July 3, 1944

LIB

Thomas Reid

Liberal

Mr. REID:

We will give you our copy. Here is the proof .

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Subtopic:   THE BUDGET
Sub-subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

The second matter I wanted to comment on was the statement made in this house by the Minister of Munitions and Supply (Mr. Howe) on June 19, 1944, to be found on page 3926 of Hansard. I am sorry the hon. member for York-Sunbury (Mr. Hanson) is not in the chamber, because a few days ago he was anxious to hear this. The statement made by the Minister of Munitions and Supply was in answer to a question put by myself as to why some coal

The Budget-Mr. Gillis

mining collieries in Nova Scotia were not working on Saturdays. My question was prompted by a resolution which I had received from some of the mine workers' unions.

At that time the Minister of Munitions and Supply-I am not blaming him for this, because I believe he is anxious to find a solution to the problem-read into the record a statement which he had received from the fuel production board. That statement pointed out that production in the coal mines of Nova Scotia was down to an alarming extent and that absenteeism had increased beyond what could be considered as at all sensible. In effect the minister led the house and the country to believe that the deplorable state of affairs outlined by him was due to one cause only-absenteeism. He led us to believe that the miners of Nova Scotia were not working and that as a result production was down. That is the way I would have takeu that statement had I not been in the house and known the circumstances. As I say, I am not blaming the minister for making the statement, but I do want to place the other side of the story on the record.

I want to make it very clear that I am not condoning absenteeism in any way, shape or form. To the extent that absenteeism may militate against production in the collieries, I say it should be removed. It is the prerogative of those charged with the getting of production, the emergency fuel board, the operating companies and the miners' unions, to see to it that that particular cause is removed. But it is not responsible for the drop in the production figures as the minister was led to believe and as this house was led to believe from his statement.

I want to jog the memory of the house on one point. In the 1943 session the Prime Minister declared that an emergency existed in this country in connection with fuel. Upon that declaration being made, the government appointed an emergency production board, which was given sufficient authority and administrative latitude to see that the production in the mines of Canada was brought up to the point where it would assist our war effort and guarantee domestic fuel supplies. Rather than an indictment against the mine workers of Nova Scotia as one listening, to it might be led to believe the statement put on the record by the Minister of Munitions and Supply stands as an indictment against the emergency fuel production board. The board had supreme authority, and I know that the Minister of Finance, through his department and other agencies of the government, has made available to the board the necessary financing and everything it needed

100-279i

to see that production was increased. Why was production not increased? What happened that it was not increased? I say that the statement put on the record by the Minister of Munitions and Supply stands as an indictment against the efficiency of the fuel production machinery set up by the government. There is no other way you can look at it. If I am given a job and the necessary machinery to do it, and the necessary finance, and I do not get that job done, the responsibility is mine.

I wish the Minister of Munitions and Supply were here, because I am going to endeavour to show him, as I did on a previous occasion in this house, exactly why you are not getting coal production in the mines of Nova Scotia. We did that when the board was set up from our places in the house, and if the machinery 'which was recommended by myself and by the mine workers had been set up, the situation would not be what it is to-day I am certain of that.

Was this present production situation not anticipated? Did it drop out of a blue sky? I do not think so. The premier of Novai Scotia appeared before the reconstruction committee on December 2, 1943. He commented on the production situation and fully anticipated the very situation we have now. He elaborated on the number of tons that had been produced last year and forecast for the following year a shortage of approximately

1,200,000 tons. Why? Because he knew the situation. He was at least realistic about it. Anyone who wants verification of this statement will find it in the minutes of proceedings of the reconstruction committee volume No. 35. There you will find Premier MacMillan's statement that he anticipated the production situation we have now. The only people who did not see the picture as it really was were the heads of the fuel production board. Who were they? First you took in Mr. Henry Borden. My friends to my right have himi now as organizer, and I hope he does as good a job there as he did on the fuel production board. He was the head of Barclays bank. Do you expect to get fuel production by bringing from Toronto to Ottawa a banker and giving him authority to organize your coal mines of Canada? I talked for an hour with him when he first came here; I was toldt by the Minister of Munitions and Supply to>

go and see him. He is a nice fellow, but he had not the slightest idea of the job he had to-do-not the slightest. Right along, instead of picking men who knew production in the collieries to assist these boards and organize the machinery at the point of production where you would have had a solution to the problem,.

The Budget-Mr. Gillis

you fastened on men from the top down who were interested in maintaining private enterprise and their control on the economy of this country, and not interested in getting coal production by organizing the people who were producing the coal, because that might mean losing a little bit of their authority. That is the reason you did not get production, and there is an indictment against your fuel production board that will stand for all time, the indictment that was read into the records of this house by the Minister of Munitions and Supply.

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LIB

Humphrey Mitchell (Minister of Labour)

Liberal

Mr. MITCHELL:

I think my hon. friend will admit that steps were taken to organize war production committees to increase the production of coal. That was done by the Department of Labour and by the Department of Munitions and Supply.

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CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

Yes, but they were not organized.

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LIB

Humphrey Mitchell (Minister of Labour)

Liberal

Mr. MITCHELL:

They are organized.

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CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

Your production committees as you visualize them in that industry will not get production, because in the mining industry of Nova Scotia you have a one .hundred per cent organization of the workers, and you have a mine committee that functions six days a week, acting as a liaison between the manager of the colliery and the local union. That committee has certain * definite functions to perform within the limits of the contract signed by the company. The solution is not there.

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LIB

Humphrey Mitchell (Minister of Labour)

Liberal

Mr. MITCHELL:

If that is not the solution, perhaps my hon. friend will tell me what his solution is. We tried sincerely to increase production. We set up a special board on which organized labour and the employers were represented here in the city of Ottawa, and we have also two field men in Nova Scotia with the end in view of setting up production committees. My information is that an understanding has been arrived at between the management and the mine workers' union of America.

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CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

by being about three cents better off than they were prior to getting the increase. That kind of thing does not make for harmony, nor does it get you production.

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LIB

Gerald Grattan McGeer

Liberal

Mr. McGEER:

Why were they only three cents a day better off?

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CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

For the simple reason that

the company went about chiselling on other rates, to such an extent that the men wound up by being about three cents a day better off than they were before the dollar a day was granted to them.

Here is a letter from Douglas McDonald, who is a member of the legislative assembly and also a board man of the United Mine Workers of America in the New Waterford district. He writes this letter of his own volition; I did not ask him for it. He says:

This morning, June 20, thirteen loaders from .17 West Wall No. 12 colliery were forced to .come home after going down to place, the face 'was left unprotected,. no hardwood blocks or .props for men to put up, and piles of hardwood *and thousands of props on surface. Here is a loss of approximately 220 tons of coal. . . .

He goes on to tell me the story. It confirms what I pointed out a moment ago. With your other machinery functioning, with contacts through the medium of your mine committees and your production committees which could be utilized later, conditions of that kind would be reported direct, the machinery would function properly on the job, and these conditions would not exist.

In connection with working on Saturdays-

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LIB

Thomas Vien (Speaker of the Senate)

Liberal

Mr. SPEAKER:

The hon. gentleman's time has expired.

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CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

I shall be through in a minute. There is something more in that story than the Minister of Munitions and Supply would indicate. I have here an editorial appearing in the Glace Bay Gazette of June 29 in which I observe that action is going to be taken by the miners' union against selective service for not enforcing the regulations with respect to the men being kept on the job. According to this, men are reporting for work on Friday nights and reporting on Saturdays, and they are being sent home from the colliery, which [DOT]constitutes a violation of a certain section of national selective service regulations. I know that these men are not quarreling with the officials and the people down there, trying to get the mines working on Friday nights and on Saturdays because they want to create an [DOT]impression somewhere. They are not.

If I may take a minute before I close, I would like to point out that one factor that is feeing classified as absenteeism, and incorrectly

Mr. Gillis.)

so, is that hundreds of the younger miners who produced coal in 1939 to the extent indicated in the minister's report, working a fairly decent man-day, through which production was built up, are to-day in the services in France and Italy. We have now in the mines in Nova Scotia, and I presume the same is true of the west, older miners whose backs have been broken, so to speak, loading coal and working five or six days a week, and who are not able to maintain the production which the younger men could maintain up to 1939. They were working only two and three days a week; every pound of coal that could be produced was produced within two or three days, so that the figures given by the minister in that connection are not correct.

I merely wanted to emphasize the two points I did, without going into the budget specifically, because I thought it was necessary that the record should be clarified in these two particulars.

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LIB

Walter Adam Tucker

Liberal

Mr. W. A. TUCKER (Rosthern):

Our country is almost at the end of the fifth year of its participation in the greatest war in human history. Amendments to the budget emphasize the various alleged sacrifices at home, but I suggest that the real sacrifice at this time in this war is that of the young lives that are being cut off, or the sacrifice made by young men who are being seriously injured on the veiy threshold of their lives. If we are to bring to fruition the better things for humanity made possible by the untold sacrifices that are being made, we of the united nations should continually remind ourselves that we failed our young soldiers, sailors and airmen, to a great extent following the last war. We had high hopes at that time and talked very much as we do to-day; we said that it was a war to end all war and that we were going to build a world fit for heroes to live in. Our failure to live up to the high hopes then held out-and that failure cannot be denied, for another world war has occurred within twenty-five years of the close of the last one, and we have had widespread unemployment, such as prevailed particularly in the thirties throughout the world-should indicate to us that it is not enough to have good intentions. We must have very well thought out plans in order to avoid the same results following this war.

Obviously Canada cannot within and by herself totally take care of the problems which face us, because no self-contained reorganization of our internal set-up can entirely prevent a similar failure again. We must this time avoid past mistakes and resolve to do our part both within the country and externally to see that these mistakes are not repeated

The Budget-Mr. Tucker

after this war. This will entail our taking full part in the world organization to guarantee peace. Personally I cannot think of anyone who is more likely to see that Canada does everything that is possible to promote this end than the present Prime Minister (Mr. Mackenzie King). In my judgment it would be a tragedy if anything happened to prevent him from representing Canada at the peace conference. Any hope of a lasting peace must be based on our doing all we can to see that a just peace is established, so that we shall have a peace that will not break down in spite of our efforts to preserve it. The present Prime Minister's long experience of world affairs, as a negotiator and conciliator, should make his contribution a most important and perhaps vital factor in a successful peace conference. In this connection I submit that we must not only restore the brave peoples of France, Poland, Norway, China, Czechoslovakia, and other overrun countries, to full freedom and liberty; we must support other peoples in their aspirations toward freedom, liberty and self-government.

In this respect there is one people in particular in whose welfare Canada should take a special interest. They are people who have made in the past and are making now a substantial contribution to the building of Canada, and in this war they have taken a most worthy part in our war effort, having enlisted in our armed forces, and in^ every other way having done their full share in supporting the war effort. Their splendid efforts have been the cause of admiration and pride on the part of all Canadians. I refer to the Ukrainian people. I hope that the day is not long distant when the Ukraine will be a unified, free and self-governing nation. When that day arrives, the Ukrainian nation will be one of the great powers of the world. It will consist of forty-million people inhabiting one of the richest parts of the earth's surface. The Ukrainian people in Europe, by their courageous defence of their homes, by their enormous sacrifices in this war, have surely earned the right, if any people have, to their full measure of freedom and self-government, and I hope they will have it immediately following this war. I urge this government to give this matter their special attention so that when the peace conference comes it can give these aspirations of the Ukrainian people its full support.

I cannot let this occasion pass without again paying my humble tribute to the way in which those of all racial origins in Canada have united in the common service of the country. I feel that they have all done and are doing their part now, and after the war

people of all racial origins in this dominion will be able to look back on this era of great accomplishments with pride in the achievement of the various sons of Canada, regardless of their origin.

Turning now to the domestic arena, in which we must not again fail to guarantee a minimum standard of well-being to our people, young and old, I welcome the various steps already taken and to be taken by this government to bring economic security to our people. I feel that a tremendously worth-while step was taken in this direction by the enactment of the Prairie Farm Assistance Act, which gives the farmer some measure of economic security when he loses his crop or there is a crop failure. I believe this measure will have to be extended in western Canada by a greater measure of individual crop insurance. As it stands, however, it has been a most worthwhile contribution to economic security in western Canada.

I welcome the family allowances bill because it will ensure a certain income to all families in Canada with children under sixteen years of age, regardless of loss of position, regardless of loss of crops, regardless of the death or incapacity of the bread-winner. And since it is such a real humanitarian measure I personally find it hard to understand the opposition to it by some radical labour leaders.

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Sub-subtopic:   DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Thomas Vien (Speaker of the Senate)

Liberal

Mr. SPEAKER:

Order. I must call the hon. member's attention to the fact that the family allowances measure is now before the house in the form of a resolution. He will have an opportunity to discuss it when it again comes up. He must not discuss it now.

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LIB

Walter Adam Tucker

Liberal

Mr. TUCKER:

Mr. Speaker, I had in mind the fact that the money for that purpose was provided in the budget and that it would not be out of order to mention my support of the measure in the budget address.

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LIB

Thomas Vien (Speaker of the Senate)

Liberal

Mr. SPEAKER:

The hon. member will have an opportunity to discuss it when it comes before the house. On another occasion I had to call one or two hon. members to order on the same point.

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LIB

Walter Adam Tucker

Liberal

Mr. TUCKER:

The same objection may apply to what I intended to say in support of the health insurance scheme.

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LIB

Ian Alistair Mackenzie (Minister of Pensions and National Health)

Liberal

Mr. MACKENZIE (Vancouver Centre):

No; that is not before the house yet.

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LIB

Walter Adam Tucker

Liberal

Mr. TUCKER:

I would say that I welcome the measure to provide a real health insurance scheme for this country. I understand that all that is necessary to put it into operation as a workable and comprehensive scheme, perhaps as good as that of any country in the

The Budget-Mr. Tucker

world, is the full support of the provinces. 1 hope that it will receive that support and that we shall have in the near future a real measure of health insurance in Canada.

I also welcome the farm improvement loan scheme, because it is designed to improve the homes of our farming people. Since I have been in this house I have taken the attitude that our farming people are as much entitled to the amenities of life as people living in the cities, and if the provisions of this measure are brought into effect I think it will halt the tendency of people to move from the rural areas to the cities. I certainly welcome the bill by which the farmers may hope to improve their homes and equipment.

I commend the government most heartily for its provision that profits in agriculture may be charged back in regard to income tax against loss for one year or forward against loss for three years. It is well known that farming is a most uncertain industry, and while it was on a yearly basis, of course the profit of one year on which the taxes would be paid might be entirely wiped out by losses the next year or the following year. I am sure that that measure of relief to our farmers will be much appreciated throughout Canada.

As to the floor under farm prices, that again * is a recognition of something that has been perhaps overdue, but, at any rate, I welcome it. For many years it has been recognized that labour is entitled to minimum wages. At last it is recognized by our government which takes the attitude that farmers are entitled to minimum prices for their products, just as labour is entitled to fixed minimum wages, and for that reason I think the farming community of this country should welcome that measure being brought in at this session.

However, Mr. Speaker, underlying our ability tp finance and provided a high standard of living for our people in Canada without tremendous dislocation and interference with our individual freedom is the preservation of markets for the commodities which we produce in such enormously larger amounts than we can possibly consume in Canada. We know that in the decade before 1913, when we had a good market for our products, Canada enjoyed prosperity; likewise, we had real prosperity in the decade from 1919 to 1929, at which time there was also a real market for our exportable surpluses. During the period from 1930 to 1939 when world trade was dislocated by severe restrictions to trade by various nations we had a depression and suffering not only in Canada but throughout the whole world, and that includes Soviet Russia which was under a socialist government. Now the question is, has the world

learned its lesson in regard to the futility of each nation trying to live unto itself alone and build up a self-contained economy? I hope it has, but signs indicate that we should not take this for granted and should see to it that we in Canada maintain in office a government which does believe in promoting and improving world trade.

Canada is more dependent for prosperity upon retaining a market for her vast agricultural surpluses than perhaps any other country. I realize that to-day in theory we all believe in retaining world markets; theoretically we do. But world markets like everything else in this world can be obtained- only at a price, and I suggest that that price is our willingness to accept payment for our exports by imports. So far as we in Canada are concerned, except for the small part of our imports which come from countries which can grow produce that we on account of our climate cannot grow, the bulk of our imports consists of goods which we can produce in Canada albeit at higher cost and sometimes much higher cost. A protective tariff is designed to keep out goods which we cannot produce in this country as cheaply as we can import them. By so doing not only does it raise our cost of living and production but, what is even more disastrous, it destroys the means of other countries buying any of our exports. As I have stated, anyone who studies the effect of trade on Canada's economy must be struck by the fact that we in Canada depend perhaps more than any other country on export trade. Approximately one-third of our national income comes directly from the sale of our exports in foreign markets. A large part of the remainder of our economy in turn depends upon the purchasing power of the third within Canada which does depend directly upon foreign trade. Therefore the part of our economy which depends upon purchasing power based upon world trade is very large. One has only to think of the difficulties of our farmers from 1930 to 1939 owing to the curtailment of our export market to realize this point. Think of what would happen if by trying to establish a self-contained economy we lost our export market for wheat. Not only would about three-fifths of our western farmers have to turn to some other occupation, but the value of their lands, buildings and machinery would be practically wiped out, if only a fraction of the land now used was required to grow the wheat which could be used and exported.

In this connection I most earnestly commend the government for removing the customs tariff on farm machinery, including milking machines and cream separators, for removing the war exchange tax of ten per cent from these

The Budget-Mr. Tucker

articles and1 for removing the tax on component parts of the same articles imported in connection with their manufacture in Canada. One of the things that seems to be overlooked is that, as I understand the situation, these items will now enter Canada from any other country of the world duty free. I do not think the words of the leader of the Cooperative Commonwealth Federation (Mr. Coldwell) in this regard are warranted in referring to the total abolition of such imports as a " mincing step," as he did in this debate. He said that farm machinery is monopoly controlled! and that something should be done about this. If such a condition does exist, no more decisive blow could be struck at that monopoly than to make all such articles free of customs duties, no matter from where imported, as is now being done. The leader of the C.C.F. took this attitude himself in times past and his late leader took the same attitude. If machinery can be brought in free, not only from the United States but from any other country, no monopoly can long exist and control prices, under those conditions.

The leader of the C.C.F. also used the argument that when the tariff on farm machinery was reduced, prices to the farmers actually rose. He, and others who use this argument, know very well that this is a specious and incorrect argument against tariff reduction. The reason for the rise in prices of farm implements in past years, in spite of a lowering of tariffs on imports from the United States of America, has been that cost of production, including freight rates, raw materials and taxes, has risen both in the United States and Canada. Wages, too, have risen. A large proportion of the increase in prices of farm implements has actually been due to the rise in the cost of labour.

The average annual earnings of labour en gaged in the manufacturing industry has risen by 212 per cent between 1910 and 1942, and from 1935 to 1942 by 45 per cent. As I understand it, the C.C.F. holds out the hope to labour that this upward movement in wages will be encouraged, not discouraged; so that I do not think the argument about the rise in prices being due to tariffs should be put forward by that party.

This raises another point. If the C.C.F. gets into power, and the farm implement industry is socialized, wages raised and working hours reduced, and it is found that, for example, Russia, with longer hours and lower wages, can make farm machinery cheaper, what would my hon. friends of the C.C.F. do? I do not think they would raise the tariffs; it would not be necessary, because they would operate our trade under an export and import

board. Imports could come in only with the permission of the import board, which the C.C.F. promises to set up. All imports of farm machinery from any other country could be excluded.

The socialized farm implement industry could then pay as high wages as it wished, and be as inefficient as it probably would ultimately become, under bureaucratic management. It could provide work at good salaries for hundreds of inspectors and government officials, and no one would be worse off except the farmer, who would probably be paying twice as much for his machinery as would, for example, his competitor in the Argentine.

Would this not extend to every other necessity of the farmer which could be made in Canada? Farmers' costs would necessarily sky-rocket. Where would this put the farmer, when he was placed in competition with farmers in other countries? I know the C.C.F. have an answer. They would pay more to the farmer for his produce. Having severely curtailed imports, they, of course, would have curtailed exports because nations after this war will be able to pay for our exports only if we take their exports in payment.

The C.C.F. would be in the position of having to buy the farmers' products, the market for which they had largely destroyed. And they would have to buy at increased prices. What would they do with those products? Who would pay the increased costs? They could not let prices of farm products go up in Canada, for that would take away the benefit of increased wages to labour. Taxes would be the only answer. On whom would those taxes fall? Necessarily they would fall on the people who earn money and have property. Since all major industries, except farming, would be socialized, under their present programme, it looks as if that industry would come in for pretty heavy taxation in order to supply the income the government would need to enable it to pay the farmer for the produce which it would buy and not be able to use.

I have condemned high tariff policies of Canadian governments in the past. The policy of the C.C.F. in handling our trade by export and import boards, on which of necessity the majority of the members would be from the central part of Canada, would in my judgment be far more disastrous to the farmer than any conceivable policy of high tariffs ever tried by any government in the past.

I believe we are entering a phase in world affairs when we, of all countries, should not think of entering into a socialist experiment which inevitably would lead to our losing a

The Budget-Mr. Tucker

substantial part of our world markets, and our haying to try to establish a self-contained ' economy resulting in terrific convulsions in our national economic organization, with consequential terrible hardship on our people.

So far as I am concerned, therefore, in the best interests of the farmers of this country, and particularly the people of Saskatchewan,

I feel I should uphold the Liberal party, not because it has always done everything I should have liked to see it do, not because it has always moved as fast as I should have liked to see it move in the past-

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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. KNOWLES:

Mr. Speaker, I rise to a point of order, and call your attention to citations numbers 238 and 239 in the third edition of Beauchesne's Parliamentary Rules and Forms. I take it that those citations rule against the reading of speeches in the house.

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July 3, 1944