, and 4,049 respectively. We exported 7,000, our largest customer being Australia with the United Kingdom second. These figures alone show what can be done in this industry not only in connection with refrigerators, but in the production of other electrical equipment as well. The electrical equipment industry is in its infancy and with proper development it could be made a fertile source of employment. The use of electricity will in the future be applied in fields of activity which at present we do not visualize, providing employment for Canadian workmen, and assisting in production and distribution and agriculture. The member for Victoria-Carleton referred to this subject the other evening. There is no doubt a demand on the part of the public to have these inventions made available at cost plus a reasonable profit, and I suggest that the minister should have someone, either in his office or in the office of the tariff board, determine a price that would allow a reasonable profit to the manufacturers and at the same time promote production at reasonable cost in Canada and thus help employment. I hope there will be no further reductions until this great industry is well established, because I am sure it could be made to provide employment for thousands of Canadians in the provinces that use commercial and domestic power extensively as well as throughout the dominion in the use of domestic electrical equipment.


Mr. McDONALD (Souris):: I wish to call the attention of the Minister of Finance to the price of washing machines. In my opinion this is an item that should be referred to the tariff board. Last summer I made inquiries regarding comparative prices in the United States and Canada, and I also investigated the small combination gasoline engine and washing machine. There are only two or three companies in the United States that make these small gasoline engines, which work perfectly with washing machines. We have to import them. The duty under this item is 25 per cent, but I can state on reliable authority that a better washing machine can be bought in the United States at half the price we have to pay in Manitoba. That difference of
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Canada-United, States Trade Agreement
100 per -cent is too much money. We have no objection to a certain amount of tariff protection for the benefit of Canadian workmen, but 100 per cent is altogether too much. I should be glad to have the item referred to the tariff board.


Mr. FURNISS:: 
Mr. MARSHALL:: I note that there is a 20 per cent British preferential tariff, and 25 per cent United States. Will the minister give the imports from Great Britain and from the United States? Perhaps he can also give us the figures covering the total quantities manufactured in Canada in 1938.


Charles Avery Dunning: There were no imports; from Great Britain; in fact we export washing machines to Great Britain. The imports from the United States amounted to $702,000-last year.
If I may say a word in reply to the two hon. members from Manitoba who have spoken, I would say that the record before me shows that there has been quite an increase-in the imports of washing machines since the 1935 agreement, which, it will be remembered, reduced the duty from 35 per cent to 25 per cent. With the coming into full operation of this agreement the present effective rate of 28 per cent, including excise tax,, will of course be reduced to 25 per cent. But I call attention to the fact that during: the three years 1936 to 1938 inclusive, imports did increase from $272,000 to $702,000. They trebled in value. The number of machines-imported increased five-fold during that period. I shall, however, take note of the-representations that have been made suggesting that a tariff board inquiry might be desirable. I do not undertake that such a reference will be made, but the matter will' be looked into from that point of view. At the present time we have quite an export business; exports have grown as rapidly as; the imports. Last year we exported a total of $1,481,000 worth of washing machines, the great bulk of which went to the United Kingdom, Australia and New Zealand. I shall take note of the suggestions made by my hon. friends and find out what the facts are.


Mr. STEVENS:: The statement of the % minister that a reference in this matter might, be made to the tariff board impels me to say that while I have all the sympathy in the-world with the representations made by the two hon. members who have spoken on the-subject, there is another side to the story to which I think I should refer. If a reference-is made to the tariff board, obviously both sides will be heard.
The washing machine industry in the United States is not in a prosperous condition. As far as the story can be gathered from the financial reports of these companies -there are not many of them, but their output is very large-it is not a very attractive one. As a result some of these companies; are actually dumping machines in Canada in order to keep up production and keep down the overhead ratio. That at any rate is what is claimed, and I think there is sufficient evidence to support that view. Briefly stated, the washing machine manufacturers of the United States produced in 1938 about 1,200,000 washers. Yet it is clear from their annual statements, some of which I have seen,.

Canada-United States Trade Agreement
and from information which I consider to be reliable, that the industry not only did not make any money but lost heavily. For instance the Automatic Electric Washer Company, of Newton, Iowa, producing about 30,000 machines a year, in their report showed a loss of $105,000, or approximately $3.50 per machine.
It might also be pointed out that these companies have different grades of machines. They put out a higher priced machine, which is the most profitable type, and which they seek to sell in their own market; and besides that they produce a low priced machine which they can feature in their advertisements to attract buyers. Most of these companies limit the number of low priced machines to a small percentage of their output. I understand the large General Electric Company limit the number of low priced machines to fifteen per cent of their total output. These low priced machines are used as loss leaders. It is also reported that the Easy Washing Machine Company, a well known company over there, lost something in the neighbourhood of $400,000 last year. Their annual production is about 200,000 machines. They make a range of machines selling from $49 to $150.
Another feature of this operation was referred to a moment ago, the attachments, such as electric motors and the tubs, which are usually manufactured separately. It is reported that the manufacturers of washing machine tubs lost on an average about fifty cents a tub last year, and the manufacture of the motors is also reported to have shown a loss.
The Washing Machine Company of Fairfield, Iowa, make a machine selling at $39, but they limit the production of those machines to one hundred a year; and while the company advertise machines ranging in price from $39 up to $100 or whatever the top price may be, the salesmen would be pretty severely taken to task if they placed many of those $39 machines. They are told they can show it, but to advise the purchase of a higher class machine.


Charles Avery Dunning: If the company produced only one hundred, they would not be of much use for any purpose.


Henry Herbert Stevens: No, except for advertising-that they make a machine at that price. But the salesmen were instructed that their efficiency' would be judged by the small number of that class of machine that they placed.
A further point is that certain of these machines have been shipped into Canada at an invoice price of $24.


Charles Avery Dunning: Out of the hundred?


Henry Herbert Stevens: Well, there may have been some of that class. As near as can be ascertained, these machines cost about $34.
I do not say it in any critical sense, but one of the questions which ought to be examined is whether there has not been systematic dumping of lower priced machines on the Canadian market, tending to destroy the industry here.
There is another aspect of this matter which should also be remembered. Usually these low priced machines are in the long run more costly than the higher priced machines-not those at the highest prices, but those moderately priced. A machine selling at what we might call a normal price will usually last a considerable time, being fairly well made, so that the actual annual outlay by the purchaser is comparatively small. Of course they are usually sold on time.
While I am entirely in accord with the view that we should secure for the users of this class of household utensil as low a price as we possibly can, yet in the interest of common sense and the welfare of the industrialists of Canada, which after all is very important, we must not allow ourselves to become the victims of a sort of "loss leader" dumping practice on the part of our friends south of the line. The evidence is pretty clear that the industry in that country has been in a somewhat unprofitable condition for the last few years, and because of that fact there has been a tendency to slash prices.
I think there is one thing that can be definitely said for the Canadian manufacturers of washing machines, that as far as I know-and I know some of them-they have all been putting out excellent machines, supplying the Canadian market at reasonable prices. The value of this industry, together with similar industries, is undoubtedly great, and I must repeat what has been said by some other hon. members during the last two or three weeks in discussing these resolutions as well as in connection with other matters, that after all the value of the industrial market to the farmer is important. I would suggest to my hon. friends who advanced the argument a few moments ago, that the real approach to the problem of the farmers is to secure for them a fair price for their products, which they are not getting to-day. That is my confirmed opinion. I think we will have a much healthier economic condition among the farmers of Canada if we can devise a system under which we can stabilize at a fair level the prices received by the farmers for their products, and I am now speaking particularly of live stock, dairy products and, of course, all grains.
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Canada-United, States Trade Agreement


Mr. McNEVIN:: Would the hon. member inform us what method he would follow in order to attain that end?


Henry Herbert Stevens: I think such a dissertation now would be out of order, but I am not unmindful of the point and am quite prepared to express my views at the proper time, because I have given the question a great deal of thought. At the moment I am merely giving, shall I say, the other side of the story, which we must constantly bear in mind. It would not be fair to put the minister in a position in which in a sense he would be resisting an appeal in the interests of the farmers of Canada, which is virtually the position in which he was placed. As far as I am concerned I certainly wish to uphold the demands of agriculture for better and fairer treatment, yet nothing is gained by glossing over the other side of the picture or, merely for the sake of some momentary encomiums from that quarter, neglecting to tell what are the facts. So I suggest to the minister that when the matter goes to the tariff board-


Charles Avery Dunning: I did not say it would.


Henry Herbert Stevens: If and when it goes to the tariff board, both sides of the story should be heard.


Mr. COLDWELL:: There have been a number of items upon which I should have liked to say a word, but since this one has aroused some discussion I want to support those who have suggested that such articles as washing machines should be referred for investigation to the tariff board, or that something definite should be done by the government to reduce the duty. If an investigation of this kind be undertaken, I suggest to the minister that since we export a considerable number of these machines to Great Britain, a comparison should be made between the prices of such articles in Great Britain and in Canada. There may be very little difference, but sometimes on picking up English publications we find articles with which we are familiar in Canada advertised at prices which seem to be in line with our own prices or sometimes even a little less.
As one who occasionally passes through the United States I must say that I do not know of any group of articles upon which the differential appears to be as great as between the two sides of the line as electrical appliances and articles of this description. What the hon. member for Kootenay East (Mr. Stevens) has said may be quite true, but I have always been struck by the tremendous difference between the prices of refrigerators, electrical appliances, washing machines and so on. Some twelve or thirteen years ago we

bought a washing machine made in the United States, for which we paid something in the neighbourhood of $160. In store windows across the line I saw the very same machine for sale at less than $100. That struck me at the time as being a tremendous difference in price.
While it is true that the manufacture of such articles means work for those engaged in Canadian factories, I sometimes wonder whether we are not paying far too great a price for the work that is distributed by industries of this description. I think if an industry is uneconomic and is robbing, as it were, a large consuming public in this country, it has no right to receive special consideration.


Mr. HOMUTH:: Would wheat come under that?


Major James William Coldwell: No; wheat does not
come under that, for reasons which we shall probably discuss within the course of the next few days.	*
To-day throughout Canada there are thousands of people who lack many simple household utensils. Very many articles have been discussed in connection with this treaty which cause me to say that we should do everything we can to bring into effect what after all is the Liberal policy, as stated over and over again in the program of the Liberal party ever since 1919; that is, to remove the protective tariff from articles which are necessary to the general welfare of the family. I am rising simply to give perhaps still another side of the picture and to suggest to the minister that he give consideration to the request of the two hon. members from Manitoba who have spoken.


Mr. DEACHMAN:: I am quite certain
that everyone in what is commonly called the rump, as well as those on the main street of the Liberal party, will accept the suggestion of the hon. member for Kootenay East (Mr. Stevens) that we should do everything possible to safeguard the industrial producer and the industrial worker in the Dominion of Canada. But there is some variation of opinion as to what constitutes the best method of helping him. The items we have been discussing recently concern largely iron and steel. I am not particularly interested in this individual item, but looking at the matter from a broad national standpoint I am anxious that the iron and steel industry in Canada should prosper. I looked up the figures in order to see what we have been doing in the last few years, and I bring a message of cheer not only to the hon. member for Kootenay East but to all those on my immediate left who are particularly interested in this problem.

Canada-United States Trade Agreement
In 1933 our production of iron and steel products was 8211,000,000. Those figures have increased year by year. The following year they were $308,000,000, and in the year the Liberals came into office and started to "ruin the industry" they were $390,000,000. The following year they were $453,000,000 and the next year $623,000,000. I do not hear a word of cheer from my friends to my left, although from time to time they have told us that the approach of the Liberal party to office always meant the retreat of industry.
Let me deal with wages, which, in my opinion is a very important factor. They moved up from $69,000,000 in 1933 to $88,000,000 and then to $110,000,000. We, the Liberals, arrived on the scene, and the figures were $126,000,000, $164,000,000-and still the cheering opposition army is silent; nothing but criticism! Then, how many men were employed? In 1933 there were 70,000; then 81,000, 95,000, 107,000; and the army of workers who marched into the iron and steel factories of Canada in 1937 numbered 127,336. Leaving out war years, that level was never touched, except in one year, 1929.
In 1929 production of iron and steel products stood at $738,000,000. We have not equalled that figure so far, but we are closely approaching it, with the $623,000,000 of 1937. In addition it must be remembered that there was, or should have been in the period of 3'ears from 1929 to 1937, at least to some extent a decline in price levels. So that if we could make the comparison on the basis of actual volume, rather than value, we would see that we have almost approached the highest limit we have ever reached in any peace year.
I should like to touch upon another item. My hon. friends are always afraid of imports. Well, in the year in which imports were shut out to the greatest extent, that is in the year 1933, when they fell to a value of $58,000,000, we were producing only to a value of $211,000,000. In 1937 we were importing goods to the value of $150,000,000 and producing them to a value of $623,000,000. So that it seems that as imports grow, so also does production; and industry moves forward as we break down the barriers, just as will the other sections of production in Canada.
The hon. member for Kootenay East referred to dumping. I think someone should offer a prize for the production of a genuine case of proved dumping. I sat and listened before the tariff board, year after year to- I forget how many cases, it must have been about two hundred-and I heard charges and counter-charges made in regard to dumping. The only cases I can recall which seemed reasonably clearly proved were ones in which 71492-137
Canadian manufacturers were exporting abroad at prices lower than they charged at home. No one offers to bring forward the evidence, but when you want to paint the picture of dumping it is the easiest thing in the world, if you are inclined that way, to splash on a ten-league canvas, with brushes of comets' hair. But, after all, if we are going to extend industry in Canada it must be brought about by bringing the products we produce within the capacity of the people of Canada to purchase.
I am quite interested in the statement of the hon. member for Kootenay East. Price policies and production have been clearly discussed in a recent book put out by the Brookings Institution of Washington. I ordered a few copies the other day, and out of kindness to my hon. friend, and the high regard 1 have for him not only because of his interest in this but in other problems, and in his to-day professed interest-I know it is real- in agriculture, I propose to make him a present of a copy of the book, in the hope that he may be converted to that point of view, and that I may have the pleasure of saving at least one brand from the burning.


Mr. MacNICOL:: May I bring the committee back to the item under discussion.


Charles Avery Dunning: Thank you, sir.


John Ritchie MacNicol: I suggest if hon. members who deal with millions and twirl them around their tongues so easily in committee, without understanding their application, would confine their remarks to item 415b, we would get much farther ahead.
I wish to make only one observation on behalf of the worker in industry-because somebody has to say a word for him. We have heard something about the farmer, and we have had the economist tell us something which perhaps none of us knows anything about-and perhaps he knows no more-


Charles Avery Dunning: That word should be
expunged-accusing the hon. member of being an economist 1


John Ritchie MacNicol: I am always pleased
to hear the hon. member for Huron North (Mr. Deachman) dealing in millions. Under the 1935 treaty the duty on washing machines was reduced from 35 per cent to 25 per cent. In the calendar year 1935 Canada imported 3,380 washing machines.


Charles Avery Dunning: 3.580.


John Ritchie MacNicol: I am speaking of the
calendar year, and I am giving the figures supplied by the washing machine industry.

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In 1938, 16,914 machines were imported. Certainly there must have been a considerable reduction in employment.


Charles Avery Dunning: Now, give us our own
export figures, and that will demonstrate my hon. friend's point.


John Ritchie MacNicol: I know they increased.
We would not be able to export at all if we were not able to manufacture for our own market. We would be able to export more if we had the whole of our own market. But I wish to point out that according to the figures supplied by the washing machine industry, 309 fewer men were engaged in the industry in Canada in 1936 than in 1935.


Mr. MACDONALD (Brantford City):: It has been suggested by the hon. member for Souris, and to some extent by the hon. member for Muskoka-Ontario (Mr. Furniss) that washing machines were selling in Canada at twice the price at which they were selling in the United States. The hon. member for Kootenay East (Mr. Stevens) suggested that they were being dumped into Canada. Now, if they are being dumped into Canada one would think that they were being sold in this country at a price lower than that at which they were selling in the United States. The two views conflict. Both conditions can hardly prevail.
It has been suggested that there is such a duty on washing machines that they are being sold at an excessive price in Canada. The hon. member for Kootenay East quoted figures which indicated that companies in the United States had lost money. I believe if that point were followed out he would find that, generally speaking, the washing machine companies in Canada also lost money last year. There might be an exception here and there, but, generally speaking, the washing machine industry last year was not productive of profit. There are a considerable number of companies in Canada making washing machines, so that there is a good deal of competition in our own country. There is competition among the companies themselves, and that naturally keeps the price down. No company in Canada has what one might call a monopoly.
It has been suggested by several hon. members that this matter should be referred to the tariff board. My opinion is that at the present time we must give industry confidence. We should let them know that they are going to be allowed to carry on their business, without too much interference from governments or other authorities. I would say that this great industry is not one which should be scrutinized by any board. It should be

given an opportunity to conduct its business free, from interference. If that is done I am satisfied that the people will get their washing machines at a fair price.
It has been said that we want to get washing machines as cheaply as possible, and I agree with that; the women on the farms and the mothers and housewives in our cities should get these machines as cheaply as possible. But if we are going to destroy this industry, if it is put out of business and all these machines are to be brought in from a foreign country, I ask where the husbands of the housewives are going to get the money with which to buy them? I submit that we must consider the whole question of industry. Are we going to encourage industry in this country or are we going to destroy industry and create more unemployment? Our one thought should be to be fair to all, to give our housewives whether living in the city or on the farm, washing machines at a fair price; 'but at the same time we should protect this industry and keep our working men at work.


Karl Kenneth Homuth: I want to congratulate my hon. friend (Mr. Macdonald), who is a neighbour of mine, upon his protectionist speech. Every time an item in this trade treaty is discussed and hon. members refer to the price they have to pay, they refer to the retail price. Member after member has risen to condemn industry. Our manufacturers have 'been called profiteers and hon. members complain of the high prices they have to pay for commodities. But it is not industry that is making the money out of these things. Take washing machines, for instance. If you follow the price of a washing machine from the factory until it reaches the consumer you will find that thirty, thirty-five, forty and forty-five per cent has been added to the price received by the manufacturer. Surely it would be better to spend our time in trying to work out some method of cutting down the cost of distribution in this country than to criticize industry day after day as it has been criticized. I agree with the hon. member for Brantford, when he says that industry should have some assurance that it will not be continually interfered with. Industry certainly has no such assurance now.


Mr. NEEDHAM:: The minister said that exports had increased five times and that there had been a tremendous increase in the imports. Would all these exports be of Canadian manufacture, or would some be imported and then exported?


Charles Avery Dunning: Our exports to the various countries of the empire are required to meet

Canada-United Slates Trade Agreement
the British content regulations of the country to which they go. The imported and reexported article must comply with the British content regulations of Great Britain, Australia or New Zealand, as the case may be. In the case of this particular article, our exports comprised at least fifty per cent British content.


[Stage Direction]
Item agreed to.
Customs tariff-415e.	Clothes wringers,
domestic, and complete parts of metal thereof: 25 per cent.
Item agreed to.
Customs tariff-415d. Sewing machines, with or without motive power incorporated therein; complete parts of sewing machines: 15 per cent.
Item agreed to.
Customs tariff-422a, ex 439b and ex 427a. Concrete road-paving machines, self-propelling, end loading type, with a capacity of 21 cubic feet of wet concrete or more; concrete and asphalt road finishing machines; form graders; sub-graders; combination excavating and transporting scraper units; concrete mixers, transit type; dump wagons or trailors on crawler-tracks, not self-propelled; back-filling machines and equipment, mounted on self-propelling wheels or crawling traction, semi- or full-revolving boom and scraper type; steam or air driven pile hammers or extractors; well-points; truck turntables; all the foregoing of a class or kind not made in Canada, and complete parts thereof: 10 per cent.
Mr. BROWN:: What is the rate of duty on these items entering the United States?


Charles Avery Dunning: The hon. member is referring to road building machinery?


Albert A. Brown: Yes. Could the minister also give the Canadian imports?


Charles Avery Dunning: The United States duty on most of this item is 274 per cent. The imports to Canada last year were valued at $366,000.	[DOT]


Albert A. Brown: What would be the value of machinery of this type, otherwise provided for, produced in Canada? I mean all other kinds that are made in Canada.


Charles Avery Dunning: There is no production of this item in Canada.


Albert A. Brown: I know that. But there are items of this type which are made in Canada.


Charles Avery Dunning: There is no specific item which covers the same range of articles produced in Canada as is covered by this item. They would be distributed over possibly half a dozen different items in our tariff schedule. I regret I have not the precise information covering the Canadian production.


Albert A. Brown: Would it be safe to assume that the tariff duty is higher on the class of goods which are made in Canada?


Charles Avery Dunning: Oh, yes.


[Stage Direction]
Item agreed to.
Customs tariff-424a.	Hand fire extinguishers, and sprinkler heads for automatic sprinkler systems for fire protection: 30 per cent.
Item agreed to.
Customs tariff-ex 425. Lawn mowers designed for use with motive power, whether or not containing the power unit: 15 per cent.
Item agreed to.
Customs tariff-427. All machinery composed wholly or in part of iron or steel, n.o.p., and complete parts thereof: 25 per cent.
Mr. HARRIS:: Could the minister give us the imports and exports of items 427 and 427a, which I think go together?


Charles Avery Dunning: The imports of items 427 and 427a in 1938 were valued at $21,883,000, while our exports totalled $4,003,000. I am advised that it is not possible to segregate the data covering the Canadian production of the exact types of machinery covered by the item, inasmuch as they would be included in a number of different classifications. The United States duty on machines not otherwise specified, which is the nearest corresponding item in their tariff, is 274 per cent. That United States rate is subject to numerous specific reductions under various trade agreements.


Joseph Henry Harris: This is a very large item, and the three per cent excise tax will represent a substantial amount of revenue which we will not receive. That is a point which ought to be borne in mind. In 1935-the minister will correct me if I am wrong-the imports into this country were only $7,400,000. In 1938 they were $21,883,000, representing a threefold increase in respect of machinery and parts of a class or kind not made in Canada, some of which could very well be made in this country. Recently a number of hon. members had an opportunity of looking over the plant of the John Inglis Company in Toronto. Of the machinery represented in this $20,000,000 item, at least one-half, I would say, could be manufactured in a plant of that type. I know from practical experience that it consists of large and heavy units which are used in mining and many other industries, most of the units being driers and pressers and the types of machinery which require boiler shop work-jacketed vessels, stay bolted tanks, machines built on what is known in the trade as marine construction. Prior to
2178	COMMONS
Canada-United States Trade Agreement
the building back in 1921 of the large unit of the John Inglis Company Limited it was difficult to have these heavy units of machinery made in Canada. They equipped that very expensive plant to turn and twist, as it were, steel sheets as heavy as seven-eighths thickness. The hon. member for Huron North (Mr. Deachman) will realize that that is an extremely heavy sheet to stay-bolt and roll and make into heavy machinery. Since they were unable to compete with similar plants in the United States, and since the demand in Canada during the depression was not so heavy, that plant finally went out of existence.
I use that as an illustration of the type of plant which has gone out of existence or has very considerably reduced its production. The same is true of a plant at Galt, one at Montreal, and one out Welland way: they all experienced the same difficulty. But the point I want to bring out is rather in contradiction of what we heard a few moments ago from the hon. member for Huron North. In departing from the Fielding idea of a revenue tariff as I heard that minister explain it on many occasions from the government side of the house, they have reduced the duties to a very low level, as low in this case as -ten per cent on goods of a class or kind not made in Canada. The result is that plants of this kind, if presented with a blueprint of a heavy type of machinery which is not produced here, are discouraged by the fact that the tariff is only ten per cent, whereas if they were in production on that kind of machine the duty would be 25 per cent. Every time you enlarge the spread between machinery of a kind that is made in Canada and machinery of a kind that is generally not made in Canada, you lose the revenue from tariffs-imposed on a principle which as I have always understood is part and parcel of the policy of the Liberal party, That is the first thing that happens. Secondly, you restrict the possibility of our manufacturers in the iron and steel industry producing that unit of machinery. By the way, industries such as the John Inglis Company did almost as much business, in dollar value, in machinery specially designed as in ordinary boiler shop work.
A word with regard to the employees. I imagine there are hon. members in this ' chamber who know something about the technical employees engaged on these very large units of machinery; I am thinking of processing machines which weigh twenty, thirty and forty tons. We have in Canada men who were apprenticed in the iron and steel industry on the Clyde, men who learned their trade and craftsmanship there, and

men who were apprenticed in Belfast, where I believe the Brown yards employ eight or ten thousand men.


Mr. McLEAN (Melfort):: Harland &
Wolff.


Joseph Henry Harris: They came to Canada and found their vocation in industries of a kind which are supplanted by these imports which have jumped from $7,000,000 in 1935 to $12,000,000 in 1938. These artisans from Belfast and the Clyde, who learned their trade from the ground up, are to my mind the most efficient mechanics that civilization has yet produced.


Charles Avery Dunning: Some good ones come
from Yorkshire.


Malcolm McLean: What about the Tyne?


Joseph Henry Harris: I am thinking of a man named Spence-a good name for a York-shireman-who was with me for some thirty years. He was trained as a mechanic in manufacturing machines used in the textile trade, but he could not find employment in this country with industries producing textile machinery, and now, instead of applying his artisanship in the manufacturing of textile machinery of the kind or class comprised in this item, he is a night watchman in a plant which I happen to control.
I do not know where the hon. member for Huron North got the astronomical figures he cited with regard to iron and steel, but I suppose they were from the bureau of statistics. It is a handy place, and you can prove almost anything. But my information is that the number of employees normally engaged in the Canadian iron and steel industry is about 131,000. With the collapse in 1929 it dropped down to as low as 77,000. Then it came back to 99,000. At present, as hon. members will agree, it remains stagnant, and page 12 of the employment commission report covering the employment comparison, net change between September 1929 and 1936 in that particular industry, shows that there are 35,883 iron and steel workers out of employment. My hon. friend will agree with me, I am sure, that there is a great deal of work and wages in $21,000,000 worth of machinery and machine parts as represented in this particular item. A hurried mental calculation would lead one to suggest that there are involved at least $5,000,000 worth of wages. So that if our friends who are in power, and who want a tariff for revenue purposes, would adhere to their policy and discontinue widening that spread between goods of a kind made in Canada and goods of a kind not made in Canada, in my opinion

Canada-United States Trade Agreement
a great many of our present industries who diversify their manufacture of machinery of this kind could keep their staffs busy designing and building these machines.
The committee realizes that in any industry the machinery changes every two or three years. The ordinary half-million dollar plant would have $200,000 worth of machinery, and it cannot be used for ten years because something more modern and efficient keeps coming up all the time and the old machinery has to be scrapped and modem equipment installed. These new machines are produced in the large countries such as the United States, some in England and some on the continent; so that the Canadian manufacturer may be producing a machine called by one name to-day, which is replaced by a machine called by another name to-morrow, which is doing the work far more efficiently and quickly, with the result that the manufacturer has to throw out the old machine at present made in Canada and bring in the new unit not made here. The artisans of Canada, if they had a look at the blueprints and had a chance to study them, if they were not faced with this widening of the spread, could in many instances produce the machinery here and expand employment to our own people. I hope that in that respect our friends will get back to the field of tariff for revenue.


Albert A. Brown: May I refer to an observation made by the hon. member for Danforth (Mr. Harris). I would point out that the reduction from 20 per cent to 10 per cent is just sufficient to induce the United States manufacturers who have branches here, and who are the sole manufacturers of certain machinery, to discontinue making such machinery here, so that it might be brought in under the 10 per cent tariff. In other words this reduction offers an inducement to United States manufacturers to quit manufacturing here and to manufacture in the United States.


Charles Avery Dunning: The hon. member for
Hamilton East (Mr. Brown) raises an interesting point. It is true that in this basket item of machinery not otherwise provided for, which is a very large one, there is a reduction from 20 per cent to 10 per cent. I know of nothing on which Canadian industrialists in all lines make stronger representations than they do with respect to the tariff on classes of machinery, capital goods, which they require in industry and which are not made in Canada. We are constantly in receipt of protests against what the hon. member for Danforth would call a revenue duty on capital goods required in industry and not made in Canada. We have recognized the situation to the extent of the reduction embodied in the present treaty, and of course we have to take into account the very point made by the hon. member for Hamilton East. Shall we, by so doing, bring about the removal of some concerns that were manufacturing in Canada because of the differential? The information we have is that such a result is extremely unlikely to any considerable extent.


Albert A. Brown: The circumstances which
I have stated actually exist at the present time; and I will go further than that. There are certain manufacturers who wish to bring in machinery under the 10 per cent provision and they are exerting pressure on the manufacturers who produce that kind of machinery to stop making it so that the machinery may be imported under the 10 per cent duty.


Mr. ILSLEY:: Will the hon. gentleman give me the particulars? I am most interested.


John Ritchie MacNicol: I wish to say a word or two in connection with item 427a. I have in mind a plant in Toronto which manufactures a good deal of the machinery that comes in under item 427a, under a duty now of 10 per cent.


Charles Avery Dunning: They cannot be manufacturing machinery that comes in under 427a, because 427a applies only to machinery not made in Canada.


John Ritchie MacNicol: But I am speaking of machinery made in Canada.


Charles Avery Dunning: That is 427.


John Ritchie MacNicol: Under the administration of the tariff the manufacturers are told that the machinery is not made in Canada although it is. The two ministers are here and either of them can correct me. There are two machines to which I refer. One is known as the straight line portable rotor lift gravel and rock crushing machine, and the other machine, a similar one, has an additional crusher and is called a dual purpose machine. I have pictures of them. I have seen the two different machines after they were built in the Toronto plant. If the straight line machine has attached to it the dual purpose feature it comes in at 10 per cent; if it has not the dual purpose feature it is 25 per cent.


Charles Avery Dunning: Twenty-five per cent is correct under 427.


John Ritchie MacNicol: They can turn out either of these machines in ten days. All they have to do is add the additional crusher equipment to make a dual purpose machine.
2180	COMMONS
Canada-United States Trade Agreement
But if a road builder wishes a dual purpose machine he buys it in the United States and imports it at 10 per cent duty. If he purchases a single line machine of the same order less the dual purpose part, he has to pay 25 per cent. There are two companies in Canada making those machines, one in the province of Quebec and the other in Toronto. I know the Toronto plant can, and I am told that the Quebec one also can turn these machines out very rapidly. I should like to know why the department cannot separate these machines for duty purposes. If an importer brings in a dual purpose machine, does the minister feel that the whole machine should be let in at 10 per cent? Why not separate it and collect 25 per cent on the single line part of the machine and let the dual purpose addition in at 10 per cent? This company ships machinery all over the world, including Australia and South Africa, and they could sell this line of machinery down there if they were enabled to obtain a larger part of the Canadian market. One machine weighs about 53,000 pounds, and I am told that eighty per cent of the cost is labour. That is quite an item.
I do not know how we are ever going to develop the manufacture of new lines of machinery in this country unless the manufacturer is given a chance to obtain the home market. I am told that they can and do sell these machines in Canada at the same price as that at which they are sold in the United States. But I am also told-I do not know whether this is true-that a large contractor will set up one of his employees, or someone very close to him, as an agent, and that agent brings the machine into Canada at the agent's price; in that way I presume the purpose of the act is defeated. Surely the administration would not want anything like that to take place. If the manufacturers are given their home market they can not only supply all the machines required in Canada at the United States price and create a great deal of employment in Ontario, particularly Toronto, and in Quebec province-I have . forgotten the name of the town there in which these machines are made-but can also sell them in South Africa and Australia and elsewhere to compete with the United States prices. These men seem to think that under the n.o.p. provision the machines are held not to be manufactured in Canada, because unless ten per cent of the market requirement is made here in Canada, the machine is considered as not being manufactured in Canada. But how can they get ten per cent of the Canadian consumption if the conditions prevail which I have just outlined, an agent [Mr MacNicol].
being set up to bring the machines in at an agent's price? I cannot help feeling that this is a condition which is of concern to any department interested in increasing industry in this country.
It appears to me from the way tariffs are made in Canada that we have no one particularly looking after industry, except perhaps the Minister of Finance. I should like to see him called the minister of finance and industry.


Charles Avery Dunning: I have enough titles now.


John Ritchie MacNicol: Then someone in the cabinet would be charged with looking after the manufacturer, helping him to give more employment. I believe twenty-three other countries have a ministry of industry, and it is high time this country had.
I saw one of these machines a week ago last Saturday. It is a large machine worth $23,000. It has been in stock for some time, and is likely to remain on the warehouse floor now that the duty has been reduced to 10 per cent. That machine has in its construction ninety-eight per cent of Canadian material, as well as all the labour. The tires on that machine, worth $1,500, were bought from a Canadian manufacturer, likewise the elevators, the motors and all the intricate parts that go into this machine are bought in Canada, whereas when a machine comes from the United States the tires, the elevators, the conveyors and all the rest are made there.
I am not finding any fault with what the two ministers are trying to do in the way of bringing down prices, but the time has come when at least one member of the cabinet should be specially charged with the development of industry in this country. I know of no other way by which industry can be developed more speedily than by giving attention to just such an item as I have now discussed. The companies manufacturing these machines can produce them in Canada and sell them at the same price as the United States machine, but they cannot get into the market and therefore cannot get the required 10 per cent. Give them a chance and they will take care of the requirements of the Canadian market in this line. As I have said, eighty per cent of the cost of the machine is labour, which is a very important item in providing industrial employment in Canada.


James Lorimer Ilsley: I was interested in the remarks of my hon. friend. The specific matter of which he complains is a ruling which apparently has been made by the Made in Canada branch of the customs division. From what he said I am not sure whether the ruling has been made or not. I should be very glad

Canada-United States Trade Agreement
if he would let me have particulars of the instance to which he refers, and I shall make careful inquiry. The branch has to make a great many rulings, and many of them are difficult; there are two sides to the matter in dispute. But I shall be glad to go into that particular one. It rather struck me that the hon. gentleman had made a case, but there may be other facts bearing on the situation.


John Ritchie MacNicol: Could not the two things
be separated as I suggested?


James Lorimer Ilsley: It is impossible for me to say without looking into the matter.


Mr. ROSS (St. Paul's):: Does oil well drilling machinery or apparatus come under this item?


Charles Avery Dunning: No.


[Stage Direction]
Item agreed to.
Customs tariff-ex 427. Machinery and apparatus enumerated in tariff item 412a, when for use by manufacturers of articles made from regenerated cellulose or cellulose acetate; complete parts of such machinery and apparatus, not to include saws, knives, and motive power:
5 per cent.
Item agreed to.
Customs tariff-ex 427. Veneer-drying machines, and complete parts thereof: 5 per cent.
Item agreed to.
Customs tariff-ex 427. Wire stitchers and staplers, either hand or power type, but not including motive power; complete parts of the foregoing: 5 per cent.
Mr. LENNARD:: I notice that the duty from the United States is 5 per cent and that the British preferential rate is 10 per cent. Will the minister explain that?


Charles Avery Dunning: The British rate will come down automatically, because Great Britain is a favoured nation.


Frank Exton Lennard: The 10 per cent is not correct, then?


Charles Avery Dunning: Ten per cent is the present British preference rate, but the fact that we are agreeing to a 5 per cent rate from the United States means that that 5 per cent will apply to Great Britain also in future, under the most favoured nation clause.


[Stage Direction]
Item agreed to.
Customs tariff-427a. All machinery composed wholly or in part of iron or steel, n.o.p., of a class or kind not made in Canada; complete parts of the foregoing: 10 per cent.
Item agreed to.
Customs tariff-427b. Ball and roller bearings: 17i per cent.
Item agreed to.
Customs tariff-427c. Machinery for dairying purposes, viz.:	Power churns, power milk
coolers, pow'er fillers and cappers, power ice cream mixers, power butter printers, power cream savers, power bottle sterilizers, power brine tanks, power milk bottle washers, power milk can washers; ice-breaking machines, valveless or centrifugal milk pumps, sanitary milk and cream vats; none of the foregoing machinery to include motive power: 15 per cent.
Item agreed to.
Customs tariff-ex 427a, 427e. Automatic machines for making and packaging cigars and cigarettes, not to include tobacco-preparing machines: 10 per cent.
Item agreed to.
Customs tariff-427h, ex 445f, ex 445k, ex 446a. Motion picture projectors, arc lamps for motion picture work, motion picture or theatrical spot lights, light effect machines, motion picture screens, portable motion picture projectors with or without sound equipment; electric rectifiers or generators designed for use with motion picture projectors; complete parts of all the foregoing, not to include electric light bulbs, tubes, or exciter lamps: 15 per cent.
Item agreed to.
Customs tariff-428c. Engines or boilers and complete parts thereof, n.o.p.: 25 per cent.
Item agreed to.
Customs tariff-428e. Diesel and semi-diesel engines, and complete parts thereof, n.o.p.: 20 per cent.
Item agreed to.
Customs tariff-428f.	Air-cooled internal
combustion engines of not greater than 1J h.p. rating, and complete parts thereof: 20 per cent.
Item agreed to.
Customs tariff-429.	Cutlery of iron or
steel, plated or not:
ex (g) Safety razor blades, 25 per cent.
Mr. TAYLOR (Nanaimo):: I have been
awaiting an opportunity to direct attention to an observation which I have made several times lately in connection with the tariff rate on articles imported purely for domestic consumption. The hon. member for Rosetown-Biggar (Mr. Coldwell) drew attention to the spread between prices of washing machines in the United States and those in Canada. It appears to me that the Minister of National Revenue should take into consideration the fact that a tradesman, when setting his retail price, makes a profit on the duty which he has paid the government, and on the transportation charges, consequently raising the price artificially, with the result that the spread is very much greater. If the collection of duty
Canada-United Stales Trade

Agreement
on articles for domestic consumption could be carried on as the collection of sales tax is carried on, from the retailer, it would make a great deal of difference in the cost of these articles in Canada.


Charles Avery Dunning: I did not get my hon.
friend's last question.


James Samuel Taylor: It was not a
question; it was an observation. There is an artificial spread when the retailer collects a profit on the amount of money he pays the government in customs duty and the amount of money he pays the railways for transportation; and if the customs duty could be collected in the same way that the sales tax is collected, at the time the article is sold by the retailer, it would make a great deal of difference in the cost of the article in Canada. If there is a duty of 25 per cent on an imported article and there is a mark-up of 50 per cent in order to make a 33i per cent return, on an article costing $100 that would make a difference of $12.50.


James Lorimer Ilsley: It would be equivalent to a considerable increase in the rate of duty.


James Samuel Taylor: The government could increase the rate of duty accordingly.


James Lorimer Ilsley: No, we would have to
decrease it.
Mr. TAYLOR (Nanaimo); No, the government could increase it if the duty was collected at the point of sale. I want that made quite clear. You collect the sales tax after you have sold the article. If you collect the duty on articles sold purely for domestic consumption costing over $50, let us say, in the same way-


James Lorimer Ilsley: At what point.


James Samuel Taylor: At the point of sale by the retailer, in the same way as you collect the sales tax.


James Lorimer Ilsley: The sales tax is not collected at that point at all; the sales tax is collected at the factory door.


James Samuel Taylor: The sales tax is collected by the retailer is it not?


James Lorimer Ilsley: The sales tax is collected at the time of sale by the manufacturer, on the value of the goods at the factory door.


James Samuel Taylor: That is the
factory sales tax?


James Lorimer Ilsley: Yes, that is our sales tax.
JMr. J. S. Taylor.]


James Samuel Taylor: You have a retail sales tax as well, have you not?


James Lorimer Ilsley: No.


An hon. MEMBER:: That is provincial.


James Samuel Taylor: It may be provincial, but it is possible to collect it in that way. If the same principle were adopted for collection of these duties on articles imported purely for domestic consumption it would make a great deal of difference in the price and would enable many consumers to obtain articles they cannot now afford because of the spread that exists between United States and Canadian prices.


Robert John Deachman: I think it should be made clear to the hon. member that in regard to the sales tax, the customs tariff and the excise tax, these are all pyramided, and there is an increase added as they move along. The sales tax collected at the factory door goes into the cost of the goods. The merchant takes those goods at a cost which represents the sales tax plus the invoice value of the goods and adds his mark-up. In consequence our eight per cent sales tax is reflected in an added cost amounting to probably twelve per cent, while a forty per cent duty probably runs up to a sixty or seventy per cent advance in the cost of the commodity to the consumer. So pyramid is piled on pyramid, and that is the fundamental reason why the spread between the prices of certain commodities in the United States and Canada is so great. We have to add the duty, or the manufacturer takes it in excess prices; then we must add a series of profits until we have reached such heights that a revulsion of feeling is caused. Then, when we want to bring it down, the hon. member for Davenport (Mr. MacNicol) offers objection.
The hon. gentleman suggested this afternoon, in regard to something I said, that he found it extremely difficult to follow me when I talked in millions. A young man was once employed by the census bureau. A few days later he came to his chief and said, "I feel that I must give up this job." The chief said, "Well, the task is quite simple. Why can you not go on with it?" The young man replied, "I was never taught to count beyond seven." I think when members of parliament cannot count beyond one hundred thousand they should not represent Toronto constituencies.


John Ritchie MacNicol: The hon. member talked in hundreds of millions.

Canada-United, States Trade Agreement


Douglas Gooderham Ross: Would the hon. member continue the figures he was giving a moment ago and give the figures for 1938 as well?


Robert John Deachman: That would be extremely difficult. In the first place I gave my notes to Hansard, and even if I had my notes I could not give those figures because the bureau of statistics does not yet record the figures for 1938. I venture to suggest that they will show a decrease, but I would not think the decline would be by any means as great as was the decline which followed when the friends of my distinguished friend came to office. Then industry tumbled and men found themselves out of work, despite all the protests of the leader of my hon. friends at that time that if he was elected he would solve that problem. Later on he said he would solve it or perish in the attempt, and he perished in the attempt.


Charles Avery Dunning: Mr. Chairman, this item concerns safety razor blades, and I would suggest that they are rather sharp to be used as instruments of controversy.


[Stage Direction]
Item agreed to.
Customs tariff-430. Nuts and bolts with or without threads, washers, rivets, of iron or steel, coated or not, n.o.p.; nut and bolt blanks, of iron or steel, per hundred pounds, 50 cents, and 17J per cent.
Joseph Henry Harris: This is another example of small industries which are very seriously affected, not only in large centres but in many small cities such as Brockville, Galt and similar places. Prior to the last agreement the duty was 75 cents per hundred pounds and 25 per cent; now it is 50 cents per hundred pounds and 174 per cent.


Charles Avery Dunning: Has my hon. friend
figured out the reduction here?


Joseph Henry Harris: Well, it is quite considerable when you add the effect of the two treaties together. In all these discussions we must bear in mind the cumulative effect of the two treaties. Canada absorbed the shock of the first treaty rather gracefully. But she does not realize what a shock she will receive from the cumulative effects of the two. And this is just another example of the-


Charles Avery Dunning: I must disagree with my hon. friend's conclusions there, because it is a curious fact in connection with this item of nuts, bolts, washers and so on, that our imports from the United States actually declined from 1936 to 1938. Imports in 1936 were valued at $351,000, and in 1938 they
were $274,000. When I notice that our production went up from just over $2,900,000 in 1934 to 84,070,000 in 1936, I am bound to think there is not any great amount of suffering reflected in those figures.


Mr. STEWART:: What are the corresponding rates on the same lines going into the United States?


Charles Avery Dunning: They are six-tenths of one cent a pound on nuts, one cent a pound on bolts, and the washers go with the nuts.


Hugh Alexander Stewart: And what about rivets?


Charles Avery Dunning: I am afraid we have not worked out the information with respect to rivets. The United States item does not correspond with ours.


Hugh Alexander Stewart: Is the United States rate against the Canadian product higher than the Canadian rate against the United States product?


Charles Avery Dunning: The comparison is very close, something like comparing half a cent, plus fifteen per cent, with six-tenths of a cent.


Hugh Alexander Stewart: Quite similar then.


[Stage Direction]
Item agreed to.
Customs tariff-431b. Adzes, anvils, vises, cleavers, hatchets, saws, augers, bits, drills, screwdrivers, planes, spokeshaves, chisels, mallets, metal wedges, wrenches, sledges, hammers, crowibars, cantdogs, and track tools, picks, mattocks, and eyes or polls for the same: 274 per cent.
Joseph Henry Harris: The Minister of Finance was rather quick to grab at an item in connection with which there happened to be no particular increase in imports. Perhaps he would give the figures for item 431b?


Charles Avery Dunning: Surely. In 1938, imports from the United States were valued at $824,000, and we exported $1,312,000 worth, mainly to Australia, the United Kingdom and New Zealand.


Joseph Henry Harris: No exports to the United
States?


Charles Avery Dunning: There was $18,000 worth.


Joseph Henry Harris: That is $800,000 in and $18,000 out.


Charles Avery Dunning: To the United States.


Joseph Henry Harris: Whereas in 1935, imports were valued at only $426,000. The importation has doubled in three years.


Charles Avery Dunning: I am pleased to note an increase in our own production, between the two years, in practically all of these items.

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Hugh Alexander Stewart: Would the minister give the same information with respect to the United States rate against adzes, and so on?


Charles Avery Dunning: Forty-five per cent on practically all hand tools.


[Stage Direction]
Item agreed to.
Customs tariff-431c. Machinists' or metal workers' precisian tools and measuring instruments, viz.: Calipers, micrometers, metal pro. tractors and squares, bevels, verniers, gauges, gauge blocks, parallels, buttons, mercury plumb bobs, dividers, trammels, scribers, centre punches, pocket speed indicators, straight edges, key seat clamps and other clamps and vises used by toolmakers for precision work, precision tools and measuring instruments, n.o.p.: 10 per cent.
Joseph Henry Harris: Another example where
imports from the United States have jumped from 166,000 to $256,000.


Charles Avery Dunning: What item is that?


Joseph Henry Harris: The group item the chairman has just read, namely 431c and 431d. I understand the minister has the figures all under one item.


Charles Avery Dunning: I do not have them separately. Yes, they have increased to the extent of about $100,000 between 1937 and 1938.


[Stage Direction]
Item agreed to.
Customs tariff-431d. Engineers', surveyors' and draftsmen's precision instruments and apparatus, viz,: alidades; altazimuth surveying instruments; aneroid barometers, engineering, military and surveying; angle prisms; boards, military sketching; box sextants; clinometers; compasses; cross staff heads; curves, adjustable, irregular, railroad and ship; eurvimeters; drafting instruments of all kinds, including fitted cases containing the same; dipping needles; drafting machines; heliographs; integrators; levels, tripod and hand or pocket types; levelling rods; liners, section; meters, portable for hydraulic engineering; pantographs; plani-meters; protractors; parallel rulers; parallel ruling attachments; poles, ranging; pedometers and paceometers; plane tables, military and topographic; scales, flat and triangular; slide rules; splines; straight edges, steel and wooden; tachometers; tallying machines, pocket; tee squares, steel and wooden; telemeters; theodolites; transits, tripod and hand or pocket types; triangles of all types; tripods for use with any of the foregoing instruments: 10 per cent.
Item agreed to.
Customs tariff-431 f. Files and rasps: 27i per cent.
Item agreed to.
Customs tariff-432. Hollow-ware, of iron or steel, coated or not, n.o.p.: 25 per cent.
Item agreed to.
fMr. Dunning.]
Customs tariff-432a. Kitchen and dairy hollow-ware of iron or steel, coated with tin, including cans for shipping milk or cream, not painted, japanned or decorated: 25 per cent.
Item agreed to.
Customs tariff-432b. Hollow-ware, of iron or steel, coated with vitreous enamel: 30 per cent.
Karl Kenneth Homuth: What is the value of imports under this item?


Charles Avery Dunning: In 1938, imports from the United States were valued at $126,000, and our own production stood at about $1,400,000. Rates going into the United States on enameled hollow-ware are five cents a pound, and 15 per cent ad valorem.


[Stage Direction]
Item agreed to.
Customs tariff-432d. Manufactures of tinplate, painted, japanned, decorated or not, and manufactures of tin, n.o.p.: 25 per cent.
Albert A. Brown: What are the imports?


Charles Avery Dunning: There are two items, amounting to $321,000 and $443,000 respectively, making a total of $764,000, which represents the imports into Canada from the United States in 1938. Our own production has increased enormously under this item; it runs to about $20,000,000. The duty going into the United States is at forty-five per cent on all items, except containers, which represent a big part of the total. Containers enter the United States at 22| per cent.


Joseph Henry Harris: Items 432a b, c and d give just another example of where imports have doubled on each item in the last three years.


Charles Avery Dunning: Also home production has advanced in almost the same proportion, I can tell the hon. member for Danforth.


[Stage Direction]
Item agreed to.
Customs tariff-435, ex 434, ex 434a. Locomotives and motor cars for railways, of a class or kind not made in Canada, and complete parts thereof, for use exclusively in mining, metallurgical or sawmill operations: 12J per cent.
Item agreed to.
Customs tariff-438a. Automobiles and motor vehicles of all kinds, n.o.p.; electric trackless trolley buses; chassis for all the foregoing: 174 Per cent.
Provided, that machines or other articles mounted on the foregoing, or attached thereto for purposes other than loading or unloading the vehicle shall be valued separately and duty assessed under the tariff items regularly applicable thereto.
Robert James Manion: I have had sent to me a
statement which I assume some of the ministers have also had sent to them; therefore

Canada-United States Trade Agreement
they will be able to speak intelligently in regard to the matter. The statement is from the Detroit Free Press of March 19, and is contained in a dispatch dated at Ottawa, March 18. Perhaps the easiest way is to read part of it. It is supposed to be a statement of fact. The gist of the statement is that of the three large automobile manufacturing companies in Canada, at least two are on the verge of closing down because of the change in duties, and the cutting off of the excise tax of three per cent. I shall read a paragraph. If the minister wishes me to stop reading it, I shall do so. It is not meant as a criticism, but it can be placed before the committee better by reading it than could be done by an attempt to synopsize it. This is a special dispatch to the Detroit Free Press, dated Ottawa, March 18. It reads:
The Canadian government, it is learned on high authority, is concentrating on the problem of preventing the largest branch plant industry operated by United States capital in Canada- the automobile industry-from being lost to the dominion and repatriated to the United States.
Of the "big three" motor car manufacturers who maintain complete plants in Canada, one alone is described in governmental circles as being content to remain in the dominion.
The other two are said to be anxious to discontinue their Canadian operations and to transfer the substantial volume of employment that they afford to their parent factories in the United States, where enlarged mass production methods would effect important savings.
Lower down it states:
The new Canada-United States trade treaty is responsible directly for the critical situation. The arrangement binds at 17i per cent the duty payable on United States automobiles coming into Canada and removes the three per cent excise tax which has been required on motor cars imported into Canada from any country other than Great Britain in recent years.
Then the article goes on to emphasize the importance to the automobile industry of the loss of this three per cent, and gives further details of the advantages to automobile companies of importing their cars instead of manufacturing them in Canada. The article continues :
When Canadian officials discovered that the new trade treaty threatened to have this effect on one of the country's most important industries, they formulated representations to Washington.
I am just trying to give the gist of this article. Lower down it says:
The proposal w-as made, accordingly, that three companies should be approached to write President Roosevelt in support of the Canadian application for a change in the treaty.
Conferences, however, speedily made it apparent that the United States automobile manufacturers were not favourably inclined.
71492-138i
And again:
The suggestion most commonly heard is that the Minister of National Revenue, J. L. Ilsley, takes advantage of a section of the Customs Act which empowers him to declare special duties on commodities that are being "dumped" on the Canadian market.
This is a fairly long article and I think I have read enough to give the gist. It was sent to me by one of the automobile workers' associations. The hon. member for Hamilton East (Mr. Brown) has had the same thing sent to him and, I believe, will have something to say about it later on because it directly affects his constituency. I was asked, however, to bring it up, and in view of the importance of this matter perhaps either the Minister of Finance (Mr. Dunning) or the Minister of National Revenue (Mr. Ilsley) will be able to tell us the facts. I should like to hear what they have to say in regard to it.


Mr. MOORE:: Before the minister answers the leader of the opposition, may I say that for the past several days I have been receiving hundreds of communications from people in my riding in reference to this matter. I shall not attempt to read them all; as they are all to the same effect, I shall read one only. I take it that these have been sent by employees of General Motors in Oshawa,, and this particular one reads:
I view with much concern the insecurity of employment in the Canadian automotive industry and therefore urge you to use your influence to bring about an investigation in the industry-in regards to same especially the effect of recent tariff adjustments.
With regard to what the leader of the opposition has said, it is common information that the tariff board has been investigating the automobile industry for some years. May I ask if the present tariff was based on the findings of the tariff board?


Mr. MARTIN:: I believe I represent a district which manufactures more automobiles than any other district in Canada. Before the minister replies to the leader of the opposition (Mr. Manion) and the hon. member for Ontario (Mr. Moore), may I say that the newspaper article to which the leader of the opposition referred was also sent to me. I have received other communications of apprehension from men engaged in the automobile industry. These have come to me from people who live in the areas where different branches of the automobile industry are located, as well as from other centres in Ontario and the province of Quebec. When the Minister of Finance (Mr. Dunning) makes his statement, I am sure he will note that those of us who come from the areas concerned have been alive to this problem. We are
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trusting that whatever is done will be so effectuated as to guarantee the stability of this industry, not only for what it means in itself but for what it means to the thousands of men who depend upon it for a livelihood.


Mr. LOCKHART:: I have received communications which indicate that unemployment in this industry is still on the increase. I agree with the statement of the hon. member for Essex East (Mr. Martin) that Windsor is a large automotive centre, but I represent a constituency in which this industry plays a large part. I imagine that the hon. member for Hamilton East (Mr. Brown) has also received communications similar to those which have reached me. I just want to associate myself with the leader of the opposition (Mr. Manion) and other hon. members who have spoken in this connection.


Charles Avery Dunning: ' I was wanting to answer the questions that have been asked, but apparently hon. members are associating themselves for the purpose of getting some statement from me. I was trying to answer the specific questions asked by the leader of the opposition (Mr. Manion) and the hon. member for Ontario (Mr. Moore), and I had no intention of closing off the debate on this item. I have not seen the newspaper article referred to by the leader of the opposition, and I thank him for reading it. In so far as it intimates that the government of Canada has made representations to the government of the United States since the signing of the treaty, it is entirely incorrect.


Robert James Manion: The minister means with
reference to automobiles, because this government has made representations with regard to cattle.


Charles Avery Dunning: The article referred
specifically to automobiles, and there is no foundation in fact for that statement. Another allegation was made that because of the provisions in the treaty two of the three large automobile manufacturers were considering withdrawing from Canada. I have no information which would lead me to believe that there is any truth in that statement.
In reply to the question asked by the hon. member for Ontario, I may say that there has been no report by the tariff board. As my hon. friend knows, the reference with respect to automobiles has been a continuing one and the treaty was negotiated with the United States without the aid, if I may put it in that way, of a final report from the tariff board.


Major James William Coldwell: Just before the item carries, in view of the discussion I think some of us might express a word from a

slightly different point of view, because there are other points of view in the house than those which have been placed before the minister.
While we have every sympathy with the men who are engaged in this industry, we cannot be blind to the fact that it has grown up behind what has been in the past a fairly substantial protective tariff; and if the plea were made by the companies more genuinely from the point of view of safeguarding the interests of the men employed in this industry there would be much more sympathy with it.
I have in mind this fact, that in the automobile industry men have worked under conditions which have to a large degree undermined their health; that while rates of wages have looked high when considered on an hourly or daily basis, the yearly wage in the automobile industry has not been, over the years, relatively high; and I have observed in this industry, in the city of Regina where my home is, that when times grew slack men congregated day after day round the doors of the automobile plant hoping for work and were often employed for just a few hours.
It seems to me that if an industry which can pile up dividends, surpluses, reserves and so on to the extent that this industry has done, receives protection from the Dominion of Canada or from any other country, it ought also to be made to assume responsibilities with regard to its working force. I want to place that point of view before the committee, because I have every sympathy with the men whose jobs are in jeopardy; but at the same time I want to make it abundantly clear that over a period of years the people of Canada have paid for automobiles prices far in excess of what should have been paid; and moreover the industry, while it has paid, as I have said, a relatively high hourly or daily wage, has not assumed responsibility for the care and safeguarding of the men whom it has employed.
Hence, when I hear a plea made in this chamber, as it has been this afternoon, apparently wholly from the point of view of those who are likely to lose their jobs in the industry, I come back to the thought that there are other considerations which ought to be reviewed when we are considering protective tariffs, if we are asked to maintain them for this industry.


William Henry Moore: May I say just a word in reference to what has been said by the hon. member for Rosetown-Biggar? He has spoken of the high protection accorded to the motor car industry of Canada.


Major James William Coldwell: In past years.

Canada-United States Trade Agreement


William Henry Moore: In past years. I venture to say that for some years Canada has had the second lowest protective rate of any producing country in the world. It must be remembered also that we have a free item, a free import from the United Kingdom, and no other motor-car producing country has a free item.
If the hon. member will think back for just a moment or two, he will recall that it is not only tariff rates which affect employment in and the productivity of an industry; it is changes in rates; and I venture to say that in the last ten or fifteen years there have been not less than a hundred changes made in the tariff rates on the materials and the parts used in the automotive industry of this country. The hon. member will also remember, I hope, that when the United Kingdom was a free trade country, or so called, about 1915, it imposed a tariff rate of some thirty per cent-if I am not wrong- against the motor-cars of the United States, or under its general tariff, giving us a preference of one-third off. The British government did that for a specific purpose. The United Kingdom was not given to protective tariffs at that time; it was not a protective country; it did not believe in the principle of protection. It gave protection to the motorcar industry because of its impregnation of life into other industries, because of its encouragement in the production of alloy steels, and I hope I can have the backing of the Minister of National Defence (Mr. Mackenzie) when I say, more particularly because no country to-day can defend itself without the modern armament which comes from the production of flexible power. There are two things tp be considered-and again with deference to the superior knowledge of the Minister of National Defence-in connection with modem armaments. One is the aeroplane, and the aeroplane has developed out of the motor-car engine. The other is the tank, and the tank has developed out of the tractor. And we make no tractors in this country.


John Ritchie MacNicol: We should.


William Henry Moore: I quite agree that we should. We make no tractors in this country, and we are not encouraging the manufacture in this country of motor-car engines as we should be doing if we wish some day to have a self-respecting position so far as self-defence is concerned.
I wonder if the hon. member for Rosetown-Biggar, who has a very great regard for workers in this country, is quite right in his
reference to wages. I had occasion some two or three years ago to look up the annual wage drawings of the men in the motor-car industry, and as I recall it, sir, they were about the third or the fourth best-paid employees in Canada.


Major James William Coldwell: What year was that?


William Henry Moore: I should say three or four years ago. We have been dropping back. There was a time when we in this country made twice as many motor-cars as the United Kingdom, and I am speaking offhand when I say that the situation is reversed.
I did not intend to speak on this subject, but I will say this, that the conditions of men in the motor-car industry are terrible. It is not only the men that are on relief; it is the men, as the hon. member for Rose-town-Biggar said, that are employed only half-time.
So far as the general argument on the treaty is concerned. I do not propose to enter into it now, but I will say this, that the motor-car industry will be glad to have less than the average rate which has been conceded to agriculture under the agreement. I have gone over it rather carefully, and I find that there are far greater duties in favour of the live stock industry, -I think forty-five per cent under this agreement placed on beef and veal from the United States. There is some sixty or seventy per cent on importations from the Argentine, which is a good customer for some of our manufactured products.
The other day I heard the hon. member for Dufferin-Simcoe (Mr. Rowe) speaking eloquently about the protection which should be given the dairy industry. The motor-car industry will be glad to have just one-half of the consideration which is given to the daily industry in this country.


Mr. ROWE (Dufferin-Simcoe):: I will
support that too.


William Henry Moore: When the hon. member for Rosetown-Biggar speaks of the disparity in prices, I would just have him remember that it is an illusion to think that the duty is high on durable goods because you pay it in a bulk sum. You swallow your protection on agricultural production three times a day throughout the year.


Mr. DONNELLY:: Some of our protectionist friends on both sides of the house have joined together in favour of the retention of the excise tax on automobiles. I wish to associate myself with the hon. member for Rosetown-Biggar (Mr. Coldwell) in the effort to have the tax taken away. I was very
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much surprised indeed, when there was any suggestion on the part of the government of touching either the duty or the excise tax on automobiles, that there was not a roar from the automobile industry. I can remember what happened in 1926. I saw them come here with their labourers, parading in front of the buildings and carrying placards reading, "I have fought for Canada, I have bled for Canada, and now I have to leave Canada because we are going to be thrown out of work." When they were told that the government would stand by the reduction in the duty they went back home, and what did they do? They made their factories bigger and increased the manufacture of automobiles so that production was greater than it had ever been before.
An lion. MEMBER: Export trade.


James J. Donnelly: Yes, but a good deal of it was home trade as well, and the home trade was better immediately after that was done than it had been for many years before.


Hugh Alexander Stewart: Will the hon. gentleman tell the committee what budget changes were made subsequently that gave relief?


James J. Donnelly: The duty remained,
and all I know is that when I went to buy an automobile I paid anywhere from $50 or $75 to $100 less. I can see that by the removal of the excise tax people will be able to buy cars still cheaper.


An hon. MEMBER:: They will pay for
it in increased taxation.


James J. Donnelly: If we pay for it in
some other form I am not concerned with that. The hon. member for Ontario (Mr. Moore) referred to the fact that farmer's had a great deal of protection. Well, so far as the wheat growers of western Canada are concerned, they have no protection in any shape or form. There is a duty on wheat, but that does not do us a particle of good. The duty on wheat, cattle, barley, oats and rye could be removed, and its removal would not mean anything to us. The duty is not a bit of good to us. It is all eye-wash, window-dressing, something to talk about to show that you are protecting the farmer. But such protection is of no use to us. We have to pay duties on the commodities we buy, and we do not get a bit of good from the duty on wheat. You put a duty on vegetables, machinery and other commodities that we use, and we pay.


William Ross Macdonald: Are you getting a guaranteed price for your wheat in the west?


James J. Donnelly: We are getting a guaranteed price, yes. And why should we not? We have been contributing for years to the manufacturing concerns, so why should we not get a guaranteed price? I shall discuss that later on, but at the moment I am talking about automobiles and the hon. member will not divert me. Reference was also made to assistance given to dairymen. If you are going to use the dairymen in the way you have used the automobile people, then I suggest that the dairymen should get their cream separators free of duty, because the automobile people get their raw products free.
There is a suggestion that some automobile manufacturers may move out of the country. If any of them have moved or if they intend to move, it is not because they are not getting enough protection; it is because of the regulations and the manner in which the duty is collected. If I live in the west I pay duty not only on the automobile at the factory door, but on the freight as well. If I live in British Columbia I pay duty on about $150 more than I would pay for the car at the factory door because it costs that much more by reason of the freight. That is the first injustice to which the western consumer is subject. We pay duty on the car and on the freight to destination at a point south of the line out there, which is unfair to us and makes the duty that much higher.
Another point is this. These manufacturers hire an importing agent. The agent crosses the line and makes regulations and certain arrangements whereby the cars are bought, not at the retail price but "wholesale, which is twenty-five, thirty and sometimes even as much as forty per cent less than the retail price on the other side; and when they bring the car to this country, if it costs $1,000 they pay duty not on $1,000 but on $650 or $700. Therefore they get a reduction and are able then quite easily to compete with manufacturers of cars in this country.
I maintain that the duty on cars should be collected at the factory door-wherever it may be in the United States-and we should impose that duty on the retail price, not on the wholesale price. The duty could be adjusted so as to be reasonable. But the way in which the duty is collected on automobiles to-day has made it possible for some of the automobile people to cross the line and manufacture in the United States instead of in Canada. That is the trouble; it is not the duty but the manner in which the duty is collected. The regulations should be changed.


James Lorimer Ilsley: Before the discussion takes too wide a range, I should like to refer to some remarks made by the leader of the

Canada-United States Trade Agreement
opposition (Mr. Manion) and two or three other members. The leader of the opposition referred to a dispatch to the Detroit Free Press. I have not seen that dispatch; but as I understood it, it was suggested by the writer that concern was being felt that two or three of the so-called big automobile manufacturing companies might transfer operations from Canada to the United States. The Minister of Finance (Mr. Dunning) has referred to it, and I want to confirm what he has said. 1 have never heard it suggested that anything of that kind was likely to occur. I have never heard the fear expressed that it might occur. The fear has been expressed that a limited range of cars with small Canadian content might possibly be manufactured on the other side of the line instead of on this side. Whether that fear is justified I am not able to say with certainty; but the suggestion that has been made to me as Minister of National Revenue-and that is probably the reason why my name is mentioned in that regard- is that the law respecting valuations for duty purposes is not being properly applied by the Department of National Revenue. All that I can say in that regard is that these representations are receiving the consideration of the Department of National Revenue at the present time. I do not think there is anything more I can add.


Robert James Manion: The discussion has taken a much wider range than I had contemplated. Being of a peaceful disposition, I assure the committee that the last thought in the world that entered my mind was to stir up any contention. I really was looking for information, and I have got some; more, I must confess, from my hon. friend to my right and some other hon. gentlemen than from the ministers perhaps, because apparently the article w'as not sent to them. There have been resolutions-[DOT]


John Ritchie MacNicol: One from the city council of Windsor.


Robert James Manion: 
An hon. MEMBER:: Without grousing.


Robert James Manion: Yes, I do not think there has been much growling from the east. To my mind it has been done in a very fine spirit. When the east is willing to do that, I do not think the antagonistic attitude of the hon. member for Wood Mountain (Mr. Donnelly)-


James J. Donnelly: They took it from us
before; why should they not give some of it back?


Robert James Manion: -towards protection in general was altogether justified. After all, if we have kept men at work in Windsor, Oshawa and other cities, it is just as useful to Canada as to keep men at work out west. We should remember that we are working on the basis of a Canadian nation, not just the east or the west. I think some in the east as well as some in the west, but perhaps a greater proportion in the west, must learn that the east and the west must work together.
But if the statements made in this resolution are correct, the danger is that what is going to happen is that two or three big companies in Windsor or Oshawa may close down or reduce their operations so that there will be very much less employment in those cities, and yet automobiles will not be any cheaper. In other words, there will not be any cut in price at all, and thousands of men being thrown out of work will add to the troubles of this country, and of this government if you will.
In regard to the remark of the hon. member for Rosetown-Biggar (Mr. Coldwell) that these industries should take.care of their men, again I agree with him. I think we are

coming to the time when all industries must do more than they have done in the past to ensure the year-round employment and the future of their employees. It happens rather strangely that I recall speaking to a huge meeting of industrialists in the Prince Edward hotel, in the city of Windsor on October 15, 1931, when I was a minister of the late government-I remember the date for a personal reason of my own-and advocating that very thing. I pointed out that there had been too much tendency in the past-


Paul Joseph James Martin: Will the hon. member permit a question


Robert James Manion: Will the hon. member first let me finish my sentence. I said there had been too much tendency in the past for industrialists, when conditions became bad, to take care of their plant and machinery but to let the human part of their organization, their employees, the most important part, be turned out on the street to be cared for by charity or by the state. I believe industry must correct that. A good many companies in the United States and some in Canada are to-day doing so. Industry must combine with the government of the day, whatever government it may happen to be, in caring for its employees, giving them work throughout the year so far as it can be done.
Now did my hon. friend wish to ask a question?


Paul Joseph James Martin: I can cover it later.


Robert James Manion: That is the main point I wanted to make. It is not a case in my mind of trying to care for the shareholder or the bondholder; I am not particularly worried about them; I am chiefly interested in maintaining employment in this country. We have built up the industry, and I believe the government might very well give serious thought to the presentations which have been made here this afternoon from various sections of the house. I do not think they are finished; I know the hon. member for Hamilton East (Mr. Brown) has been trying a number of times to get an opportunity to speak for his section. Many sections of Canada are affected. I hope the ministers are correct in their statement, although neither of them seems very familiar with the statements made here.


Charles Avery Dunning: We are familiar with what is rather more important, that is the attitude of the companies themselves.


Robert James Manion: Perhaps so. I am not criticizing, but the ministers seemed indefinite in their statement. I should be glad to see that item held over-


Charles Avery Dunning: It will be in any event.

Canada-United. States Trade Agreement


Robert James Manion: -until another day, and let the ministers make further inquiry and see if more definite information cannot be given to the committee than we have been given this afternoon.


Paul Joseph James Martin: The hon. member for
Rosetown-Biggar, speaking immediately after my earlier remarks, I think would leave the impression that I for one am interested in this question only from the point of view of seeing that the automobile industry was maintained in this country.


Major James William Coldwell: I did not intend that.


Paul Joseph James Martin: I am grateful to the hon. member for that correction, because he will recall that several weeks ago in this house, speaking on the resolution introduced by the hon. member for Comox-Alberni (Mr. Neill),
I referred specifically to the condition of unemployment in so far as it affected the workingmen employed in the automobile industry. On that occasion I pointed out, and I do so again to-day, that the automobile industry, important as it is to the economy of this country, is at the same time illustrative of some of the weaknesses of what I called then and call now our acquisitive and competitive system. Consequently, and assuming that this system is here to stay for some time in spite of what hon. gentlemen opposite may wish, this is a fact. With this in mind, I urge this house and this government to bring in at once a system of contributory unemployment insurance on a national scale, so as to take care of the unemployment in reference to that particular industry.


Mr. HEAPS:: How could it?


Paul Joseph James Martin: I cannot get on to that point, because I have discussed it already. The automobile industry is certainly one in which that measure would definitely apply.
I think the leader of the opposition did not go perhaps as far as I would when he said that we are now faced with the fact that the automobile industry is here. Whether or not it should have been introduced into our economy is another question, the leader of the opposition observed. Looking at the facts squarely, I suggest to him and to hon. members of this, committee, having in mind all the subsidiary industries that are dependent upon the automobile industry; having in mind the thousands of men directly employed in that industry and in other industries which owe their existence to it, it is a very good thing for Canada that among our secondary industries we have the automobile industry. The Minister of Labour (Mr. Rogers), who these days is confronted with the problem of giving men work, would indeed be faced with a tremendous problem if not only in my own city but in Oshawa and other places throughout this country there was no automobile industry.


Mr. WOODSWORTH:: My hon. friend
suggests that the automobile industry is here to stay. It is here under certain privileges, and I would ask the hon. member whether the government ought not to insist that something like security of employment and decent wages should be maintained.


Paul Joseph James Martin: I fully agree with that. A few moments ago I repeated what I stated in this house when the resolution urging the adoption of a scheme of unemployment insurance was under discussion.


Major James William Coldwell: Let the government take the responsibility.


Paul Joseph James Martin: Of course; I have said so, and I repeat it. That is one of the delights of being on this side of the house; one can freely express a dissentient view without fear of the party whip.


Robert James Manion: As long as you vote right.


Paul Joseph James Martin: The hon. member may be sure I will vote right.


James Shaver Woodsworth: Why should not the industry carry the risk?


Paul Joseph James Martin: I am coming to that, and it is a perfectly proper question. When this government took office in 1935 they did what I thought was the proper thing, having in mind the complex features of this industry; they referred the whole matter to the tariff board, where it remains under a continuing reference. I attended the hearings of that board for almost two and a half months in an endeavour not only to follow the briefs and presentations but also to learn something about an industry of which, as to its technical side, I had very little knowledge. No one who followed that inquiry would dare rise in his place in this house and dogmatically say either that there should be no tariff on automobiles or that there should be an excessive tariff. The man who makes that sort of extreme statement I dare say is not familiar with the problem itself. But while the tariff board has considered and continues to consider this problem, I fully agree with what the hon. member for Winnipeg North Centre has said. There is a duty upon industry to provide adequately, to the extent that industry can for its employees who inevitably, even in normal times, are not continuously engaged during the course of the year.
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I do not want to appear narrow or sectional in my outlook; I trust that my conduct in this house has been otherwise. But I cannot help agreeing in a measure perhaps not with the provocation but with some of the things suggested by the leader of the opposition. Undoubtedly anyone who looks at our problem generally will be impressed with the need of continued compromise between one section and another. It is not going to do my hon. friends from the west any good to suggest to those of us who live in the east that we are unmindful of the problems of the west or that under our economy we are causing those in the west to be continually subordinated to our interests. Surely that is not the picture. Undoubtedly we have conflicting economic interests, and the task of government in this country is to reconcile and compromise those interests in the interests of all.
I might rise in my place in this house and make myself a very popular man in my own constituency and my own province by saying, "I am going to oppose the wheat bonus. I am going to oppose the Prairie Farm Rehabilitation Act." I could make myself a very popular member in Windsor and other parts of Ontario if I did that, but I am not going to stoop to that kind of practice. I simply make an appeal to the house, to my hon. friends from the west who have great problems, to realize that we in the east have great problems as well. Come to my own city of Windsor; go up street after street and you will find men and women living under the most difficult economic circumstances, just as difficult as those experienced by the unfortunate people in the drought areas of the west. And what is true in the urban part of my riding is equally true in the rural section. We too have our problems, and we are not going to get anywhere in this house by pitting our sectional and political interests against the interests of Canada generally.
I hope I have not spoken too strongly, but I do feel that hon. members and particularly those from the western part of this country, regardless of their political affiliations, should realize what the automobile industry means to Canada. True, as a consumer, the western farmer is placed under a difficulty to which, with a freer system of trade, he would not be subjected; but that is an inevitable circumstance in the economy of this country, as long as we are going to preserve under this confederation nine provinces, with these various sectional interests; and the sooner we realize this, the better.
The leader of the opposition has referred to the resolution which was passed by the city council of Windsor. I forwarded that
[Mr. Martin.!
resolution to the Minister of Finance, the Minister of National Revenue, the Prime Minister and others. They were already aware of it; they had read it long before it was read in this house. It was perfectly natural that before the fact became accomplished, with all the suggested rumours and the like, people living in an area in which the automobile industry predominated should find themselves somewhat concerned. That resolution represents a perfectly legitimate concern. It represents an appeal on the part of working men and on the part of others, asking not only the government-because the government is aware of the importance of the industry to Canada-but also the house to appreciate the significance of the automobile industry in the economy of our country, and particularly to those who derive their income as working men from employment in that industry.
I must say, and I say this in the house, that I first of all thank the Minister of National Revenue (Mr. Usley) for the statement he has made to-day, namely that this whole matter is receiving the consideration of the government. I want the committee to know that there could have been no more painstaking effort on the part of the Minister of Finance and on the part of the Minister of National Revenue in considering this problem, as they have done during the past two or three weeks particularly, in conference day after day with members from Essex county and other parts of Ontario and myself.


John Ritchie MacNicol: You cannot do anything with the matter now; the treaty is passed and in operation.


Paul Joseph James Martin: If my hon. friend would
learn sometimes to subjugate his political interests in the interests of objective treatment, I think he would sometimes make a greater contribution to the debates of the house.


John Ritchie MacNicol: How clever; well, well!


Paul Joseph James Martin: Well, it may not be as
clever as it was intended to be, but I hope it struck the right note.
As far as the excise tax is concerned, let us of course face realities. It is in the treaty. It applies not only to the automobile industry, but all along the line. There are other ways of providing compensation for an indispensable industry-


Douglas Gooderham Ross: What compensation?


Paul Joseph James Martin: I am afraid the Customs
Act is a detailed one, but if my hon. friend is prepared to try to understand some of its

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Frederick George Sanderson: I do not think the hon. member is in order.
measures and clauses, he would understand the kind of aid that can be given. I do not think it is necessary for me to advise the government on this score, because it is aware of the importance of the industry to Canada, as much as I am; but speaking for an area where the automobile industry predominates,
I would urge the government with all the sincerity I can to regard this measure not as one which concerns Windsor, not as one which concerns Oshawa, not as one which concerns the province of Ontario, but as one which concerns the great majority of the people of Canada.
Second, I ask the government to realize, as I am sure it does and will realize-irrespective of any representations I make to-day -that even in normal times, and even assuming this period of economic crisis had passed, unemployment in this industry is to a great extent inevitable. As the leader of the opposition has said, unless in the very near future we provide some measure of constancy of income, some measure of security of income for men engaged in the automobile industry, and in other industries as well, the situation will in its proportions touch not alone the automobile industry, not alone secondary industry, but industry as a whole.


Abraham Albert Heaps: Would the hon. member permit a question?


Paul Joseph James Martin: Yes.


Abraham Albert Heaps: Has the hon. member any suggestion to make as to what the government should do in the existing situation?


Paul Joseph James Martin: I am anxious at all times to be as courteous as I can. particularly to the older members. If I said something to the hon. member for Davenport (Mr. Mac-Nicol) which he did not like, I should like to withdraw it at once.


John Ritchie MacNicol: I do not see why my hon. friend should class me as an older member?


Paul Joseph James Martin: At least I have put myself adequately on record.
I answer what the hon. member for Winnipeg North has asked, I have already made a suggestion, and I am afraid if I repeated it, your honour, whose generosity has been unparalleled throughout the course of my observations, might possibly stop me. I have already suggested what should be done.


Abraham Albert Heaps: Unemployment insurance?


Paul Joseph James Martin: Certainly. If there is any industry which unemployment insurance would benefit, it is the automobile industry.


Abraham Albert Heaps: I am figuring-


Abraham Albert Heaps: I am not speaking about unemployment insurance at all.


Frederick George Sanderson: I was about to say that the hon. member for Essex East is out of order when he discusses, or attempts to discuss unemployment insurance under this item.


Abraham Albert Heaps: My question is this: In view of the fact that there is a possibility of these industries moving from Canada to the country to the south of us, is there any suggestion whereby the industry might remain in Canada?


Paul Joseph James Martin: In answer to the hon. member for St. Paul's (Mr. Ross) I referred to the provisions of the Customs Act. In my judgment there is within the terms of the present Customs Act an opportunity to obviate whatever harm may exist because of the removal of the three per cent excise. If I interpreted correctly what the Minister of National Revenue has said, that is one of the circumstances or proposals which is now being considered.
Mr. Chairman, I say in conclusion that this question is one which is not capable merely of dogmatic conclusion. Up to now the government of Canada has placed full reliance on the inquiry of the tariff board. That board, sitting with full opportunity of hearing all sides of the industry is, in my opinion, the best body to give the house and the government advice on a complex matter. I suggest to the government that the recommendations of that board, after the full and exhaustive inquiry it makes, should be given the consideration that is intended.


Malcolm McLean: Carried.


Paul Joseph James Martin: I wish to say one more thing, in spite of what the hon. member for Melfort has said. The item is not carried yet. The suggestion is made that some industries are going to leave Canada.


An hon. MEMBER:: We have heard that many times.


Paul Joseph James Martin: The fact is that one has already left.


Malcolm McLean: Which one?


Paul Joseph James Martin: One has already left. The fact is, also, that unless the precautionary steps, which I believe are at least to be derived inferentially from what the Minister of National Revenue has said, are taken, other
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industries may have to leave. But the automobile industry has made an honest effort to include as much of the materials that go to constitute a car out of materials made in Canada, as any industry has. While some hon. members opposite may say that this government is hurting industry, in spite of the difficulty at the present time let me tell them it was under this government that the Ford Motor Company was able to make an addition to its plant costing 18,000,000. It was under this government that the Chrysler corporation was able to add to its plant by a $3,000,000 additional structure.


John Ritchie MacNicol: The Conservative tariff policy.


Paul Joseph James Martin: That is what my hon. friend says. I say it was under this government, and there was not then the same tariff policy as prevailed when my hon. friend's party was in power.


Charles Avery Dunning: I can see that this item will not carry, so it will have to stand. While the committee will continue sitting tonight, if it meets the convenience of hon. members the Minister of Trade and Commerce (Mr. Euler) will take up schedule II.


Robert James Manion: The hon. member for
Broadview (Mr. Church) was ruled out of order to-day. I take the matter up because I notice item 415 was discussed on March 21.
I turn over the page and find that at six o'clock the item had not passed. I understand from the hon. member for Broadview that this afternoon when he attempted to say something with respect to it he was ruled out of order. He would like to have an opportunity to speak. I know the minister had no intention of preventing the hon. member from speaking. I should like to have it understood that when we sit again the hon. member will have an opportunity to speak respecting item 415. Hansard shows that it had not passed.


Charles Avery Dunning: My impression was the hon. member for Broadview went on subsequently, and did discuss it.


Robert James Manion: This afternoon he did not get a chance, and he wanted to say something about it. Is it understood he will have that opportunity?


Charles Avery Dunning: Yes.
Item stands.
At six o clock the committee took recess.

After Recess
The committee resumed at eight o'clock.
On schedule II.
United States tariff-1. Acetic acid containing by weight of acetic acid:
Not more than 65 per centum: | cent per pound.
More than 65 per centum: one cent per pound.


Joseph Henry Harris: Mr. Chairman, it is not customary to start in on a new schedule without the minister making a general statement covering the whole schedule. In the agreement as it is before us, there is a summary preceding schedule II, but surely on an important matter such as this the minister will make a general statement. We have another minister handling this part of the agreement, the Minister of Trade and Commerce (Mr. Euler), and it is only reasonable to expect from him a general statement in like manner as the Minister of Finance (Mr. Dunning) made a statement. I have never in all my experience in this house seen the committee of ways and means start on a schedule just as fast as we have started on this, by the chairman calling item 1, without any statement whatsoever from the minister. If the minister is not quite clear as to the sort of statement we expect, it might assist him if I asked a few questions.
Has the minister been in close collaboration with his colleagues on every item of this section, or did one minister give certain concessions in the Canadian market without a correlated study by the minister directly concerned with concessions received ,by Canada? Is there any balance-sheet based on trade over any given period, whether that trade be trade as shown in the statistics of the Department of Trade and Commerce for the year ending December, 1937, or trade as reflected in the trade statistics as we receive them from our own bureau of statistics?
The minister might also tell us what sort of balance sheet he had in his mind. He is more or less a trained man who, when he looks at a business transaction apart from political considerations, would first give some thought to what we are getting and what we are giving.
I have a full realization, Mr. Chairman, of all the political and other considerations which the minister finds it necessary to carry in his mind, of the good that treaties of this kind may do when negotiated between two democratic countries like Canada and the United States, so closely associated in so many ways, and also of the cooperation that we gave to help the mother country make a trade agreement with the United States. I have all that in mind, but there is another

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feature, and that is the cold-blooded figures of the balance sheet. That is what we do not have, and I say to this government that they have not been entirely fair to the Canadian people.
I say to the members of this house: You do not know what you are passing in this agreement in dollars and cents. I will put it the other way: Leave out everything else, and I ask, do you know what you are passing in dollars and cents? Have you the information in front of you? Do you not agree with me, Mr. Chairman, that the hon. Minister of Trade and Commerce, with all the assistants and executives he has around him, is the man who should be charged with the responsibility of letting us know what we are doing here?


Mr. EULER:: Give us a chance.


Joseph Henry Harris: It is true he made a speech in the house on the trade treaties in the month of January. 1939, when he apologized because he had only forty minutes and all that sort of thing. But this trade treaty is not limited to the month of January, 1939, and in all fairness to those of us who are at least trying to gather some sort of idea whether this trade treaty is fair and equitable, we should have more information.
In the very document which the Prime Minister tabled on the day these trade treaties were introduced, there was a tabular statement. That tabular statement should have been in our hands six or eight weeks before that. My second observation is this, that that tabular statement, as the minister well knows, when it comes to the concessions which the United States gives to Canada, gives the dollar value of the commodity affected. There is, on the other hand, no similar tabular statement given us by this government as to the amount of goods affected during any particular period by the concessions given by Canada. Why should those of us who are interested in this have to work out the calculation for ourselves, and then not know how the treaties were negotiated? This is what the Minister of Trade and Commerce received for Canada; these are the concessions, taken off as accurately as they could be by clerks and a couple of boys at the university of Toronto who have taken postgraduate courses in commerce and finance and have no political ends to serve. On all items over $25,000, based on the trade of Canada for the year ending March 31, 1938, we have given concessions double in dollar value what we are receiving. That is without
touching excise tax; when excise tax is added, our concessions are treble what we have received.
I complain about this procedure, Mr. Chairman, that you call item No. 1, and the minister is going to slip these items through one after the other, while we who in this House of Commons are charged with responsibility to the Canadian people are not clear as to what we are doing on the hard basis of dollars and cents. The minister has made clear his sentiments about negotiating this deal on behalf of democracy and all that sort of thing, but do we know what we are entitled to know? Has the government, in following the old procedure of holding back information to the very last minute, acted quite fairly towards us? They held back the treaty until it was signed and then gave their press releases. Take this so-called tabular statement of tariff changes; why is this information held back until the matter is introduced in the house and the minister takes his place in this chamber to pass the individual items? That is not giving us a fair opportunity to study this treaty.
Our good friend the United States, as is well known, do not do business in that way. They treat these business matters on a business basis, and I think it is time-never mind the past, "it was done this way before," and all that sort of thing-we had a little more business principle injected into the procedure in this chamber, particularly when we have a problem of this kind, which it is so easy to put in the form of dollars and cents so that he who runs may read. Yet we have not the facts in that particular form.
I am sorry that I have to ask the minister all these questions. I should have liked to see him give the committee a statement and avoid the necessity of asking for this information; but in the absence of it I feel, upon my responsibility as a member of this house, that before the minister goes on with the items, I must ask him to give us some idea as to how they were negotiated, tell us why the less amount of duties payable on goods going into the United States is $2,400,000, while the less amount of duties payable on goods coming into Canada is $5,130,000 and the less amount of excise payable on goods coming into Canada will be anywhere from ten to fifteen million dollars; why on the one hand we should give away from our exchequer some fifteen million dollars, and why on the other the concessions made by the United States amount to only two and a half million dollars. At the same time he should have taken us into his confidence and told
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us why the Canadian people - have not been given some idea of what has been going on, so that they could have made representations before the pact was signed, and would have been able to judge better the consequences of it to Canada. Before proceeding, I should appreciate it greatly if the Minister of Trade and Commerce would tell us what he has to say in that regard.


William Daum Euler: The Minister of Trade and Commerce does not think that this is the moment to make a general resume of the whole agreement. As a matter of fact, as the committee well knows, we spent probably a week in discussing the resolution, and the general aspects of the trade agreement were pretty fully dealt with at that time. The hon. member made reference to what was done by the Minister of Finance (Mr. Dunning) when schedule I was being considered. As a matter of fact, no preliminary statement was made by the Minister of Finance. He was not in the house when the first items were passed and carried.


Joseph Henry Harris: If I may interrupt, do not let us again have to refer to the fact that all of us were sorry to see the Minister of Finance so much as introducing the measure; we all had a great deal of sympathy for him, knowing he was not as well as he would like to be. As I said in my remarks yesterday, I stayed away from here for two days on account of the government placing the Minister of Finance in the position of putting this particular measure through the house.


William Daum Euler: I do not propose to take refuge behind anything that the Minister of Finance may or may not have done. I would merely repeat that in a general way the agreement has been discussed directly in this house by hon. members in the debate on the address in reply to the speech from the throne and again when the resolution was introduced.
My hon. friend speaks of the minister slipping these items through. There is no intention on the part of the minister, even if he could, to do anything of the kind. He cannot do it even though he wanted to. I should be glad enough to see the items go through quickly, especially in view of the fact that in any event no change can be made in them, but there is certainly no intention on the part of the minister to try to choke off discussion.
I reiterate that it seems to me that now, since we are in committee, we ought to discuss this item by item. My hon. friend has asked 
for a sort of balance sheet or a statement of debits and credits as to the amount of business affected in our imports and our exports. I think all that was pretty well dealt with; but if he is going to expect me to say that, when one particular item was negotiated with United States representatives, we would then say, "Now we are going to get so much on this item and we are going to give so much on the other item" and try to strike an absolute balance, I am sure that every intelligent man in the house-and they are all intelligent-must know that such is absolutely impossible.


Joseph Henry Harris: All intelligent except me, I suppose.


William Daum Euler: No. I give my hon. friend credit for having about as much intelligence as anyone else in the house, and he knows it would be impossible for me to do anything of the sort. Trade agreements are not made in that wTay. I have not had so great an experience in connection with them, and perhaps he has not either; but I assure him it is not possible that a man shall sit down and say, "You give me this; I give you that"; then, "You give me this; I give you that" and so on, going through the whole schedule. That is not the procedure.
As to the amount of business affected in dollars and cents, that has been given before. But I would again say to the committee, in all fairness, we are now in committee dealing with the items one after another, and I shall be glad, as hon. members ask for the information, to give them all the information in dollars and cents and in any other way it is possible for me to give full information on each item as we discuss it. I think that is a fair attitude to take.


Joseph Henry Harris: The minister is quite ready to give the figures on each and every item. If he has the figures on each and every item, of course he has the figure for all the items, that is the grand total. Could he give us the grand total before he starts in: how much trade is affected; how much less in duties there is to be paid by the Canadian people on goods shipped into the United States; and in like manner, how much less duty the United States had to pay on shipments of goods into Canada?


William Daum Euler: I cannot give the information exactly as my hon. friend wants it. I shall not press the point that the hon. member is a little out of order in asking for that information on one particular item. He is

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entitled to all the information that can be given on the item itself and on the other items as we come to them. I was not prepared for a question of this sort, but I have a statement with regard to the concessions to us affecting 202 items, amounting to $327,000,000. The concessions which we gave affect approximately $280000,000. I do not know whether the hon. member wants that information, but it has been in printed form before the members of the house for weeks.


Joseph Henry Harris: Will the minister concede this? Will he have his department put in tabular form, item by item, the amount of business consummated as at March 31, 1938, or, if he wants to use the Washington figures, as I understand his commissioners did when in Washington, the amount of business consummated in their fiscal year, the amount of duty payable in the past year, and the amount of duty that will be payable under the new rates, giving information with regard to both imports and exports?


William Daum Euler: I can assure my hon. friend that has never been done before. While I do not want to enter into any comparisons or recriminations, I am sure it was not done in that way in 1932 when the other agreements were made. Besides, if I conceded what my hon. friend asks, we would be here for three or four weeks getting that information in tabular form. I think we ought to go on with the discussion of the item that has been called.


Joseph Henry Harris: The minister says we ought to go on with the item-


Frederick George Sanderson: Order. I agree with
the minister that we should follow the procedure which has always been observed in committee of the whole and take the schedule [DOT] item by item, beginning with the one that has been called.


Douglas Gooderham Ross: With regard to
item 1, which we are discussing, I submit that before we can properly discuss even this item, which is a concession given to Canada under the agreement, there are two things that we should have before us. In the first place we have been told by the Prime Minister himself that we have made no more concessions under this agreement than we were asked to make by Great Britain. In order that we, as members of this house, can properly judge that question, we should be given the information as to what concessions Great Britain asked us to make so that this tripartite treaty might be made. We have never had that information, although I have
asked for it several times. I have requested that it be tabled. We do not know what concessions Great Britain asked us to make. There are certain things that Great Britain asked us to do. That is one thing; and there is this other factor, where I think the smoke screen has been laid, that this treaty we are making is something entirely different from the trade agreement between Great Britain and the United States. Before we can discuss this item, we should know whether we have adequate concessions. We ought to have that information.


Frederick George Sanderson: Will the hon. member for St. Paul's please discuss item 1. He is not doing so.


Douglas Gooderham Ross: I have been talking about item 1, and I say that before we can intelligently discuss it as part of the treaty we should have the information which I have asked for time after time.


Thomas Langton Church: I wish to ask this question regarding this item and all others. Was there any consultation with business or labour or agriculture before this change was entered into? It seems to me the change is for the benefit of the United States. Did the minister do what was done at Washington? There they consulted industry, labour, business and agriculture and gave them a chance. I submit that when we are dealing with something of this great importance and magnitude, those who are affected have a right to be heard. What steps did the minister take to notify the Canadian interests I name, concerned? At Washington they had thirty days in which to file objections and three months to appear before a board. Even admitting the difference in constitution and functions between the two governments, surely in a matter of this magnitude, before such far-reaching hundreds and hundreds of changes are brought about, those who are vitally affected should be consulted.


William Daum Euler: I can answer my hon. friend very briefly. The producers of this item made representations to the government to try to obtain this concession. It is a concession of 50 per cent. The tariff is reduced from If cents to | cent in one case and in the other from 1J cents to 1 cent. This was secured as a direct result of representations made by Canadian producers. It has been done for the benefit of the Canadian producer.


Mr. BARBER:: What firms or companies asked for the reduction? Where is the main production in Canada?
2198	COMMONS
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William Daum Euler: I can hardly give the names of the firms. There are only one or two, located in the province of Quebec.


Harry James Barber: None in British Columbia?


William Daum Euler: No.


Mr. WALSH:: What I have to say on
this item has reference generally to the whole treaty. My remarks can be applied to this particular item, and I put them forward as a suggestion, and a hope that in future trade agreements we may avoid the discussion that has taken place here to-night. The question has been asked, to what extent the people interested in this particular item were consulted? Were they given an opportunity to make representations? Were they advised that this item was one which was under consideration, as happened in the United States? When the people on the United States side of the line are drawing up a treaty of this kind or entering into negotiations, as the minister well knows, every item in their part of the treaty that is going to be affected was discussed with those interested, and the people manufacturing the product in the United States, or who might be directly or indirectly affected, were consulted long before the people representing Canada were negotiating with the government of the United States. I have in my hand an extract from volume 48, part 1, Public Laws of the United States, 1933-34, with particular reference to the Tariff Act of 1930 amendment approved June 12, 1934 -it even gives the time of approval, 9.15 p.m. I read section 4:
Before any foreign trade agreement is concluded with any foreign government or instrumentality thereof under the provisions of this act, reasonable public notice of the intention to negotiate an agreement with such government or instrumentality shall be given in order that any interested person may have an opportunity to present his views to the President or to such agency as the President may designate, under such rules and regulations as the President may prescribe; and before concluding such agreement the President shall seek information and advice in respect thereto from the United States tariff commission, the Departments of State, Agriculture and Commerce and such other sources as he may deem appropriate.
So we see that the negotiators on the part of the United States are carefully circumscribed by certain provisions that prevent their industries from being injured without fair opportunity being given to make representation beforehand in proper quarters. In other words, those negotiating the treaty for the United States are better armed than those negotiating the treaty on behalf of Canada. 
In particular reference to this item 1, and with reference generally to all items in this treaty, I claim and maintain that those interested in the various items in Canada were not given the same opportunity as those in the United States, and I am asking the government to give consideration to the possibility of incorporating into our law what they have in the laws of the United States, something that will give our people a better opportunity to make their views known to the government long before the terms of a treaty are negotiated and signed and come into effect. I think that is a fair and reasonable suggestion, it is a proposition that I have urged on previous occasions and one which I think should commend itself to every hon. member, as it certainly does to everyone engaged in business and industry in Canada.


James Alexander Marshall: I should like to ask
the minister a couple of simple questions in order to get this clear in my mind. With reference to the last two columns of figures, under the heading of "Value of United States imports 1937 (preliminary)," what is the meaning of the word "preliminary," and also what is that total of S3,875? Is that the total amount of imports into the United States?


William Daum Euler: Yes, it is described as imports.


James Alexander Marshall: From all countries?


William Daum Euler: Yes, and then there is a column headed "From Canada"; one column for the total imports and the other for imports from Canada.
I should like to reply for a moment to the hon. member for Mount Royal (Mr. Walsh). I cannot quite grasp the point he desires to make. If he had made the argument which he has just made when we were on schedule I, concessions proposed to be made to the United States on imports into the Canadian market, possibly injuring Canadian producers,
I could understand his argument. But this is a case where we are obtaining advantages for Canadian producers in the United States market. We are trying to do something for these people. This was done at the request of the Canadian producers. We tried to please them and I think we have helped. I do not see how anyone could possibly be injured as my hon. friend charges. If he said, now here is an intention to bring in this particular commodity at a lower rate of duty into Canada, I could understand it. But the shoe is on the other foot; we are making it easier for the Canadian producer to sell these goods in the United States. Surely there is not muck

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wrong with that, unless he might say we ought to have had a still further reduction. But we got it as low as it was possible to get it.


Harry James Barber: Were there any exports to Great Britain under this item 1? If so, what quantity? And were there any imports from Great Britain? Would the minister give the exports to and imports from the United States, and also the tariff on this product entering Canada?


William Daum Euler: I am not sure that I can remember all my hon. friend's question. There are no exports recorded to Great Britain, I am informed. The imports were about $3,600, all from the United States. There are no imports from Great Britain.


Harry James Barber: What is the United States tariff on this item?


William Daum Euler: It is all there right before my hon. friend.


Harry James Barber: Then what is the rate entering Canada from the United States?


William Daum Euler: 
Joseph Henry Harris: Is this vinegar edible under item 1? The item is acetic acid, not more than 65 per cent; and again, more than 65 per cent.


William Daum Euler: No, it is not edible.


Joseph Henry Harris: The minister probably knows that this item was free of all duty going into the United States under the United States Tariff Act, 1931. Why did they not take all the duty off again?


William Daum Euler: No, it was not free. Under the Fordney-McCumber tariff of 1932 it was i cent a pound just as it is now; under the Hawley-Smoot tariff, If cents; under the 1935 trade agreement, If cents; and it now becomes i cent a pound.


William Allen Walsh: Can the minister say whether there was any noticeable increase in the export of this item to the United States during the first two months of the current calendar year?


William Daum Euler: I have not the figures for that.


William Allen Walsh: Would those figures be available from the bureau of statistics? I suggest that these items would go through with a good deal more facility if hon. Liberal members opposite would give a little more attention to the items and less attention to amusing themselves.


Mr. HOWARD:: If the hon. member-


William Allen Walsh: If the cap fits the hon. member for Sherbrooke (Mr. Howard), let him sit down.


Charles Benjamin Howard: If the hon. member directs that remark to me, let him tell me whether he objects to this reduction in the United States duty.


William Allen Walsh: I object to the silly nonsense on the part of the hon. member for Sherbrooke and others on that side of the house.


Charles Benjamin Howard: I think, Mr. Chairman, the hon. member might withdraw that remark.


Frederick George Sanderson: I think the hon. member knows it was unparliamentary, and I am sure he will withdraw it.


William Allen Walsh: I always withdraw anything that is unparliamentary, but I hope it will lead to better decorum.


[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.
Item agreed to.
United States tariff-10. Fir or Canada balsam, natural and uncompounded, and not containing alcohol: 5 per cent ad valorem.
Item agreed to.
United States tariff-11. Synthetic resins made in chief value from vinyl acetate, not specially provided for: 3 cents per pound and 15 per cent ad valorem.
Item agreed to.
United States tariff-16. Calcium acetate, crude: J cent per pound.
Joseph Henry Harris: I imagine this is acetic acid using lime as a carrier. Has the minister the export figures for the two different grades of calcium acetate, the red and the gray?


William Daum Euler: No, I am not able to supply that.


Joseph Henry Harris: Would the minister tell us the duty on calcium acetate coming into Canada from the United States, and what our imports were from that country, if any?


William Daum Euler: It is free coming into Canada, and imports amounted to about $18.


Joseph Henry Harris: I should like to ask if the calcium acetate carries the same rate when it is used for fertilizer as it does when used in the manufacture of acetic acid.


William Daum Euler: If it is brought into Canada for the manufacture of fertilizer it comes in free.


Joseph Henry Harris: What was the rate in 1931?
2200	COMMONS
Canada-United States Trade Agreement


William Daum Euler: In 1930 it was one cent a pound.


Joseph Henry Harris: I notice no figure is given for the value of United States imports. I should like to ask if the 1937 preliminary figures were supplied by the Department of Commerce at Washington.


William Daum Euler: They are not available from United States records on this item, so we had to give them from our own records. As far as our records are concerned there were no exports at all.


Joseph Henry Harris: The figures as given in the Trade of Canada for the year ending March 31, 1937, show a trade amounting to 118,239
pounds.


Frederick George Sanderson: Shall the item carry?


Joseph Henry Harris: Before the item carries, I should like an answer to a bona fide question that I asked; that is, the value of United States imports. I should like to know if the figures in this tabular statement which has been supplied to the members are the figures which have been issued by the Department of Commerce at Washington in regard to United States trade.


William Daum Euler: They are, but in this instance there are no imports at all.


Joseph Henry Harris: Then, taking these figures, I say again what I said on a previous occasion, that by addition and subtraction the balance of trade against Canada last year was 8196,000,000.


[Stage Direction]
Item agreed to.
United States tariff-29. Cohalt oxide: 10 cents per pound.
Douglas Gooderham Ross: Is cobalt oxide controlled by a cartel?


William Daum Euler: Yes, the only Canadian
producer is a member of the international cartel.


Abraham Albert Heaps: What use are the tariffs in those instances?


William Daum Euler: Perhaps not very much.


[Stage Direction]
Item agreed to.
United States tariff-52. Sperm oil, crude: 2i cents per gallon.
Item agreed to.
United States tariff-52.	Shark oil and
shark-liver oil, including oil produced from sharks known as dogfish, not specially provided for: 10 per cent ad valorem.
Harry James Barber: What is the production in Canada?


William Daum Euler: In 1936 it was 176,586 gallons.


Abraham Albert Heaps: Are we on the first or second item 52?


Frederick George Sanderson: Item 52 carried.


Joseph Henry Harris: Mr. Chairman, I have before me item 52, and I was endeavouring to rise in my place and address the chair in order to ask a question. Will the minister explain the operation of section 601 of the Revenue Act, which is referred to in the tabular statement with regard to this item, and tell us what other items are affected by the tax of 3 cents a pound, and what kind of tax it is?


William Daum Euler: The products that are subject to the revenue tax are:
Whale oil (except sperm oil), fish oil (except cod oil, cod liver oil, and halibut liver oil), marine animal oil, tallow, inedible animal oils, inedible animal fats, inedible animal greases, fatty acids derived from any of the foregoing, and salts of any of the foregoing; all the foregoing, whether or not refined, sulphonated, sul-phated, hydrogenated, or otherwise processed, 3 eents per pound: Provided, That no whale oil (except sperm oil), fish oil, or marine animal oil of any kind (whether or not refined, sulphonated, sulphated, hydrogenated or otherwise processed), or fatty acids derived therefrom, shall be admitted to entry, after June 30, 1939, free from the tax herein provided unless such oil was produced on vessels of the United States or in the United States or its possessions, from whales, fish or marine animals and parts thereof taken and captured by vessels of the United States.
I am not sure whether that is the information my hon. friend wants.


Joseph Henry Harris: That is it exactly; thank you. When they were dealing with the Revenue Act of 1932 and the Revenue Act of 1936, which was an amendment, what happened to the other items the minister has just enumerated? Were any representations made in connection with them?


William Daum Euler: We could deal only with items of which we were the chief source of supply, and that did not apply in these other instances.


[Stage Direction]
Item agreed to.
United States tariff-58. Distilled or essential cedar-leaf oil, not containing alcohol: 12J per cent ad valorem.
Item agreed to.
United States tariff-71. Gas black, includ-ngg carbon black, and acetylene black, dry or ground in or mixed with oil or water, and not specially provided for: 10 per cent ad valorem.
Item agreed to.
United States tariff-81. Sodium chloride or salt:
In bags, sacks, barrels, or other packages: 7 cents per 100 pounds.
In bulk: 4 cents per 100 pounds.
Item agreed to.

Canada-United, States Trade Agreement
United States tariff-201(a). Fire brick, not specially provided for: 12J per cent ad valorem.
Item agreed to.
United States tariff;;-201(b).	Brick, not
specially provided for, not glazed, enamelled, painted, vitrified, ornamented, or decorated in any manner: $1 per 1,000.
Item agreed to.
United States tariff-203. Limestone (not suitable for use as monumental or building stone), crude, or crushed but not pulverized: 2i cents per 100 pounds.
Item agreed to.
United States tariff-203. Lime, not specially provided for: 5 cents per 100 pounds, including weight of container.
Item agreed to.
United States tariff-203. Hydrated lime:
6 cents per 100 pounds, including weight of container.
Item agreed to.
United States tariff-205(d). Cement, not specially provided for: 10 per cent ad valorem.
Item agreed to.
United States tariff-207. Bentonite:
Unwrought and unmanufactured:	75 cents
per ton.
Wrought or manufactured: $1.62J per ton.
Item agreed to.
United States tariff-207. Crude feldspar: 25 cents per ton.
Item agreed to.
Abraham Albert Heaps: Could the minister give us an idea of the total production of this mineral in Canada?


William Daum Euler: In 1937, 21,330 tons (crude and ground).


Abraham Albert Heaps: What is the value per ton of that commodity?


William Daum Euler: There is a total value of $178,160.


Joseph Henry Harris: On a point of order; I feel that the item should be read. That has been the procedure for many years. Item 207, respecting crude feldspar, should be read.


Frederick George Sanderson: There are two items numbered 207, the first of which has been passed. We are now' discussing the second one, respecting crude feldspar.


Joseph Henry Harris: And on the item respecting crude feldspar I base my point of order. I would make this observation: Articles contained in this schedule, such as crude feldspar
which appears in the list of concessions by the United States, under schedule II, represent a better opportunity for Canada to get her products into the United States. We welcome that, very much. But crude feldspar and all other items in the schedule seem to be commodities which have a minimum of Canadian labour in them; they have a minimum of highly skilled labour, whereas in schedule I, goods coming into Canada on which concessions have been given, there seem to be items which have a maximum of labour content in them.


[Stage Direction]
Item agreed to.
United States tariff-208(f). Untrimmed phlogopite mica from which no rectangular piece exceeding two inches in length, or one inch in width may be cut: 10 per cent ad valorem.
Item agreed to.
United States tariff-208(g). Phlogopite mica waste and scrap valued at not more than 5 cents per pound: 15 per cent ad valorem.
Item agreed to.
United States tariff-208(h). Mica, ground or pulverized: 15 per cent ad valorem.
Harry James Barber: What is the Canadian production of this item?


William Daum Euler: In 1937 there were 93,699 pounds of mica, rough cobbed; 206,757 pounds of knife trimmed; 172,774 pounds of thumb trimmed; 72,500 pounds of splittings; 1,252,887 pounds of scrap, and all of these have a total value of $132,011.


[Stage Direction]
Item agreed to.
United States tariff-209. Talc, steatite or soapstone: Ground, washed, powdered, or pulverized (except toilet preparations), valued at not more than $14 per ton: 174 per cent ad valorem.
Item agreed to.
United States tariff-214. Ground feldspar: 15 per cent ad valorem.
William Allen Walsh: In connection with item 214 I notice the value of United States imports in 1937 was zero. Has that been the same value for a number of years, or is it just significant for that particular year.


William Daum Euler: Apparently there has never
been any large quantity exported from Canada to the United States. In 1936 there was $301 worth. The duty has been so high that it has not been possible to export.


William Allen Walsh: Is it because of lack of machinery in this country to produce ground feldspar, or is it the duty?
2202	COMMONS
Canada-United States Trade Agreement


William Daum Euler: We have producers of ground feldspar in Canada. But the duty of 30 per cent was apparently too high to enable it to get into the United States market.
United States tariff-301. Spiegeleisen containing more than one per centum of carbon: 75 cents per ton.


[Stage Direction]
Item agreed to.
William Allen Walsh: That is the point I wish to make. Item 207 which has been passed refers to crude feldspar, and in connection with that item quantities have been exported. We are now dealing with ground feldspar, without any exports at all. Apparently the people of the United States are willing to import the crude product, but they are not willing to import feldspar on which work has been done. Is that the correct inference, or have I gone up the wrong alley?


William Daum Euler: I think the correct inference is that the people of the United States are apparently willing to let us send in some ground feldspar, because they have reduced the rate from 30 per cent to 15 per cent.


[Stage Direction]
Item agreed to.
United States tariff-214. Ground nepheldne syenite: 15 per cent ad valorem.
that, if in any calendar year after 1938 the aggregate quantity of nepheline syenite m any form, whether dutiable or free, entered, or withdrawn from warehouse, for consumption exceeds 50,000 tons, the government ot the United States of America and the government of Canada shall promptly enter into consultation, with a view to reaching an agreement as to whatever measures may be deemed appropriate, and if, within 60 days after the two governments enter into consultation, a inutually satisfactory settlement has not been effected, the government of the United States ot America shall have the right to increase the duty on any nepheline syenite which is subject to duty and to impose a customs duty on any nepheline syenite which is not subject to duty entered, or withdrawn from warehouse, tor consumption in any calendar year in excess of an aggregate quantity of 50,000 tons of nepheline syenite in any form.
Item agreed to.
United States tariff-214. Stone, not specially provided for (except marble chip or granito and Cornwall stone), ground, or crushed otherwise than merely for the purpose of facilitating shipment to the United States: 15 per cent ad valorem.
Item agreed to.
United States tariff-214. Dead-burned basic refractory material containing 15 per centum or more of lime and consisting chiefly of magnesia and lime: 20 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 (GO Treasury Decisions 114) shall be continued during the effective period of this agreement.
Item agreed to.

United States tariff-302 (d). Ferromanganese containing not less than 4 per centum of carbon, on the metallic manganese contained therein: f cent per lb., plus 1J times the lowest rate of ordinary customs duty provided for manganese ore containing in excess of 10 per centum 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 If cents per pound.
Item agreed to.
United States tariff-302 (i)	Ferrosilicon,
containing 8 per centum or more of silicon and less than 30 per centum: one cent per pound on the silicon contained therein.
Item agreed to.
United States tariff-302 (k). Ferrochrome or ferrochromium containing 3 per centum or more of carbon: 14 cents per pound on the chromium contained therein.
Item agreed to.
United States tariff-302(1). Boron carbide: 124 per cent ad valorem.
Item agreed to.
United States tariff-302 (m). Ferrotitanium, ferrovanadium, and ferrouranium: 15 per cent ad valorem.
Item agreed to.
United States tariff-304. Hollow bars and hollow drill steel, valued above 8 and not above 12 cents per pound: 20 per cent ad valorem.
Provided, that the duty assessed under this item shall not 'be less than If cents per pound.
Provided further, that no article assessed with duty under this item shall be subject to a separate additional duty under the second proviso to paragraph 304 of the Tariff Act of 1930.
Item agreed to.
United States tariff-318. Woven-wire cloth: Gauze, fabric, or screen, made of wire composed of steel, brass, copper, bronze, or any other metal or alloy, not specially provided for:
With meshes not finer than thirty wires to the lineal inch in warp or filling: one cent per square foot, but not less than 124 nor more than 25 per cent ad valorem.
With meshes finer than thirty and not finer than ninety wires to the lineal inch in warp or filling: 5 cents per square foot, but not less than 20 nor more than 40 per cent ad valorem.
Item agreed to.
United States tariff-323. Axles and parts thereof, axle bars, axle blanks, and forgings for axles, of iron or steel, without, reference to the stage or state of manufacture, not specially provided for, valued at not more than 6 cents per pound: %o cent per pound.
Item agreed to.
United States tariff-327. Cast-iron fittings for cast-iron pipe: 15 per cent ad valorem.
Item agreed to.

Canada-United States Trade Agreement
United States tariff-327. Cast-iron and irons, plates, stove plates, sadirons, tailors' irons, hatters' irons, but not including electric irons, and castings and vessels wholly of cast iron, including all castings of iron or cast-iron plates which have been chiseled, drilled, machined, or otherwise advanced in condition by processes or operations subsequent to the casting process but not made up into articles or parts thereof, or finished machine parts:	10 per cent ad
valorem.
Item agreed to.
United States tariff-327. Moulders' patterns, of whatever material composed, for the manufacture of castings: 25 per cent ad valorem.
Joseph Henry Harris: Would the minister make
a statement with respect to item 327, dealing with moulders' patterns for the manufacture of castings? Who asked for the concessions on moulders' patterns? Is this a request from the United States so that they may get. our patterns into that country cheaper to make our castings for us from those patterns, or was this a request from Canadian manufacturers, Canadian foundries or Canadian producers of castings?


William Daum Euler: The request came from
Canadian producers.


Joseph Henry Harris: Producers of castings?


William Daum Euler: No, not of castings, but of
patterns.


Joseph Henry Harris: I understand the request
*edme from Canadian producers of castings-


William Daum Euler: Of patterns.


Joseph Henry Harris: Of patterns, so that patterns may be let into the United States for the manufacture of castings, at half the previous rate. This is just another example of where, through the negotiation of this treaty and the one which preceded it, an industry will be unable to take up its fair share of employment, and will be unable to take off the streets of Canada some 40,000 iron and steel workers. It is another example, where moulders' patterns, which those workers use in their handicraft or their work, will go into the United States at a lesser rate of duty. I have in my mind's eye the fact that perhaps a great number of castings will be coming back into Canada. It shows clearly to my mind that the Department of Labour, and the minister who is supposed to be charged with the responsibility of attempting to find employment for our people, have not been in dose cooperation with the Minister of Trade and Commerce, when he found it necessary to give this particular concession.


William Daum Euler: I do not wish to argue the
point, but the only comment I would make is that if these patterns were not made in Canada there would be just that many more unemployed people.


[Stage Direction]
Item agreed to.
United States tariff-329. Chain and chains of all kinds, made of iron or steel:
Less than f and not less than | of one inch in diameter: J cent per pound.
Less than J and not less than 5/16 of one inch in diameter: li cents per pound.
Harry James Barber: What would the ad valorem rate on this item be?


William Daum Euler: Thirteen or fourteen per
cent.


[Stage Direction]
Item agreed to.
United States tariff-353. Washing machines, having as an essential feature an electrical element or device, and parts thereof; any of the foregoing, finished or unfinished, wholly or in chief value of metal, and not specially provided for: 17i per cent ad valorem.
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: 17J per cent ad valorem.
Item agreed to.
United States tariff-370. Motor boats, including yachts or pleasure boats, whether sail, steam, or motor propelled, valued at not more than $15,000 each: 15 per cent ad valorem.
Item agreed to.
United States tariff-374. Aluminum, aluminum scrap, and alloys (except those provided for in paragraph 302 of the Tariff Act of 1930) in which aluminum is the component material of chief value, in crude form: 3 cents per pound.
Douglas Gooderham Ross: Is aluminum controlled by an international cartel?


William Daum Euler: Not so far as we are aware.


Douglas Gooderham Ross: I understood it was controlled by an international cartel. All I am getting at is this:	It really is not any
concession to Canada to have the duty on aluminum reduced ?


Abraham Albert Heaps: What is the total production of aluminum in Canada?


William Daum Euler: There is only one producer and we have not the statistics.


Abraham Albert Heaps: It is a United States concern, is it not?
2204	COMMONS
Canada-United States Trade Agreement


William Daum Euler: It is called the Aluminum Company of Canada.


Abraham Albert Heaps: Who controls it?


William Daum Euler: I do not know.


Abraham Albert Heaps: Surely the minister knows.


William Daum Euler: They claim that they are not controlled by United States interests.


Abraham Albert Heaps: They may claim that, but it is really United States capital.


William Daum Euler: I cannot concede that because I do not know.


Abraham Albert Heaps: It is commonly stated that the Mellon interests control it.


William Daum Euler: In any event they employ Canadian workmen and use Canadian materials.


Abraham Albert Heaps: Personally I would say it is no particular concession that we are receiving from the United States. It is simply a little cross-play between the parent company in the United States and the subsidiary company in Canada.


[Stage Direction]
Item agreed to.
United States tariff-378. Cadmium: cents per pound.
Item agreed to.
United States tariff-389. Nickel, and alloys (except those provided for in paragraph 302 or 380 of the Tariff Act of 1930) in which nickel is the component material of chief value, in pigs or ingots, shot, cubes, grains, cathodes, or similar forms: 2£ cents per pound.
Douglas Gooderham Ross: Is this product controlled by an international cartel?


William Daum Euler: I am informed not. There are only two producers in Canada.


John Ritchie MacNicol: Does the nickel all go out in blocks or bars, or in the raw state?


William Daum Euler: I am told that it goes out in the primary forms, in pigs or ingots.


John Ritchie MacNicol: That is what I had in mind, and it is reduced at Port Colbome, is it not?


William Daum Euler: Yes.


[Stage Direction]
Item agreed to.
United States tariff-393. Zinc-bearing ores of all kinds, except pyrites containing not more than 3 per centum zinc: 11 cents per pound on the zinc contained therein.
Item agreed to.

United States tariff-394. Zinc in blocks, pigs, or slabs, and zinc dust:	cents per pound.
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 thousand feet, board measure.
Harry James Barber: What is the Canadian tariff against United States lumber coming in, the comparable item with this?


William Daum Euler: On planks not further manufactured than sawn or split, the duties are free across the board; planks, sawn, split or cut, dressed on one side only, not further manufactured, free right across; planks, planed or dressed, on one or both sides, with edges jointed or tongued or grooved, 10 per cent ad valorem.


Harry James Barber: So it is free coming in from the United States, but Canadian lumber going into the United States must pay a 50 per cent tariff and also the $1.50 tax.


William Daum Euler: Yes.


Harry James Barber: That is no concession to Canada, no change there.


William Daum Euler: No change.


Mr. PERLEY:: Referring to paragraph (2) of this item in the tabular statement, there is a certain amount of exports from Alberta and Saskatchewan. Western white spruce is the main production in the northern parts of those provinces. Can the minister give the exports from these two provinces separately?


William Daum Euler: The figures are not separated.


Joseph Henry Harris: What are the terms of section 601 of the Revenue Act of 1932 referred to in this item as it appears in the tabular statement.


William Daum Euler: Section 601 covers:
Lumber, including sawed timber, rough, or planed or dressed on one or more sides, except flooring made of maple, birch, and beech, and except lumber and timber of northern white pine (pinus strobus), Norway pine (pinus resinosa), western white spruce, balsa, teak, cedar commercially known as Spanish cedar, lignum-vitae, lancewood, ebony, box, granadilla, mahogany, rosewood, satinwood, Japanese white oak, or Japanese maple: $1.50 per thousand feet, board measure.


Joseph Henry Harris: What is the date of the document from which the minister is reading?


William Daum Euler: I am reading from the trade agreement.

Canada-United States Trade Agreement


Joseph Henry Harris: He is not reading from the Revenue Act itself?


William Daum Euler: No.


Joseph Henry Harris: And sawed timber was not mentioned in the Revenue Act of 1932. I ask the minister, was it mentioned in the act of 1932.


William Daum Euler: It was included in the amendment of 1938.


Joseph Henry Harris: And in the intervening six years a certain amount of sawed timber did not pay the $3 tax prior to its being reduced to $1.50, and subsequently did not pay the $1.50 tax. Is that correct?


William Daum Euler: Yes.


Joseph Henry Harris: So in getting the concession on sawed timber in the 1938 agreement, the government has permitted the United States to charge the $1.50 revenue tax which has not applied since 1932, and which since 1938 applies on sawed timber going into the United States. Is that a fact?


William Daum Euler: The amount involved is
very, very small, I am told.


Joseph Henry Harris: The question that runs
through my mind all the time in connection with the negotiation of this agreement is this: Whom are we working for? Are we working for Canada or for the United States?


William Daum Euler: For Canada.


Joseph Henry Harris: Well, here is an example. This item of sawed timber bore no revenue tax in 1932 under section 601 of the Revenue Act of 1932. It is amended in 1938, and we see to-day that this schedule is changed to make sure that timber going into the United States does pay $1.50. My other question is this: When does this $1.50 tax expire?


William Daum Euler: It expires in June of this year,


Joseph Henry Harris: Has Canada agreed to make a further relinquishment of its guaranteed British preferences if and when in June of this year the United States repeals the import tax on Canadian lumber? I am sorry that the Minister of National Defence (Mr. Mackenzie) is not here because he devoted a part of his speech in the debate on the address to this subject.


William Daum Euler: The answer to my hon.
friend's question is yes.


Joseph Henry Harris: In other words, this is
another concession given to the United States by way of the back-door. The United States, in other words, will be able to get
her products into the British market, products of a kind which we produce here in abundance, and our lumber industry finds its preference in the British market narrowed. Of course I know that the minister will immediately reply that its market in the United States is widened. Again I ask, whom are we working for in this agreement, for Canada or for the United States?


William Daum Euler: My hon. friend must know that unless they do take the tax off they get nothing more. If they take the tax off, there is something given by both sides.


Joseph Henry Harris: I very well remember the Minister of National Defence rising in his place and saying to this house that he expected that in June, 1939, the United States would take off the $1.50 revenue tax; but he did not say at the same time, as the Minister of Trade and Commerce now tells us, that in view of that concession, if he so calls it, we in Canada get the preference narrowed that we now have in the British market for the same lumber.


William Daum Euler: We still have in the British market a preference of about $2 a thousand feet.


Joseph Henry Harris: But the government has
agreed to relinquish some of that.


William Daum Euler: That preference remains
unless the United States throws off the $1.50 tax, which is of some value.


Joseph Henry Harris: I ask the question why, then, a responsible minister of the crown, the Minister of National Revenue, would give us just a half-truth in a statement of this kind. That is all it was. He said they take off the $1.50 in June, 1939. All right; why did he not go on and say, as the Minister of Trade and Commerce says now, if they do that we are going to relinquish some of our preference in the British market?


William Daum Euler: I should be very much surprised if the Minister of National Revenue made that definite statement in that way.


Joseph Henry Harris: The Minister of National Defence. The British Columbia minister.


William Daum Euler: My hon. friend said in error a moment ago, the Minister of National Revenue.


Joseph Henry Harris: I am sorry. I apologize. I mean the Minister of National Defence, the minister who in this government represents British Columbia. British Columbia is vitally interested.
2206	COMMONS
Canada-United States Trade Agreement


William Daum Euler: I was not here. I do not know. I should think if he stated that that tax would come off, the statement was made conditionally; that is, the two things would go together. The United States would be placed on an equality with Canadian lumber in the British market provided they took off the $1.50 tax.


Mr. GREEN:: Have the government made any representations to the United States government that this revenue tax, or, as it is sometimes called, this import excise tax of $1.50 a thousand feet should be removed now or at any rate should not be renewed in June of this year, thereby bringing into effect the second stage of the lumber bargain? As the minister knows, this lumber bargain is the only part of the whole trade treaty which has not yet been concluded by both parties, and I think our government might have some effect on the United States government if they pointed out the unfairness of leaving the lumber bargain in the first stage, where it is at the present time.
In this first stage Canada has made certain concessions. I do not intend to enumerate them in detail, but roughly-I would ask the minister to correct me if I am wrong-they are that we have given up a portion of our preference in the United Kingdom and in the West Indies; we have agreed to give up a portion of our preference in Australia, New Zealand and South Africa, and we have reduced the duty on dressed lumber coming into Canada from United States by fifty per cent, as well as taking off the excise tax. I do not think it can be argued successfully that Canada has got fair compensation for those concessions in this first stage of the lumber bargain. Further than that, these concessions have been made almost exclusively by the British Columbia lumbermen. The concessions do not affect the eastern lumbermen, but they do affect, and vitally so, the lumbermen on the Pacific coast.
Then, in the second stage we have to make further concessions, and I believe that in that stage as well British Columbia is doing most of the sacrificing. But because of the unfairness of the first stage, I earnestly ask the minister to have the government press the government of the United States to bring about the second stage by removing the import excise tax of $1.50 a thousand feet. Just this week I received the current copy, March, 1939, of the British Columbia Lumberman, which is the journal of the trade. On page 35 I find an article dealing with this lumber situation. I should like to read the 
concluding paragraph to the minister, because I think it sums up the situation fairly. It is as follows:
While the Americans receive the advantages in the immediate stage of the treaty, we hope that the "Good Neighbour" policy will apply both ways to the extent that we may enjoy a modest part of their domestic lumber market.
In other words, we in British Columbia are asking that the second stage be brought into force so that our lumber may get into the United States market and thereby make this deal fair to both.


William Daum Euler: I might point out if I cared to do so that my hon. friend from British Columbia seems to attach more importance so far as advantage to Canada is concerned to this second stage than did the hon. member for Danforth (Mr. Harris).


Howard Charles Green: I come from a lumber district.


William Daum Euler: Quite so. For the information of my hon. friend I would say the best indication that the Canadian government desire the bringing into force of the second stage of this lumber item is that they are offering that inducement regarding the British market, that the United States of' America will get into the British market on the same terms as Canadian lumber exporters, namely free, provided they take off the excise tax. That, I think, is the strongest proof that we are anxious that that should be brought about, perhaps more for the benefit of the British Columbia lumberman than anybody else. I should say also that the difficulty in the way is one which we did not experience in making the rest of the agreement. The agreement we made was made with the President of the United States, who had authority to reduce duties as much as fifty per cent on existing tariffs. With regard to the excise the situation is entirely different. That excise tax of $1.50 can be removed only by action of congress. That is why I say it is on an entirely different basis from the making of the other part of the agreement. But we have tried to make it acceptable to the United States congress by offering them free entry into the British market, that is on the same basis as Canadian lumber, if they will take off that $1.50 tax. What they will do I do not know. We may hope that they will do it, because I believe it will be to the advantage of British Columbia if that tax is removed.


Harry James Barber: What concession do they get now as regards the British market?


William Daum Euler: Sixteen shillings. It works out at about $2 a thousand. We will still have that advantage, reduced from ten per cent ad valorem.

Canada-United States Trade Agreement


Howard Charles Green: Is it not possible for the government at the present time to make representations to Washington, just as was done in the case of cattle, with regard to the second stage of the lumber bargain? It is quite obvious that the bargain is unfair if it is left in the first stage. I ask that the government point that out to Washington and ask them to make sure that the second stage is brought about.


William Daum Euler: Well, it is a matter for congress to take action upon. There is this difference so far as the cattle quota is concerned, that the provision for what was done with regard to the cattle quota was contained in the agreement, but the excise tax of $1.50 is a matter upon which action can be taken, not by the president, but only by congress. There is the difficulty, if difficulty there be.


Howard Charles Green: The position is that we have already bound ourselves to give away these concessions, and we have said to the United States, you can take it or leave it as you like.


[Stage Direction]
Item agreed to.
United States tariff-402. Maple (except Japanese maple), birch and beech, flooring: 4 per cent ad valorem.
Item agreed to.
United States tariff-405. Veneers of birch or maple: 10 per cent ad valorem.
Item agreed to.
United States tariff-406. Hubs for wheels, heading bolts, stave bolts, last blocks, wagon blocks, oar blocks, heading blocks, and all like blocks or sticks, roughhewn, or rough shaped, sawed or bored: 5 per cent ad valorem.
Item agreed to.
United States tariff-407. Casks, barrels, and hogsheads (empty), of wood, not specially provided for, but not including beer barrels or beer kegs:	per cent ad valorem.
Item agreed to.
United States tariff-412. Paint brush handles; broom handles and mop handles, further advanced than rough shaped, not less than three-fourths of one inch in diameter and not less than thirty-eight inches in length; tennis-racket frames valued at $1.75 or more each; toboggans; baby carriages; wheelbarrows; canoes and canoe paddles; carriages, drays, trucks, and other horse-drawn vehicles, and parts thereof, not specially provided for; and ice-hockey sticks; all the foregoing wholly or in chief value of wood: 20 per cent ad valorem.
Item agreed to.
United States tariff-503. Maple sugar: 3 cents per pound.
Item agreed to.
United States tariff-503. Maple sirup; 2 cents per pound.
Item agreed to.
United States tariff-701. Cattle, weighing less than two hundred pounds each, 1J cents per pound.
Provided, that such cattle weighing less than two hundred pounds each entered, or withdrawn from warehouse, for consumption in any calendar year after 1938 in excess of 100,000 head shall not be entitled to a reduction in duty by virtue of this item, but the rate of duty thereon shall not exceed 21 cents per pound.
Mr. ROSS (Moose Jaw):: On this item
I notice that there is no change between the 1935 treaty and the 1938 treaty in the amount of duty, but there has been a decided change in the number of head of ti ls class of cattle which can go into the United States; also the weight per head is increased by twenty-five pounds. That is a considerable concession to the cattle raisers of Canada.


George Halsey Perley: Could the minister give
us the number of head that have been exported under this agreement since the agreement came into force?


William Daum Euler: The figure is 6,310 up to February 25.


Henry Herbert Stevens: That is the first division of item 701. There are three divisions.


William Daum Euler: That is the first division, yes.


George Halsey Perley: Will the minister give the number exported during 1938?


William Daum Euler: Under the quota, 38,750 head.


George Halsey Perley: What percentage is that of the total slaughter in the United States?


William Daum Euler: I cannot give that information.


John Gordon Ross: One quarter of one per cent. I was speaking of the first of the sections under item 701. Under the second section, we used to be allowed, under the old treaty, 20,000 head, and now we are allowed an unlimited number. Under the third section, cattle weighing 700 pounds or more, while this treaty was under discussion, before we came to the items, my hon. friends had a great deal to say about the fact that there was a global quota. At that time I said that the cattle men of Canada did know there was a global quota. Since then I have looked the matter up, and I find that in 1936 the quota was filled in November. At that time Mexico had shipped about thirteen per cent of the quota into the United States and Canada had shipped in the balance. In 1937 the quota was filled in August, and again Mexico had shipped in

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something over thirteen per cent and Canada the balance. My hon. friend the member for Qu'Appelle, discussing this item the other day, deplored the fact that some one he knew, who had shipped a carload of cattle, was unable to come under the quota at that time, before it was filled for the first three months; and if I remember correctly, he said that the shipper had, on that account, received something like $500 less for the carload. He did not point out at that time that this concession on all cattle shipped into the United States-the concession received by this government-meant the same amount of money, $500, on practically every carload of cattle shipped by the Canadian cattle producer.
My hon. friends have always declared that the American was a tough dealer, tha t he wanted an eye for an eye.


Douglas Gooderham Ross: Two eyes for one, and he gets it.


John Gordon Ross: Well, this is an instance which proves that my hon. friends are wrong when they say that, because after this treaty had been signed, sealed and delivered, we find that this year, under the global quota which had been in effect since 1935, there were shipped from Mexico some 45 per cent of the cattle entering the United States under that quota. Prior to the time that anyone raised that question in the house, officers of the Department of Trade and Commerce had been in touch with the United States in reference to the matter. They were alive to the fact that more cattle than usual were being shipped from Mexico under the global quota. They went to the United States, and, without any eye for eye, the United States agreed to give Canada over 86 per cent of the shipments under that global quota, which means that Canada now has under this treaty something like 40,000 head more under the quota than the total global quota of 1935. This has been a great concession to the cattle raisers in this country, and it has proved that my hon. friends are entirely wrong when they say that the United States wants an eye for an eye. They have given us a concession here and have increased that concession, after having been asked by the Canadian government to do so; and they have not asked anything in return for it.


George Halsey Perley: The hon. member's mathematics are a little wrong. If he will take the quota of 155,000 head last year-and he says that this new agreement adds 40,000 to that-


John Gordon Ross: About 40,000 a year.


George Halsey Perley: If he takes 86 per cent of
155.000	head he will find that his figures do not agree with those given by the minister. The Minister of Agriculture (Mr. Gardiner) the other day, in a statement which he made to the house with respect to the new arrangement that had been made, said that our quota would now be based upon the percentage of shipments of the previous year, and he said it would make it possible for Canada to ship
142.000	head. Now the hon. member adds
40.000	to 155,000 and therefore he is a long way out.


John Gordon Ross: In reply to my hon. friend, may I point out that there are
225.000	head under the quota now and not 155,000; and 86 per cent, or a fraction over 86 per cent, amounts to 193,000 head a year, which is Canada's share under the quota now. In other words, that is almost 40,000 head more.


George Halsey Perley: The new arrangement is based on last year's shipment?


William Daum Euler: No, it is not.


George Halsey Perley: That is what the minister said.


William Daum Euler: No; it is based on the shipments of 1936-37. The year 1938 was not taken because it would not have been representative or so favourable to us. The United States accepted the shipments of 1936-37 in establishing the percentage of quota.


George Halsey Perley: Will the minister give the exports under the third item since the agreement came into force to date? The first quarter is not yet completed.


William Daum Euler: I can only give the division of the quota. Canada gets 51,720 head and other countries, 8,280.


Mr. ROWE (Dufferin-Simeoe):: That is not for the first quarter.


William Daum Euler: No; not for the first quarter.


George Halsey Perley: I am asking how many have been shipped to date in the first quarter.


William Daum Euler: There have been shipped 32,911, and Mexico shipped 27,000 odd. The quota was filled early in the quarter. In the future it will be on the basis of the quota of 86 per cent plus for Canada.


Mr. CASSELMAN:: It will be threequarters of 86 per cent for the year, because the first quarter's quota is gone. For the rest of the year, therefore, the increase is not 40 per cent, as the hon. member for Moose Jaw says.

Canada-United. States Trade Agreement


William Daum Euler: It will be from now on in
any ordinary year, or any given twelve months.


Mr. HAYHURST:: Is each quarter divided
equally? Is the amount of cattle that may enter the United States for any three months equal?


William Daum Euler: We can always export 86
per cent of 60,000 in each quarter except the last.


James Alexander Marshall: Has the minister given
any consideration to the position of those shippers who had cattle en route to the United States market when the quota was declared closed at the end of January?


William Daum Euler: If the quota was filled there was nothing to be done until another quota period began. I suppose they could put them in bonded pasture.


Percy John Rowe: Has the minister any record of any in bond now?


William Daum Euler: I am informed that there
are slightly over 500 Canadian cattle.


George Halsey Perley: What are the average
weekly shipments? Has the minister any record, for instance, of the exports last week?


William Daum Euler: There would not be any,
when the quota was filled in January.


George Halsey Perley: But they could pay the
three cents a pound.


William Daum Euler: I have no record of the
number. It is small.


Mr. LEADER:: I listened with much
interest to the debate on this trade treaty, particularly that part applicable to cattle. I did not say anything in that debate, but I want to say now that the concessions granted for the entry of Canadian cattle into the United States are of great benefit to the live stock growers; there is no doubt about that. The number under the old quota was 155,799; the quota has now been increased to 225,000. My Conservative friends took objection to this quota, and said that it would work a hardship, in fact had worked a hardship, with which I agree to a certain extent. But I believe that if we must have a quota at all, that quota must be regulated. A quarterly system means a certain amount of regulation, but in my opinion is not enough. I believe I mentioned in this house two years ago that this quota should be regulated on a monthly basis. I believed then that the time was coming when the United States itself would insist on a quota, as well as Great Britain.
If we had had a monthly quota we would not have got into the trouble we did in the
71492-13-9J
first quarter. As hon. members know, the quota was filled in the first month. I am in touch with the cattle men, and I know one man who had fourteen carloads of cattle just waiting until January 1 to ship them to the United States. I suppose there were hundreds who had the same idea, and the Mexicans also had the same idea, with the consequence that the quota was filled in one month, or early in February, really, but the information was given out that it was filled before the end of January. The effect was that they broke the market in the United States and broke it here in Canada, because the cattle that were in transit at the time had to be transferred to the Winnipeg and Toronto markets. A few weeks later the cattle market went up.
The same thing will be repeated at the beginning of April when the market opens up again; people will rush their cattle to market, and that quota may be filled in a month or two. I do not believe that we shall be able to fill our quota for the year. I believe it would be in the interest of the cattle men of Canada and the United States as well to regulate that quota on a monthly basis.


William Daum Euler: Does my hon. friend not
think there would then be a scramble each month instead of four times a year?


Harry Leader: There would unless there
was some regulation, but surely we can take enough interest in these matters to regulate the flow. It could be regulated much more easily on a monthly basis than quarterly.


William Daum Euler: I suppose my hon. friend
means that it should be regulated from this side.


Harry Leader: Yes.


George Halsey Perley: The hon. member who
has just spoken said that some of us on this side objected to the quota. There is no objection to the quota; I think it is a fine thing if we are sure we get our quota. We know this government got a little excited when they found the quota was filled and went over to the United States authorities and made new arrangements. When April 1 comes around, as the hon. member for Portage la Prairie (Mr. Leader) has said, there will be a rush again to fill the quota. If the Mexicans find they are not getting as much under the new arrangement as they expected, as they did last year and the first quarter of this year, is there any possibility of the Mexican government going to the
2210	COMMONS
Canada-United States Trade Agreement
United States and making a new arrangement with them which might upset the arrangement which this government has now made?


William Daum Euler: There is no provision for Mexican cattle in this agreement. They have no rights under it.


William Earl Rowe: Cattle
from any place in the world.
Mr. ROSS (Moose Jaw: They have a right to thirteen per cent.


Percy John Rowe: Mexico,
as well as all countries, has the right.


John Gordon Ross: But our right
is set at 86 per cent now.


William Earl Rowe: I suggest that the minister or someone representing the government might take another trip to Washington and see if it is not possible to arrange for a larger proportion in certain quarters. This treaty, it seems to me, offers to Canadian producers an opportunity to sell more cattle when they have less available and less when the market could take more. Surely the government did not figure that we could keep up a regular orderly supply the whole year round. On account of climatic conditions in this country we have more cattle to sell at some seasons than at others. If in any one quarter we do not have enough to fill the quota we are not allowed to make up the difference in another quarter. It should be a yearly quota. In the interests of the cattle producers of this country I suggest that the government should send another trade commissioner to Washington to make a third attempt to draw up a treaty which will be in the interests of the cattle producers. The results for the first quarter, as the hon. member has suggested, have not been very satisfactory to the cattle producers.


John Gordon Ross: They certainly were.


William Earl Rowe: But the
quota was filled in the first month. It was all right for the man who had them ready to sell at the beginning of January, but not so good for the man who had them ready later. I suggest that the quota should apply for the whole year. If we have more cattle to market in one quarter I think we should be allowed to apply them on the annual quota.


Harry Leader: Is not the main fault in the whole marketing system that we dump the product on the market in large quantities, and then next month or next year have

not enough to fill the requirements of the market? That is where a monthly quota would help. Our annual quota is 86-2 per cent of 225,000 cattle weighing over 700 pounds, and it is now regulated to the extent of a quarterly quota. My point is that it would be better if it were a monthly quota.


William Earl Rowe: We had better start the orderly marketing here before we accept control from another country.


Thomas Bruce McNevin: If you relieve the Canadian market of 42,000 head of cattle in three months, you will take that dead load off the market and we will get a very material benefit, because the effect of that will carry right through the period.


Karl Kenneth Homuth: Suppose we cannot fill our quota in any one quarter; can we ship an increased number in the next quarter?


William Daum Euler: No, we cannot.


Karl Kenneth Homuth: Then it is not a yearly quota.


William Daum Euler: It is not cumulative; we have to fill our quota each quarter.


Harry Leader: I do not understand that. We have an annual quota of 86-2 per cent of 225,000.


Harry James Barber: That is not in the treaty.


Harry Leader: The figures are right here.


Karl Kenneth Homuth: It is not a yearly quota.


Harry Leader: It is. The total imports are limited to 225,000, and we are allowed 86-2 per cent of that quota over the year.


William Daum Euler: Perhaps I might clear that up. If, for example, we were short in our quota in the second quarter; if we shipped only 40,000 head, for example, we would lose the difference between what we were entitled to ship and what we actually did ship. That is, we would lose that difference for that quarter, but we would be allowed to ship more in the final quarter because we would be entitled to 86-2 per cent of the global total of 225,000.


William Earl Rowe: But not more.


William Daum Euler: We could not ship more than
60.000	in any one quarter.	.


William Earl Rowe: Then how could we get in the other 20,000 in the last quarter? The treaty says no more than
60.000	in any one quarter.


William Daum Euler: That is quite clear; there is no question about that. If you have a shortage in any one quarter you cannot make

Canada-United States Trade Agreement
it up in the following quarter, because in no quarter can more than 60,000 cattle be sent by Mexico and Canada. That is perfectly true. I imagine that it will not be a very practical point; I believe the Canadians will fill their quota each quarter.


George Halsey Perley: The point might arise in some quarters of the year.


William Daum Euler: It might.


William Earl Rowe: I do not want to.be misunderstood as far as orderly marketing is concerned. I believe with the hon. member for Portage la Prairie that we should have more orderly marketing; in fact,
I think as long as ten years ago I suggested to this house that we should have an export board to control the orderly marketing of our products, and I believe that would be sound policy to-day. But I would prefer to see an orderly system of marketing controlled by this country instead of having our' marketing controlled by the tariffs of another country.
In following up what the hon. member for Portage la Prairie has said I would suggest to the minister that if we are going to be placed under certain restrictions each quarter, the time is now ripe, if not long overdue, to develop some plan by which we may have an orderly supply of cattle. I would not like to leave this in the lackadaisical way suggested by the minister, that we should trust the cattlemen of Canada to see that 60,000 head are shipped each quarter. I know in many parts of this country they market their cattle only at certain seasons of the year, while at other seasons none is sold. During March, April and May the winter cattle are sold and during September, October and November the grass cattle are sold; that is, in the older parts of this country.


John Gordon Ross: And in the west in September, October and November,


William Earl Rowe: In October, November and December in western Canada, as the hon. member for Moose Jaw says. I think we need some control in order to provide an orderly supply for this market, instead of leaving the orderly marketing to be controlled by the United States.


William Hayhurst: A short time ago I asked if the number would be the same for each quarter, and now the minister says it is not cumulative. To me this means that in the last quarter we would not be able to fill the entire quota for the year.


William Daum Euler: No, you could not do that; but if, for example you sent 60,000-


John Gordon Ross: Is it 60,000 or 51,000?


William Daum Euler: The global quota is 60,000; but supposing the 60,000 is shipped in each of the first three quarters, that makes 180,000. The total for the year is 225,000, which would mean only 45,000 could be shipped in the last quarter. If you were short in some of the other quarters at least you would be allowed to make up 15,000 of that shortage in the last quarter, which otherwise you would not be able to do. That is, you could send
60.000	in the last quarter, and in that way you could ship 15,000 more because you were short in some of the other quarters, without exceeding the limit of 60,000 for that quarter.


William Earl Rowe: You might only ship 10,000 in some quarters.


William Daum Euler: You could make up 15,000 in the last quarter, at least. If you shipped
60.000	in each of the first three quarters you would have only 45,000 left for the last quarter, so you could make up your previous shortage at least to that extent.


Harry Leader: I think what the minister has just said has made the matter clear We are entitled to 86-2 per cent of 225,000 and if we are a little short in one quarter we can make it up in the next or, in any event, in the last quarter.


William Daum Euler: To the extent of 15,000.


Harry Leader: Then, if we cannot take advantage of that 86-2 per cent, even if we have the cattle available in the last quarter, I think something slipped, and I believe another trip to Washington might straighten it out.


John Gordon Ross: The hon. member says something slipped, but as far as I can see the only slip has been that we are going to get many more cattle into the United States market. My hon. friend mentioned shipping only 45,000 cattle-


William Earl Rowe: We might only ship 10,000.


John Gordon Ross: Then that would be all the cattle available for shipment at that time. If you only shipped 40,000 in each quarter you still would have a great advantage compared with what you had before. Formerly the total global quota was only 155,000, and if Canada can ship in 160,000 cattle now in the four quarters we shall be that much better off in any event. As a matter of fact, I do not think we are going to fill our quota this year. I do not think the fact that the quota for the first quarter was filled
2212	COMMONS
Canada-United States Trade Agreement
in the first month should worry us too much, *because while we shipped 32,000 head during the first month, other countries shipped something like 27,000, and they cannot ship that many in the months to come. They can ship only thirteen per cent of the 60,000 head, and we have the balance of 51,000 if we want it. Therefore we have a tremendous advantage no matter how one looks at the matter.


Mr. THOMPSON:: The matter seems quite clear to me. We were given a quota of
225,000	head for Canada and Mexico, but not more than 60,000 head in any three month period. We have the right to ship 86-2 per cent of 60,000 head in the three month period; then we are through until the next three months, and each three month period stands by itself. The matter is perfectly clear.


Harry Leader: If you are short, are you not allowed to ship in the difference?


William Daum Euler: No.


Harry Leader: I think so.


Harry James Barber: The treaty says that the rate under the new agreement is to apply annually to not more than 225,000 head, and to not more than 60,000 head in any quarter. There is no mention in the treaty about 86 per cent. Would the minister explain when and how this was arrived at?


William Daum Euler: I will read the clause in the trade agreement which explains how it was we were able to get a fixed quota:
That if, after consultation with the government of the United States of America, the government of Canada requests the allocation of the quantity entitled to enter at the reduced rate of duty under this item, the government of the United States of America shall take the necessary steps to allocate the said quantity among countries of export on the basis provided for in article III of this agreement.
That is what was done. On the basis of article III of the agreement they took the years 1936 and 1937 as being normal years of export, and took that as the basis for fixing the quota which Canada could have out of the 60,000, each quarter. That worked out to 86 per cent.


Harry James Barber: When was the United States approached in this matter?


William Daum Euler: Some time in February. The matter came up in the house, and at the time it came up


Harry James Barber: Since the treaty came down?


William Daum Euler: Yes. When attention was
drawn to the fact that Mexico had sent in a large number of cattle, I said at the time 
that we hoped to make some satisfactory disposition of the matter. Then representatives of the government went to Washington. They were assured the president would issue a statement as to what our quota should be. He did that, and fixed it at 86 per cent.


Karl Kenneth Homuth: I want to get the explanation clear, because I think some of us have some misunderstanding. Suppose we ship
30,000	head in the next quarter; in the third quarter we ship 30,000 head. That would leave us 42,000 we have not shipped, because out of the 60,000 our quota is 51,000. In the last quarter we could ship only 86 per cent of 60,000.


William Daum Euler: Right.


Karl Kenneth Homuth: Ordinarily it would be
about 86 per cent of 45,000. We could increase that by 86 per cent of 15,000. Therefore, so far as our gross quota is concerned, we would still have a shortage of 27,000?


William Daum Euler: Provided you were short on
each of those quarters to the extent you indicated.


Karl Kenneth Homuth: So, unless we are able
to fill the quota each quarter, we have not a cumulative yearly quota?


William Daum Euler: That is quite correct.


Mr. WARREN:: I am sorry I missed the
discussion on this item, because I had taken some interest in it, and had prepared some figures in connection with it. My interest was more particularly aroused after listening to the speech some time ago of the hon. member for Lanark (Mr. Thompson). I do not know just what we are going to gain, or what the people of Canada are going to gain by belittling an agreement which certainly is to the advantage of the Canadian farmer. I notice that in his observations on February 21, the hon. member for Lanark is reported to have said, as it appears at page 1199 of Hansard:
Every trade treaty this government has made with the United States has been detrimental to the interests of Canada.
Knowing the hon. member's riding to some extent-because I happen to have relatives living in Lanark county-I wondered just what the farmers of Lanark were going to gain by having this trade treaty misrepresented to them, so far as the sale of their cattle was concerned. It is foolish to imply that we would want to export all our cattle. All we want to export is our surplus; if we can get rid of that we shall be well satisfied.
In the dairy sections of Lanark county one thing the farmers are particularly interested

Canada-United States Trade Agreement
in is the sale of veal calves. I am worrying more about the farmers in Lanark than those in Renfrew, because I have not heard any complaints from the farmers of Renfrew county respecting this treaty.


Thomas Alfred Thompson: You mind your own
county; I will look after mine.


Ralph Melville Warren: I am not worrying about
my farmers, because so far as this treaty is concerned they have no complaint to make. I was however, rather worried about the effect the hon. member's speech might have on my relatives in his county, so I took the trouble to look up the figures. I knew those people would be interested in the price of veal calves.
We do not want to export all our veal calves; but at certain seasons of the year, particularly the early spring, we have a considerable surplus. In the county of Lanark a great many farmers do not think they are farming at all unless they are milking twenty, thirty or forty cows. They may raise ten calves, which leaves them thirty calves to sell as veal. Let us look at some of the figures. I have before me the figures from 1933 to 1938, and I shall begin at the earlier year. We will remember that 1933 was a bad time; if I remember correctly, a Conservative government was in office. The following table will show the figures for exports of calves to all countries, and to the United States:
Calendar	All	Unitedyear	countries	States1933	
976	481934	
1,302	2261935	
21,587	20,5671936	
51,783	50,5411937	
99,648	98,4261938	
49,417	48,347
It will be remembered the Liberals took office in 1935. If we take the years 1933 and 1934, the last two years the Conservative party was in office, we find that only 274 veal calves were exported to the United States, whereas if we take the years 1937 and 1938. the last two calendar years in which this government has held office, we find that 146,535 calves were exported from the surplus we did not need.
Let us look at the prices. Naturally, we have to pay duty on those export calves; I believe the rate is 1J cents a pound. If we have a surplus on our Montreal or Toronto markets our prices go below value, and particularly in the spring of the year when the dairy farmer in counties such as Lanark has a surplus of calves on his hands. That would apply particularly in the months of April and May.
Let us look at the figures for the Toronto market. The following table will show the prices per hundredweight of veal calves on that market in the months of April and May:
Year	April	May1934	.. .. $6 92	$6 331935	.. .. 7 29	6 691936	. . .. 8 68	8 201937	.. .. 9 19	8 371938	.. .. 9 15	8 20Those, of course,	are prices	for choiceveal calves. That may not seem a	very greatvariation, but let us	compare 1934	with 1938,which is I think a	fair comparison, and we	
find in those same two months a gain for the month of April of S1.87 per hundred pounds on a two hundred pound calf. That will mean an additional revenue to the farmer of $44.80 on ten calves in April, and $37.40 on ten calves in May, or an additional revenue in the two months of $82 foi the twenty calves, and many farmers would have more than twenty calves. Now, $82 may not seem like a great deal of money to some people, but it is a considerable cheque to a farmer. The farmer who can get an extra $82 for his veal calves is getting something that he is going to appreciate.
Let us take cattle. I notice that the hon. member for Lanark always talks about a thousand pound steer when he is making camparisons in connection with this treaty, but we ought to bear in mind that under the treaty we have been able to export and get off- our markets by shipping them to the United States, a class of cattle that has had a detrimental effect on our domestic market-our canner cows, for example, and a great many of our inferior quality of cattle.
In 1933, under the government which the hon. member for Lanark supported, we shipped to all countries 59,158 head of cattle; to the United Kingdom, 50,317; to the United States, 5,686. The figures for the other years are as follows:
Export of Cattle (excluding calves) Number of Head
Calendar	All	United	Unitedyear	countries	Kingdom	States1933	59,158	50,317	5,6861934	63,673	53,852	6,3411935	112,771	6,704	102,9341936	233,631	38,495	191,1491937	222,112	9,610	208,5521938.. .. [DOT][DOT]	129,807	27,307	98,398
Someone might ask why there was such a falling off in our exports to the United Kingdom in 1937 and such a great increase in our exports to the United States. That is easily explained. Prices were so much better
-2214	COMMONS
Canada-United, States Trade Agreement
in the United States that it paid the Canadian farmer to ship his cattle there rather than to the United Kingdom.
During 1933 and 1934, the years in which the hon. member for Lanark was supporting the former government, we shipped a total of 12,027 head of cattle to the United States. Compare that with the two years 1937 and 1938, when we shipped a total of 306,950 head of cattle to the United States. Surely that ought to be an answer to the hon. member's statement that every trade treaty made by this government with the United States has been detrimental to Canada.


William Earl Rowe: Give us the figures for 1930. That was ten years after the hon. member's party was in power.


Ralph Melville Warren: I have not the figures for 1930, but I think it is fair to compare 1934 and 1935, with 1937 and 1938.
There is another feature in connection with the treaty which I wish to mention. We in Renfrew county-and I assume this is true also of the farmers of Lanark county-have found it beneficial to ship our dairy cows to the United States. The local market for dairy cows, generally speaking, is limited. The market in Montreal and Toronto is comparatively small and prices there are generally not profitable. But we have had United States buyers going through our counties in past years picking up our dairy cows, pure bred and grade stock, testing them and shipping them to the United States. That leaves the farmer in this position. The farmer who is separating his milk and sending his milk to a butter factory can find a profitable market for any cows that he cares to raise, and a farmer who has his skim milk at home will raise all his heifer calves if he knows he is going to be able to sell his surplus cows. So here we have abundant proof that our agreement with the United States has been profitable to the dairy farmer in selling his veal calves, in selling his cattle, and in selling his dairy cows.
If any further proof were needed, my mind goes back to the dreary days in 1932 and 1933, under the former government, when we could not get more than three cents a pound at certain times of the year, in the fall, for example, on the Toronto and Montreal market. You had to beg the buyers to take splendid stock, good steers, at three cents a pound, and sometimes fairly good beef went for a cent and a half or a cent and a quarter a pound.


William Earl Rowe: What was the United States market paying at that time? That is when they were killing off six million head.


John Ritchie MacNicol: And throwing them in the river.


William Earl Rowe: And that is the market the hon. member for Renfrew North says is a good market!


Ralph Melville Warren: It has proved itself good to us since this government came into office, because the United States has been taking our surplus stock up to the figures I have put on record. But it gives me a chill to think of the markets we had in those terrible years 1932 and 1933. Under this treaty you can now get $6.60 per 100 pounds for a decent steer, from seven to seven and a half and eight cents a pound if it is a good one, compared with three and three and a half cents down to a cent and a quarter and a cent and a half a pound in 1932 and 1933. Those were the black days. Although we managed to get through somehow, those were days which left many of our farmers in a situation from which they never recovered. Certainly I should hate to think that my relatives in Lanark county would be worried respecting this trade agreement, which certainly will prove, and undoubtedly up to date has proven of immense value to them as farmers.


Thomas Alfred Thompson: Every time that the hon. member for Renfrew North rises in his place in this chamber he takes a whack at me. I do not blame him a bit, because I spent two weeks in Renfrew North trying to lick him, and if it had not been that the election was on the fifth of April, that the roads were impassable, and the day was one of the worst that ever came, he would not be sitting in this house. I do not intend to follow his argument, because I never heard so much nonsense talked in as short a space of time. He has told us about calves and dairy cows. Mr. Chairman, you know that the tariff respecting them has not been changed; it is the same as it was since 1935, and we never filled our quota. As we have not filled our quota with calves, enlarging the quota cannot mean anything to our farmers; there was no advantage to them in having it raised, and no change has occurred under it. In the hon. member's address he talked of the days of the depression-


Robert James Manion: The world depression.


Thomas Alfred Thompson: -and did not give the figure of 1930-it was less than any of them. As I say, however, it is not my intention to follow my good friend. I hope that when the election comes on, I shall be able to get another crack at him, and that he will not be here afterwards.

Canada-United, States Trade Agreement


James Alexander Marshall: I am sorry that the
government cannot give much consideration to the question of cattle which are en route to the United States market after the quota has been closed. I should like to read into the record a couple of paragraphs from a letter which I received this morning from the manager of a live stock marketing association in Alberta:
Dear Sir:
Regarding shipments of cattle to the United States of America during the first quarterly quota, when as you know that nearly half of that quota was filled 'by Mexican cattle, thus working a hardship on the shipper from Canada, also very costly on the shipper who had his cattle en route when this quota was filled as there was no warning-just filled.


Malcolm McLean: I should like to ask the hon. member who is addressing the committee if there were not a warning given by the United States government when ten per cent of the quota was still remaining.


James Alexander Marshall: I am just reading an extract from the letter. I have not made any comment at all on the matter.


Mr. CRERAR:: Well, he did not know what he was writing about.


James Alexander Marshall: Don't you think some adjustment should be made to the shipper that had his cattle en route when this quota was filled in this way? It has meant between $350 to $400 a car through absolutely no fault of ours. In my case it amounts to $361. Why should we have to lose this through not proper protection of our share of the quota? In this we can hardly take this loss.
All I wish -to say in this connection is that I believe the hon. member for Portage la Prairie has made many valuable suggestions to the minister, and I should like to add my voice to his in suggesting to the minister that the three month period be narrowed down to perhaps either two months or one month.


Major James William Coldwell: Upon what date was
the notice given that ten per cent still remained, and upon what date did the quota end?


William Daum Euler: The quota ended early in February-February 2, I think.


Major James William Coldwell: On what date was the notice given that ten per cent remained?


William Daum Euler: I cannot tell the hon. member that. I do not know. I might make this observation, that the difficulty which arose in the first quarter was rather because of an abnormal condition. It was not anticipated that Mexico would send such a large quantity of cattle into the United States in that quarter, 71492-140
and it was for that reason that the surplus of cattle en route to the United States was so large. In order to provide against that in the future-and I think perhaps it will be provided against in this way-we are receiving early in the quarter, I believe about every four weeks, notice from the United States government as to how many cattle have been admitted; then later on, when we get nearer to the end of the quarter and the quota is nearer to the point of exhaustion, we receive notice by telegram, and that is communicated to the stock-yards and to the Commercial Intelligence Journal and by other means to the exporters in Canada so that they can govern themselves accordingly.


Major James William Coldwell: Is it not a fact that the trouble really arose because notification that only ten per cent remained of the quota was given just a few days before the quota was filled? I have had letters similar to the one which has just been read.


William Daum Euler: I think the real reason was the unexpected supply from Mexico.


[Stage Direction]
Item agreed to.
United States tariff-701. Cattle, weighing seven hundred pounds or more each: Cows, imported specially for dairy purposes: li cents per pound. Other, 1J cents per pound.
Provided, that after December 31, 1938, such cattle weighing seven hundred pounds or more each (other than cows imported specially for dairy purposes) entered, or withdrawn from warehouse, for consumption in excess of 60,000 head in any quarter year shall not be entitled to a reduction in duty by virtue of this item, and such cattle (other than cows imported specially for dairy purposes) entered, or withdrawn from warehouse, for consumption in excess of 225,000 head in any calendar year shall not be entitled to a reduction in duty by virtue of this item, but the rate of duty thereon shall not exceed 3 cents per pound.
Provided further, that if, after consultation with the government of the United States of America, the government of Canada requests the allocation of the quantity entitled to enter at the reduced rate of duty under this item, the government of the United States of America shall take the necessary steps to allocate the said quantity among countries of export on the basis provided for in article III of this agreement.
Item agreed to.
United States tariff-703. Swine: 1 cent per pound.
United States tariff

703. Pork, fresh or chilled, but not frozen: 11 cents per pound.
United States tariff-703. Bacon, hams, and shoulders, and other pork, prepared or preserved, but not cooked, boned, packed in airtight -containers, or made into sausages of any kind; 2 cents per pound.
William Hayhurst: Does this item of reduction on swine from two cents to one cent per pound apply to swine of all weights?

2216	COMMONS
Canada-United, States Trade Agreement


William Daum Euler: Yes.


William Earl Rowe: Could the minister tell us the exports last year to the United States?


William Daum Euler: In 1937, according to United States records, the value of our awine exports was $1,525,208. It is on the ta' Jar statement.


William Earl Rowe: Has the minister any figures to give us of the exports by the United States of swine, pork and pork products to the United Kingdom market before ;he 1932 imperial trade agreement?


William Daum Euler: By the United States?


William Earl Rowe: Yes. Their exports to the United Kingdom before the trade agreement?


William Daum Euler: No. I regret I have not that information.


William Earl Rowe: While we have a reduction in duty in these items, it will be recognized that it is not nearly as important to the Canadian swine producer as the advantages the United States producer receives in the imperial market under the Anglo-American treaty. I believe that before 1932 the United States exported to the British market a great deal more bacon than Canada did, and that their exports dropped off after that time. We had a market in the old land of only small proportions prior to the imperial trade agreement. In 1931 it was about 49,000 hundredweight. By 1937 it had reached
1,387,000	hundredweight, or over a million and a quarter.
As regards our advantages in the United States market for bacon products, they are not to be compared with the advantages that we have surrendered in the British market to the United States producer. Personally I think the market in the United States for our meats has been of uncertain value for many years. The preference that is extended to the United States producer in this line is similar to the preference extended in many other directions. It will not only give the United States producer a place in the greatest market of the world but surrender again stability in markets that we have been long endeavouring to establish.
We have had a haphazard market in the United States, a very uncertain market. Comparisons have been made, one year with another, but I think it is unfair to suggest the year 1932 for comparative purposes, because everyone knows that the United States was at that time destroying almost every line of live stock. Millions of hogs, millions of [Mr. Hayhurst.J
cattle, were destroyed; farm products were being destroyed all along the line down to the cotton fields of the south.


Thomas Alexander Crerar: Not hogs in 1932.


William Earl Rowe: There was an over-supply. Our exports of live stock to the United States were insignificant even in 1930. We imported four or five million pounds of meat into this country in 1930 to feed our own people. Our exports of live stock had practically disappeared. Take the year 1921, if you want to compare different years-and I am not charging this to the government that is in power to-day, because it was the trend of development. We shipped more live stock to the markets of the world in 1921 than we have done since. Our export market for bacon had practically disappeared between 1921 and 1930, Denmark having captured that market from us in the old land. In 1921 we sold twice as many cattle to the United States as the whole global quota includes now-in cattle and calves, upwards of half a million. But the Fordney-McCumber tariff closed us out over-night and we were left for years not knowing what to do with our surplus live stock. In 1929 we had recovered the market to some extent, but the Hawley-Smoot tariff closed us out again. Now we have a temporary advantage in that uncertain market for some of these products, but we have cut the tariff in this item from two cents to one cent-


William Daum Euler: They have.


William Earl Rowe: They have, rather. Someone on the other side said that this would figure out at a fifty per cent reduction, and that is true; fifty per cent of a two cent tariff is one cent. But when one realizes that they send only $1,500,000 worth, one realizes how' insignificant it is. And in order to achieve this great purpose of getting into the United States market for $1,500,000 worth of swine, with other minor advantages, we are extending to the United States, through the Anglo-American treaty, the preference in the old land.


William Daum Euler: I wish to correct one impression left by the hon. member with regard to the preference which he says we have given up in the United Kingdom market in bacon and hams. We have given up nothing whatever. Our quota remains exactly what it was. The only thing is that the quota for the United States has 'been increased from 400,000 hundredweight to 500,000 hundredweight. That is not at the expense of the Canadian producer but of other countries that are exporting to Great

Canada-United States Trade Agreement
Britain, and no advantage whatever is yielded by the Canadian government in the British market. Moreover, there was no binding with regard to Canada other than the quota. The United Kingdom was at perfect liberty to make any concessions she desired to the United States, but I repeat that we have given up nothing in regard to bacon and hams. The quota is the same as it was, and any increase in quota granted the United States by the United Kingdom is at the expense of other countries and not of Canada.


[Stage Direction]
Items agreed to.
United States tariff-706.	Edible animal
livers, kidneys, tongues, hearts, sweetbreads, tripe, and brains, fresh, chilled or frozen: 3 cents per pound, but not less than 15 per cent ad valorem.
Item agreed to.
United States tariff-707. Whole milk, fresh or sour, 31 cents per gallon.
Provided, that such fresh or sour milk entered for consumption in any calendar year after 1938 in excess of 3,000,000 gallons shall not be entitled to a reduction in duty by virtue of this item, but the rate of duty thereon shall not exceed: 6J cents per gallon.
Item agreed to.
United States tariff-707. Cream, fresh or sour: 28% o cents per gallon.
Provided, that such fresh or sour cream entered for consumption in any calendar year after 1938 in excess of 1,500,000 gallons shall not be entitled to a reduction in duty by virtue of this item, but the rate of duty thereon shall not exceed 56*Ho cents per gallon.
George Halsey Perley: It seems to me that the government have not done the best that was possible in connection with milk and cream. The reduction is only 6i cents a gallon. There is an ad valorem duty of nineteen per cent. I do not think that is quite good enough. After listening to the debate that took place yesterday with regard to the effect upon the dairy industry in Canada of imports of vegetable oils, I submit that the government should have made every effort to secure a greater concession in respect to cream and milk. Consider the surplus butter we have in Canada. The government might have made an effort to secure a greater reduction and to have the quota increased. The quota on cream is 1,500,000 gallons. If that could have been doubled at a lower rate, it would have assisted materially. I repeat, the government should have made a greater effort.


William Daum Euler: It was not possible to get a lower rate. We received the maximum reduction of fifty per cent. It was not possible under the powers of the president.


George Halsey Perley: You did not get a fifty per cent reduction on cream.


William Daum Euler: Yes.


George Halsey Perley: It is from 35 cents to 28A cents.


William Daum Euler: Yes, but we had a reduction in the previous agreement. It is a reduction of fifty per cent from the tariff rate.


William Earl Rowe: From the tariff act of 1930.


William Daum Euler: Yes, and that was the full reduction that was possible.


Hugh Alexander Stewart: With respect to the export of cream and milk, is it not a fact that it is subject to municipal and state regulations as to production in Canada under conditions that conform with their requirements? As a matter of fact, I am informed by those who know very well that it is practically impossible to comply with the regulations, so far as the average producer is concerned, because the product must be pasteurized in one state, or there are some other regulations as to production which make it difficult for the Canadian producer to comply with the requirements. It is only one in a hundred who can do it. Is that not the reason why we have not caught up to our quota?


William Daum Euler: Probably it is. There is no question that the United States health regulations are very strict indeed. But it hardly enters into the scope of making a trade agreement to ask the United States to change their health regulations which are imposed for the purpose of preserving the health of their people.


Hugh Alexander Stewart: I am asking if that is not the reason why we have not reached anything like our quota and cannot possibly reach it under this or any other agreement.


William Daum Euler: That may be true.


William Hayhurst: Under the new agreement 1,500,000 gallons of cream may be shipped annually at 28^ cents per gallon. How many gallons were shipped under the 1935 agreement at 35 cents a gallon?


William Daum Euler: In 1935, 480 gallons; in 1936, 44,053 gallons; in 1937, 136,034 gallons.


William Hayhurst: What was the amount that could have been shipped?


William Daum Euler: A million and a half gallons.


William Earl Rowe: What percentage is that of the United States consumption?
2218	COMMONS
Canada-United States Trade Agreement


William Daum Euler: I do not know, but I think it is very small.


Henry Herbert Stevens: The decimal would be too long.


William Earl Rowe: Practically any county between Ottawa and Toronto could produce more than the total quota secured.	*


William Daum Euler: I quite admit that this is not the most important concession we received. The others that we received are so great that this may appear infinitesimal, but that is no reason for refusing it.


Malcolm McLean: The 18,000,000 gallons of milk or its equivalent in cream that would be taken off the market here would just about account for the surplus of butter that is troubling us. If that amount of butter were gone the market would be buoyant as it was at this time last year.


Thomas Alfred Thompson: Enlarging the quota is of no benefit to Canada, because the duty remains the same and the quota last year was not filled.


Malcolm McLean: The statistics of two or three weeks ago indicated that there were only five or six million pounds more butter than last year in storage. That is, there were ten million, but there was an evident shortage of five million pounds last year which had to be obtained from some other source, so that there was a net surplus this year of about five million pounds.


William Earl Rowe: It would still have to be good milk.


Thomas Alfred Thompson: We sent last year only about 5,000 gallons of milk; we practically are not shipping any milk to the United States.


Hugh Alexander Stewart: We cannot get it in there.


Thomas Alfred Thompson: This 6i cents a gallon on fresh milk-


Malcolm McLean: It is 3j- cents a gallon.


Mr. IHOMPSON:: It was 61 cents, now down to 3} cents. Milk will not be shipped in under that,


Malcolm McLean: Well, there is
an opportunity ahyhow.


William Allen Walsh: Have any arrangements
been made for the inspection of farms and dairies which might be interested in shipping milk or cream to the United States, so that they could meet the regulations there?


William Daum Euler: I am informed that this
is being done all the time, but for more defi-
nite information I am afraid I have to refer my hon. friend to my colleague the Minister of Agriculture.


Hugh Alexander Stewart: He would .not tell you.


[Stage Direction]
Item agreed to.
United States tariff-707. Skimmed milk, fresh or sour, and buttermilk: 2Vfco cents per gallon.
Item agreed to.
United States tariff-708 (b). Dried buttermilk: 12 cents per pound.
Item agreed to.
United States tariff-7X0. Cheddar cheese, whether or not in original loaves, but not including any cheese processed otherwise than by division into pieces: 4 cents per pound, but not less than 25 per cent ad valorem.
Item agreed to.
United States tariff-711.	Birds, live;
chickens, ducks, geese, turkeys and guineas: 4 cents per pound.
Item agreed to.
United States tariff-712.	Birds, dead,
dressed or undressed, fresh, chilled, or frozen; chickens, ducks, geese, and guineas: 6 cents per pound.
Item agreed to.
. United States tariff-713. Eggs of chickens, in the shell: 5 cents per dozen.
Item agreed to.
United States tariff-714.	Horses, unless
imported for immediate slaughter:
Valued at not more than $150 per head: $15 per head.
Valued at more than $150 per head: 17J per cent ad valorem.
Item agreed to.
United States tariff-716. Honey: H cents per pound.
Item agreed to.
United States tariff-717(a). Fish, fresh or frozen (whether or not packed in ice), whole, or beheaded or eviscerated or both, but not further advanced (except that the fins may be removed):
Halibut, salmon, and swordfish (not including naturally or artificially frozen swordfish:
1 cent per pound.
Mackerel: Fresh, 1 cent per pound; frozen, li cents per pound.
Chubs, fresh-water mullet (catostomus), jacks, lake trout, saugers, tullibees, whitefish, yellow pike, blue pike, ciscoes, lake herring, and yellow perch: f cent per pound.
Shad, eels, and sturgeon (not including frozen sturgeon): 1 cent per pound.
Cod, haddock, hake, pollock, and eusk: Without fins removed, i cent per pound; with fins removed: 1 cent per pound.
Item agreed to.

Canada-United States Trade Agreement
United States tariff-717(b). Fish, fresh or frozen (whether or not packed in ice), filleted, skinned, boned, sliced, or divided into portions, not specially provided for: cod, haddock, hake, pollock, cusk, and rosefish: 1J cents per pound.
Provided, that such fish entered, or withdrawn from warehouse, for consumption in any calendar year after 1938 in exeess of an aggregate quantity of 15,000,000 pounds shall not be entitled to a reduction in duty by virtue of this item;
Provided further, that if the average apparent annual consumption of such fish in the United States during the three calendar years preceding the year in which such fish are entered, or withdrawn from warehouse, for consumption, exceeds 100,000,000 pounds, an additional quantity of such fish equal to the amount by which 15 per centum of such average apparent annual consumption exceeds 15,000,000 pounds may be entered, or withdrawn from warehouse, for consumption in that year at the reduced rate above specified. Such average apparent annual consumption shall be taken as the sum of the following:
(a) The production in the United States of cod, haddock, hake, pollock, cusk, and rosefish fillets, steaks, and sticks, whether fresh or frozen, as now defined, and as reported, by the United States bureau of fisheries (for the purposes of this agreement such production for the calendar year 1936 shall be considered as
94.908.000	pounds, and for the calendar year
1937,	as 92,332,000 pounds);
0b) The quantity of cod, haddock, hake, pollock, cusk, and rosefish fillets, steaks and sticks, whether fresh or frozen, entered into the customs territory of the United States free of duty under paragraph 1730(a) of the Tariff Act of 1930 as products of American fisheries (for the purposes of this agreement such quantity for the calendar year 1936 shall be considered as
40.000	pounds, and for the calendar year 1937, as 585,000 pounds); and
(c) The aggregate quantity entered, or withdrawn from warehouse, for consumption of cod, haddock, hake, pollock, cusk, and rosefish, fresh or frozen (whether or not packed in ice), filleted, skinned, boned, sliced, or divided into portions, not specially provided for (for the purposes of this agreement such quantity for the calendar year 1936 shall be considered as
6.296.000	pounds, for the calendar year 1937, as 6,719,000 pounds, and for the calendar year
1938,	as 6,100,000 pounds);
Provided further, that if, after consultation with the government of the United States of America, the government of Canada requests the allocation of the quantity entitled to enter at the reduced rate of duty under this item, the government of the United States of America shall take the necessary steps to allocate the said quantity among countries of export on the basis provided for in article III of this agreement.
Item agreed to.
United States tariff-717 (b). Fish, fresh or frozen (whether or not packed in ice), filleted, skinned, boned, sliced, or divided into portions, not specially provided for (except cod, haddock, hake, pollock, cusk, and rosefish);	21 cents
per pound.
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 airtight containers weighing with their contents not more than 15 pounds each):
(1)	Salmon: 12J per cent ad valorem.
(2)	Cod, haddock, hake, pollock, and cusk, neither skinned nor boned (except that the vertebral column may be removed):
When containing not more than 43 per
centum of moisture by weight: f cent per ' pound.
When containing more than 43 per centum
of moisture by weight: f cent per pound.
(3)	Cod, haddock, hake, pollock, and cusk, skinned or boned, whether or not dried: 1J cents per pound.
(4)	Herring, beheaded and eviscerated, but not further advanced (except that the fins may be removed), and herring known commercially as split herring, any of the foregoing, in bulk or in immediate containers weighing with their contents more than 15 pounds each and containing each more than 10 pounds of herring, net weight: f cent per pound net weight.
(4)	Mackerel, whether or not boned, in bulk or in immediate containers weighing with their contents more than 15 pounds each: 1 cent per pound net weight.
(5)	Alewives in bulk or in immediate containers weighing with their contents more than 15 pounds each: f cent per pound net weight.
Item agreed to.
United States tariff-720 (a). Fish, smoked or kippered (except fish packed in oil or in oil and other substances and except fish packed in airtight containers weighing with their contents not more than 15 pounds each):
(1)	Salmon: 15 per cent ad valorem.
(2)	Hard dry-smoked herring, when whole or beheaded but not further advanced: f cent per pound.
(3)	Smoked herring, boned, whether or not skinned: li cents per pound.
(4)	Cod, haddock, hake, pollock, and cusk, whole, or beheaded or eviscerated or both, but not further advanced (except that the vertebral column may be removed): 1J cents per pound.
(5)	Cod, haddock, hake, pollock, and cusk, filleted, skinned, boned, sliced, or divided into portions: 2 cents per pound.
Item agreed to.
United States tariff-720(b). Cod, haddock, hake, pollock, and cusk, prepared or preserved, not specially provided for, in immediate containers weighing with their contents not more than 15 pounds each: 21 cents per pound, but not less than 12J nor more than 25 per cent ad valorem.
Item agreed to.
United States tariff-721(b). Razor clams (siliqua patula), packed in airtight containers: 15 per cent ad valorem.
Item agreed to.
2220	COMMONS
Canada-United, States Trade Agreement
United States tariff-722. Barley, hulled or unhulled: 15 cents per bushel of 48 pounds.
Item agreed to.
United States tariff-722. Barley malt: 40 cents per 100 pounds.
Item agreed to.
United States tariff-723. Buckwheat, hulled or unhulled: 15 cents per 100 pounds.
Item agreed to.
United States tariff-1723. Buckwheat flour and grits or groats: 9io cent per pound.
Item agreed to.
United States tariff-726. Oats, hulled or unhulled: 8 cents per bushel of 32 pounds.
Item agreed to.
United States tariff-726. Unhulled ground oats: 25 cents per 100 pounds.
Item agreed to.
United States tariff-726. Oatmeal, rolled oats, oat grits, and similar oat products: 10 per cent ad valorem, but not less than 40 nor more than 80 cents per 100 pounds.
Item agreed to.
United States tariff-728. Rye: 12 cents per bushel of 56 pounds.
Item agreed to.
United States tariff-728. Rye malt:	35
cents per 100 pounds.
Item agreed to.
United States tariff-729. Wheat, unfit for human consumption: 5 per cent ad valorem.
George Halsey Perley: Was any effort made to get a lower duty on wheat, not wheat unfit for human consumption, but straight wheat?


William Daum Euler: Yes, great efforts were made, but I am sorry to say without success.


John Ritchie MacNicol: They would not give us anything if they could get out of it.


[Stage Direction]
Item agreed to.
United States tariff-730. Bran, shorts, byproduct feeds obtained in milling wheat or other cereals: 5 per cent ad valorem.
Item agreed to.
United States tariff-730. Hulls of oats, barley, buckwheat, or other grains, ground or unground: 5 cents per 100 pounds.
Item agreed to.
United States tariff-730. Dried beet pulp: $3.75 per ton.
Item agreed to.

United States tariff-730. Malt sprouts and brewers' grains: $2.50 per ton.
Item agreed to.
United States tariff-730. Mixed feeds, consisting of an admixture of grains or grain products with oil cake, oil cake meal, molasses, or other feedstuffs: 5 per cent ad valorem.
Item agreed to.
United States tariff-731. Screenings, scalp-ings, chaff, or scourings of wheat, flaxseed, or other grains or seeds: unground, or ground: 5 per cent ad valorem.
Item 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: 10 per cent ad valorem.
Mr. CLARKE (Rosedale):: Does that
mean that there is a good deal of labour in the processing of these cereal breakfast foods?


William Daum Euler: This covers all cereal breakfast foods. They would be processed. It does not cover the good old Scotch dish, oatmeal.


Harry Gladstone Clarke: How much labour would there be in processing these cereals?


William Daum Euler: I am afraid I cannot tell that.


[Stage Direction]
Item agreed to.
United States tariff-734. Apples, green or ripe: 15 cents per bushel of 50 pounds.
William Allen Walsh: Is there any kind of connection between this item as it pertains to the Canada-United States treaty and to the United States-United Kingdom treaty?


William Daum Euler: This is the same as we
had in the old agreement; there is no change.


William Allen Walsh: There is nothing in this item that is related in any way to the reduction as between the United States and the United Kingdom that will interfere with our apple growers?


William Daum Euler: No, I would say not.


[Stage Direction]
Item agreed to.
United States tariff

736. Berries, edible, in their natural condition or in brine, not specially provided for:
Blueberries: 1 cent per pound.
Other (except lingon or partridge berries): | cent per pound.
Item agreed to.

Canada-United, States Trade Agreement
United States tariff-736. Blr sherries, prepared or preserved, or frozen, b' c not in brine and not dried, desiccated, or t /aporated, and not specially provided for: 17J per cent ad valorem.
Item agreed to.
United States tariff-736. Berries, edible, frozen, and not specially provided for: 17i per cent ad valorem.
Item agreed to.
United States tariff-737. Cherries: (1) in their natural state, not in airtight or watertight containers: 1 cent per pound.
Item agreed to.
United States tariff-738. Cider: 3 cents per gallon.
Mr. MASSEY:: What is cider?


William Daum Euler: As far as I know, it is the juice of the apple; that is the best definition I can give.


Hugh Alexander Stewart: Drink it and see what it will do.


[Stage Direction]
Item agreed to.
United States tariff-753. Cut flowers, fresh, dried, prepared or preserved: 25 per cent ad valorem.
John Ritchie MacNicol: In the absence of the hon. member for Peel (Mr. Graydon), I might say that he would like to have seen this item reduced the full amount that the President of the United States could have given, namely, to 20 per cent.


William Daum Euler: We obtained quite a substantial reduction, from 40 per cent to 25 per cent.


John Ritchie MacNicol: I am sure if the hon.
member for Peel had been here he would have asked that the duty be reduced to 20 per cent.


[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.
Red clover: 4 cents per pound.
Sweet clover: 2 cents per pound.
Timothy: 1 cent per pound.
Bent-grass (genus agrostis):	20 cents per
pound.
Bluegrass: 2J cents per pound.
Wheatgrass: 1 cent per pound.
Bromegrass: 1 cent per pound.
Item agreed to.
United States tariff-764. Tree and shrub seeds: 4 cents per pound.
Item agreed to.
United States tariff-766. Beets, other than sugar beets: 10 per cent ad valorem.
Item agreed to.
United States tariff-769. Peas, green or unripe, when imported and entered fdr consumption during the period from July 1 to September 30, inclusive, in any year: 2 cents per pound.
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 March 1 to November 30, inclusive, in any year: 371 cents per 100 pounds.
From December 1 in any year to the last day of the following February, inclusive:' 60 cents per 100 pounds.
Provided, that if and when the United States is no longer obligated to accord to such potatoes produced in the Republic of Cuba a preferential reduction in the rate of duty in excess of 20 per centum, the rate of duty under this item during the entire year shall be 371 cents per 100 pounds.
Provided further, that such potatoes entered for consumption in the 12-month period beginning on September 15 in the year 1938 or any subsequent year in excess of an aggregate quantity of 1,500,000 bushels of 60 pounds each shall not be entitled to a reduction in duty by virtue of this item, but the rate of duty thereon shall not exceed 75 cents per 100 pounds.
United States tariff-771. White or Irish potatoes, other than certified seed potatoes, as defined in the preceding item, when entered for consumption during the period
From March 1 to November 30. inclusive, in any year: 371 cents per 100 pounds.
From December 1 in any year to the last day of the following February, inclusive: 60 cents per 100 pounds.
Provided, that such potatoes entered for consumption in the twelve-month period beginning on September 15 in the year 1938 or any subsequent year in excess of an aggregate quantity of 1,000,000 bushels of 60 pounds each shall not be entitled to a reduction in duty by virtue of this item, but the rate of duty thereon shall not exceed 75 cents per 100 pounds.
Provided further, that if for any calendar year the production of white or Irish potatoes, including seed potatoes, in the United States, according to the estimate made as of September 1 by the United States Department of Agricul ture, is less than 350,000,000 bushels of 61 pounds each, an additional quantity of such potatoes, other than certified seed potatoes, equal to the amount by which such estimated production is less than 350,000,00 bushels may be entered for consumption during the twelvemonth period beginning on September 15 of that year at the reduced rates above specified;
And provided further, that in computing the quantities of imports specified in the two foregoing provisos white or Irish potatoes produced in the Republic of Cuba shall not be included.
2222	COMMONS
Canada-United States Trade Agreement
Hugh Alexander Stewart: What is the rate on
potatoes coming into Canada compared with the rate on potatoes going into the United States?


William Daum Euler: The rate is 37i cents per
100 pounds from June 15 to the end of July and free for the rest of the year.


Hugh Alexander Stewart: What is the minister
quoting now?


William Daum Euler: The rate against the United States; the Canadian tariff.


Hugh Alexander Stewart: What is the rate against Canadian potatoes going into the United States?


William Daum Euler: That is given here; for
table potatoes it is 37i cents per 100 pounds from March 1 to November 30 inclusive in any year. From December 1 in any year to the last day of the following February, inclusive, it is 60 cents per 100 pounds, and there is a quota of 1,000,000 bushels.


Hugh Alexander Stewart: Then I am correct in
saying that the rate on potatoes going from Canada to the United States is higher than the rate on potatoes coming from the United States into Canada?


William Daum Euler: Yes, during certain parts
of the year.


Hugh Alexander Stewart: What part of the year?


William Daum Euler: I just gave it. The rate is
60 cents per 100 pounds from December 1 in any year until the last day of the following February. During certain parts of the year the rates are the same.


William Allen Walsh: I assume these items are
restricted to this particular description of potatoes?


William Daum Euler: There are two kinds, seed
potatoes and table potatoes.


William Allen Walsh: Are there quotas under these items?


William Daum Euler: Yes.


William Allen Walsh: And are these quotas dealt
with in much the same way as the quotas we discussed in the earlier part of the evening in connection with cattle? Are they quotas which must be filled within definite periods or are they annual quotas?


William Daum Euler: It is an annual quota beginning on September 15. There is a quota of
1,000,000 bushels a year in connection with table potatoes, with the exception that if the production in the United States in any year is less than 350,000,000 bushels, we get the fWr MacNicol.1
benefit of the difference. For instance, if their production should be 340,000,000 bushels our quota would be increased by the difference, which would be 10,000,000 bushels.


William Allen Walsh: While I was in Halifax I
was given to understand that the cold storage plant was pretty well filled with seed potatoes held there awaiting shipment to the United States. I was wondering if those potatoes were going to fill part of this quota and if it was the regular practice to hold them in Canada in storage, or if they were shipped through and held in storage in the United States.


William Daum Euler: No doubt they were waiting until the 37J cent rate came into force on March 1.


[Stage Direction]
Items agreed to.
United States tariff-773. Turnips and rutabagas: 12J cents per 100 pounds.
Item agreed to.
United States tariff-774. Carrots, radishes, and cauliflower, in their natural state: 25 per cent ad valorem.
Item agreed to.
United States tariff-779. Hay: $2.50 per ton of 2,000 pounds.
United States tariff

779. Straw: 75 cents per ton of 2,000 pounds.
Items agreed to.
United States tariff-802. Whiskey of all types or classes, not consisting 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: $2.50 per proof gallon.
William Allen Walsh: There has been no improvement under this item in regard to the possibility of shipping whisky into the United States. I am not interested in retaining the whisky in Canada, but I notice there is no opportunity for shipping a greater quantity into the United States market.


William Daum Euler: We have the full reduction of fifty per cent.


William Allen Walsh: Under the previous agreement, but there has been no further reduction under this agreement.


William Daum Euler: This is another case where our tariff is higher against United States whisky than their tariff is against our whisky.


William Allen Walsh: But presumably their whisky is not as good as ours; I do not know.


William Daum Euler: I do not know either.

Canada-United. States Trade Agreement


William Allen Walsh: We used to enjoy a considerable market for our whisky in the United States, but it seem difficult to get it in there at the present time. I just hope the government did the best it could to rid this country of the greatest possible amount of whisky.


William Daum Euler: We got the best terms we could.


[Stage Direction]
Item agreed to.
United States tariff-1001.	Flax straw:
$1.50 per ton.
Item agreed to.
United States tariff-1007.	Hose, suitable
for conducting liquids or gases, wholly or in chief value of vegetable fibre: 10 cents per pound and 71 per cent ad valorem.
Item agreed to.
United States tariff-1401. Uncoated papers commonly or commercially known as book paper, and all uncoated printing paper, not specially provided for, not including cover paper: J cent per pound and 5 per cent ad valorem.
Item agreed to.
United States tariff-1402. Pulpwood in rolls for use in the manufacture of wallboard, not plate finished, supercalendered or friction calendered, laminated by means of an adhesive substance, coated, surface stained or dyed, lined or vat-lined, embossed, printed, decorated or ornamented in any manner, nor cut into shapes for boxes or other articles and not specially provided for: 5 per cent ad valorem.
Item agreed to.
United States tariff-1404. Papers commonly or commercially known as tissue paper, stereotype paper, and copying paper, india and bible paper, condenser paper, carbon paper, coated or uncoated, bibulous paper, pottery paper, tissue paper for waxing, and all paper similar to any of the foregoing, not specially provided for, covered or uncovered, white or printed:
Weighing not over 6 pounds to the ream, and whether in sheets or any other form, valued at not more than 15 cents per pound: 3 cents per pound and 10 per cent ad valorem.
Weighing over 6 pounds and less than 10 pounds to the ream, valued at not more than 15 cents per pound: 21 cents per pound and 71 cents ad valorem.
United States tariff-1404.	Crepe paper,
commonly or commercially so known, including paper creped or partly creped in any manner, valued at not more than 121 cents per pound: 3 cents per pound and 71 per cent ad valorem.
Items agreed to.
United States tariff-1409. Hanging paper, not printed, lithographed, dyed or coloured: 71 per cent ad valorem.
Item agreed to.
United States tariff-1410. Tourist literature containing historical, geographic, time table, travel, hotel, or similar information, chiefly with respect to places or travel facilities outside the continental United States:
If of bona fide foreign authorship: 71 per cent ad valorem.
All other: 121 per cent ad valorem.
Item agreed to.
United States tariff-1410. Drawings, engravings, photographs, etchings, maps, and charts, containing additional text conveying historical, geographic, time table, travel, hotel, or similar information, chiefly with respect to places or travel facilities outside the continental United States: 121 per cent ad valorem.
Item agreed to.
United States tariff-1413.	Pulpboard in
rolls for use in the manufacture of wallboard, surface stained or dyed, lined or vat-lined, embossed, or printed: 15 per cent ad valorem.
Item agreed to.
United States tariff-1502. Lacrosse sticks: 15 per cent ad valorem.
Item agreed to.
United States tariff-1502. Ice skates and parts thereof: 15 per cent ad valorem.
Item agreed to.
United States tariff-1519 (c). Silver or black fox furs or skins, dressed or undressed, not specially provided for: 271 per cent ad valorem.
Item agreed to.
United States tariff-1530	(b). Leather
(except leather provided for in subparagraph (d) of paragraph 1530 of the Tariff Act of 1930), made from hides or skins of cattle of the bovine species:
(3)	Leather to be used in the manufacture of harness or saddlery: 10 per cent ad valorem.
(4)	Patent leather, rough, partly finished, or finished, or cut or wholly or partly manufactured into uppers, vamps, or any forms or shapes suitable for conversion into boots, shoes, or footwear: 71 per cent ad valorem.
Item agreed to.
United States tariff-1530 (e). Skating boots and shoes, made wholly or in chief value of leather, sewed or stitched by the process or method known as McKay, if attached to ice skates, and not specially provided for: 15 per cent ad valorem.
Item agreed to.
United States tariff-1532 (b). Gloves wholly or in chief value of leather made from horse-hides or cowhides (except calfskins), whether wholly or partly manufactured: 15 per cent ad valorem.
Item agreed to.
2224	COMMONS
Canada-United States Trade Agreement
United States tariff-1537 (b). Hose and tubing, having at no point an inside diameter of less than three-eighths of one inch, suitable for conducting liquids or gases, wholly or in chief value of india rubber (not known as "hard rubber") or gutta-percha, not specially provided for: 12J per cent ad valorem.
Item agreed to.
United States tariff-1541 (a). Pipe organs or pipe-organ player actions and parts thereof especially designed and constructed for installation and use in a particular church, or in a particular public auditorium at which it is not customary to charge an admission fee, which are imported for that specific use, and which are so installed and used within one year from the date of importation:
Pipe organs and parts thereof: 17i per cent ad valorem.
Pipe-organ player actions and parts thereof: 20 per cent ad valorem.
United States tariff

1541(a). Pipe organs and parts thereof, not specially provided for: 17J per cent ad valorem.
United States tariff-1541(a). Pipe organ player actions and parts thereof, not specially provided for: 30 per cent ad valorem.
Items agreed to.
United States tariff

1555.	Waste, not
specially provided for: 7i per cent ad valorem.
Item agreed to.
United States tariff-1558. Evergreen Christmas trees: 5 per cent ad valorem.
Item agreed to.
United States tariff-1601. Sulphuric acid or oil of vitriol: free.
Item agreed to.
United States tariff-1604. Agricultural implements: Plows, tooth or disc harrows, headers, harvesters, reapers, agricultural drills and planters, mowers, horserakes, cultivators, thrashing machines, wagons and carts, cream separators valued at not more than $50 each, and all other agricultural implements of any kind or description (except tractors), not specially provided for, whether in whole or in parts, including repair parts: free.
Item agreed to.
United States tariff-1606(a) and (b). Bulls, cows, hogs and sheep, imported by a citizen of the United States specially for breeding purposes: free, subject to the proviso to paragraph 1606 (a) and (b), Tariff Act of 1930.
Item agreed to.
United States tariff-1616. Asbestos, unmanufactured, asbestos crudes, fibers, stucco and sand and refuse containing not more than 15 per centum of foreign matter: free.
Item agreed to.
United States tariff-1641. Calcium: cyana-mid or lime nitrogen: free.
Item agreed to.

United States tariff-1651. Coal-tar products: Benzene, toluene, xylene, crude coal tar, crude blast-furnace tar, crude oil-gas tar, crude water-gas tar, and all other distillates of crude coal tar, not specially provided for, which on being subjected to distillation yield in the portion distilling below 190 degrees centrigrade a quantity of tar acids less than 5 per centum of the original distillate: free.
Item agreed to.
United States tariff-1652. Cobalt and cobalt ore: free.
Item agreed to.
United States tariff

1667. Sodium cyanide: free.
Item agreed to.
United States tariff-1669. All drugs of animal
origin, including fish livers, which are natural and uncompounded drugs and not edible, and not specially provided for, and are in a crude state, not advanced in value or condition by shredding, grinding, chipping, crushing, or any other process or treatment whatever beyond that essential to the proper packing of the drugs and the prevention of decay or deterioration pending manufacture, and not containing alcohol: free.
John Ritchie MacNicol: Mr. Chairman, you are reading a number of items I do not find in my statement at all. You are not putting anything over, I hope.


William Daum Euler: This is the free list, anyway.


[Stage Direction]
Item agreed to.
United States tariff-1672. Crude artificial abrasives, not specially provided for: free.
Item agreed to.
United States tariff-1681. Furs and skins, not specially provided for, undressed:
Mink, beaver, muskrat, wolf, including prairie wolf, skunk, otter, lynx, and fisher: free.
Item agreed to.
United States tariff-1688. Cattle-body hair (including calf-body hair) and horse-body hair, cleaned or uneleaned, but unmanufactured, not specially provided for: free.
Item agreed to.
United States tariff-1716. Mechanically round woodpulp, chemical wood pulp, unleached or bleached: free.
William Allen Walsh: I understand that the United States ship little or no wood pulp into Canada, which is only natural since Canada produces such huge quantities of this commodity. But am I correct in assuming that countries enjoying favoured nation treatment have the same privilege as the United States?


William Daum Euler: I assume my hon. friend refers to the most favoured nation arrangement.

Canada-United States Trade Agreement


William Allen Walsh: Yes.


William Daum Euler: Any country with which the United States has a most favoured nation agreement will be entitled to the same privileges we are.


William Allen Walsh: That is shipping into the United States; but it does not work both ways. It does not give those other nations the privilege to ship to Canada.


William Daum Euler: If we have a most favoured nation agreement with another country, we cannot give to the United States what we do not give to those other countries. We give to them what we give to the United States.


William Allen Walsh: But, for instance, this would not enable a country like Finland to ship wood pulp into Canada at the same rate as we ship wood pulp to the United States, or they ship it through to us?


William Daum Euler: No.


Hugh Alexander Stewart: Is it not a fact that many of these items were free prior to the 1935 agreement, and that they are just bound in this agreement?


William Daum Euler: Yes. It would appear that the hon. member for Mount Royal is referring to the other items. This schedule has to do with Canadian products going into the United States, not with products coming into Canada.


William Allen Walsh: I appreciate that, but I was afraid I would not be here when the items in the other category are called.


William Daum Euler: They have already been passed.


[Stage Direction]
Item agreed to.
United States tariff-1719. Minerals, crude, or not advanced in value or condition by refining or grinding, or by other process of manufacture, not specially provided for:
Lignite: free.
Natural gas: free.
Gravel: free.
Nepheline syenite: free.
Note: Nepheline syenite is subject to the proviso to item 214.
Item agreed to. .
United States tariff

1734.	Nickel ore,
nickel matte, and nickel oxide: free.
Item agreed to.
United States tariff-1743.	Plaster rock
(including anhydrite) and gypsum, crude: free.
Note:	The existing customs classification
treatment of gypsum which has been broken merely for the purpose of facilitating its shipment to the United States, as "crude" in accordance with the decision of the United States Court of Customs and Patent Appeals,
published as Treasury Decision 45725	(61
Treasury Decisions 1215), shall be continued during the effective period of this agreement.
Item agreed to.
United States tariff-1749.	Radium, and
salts of: free.
Item agreed to.
United States tariff-1756. Sea herring and smelts, fresh or frozen, whether or not packed in ice, and whether or not whole: free.
Item agreed to.
United States tariff-1758. Selenium, and salts of: free.
Item agreed to.
United States tariff-1760.	Shingles of
wood: free.
Provided, That the United States reserves the right to impose a customs duty, not exceeding 25 cents per square, on any red cedar shingles which may be entered, or withdrawal from warehouse, for consumption in any calendar year after 1938 in excess of a quantity to he specified by the United States, which quantity shall not be less than 30 per centum of the annual average for the preceding three calendar years of the combined total of the quantity of red cedar shingles shipped by producers in the United States and of the quantity of such shingles entered, or withdrawn from warehouse, for consumption (for the purposes of this Agreement, such combined total for the calendar year 1936 shall be considered as 7,526,056 squares).
Mr. TUSTIN:: I read in a press report
from Washington the other day that this item had been taken up by the government of the United States with the intention of trying to have the quota reduced. Would the minister say whether or not there is anything in that report?


William Daum Euler: I understand a member of the United States congress has introduced a bill to that effect. However it would be in conflict with the agreement, and could not override it. I do not think there is any possibility of it being enacted.


George James Tustin: I have the clipping here. The president's letter said, "This matter is being given the most careful attention."


John Ritchie MacNicol: That is an answer we get here.


William Daum Euler: We have heard governments make the same statement in another country.


[Stage Direction]
Item agreed to.
United States tariff-1761. Lobsters (except spiny lobsters), fresh or frozen (whether or not packed in ice), or prepared or preserved in any manner (including pastes and sauces) and not specially provided for: free.
Item agreed to.
2226	COMMONS
Canada-United States Trade Agreement
United States tariff-1761. Clams, quahaugs, oysters (except seed oysters), and crabs, fresh or frozen (whether or not packed in ice), and not specially provided for: free.
Item agreed to.
United States tariff-1761. Scallops, fresh but not frozen (whether or not packed in ice): free.
Item agreed to.
United States tariff-1772. Standard newsprint paper: free.
Hugh Alexander Stewart: How long has newsprint been free going into the United States?


Henry Herbert Stevens: Many years.


William Daum Euler: Since 1923 or 1922, I believe. Item agreed to.
United States tariff-1775. Stone and sand: Burrstone in blocks, rough or unmanufactured; quartzite; traprock;. rottenstone, tripoli, and sand, crude or manufactured; silica; cliff stone, freestone, granite, and sandstone, unmanufactured, and not suitable for use as monumental, paving or building stone; all the foregoing not specially provided for: free.


[Stage Direction]
Item agreed to.
United States tariff-1803(1). Timber hewn, sided, or squared, otherwise than by sawing, and round timber used for spars or in building wharves; sawed lumber and timber, not further manufactured than planed, and tongued and grooved; all the foregoing, if not of balsa, teak, cedar commercially known as Spanish cedar, lignum-vitae, lancewood, ebony, box, granadilla, mahogany, rosewood, satinwood, Japanese white oak, or Japanese maple, and not specially provided for: free.
Item agreed to.
United States tariff-1803(2). Logs; timber, round, unmanufactured; pulp woods; firewood, handle bolts, shingle bolts; and laths; all the foregoing, not cabinet woods or balsa, and not specially provided for: free.
Item agreed to.
. United States tariff-1804. Posts, railroad ties, and telephone, trolley, electric light, and telegraph poles of cedar or other woods: free.
Item agreed to.
United States tariff-1805. Pickets, palings, hoops, and staves of wood of all kinds: free.
Item agreed to.
United States import tax-601(c)(6). Lumber, including sawed timber, rough, or planed or dressed on one or more sides, except flooring made of maple, birch, and beech, and except lumber and timber of northern white pine (ptnus strobus), Norway pine (pin us resinosa), western white spruce, balsa, teak, cedar commercially known as Spanish cedar, lignum-vitae, lancewood, ebony, box, granadilla, mahogany, 
rosewood, satinwood, Japanese white oak, or Japanese maple: $1.50 per thousand feet, board measure.
Item agreed to.
United States import tax-601(c)(8). Shark oil and shark liver oil, including oil produced from sharks known as dogfish: 1| cents per pound.
Item agreed to.
Progress reported.
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Friday, March 24, 1939