February 21, 1939

CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

That is all they will be.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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?

Some hon. MEMBERS:

Hear, hear.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

I am glad to hear

that applause, because *what I have said is the absolute fact. Canada and the United States are natural rivals. That is particularly true with respect to agricultural products. The United States is a great agricultural country, and she has a surplus of and is exporting everything that we are producing. Since the great war, economic nationalism had largely closed the European markets to foreign exporters, and the British market was the only stable market left in the world.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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LIB

William Daum Euler (Minister of Trade and Commerce)

Liberal

Mr. EULER:

It is still free.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

Since 1932 the United

States has looked with a great deal of envy on the preference which her competitor had in the British market. She set herself resolutely to destroy those agreements. I say that no country can prosper or give to its people permanent employment if she permits the importation of goods which she has the capacity to produce. When we send our money out of the country we never see it again. When we spend our money at home we are giving employment to our people, and we are building up markets for both industry and agriculture.

Everything which is required to satisfy the needs of humanity can be and is being produced within the confines of the far-flung British empire. Joseph Chamberlain was the first man to be seized of this great idea, and he was the first British statesman who advocated empire preferences. It is true that he went down to defeat advocating them; but his son, the present Prime Minister of Great Britain, had the honohir of signing at Ottawa in 1932 agreements containing the very provisions for which his father had met

defeat. Those provisions kept this country solvent and saved our farmers from bankruptcy. Those of us who were in the house at that time well remember how the present Prime Minister (Mr. Mackenzie King), then leader of the opposition, opposed these treaties, how he kept us here week after week, denouncing them, and stating that when he caine into office he would repeal them, and how he gathered into line his followers and had them vote against the treaties to a man; not quite to a man; there was one hon. member who voted with us at that time, and he will go down in history as the only Liberal in the house who had sound judgment. Yet, with all the opposition they have received, these treaties have kept this country from bankruptcy since 1932.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Hugh Alexander Stewart

Conservative (1867-1942)

Mr. STEWART:

And hon. gentlemen opposite renewed the agreements.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE (Quebec East):

They

improved the agreements.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

The treaties with the

United States have always been precarious affairs. Their tariffs have moved back and forth like a weaver's shuttle, and have no stability; and I am afraid we are getting into the same rut in Canada. Industry in Canada to-day is being paralyzed by constant monkeying with our tariffs. When one government gets in, down they go; when another gets in; up they go. There is no stability. Tariffs should be taken altogether out of politics. What are tariffs? Tariffs are instruments in the hands of governments whereby they can deal on equality with other countries in which climatic conditions, scales of wages and living conditions are so different that adjustment is necessary. That adjustment should have some permanence; otherwise men will refuse to put money into industry. They will not put money into industry until they have some reasonable assurance of stability.

The hon. member for Huron North (Mr. Deachman), speaking on the address, said he regretted that Canada had rejected the reciprocity treaty of 1911. That treaty contained a clause whereby it could not be terminated without mutual consent, and that gave a foreign country for the first time a say in the domestic affairs of Canada. The late Champ Clark, speaking in the House of Representatives of the United States, gave utterance to the naked truth, when he said that if that treaty passed, as he expected it would, Canada would become an adjunct to the United States. The people of Canada can always look back with pride and pleasure upon having defeated that agreement.

ligg COMMONS

Canada-United, Stales Trade Agreement

But what happened two -years afterwards, in 1913? There was a change of government in the United States. Woodrow Wilson placed agricultural products on the free list, and we had n very much better bargain in 1913 with the United States than was contained in the reciprocity agreement. From 1913 to 1921 agricultural products went free into the United States, but from 1921 to 1930 we lost our markets there while a Liberal government sat on the treasury benches in Canada. It was in that period that the Fordney-McCumber and Hawley-Smoot tariffs and all the other regulations were passed that shut us out of that market. What did the government of that day do? They sat idly on the treasury benches, just as they are sitting to-day, doing nothing, and their only policy was, "We must not provoke that great nation to the south of us." They saw our markets receding; they saw the European market closed, the United States market closed, and yet they sat idly by and allowed the Canadian market to become the dumping ground for the surplus products of every other nation in the world.

Prior to the war Italy, Germany and France bought millions of bushels of Canadian wheat; but the war brought home to them the lesson that they were dependent upon a foreign country for their bread and they were determined not to be caught in that condition again. Therefore they placed on foreign wheat a duty greater than the world price of wheat, until to-day they have become self-sustaining. At any rate, they are no longer a factor in the market in the purchasing of wheat. So in 1930, when the Conservative party came into office, they found the European markets closed and the United States market closed; the only market left was the British market; and they met competition there, on even terms, from their greatest competitor, the United States, a country whose crops were ripe and whose produce was ready for the market from a month to six weeks before our's was.

In the securing of the agreement's of 1932 giving us a preference in the British market there was brought about one of the greatest accomplishments in Canadian history. It must always be borne in mind that the United States is our greatest competitor. The United States has a surplus of the same articles that we export and that we are trying to sell to that country, while on the other hand Great Britain must annually buy hundreds of millions worth of foodstuffs which cannot be produced on that small island. That is where our market lies. Another fact to be borne in mind is that the British market is not a dumping ground where the surplus products

of the entire world can be disposed of. Britain has her limitations in purchasing, and every bushel of wheat that the United States sells to Great Britain is just a bushel less that Canada will be able to sell there.

Before this treaty was consummated, the leaders of industry, boards of trade, and leaders in agriculture were consulted in Great Britain and the United States. Delegates from Great Britain and the United States went to that conference, fortified by the advice and the wishes of industry, agriculture and labour in their respective countries. What about Canada? Who was consulted here? These men went to Washington to bargain with men who had agreed upon what they were going to do. Our men had asked advice of no one in Canada, and it was natural that when they came up against the shrewd bargaining power of those two great countries they had it put over them.

The Prime Minister's statement that this treaty will create closer relations with the United States and Great Britain has to my mind no foundation in fact. It is many years since there was even a ripple among these three great democracies-Great Britain, Canada and the United States-and I ask the house, since when has it become incumbent upon a country that has made a trade treaty with another country to fight for that country? We have trade treaties with Germany, Italy and Japan. Did we send our soldiers to fight for Japan in her war? No; the very idea would be repugnant to us. Yet we have trade treaties with those countries.

It is also stated by several prominent British statesmen that the imperial government would never ask Canada or any part of the empire to modify any part of those agreements. That is not the way in which Great Britain does business. When she makes a treaty she stands by it, and it is perfectly obvious that the pressure to have those treaties modified came from our great competitor, the United States.

To my mind the treaty before us is the beginning of the end of our imperial preferences. The United States will never rest content until they have completely wiped them out. The British market to-day is the only stable market there is left in the world, the only market which we should make major attempts to develop. The brevity of this treaty condemns it, in our opinion. Channels of trade cannot be altered every few years without tremendous loss to the exporters.

The other day I read a report from Washington dated November 18, 1938, stating that prior to these preferences going into

Supply-Public Works

effect in 1930 they had sold large quantities of wheat to the United Kingdom; that their trade had gone down materially, but that they expected to regain it on getting free entry. They gave these figures: In 1930 the United States sold to Great Britain 39,267,000 bushels of wheat. In 1933, one year after these preferences went into effect, this dropped to 9,000 bushels. In 1930 Canada sold to the United Kingdom 97,234.000 bushels, and in 1933 that increased to 140,459,000 bushels. In other words, prior to these treaties being signed and the preference of six cents a bushel being given to Canada, the United States were supplying 20 per cent of the requirements of the British market in wheat, and after they went into effect, this fell to [DOT]05 per cent; while in 1930 Canada was supplying 40 per cent, and after the preference this rose to 67 per cent. In the face of those figures we have this remarkable statement from two of the ministers. The Minister of Trade and Commerce said the other day that this 6 per cent preference was of doubtful value, and this afternoon the Minister of National Revenue (Mr. Usley) said that it was a minor factor.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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LIB

James Lorimer Ilsley (Minister of National Revenue)

Liberal

Mr. ILSLEY:

A minor factor in creating port business.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

All I have to say is that there is none so blind as those who will not see.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

William Earl Rowe

Conservative (1867-1942)

Mr. ROWE (Dufferin-Simcoe):

The same effect on apples.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

Every trade treaty this government has made with the United States has been detrimental to the interests of Canada. In 1935, with all due respect to the figures given by the hon. member for Huron North, we had a favourable trade balance with the United States amounting to $57,688,000, but in 1938 we had an unfavourable trade balance of $67,981,518. That is, in three years after this treaty was signed, our trade with the United States fell off to the extent of $125,669,518, and in the same years our trade with Great Britain had risen from $191,000,000 to $225,000,000.

Another alarming feature about this agreement is that it permits some thirty-odd nations to get the same concessions in the Canadian market that the United States have been given. I want also to register my protest against treaties of such great importance being made effective without the sanction of parliament. The Prime Minister said the other day that they had authority to put this agreement into operation without presenting it to parliament. In 1932 Mr. Bennette called a special session of parliament, presented his agreements

and had them ratified by parliament before they were made operative. The agreements which were made in 1935 were put into effect on January 1, 1936, and parliament was called together a month later. The agreement of 1938 was put into operation on January 1, 1939, and parliament was called twelve days later. We are now discussing an agreement which is already law, and no hon. member had any say whatever in its provisions. The members of this house who are elected and sent here to look after the business of the country have been ignored. In such an important matter as this, even though the government may argue that they had the legal right to do it, there are things which are not expedient and should not be done.

After examining this treaty carefully I have arrived at the conclusion that Canada has been made a catspaw to pull American chestnuts out of the fire. In conclusion, because I made an agreement that I would allow the government ten minutes to-night, and I am going to do it-

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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?

An hon. MEMBER:

Too much.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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CON

Thomas Alfred Thompson

Conservative (1867-1942)

Mr. THOMPSON:

No, I said it, and at ten minutes to eleven I stop. But I say that the future welfare of Canada and the happiness and prosperity of her people depend upon closer union with the British empire, and the further development of inter-empire trade. Both of these this treaty tends to destroy.

On motion of Mr. MacLean (Prince) the debate was adjourned.

The house in committee of supply, Mr. Sanderson in the chair.

Topic:   TRADE AGREEMENTS
Subtopic:   CANADA-UNITED STATES CONTINUATION OF DEBATE ON MOTION FOR APPROVAL SUBJECT TO REQUIRED LEGISLATION
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DEPARTMENT OP PUBLIC WORKS


292. Departmental administration, $190,540.


LIB

Pierre-Joseph-Arthur Cardin (Minister of Public Works)

Liberal

Hon. P. J. A. CARDIN (Minister of Public Works):

This amount covers salaries and travelling expenses, stationery, et cetera, of the members of what is called the administrative section of the Department of Public Works at Ottawa. It covers the office of the minister, the offices of the deputy minister, the assistant deputy minister, the secretaiy and the purchasing agent of the department. There is a little decrease of $130; that is the result of readjustment of positions in the department.

Topic:   DEPARTMENT OP PUBLIC WORKS
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Item agreed to. Chief architect's branch- 293. Branch administration, $226,280. This is the administration of the branch of the chief architect's office at Ottawa. There Supply-Public Works



is an increase, also on account of changes in positions in the service and statutory increases.


CON

Hugh Alexander Stewart

Conservative (1867-1942)

Mr. STEWART:

What attracts the attention at once in reading this item is the substantial increase from $5,000 to $11,560 in temporary assistance. When one looks over the skeleton of these estimates, what impresses one is the almost complete absence of anything in the nature of a program for the construction of public works. The amounts are strikingly small. I think the total of these estimates is $11,000,000, the greater part of which is made up of salaries, administration and all that sort of thing. I can come to no other conclusion than that the minister and the government have in mind bringing in as supplementary estimates a very heavy program of public works. If such is not the case, why should we find in different items increases such as I have mentioned, providing for temporary assistance that cannot possibly be required for the execution of any program embodied in the main estimates? Possibly between now and the next time these estimates are up, the minister may be able to consider this matter and be in a position to make a statement to the committee. I am sure, if this is the main body of the public works program for this year, the minister must be ashamed of it. It is so trifling that it is perfectly clear that it is not the real program of the government at all. It is just a sort of smoke-screen that is put up, and there must be something else behind all these details of administration and so on, which compose the skimpiest, smallest program in the history of the department.

I should like to ask the minister when he hopes to be able to take the committee into his confidence and tell us when those supplementary estimates will be brought down. As the minister knows, it is desirable that the public works department should get its program under way as early in the season as possible. That is one reason why the estimates of this department are usually taken up early in the session, and when they are passed and approved the departmental officials prepare their program and get to work as early in the season as possible. It is difficult to get started as soon as they would like, but unless the supplementary estimates are brought down and passed by this house within a comparatively short time it will be late in the season before it will be possible to undertake this work.

Would the minister be good enough to give us some information as to why these estimates are so emaciated, so abbreviated, so very small as to hardly justify him in opening his

department at all at this stage? Apparently he is only asking for a great deal of money for salaries, because he has no program of works in these estimates. That is the very opposite to the usual procedure. The main estimates are supposed to contain the main features of the program of the government, while the supplementaries really cover things that have developed after the preparation of the main estimates. In this case the order is reversed. The main estimates which are here ought to be the supplementary estimates, and apparently the real main estimates are to be brought down some time later, possibly quite late in the session.

I should like the minister to take the committee into his confidence and let us have a statement in regard to the exceptional, extraordinary situation which is disclosed in these estimates.

Topic:   DEPARTMENT OP PUBLIC WORKS
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February 21, 1939