Mr. CAHAN:

No, gold is not a merchantable commodity in the sense that iron or steel or wheat is. It was not until after this government came into office in 1935 that an attempt was made to bolster up the trade statistics to show in the official returns an

The Address-Mr. Cahan

increase in our exports to the United States Dy including therein the bars of gold that we were sending to the United States in payment of the international balances accruing out of the deficit in our real trade exports. And in 1936 that real trade deficit in our year's trading with the United States in merchantable commodities amounted to $35,224,564.

For the calendar year 1937, the value of our imports from the United States was $490,504,978, and our domestic exports to the United States, as shown in the official returns, amounted to $470,181,046; but these exports included gold bars to the value of $110,158,903, leaving an export of domestic merchantable commodities of $360,012,143, and showing a real trade deficit for the calendar year 1937, dealing alone with merchantable commodities which un until hon. gentlemen opposite assumed office in 1935 had always been the basis on which these records were kept, of $130,492,835 in our trade with the United States.

For the calendar year 1938 our imports from the United States were of the value of $424,754,993, as shown in the official returns, and our domestic exports to the United States, as given by the Minister of Agriculture in his address on January 25, were $345,911,915, but this included gold bars to the value of $75,450,726, leaving our real export of domestic merchantable commodities at the value of $270,461,189, and showing again a real trade deficit for the calendar year 1938 of $154,293,804 in our trade with the United States.

In brief, during the term of the trade agreement with the United States, which expired on January 1, 1939, our excess of imports of merchantable commodities over, our domestic exports to the United States amounted to $370,742,435, and in part payment of these debit balances we delivered to the United States $258,367,247 in gold bars, which are accepted by every country in payment of international balances. We need no new trade agreement with the United States, we need to make no concessions to the United States to the prejudice of our domestic industry, in order to induce the United States to accept gold bars as a trading proposition. Gold bars are the medium of international payments in all countries in the world, and there is not a country on this side of the Atlantic or the other side that would not be very happy indeed to accept our gold bars in payment of any purchases our traders might make in those countries.

If these facts disclose any commercial advantages which we have received from our former trade agreement with the United States, I think we may all fervently pray

that such advantages may no longer be dispensed to us in the form of debit trade balances for which we have to export our gold.

I repeat that it is only since 1935 that the government of this country has attempted to boost its statistics of export trade by including its export of gold bars as a trading commodity. But no trade agreement is necessary to induce foreign countries to accept bar gold. Gold is not an ordinary commercial commodity which is subject to customs duties, and gold has no place in trade statistics which are quoted to show the advantages of a reciprocal trade agreement between this country and the United States or between this country and any other country.

When, late in 1932 and early in 1933, I was in Paris endeavouring on behalf of Canada to negotiate a new trade agreement with France, the official representatives of the United States used all available tactics, and even intimidation, to preclude the government of France from negotiating any trade treaty with Canada that would even implicitly recognize the right of the United Kingdom and the dominions to grant to each other any trade preferences, basing their objections on the assertion that members of the British commonwealth were, in relation each to the other of them, really foreign nations, and urging that France should insist that the most favoured nation clause should apply to all the concessions we had made to Great Britain; and if hon. members have read that treaty they will notice that in that agreement with France I insisted upon an unusual form of drafting, by including a special use and application of the term "foreign nation" with respect to France.

In fact, from the time that the Ottawa agreements with the United Kingdom and other British dominions were signed at Ottawa on August 20, 1932, the State department of the United States and its representatives at foreign capitals have striven, by every possible means known to United States diplomacy, to weaken, and, if possible, to destroy the effect of those interimperial agreements.

On the day that the new trade treaties were signed, a special dispatch from Washington to the New York Times clearly indicated the official view of the Washington government that the new trade treaty between Great Britain and the United States "sounded the death-knell of the empire preference theory of trade among members of the British empire."

The Times special correspondent further reported :

The Address-Mr. Cahan

It is believed on good authority here that Mr. Hull and his aides refused to consider any exchange of concessions on the basis of a preferential tariff for empire produce, which was considered, in principle, a form of discrimination against American commerce.

On January 25 the Minister of Trade and Commerce assured this house that the "new agreement reaffirms the principle of the British preference, and the United States is admitting that principle." In support of that statement the minister read from the seventeenth article of the new agreement as follows:

Nothing in this agreement-

I call the minister's attention to that.

-shall entitle the United States of America to claim the benefit of any treatment, preference or privilege which may now or hereafter be accorded by Canada to territories under the sovereignty of His Majesty the King.

That stipulation is obviously restricted to the provision that the terms of the treaty shall not entitle the United States to such preferences as may subsist after the treaty goes into effect, and it in no sense affirms the right of Canada to grant such preferences, and leaves the United States still free to condemn such preferences on diplomatic grounds other than the terms expressed in the agreement itself.

Mr. EULER:

Is my hon, friend there expressing his own opinion or reading from somebody else's opinion?

Mr. CAHAN:

No; I gave the citation and read the language, and I am now giving my own opinion with regard to it. It is so clear from a study of the English language incorporated therein that there is, I submit, no other meaning to it.

The Prime Minister's policy of appeasement is already proving insufficient to satiate the cupidity of politicians at Washington, who are now emulating Hitler and Mussolini in their claims for territorial expansion. I have seen an Associated Press dispatch from Washington, dated December 23, more than one month after this new trade treaty was signed, in which Robert B. Reynolds, democratic senator from North Carolina during the past six years, emphatically affirms that-

If Britain wants to prove her friendship for America, she could arrange for the transfer to the United States of a fifty-mile corridor from the United States to Alaska for construction of a super-highway.

A claim even more insolent than Hitler's claim to the Memel corridor or Mussolini's claim to Tunisia! The senator adds:

When American people think of Britain, they think of what Britain owes us and wonder why the debt isn't paid. Let them give us this fifty-mile corridor as part payment.

And then on reflection he adds, as an additional partial payment:

Let them deliver to us Bermuda.

Mr. EULER:

It was not done, though.

Mr. CAHAN:

Oh well, the agitation is still under way. Tunisia is not controlled by Mussolini, nor the Memel corridor by Hitler, but their claims are being urged, with the same persistency being shown as the United States has shown in dealing with this country.

Another Associated Press dispatch from Washington, dated December 8 last, announced that:

The new United States defence program, broadened to embrace the entire western hemisphere, may become a factor in deciding the long-standing controversy over development of the great lakes-St. Lawrence basin.

A war department spokesman said to-day that the huge seaway plan was being studied by the army high command in connection with other national defence matters.

What part the proposed project would have in any defence scheme was not disclosed. President Roosevelt said some time ago that demands for electrical energy by industry located in the St. Lawrence area probably would increase tremendously in time of war. . . .

President Roosevelt indicated a few weeks ago, however, that he intended to press the issue. He announced that he had discussed the new seaway treaty with Premier Mackenzie King when the Canadian Prime Minister was a recent guest at the White House. Mr. Roosevelt said that Mr. King agreed that speedy conclusion of a waterway pact was desirable.

Other political commentators in the United States have also declared that the voluntary assumption by the Washington government of the defence of Canada against foreign aggression would involve control of the navigation of the St. Lawrence river and lake system by the naval and military forces of the United States. Evidently an adequate appeasement of the Washington government will involve radical encroachments upon the autonomy and sovereignty of Canada.

There is no doubt that if the Anglo-American treaty shall serve to increase United States exports to Great Britain, it will also serve in like manner, and probably to the same extent, to restrict Canada's exports to Great Britain. On the other hand, if we may measure the possible advantages to Canada under the new trade treaty by the very meagre increase in our export trade to the United States under the former trade agreement which expired on January 1, then it is a safe conclusion that this new trade treaty will not serve to reduce, to any considerable extent, the widespread unemployment from which Canada now suffers.

Canada's economic condition can be improved only by increasing production in Canada, and thereby increasing the national income which

The Address-Mr. Cahan

is the only source from which distribution can be made for the continuous employment and sustenance of our people.

The product of our gold mines will in every country find a natural market at stable prices, as gold is still the currency of universal acceptance for the payment of international debit balances; but, in the conditions which prevail throughout the world, increased markets can only be found for other primary products, either while the great nations are feverishly preparing for war or when they are - actually engaged in carrying on war.

But the needs of our own people are manifold and ever increasing, and I am convinced that the satisfactory solution of the problem of unemployment in this country will chiefly be found in the rapid development and extension of our secondary industries, which are undoubtedly capable of very great expansion.

If members of this government, instead of conducting for months, and even for years past, futile negotiations with the republic to the south of us, which is now really as protectionist in sentiment as in times past, should devote themselves, for a time, to the development of the secondary industries of this country, unemployment "would rapidly be abated. The time has come for the government to call into conference our leaders in industry, as well as the leaders of labour, to consider and devise ways and means for extending existing secondary industries and establishing such new industries as would have a reasonable prospect of success under stable tariff and stable monetary conditions.

It is futile to extol, in grandiloquent terms, as we are accustomed to do here, our vast latent natural resources, which will doubtless prove to be sources of vast wealth for succeeding generations of men who are sufficiently intelligent and courageous to take adequate measures for their development and for their utilization to supply the increasing needs of our people. Is this present generation of men and women incompetent to devise and establish ways and means for employing in domestic industry those of our people who are employable and who are now unemployed? I do not think so. We have ample funds and credits available for the purpose. But we can never achieve permanent prosperity by annual grants for temporary relief of the indigent, or by ever increasing our excessive national debt by large expenditures upon unproductive public works. That course only serves to hasten this dominion on the way to ultimate economic ruin; but, by increasing the volume of our domestic industry, by giving reasonable

security to both capital and labour, and by establishing reasonable safeguards against the products of the conscripted labour and low living standards of competing foreign countries, we can and should make Canadians the most prosperous and happy people in the world.

If we can assure industry of stable tariff and monetary conditions for a term of five or ten years, industry can safely guarantee the employment of all labour that may be available. It cannot do so when radical tariff changes are so frequently made that industry cannot foresee the fiscal conditions which will confront it and cannot plan its business with confidence six months in advance. Let this parliament ensure such stable fiscal conditions, and let the government forthwith inaugurate a new deal, a beneficent advance, by convening the leaders of labour and the leaders in industry to devise and put into operation adequate measures to ensure the accomplishment of the ends which we all desire to attain.

Mr. R. W. GLADSTONE (Wellington South):

I shall not endeavour to follow in a critical or analytical vein the very fine speech of the hon. member for St. Lawrence-St. George (Mr. Cahan). A gentleman highly trained in the law, he has turned his marked ability today to the discussion of certain phases of our economic and trade problems. My inclinations and training turn me usually to a consideration of the business side of government, but I should like to offer the hon. gentleman my words of tribute and praise for the fine service over many long years which he has rendered in this parliament to the people of Canada.

We have listened to many excellent speeches on the motion to adopt the address in reply to the speech from the throne. We have before us an amendment proposed by the leader of the opposition (Mr. Manion). The amendment adds to the motion one short paragraph, twice containing the words "the government has failed." We have an amendment to the amendment proposed by the hon. member for Winnipeg North Centre (Mr. Woodsworth). This accepts the amendment proposed by the leader of the opposition and adds thereto certain opinions respecting financial institutions and monopolistic enterprises. In his proposed amendment the leader of the Cooperative Commonwealth Federation expresses views with which in part I have much sympathy, but he has tied himself up with the leader of the opposition in a way that precludes me from voting with him on this occasion. The government may not have achieved everything that many of us would wish, but the government has not failed. Despite some distress,

The Address-Mr. Gladstone

where is there a country in the world whose people are so happily situated as the people of Canada? Nevertheless we must press forward to restore in Canada the happier conditions that prevailed before the war. I am confident that these can and will come again under progressive Liberal government. But it must be progressive.

I propose to-day to continue my efforts of previous sessions to bring better business methods into vogue in parliamentary procedure and government administration. On first coming to parliament I made a critical study of the unbusinesslike form of presenting the estimates for the expenditure of public money Last year I offered a resolution calling for a revision of the rules of the house. However, the government considered the rules to be not so bad. But is it not true that we waste time on relatively unimportant matters and do not come to grips in a businesslike way with matters of great national importance? What value to the country is much of the speaking in parliament? There is endless duplication of the same arguments. Many speeches contain valuable suggestions, but on account of lack of organization to develop the ideas into workable form many suggestions do not receive consideration. Political speeches should give way to business deliberations. Some means should be found of doing away with the prevailing type of bickering discussions and enabling us to assemble as earnest-minded Canadians determined to debate matters back and forth without Hansard recording it, exchange views, offer suggestions and arrive at prompt legislative action.

Recently three men visited me-a farmer, a factory foreman, and a merchant. The farmer said:

My father bought a binder for $98 and sold wheat for $1 a bushel. I had to pay $250 for my binder and I sell wheat for 50 cents a bushel. Farmers cannot become purchasers of goods under these conditions.

The factory foreman said:

I know you need adjustments to give you increased purchasing power, but they cannot be made through reducing factory wages.

The merchant said:

The only relief for the two of you is through drastic reduction in the overhead of debt and cost of government. This must come speedily, by fair means or foul, to save the country from bankruptcy and for democracy. The government has done many helpful things, but we must move more rapidly towards new methods for this new era. Meantime the middle class of citizen is disappearing. Soon we shall have only the rich and the poor. Through our system money has gone into bonds rather than into channels requiring labour.

There you have the crux of the situation which frustrates development of our resources 71492-31

and deprives the present generation of work and the rising generation of opportunity to get started on a career. All honour to those who have struggled bravely to keep off relief and maintain their self-respect as true Canadians; but would anyone suggest that the morale of homes can be maintained under such precarious conditions of life? Youth in sheer desperation takes to the road, travels from place to place in search of work. The refusal must be enough to break any brave heart. , Some keep on and on until they become transients. Recently I visited the Ontario reformatory at the meal hour and watched the groups of ten pass to and from the dining hall. There were some seven hundred of them, mere boys, the average age being 19-7 years. Fifty per cent of them are there for first and second offences of petty stealing. They are boys who have not been fitted into some definite work and are without pocket money. Bent on enjoying the pleasures that other boys have, they steal to get pocket money. Would these boys have found their way to the reformatory if they had obtained employment? I say decidedly, no.

Wider markets will help, but we need something further. Crushing overhead, in which the cost of government is a heavy item, is imposed on agriculture and industry alike. These taxes, added to the cost of goods, must be paid by the consumer. High costs of production will shut us out of export markets. Well, what are we going to do about it? If we follow the course of the last session we will talk and talk; it is the system. Is there no way whereby we can meet and discuss the needs of the country with the directness and dispatch of a board of directors in any business? We talk so much about matters of minor importance that there is little time or place for businesslike consideration of the larger issues.

The great railway problem is almost taboo in the house, except when we are called upon to absorb the annual deficit of about $50,000,000 of the Canadian National Railways. Just what is wrong with the system, past and present, of our federal administrative organization? Let me make it clear that my observations and criticisms throughout are intended to apply to all governments over the long past, and not only to the government of the day.

Do we, in the party systems of all parties, permit our organization set-up to approach too much towards dictatorships within democracies? Do we at times, provincially or federally, have leaders who momentarily become so powerful or so idolized that we condone temporarily their autocratic methods? Or do we build our administrative organi-

The Address-Mr. Gladstone

zation on a false economy? Do our efforts to save in small matters result in waste running into millions? We have provincial cabinets of fourteen members in Ontario and fourteen in Quebec. Those provincial ministers have time to clear their desks and give themselves freedom to receive the people and to move about for contacts with conditions and problems.

Until recently the federal cabinet was composed of fifteen members, but now there are sixteen. Federally we overwork some of our ministers until we wreck their health. The ministers have no leisure time to discuss broad issues with private members. In their offices our ministers are always cordial, but pressure of time brings about two-way welcomes,-"Glad to see you come, but more pleased to see you go." I venture to say that private members can mention scores of matters which should be studied, not by royal commissions but by groups of members in conjunction with ministers, and ministers' advisers, in the departments affected. Why not set a few members to work on such matters, choosing men of broad vision, men who are accustomed to dealing with problems from a business standpoint? I shall not take the time here to give more than two or three illustrations of the need for organized study between sessions of conditions which to-day are unsatisfactory. I would place those matters as follows:

1. Radio. I believe the directors of the Canadian Broadcasting Corporation are improving progressively our Canadian programs. It is difficult to suit all tastes, but I have confidence that generally speaking the matter of the preparation of programs is in good hands. I do believe however that the financing and collection methods need an immediate and thorough overhauling. The Minister of Transport can hardly be expected to appreciate the defects of the present system, because his time must be fully taken up in the direction of railway, steamship and aeroplane transport services.

2. Rural -mail couriers. There is the feeling, quite generally held, that the basis of remuneration for these men in the mail service is not satisfactory. It is an old problem, and the new Postmaster General (Mr. Mc-Larty) would be well advised to enlist the cooperation of members or of some other group of men to consider wherein adjustments can be made.

3. Public buildings. The Post Office Department does not pay for the buildings occupied. It does not pay interest on the cost of the buildings. It does not pay for light, heat, water, or janitor services, or anything

IMr. Gladstone.]

else required about the premises. Consequently any announced surplus in the Post Office Department is fictitious. Likewise, the Department of National Revenue, in connection with many of the buildings occupied for customs and excise purposes, does not pay for any of these items. When we are erecting new public buildings for the joint occupation of these two departments, the Ottawa executives of each clamour for space for extravagant present and over-optimistic future needs. I understand the present Minister of Public Works (Mr. Cardin) has endeavoured to curb these demands, but I imagine he has not had an easy time getting cooperation towards economy. There are government offices in Ottawa where one official occupies as much space as the general managers of three or four large industrial organizations I could name. If we listened with our good ear we ought to be able to hear the demand coming from every part of Canada for lowering the cost of government. The protest is not only against the cost of too many members in federal or provincial houses; it is as much and possibly more against the multitude of employees, clerks, stenographers, inspectors, supervisors, technicians and others developing and carrying on practically identical services in many of the centres of government.

Some large business concerns do business in every province. From one head office the board of directors may formulate a general policy, arrange finances, conduct research, prepare general advertising and in the interests of economy and efficiency handle all matters which are more or less matters of common need to all branches. Periodically managers, sales managers, engineers, accountants and officers from the branches meet at head office in convention, as a business parliament, to discuss policies and programs. Have we not in any well-organized dominion-wide business the suggestion and example of a pattern for economic and efficient organization for the government of Canada? Why do not we get at it? Some say it is politics; they say we are politicians and there is nothing complimentary in that remark. We came here as a group of honest, well-intentioned men and women keenly desirous of doing our part for the good of Canada. I am satisfied that not many have lost their zeal to assist with every measure that gives promise of promoting a betterment of conditions.

Somewhere our system is wrong. It lends itself to too much speaking and not enough to businesslike deliberation. This has been true with all governments, regardless of what party was in power. Too much dependence is plac-

The Address-Mr. Esling

ed upon the initiative of the cabinet. Members who are warm supporters of the government on measures of policy know that, according to the rules of the house, an adverse vote on a comparatively minor issue may defeat the government. This rule should be amended to require an affirmative vote on a definite want of confidence motion to defeat any government. Such a change in the rules would promote independence of action on the part of the members.

After all, many of the electors are not worried as to what party is in power or when an election is to be called. Their primaiy interest is in employment and decent living conditions. When we think of unemployment we are apt to look at the Minister of Labour (Mr. Rogers) and criticize him because he has not provided work or pensions or insurance for every person in Canada. The Minister of Labour has to work under great handicaps. There is a limit as to what can possibly be done in his department. Those limiting conditions can be overcome only by the other departments of the government.

How can we rid ourselves of excessive costs in government? How can we speed up the development of our resources by private enterprise reasonably controlled? The Rowell commission is expected to help us answer these questions, but what of the many other important considerations that cannot possibly be touched upon by that commission? Here is where we need group leadership in foresighted planning. Every member should do more forward thinking so that time will not be lost. I say to my fellow Liberals in this parliament, we each have our responsibility, yet the blame for any inactivity on our part falls inevitably upon the shoulders of our leader.

Strengthened organization without the loss of a single day is a crying necessity. That is my recommendation to-day to the Prime Minister and to the government. I want to exonerate myself at once of the charge of selfish ambition. Let them free me of any suspicion of office seeking. My motives have to do solely with the needs of the nation. The distress of the people demands that a new fresh group of say five or seven members be set to work immediately to represent us all in definite forward planning. It matters little whether they be under-secretaries, ministers without portfolio or simply members of an advisory group, so long as they have the opportunity and the ability to think ahead for us along new lines. High qualifications are essential. It may be that the best equipped members from the standpoint of organizing ability may come from two or three provinces only. If that be so, let them be 71492-31J

chosen accordingly, whether they come fronn Prince Edward Island or Quebec or British. Columbia. The situation demands the immediate time and thought of more men of broad outlook.

Mr. W. K. ESLING (Kootenay West):

Mr. Speaker, the people of the federal district of Kootenay West, along with all the people of the Dominion of Canada, have both pride and pleasure in the prospective visit of their majesties. However, there is cause for regret in the fact that the interdepartmental committee could not see its way clear to include in the royal itinerary the southeastern portion of British Columbia. It is felt that their majesties would have pride and pleasure in viewing the largest metallurgical plant in the world. Situated at Trail, this plant operates on the output of the mines at Kimberley, the largest silver-lead-zinc mines on this continent. This plant at Trail is of special interest to the empire at large. At the outbreak of the war there was available a very limited supply of zinc, and this supply was controlled by a New York syndicate which taxed the empire and its allies with exorbitant charges. At that time there was no method of treating the complex silver-lead-zinc ores, but the task of finding such a method was turned over to the research department at the Trail smelter. It was not long before the problem was solved. It is true that this involved a huge expenditure for plant and that there were many initial obstacles to overcome, but the result was a steady supply of zinc at a cost less than twenty-five per cent of what the New York syndicate was charging. A continuous supply of zinc was then available to the empire and its allies.

In this debate on the address it is permissible and even advisable for an hon. member to bring to the attention of the government certain conditions which exist in his district as well as complaints which may affect other portions of Canada. This is done in the hope that the government may consider the amendment of existing legislation or the enactment of new legislation to remedy such complaints. Residence property in the city of Trail is. quite scarce and this makes it necessary that many of the employees of the smelter find' accommodation elsewhere. Many of them have their homes in the rural districts or at Rossland, which is five or six miles up the-mountain. With so many homes located away from the immediate vicinity of the smelter the problem arises of transportation for these employees. It is necessary for the men to be on shift on time, and the men on shift are anxious to get home on time. That problem confronted the employees, as well as the matter of a much reduced transportation

The Address-Mr. Esling

charge. One of the employees, Mr. John Gordon, conceived the idea of a cooperative transportation company. In 1932 fifteen of the employees made a first contribution of five dollars each towards the purchase of a car, and to-day that transportation association is perhaps the most successful cooperative concern in the Dominion of Canada. It carries 441 men to their labours each day and brings them back. The result has been that another similar organization has been established to transport men some ten or twelve miles from the southeast and another to transport men twenty miles from the north to Trail.

These cooperative transportation societies carry members only, and they were of the opinion that they were exempt from income tax. The Minister of National Revenue (Mr. Ilsley) was generous enough to extend the time for payment of penalty and interest until the matter could be looked into. Section 2 of chapter 24 of the Income War Tax Act, 1930, sets forth that cooperative associations of farmers, live stock men, dairymen, poultry-men, fishermen are exempt from income tax, as well as societies of a like nature. I am going to ask the minister if he will not, early this session, consider my suggestion that the Income War Tax Act of 1930 be amended so as to exempt also these transportation cooperatives from the tax.

Under the harbours and piers act, as amended last session, the Minister of Transport was authorized to recommend to the government the appointment of wharfingers, or controllers as they are called, and to collect tolls on all farm products and merchandise passing over public wharves. While that is all very well for the larger wharves, it is certainly an innovation so far as the wharves on the lakes and rivers in the interior of British Columbia are concerned, because there is not a wharf there with a community of many more than a thousand people behind it, and very few with that number. The people using these wharves have had the use of them for as long as forty years in some cases, and they never heard of such a thing as paying tolls to use the wharf. It is true that some ten years ago one wharfinger was appointed, but he lasted only two weeks. Subsequently there was not another until June last, when at a place called Renata on the Columbia river one was appointed. What was the result? The people absolutely refused to pay tolls of any kind; they simply landed their produce on the beach and carried it up over a gangplank.

I cannot conceive of anything which the people of that district are going to oppose more strongly than a proposal that the farmer be required to pay tolls on the little bit of

produce he takes to market, and that the merchant pay tolls on the little bit of merchandise which comes over the wharf in a community where there are no more than from three to five hundred people. These fanners and the people of the district generally have a hard enough time to keep off relief. Most of them manage it by sending a little bit of produce to market, and now they are asked to pay tolls on a side of beef, a case of eggs, or anything else which they take to market and hope to sell. I want to say to the Minister of Transport with all deference that he might just as well try to change the course of the Columbia river as to try to make these people pay wharf tolls. The idea is impractical and simply impossible, and that has been demonstrated by the fact that during the last six months the wharfinger at Renata has been standing there and not one case of produce has gone over the wharf.

Why should these people be asked to pay toll? Are people who use the post office called upon to maintain the post office building except as general taxpayers throughout Canada? The residents living behind these wharves contribute their share of taxes to the consolidated revenue fund, and there is no sense under the sun in attempting to collect fees from them on the farm produce they send over these wharves. As a matter of fact, the majority of people using these wharves are English settlers who were brought to Canada during the boom days when the government was spending three million dollars a year to encourage immigration. Unfortunately the lands have materialy decreased in value since then, and there are not the same opportunities for people to make a comfortable living along those lakes. So I do hope the Minister of Transport will reconsider his inclination in that direction. If he will have some officer or officers of his department visit the Arrow lakes and other lakes in the southeastern section of British Columbia, I am sure that their report will convince him of the injustice and impracticability of appointing wharfingers and attempting to collect fees and tolls from the farmers and residents in that district.

Last session I presented to the house the case of a resident in my district who, on bringing in a radio from the United States, was confronted by solicitors of the radio patent holding company and charged a royalty. He was also served with notice that if he brought in another radio it would be subjected to confiscation and destruction. The question of radio patents has been referred to the tariff board and I am perfectly confident that when it makes its report it will contain very

The Address-Mr. Esling

commendable recommendations upon which this government may act. But the fact remains that the government could have remedied existing conditions long before it ever referred the matter to the tariff board. It could have relieved the people of Canada from the conditions which existed during 1938. When the matter was first presented to the tariff board, evidence was given which showed that the cost of radios in Canada was from fifty to ninety per cent higher than in the United States. The facts are simply these. There are some seventy patents covering the construction of radios. These patents are held by a holding company which is owned and controlled by the eleven or twelve radio manufacturers in Canada. The manufacturers then purchase from the holding company a licence to use their own patents. Of course that money comes back to them, but at the same time it is tacked on to the price of the radio. Then they are in a position to restrict production, and also to regulate prices. I am sure that the tariff board will give this house a very clear description of the existing monopoly. This holding company has not been so keen to prosecute anybody since the subject was referred to the tariff board. It will be seen that for the first six months of this year radios to the value of 8440,000 were brought in under the S100 exemption, and it is fair to assume that, including the Christmas trade of 1938, the total value of such radios will be around a million dollars. My point is that there was a necessity for referring it to the tariff board, but conditions for the people of Canada could have been very much improved had the government itself acted under the authority conferred first of all in the Patent Act, which permits the commissioner of patents to annul a patent where the owner is abusing it. On the other hand the combines act permits the director of combines to annul these patents where they are being used for the purpose of regulating prices or controlling production.

I want to take this opportunity to convince the government that it did not need any further evidence than was placed on Hansard last year. There was placed on Hansard the list of patents, the demand of the solicitors of this holding company for royalty, and a letter from the holding company telling the resident of Nelson to whom I have referred that if he brought in another radio it would be subject to confiscation and destruction. I have it from one than whom there is no keener or better authority in Canada, that under the Patent Act as it exists to-day that holding company has a perfect right to demand the surrender for destruction of any radio

brought in from the United States. Is it not a fair assumption on the part of any citizen that when he purchases a radio, pays the duty on it, clears it and takes it to his home, it is his radio and he is secure in its possession? But certainly that is not so, and surely it is a condition which this government should not tolerate when it has the authority, under the combines act and under the Patent Act, to put an end to such monopolistic tactics.

I am going to take this opportunity to thank hon. members of all parties and groups in the house for their unanimous approval of a bill last session which curtailed the activities of the Canadian Performing Right Society. The bill exempted all music communicated by radio or gramophone from payment of royalties to the Canadian Performing Right Society, on the ground that that music was paid for at the source-in other words, paid for by the broadcasting stations and by the manufacturers of gramophone records. Before His Honour Judge Parker, the royal commissioner, evidence was given by the American director of the Canadian society-and the American society, let it be understood, is the parent of the Canadian society-to the effect that the small users of music which are now exempt, that is to say hotels, skating rinks, stores, lodge halls, and so on, have no commercial value and should not be taxed with royalties. That was the evidence of this director. Apparently they had no commercial value then, yet this same society after the passage of this bill goes to the government or to the appeal board and attempts to collect-how much? Instead of $83,000, as collected from the broadcasting stations last year, it attempted to collect $191,000 this year in order to make up the losses which it said it had sustained by the passage of this bill, although, as I have indicated, the director said there was really no loss. But we have to thank the appeal board for its action in the matter, because had the appeal board not taken a hand, had it not reduced the minimum fee of this society, dear knows where it would have stopped. The appeal board brought their fee down from $30 to $5 as a minimum. The appeal board has allowed this society the $83,000 which was allowed last year from broadcasting stations plus some $6,000 additional to make up for the increased number of radio licences issued by the department as at March 31 last.

This is just about the driest subject that one can broach, and there is no interest occasioned in it except by persistency; but I want to try to impress on members of the government the actual burden which this society inflicts upon the public. In the Canada Gazette of November 5 last you will find

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a statement of the fees which this society proposes to charge for 1939, and in the Canada Gazette of January 7 there appears a statement of the fees which have been approved by the appeal board. I ask hon. members if the people generally are not justified in the conclusion that these fees go to the government and not to the society. The government seems to sponsor this private Canadian Performing Right Society as it sponsors no other institution in this dominion. In the Canada Gazette of January 5 what do we find? A government notice over the signature of three government officials. That notice tells the public and the users of music in Canada just what they shall do. It tells them that they shall pay this society so much in advance, that they shall make periodical reports to this society, that these reports must contain the number of performances of each sort of instrumental music, that they must say whether that music be afternoon, dinner, evening or otherwise, and that unless they do all these things they will be subject to prosecution for infringement of copyright. I want to ask why. Why should the government sponsor advertising the rates for this private society and pay for the advertisement at the rate of about $600 in the official Canada Gazettef Why should it do so any more than pay for say the advertising and subscription rates of every periodical in Canada? There is no reason under the sun for it.

Then comes the question, to whom are remitted the fees which are collected here? Eighty per cent of the fees collected in Canada are remitted to the picture producers and the film agencies which really make up what are classed as publishers in the American Society of Authors, Composers and Publishers. It all goes to the large picture producers and theatre owners. To them I shall refer in just a moment.

In addition to this payment for advertising -it is trifling, I admit, but why should the people pay for it?-we have the Canadian Broadcasting Corporation paying the society

835,000 of the taxpayers' money this year. In the last five years they have paid the society nearly $100,000, and that is just a slight factor in the reason for increasing the radio licence fee from $2.00 to $2.50. It does not amount to much, but why under the sun should the people of Canada pay these fees to a society that does not prove its ownership? Somebody slipped.

Take the Canada Gazette for January 7 and then look at the amendments to the Copyright Act. Permission is given the society to collect fees and royalties for the use of music which it claims to own, whereas the amendment of last session provides that it may be permitted IMr. Esling.]

to collect these fees for music which it does own or in respect of which it has authority to make collections. Anybody can claim anything and that is the trouble with the society. It has been making these claims right along and the government does not realize the imposition. The society claims by assignment the ownership of between two and three million pieces of music. Who knows whether it does own that music or whether there was ownership in the assignors? When an individual or an orchestra or a band is prosecuted for the use of music for which royalty has not been paid, that defendant is compelled to show that the society does not own the copyright. That is an impossible situation. The average man has not the financial ability to prove such a thing as against a corporation that is backed by millions of dollars- and when I say backed by millions of dollars I mean that it is backed by the American society, which is composed of theatre owners and picture producers.

Can any hon. member give one good reason why Canada should continue to be a member of the Berne and subsequent conventions? The United States is not a member. The American Society of Authors, Composers and Publishers is not a member because it finds it to its advantage not to be. Instead, it uses the Canadian society as an instrument for collecting money from the people of Canada in order to fill the purses of the picture producers of the United States. We must not lose sight of the inherent right of the individual to all that is due him under the Copyright Act; but when it comes to a concern acquiring these copyrights for the purpose of creating a monopoly and levying tribute on everyone, then I say the government should intervene. I do ask the government to consider the question of withdrawal from the Berne convention.

I wish now to refer for a moment to the Canada-United States treaty. I do not think anyone is fully qualified to pass judgment on the treaty as a whole until the matter has had a full-dress review in this house, because the opinions that are expressed are governed largely by the way in which the treaty affects each member and the people of his district. So far as West Kootenay is concerned, we have mines and fruit. There is a reduction on zinc going into the United States, but to Canada it means absolutely nothing because Canada is governed by world prices. In the United States the zinc market is self-sustaining and they do not have to worry except for the fact that through the reduction in duties the producer in that country gets that much less. That is on account of the fact that

The Address-Mr. Esling

United States prices are governed by London prices plus the duty. We are governed entirely by London prices. But there is one certainty about the treaty so far as we are concerned, and that is the cost to the people of Canada in dollars and cents.

There are 447 items on which all excise is removed, and that means that the Minister of Finance must make up $10,000,000 there. There are 238 items on which there is a further reduction of duty, and a conservative estimate of the duty will give about $8,000,000. To appease the Canadian industry, which will suffer by reason, of the importation of manufactured goods from the United States, if we accept the press reports, the government intends to go further and reduce or cancel the excise oh the raw materials used by Canadian manufacturers in order to permit of competition with similar products from the United States.

May I say that it is a genuine pleasure to have the Minister of Finance back in the house able to resume his duties. I imagine that his lot, the lot of any minister of finance, is a most unhappy one, particularly on the eve of an election when he has to combat the preelection demands-I will not say requests-for more funds than he would like to give out, demands that come from what we might call a top-heavy majority of government followers. They are the ones he has to consider.

For a moment now I will deal with the Income War Tax Act. I suggest to the minister that in addition to the $20,000,000 which he has to make up by reason of these losses under the treaty, he has a great many other troubles to which he must give his attention. He has, for instance, the wheat losses. They range all the way from $30,000,000 to $60,000.-

000. Let me be modest and put it at $30,000,-

000. Then he has to cover another $18,000,000 of loss of sales tax on building materials, $12,500,000 on terminals, and about $2,000,000 or $3,000,000 on the importation of goods under the $100 exemption. Then there was the Canadian National deficit, which in last year's estimate was placed at $42,000,000. The press reports indicated that at the end of six months that $42,000,000 was gone and that another $12,000,000 would be required. With all these worries the Minister of Finance will almost throw up his hands in despair and ask what is the use. Will he not welcome a suggestion which would bring in something instead of allowing it all to go out?

By amendment to the Income War Tax Act, there was a decided loss to the government. Hon. members know full well that if anybody living outside of Canada has an

investment in Canada he is subjected to a deduction of five per cent in the remission of the revenue from it. If from some investment he has a revenue of $100 his agent sends him $95 and accounts to the government for the other $5. But for some reason the government was persuaded in 1936 to reduce that five per cent to two per cent in connection with films. I contend that this government has in the last three years lost no less than $450,000 to $500,000. The film agencies say that they are entitled to this reduction because when their films have been run-and I am told by a theatre manager, that the average run is about four hundred times-the films are worn out. Suppose they are; I submit that does not make any difference.

I do not want hon. members to think that I am speaking at random; I ask them to take the report of the Minister of Trade and Commerce covering motion picture films. For the year 1936 they will see that the rentals for films paid to these agencies amounted to $7,-

500,000, and in 1937 it was $8,790,000, an increase of over a million dollars. First of all they wrote off in 1936, about $1,008,000 in wages; according to the report, for 1937 the figure was $1,060,000. That is all well and good. They are supposed to retain for the benefit and profit of the agency some 35 per cent, and the balance is remitted to the picture producers and theatre owners in the United States.

It appears to me that Canada is fertile ground for raising money to transmit to these picture producers and film agencies in the United States. They do not lose anything on these films. Hon. members must not think that into each province of Canada there comes a film from the states. Not at all. They bring in one negative and send it to a film processing plant in Montreal or Toronto, and from that one negative they make as many prints as are required. That negative is valued for duty purposes at five cents a foot, which represents about $165 on a film of

7,000 feet-I use that figure because according to my information that is the average length of a film. Everything is by the foot, whether it be from the United States or for distribution in Canada. The film remains here only ten days and then goes back to the producer undamaged. The prints are turned over to the film agencies for 31 cents a foot plus the sales tax, so that the total cost of a film shown in one of these theatres for as long as it can be used is about $246.

Talk about figures as long as you please, the fact remains that these films yield a rental of between seven and eight million dollars a year. Yet for some reason the government thought it necessary or advisable to reduce that

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five per cent tax to two per cent. The five per cent could well be paid. I think the minister should take steps to recover the half million dollars that he has lost in the last three years; certainly there should be no further loss. The agencies in each province are supplied with as many prints as they want, and there cannot possibly be any loss to the agency.

I ask the Minister of National Revenue, then, to include transport cooperatives under the exemption clause, and to see that this three per cent reduction no longer applies to films. There is no reason under the sun why huge concerns sending millions of dollars to the United States should be more favoured than the poor fellow in the United States who has a little investment in Canada from which he receives a dividend. And also I ask the Minister of Transport to drop the tax or toll upon wharves used by settlers.

Mr. T. V. GRANT (Kings):

As the hon. leader of His Majesty's Loyal Opposition (Mr. Manion) is a distinguished member of the profession to which I have the honour to belong, I wish at once to extend my hearty congratulations to him upon having been chosen at a nation-wide convention as chief of the National Conservative party of Canada, which supersedes the Liberal-Conservative party.

I think our hon. friends are making a great mistake in changing their name so often. In other walks of life only companies that have gone bankrupt, or individuals who have got into difficulty and would feel safer under some other name, change their names. Even some ladies hesitate to change their name, although they are specially privileged in that regard. Why has the Liberal party not found it necessary to change its name-

Mr. LAPOINTE (Quebec East):

They are proud of it.

Mr. GRANT:

Of course they are. There is something fascinating, something charming about it. There is much to be proud of, and nothing to be ashamed of, in the name " Liberal." Even the Democrats in the United States like to call themselves Liberals.

There is much wisdom in the oft-repeated expression that there is none so blind as those who will not see. Our opponents have demonstrated the truth of that saying in their interpretation of the speech from the throne, a document which no well-informed Canadian can deny to be a true summary of a record of achievement unequalled in any similar period by any previous government in Canada. It would take much more time than I have at my disposal, and a much better artisan, to deal

adequately with the various items in that speech. But I join with all loyal Canadians in welcoming to this country Their Majesties King George VI and Queen Elizabeth. This is the first time in history that Canada has been honoured by a visit from her sovereign.

In connection with the royal visit no doubt many maritimers had to smile recently when it was announced over the radio from the old country that their majesties would visit " Canada, Prince Edward Island, Nova Scotia and Newfoundland." And yet Prince Edward Island and Nova Scotia, in the order named, are the two most important provinces in this great dominion. Prince Edward Island, the cradle of confederation, comes first, although we have been given this doubtful special mention over the radio.

My next pleasant duty is to congratulate the mover (Mr. Matthews) and the seconder (Mr. Chevrier) of the address in reply to the speech from the throne. The mover, a native of Prince Edward Island, to which I belong, did not surprise me in the least when he delivered his fine address. Before he left the garden of the gulf for a wider field of endeavour, I had intimately known him as a clever writer, a polished speaker and an educationist. His departure at that time was regarded as a distinct loss to our province.

The seconder has been a near neighbour of mine on the back benches since I came to the house in 1935. I have always found him a most agreeable and lovable gentleman, and I am proud of the exceptionally good speech he made, delivered as it was in both the official languages. It was a treat long to be remembered.

Before leaving the matter of paying compliments let me extend my heartiest congratulations to another genial associate in the person of the new Postmaster General (Mr. McLarty). I am sure his recent promotion will not tend to decrease his popularity among his former companions in the house. The distinguished though lone Liberal member from Alberta (Mr. MacKinnon), with whom I am not so well acquainted, is also deserving of congratulation upon his promotion to the cabinet. I understand his wife comes from Prince Edward Island, a fact which bespeaks his good judgment.

I was surprised to hear the leader of the opposition stress unemployment in his first speech since his return to the house. It is too true that his party was elected on the unemployment cry in 1930.

Mr. MacNICOL:

And we shall be elected on the same cry next year.

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Mr. GRANT:

At that time there were

117,000 unemployed in Canada, and by featuring this comparatively new inspiration they succeeded in persuading the Canadian electorate that it was a most serious state of affairs. Their leader's voice resounded from coast to coast in such expressions as, "King promises to enact measures to relieve unemployment; I promise to end unemployment. Which do you like best?"

Miss MACPHAIL:

None of you ends it.

Mr. GRANT:

But on taking office what did they do? They added more than 100,000 annually to the unemployed in Canada, and did little but herd them like cattle into unemployment camps of idleness, until the unemployed in Canada exceeded the million mark. I well remember a speech delivered by the then Prime Minister after the numbers of the unemployed had reached about

600.000, in which address he stated that 150,000 unemployed was normal for a country of

10.000. 000 people. And yet, in 1930, he and the present leader of the opposition bellowed themselves into power on the cry that to have 117,000 unemployed was disastrous. I say to the leader of the opposition and his followers that such a cry cannot be repeated, and might as well be dropped, so far as trying to deceive the electorate of Canada is concerned.

Miss MACPHAIL:

But it was repeated

by the Liberals.

No.

Mr. GRANT:

Our opponents would like to make it appear that the government has been idle. One hon. member who, I am sorry, is not in his seat, has described the procedure as that of waiting for Santa Claus. Nothing could be more unreasonable. We have had Santa Claus continually with us since 1935, in the person of the senior member for Queens, Prince Edward Island (Mr. Dunning)-and may I say that regardless of party affiliation, all hon. members are delighted to see him with such a ruddy complexion and looking so well since his return to the house. I doubt very much if the hon. member who made that statement will have as generous a Santa Claus to deal with him when he hangs up his stocking after the next federal election.

This government have been alert and progressive since the first session of the present parliament. In fact the Prime Minister (Mr. Mackenzie King) has consummated a trade agreement with the United States even before the first session of parliament. In my own constituency programs 71492-32

of public works have been carried out continuously by both federal and provincial governments. In many instances the work has been done jointly, and in order that the needy should not be overlooked in the distribution of work the federal Department of Labour appointed a war veteran whose duty it was to visit the various undertakings and see to it that the poorer and the more needy were given work in preference to the more fortunate.

Since the federal election of 1935, no time has been lost in striving to provide work for our people, through the construction of public works which had been entirely neglected for five years under Tory rule, and by numerous other undertakings, some of which I shall enumerate later. In my constituency almost every federal wharf, with the exception of the one adjoining the business stand of the Tory member who then represented Kings, was either fenced off or had a danger sign posted on it.

With regard to defence, regardless of what our opponents in other groups may say, I believe the government should not engage in the manufacture of war material. We have white elephants enough on our hands in Canada. If we must have armaments, let there be competition, as in other public contracts, and let the work be done under honest and competent government inspection. Let there be no pets or favourites, or anything in the nature of a family compact. Large sums of money which are being asked for to provide for defence would then be spent to the best advantage. Let it not be said at some future time that some one has "plundered". I am not a military man, and shall leave the debate on this subject to those who think they know what should be done to meet any condition which may arise out of what is taking place in this confused and troubled world.

As other hon. members have said, the new trade agreement between the United States and Canada has yet to prove its beneficial effects. But we know the trade agreement of 1935 has helped to save the country from ruin through stagnation of trade, and we know the new trade agreement has been built on a firm foundation, and with the most friendly understanding between the Englishspeaking nations on this continent. It was surprising to hear the leader of the opposition condemn the abolition of the three per cent excise tax, which was one of the obnoxious taxes imposed on the people by the late government on top of all the rest of the taxes, and at a time when the people had been ruined by high tariff policies which

The Address-Mr. Grant

brought about a stagnation of trade. Yet the new leader of the Tory party states in this house that he believes in trade agreements and reductions in taxation! The impressions of youth are hard to eradicate.

The leader of the opposition states that we have not reduced taxation, and yet in the same breath he complains that the three per cent excise tax has been removed. Let me quote a few words from the speech of the governor general:

The Canada-United States agreements have involved, in addition to the wider markets secured for Canadian products, a thoroughgoing revision of the Canadian tariff structure, and a reduction of taxes on trade much greater than that made by any previous parliament, or by any other country in recent years.

Do our hon. friends opposite think for one moment that the intelligent electors of Canada, who suffered so much during the five years the party opposite were in office, will vote against a government that has done more than the government of any other country in the world to reduce taxes and encourage trade?

The present Liberal party is no more perfect than any other man-made organization. I had hoped for some constructive criticism this year from the official opposition after their three years of subjugation. They were recently delivered from bondage at a convention of their party, and I had hoped that during this session they might show themselves worthy of retaining their present position after the next election, which is all they can hope to retain. Whatever may be said about the Grits and the Tories, it cannot be denied that they have been democratic in principle, and we do not want to see the present official opposition relegated to third or fourth place in this house. I think their new leader has had ample proof of that.

The recent visit of President Roosevelt to Canada was significant in many ways. His assurance during that visit of the loyalty of his great nation to this dominion in case of invasion should dispel from the minds of our opponents their apparent fear that our United States neighbours are not to be trusted. I think our hon. friends can be reassured that with Liberal governments in office in Canada and the United States, trade treaties will be respected in both countries. The treaties of 1935 and 1938 are but the beginning of freer trade arrangements than have hitherto existed between these two peace-loving countries. I suppose there would be a great many obstacles to the removal of the present strict immigration regulations now in existence in both countries, but I cannot see any reason why such barriers should continue to exist. I

believe their removal would result beneficially to both the United States and Canada. While I am not in favour of opening the gate to foreign immigration, I doubt the wisdom of dividing the north American continent into two pens.

The brilliant young member for Winnipeg South Centre (Mr. Maybank) stated in effect some days ago that when the present leader of the opposition was Minister of Railways and Canals in the previous government he was responsible for certain amalgamations and reductions in the railway service, and that the people of this country feared amalgamation, but the hon. leader of the opposition denied this charge in emphatic terms. During his term of office, however, as Minister of Railways and Canals, the Elmira branch line in my constituency was closed out entirely as far as passenger service was concerned, and the Post Office Department was obliged to establish a mail route to serve this territory. Another line, the Murray Harbour branch, was reduced to three trains a week, and in this instance a mail route of approximately eighty miles had to be established by the Post Office Department.

Mr. MANION:

I do not want to interrupt the hon. gentleman's essay, but I should like to point out that when I was Minister of Railways and Canals I had nothing to do with the running of trains any more than the present Minister of Transport (Mr. Howe) has anything to do with that. I had nothing to do with the closing of branch lines or anything of that sort. That was done by the management of the road without consultation with the government. I think the Minister of Transport will tell my hon. friend that if he does not know it already.

Mr. GRANT:

I said, during the hon. gentleman's term as Minister of Railways. Another line, the Cardigan branch, was scheduled to be reduced to three trains a week, and the railway time-table contained the change, but a certain minister without portfolio in the late government happened to be operating a general store on the Cardigan line and that part of the time-table was never put into effect.

But let it be said to the credit of the present Minister of Transport (Mr Howe) and the management of the road that we succeeded in having the train services restored in my constituency, to such an extent at least that the mail routes referred to were done away with during our first year in office, and indignation meetings which were at least semi-annual occurrences during the Tory rule have not occurred in a single instance since 1935. These

The Address-Mr. Grant

are facts well known to every elector in my constituency, and they are unimportant compared with the charges made against the late administration by the employees of the Canadian National Railways.

When our opponents say that we have done nothing to relieve unemployment and to assist the farmers and fishermen, how can they shut their eyes to the splendid trade agreements negotiated by this government; to the National Housing Act; to the Municipal Improvements Assistance Act, and to the home improvement plan under which loans at the lowest rate of interest in history are made to municipalities, organizations and individuals in order to encourage employment? How can they shut their eyes to the abolition of the sales tax on all building materials, including paint and heating and plumbing, in order to encourage the building trades; to the assumption of provincial and municipal taxes on the properties so constructed; to the abolition of the obnoxious excise tax imposed by the previous government; to the encouraging of public works by assisting the provinces with federal aid; to the assistance given the unemployed by a most liberal expansion of public works; to the program of settling unemployed young men on farms in provinces adopting this plan; to the amendment to the War Veterans' Assistance Act; to the employing of young men in forestry conservation work; to the courses given to young men in the arts of curing fish, scientific farming, carpentry and other trades; to the supplying of seed grain to farmers and to the opening of world markets for the sale of farm products; to the loans given without interest to fishermen to enable them to buy nets as well as food for their children; to the reimbursement of the fishermen for losses due to storms; to the Unemployment and Agricultural Assistance Act, and to the appointment of fishermen's assistance boards which, among other accomplishments, erected a great many up-to-date buildings-at least six in my constituency-at fishing centres in which buildings the fishermen may cure and save their products, and the construction of which provided employment for the fishermen? The electors of Canada, Mr. Speaker, know all these things, even if some members of this house choose to shut their eyes to them.

The leader of the opposition stated that the present government, or perhaps he said Canada, had done less in the way of social legislation than any other country in the world. But let me point out that except for two or three years the Tories have had a majority in the senate for the last twenty years or more, and that when Liberal governments tried to pass social legislation, a Tory senate invariably threw it out. The old age

pensions legislation is an example. The bill passed this house but could not survive in the senate until the Liberals at last had a majority in that chamber. And the irony of it was that the Tories, after voting against the old age pensions scheme and defeating it in the senate, once it had been enacted despite their opposition brazenly adopted it as part of their 1930 platform, and boldly promised to pay the pensions one hundred per cent from the federal treasury. I think every elector of pensionable age received from the Tory organization a circular letter containing this promise. The official opposition should be ashamed to mention social legislation in this house or anywhere else in Canada. They did reluctantly, when in power, pay seventy-five per cent of the old age pensions because the Quebec government forced them to do so. It was not because of their pre-election promise.

Let me at this point give a brief summary of the promises made by the Tory party to the rural mail couriers of Canada before the 1930 election. It was well known that the rural mail couriers had been organizing for some years; that almost every mail courier had joined the organization and paid the membership fee, and that they were all naturally anxious for a change from the tender system to employment under the civil service of Canada, with a guaranteed living wage and permanency of employment. The then leader of the Tory party, mad for power, resorted to the lowest kind of deception in this instance. Letters were sent out to each and every mail courier in Canada promising to comply with the wishes of the couriers' organization, immediately upon the party's being returned to power. Imagine the influence on these poorly paid mail contractors! They honeycomb Canada from one end to the other, and come in daily contact with all classes of people in the rural sections. They have numerous friends; of necessity they are educated, upright, honest and intelligent, and until 1930 they were unsuspecting. Whatever the Liberal party has done or has not as yet been able to do, we have not attempted to deceive the mail couriers. The Tories deceived them and got their votes and support in 1930. But as a class the couriers have good memories, and they now feel that if their grievances are to be settled this will be done by a Liberal government. I should like to hear some one of our Conservative friends opposite, especially one of the 1930 survivors, discussing this question of the mail couriers.

Some of our opponents have said that the dictators are showing the democracies how to end unemployment; that there is no unemployment in countries ruled over by dictators. Well, Mr. Speaker, if the United States, for

The Address-Mr. Grant

example, wished to adopt the same method followed in Germany or Italy of ending unemployment, she could declare war on Canada, and that would end unemployment in both countries until the war was over. Most of the dictator countries have their surplus population either training for war or actually under arms. But Canada and the United States, being peace-loving countries, desire to find honest work for all their people.

I believe, sir, that every member of the Tory party, every member of the Cooperative Commonwealth Federation, even those who have taken post graduate courses in Russia, and every member of the Social Credit party, the party which makes money out of nothing but their words only, as the Lord made the earth, knows that in the last three years this government has done more to relieve unemployment than could possibly be done by adopting their fantastic policies-and the electors of Canada know this too.

I am sure that every member of the Liberal party in this house and throughout Canada, every elector who supported the Liberal cause at the last federal election, and a great many who did not, are proud of the manner in which the right hon. the Prime Minister of Canada (Mr. Mackenzie King) answered the charges made against this government by the hon. Leader of the Opposition (Mr. Manion), and that all thoughtful Canadians are indeed thankful that Canada has had at the head of her affairs in these troublous times a man with the long experience and vision of the Prime Minister. Fathers and mothers who wish their families to grow up as peace-loving Canadian citizens have indeed much for which to be grateful. The electors of this dominion feel that they are in safe hands once more; the fishermen know that this government is doing everything humanly possible to solve their difficulties; the farmers who were well to do in 1930 but were either bankrupt or facing insolvency in 1935 have again taken courage, and with the fair prices they have been receiving for their products are not considering a change of government; the fox producers, whose uncertain industry has been placed on a secure foundation by the joint regulations inaugurated by the departments of agriculture, provincial and federal, are not considering a change of government.

In conclusion, Mr. Speaker, speaking of agriculture reminds me that the genial minister of agriculture for the province of Prince Edward Island, the Hon. William Dennis, has been seriously ill in the civic hospital here in Ottawa, and I would ask every member of this house who loves a good sport to say a prayer for his complete recovery.

Mr. DAVID SPENCE (Parkdale):

Mr. Speaker, the hon. member who has just preceded me has gone far beyond the bounds of parliamentary discussion in saying that our honoured leader in the last election resorted to deception. I object to that because it is not, in my opinion, proper for any hon. member to use that expression, and anybody who knows the Right Hon. R. B. Bennett knows that he never used any deception. Let me tell the hon. member that it will take more than the support of the rural mail carriers of Canada to save him and his party at the coming election. The hon. member spoke of being proud of the name Liberal. He also claims that in the United States the Democrats are resorting to that word to describe their party, but may I remind him that the Liberal party in Canada has nowadays very little beyond its name of which to be proud. With some of the things he has said about the Prime Minister (Mr. Mackenzie King) I agree; with others I cannot; but of course he has the right to say what he likes, when he likes, and in whatever way he likes.

For some weeks I have sat here attentively listening to a good many speeches. Until yesterday I did not know that I was going to speak in this debate. Since I came back from Toronto I have had little time to prepare anything, but I have in my head a rambling lot of stuff which comes from my knowledge of the business world and has been instilled into me for a good many years.

The speeches made in this debate have been splendid; each one has expressed the views of the speaker and frequently the views of his party. Regardless of what may be said outside this house in criticism of them, they are a credit to Canada, and I am sorry that my own lack of training will not allow me to maintain the standard which some others have reached. My life in the business world has been a busy one, and I have had no opportunity of training along the line of making speeches in parliament; in fact I never expected to be in parliament. I am here, however, and I am glad to be here. I intend not to make a speech but to offer some observations in my own way about matters of which I know something.

I am sorry that my good friend the Minister of Finance (Mr. Dunning) is not in the chamber. I am delighted that he is back in the house and is feeling in good condition, smiling as he usually does, and sometimes adding a little sarcasm to his wit and humour. He would not be genuine if the sarcasm could not come out as well as the humour; in that respect he may be like myself.

The Address-Mr. Spence

I wish first to offer my congratulations to the hon. member for Brandon (Mr. Matthews) who moved, and the hon. member for Stormont (Mr. Chevrier) who seconded the address

in reply to the speech from the throne. Both of their addresses were admirable, and as good a presentation of the subject as I have ever heard.

I can assure hon. [DOT]members that the old historic riding of Parkdale will rejoice with the rest of Canada at the coming of Their Majesties King George VI and Queen Elizabeth. We shall all be proud to see them. I know the people of my riding will be present in large numbers to see the king and queen, because we are not far from what will be the headquarters of their majesties while they are in Toronto. If they are given, a nice drive, which I hope will be arranged, they will go through a portion of my riding which is the most attractive part of that city. We shall all be delighted to see them there.

I would first ask forgiveness if anything I may say should hurt somebody's feelings. It is absolutely not my intention to say anything which will cause strife in this house; I do not think I have ever attempted to do so. I have always acted more or less as a peacemaker among some of my hon. friends, even those on the other side of the house.

We have to-day plenty of trouble, without creating any more strife. We have no unity, no cooperation among ourselves and worse still, no cooperation with other countries. Conditions everywhere are in a terrible state, and we have found no superman yet to solve our problems.

Some hon. members have suggested as a remedy the nationalizing of everything, and especially the controlling of business. My advice to this or to any other government is to forget nationalization and attempting to control business because it cannot be done. While in business for many years I have learned at my own expense that the law of supply and demand will always regulate prices. There is no use of any government trying to run business; they cannot do it; it requires men trained in the business world. The government should stop interfering with business and tinkering with tariffs. Many men have been driven out of business because the worry of running business to-day is greater than can be realized by anybody who has not had practical experience in it.

I agree with the statement which has been made in this house that customs regulations should be simplified. There are many rulings which not only the customs officials, including the commissioners of the different branches, but the minister himself, cannot understand, and the fact that there is such diversity of

opinion among those who are administering the customs tariff makes it impossible to get a definite decision from anybody. About a couple of years ago there was put on the order paper a resolution to the effect that, something should be done to make it easier for customs officials and business men to understand customs rules.

Toward the end of the session of 1937 the Minister of National Revenue (Mr. Ilsley) introduced a bill to prevent men who had claims against the government from realizing on those claims. I consider that this was quite unfair. He had that bill piloted through the senate committee with the assistance of all the commissioners he could gather together and the odd hired individual who had left the department and who was brought back for the purpose of defeating the wholesalers and importers who were trying to have their claims satisfied. One would think he was dealing with a bunch of thugs or highwaymen rather than with men of high integrity in the wholesale business. Not only did he prevent them from getting their money, but there was put through this house a bill that had the effect of putting them out of court altogether so that they could not sue the government.

He did, however, allow two big firms in Toronto to sue the government for drawbacks which they should have received that year and years back, and they successfully beat the government in the courts. I am wondering whether the government have paid their debts. My view is that the government themselves should pay their debts just as they expect others to do. I do not know how much money was involved in that particular case, but the gentleman in Toronto who looked after the railway claims and the claims in connection with customs had the whole thing compiled. The fact is, however, that the government had the money with which to pay their debts, and they should have done what a good many others do when they fail. Private persons give their creditors 50 cents or 20 cents on the dollar. But instead of that the government robbed these people of every dollar that was legitimately due them. Would anyone with high integrity do such a thing? Is it any wonder that conditions are as bad as they are? Is it any wonder that no one wants to be in business, that no one wants to own a home or property or anything else, because everybody is robbed to death? We are all simply asked to pay taxes. When this gentleman who was looking after the claims of the railways and customs went back to Toronto, he took to heart so seriously the treatment he had re-

The Address-Mr. Spence

ceived at the hands of the minister in the senate committee that he dropped dead. He left here on Thursday night and on Friday night he was dead. He was only a young man, between thirty and forty. That is the way in which this government is treating people; driving them into their graves. I am not saying this is the only government that has done such things, but this is the worst instance I have ever known. Thousands of dollars were stolen from people in business, and not a dollar to which they were justly entitled was paid them. That is lesson number one.

The firm that I backed financially had no claims against the government at that time, because my advice to them was to do no business through the government, but to act through someone else. I remembered that for thirty years I had done nothing but fight with the customs department in Toronto, though I must add that there have been ministers who straightened things out once in a while. The Hon. Jacques Bureau was one of them; the Hon. Doctor Reid was another. Then there was the Hon. Mr. Boivin, who died suddenly in 1926. I believe the Minister of Trade and Commerce (Mr. Euler) was also minister for a while, and we got fair consideration. I never regretted any man's death more than I did that of Mr. Boivin, because I thought he would make a wonderful minister. I had not hoped that he would be elected, but I liked him as a man because he was fair in his dealings with the business world, just as were the others I have mentioned, as well as the Hon. Mr. Ryckman. But there have been ministers who have not been as considerate, and the time is coming when the business world will have to teach them to be fair. I am not making any threat because I am not in business now, but I am still interested in how many people the government rob. Nearly everyone capable of being robbed has already been robbed.

The hon. member for Kootenay East (Mr. Stevens) has told us of the large percentage of people in business who are dying suddenly of heart trouble. It is all too true, and this government has been responsible to some extent by continually changing conditions and making it almost impossible for business men to carry on. The government appointed a national employment commission, and it will be remembered that I fought bitterly against that move because of the extreme cost which the commission would involve. I could not see what they eould accomplish. We were informed that they would tabulate the unemployed by trades nnd so on, but what does that matter? After

(Mr. Spence.]

all, what difference does it make to what trade a man belongs so long as he is unemployed? Does it matter whether he is a carpenter, bricklayer, machinist, or anything else if he cannot get work? He is unemployed just the same. All that the commission did do was to go to the different municipalities and get a list of the unemployed. That list was in the Department of Labour at the time, so that the expenditure involved was really a waste of money.

The recommendations of the commission have not been adhered to rigidly. There is only one recommendation I wish to touch on at the moment and that is the one with respect to the training of youth. I have to give the Minister of Labour (Mr. Rogers) some credit for that. I had the pleasure of going into a committee room one night and seeing pictures of boys training in the camps in British Columbia, and I listened to addresses from men and women from all parts of the country, telling how enthusiastically the municipalities were cooperating in the training of these young people. But the trouble is that there is no stability about it. I agree that it should be done because there is nothing else you can do, and it is better than doing nothing. It will help the boys and girls even if they get six weeks training, and it should improve them mentally, physically and morally.

I suggested at that time that instead of appointing these commissions we should restore confidence in the investing public, because I felt that this would do more to create employment than anything else. There are thousands of people in Canada with millions to invest; if we had stability in government, if investors knew that conditions would not be suddenly changed but would remain reasonably constant, investment would follow. The Minister of Justice (Mr. Lapointe) now agrees with me that the proper thing to do is to restore confidence in the investing public. He brought out that point in a speech in Waterloo when he was trying to defeat the hon. member for Waterloo South (Mr. Homuth). I am glad that the minister took up the suggestion. I am convinced that there is enough money in the pockets of the Canadian people to put the country on its feet, but the government is making cowards of us all, driving people to buy government bonds. I have not much use for the man who does nothing but buy government bonds. The man who has not enough backbone to go into industry and try to make a living in that way is not doing much for the country. I would not give much for him if he puts his money into government bonds and keeps it in hiding.

The Address-Mr. Spence

How can confidence be restored when the government are negotiating treaties all the time, always negotiating treaties with someone? That has been the custom in the past, but this government has negotiated more than we ever did. I do not think we have been guilty of so many offences that have hurt the country so much. The man who has a vision of the future can see that the treaty now negotiated will drive some subsidiary companies back to the United States, and prevent anybody from putting his money into either business or industry. In my riding there are many industries, because when the big fire occurred down-town one time they were driven to the outskirts and we got many of the factories. Some of the people operating these industries to-day are afraid to say a word, afraid to express an opinion, about this treaty. I have not much sympathy for some of them because they did not support a government that would have given them stability, but now they are out howling on the housetops, but afraid to say a word to the government. It is not good for a man in business or industry to be afraid to talk to the government; they cannot put him in a penitentiary unless he commits a crime; in any event you can always tell them what you think of them. It is true that importers will like this treaty; but they, like the man who puts all his money in bonds, are another class for whom I have very little use. They bring stuff from any country in the world where they can get it and kill manufacturing industry in this dominion. The importer may sit in an office in a twenty-storey building and look out of the window for half his time or look at his nice stenographer, while stealing business from the Canadian manufacturer by bringing stuff from all parts of the world and particularly Europe.