November 25, 1953

LIB

James Garfield Gardiner (Minister of Agriculture)

Liberal

Mr. Gardiner:

The final price will not be known until they have sold the product. It is too soon to give the final price now. But that is the provision in connection with potatoes. I can probably answer what my hon. friend has in mind by coming at once to the position existing in connection with cheese in Ontario. The cheese producers in Ontario have been having some difficulty in marketing their product over the years. When I came down here first 18 years ago I was convinced, as I think most hon. members were, that we ought to increase our production of cheese in Ontario and Quebec, and get back to the old levels we used to have at the beginning of the century, when we sent 150 million pounds of cheese to Great Britain.

(Mr. Gardiner.)

Well, we started out to try to get that done. We got it done for one year during the war, and from that time on the price of cheese has been going up constantly but the production of cheese has been going down, until last year we could have sold all the cheese that we produced in Canada on the Canadian market and at a higher level than we could sell it at anywhere else. This year we have been up against the same experience. The cheese we have produced here, amounting to somewhere near 60 million pounds, is not enough to supply this entire market if an effort were made to sell it here, without going to any other.

It is true that we sold 10 million pounds, or at least this association sold 10 million pounds of cheese to Great Britain. We bought 5,500,000 pounds of cheese under our Agricultural Prices Support Act last May, for which we undertook to see that the farmer got 30 cents a pound, or at least on the basis of 30 cents for the milk he put in the cheese. Now, partly as a result of the fact that this 10 million pounds of cheese has been sold out of Canada, the price of cheese is comparatively high. The cheese we have now is now selling at around 35 cents a pound. We have sold about half of it at between 32 cents and 35 cents. So the farmers who delivered their milk in 1952 in order to produce the cheese we now have will probably get a little more for their cheese than the farmers who turned their milk over to the board as of the 1st of July of that year and had cheese produced from there on at a price which netted them something less than 30 cents a pound.

That situation is created through the fact that we have gone into the province of Ontario under the Agricultural Products Cooperative Marketing Act of 1939 and made it possible for the cheese producers' association to take delivery of cheese in Ontario, pay an advance of 24 cents and go on selling, and up to date they have had about 28 cents a pound. From now on they will obtain whatever sum is received in addition to what has been obtained for the product up to now. I am quite satisfied that the final price, when it is obtained, will be one that is quite satisfactory to most of the producers in the area.

I do not think it is necessary to go into a discussion of other crops that are handled under this act; I believe the point I wish to make is well illustrated, but I do want to say that the sale of what are more or less known as specialties in agriculture, such as potatoes, fruits, tobacco, vegetables of some sorts and even fluid milk, is promoted within the province by the provincial governments

The Address-Mr. Gardiner

and by the provincial farm organizations. If governments assist or control it is the provincial rather than the federal government which acts. That is so largely because of the fact that if we were to go into the provinces and promote production of some of those commodities to the detriment of the producers and affect their prices we would, of course, be open to criticism. But we say to them, all right; you go ahead and handle them. We will assist you under our co-operative marketing act and we will assist you in some other ways in connection with the handling of those products.

When we come to meat products, dairy products and grains such as feed grains and wheat, our situation is quite different. It was those products upon which the figures I read a few moments ago were largely based. When we talk about the cash income of farmers across Canada, or when we talk about the net income of farmers across Canada, we are largely reasoning with regard to what we know about the production and marketing of livestock, dairy products and grains. Reasoning from those we are inclined to say either that agriculture is better off or that agriculture is not better off.

I have not had the privilege of being in the house during the last two days because I was attending the conference, but during the time I was here listening to the debate I was somewhat surprised at the nature of the discussion in relation to these questions. I find it very difficult to be affected by the reasoning of those who say the farmers in this country are not as well off today as they were at some other time. I do not find that as I go across the country. I want to make it perfectly plain that I find farmers in Canada who are not as well off today as they were at some other time. I find localities in which a group of farmers may not be as well off today as they were at some other time. But the farmers who produce these particular products, which after all bring most of the wealth to farmers across Canada, are not in general worse off than they have been at some other time. They are better off than they have been at some other times and I do not even except the year 1951, because in 1951 we had to deal largely with what we produced in 1950 and we had not then struck one of these big crop years. 1951, 1952, 1953 were the three biggest crop years we have ever had in western Canada.

The other day I heard the Minister of Trade and Commerce (Mr. Howe) say that he used to live out in western Canada. I know he did. When I went into the legislature in Saskatchewan in 1914 he was living

at the Y.M.C.A. in Regina and had been there for possibly twelve months. His activities from that time on have been largely associated with the building of storage for grain in western Canada. Therefore he has firsthand knowledge with regard to it. My activities from that time down to this have been associated with the legislature of Saskatchewan and with this house. I said the day before yesterday, and it was in the press of yesterday, that about three-quarters of my time during that period had been taken up considering things that would be helpful to wheat farmers in particular, because in Saskatchewan we grow and have grown over the years more than half of all the wheat that is grown in western Canada and, therefore, more than half of all the hard wheat that is grown in this country.

Yesterday, listening to the members who were at the conference, and particularly the ministers, I was struck by a remark made by a minister who does not belong to the party to which I belong but comes from a province which is right alongside my province, the province of Alberta. His statement ran something like this. A great many people are talking about the oil supplies we have in Alberta. They are talking about our coal supplies. They are talking about our timber supplies, and so on. When you take the whole production of Alberta in everything else and put it up against farm production you find that farm production is $200 million greater than that of all other production put together.

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LIB

Clarence Decatur Howe (Minister of Defence Production; Minister of Trade and Commerce)

Liberal

Mr. Howe (Port Arthur):

Hear, hear.

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LIB

James Garfield Gardiner (Minister of Agriculture)

Liberal

Mr. Gardiner:

Well, farm production is what makes things tick out in Alberta. It is true that oil helps along a little for the time being, but the people who live there and expect to live there throughout the years know that the fundamental thing is the production from farms.

In connection with Saskatchewan, I was looking out the window of the railway car the other day when I was passing Virden, Manitoba. I always look out the window as I go past that point because my old friend Dr. Motherwell, who preceded me as Minister of Agriculture, used to tell me that when he was moving out from Brandon to his homestead he got stuck right there with his oxen and had to unload his household effects, get the wagon out of the mud and back on to the road or back on to the prairie so he could go on.

Do you know what I saw on that spot the other day when I was going along on the

The Address-Mr. Gardiner train? There is about a foot of oil on the ground right where he was stuck, and there are four oil wells right around it. I venture to say that if Dr. Motherwell had been able to prove that there was oil right under where he stood he never would have reloaded his settlers' effects. He would have stayed there, and we would have lost the experience of one of the finest agriculturists we have ever had in this country. It was 1879 that he went out there and we have been going on building up that country upon the production of agricultural products.

Those of us who were accustomed to offer up prayers in connection with these things no doubt on many occasions prayed for big crops, good crops. The one thing which was likely to cause us any great trouble out there was a crop failure, and unfortunately, we are subject to crop failures and we have no way of proving to you this afternoon that we shall not have them again. I have every reason to believe from my experience out on the prairies, which extends now over more than 60 years, that we are going to have them again. Therefore no one can get me greatly excited about the fact that we have more wheat piled up out in western Canada than we ever had before. I want to say that is the best condition we ever had in western Canada, and I do not know how anyone is going to convince our farmers otherwise.

The suggestions made here since we have been discussing this question, along the line that our farmers are in a terrible plight out in Saskatchewan, do not conform to the facts in relation to it. I know that what I am saying now will be quoted to those farmers by some people on the other side who will say, "Gardiner comes down here and says you fellows are not hard up at all" and that I go out there and I tell them, "You are in a terrible plight and therefore you ought to get more money and more help from the treasury of Canada, and you ought to vote for me." All I am going to say to them is that I obtained more than 50 per cent of the votes in my constituency in spite of the fact that they put up the best man they had against me in the last election.

I think we will go on assisting in the production of more and more. We are able to reason these things out with the farmers. The farmers understand fairly well. They do not agree they are losing out during recent years. The time you have to go back and try to find some way of helping is when they have no crop at all. But this year they have piled up around them more grain than they ever had before.

I think I can hear my friends getting up after I have finished and saying, "Oh, yes, but what good is wheat?" As one lady said yesterday over at the gathering-as a matter of fact, she was the only lady there as a delegate-"Well, you cannot put boots and shoes on children with wheat alone". I quite agree with her. As a matter of fact it reminds me that I myself once said that you can have a pile of wheat as high as the pyramids of Egypt, but if you go out and sit on top of it and you have not enough clothes on, you will freeze to death; and you might as well die one way as another.

But that is all right; I was saying that when we did not have any wheat. I am not kicking very much when we could put up a pyramid of wheat and say to people in general, "Well, here it is". That protects us against two things. In the first place it protects us against the year when we do not have any crop, and I think we will have those years in the future. When we do have them, we will have grain to sell; and if we have a whole year's crop left there to be sold, it is not going to do us any harm to have it. It is going to help us.

Then I had occasion to say something yesterday which I hope will be carried on by others, particularly in the official opposition, in view of what was said by the leader of their party this afternoon. Right in the middle of our campaign last summer-I do not know why everybody seemed to miss it- the United States wheat growers took a vote on the question of whether they would take a lower price for their grain at once under the guarantees that are given by the government on the wheat that is in the bins, or whether they would reduce their acreage. They voted, by something over 80 per cent of the farmers in the area, to reduce their acreage. The reduction they undertook to make was from 78 million acres down to 62 million acres, or 16 million acres. I would point out that 16 million acres is two-thirds of our entire crop.

I said yesterday to the United States delegates at the conference, and I say it to this house, that I think we owe an expression of appreciation to our American friends for that action. When we are talking here about having piled up great amounts of wheat, in spite of the fact that we have not as many acres as we used to have in production- we have reduced our acreage-at the same time the Americans to the south come along and say that they are taking out of production an area 16 million acres in extent, which is two-thirds as much as our acreage in western Canada. I am sure everyone will

agree that that action itself is of greater assistance to us in solving the problem of any surplus wheat we may have than probably any one thing that has been done by anybody else. I therefore suggest that we owe a vote of thanks to the Americans on the other side of the line for doing that.

Why did they do it? I have been down there, and I have discussed the matter with them from time to time. From my discussions with the experts on the other side of the line I am satisfied that they realize that we up in western Canada must be able to grow wheat if we are going to live there at all. They have told me so over and over again. But they told us only yesterday of the wonderful increases in the production of soya beans down in the area to the south, in the same area where they have been growing wheat. They told us about the wonderful production of other farm commodities. So they can go on producing those commodities and making a living growing them. If in that way, sir, they are operating in order to be of some help to us, then at the same time when we are discussing questions even having to do with dairy products, as related to their markets, I think we ought to say something in appreciation of the things they do which are helpful.

They think we perhaps send too large a quantity of oats down there some place and they criticize us somewhat. If somebody brought a lot of wheat out into the middle of western Canada we would think that they were not trying to help us at all. Therefore I am not surprised when somebody down there gets up and says something about oats. But when we have people who sit down with us and say "Out of consideration for growers elsewhere we ought to cut down on our acreage", I think we should express some appreciation of what has happened in that connection.

In conclusion, Mr. Speaker, I should just like to say a word about surpluses. The only surpluses of livestock we have are those which are largely in cans. I refer to the pork that we canned during the period we were fighting the foot-and-mouth disease, and a small quantity of the beef which we imported into North America as a result of our arrangements with Britain and New Zealand, in order to fight the foot-and-mouth disease. As a government we are not considering that this has any relationship whatsoever to our policy with regard to agricultural prices support. We only used the agricultural prices support board in order to do the job. We passed special legislation in order to make it possible for them to do the job because they were accustomed to

The Address-Mr. Gardiner buying and selling products. So we put this product in cans and now we are disposing of it.

I have noticed suggestions that we are disposing of it at a considerable loss. We never expected to dispose of it in any other way. It was not canned in the first place as a means of giving assistance to the farmers under the Agricultural Prices Support Act. It was put in cans in the first place in order to make it possible for us to go on fighting the foot-and-mouth disease and at the same time to let people go on marketing their livestock. The same thing is true with regard to cattle. Recently we have been selling this pork that is in cans. We have sold quite a bit of it at American prices in the United States and in Canada; but we know there is a limit to the time we can go on holding that product. It is still a good product, but it has to be consumed somewhere before it is much older. So we are selling it over into Europe at reduced prices.

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PC

Donald Methuen Fleming

Progressive Conservative

Mr. Fleming:

May I ask the minister if

he has figures on the losses and quantities of beef and pork on hand now?

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LIB

James Garfield Gardiner (Minister of Agriculture)

Liberal

Mr. Gardiner:

I have the figures here.

They have to do with all products under the Agricultural Prices Support Act. The stocks of cattle and hog products remaining at November 25, 1953, in round figures were: 20 million pounds of canned pork and 9 million pounds of frozen carcass beef. The total cost of cattle and hog programs carried out while fighting foot-and-mouth disease on products sold to date is estimated at about $60 million, including the $32 million already recouped by vote of parliament.

These actions on the part of the government are for the purpose of getting these products, which were set up in our effort to fight foot-and-mouth disease, out of the way of the marketing of other products in this country. Now, I do want to say this. When I came into the house the night before last I heard the hon. member for Queens (Mr. MacLean) reading a paragraph out of a report issued by my department entitled "Current Review of Agricultural Conditions in Canada." From the middle of page 5 he read the following:

The continuing high level of economic activity is reflected in the income components of gross national product. Labour income for the first seven months of this year was 10 per cent higher than in the corresponding period of 1952. This resulted in a small increase in employment accompanied by sizeable increases in wage rates. Average hourly earnings, one of the best indicators of the basic wage structure have continued to advance. At July 1, 1953, average hourly earnings in manufacturing industries were 6 per cent over those at the same date in 1952, and increases in other industries ranged between that of mining

342 HOUSE OF

Address-Mr. Gardiner which was up 4 per cent and building construction where hourly earnings were close to 10 per cent higher. Although the trend in basic working hours has continued downward, more overtime and less short time, particularly in manufacturing, has resulted in slightly longer working hours this year. Along with higher basic rates, the longer work week has contributed to the steady rise in average weekly earnings to their present peak. At July 1 of this year, average weekly salaries and wages stood at $57.58 compared with $53.96 at July 1, 1952.

My friend stopped there and used that paragraph as a basis for criticizing the situation which exists in Canada. All I want to say to the house is that we have surpluses only in wheat and cattle. We have no surpluses in these products upon which the figures I have just quoted are based, except in wheat and cattle, and all other products, including dairy products, must be sold to consumers in this country. I cannot understand why a representative of any agricultural constituency should get up in the house and criticize the fact that the people in the only market he has for most of his products, and the best market he has for most of them, are doing fairly well and therefore consuming Canadian food. I think the only way the average Canadian can be a good customer or a real purchaser of Canadian products in a good market is to have good wages, to be employed all the time, to be doing the things which he is capable of doing, and to get good returns for doing so.

When I have said that I know if he gets too much it is going to increase the cost of production on the farm. But I am quite satisfied that with the prices we are getting at the moment we are not being materially hurt on the farm, and if we can keep the other fellow getting the same return and are able at all times to sell to him all we produce at present prices we ought to be able to carry on.

What I want to say to hon. members who have been criticizing a great deal is that compelling that better price is not our job. It is the job of the provinces right across Canada. They can establish prices for these different commodities in their own provinces. The province of Ontario has done so to a greater extent than any other province. The province of British Columbia over the years has done so to a very considerable extent. The maritime provinces have taken action in that regard as well. The one province in particular from which there is not much Liberal representation in the house, and the province that is kicking the most, is the province that does the least in that connection.

Therefore I should like to suggest that in this house we realize that the fact that we have had three very fine crops recently, the fact that our farmers have taken care of

these crops in greater quantity than ever before, the fact that the farmers are telling us now that they are hoping we will be able to continue under the international wheat agreement or otherwise conditions under which we will be able to sell, if not this year then next year, at reasonable prices, all demonstrate that they are expecting us to go ahead with the policies we have been following. I am sure if we do and are able to accomplish anything like the same results we have obtained in the last ten years, agriculture will continue to be at the highest level of prosperity that it ever has experienced even though we would like to see it higher.

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PC

William McLean Hamilton

Progressive Conservative

Mr. W. M. Hamilton (Notre Dame de Grace):

Mr. Speaker, no one, I imagine, rises to speak in this house for the first time save with a certain amount of fear. While I am very conscious of my own shortcomings as a new member, I am encouraged to make this effort by the friendship and fellowship which has already been made so evident toward me from all parts of this house and from a great many of the members. I certainly hope to enjoy it for many years to come.

(Translation):

We, from Quebec, enjoy the same measure of understanding and friendship between the two racial groups forming the majority in our country.

This friendship between the two races has been of great help in the past and it still continues to bring to our country the drive necessary to its progress and development.

It may happen sometimes that our opinions differ, but the fact remains that the respect to which each group is entitled exists between us.

(Text):

At the outset of my remarks I would like to take a moment to pay tribute to my opponent in the past election who represented the riding of Notre Dame de Grace or Mount Royal, as it was known earlier, from 1940 to 1953. While I have always liked and respected Mr. Whitman, since my arrival the comments about him made to me by his innumerable friends on both sides of this house brought into sharp focus the esteem in which he was and is held by all who knew him. He was popular and was liked by everyone both inside and outside parliament, and while I am very happy to be here I am sorry that my gain was his loss, because I know you will all miss him.

The constituency which I represent is the largest in point of population on the island of Montreal, and it is largely residential. While we have our quota of stores and indus-

tries, I take my greatest pride in the people who live in Notre Dame de Grace and Montreal West, the two areas which comprise the riding. Few of us are rich and fewer still are poor. Few of us are famous and very few of us are notorious. The majority of us are English-speaking, but about one-quarter of us look upon French as our native tongue and about 2,000 are at home in Italian, while you do not have to look very far to find those who have come to Canada from all over the world and who now make their home with us because they think it is a nice place to live. We have Protestant, Catholic and Jewish houses of worship in the area.

An instance of the way in which we all live together and get along together may be found in the fact that a Jewish congregation for a couple of years met and held their services in a Presbyterian church while they were awaiting the erection of their own synagogue. All in all I think we can be proud of ourselves, because we are a typical part of urban Canada and we are making our contribution in many ways to the development and progress of a country of which we are very proud.

But we do have our problems, and one is the question of low-flying aircraft. Not too far to the west of us lies Dorval airport, and every hour there are airplanes passing overhead. These planes go over at heights which seem to us to be unreasonably low, and we are fearful that before very long some mechanical failure, some human error or some act of God will bring death and destruction crashing down from the skies into our homes. All of us are worried as we read from time to time in the newspapers of such accidents in other parts of the world. Surely there must be some method by which the menace of many airplanes flying low every day over the major populated areas could be removed. Perhaps it could be done by rerouting their path to the airport, or perhaps by an amendment to the regulations which would make them fly at greater altitudes. I think this is a problem which affects many communities across Canada, and one which deserves the careful consideration of the government.

Another of our problems in this riding is caused by the fact that it is largely bisected by the main line of the Canadian Pacific Railway which enters Windsor station through Notre Dame de Grace. For this reason there is no communication between the northern and southern sections of the riding for perhaps a mile and a half. Hundreds of cars, because this is a major metropolitan area, must go many blocks out of their way in passing from

The Address-Mr. Hamilton one section to the other. What is badly needed are two underpasses at strategic points beneath this railway line, and this matter of course comes to this house through the board of transport commissioners which answers to the government. In co-operation with the civic authorities of Montreal, we have already studied this matter carefully and we have definite ideas on the subject. However, we are going to need both the authority to proceed with the project and some measure of assistance from the funds which are made available by the government for this purpose. I hope that when the matter comes up for consideration it will be dealt with speedily.

The whole question of level crossings, overpasses and underpasses, is one affecting many parts of the island of Montreal. I feel that the government has not dealt with it adequately. Each year in our Montreal area alone many people are killed because of inadequate protection at road and rail intersections. The $1 million per year which the government makes available in its estimates for correcting this situation in all of Canada is totally inadequate, even allowing for contributions by all the parties concerned. It is going to be impossible to clear up this condition if the present attitude is continued. This is a matter of national interest, and I hope the study which the board of transport commissioners is currently making will not be long delayed in presentation and will not be pigeonholed when it does arrive.

I have just one more observation concerning Notre Dame de Grace, and then perhaps I can proceed to other matters. Our postal service is totally inadequate for the needs of a community such as ours. While we are essentially a residential community, stores and businesses are scattered throughout the area. We have numerous salesmen and representatives who combine both home and office. For some reason which was defended on the grounds of economy, but which still did not seem to result in any great reduction in the Post Office Department expenses, mail delivery in our area was reduced a few years ago from twice a day to once a day. This has caused us a great deal of inconvenience. My riding is an integral part of a great city. It is a busy place with many interests, and it is dependent upon an adequate postal service. Many of these activities are being seriously handicapped and inconvenienced by a postal service which would be more appropriate for a small, sleepy country village. We feel that we are entitled to the restoration of adequate postal facilities.

All of Canada, and certainly I think all of Montreal, is awaiting with great interest some indication of a definite date on which work on the St. Lawrence seaway is going to begin.

344 HOUSE OF

The Address-Mr. Hamilton We have heard many speeches on this subject from members of the government. We have heard many rather vague statements on the subject. Indeed, during the period of the election I rather expected any day to see a photograph in the newspaper of the Minister of Transport (Mr. Chevrier) and the Minister of Public Works (Mr. Winters) turning the first sod with gold-plated shovels supplied by the Minister of Defence Production (Mr. Howe). But somehow nothing seems to have happened. I hope that in the course of this debate one of these gentlemen will give us some indication of a definite date upon which these promises will begin to be implemented.

As a councillor in the city of Montreal I have acquired some little knowledge of the problems facing municipalities in Canada. They are serious problems. While the cities in this country have so far been able to keep their heads above water, despite the government's rather callous attitude towards them, the time is rapidly approaching when the federal government must adopt a more considerate attitude if municipal finance is to continue on a sound basis. Today municipal progress and development is grinding to a halt. Capital improvements which are particularly necessary to solve the crowded traffic conditions in the centre of almost every Canadian city cannot be undertaken because they cannot be financed. Police forces are undermanned, and they cannot give adequate traffic safety protection. Water and sewage plants are loaded to capacity and beyond capacity.

In Montreal in September the Minister of National Defence (Mr. Claxton), speaking to an international gathering of municipal officials, congratulated them on being mayors with imagination. Unfortunately, while this government has done rather well through the use of its imagination-its imaginary health scheme is one excellent example of what can be done in this field, and its imaginary devotion to free enterprise is another-municipal administration is a very realistic matter. No amount of imagination can solve the problems which are facing our municipalities, because they are fundamentally problems of finance and a dollar is not imaginary.

The civic government is the government which is closest to the citizens of Canada. It is the government which they see in action every day of the year. It is the government which protects them against fire and theft, which cleans the streets and takes away the garbage, which brings in water and takes

away sewage. It performs all the very essential functions in a modern civilized municipality. It seems only reasonable that this municipal government deserves the help of the federal government in performing these essential functions.

Certainly the two basic suggestions made by this party regarding federal-municipal relationships in the field of finance should be implemented immediately by this government, because they represent no concession by the government but merely the granting to municipalities everywhere of that which is their due. I refer, of course, to allowing cities to tax federal real estate on the same basis as 'other property, and releasing municipalities from the obligation of paying federal sales taxes on their purchases-a tax, by the way, which is paid by no other level of government and which certainly should not be paid by our cities. I was glad to hear in the speech from the throne some indication that action was contemplated in this field. We do not know what the measure will be, but I do hope that when it is introduced it will be in keeping with the size of the problem which exists.

Since my arrival in Ottawa I have come to realize under what a tremendous handicap members on this side of the house labour, due to the absence of any adequate trained technical assistance for purposes of research, and other functions of a similar nature. Members of the government have at their disposal literally squads of highly trained personnel, economists, scientists, research people and others, to work with them; and so they should, for the responsibilities of the government are heavy and their duties great. But surely this side of the house, too, with its equally great responsibilities to examine actions of the government, to conduct our own research into problems which face us and to develop our own thinking on the issues of the day-surely we are entitled to a reasonable measure of assistance and a staff section to do work which we have not time to do.

Perhaps a first step in this direction might be made through the establishment of a research service like that which is available to congressmen in the United States. Called the legislative reference service, it is a division of the library of congress and is freely available to all comers from their legislative chambers on a non-partisan basis. Through it a congressman may get a quick digest of a complicated bill or law, together with all the arguments adduced either for or against it. He can get a research report on anything

from atoms to zwieback, or the entire substance for a speech on any knotty subject to which he may refer, and get the information he might need-and it will be noted that I spell knotty "k-n-o-t-t-y". I was not worried at all about hon. members in this house, but this material does get into print.

The introduction of such a service for hon. members on this side of the house would, I think, be welcomed by all parties. It would supply us with basic information which we badly need but do not always have time to obtain. And to the extent that it made this information available to us I think it would assist us in arriving at sound basic decisions.

I have been impressed in this connection by the number of people, just ordinary citizens, with whom I have discussed this matter and who simply did not believe that some sort of assistance of this kind was not available to us. I can understand that, because it is hard for anyone to comprehend that a government with about 175,000 civilian employees, and a full complement of experts to do much of the thinking for each of its ministers, is not interested enough in careful scrutiny and debate of those measures to provide some degree of assistance in the field of technical research for opposition parties.

Now for a few moments I should like to deal with the steady movement of the present government toward socialism, a trend which was demonstrated so clearly in recent weeks when they refused to offer a private corporation the opportunity to enter into even partial competition with the government's personal air line.

But before I do that I should like to express as my personal view that one of the great strengths of this Conservative party lies in its continued adherence to the basic principles of free competition and free enterprise. Young men like myself, and young women, who have confidence in the future of this great country, and also a certain confidence in ourselves and in our ability to build for the future, do not want the golden opportunities of this future denied to us by a paternalistic government, such as the present one, which wants to do our thinking and our planning for us. We want to retain our independence, and we feel we can best do so as members of a party which stands for economic freedom of the individual and is opposed to the domination of the individual by the state.

To demonstrate how far the present government has crept, in secret and in stealth, toward socialism, I would like to

The Address-Mr. Hamilton show how closely their attitude toward their responsibilities, as expressed by the Prime Minister (Mr. St. Laurent) himself, parallels that which is openly set forth by the avowed socialists of this country.

The case for the socialists comes from a book entitled "Social Planning for Canada," which the late Mr. Woodsworth, then leader of the C.C.F. party, in a preface terms "undoubtedly in line with the Regina manifesto". Speaking of national planning, which is of course the base of the socialist approach to government, the authors of "Social Planning for Canada" said at page 222:

The basic logic of central planning is the need for some authority with the responsibility and the competence to see the economic problems of the entire nation as an integral whole.

And again at page 228:

Democratic decision on such highly technical points as whether tariffs should be low or high, or what the percentage of bank reserves should be, is naturally absurd.

And then at page 251, referring to existing control of some aspects of railroad transportation, we find this:

What is required is the consolidation of these controls, and then a deliberate use of them to forward a conscious and consistent social policy.

That, then, is the essential idea of socialists as expressed in this book. Turning to the stand of the present government, we have an address delivered by the Prime Minister at a meeting of the air industries and transport association. Doubtless realizing the weakness of his entire position, he starts out by defending it by a comparison between the jet aeroplanes of today and the wood-burning locomotives of 40 to 75 years ago when he says that the federal government-

-wants to prevent a recurrence of abuses that occurred in Canada's early days when lines were built where there was not enough traffic to support them.

Surely, if he had any comparison to make, he could have found something of the present day, instead of using the dead hand of history to try to arrest our progress in 1953. Then the Prime Minister, in his address, proceeded to lay down very clearly the premise that the present government has decided it will supplant the normal economic processes of a free society. He said:

We will endeavour to determine whether there is enough business in sight for two lines to serve the public at reasonable rates and with reasonable profit.

The decision of the cabinet, he said, would be based on-

1. What is best for the public, not just for a short period, but indefinitely;

2. What will be best for the air industry itself.

346 HOUSE OF

The Address-Mr. Hamilton

So here we have the whole damning indictment of a government which has divorced itself from its past great traditions, traditions to which it still pays lip service on every occasion and behind which it hides from time to time when public opinion is outraged, a government which has today embraced and outwardly avows in the words of its first minister some of the basic principles of socialism.

To put my argument in the briefest possible terms, let me say that the base of socialism is state planning; and the present government claims it can decide what is best for the public, not just for a short period but indefinitely, and what will be best for industry itself.

In a free economy, and under free enterprise, such decisions are made by business, by industry, and by the market-place; in a socialist economy they are made by the government. Since these decisions are now being made by the government, it is obviously a socialist government, no matter how much it may protest otherwise.

I encountered recently an interesting example of the way in which this government conducts its business, and it is another telling indictment of its tendency to build up groups of people on the public payroll without any clear idea of what they are doing, or whether they are continuing to do it.

The case I have in mind is that of the fisheries prices support board, an idea which is probably extremely sound in principle. In the twelve months ending March 31, 1953, this board were almost inactive, however; they paid out only $36,500 in a total of 1,307 cheques. Any business firm would handle such an undertaking as the part-time responsibility of one clerk. The present government retained twelve full-time employees to do the job, including an executive director, a marketing officer, a departmental accountant, a departmental solicitor, an economist, two technical officers, four clerks and a typist, plus another economist on a part-time basis. All told, including some $7,200 in travelling expenses and $3,374 for sundries, the operation set back the taxpayers $65,903.17, for the administration of a board which paid out about half that amount in actual subsidies.

The explanation offered is, of course, that when this top-heavy group is not busy supporting fish prices-and that is most of the time-they are doing other work. This brings up another interesting point, however, and that is the extent to which this government is using civil service employees for jobs other than the ones for which they are ostensibly employed. The answer to this

question is hidden somewhere behind the smokescreen which hides so many of the government's actions; but certainly we have here a clear-cut case of one thing or the other. Either we have twelve people doing less than one person's work, or we have twelve people employed for one job and doing another without the knowledge or consent of this house. In either case it is a scandalous proceeding.

Another interesting report which crossed my desk recently was that of the Canadian Broadcasting Corporation, a government body which in its own opinion and that of the government knows better than Canadians themselves what radio and television programs they like to hear.

On the face of it the C.B.C. had a successful year, for despite a loss of over $2J million on their television operations they have a net over-all operating surplus of some $375,000. This looks good in print, and will doubtless crop up from time to time in government speeches across the country, but what we will not be told is how this profit was arrived at. The method was this. First, the government kicked $6| million into the kitty from public funds in the form of a statutory grant; then an additional $5,725,000 was received from licence fees, making a total of $11,975,000 which the C.B.C. received from the taxpayers of Canada for performing a service which, under a government less socialistically inclined than the present one, private enterprise would perform for nothing.

Put another way, the Canadian Broadcasting Corporation in the past year had a net loss of over $11J million, all of which was picked up by the taxpayers of this country, either in straight grants or in licence fees. Since the total revenue from time charges of all private radio stations in Canada last year was just about $12 million, this means that the government could have bought time for 24 hours a day, seven days a week, 365 days in the year, on every private radio station in Canada for the amount of money they poured into the C.B.C.

Before leaving this question I would just like to express my hope-and a vain hope I am afraid it is-that the C.B.C. can be persuaded to release its stranglehold on television in our major cities of Montreal and Toronto, also Vancouver, Winnipeg, Ottawa and Halifax, and allow private television stations an opportunity to go into action. In Montreal, years after we might have had a private television station, the C.B.C. finally got theirs into operation. Now they are creeping toward a second, which will doubtless enable them to accumulate bigger and

better deficits; but there seems not one iota of hope for private enterprise in this field in our major cities.

I am continually intrigued by the mental gymnastics which various members of the cabinet go through in order to try to convince Canadians that some government action or policy, of doubtful value, is really beneficial to all and sundry. I am sorry I have selected the Minister of Finance because he is a nice gentleman and sent me a pleasant note this afternoon.

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LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. Abbott:

I congratulate you; you could not quote a better source.

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PC

William McLean Hamilton

Progressive Conservative

Mr. Hamilton:

When the Minister of

Finance spoke in Montreal some time ago he attempted to show that our taxes were really not very high after all. Of course he admitted they looked high in relation to past history, but then when you deducted the cost of defence, they were lower, and when you deducted the costs of social security measures they were still lower; in fact, if you deducted enough items you finally reached a point where the federal government's share of the tax dollar was less than it was in 1939. To me, this comes close to the story of the farmer who decided to teach his horse to go without eating; he just had it properly trained and down to one straw a day when the horse died.

The man who collects my taxes, and those of both the citizens and the corporations of Canada, however, seems never to have heard of the finance minister's teachings, and some of us horses who never got onto anyone's payroll are finding that we, too, are pretty well down to our last straw.

The effect of this policy of high taxation, bitter as it is at the present time, will not be fully felt until such time as our Canadian economy encounters a period somewhat less prosperous than at present; then serious difficulties for which this government will be directly responsible are certain to arise.

The reason is simply that this government has denied us, both as individuals and as private enterprise, the opportunity to lay aside adequate reserves to carry us over an adverse period. High taxation-continuing, cruelly heavy taxation-has taken away from us much of the money which normally we would have salted away for a rainy day. When that day arrives-and arrive it must- we will have nothing to cushion the shock.

Some consideration for business and industry in this regard is especially important, for unless the government is going to continue the long strides it has already made in invading the field of private enterprise, and socialize us completely, it is to private enter-Drise that Canada must still look for her

The Address-Mr. Hamilton future development and her continuing prosperity. If this is so, then we must allow the businessman a reasonable measure of freedom to prepare himself for whatever the future may bring.

One measure which I would recommend to the Minister of Finance for his consideration in preparing his budget is a provision allowing corporations to set aside a portion of their profits, before taxation, in a reserve fund to be used in subsequent years for sales promotion, advertising and the like. Time and again it has been shown that lagging sales can be revived and increased with additional emphasis on the marketing side of the business. As sales pick up, so does employment, so do purchases of materials, and soon things are going well again.

Therefore I suggest that we try to direct a portion of the company's profits, or shall we say make it possible for them to use a portion of their profits in work of this kind. Such a procedure does not of course deprive the government of any tax revenue over a period of time. While they may lose it this year they will pick it up in subsequent years when the fund is used. Not only will they pick up the revenue from such a fund, but they will have the additional advantage of increased sales and profits; and heaven only knows that the day is far distant when this government will not take a generous bite of whatever profit any of us manage to make in our business.

In the years to come, with the tremendous productive capacity we have built up in this country, and with our steadily growing industrial complex, the people who move merchandise from the end of the production line into the hands of the consumer

the salesman, the advertising man, and those associated with them-are going to play a vital part in ensuring prosperity. As someone has said, nothing happens until somebody sells something to somebody. If this is so, then surely we should do all in our power to see that our marketing effort continues at a high level and I would like to think that the suggestion I have offered is perhaps one way of ensuring that.

Indeed I think my party, with its foursquare stand in support of free enterprise and its realization that the people of this country are better able to develop their own destiny if they are unhampered by stringent government controls and restrictions, holds a solution to the problems of our day which will be supported by Canadians long after the socialist philosophies to which we are now subjected have passed into history.

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CCF

Angus MacInnis

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

Mr. Angus Maclnnis (Vancouver-Kingsway):

Mr, Speaker, unless you are getting weary of

The Address-Mr. Maclnhis hearing it, I would like to be included among those who have congratulated you upon the high position which you now hold in this house. Your election to the position of Speaker was a personal pleasure to me. I am sure you will serve the members of this house with satisfaction and yourself with credit, and add honour to the country.

I wish to thank the hon. member for Vancouver East (Mr. Winch) for the very kind references he made to me when he spoke last evening. I am sure that if he continues to be a member of this house as long as I have he will find as I have found that no matter what differences-political, philosophical or economic-he may have with the members of this house, they are kindly and sympathetic. That has been proven to me over the past few years, and I am quite sure every member will find the same thing if he is here long enough.

Mr. Speaker, we are meeting at a time which is very reminiscent of the days when I first attended this house, the 1930's. We were then embarrassed with surpluses, and it appears that today we are again beginning to be embarrassed with surpluses. Indeed, I believe that we are at the beginning of one of the periodic dilemmas of the capitalist system. We were free of them for quite a few years because of artificial conditions, but if the world is going to have peace we can expect to have those dilemmas again. I believe we are confronted with the age-old dilemma of the capitalist system-how to distribute to the people the things which the people produce. That has never yet been done. I hope we have learned sufficiently during the past few years so that we can do it this time.

This is not solely my own point of view. I have in my hands a copy of the Montreal Gazette for November 23, 1953, which reports upon the food and agriculture organization meeting in Rome. The report says that they are meeting at a time of falling prices and mounting stocks of unsold food, particularly in North America.

Now, would not one believe that in a rational society we would be glad to have great stocks of food and falling prices so we could buy that food? Unfortunately that is not the case. When prices fall, when goods become abundant, then our troubles begin- oh, not the troubles of all of us, but the troubles mostly of those who produce the goods. The organization is meeting in Rome to try, as they say, to bridge the gap between the few who have abundance and the many who are hungry. I wish them success, because their success will be our success.

Since I came down here I have heard proposals that we should give some of our surpluses away to people who are less fortunate than we are. I fully agree with that and, as a matter of fact, I have a resolution on the order paper to that end. I hope we will find ways and means to help people who need our help. We will then not only help those people with food and other things, but we will help to build conditions in other parts of the world that will promote the peace which we all seek. However desirable that may be, it will take a little time.

I had been thinking this over and before I left home I came in contact with many people in my constituency and in other constituencies around Vancouver. I feel quite sure there are large numbers of people in the great city of Vancouver who could do with some of the goods we have in surplus today. I say, why not make some of our foods available to those among us who need them? There are many living on old age security and old age assistance pensions who find it difficult to get along on their incomes. They could use to great advantage a little more bread, a little more butter, a little more meat and a little more of many things which we are wondering how to dispose of. I say that $40 a month is not a living income for anyone in these days of high prices. The time has come, indeed I think it long overdue, when the amount of the pension should be raised. Could there be a better time than this, when our storehouses are bursting at the seams with the good things of life, to raise the pensions of those on old age security and old age assistance so that, in their declining years, they could have a little more of the things the rest of us enjoy?

Another thing that came to my attention is this. During the last four or five months I have noticed that the price index has been going up; that is, the cost of living has been rising. The explanation that those who prepare the cost of living index give us for the rise in the index is that food prices have been going up. But as I hear it from the farmers, their trouble is that food prices are going down. How can it be that the cost of living to the consumer is going up because of increasing food prices when prices to the farmers, to the producers, are going down? If that is the case-and if it is not the case someone is giving out wrong information-I think the time has arrived when this government should institute an investigation by a royal commission or otherwise to try to find out why it is that when food prices go

up, the producer gets a smaller share of the consumer's dollar. That is a matter to which we should give our attention.

Then there are other people among us who are not getting sufficient to live on. There are those on war veterans allowance. Session after session members from this side of the house have pleaded with the government for a better deal for those unfortunate people. Session after session our pleas have been ignored. However, I am going to suggest again that the government take an early opportunity to act on the recommendations made by the Canadian Legion. I do not believe those recommendations are unreasonable. As a matter of fact I believe they are very reasonable.

The recommendation with regard to the basic rate is that for a single person it be raised to $60 a month. These men on war veterans allowance had to serve in a theatre of war; in other words they had to put their lives in danger. When you take that fact into consideration, I do not think $60 a month at today's prices is too much to ask for these men. Then for the married veteran the Legion suggests $120 a month. They also propose that the ceiling on total permissible income should be raised to $1,200 for a single person and $2,000 for a married veteran.

Speaking for myself, I have never been able to understand why the government or anyone else should be opposed to allowing persons on war veterans allowance to add, by earned income, to the income which the allowance gives them. I have said in this house before, and I say it again, that I believe it would be good for the veteran in the first place, because it is good for a person to feel that he is a useful member of society and that he is helping to keep himself. If he can help to keep others also, so much the better. If it is good for the veteran, it is also good for the country.

Shortly before I left home a woman called me on the telephone. She is on the widows' pension or allowance and she has also, I believe, a little additional income. She is a woman somewhere over 60. An offer was made to her that if she would help to look after an old lady, she could earn $10 a month. She went to see the Department of Veterans Affairs, so she told me, and they told her that if she took that position-do you call a job of that kind a position or is it just a job-a deduction would be made from her pension or allowance or whatever you call it.

I think that is a terrible situation. It would be good for this woman to take this work. She has nothing particularly to do. Because

The Address-Mr. Maclnnis she has nothing to do she must feel frustrated-as would every one of us-and, as we say, get fed up with life. Here she would get something to do, she would get a little bit more income and everyone would be better off. But no; we do not believe in that sort of thing. We believe that these people should get along on the meagre income the allowance provides.

Many people have come to me to ask my advice. Many of them have taken jobs without getting permission, then have found themselves caught and over a long period of time have had to pay back money that was earned and spent. Mr. Speaker, I think it is time that we stopped that sort of thing. I agree with the hon. member for Kootenay West (Mr. Herridge) who said the other evening that if the allowance cannot be increased now, legislation to raise the permissible income should be introduced at once. I hope the government will see its way clear to have that done.

Then there is another group which could be helped. I refer to the blind pensioners. I imagine that most members, or at least all the members from British Columbia, received a brief that was approved by the Canadian Council of the Blind and the Canadian National Institute for the Blind urging that, for the age group 21-69, the basic federal allowance of $40 a month be assumed by the federal government and that it be given without a means test. There is much that one could say in support of that proposal, but as others have said it already I will not repeat what has been said but will content myself with saying that I am supporting it.

I now wish to say a few words with regard to the amendment and the subamendment. The amendment reads as follows:

We respectfully represent to Your Excellency that the welfare of Canada is dependent upon free competition; and that the prosperity and security of all Canadians will be advanced by government policies which will restore markets for primary products and generally promote a high volume of international trade.

That was moved by the Leader of the Opposition (Mr. Drew) on Monday, the 16th of November. We have moved to amend that by deleting the first phrase, that is, "We respectfully represent to Your Excellency that the welfare of Canada is dependent upon free competition". Then we have added:

We further represent that this house regrets that Your Excellency's advisers have failed to recommend legislation establishing a nation-wide health insurance program, with provision for provincial participation.

The leader of this group and the hon. member for Winnipeg North Centre (Mr. 350 HOUSE OF

The Address-Mr. Maclnnis Knowles) dealt with that matter fairly fully, and I am only going to say that as far as I could find in the province of British Columbia during the federal election campaign all parties were in favour of national health insurance. At least the candidates of all parties in that province were in favour of national health insurance.

I note that today the medical profession is working frantically to get some sort of prepaid health insurance going so that they will not have to accept a state health insurance plan. They agree it is becoming absolutely impossible for the ordinary person to pay the high cost of medical and hospital services today. Anyone who has had experience with medical and hospital services during the last few years will know how much those costs have gone up. I have been talking to doctors and they tell me they are quite convinced that it is only a matter of time until national health insurance will be forced on us by the needs of the people of the country.

I am not going to deal with the amendment to any extent. I note that, according to one of the Ottawa papers, the Leader of the Opposition has called his party back to free competition. All I wish to say in that regard at the moment is that he has to take his party back a very long way before he will get free competition. If there is anything that is missing in business today it is free competition, and I think I can prove that to the hilt before I finish my speech, which will be tomorrow.

I asked the director of the combines investigation branch if he would give me a list of the reports made by that branch since 1945. He supplied me with a foolscap sheet of items, and the last report was tabled in the house this afternoon. The list begins with a report on Canada and international cartels made in 1945. It is a general report and not connected with any specific offences in Canada, but I would like to read to the house some of the conclusions of the committee that drew up the report. On that committee there were several Canadians of distinction. One of them is now chief justice of the province of Ontario. Another is principal of Queen's University, and some of

them are still in the service of the government. I will just read one paragraph from the section on page 66 dealing with conclusions and recommendations. I am sure the government has not acted on the recommendations made in this report. The report reads:

Chapters I to III describe some of the cartel arrangements which affect Canadian imports, exports and internal trade in a number of commodities. Those examples illustrate the power of cartels . . .

To do what? Now listen:

... to eliminate competition and to control production and distribution in wide areas of trade. The allocation of markets through restrictive arrangements made by private interested parties impinges on government authority over foreign trade and may nullify national trade policies developed to serve wider public interests.

While the amendment of the Leader of the Opposition is calling his party back to free competition they are urging the government to find markets, and wherever governments try to find markets they are met by the controls and the arrangements and the agreements of international cartels which are above governments, which ring a bell and governments come around and ask them what they want. The report continues:

Government policies to encourage either imports or exports may prove ineffective if private barriers to such trade are erected by cartels. The reservation of the domestic market to particular producers may be as effective as a prohibitory tariff in barring imports. The allocation of import or export quotas by cartel agreement subjects foreign trade to quantitative limitation although such control may run counter to public policy. Ways must be found to prevent private business organized as cartels from supplanting government in the establishment of such commercial policies.

I would like to know what the government has done to carry out that recommendation, and I would like to know what the opposition has to offer the government in order that they may carry this out so that then we may have some free competition in business.

On motion of Mr. Maclnnis the debate was adjourned.

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At six o'clock the house adjourned, without question put, pursuant to standing order.


APPENDIX


1. Note from the State Department to the Canadian Embassy, Washington, dated October 29, 1953; 2. Note from the Canadian Embassy, Washington, to the State Department dated November 4, 1953; 3. Note from the State Department to the Canadian Embassy, Washington, dated November 19, 1953; 4. Note from the Canadian Embassy, Washington, to the State Department dated November 25, 1953.


DEPARTMENT OF EXTERNAL AFFAIRS OTTAWA


Text of note from State Department to Canadian Embassy in Washington, dated October 29, 1953: "The Secretary of State presents his compliments to his excellency the ambassador of Canada and has the honour to advise that the Department of State has been informed by Mr. Robert Morris, counsel for the Senate internal security subcommittee, of his desire to interview Mr. Igor Gouzenko in Canada. Mr. Morris has further inquired of the Department of State how such an interview could be arranged. He has been informed that his request would be submitted to the government of Canada through its embassy in Washington. "Mr. Morris desires the department to mention that he has noted the publicly expressed desire of Mr. Gouzenko to talk to the Senate internal security subcommittee, and that the chairman of this committee, Senator William E. Jenner, considers this offer to be valuable. "It would be appreciated if the Department of State might be informed concerning the reply the Canadian government desires to be made to Mr. Morris on this matter." Text of note from Canadian Embassy to State Department, dated November 4 1953: "The ambassador of Canada presents his compliments to the Secretary of State and, in reply to his note of October 29 transmitting a request from Mr. Robert Morris, counsel for the Senate internal security subcommittee to interview Mr. Igor Gouzenko in Canada, has the honour to state as follows: "1. Apparently Mr. Morris' wish to interview Mr. Gouzenko arises from the fact as stated in your note of October 29 that he has 'noted the publicly expressed desire of Mr. Gouzenko to talk to the Senate internal security subcommittee'. This presumably refers to a statement attributed to Mr. Gouzenko in an article in the Chicago Tribune that he had some further information. "2. Before this request had been received from Mr. Morris, Mr. Gouzenko had already been questioned concerning his alleged statement since, if there had been any additional information, it should have been given to the Canadian authorities. Mr. Gouzenko, however, denies that he has any further information beyond what was reported in the royal commission's report. "3. Mr. Gouzenko states that he has been misquoted by the Chicago Tribune and denies both the alleged remarks concerning additional information and the alleged criticism of the handling of the case or the use of the information derived from it. "4. Under these circumstances, it is presumed that the reasons for Mr. Morris' request to interview Mr. Gouzenko have disappeared. "5. All information connected with this case which could be of value to the United States government was promptly transmitted without delay as soon as it was available." Text of note from State Department to Canadian Embassy in Washington, dated November 19, 1953: "The Secretary of State presents his compliments to his excellency the ambassador of Canada and has the honour to refer to the ambassador's note No. 807 of November 5 with regard to the request of Mr. Robert Morris, chief counsel for the internal security subcommittee of the Senate committee on the judiciary, to interview Mr. Igor Gouzenko in Canada.



External Affairs "The information in the ambassador's note was conveyed to the chief counsel for the internal security subcommittee, but its chairman, Senator William E. Jenner, has now written to the Secretary of State that 'there are certain facts on espionage in the United States (originating with Gouzenko) now in the record of the internal security subcommittee which do not appear in the report of the Canadian royal commission'. Senator Jenner attached to his letter to the secretary a subcommittee press release of November 7, 1953, containing the text of the previous exchange of notes between the Secretary of State and the Canadian ambassador on this subject, with comment by Mr. Morris, including the following: "Certainly the excerpt in the secret security memorandum of 1945, which has become known as the 'Nixon memorandum' concerning the fact that the secretary to the Secretary of State Stettinius was a Soviet agent, was not in the report of the royal commission. 'There are also other statements in that same memorandum which likewise were not published in the royal commission's report'. "In view of the foregoing, Senator Jenner has asked the Secretary of State to renew to the Canadian government the subcommittee's request that Mr. Gouzenko be made available for questioning by the subcommittee". Text of note from Canadian Embassy to State Department, dated November 25, 1953: "The ambassador of Canada presents his compliments to the Secretary of State and has the honour to refer to his note of November 19, 1953, concerning the request of Senator William E. Jenner, chairman of the internal security subcommittee of the United States Senate committee on the judiciary, that the Canadian government make Mr. Igor Gouzenko available for questioning by the subcommittee. "Careful consideration has been given to this request, taking into account the special responsibility which the Canadian government has assumed for Mr. Gouzenko's protection and the arrangements which have been made to provide a new identity for him, his wife and his family. "Mr. Gouzenko has been given the rights of Canadian citizenship and he is, therefore, at liberty to give his views on any question to anyone in Canada or the United States. He naturally must consider for himself the effect of his actions on the special measures that have been taken in his own interest and at his request, to protect his security and to conceal his identity. "The Canadian government fully appreciates the importance of full and close cooperation between Canada and the United States in exchanging information important to the national security of both countries. All information, without any exception, which was provided by Mr. Gouzenko to the Canadian government, has always been made available to the competent United States authorities as it became available to the Canadian authorities. Moreover, facilities have been extended to the United States authorities to clarify any point arising out of Mr. Gouzenko's evidence or views. In this connection, the federal bureau of investigation has had access to Mr. Gouzenko as and when requested. Mr. Gouzenko has, in fact, been interviewed on the F.B.I.'s behalf on a number of occasions, the latest date being August, 1950. This has been the situation since 1945 and remains the situation now. "The material secured in this way by the F.B.I. included information which was not made public in the report of the royal commission because such information related to activities outside Canadian territory which was not relevant to that report. "In addition to the facilities used and available to the F.B.I., the Secretary of State will recall that in May, 1949, the United States government requested the Canadian government to arrange for representatives of the immigration subcommittee of the United States Senate committee on the judiciary to interview Mr. Gouzenko confidentially in relation to the subcommittee's examination of specific questions relating to immigration procedures. The Canadian government made the necessary arrangements and the interview with Mr. Gouzenko took place under Canadian auspices in the presence of a member of the United States embassy and two representatives of the subcommittee. Mr. Gouzenko's evidence included general statements on the operation of soviet espionage networks, as well as such information as he had concerning operations in the United States. This interview revealed no information which had not already been made available by the Canadian authorities to the competent United States authorities. "The note of November 19 from the Secretary of State refers to a 'secret security memorandum of 1945'. The memorandum referred to was apparently prepared by and is in the possession of the United States authorities. The Canadian government is unaware what information is contained in this memorandum. In so far, however, as the excerpt from it in the Secretary of State's note which refers to a United States official is concerned, all such information from Mr. Gouzenko's testimony was conveyed to the F.B.I. through their representative in Ottawa. "As stated in the note addressed by the Canadian embassy in Washington to the State Department on November 4, 1953, Mr. Gouzenko has denied to the Royal Canadian Mounted Police that he has any further information to communicate. "It is in the light of the foregoing considerations that the Canadian government has examined the second note of the Secretary of State on this matter. It is noticed that, whereas the first note forwarded a request of the Senate internal security subcommittee to interview Mr. Gouzenko in Canada, the External Affairs present request of the chairman is that he be made available for questioning by the subcommittee. "The Canadian government believes that there has already been ample opportunity for Mr. Gouzenko to give information and make known his views to the United States authorities through established channels. Nevertheless, in view of the second note from the State Department, the Canadian government is willing, if Mr. Gouzenko agrees, to make arrangements for a confidential meeting, under Canadian auspices, at which any person designated by the United States government could be present, it being understood, as it was in 1949, that the evidence or information thus secured would not be made public without the approval of the Canadian government."



Thursday, November 26, 1953


November 25, 1953