Mr. Sinclair:

By stamping on the toes of our best customers; that is the way you have gone about it.

Oh, no it is not.

Mr. Diefenbaker:

It is apparent that the hon. gentleman who is the former minister of fisheries has not read the speech of his leader. I wonder, Mr. Speaker, whether these casual and entertaining interruptions might be discontinued-

It is one of your own; make him stop.

Mr. Gauthier (Portneuf):

They are speaking out of turn; they are not properly trained yet.

Mr. Speaker:

This is perhaps an unusual day. Nevertheless I cannot recognize hon. members if they do not rise in their places when they endeavour to make their points, and I would ask them if they wish to speak, to do so on a point of order or by some other proper means.

Mr. Diefenbaker:

If I may add this, far the moment, Mr. Speaker, I misplaced this clipping. He apparently did not listen to one of his former colleagues speaking at the coliseum on Thursday. What did the former associate minister for defence say? The hon. gentleman ought to start teaching him. He said:

Canada should go along with the United States 100 per cent on mutual defence, but we should get tough.

Mr. Hellyer is one who has apparently learned. He is apparently one of the nine who did not come back. He went on:

We should get tough and ask the United States to buy much more goods from us than they do now.

That is exactly the present condition of affairs. I am not saying we could get tough, but that is the recommendation, and this is the best answer to the right hon. gentleman.

Mr. Sinclair:

The answer you got was 15 per cent on oil.

Mr. Diefenbaker:

As far as the oil situation is concerned, the hon. gentleman knows as well as I do that during the Suez crisis it became necessary to develop oil supplies from

other parts of the world. Certain parts of the United States were closed to the oil, but the Pacific coast district was open. On the reopening of the Suez canal far earlier than the date which was expected the United States found itself in a position where, it is claimed, it will be inundated with oil, and instead of having a broken market-a depressed market-and a fall in prices that will be economically detrimental to the producers of the world, the only solution-this is their explanation-is the one they have adopted. We do not accept that, but that is the explanation of the United States. They intended to go even further, as I understand it, but we made representations, and what hon. members opposite fear is that in the last few days, having regard to the response given to that complaint on the part of the United States, there is at least a qualified prospect that the United States is going to reconsider the matter.

But here something that I cannot understand the Leader of the Opposition saying:

I must say that I do not believe we increase confidence in Canada by attacking our triends in other countries. Those who previously criticized us for not-as they put it-standing up to the Americans are now discovering that talking up is not the same as standing up.

I will deal in a moment with the way in which hon. gentlemen opposite have stood up. They stood up much as they intend to stand up for the amendment they moved today. Then the hon. Leader of the Opposition said this, and this is something I think he will regret:

Even when they merely talk up they have been slapped down.

Mr. Sinclair:

"We fixed them".

Mr. Diefenbaker:

The hon. gentleman is the leader of a great party, but he made that statement, and I find it difficult to understand that a Canadian should gloat over the refusal of a foreign government to consider Canada's representations. I ask hon. members opposite what they did. They say today: "Do not let us take a stand as Canadians on behalf of our rights; let us go in by the back door in Washington; let us not stand up for our rights, even though not in a threatening and not in a truculent way." But as far as Canada is concerned we cannot maintain our integrity with the type of adverse balance in trade which has been increasing year by year.

The United States embarked on their giveaway program while the former Liberal government was in power. What happened? They wrote a couple of notes and when we asked in this house for the production of those notes, the then minister of trade and commerce said: we will not produce them.

Suggested Resignation of Government Then we asked what replies he got, and he said: they were not written in such a way or couched in such terms as to admit of a reply.

I ask hon. gentlemen opposite this: when they were in office do they remember that the United States imposed quotas on Canadian rye, dairy products, clover, seed potatoes, oats and barley? That is the picture. And when anyone says to me that we are being fairly treated, as the hon. Leader of the Opposition does, I simply ask him to read the United States papers. I spoke on this subject at Dartmouth University and I was amazed by the fact that from all over the United States letters were sent to me saying that Canada had a legitimate grievance; that we were placed in a position where the United States exploited our raw materials and our semimanufactured goods while at the same time closing out, generally speaking, our agricultural exports to the United States.

I propose to read part of a short summary of an article which appeared in Barrons magazine on December 30, 1957. It is entitled: "United States must End Economic Warfare Against Canada." It reads:

The United States in short has showered down good will upon the four corners of the earth. Closer to home, however-virtually in its own backyard- it has chosen to behave in contrary fashion. In particular, in terms of trade policy this country long has acted badly toward the Dominion of Canada. Heedless of damage to the wheat growers of Manitoba, the administration has sanctioned the dumping of domestic surpluses on the world market. Similarly, it has confronted the Canadian mining industries with the threat of higher tariffs on non-ferrous metals. Finally, over the strenuous protests of Ottawa-and in violation of its own commitments-Washington last week decreed the extension of "voluntary" quotas on foreign oil, including Canadian crude, to the west coast. Such moves undoubtedly have pleased, if not appeased, various special interests at home.

The article goes on:

Canada has deserved well of this country. Instead somehow it has become a favourite whipping boy of various United States agencies and interests. Several years ago, for example, customs authorities reclassified Canadian ping pong balls as ammunition-they can be used in pop guns-thereby raising the duty on them nine-fold.

Then the article goes on to discuss the picture generally. Anyone may read this article who wishes to do so. It finally ends with the warning that such conditions cannot be allowed to continue.

I wish to make a special appeal at this time. The President of the United States in his message to congress linked trade with defence. That his message last week, the week of the eleventh. He put his foreign economic program in dramatic perspective last week as essential for countering the Russian total cold war. I think that that was a

3536 HOUSE OF

Suggested Resignation of Government very proper view to hold, because, Mr. Speaker, let us not gloat over the economic difficulties of any nation in the free world.

The major challenge today of the U.S.S.R. is on the economic front. We do not make our contribution to the preservation of freedom by endeavouring to play ball favourably to ourselves in the matter of unemployment and the world trade situation particularly in the free world. Indeed, I point out to the United States once more that in the exchange of notes in 1950 recognized by both the government of Canada and the government of the United States as being in effect an agreement was made in the following language:

It Is agreed that our two governments shall cooperate In all respects practicable, and to the extent of their respective executive powers to the end that the economic efforts of the two countries be co-ordinated for the common defence and that the production and resources of both countries be used for the best combined results.

I say that interfering has occurred as a result of the embargo on oil and that the threatened action in so far as non-ferrous metals are concerned is something that must be reconsidered because an agreement was reached at the NATO conference in the following words which are not shallow words:

We will co-operate among ourselves with other free governments to further the achievement of economic stability, a steady rate of economic growth, and the expansion of international trade through a further reduction of exchange and trade barriers.

We recognize the interdependence of the economies of the members of NATO and of the other countries of the free world.

If that is recognized then I say that economic action taken at this time to interfere with those things that are of the essence, with the United States being a have-not nation to a greater or lesser degree with respect to non-ferrous metals, is something that in the interests of our survival in the free world deserves the most serious consideration on the part of the administration and the congress of the United States.

My hon. friend the Leader of the Opposition has referred to the adverse balance of trade and I am going to place on Hansard the degree to which that adverse balance has mounted in recent years. The figures are as follows:

Adverse commodity trade balance with United States

Year Million

1950 $ 80

1951 479

1952 627.9

1953 758.2

1954 593.9

1955 840

1956 1,282.7

1957 (First 11 months) 1,036.9

We are not suggesting any diminution of trade but a condition such as that cannot continue in the interests of the maintenance of the economic freedom of a country. My hon. friend the Leader of the Opposition said that we should try to anticipate these difficulties with the United States and avoid them. We should not, he suggested, give excuses to those in Washington for taking economic measures that hurt us. Let us see what the hon. gentleman said on this question before he thought he would occupy the position that he now holds. Let us go back to July 13, 1957, when he used a most peculiar comparison with regard to Canada. I do not know the meaning of it but perhaps he would care to offer an explanation. He made the remarks I am about to read in San Francisco:

The possibility of American domination-

We never heard anything like that from the hon. member in the House of Commons. The election was over and I suppose he was one of the few who thought it possibly would not do any harm to say a few things at that time.

Mr. Pearson:

Read Hansard.

Mr. Diefenbaker:

I continue:

The possibility of American domination expresses itself also in other ways. Our natural resources are becoming more and more important to a country whose own resources are being fast depleted. In many respects-

This is what I do not quite understand and I hope the hon. member might interpret this for us:

In many respects, Canada is almost virginal in this field of resources and you know what happens to foolish virgins!

Oh, oh.

Mr. Diefenbaker:

I do not know what that means but perhaps my hon. friend might interpret it.

Mr. Pearson:

Read the Bible.

Mr. Diefenbaker:

Really on the face of it, it seems to depart somewhat far from dealing with natural resources. I will now continue to read what my hon. friend said B.C.- before convention, that is very important-and A.D., after defeat. I continue:

The United States now has a great stake, in terms of money alone, in its northern neighbour. That is only one reason, but an important one, why it has an interest in Canada's prosperity; so that your investment will be a profitable one. This will depend, however, to a large extent on our ability to export, for we cannot begin to consume what we produce.

I ask my hon. friend the Leader of the Opposition what his party did during that period of 22 years in which they were in power to increase exports to the United States?

Mr. Pearson:

Read the figures.

Mr. Diefenbaker:

I continue:

Our prosperity, even our economic stability, depends on the maintenance of a high level of exports. But there are difficulties and dangers ahead and these are largely concerned with our trading relationships with you-

That is with the United States. I continue:

More specifically, they arise out of our growing unfavourable balance of trade across the border and out of your policies in disposing of surplus agricultural products which affect our competitive position in traditional markets.

Mr. Speaker, again I remind hon. members that these remarks were made on July 13, 1957, following the election of June 10. They pour ridicule on us because we endeavour to bring about a situation to expand trade and also to meet that detrimental situation whereby, so far as the United States, is concerned, our exports are but an infinitesimal part of the total amount of the imports from that country. My hon. friend, the Leader of the Opposition went on to say:

As to the first, the figures will explain our anxiety and our grievance.

This was the grievance voiced on July 14. There was no grievance today in this house. I continue:

Last year, our country with less than one-tenth of your population, bought $4,167 million worth of goods from the United States; more than was purchased by the whole of South America. We are by far your largest customer and we pay our bills in cash. In return, you bought $2,819 million worth of Canadian products, leaving us with an adverse trade balance of $1,348 million. Capital imports, I know, have helped to bridge that gap, the extent of which was caused, I admit also by the very speed and character of our growth, which required vast quantities of capital goods.

The following are the important words:

But this present unfavourable trade balance cannot be allowed to continue-

That is exactly what we have been saying but they say, "When you spoke up, they knocked you down," because the attitude apparently is that it is something to gloat over when Canadians stand up for what is proper and right. I can only repeat what I said before, that almost every United States newspaper with only two or three exceptions editorially approved of the need of something being done in order to bring about the reestablishment of a reasonable equity as between our exports and imports.

It has been the same ever since 1921. I am not going into those figures now. It was the same in 1922 and again in the month of June, 1930, when the United States placed a tariff against the imports of Canadian agriculture. In the past when they have had a surplus they have disregarded our situation. I am not blaming them for what happened

Suggested Resignation of Government then, but I am saying today, and as a Canadian I believe it must be said over and over again, that Canadians have the right to say, joined in defence, joined in the preservation of freedom, each in a position where its own survival depends on the other. The United States must in the future to a degree which has not been practised in the past remove those barriers which have placed Canadians in the last 20 years in the position of being the most wide-open and available market in the world while the United States market has been closed to us.

I continue. Mr. Hellyer said:

Let's get tough.

What did the Leader of the Opposition say?

Unless our exports to the United States can be increased, Canada will obviously have to take some kind of remedial action.

I ask my hon. friend to tell us what is that remedial action? He has something in mind. It was kept under cover for the 22 years they were in power. Let us hear about it now. What is the remedial action? They criticize us for any step that we endeavour to take. The commonwealth received little attention during the days that they were in power. Indeed, in all the speeches of my hon. friend as secretary of state for external affairs there was seldom even an oblique reference to the commonwealth.

Mr. Pearson:

Childish.