November 2, 1951

?

Some hon. Members:

Yea.

Combines Legislation

Topic:   COMBINES LEGISLATION
Subtopic:   MOTION TO ESTABLISH JOINT COMMITTEE TO CONSIDER INTERIM REPORT
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LIB

Elie Beauregard (Speaker of the Senate)

Liberal

Mr. Speaker:

Those against will please say nay.

Topic:   COMBINES LEGISLATION
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?

Some hon. Members:

Nay.

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LIB

Elie Beauregard (Speaker of the Senate)

Liberal

Mr. Speaker:

In my opinion the yeas have it.

And some members having risen:

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LIB

Elie Beauregard (Speaker of the Senate)

Liberal

Mr. Speaker:

Call in the members.

Mr. Speaker put the question as follows:

On the motion of the Minister of Justice (Mr. Garson) to set up a committee to study combines legislation, and the like, the hon. member for Lake Centre (Mr. Diefenbaker), seconded by the hon. member for Vancouver -Quadra (Mr. Green) moved:

That the resolution be amended by deleting from the first paragraph thereof the last clause, namely- "and to consider appropriate amendments to the Combines Investigation Act based thereon", and substitute the following:- "and to consider generally the Combines Investigation Act and to recommend appropriate necessary amendments thereto which will assure protection against exploitation of small businesses and consumers."

I ruled the amendment out of order, in that it purported to confer on the committee wider powers than those set down in the original motion. From my ruling the hon. member for Lake Centre and others appealed.

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PC

Gordon Graydon

Progressive Conservative

Mr. Graydon:

I was paired with the

Secretary of State for External Affairs (Mr. Pearson). Had I voted I would have voted against Your Honour's ruling.

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CCF

Angus MacInnis

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

Mr. Angus Maclnnis (Vancouver East):

Mr. Speaker, the motion of the Minister of Justice (Mr. Garson) now before us is, in part:

That a joint committee of both houses of parliament be appointed to consider the interim report of the committee appointed to study combines legislation, tabled in the House of Commons Friday, October 12, 1951; and to consider appropriate

amendments to the Combines Investigation Act based thereon.

For various reasons I am going to try to keep pretty close to the question at issue in this debate. One reason is- that I have only a limited time, and I am not a fast talker. Let me say first of all that our main objection to the resolution is that it delays action upon a question that has been before committees of parliament and committees in this country for a quarter of a century. There is nothing we can find out about resale price maintenance that we do not know now. Because of that we believe the proper thing for the Minister of Justice would have been to introduce the legislation forecast in the speech from the throne, and then leave it to the House of Commons to decide what should be done with it. The matter of resale price maintenance is not altogether a question of the effect it has on the cost of living. Even if prices were falling I think there is sufficient evidence before us to indicate that resale price maintenance should be declared illegal. From the evidence before us in reports from parliamentary committees and royal commissions I think I can prove that in so far as it can be proved.

However, from the point of view of the cost of living, I think the action of the government at the present time is a terrific let-down to the people of this country. Little or nothing has been done since the end of the war, since prices began rising, or in any case since the committee on prices was appointed in 1948, and there was hope that some small relief might be coming. Let me draw the attention of the house to the reference to this matter in the speech from the throne. I shall not quote the whole two paragraphs, but only sufficient to show how the government saw things on October 9. The speech said:

The concern of our people over the rising costs of living resulting from international and domestic inflationary pressures is fully shared by the government.

The second paragraph reads in part:

The government has received an interim report from the committee studying the combines legislation recommending that suppliers of goods should be prohibited from requiring or inducing distributors to resell such goods at fixed or minimum resale prices.

It is clear that it was the intention of the government to introduce legislation to that end. I need only quote the concluding words of the speech by the Prime Minister (Mr. St. Laurent) in the debate on the address in reply to the speech from the throne. He said, as recorded at page 41 of Hansard:

That is the situation; and again I can say that as regards immediate additional measures to curb inflation, while others may develop, the only one we are prepared to submit at this time is the one that will arise out of this report of the combines committee with respect to resale prices.

Then he went on to say:

I do not think that is going to have a very substantial effect on the index of the cost of living.

I agree that it would have no great effect. It might have some, but it would have no great effect on the cost of living. However, the people of this country were hoping that something might be done. Various parliamentary committees and royal commissions appointed by the government have drawn attention to resale price maintenance, and have recommended that the practice should be made illegal. Now the government is going to appoint another committee. We of this group are not going to agree to any further stalling in this matter, and we do not care from where the attempts to stall come.

The purpose of the proposed committee, as I have stated, is to study the interim report of the MacQuarrie committee, and to make recommendations with respect to legislation. The Minister of Justice (Mr. Garson) quoted the terms of reference of that committee, and I do not need to do that. He also mentioned that the government considered the matter

of resale price maintenance so important that it asked the MacQuarrie committee to make an interim report on the subject to the House of Commons. That report was made. This was the approach of the MacQuarrie committee to the question of resale price maintenance. In the introduction to the interim report which I have in my hand, I find the following:

By what standards should resale price maintenance he judged a desirable or an undesirable practice? They can be suggested in simple form by two sets of questions. First, does the system place the determination of prices, which is the mutual concern of producers and consumers, under social control either through competition or public regulation or does it set up a system of control by private law or agreement? Does it prevent the consumer from exercising his full influence in determining what services he is willing to pay for and what services he deems too expensive? In brief, does the system facilitate or restrict competition?

I think the answer to that is clear. I continue:

Second, how does the maintenance of resale prices affect prices, production, distribution and consumption? Does it promote efficiency in the economic system providing the consumer with the goods and services he requires at the least necessary prices? Does it direct adequate but no more than adequate resources to the distributive system? This is the standard of economic efficiency.

After studying the question from that approach the MacQuarrie committee proposed two simple amendments. I say they are simple. They are simple and direct. When the government received them it intended to introduce legislation in the house to put them into effect. What happened? During another debate I asked whose still small voice it was that spoke to the leader of the opposition (Mr. Drew) and induced him to change his attitude on price control. I now ask whose was the still small voice that whispered in the collective ear of the government and resulted in the Minister of Justice deciding to give us another committee instead of introducing a bill as was intended? What evidence can we hear that has not already been heard with respect to this matter? In the introduction to the interim report the MacQuarrie committee had this to say:

As indicated above, the committee received a great many briefs, nearly all of which made some reference to resale price maintenance. They reveal divergent opinions on the subject. Although there are some notable exceptions, in general the associations representing manufacturers, wholesalers and retailers favoured resale price maintenance.

May I point out that these are the people who are everlastingly complaining about government bureaucrats setting prices, about government interference with the ordinary economic principles of business; but here they themselves, because they have control in their hands, want effective control of prices, and they have been getting it. It

Combines Legislation

appears that they are going to continue to get it until there is a government in this country with enough courage to put a stop to it. I continue:

On the contrary, co-operatives, labour unions, farmers' and consumers' associations expressed opposition to the practice.

If we set up a committee the same people who appeared before the MacQuarrie committee and stated they were in favour of price maintenance and the same people who stated they were opposed to price maintenance will appear before us and say the same things. Where will we be then?

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CCF

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

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

Mr. Knowles:

Another royal commission.

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CCF

Angus MacInnis

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

Mr. Maclnnis:

Perhaps we will have

another royal commission. The Minister of Justice has already given us the names of the members of the MacQuarrie committee, but I should like to repeat them. The chairman is Mr. Justice MacQuarrie of the supreme court of Nova Scotia. The other members are Dr. W. A. Mackintosh, who is now president of Queen's university; Professor Maurice Lamontagne, of Laval university, and Dean George F. Curtis, of the law faculty of the university of British Columbia. A justice of the supreme court of one of the provinces, two learned professors and the head of the law department of another university, and they proposed two simple amendments to this government; now the Minister of Justice brings in a resolution to set up another committee to consider those two simple amendments.

Let us see what the Minister of Justice had to say on this matter. He made a radio address in "The Nation's Business" series on October 16, 1951, just a little over two weeks ago, and referring to the appointment of this committee he said in part:

We did this because it seemed advisable, after twenty-five years of operation, to have the combines law reviewed in the light of experience and of the changes that had occurred in our commercial practices. The committee was given unlimited authority to recommend any amendments which it thought would make the law a more effective instrument for encouraging and safeguarding our free economy.

The committee proposed two simple amendments. What was done with them? They are being referred to another committee. The report continues:

The committee's general conclusion is that the enforcement of minimum resale prices is contrary to the public interest and should be forbidden.

The committee specifically recommends that it should be made an offence for a manufacturer or other supplier:

1. To recommend or prescribe minimum resale prices for his products;

2. To refuse to sell, to withdraw a franchise or to take any other form of action as a means of enforcing minimum resale prices.

Combines Legislation

In other words the committee decided that the time had come when private interests in this country should not be administering a private code of law from which there was no appeal to the courts of the land. The Minister of Justice is not sure he agrees, and he refers it to a committee. The minister went on to say:

May I say In conclusion to my listeners that if you or your friends believe that prices are being held up by practices which seem to be contrary to the combines law, do not hesitate to write to the combines investigation commissioner in Ottawa and ask him to look into the matter for you. He is provided with a competent staff for just this purpose, and as a citizen you are entitled to his assistance. If in this connection you think I can be of any help, by all means write to me.

The thing the minister should have said was, "By all means write me and I will refer it to the Minister of Trade and Commerce, or I will refer it to a committee." By all means write to the Minister of Justice. I should like to quote from the report of the royal commission on prices which I believe was presented on March 18, 1949. The commission was set up on July 8, 1948, and gave considerable time-it cost considerable money also-to the study of resale price maintenance. On page 258 the following appears:

Resale price maintenance has been dealt with in a number of investigations under the Combines Investigation Act, but usually in conjunction with other restrictive practices. It was the sole issue in one inquiry, that into the Proprietary Articles Trade Association. Two reports were published, in 1926 and 1927, in which conclusions were expressed that the public interest was detrimentally affected. The Proprietary Articles Trade Association was disbanded shortly after the Anal report was published. The same conclusion was reached in the following investigations which dealt with certain aspects of the problem: tobacco, 1938, dental supplies, 1947, optical goods, 1948, and bread in western Canada, 1948.

With all that evidence before him, and after having appointed a committee made up of outstanding (Citizens, some of them high in the legal profession, the Minister of Justice has the effrontery to come to this house, after having told the people of Canada that the government would give effect to the recommendations, and move to refer this matter to yet another committee. Someone said that the report of the MacQuarrie committee has been repudiated. I believe in effect that it has been repudiated. In any case not much importance is being given to it. I would think that there are good reasons why these gentlemen should resign their membership in that committee. It must be remembered that they are only beginning their work. They have to deal with many other aspects of the Combines Investigation Act. If every recommendation they make to the government is going to be

referred to another committee, what confidence can the government have in the judgment of that committee? It is simply a ridiculous situation.

Let me give now a number of quotations from the report of the royal commission on prices in 1949. I have already referred to it in connection with this matter. I shall quote from page 27, volume I:

During our inquiry we tried to ascertain whether there has been any marked growth of restrictive business practices during the postwar period and whether the effects of these practices on competition had played a major role in raising prices.

Among the industries on which we report, we found a number where conditions were highly competitive. A good example was the primary livestock industry, in which there are a very large number of producers, no one of whom handles more than a small fraction of the total output. On the other hand, we found a number of industries where competitive forces were limited because of the small number of firms in such field. For instance, there are only three firms in Canada manufacturing primary fertilizer materials and the very high capital investment required for this industry makes it difficult for new firms to enter this field. Another example occurs in primary textiles-

I understand that the textile industry of this country is highly protected by tariffs, among other things.

-where a few big firms dominate the cotton industry and where the three producers of the three types of synthetic yarns manufacture the entire Canadian output.

Then on page 28:

Resale price maintenance, like other forms of restrictive practices, does offer what appears to the manufacturer and distributor to be a happy relief from the unending struggle against the harsh correctives of the free market system.

I have said time and time again in this house that no one in this country believes in competition, that is for himself. People believe in it for the other fellow, of course. Everyone who can get away from the "harsh correctives of the free market system" will get away. If this government believes in free enterprise, and it says it does; if manufacturers in this country believe in free enterprise, and they say they do, there is one thing this government can do to see that industry in this country is free. It can prevent such practices as resale price maintenance-and that is only one of several kinds of unfair sale practices-from being continued. It cannot be done by merely referring this matter to another committee.

The prices commission report continues:

But the solution we think is illusory. It not only vitiates the spirit of enterprise by which all commercial and industrial life is nourished, it deprives the consumer of his right to seek out and patronize the more efficient distributors, namely, those who over a period of time can offer goods for sale at prices lower than their competitors.

Underproduction may also result where there are only a few firms in the field and the spur of competition is not very strong. An example of this may be seen in the primary cotton textiles industry, where production has been decreasing since the war.

We hear in speeches made all over this country, and even in this house, that what this country needs is more production. But if more production is not profitable to the textile industry, for instance, you are not going to get more production. There will be just as much production as is profitable to the owners of industry, as long as a few industries have control. For years we have been telling the members of this house that today it is not a question of control or no control; it is a question of who is going to exercise the control, the manufacturers and wholesalers or the government, which at least has a responsibility to the people of this country. There is one other quotation from this report that I should like to give the house. If the Minister of Justice (Mr. Garson) has not read it, then he should read it. If he has read it he should read it again. It is found on page 41:

Throughout our inquiry we have been impressed by the degree to which individual manufacturers fix the resale prices of their products and so narrow the area in which price competition amongst wholesalers and retailers is operative. In view of the extension of this practice, we recommend that the combines investigation commission give careful study to this problem with a view to devising measures to deal with it.

Evidently the combines people did not have a sufficient staff to deal with this matter, or the Minister of Justice or the government-I do not want to restrict it too much to the Minister of Justice-did not have confidence in the Combines Investigation Act staff. They wanted to get a new opinion. They obtained a new opinion, and that new opinion recommended simple legislation which the government was going to put on the statute books until they heard the master's voice.

Let me draw your attention to another report. This is the report of the 1935 royal commission on price spreads. The question of price maintenance was not dealt with under that heading to any extent. In my opinion the practice did not become prevalent until some time later. On page 228 the commission has something to say about competitive practices in the retail trade:

Whether or not certain practices are unfair cannot be based solely on the opinions of a single trade or of those who believe themselves to be injured parties. The only basis upon which business practices can be classed as unfair is in relation to the public interest. If certain practices can be shown clearly to be against the public good, they should be condemned as unfair even if they benefit certain trade groups. On the other hand, practices which

Combines Legislation

benefit the public, even though they work a hardship on some groups, cannot be classed as unfair merely to protect such minorities.

I have received, as no doubt many other members have, many letters opposing legislation forecast in the speech from the throne. I wish I had known earlier that the government was not going to do anything about it, because I might have saved myself a little political opposition and a considerable amount of dictation. But I did think the government would do something about it. They said so, and who am I to doubt that they would? In reply to these letters I therefore said that it was my intention to support this legislation but I am not stating definitely until I see the bill. I am glad I had the sense to safeguard myself at least to that extent. The amazing thing in connection with nearly all these letters was that those writing them did not realize that they were not free businessmen carrying on their own business as they saw fit. As to these items of their business, they are merely the agents of the manufacturers, selling on commission. Yet they talk about this free country of ours whose people the socialists are going to put in strait-jackets, when every one of them is in a strait-jacket now and has not sense enough to know it.

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LIB

James Sinclair (Parliamentary Assistant to the Minister of Finance)

Liberal

Mr. Sinclair:

Page the hon. member for Moose Jaw (Mr. Thatcher).

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CCF

Angus MacInnis

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

Mr. Maclnnis:

Let us now get back to the report of the MacQuarrie committee.

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?

An hon. Member:

Hear, hear.

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CCF

Angus MacInnis

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

Mr. Maclnnis:

The hon. member says "hear, hear"; but the government does not want to have anything to do with the committee's recommendations. All they want to do is refer them to a committee. I want to draw the attention of the house to the committee's views, and I quote from page 18 of the report:

Resale price maintenance, to be effective, requires some method of enforcement. If a manufacturer merely indicates a resale price but makes no provision and takes no step to enforce it, then he has no real control over his distributors. However, when measures of enforcement are involved, resale price maintenance establishes a private system of law allowing no appeal to the courts of justice, as it is clearly shown in the British white paper.

It seems to me that what this house has to decide and what this government should decide is not whether this measure has the effect either of raising or lowering prices, but whether these people have set up private courts of law in which they themselves are the sole judges. That is the question for free people-and I assume that we are still free- to discuss and to decide in this house.

Combines Legislation

The committee gave this quotation from a statement on resale price maintenance, from a British board of trade white paper:

It is worth noting, too, that a trader who, by charging too little for his goods, incurs these penalties at the hands of a trade association (or manufacturer) has no recourse to any higher authority: by contrast, a trader who charges too much and is proceeded against by the state, under price-control laws,-

And I would ask hon. members to note this: -can always appeal to a higher court.

When you have government-imposed price controls, if you think you are not getting a fair deal you have an appeal to the courts; but when the matter is under the control of private manufacturers you have no appeal at all. As a matter of fact, you cannot open your mouth; for if you do, they stop supplying their goods. The quotation continues:

The penal proceedings which may have the effect of driving a shopkeeper out of his trade and which are directed not to the maintenance of a recognized standard or code of behaviour generally accepted as necessary in the public interest, but solely to the enforcement of a particular trade policy of questionable merit, take place behind closed doors and without any supervision by the courts or by parliament.

I wish that statement would sink into the minds of cabinet ministers and private members of this house. I have one more quotation. It is found on page 19:

Finally, it should not be forgotten that, to the extent that resale price maintenance brings more rigid and higher prices, it contributes to the instability of production and the reduction of sales, results which serve neither the interests of manufacturers nor general welfare.

There you have the point of view of the committee; indeed it is under that heading in the MacQuarrie interim report. Does the government accept that, or does it not? If it does not accept it, it should tell the MacQuarrie committee to go home and apply themselves to work that they are competent to perform.

In the general conclusions of the MacQuarrie committee are set forth, as I say, two simple recommendations:

The committee, therefore, recommends that it should be made an offence for a manufacturer or other supplier:

1. To recommend or prescribe minimum resale prices for his products;

2. To refuse to sell, to withdraw a franchise or to take any other form of action as a means of enforcing minimum resale prices.

Why any Minister of Justice, any government or any parliament should refer that kind of recommendations to another committee is simply beyond my understanding. The recommendations are so simple, so direct and, I think, so much in line with what every member of the government must believe, that

(Mr. Maclnnis.]

it just amazes one to see the government balking at putting before this House of Commons so simple a matter.

As I have already pointed out, this question has been under study in this country for a quarter of a century, and it is time we finished with it and decided the matter. We should either decide that resale price maintenance is a perfectly proper business method, or we should decide that it is not a proper business method and pass legislation to stop it. Let us see what we have had in the past two years. We had a parliamentary committee. We had a royal commission. Then we had this MacQuarrie committee of outstanding Canadian citizens. Numerous studies have been made by the combines investigation commission. Now we are to have another study, this time by a joint committee. In a recent issue of The Montrealer there was an item which I am taking the liberty of paraphrasing-and I did not change it a great deal-as follows:

The government laboured and produced a board.

The board laboured and produced a committee.

The committee laboured and produced a subcommittee.

The subcommittee laboured and produced a recommendation.

And the recommendation was referred to a joint committee.

If I were speaking in biological terms I believe I could say that at least we have reached the stage where we should have something, even though most of the committee, I suppose, are getting well on in years. But unfortunately it is not a biological matter. We shall have to appoint another committee to find that out.

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CCF

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

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

Mr. Knowles:

Refer it to the Senate

members of the committee.

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CCF

Angus MacInnis

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

Mr. Maclnnis:

If the committee on divorce had nothing else to do they could attend to it. It seems to me it was the intention of the government to bring in legislation to give effect to the recommendations of the MacQuarrie committee. The Canadian Chamber of Commerce had a meeting in Quebec. They passed a resolution urging delay in this matter, and next day the resolution in the name of the Minister of Justice appeared in Votes and Proceedings. I am not of course suggesting that there is any connection between what took place at the convention of the Canadian Chamber of Commerce and the appearance of the resolution on the order paper, but I must draw to the attention of the house the fact that it is a rather interesting coincidence. There is definitely an indication of his master's voice in what has taken place. I do not think, sir, that what this house or the country requires at this time is another committee, even if

it is a joint committee. As I have fully and clearly demonstrated, we have all the information on this matter that we need to take the action that was proposed by the MacQuarrie committee. What is needed at this time is a government that would have the courage to protect the small people of this country. We cannot get that through another committee.

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SC

Solon Earl Low

Social Credit

Mr. Solon E. Low (Peace River):

Mr. Speaker, the people of this country were led to believe that the government really and truly meant business when in the speech from the throne itself two clauses were found as follows:

The concern of our people over the rising cost of living resulting from international and domestic inflationary pressures is fully shared by the government. Every measure will be taken which my ministers believe will be effective in counteracting inflation without impairing our free institutions. The anti-inflationary measures already in force have checked the upward trend of prices of goods and services affected by their operation.

The people of the country had good reason to expect vigorous action on the part of the government to take care of these two situations. Thus far the people have been bitterly disappointed, because they have not seen the vigorous action. All they have seen are indications of a timorous diffidence on the part of the government to try to do anything about this whole situation. It cannot be described in any terms other than timorous diffidence. The hon. member for Lake Centre (Mr. Diefenbaker) described it in picturesque words as leadership in retreat. Perhaps that is true. It sounded good, and perhaps fixed the situation pretty well. I wonder just what the people are thinking, and I am'going to quote briefly from two editorials from widely separated sources. If I just quoted from the editorial in the Financial Post of October 13, 1951, it might not mean very much. I presume there would be those who would say at once "Well, that is from the master's voice". I am not sure, but I am going to quote it just the same, and then I shall go right out to the grass roots, right out amongst the people in the farthest and most remote places. This is what the Financial Post had to say about the very matter that we are discussing today:

The government's avowed intention of legislating on resale price arrangements is not impressive.

Well, as the hon. member for Lake Centre would say, that is a real understatement. It certainly is. The editorial continues:

It is true that the high cost of living is the problem uppermost in the popular mind. But it looks very much as if the government is going to make a big show of "doing something" about the high cost of living by tilting against resale price agreements.

Combines Legislation

Then they go on, Mr. Speaker, to explain some of the resale price agreements, and they finish up in this way:

Actually in Canada most of the "price maintained" products are in industries where competition between different brands is sharpest, hence where the effort has been most strenuous to keep prices down.

So this move, if described as a method of hitting high prices, is just eyewash.

The second reason this plan is objectionable is that it can't be enforced-not even reasonably well, either in letter or in spirit. And laws that can't be well enforced both in letter and in spirit are better never passed. They are thus merely corrupting to the governors and the governed.

That is the opinion of the people who edit and manage the Financial Post down here in eastern Canada. I now want to go out into my own country, perhaps as far away from Ottawa as one could get, and find out the reactions of the people. I am going to quote from the Peace River Record-Gazette of October 25, an editorial under the heading: "Is price fixing a red herring in Canada?" This is what the editorial says:

Considerable publicity has been given of late to two matters of general interest to the person who pays the bills, namely, price fixing and cost of living. To date nothing has been done about price fixing, although some action has been promised, while in the matter of cost of living anything that has been done does not appear to be very effective. All of which leads us to question the sincerity of the federal government in the matter and causes us to wonder whether the furore about price fixing is not being brought before the public in an effort to confuse the issue and draw fire from the cost of living question.

Anyone who tries to solve the cost of living muddle is in for a busy time, for immediately they are faced with the question of why prices are going up and labour and management point accusing fingers at each other. On the other side of the fence the government hesitates to put into force new regulations which in turn necessitate more civil servants and additional cost, not to mention the cost of subsidies which the people through their government would have to pay.

The question of price fixing now occupies the centre of the stage and likewise proves intriguing. It would seem the government has timed things neatly in that the findings of the recent combines hearing against western bakeries coincides with the government's attack on price fixing. Any query on price fixing must include the question of who gets hurt most if price fixing does not exist; by price fixing is meant the setting of retail prices for specific zones by the manufacturer, with the price limited to the figure set. When the market is going up the public is protected from those who would raise the price sky high, while when prices drop the merchant is given protection against price cutters. Whether this principle is in the best interests of the nation's economy must be considered, taking into account the consumer and the retailer.

Anyone whose memory can recall events of a few years ago will remember the days when price cutting was the order and merchants cried out for some semblance of law and order in the matter of prices.

As a result we have provincial legislation dealing with the matter as to the floor on such price cuts. It would appear some of the manufacturers and retail industries are being used in an effort to

Combines Legislation

becloud the general issue of prices and the cost of living, and it would be well for our members of parliament to try and study the matter from a long-" range viewpoint, for such laws should not be changed by governments to suit particular conditions with which they are faced.

I quote this article to show what the people of Canada are thinking about the government's inaction today in the matter of high living costs and prices. If you wish to find out what they are thinking you have to get right back among the people, the common ordinary folk. The editorial I quoted from the Peace River Record-Gazette appeared in a paper that does not support me or my party. It tries to remain independent in its views. They are expressing, however, exactly what the people of this country think about the latest move on the part of the government, which appears in the resolution now before the house.

I leave it at that for the moment. The resolution we are considering does call for a joint committee to study the report and recommendations of another committee, namely the MacQuarrie committee. When a proposal like this is made by the government-and, by the way, such proposals have been made more frequently of late than I have known for some time-it always leads me to believe that the government is stalling for time. I believe there is every evidence in the present situation that it is stalling for time. I do not know what their reasons are. Those reasons are best known to themselves, and I am hoping the Minister of Justice (Mr. Garson) will let us in on some of those reasons before the debate is concluded. My genial friend sits over there and smiles back. I think that is wonderful; generally I applaud when he does that. He does not become angry at these onslaughts. Just the same, however, we would like to see him rise in his place and tell us what have been some of the reasons for this stalling. Let him take us into his confidence. Let us see behind the scenes so that we may know what has been going on.

Whatever the cause may be, the course the government is now taking cannot be interpreted as anything other than a repudiation of the MacQuarrie committee's report. I think the hon. member for Lake Centre (Mr. Diefenbaker) must have been pretty close to right when he made that statement. Otherwise we would have had here today a bill instead of a proposal for a committee. Surely on a matter so important as to be included in the speech from the throne, and promising definitely that members of the House of Commons would have before them at this session legislation dealing with this whole price-fixing situation, members of the house ought to have been able to look

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forward with confidence to such legislation being brought before us at an early date. But what do we get? We get only a proposal for another committee wherein members of this house and of the other place would study the MacQuarrie committee's report, which is a rehash of a great many other reports and investigations that have gone on for years.

How in the world are we ever going to reach any termination of these things? How can we get action in that way? The resolution certainly does not foreshadow any legislation at all. It will simply mean a long drawn out series of hearings and discussions from which, of course, nothing much by way of corrective action can possibly be expected.

On the other hand it may be necessary to have changes in the manner and method of merchandising in Canada. I do not think anyone doubts that at all. One could take all afternoon discussing possible changes. Surely, however, the government must know by this time where there is price fixing that is contrary to the public interest. Surely, with all the investigations that have been carried on, with all the commissions and committees that have dealt with this matter over the years, the government ought to know where today there is price fixing that is in restraint of free trade. To say that what we need is a committee is just to make a mockery of parliament. It puts us in the position of grade III school children. We are given something just to occupy our time. I think that is most reprehensible at a time like this, when the people of this country want action. I do not think it is becoming on the part of any minister of the crown to ask the house simply to degenerate into a bunch of school children; not for one second.

If committees in the past have been of any use at all, then the government should now have before it well defined legislation designed to correct the situation. If there were some areas in which they have been uncertain, I cannot understand why they would delay, why they did not come right out and say, "We are not certain that we can frame legislation which will cover the whole field of resale price maintenance, and do it satisfactorily." For example, why did they not come out and say, "We have discovered some difficulty in bringing in this legislation, because certain representations have been made to us indicating that perhaps resale price maintenance by agreement between manufacturers and retailers does result in keeping prices down, and we are faced with this problem in attempting legislation that will adequately and fairly cover the situation". Probably the government has come to the conclusion that there are certain

instances where price maintenance does benefit the general consumer in Canada. I . am sure I could put my finger on a number of them. I am sure that if all these agreements were to be abolished we would see an upward trend in the prices of a great many things. I do not think there is any question about that.

But why does not the government come clean and tell us that it is not yet certain? It would indicate that they have not been doing their homework; I do not think there is any doubt about it. All the information is there before them, and they could have studied it. I believe the delay, and the appearance of this resolution before the house today, indicate only one thing; that is, that the government is not greatly concerned about this whole business of prices and the cost of living. What else can we conclude from what has happened?

I think that legislation is very important. I do not want to repeat the ground covered so well by the hon. member for Lake Centre (Mr. Diefenbaker) and the hon. member for Vancouver East (Mr. Maclnnis). I find myself going along with them, and in sympathy with what they said; and they said it much better than I could. The hon. member for Lake Centre, with his rapier-like methods, was able to put the Minister of Justice (Mr. Gar-son) right on tenterhooks. I do not think that can be doubted. And I am going to be interested to hear what the minister has to say in reply. I do not want to multiply those words interminably, but I do say it is necessary for us to speak the mind of the people we represent. I know what my people think about such legislation. They are calling it a red herring. They are calling it a deliberate method of sidestepping necessity for action.

In my judgment the setting up of this committee will do nothing whatever to lower prices for the consumers. The work of the committee will not in any way increase the volume of goods available for purchase by the people. As a matter of fact I think it might have the opposite effect. The hon. member for Lake Centre (Mr. Diefenbaker) in his interesting address this afternoon mentioned the article that appeared in the Ottawa Citizen last night headed "Manufacturers Shelves Loaded With Goods". I am going to ask the Minister of Justice (Mr. Garson) this question: What will the committee's work do to get these goods that are now loading the shelves of the manufacturers into the hands of the consumers of this country so they can use them? What will this committee's work do to prevent a further increase in inventories in this country that may be detrimental to the people? In my judgment

Combines Legislation

the withholding of goods from the general public is just as bad as price fixing. People suffer just the same, and perhaps worse. The article reads in part:

Manufacturers' shelves were loaded with a record $3,451,800,000 worth of raw materials and finished goods at the end of August . . .

Imagine the tremendous inventory. Then it says:

Hising steadily, month by month, over the period of a year, the inventories in August reflected a $56 million increase from July and a total advance of $899 million from August last year.

Then the article concludes with this striking statement:

"Volume rose slowly during the last quarter of 1950 and the first quarter of 1951, and much more rapidly during the next four months," the bureau said. "At the end of July this year total volume appears to have been 16 per cent above the low point reached last November."

If these goods were available on the market today what a difference it might make to the level of prices. What is this committee going to do to help get these goods out on the market? Nothing at all. There will be delay and more delay until they have a chance to tighten up. In fact the work of this committee might possibly forewarn some of these people and put them in a position to capitalize further at the expense of the consumers of this country through the accumulation of huge inventories.

I also ask the Minister of Justice to tell us in what way the setting up of this committee will abolish or reduce government taxes that contribute directly to high prices. I wonder if the Minister of Justice would be prepared to bring his colleague, the Minister of Finance (Mr. Abbott), before this committee and have him give testimony as to how government taxes contribute to a level of prices such as the people of this country never before have had to pay. I can see nothing in what the committee is empowered to do by the resolution that would in any way help the taxation situation. I wonder if the Minister of Justice will be able to tell us how the setting up of this committee will help those people who have not the purchasing power today to get the things they need. How will this committee help them? I am referring, for instance, to the recipients of veterans pensions and allowances, the old age pensioners, and to the dependents of the gallant fellows who are fighting in Korea, who are suffering at the same time the disabilities attendant on them because of the terrific high cost of living. What will this committee do for them? It will do nothing except perhaps intensify the situation by delay. What, therefore, are we to do? We are confronted with a resolution to set up a committee when what we want is

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action. I suggest that the government get off their plush bottom seats and dig into this whole matter.

Topic:   COMBINES LEGISLATION
Subtopic:   MOTION TO ESTABLISH JOINT COMMITTEE TO CONSIDER INTERIM REPORT
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CCF

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

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

Mr. Knowles:

Get off what?

Topic:   COMBINES LEGISLATION
Subtopic:   MOTION TO ESTABLISH JOINT COMMITTEE TO CONSIDER INTERIM REPORT
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SC

Solon Earl Low

Social Credit

Mr. Low:

Their plush bottom seats and dig into this cost of living business with something really worth while that is designed to bring down the general level of prices. At the same time let us follow up the suggestion made by the hon. member for Lake Centre. I cannot refer to his amendment except to say that if I had had a chance to vote for it I certainly would have supported it. I supported Mr. Speaker's ruling because I felt technically he was right, but I should like to have seen the amendment couched in a little different terms or started a little ahead of where it did start as an amendment to the resolution. Then the hon. member for Lake Centre would have had my wholehearted support.

I think what he proposed is sound. This resolution should be calling for a joint committee to study the whole Combines Investigation Act and recommend ways and means of tightening it up, making it more effective and at the same time perhaps helping the minister become a little more effective in applying it. I think that is what we should have. I have no objection to the committee envisaged by the resolution. It may be able to do some good, and frankly I am all for making it possible for the various trade associations across the country to present their views. I have no objection to that at all. Let us get all their views. Let them come, say what they have to say, and give us the information we ought to have. Maybe they can help us; but for goodness sake let us not fool ourselves into believing that is going to help the cost of living situation or relieve the people of this country of the burden of high prices they have to carry; not for a moment.

At the same time the committee is carrying on its work let us get the Minister of Justice to bring in a wider reference and give us a chance to express our views on the whole of the Combines Investigation Act. At the same time let us get after this cost of living business and do something really worth while about it so we can justify ourselves as a parliament in this country. If we go back to our constituents after this session is over having done nothing but what is envisioned in the resolution, the people ought to rise up and kick the daylights out of somebody. I think the people they should be aiming their kicks at are the fellows in the front line who formulate policy.

Topic:   COMBINES LEGISLATION
Subtopic:   MOTION TO ESTABLISH JOINT COMMITTEE TO CONSIDER INTERIM REPORT
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CCF

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

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

Mr. Knowles:

Kick them in their plush bottom seats.

Topic:   COMBINES LEGISLATION
Subtopic:   MOTION TO ESTABLISH JOINT COMMITTEE TO CONSIDER INTERIM REPORT
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SC

Solon Earl Low

Social Credit

Mr. Low:

Yes, as my hon. friend says. I am not opposing the resolution, not for a moment. We will support the idea of it, but we are not fooling ourselves that it is going to help. We demand that the government get busy and put something before us that is really worth while.

Topic:   COMBINES LEGISLATION
Subtopic:   MOTION TO ESTABLISH JOINT COMMITTEE TO CONSIDER INTERIM REPORT
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November 2, 1951