July 3, 1934

CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

The further question that has been raised as to the wisdom or unwisdom of there being a lessening in production is a matter that can always be discussed. It is a debatable question, and I am not going to say again what has been said so frequently, and what I did say in Winnipeg, that when a man finds himself producing in larger quantities than he is able to sell, and which he knows he cannot sell because the people who used to buy from him are supplying themselves, when fifty million acres that used to be sown to cereals were put out of production during the great war, and forty millions were added to production in the United States and ten millions in this country, it follows that as soon as the country that was out of production went back into production

Supply-International Wheat Agreement

there would be a corresponding loss of opportunity on the part of the United States and of Canada to sell their cereals where they had sold them during the war and immediately thereafter.

Just as soon as the devastation caused by the war was overcome and the communities . in question were able to sow and reap a harvest, just so soon was that market which Canada and the United States had theretofore enjoyed, limited to that extent.

So far as China is concerned we did have negotiations and we were offered, as I told this house many months ago, an opportunity to sell wheat to China on three-year terms,

I think it was; -but the conditions of government in China were such that we did not on that ground think it was desirable. But there was something more. They only desired to pay for the wheat a price equal to what our lowest grade of wheat would sell at, and we could not reduce the price of wheat in this country to less than forty cents a bushel in order to accept the Chinese offer, and we did not do so. The soft wheat of other countries found a more ready market than we were able to compete with. The price of wheat on the world market by reason of conditions that have been brought about partly by the agreement, partly by climatic conditions, partly by the acts of nature, and partly by grasshoppers, has been enhanced by these conditions, and I can only say to the hon. gentleman that it does appear to me to be-well, I shall not use the word I was going to use on this my birthday; I will only say that it does seem incredible that with knowledge of conditions as to the area that was put out of wheat raising and the increased areas that were put into wheat on the North American continent and in other parts of the world as well, when those countries went back to producing wheat to expect that we could sell them the wheat that we had been selling them while they were devastated.

In China the conditions of government are such that whether it is the government of Nanking or some other government that you are going to deal with you do not know what the conditions will be. Private purchasers have acquired wheat from Canada but the only offer which China made to this country in consequence of negotiations and inquiries and investigations was an offer to buy wheat at a price that we would not accept if we had the wheat to sell and at a price that we would not ask those who owned it to accept, and in addition they contemplated payment over a long term of years, necessitating that the dominion government finance the transaction in the meantime to provide the purchase price to those who sold. I am not unmindful that when the hon. gentleman first discussed a wheat conference at Regina he said, and the first literature that was prepared indicated, that all Canada had now to do was to produce, produce, produce, and many accepted his statement-

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
LIB

William Richard Motherwell

Liberal

Mr. MOTHERWELL:

When did I make that statement?

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

When the hon. gentleman first started the discussion with respect to the world grain conference at Regina, and the first literature was withdrawn for that very reason, because there was such a lack of understanding and appreciation of the fact that the countries that had been devastated were now coming back into the production of grain. That was a very reasonable mistake to make, I suppose, but it was made. So far as we are concerned we have endeavoured by every means within our power to bring home to the Canadian people the fact that in the countries in which formerly they sold their product they can no longer sell it for the simple and obvious reason that those countries all over Europe-down the Danubian basin, in Hungary, France and elsewhere, and in the Czechoslovakian countries, in all that territory where grain was produced in such abundance before the war, and which with the war was devastated- once more began to produce: the hardy peasants, finding how few of them relatively were left, as compared with their numbers before the war, prepared the soil for wheat, with renewed energy, and reaped an abundant harvest by their labour. That has deprived us of our market, although in the meantime we increased our production by adding ten million and more acres to the area under wheat cultivation. And now, confronted with that situation, all that has been said is this: "You have no warrant to continue on such a large scale; you have no warrant to increase production"; and when the hon. gentleman referred to the Bible as an authority, I wondered whether he had read the Pentateuch. Does he realize that under the Jewish dispensation one of the first things taught was the necessity for lands to lie fallow? The husbandman was to leave his lands fallow for a time in order that there might be increased and improved production; and if you read the directions given in this regard- and no one knows this as well as the hon. member for Winnipeg North Centre (Mr. Woodsworth) does, who is a greater authority in this field than I am-you will find that ir

4598 COMMONS

Supply-International Wheat Agreement

those days there was a clear appreciation and understanding of the fact that they did not produce more than they needed.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
LAB

James Shaver Woodsworth

Labour

Mr. WOODSWORTH:

There was also a

jubilee in those days when all debtors were allowed to go free.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

Yes, and if the hon.

gentleman lives for a hundred years he will have one too-we shall all have a jubilee together. I can only assure the hon. gentleman that the arrangement that was . made had met with great difficulty. The importing countries had urged upon the Argentine the necessity of doing nothing that would impair the value of the international arrangement, in the making of which so many countries had participated; and in view of the fact that the United States had the poorest crop it has had since, I believe, 1847-1 speak subject to correction on that point-and with the stricken areas in some parts of Europe, and the low crop in western Canada, particularly Saskatchewan and some parts of Alberta, and the relatively small crop which Manitoba produced compared with the large total crop produced in western Canada, the situation is such that there is rapidly coming an equilibrium between production and demand, and until that time does come it is perfectly obvious that a difficult situation will exist. Whether it is brought about by man's action, vision, prescience and foresight, or by natural conditions or the devastations of grasshoppers, it follows that as the demand is fairly constant and can only increase where there is a diminution of supply in what were formerly importing countries, this country and others similarly situated will be able to meet that situation and that the husbandman, when there is equilibrium between supply and demand, will receive a reasonable return for the labour of his hands. But there is no sale of wheat in China at a price that would not involve the Canadian producer in a loss of from ten to twenty cents a bushel. That is the position.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
LIB

William Richard Motherwell

Liberal

Mr. MOTHERWELL:

As far as I can understand the Prime Minister, he overlooked telling us why he did not ask the house to concur in this wonderful agreement. If we had concurred, other countries could not complain that we had not done this or the other.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Pierre Édouard Blondin (Speaker of the Senate)

Conservative (1867-1942)

Mr. SPEAKER:

The hon. gentleman has exhausted his right to speak.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
LIB

Charles A. Stewart

Liberal

Hon. CHARLES STEWART (West Edmonton) :

I did not intend to say anything about this matter until the Prime Minister rose to address the house. Apparently all our troubles

arise from the fact that Europe is now in production to a larger extent than before, or at least since the days of the great war. The amazing thing to me is that climatic conditions have played an important part in reduction in Canada and helped the situation tremendously. I wonder what would have happened to the Canadian farmer if we had produced at the same rate as we did in 1926, 1927 and 1928. Yet the right hon. gentleman seems to forget that the one country upon whom we could depend, or rather group of countries, Great Britain and the empire, for the absorption of our surplus wheat production, we have taken action against by way of tariffs, imposed in 1930 and 1931. The result is that to-day, even with depleted production, we are piling up surpluses every year. In view of the tariff increases against imports of British goods into Canada, can anyone blame Mr. Elliot and his propaganda for independence of any of the empire countries?" Not a particle, when the empire countries treat Great Britain in the manner this government has done. While we have no claim on European countries, any trading we have done with them has been largely due to the fact that they required our product; and when owing to climatic conditions, the very best quality of wheat produced in Canada has been almost nil during the past three years, this government finds itself in the unhappy position of having piled up a larger surplus than any other wheat exporting country in the world. Yet hon. gentlemen opposite will tell us and the electorate that there was nothing they could do. The thing is perfectly absurd. There is a great deal that this government could have done and has refused to do, and I want to make this statement now in the House of Commons because I am going to make it on a great many platforms in Canada; and I am serving notice on the government that it will be made in no uncertain terms. So far as the farmers of this country are concerned, apart from granting relief, which I admit the government has done in a generous way, my hon. friends have done nothing, which they can name, that has been of the slightest assistance in selling the export products of Canada.

Mr. THOMAS F. DONNELLY (Willow Bunch): Three things are disturbing the farmers of western Canada: first, our climatic conditions; secondly, a market for our products; and thirdly, debt adjustment. We believe that this government has done much to injure the market for our products. The one thing we have to sell chiefly in the markets of the world is our wheat. When the Liberal

Supply-International Wheat Agreement

government came in in 1921 we were shipping between 200 and 300 million bushels, and in 1929 we were shipping 407 million bushels. Since that time the market for our wheat has gradually dwindled until this year, with a quota of 200 million bushels, we shall not be able to fill our quota. Year by year the market for our wheat has grown smaller and smaller, and the explanation is to be found in the trade policies of this government. Not long ago there was a conference at Rome attended by all the exporting countries and by practically all the importing countries, and one importing country which in the past has used a great deal of Canadian wheat gave us the answer then. France said: "We are willing to take off the restrictions we have imposed on Canadian wheat; we would like to take the duty off your wheat and are willing to buy it from you, but what will you buy from us in exchange for it"? Did we see a delegation set out from Canada to France to try to make arrangements to buy some of their products in order that they might buy our wheat? We did not; not a thing was done. The result is that the other day France doubled her duty on our wheat. When this government came into power her duty was eighty-five cents a bushel. It was increased to SI.44 and the other day it went up to $2.88 a bushel, making it absolutely impossible to sell any of our wheat in that country.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

We could not sell at $1.44

either.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

We may not have been able but the price was high in France and it kept it up.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

She was exporting.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

But she allowed the exchange.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

And the duty has nothing to do with it.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

The duty has something to do with it. Just the other day, during the time of the elections, a Japanese agent was at Regina. What did he say? He said: "We have been buying 24,000,000 bushels annually from Canada and now we are buying 4,000,000 bushels. Why? Because Canada is not buying goods from us and we are buying from those countries that are buying from us. We are buying from Australia."

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Ambrose Upton Gledstanes Bury

Conservative (1867-1942)

Mr. BURY:

Are they buying wheat from countries that are buying from them?

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

Yes. Why is Argentina able to fill her quota? Why are we not able

to fill ours when we have a carry-over of about 200,000,000 bushels? Why is Argentina selling more wheat in England than we are and able to fill her quota? It is because we are not buying from England and Argentina is. Why does Switzerland that used to buy from us 10,000,000 bushels of wheat buy now only 3,500,000 bushels? Let my hon. friend read the Commercial Intelligence Journal. What does Switzerland say? She says: "We have to cut off our imports from countries with which we have an unfavourable trade balance and to buy from countries that buy from us." The result is that Canada has a market there 6.500,000 bushels less than she used to have. That is the whole story. We are not buying in the outside world from those that buy wheat and the result is that they buy from other countries that buy from them. Unless there is some change in this policy with which this government is imbued, our market for wheat will continue to fall off from, year to year as it has been doing since this government came into power. The whole story is told, as the hon. member for East Edmonton said, in our high tariffs.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Ambrose Upton Gledstanes Bury

Conservative (1867-1942)

Mr. BURY:

May I correct the hon.

member? The hon. member for East Edmon-tion never said anything of the kind and hopes he will keep his brain sufficiently clear never to say that.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

I meant the hon. member for West Edmonton (Mr. Stewart).

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

Charles Hazlitt Cahan (Secretary of State of Canada)

Conservative (1867-1942)

Hon. C. H. CAHAN (Secretary of State):

The hon. gentleman (Mr. Donnelly) has referred to France. I sat down on one occasion with twelve or fifteen gentlemen representing four or five departments of the government of France, to negotiate a treaty with that country. When it came to the discussion of wheat I was pressing for the admission on favourable terms of Canadian wheat into the French market and I was very insistent. One gentleman, I think it was the representative of the Department of Agriculture asked: "Mr. Cahan, do you know anything of French history?" I said that I knew something of French history as a schoolboy and as a student at college, and I knew something of her later history. "Well," he said, "if you have studied French history you will know that for four and a half centuries no man in France has reached the age of sixty years and certainly not sixty-five years who has not seen this country overrun with foreign troops." He said: "We no longer are able to maintain a fleet that will safeguard the carrying of wheat to France from Argentina, Australia and Canada in case of war. We have learned

4600 v, COMMONS

Supply-International Wheat Agreement

by experience, and the policy of the French government and of all governments in France will be to produce sufficient wheat in France to maintain its population in case another crisis should arise in Europe." He said: "It is useless to present to us any arguments to the contrary." Then as I proceeded to urge that the use of strong or hard wheat was necessary in that country for mixing purposes, one of his assistants said: "But we are producing all the hard wheat that is necessary for French consumption." I asked: "Where?" He said, "For some years we have been importing from Saskatchewan hard wheat, sowing it in our North African provinces and producing there as good quality of hard wheat as you produce in Saskatchewan." He said: "We had available last year of hard wheat from the North African colonies 25,000,000 bushels for sale in France, and we must give prior advantage in our market to our Algerian colonies." One gentleman sitting beside him, a more elderly man-I remember his name but I shall not repeat it-said: "Perhaps you are misleading Mr. Cahan in this discussion, because although we imported hard wheat from Saskatchewan and sowed it, in the first year we produced equally good wheat as that of Saskatchewan, and from the seed of that crop there was equally good wheat the following year, yet in the third or fourth years the wheat tends to deteriorate and become soft, and we may have to import hard wheat from your country for our sowing every third or fourth year. But outside that you cannot hope for any large market for your wheat in France." Then, turning to the statistics, he showed me that for the previous year they had produced in France alone outside its colonies within sixty million bushels of the total product of Canada from sea to sea, and that for that year, according to the returns which were in then, they were producing more wheat in France alone than we had produced in the whole of Canada in the previous year. Under those circumstances it does not become a question of tariffs; it becomes, on the part of France, a grave question of national policy, based upon a clear determination on the part of successive governments and of all parties in France to raise in that country, at no matter what cost, sufficient wheat to feed their own people.

In Switzerland much the same situation exists. The Swiss regulations against the importing of foreign wheat have absolutely nothing to do with the tariff in Canada on Swiss products, but are due to the demand of the Swiss agriculturists that they shall be so protected and bonused as to enable them to supply from their own cultivated lands the

[Mr. Donnelly.j

entire quantity of wheat required in Switzerland. That is with them also a matter of national policy.

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink
CON

James J. Donnelly

Conservative (1867-1942)

Mr. DONNELLY:

Will the hon. member say whether this report of the Commercial Intelligence Journal regarding Switzerland is wrong?

Topic:   INTERNATIONAL WHEAT AGREEMENT-STATEMENT OF MR. MOTHERWELL
Permalink

July 3, 1934