March 17, 1922

CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

My hon. friend is entitled to that bit of encouragement.

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LIB

George Perry Graham (Minister of Militia and Defence; Minister of the Naval Service)

Liberal

Mr. GRAHAM:

That is a very important distinction.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

Let him have it. But what does he say about the Government that with this line arranged for, with the charters standing, chooses deliberately to build a third line, paralleling the two existing lines, at its own cost in part and entirely on its own authority. Why, Mr. Speaker, there may be some room for argument that this country could support, and would support, two transcontinental lines; but when the Laurier administration embarked upon the construction of the Grand Trunk Pacific they embarked upon a project which committed this country to three transcontinental lines, and I cannot find appropriate parliamentary language to properly describe such an act.

Let us see if that is an over-statement. The charter for the line from Edmonton to Vancouver was granted four years prior to the Grand Trunk Pacific project. It is true it was built under another charter;

but the right to build was there. From Dauphin, Manitoba, to Edmonton, the charter was granted one year prior to the Grand Trunk Pacific project. From North Bay to Port Arthur the charter was also granted one year prior to the Grand Trunk Pacific project. There is another very extraordinary circumstance which shows that the administration of that time had a belief in the idea that three transcontinental railways could be supported by this country, because the charter for the line from Montreal to French river was given by that administration after the Grand Trunk Pacific project had been launched.

Well, construction goes on, guarantees are given, and millions of dollars of public money are placed at the disposal of the promoters of these railways. Then 1911 comes along, and with construction largely carried out, governments everywhere committed, the moneys in the hands of trustees-all this done, it is now suggested that we ought to have stopped. If ever there was something which goes beyond eleventh-hour repentance, something which occurs just before the end of everything, you have it in that suggestion.

I wonder if some of the eminent legal gentlemen on the other side will later give us the benefit of their views. If they do, we shall perhaps be told in what manner the Dominion could legally have interfered with a matter directly involving property and civil rights; involving the issue of bonds, the placing of money in the hands of trustees, the liabilities of provinces and even of the Dominion itself. But the suggestion could not have been intended to be taken seriously. The hon. member for Pic-tou says that because we did these things we are responsible for everything. But what would he have had us do? Did he want the settlers who had been induced to come to this country left without the transportation service which they were assured they would have, left without any way of getting out their crops or getting in their food supplies? What would he do with regard to the many villages and communities which would be without railway communication? What would he do with the commitments here and there and everywhere? What would he do with the large government guarantees, Dominion and provincial? He knows very well that there was just one thing to do: to carry on as best we could; to make the best of the exceedingly bad situation that had been created for us.

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The ho:n. member says that we were responsible for the loan to the Canadian Northern. Every cent of the loan of 1911 went into the property, and the same is true of the loan of 1914. We did not want to take the baby; the government did everything it could to get rid of it. Not until everybody in Canada was sick and tired of putting up funds for private companies were the lines taken over. Is it not better, if we have to spend money in connection with foolish and improper undertakings, that we should at least know where every cent is going? Is it not better that if they are a success the country should get the benefit of it? Is it not better that the Canadian taxpayer should, to use a commonplace expression, get a "run for his money"?

Well, we are to blame for another thing, the hon. member says; we are to blame because the government consented to arbitration. I will tell the House very frankly that my own view as expressed in the report to which reference has been made was that there was no equity in the Canadian Northern. I took that view, and I still hold it. But the government were in this position: they were entering into possession of a property, and the usual thing when governments in civilized countries enter into possession of somebody else's phoperty is to have a free and independent arbitration for the purpose of finding out what that property is worth. The usual course, therefore, was followed in this case: three independent arbitrators were appointed. I have not heard any attack made by hon. gentlemen opposite upon the character, the standing, or the ability of any one of these arbitrators; nevertheless we are blamed because we carried out an award made by a board composed of men of the highest standing.

Then, we are frightfully to blame, the hon. member suggests, because we did not know that the Grand Trunk had an American mileage. Is it not a tremendous discovery which the hon. gentleman has just made-that the Grand Trunk has an American mileage? Well, my hon. friends will have no difficulty in carrying out the project if they approach it along the lines of the report which has been made. That does not call for government operation as talked about by the hon. member for Pic-tou. It does not mean that this Government will report to or take orders from the Washington government. It simply means that company operation will be carried on

in respect of the lines in American territory and reports made to the Washington authorities with regard' thereto by that company. The only difference is that company would be owned not by private, English shareholders but by the people of Canada generally. I do not see anything sinister in this. I am sure that so far all the trouble in this regard has been manufactured by my hon. friends. If they stick to it long enough; if they talk about it loud enough, I dare say they may find a sympathetic reception on the part of some across the border, but if there is trouble, the country will know how and whence it came. Is there any trouble in connection with the ownership of the Soo line by the Canadian Pacific Railway Company? Why, the Soo line gets along just as well to-day, owned by Canadians, as it did when owned by Americans. It is the same old company; reports are made in the ordinary course, and there is no trouble. The Michigan Central running through Ontario has no trouble in Canada, nor have I heard of any difficulities arising in connection with Mr. Hill's lines in the West. I have never heard any civilized country say that simply because the whole of a people of a very friendly neighbouring country are interested in an enterprise operating partly in their territory, the people of that neighbouring country shall do no business with them. But in the minds of these gentlemen who approach the subject with so much sympathy, this circumstance is a terrible bugaboo. I only hope that what I have heard is true: that a fair chance will be given national ownership.

But I wonder who is reading the situation most correctly? The Montreal Star has had an editorial upon the subject,- and the Montreal Star and Montreal Gazette are two papers referred to by my hon. friend from Marquette as being strangely sympathetic with the new administration. As to these papers we have the suggestion coming from governmental benches- yes, from an old member of standing-the suggestion of loaves and fishes. It is certainly a suggestion I would not make. Yet one hon. gentleman made it. I wonder why. I wonder what kind of a loaf and what kind of a fish that is. I wonder what kind of a monogram it would have upon it. I do not think any hon. gentleman on this side of the House at any rate, yes, or on the other, would have much difficulty in guessing what cabalistic lettering would appear upon them. Well, the idea of the Montreal

The Address

Star, in its editorials, was plainly that the opportunity was an opportunity to prove the absolute impossibility of governmental ownership in this country, and if my friends are sincere in what they are about to undertake I would counsel them not to have very many gentlemen speak along the lines followed by the hon. member for Pictou, unless they want to be put in the position that they' are absolutely and entirely sure that trouble will be made in the United States, so that they will have some excuse for getting out of the obligation which they owe to the people of this country.

There was another thing said by my hon. friend, the Prime Minister. He blamed us on this side of the House for our unsympathetic handling of the- Grand Trunk Pacific. I wonder what on earth he meant by "unsympathetic" handling of the Grand Trunk Pacific. Good heavens, Mr. Speaker, this country was being bled white to look after that baby! Did he want millions more thrown away to keep it going? How much more ought we to have given it? Mr. Speaker, there are some projects so far removed from reason that the most reckless expenditure would be insufficient to save them. Some day perhaps we may have an asset in the Grand Trunk Pacific; but we have not to-day. Yet we are charged with being unsympathetic. We here are only interested, and I think I can speak in this connection for every member on this side of the House, in seeing that the property of the people of Canada gets a fair chance. We know that it is so easy to stifle and kill the project that frankly we are afraid a good deal will be made of the remarks of the hon. member for Pictou. In answer to his remarks to-day I read calculations given to the House by the Minister of Finance at the inception of the Grand Trunk Pacific project Now our vote last year on that account, if I remember rightly, was $26,000,000. Yet the whole cost of the undertaking, according to the figures given by the Minister of Finance at its inception-I am sure they were not his own figures but were supplied him by the railway-was to be $13,000,000, just half the necessary vote taken in the 9 p.m. House last year. It is wonderful what railway people can do with figures. I wonder, Mr. Speaker, if you have read the award in the present Grand Trunk arbitration. If you have read it you will have some idea of what railway officials can do with figures. As to

the question of figures used by the Grand Trunk, some very harsh things have been said, but I prefer to take what their own arbitrator-not the arbitrator appointed by the Government or the third arbitrator- but what their own arbitrator says. On page 58 of the Award-I will cut the reading down as much as possible-he says:

In 1913 the operating revenues were improperly increased apparently in order to justify the declaration of a dividend on the three series of preferred stocks, a full dividend on. the first and second, and half on the third. Then came a period in which the London management waa anxious to induce the Canadian Government to take the burden of the Grand Trunck Pacific off its back, on the ground that obligation to run and finance the Pacific Road might lead to the bankruptcy of the Grand Trunk. That led the London management to understate their operating revenues and charge the Audit Office Fund during the years 1915, 1916 and 1917 with an aggregate of nearly eight million dollars that should have appeared as additional revenue.

In 1919 and 1920, when the sale of the road to the Government was being faced as the best course, manipulation of the accounts was directed to making the financial condition of the road seem better than it was.

Yes, Mr. Speaker, wonderful things can be done by people who juggle figures and who do not seem to care very much as to the accuracy of the reports they sign.

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LIB

George Perry Graham (Minister of Militia and Defence; Minister of the Naval Service)

Liberal

Mr. GRAHAM:

Hear, hear.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

The hon. gentleman says "hear, hear." I take it that he agrees entirely with my remarks.

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LIB

George Perry Graham (Minister of Militia and Defence; Minister of the Naval Service)

Liberal

Mr. GRAHAM:

Oh, certainly.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

I take it that he has not in view, perhaps has never heard of, the statement that was made use of in the campaign in West York in connection with the Grand Trunk employees, a statement that was used well in the interests of my hon. friend's party. It was to the effect that a promise had been given Mr. Kelley, either that he would be left in control of the Grand Trunk system, that the Grand Trunk system would not be taken over, or else that he would be put in charge of the National roads. I wonder if that is what my hon. friend was thinking of when he said "Hear, hear,"-if he meant that so far as he was concerned he was going to see that no gentlemen that had anything to do with the deception worked on the people of this country by these reports shall have anything to do with the management of the people's roads. I take it that that is what his "Hear, hear" meant. We still hope, Mr. Speaker that the chance given will be, not a chance to make certain failure of the roads, but

The Address

a chance which will enable the country's properties to be successfully administered by trustees on the country's behalf. .

I was very much pleased that I had the honour of being present at the impressive debut by the hon. Minister of Justice (Sir Lomer Gouin) the other day. I heartily congratulate him on his wonderful success. It is a grand thing to have heard him, the big man from Quebec, in his first deliverance. Hon. gentlemen who heard him cheered him to the echo and I agreed with them.

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LIB

George Perry Graham (Minister of Militia and Defence; Minister of the Naval Service)

Liberal

Mr. GRAHAM:

He may be right nevertheless.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

He made a

great speech. My hon. friend says he may be right, but I am not going to tell my hon. friend what I was thinking of at that particular moment. But I really think, Mr. Speaker, that the hon. gentleman although great in admitted ability, did not cover the questions in this debate at all. Take for example, his statement that my right hon. friend insinuated improper motives to the hon. * gentleman in the last election, saying that he was influenced by the great interests of Montreal. It is quite true that he was in the same canoe with these great interests. It was quite true he was the most dexterous steersman of that canoe, and handled it beautifully, but none of us on this side of the House would, for one minute, insinuate that the hon. minister was merely a tool of any big interest. He is too big a man. He is a big interest himself. Who is there bigger in Montreal than the hon. Sir Lomer Gouin? Who is there more connected with interests in Montreal than that hon. gentleman-and nothing can be said against him on that account, on the other hand, it is very much in his favour. I think those on the other side have been very wise in having associated with them a man of the hon. minister's brilliancy, but no one on this side of the House insinuates that anyone was pulling him by the nose. We think the operation was rather reversed. However, the hon. minister was wrong in some things. He was wrong when he said that my right hon. friend's reference to him as master of the situation was simply for the malign purpose of injuring Quebec and keeping alive feelings in that province which ought to have disappeared long ago. If the hon. minister would only give my right hon. friend credit for ordinary intelligence he would see that the suggestion was ridiculous. What in the name of common sense has he to gain by keeping alive

in Quebec the present feeling against him? Would anyone but a lunatic adopt such a course? I have heard him called all sorts of names by gentlemen on the other side, but never heard him described as a lunatic. The hon. gentleman is simply wrong. Does he say that these great newspapers, the Montreal Gazette and the Montreal Star, are enemies of Quebec? Take the newspaper that worked up that roorbach about so many Montreal people losing their jobs and work being sent to Toronto-does he think that paper is inimical to Montreal?

I would hardly think so. Let him look at any of those papers and say what they think as to who is the master mind. Let us see what the Gazette, which is so friendly to the Government says about it. I read from the publication of December 26, where I find the following:-

When Mr. King Jilted Quebec, and sought a union with the West there was joy in Toronto, but the rejoicing was premature as J. J. Morrison and Henry Wise Wood forbade the acceptance of the Liberal Leader's general proposal, and now he must turn for consolation and support to Quebec, the province he discarded. Mr. Crerar is here but will not enter the cabinet. He is willing but cannot deliver any substantial support Mr. Hudson has also returned to the Independent Liberal class, and he may follow Mr. Crerar's example. Political chaos reigns here, and with the failure of Mr. King's attempt to displace Quebec by western support there threatens to be instability in federal affairs until the people have an opportunity to revise their judgment of December 6th., Mr. King cannot lead, he must be led.

This is the extract from the paper friendly to Montreal and to Quebec.

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LIB

Ernest Lapointe (Minister of Marine and Fisheries)

Liberal

Mr. LAPOINTE:

Does the hon. gentleman think that Tom Blacklock, who writes these articles, is a friend of the Government?

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

I do not know who writes it, but I know it is printed in the Gazette, and I db know above all things that the Gazette is loyal to Quebec.

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LIB

Ernest Lapointe (Minister of Marine and Fisheries)

Liberal

Mr. LAPOINTE:

It is the paper of the Tory party.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

Well let us-see about that. This article continued

Mr. King was prepared to betray his party and to discard his policy to secure the Progressives, while Mr. Crerar was prepared to eliminate his party; but neither party would submit to betrayal. Sir Lomer Gouin and Senator Dandurand arrived here Friday night and "spanked" Mr. King.

I do not believe that the Minister of Justice did spank the hon. Premier, but I

The Address

will just draw attention to this one thing, and I am only doing it for one purpose.

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LIB

Ernest Lapointe (Minister of Marine and Fisheries)

Liberal

Mr. LAPOINTE:

Hear, hear.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

And that is that it is quite idle for hon. gentlemen to think that because any hon. gentleman happens to come from Quebec nothing can be said against him without the charge coming from that side of the House that we are endeavouring to create disunion between the provinces. The situation is an intolerable one. Was the Gazette article writen to injure Quebec? My right hon. leader in his speech on the Address merely referred to the editorial in Le Soleil and read it without comment, and, because he read an editorial of a leading French paper without comment, the Prime Minister assumed one of his severe oratorical expressions-he can be severe-and warned my hon. friend that he had better be careful how he proceeded with this kind of thing. Does it come to this, that a French newspaper cannot, loyally to Canada,1 be read west of the Ottawa river? I would not have thought so.

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LIB

Ernest Lapointe (Minister of Marine and Fisheries)

Liberal

Mr. LAPOINTE:

Who says so?

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

I will ask my hon. friend a question. What was said by my right hon. leader on this most deplorable question beyond reading that reference? That is all he did. If the mere reading of it caused that outbreak from the Prime Minister, is there any need for my hon. friend to ask that question? There ought not to be, and he knows there is none. I point to this merely for the purpose of showing that my leader can have no reason for following the course that, without the slightest possible foundation of fact, has been ascribed to him. You know, Mr. Speaker, it all started in an imaginary speech referred to in the Globe, and supposed to have been delivered by the leader of the Opposition. That was copied in all parts of Canada; and the very moment that it came to the attention of the leader of the Opposition, he denounced categorically ever having made the speech, and he asked the Globe to give the reference. He has asked for it many times; hut although that information was asked for a year and a half ago, the information has never been given. The speech was never made. There is a controversy going on in Ontario at the present time between the Globe and the Farmers' Sun. The issue seems to be as to who is the worse liar, and I do not think they have

yet settled it to their satisfaction. It may be that they both win; but I am quite sure that the Globe will make the Farmers' Sun work hard. This party has not that enmity to Quebec which is suggested. Was the campaign run upon that line? Everybody knows that it was not. But, with some people, any old thing will do, and the great problem of the Government at the present time, as disclosed by the speech made by the hon. member for Pictou (Mr. Macdonald), is to kill politically the leader of the Opposition. I would like to tell my hon. friends opposite that they cannot do it.

The Minister of Justice confuses what was said by the leader of the Opposition in his references to him. He seems to object to references to himself. Why, that was mentioned in the speech of the member for Pictou as evidence of ill-feeling, bad blood, on the parr

of the leader of the Opposition.

The leader of the Opposition picks out for reference the most prominent men connected with the campaign. He has referred often enough to the Prime Minister, but simply because he happened to refer to the hon. member for St. Antoine (Mr. Mitchell) and to the Minister of Justice, why, of course, it was insult to Quebec that he meant. My hon. friend knows that is ridiculous; everybody knows it is ridiculous; but I suppose it will continue. The hon. member, however, mistook the object of my right hon. friend's remarks. My right hon. friend was not attacking the Minister of Justice; he believes in the statement made by the Minister of Justice; he believes that the stand taken by the Minister of Justice is correct. He still believes, what he has always preached and preached just the same everywhere, that this country requires protection. Was that an attack made upon Quebec by the hon. member for Marquette, when he dealt with the same question and at greater length than my right hon. friend did? He was attacking a policy of the Minister of Justice. My leader is not attacking the fiscal policy of the minister. I think it may well be said that while my leader went down to defeat, the principles for which he fought were principles which were, in the large, endorsed by the majority of the people of this country. Why, what is said by the Minister of Justice might just as well appear in our platform. He believes in proper protection for the boot and shoe industry, and I think he is right in that be-

The Address

lief. He believes in proper protection for the Quebec worker. We know that the Quebec worker requires protection, and we think the minister is right in that regard. In his final declaration, he says that he still believes in the Laurier-Fielding tariff. So do we, except that it is a little higher than ours, and except that certain changes have been made in the commerce and business of this country which to-day render certain items unnecessary. I say that it was higher than ours, and I will give my hon. friend the figures. The first complete year of the Laurier administration, 189798, the average ad valorem rate of duty on dutiable imports was 29.7 per cent, and on all imports, dutiable .and free, 17.5 per cent. In 1909-10-that was after the second revision-the duties amounted to 26.8 per cent on dutiable imports, and to 16.5 per cent on total imports. The duties collected in the years 1920-21 on dutiable imports amounted to 21.2 per cent, and on total imports to 14.5 per cent.

The truth is that the present tariff is considerably lower than the tariff to which the Minister of Justice proclaims his allegiance. Let me take items which my hon. friends to the left would be more particularly interested in. In 1910, the year before the Laurier administration went out of power, the average duty on agricultural implements was 20.2 per cent. Under the reciprocity pact if passed, that duty would have been cut to 17.3 per cent. The present average duty on agricultural implements is 14.6 per cent. So, again, my hon. friend is entirely mistaken when he thinks that there is any attack made on him because of his fiscal policy. As a matter of fact, it is entirely, in principle, consonant with our own. We think the duties are too high; some of them, we . believe, could come down. On the other hand some of them are too low. We believe that at the present time, with the tremendous amount of unemployment we have, it is little short of a crime for this country to be importing over $200,000,000 worth of goods that can just as well be produced at home.

Something is said about reciprocity. I wonder if it would not be possible some day to sit down and approach this question purely from a business standpoint. The suggestion in regard to reciprocity is that we can buy more from the United States and that they would take more from us. Well, I do not know any way in which we can compel them to take any more from us at present. I think there was a great

deal in what the hon. member for Marquette said, that, while he was pleased to see the Minister of Finance go to Washington, at the same time the visit was ill-timed. Of course it was ill-timed, but was it made for the purpose of securing reciprocity? Or was it made for the purpose of influencing gentlemen to my left? Are we not buying enough from the United States?

There is one argument made by my hon. friends to my left, an argument which I have heard more than once and which has something to recommend it if the circumstances will justify it. They say that if you do not buy you cannot sell; you can only do business if you are ready to create a credit, so that the outsiders with whom you want to do business may be in a position to trade with you. There is a good deal in that, if you have not already established credits. But you can establish credits in many ways. For example, you can establish credits by importing coupons which represent your interest payments, just as much as you can establish credits by importing American automobiles. It is just the same. I wonder if hon. gentlemen realize that this country to-day is importing coupons in the neighbourhood of two hundred millions a year. Commitments outside, moneys that have gone to build the Grand Trunk Pacific, the Canadian Northern, and the like, the moneys borrowed by our municipalities, here, there and everywhere and by governments, and the moneys borrowed by industrial companies outside the country, amount to something like $200,000,000 a year. It used to be calculated at $180,000,000; but it is now said to be nearer the figure I have given. Have you considered what that means, what a tremendous amount of buying credit that represents, that is taken out of the country every year to pay- commitments in interest, profits, etc.? You must begin your calculations with that in mind.

There is another thing for my hon. friends on my left to consider. They have more than once pointed out, in referring to the great success of the United States, that they have no duty on shoes and on several other things. The United States had very large duties on everything that they sought to manufacture, until they captured the whole of that manufacturing market, and when there was no necessity for having a duty on anything it was taken off. It will be agreed that the United States has done pretty well. It is a great country with a marvellous outside trade. For the fiscal year 1869-70 the

The Address

United States imported, per capita, $11.77; in the year 1879-80 she imported per capita $12.57; in the year 1889-90 $12.28, in the year 1900-1 she imported per capita $10.23. Then, during the war, every one got extravagant; every nation was spending lavishly, and the great United States, in the year 1920, as against $10.23 imported in 1901, imported at the rate of $47.22 per capita. At the sight of this that great financial colossus becomes alarmed and you have the Fordney Bill.

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PRO

Thomas Alexander Crerar

Progressive

Mr. CRERAR:

Is not that due to the fact that the prices of goods have doubled, and in some cases trebled?

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

The importation has increased four times; but if my hon. friend waits, I think he will agree that the prices have not had so much to do with it.

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PRO

March 17, 1922