October 17, 1951

IND

John Lambert Gibson

Independent

Mr. Gibson:

How abusive can you get here?

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CCF

Herbert Wilfred Herridge

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

Mr. Herridge:

Those, Mr. Speaker, are the more or less favourable comments that I have to make on the speech from the throne. It does appear to us, after reading the speech from the throne carefully, that the government does not intend to deal effectively with three matters of major importance and of great concern to a large number of Canadians. I refer particularly to the question of inflation and the rising cost of living; I refer to the demand of the veterans and many of their dependents across this country and many other Canadians for an increase in the basic rate of pension; and I refer to the great necessity for an increase in the war veterans allowance. I am sure that these omissions will be a source of great disappointment to a large number of Canadians in Canada at this time, and particularly to that section of our population that is suffering most severely from the high cost of living or that is suffering most severely from being in receipt of an inadequate pension or war veterans allowance.

I listened with a great deal of interest to the remarks of the Prime Minister (Mr. St. Laurent) the other day in reply to the Leader of the Opposition. I have great respect for the Prime Minister. I think the Prime Minister, from his point of view, honestly presented the situation as he sees it; and that was from the point of view of a Liberal who believes that, given time, circumstances will correct themselves without government interference or regulation. But so far as I could see, it was practically an admission from his point of view that parliament is helpless to deal effectively with inflation or with what I think the hon. member for Winnipeg North Centre (Mr. Knowles) termed the blind economic forces that are at play in the country today. I would say that it would be quite correct to say that the Prime Minister was on the defensive when he made that speech.

He was obviously not speaking with the usual fire and confidence that he has displayed on previous occasions. During his reply to the leader of the opposition he had reason to refer to a pamphlet published by the Labour party in Great Britain; and a very honest and objective pamphlet it was. The Labour party in Great Britain is facing great difficulties; it is facing much greater difficulties than is the government of Canada. That pamphlet was a frank presentation of those difficulties under present circumstances. But I do not think it was quite a sound support of argument to compare Canadian conditions with conditions in Great Britain. Price control has been of considerable success in Great Britain, and a great advantage to the working classes of that country throughout the years, and so have subsidies up till recent months. A country like Great Britain, where the great majority of the food is imported and the products they require to manufacture into finished goods are also imported, could no longer resist the external pressures of inflationary prices caused by policies pursued in other countries.

The Prime Minister also had occasion to refer to prices in the United States. I see the hon. member for Skeena (Mr. Applewhaite) laughing. He usually takes a more serious approach to this question. There are some members who do laugh at things, but he is much more serious. I am surprised to see him laughing at this time.

The Prime Minister had occasion to refer to prices in the United States. If I heard him correctly he was referring to prices in Washington, and from my information he was quoting one of the highest price centres in the United States. I think the figures he quoted were not figures that would indicate the price range on the average across the United States. My observations would lead me to believe that in some things the United States prices are much lower than ours, in some they are very close, and in some they are slightly higher. On the whole I think it is fair to say that the United States prices are on the average nearly equal to Canadian prices; but the point is that wages in the United States are much higher. Therefore, Mr. Speaker, I do not think it was a good argument to present the price range in the United States and compare it with the price range in Canada at the present time.

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LIB

Edmund William George

Liberal

Mr. George:

So is the productivity per man.

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CCF

Herbert Wilfred Herridge

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

Mr. Herridge:

The hon. member for Westmorland said: "So is the productivity per man". I cannot remember the publication, but one of the publications that support the Liberal party recently explained that in connection with some criticism of production in

The Address-Mr. Herridge Canada by saying the reason for that is there is 25 per cent more power per industrial worker in the United States available than there is in Canada at the present time.

I should now like to refer to an editorial which appeared in today's Ottawa Citizen entitled: "Comparing prices doesn't mean much." This editorial put the position rather neatly and I should like to quote briefly from it. It mentions that the Prime Minister was comparing United States prices with Canadian prices, and so on. Then the editorial concludes as follows:

The fact remains that, irrespective of what is happening in the United States, the burden of food prices and of many other things ranking as necessities or conveniences has become oppressive in the experience of a large segment of Canadians. Mr. St. Laurent prefers to swing the emphasis the other way. He says: "There is no doubt that certain sectors of our population are feeling some hardship, but not all sectors of our population."

This is undoubtedly true. The top end of the income scale is not feeling the pinch, nor a large part of the intermediate groups. Some wage earners may be counted among the relatively well-to-do. But others certainly are not; nor are thousands of clerks and other office workers- including government employees-to whom a rise of a point in the cost-of-living index is a matter of increasing gravity.

With reference to the Prime Minister's comparison of United States prices with Canadian prices I want to quote in addition from Time magazine of July 16. Mr. Eric Johnston, United States economic stabilizer, was quoted as saying:

"Under great inflationary pressures, you must have . . . direct controls. I'll give you one illustration of it, and that is Canada."

His point was that Ottawa's program of drastic fiscal controls was not going so well as the United States policy.

Before passing on may I say that we have given credit to the Prime Minister's sincerity as a supporter of undiluted free enterprise. Do not forget this: Free enterprise often takes credit to itself for the relatively high standard of living we have on the North American continent. I make the statement that the relatively high standard of living which is enjoyed by the people of the North American continent is enjoyed at the present time because of the vicious exploitation of the natural resources of the North American continent without any regard to the future. What can the free enterprise system do in Italy? What can it do in any country to raise the standard of living equal to ours without abundant natural resources? We are fortunate on this continent because we have great natural resources at the present time. Do not forget that our mineral resources are being depleted very rapidly, and there is no replacement of mineral resources. There is a

114 HOUSE OF

The Address-Mr. Herridge tremendous depletion of timber resources in this country, and a depletion of land resources by some improper farming practices and erosion. I shall have more to say on that point at some favourable opportunity. I must say that the subject of conservation is something of a phobia with me. I believe that this generation is not paying sufficient attention to the needs of the future generations in the development of our natural resources. The basis of our high standard of living is the opportunity to develop vast natural resources wastefully.

I want to bring another point to the attention of the house. I might say, Mr. Speaker, that this question of price control is a subject on which many in this house feel very keenly. It has been discussed many times, and therefore it is difficult to present the subject from any new angles or on a new basis; but it struck me the other day, when I was sitting in the house listening to the opening of the debate, what a strange thing has occurred when in the last two or three years you realize that the Liberals and Conservatives have practically changed positions with respect to the problem of price control. That is an interesting situation.

We all remember what the late prime minister, Mr. Mackenzie King, had to say. I shall not quote him as he was quoted recently by the hon. member for Winnipeg North Centre (Mr. Knowles). We all know what he bad to say with respect to the value of price controls and necessary subsidies. We are all familiar with the statements of Donald Gordon and many others. In addition to that we have Mr. Ilsley at page 3185 of Hansard of July 5, 1946, saying:

The war, and the experience of other countries, have indeed taught us the vital importance of keeping all inflationary pressures under firm control until supply and demand conditions are in a more normal relationship. The present Canadian program should strengthen our hands in that regard. We have removed uncertainties and simplified administration by preparing a specific list of goods and services whose prices are under control. We have reaffirmed the principles of price control, and of adjustments where necessity is proved, in respect of Canadian products.

Now, without a doubt during the war and after that period leading Liberal speakers, those in authority, and the government expressed their favourable opinions on price controls and necessary subsidies. On the other hand we find the Progressive Conservatives, who are the upholders of the free enterprise system, taking the opposite view at that time. I want to deal with that situation for a few minutes to indicate the oscillations in these policies and points of view within three years

of this parliament, and as showing almost a complete reversal of their points of view.

On February 3, 1947, at page 47 of Hansard Mr. John Bracken had this to say:

All the indications are that delay from now on in removing controls will cause constantly increasing difficulties. The moral of this is that the sooner these hindrances to production can be removed, the sooner we will get the advantage of free and full production.

Again on March 11, 1947, at page 1270 of Hansard, Mr. Jackman of Rosedale, a Progressive Conservative member, had this to say:

Furthermore, 1 do not think that if controls were taken off lumber-not export control but price control-we would find that lumber would go up much in price.

What a hope! I continue:

The people do have some respect for the purchasing power of the dollar: if they do not get good value they will refuse to invest, and it will be found that, instead of its being a seller's market, it will become a buyer's market.

The very opposite of that has been true. It has been for some years a seller's market, so far as lumber is concerned.

I happen to have something further in my notes, in error; but seeing that the hon. member for Lake Centre (Mr. Diefenbaker) is looking at me so intently, I take great delight in reading it. I refer now to Hansard for April 16, 1947, page 2099-and may I say that I think in this instance the hon. member for Lake Centre shows more statesmanship than some of his colleagues have shown. This is what I find:

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CCF

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

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

Mr. Knowles:

Will the hon. member permit one question before he takes his seat? Does he favour or disapprove the principle of price control?

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PC

John George Diefenbaker

Progressive Conservative

Mr. Diefenbaker:

I favour anything that will be

good for this dominion, provided the rights of the individual are protected.

What a masterpiece of statesmanship.

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CCF

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

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

Mr. Knowles:

But what did it mean?

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CCF

Herbert Wilfred Herridge

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

Mr. Herridge:

Then, on April 18, 1947, as reported at page 2185, the hon. member for Kamloops (Mr. Fulton) had this to say:

... in advocating the elimination of controls or now the lessening of controls, in spite of what was said about us as favouring big business-and that, of course, is not true-we are trying to do what we think will enable the small man, the man trying to get into business for himself now, better to do so . . . Indeed it seems to me that at the moment the trouble with the control policy of the government, or the stage at which it has arrived, is that it is only half a plan. It is half control and half decontrol and neither half is working. That is why we say the sooner you get rid of it, the better.

Then I find some shift of opinion in this respect in the Social Credit party. These are the words of the hon. member for Peace River (Mr. Low) as they are reported at page 1606 of Hansard for March 21, 1947:

Similarly, Mr. Speaker, it seems to me foolish to continue a rigid control of prices which was an

emergency measure designed mainly to restrict certain kinds of production. Rather it seems to me that by removing every possible barrier to it, production should be increased to the utmost in order that, through competition to please consumers, the control of prices will be exercised by the people through the things they have to buy.

That certainly has not taken place.

Social Crediters are implacably opposed to planned controls which enhance the power of the state at the expense of the liberties of the individuals of Canada. We vigorously oppose all such controls as vested in hordes of insolent bureaucrats authority over every phase of the lives of the people. Rather do we urge that as rapidly as possible wartime bureaucratic controls be removed.

And then, Mr. Speaker, I do not find myself in agreement with gentlemen who expressed themselves as follows in a brief by the Canadian Chamber of Commerce to the royal commission on prices on December 16, 1948:

To interfere with the function of prices can only result in the loss of political, economic and social freedom.

And then the Canadian Manufacturers Association, as reported in the Globe and Mail in January of 1947:

The executive council of the Canadian Manufacturers Association meeting in Toronto on January 28, 1947, called for removal of price control as soon as possible.

We find in this connection that the Progressive Conservatives at that time were vigorously opposed to price controls. Indeed, as my leader said the other day, no doubt their propaganda, their urgings, and the newspaper space given to that propaganda had some effect in increasing the rate of decontrol carried on by the Liberal party.

Then, this is what was said by the hon. member for Greenwood (Mr. Macdonnell) as reported at page 3221 of Hansard for July 8, 1946:

Under our system the duty of government is to create conditions to increase the number of those who will provide employment. There must be more enterprises, more people to take risks. For that there must be freedom for profits, too-

And that is exactly what we have had in the last five years, namely almost complete freedom for profits. And he continues:

-because that is the way to distinguish between efficiency and inefficiency.

That is the difference between efficient and inefficient gouging of the public. Then he says:

That is the way and the only way to get the maximum production in a free country.

The point is that under present circumstances the government has returned to the basic principle of free enterprise. That is the policy the Prime Minister (Mr. St. Laurent) emphasized the other day-that these conditions will correct themselves without government regulation or interference, if given time.

The Address-Mr. Herridge

But the Progressive Conservative party cannot take the same position and expect to have alternative programs to present to the people of Canada. That party is existing on the horns of a dilemma. Their economic theories are in direct conflict with public opinion on the question of inflation and price controls at the present time. So I presume that is why we have before us a Progressive Conservative amendment in general terms- although we do see the occasional Progressive Conservative advocating price controls in the country, as they have done in British Columbia and in other places. Generally they have been playing the question down to some extent and speaking in more general terms recently.

On one side we have the Progressive Conservative party, the Canadian Manufacturers Association and Canadian chambers of commerce in the past taking a definite stand against price controls and the continuation of necessary subsidies. I do not blame them. From their point of view, on the basis of their economic philosophy, that is a proper stand for them to take.

On the other hand I make the statement that we in this group are the only group in the House of Commons who have been consistent in the matter of price controls and subsidies, and their application to the needs of the Canadian people. I believe I am being quite fair when I make that statement. Our consistency is based upon an entirely different approach to economic questions.

At the present time the demands for price controls and for certain necessary subsidies is supported by the C.C.F. movement across Canada and, according to public opinion polls, by 70 to 80 per cent of the Canadian people, as well as by the Canadian Congress of Labour, the Trades and Labour Congress of Canada, the Catholic Confederation of Labour and the running trades-and I am referring of course to members of the railroad unions. In addition to these there are other groups, including veterans organizations, and some municipal councils.

Why do we see this vacillating policy of the Liberal and Conservative parties with respect to price controls and necessary subsidies, as opposed to our recognizedly consistent policy? All of us have a similar approach to parliamentary procedure, civil rights and matters of that kind. We are agreed pretty generally on those questions. The great difference of opinion in the house arises between those who hold that the basis of society should be the capitalist free enterprise basis and those of us, members of this group, and our supporters, who believe that we can do something consciously to

The Address-Mr. Herridge regulate the economic climate of this country, and that we in parliament can institute certain economic changes through the ownership of larger segments of the economy and through the control of other sections of it, by making certain that that private segment of the economy operates to the public advantage and good. We in the House of Commons, as the people's representatives, have the power and the right to do whatever is necessary at this time in taking the first step to bring order out of chaos in the economic sphere.

As I said before, the question of price controls and subsidies is not socialism. Do not forget that the days of free enterprise, as represented by the old parties, are past. That at any rate is my opinion. We will have either a regulated economy moving more and more to the right toward fascism, or we will have a regulated economy controlled by the people's representatives through our normal parliamentary and constitutional institutions that will be based upon ideas presented day after day by members of this group in the house, and in the country.

In my opinion at the present time the people of Canada are faced with a choice between those who have undiluted admiration for the free enterprise system, as represented by the Liberal party, and those who have seen the economic handwriting on the wall, as represented by the members of this group in this house.

We have this sharp difference because the C.C.F. is more than a political party or a political force in this country. We believe that the people should control, should have economic power through parliament. As I said before, this should be done through public ownership of a segment of the economy, through public control of a segment of the economy, and by ensuring that private enterprise serves the needs of Canada as a whole. In brief, we believe in economic planning and that this parliament has the power to lay down policies to give effect to that planning. We believe that human beings can consciously direct economic affairs to the general advantage of all. But, to do that, all people must participate. We believe that all the people of this country must be made partners in the methods and the functionings of democracy and that there should be real control by the people in the operating of our economy.

I think it is quite safe to say that at the present time the majority of the members of the Liberal and the Progressive Conservative parties believe that the law of supply

and demand is functioning and that in the long run it will operate to the satisfaction of the populace of the country, that given time things will correct themselves in the normal way. I want to give just one illustration to indicate what in my opinion is the fallacy of that argument. I am going to give some figures concerning the marketing of hogs on the Winnipeg public livestock market during the summer months of this year. I suppose I am taking hogs as an example because I have always had a kindly feeling toward pigs. I usually have kept a number of pigs and have taken great delight in feeding them. I assume it is natural for me to look at the price of hogs to see what the producer is getting and what the consumer is paying.

I intend to quote from figures which cannot be challenged. The prices of hogs marketed on the Winnipeg public livestock market during 1951 show the relationship between the prices paid to the producer and the prices paid by the consumer. I quote:

No. of Average

Hogs Price

Week ending Delivered per cwt.June 30, 1951 ... 1,486 $36.10July 28, 1951 .. 1,278 37.60August 25, 1951 ,.. 1,452 35.60Daily September 10, 1951 .. 685 $35.60September 11, 1951 .. 75 35.60September 17, 1951 ,.. 640 32.10September 18, 1951 .. 95 29.10September 19, 1951 .. 270 29.10September 20, 1951 ... 30 28.10September 21, 1951 ... 40 28.10

It will be noted that when there was a decline in deliveries there was also a decline in the price paid to the producer. While the number of hogs going into the market was decreasing, the price to the producer was also going down. During the same period the price to the consumer was steadily rising. I should like to quote from a news item which appeared in the Leader-Post of September 20, 1951, and reading:

There seems to be little apparent relationship between the volume of marketings and the prices received by the producer. Indeed, judging by the figures presented above, marketings at Winnipeg for the week ending July 28, 1951, when the average price received by the hog producer was $37.60 per cwt. actually exceeded the marketings in the week ending September 21, 1951, when the price dropped as low as $28.10 per cwt. The decline in prices has greatly exceeded the normal seasonal decline in price, and thus far, has been confined mainly to western Canada.

Another apparent anomaly exists in the relationship between retail price in June and present day prices. According to the dominion bureau of statistics, the average retail price for pork chops in Regina during the month of June, 1951, was 66-5 cents per lb. However, as of September 20, 1951, pork chops were retailing in Regina at 84 cents per lb.

1X7

Just before the producer was ready to make large deliveries of hogs to the market the price dropped to $28.10 while at the same time the price to the consumer rose steadily. Do you mean to tell me that this or any other Canadian government could not take action in a situation like this? We believe this government should take action. I have given these figures as an illustration that the law of supply and demand is not in effect at the present time. What we have is the law of monopoly and the control of natural resources, of markets and the prices. That is what is governing the Canadian economy at this time.

I happened to be scanning some papers recently and I found a rather interesting article entitled "Look Reports from Washington". As hon. members know, difficulties are being experienced in marketing apples at the present time, and difficulties have been experienced elsewhere in marketing other agricultural products. Many of our producers in Canada face a most uncertain future, vet I read this: '

The Food and Agriculture Organization of the United Nations has released a communique about what its technical experts are doing. "Thailand and Indonesia," FAO reports, "are at present receiving expert advice in stabilization of internal market prices of farm products." There doesn't seem to be any reason to doubt that as soon as the Thailanders and Indonesians learn how to stabilize their farm prices they will come over here and help us with ours.

Just imagine, through the United Nations we are sending experts to these countries to teach them how to stabilize prices. I quote that simply to show the ridiculous position we are in at the present time. We in this group believe sincerely that this government will eventually be forced to take action with respect to controls. I realize that no one likes controls; but in fact civilization has advanced only as we have learned selfdiscipline and collective discipline. I repeat, we believe that this government will be forced to take some action in the near future as a result of rising prices and the demands of the Canadian people. We believe in the regulation of things rather than the regulation of people. We ask the government to grapple with the problem of inflation, to establish price controls where necessary on commodities essential to the average family, to establish subsidies where necessary and to institute an excess profits tax to provide for the payment of these subsidies.

We urge the government to accept the offer of organized labour as represented by the Canadian Congress of Labour, the Trades and Labour Congress of Canada, the Canadian and Catholic Confederation of Labour and other groups which have offered to work

The Address-Mr. Herridge with the government and business to protect the standard of living of the Canadian people. The government should also consult with agriculture. An effort should be made to bring the representatives of labour, of agriculture, of industry and of business together with those of the government in an effort to solve some of the problems and get rid of many of the misunderstandings which exist today. I do not underestimate the difficulties created by the international situation and external affairs over which we have no control, but action such as this would give some hope to the Canadian people. Such a group could discuss these common problems and arrive at a mutual understanding. In doing that we would at least be taking some steps toward economic stability.

I want to deal with one or two matters that are of concern to the veterans of my constituency. I think one of the reporters for Saturday Night made a rather caustic comment in an article recently about members who deal with parochial issues. I want to say in reply that if the members of this parliament did not deal with parochial issues a good many of us would sit here year after year with very little understanding of conditions and circumstances throughout the whole country.

The veterans and their dependents and many others in the constituency which I have the honour to represent are seriously concerned about the government's failure to do something about an increase in the basic rate of disability pensions and about the increasing of war veterans allowances. During the lecess I had the opportunity of addressing a good many veterans and Legion meetings throughout my constituency, and also meetings of the ladies auxiliaries. I am very fond of the ladies auxiliaries; they do an excellent work. At these meetings there were supporters of all parties in this house, and they expressed their views, regardless of their political beliefs, in no uncertain terms with respect to the need for an increase in the basic rate of pension and in war veterans allowances.

I want to support the stand of previous speakers in this connection, but in order to be brief, as I see my time is fast slipping away, I shall quote from the September issue of The Legionary. There are two paragraphs which express very clearly the attitude of the veterans towards these problems. With respect to the disability pension. The Legionary has this to say:

A man who carries a handicap throughout his life -a handicap incurred in the voluntary defence of this country-should not be penalized if he has the

The Address-Mr. Diefenbaker courage and determination to overcome that handicap and earn a living. Anything less than an adequate increase in the basic rate of pension penalizes pensioners in this category.

In my opinion that is quite correct. I was a member of the veterans affairs committee.

I listened to the representations of the Legion and the national council of veterans, and as usual they were very sensible and responsible in presenting their proposals and supporting them with reasonable arguments relating to the cost of living, the increase in wages and the increase in prices. I hope that the government will take some action in that respect at this session. With respect to war veterans allowances for what are termed burnt-out veterans, The Legionary has this to say:

In all oUr considerations of this question we must not forget the extreme and urgent need of the '[DOT]burnt-out" veteran. War veterans allowance has presented and continues to present a difficult problem due in large part to the complexities attendant on the introduction of universal old age pension. But the present rates of war veterans allowance bear no relation to the cost of living. If $40 single and $70 married were considered necessary by the government in 1948, then obviously the $50 single and $100 married that the Legion now requests is very moderate indeed. It is essential that we do not lose sight of this need in our very natural anxiety over the basic pension rate.

I heartily support the Legion in their urgent request for an increase in the basic rate of disability pensions and in the war veterans allowance. Veterans legislation generally is a credit to this parliament and to the government. We think this failure to increase the basic rate of pension is an unnecessary blot on that legislation and a desertion of a pension principle that has been recognized throughout the country, for years. The veterans of this country and their dependents and large numbers of people who support their point of view expect the government to take action soon.

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PC

John George Diefenbaker

Progressive Conservative

Mr. J. G. Diefenbaker (Lake Centre):

Mr. Speaker, first may I join with the hon. member who has just taken his seat in support of the request, and that of tens of thousands of Canadians everywhere, that favourable consideration be given at this session to the veterans' brief presented to the government by the Canadian Legion. I listened with more than a little interest to the hon. gentleman who preceded me. He dealt at great length with the benefits of socialism and the shortcomings of private enterprise. I did not intend to become involved in that discussion when I rose, even for a few passing words, but having regard to the fact that he brought me into the discussion in one of his quotations I may be allowed a few words in reply.

[Mr. Herridge.l

My hon. friend pointed out the inconsistencies of others. I should like to draw his attention to the fact that we have in Saskatchewan a socialist government able to carry out many of the promises and principles which he enunciated but which, strange to say, they have not carried out. He referred in his quotations to 1946 and 1947. My recollection of those years was that many believed we were coming into a prolonged period of peace, that the days of international emergency were passing. We who believe in the principle of private enterprise, and believe we owe our standard of living in North America to personal initiative, were of the opinion that war emergencies no longer justified the crippling effects of socialistic practices that prevailed during the war. When so much is made of 1946 and 1947, my mind goes back to the statute book of Saskatchewan in which province on April 1, 1946-

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LIB

John Sylvester Aloysius Sinnott

Liberal

Mr. Sinnoil:

April Fool's day.

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PC

John George Diefenbaker

Progressive Conservative

Mr. Diefenbaker:

It was an appropriate date-legislation was passed by the legislature of Saskatchewan to control all prices and wages. It was to be proclaimed within one year. It was never proclaimed. It provided that everybody who broke the law would be subject to a fine, and in default of payment thereof imprisonment. I presume the reason that the legislation was not brought into force was that there would then have been only three classes in the community, those in jail waiting to get out, those in jail, and the rest of the people waiting to get in.

When my hon. friend speaks of the exploitation of natural resources and of the need of public development thereof, let me point out to him that the government of Saskatchewan has found that it cannot develop the natural resources of that province, the vast uranium and oil, by public enterprise. It has had to allow private enterprise to make the speculative expenditures necessary for development. It is so easy to say that socialist theories will work out, but the experience in my province has been that the promise of public development has been followed by the request of the government for private development within the province.

Then he also said: We believe in the regulation of things rather than people. What did he mean by that? There is a fisherman in northern Saskatchewan by the name of Ivanchuk. He had his equipment taken from him and impounded because of an alleged offence. For a month he was kept from carrying out his occupation. He asked to be charged, but he was not charged. The

government gave him back his equipment. This does not impress me as the regulation of things rather than people.

This session is one that will be known as the inflation session in which a supreme challenge to our way of life must receive the attention of parliament. Parliament must speak. Under our system of government, freedom can only live by means of continuous debate. The self-corrective in democracy is the power of parliament to exercise the power of fearless and effective debate, designed not to destroy political opponents but to arrive at conclusions necessary to the preservation of our way of life. I am impressed by the fact that in these serious hours and days the members of the Liberal party are not taking their part in the debate. Caucus cannot take the place of parliament. This is a matter that affects each and every one of us.

The Prime Minister (Mr. St. Laurent) has announced that all parliament is to do to meet inflation is to consider the passage of legislation regarding fair trade prices. The Minister of Justice (Mr. Garson), who is not present and for that reason I hesitate to mention it, last night gave his version of an anti-inflation policy. He said, in effect, "Please write me a letter and tell me what is wrong". That is hardly enough in days such as these. Parliament lives because of the opportunity it gives to members to debate the issues of the day, untrammelled and uncontrolled, and unfearful of an overwhelmingly powerful government. I have before me an editorial which appeared in the Saskatoon Star-Phoenix of June 13, 1951, entitled "Is Parliament free"? It says this:

We do not suggest that the cabinet has enslaved this parliament but we think there are dangerous symptoms pointing in that direction. It is as much the duty of the government as of the members to see that the disease does not spread. The government members have a particular responsibility in this regard.

Then it points out that on occasion members in the house have seemed to place party unity ahead of the wishes of their constituents.

The two hon. members who opened the debate gave interesting speeches, and I congratulate them. The member for Beauharnois (Mr. Cauchon), with that capacity for language which he possesses, spoke effectively in both English and French. The member for Yukon-Mackenzie River (Mr. Simmons) gave us a picture of the north country which I am sure parliament will not soon forget. What seems to be lacking is any serious endeavour by the government to meet the problem of inflation, ballooning prices-one could call them "balloonatic" prices. Prices are mounting day by day and week by week. Over the years there have been the promises of

The Address-Mr. Diefenbaker cabinet ministers that we have hit the price limit. When the index level was about 145 or 148 they said prices were levelling out. From time to time government ministers would indicate that we were arriving at a time when at least a degree of hope would be restored to the men and women on small incomes, the pensioners, and to that great body of people within our country whose income is small.

The Prime Minister made a speech, obviously a difficult one for him to make. Here was a great counsel presenting an argument on behalf of the government, but the best one could say for it was that it was a milestone of defeatism in meeting the problem of inflation. He made a comparison of our prices with those in Washington. The Prime Minister said that there is no doubt that certain sectors of our population are feeling some hardship, but not all sectors. The fact is that the purchasing power of the Canadian dollar is dropping faster than it is in the United States. According to a Canadian press report in October, the Canadian dollar declined 6-4 cents in the year against a decline by the United States dollar of 3-8 cents.

The cost of living index is now about 190, and still going up. For the farmer the situation is even worse than for other people in the community. The index of things the farmer has to buy has gone to 217-4. Hardship is being wrought upon our people and parliament is here to meet the situation. What a variety of suggestions have been made by the government to meet it! One minister says taxes and more taxes. Another says purchase less and save. There has been a policy of wait and see, while true income shrinks. The government has contributed much to this increased cost of living. Last March and April when hon. members on this side of the house unsuccessfully asked government supporters to join them in opposing the increase in the sales tax from 8 per cent to 10 per cent, the ministers' answer was that it would not raise the cost of living appreciably. It has. Some ministers say in effect no price controls yet but possibly some time, thereby benefiting those who are "all set" as the Minister of Trade and Commerce (Mr. Howe) said.

Has government policy to meet inflation been of any use? If it has, the undiscriminating eye cannot see it. There have been increased interest rates, discouragement of bank loans, postponed depreciation allowance, higher taxes, and yet the inflation increases.

The Free Press in an editorial says it- -must come as a sharp and surprising disappointment to the government. It had expected that retail

The Address-Mr. Diefenbaker prices, having levelled off, would remain fairly stable during the next few months at least. ,

This editorial appeared on July 9, 1951.

It continues:

It must be remembered, however, that the deflation policy launched in February with increased interest rates, the discouragement of bank loans, postponed depreciation allowances and then higher taxes unavoidably must take some time to show its effects.

It had not been expected in Ottawa that the full results would be clear before midsummer. The retail price figures for June and July, therefore, will be awaited with interest.

Where June and July price levels were revealed further increases in price levels were shown. Surely if ever any government for a period of five long years has shown its ineptitude in prophecy as to prices, this government has done so. I have a great many quotations here but I am not going to burden the house with them, going back to 1946, 1947 and 1948. Here is one in January, 1948, when the Minister of Finance (Mr. Abbott), speaking in New York, said:

It is possible that there might be selective reimposition of price control but that will depend on what parliament decides and what may happen down here.

That was referring to the United States in 1948. The Prime Minister at about the same time made a speech at a Liberal luncheon in Quebec and he said:

A power chain exists in Canadian prices and the greed for higher prices and profits will have to be curbed.

And he said: "We know that and we are working on it." That at least was positive. Then the Minister of Finance, on February 14 in Brantford, is reported in the Toronto Star as having stated in an interview that there were indications that inflationary pressures might now have done their worst and that prices might be sagging down from their peak.

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LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. Abboti:

They did, too.

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PC

John George Diefenbaker

Progressive Conservative

Mr. Diefenbaker:

Sagging, Mr. Speaker?

The Liberal federation met in 1948 also; it had some suggestions and I read from the resolution of February 10:

The government should be prepared to take any steps necessary to prevent profiteering, to control unjustified prices and to keep the cost of living at the most reasonable level consistent with national welfare.

Next they said:

Monopolies and special privileges have no place in a democratic state in which the principles and policies of liberalism are applied.

Then you will recall, Mr. Speaker, that finally as a diversionary movement, a committee of parliament was set up in 1948. At that time the cost of living was around 150. The longer the committee sat the higher went prices. A royal commission was set up and

the longer the royal commission sat, the higher went prices. The Prime Minister, the Minister of Finance, and the Minister of Justice have recently indulged in a trilogy of radio speeches in which they have set forth what should be done now. They produced a blueprint, a well-starched anti-inflationary program last November, and then another one in February; but still prices have continued to rise. The Minister of Finance still stands for the old principle: tax, and tax, and tax. The Minister of Justice, however, has his own policy as enunciated last night. This is to operate in co-operation with the policy of the Minister of Finance and that of the Prime Minister. He asks those affected by injustice to write to the combines commissioner. I venture the opinion that the Minister of Justice with that suggestion brought to the Post Office Department a source of income that will do away with the deficit.

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LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. Abbott:

I hope the hon. member is right.

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PC

John George Diefenbaker

Progressive Conservative

Mr. Diefenbaker:

Finally it ends up in this way:

If, in this connection, you think I can be of any help, by all means write to me.

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?

Some hon. Members:

Oh, oh.

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PC

John George Diefenbaker

Progressive Conservative

Mr. Diefenbaker:

Mr. Speaker, when I heard those tones going over the radio last night, I just wondered whether the letters that he would receive would be mislaid or even hidden, as was the communication that he got some two years ago from Mr. McGregor regarding the flour milling combine.

The Minister of Trade and Commerce also made a speech. He said in effect that the government do not want to do anything that will not be successful which would push people around. That was a new sentiment for him, Mr. Speaker! The Prime Minister has announced that the only thing to be done at this session regarding high prices is to bring in some legislation regarding the setting of resale prices by the wholesaler or the manufacturer to the retailer. I can conceive of no lighter foot than that one being put on the brake of inflation. They have had a similar suggestion before them for years.

In 1926 the Proprietary Articles Trade Association of Toronto was declared to be a combine because it did that very thing, in a report from the combines branch dated October 24, 1927. The Curtis royal commission in December, 1948, pointed out that "the growing practice of resale price maintenance" was a matter of serious concern.

If it was a matter of serious concern then, why was not something done about it since then? The United States supreme court this year ruled that price maintenance is not

enforceable as between non-signers, price maintenance being a policy by which an individual manufacturer of branded goods prescribes the price at which they are to be sold, both to the wholesaler and to the retailer.

Does any minister of the crown say that such a bit of legislation is facing up to the problem confronting the Canadian people? The Prime Minister does not do so. In effect he says: It is good as far as it goes, but I do not think it will go very far. What about the small and independent merchants? I suggest that such legislation-and I speak only for myself-if introduced, and price maintenance represents less than four per cent of retail sales in this dominion, can have an effect exceedingly detrimental to the independent, small businessmen in this country. The larger outlets, with lower unit overhead costs, may conceivably, under this legislation, secure a monopoly that will put out of business the small man dealing in nationally advertised goods. Surely the government has something more than a picayune promise of an alteration in the law under which even now, if price maintenance were in effect as between a group of manufacturers or wholesalers and individuals, it would be an offence against the combines act. I suggest that the anticipated legislation is simply a smoke screen to conceal the lack of an effective policy to meet inflation. Since 1946 the government has hoped that things would turn, out all right, has procrastinated with promises of future action and has failed to act. Why has not the government investigated the spread between the price the consumer pays and what the farmer receives for so many commodities?

Much was said by the Prime Minister about the cost of foods. The hon. member for Calgary East (Mr. Harkness) dealt with one product in his speech, namely, meat. He showed that there was-and his figures have not been challenged, and therefore after this time can be accepted-too great a disparity between the price the consumer has to pay and the price paid to the farmer. Why has there been no investigation into price spreads and the blame placed on those responsible? Why is the Combines Investigation Act not going to be brought before the house at this session with a view to having it looked into and suggestions made by hon. members from all parties?

A commission-the MacQuarrie commission -was appointed on June 27, 1950, to review the act. The only report it has made is the report on fair price practices. The Minister of Justice asked for that report on September 10. Surely there is no one here who will contend that when any monopoly corporation operating a combine, however powerful it

The Address-Mr. Diefenbaker may be, or any group of individuals break the law-and I refer not to honest business, I refer to individuals however powerful, who break the law-they should be allowed to do so with impunity. The penalty under the combines legislation is a fine of $10,000, a fraction of what the illicit gains may be to those who by design evade the law and exploit the public. Ten thousand dollars! If you were to say to those engaged in robbery, we will take three or four per cent of what you make, we would not be discouraging robbery. After all, one judge of this country has found that that is what certain gains were-as the law against combines now stands-it is robbery. Potential profits great; potential penalty picayune.

Why should not the combines act be brought before a committee of parliament and changes made to make the breaking of the law less encouraging? The combines legislation is not being effectively enforced by this government. There have been a few prosecutions where the gains were tremendous, but a maximum fine of $10,000 is no deterrent. The Minister of Justice, who is charged with the responsibility of enforcing the act, called on the Canadian people last night to write to him, please. How many investigations have there been in the last year as the result of the minister asking the combines commissioner to investigate? Not one. No investigations were made as a result of ministerial direction or formal application during the past year. That is from the annual report of March, 1951. That does not indicate that the government is facing up to its responsibility.

I suggest first and foremost that if the act is not adequate for the job it be revamped so that Canadians who are being exploited unjustly will know that the law will protect them if enforced. The Saskatoon Star-Phoenix in an editorial entitled "Tighten up on Combines", says:

There is no reason why the present legislation should not be used to its maximum extent. The consumer needs the protection of the combines act more now than at almost any other period of our history. Yet our government is caught with its legislation to restrain monopolies out of repair.

There has been a failure on the part of the government to put teeth in the penalty clauses so that the penalty for wrongdoing would be commensurate with the crime committed. I do ask the government to do something regarding inflation; to use the law now on the statute books, not as a feather duster, but as an instrument to strike fear into the hearts of those who unjustly take advantage of the people or, to use the words of the Minister of Trade and Commerce (Mr. Howe), who having been all set to take advantage are unlawfully profiteering.

The Address-Mr. Diefenbaker

Newspapers across this dominion have asked that government revamp the Combines Investigation Act. An editorial in the Star-Phoenix on October 4, 1951, reads:

The amount of money involved is not large enough in relation to the potential profits to discourage fresh attempts to control competition in other ways.

Surely the act should be used in the fight against inflation. The failure to use the report against the flour milling industry having been concealed until prosecution could no longer take place makes Canadians wonder whether this government is doing so.

I want to make a short reference to the agricultural situation. The hon. member who preceded me said that hon. members must mention matters peculiar to their own part of the country. What I wish to deal with now is not parochial; it affects every farmer in western Canada. The situation is most serious. In the other place yesterday Senator Wood dealt with the matter at length. The harvest hopes of a few months ago have been diminished by continued rain and snow. Storage is at a premium; in fact, it is not available. As an encouragement to the western farmers to make the expenditures of building storage facilities I suggest that payments should be made for storage on the farms. The other day the Minister of Trade and Commerce said that it would come out of the farmer. Not at all. It would simply be an advance to him of moneys that he ultimately would receive when the final payment was made. When the farmer's wheat is stored by the elevator companies 1J cents a month is paid for the storage which is an expense to the farmer.

My second point is that loans should be made available to farmers on wheat in farm storage. The United States has that system in effect. The Commonwealth Credit Corporation grants loans up to 80 per cent or 90 per cent of parity, and, in addition to that, makes loans up to 85 per cent of the construction costs so that the farmers can build their own storage structures.

There is need for something to be done to increase the prices and thereby avoid the terrific loss that the western farmer is sustaining under the international wheat agreement by reason of having to sell his wheat under that agreement at 50 cents a bushel less than at the world market price. I believe there is every justification for the western farmer to ask that the wheat sold for consumption in Canada should be on the basis of the world price rather than on the basis of the price in the international wheat agreement. The international wheat agreement has lost for the Canadian farmer, to date, well over $100 million. He has received

no stability of prices-unless one is content to call prices far below world prices "stability". The one stability it provides for is that his loss is stabilized at around 50 cents a bushel.

I have before me a number of letters on the point, some of which were received today. These deal with the recent order of the wheat board allowing farmers anywhere to store their wheat at whatever elevator and where-ever space is available. This is working an injustice against many of the small farmers whose elevator facilities in their local towns have been filled from farms in districts many miles distant. The result is that, owing to the lack of sufficient freight cars, the situation has been intensified locally for them.

The Saskatchewan retail merchants association has given support to the need for the provision of local farm storage, and of advances being made on the basis of that storage. It is all very well to be optimistic regarding the western farm and storage situation; but I say it is serious. We are going to have well over 100 million bushels of almost unsaleable wheat by reason of recent rains and climatic conditions. Surely provision should be made for the assured storage of that wheat which is of better grade.

Finally, in that connection, without exception farm organizations are asking for a reduction in the differential in price between numbers 2 and 3 wheat, and numbers 4 and 5 wheat. The differential is altogether too large and should be lessened.

The speech from the throne says that some further consideration is being given to the question of the Saskatchewan river power and dam project. A commission has been set up. The press in Saskatchewan, generally, is agreed, as are the people, that it is most unfair to have continuous stalling taking place in connection with the project. It has been found feasible and is necessary for defence purposes and for the development of the province.

The commission will review what officials operating under the Prairie Farm Rehabilitation Act have found, as well as what engineers appointed by the government have found. As is pointed out by the Leader-Post, this indicates needless duplication. Nothing would do more to restore a degree of hope in those areas which, while not this year affected by drought, have been seriously affected in other years, than to have the government take action now.

This project should not be made a political football. There is not a member from Saskatchewan who does not support it. The

Minister of Agriculture (Mr. Gardiner) has promised it. The leader of the opposition (Mr. Drew) has given his undivided support to this project. I do not want to have it held back until the next provincial election. The project is needed in Saskatchewan, and I am deeply disappointed that in place of performance the speech from the throne provides for a promise of re-examination by experts.

The project would pay dividends and nationally it would be self-liquidating. It would assure diversified industries for the province. It would preserve us from fear of recurrent droughts, in an area of some 500,000 acres.

This is an inflation session. If we do not act effectively at this session of parliament, and if the ascent of ballooning prices continues, I fear for the future of our country. Our defence projects cannot achieve success unless this problem is met. Surely the intelligence of the House of Commons can produce something more than the promised amendment to the Combines Investigation Act. .

The great base upon which inflation flourishes will remain if all parliament does is to pass another law which I fear will join the limbo of forgotten things.

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Robert Fair

Social Credit

Mr. Robert Fair (Battle River):

Mr. Speaker, before proceeding with the remarks I had intended to make this afternoon I wish to comment briefly upon some observations made by the hon. member for Kootenay West (Mr. Herridge), who preceded me earlier this afternoon. At that time he made reference to the stand taken by the Social Credit party on the question of price control.

I have sat in the House of Commons for almost sixteen years, and I cannot think of any group more subject to criticism for its change in stand than the C.C.F. party, to which the hon. member for Kootenay West has been recently readmitted. I feel that had he had the intelligence of ordinary people he would have had no difficulty at all in understanding our position with respect to controls.

Now and in the past we have refused consistently to accept controls just for the sake of controls, as he and his associates have advocated and continue to do. On Monday last my leader, the hon. member for Peace River (Mr. Low), had this to say, as reported at page 54-I hope the gentleman who was criticizing us will take the time to read this over once again:

We Social Crediters are convinced that a system of over-all direct price controls, with all the regimentation and restrictions it entails, is the very negation of the democratic way of life. That is the

The Address-Mr. Fair first point. We further believe that as long as Canada continues to participate in the numerous international organizations to which she is now committed, such as NATO, Bretton Woods, the United Nations, the Colombo plan, and so on, the cream of Canadian production is likely to be given away externally, leaving in our country effective demand for which there is no balancing supply of consumer goods. In that situation pressures for price rises are inevitable, particularly if large corporations continue to pile up inventories so that those goods are not released to the Canadian public. It is our conviction too that as long as we continue to operate under the present financial and economic system this country cannot maintain a condition of full employment, even in peacetime, without some price control arrangements. Until proper financial and economic reforms are established in Canada to take care of the situation on a long-term basis, it may be necessary to adopt certain price controls, as has been advocated by both opposition speakers who have preceded me this afternoon. We would support such a temporary measure, and note that I say "temporary"; I am quite sure that the leader of the opposition at any rate, and I think perhaps even the hon. member for Rosetown-Biggar (Mr. Coldwell), would agree that it should be a temporary measure, to bring our people relief from the present terrific high cost of living, until we can get things balanced down to a decent level.

I think that should be quite clear to anyone who wishes to understand. I hope the hon. gentleman who has not been able to understand it up to the present time will read it once again. Before going further I should like to express appreciation on behalf of the Lloydminster united municipal hospital district to the Minister of National Health and Welfare (Mr. Martin) and the government upon the grant that has been made to assist in the extension of that hospital. I have paid taxes to support this hospital for a number of years and I believe it has rendered good service. Because of an increase in population the hospital was not large enough and for a number of years the matter of providing additional accommodation has been a headache for the hospital board.

Recently the hospital district provided a certain amount of money, as did the provincial governments of Alberta and Saskatchewan as well as the dominion government. The new hospital wing was opened officially by the Hon. Mr. Bentley who sat here to my right between 1945 and 1949. During the official opening he stated that it seemed rather strange but most encouraging that people on both sides of the meridian, those who supported a C.C.F. government in Saskatchewan and those who supported a Social Credit government in Alberta, as well as representatives of the dominion Liberal government, were able to work together to build that hospital wing. Again I want to express the appreciation of the Lloydminster municipal hospital board to the minister and the government.

The Address-Mr. Fair

Another matter that has created considerable discussion over the years is the provision of pensions for those over 70 years of age without a means test. While this legislation has not yet been introduced we hope that it will be introduced, as indicated in the speech from the throne. At the last session we passed legislation providing pensions for those between 65 and 70 years of age but with a means test. I hope that in the near future, as in the case of those over 70 years, that means test will be removed.

I am not satisfied with the amount of the pension because when compared with the value of the dollar in 1939 the $40 is now worth only $21.16. Anyone who has visited the stores lately will readily realize that $21.16 or even $40 is not sufficient today to maintain any reasonable standard of living. As a result of government policy in the past number of years-this government has been in office since 1935-the savings which many people had accumulated have now largely melted away, with the result that they must rely on their friends or obtain assistance through pensions or by other means. In my opinion that should not be allowed to continue in a country like Canada. In addition to the legislation to be brought in this session providing for a pension without a means test for those over 70 years of age, I hope that in the near future we will have other legislation increasing the rate of pension to a reasonable amount.

Another matter with which I should like to deal is the basic pension for war veterans and the war veterans allowance. I think that disabled veterans have a moral and legal right to a much larger pension than they are enjoying at the present time. Nearly a year ago the Canadian Legion presented a brief to the government and last session we had a special committee on veterans affairs. Up until that time this committee has always done a good job, but I cannot agree with those who voted last session against increasing the basic pension and the war veterans allowance. They had a responsibility to veterans which I do not feel they carried out. Of course they were only carrying out government policy.

A disabled veteran must live with his disability twenty-four hours a day, seven days a week and fifty-two weeks a year. In the past he offered his services to protect our freedom. Those of us who stayed at home enjoyed security and there were many Canadians who took advantage of the war profits that were available. I feel it is now up to us to do our duty towards the disabled veteran. There is no question about this country being able to afford the 33J per cent increase for which the Legion asked.

In my opinion that request was most moderate and should have been granted without any bickering, either by the committee or by members of the house. In the past we have sent millions of dollars' worth of goods to other countries and at the present time we are spending billions of dollars on defence for a war that may or may not come. It is true that at the last session a supplementary estimate of $2 million was brought down to provide an allowance for single men with a disability of 35 per cent or better and for married men with a 45 per cent disability or better, but the records show that this allowance will better the financial position of only 6,000 out of the 165,000 who are affected.

That was not approved by the committee. At least there was no unanimous vote. I believe all opposition members and some of the government members, who recognized their responsibility and acted upon that recognition, voted against the proposal. I hope they will see to it this time that this is continued as time goes on.

When these pensioners go to the store to buy things they have to pay the full price, and to a very great extent the price is the responsibility of the government. I shall deal with that later on. Pensioners receiving old age pensions are not eligible to partake of the benefit arising from the $2 million supplement. They must be unemployed, must be unemployable, and in addition must furnish proof that their disability is a factor contributing to their unemployment. Those things bring about a vicious means test which is no part or parcel of disability pensions. That was ruled out many years ago and should continue to be ruled out, but because of government policy it has cropped up again. Apparently they want the money for some other purpose or perhaps they want to keep the veterans on a lower standard of living so that they will be easier to deal with. Such a practice should not be carried on.

More sympathetic treatment should also be accorded to these veterans when considering the question of old age pensions. The veterans affairs committee of last session recommended that this matter be brought forward again at this session. I understand that no committee is being set up but there is nothing whatever to hinder the government from introducing legislation, or regulations if they want to, to increase those pensions.

With respect to the war veterans allowance recipients, there was a demand last session that something be done about that also. At the present time single men are receiving $40 and married men $70. The request of the Legion was that these amounts be

increased to $50 and $100 respectively. If that had been done they would now be receiving the equivalent of $26.45 for a single man and $52.90 for a married man in terms of 1939 dollar value. I believe that this matter should be taken care of during the present session. Cold weather is already approaching and the suffering of these old veterans is continuing. It is our responsibility to see that something is done, and I wonder what the members of the house will do about it. Will they discharge that responsibility?

There is another group not already mentioned, the old soldier settlers. They bought land away back in 1919 and 1920, and since, and I believe there are nearly a thousand who are still struggling to pay off their debts. I understand the amount still owing is slightly over $1 million. A rough computation will indicate that if each citizen of Canada contributed 7 cents these debts could be wiped out entirely. We had a vote on this question last session and I was very sorry to see that some members voted against providing relief. However, if there is any hon. member of the house who will refuse to pay his 7 cents at this time I will dig into my limited savings and pay the 7 cents for him. I hope something may be done during this session.

One of the main questions facing the government at the present time is that of inflation, with which is very closely associated the high cost of living. The Prime Minister (Mr. St. Laurent) dealt with it the other day, and he made a speech which to many people was surprising. He dealt with the British Labour party's pamphlet entitled, "This Cost of Living Business". I am not going to deal with that now. It does not concern us particularly. We could make quite a lot of comment on it if we wished to but I am not going to take the time now. The Prime Minister dealt with the legislation that the government intends to introduce at the present time. At page 35 of Hansard he said, with respect to the fixing of resale prices:

This problem has been carefully studied by a committee appointed to do that job, a committee composed of highly respected persons felt to be qualified to examine the problem objectively and to make a report upon it. They have done so, and that report is now before parliament, but I am sure that when any legislation based upon that report is being considered there will be arguments pro and con the probable effects of Interfering with this so-called light of the producer of an article to determine the price at which it will be resold to the ultimate consumer.

Then he goes on to say:

I am not sure myself that that is not already contrary to provisions of the Combines Investigation Act, because the act defines a combine as a conspiracy between two or more persons to fix the resale price of commodities.

The Address-Mr. Fair I hope the Prime Minister will get together with the Minister of Justice (Mr. Garson) and settle the point as to whether such price fixing is really a combine. As has already been pointed out this afternoon, if legislation is brought down and passed I am not sure that it will be used, because we remember that only a couple of years ago the government had a report of an inquiry as to certain people who were supposed to be guilty, and the report was pigeonholed for many months before being brought out into the open. Let us hope this legislation will have some effect. I am not sure about it, but it would appear that there are some people who have a feeling of guilt because since the speech from the throne was made on the 9th of this month, a week ago yesterday, three stores in Hamilton have brought down prices and have openly announced through the press that they are breaking contracts with their suppliers. An article in the Ottawa Journal of October 13 states that a Montreal drug firm is seeking an injunction over price fixing. Another article in the Ottawa Citizen of the 16th of October states that Toronto stores are cutting the price on electrical appliances, and an article in the Ottawa Journal of October 15 is headed, "Hose Costs Run Down". Nylons of a certain grade are coming down in price.

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Charles Edward Johnston

Social Credit

Mr. Johnston:

No garters.

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Robert Fair

Social Credit

Mr. Fair:

One of my friends says, "no garters" but I do not think that is the whole explanation. Apparently certain people feel that there is a little guilt connected with the prices that have been in existence, and I hope that the government will not stop until they do something worth while with respect to this matter. The Prime Minister went on to give a list of articles and their prices at Washington and Ottawa. I was very glad to have the Prime Minister make that comparison because certain people in Canada, many of whom should know better, have been charging the primary producers of this country, the farmers, with being responsible for the increased cost of living. Many of them know very much better but in order to distract attention from their own businesses and themselves they try to place the blame on the farmers. At page 38 of Hansard for October 15 the Prime Minister went on to say:

There is no doubt that prices are high.

There is no doubt that certain sectors of our population are feeling some hardship, but not all sectors. In spite of high prices the average wage paid in our manufacturing industries will buy more today than it did before the war.

The prices that our farmers are getting for their produce, in spite of the fact that they are paying higher prices for things they have to buy, Is giving them a larger share of the national income at this time than ever before.

The Address-Mr. Fair

Now, that is a whopper of a misstatement, but I am not charging the Prime Minister with responsibility lor it. Some of the experts, perhaps in his office or some of the departments, gave him that information which, in my opinion, is entirely incorrect. I shall deal with that when I have finished this quotation.

I am not saying that is not as it should be. I notice an hon. member shaking his head but let me say that he is not the only one who knows the farmers in this country. I know farmers in various parts of Canada and I know for a fact that at the present time they are getting a larger share of the national income than they ever got before. I am not saying that they should not. I am not saying that they are getting too much. I know that they work hard for what they get and I feel that the prices they are getting under present price levels are not too high and that it would not be fair to try to roll them back.

Had the Prime Minister insisted upon getting proof of those statements, he would have found that the dominion bureau of statistics records show that during the period 1915 to 1919 the farmers of Canada, comprising at that time 33 per cent of the population, received one-third of the national income. What did the farmers of Canada, who comprised about 25 per cent of the population, receive in 1950? Yesterday I called the proper official in the dominion bureau of statistics and what do you think his reply was? They received 9-95 per cent of the national income. The 25 per cent living on the farm received 9-95 per cent of the national income. If the Prime Minister had gone a little further, perhaps he would have found out that the other people in Canada are receiving more for their dollar today than they did back in 1939. The Prime Minister had this to say:

... I have here figures showing the estimate of food quantities which one hour's work of a manufacturing employee at average wages would buy in certain periods. While the first item is not disappointing, it does show that in October, 1939, an hour's work would purchase more sirloin beef than it does at the present time.

I am just going to use the figures for 1939 and June 1951. The figures are as follows:

June

1939 1951

Sirloin beef 1-6 1-1Bacon lbs. 1-3 1-7Eggs 1-2 1-6Potatoes 228 39-1Bread 7-3 9-9Tea [DOT]7 i-iCoffee lbs. i-i i-iSugar, granulated ... lbs. 6-8 90Butter 1-4 1-7

At the same time had the Prime Minister gone a little further with his research he could have found out that in both 1919 and 1920 an eight foot McCormick-Deering horse-drawn binder could have been purchased for

$190. At that time the farmers were receiving for itheir wheat $2.63 per bushel which meant that it would take 72 bushels to purchase the binder. In 1951 when we were receiving approximately $1.90 for our wheat that same binder would cost us $640, so it would take 337 bushels of wheat to buy it. Those figures show that it takes four and one-half times as many bushels of wheat ito buy a binder today as it did back in 1919 or 1920.

Then perhaps I should place on record a statement made by the president of the Canadian Federation of Agriculture which I am taking the liberty of quoting from the text of the Prime Minister's address. He had this to say:

Food prices are not high in relation to other prices or in relation to wage rates or to the profits being made by industry. Most food, in terms of the hours of work required to purchase it, is cheaper than it has ever been. When we compare average hourly earnings in manufacturing industries with average prices of staple food products, this fact is borne out.

There are many other things contained in this address with which I do not intend to deal. I believe the figures I have given, and the statement of the president of the Canadian Federation of Agriculture, should be sufficient. In spite of these things, we can look back over the crop years 1946 to 1949 and see the sort of deal the farmers got under the British wheat agreement. Again let me emphasize that this was a deal between the Canadian government and the British government. The wheat board must not be blamed for the making of that agreement. The farmers lost approximately $311 million in this deal, even though they got that much talked about $65 million from the government. Instead of only that amount being taken from the treasury, an additional $311 million should have been taken because under the agreement the wheat was a gift to the British people by the Canadian government on behalf of the Canadian people. Full payment to those who supplied the grain should have been made, the federal treasury supplying the difference between class II price and those prices obtained under the agreement.

Many so-called experts have dealt with this matter. In the issue of Maclean's magazine for May 1 there is such an article, and in the Edmonton Journal I have noticed an article recently by R. J. Deachman. He has put out his shingle as an economist and has been raising a little cain about this $65 million payment. From the tenor of these articles I think we might say of the authors, as we can of many others, that a little learning is a dangerous thing; drink deep, or taste not the Pierian spring. They are, deliberately

or otherwise, trying to fool the Canadian people. In addition we find there has been quite a drop in hog prices recently, and had I sufficient time I should like to deal with that. It has been shown that, from the middle of September until about October 6, Ontario hog producers have lost nearly a million dollars as the result of a price slump. There are many other things with which I might deal, but time will not permit. We fully expect that there will be another session next spring, at which time we shall be able to deal with some of these matters.

The government has undertaken to prevent inflation. Almost a year ago they decided they would curtail bank loans. Then they were going to restrict credit. That means that the- purchase of many necessary items has been restricted. Many people who wanted to buy cars, refrigerators, washing machines and many other things have not been able to purchase them because of that restriction of credit. Then they said that another way to get the money out of the people's hands would be to increase taxes. They increased the sales tax from 8. per cent to 10 per cent, a 25 per cent increase; and the excise tax was boosted from 15 per cent to 25 per cent on many items. The result has been extremely hard on the Canadian people. Many of us complain bitterly about the price of our cars and other things we have to buy. The result of the sales tax and the excise tax on the poor man's car-which is the kind I drive; it is a little Chevrolet-amounts to about $700. In addition we have many other taxes that are levied on parts coming in from the United States.

The government are passing measures to bring about a reduction in the cost of living and the prevention of inflation, and in my opinion they themselves are the big offenders. It is about time that change in their program was made effective. Then they have increased interest rates. After doing all of these things -most of which are detrimental, in my opinio11-they ask the people to work harder and to produce more. Increased production, provided that other suitable measures were also applied, would be a good way of preventing inflation and bringing down the cost of living, but with the methods applied by the government up to the present time I do not think they can expect particularly effective results.

While dealing with wheat I had intended to suggest that even though we have the wheat growers, the farmers, in general being treated as they have in the past-and the government has been made aware of that condition time after time-we still find that the international wheat agreement means a loss to the Canadian wheat grower of an average of, I would say, 40 cents per bushel. In my opinion that

The Address-Mr. Fair is not good business. I am not for a moment, however, suggesting that an international wheat agreement is not a good thing. I voted for it, as did other members of this group. But an international wheat agreement or any other agreement is not good enough unless you make provision in the price program for changes that may occur in the price of the things the farmer has to buy. While the hon. member for Acadia (Mr. Quelch) tried, when the international wheat agreement was before the house, to have the government provide for a fluctuating price that could be brought about by tying the price of wheat sold to other countries to the price of goods in those countries, he was not successful. Indeed, the government never even took the trouble, as far as I know, to investigate that proposal. But had that been done it would not make any difference whether the price of wheat was high or low, for it would bring back to our country the same quantity of goods from other countries.

In connection with the price of wheat that is turned over by the wheat board, on government instructions, as government policy-the wheat turned over to millers for milling into flour for Canadian consumption-that price again is set at a figure the same as that for the wheat sold under the international wheat agreement. In my opinion, it is adding insult to injury to have that amount stolen from the farmer; because that is exactly what is taking place. On every bushel of wheat turned over to the millers by the Canadian wheat board for Canadian consumption the farmers are losing 40 cents on an average. While I have on many occasions asked the Minister of Trade and Commerce (Mr. Howe) what those wheat growers are getting in return, he has never-nor has any other member of the government-even made an attempt to give me a satisfactory answer to that question. I feel that until some of those injustices are remedied, things will not be very good.

I had intended to deal with the question of income tax, particularly as it relates to farmers, and its administration in the prairie provinces, but I see that time will not permit me to do so. However, there may be another opportunity when I shall be able to deal with that matter.

In dealing with some of the things that might be done at the present time I am going to quote six points which have been placed on the record by my leader, the hon. member for Peace River (Mr. Low). They can be found at pages 54 and 55 of Hansard of Monday last. Before doing that, however, I should point out that the Prime Minister is finally realizing that certain things can be

The Address-Mr. Fair done; and those are things we have advocated for the past sixteen years. As reported at page 41 of Hansard he had this to say:

The price level cannot be held fixed in a free economy, although it is disturbing to have it move far in either direction. Deflation, when it comes about, is almost as painful as inflation.

Then he makes this admission:

The ideal state would be a proper balance between purchasing power and supplies;-

I am glad the Prime Minister has got along even that far in recognizing the way the economy of our country should operate. He continues:

-but none of us-except perhaps the hon. member for Lethbridge (Mr. Blackmore)-has the formula by which to maintain that proper balance at all times.

The hon. member for Peace River made those six points to which I have made reference, and I am just going to give a short .quotation from them:

1. Overhaul of the taxation structure.

I have perhaps dealt sufficiently with that point, and I see that my time has almost expired.

2. We advocate holding out every possible inducement to all sections of Canadian society to increase their productive efforts. We believe that the greatest single factor in bringing down the general price level is a plenteous supply of consumer goods for home consumption. Let me make that clear; a plenteous supply of consumer goods for home consumption, not piled up in somebody's inventory, not produced to send to some other place, but a plenteous supply of consumer goods for home consumption.

3. We believe we should couple with a wise taxation policy a system of consumer price discounts or subsidies on selected items which enter into the daily needs of the majority of Canadian people.

I am not going to deal further with that matter at this time. It has been enlarged upon by the hon. member for Peace River.

4. Our fourth suggestion is that whenever it becomes necessary to expand the money supply of Canada the government should not add to the debt burden on the people by borrowing from the chartered banks. Rather the government should ask its own treasury and the Bank of Canada to create and hand over the new supply of purchasing power, interest free, to be spent into circulation by the government for the essential needs of the situation.

5. The fifth proposal we make and which we think the government should adopt-I have pleasure in noting that the throne speech does mention certain measures that are to be taken at this session- is the institution of a wise policy of control of combines and monopolies so as to ensure a full measure of economic competition in Canada which we think is most important if we are to bring prices down to a reasonable level.

6. As a sixth point we think there should be a wise and fair investment policy governing industrial expansion and resources development.

Time will not permit me to say any more at this time, but I hope that there will be another opportunity a little later on.

Topic:   SPEECH FROM THE THRONE
Subtopic:   CONTINUATION OF DEBATE ON ADDRESS IN REPLY
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October 17, 1951