March 10, 1924

PRIVILEGE-HON. MR. SINCLAIR

LIB
?

Mr. J@

I

would like to ask the Minister of Railways (Mr. Graham) if there is any truth in the report current in the papers that the government does not intend to take any steps to prevent the full operation of the Crowsnest pass agreement in July next.

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LIB

George Perry Graham (Minister of Railways and Canals)

Liberal

Hon. G. P. GRAHAM (Minister of Railways) :

The action of the government will

be made known in due course. I am not in a position to state its attitude to-day.

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ORDER-REFERENCES TO THE SENATE


On the Orders of the Day:


LIB

George Perry Graham (Minister of Railways and Canals)

Liberal

Hon. G. P. GRAHAM (Acting Prime Minister) :

Might I call your attention, Mrj

Speaker, to one thing? I seldom, if ever, call any speaker to order so long as he keeps within reasonable distance of the rules of debate, but I fear that in the debate on the Address now in progress we are getting close to the violation of a rule in referring, as has been done frequently in this House, to what has taken place in the upper chamber. I think that is not according to the well-known practice of the House of Commons. I remember being called to order on one occasion in this House for referring to what was said in the upper chamber in these words: "Somewhere, some person has used this language," I was called to order for quoting from a debate

The Address-Mr. Logan

in the Senate. I think I need only call attention to the rule. In order to maintain good feeling between the two Houses of Parliament and respect one for the other, we should not refer to the debates taking place in the upper house.

UNITED STATES TARIFF ON WHEAT On the Orders of the Day:

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CON

William Garland McQuarrie

Conservative (1867-1942)

Mr. W. G. McQUARRIE (New Westminster) :

Might I ask if the government

contemplates taking any action, by way of retaliation or otherwise, in regard to the proposed increase in the United States tariff against Canadian wheat and wheat products?

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LIB

George Perry Graham (Minister of Railways and Canals)

Liberal

Hon. G. P. GRAHAM (Acting Prime Minister) :

"Retaliation" is a bad word to use in business, if the object of trade is to make a profit. I would not like to say that the government had even been considering retaliation.

HOME BANK INVESTIGATION On the Orders of the Day:

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Right Hon. ARTHUR MEIGHEN (Leader of the Opposition):

Will the acting leader of the House say whether or not anything has been done towards amending the commission in respect of the Home Bank inquiry, pursuant to the promise of the Prime Minister last week?

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LIB

George Perry Graham (Minister of Railways and Canals)

Liberal

Hon. G. P. GRAHAM (Acting Prime Minister) :

I will look into the matter and give my hon. friend a reply tomorrow or the next day.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Will the leader of the

House lay on the table the amended commission?

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LIB

George Perry Graham (Minister of Railways and Canals)

Liberal

Mr. GRAHAM:

I have no objection to

doing that when the commission is amended.

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THE GOVERNOR GENERAL'S SPEECH

ADDRESS IN REPLY


Consideration of the motion of Mr. Kelly for an Address to His Excellency the Governor General in reply to his speech at the opening of the session and the proposed amendment thereto of Mr.. Sutherland, resumed from Friday, March 7. Mr. HANCE J. LOGAN (Cumberland): Mr. Speaker, joining with others I desire to congratulate the mover (Mr. Kelly), and the seconder (Mr. Lapierre) of the Address. We have known the member for Nipissing (Mr. Lapierre) for a long time; we know how eloquent he is. I hail in this House a fellow Nova Scotian in the member for Cape Breton North and Victoria (Mr. Kelly), who in moving the Address gave us one of the most businesslike speeches we have listened to for some sessions. I am going to speak to-day in perhaps a rather candid way. I agree with my hon. friend from St. Lawrence-St George (Mr. Marler) who told us on Thursday that speeches in this debate should be rather in the direction of advice to the government of the country, and should reflect the views of the constituencies which the speakers represent. I propose this afternoon, in a most humble way, to give some advice to the government of Canada particularly in reference to the Maritime provinces to which I have the honour to belong. The Speech from the Throne itself, as a whole, is one which commends itself to all well-wishers of Canada. If previously we had a chart we now have a definite programme to deal with at this session. Speaking as a Liberal I regard the Speech from the Throne as one calculated to give us fresh hope for the welfare of this country. Undoubtedly the speech is long, consisting as it does of twenty-one or twenty-two paragraphs, but every paragraph is important in view of the present condition of affairs with which we have to cope. I shall refer particularly, Mr. Speaker, to one or two of these paragraphs in passing. Paragraph 4 is thus worded: My ministers believe, however, that in virtue of economies already effected they will, when the present financial year closes, be able to announce to the country that for the first time since 1912-1913 the national budget has been balanced. They are further of the opinion that when the budget for the ensuing fiscal year is introduced it will be found that the relation between public revenue and public expenditure is such as to justify some immediate reduction of taxation. The people of this country will welcome this declaration of an early reduction in taxation with a great deal of pleasure. We know that the war was expensive. We were quite willing during that great struggle to bear our burden. But the taxation of this country at the present time-I refer particularly to the direct taxation-is, in my humble judgment, too high, and is not in the best interests of the country as a whole. In the next paragraph the government announce that the government propose -to reduce the cost of the instruments of production in the industries based on the natural resources of the Dominion, thereby aiding materially in the development of our natural resources, and, through cheapened production, effecting a diminution also in the cost of living. That is a good sound Liberal principle, a doctrine which we desire to preach and to carry out. The wealth of Canada can never be built up with exotic industries. The great The Address-Mr. Logan wealth of Canada depends upon the soil, upon the sea, upon the forest, upon the mines, and whatever we can do to lessen the cost of production in connection with these great natural resources, the richer our country must become. This doctrine is particularly pleasing to one from Nova Scotia, because there we not only have the important industry of agriculture but we also have the great mining industry, we have the lumbering industry, and we have the great fishing industry. A reduction in the cost of production will be beneficial to these industries as well as to agriculture. One would think sometimes when an industry affecting a few hundred men is getting nervous, that there were not other large industries in Canada which should be considered. I read an address the other day delivered by my hon. friend the member for Lunenburg (Mr. Duff) before an organization in this city in which he made this statement: One hundred thousand of the inhabitants of Canada are dependent upon the fishing industry. What in the name of heaven has protection ever done for the fishing industry of this country? We have in Nova Scotia probably nearly one hundred thousand people directly or indirectly dependent upon the coal mining industry. What has protection ever done for the coal mining industry of this Dominion? I will devote some little time later on in my address to a consideration of the question of the duty upon coal. I want to remove from the minds of the people of Canada the idea that we have any protection upon the production of coal. Then, too, what has protection ever done for the lumbering industry of the Maritime provinces, or for that matter what has it ever done for the agricultural interests of these provinces? Forty-five years have gone by since great hopes were held out to us. We were promised in that distant past that the National Policy would build up great industries in the Maritime provinces, that smokestacks would arise in all parts of the country, and that incidentally there would be a great market for the products of the farm. We have waited for forty-five years for this prediction to be fulfilled. I defy anybody in this House, from the leader of the opposition down, to show where high protection has been of benefit to the provinces of New Brunswick, Nova Scotia and Prince Edward Island. Why, Sir, the two industries in my constituency that have really weathered the storm, so to speak- have weathered the hard times that followed the war-are the woollen industry in Oxford and the boot and shoe industry in Amherst. They were prosperous industries away back in the seventies before we had any National Policy; but some other industries particularly those which have been built up on a false basis were the ones to suffer first when depression came a few years ago. Mr. Speaker, we have had it stated here there is prosperity in Canada. The leader of the opposition denies it, but I prefer to take the language of a man who occupies a very important position, namely R. S. White, editor in chief of the Montreal Gazette, the sanest Conservative newspaper in Canada. In his opening remarks in the book published this year by the Gazette company containing a commercial and financial review of the year 1923 he says: Surveying the state of trade in Canada in 1923, and all that pertains to the material prosperity of its people, there is much to encourage and little to dispirit. Taking the whole of the Dominion of Canada "there is much to encourage and little to dispirit," but we must admit there are districts in Canada which have not the prosperity which we would wish. Those districts are the prairie provinces of the West and the Maritime provinces. We on this side desire to endeavour to better conditions in these two parts of Canada, believing as we do that the strength of our confederation chain depends upon the strength of the individual links. It is of no use to try to build up a strong Canada when the Maritime provinces are weak or are not prospering. The Maritime provinces were considered most important to confederation, and they are most important. But if the conditions there are ijot what they should be, it behooves this government, or any other government in this country, to get down, as my hon. friend from Pictou (Mr. Macdonald) often says, to brass tacks, to find out what is the matter, and effect a remedy, if possible. Referring again to the general prosperity of Canada outside of these two parts thereof, it is a matter of congratulation that there has been and is considerable prosperity. I know it is stated that we are very heavily in debt, that we owe about two billions four hundred millions of money, but does it ever occur to you, Mr. Speaker, that three-quarters of that money is due to Canadians, and that the people of Canada actually receive every year from that loan about ninety million dollars in interest? The government pays in pensions to the soldiers thirty-three million dollars. That money is kept in Canada; it circulates again, and part of it comes back to the treasury of the country. We advanced to railways something like seventy-seven millions last year, but was that money sent out of the country? No, it was paid The Address-Mr. Logan



out to working men, to manufacturers, and producers throughout the length and breadth of the land. We gave subsidies to the provinces of twelve million dollars which is spent in the provinces and is coming back to us in an indirect way. We gave in grants for secular education, for highways and agriculture, eight million dollars, and in ordinary expenditure about one hundred and twenty-six million dollars, all spent in Canada, and paid to Canadians. Our total expenditure for the year was about four hundred and thirty-four million. I venture to state that out of that sum three hundred and seventy-five million dollars remained in Canada, that being one of the reasons why this country is as prosperous as it is to-day. If hon. members will look at the deposits in the savings banks and in the chartered banks of the country, they will find that in spite of the fact that the Canadians have one billion seven hundred millions invested in government bonds, the deposits in the chartered banks and in the savings banks have materially increased during the last year. Therefore, I think it can be very well said that, so far as the central part of Canada is concerned there is prosperity and considerable of it. What is the matter, may I ask, with the Maritime provinces? I am not going to speak of the prairie provinces, because there are so many honourable gentlemen from those provinces who know so much more about them than I do that it would be presumptuous on my part to speak about their difficulties. But I .do claim to know something about the difficulties of the Maritime provinces. What are the difficulties? What is the cause of this depression? Why is it that so many of our manufactories are idle? Why is it that the grass grows upon the streets of many of the seaport towns of those provinces? I give you the answer, Mr. Speaker, in two words. Tariff and transportation are the causes of it. We did not feel the effects of the National Policy as long as we had cheap transportation. We did not feel it so severely as we feel it now, so long as we could transport our manufactured goods from the Maritime provinces into the middle of Canada or the West at a low rate of freight. But, a few years ago, when the late government merged the Intercolonial with the commercial railways of Canada, and raised the freight rates to their present position, we found ourselves not only up against a tariff wall, but up against a freight wall, and between the two walls we are being squeezed to death. Let us stress for a moment what happened in the Maritime provinces. Hon. members will pardon me if I go over this matter, not at as great length as I have on other occasions in the House, but to some extent to follow up my arguments. In the Maritime provinces, let it be understood and known, before confederation we were a comparatively rich people. The trade per capita of New Brunswick, let me tell hon. members, in 1864 was almost double that of the provinces of Ontario and Quebec, known as old Canada, and the trade of Nova Scotia was materially greater than the trade of Canada. We owned at that time in Nova Scotia over three thousand ships which sailed out of our ports carrying products of the farms, forests, mines and fisheries. Where did they carry that produce? They earned it especially to the New England states and to the West Indies. We had at that time seventeen thousand of our sons upon the sea, manning ships, sailing through the different waters, particularly those which I have mentioned. We did not desire confederation. Let that also be distinctly understood; and so great an optimist as my very distinguished predecessor in the representation of Cumberland, that great Canadian, Sir Charles Tupper, Baronet, in 1864, three years before confederation, made the statement in the House of Assembly in Nova Scotia that the difficulties of confederation were insuperable. Shortly after that our men met in Charlottetown to form a Maritime union. While there a delegation from Upper and Lower Canada, the greatest galaxy of orators probably that ever sailed the Maritime seas-Sir John Macdonald, Hon. George Brown, D'Arcy McGee, Sir Hector Langevin, and many others of the great political stars of the country-came in upon our little convention, and said, "Walk into our parlor of confederation." The representatives of the Maritime provinces said, "No, there are too great difficulties." They said, "What are they? What are you afraid of." Our representatives said, "We are afraid, first that you will raise a tariff in this country that will by a retaliatory tariff interfere with our trade with that country which nature intended we should trade with, namely the New England states of America. If we are shut out from that market, where are we? Where is our market to come from?" With honeyed words, these orators said, "We will give you a new market to take the place of this market if you should lose it." Our delegates said to them, "How can you give us that market? You are too far away." They replied, "We will build you a means of communication, namely the Intercolonial, in order that if you The Address-Mr. Logan lose the United States market you will have a market equally as good in the central parts of Canada." Our people listened to them. They did not however take their word; they insisted it should be in the bond, and if hon. members will read section 145 of the British North America Act they will find set out in that section not only the promised building of the Intercolonial, but the reasons why it would be built, namely to secure the consent of the people of New Brunswick and Nova Scotia to enter confederation. For fifty years the promises given at the time of confederation were fairly well kept. As I say, we did not feel the effect of the National Policy or high protection in this country as long as we were able to send our goods from the Maritime provinces to the West. We used to boast in the young city in which I live that we sent over half of our products to western Canada. We send mighty little of our production to western Canada or to central Canada today, because we are shut out of those markets by the exorbitant rates that have been put into effect upon the railways of our country, the Intercolonial included. It is difficult for us to make the people of the rest of Canada understand our grievance in this matter, and it is difficult for them to know just how sensitive we are. There are many still living that remember the fight for confederation. It is still an unpopular subject to discuss. They know, and we, their sons, know that those solemn promises were made and we know that when the Intercolonial railway ceased to be a part of the constitution of this country and was placed among commercial railways of Canada and under the same rates of freight, a crime was committed against the people of the Maritime provinces. We are here to-day again to ask and demand that those promises made to us in 1864, 1865 and 1866, promises which I could repeat here for an hour if I cared to weary you, must be kept if we are to be at all prosperous and to become the part of confederation that we should be. Before leaving this subject, let me say that we in the Maritime provinces feel grateful for some things that have been done by this government. Under the old government, our whole road was controlled in Toronto by [DOT] Canadian Northern officials, men who had no sympathy with us and with whom we did not have much acquaintance. This government has changed that. We have had established at Moncton headquarters for the government railways in the Maritime provinces. They are in charge of a Maritime province man. The general superintendent is a Maritime province man, and equally pleasant is the fact that the general traffic manager is also a Maritime province man. We have, as I say, many things to be thankful for to this government for ameliorating the conditions that existed there four or five years ago. But I want to say now to the government and to the country that until conditions are made better as regards freight rates in the Maritime provinces, not from an economic standpoint altogether, but from a constitutional standpoint, we never can be satisfied in those provinces, and the government is bound to find that out. They found it out in the constituency of Halifax. They found it out in the constituency of Kent. Nobody in Halifax spoke about protection; even the hon. member for St. John and Albert (Mr. Baxter) did not talk protection in Halifax. He did not talk protection in Kent. Why? That would be ridiculous; nobody wanted to hear about protection. But what he did talk about was the grievances of the Maritime provinces, and the people feel those grievances and they must be remedied.


CON

Horatio Clarence Hocken

Conservative (1867-1942)

Mr. HOCKEN:

Did I understand the hon. member to say that those appointments to executive positions on the railways were made by the government?

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LIB

Hance James Logan

Liberal

Mr. LOGAN:

Indirectly by the government. They were made by Sir Henry Thornton and his board, and Sir Henry Thornton and his board were appointed by the government, so indirectly they were appointed by the government.

Having stated the reason for the depression in the Maritime provinces, let me suggest to you, Mr. Speaker, and to this House, some things that may bring back our prosperity. In the first place, we desire export trade. We are, it has been well said, the eastern wharf of Canada. But our export trade has diminished and does not bring to us that prosperity which we formerly enjoyed. Our natural market, besides that of the United States, is to the south of us. We looked, in days gone by, to the United States. That market is closed to us by the Fordney tariff. We then looked to central and western Canada for trade. That market is closed to us by the freight tariff. Where are we to look now? We are to look to the place where we always should have looked, namely, across water transportation to the countries to the south of us. Export trade with the West Indies and with South America should be encouraged in every possible way. Trade with those countries should be built up and looked after. During this winter I

The Address-Mr. Logan

ly as good as the American anthracite. So the old argument against bituminous coal, the old horror that the people had against the smoke, has passed away, and now we have a substitute for anthracite which is equally as good as anthracite.

We imported into this country -last year- and these figures are well within the mark-coal to the value of over $100,000,000. Of that about 14,000,000 tons was bituminous coal and 5,000,000 tons anthracite. In converting bituminous coal into coke, one-and-a-half tons of coal are required to make one ton of coke; so if we had desired last year to replace the five million tons of anthracite brought into this country with coke, it would have meant the mining of an additional

7.500,000 tons of bituminous coal in this country. Therefore if we had a policy by which this country could be made self-contained so far as coal is concerned, we would not only prevent the importation of 14.000,000 tons of bituminous coal each year, but by making coke to take the place of anthracite, we would add 7,500,000 tons more to that

14,000,000 tons, making a total of 21,500.000 tons of extra coal mined in this country to replace the American coal now imported. We are producing about 18,000.000 tons, >but if we had a proper coal policy we would add I repeat no less a quantity than 21,500,000 tons of coal mined in this country, which, at a price of $5 a ton at the mines would mean to the miners and operators and all those connected with the collieries, no less a sum than $107,500,000. In addition to that, we would have transportation costs paid to the Canadian National Railways, at say $4 per ton, amounting to $86,000,000, which would also be left in Canada to help the people of this country. Further, let me point this out. When we buy $100,000,000 of coal in the United States we have to pay in exchange, according to the rate that is being charged to-day, no less a sum than $3,500,000 of good Canadian money. That money goes in exchange, and might just as well be thrown into the sea. If you add the saving in exchange to the extra amount which would be spent in Canada for producing the coal and add to that again the cost of transportation which would be paid to Canadian railways, you get a total amount of good Canadian money which would be left here of nearly $200,000,000.

New, let me just refer again to discount on exchange. We pay it largely because we are buying so much from the United States of America. If we could reduce the amount we

fMr. Logan.]

are paying to the United States by that $100,000,000 which we paid for coal imported last year, in all probability we would have had par money in this country at the present time, because that would have helped to bring the imports and exports as between the two countries almost to the same level. If we did that we would save the exchange upon the whole purchase price of articles other than coal brought into this country from the United States, amounting to about $520,000,000. A rate of three and a half per cent on $520,000,000 would represent over $18,000,000 more saved to the country.

Now, Mr. Speaker, how is coal independence to be secured? One way of bringing about that most desirable result is to provide transportation for our coal at a reasonable rate. Last year the Mines committee of the House dealt with this matter. We listened to a great amount of very valuable information from different persons in reference to coal and the transportation thereof. We had before us transportation men, we had freight agents, we had traffic managers, we had all kinds of officials to advise us as to how we could handle coal. We also had before us some men who were not connected with any transportation company. For example, there was Mr. M. J. Butler, formerly deputy minister of railways in this country, who afterwards became general manager of the Dominion Iron and Steel Company, and subsequently was connected with the Armstrong-Whitworth Company, one of the largest concerns in the British Empire, a man of outstanding ability. He put before us arguments which I will not go into but will condense in this way: He said that instead of it costing us $9 or $12, which is the price to-day I believe, for transporting coal, from Edmonton or even west of that city to Toronto, coal could be put in Toronto for $4.57 a ton; that was he contended the actual cost of it. Mr. Butler was not a man picked off the street but a gentleman of knowledge and of standing in the country, and he put this statement in concise form before us. He, of course, made a condition that I submit is the crux of the whole matter, that if we are going to transport coal cheaply it must be done with proper equipment; it is no use trying to transport coal in broken-down equipment. Let me use his own language on that point:

To begin with let us eliminate the "know it can't be done type." Let us also eliminate the traffic officers who are making rates, predicated before using, small coal cars, box cars, old weak locomotives, with small train loads- or mixed train loads, with a few cars of coal to fdl up the tonnage.

The Address-Mr. Logan

It is I think clear, that the problem is one that demands that the equipment, from beginning to end shall be adequate to handle the tonnage at the lowest cost, but not at a price that the railway will suffer.

The argument that Mr. Butler makes is that we must provide the equipment in order to carry coal, and if we do that there will be a very material lessening in the cost. Therefore I submit to the government they should immediately appoint a commission, to consist of not more than three men, to make a report to the House as to the actual facts in reference to the cost of transporting coal. I am not talking about the question of income, of net revenue or gross revenue; I want to know what it actually costs to transport coal in Canada. It is almost impossible to get that knowledge from a railway official. One man may be charging $5 and it is difficult for him, perhaps, to explain the discrepancy if the cost is only $3. T1 en we must remember there is always a certain amount of hesitancy on the part of officials of competing companies to disclose information which might affect either corporation. What we want to do is to get down to the actual cost of carrying coal. Mr. Butler informed us that the Virginia railway is carrying coal at a very low rate, and upon that rate he has founded the rates which could be made by the railways of Canada. I therefore submit that a commission should be appointed to inquire into this matter. I would suggest that Mr. Butler be made chairman of the commission, and that a man from Alberta and a man from the Maritime provinces should be associated with him. This commission should be given power to go down into the territory of the Virginia railway where these rates exist-and, mark you, the grades there are higher than we have; do not forget that, the grades in Virginia add nothing to their advantage that I can seethe commission should also investigate the transportation costs of the Norfolk and Western, and the Chesapeake and Ohio, and the Illinois Central. In this way, I believe, it can be established what is the actual cost of carrying coal. I believe myself that if this inquiry be made it will establish that coal can be carried, from the Maritime provinces for instance to the province of Ontario, for not more-than $2 a ton at the very outside. We used to pay $1.60 six or seven years ago from the Cumberland mines, Nova Scotia, to Montreal. The present rate is $3.60 or $3.80. I want to know what the actual cost of carrying that coal is, I do not want it from any railway official, I want it from a man who is independent of all transportation companies and not concerned in the importation of 12

American coal. I believe we can do that by carrying out my suggestion; I believe we can get down to the very basis of the matter, get down to rock bottom, and find out what the transportation of coal costs. We shall then know what percentage ought to be allowed to our railwaj's in order to enable them to make a profit.

I am now going to refer to another matter which I think is important to the Maritime provinces, and indeed to all Canada. In the Speech from the Throne it is mentioned that it is proposed to make every effort to develop still further the policy of Canadian trade via Canadian ports. Last year the Minister of Finance brought down a measure giving ten per cent reduction on British goods when imported through Canadian ports. I shall not now discuss whether that policy was right or wrong. There is a strong argument being made by the woollen people of this country that owing to the present depreciation of English currency, the unemployment situation in the United Kingdom, and the lower labour rates- as a result in a word of the operation of the law of supply and demand-that we, perhaps, made a mistake at that time in lessening the duty on woollen goods entering Canada. I am not now going to discuss the pros and cons of that question. What I want to argue is that the government should go the whole way and confine the British preference to goods brought in through Canadian ocean or river ports. I may say, however, that even with the ten per cent reduction in duty a marvellous diversion of shipments has been made to Canadian ports since the last budget. I have not the figures relating to this matter at the present time, but I presume they will be presented to us when the budget is brought down. I cannot see myself, any reason why we should not follow the historic policy of the United States and confine this preference entirely to goods brought in through our sea and river ports.

In the Speech from the Throne a reference is made to the Imperial Conference and the Imperial Economic Conference held in London last year. I have listened with a great deal of interest to the speakers'who have so far taken part in this debate. I believe they all think as I do, that this is a serious time in the history of our country. Perhaps it would not be out of place to paraphrase in this connection, the motto which is given to students when striving to acquire a knowledge of typewriting: "Now is the time for all good men to come to the aid of the country." This is a good time for us to consider these matters seriously, because it is a serious time in the history of our land.

The Address-Mr. Logan

But I do resent one statement and that was the attack that was made during this debate on the Prime Minister of this country (Mr. Mackenzie King), for not taking part, in the recent general elections in Great Britain on behalf of Mr. Baldwin's preferential tariff. I want to point out that, in my humble opinion, such interference in the British elections would have been resented just as strongly as would interference by the British prime minister in an election campaign in Canada. What are the facts? The Imperial Conference was called by the Baldwin government. The Dominions responded to the call and journeyed to London. After many weeks of conference it was agreed by the government of Great Britain to extend the preference on certain products of the Dominion. This was promised from the Old Land to sister nations in this great British commonwealth, and I insist that these promises are binding upon the homeland. Are we to be told that the British parliament which, a few years ago, although the great majority thereof was hostile to home rule, carried out an undertaking of its predecessors, and thus kept faith with southern Ireland, is going to break faith with Canada and the other sister nations? I refuse to believe it. The Baldwin government entered into a certain agreement with the United States before they went out of power, extending the right of seizure beyond the three-mile limit. Will anyone suggest that the Ramsay MacDonald government is not going to carry out to the letter its agreement with its predecessors in office. Surely we are to be treated as well, at least, as foreign nations. If not, then our faith in future imperial conferences is going to be materially lessened. So far from the Prime Minister of the country being criticized for not taking part in that election, I am sure he should be praised for the silence he maintained.

I want to advocate before I take my seat that the railway department of this country -and I now direct my remarks principally to the Minister of Railways (Mr. Graham), to Sir Henry Thornton and his board-should endeavour to carry more produce and more exports to Canadian ports. I desire to make an argument, Mr. Speaker, upon this line, following the statutes that have been passed in this country. I think we sometimes forget about them. Let us go back to 1903 and refer to page 455 of the statutes of that year, being 3 Edward VTI, Chap. 71, an Act respecting the Construction of a Canadian National Transcontinental Railway. It ratified and confirmed the agreement between His Majesty and the Grand Trunk Pacific

Railway Company, which agreement forms the schedule to the act. The agreement recites among other things-and bear these words in mind-that the object is-

To secure the most direct and economical interchange of traffic between eastern Canada and the provinces west of the great lakes, to open up and develop the northern zone of the Dominion, to promote the internal and foreign trade of Canada, and to develop commerce through Canadian ports.

Section 42 reads:

It is hereby declared and agreed between the parties to this agreement that the aid herein provided for is granted by the government of Canada for the express purpose of encouraging the development of Canadian trade and the transportation of goods through Canadian channels. The company accepts the aid on these conditions, and agrees that all freight originating on the line of the railway, or its branches, not specifically routed otherwise by the shipper, shall, when destined for points in Canada, be carried entirely on Canadian territory, or between Canadian inland ports, and that the through rate on export traffic from the point of origin to the point of destination shall at no time be greater via Canadian ports than via United States ports, and that all such traffic, not specifically routed otherwise by the shipper, shall be carried to Canadian ocean ports.

Section 43 reads:

The company further agrees that it shall not, in any matter within its power, directly or indirectly advise or encourage the transportation of such freight by routes other than those above provided, but shall, in all respects, in good faith, use its utmost endeavours to fulfil the conditions upon which public aid is granted, namely-the development of trade through Canadian channels and Canadian ocean ports.

Section 45 provides:

The company shall arrange for and provide, either by purchase, charter or otherwise, shipping connections upon both the Atlantic and Pacific oceans sufficient in tonnage and in number of sailings to take care of and transport all its traffic, both inward and outward, at such ocean ports within Canada, upon the said line of railway, or upon the line of the Intercolonial railway, as may be agreed upon from time to time, and the company shall not divert, or, so far as it can lawfully prevent permit to be diverted, to ports outside of Canada any traffic which it can lawfully influence or control, upon the ground that there is not a sufficient amount of shipping to transport such traffic from or to such Canadian ocean ports.

Now, Mr. Speaker that was the statute confirming the agreement, with the company known as the Grand Trunk Pacific Railway Company. Upon that agreement the people of the country have spent directly and indirectly on the National Transcontinental railway, in assistance to the Grand Trunk Pacific and in other ways, probably three or four hundred million dollars. That is the basis upon which it was spent, and that provides that the trade should not be diverted from Canadian ports. Now, a large part of the country in which wheat originates is in the Grand Trunk Pacific territory and a very large part is in the old Canadian .

The Address-Mr. Logan

Northern Railway system territory. Let me refer to an act relating to the Canadian Northern Railway system. This is known as an Act respecting the Canadian Northern Railway system, statutes of 1914, page 135, being the Act 4-5 George V, Chapter 20. The act provides for aid by the government of Canada to the company by guaranteeing its bonds to the extent of $45,000,000. That is, the old Canadian Northern Railway Company. Many hon. members in this House will remember when the statute was enacted. That statute confirms the agreement annexed which is set out. Section 6, paragraph (a) provides as follows:

That at all times hereafter all freight originating on the lines of the Canadian Northern or on the lines of any of the constituent companies, or on any line or lines of railway now or hereafter owned, leased or operated by the Canadian Northern or by any of the constituent or subsidiary companies, their successors or assigns, shall, when destined to points in Canada, be carried over the lines of the Canadian Northern or of the constituent companies or over some other Canadian railway or railways (which term shall include the line operated by the Canadian Pacific Railway Company between Montreal and St. John) and that the through rate on export traffic from the point of origin to the point of destination shall not be greater via Canadian ports than it would be via United States ports; and that all inward and outward ocean traffic shall be carried to Canadian ports, and that the Canadian Northern and the several constituent and subsidiary companies shall not in any matter within their power or control directly or indirectly advise or encourage the transportation of any such freight by routes other than those above provided, but shall in all respects in good faith use their utmost endeavours to further the development of trade through Canadian channels and Canadian ports.

Mark you, according to the Grand Trunk Pacific agreement they must carry all goods not otherwise routed; but in the statute effecting the Canadian Northern it was not stated in that way, land they were compelled to carry freight on that line whether routed or unrouted, to and through Canadian ports. I did not know until a few weeks ago that the statute existed and I was rather surprised to find it. There are the facts. Does the government, with Sir Henry Thornton and his board, say that what this agreement imposed upon the company is not to be carried out? If the government imposed upon the Canadian Northern, when they were guaranteeing the $45,000,000 of bonds the condition that every pound of export freight should be carried out of Canadian ports, can this government which took over the Canadian Northern railway system do less than the Canadian Northern were compelled by statute to do?

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LIB

George Perry Graham (Minister of Railways and Canals)

Liberal

Mr. GRAHAM:

This government did

not take it over.

Topic:   THE GOVERNOR GENERAL'S SPEECH
Subtopic:   ADDRESS IN REPLY
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March 10, 1924