Hon. CYRUS MACMILLAN (Queens) moved:: That the first report of special committee on social security, presented on March 16, be concurred in.
Mr. JEAN-FRANCOIS POULIOT (Temis-couata): Mr. Speaker, I have just a word to-say about this. I wish to congratulate the' hon. members of this committee on social security upon having made such a happy choice in the selection of a chairman. In fact there could be no better chairman than my hon. friend, the hon. member for Queens. I sincerely believe that social security will be in safe hands as long as he presides over the committee as he has over other committees during previous sessions.
I ask hon. members to be very careful about the report presented by Professor Marsh. I have glanced over it in the press, but have not yet had an opportunity to read the full text. I remember distinctly that a report on unemployment which he submitted some years ago to the federation of mayors was not at all comprehensive. I always have great fear about the idealistic tendencies of those who may be described as book worms. There are great differences between university professors. There are those who teach real science and are properly called learned men. There are others, of course, who live in the clouds and have but a vague idea of what is going on on mother earth. Those men are most dangerous. I am not ready yet to say that Professor Marsh is one of them. I shall wait and see.


Mr. E. G. HANSELL (Macleod):: Speaking, sir, to the motion to adopt the report of the committee I must confess that I was a bit alarmed at the tremendous publicity which this committee got at its first sitting. The material presented to the committee was hailed by press and radio as perhaps one of the greatest things that ever happened to Canada. I do not so regard it. I regard it as something that could have happened at any time. While the material presented to the committee was tremendously voluminous I think upon analysis it all boils down to one thing, that some scheme of insurance is being attempted that could have been attempted at any time and by any set of
1346
Questions

*men who had desired to initiate some scheme -any insurance company, for instance. I say I am alarmed because I think there is somewhere in the picture a perfectly devised propaganda machine for the purpose of making something look big when after all :it does not amount to a row of pins. That as my own conviction. I am not going to hold up the debate by any discussion of the details of the report, because the time will come when we can discuss it more fully.


[Stage Direction]
Motion agreed to.

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

Mr. NOSEWORTHY:: 1.	Has the Post Office Department a certified copy of a list of bona fide subscribers to the London Echot
2.	How many of these subscribers are in the city of London?
3.	Is the London Echo being delivered by letter carriers to non-subseribers at the same postage rate as that charged to subscribers?
4.	Does the London Echo, which received the status of a regular newspaper in 1879, comply now with the present day statutory requirements?


Mr. MULOCK:: 1.	As previously stated, postal privileges were granted in 1879. It is not the practice to require publishers to file copies of their subscription list with the Post Office after statutory postal privileges have been granted.
2.	See answer to No. 1.
3.	Rate on copies mailed for local delivery within letter carrier area is the same for copies addressed to non-subscribers as that for copies addressed to subscribers.
4.	Yes. See subsections (a), (b) and (d) of section 23 of the Post Office Act. As regards subsection (c), see answer to No. 3.


CANADIAN PACIFIC AIR SERVICE LINE TO BACOTVILLE, QUE.
Mr. WARD:: 1.	Has the Canadian Pacific Railway Company been granted a licence for a new air service line to Bagotville, Quebec?
2.	If so, has the Trans-Canada Air Lines been given the refusal of extending its own services into this territory?


Mr. HOWE:: 1.	Owing to congestion on the railways the Canadian Pacific Air Lines have been given
temporary permission for the carriage of mail and express between Quebec and Saguenay airport. No licence has been issued.
2.	The matter was discussed with TCA and it has been decided that as this route is in the nature of a feeder line and not equipped with the regular aids to air navigation for a main line operation, the proposed service could be provided more conveniently by Canadian Pacific Air Lines for the time being as an extension of their existing Montreal-Quebec service.


NATIONAL WAR SERVICES-HELEN DOHERTY
Mr. FRASER (Peterborough West):: 1.	In what capacity is Miss Helen Doherty employed in the Department of National War Services?
2.	What are the duties attached to such position?
3.	How long has she been employed in such position?
4.	What is the total remuneration which has been paid to her, either by way of salary or honorarium?
5.	What is the total which has been paid to her by way of travelling expenses and living allowance?
Mr. LaFLECHE:
1.	General assistant.
2.	Assists generally, makes surveys and special studies of activities of the department, exercises supervision as required.
3.	Two years and six months.
4.	$9,190.
5.	$162.85 travelling expenses.



MUNITIONS AND SUPPLY-NEW BRUNSWICK CONTRACTS FOR SHELL BOXES


Mr. FRASER (Peterborough West):: 1.	Has any provision been made to reimburse the members of all chartered bank staffs in Canada for the increased duties imposed upon them by ration coupon banking, etc.?
2.	If so, give the details.


Mr. ILSLEY:: 1.	This question relates to a matter of internal management of the individual banks.
2.	See No. 1.


INCREASE IN RAILWAY PASSENGER RATES
Mr. GREEN:: 1.	Has there been an increase within the last three months in railway passenger rates to the Pacific coast?
2.	If so, what was the amount of such increase?
3.	Was it approved by the government or any board, agency, controller or other authority appointed by, or under the government?


Mr. ILSLEY:: 1.	Yes. Passenger fares from eastern Canada by Canadian Lines to Pacific coast points were on a lower than normal basis to meet the competition of the combination on the United States frontier plus the lower
fares through the United States. The portion of these fares via United States routes which was charged within the United States was increased by order of the United States interstate commerce commission resulting in higher fares via the United States' routes than the lower rates available via Canadian routes. This situation affected not only fares from eastern Canadian points but also fares from many eastern United States points and the United States Lines insisted that the Canadian fares must be advanced to the level made effective within the United States; otherwise United States lines would be obliged to eliminate the Canadian Lines routings from their tariffs which would eliminate United States travel through Canada and have a very serious effect on the Canadian economy.
2.	The amount by which individual fares were increased varies with the point of origin. Specimen of the one-way and round trip fares which were in force on the 19th January, 1943, and on the 20th January, 1943, showing the increase in dollars and the percentage increase in each case is attached.
3.	Yes. The increase was approved by the Board of Transport Commissioners for Canada and its decision was concurred in by the wartime prices and trade board.


TO VANCOUVER. B.C.
[Stage Direction]
One-Way Fares
From	First Class	Intermediate Class	Coach Class	In effect Jan. 19/43	In effect Jan. 20/43	Increase	In effect Jan. 19/43	In effect Jan. 20/43	Increase	In effect Jan. 19/43	In effect Jan. 20/43	Increase	$ cts.	$ cts.	S cts.	%	$ cts.	$ cts.	$ cts.	%	3 cts.	$ cts.	§ cts.	%Toronto, Ont	76 25	83 65	7 40	9-70	56 70	62 14	5 44	9-59	47 90	52 50	4 60	9-60Ottawa, Ont	83 70	89 74	6 04	7-22	63 20	68 64	5 44	8-61	54 40	59 00	4 60	8-46Montreal, P.Q	87 55	93 59	6 04	6-90	66 50	71 19	4 69	705	57 70	61 55	3 85	6-67Saint John, N.B	103 55	109 99	6 44	6-22	78 60	83 39	4 79	610	69 80	73 75	3 95	5-66Halifax, N.S	108 90	114 94	6 04	5-55	84 10	89 04	4 94	5-87	75 30	79 40	4 10	5-44Totals	459 95	491 91	31 96	6-95	349 10	374 40	25 30	7-25	305 10	326 20	21 10	6-91
Round-Trip Fares
Time Limit-3 months
$	cts.	$	cts.	$	cts.	%	$	cts.	$	cts.	$	cts.	%	$	cts.	3	cts.	t	cts. %	Toronto, Ont	113	00	124	15	11	15	9-86	96	70	106	20	9	50	9-82	81	30	87	55	6	25	7-68Ottawa, Ont	128	30	139	45	11	15	8-69	112	00	121	50	9	50	8-48	93	20	100	85	7	65	8-20Montreal, P.Q	133	70	144	85	11	15	8-34	117	40	126	90	9	50	8-09	93	20	101	50	8	30	8-90Saint John, N.B	161	65	172	80	11	15	6-89	145	35	154	85	9	50	6-53	116	50	124	85	8	35	7-16Halifax, N.S	168	30	179	45	11	15	6-62	152	00	161	50	9	50	6-25	123	30	131	60	8	30	6-73Totals	704	95	760	70	55	75	7-90	623	45	670	95	47	50	7-61	507	50	546	35	38	85	7-65Grand Totals	1,164	90	1,252	61	87	71	7-52	972	33	1,045	35	72	80	7-48	812	60	872	55	59	95	7-38
Same fares also apply to Victoria, B.C., Prince Rupert, B.C., and New Westminster, B.C
1348	COMMONS
Questions	_____

Questions as Orders for Returns


Mr. HATFIELD:: 1.	What amount has been paid out by the commodity stabilization board to date since it was organized?
2.	On what commodities and what amount was paid out on each commodity?



COST-OF-LIVING BONUS  COST-OF-LIVING INDEX USED AS BASE

Mr. KNOWLES:: What commodities are used to arrive at the base for the cost-of-living index which is used in computing the amount of the cost-of-living bonus?


Mr. MacKINNON (Edmonton West):: Return tabled.



FLAX PRODUCTION AND PROCESSING

Mr. BENCE:: 1.	Was there any flax seed from which linseed oil and feed products is manufactured exported from Canada in, (a) the month of January, 1943, (b) the month of February, 1943?
2.	If so, how much was exported in each month ?
3.	Was there any flax processing plant in Canada idle at any time from January 1, 1943, to March 15, 1943, because of lack of flax seed?
4.	If so, for what period or periods was any such plant or plants so idle and what was the name and location of any such plant or plants?
5.	What wras the reason for such lack of flax seed?
6.	What is the estimated total amount of flax seed in Canada?
7.	Has the government received representations to the effect that there is a demand for the oil cake and other feed products derived from the processing of flax seed, for live stock purposes?
8.	Is there a shortage of oil cake and other feed products produced from the processing of flax seed, for the purpose of feeding live stock?



PENITENTIARIES-KINGSTON AND ST. VINCENT DE PAUL

Mr. LACOMBE:: 1.	What are the working hours per day of the guards at, (a) Kingston penitentiary, (b) St. Vincent de Paul penitentiary?
2.	What are the names of the permanent guards at St. Vincent de Paul penitentiary?
3.	How long have such permanent guards been employed?
4.	Do guards at St. Vincent de Paul penitentiary work on religious and legal holidays?



IRON ORES


[Stage Direction]
On the orders of the day:
Mr. M. J. COLDWELL (Rosetown-Biggar):: I should like to direct a question to the Minister of Munitions and Supply or the Minister of Finance. I have sent a copy of the question to the Minister of Munitions and Supply. The papers to-day contain a synopsis of certain agreements relating to the exploitation of Canadian iron ores by the Steep Rock Mines Limited. Will the minister table any agreements made to provide subventions on the transportation of the ore or relating to financial commitments to the company or railways in connection with the provision of transportation facilities, and so forth?


Hon. C. D. HOWE (Minister of Munitions and Supply):: Mr. Speaker, the provisions in question were contained in an order in council and published in the Canada Gazette, which is a public document, but I shall be glad to find them and table them at the next sitting.



FARM WORKERS


[Stage Direction]
On the orders of the day:
Mr. ROBERT FAIR (Battle River):: Mr. Speaker, I should like to direct a question to the government based on a news report in this morning's paper. It is a dispatch from Washington, as follows:
Washington, March 17.-Moved to militant action by reports of imminent food shortages, the United States Senate overrode war department protests to-day to pass, 50 to 24, a bill denying any more agricultural workers to the armed forces.


Some hon. MEMBERS:: Order.


Robert Fair: Is it the intention of the government to take similar action here?


Mr. SPEAKER:: Order. The other day I gave a ruling in regard to the reading of reports from newspapers and basing questions thereon, and I wish the hon. member would read that ruling again. The question is one that should be placed on the order paper.
Labour Conditions



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. ANGUS MacINNIS (Vancouver East):: I should like to direct a question to the Minister of Labour. I have received a telegram from the president of the paper makers' union at Ocean Falls, in which he calls my attention to a serious condition developing in that town. I should like to say a word as a background for my question. Ocean Falls is a company town. The houses in which the employees of the company live are company houses. When married employees of the company are called for military service-


Thomas Vien: Order. I am afraid I must refer the hon. member to the ruling I gave the other day with regard to questions on the orders of the day. The hon. gentleman is making statements of fact before asking his question. I gather that the question is not of sufficient urgency to warrant an answer on the orders of the day.


Angus MacInnis: I just wanted to give two or three facts in order to make my question intelligible.


Some hon. MEMBERS:: Order.


Angus MacInnis: The Speaker is here to preside over this house and I shall be quite willing to abide by his decision. I wanted to give a few statements of fact as a background to my question so that it would be intelligible.


Thomas Vien: The hon. gentleman is doing what I was endeavouring to rule on the other day, making statements of fact. After all his question is being asked for the purpose of receiving an answer, not for the giving of facts. I suggest to the hon. member that he follow the ruling I have already given.


Angus MacInnis: Then I will ask my question at once. Can the minister assure the house that action will be taken to prevent the eviction of the families affected until other accommodation is provided for them? I am told that the situation is urgent.


Hon. HUMPHREY MITCHELL (Minister of Labour):: The hon. member was good
enough to give me notice of the question. I think I should say to him that this was the first I had heard of the matter, and it was just before the house assembled this afternoon. He can rest assured that I shall certainly have the matter looked into by my department in an effort to see if anything can be done, if the facts are as he has indicated them to be.



PASSPORTS


[Stage Direction]
On the orders of the day:
Mr. NORMAN J. M. LOCKHART (Lincoln) : One rises, Mr. Speaker, in some fear and trepidation these days to ask a question.
Some hon. MEMBERS. Order.
Thomas Vien: I assure the hon. member that he need not rise in fear and trepidation if his question is in order.


Mr. LOCKHART:: I desire to direct a
question to the Prime Minister. Apparently I may not make any explanation. There is a definite misconception of the passport regulations at border points. The new regulations make it evident that a man living at say Kingston must come to Ottawa to have the new form completed, which is a very serious inconvenience. Will the Prime Minister see that a full and definite statement is made so that people will know whether it is better to follow the present procedure or whether they can choose between it and the old form of passport, which some of them seem to think they cannot now obtain because of the new regulations?


Right Hon. W. L. MACKENZIE KING (Prime Minister):: I made a statement on the subject at the time the change was made. But I shall direct the attention of the passport office to the apparent incompleteness of the statement in the light of what my hon. friend has said, and shall make a new statement at an early date.
PRIVILEGE-Mr. CHURCH



REFERENCE TO REMARKS OF MINISTER OF NATIONAL DEFENCE FOR NAVAL SERVICES IN DEBATE ON MARCH 17

[Stage Direction]
On the orders of the day:
Mr. T. L. CHURCH (Broadview):: Mr. Speaker, I rise to a question of privilege. About the time the house closed yesterday afternoon, a derogatory reference was made to me when I asked a question about the very grave danger from lack of escorts in the Atlantic and the gulf of St. Lawrence. My remarks on this subject are reported in Hansard of Wednesday and Thursday, March 10 and 11, and I wish to read three or four sentences in justification of my position. On. March 10, as reported at pages 1150 and 1151, I said:
To-day I had occasion to ask one of the ministers a question, in a desire to encourage him in his work. . . .

Privilege-Mr. Church
I then pointed out that I was one of those who supported the increased estimates brought down before the war, and I added:
Those estimates were opposed by a great many hon. members . . . Since the beginning of the war 1 have believed in giving the government of the day all possible support, because they are the government and need encouragement. Our forces on land and sea and in the air have been magnificent. The history of courage has been gloriously rewritten in this war by those young Canadians who are serving in o'ur armed forces and by the splendid showing of our navy. . . .
I sympathize with the hon. gentleman who is head of our department of naval services; he is not to blame, but I must say that a year ago I pointed out to him the condition that had been found by General de Gaulle around St. Pierre and Miquelon and in the gulf of St. Lawrence and the German submarines there.
I said further, on page 1151:
At that time I also told the minister that we were in danger of being invaded; as the axis had submarines capable of crossing the Atlantic without refuelling; and all during the sessions of 1936, 1937, 1938 and 1939, until the war started, ... I asked if we were to -wait until the enemy came up the St. Lawrence by land, by sea and in the air . . . before doing anything to defend ourselves.
I pointed out, in general, the grave danger of invasion.
Now, one or two sentences from my remarks when I continued the debate last Thursday. I referred to the cry about home defence, and in support of what the minister had said, I pointed out that many of the countries of Europe had been invaded by mechanized hordes, that there is no such thing as home defence, that we have to go and meet the foe wherever he is. I had previously called attention to what Mr. Lyttelton, minister of production, had said in New York last November, and to the statement of Mr. Knox at Washington. I quoted statements made by Mr. Churchill in the House of Commons on two occasions as to the grave danger to the North African expedition from lack of escorts, and endeavoured to strengthen the minister in what he had said to the people in Quebec as to the danger to Atlantic and gulf shipping.
I have been a member of this house for many years, and never in my life have I sneered or gibed at anybody. I believe the minister's statement was right that at times there is not the same danger in the gulf as out in the ocean, and all I was urging was that we should have a statement as to our escort strength in the north Atlantic and gulf and the approaches to Canada. If the minister had been good enough to respond to that question a month ago I believe the effects 72537-86
would have been very satisfactory. When the war started I urged the Prime Minister (Mr. Mackenzie King) to give the utmost information possible to the people. After all, I could have secured this information in the reading room, from our Canadian papers or from American and British publications.
All I want is fair play here. I admit I sometimes take part in debates, but I do so as a member of the opposition, not because I want to-far from it. Since I have been a member of this house I have never indulged in any sneers or gibes or said one word against the armed forces. The present Minister of Pensions and National Health (Mr. Mackenzie) when he was defence minister did do something to strengthen our military forces as did the late Norman Rogers, and I referred to this in my speech on March 10 and 11 on rearmament.
I am here for one object only. I am not a yes man or a nodder. While the war is on I shall support the government as long as they are the government and provided they make a total war effort, but I intend to do my duty no matter if I suffer from doing so.
May I say in conclusion that I think the remark of the minister was most unfair. However, I will let it go; I do not wish to have any run-in with the minister. I never met him in my life until he came to the house. I think that yesterday was a day he might have left an Irishman alone, since he is grand master of the knights of Scotland.



THE RED CROSS


[Stage Direction]
On the orders of the day:
Mr. J. G. DIEFENBAKER (Lake Centre):: I wish to address to the Minister of Trade and Commerce a question which has to do with the current Red Cross campaign, namely, whether the government will give consideration to allowing farmers in the prairie provinces who wish to contribute to the Red Cross to do so by making deliveries for the purpose outside of the quotas now fixed for the delivery of wheat.


James Angus MacKinnon: The hon. member for Lake Centre was kind enough to give me notice that he intended to ask this question. The government has not considered this particular charity but a great deal of consideration was given recently to a request on behalf of another charity in a similar campaign. The whole matter is tied up with the wheat quota existing in connection

Rural Mail Couriers

with farm deliveries in western Canada. The basis of that is to maintain equity between one producer and another; and, particularly this year, when there is such a lack of transportation and storage, our difficulties would be greatly augmented if we decided to accept quantities of grain over the quota.


John George Diefenbaker: It is assumed that about a million bushels would be donated.


James Angus MacKinnon: Well, the greater the return in the campaign, the more generous the response, the greater the difficulty would be for those administering the wheat quota system. As a matter of fact there would be a direct detrimental effect to the other producers in the west.



RURAL MAIL COURIERS


[Stage Direction]
On the orders of the day:
Hon. W. P. MULOCK (Postmaster General):: The hon. member for Peterborough West (Mr. Fraser) has asked if I would make a statement to the house dealing with representations by the rural mail couriers' organizations, relating to permanency of appointment, basic salaries and allowances, as well as cost-of-living bonuses.
The hon. member's statement that representations had been made by rural mail couriers' organizations relating to permanency of appointment, basic salaries and cost of living bonuses, is correct. Action has already been taken under order in council P.C. 8490 of 31st October, 1941, to grant a bonus of five per cent to all mail contractors whose contracts were awarded on tenders dated on or before the 29th April, 1941, in accordance with section 66 of the Post Office Act, or whose contracts involving an annual expenditure of less than $200 were made in accordance with section 73 of the Post Office Act at rates determined on or before the 29th April, 1941, with the proviso that the increase shall apply only to payments made for work performed as from the 1st August, 1941.
On the question of permanency of appointment for rural mail couriers, which was one of the points raised by the hon. member for Peterborough West, I would advise hon. members that there are two serious objections to any such change being made at the present time.
The first objection is that if all the present mail couriers were given permanency, all men now serving in the armed forces of Canada
would be automatically deprived of the opportunity of obtaining mail contracts for many years to come.
The second serious objection is that such a proposal presupposes that all the present couriers are the most suitable couriers obtainable. As a matter of fact, the present couriers secured their positions because they underbid the previous contractors under a tender system which they now criticize.
On the question of basic salaries, which is another point raised, payment is sought on a flat mileage basis rather than as a result of public tenders. The objection to this suggestion arises from the fact that no two mail routes can be regarded as identical. Road conditions, number of boxes and way post offices to be served, severity of weather conditions and hours of service, all vary to such an extent as to make the determination of a fair uniform mileage rate for the whole dominion impractical.
The whole question of mail contract procedure is constantly under review, and while it is admitted that the tender system may lead to the completion of some contracts at rates too low for the work involved, largely because the tenderer failed to make a proper estimate of costs, the difficulty is, no alternative procedure has as yet been advanced which under ordinary conditions would be any more equitable to all concerned. Wartime conditions, however, have in a number of cases, resulted in greatly enhanced expenditures by the contractor, unforeseen when the original contract was signed. These may be adjusted while war-time conditions exist, but no general change in the existing procedure is contemplated at the present time.



THE BUDGET


[Stage Direction]
The house resumed from Wednesday, March 17, consideration of the motion of Hon. J. L. Ilsley (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Blackmore, and the amendment to the amendment of Mr. Coldwell.
Hon. R. B. HANSON (York-Sunbury):: Mr. Speaker, in rising to make a contribution to this debate I find myself in some difficulty. There is such a multiplicity of topics to which one could direct his attention that it is difficult to pick and choose among them.
I think my first duty is to make reference to the announcement yesterday by the Minister
(Mr. J. A. MacKinnon.]

The Budget-Mr. Hanson (York-Sunbury)
of Finance (Mr. Ilsley) of the fourth victory loan, and to give him and the national committee the assurance that this party will be one hundred per cent behind this, the greatest national effort the Canadian people have ever made with respect to finance.
Financial support is one of the sinews of war; it is more than a mere measure of our effort. This nation will respond in full measure to the national appeal. With all my heart I endorse the minister's appeal. In the past a3 opportunity offered I tried to pull my full weight in these financial campaigns. The Easter recess will afford every one of us another opportunity for service to Canada, and I appeal to every member of parliament as he goes home for the recess to get in touch with his provincial and county committees, and to offer his services in any capacity, so as to help put this loan over the top. By so doing, hon. members will be rendering a national service and giving the leadership which is so necessary if this huge loan is to be a success. Members of parliament from one end of Canada to the other should be, and I hope are, leaders of public opinion in their respective communities. Here is another chance to show our people our faith in our country and the cause for which we fight.
I have said in the house many a time and oft that the Canadian people would support the government to the limit provided that they were sure of equality of service and equality of sacrifice, and that there should be an end to waste and extravagance. I wish I could think there has been an end to waste and extravagance in government spending, but in all truth and honesty I do not think so. I beseech the minister, the watchdog of the treasury, to prevent improvident expenditures.
I wish to make brief reference to the speech of the hon. member for Lambton West (Mr. Gray), who is now in his seat. Referring to the man-power question the hon. member made reference to myself and my stand on the policy of national selective service. I am grateful to him for his commendation of my stand, but I suggest to him that his remarks were hardly fair to the membership of this party and its stand on this important question. If the hon. member has not yet read the resolution of the national convention of the Progressive Conservative party as passed at Winnipeg, he should do so at once. In that resolution, this party declared for compulsory selective service and total mobilization of resources, in the following words-I propose to put them on record:
Recognizing that the world struggle in which Canada is engaged requires a total war effort, we believe in compulsory national selective 72537-86J
service, and that all those selected to serve in the armed forces should be available for service wherever required. We believe in the effective total utlization and proper allocation for war, by compulsion where necessary, of all the resources of Canada, including agriculture, industry and finance, as well as man-power, and that our aim should be at all times to bring about, so far as human means can achieve it, an equality in sacrifice.
I commend to the hon. member and to the people of Canada the principles underlying this resolution.. It is what I have been saying for a good many months past. By those principles the Progressive Conservative party stands and will be judged1 in the days to come.
The hon. member for Lambton West made his profession of faith in the following terms:
I believe . . . that in a free society the obligations and privileges of military training should be shared generally in accordance with a fair and just system of selective compulsory raining, and that such service should be without geographic restriction.
I commend that position also, and I suggest the hon. member might have gone further and told the people of Canada, as I tell them now, that without an acceptance of the national plan of military service there should be no demands for rights in the postwar world. We in Canada have never been taught our national obligations. I have referred on more than one occasion to the excuse-not the reason-which was given for the establishment of the thirty-day training plan. One of the main reasons alleged was that the youth of Canada had to be taught a sense of national obligation. I am not going to labour that point now, but I want to observe that while we are all clamouring for rights and privileges, national obligations have not found much place in our peace-time or war-time philosophy. If we are to believe the reports that have reached us in recent days and hours, there are momentous days ahead. From the Russian theatre of war we had until a few days ago very heartening reports which have raised optimism to the point of believing that Germany was in a state of collapse and that the end of the war is near, might even be expected this year. But events within recent days have dispelled that illusion. The display of German striking power against Russia in recent days has been terrific. Disaster has not come to German arms in that theatre of war. A titanic struggle is developing over there, with the approach of spring and summer, and the end is not yet.
Consider the battle of North Africa, part of the Casablanca plan and strategy. Reports
1354	COMMONS
The Budget-Mr. Hanson (York-Sunbury)
indicate that the battle is developing into a major struggle, the result of which is still in grave doubt. Instead of being a matter of weeks it has developed into a battle of months, and in the meantime the invasion of the soft underflank of Europe has been indefinitely postponed. Clearly the next few months will be momentous, and terrific sacrifices will be demanded of the people of the united nations.
Instead of viewing these matters in their proper perspective, what are we doing, and what have we been doing in this house? We have been talking about social security and like matters, while the fate of the civilized world hangs in the balance. Let us get back to realities and face the facts. Let first things come first. Let us put our backs into the winning of this war. That is our first [DOT]objective. Do not let our minds and attention be diverted into other channels; for that way lie defeat and disaster.
We are also hearing a good deal at this time about post-war international policies. There are even those who are drawing blueprints of a post-war international phase of the life of this globe. My colleague the hon. member for Lake Centre (Mr. Diefenbaker) yesterday in an able speech delivered in this house, made some constructive proposals in that regard, especially with reference to the principle of the freedom of the air. I do not deprecate that; I am not opposed to that type of discussion. But it seems to me that concrete proposals are altogether premature at this time, when we do not know, when we are not yet assured, that there will be a post-war world in the sense in which we visualize it. Rather I am disposed to concur wholeheartedly in the statement of the President of the United States at a press conference at Washington on Tuesday last, in which he is reported to have indicated *disagreement with those who would frame post-war international policies in detail now. He said that what the United States was trying to do was, first, to win the war; second, to work towards general objectives. With that statement I am in perfect agreement. He indicated that his administration did not favour any pronouncement at this time on post-war policy except as to general willingness to cooperate with all the other united [DOT]nations.
There is one great principle however which Canada as a nation should ever keep in the forefront in dealing with this subject, and that is that Canada should never give countenance to any idea of dismemberment of the empire

in the post-war period. The party to which I have the honour to belong and which I have followed all my life is unequivocally committed to the belief that the future of this dominion as a free nation can best be assured as a member of the British commonwealth of nations. By that declaration we stand or fall. We believe that second only in importance to the winning of the war is the maintenance of the British connection and our position as a component part of the British empire.
I have no intention of entering into any discussion of the policies and actions of the wartime prices and trade board; we heard something about that on Monday. But, representing as I do a semi-urban and rural constituency, I feel that some recent decisions of the board call for comment. First, I refer to butter. The situation with respect to dairy process butter in my province is still unsatisfactory, to say the least. There is still a discrimination between the price, the farmer receives for butterfat delivered to the creameries and the price the farmer receives for his dairy butter. At first this discrimination amounted to as much as ten cents a pound, which for as long as that full rate lasted is lost forever to the producer. Recently a corrective order was made under which a portion-only a portion-of this spread was to be wiped out, by dairy farmers being permitted to sell dairy butter to wholesalers and retailers at an increased price. This is certainly a benefit and has gone some way toward ending the discrimination between these two classes of producers. But a portion of the differential still exists and is a cause of unrest and even anger on the part of our dairy butter producers; for in my province sixty per cent of the butter is produced by dairy farmers.
I wish to refer also to the action of the wartime prices and trade board in respect to the question of seed potatoes. Down in the provinces of New Brunswick and Prince Edward Island we claim to raise the best seed potatoes on the north American continent. They are the cleanest and the freest from plant diseases. For a long time our agriculture departments, both provincial and federal, have been endeavouring to get our farmers out of the production of table stock and into the production of seed stock. The question has been largely one of markets. One of the best markets we ever had for seed stock was in Cuba. That market was closed to us, for reasons to which I will not advert at the moment. More recently, under the trade agreements with the United States, quotas were established for the entry of our

The Budget-Mr. Hanson (York-Sunbury)
seed stock into that country. The quotas were so small that I am informed by producers that the county of Queens, Prince Edward Island, could supply the whole quota in any given year. That may or may not be true, but in any case under the trade treaties we did get some access to the seed potato market of the United States. It is a market into which we have sought entry for a long time. They want our seed stock; their fields, particularly in northern Maine- and I say this with some deference-are old and diseased, and they cannot produce unless they have access to good clean stock. Prices for seed stock have always been higher than prices for table stock, but I understand that now the wartime prices and trade board have either imposed an embargo on the export of seed potatoes to the United States, or have made such export subject to licence.	I
suggest to the minister under whose control the matter would come that this is a mistake from every point of view. A determined effort should be made to change that position, and I would ask the member of the government responsible to direct that the whole matter be reviewed. Not only shall we lose the export market in the United States, and the greatly enhanced price of the product; we will lose what I consider to be of at least equal value, the good will of our customers across the line. They will resent that action. I do not know, but I would assume that so far as the New Brunswick product is concerned, there is an ample supply of table stock. According to the local newspaper, which I received at noon to-day, there are at present 16,000 more tons of table stock available in New Brunswick than were available at this time last year. Now, with the prohibition of the export of seed potatoes to the United States, there may be something of a glut. I do not know that this will be so, but I do know that the producers of seed potatoes will be obliged to accept in the local market the price of table stock instead of the greatly enhanced price they would have received had those potatoes been sold for the purpose for which they were produced, namely seed potatoes.
I should like to know what consultation there was with the trade before this action was taken. How can these men-none of them producers, so far as I am aware; economists and theorists if you will, office men-sitting here and looking at a picture on paper, looking at statistics, possibly know what should be done? I suggest to the minister that this position should be rectified at the earliest possible moment, and the producers allowed the price they would have
obtained in this export field at least. I suggest also that if possible they be allowed to retain this market which has been laboriously built up over a period of years.
Then there is the question of the allocation of farm machinery under the greatly reduced quotas. Our farmers are confronted with an exceedingly grave problem, so I am informed, with respect to obtaining farm machinery and parts. A controller has been appointed with headquarters in Toronto, and he has allotted to the maritime provinces so many machines and so many parts. In New Brunswick the two principal companies supplying the market are International Harvester and Massey-Harris. The quantity allotted is exceedingly limited. The whole output of International Harvester is controlled in New Brunswick by one company, or rather I should say by two companies controlled by one man. They have the whole province divided among their branches, with respect to the distribution of farm machinery. For some reason one of the executives of one of these companies under the control of this one man has been made the farm machinery controller for the distribution of this machineiy in. New Brunswick. Well, I do not say there is anything wrong with that on its face, but I do say that the public down there are very suspicious about appointments of that kind. Why in the world should a high-salaried officer of these two companies, which between them control the major part of the marketing of farm machinery in New Brunswick, be placed in the position of controller for the whole province? You can draw your own inference. I am going to ask the minister to see that this position is reviewed and that some independent authority down there is made controller, if a controller is required. Human nature being as it is, you can guess as well as I can what will be the result. Within the last few days I was told that the quotas allotted to New Brunswick provided only ten or twelve potato planters for the whole province. This may be all that can be spared, I Jo not know; but the allocation of these planters already has been made through the-medium to which I have referred, with no' one else having a look-in at all. Then when the farmers, in anticipation of fall digging, applied for the purchase of diggers, they were told that it was too soon to ask for them. I suggest that the whole procedure is bringing into disrepute the system which is in operation, and it should be reviewed.
I desire now to say a brief word on the budget. I listened with undivided attention to the minister's address, and I am bound to
1356	COMMONS
The Budget-Mr. Hanson (York-Sunbury)
tell him that my first reaction was that it might have been far worse than it was. But a careful re-reading and analysis has convinced me that while the minister intended to emphasize and did emphasize the fact that the rates of taxation were not being raised, the real truth is that the deadweight of taxation, especially on personal income tax payers, has been greatly increased. Those who sought relief are going to be speedily and quickly disillusioned. Holding the views which t do as to our first fundamental duty in this hour of crisis, I have no wish to appear picayune or to be unnecessarily critical. I had made some notes of criticisms I intended to offer on the general features of the budget, but as time is flying I shall confine myself to one or two points.
I wish to discuss briefly the Ruml plan and its application to Canada. The people of Canada, speaking generally, and the personal income tax payers in particular, are greatly disappointed at the minister's treatment of the proposal known as the Ruml plan. True, the reference in the speech from the throne itself was indefinite, but what the people of Canada believed from the information contained in the speech from the throne was that the plan and the principle underlying it would be implemented and put into operation, thus relieving personal income tax payers of the fear and anxiety of being perpetually indebted to the nation. Deadweight debt has a most paralyzing effect on individual morale and initiative.
What did Mr. Ruml propose in his plan for the United States, a plan which is applicable to Canada? He proposed that the United States should write off all 1942 personal income tax in order to put everyone on a current basis, without forcing anyone to pay two years taxes in one, and in order that the deadweight of debt on individuals should be wiped out. What have we instead? I characterize it as a hybrid proposal. The minister made us pay all our 1941 taxes by September 1, 1942, and then he asked us to pay one-third of our 1942 taxes. In other words, because of the delay in bringing down the budget last year until June 23, the personal income tax payers of Canada were forced to pay sixteen months taxes out of twelve months income and had to make the necessary arrangements in the six months of the last period of the calendar year. We were not told that we must do this until late in June when nearly six of the twelve months had elapsed. In other words, to put an extreme case, we had to pay sixteen months taxes with only six months in which to make our plans and
provisions. It was a tremendous burden upon the personal income tax payers and was wholly unfair.
When the Ruml plan was suggested and acclaimed by almost everybody in Canada as a measure of relief I felt that the government was about to do justice to a group of loyal but hard-pressed citizens. What did we get? We got the Ilsley plan. The minister adopted the principle of current taxation, but he did not adopt the plan for making it current. There is a joker or a hang-over in it. I hope the minister will give consideration to the question of wiping out the arrears for 1942 and making the necessary adjustments. His plan falls far short of what was expected and what we had a right to expect. The Ruml plan, proposed to write off the 1942 taxation in order to put the tax payer on a current basis without forcing him to pay two years' taxes in one year. The minister's device is to write off fifty per cent of the 1942 taxes, but that leaves many people in substantial debt to the government. The full weight of the 1943 taxation is on us immediately and must be met out of incomes which are still further reduced. I am referring to incomes on investment. As a result of the last budget, whether we like it or not, capital values were diminished by hundreds of millions of dollars because of decreases in dividends for distribution to shareholders. The natural result must be that investment income will shrink, and I believe that that is the fact.
There is another aspect of the income tax law to which I desire to make reference, namely, the question of the taxes on annuities. Subsection (g) of section 3 of the Income War Tax Act as amended in 1942 provides:
Annuities or other annual payments received under the provisions of any will or trust, irrespective of the date on which such will or trust became effective, and notwithstanding that the annuity or annual payments are in whole or in part paid out of capital funds of the estate or trust and whether the same is received in periods longer or shorter than one year-
Shall be deemed to be income. It declares by law to be income that which is not true income. It reminds me of a passage which the attorney general of New Brunswick once put into the succession duty act of that province years ago. It declared by law that property coming from an estate ot a deceased person in another province falling into the hands of recipients in the province of New Brunswick was deemed to be property within the province and thus taxable. It aroused my ire that a thing should be declared to be that which it was not. This is in exactly the same category. I have always thought that this provision was most unjust.

MARCH IS, 1943	1357
The Budget-Mr. Hanson (York-Sunbury)
The effect of this provision is to tax annual payments which a testator or donor has directed to be made out of the capital of his estate, usually to supplement an inadequate income. It is in essence a capital levy, and in the final analysis is pure confiscation. This amendment affects a substantial number of estates and trusts. I have been privileged to read a booklet issued by the National Trust Company, Limited, in which several examples are given. I shall confine myself to two.
A testator who died many years ago directed the trust company, as executor, to pay to his widow out of the residue of his estate, which amounted to approximately $36,000, a very modest estate, an annuity of $2,400, to be made up out of income and the balance out of capital. Owing to the heavy encroachments necessary to provide this annual payment, the capital of the estate has now been reduced to approximately $S,000, with an annual income of $260. In order to pay the widow $2,400 the executors must take $2,140 out of capital. Under the Income War Tax Act as it stands to-day, the total payment of $2,400, although approximately ninety per cent of it is pure capital, is taxed as income in the hands of the widow. The annual tax amounts to something over $800.
In another case the testator directed that his widow should receive $3,600 a year. The entire income of the estate did not exceed $800 per annum, so that the $2,800 required to make the annual payment had to be taken out of capital. Again the tax is based on the $3,600, and it amounts to $1,478.
This is confiscation pure and simple. I suggest to the minister that it should never have become law and believing him to be a man of just and equitable mind I urge upon him that he have this whole position reviewed in the light of the facts. I do not know who is responsible for it, but surely the minister did not understand the implications of the amendment to the act when he made it. There may be justification for it, but I am certainly not aware of it. I can think of many arguments against it. I have not the time to go into them to-day, but I do hope the minister will review this position. It gives rise to discrimination against a fairly limited number of income tax payers. It is all very well to say that you can overcome the difficulty by a will. But these injustices arise after the event. Wills which may have been improvident at the time they were made are effective once a testator dies. To adopt my suggestion would be but a measure of justice.
I want to refer to the method of income tax collection. We hear practically nothing
about income tax collection except the quantum of the sum collected. The wide extension of the incidence of income tax in the last few years has undoubtedly led to a huge expansion of work in the income tax department. The view seems to be generally held that this department is grossly understaffed, and that, as a result the checking of income tax returns, both personal and corporate, is inadequate and very much behind schedule. I should like to know what is the number of the employees in the income tax department as of, say, January 31, 1943, as compared with the number on the same date in 1941, and generally what plans have been made to cope with the huge increase in volume of business which must necessarily take place with the filing of this year's returns.
I pause here, Mr. Speaker, to pay my personal tribute to the commissioner for his fairness and his sense of equity and justice. But it is only fair to say that he does not lay down policy. He is purely an administrative officer, administering government policies which are handed to him.
I want some information from the minister when the proper time arrives with respect to the operation of the board of review with respect to depressed industries. How many applications have been made for fixing standard profits or revising them upwards? How many such applications have been dealt with definitively by the board of review?
If, as I have been told, the total in suspense greatly exceeds those in connection with which decisions have been given, would it not be advisable to set up additional panels to expedite consideration of these applications? The present experienced board might then confine its work to important cases and reviewing decisions which are protested by applicants. I have no doubt that it is the practice of most companies, particularly large incorporated companies, to calculate profits and pay their taxes meticulously-that is my own experience-but the idea is held in some quarters that some private companies, partnerships and personal businesses are getting away with murder. That is a pretty strong statement, but that is the report I have had. I have been told also that in certain cases where evasion of income tax extending over a period of years has been brought to light the guilty parties have in many cases been let off with a compromise instead of being fined or prosecuted. If this is so, it is putting a premium on dishonesty. With the present high tax rate, human nature being what it is, it is inevitable that all legal means should be adopted to save the maximum amount
1358	COMMONS
The Budget-Mr. Hanson (York-Sunbury)
from the tax collector, but, if we are not to put a premium on dishonesty, deliberate falsification of accounts should be dealt with ruthlessly and publicity given to the circumstances. That will stop the practice. I should like to know how many legal actions have been taken in the courts to recover income tax. I have never heard or read of one such case in the public press, neither have I heard of any case where there have been prosecutions in the criminal courts for violations of the act and fines imposed and collected. I should like to know what the position is in that regard.
I had intended to refer to the amendment and the subamendment moved by the parties to my left, but I am not sure that I have time. The main amendment moved by the hon. member for Lethbridge (Mr. Blackmore) is in effect a repetition of the proposals which have been made from time to time in this house by that hon. gentleman and his followers, who are proposing a new and different and untried, and, may I say, unorthodox method of financing the national war effort. With great respect I entirely disagree with his policies, but I shall not pause here to debate either the merits or the machinery of the proposals which he advocates.
I do desire, however, to say something about the subamendment moved by the socialist party, in so far as it relates to the nationalization of the chartered banks and other financial institutions in this country. As to that part of the amendment which deals with the question of increasing the old age pensions, I wish the hon. gentleman had severed it from the rest, because I have arrived at the conclusion that old age pensions in this country will have to be increased, that the age limit for males will have to be lowered and the age limit for females lowered still further. Speaking for myself, if that portion of his proposals had been left to itself I should have voted for it.
With regard to his proposal with respect to the nationalization of our financial institutions, I am in entire disagreement. I believe in private enterprise, controlled, if you will, against abuse; but I have been a voice crying in the wilderness in this house. I do believe, however, that there is a multitude of members in this house who believe as I do, if they would only be true to themselves and get up on their feet and say so.


Mr. FULFORD:: I do.


Richard Burpee Hanson: I am glad to hear that, but that is just one, and if the hon. member will forgive me for saying it, perhaps his advocacy of the principle will not
help it. I do not say that in any offensive sense at all, and my hon. friend will understand me, I hope. I do wish that the membership of this house who believe in the principle of private initiative and private enterprise would stand up in their places and champion that principle which has put them in this house and made it possible for the people of Canada to develop this country.


Mr. BLAIR:: We all believe in it.


Richard Burpee Hanson: All right. Then silence must give consent. What has brought this country to the high level of prosperity which it has reached? It is private enterprise which has built up and improved our economic system ever since the advent of the Christian era. And now at one fell stroke, if the policies of my friends to my left were put into operation, it would be wiped out and we should all be regimented by an army of government officials who would tell us when we should get up in the morning, when we should go to bed, what we should eat and what we should not eat for dinner. I am all against that. Mr. Coolidge was asked by his wife one Sunday when he came home from church what the preacher had been talking about. Mr. Coolidge replied "Sin". "What did he say about it?" she asked; and Mr. Coolidge replied laconically, "He was against it". I am against it. I believe that the thinking people of this country will stand behind the principle of private initiative and private enterprise which has made Canada as prosperous as she is, has made all the free democracies under the British empire as prosperous as they are, and has built up on this continent the great and rich and powerful republic of the United States. The system of free enterprise may have been exploited and abused, if you will. I admit that. But with all its abuses it is a far better system than government regimentation and national socialism. What does it mean? What is the ultimate aim of national socialism? Well, it is fascism.


Mr. DOUGLAS (Weyburn):: There is no national socialism in this country.


Richard Burpee Hanson: They can deny it, but I can see as far through a stone wall as anybody.


Thomas Vien: The hon. member has
spoken forty minutes.


Richard Burpee Hanson: I do not like to trespass on the indulgence of the house, but I shall not be very long. If I have not consent, I will not continue.

The Budget-Mr. Hanson (York-Sunbury)


Some hon. MEMBERS:: Go on.


Thomas Vien: With unanimous consent.


Mr. ROSS (Moose Jaw):: Now that the hon. member has it he can go on as long as he likes. At any rate he can go another forty minutes.


Richard Burpee Hanson: No, I shall not be long now.
I am not so much concerned with the economic theories of this group, because I know they will not succeed if the sober common sense of the people of this country is expressed at the polls and the people who think alike get together. But I am greatly concerned about their disposition toward society at large as we have built it up over a long period of years. The whole disposition of these gentlemen is to tear down and destroy the economic system which has been built up and improved, step by step, and stage by stage, ever since the advent of the Christian era. The underlying theme of their speeches is destruction of things as they are, and-I say this advisedly-they are developing in this country a policy of hate in their attitude towards our established society and all those great national leaders who are to-day guiding the destinies of this country and the allied nations.
Speaking in the city of Hamilton recently, the hon. member for Cape Breton South (Mr. Gillis) is reported to have charged that the workers of Canada had been denied their lawful rights. Have we not all been denied our lawful rights in war-time? Are not our liberties curtailed day in and day out? It is part of the price we pay for victory. The hon. member has no case there. The workers are in the same box with all the rest of us, and they will have to retain that position and forego what is denied to them and to us until the termination of hostilities, when I hope that all their rights will be restored to them.


Thomas Clement (Tommy) Douglas: They have
never had their rights.


Richard Burpee Hanson: Yes, they have had rights. No one has ever denied that they have rights. Then, as reported in the Hamilton Spectator of March 1, the hon. member for Cape Breton South went out of his way to attack Mr. Churchill, the greatest leader Britain and the other free nations have ever had. This is what he is reported to have said:
Churchill hated Hitler and will fight him to the last ditch.
And then:
That's the most I'll say for him.
Then, mark this:
The people will have to get rid of the Churchills to attain their ideals.


Some hon. MEMBERS:: Shame.


Richard Burpee Hanson: If that report is not correct I should like to have the hon. member point out wherein it is not correct. But it has stood in the pages of that newspaper since the first of March and so far as I know it has not been repudiated by him.
I want to ask this question: is that spirit the expression of the true philosophy of labour in Canada? I do not believe it.


Some hon. MEMBERS:: No.


Richard Burpee Hanson: I do not believe it for a moment. Is that the spirit of his party in this house?


Some hon. MEMBERS:: Yes.


Richard Burpee Hanson: Well, it would appear to me to be so. If so, then I say to the hon. member and to the people of Canada that that is the grossest evidence of ingratitude that I have ever known. For Churchill more than anyone else has saved our Christian civilization.
Every time I hear one of these gentlemen speak on post-war problems and with respect to the world that is to be after the war, in this house in this debate and in the debate on the address, especially the speeches of the leader of the socialist party and his two leading lieutenants, the hon. member for Cape Breton South and the hon. member for Vancouver East (Mr. Maclnnis), I am reminded of the declaration of the late member for Winnipeg North Centre, the then leader of the party, who endorsed the statement made in this house on September 9, 1939, on the occasion of the declaration of war, by the hon. member for Rosetown-Biggar (Mr. Coldwell), who stated concretely, as reported in Hansard, page 55:
In view of these considerations, the Cooperative Commonwealth Federation believes that Canada's policy should be based first on the fundamental national interests of the Canadian people, as well as on their interest in the outcome of war.
This is the part to which I draw attention:
Canada should be prepared to defend her own shores, but her assistance overseas should be limited to economic aid and must not include conscription of man-power or the sending of any expeditionary force.
And to this day I have never known of any repudiation of that statement either on the part of the hon. member who made it, his
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The Budget-Mr. Hanson (York-Sunbury)
chief lieutenants in this house, or his advisers in the country, and I challenge him to produce evidence that they do not still hold that view.


Mr. DOUGLAS (Weybum):: That is not correct. There are many statements on the record.


Richard Burpee Hanson: Well, if I were to make an exception of anybody I should be disposed to make it in the case of the hon. member for Weybum (Mr. Douglas).


James Lester Douglas: Oh, that is not necessary.


Richard Burpee Hanson: But I have not yet found any evidence that they have ever repudiated the basic principles laid down in that statement of policy. I know we have had lip-service from these gentlemen.


Mr. REID:: It is a good thing there is Hansard.


Richard Burpee Hanson: Yes, it is a grand thing sometimes that there is a Hansard to check people up. It has a salutary effect. I have found it has had a very chastening effect on my own soul. But I never yet heard that statement of policy and principle repudiated by the socialist party in this country, and so far as I know it never has been, from that day to this.


Thomas Clement (Tommy) Douglas: It has been, several times.


Richard Burpee Hanson: I want to tell the people of Canada-I do not need to tell the membership of this house-beware of these people; beware of this group of citizens who are out to destroy things as they are in this country; beware of these people who are advocating policies to-day which in their considered platform they argued in reverse. I say to the people of Canada that the membership of the Canadian cooperative federation-whatever name you like to call them; a rose by any other name would smell as sweet-by reason of their attitude towards society, by reason of their attitude towards things as they are, by reason of their declaration in respect to the war, are not worthy of the confidence of the Canadian people.


Mr. W. H. GOLDING (Huron-Perth):: Mr. Speaker, I wish to take this opportunity to congratulate the former leader of the official opposition upon his opening remarks respecting the loan which will be launched in the near future. I believe one of the finest things in this time of war is the fact that all parties in the house have cooperated fully in every way in respect of each loan floated, and I was pleased to hear the hon. member speak
for himself and his colleagues in a similar way with respect to the coming loan. May I say further that I was in entire agreement with much of what he said, particularly when he spoke about private enterprise.
May I at the outset of my remarks extend my congratulations to our good friend the Minister of Finance (Mr. Ilsley) upon his presentation of the budget a few days ago. I believe all hon. members realize the minister is carrying a heavy responsibility, a burden perhaps greater than that carried by any former minister of finance in our history. I believe we realize, too, that, as obtains in every country engaged in the war, our whole financial situation is always extremely difficult to handle, and is fraught with serious considerations. I sincerely hope all hon. members will consider these facts, and will take no action or make no statements which might in any way be interpreted as a want of confidence in the minister, or in his management of our financial affairs. In the position he now occupies I believe he is endeavouring to do a good job. I believe, too, that he has endeavoured to distribute taxation fairly and equitably, and it is my personal belief that anyone who would now take any action which might be interpreted as a wTant of confidence in the minister would be taking upon himself a serious responsibility.
All hon. members know that the present situation is created as a result of war and war-time conditions. That reminds us that another year of war has passed, a year in which at times our hopes have been badly shattered, a year in which, at times our hopes have been revived. It has been one in which the faith of all Canadians as well as that of our allies has at times been strained almost to the breaking point, as the tide of battle has ebbed and flowed on our various battle-fronts. However our faith that right will finally prevail has held firm; and while I believe we all realize that the road to an allied victory is still going to be long and costly, events have indicated that victory for the allied forces will finally be achieved.
In the past year, throughout the British empire, the United States and other allied countries people have been forced to do things which they would have had no natural desire to do. We are a peace-loving people. We hate war with all its cruelty, its destruction, its reckless sacrifice of human life, as well as destroying ideals which for decades our leaders have tried to inculcate into the minds of our citizens. It is now about three and a half years since our empire was plunged

The Budget-Mr. Golding
into war, a war for which neither the United Kingdom nor any of the dominions was prepared. As a matter of fact we had all been advocating a policy of peace. It is well known that in our own country we have had a large body of public opinion which seemed to believe that money spent for defence purposes was really wasted. It was contended that no nation in the rvorld had any designs on Canada or any desire to interfere with us in any way. I remember well many speeches made in the house along those lines since I became a member some years ago. Even during the regime of the Right Hon., now Viscount, Bennett these same attacks were made on defence estimates. At that time one hon. member seemed to think it was her particular responsibility to make an annual effort to have even the grant for cadet training cut to one dollar per year. Others of course felt it was their duty to attack larger expenditures.
In 1937 the government did increase estimates for defence purposes, but the records of the house will show the barrage of criticism the then minister of national defence had to face in piloting those estimates through the house. Attacks were made on the method of letting contracts for military supplies, and also made upon those to whom contracts had been let. I believe it is a well known fact that this criticism and this kind of action did much to delay the production of necessary military equipment, all of which went to create a situation in Canada which left ns almost defenceless and with very little military equipment when, eventually, our country was plunged into war. In the face of this serious situation it became the task of our government, under the able leadership of the Prime Minister (Mr. Mackenzie King), to organize all the resources of the dominion in an effort to defend ourselves by assisting our allies in every possible way. The Prime Minister threw himself into the task in a manner which won high praise not only in Canada but from outstanding figures in all allied countries. The task with which the Prime Minister and the government were confronted at that time was enough to discourage any leader; but with typical coolness and clear thinking, always assuming his full share of the responsibility, he set things in motion by assigning to each cabinet post the man he felt was best fitted for the position. And while changes have had to be made through circumstances over which no one had control, nevertheless his selections indicated that in this, as in all other matters, he had given careful thought to the problems he had to decide.
Unfortunately there are some in Canada who seem to get a headache when anybody else gets a headline. Instead of appreciating the many difficult problems confronting the government when war was declared, and instead of giving every possible assistance, they set out to undermine not only the Prime Minister but the government itself. I should like to take a little time to refer to some of the criticisms then carried on-and still carried on, but, thank goodness, to a lesser extent.
Shortly after war was declared it became apparent to the Prime Minister that a determined effort was being put forth to create a want of confidence in the government. He recognized at once that if divisions of that sort were to take place they would spell disaster so far as Canada's war effort was concerned. Therefore the government was practically forced into a war-time election, at the very time when it should have been left free to devote all its time to organizing our nation for the great task to which it had been committed. The Prime Minister, however, accepted the challenge of those who had been asserting that his government had lost the confidence of the people, and referred his case to the court of public opinion. The decision given by the people is now a matter of history; but we cannot easily forget those who took the leading part in that movement to embarrass the government at such a critical time. I would not want to leave the impression, sir, that all who criticized were not honest in their criticism, because I believe there were many who wanted their criticism to be really helpful. But I think history will be much kinder to the Prime Minister and his colleagues than to those who for personal and political reasons took the course they did at a time when those in authority were doing their utmost to steer the ship of state through dangerous waters and to organize the nation for a supreme war effort.
Even after the matter had been referred to the people; even after the government had received a splendid endorsation from the citizens of this country, there were those who continued their bitter personal attacks on the Prime Minister. One is almost driven to the conclusion that these attacks were based on personal political hatred. Then there were attacks of another sort, not bitter, but at the recent Winnipeg convention we had a supposedly lifelong Tory giving an exhibition of his knowledge and veracity when driven to desperation to find something really bad to say about the Prime Minister, but the only bad thing he could think of was that the Prime Minister was the greatest Tory in
The Budget-Mr. Golding

Canada. Well, that is bad enough if true, but mark you, sir, it was said at a Toiy convention.
On another occasion the same hon. gentleman-and I refer to the ex-leader of the official opposition-gave an exhibition of his knowledge of Ontario when, trying to cast a reflection upon and discredit western Ontario, he described it as the "brushwood" country. Well, if it was not that particular leader it is that sort of leadership which I think the Tory party were anxious to get rid of, even if they did have to select another Tory who for twenty years had been able to keep himself in office by pretending he was definitely opposed to all Tory policies. His pretentions worked so successfully for himself that he was able to persuade the whole Tory convention to adopt his stand. I wish to congratulate the convention upon having selected one of the smartest political acrobats who have ever come on the stage of the political life of this country. He is really a past master. Talk about hat tricks, I do not think there is any performer of hat-tricks who can pull fast ones as smartly as this new leader.


Mr. GRAYDON:: Will my hon. friend
allow me to make one interruption?


William Henry Golding: Certainly.


Gordon Graydon: I think my hon. friend
on reflection will not want to continue that sort of diatribe this afternoon. This is war time, and I think the citizen to whom he is referring does not deserve that.


William Henry Golding: most powerful now in use? Is it in our motorized equipment plants, where new records of production have been established, whose products are to be found on every allied fighting front? Is it in our shell plants, where the method of punching the bore of the shell was conceived and adopted, which method has brought about a tremendous saving in the man-hour and dollar cost? Is it in our tank plants, which received such high praise from all allied military leaders? Is it in our lumbering industry, which has been strained almost to the breaking point in an attempt to supply both ourselves and our allies? Is it in agriculture, where men and women, young boys and young girls are doing their utmost under adverse conditions to keep producing food for our own country and our allies? There are men and women on the farms to-day who have passed the age when they should be called upon to do what they are attempting to do now; but be it said to their credit that they have taken up their tools again and are doing their best day by day to assist in beating an enemy who they know would dominate their lives and the lives of their children if we should lose this conflict. Is it in our medical services or our nursing services that we are doing only half a job? Has the finance department of this country failed, or have the people failed to meet the tremendous demands that have been made upon them by the Minister of Finance (Mr. Usley) in connection with the enormous amounts of money which must be raised in order to carry on this war?
I believe these are legitimate questions. It would be interesting to know in what department we have failed so dismally as to be doing only a fifty per cent job. I agree entirely with those who contend that we should never reach the point where we are perfectly satisfied with our contribution. While we have almost performed miracles in organizing the resources of this dominion, I think every member of the government will agree that we have not reached perfection. Mistakes have been made, and there is yet much to be done. I believe every member of the government will also agree when I say that this government has received splendid assistance from the great mass of the Canadian people, in all walks of life, and that if it had not been for their fine contribution Canada never could have put forth such a magnificent effort.
There is no doubt that our man-power problem is serious; we all realize that. That is so in every country involved in this war, I do not care what country you name or what sort of policy it has adopted. Sometimes we
are told by our critical friends that if we had just adopted a certain policy we would not have a man-power problem. I do not know of any country, I do not care what policy it may have, at present engaged in this war which is not faced with a man-power problem. I have been bewildered at times when I hear members with one breath say that we must have more men for the army, the air force and the navy and then with the next breath denounce the government for taking men off the farms, away from lumbering operations and out of industry. I cannot follow that kind of argument.
My opinion is that this country should not be expected to contribute to the armed forces the same percentage of its population as some other countries are contributing to their armed forces. Our potential agricultural and basic production is much greater per capita than that of any other nation. I am afraid that if we contribute the same percentage of our population to the armed forces as has been contributed by some other nations, it will mean that thousands of farms will have to be abandoned. I have not heard anyone in Canada or in any of the allied countries advocating a policy of that sort.
The selective service board under the able leadership of the Minister of Labour (Mr. Mitchell) has a real problem on its hands. I am afraid it will have to perform miracles if it is to meet the demands that will be made upon it. In any event strict attention will have to be given to and diligent and exhaustive research made of the essential requirements if the selective service board is to be successful in making a scientific and practical distribution of our man-power. It is not an easy task that has been assigned to the Minister of Labour, and I think any hon. member put in his place would realize that within twenty-four hours. The minister has my sincere sympathy.
This job will not be done by running away from it. It is not the chap who runs away from a battle who is recognized as the hero. I represent an agricultural constituency, and I know the situation in which our people find themselves. For many years our farmers have had a tough time with the price of their products at a point below their cost of production. The result was that the young men left the farm as soon as they could find employment elsewhere. There are hundreds of 100-acre farms where the son of the family must bear most of the burden because the father, on account of either age or physical condition, is not able to do a great deal. As

The Budget-Mr. Kuhl
a rule this young man must do the marketing of the products, put in the seed, harvest the hay and grain, put in the fall wheat, attend to the threshing, harvesting the fall crops, the fall ploughing and getting in a supply of fuel for the winter. That is a real man's job. If the young man, is taken off a farm like that, the father cannot be expected to give the production the farm should give. The same can be said of 200, 300 or 400-acre farms, although these need a greater amount of manpower. If we are to expect these farms to supply all the beef, pork, cheese, vegetables, fruits and everything else, we must not take away the producers. As I said before, my opinion is that Canada will not make her greatest contribution to the allied cause if these farm lads are taken off the farm, leaving many of our farms idle or partly idle.
It is all very well to talk about sending inexperienced help to aid our farmers; but speaking as one who has had practical experience in farm work, I know it is absolutely essential to have on every farm someone who is able to give a lead in the work, someone who has a thorough knowledge of the production, care and feeding of live stock; someone who has knowledge of the soil and its adaptability for producing certain crops. Such a man needs to be a mechanic, a business man and a bookkeeper all combined. Mechanized farm equipment must have careful attention if excessive repair bills are to be avoided, and that attention can be given only by operators who are familiar with their machines. It takes time and instruction to obtain this knowledge.
I am quite sure that the selective service board will take all these matters into consideration. I congratulate the government upon having placed upon the statute books legislation which provides that bona fide farm lads will be left on the farm. I wish to take this opportunity to make an appeal to the selective service board, the government and the price control board to give careful consideration to the problems which bur agriculturists have to face. I am perfectly satisfied that if they will do that they will be well repaid.
I believe that every member of this house and every citizen throughout the country were well satisfied when the price control board was established. There is far too much unnecessary sniping at these men who no doubt are trying to do an honest and conscientious job. I feel sure that if some of us were put in their positions we would soon have a different viewpoint. No doubt mistakes have been made; but I do not think
these attacks should be made in a way to create want of confidence in the board, in its set-up and in its intended purpose. After all, I believe it is one of the finest things the government has done, and it has been praised and copied in many other allied countries.
In closing, I ask that we give some consideration to our Prime Minister who is carrying a tremendous burden of responsibility, to our cabinet ministers and to those men on the various boards who are trying to do what I believe is an honest job.


Mr. W. F. KUHL (Jasper-Edson):: Mr. Speaker, I was glad to observe that the hon. member (Mr. Golding), in endeavouring to give credit where credit is due with regard to the war effort was ready to give the people of Canada at least a little credit instead of attributing it all to the Liberal party. Before making the remarks which I propose to make relative to the budget, I should like to take issue with a few of the statements which have been made by hon. members during this debate with respect.'to the policies of the group with which I am associated. As one who believes more firmly than ever in the policies and the philosophy of the Social Credit proposals, I have absolutely no objection to anyone offering criticism with regard to the genuine proposals that we are making. But that is not what is done by most of the members of this house as well as by many people outside the house. A great number of them set up a straw man and call it Social Credit. They then knock the silly nonsense down on the pretence that they are destroying the Social Credit argument. They have neither the courage nor the ability to come to grips with the real issue involved.
The hon. member for Moose Jaw (Mr. Ross) yesterday made a statement about which I should like to say a few words. During the course of his address he said:
My hon. friends of the Social Credit group would wreck the whole thing by issuing worthless paper money.
That statement is quite similar to one which the hon. member for Rosetown-Biggar (Mr. Coldwell) made in his address. He said:
It seems to me that my hon. friends to my left mistake money for wealth. In other words, they mistake the shadow for the substance.
Those two statements are, I think, on all fours. The obvious implication of both of them is that the Social Credit proposals suggest the issuance of money without any relation whatsoever to wealth. I want to say for the benefit of the hon. member for Moose Jaw, if he is capable of absorbing the

The Budget-Mr. Kuhl
point, that every single, solitary dollar that goes into circulation in a Social Credit economy represents one dollar's worth of wealth- call it goods or anything else you wish. The money which would go into circulation in a Social Credit economy would be no more worthless printing-press money than the $790,000,000 of money which the government obtained from the chartered banks during the course of the last fiscal year.
May I say again for the benefit of those who have set up these straw men that social crediters do not mistake money for wealth, neither do they mistake wealth for money, and that is the mistake which the hon. member for Rosetown-Biggar makes, I believe, and the mistake which most of the members of this house outside the Social Credit party make. They state or imply by what they say that wealth is money. They assume that when a thousand dollars worth of goods is produced there is automatically a thousand dollars worth of money somewhere in our economic system to buy those goods; that when the farmer produces a thousand dollars worth of wheat, there is automatically somewhere a thousand dollars of money to buy that wheat; and that when a manufacturer makes an automobile worth one thousand dollars, automatically there is one thousand dollars of money to buy that automobile. We in this group have contended constantly that that is not so, and the facts are there to prove it. Examine the financial statement of any company in the " Canada Year Book," and it is apparent that the national production is always in excess of the national income. That is a point which none of those who has attempted to refute the Social Credit contention has tried to dispute. I personally should like to hear that point debated. No -one yet has admitted the chronic shortage of purchasing power that exists under our economic system.
On the point of worthless money may I suggest this to the hon. member for Moose Jaw and those who think like him. I direct his attention to a remark made by my colleague, the hon. member for Wetaskiwin (Mr. Jaques), when he was speaking. He said that at the present time we, the people of Canada, are paying Hitler dividends to the equivalent of at least forty dollars a month for every man, woman and child in Canada. We are making him an outright gift of that money, and we do not expect anything in return; we do not even wish anything in return. Yet the hon. member for Moose Jaw would insist that the money which is used to give Hitler a dividend is sound money. On the other hand, if we were to use the same
amount of money to give ourselves a dividend to buy our own production and enrich our own lives, the hon. member would call that worth" less paper money. Surely that is the inference from the statement he made yesterday. All I have to say to him is that those who resort to such arguments are being taken less and less seriously each day.


Mr. BLACKMORE:: They are just confusing the issue, not trying to find a solution.


Walter Frederick Kuhl: The hon. member for York-Sunbury (Mr. Hanson) is greatly disturbed and perturbed lest individual initiative and private enterprise be jeopardized. No doubt he is aware that the Social Credit philosophy also stands for private intiative and private enterprise. We do not believe that it is necessary to destroy a principle in order to do away with its abuses, any more than it is necessary to get rid of a motorcar just because the carburettor does not function. The point I wish to make to the hon. member for York-Sunbury as well as to the government is that the financial policies for which they stand will not permit individual initiative and private enterprise to function as they ought to. They remind me very much of a drunkard who tries to cure himself of his evil habit and who tries everything except stopping drinking. Both Liberals and Conservatives wish to preserve individual initiative and private enterprise, but they are pursuing a policy which jeopardizes and tends to destroy the very thing which they are trying to preserve. I suggest that they would be well advised to take time off to study the philosophy and the principles of Social Credit, because I believe them to be the only principles which will preserve individual initiative and private enterprise.
I come now to the budget itself. It is quite obvious that the construction of a war budget involves considerably more work than the preparation of a peace-time budget. I join in the commendation which other hon. members have expressed to the Minister of .Finance (Mr. llsley) for the energy he has displayed in conducting Canada's financial affairs in accordance with the policies in which he believes. I agree with many of the things which he is doing to enable Canada to make a maximum war contribution. Nevertheless there are things which he is doing to which I take objection, and he is leaving undone things which I think he ought to do. I draw a clear distinction between the purpose and object of a peace-time budget as compared with a war-time budget.
{Mr. Kuhl.]

The Budget-Mr. Kuhl
I think it is self-evident that if Canada is to make a maximum war effort, all the nation's production over and above that needed to provide a standard of living sufficient for maximum efficiency should be devoted to the prosecution of the war. If Canada is to do her best, no Canadian should expect to enjoy during the -war any more than a moderate standard of living. Hence I believe that, to the extent to which a war budget brings about the greatest possible equalization of income, it is a good budget; and to the extent that it fails to bring about the greatest possible equalization of income, it is a bad budget. A war budget, or for that matter any budget, which permits discrimination against certain sections of the people in the matter of income is, I consider, unjust and unfair. This budget as well as others have done a great deal to reduce higher incomes, but I believe in certain instances they have failed miserably to raise many of the lower incomes to the place where the people are enabled to make their maximum contribution to the war effort. People simply cannot do their best if they are unable to obtain a wholesome diet, sufficient clothing, adequate housing and health services. A budget which compels part of the population to live on the ragged edge of existence is not a patriotic budget. Canada cannot afford to do less than provide all her people with at least the absolute essentials of life which they require to do their best work.
Those who have paid special attention to the farmers' position with regard to their share of the national income have elaborated extensively the farmers' point of view. Consequently I will make only a passing reference to this subject. It has been pointed out repeatedly that those on the farms constitute a third of the population and yet are receiving only one-sixth of the national income. I consider that a budget, whether for war or peace, which permits a continuation of that disproportion is manifestly unfair and unjust.


Mr. FRASER (Northumberland):: Will the hon. member permit a question? I have one of his "funny money" bills here. How much will he give me for it in national currency?


John Horne Blackmore: How much will you take for it?


William Alexander Fraser: I will take one cent.


John Horne Blackmore: All right; bring it over.


William Alexander Fraser: Sold.


John Horne Blackmore: I will give you two, for good measure.


William Alexander Fraser: Are there any higher bidders?


Thomas Vien: Order.


John Horne Blackmore: I will give you two dollars for it.


William Alexander Fraser: Give me two cents for it.


John Horne Blackmore: I will give you two dollars for it-just to call your bluff.


Walter Frederick Kuhl: I was indicating that a budget which did not provide for a just apportionment of the national income was not fair and just. I was about to make a point which many have suggested, that the reason the farmers are not getting a fair deal is that they are not well enough organized. Personally I cannot see that any section of the population should be obliged to apply pressure upon their elected representatives in order to obtain simple justice. I regard it as the bounden duty of the people's elected representatives to discover and remedy economic injustices. Parliament is the most extensive organization which the people of Canada support, and farmers contribute to the support of this institution as well as do all other people in the community. Consequently I cannot see why they or any other class should be obliged to make a special appeal for justice to their elected representatives. Why should any citizen or group of citizens have to beg and plead and implore the government to deal fairly with them? Why should they be obliged to heave and shove and push their elected representatives into doing things which are nothing more than their duty? I believe that the representatives of the people should be the leaders of the people, that on their own initiative they ought to seek out and solve the problems of the people. It is the duty of governments to do for the people what they are unable to do for themselves. I can see no other reason for the existence of a government. If, through reasons beyond their individual control, the aged or any others in our society, whether farmers, labourers or fishermen, are unable to help themselves, the duty of the government is to intervene and help.
It is apparent from all the statistics which have been put on record that the farmers of Canada are not receiving a compensation commensurate with their contribution to the national wealth. I suggest in all sincerity that this government can guarantee and pay them a dollar and a half a bushel for their wheat. It can do so just as easily as it can pay ninety cents, and without increased taxation or borrowing. The government can also guarantee and pay subsidies to farmers in respect of every product for which they are not getting the cost of production, in order to raise their

The Budget-Mr. Kuhl
incomes to where they ought to be. If the government does anything less, it is not doing its duty.
The same reasoning holds true with regard to pensions for the aged, the blind, and others who are unable to take care of themselves. This government could pay an old age pension of fifty dollars a month just as easily as the present miserable and niggardly pittance of ten to twenty dollars, and-again-without increased taxation or borrowing. Members of parliament ought to hang their heads in shame at the manner in which the aged and the unfortunate in this country are dealt with.


John Horne Blackmore: Non-pensioned war widows, for example.


Walter Frederick Kuhl: If Canada were a desert or semi-desert there might be some excuse for dealing with them in this fashion. But our country is capable of producing not only abundance but superabundance. I say that in dealing with these people the attitude constantly adopted is to beat down their just desserts and to give them just as little as can be got away with. What we ought to do is to err on the side of generosity, rather than the reverse.
Another point in connection with pensions is this: I believe every aged person, not at seventy years but at least at sixty-five should receive his pension automatically, whether he be rich or poor, and without any application. That is part of the cultural and national heritage to which the aged are entitled, simply by reason of their citizenship in this wonderful country. I say, therefore, that although there has been much equalization of income, there are still many in the lower brackets whose incomes should be raised, before we can say there is the greatest possible equality of sacrifice. Just so long as that position obtains, I believe our war effort will be impaired.
There are many of the older generation, registered as unemployables, who would like to contribute each day an hour or a couple of hours of work of some kind, in order to make their contribution to the war effort. But on account of their meagre incomes they are unable to do so. They cannot avail themselves of the necessary health services, with the result that we are losing that much energy which could be directed toward our war effort if those incomes were raised to what they ought to be.
I have some further criticisms respecting the budget, and I believe these apply to a peace-time budget equally as well as to one
brought down in war time. I contend that a budget proper should set forth in financial terms all that has taken place in physical terms. This budget does not do so. A budget proper should be a complete financial reflection of the physical realities of the nation. This budget is not such. A budget proper should not represent the creation of new and additional real wealth as a national liability. This budget does so. A budget proper should represent the production of all new real wealth as a national asset. This budget does not do so. A budget proper should not indicate that a nation is headed for financial bankruptcy, when it has greater real wealth producing powers than ever before in its history. This budget does so.
Both the Minister of Finance and the deputy minister have asserted that the real costs of the war are the men and materials, and that such costs must be borne by the generation fighting the war. I agree entirely with that position. But the point I make is that the minister's confession of faith, and his works, do not harmonize. The budget brought down by the minister is not a reflection of the real facts in his possession. In physical terms the armed forces and workers in munitions factories, the miners, lumbermen, fishermen and bank clerks, and all others, have met all the real costs of the war. On the other hand, the budget is not a reflection of that fact.
When we examine the budget we see that our national debt is to be increased to the extent of about two and a quarter billion dollars. That increase in national debt suggests that the people of Canada are not paying for the war as it is being fought. Speaking in Montreal, as recorded by the Financial Post, the deputy minister of finance, Dr. Clark, made the statement that by no financial sleight-of-hand can we pass on the burden of war to oncoming generations. But is that not exactly what is being done in the budget? The point I make is that either the minister's statements are wrong, or the budget policy is wrong. They cannot both be right, because one is a contradiction of the other. If the minister's statements are correct, then the budget policy is wrong. My personal belief is that the minister's statements are correct, and that the budget policy is wrong.
I contend that war debt is a positively false situation. War debt in a country with the wealth producing power of Canada is pure fiction. Canada has no real war debt. The only reason why the budget indicates that the people of Canada have a war debt arises

The Budget-Mr. Kuhl
from the fact that the government is pursuing an upside-down financial policy. It is a policy which conceals, rather than reveals facts.
I should! like to make some remarks respecting the manner in which bond sales campaigns are conducted. I have several objections to the manner in which these sales are made. I was both shocked and amazed when I heard a statement made by those speaking on behalf of tire workers who took part in the last victory loan campaign. I did not imagine that any responsible individual could make a statement so far from the truth. This is the question I heard asked over the air, one for which I have no doubt the war finance committee is responsible: "How would you like to fight Hitler without leaving your comfortable fireside?" I contend that a statement of that kind is not only false but actually subversive of the war effort. It fosters a false psychology in the minds of our people. It suggests that the purchaser of a bond1 is making a contribution almost equivalent to that made by the soldier, the sailor or the airman in the thick of the fight. It suggests that the purchaser of a bond is rendering a service equivalent to that of the individual who machines a gun barrel. I I object strenuously to that type of propaganda. The only way in which anyone can fight Hitler is by donning battle dress, shouldering a gun and participating in the actual conflict. To suggest that the purchaser of a gilt-edged revenue-bearing asset is making a sacrifice comparable with that of a soldier, sailor or airman is to be guilty of the basest blasphemy.
Another objection I take to the manner in which these campaigns are handled and the things that are said is that the people are led by the propaganda to believe that the government needs this money for the purchase of guns, planes, tanks and ships and other war material. In fact they are led to believe that the actual money produces the weapons. I have here a page from the Financial Post which bears out that point. This is an advertisement which came out during the last victory loan campaign. It says:
What our $750 millions will do.
Build 2,208 ram tanks for the army.
Build 55 corvettes for the navy.
Build 397 Lancasters for Britain.
I say that is giving an entirely false impression of the objects of a loan campaign. The minister has stated again and again that the object of the sale of bonds, war savings certificates and stamps is not primarily to raise money to buy ships and tanks and guns and munitions; that its major purpose, if not
its only purpose, is to curtail civilian spending, to reduce the pressure on the purchase of civilian goods in order that more materials may be directed toward the war. If that is the true position; if that is the real object of the sale of bonds, I suggest to the Minister of Finance that he see to it that no other impression goes abroad among our people.
Another point I should like to make-it has been made already in previous debates by one of my colleagues-is with regard to paying interest on bonds, war savings certificates and stamps. If the primary, if not the only purpose of the sale of these bonds and certificates is to curtail civilian spending, then this money which is involved in their purchase constitutes savings. And I believe that if the people are to be permitted to make savings out of their war earnings they should do so at their own expense. Instead of the government paying the people interest on their savings, the people should be obliged to pay the government a service charge for handling their accounts for them during the war. The -reason why the people expect interest on their bonds and savings certificates is that they have been led to believe that the government needs their money to buy tanks and guns and ships, whereas the fact is that as far as securing the money is concerned, if the government chose and wished to do so, the government could create in one minute sufficient money to run this war for the next hundred years. The extent of the money the government created would be simply a matter of the number of naughts they added to the first digit on the credit side of the ledger. In saying that, I am not implying that ships and tanks and guns can be manufactured overnight, but certainly the procuring of the money is the simplest thing in the world; it is nothing but bookkeeping entries.
Another point I should like to make in regard to taking money from the people in order to curtail civilian spending is that the present method through the sale of bonds, war savings certificates and stamps is extremely wasteful of materials and energy, if the primary purpose is to deprive the people temporarily of their spending power. The printing of those bonds involves skilled workmanship and high-class paper. That work and material is absolutely unnecessary. During these bond campaigns salesmen by the hundreds are spending their time urging the people to invest. This labour could be saved; these people could be far better employed behind a lathe machining gun barrels or something of that kind. That would constitute a real contribution. The same thing applies to
The Budget-Mr. Kuhl

advertising; the tremendous radio and newspaper and other advertising programmes are a waste of time, energy and material.
Another objection I have to the present policy is that because all people are unable to purchase bonds and certificates to the extent they would like, it places the majority of the people of Canada in pawn to about fifteen per cent of the people of Canada. The majority become bond-slaves forever to the few.
So much for my criticisms as to the present methods of taking from the people their surplus purchasing power. Let me now say a few words in connection with the sale of bonds to the chartered banks for the purpose of obtaining money. The objectionable features of the present method of handling bonds are bad enough, but those with regard to bank borrowings are infinitely worse. I would not object so seriously if the banks bought these bonds out of their earnings, but they do not. The $790,000,000 of bonds that were purchased by the chartered banks during the last financial year were purchased with money which they themselves created for themselves at no cost to themselves and without assuming any responsibility. The money which the government raised from the chartered banks to the extent of $790,000,000 last year was brand new money. It was purely bookkeeping entries, but brand new money nevertheless, additional to what was already in existence. My contention i3 that the right and privilege of creating this money is a crown prerogative; it is the highest prerogative that the crown can enjoy, namely, creating the money of the nation. But as a result of government policy, $790,000,000 at least was created last year by private institutions, and the people as a whole placed in pawn to the banking institutions. Mr. Barclay Smith, an Australian writer, in a book entitled "Victory Without Debt" has this to say on that point:
It is infamous beyond words that private banks should have the power to make profits in perpetuity out of creating credit, when the government has full power to create its own monetary requirements without borrowing and taxing.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Mr. G. S. WHITE (Hastings-Peterborough):: Mr. Speaker, I should like to associate myself with the remarks of the hon. member for York-Sunbury (Mr. Hanson) this afternoon with regard to the coming victory loan; and I wish to assure the Minister of Finance
(Mr. Ilsley) that as far as the section of Ontario from which I come is concerned, as in all other campaigns it will raise its share of the loan, just as already it has contributed its share during the current campaign for funds for the Red Cross.
In the debate on Tuesday concerning the fuel situation a great deal was said about the question of man-power, and I should like to bring to the attention of the Minister of Labour (Mr. Mitchell) a matter in that connection which seriously affects eastern Ontario. I wish to quote from an article appearing in the Belleville Intelligencer of March 10, under the heading "Government officials to meet Ontario cheese men in city to discuss present shortage of factory help":
Of 342 cheese factories in Ontario which replied to questionnaires sent out by the eastern, central and western Ontario cheese makers' associations within the past few days, 257 reported that they rvere in need of immediate help if the requested 1943 increased cheese production is to be achieved. ... At a recent meeting, officials of the three associations endorsed a resolution recommending the sending of an official delegation to Ottawa to seek immediate alleviation of the labour problem. ... In all, it was stated, the factories required 309 experienced men immediately if operations, which usually start between April 15 and May 1, are to get away on time.
Belleville is the centre of the cheese industry in eastern Ontario.
Last session I brought to the attention of the then Minister of National War Services, whose department at that time was administering the call up of men for the armed forces, the seriousness of the situation resulting from calling up experienced cheese makers and helpers for military service, but apparently nothing was done, since the divisional registrars continued to call up these men. Only a short time ago a cheese maker in my county came to me in regard to two of his experienced helpers who had been called up for training. With the time approaching for the opening of his factory, which would produce from 150,000 to 175,000 pounds of cheese per annum, he was confronted with the situation that he had no help. As everyone knows, the farmers have been requested to increase to a great extent their cheese production during 1943, and the average farmer has made provision to do so. It seems most unfortunate that at this time of year, when the factories are ready to open, we should find a most serious shortage of these skilled men, and I sincerely trust that the delegation which is to see the minister will be able to discover some way to remedy this situation.

The Budget-Mr. White
In a return brought down in this house on March 15 last, sessional paper No. 139B, there are set out the enlistments in the armed forces up to January 31, 1943. An examination of this report shows clearly the farce of the term "equality of service and sacrifice" as applied across Canada. I should like to place on Hansard the figures showing by military' districts the male population between the ages of nineteen and forty-five, and the number of enlistments:
		Male population 19-45	Enlistments
MiD.	1-London ....	147,800	32,649M.D.	2-Toronto ....	408,700	95,596M.D.	3-Kingston ...	150,000	42,144M.D.	4-Montreal .. .	423,800	50,654M.D.	5-Quebec 	214,300	17,403M.D.	6-Halifax ....	118,200	35,226M.D.	7-Saint John.	80,300	23,220M.D.	10-Winnipeg . .	179,700	37,326M.D.	11-Victoria ....	155,100	35,855M.D.	12-Regina 	177,200	31,602M.D.	13-Calgary ....	160,700	34,983 436,658
An examination of this return will clearly show that there is no equality of service spread evenly across Canada, and will show the heavy load some districts are bearing in comparison with others as far as voluntary enlistments are concerned. In the last issue of "Canada at War", at page 39 under the heading of "man-power" I note the following statement:
Approximately 33 per cent of all male Canadians between the ages of 19 and 45 have enlisted in the armed services.
How much better it would have been to point out that in eight provinces of Canada the enlistments were well over thirty-three per cent, but that in Quebec, the ninth province, they ran somewhere between ten and fifteen per cent. In my opinion this condition can be corrected only by the introduction of a fair and just system of selective military service applied in the same manner and degree to all parts of Canada. On other occasions I have advocated the same policy in the house. I did so as far back as June, 1940. At that time one was almost guilty of treason or liable to be charged under the defence of Canada regulations if he made such a suggestion. Then, as now, it was claimed that the introduction of such a system would destroy national unity, but I for one could never understand why a fair and proper distribution of man-power to be called up for military service across the whole dominion should interfere with or destroy our national unity. The National Resources Mobilization
Act has been a farce from the start. On February 26, 1943, replying to a question asked in the house, the Prime Minister (Mr. Mackenzie King) stated that he had not changed his mind in any way about the amendment to this act passed at the last session, and that before the act could be put into force it would be necessary to come back to this house for a vote of confidence or want of confidence in the government. What a man-power policy to have in the fourth year of the war! What a farce the plebiscite turned out to be. With the zero hour for the invasion of Europe drawing closer every day, we have not as yet adopted a proper man-power policy.
With regard to the matter of reinforcements for our forces overseas I think all members of the house will await with interest the secret session at which I trust the Minister of National Defence (Mr. Ralston) will take us all into his confidence and tell us quite frankly the whole story of our reinforcements for overseas. Dieppe showed casualties of some sixty-seven per cent of those taking part, so that it will be most interesting to hear from the Minister of National Defence the details of the provisions that have been made for providing reinforcements for our troops now in Great Britain.
Yesterday the hon. member for Lake Centre (Mr. Diefenbaker) showed that the army was not receiving the proper number of reinforcements month by month. He based his remarks upon the official return No. 139B, which I now hold in my hand, and other figures contained in the booklet "Canada at War". The Minister of National Defence disputed the correctness of his figures, but he gave no explanation as to how the mistakes had occurred. I should like to point out to the Minister of National Defence that the error mentioned yesterday by the hon. member for Lake Centre is not the only one.
If hon. members will look at page 14 of the January issue of "Canada at War", they will see under the heading "army" that the number of soldiers in the active army in Canada is given as 210,000. Yet this return shows the total number of men by military districts, attested for service anywhere but now serving in Canada, as 149,000 as of January 2, 1943. This is a mere difference of 61,000 men. On the same page of the January issue of "Canada at War" the number of men in the reserve army is shown as 200,000; yet in this return it is stated that the total number of men by military districts who were serving with the reserve army as of December 31, 1942, is
The Budget-Mr. White

106,000. This is another slight difference of only 94,000 men. I assume that in the figure of 106,000, being the total number of men serving in the reserve army, is included the
60.000	to 70,000 men who received training for only one month.
The March issue of "Canada at War", which is just off the press, gives on page 14 the strength of the active army as 430,000; yet yesterday the Minister of National Defence pointed out that, according to the return brought down the strength of the army was 437,203; he gave the enlistments for January, 1943, as 11,631, and for February, 8,927, making a total of 457,761. This is another small difference of 27,761.
I do not suggest that the figures given by the minister are wrong, but it seems peculiar that when the ordinary private member is able to obtain information only from returns such as this and from official government publications such as "Canada at War", he should find these great discrepancies. "Canada at War" is issued by the wartime information board, a department of this government. It is only fair to assume that these officials have access to proper sources of information. Perhaps "Canada at War" is issued only for political propaganda purposes; I do not know. This return shows that up to January 31 of this year the number of men called up under the National Resources Mobilization Act was 114,641. I think I am quite safe in saying that to secure this number of men, at least
900.000	notices would have to be sent out.
An examination of the table of enlistments
on page 22 of the February issue of "Canada at War" shows that the call up of men under the National Resources Mobilization Act is not carried out on a proper percentage basis according to population. Let me take military district No. 1 at London as an example. This district has a population of 147,800, and it has supplied by voluntary enlistments a total of 32,378 men for the army. From this district there were called up under the National Resources Mobilization Act a total of 8,533. Compare these figures with those of military district No. 5 at Quebec, with a male population of 214,300. The increase in population over the other district is 66,500. Military district No. 5 at Quebec supplied 17,492 men for the army, which is considerably less than half the number supplied by military district No. 1 at London. Military district No. 5 has supplied only 8,874 men under the National Resources Mobilization Act. These figures can be compared with those of other districts and the same condition will be found to exist.

I realize that the Minister of National Defence is not responsible in any way for the calling up of these men, but I think the time has come when the Minister of Labour (Mr. Mitchell) should tell this house and the public of Canada the plan or the scheme or the method used in his department in calling up men under the National Resources Mobilization Act. When the appropriation bill was before the house at the last session I attempted to secure from the then Minister of National War Services information as to what plan he operated under, but all that he could say was that the calling up of these men was fairly administered. I submit that the proper answer is to be found in this table put out by the government in the publication "Canada at War", in its February issue, which clearly shows that under the National Resources Mobilization Act far more men were called up from one district than were called up from another.
The time has come for the Minister of Labour to tell us exactly how if, say, 10,000 men are required to be called up in March under the National Resources Mobilization Act, they are allotted according to military districts across Canada. Does he consider calling up according to population, those between the ages of nineteen and forty-five? Does he consider the number of men who already have enlisted voluntarily from certain districts in the army, navy or air force? Or, what plan is it that he follows? I hope that either to-day or very soon the Minister of Labour will make a clear-cut statement to the house so that everybody will know what system is to be followed in the calling up of men under the National Resources Mobilization Act. I repeat, that only by the adoption of a fair and just system of national selective service under which men will be called up in a fair distribution across the whole of this dominion, irrespective of occupation, race, creed or anything else, can we cure the present situation. After all, why should one section of this country supply a far larger number of reinforcements than any other section? To-day eight provinces in Canada are more than doing their fair share, both in voluntary enlistments and in supplying men under the National Resources Mobilization Act. The province of Quebec is far behind the other provinces in the number of men who have enlisted voluntarily and in the number of men called up under the National Resources Mobilization Act. Yet there are men in this house who will talk day after day about equality of sacrifice and equality of service. But if anyone dares to suggest that Quebec lags behind, the old bogey of national unity is trotted out again.

The Budget-Mr. White
Why must the eight other provinces submerge their interests in favour of the province of Quebec?
Press releases show that under the National Resources Mobilization Act the draft dodgers run well into hundreds of thousands; yet, according to the press fewer than three or four hundred of them have been located and prosecuted. Under such a system, how can the people of this country who have sons overseas be expected to be satisfied with or have any confidence in such a half-hearted slipshod method of administering the law of Canada? The Minister of Justice (Mr. St. Laurent) has on various occasions been prompt and alert to act when there have been alleged contraventions of the defence of Canada regulations. Perhaps he might as well devote some of his time to administering in a proper, just and fair manner the regulations under the National Resources Mobilization Act.
A short time ago there appeared in the press of Canada an announcement that high-school students would again be allowed to leave school early in the summer term to engage in farm work and in industries connected with the war effort, and that any such student who worked for thirteen weeks would be granted his standing for the year, subject to the recommendation of his teacher or the principal of the school. I have no quarrel or complaint with that. But I .would point out that on March 8, the Minister of Pensions and National Health (Mr. Mackenzie) issued a statement in which he reviewed the educational qualifications of some 347,900 men in the armed forces. The statement showed that of that number the largest group, 102,892, were those in the junior matriculation class; those who had obtained their junior matriculation numbered 31,64S; and those having their senior matriculation, 1,120. But the strange thing is that young men in the province of Ontario who join the armed forces in their matriculation year are not granted their standing for that year. Surely some plan could be worked out with the provincial educational authorities whereby any boy in his matriculation year who joins the armed forces would be granted his educational standing for that year. Many hon. members will recall what happened at the end of the last war when the boys came home. Hundreds of them who had not obtained their junior or senior matriculation were prevented from going on and undertaking university or other courses.
In the estimates for the present year, under the Department of Pensions and National Health there is an item of $400,000 for pensions to be awarded to widows of deceased soldiers,
such pensions to be awarded on compassionate grounds. I would point out to the minister of pensions that while this is very commendable it merely touches the fringe of the whole question of pensions to widows of soldiers. As hon. members are aware, on the death of a soldier whose disability is fifty per cent or over, his widow continues to receive a pension. But on the death of a soldier having a disability of less than fifty per cent his widow receives no further pension. Take the case of a soldier with a wife, and receiving a monthly pension of $30 a month. Of that amount S20 is the pension awarded to the husband, and $10 is the amount payable because he is a married man. On the death of that soldier his wndow does not continue to receive the S10 that had been paid on her account; she receives absolutely nothing. I suggest to the minister that since his department has recognized the principle that the widow of a soldier with a disability of fifty per cent or more is entitled to pension, surely the same principle should be applied to all soldiers whether their disability is five, forty-five or sixty-five per cent. I sincerely hope the minister will give that suggestion very serious consideration and do something about it.
In conclusion, I wish to refer briefly to some of the remarks made this afternoon by the hon. member for York-Sunbury (Mr. Hanson) in dealing with the declaration made in this house by the present leader of the socialist party at the short session in December, 1939, when the hon. member for Rose town-Biggar (Mr. Coldwell) placed on Hansard the policy of his party. While the member for York-Sunbury was speaking this afternoon he was interrupted by various members of the socialist party who stated that there were several statements on record showing that they had repudiated that stand. But let me point out that during last session, when bill No. 80 was introduced to amend the National Resources Mobilization Act, after a very long debate, when the vote was taken, every member of the socialistic party, for reasons known only to themselves, voted against that bill.


Thomas Clement (Tommy) Douglas: We also moved an amendment calling for complete conscription of everything.


George Stanley White: Just a moment. Does that not clearly indicate that the socialistic party have not changed their views or their stand in any way as enunciated in September, 1939?


Thomas Clement (Tommy) Douglas: It proves
nothing of the sort.


George Stanley White: The hon. member for Weyburn (Mr. Douglas) can speak afterwards. In voting against bill No. 80 and in taking the stand which they did, they showed to everyone
The Budget-Mr. White

in Canada that they were not in favour of supplying reinforcements and everything else necessary to the boys overseas.


James Lester Douglas: Mr. Speaker, I rise to a point of order.


George Stanley White: There is no point of order, Mr. Speaker.


An hon. MEMBER:: It is just a statement of fact.


James Lester Douglas: The hon. member is making a statement which is not at all in accordance with the facts. He states that this group have taken a stand indicating that they are not in favour of sending reinforcements to the men overseas.


George Stanley White: The hon. member is making a speech.


Mr. MACKENZIE (Vancouver Centre):: There is no point of order there.


James Lester Douglas: I contend that the hon. member for Hastings-Peterborough has no right to make such a statement.


Mr. DEPUTY SPEAKER:: It is just a matter of argument. I see no point of order in the contention of the hon. member for Weyburn.


George Stanley White: I repeat that the socialistic party, in taking the stand which they did in the vote on bill No. 80, voted against the sending of men overseas to support the troops there. I have always contended that when this parliament decided to send an expeditionary force overseas there was an obligation not only on every member of this house but on every citizen of Canada that these boys must be supported with all necessary reinforcements, the finest implements of war, and everything else necessary, no matter what the cost might be.
I should also like to associate myself with the remarks made by the hon. member for York-Sunbury when he advocated a policy of private enterprise and personal initiative. It seems to me that only under such a policy is there any hope for our children or for the boys when they return from overseas. The men who serve in this war will have had enough of regulation and regimentation, and will be only too anxious to regulate their own affairs. It is quite true that the controls we have to-day are irritating, but they are absolutely nothing compared with the controls and regimentation to which we would be subject under a socialistic party. Freedom, absolute freedom, is one of the things for
which our boys are fighting to-day. We have in Germany an example of what happens in a socialistic state. There, instead of the state being subject to the will of the people, everyone was absolutely subject to regimentation and dictation by the state. I suggest that under the programme suggested by the socialistic party, whereby they would do away with private enterprise, there would be taken away from the youth of this country one of the biggest assets which youth has, namely, the ambition to succeed, to carve out a career for themselves, the right of each one to earn his own living under his own direction and to retain what he honestly earns and acquires, after the Minister of Finance (Mr. Ilsley) has taken his share. Take away this ambition to succeed and to carve out a career from the youth of this country, and you destroy one of the greatest assets youth has.


Mr. W. J. WARD (Dauphin):: I hope that the hon. member for Hastings-Peterborough will not expect me to follow him in what seems to me was a rather distorted and inconsistent attitude in certain portions of his address. I desire at the outset to commend the Minister of Finance (Mr. Ilsley) for his great industry, loyalty, and devotion to duty. I intend to say very little about the budget, which is probably the greatest operation in the sphere of finance which Canada has ever known, but I am sure the people are grateful for having, in the person of the present minister, a man capable of doing the job. There is one matter in the budget to which I wish to refer, but the statements I intend to make are entirely upon my own responsibility. I refer to the allusions to the farmers and the income tax. The minister and his advisers have honestly, no doubt, attempted to meet the situation of the farmers, not realizing, I am sure, the position they hold in the national economy. The minister stated, as reported at page 849 of Hansard:
It will be difficult to put farmers on a pay-as-we-earn basis because it is so very hard for them to estimate their income in advance. We are proposing to give them as much latitude as possible by simply requiring them to pay two-thirds of their tax any time up to December 31 -on the basis of a rough guess or calculation- and the balance when they file their final return in March of the following year. Higher agricultural incomes have now brought many farmers into the taxable income ranges, and I am glad to know that the Department of National Revenue is making special efforts to assist the farmer in reckoning his income and calculating his tax.

The Budget-Mr. Ward

free. During the last election campaign I opposed conscription. I voiced my opposition throughout my constituency, and said I was doing so on my own responsibility. But had the Prime Minister and the government been in favour of conscription, I would still have been against it. Why? Not that I was against conscription as a principle; but I was irrevocably opposed to the conscription of flesh and blood while at the same time more material things were allowed to be given voluntarily, or when the people felt like doing so. We had an example during the last war, when a flock of millionaires were created out of war profits. I have been told that 138 millionaires were created during the last war, and in one or two of the post-war years. Whether that figure is correct, I cannot say; but we know that enormous profits were made.
We had that example, and the only one we had. Consequently I was opposed to conscription, until I knew something more about what was to be done by the government of Canada. I am now grateful to the government, particularly to the Prime Minister (Mr. Mackenzie King) and the Minister of Finance, for the extent to which they have gone in conscripting wealth. Now that it has reached into the pockets of members of parliament; now that the income tax collector gets $800 or $900 from each of us, the argument is pretty well closed, so far as members are concerned.


James Lester Douglas: May I draw the hon. member's attention to the amendment moved at this session by the Cooperative Commonwealth Federation to the motion for an address in reply at this session, deploring the fact that the government has not conscripted wealth.


William John Ward: "Where ignorance is bliss, 'tis folly to be wise."


James Lester Douglas: That is true.


William John Ward: If from eleven and a half million people the treasury can step up the revenue by nearly two billions of dollars in three years, then I think that is conscripting wealth with a vengeance. I cannot imagine any system of conscription my hon. friend would put into effect, involving the taking over of factories, farms, mines and all the rest, which wovdd leave behind it anything but chaos and liabilities, whereas the system we now have leaves behind it great assets.
I turn now to a statement made by the hon. member for Rosetown-Biggar (Mr. Coldwell), as reported in the press on January 23. This is the report of a broadcast delivered at the time of the steel strike, at which time the hon.
member said that the arbitrary price and wage freezing policy adopted in this country decrees that men employed in that arduous and hazardous occupation should work for a wage that is demonstrably too low. I wonder if the hon. member has ever visited any of those steel mills. I have, on several occasions.


James Lester Douglas: And so has he.


William John Ward: I have been through several of .the larger Canadian steel mills, and so far as arduous labour is concerned-well, yesterday we were talking about cutting wood-a good wood chopper will cut about two cords of wood a day. A man who cuts and piles two cords of cordwood a day does at least four times as much work as any man I saw working in any steel mill I visited. There is no comparison. The work in a steel mill is not arduous; I saw nothing arduous about it. And the hon. member says it is hazardous. I was indeed struck by the perfect lighting of the buildings, and the almost perfect atmosphere of the place.
Then he went on to speak of the wages being low. What were the wages paid in those steel mills where the men were on strike? The payroll average-nothing to do with salaries to foremen or managers-was eighty-one cents an hour. I do not call that low pay. If I could have my wages frozen at eighty-one cents an hour for the rest of my life I should consider I was fairly lucky.
Then he went on to say that war planning and post-war policies were two parts of the same fight for victory, and that we are indeed building the post-war world now by the way in which we organize the war. I want the house to get this, because it shocked me. He said:
What can these men think of a war effort that does not hesitate to spend hundreds of millions of dollars to assist private industry?
He stops there. The hon. member knew just as well as I do that a meaner form of misrepresentation than that statement could not possibly have been made. Does he not know that war is expediency from the very battlefield where a general organizes his army to meet the enemy right back to the uttermost channel of our war effort? Truly the government are helping the industries. What for? To help our war effort. Helping them to build larger plants, to remodel their plants, to put in new machinery and tools and the myriad things that go to make up our war effort. Of course the government have helped, to the extent of hundreds of millions of dollars. But they have not given it to private industry, as the hon. member would have us believe.

The Budget-Mr. Ward
I should now like to come back to this table which I got from the bureau of statistics. One of the first things I did when I came here was to call up the bureau to get the average rate of pay in all the steel mills of Canada including the three where the men were then on strike. I obtained from the bureau the rate of wages paid in those three mills. I expected, of course, to find that the pay there was quite low. But that was not so; it was almost exactly on the level of the mill at Hamilton and the other mills throughout Canada. What is the fact? The average wage is $34.79 a week, or $1,809 a year, which is more than double what the average farmer in Canada receives, and this has been his best year. The shipyards of Canada are paying an average of $38.78 a week or $2,016 a year, which is about two and a half times the income of the average farmer. Aircraft factories are paying $35.50 a week, or $1,846 a year, which is again, more than double that earned by the average farmer.
I pause here to suggest to the hon. member for Rosetown-Biggar and the hon. member for Weyburn that they go out and tell their farmer friends that they have been damning the government because they did not rush to the rescue of a group of striking men who were in receipt of an average of eighty-one cents an hour.


Mr. NOSEWORTHY:: Will the hon. member permit a question? Has he also the average salary paid to the operators and owners?


William John Ward: I will now come to the hon. member for York South. Speaking in the debate here a short time ago, the hon. member said:
There is a second feature of the government's fiscal policy with which we are in disagreement, namely, the level at which the government has found it necessary to freeze wages.
I simply repeat what I have already said; that if I could have my wages frozen at eighty-one cents an hour for the rest of my life I should consider myself secure for life. I think the men in the industrial organizations of Canada are the highest paid, except perhaps for the few in the United States, of any such employees in the world. It is time we recognized the fact that our industrial organizations are doing well by their employees.
I pause here to say that I noticed the other day where Mr. Mosher made a remark that soon the unions would have the employers of Canada under their heel. Well,
for years I talked about banks, mortgage companies, steel trusts and the like as being autocratic organizations that ruled the roost. But these people all had an investment in Canada; they had something to protect, something to guard.


Joseph William Noseworthy: Have not the
workers?


William John Ward: Yes, they have their job to guard, but they do not guard it very well. I think we are just as safe under the heel of some of the steelmakers as we would be under the heel of an organized group of labourers who have no investment in the country. It seems to me we should be very cautious what we do in this regard. Labour unions are going much too far. I say to the government, that had I been the Minister of Labour or the Prime Minister when the steel strike took place, illegal as it was-there was really no difference between that strike and a great system of stealing; it was against the law of the land. The hon. member for Rosetown-Biggar (Mr. Coldwell) and, I suppose, the rest of his followers aided and abetted this illegal act on the part of these strikers. Had I been the government I would have given these men just twenty-four hours to be back on the job, and if they were not back I would have had a uniform there for every man the next morning. I would have said, You will either put on the uniform and go into the army at $1.50 a day the same as the other soldiers, or you will go back to work. There might have been a few heart failures, because men producing steel products, the all-important product in the winning of the war, going on strike in the middle of the war when they were getting eighty-one cents an hour, are too cowardly to fight, to go to war. Of course they are. There would have been a few heart failures and likely deaths. I think the Minister of Labour and the government showed wonderful patience and consideration for these men, and I hope there will be no more strikes during the period of this war.


Thomas Clement (Tommy) Douglas: May I ask the hon. member a question? Did he offer a uniform to the manufacturers of this country in 1939 when they refused to manufacture war materials unless they got more than five per cent profit?


William John Ward: I am not discussing that. I am not a manufacturer; I know nothing about the business, but I did have the privilege of discussing this whole question with a man who I think was perfectly honest. He is the manager of one of the largest concerns in Canada producing munitions of war. I said, "Why did you men refuse to accept war contracts on a
72537-87}
The Budget-Mr. Ward

five per cent basis?" He said, "We would all have been in the poor-house; we could not have lived." I asked why. He replied, "If you knew the government inspectors and the extent to which they reject material, you would understand that by the time they get through, our five per cent would be all gone. We are not making any money even at ten per cent." I am only repeating what this gentleman said; I am not arguing the point, because I do not think it is pertinent to the discussion at the moment. But I think those men who are getting the wages now being paid in the industries of Canada should at least remain on the job until the war is over.
I wras amazed the other day to hear the hon. member for Rosetown-Biggar, the leader of the socialist group, repudiate the idea that he was a socialist or that he had any interest in collective ownership. I thought my hearing was fairly good, but after listening to the speeches that have been delivered by his followers I could hardly credit my ears. However, I thought I remembered a statement made by the hon. gentleman himself not long before which was rather incriminating. I looked it up, and here is what he had to say, as reported at page 1109 of Hansard:
However, the unfortunate factor is that in normal times the main stimulus to economic activity is not defence of the nation or the good of the community, but the making of profit.
We all know that he and his followers did not have a great deal of interest in the good of the community a few years ago, when we were struggling to lay the foundation for a war industry in this country. He continued:
To my mind that motive is wrong, but it is the motive which sets the wheels of industry in motion and keeps them running.
A little later he said:
The interest of the people is sacrificed in such times by non-government intervention-
Well Mr. Speaker that is the kind of government I want; I do not want the government to interfere with me. I want to carry on my farming enterprise according to my own good or bad judgment. He continued: -but that is the price we pay for free enterprise.
Well, Mr. Speaker, there are only two systems, not half a dozen. You must have either collective ownership, which is socialism, or private ownership. He continued:
We take the position that in any proper form of society human needs ought to come first and that the making of profit ought to be a purely secondary consideration. . . .
Let me go back to my own farm and my neighbour's farm. I shall be perfectly frank
and tell my hon. friends that I farm, first, to make a living for myself and my family, second, because I like farming, and, third, for profit, just as every other farmer farms for profit. I thought the late Hon. Norman Rogers put the whole case very well during the last session that brilliant gentleman was with us, when he said, "Yes, as a professor of economics I am socialistically inclined, but as I look around Canada and see the extent to which free enterprise has developed this country, and the progress it has made, I cannot believe that this country would become socialist-minded in less than two hundred years." I think he was about right. My hon. friend can put that in his pipe and smoke it. Let him go back home and think that over.
May I now come to the hon. member for Cape Breton South (Mr. Gillis), and see what he thinks of collective ownership. As reported at page 164 of Hansard he said:
For the past two or three months these newspapers have consistently referred to the Cooperative Commonwealth Federation not as such but as the "socialist party." The socialist party is, of course, a left wing movement, and the Liberal party is a right wing movement, and therefore the Progressive Conservative party is going to get in the centre with a sound and sensible programme for the people of Canada.
He was worrying about that. A little later
on he said:
For at least twenty-five years I have had some knowledge of the different labour parties across Canada, from British Columbia to Nova Scotia.
I imagine he knows more about Ontario now, since I believe he spent most of last summer in this province. He continued-
I know that in 1932 they came to the realization that there was no solution for our problems in the provincial fields, and consequently men and women who were active over that period of time met in Calgary and examined the problem on a national basis and set up a national organization, because our problems are national and not provincial.
That was where the Cooperative Commonwealth Federation, a socialist party, was born. All through the speech there is this talk of socialism. He went on to say yes, that he was a socialist; he made no bones about it. That is the hon. member for Cape Breton South.
I come now to the hon. member for Wey-burn (Mr. Douglas), who said, as reported at page 510 of Hansard:
Therefore we believe that for anyone to talk, as the hon. member for York-Sunbury (Mr. Hanson) did yesterday about social security on
IMr. Ward.]

The Budget-Mr. Ward
the one hand and retaining free enterprise on the other is a contradiction in terms, because rugged individualism has never produced for our generation anything but ragged individuals on the one hand and people wallowing in wealth on the other.
I want to remind the hon. member that the farmers of his own province believe in rugged individualism, and if they are ragged it is because nature has been unkind or because they are unkind to themselves. Then he goes on, and his speech becomes even more interesting. He said:
It is time we realized that to talk glibly-
Imagine the hon. member for Weyburn blaming anyone for talking glibly!
-about "social insurance" and "social security" and the "Beveridge plan" as though these things could be superimposed upon an economic system that has produced poverty on the one hand and plenty on the other-
So that by implication the hon. member says we shall have to do away with private ownership and establish collective ownership before we can bring about these other things. In support of his arguments he quotes a Mr. Ryan of Washington., who in an article published in the United States said:
I do not believe that an economy dominated by the philosophy of "free enterprise" will be able to meet that demand.
Well, I do' not know what that means if it does not mean what it says.
I come now to the hon. member for Winnipeg North Centre (Mr. Knowles). I counted the number of times he used the expressions "common man" and "common people," and found that in one column he had used them ten times. The people to whom he refers, the farmers, the working men, the small merchants and so on, are not, to my mind, the common people. They are the aristocrats of our country, the people upon whom we must all depend, the people who do the work of the country. They are the real people, but he refers to them as the "common people." Perhaps on account of his profession he does not know who are the common people of this country.
To come back to the Cooperative Commonwealth Federation, the hon. member for Rose-town-Biggar said that if we progressed no more rapidly in the next twenty-three years than we have in the last twenty-three years, there will be little hope for the future of the social security plan. I wonder where he has been during the past twenty years? After all, social progress is not just social progress. Tremendous economic progress was made long before my hon. friends were heard of, even
before some of them were bom. As I say, great social progress has been made, and nearly all under Liberal governments.
Do we want to go back to where we were prior to the last war when there was no social legislation on any of the statute books of this country? I do not think hon. members are fair, either to themselves or to Canada, when they talk that way. I do not believe that New Zealand or Great Britain or any other country, Russia included, is any more sincere, any more capable mentally, or any more willing or desirous of making progress than is Canada. We do not have to go clear across the world to New Zealand to find a way of dealing with our social and economic problems. We shall deal with them here just as the people of Canada feel it is propitious to do so, as we feel we are able to do so and when we feel it is the proper time. If the great social security plan now before the committee reaches full fruition, I think Canada will be in a most enviable position as compared with that of most other countries.
It may be that our friends of the socialist group feel rather badly. They may think the Prime Minister (Mr. Mackenzie King) has stolen their thunder. But that is not the case; he is just carrying out the programme which many of us have watched progressing for many years. I will confess something. I came into this house over twenty years ago as an opponent of the Prime Minister. I did not know him, and I came here with some preconceived notions of him. It was not because of anything that happened with anyone else; it was only because of what occurred between the Prime Minister and myself, but the fact is that the longer I have known him, the greater has my confidence in him and my respect for him become. Instead of maligning our own country and our own people and our own government, we would be doing more for ourselves, more for posterity if we got down on our knees and thanked God for having such a government as we have, a government with the understanding and the courage to do the things they are doing.
When the government embarked upon a price ceiling scheme they knew it would be unpopular. But they did it. They had the courage to do it. For whom were they doing it? It was done for the working people of Canada. They are the people who will profit and benefit by the continuity that will follow after the war, the stability we shall have then instead of the terrific distortions that followed the last war. I can remember in the third year of the last war when sugar sold in our town for $26 per 100 pounds. There was never
The Budget-Mr. Ward

any stoppage in the flow of raw sugar from the West Indies to Canada at that time. As there is to-day there were no sugar mills standing idle in those days, as there are at present but sugar went to $26 per 100 pounds. Why? Because of the mad inflation that occurred. But this government has kept the prices of sugar down to near what it was before the war.
What about clothing? During the last war I can remember paying $100 for a suit. I could not afford that, but I had to pay it. I needed a suit. There was no reason for such a price. As there was never a day when the fine soft wool from the south stopped coming to Canada. We had a smaller army to clothe, but the price of clothing went sky-high. Today one can go down to stores on Sparks street and buy a good suit of clothes for $35, the same price as he had to pay before the war. Why? Because we have a government that has had the courage to do the right thing -control prices.
I listened with interest the other day to the hon. member for Qu'Appelle (Mr. Perley). I noticed that he was much more modest than usual, but he still got off the track two or three times. He criticized the government rather severely for not having done something about writing off soldier debts. He was a member of a party in power during five of the worst years agriculture has ever known in the history of Canada. There never was a time when the soldiers were more in need of their accounts being written off or written down, but very little was done during that period. He went on to tell us about his great interest in old age pensions. Old age pensions -were almost hoary headed when he came into this house. They have been in effect in this country since 1926, and I do not know why he should show an interest in something which was in effect for almost ten years before he became a member.


Mr. FREDERIC DORION (Charlevois-Saguenay):: Mr. Speaker, since the beginning of this debate I have taken great interest in the speeches delivered by hon. members. Many of those speeches contained very good suggestions. Although I cannot agree with all that was said by my hon. friends, I have pleasure in mentioning especially the speeches of the leader of the Social Credit party (Mr. Black-more) and the leader of the Cooperative Commonwealth Federation (Mr. Coldwell). Those two speeches contained many constructive suggestions, and I have no doubt that if the ministers would listen to some of the views expressed therein, it would assist
them in the performance of the difficult tasks they have to perform at the present time.
The remarks I intend to make on the budget and on the amendment will not be of the type used by masters of finance; they will be couched in the language of the man on the street. I must say that with a budget of $5,500,000,000 we are far from the moderate effort which was promised us by the leaders of the Liberal party during the 1940 election campaign. I cannot refrain from recalling this. Everybody knows that the government succeeded in obtaining the support of the province of Quebec because our people were told emphatically that, notwithstanding previous engagements, if the government had decided to participate in the war, it was very well understood that the participation would be a moderate one. We who opposed the Liberal party, tried to make the population understand that they were once more being duped, but the declarations of the leaders of the Liberal party were so emphatic that the people thought fit to give them their support. It was, I think, the first time in the history of mankind that a government decided to declare war against another country and at the same time maintained that they would make it just a smooth war. The people of Canada, remembering those engagements, and looking at the present budget, find that this smooth war has turned into a real war.
The second thing that comes to the mind of the man on the street is that this budget disregards too much the situation of the Canadian family. The exemptions provided for families with children are not adequate, especially when we take into consideration the obligations of those who have many children below the age of fourteen. I know that no one will be surprised to learn that in the province of Quebec, especially outside the cities, families of eight or nine children are numerous, and therefore it is in the province of Quebec that the burden will be heavier for the taxpayer. I have here an answer which was given to me in this house on the 15th instant regarding the 1941 census. It shows that families of five or more children, and especially those with seven or more, are found particularly in the province of Quebec. I shall give only a few figures to illustrate my point. They appear at page 1227 of Hansard of March 15 of this year. The table given there shows that there are in the dominion 98,500 families with five children. Of this number 34,340 families are in the province of Quebec. There are 63.240 families with six children, and of this number 25.760 are in the province of Quebec. Other figures show that there are 84,920 families with from seven to
[Mr. Ward.l

The Budget-Mr. Dorion
nine children each, and of this number 43,170 are in the province of Quebec. Then there are 20,890 families with ten or more children and of this number 13,220 are in the province of Quebec. I contend that if our objective is to do our utmost to win the war we must never forget that society in general for the safeguarding of which we are fighting is founded on the smaller society called the family, and if we have to protect the civil society we must of necessity bring our utmost protection to its essential element, namely, the family. I submit this point of view to the government. I believe that it will be necessary to review this part of the budget so as to give better protection to the heads of families. We should not take away from them the necessary means to provide for the raising of their children, and for this purpose they should enjoy a larger exemption from taxation.
The third point I raise is that it appears from the budget that the government does not take the money where it is, and here I cannot emphasize too much the statement of the leader of the Social Credit group when he said in this house, as reported at page 1091 of Hansard of March 9, 1943:
All the property of the people of Canada, particularly of the producers, is being mortgaged to a few Canadians. The bonds are gravitating into the hands of a very,- very few, as all the records tend to show.
Further on he said:
Those individuals are accumulating so many bonds that they will be able to live upon the interest of those bonds. . . . They will become a special class of gentlemen of privilege . . . they will control the laws of this country. They will control government policy. They will also control the banking policy of this country. Therefore, as I said a short time ago, from eighty to eighty-five per cent of all Canadians will become hewers of wood and drawers of water for the remaining fifteen per cent. They will be serfs.
The men who are now overseas . . . will come back here and become members of the serf class almost to a man.
I believe this statement is mostly true, and I do not hesitate to say that a system which brings about such a state of things is not sound.
But there is something more inconceivable. When it is a question of raising men for the war, we do not ask the soldiers, the sailors, and the airmen to lend their lives, at interest, to the country. We ask them to devote their youth and their energies, and even to give their lives to protect our country and our institutions. I cannot understand, and I know the people of this country cannot understand why, when it is a question of raising money, things should be altogether different. I cannot understand why we cannot ask those who
have the money, to give it for the protection of the country and for the safeguarding of their own capital. But instead we ask them to lend it, at interest. So that after the war those few people who already control finance will see their capital increased to a high degree. On the other hand, we shall see the soldiers come back home after having suffered, and many of them crippled, and we shall say to them: You have fought gallantly for your country, but now you will pay for the rest of your life the interest on the capital of those who lent their money to your country, and for the protection of which you have fought so hard.
I would also remind the government that I cannot accept the view of those who at the present time contend that if the government has found the way of raising money to produce so large a quantity of war materials, it will after the war easily find a way to provide the people of this country with the necessary means of living. I cannot accept this statement, and we must be very careful not to depend upon it, because I remember that twenty-five years ago we had a war which everybody remembers. The government at that time also succeeded in finding a way to provide our armies and our people with the necessities of life and the needs of war. Production was raised to a very high degree, and we believed then that the government had found a way to provide the people with the necessities of life after the war. This belief is substantiated by a statement which I find in the Sirois report, volume 1, at page 90, from which I quote:
The success with which the dominion government had organized a peaceful society for combat showed how governments could alter the conditions of economic and social life. If governments could organize so effectively for destruction, they should be able to organize the conditions of the good life for their citizens. Under the pressure of social inequalities which became more and more evident, this changing philosophy of the appropriate sphere of state activity led straight to extensive government intervention in economic life and to the provision and further extension of social services.
However, a few years after the war our country came through the gravest crisis we have ever known. Every one remembers the dark days of the period from 1930 to 1939. If after the last war the government of this country did not succeed in bringing to the people the necessary means of living decently, I cannot attach much importance to the declaration of those who to-day maintain that this war teaches us how to get wiser means of providing for the people in the future the necessary' means of life.
The Budget-Mr. Dorion

I believe the burdens of the war would be and; should be lessened, by preventing gifts or loans to countries much more wealthy than we are. I do not hesitate to declare that I cannot understand how the people of Canada, bearing on their shoulders a heavier burden than any other allied country, can, be called upon to help another country which is doing things like those that have been disclosed not long ago. We find, in the Magazine Digest of February, 1943, at page one, an article condensed from the Banker, of London. This article is entitled "A bank whose money we can do without." It is written by Mr. Paul Einzig, who is at the present time foreign editor of the Financial News and the Banker, in London. It deals with a bank called the Bank of International Settlements. I quote:
From the very first day of the war, private citizens and firms in Britain were ordered to sever all connections with those neutral firms which had been put on the black list because they were controlled by enemy interests. Failure to comply is severely punished. But the Bank of England seems to be an exception. Certain of its directors are allowed, even in 1942, to remain on the board of a bank the share capital of which is held by axis-controlled interests to the extent of seventy-two per cent.
And further on:
It is almost impossible to say whether any axis assets in this country, in the United States of America or in Latin America have escaped being frozen because they were camouflaged as Bank of International Settlements assets. . . .
Further, if we look at the composition of the board, we find that out of sixteen directors, only two are British and two neutral, while the remaining twelve are nationals of axis or axis-controlled countries.
This question was raised in the British House of Commons on October 13, 1942. In commenting on the debate, the article states:
The very situation, with whose description Sir Kingsley Wood sought to make the flesh of M.P.'s creep on October 13: would then arise.
If, as he emphatically claimed, the withdrawal of British directors from the B J.S. would result in substantial advantages for the axis and grave disadvantages for the allies, why doesn't Germany bring about that situation by exercising the powers conferred by the axis control over the majority of voting rights at the shareholders' meeting and on the board of directors?
Instead, the Germans even continue paying interest on their debt to the B.I.S. after having defaulted on so many other financial obligations. Why? Because it obviously suits them to tolerate the neutrality of the B.I.S. and to secure the continued British participation in it, even at the cost of sacrifices.
And the last part I quote is this:
Since Germany is in a position to assume full control but prefers to tolerate British participation and "neutral" control, it would obviously be to her disadvantage, and therefore to the advantage of the united nations, if that
country took the initiative in terminating its relations with the Bank of International Settlements.
The man on the street, the man who works hard to help the war effort of his country, cannot understand such a state of affairs; and I believe the government should give some explanation before asking us to give our money or lend it to a country in which some people are doing business with the enemy. I be- . lieve also that the government does not pay enough attention to the actual needs of our country, and- that it should not withhold expenditures necessary to provide the country with the ordinary means of communication.
Speaking for the constituency which I have the honour to represent, I take it as a duty to advise the government that there are on the north coast of the St. Lawrence many small harbours which will not be utilized any longer if the government does not provide them with the necessary repairs to the wharves or does not undertake the necessary dredging.
I receive every week news from different parts of my constituency, advising me to that effect; and if our fishermen cannot be provided with suitable harbours they will not be able to perform their usual tasks and the country as a whole might be deprived of the results of the work they used to do.
I wish also to draw the attention of the government to the question of transport to and from these new vast industrial areas of Chicoutimi and lake St. John where lately a dam was built at the cost of 865,000,000.
At the present time there is only one railroad linking these industrial areas with the rest of the country. Since it is an old railroad it happens very often that the carrying of war materials is delayed on account of a broken rail or some other defects. The passenger trains have been reduced to three a week although, according to the last census, the population of this area is about 20,000 more than it was a few years ago.
There would be one way to correct this situation, and I think the government should listen very carefully to the following suggestion. It would be the building of a railroad between Murray Bay and Chicoutimi, a distance of about sixty-six miles. This would complete a belt-line from Quebec to Chicoutimi. I know this question has already been studied, and that around 1917 there was a survey showing the possibility of this project, which if it were realized would be of a great help to the war effort of this country in establishing much better means of com-, munication between the war plants of lake St. John district and the rest of the country.

The Budget-Mr. Donion
It would also be of great advantage after the war for the development of this part of the country; and as I said in my speech on the address in reply to the speech from the throne, the government should pay special attention to these works that will be as useful in peace time as they are in war time.
I must add that it would also be fair for the province of Quebec to have this railroad added to those we already have, because, according to the statistics, we find that the province of Quebec is the one in which the proportion of railroads is less than in any other province according to the area and the population.
Therefore I urge the government to consider this project, and I am convinced that they will easily come to the conclusion that it constitutes one of the good suggestions that could be made at the present time.
(Translation) Mr. Speaker, I have tried to state as briefly as possible what the man in the street thinks of the budget now before us.
I must add that even in many industrial and business circles there is a feeling of justified uneasiness about the size of this budget. Thus, the bi-monthly bulletin issued by La Banque Canadienne Nationale, for January and February, 1943, contains the following comments:
An increase in the production of armaments is being contemplated again this year. But labour and raw materials now available in this country are so reduced that any such increase in that field will entail a further lessening of activity in numerous establishments catering to the needs of the civilian population and even in certain basic industries.
And further on:
Despite what has been achieved since the outbreak of war, food production is still inadequate in this country which is called upon to supply various foodstuffs to the armies and the civilian population of Great Britain and other united nations. That is why there is such an insistent demand for more consignments of our meats, eggs, dairy products and various other commodities. Now, Canadian farms, which military service and employment in war industries have deprived of about 250,000 farmers and farm workers since the beginning of 1940, are to-day facing a labour shortage the seriousness of which it would be dangerous to overlook. The restrictions imposed on farm implement factories whose production this year must not exceed 24 per cent of the 1940 figure, will add to the difficulties of the situation.
It is consequently imperative that some way be found of ensuring an adequate production of foodstuffs, since the latter are the most essential war munitions.
It is admitted even by those financial interests that we are now facing a situation which is becoming more and more alarming and it may be wondered what will happen if the war is to last many years longer and whether we shall always succeed in devising ways and means of meeting both our war requirements and the needs of our civilian population.
I wish to take this opportunity to express the feelings of all right-minded Canadians who witness to-day with deep concern the social disruption brought about by the employment of women in industrial plants.
It is not difficult to see that we are now preparing a generation that will suffer untold harm from the fact that women have been so ill-advisedly called upon to assume a share of the hard and tiring work performed in the shops. I do not hesitate to say that no medical specialist can possibly deny that working in a shop, night and day, among noisy machines, cannot but upset the nervous system of a woman and make her an easy prey for every kind of disease, especially tuberculosis.
Archbishops and bishops gave warning throughout the land. Medical societies echoed their uneasiness and all who would see a decent social and economic life maintained in our country are deeply worried by the part which women are taking in industrial activities.
This question is so important that the government should have a serious inquiry undertaken by competent men and themselves take such remedial steps as are necessary to correct the present system.
I feel in duty bound to quote briefly from an article by the Rev. Father Alexandre Dugre, S.J., presenting the best and most substantial argument on the subject:
Following their conscience rather than their interest doctors have denounced the terrible epidemic. I have treated healthy girls, says one, with a build as tall and strong as a man's, who were absolutely ruined after a year and a half, a record. They lived in an oppressive atmosphere and surrounded by a pandemonium of noise. Nervous overstimulation caused stomach and heart disorders.
And further on:
Soldiers will die or return, but women in the army or munitions plants will not quite die and yet they will never recover. They will never be the same. Something within shall have snapped. Woman intended to be a temple must never become a shop.
Still further on I find this:
When directors of the selective service and leaders in this country themselves proclaim that "the housekeeper, a front line trooper on the

The Budget-Mr. Dorion

home front, carries on essential war work" (Mr. Goulet); that "disorganization of the home for the benefit of industry, far from helping the war effort, hampers it, delays it, and endangers our future" (Mrs. Eaton); that "women in the home no less than those in the shop make a direct contribution toward the preservation of that civilization which our enemies would destroy" (Mr. King),-they are right. We ask that action be in keeping with such splendid statements and that our readers cooperate by remaining at home, rendering the really great service which is expected from civilized women.
And finally:
In this war where we count so little, we put up with inconveniences, rationing and sacrifices. We supply the money, we give our sons, our blood. But wre shall not sacrifice our women: it would mean setting ourselves back twenty centuries. That Hitler may be broken, some better means must be found than breaking up our homes by adding to the long roll of martyrs in the shops.
I cannot believe that the government shall not heed the almost desperate appeals coming from our doctors and economists and I trust a thorough study of this question will be undertaken immediately.
There is another matter which I would like to mention. This budget before us is the most formidable assault ever launched upon provincial autonomy.
There will come another opportunity for me to discuss this matter fully, but I wonder if we are not witnessing the application of the projects contained in the Sirois report which, as everyone knows, was rejected at the time of the interprovincial conference which was called to consider it.
Mr. Speaker, before closing my remarks I wish to say that I cannot support the amende ment moved by the leader of the Social Credit group. In fact, while I am in agreement with most of the suggestions contained in this amendment, I do not think it would be proper for the government to control private business factories, farms, and other means of production. If some distinction had been made with regard to these so-called means of production, I might have agreed that the government could control some of them; but they would have to be distinctly described.
I cannot agree either to paragraph (e) of the amendment. I will admit that rationing is necessary, but I contend that it should be more adequately put into force throughout the dominion. If, instead of the words "aggressive and consistent", the word "adequate" had been used, I would have been ready to support it.
I believe, however, the subamendment moved by the leader of the Cooperative Commonwealth Federation reflects the general sentiment of the population of this country, and therefore I am pleased to say that I do not hesitate to support it.


Mr. J. M. TURNER (Springfield):: Mr. Speaker, rising for the first time, and perhaps for the last time while you are in the Chair, may I at the outset offer to you, sir, my hearty and warm congratulations upon the high office you have attained.
Rising to- say a few words regarding the budget so ably presented on the second day of this month, and in the fourth year of the war, I consider it my duty and honour to say I am of opinion we have one of the best and ablest ministers of finance we have ever had. Particularly, sir, do I wish to pay that tribute to our minister on behalf of many groups of people in my constituency, labour organizations and the like, who were so desirous of having a pay-as-you-go income tax plan put into effect. This has been done, and we are all very well pleased.
However, there is one thing I want him to do-and this is all I am going to say about it -namely, to fix up the old age pension and to do it quickly.
I need not remind you, sir, because you have been here many years longer than I have, and I have heard it said many times in this chamber, that the west has asked time and time again for more factories, more industrial plants. I mention it now for this reason, that a committee has recently been set up here to study the problems of rehabilitation and reconstruction. Judging from the personnel of that committee, we shall have a progressive and worthwhile report on the industrial needs and opportunities of western Canada which will be well studied by that committee. I would refer to the Defence Industries Limited plant near Transcona which is in my own riding; I do not want to see this plant closed down or salvaged immediately after the war. The same can be said of many plants all through western Canada. I hope at least to have a chance to obtain for the constituency which I represent some plants for western Canada. In my opinion it would be a shame and a disgrace to see that fine plant, in which two or three thousand men are employed, shut down and those men thrown out of work at the end of the war. I wish to pay tribute to those men for the fine work they are doing in this war effort, because we must remember that they were taken from the villages, the municipalities and the country; that many of them never saw the inside of a plant before,
[Mr. Dorion.)

The Budget-Mr. Turner
and that they are doing a splendid job, and it is my pleasure to pay them this little tribute to-night. When the war is over, these men will have had these years of extra experience and be fully prepared and equipped to carry on in similar capacities after the war. Therefore I urge with all the strength I have that that part of western Canada be kept in mind by the committee and the government. We should like to see that plant turned into a synthetic rubber plant or a plant for the manufacture of synthetic gasoline or plastic products, but certainly not destroyed and all those men turned loose to find other jobs.
I hope this government will not allow any immigration into this country after the war until at least all our returned men are taken care of; they should have first call and preferred jobs.
There is something not quite right in regard to our western industrial set-up when one considers even casually the immense possibilities for industry in the prairie provinces. Consider it only from the point of view of natural resources; look at what we have to offer industries: coal, timber, oil, the natural gas of Alberta in untold quantities, thousands of units of unharnessed electrical power, minerals of all kinds, and in my own constituency that new chromium deposit now in the experimental stage. It is well advanced; I believe 200 tons have been shipped. If this proves successful, I understand this will be the biggest development in recent years in Manitoba. These are only a few of the many things we have to offer. We have two of the best equipped and managed railways in the world to take care of the needs of industry. Behind all that we have great agricultural production in all its branches, capable of supplying a population five or ten times, possibly fifteen times what we have now, with the finest food this world can produce. There is only one answer, more and more factories because, if you get the factories, you get the population.
Speaking in this house on January 29 of last year about conditions on the farms as I saw them in my own constituency, I said, as reported at page 148 of Hansard:
During the harvest period last fall I took a trip through part of my riding, and on one farm I saw a poor old lady, sixty-five years of age, on top of a grain stack, working away there when she should have been at home listening to the radio or at least doing some easier job. On another farm, on the next section, I saw a little girl twelve years of age driving the tractor, while her father operated the power binder behind. He told me that he had tried his best to get help, offering $4 a day. but had not been able to secure it. That little girl should have been out playing. I am sure she must have been tired at night.
7253?- 88}
That problem is now more acute than ever, as a result' of the military call-up policy. There is hardly a day that I do not receive some complaints, particularly from the Tyndall and Melrose sections. I should like to read them to the house but I know the government must, by now, be aware of the situation. Let me, however, put this question to the government: Could you expect a young man who is the only boy at home, with three sisters, his father far from well-he has a doctor's certificate-to have in his mind a good, honest, clean thought about our war effort when he is taken into the army, leaving his sisters at home to look after thirty or forty head of stock when it is forty below zero, when he has been doing nothing but that job ever since he was old enough to drive a team of horses?
The principle that in this war agriculture is considered a major industry, along with munitions plants and the like, has, I think, been admitted on all sides of the house. Then why should not the solution of this farm labour problem be tackled along the same lines as [DOT] in the case of any other war industry? Having said that, I would impress upon the government with all the strength and ability I have the need to remedy this serious situation, and the sooner the better.
In the extract which I have just quoted from my speech of January 29, I referred to the long hours which both young and old and even partly invalided people have to put in and the hardships which they have to suffer on the farms ini Canada in order to keep up our war effort. They will continue to do so until the victorious end; we can depend on that. Therefore I make a suggestion to the government, and it is only a suggestion. It is this, that a part or all of the government's share of the excess profits tax taken since it was first started, on such companies only as use in their manufacture the basic products of the farm, for instance, malting companies, brewers, distillers, milling companies, bread companies, packers, elevator companies, should be held in trust by the government until the war is over and given back to the farmers of Canada, from whose hard toil it originated. This should be done because I believe the farmer is the one and only man who is coming out of this war on the wrong side of the whole show. This money would come at a time when he could use it for replacements, and the payment of debts incurred during the period of the war. It might be regarded as some kind of compensation plan to help these farm people for the long hours put in in all kinds of weather, who shifted from' one line of production to another as requested by the government. It would help the farmer to get
The Budget-Mr. Turner

back to his proper position. It appears to me from a labour point of view that somewhere in that excess profits tax must be found some relief for the farmer. He should have the first call on some of that money after the war.
May I now be permitted to proceed to another subject, a subject I had hoped I would never have to speak on while a member of this house, namely, the restrictions on beer, particularly during a war session when there are so many matters of real importance to discuss. I always understood that this matter had been definitely settled years ago as far as any action by the federal government was necessary. But it seems that "to beer or not to beer" is now the question. I assure you, sir, that whatever I may say on the matter is said for no other reason than that I deem it my public duty as a member of this house, and as a result of the many protests I have received from farmers, industrial workers, business and professional men, municipal officials, and from my own study and observations. This matter is becoming more serious every day and, if allowed to continue much longer, will do great harm to our people.
In the first place, let me say that beer rationing is nothing new here in Canada. It has been in effect for many years, since just after the last war, under provincial government control, by means of the permit system. Years ago, and even to-day, your liquor permit was tonsidered to be your ration book. The people of Canada want to know why beer should be further rationed. Who asked for it? Was it any of the members of the three armed services? I should not expect so. Was it anybody from the war veterans' associations or clubs? I have never heard that. Was it any labour group or any organization affiliated with labour? Not to my knowledge. Was it the Canadian federation of agriculture, or anyone else connected with agriculture? I have never been told that. I am sure it was not any of the provincial governments, because that is their main source of revenue. They might have agreed to it later, but they did not ask for it. It was not asked for by any authoritative body. The truth of the whole matter is that some group of prohibitionists and clergymen, mainly from Ontario, were the instigators of the whole thing. This group was headed by some representatives of the Ontario temperance federation, and they managed to exert enough pressure on our government to bring about this action. As a result, we have the present chaotic condition in the beer business.
Let me take one thing at a time, and let me ask what I think is a fair question. Did that body of men wrho came here to ask the government to take this step tell the government that they would take full responsibility for the result of any action taken along this line? I venture to say they did not. I imagine they were like the handle on the pot; yes, we shall be there, but we shall not be in it. Such prohibitionists are men with one-track minds, and if you examine them very closely you will find that this track is not of standard gauge, but is the old, obsolete narrow gauge. Democracy is slipping a little in this country when a minority group, who have failed in their chosen mission of convincing the multitude by means of religious education, can by government action impose their will upon the majority.
You will notice, Mr. Speaker, that I have used the word "labour" frequently. I have done so because beer is known the world over as the working man's drink, as the poor man's beverage, and in many instances his only form of relaxation. I can speak with some authority on that point. For almost ten years I was a hotel keeper in the industrial section of Winnipeg, right down near the Canadian Pacific tracks. Many of the men who are now working in plants engaged solely in war work told me many times that they had never attended a show or watched a baseball game in their lives, and never would; that their only pleasure and relaxation, the only thing they got out of life, was sitting down in the beer parlour with a few of their friends, drinking a glass of beer, talking politics and condemning the government. This country is at war, and conditions are not normal. They will not be normal for some time, but these prohibitionists have no regard for that. They always were and always will be opportunists who will attack when the time suits them, regardless of the outcome; and truer words were never spoken. The Prime Minister (Mr. Mackenzie King) addressed the nation over the radio on December 16 last in connection with this question of temperance and the war effort. I have a copy of that address in my hand, and nowhere did the Prime Minister tell us who demanded that beer should be rationed. Perhaps he thought we should know. That is why thousands of our people were stunned by the action taken by the government. Naturally they are asking many questions, because they believe this is only a short cut to what happened during the last war, namely, total prohibition. The members of this house and the people of this country know very well what happened as a result of that action.

The Budget-Mr. Turner
Therefore is it any wonder that the advertisement which I hold in my hand was published in all the newspapers in Canada? I will read it into Hansard in order to correct the false propaganda that has been circulated by temperance people:
Some plain talking about the beer shortage
Q. What is the extent of the shortage?
A. The available supply of beer under the new regulation is less than seventy per cent of to-day's demand with the expectation that the demand will become greater as time goes on.
Q. What has caused the shortage?
A. The dominion cabinet by order in council has restricted the quantity of beer which may be sold between November 1, 1942, and October 1, 1943.
Q. Why did the cabinet do it?
A. It is believed that the cabinet did it without careful study and principally to placate the prohibitionists who, by means of a powerful lobby, misrepresented conditions to the Prime Minister.
I agree with that.
In placating that element of society the government was placating the same class of people who years ago did everything they could to prevent Sunday street cars, who more recently have denounced the sending of beer to the very soldiers who, in the blistering heat of North African deserts, were fighting to preserve the liberties of the people back home; and who in their narrow-mindedness have effectively blocked proposals to have our picture theatres opened on Sundays for the benefit of enlisted men on weekend leave, who also even spread the false story-
I will come to this a little later; it is really good.
-that sugar is used in the brewing of beer in Canada.
Q. Was it necessary?
A. Beer has long been regarded the people's drink in the free democratic countries of the world. Canadian consumption has been low in relation to consumption in Great Britain and the United States. In 1942 Canada consumed 100,000,000 imperial gallons, equivalent to 1-3 pints per capita per week. The United States consumed 1,750,000,000 imperial gallons-
They can. really drink it over there.
-equivalent to 2-0 pints per capita per week. Great Britain consumed 700,000,000 imperial gallons, equivalent to 2-3 pints per capita per week. Beer is brewed from Canadian ingredients which are in plentiful supply and not required for the war effort. Canadian beer contains no sugar. Tea, coffee and sugar are transported to Canada by sea and their curtailment has been made necessary only by a shortage of ocean shipping.
Q. What will be the consequences?
A. Many of the evils of the prohibition era will return. Many of our soldiers, sailors, airmen and war workers are already being deprived of the nourishment and relaxation provided by a glass of beer.
Q. What is the remedy?
A. In a democracy a government is the servant of its people. Governments are not infallible and from time to time, acting on
bad advice, make mistakes. Whereas they should be quick to correct such mistakes, experience has shown that they are slow to do so unless the force of overwhelming public opinion makes itself known. The remedy in this case, therefore, is in the hands of the people of Canada, who believe in tolerance and moderation, to take every opportunity to publicly and privately express themselves against the government's too drastic restriction of the sale of beer. Otherwise a fanatical minority will be able to continue to impose its wishes upon the tolerant majority. In the last war (1914-18) the British government cut the production of beer but the indignation of the munition workers was so great that it had to be restored in order to maintain production.
Q. Have we published this advertisement because we face the loss of profits?
A. Emphatically no. This company's profits are not at stake because we are even now heavily into the 100 per cent excess profits tax category and any additional volume would only further wear out our plant without any compensation to our shareholders. We are making the fact known because we sincerely believe that the present shortage of beer is unnecessary and is not in the interests of true temperance, the maintenance of morale, and war production.
Canadian Breweries Limited.
In all fairness to the Prime Minister I must admit that one reason he gave for the cut was the labour problem, absenteeism and that sort of thing. Then it was said that an eight-hour day was sufficient for the sale of beer. That step already had been taken in my own province by the liquor control commission, with the full cooperation of the brewers and the hotel keepers. They voluntarily reduced the hours of sale from thirteen to eight; but the chaotic condition in which we find ourselves to-day did not result from the reduction in the hours of sale. It was brought about by the action of the government here in Ottawa. The hotel keepers are unable to get sufficient beer to enable them to keep open for eight hours, and now we have a new national anthem: "To beer or not to beer." The city hotels in particular are trying to operate on a "hit or miss-now you see it; now you don't" schedule because they have not sufficient beer on hand for the eight hours, and some days they do not have any at all. I am quite aware that it will be argued that the cut i3 thirty per cent now in order to get down to a ten per cent cut later on. But by that time the regular flow of business will have been diverted elsewhere. In many instances it has already gone elsewhere, and1 I am informed that this city is no exception.
This does not solve the problem in any way because to-day there is an increasing demand for beer. Can you imagine, sir, the condition we would find ourselves in if we followed the same course with respect to gas rationing? I think that is a good illustration. Can you imagine the chaos there would be if you
The Budget-Mr. Turner

called for gas at three o'clock in the afternoon and were told there was not any? I know the gas stations close at seven o'clock in the evening, but by that time everyone has been able to get the gas he needs. That is only one side of the story.
Here is another side. Look at what is happening to the ordinary citizen of this country who wants beer at home. In Ontario you used to be able to get a permit for twenty-five cents, but no more. It now costs you 82. I do not blame the government if it is in need of revenue; that is bad enough. In Quebec they now charge a non-resident fifty cents, and stamp his registration card on the back. But that is not all. In Alberta I am informed they intend to mark the conviction on the back of a man's national registration card if he is convicted of trying to obtain more than one permit. It is quite conceivable to expect in the very near future that we shall be required to have our photographs and finger-prints taken. Is this the kind of justice for which we are fighting? I do not think that sort of thing belongs with democratic ideas.
Is it any wonder that liquor stores are being robbed and doors and windows smashed, as reported occurred recently in Lethbridge? The remedy is simple. If a labour problem exists that makes it necessary to cut down, for heaven's sake make it eight or nine hours a day, but make sure that the public will be served during those hours. There should be sufficient beer on hand to serve everyone and not have us running around like a bunch of scared jack rabbits from one beer parlour to another. I am sure that if this reasonable request had been made of the provincial governments concerned in the first place, a favourable reply would have been received the next morning.
We are engaged in a world war where there is to be no saw-off to keep steady and cool at all times; we. must keep our feet firmly on the ground. We must expect that our nervous strain and high tension will continue and sometimes be near the cracking point. It will be tougher this year than ever before if I understand the Prime Minister correctly. Therefore, is it not only right, fair and reasonable that the government, as well as all public-minded bodies and groups, should do as little as they possibly can to disturb, interfere, or irritate in any way the day-to-day life of the ordinary common people, who, after all, are the ones who really drink and enjoy their glasses of beer. I think that is a sound statement to make.

The United States are making a magnificent war effort, and there has been no drastic cut in beer there. They drink more per capita than we do. That country remembers only too well the era of gangsters, racketeers and kidnapping through which they passed. Canada was not exempt from the same troubles. Let me state at once that I believe it is partly due to that disastrous period through which this country also passed that we find in this country, where there is an abundance of food, where there is everything to make it the best and healthiest place in the world to live, that in order to get 1,000 men for the services we must call up approximately 2,000 men. I can understand that condition existing when for years thousands of our people were unable to get a clean, wholesome glass of beer, properly served, on account of the actions of a similar group or their forefathers. They were forced to drink vanilla extracts, moon, uppercut, redeye and paint remover. I am surprised that the percentage of rejections is not even greater.
A new industry was then born in Canada. It still continues and probably will continue forever, and from it this government gets no revenue. One cannot forget that terrible episode which happened during the Christmas holiday season in Winnipeg when some fifty or more persons were taken at one time to the general hospital, two or more persons died and the rest just pulled through suffering from the effects of having taken canned heat. These people just pulled through, and we all still remember the stink of Hoffman drops all over the country. These things should be remembered.
My suggestion to the government at this stage is to stay on the beam and leave good enough alone. They should not interfere with the beer business, the working man's drink. Beer is the only alcoholic drink sold on draft for ten cents in Canada, and it can therefore be correctly labelled the working man's drink. The art of brewing is over six thousand years old, and there has never yet been found a substitute for beer. Let us then stop trying, until at least the war is won and victory has been secured.
This government has been criticized and bombed day and night from all altitudes as a result- of the numerous controls it has imposed upon the people. Why should it take on something which was not asked for or which is not necessary? It has been condemned for passing too many orders in council. Here is one, No. 11374, which it should suspend or cancel immediately in so far as it affects

The Budget-Mr. Turner
beer, the working man's drink. You can always trust the working man with his beer. There is no shortage of grain or other materials used in the manufacture of beer, because, after all, it is about ninety per cent water.
Contrary to the belief held by some in Canada, I think it can be argued successfully that there has been no great increase in the per capita consumption of beer. The plain fact is that there are more people drinking beer in Canada than ever before. I believe that is a good sign. If people must drink, it is much better for them to drink beer. In this connection I should like to read an extract from an article written by a doctor of this province, a superintendent of a large institution. It was handed to me just a little while ago, and it reads:
I don't think the government is doing a very good thing by restricting beer so much. The people, especially the working people are resenting it. They will stand for almost any restriction cheerfully if it is necessary but they have the idea in this case that the restriction was put on just because the government allowed itself to be stampeded by a few prohibitionists. There is certainly no shortage of grain in the country and the hard liquor distilleries can look after the alcohol. Strikes me as being one of the best times to really convert this country from hard liquor to beer. I suppose it is true that consumption has gone up in the last few years, but then again many poor devils are able to buy beer now that never were before, and incidentally able to buy bonds and stamps in quantities that they couldn't have touched three years ago.
_ It has been stated by the same group as part of their false propaganda that there is no food value in beer. I have here a letter which was written to the Free Press by Mr. Kensington Downes, a former member of the legislative assembly of Manitoba, and which I think will answer that once and for all. I shall not read it all, but I wish to read the last paragraph, in which Mr. Downes was answering an argument put forth by Doctor Cooper. This paragraph reads:
If, in the opinion of Dr. Cooper, beer is harmful, how does he account for the following? Plight Officer C. P. L. Streatfeld, Squadron Leader A. K. Passmore and Pilot Officer S. G. Turney, of the R.A.F. voyaged from Java to Australia in a twenty-eight foot lifeboat. They and nine companions subsisted for forty-four days on 960 cans of beer (pints) which they found in the lifeboat. They had neither a morsel of food nor a drop of water, yet they are alive and well.
The same outfit to which I have referred has condemned the sale of beer because the oreweries use large quantities of sugar. The fact is that no sugar is used in the manufacture of either beer or ale. Should I remind the government to beware of false witnesses? Perhaps these people are trying to catch a spot on the Fibber McGee programme. I have yet to see a sack of sugar in a brewery. However, I am not surprised at that outfit making that statement because in my opinion they could not tell a bottle of beer from the Empire State building.
How many times has it been said on the floor of this house that our army is the finest and the best equipped in the world? I join with others in that tribute. It has also been stated time and again by members on all sides of the house and by the Prime Minister himself, and with just pride, that our industrial production on all fronts, agriculture, implements of war, shipbuilding and so forth is greater now than at any previous time in our nation's history. How then can it be intelligently argued that beer restrictions were imposed on account of delays, absenteeism, and so forth? The very opposite is true. Under present conditions the worker has almost to take a day off in order to get a glass of beer. The case of the prohibitionists collapses completely in the face of the statement that I have just made.
The magnificent tributes that I have just mentioned as being paid to our armed forees were paid in the first place to our soldiers, sailors and airmen, but also to labour on the railways, for example, to the men who at forty degrees below zero make the railways safe for us to get here; to the skilled workers in the munitions plants; to the farmers and the fishermen; and to all those engaged in working in the mines and forests of our country. These people constitute the very backbone of Canada, and that they have done a magnificent job is admitted by all, including our own Prime Minister and Mr. Winston Churchill. They are by far the largest consumers of beer in Canada. Therefore, why should beer be rationed to them under pressure from a certain group of prohibitionists whose only contribution to the winning of this war, as far as I can judge, is in trying to stir up "internal combustion" in this country?
I have just mentioned that great leader, Mr. Churchill. It reminds me of the remark he made to General Montgomery when he met him in North Africa. He asked General Montgomery how he felt and the general replied, "One hundred per cent fit," and went on to say that he neither drank nor smoked. Churchill replied that he both drank and smoked and felt two hundred per cent fit. I also recall a statement of a man in whom my hon. friend the member for Lake Centre (Mr. Diefenbaker) will be very much interested because he became a famous judge I am told.
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This man said, "Before I have my ale I see things as they are, but after I have my ale I see things as they should be." I see my good friend the hon. member for Weyburn (Mr. Douglas) smiling. I have known him for a number of years.
May I digress at this point to pay a supertribute to the officers and all those who assisted them on the war loan committee, and certainly to every person in Manitoba for their combined efforts in sending that province over the top first in the last victory loan drive.
In conclusion, Mr. Speaker, to keep the record straight and up to date as far as Manitoba is concerned regarding beer rationing, let me say now that in that province we have had four local option contests since the war began, and in all four contests the people voted wet by a majority of two to one. Surely that does not look very much as if they wanted any restrictions on beer there.
At this point may I pay a tribute to the hotel keepers of my province and the trade generally, who through maintaining a high standard of public service were in part responsible for that good majority in those four local option contests.
Why should we in Manitoba be penalized by some false propaganda prohibitionists when the people themselves there have voted as I have already indicated and shown plainly what they want. We rebel and protest against this, and Ottawa will soon know it because Winnipeg has been circulated with cards to be signed and sent here, and this is only the beginning.
Why did not these prohibitionists whose grief, if they had any, was supposed to originate around the Jarvis street section of Toronto, use their own forces in calling for a local option vote or for any number of them, thereby localizing the problem if there was any? But they had different ideas. They wanted to head out for total prohibition with its multiple troubles. They wanted to go for the jack-pot. They wanted to establish total prohibition while the war was on and press the government to use the War Measures Act, and they intended to do it by any kind of sales talk, false or otherwise. In any event they won the first round and the government did pull the main switch, so that to-day we find all Canada, including my own good province of Manitoba, sent hurtling down the hill toward total prohibition where she lay twenty-five years ago and from which she has never recovered fully; her wounds are not yet fully healed. That is the story as I see it.
Finally, Mr. Speaker, having some knowledge of the situation to-day, may I ask the
government before it is too late, and with all the sincerity and strength that I possess, to immediately rescind or cancel order in council No. 11374 in so far as it affects beer, in order to offset the present move toward total prohibition which, in the light of past experience, would not only undermine governments, both provincial and federal, but certainly destroy the morale of our citizens of all classes, who possibly never before in their life broke the law of the land but will certainly rebel against restrictions of this kind, which are not necessary and may unfortunately cause them to become law breakers.


Mr. G. H. CASTLEDEN (Yorkton):: Mr. Speaker, the hon. member (Mr. Turner) who has just taken his seat has just made probably the best delivery he has ever made in this house, but he rather disproved his case since he did it all on water.
Returning to the budget-from the ridiculous to the sublime-one's first impression on looking at the 1943 budget is that it proposes no great changes in our approach to financing Canada in a time of stress. The rates of taxation on incomes, individual and corporation, the excess profit tax and the sales tax remain practically the same. The Minister of Finance (Mr. Ilsley) has adopted some principles of what is known as the Ruml plan, the pay-as-you-earn policy, and as a result those individuals who are paying taxes will find that their tax payments will be increased this year probably fifty per cent over what they paid last year. That is a disturbing consideration, but it is one of the consequences of the partial adoption of the Ruml plan. The minister outlined many of its advantages, but I would point out that there are also a great many disadvantages. In the first place the tax is based on an income which is unknown. Experience has shown that the income of a nation can vary considerably over a twelvemonth period. An accurate estimate of the nation's income is impossible. Second, there are certain classes of income which cannot be taxed at the source. Payments on unregistered bonds and1 certificates, certain collections and note payments, cannot be closely watched unless revenue officers are to be in every office. But when personal income is unknown there is the added difficulty that the rate of taxation cannot be set. Those people whose sole income is salary or wages can be taxed easily at the source. The taxpayer must still make his final return; then the government can set its rate of taxation; then adjustments will have to be made.

The Budget-Mr. Castleden
I would offer this criticism, that the tax structure is becoming much too involved and will need simplification. Also the machinery of collection is far too complicated ; it is leading to the setting up of a bureaucracy. When we remember that we have to pay in 1943 the remainder of the eight months of 1942 tax, in addition to the 1943 taxes, there will be some very severe cuts in family incomes. The worker will have extremely little left with which to purchase consumer goods. The people of Canada are asked to buy bonds, to buy until it hurts: billions of dollars will be required. Before these people will go out and buy bonds they will want to know two or three things. One of the most important is, that the money which the government is spending is being spent profitably, without waste. That is why I think the government would have been well advised to investigate all charges of waste, subterfuge and downright trickery, according to an alleged report a short time ago.


Mr. McNIVEN:: What are they?


George Hugh Castleden: The charges of
Colonel Thompson, I understand.


Thomas Clement (Tommy) Douglas: He has
resigned.


George Hugh Castleden: Another thing of which they should be assured is that what happened to bonds after the last war will not be permitted to happen after the present one. I remember that, upon returning to civil life after the last war, I purchased a few small bonds. In later years, when the depression came and I needed a little money, I went to the bank to sell them. The banker said, "No, we do not buy bonds." I asked, "Where can I sell them? What good are they?" He said he thought he knew where I could sell them. I went round the corner and up a flight of stairs, and there the man ini charge of one of our free enterprise businesses said he would give me about ninety-two cents on the dollar. We should guard against a recurrence of this kind of thing.


Mr. ISNOR:: Those were not Dominion of Canada bonds?


George Hugh Castleden: These were victory
bonds of the last war.


Gordon Benjamin Isnor: And the bank did not take
them?


George Hugh Castleden: No, the bank did not take them.
Canada's expenditures in 1942-43 chargeable to war appropriations will amount, according
to the Minister of Finance, to the grand total of $4,558,000,000. Against that the government expects to raise in the fiscal year $2,218,000,000, leaving a balance to 'be borrowed, in the form of war loans, victory bonds and certificates, et cetera, of over $2,250,000,000. This amount will be added to the national debt, and interest on that debt must be paid. The debt is climbing rapidly. The minister himself estimated the national debt of Canada as of March 31, 1943, at $6,306,779,000. It has doubled since the war began. It has multiplied over twenty times in the last thirty years. The future of Canada is being mortgaged at an alarming rate. The workers, the soldiers, those engaged in war to-day are bearing the brunt of this battle; the great masses of the Canadian people are paying, and paying nobly, the heaviest tax which was ever placed upon the backs of the Canadian people. This year alone we are expected to pay approximately $500,000,000 more than the total cost of the war of 1914-18 and rehabilitation activities after that war; but in spite of that we are paying less than half of this year's expenditure on the war. Truly the world is learning that war is an expensive business, and unfortunately for the masses of the people everywhere war is a Business with a big "B." It is the people who have least to do with, the causing of these wars who must do most of the suffering and the paying.
One fact with regard to money which I think everyone should realize is that, even though spent in war, it is not actually lost. When a shell costing $1,000 is fired into the air it does not mean that with the firing of the shell the money it cost is destroyed. When a $2,000,000 warship sinks in the Atlantic, it does not mean that $2,000,000 worth of cash money goes to the bottom of the sea. It is not entirely lost. Either it is in circulation or stored away in deposits of one kind or another. When we eat food we do not destroy the money which was spent to buy it. In contracting for war equipment, money goes to the contractor, who pays it out in labour, in payments to those who supply him with steel and other materials, and for transportation; he sets aside certain reserves, and he distributes the profits among the shareholders of the company. About $5,500,000,000 was spent last year in Canada. Most of that money is still in the country. Its circulation has resulted in one of the greatest industrial booms Canada has ever known. People's incomes have increased, and in- spite of some of the heaviest taxation ever imposed, industry is still piling up profits. It would be foolish for anyone to deny that
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business is profiting, and profiting largely, out of this war. There are big accumulations of wealth in Canada. Some of them are greater' as a result of the war.
But it ought to be remembered, along with that situation, that many families in Canada now have lost, and in future many more, if this war continues, will lose, fathers, brothers and sons. In view of the sacrifices which are being made of life and limb, nobody dares try to justify the amassing and hoarding of wealth through war. We of this group have continued to advocate that the government should levy non-interest bearing loans against these pools of wealth. If that were done, there would be no need of burdening future generations with a load of debt. If what happened after the last war happens again, in countries burdened with heavy national debts people will be denied a good living in order that they shall pay interest. According to the present set-up interest comes first, before food and clothing, before shoes for the children, before medical treatment for those who need it. In borrowing money, as we have done, to pay interest on our debt, we are doing nothing more than changing ordinary interest into compound interest. That, if it continues, is bound- to pyramid to ultimate and inevitable collapse. It simply cannot continue. There must be some fundamental change in our whole financial set-up. I have heard advocated in the house that we must remember that we owe this debt to ourselves, that we owe it to Canada. We owe it to ourselves, yes, just like the mortgage on the farm. Some group of officials of the Canada Permanent Mortgage Corporation-a-nd "permanent" is a good name- sitting in Toronto, own the mortgage. But we are not any better off on the farm because we owe the mortgage. We still have to go without the necessities of life in order to pay the interest on that mortgage.
Some so-called good Canadians have been reaping the fruits of the labour of the masses. If governments in Canada persist in thinking in these pre-war terms, we are going to fail. To return to an outmoded economy of the thirties will be a return to the bread-lines for the soldiers and sailors, the men- and women who return from the war. We shall have unemployment, want and poverty again.
A great deal was said in this chamber recently about free enterprise. I think the term ought to be clarified. During those disastrous thirties, what was called free enterprise? It was the right of monopolies to carry on their exploitation, the right of people to

form monopolies, the right of people to control complete industries, the right of people to control the credit and currency of the nation. That is what brought the world to chaos and to war. It brought people in Canada to poverty and need, and we sank into almost hopeless poverty.
I would point out to lion, members who are using the terms "free enterprise" and "private initiative" that the distress of the thirties did more to destroy individual initiative among the masses of the people than any other thing I know of.
We in the Cooperative Commonwealth Federation have for our objective the making of a society in Canada which will develop the initiative of the people, bring out the fullest expression of their talents and abilities. Nothing has done more to destroy this process than this so-called free enterprise in Canada. What we mean by free enterprise is the development of that initiative in individuals which has been crushed. What these other people are talking about when they refer to free enterprise is the right to create monopolies, the right to control, the right of privileged groups to have the power to work their will freely on. the Canadian economy. It is quite clear to-day that many groups who have had that privilege in the past are doing their best to see to it that that power and privilege will be maintained in the post-war period. There must be fundamental changes, deep changes. There must be a different outlook.
I do not like to hear people using the term "free enterprise" when they mean almost the opposite. The Cooperative Commonwealth Federation amendment to the budget calls for the nationalization of the whole banking system of Canada.


Gordon Benjamin Isnor: Would the hon. member give his definition of free enterprise?


George Hugh Castleden: The right of the masses of the people, the right of everyone, to develop his own talents, abilities, and initiative. We want to see him have the right to own and develop those things around himself, but without the power to exploit his neighbour.


Donald Alexander McNiven: And does that mean compulsory interest-free loans?


George Hugh Castleden: That is an entirely different matter. We have advocated compulsory interest-free loans under our present system.


Angus MacInnis: Let them define private enterprise; they are advocating it.

The Budget-Mr. Castleden


George Hugh Castleden: The Cooperative Commonwealth Federation amendment calls for the nationalization of banks in Canada. The purpose is, first, to make a more effective war effort now; second, to prevent a large interest bearing debt from being placed upon the people after the war and, third, to lay the foundation for the rebuilding of a new Canadian society.
What have we in the organization of the banks, as we have them to-day? Why can we not leave the banks as they are? If we look over the organization of some of the banks we find some interesting things. We soon find out why it is they wish to maintain control over the currency and credit of the nation. The chartered banks constitute one of the bulwarks through which monopolistic enterprise works. They keep competition out of their own privileged fields, and maintain control.
I should like to place on record to-night the names of some of the companies in which some of the directors of three of our more important banks in Canada act as directors. I shall turn first to the Canadian Bank of Commerce, and I find that one of the directors is president of Dominion Securities Corporation Limited, Brompton Pulp and Paper Company Limited, St. Lawrence Paper Mills Limited, Debentures Securities, Confederation Life, Toronto Mortgage Company, General Shareholding Corporation Limited, and six other finance companies.
Another director is president of Sawyer-Massey Limited, president of Western Canada Flour Mills, and a director of Asbestos Corporation, the Hamilton Bridge Company, St. Lawrence Corporation and Brompton Pulp and Paper Company. This gentleman is also the oil controller of Canada.
Another director is chairman of the largest export company in British Columbia. He is chairman of British Columbia Packers, and is interested in British Columbia Plywoods and at least twelve other companies. He is director of International Nickel Company, of which I shall have more to say later, and a director of Western Trust, British Columbia Power Company, and Forest Investment Company.
Another director is president of Canada Packers and is also a director of British Columbia Packers.
Another director is a director of the Imperial Life Insurance Company, and is vice-president and director of the National Trust Company.
Then, turning to the Bank of Montreal, we find that one of its directors is president of the Royal Trust Company, and a director of the Canada and Dominion Sugar Company.
Another director of the Bank of Montreal was, a year or two ago, president of the Canadian Pacific Railway, Consolidated Mining and Smelting Company, West Kootenay Power Company and Canadian Airways. He was also a director of the Royal Trust Company, the Sun Life Assurance Company, the Royal Exchange, the Waldorf-Astoria hotel, Canadian Industries Limited, and Canadian Investment Fund.
Another director was president of the Cock-shutt Plow Company, and a director of Frost and Wood, Gypsum Lime and Alabastine Canada Limited, Bell Telephone Company, International Nickel Company of Canada, and on the advisory board of the Sun Life Assurance Company.
Another director is president of the Bell Telephone Company and the North American Telegraph Company. He is also a director of Northern Electric, the Royal Trust Company, Mutual Life Assurance Company, Consolidated Paper Corporation, Liverpool and Globe Insurance Company, Globe Indemnity Company and others.
Another director is director of the Mutual Life Assurance Company, the Bell Telephone Company, the Steel Company of Canada, the Royal Trust Company, Dominion Glass, and he, like the hon. member who preceded me, was interested, because he is a director of Borden's Limited and John Labatt Limited, in the beverages people drink, from the cradle to the grave.
Then we come to the Royal Bank of Canada and we find some very interesting directors. One is vice-president and executive manager of the Montreal Trust, director of Canadian Airways, of the Canadian Pacific Railway Company, the Sun Life Assurance Company and Ogilvie Flour Mills.
Another director is chairman of the Dominion Bridge Company, the Dominion Engineering Works, and a director of the Steel Company of Canada, Shawinigan Water and Power Company, Fairchild Aircraft, Montreal Trust, Consumers Cordage, and Canadian Pratt and Whitney Aircraft.
Another director is president of the Northern Electric Company, Amalgamated Electric, Canadian Associated Aircraft Limited; and a director of the Montreal Trust Company, Belding-Corticelli Limited, Lake of the Woods Milling Company, the Bell Telephone Company, Dominion Engineering Works, Dominion Bridge Company, Shawinigan Water and Power Company and others.
Another director of the Royal Bank used to sit with the party to my right in this house.
The Budget-Mr. Castleden

He was also a director of E. B. Eddy Company. He has now, I believe, gone to the House of Lords in England.
Another director was president of the Howard Smith Paper Mills, Canada Paper, Alliance Paper, Allied War Supplies Corporation, director of Montreal Trust Company, Adams Paper and Canadian Chamber of Commerce.
Another director was president and managing director of Dominion Bridge, president of Dominion Engineering Works, vice-president and director of Canadian Car and Foundry Company, director of Bell Telephone Company, Canadian Locomotive, Northern Electric, Montreal Trust, Montreal Light, Heat and Power Consolidated, and, oddly enough, of Beauharnois Light, Heat and Power Company.


Angus MacInnis: All competitors, of course!


George Hugh Castleden: Last but not least I come to one of the directors of the Royal Bank who has rather a long list of companies. He is president of Dominion Steel and Coal, Dominion Coal Company, Halifax Shipyards Limited, Cumberland Railway and Coal Company, Seaboard Power Corporation, Security Fence Company, St. Lawrence Wire Company, Peck Rolling Mills, Dominion Shipping Company, Sydney and Louisburg Railway Company, Graham Nail and Wire Products, Canadian Bridge Company, Canadian Steel Corporation, Essex Terminal Railway, James Pender and Company, and Nova Scotia Steel and Coal Company, and director of, Eastern Car Company, Trenton Steel Works, Acadia Coal Company, Old Sydney Collieries, Canadian Iron Foundries, and Canadian Collieries (Dunsmuir) Limited.


Mr. MARTIN:: Who is that?


George Hugh Castleden: That is Mr. Arthur Cross, if you want his name.


An hon. MEMBER:: Is this all secret information?


George Hugh Castleden: No. It can be found in the directory of directors in the library.


Mr. GILLIS:: It is free enterprise in their own field.


Angus MacInnis: It is a great game.


George Hugh Castleden: These men are the real directors of Canada. That is free enterprise according to your definition.


Gordon Benjamin Isnor: No one gave such a definition.


George Hugh Castleden: Well, they are working very closely with the government.


Gordon Benjamin Isnor: Name one member who has spoken who gave that as a definition.


George Hugh Castleden: You can make your own speech afterwards.


Thomas Clement (Tommy) Douglas: The hon. member wants to keep the present system, does he not? And that is the present system.


Gordon Benjamin Isnor: Name one member who has spoken up to the present time who gave that group as representing private enterprise.


George Hugh Castleden: Those speaking of private enterprise are constantly saying that private enterprise must be maintained in this country. This is what you have under your private enterprise. This is the root cause why the Liberal promises made in the 1919 convention cannot be fulfilled. Two things are seen pretty clearly: one, that the Canadian people will never know economic security, never be free from want and fear until the banks of Canada, the financial system of Canada, can be nationalized. That is why we call for it in this resolution. Two, the supply of new productive equipment to work on the nationalized resources of this country to supply the needs of the people of Canada can never take place under the present set-up, while the present privileged groups control our currency and1 finance and, through that, control the industries. A national banking system with its head at the Bank of Canada would be the proper means of nationalizing the financing of Canada. It then could control the price levels and regulate foreign exchange operations. That is one of the first essentials to social security. It was the first step that the farmer-labour government of New Zealand found necessary before they could institute any real reform within that nation.
I should like to place on record an example of how one of the largest monopolistic corporations of the world receives special considerations from this government. I maintain that this is not warranted when Canada is passing through a crisis such as that of to-day.
In August, 1941, a special agreement was entered into between His Majesty the King in the right of Canada and the International Nickel Company of Canada Limited.
On motion of Mr. Castleden the debate was adjourned.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Passports
Friday, March 19, 1943