January 21, 1957

LIB

John Horace Dickey (Parliamentary Assistant to the Minister of Defence Production)

Liberal

Mr. Dickey:

The province would have no share of the cost, but under this particular study the province could have an important share in the redevelopment and re-use of the land after the site is cleared.

The same type of study is being conducted in Saint John, New Brunswick with a more extensive study being undertaken in Toronto. Two separate studies are being performed in Winnipeg. All of these studies receive similar assistance from this government. A study is also being carried on in Vancouver. I suggest that many other cities and towns in Canada could obtain valuable assistance from studies of this kind and I suggest that they give serious thought to participating in such studies.

While a study of this nature is an essential first step, the real difficulty arises when consideration is given to implementing the recommendations of a study. Action in this

The Address-Mr. Dickey connection is provided by the act by way of a partnership between the federal and provincial governments or, alternatively, between the federal government and the municipality with provincial agreement in that kind of arrangement. Under this partnership the federal government may pay one-half of the gross cost of acquiring and clearing the area selected as a result of a study. The land can then be used by the municipality for its highest and best use. That is to say, it can be used for a low-rental project, for medium rental projects, for high rental, for public, commercial or industrial use, or the best combination of them. This is the change in the act which was brought about last year and I believe it makes these redevelopment proposals much more attractive to municipalities. It is a sensible change in that it makes land available for its highest and best use.

Central Mortgage and Housing Corporation can participate in redevelopment under any one of these plans provided for by the act through the joint financing of low-rental housing projects, limited dividend projects and the like. It is also possible that private enterprise can be welcomed to participate in one of these redevelopment plans in an appropriate way.

Redevelopment does not simply mean the demolition and rebuilding of an area. It means first of all the making of a plan, second, the demolition and clearing of the area selected; third, the taking of measures to prevent further blighting of the area and surrounding areas; and, fourth, the re-use of the land for its best use as decided by the municipality.

The advantages of these proposals are well summarized in a study made by the city of Toronto in 1956 of urban renewal. It points out that to the resident the advantages are the removal of overcrowded and unsanitary accommodation and its replacement by a wide range of dwellings in houses and apartments within or beyond the city limits and at prices or rents which are reasonable, or re-housing in the same area.

To the industrialist it provides sites to suit industries that need a central location, with adequate parking and loading facilities, efficient transportation of materials and products and good transit service for employees.

To the businessman it offers commercial districts expanded at logical locations, with ample parking facilities laid out for customers', clients', and office workers' convenience.

To the individual affected it offers areas where clearance and rebuilding or improvement projects are sponsored by the city, equitable treatment and fair prices to property owners.

The Address-Mr. MacLean

Then to the city council and all citizens it otters economy through the re-use of valuable but blighted areas, with an orderly plan of civic spending.

I have just caught your eye, Mr. Speaker, and I realize that my time is up. I want to conclude by saying that I hope the city of Halifax will take advantage of this study which I have mentioned and go forward to a sensible project for the re-use of land which may be selected by the city. I hope the town of Dartmouth and other cities and towns right across Canada will take advantage of these facilities for civic improvement.

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PC

John Angus MacLean

Progressive Conservative

Mr. J. A. MacLean (Queens):

Mr. Speaker, as I rise at this time to take part in the debate on the subamendment now before the house I should like to call your attention to a paragraph which appears in the speech from the throne and which reads:

Excellent progress Is being made in our national economic development. Expansion is evident in every part of Canada. Rapid strides are being made in opening up and utilizing our natural resources and in our industrial and urban growth. Employment has reached unprecedented levels. Once again we have been blessed with good crops. External trade was considerably greater last year than during any previous year. Canadians in almost every part of the country have been enjoying the benefits of this invigorating economic climate.

The only trouble is that anyone living in the maritimes would not recognize that as an outline of the economic situation in the part of the country in which he is living. As a matter of fact when I read it I was almost led to believe that somewhere in the government there must be an official of the type that used to exist in czarist Russia and whose job it was to go in advance when the czar was making a trip to brighten up the villages along the route so that the czar would be led to believe that everything was fine in his kingdom. In this case it is not the monarch who is being fooled: if anyone is being fooled it is the general public.

At best there appears to be a lack of understanding of the situation in which the four Atlantic provinces find themselves. At the very worst it may be that the government has concluded that the voice of the maritimes in the affairs of the nation has decreased to a low point and that politically the Atlantic provinces are no longer important and no government needs to seek their support. Reading this over I notice that the only reference in which they indicate that every prospect is not rosy is where they say: "Canadians in almost every part of the country have been enjoying the benefits of this invigorating economic climate." It is the one word "almost". Ten per cent of our population and four of our provinces have been passed over with that reference-"almost".

Fortunately, Mr. Speaker, further on in the speech from the throne this statement is found:

The preliminary report of the royal commission on economic prospects has been received and will shortly be laid before you.

As hon. members know, we now have this preliminary report and I would like to refer to it briefly. I think the report of the Gordon commission will serve a very useful purpose in focussing the attention of, I hope, all the Canadian people on the urgent need for a complete new deal for the Atlantic provinces. In this connection I would like to congratulate the hon. member for Inverness-Rich-mond (Mr. MacEachen) on the very excellent and astute observations he made with regard to this subject during the course of his speech in this debate a few days ago. My nature is to be generous and I regret, therefore, that my generosity cannot be strained to the point of congratulating the hon. member who has just taken his seat (Mr. Dickey) with regard to his references to the Gordon commission and the plight of the maritimes generally. I regret that shortness of time did not allow him to reach that point: I expect he would have done so had he not reached the limit of the period allotted to him.

When the Atlantic provinces entered confederation they entered it in the belief that they would retain most of the many benefits which they had already built up for themselves as colonies. They were led to believe that in addition the colonies, by uniting together, would receive further mutual benefits. One of the chief advantages which were to accrue from confederation was the greater ease of defence of British North America. They were also led to believe that the larger unit would prove to be a more efficient economy, providing a higher standard of living for all its members.

What did the Atlantic provinces find on entering confederation-when it was too late? They found that tariffs for the whole country seemed to be set with only rare consideration for the effect such tariffs would have,on the Atlantic provinces. As a result the Atlantic provinces found that their normal channels of trade north and south had virtually been completely cut off and that their trade and commerce had been forced into an unnatural channel east and west.

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LIB

John Whitney Pickersgill (Minister of Citizenship and Immigration)

Liberal

Mr. Pickersgill:

Is the hon. gentleman

speaking for the hon. member for Broadview (Mr. Hees)?

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PC

John Angus MacLean

Progressive Conservative

Mr. MacLean:

No, I am speaking for myself and the people I represent. The hon. member for Broadview is quite able to represent his own constituency.

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LIB

Walter Edward Harris (Minister of Finance and Receiver General; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. Harris:

I was asked about inconsistency this morning.

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PC

Gage Workman Montgomery

Progressive Conservative

Mr. Montgomery:

You don't have to go

further than your own government to find it.

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PC

John Angus MacLean

Progressive Conservative

Mr. MacLean:

The Atlantic provinces, after entering confederation, find that the cost of transportation services from and to markets in central Canada from which they were supposed to benefit has become so prohibitively high that most of the industries of the maritimes are unable to carry the load.

Incidentally, when this family got together the maritime provinces were astonished to find that one of the ambitions of the two biggest members of the family was, shortly afterwards, to make vast land grabs from the rich northern lands, acquisitions which were bought and paid for by all the members of the family, without making any reasonable compensation in respect of the maritimes' share of those lands. I was astonished to find, sometime ago, that since confederation-since the time when Upper and Lower Canada-New Brunswick and Nova Scotia joined this partnership,-Quebec and Ontario have taken unto themselves a land mass greater in extent than all the territory in eastern Europe which came into Russian hands during and after the second world war. Of course I am not suggesting for one moment that the two situations are comparable. Nevertheless, it is a fact that this great territory containing many rich natural resources has contributed greatly to the wealth of the provinces concerned since it has been taken over, while the increasing population accruing to the provinces concerned has also given them a much greater voice in the affairs of the nation.

It should be remembered that at the time of confederation the Atlantic provinces were perhaps the most prosperous of any in British North America. Their population was growing, their industries were multiplying and their influence increasing. Since that time, however, the progress they were making has not continued. If one were to construct a graph of almost any activity in the maritimes-industrial production, trade, increase of population or anything else-one would find that there had been a sharp falling off after confederation.

Mr. Speaker, I see it is one o'clock.

At one o'clock the house took recess.

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AFTER RECESS The house resumed at 2.30 p.m.


PC

John Angus MacLean

Progressive Conservative

Mr. MacLean:

Mr. Speaker, when proceedings were interrupted for lunch at one o'clock I was pointing out that the economy 82715-29

The Address-Mr. MacLean . of the maritimes before confederation had been improving constantly and that in almost all fields there was a marked falling off in these activities coincidental with confederation. In another regard the maritime provinces find themselves in a less advantageous position, and increasingly so as the years go by. I refer to the weight of their voice in the affairs of the nation. At the time of confederation the maritime provinces were represented in this chamber by 43 members out of a total of 206, or more than 20 per cent of the total. At the present time these same three provinces are represented by 26 members out of a total membership of 265 or just under 10 per cent. The political influence of the maritime provinces has, therefore, declined more than half from what it was at the time of confederation.

The Gordon commission studied carefully,

I think, conditions as ttiey found them in the maritimes and have made a fairly objective report on what they discovered. To my way of thinking the report is not intended to be a forecast of what the potentialities of the maritimes are in reality but rather an observation on the facts as they are and have been over the last number of years. They project that state of affairs into the future pointing out the conditions that the maritime provinces may find themselves faced with by 1980, and their forecast is a gloomy one indeed.

It is not, as I said, a forecast of our real potentialities but rather a matter of pointing out and turning the spotlight on the neglect which the maritime provinces have suffered at the hand of every government since confederation in varying degree. I do not suggest that the ills we find ourselves undergoing at the present time are solely the responsibility of the present government. That is not the case. But nevertheless the fact cannot be denied that here and now this government is responsible and has been responsible for more than 20 years. They will be responsible for a few more months at least. Time is running out both for the economy of the maritime provinces and for the government. I believe the people of the maritime provinces are rapidly realizing that it is not in their interests to support continuously any government of any party that persists in ignoring the problems of the maritimes which are for the most part artificial ones and in my opinion almost wholly curable.

We in the maritimes think it is only fair to expect that certain things should be done and done promptly. We feel we should demand that they be done at the earliest possible moment. One injustice from which

450 HOUSE OF

The Address-Mr. MacLean the maritime provinces are suffering at the present time arises from the fact that the benefits to which they were entitled under the Maritime Freight Rates Act have been almost entirely nullified by the horizontal increases in freight rates which have taken place over the years. It is essential that the government take action immediately to amend the Martime Freight Rates Act to restore the benefits which the act originally contained.

We also feel that consideration should be given immediately and action taken to correct some of the injustices we are suffering as the result of the Canadian tariff at the present time. In this connection the Gordon commission recommends that the tariff should be studied continuously and adjustments made as circumstances require. To quote briefly, they say as found at page 73 of their report:

In fact we would advocate a continuing reexamination of the tariff Aaving in mind continually changing industrial renditions, products and technology.

In that regard there is an anomaly in the tariff structure which is of vital interest to the maritime provinces, especially Prince Edward Island and New Brunswick. I refer to the tariff on potatoes entering the United States from Canada and the tariff on United States potatoes entering Canada. When the present tariff was set up the tariff on United States potatoes was pretty much an academic question because in those days the trade was almost entirely from north to south. But now the situation has changed and we find a condition under which maritime potatoes have to find markets in the United States over a tariff of 35 cents a hundred-weight, and that on a quota. When the quota is reached the duty is doubled on any potatoes allowed to enter that country. On the other hand, United States potatoes come into Canada duty free except during six weeks each year. That is a situation which should, I strongly believe, be rectified immediately.

I have made a few suggestions and I intend to make more. In my opinion encouragement should be given to the fishing industry in the maritime provinces. Medical research at the present time seems to indicate that marine foods have a beneficial effect on one's diet, especially in relation to certain degenerative diseases, including heart disease. If it should be proven that this is an actual fact, it would be an opportunity for great stimulation of the fisheries so that the people of the country would have the benefit of including a greater amount of the products of the sea in their diets to the advantage not only of the fishing industry but of the health of the Canadian people as well.

Again, in this country there is a continual process of cannibalization of small industries

by larger industries. We in the maritimes suffer especially from this procedure whereby large corporations buy out small competitors for the express purpose of closing them down. That is a process from which we in the maritimes have suffered for years. We have very few large corporations which are in a position to turn the tables on their competitors in the rest of Canada. I believe that a study of the situation should be made with the idea of finding means of preventing this procedure which I think runs contrary to our belief in free competition and free enterprise. For the most part these industries that have been bought up in the maritimes and closed down are, for their own size and their own area, healthy businesses which would continue to grow indefinitely if merely left to themselves to do so.

I also think that greater attention should be given to finding markets for the products of the maritimes, especially markets in other parts of the world. We are by nature a marine people. Before confederation we were an important marine area, taking an important part in the shipping business of the world. This business disappeared completely. But if markets were found in other parts of the world for more of our maritime products, this action might not only stimulate the business of the maritimes but it might create a new industry, that of the merchant marine again, for maritime enterprise.

These are modest requests. I sincerely believe that all reasonable Canadians would think that they are not extravagant, especially if they had the opportunity of going to the maritimes and seeing the situation for themselves. I should like to think that every member of this house, in the course of a parliament, would take the opportunity of travelling as widely as possible in this country so that he might see for himself the problems that face certain segments of our economy. I think that statement is applicable to all members. I should like to see a member from Newfoundland take the opportunity of coming to Ottawa via the Yukon on some occasions, and vice versa.

The Gordon commission has done great service to the maritimes in pointing out the difficulties under which we labour. It makes a great number of what I consider to be sound recommendations in many other fields to which I do not wish to refer specifically at the present time. But I believe it has done a disservice to the maritimes-the four Atlantic provinces-in that it grossly underestimates the potential of that area.

We have great possibilities in the Atlantic provinces. We have great mineral wealth which has not yet been exploited or explored.

It must be realized that the Atlantic provinces include not only the three maritime provinces but Newfoundland and Labrador as well. We have great reserves of coal. We have a good climate most of the time. There is a possibility-though it is only a possibility-that oil may be discovered in the maritimes in the near future. We have a fisheries industry that could be greatly expanded under favourable conditions. We are a "natural" as far as merchant shipping is concerned. Our agricultural potential has not been exploited to the extent of half of its possibilities. The agricultural production of the maritimes could be at least doubled merely by increasing production under favourable marketing conditions which would allow farmers to operate in a more efficient manner, giving them the funds wherewith they could further mechanize their operations and buy an optimum amount of commercial fertilizer and other such things.

We have still a considerable potential of hydroelectric power which might be developed. There again Newfoundland and Labrador should not be forgotten. There is also a possibility of generating electric power from the tides, as has already been done in France. In the maritimes the tides are even higher than they are in the part of France where this development is under way.

To maritimers it would seem reasonable that a greater percentage of the iron ore from Labrador should be processed in Sydney rather than in Pittsburgh. We feel that there is a future for heavy industry in the maritimes. We know that many European countries which are well managed and which have less in the way of resources than have we enjoy at least as high a standard of living as and, in many regards, a much higher standard of living than that which now exists in the maritime provinces.

We have an integrated population. We have a tradition of higher education. We have built up a culture which is peculiar to ourselves and of which we are extremely proud. It is a culture that we in the maritimes feel that the rest of Canada cannot obtain even for $100 million.

It seems to me that we have two choices. We can either bring our needs to the attention of the government so forcibly that they will be no longer neglected or we can go on unquestioningly and everlastingly supporting this government. If we do that, I should like to warn that we might get to the place- although I do not believe so-where the only thing we could look forward to would be a one-way ticket from the maritimes to some other part of Canada. In that connection I should like to warn that only a very few 82715-29J

The Address-Mr. Macnaughton

maritimers receiving such free transportation would find that their destination was the red chamber.

This government has been proud of the record it has set in many matters. I should like to point out that in the last year and a half it has created a new record. It has exceeded Rip Van Winkle's record by about a year and a half. It seems completely oblivious of the problems under which we in the maritimes are labouring.

I feel strongly that we have a great future if given the opportunity, and I think all maritimers and Newfoundlanders will agree with me in that sentiment. We may realize that future even in spite of present government policies if they are not rectified. We are trying our best to lift ourselves up by the bootstraps by such endeavours as APEC, the Atlantic Provinces Economic Council. But if these conditions are not rectified and if we fail, there may come a time when we must resort to the suggestion that is often hinted at by the premier of Newfoundland, namely that we might consider secession from the union.

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LIB

John Whitney Pickersgill (Minister of Citizenship and Immigration)

Liberal

Mr. Pickersgill:

Rubbish.

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PC

John Angus MacLean

Progressive Conservative

Mr. MacLean:

I do not think that time will ever come. I have enough faith in the maritimes and in the Atlantic provinces to believe that we have a great future and that we shall realize that future. But the task will be much easier if we are given reasonable assistance by this government, if our problems are recognized as problems which concern the nation as a whole and if it is recognized that our demands are reasonable ones. If that is done I see for the maritimers a great future, a future which will accommodate the natural increase in our population, a future which will give us a standard of living comparable to the rest of Canada.

In closing I remind you, Mr. Speaker, and through you the government, that we in the maritimes feel that we have built up our own way of life which economic conditions should not be allowed to destroy. We do not wish to emigrate again.

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LIB

Alan Aylesworth Macnaughton

Liberal

Mr. Alan Macnaughton (Mount Royal):

Mr. Speaker, in the tradition of this house I would like to congratulate the mover (Mr. Hanna) and the seconder (Mr. Robichaud) of the address in reply to the speech from the throne.

May I take this opportunity of extending congratulations to the hon. member for Prince Albert (Mr. Diefenbaker) both on his appointment as leader of the opposition and on his election as chief of the Conservative party. Long may he reign in those two respective capacities.

The Address-Mr. Macnaughton

I have had, Mr. Speaker, the advantage of hearing and reading several of the interesting addresses from different members of the house on the subject of foreign affairs. I thought this afternoon I might advance a few ideas on that subject.

Last September I had the opportunity of visiting Europe and a few countries therein, in particular Greece and Israel. On another occasion I should like to discuss Greece and the Cyprus problem.

I admit that a short visit does not make one an expert, but at least it does indicate interest in the Middle East.

Today I would like to make a few remarks about the commonwealth and its relations, the question of the Middle East, and to advance certain considerations which I think may properly be reconsidered when we are talking about a solution for the Middle East and its problems.

The crisis in world affairs has been a long time in the making. The breakup of the nineteenth century followed the great events of the first world war and the Russian revolution. I think it is fair to say that since these two events we can hardly say we have had the advantage of peace because from these experiences have come two grave issues. The first is the rise of nationalism in the Afro-Asian world; the second, I think, is the rejection of leadership by the white and by the western nations which have up until now played a great stabilizing role in that area.

New political systems are replacing old. Certainly among the most important, on the one hand, we have the Soviet union, China and its satellites; on the other hand, the American-Anglo-French alliance. But during all these vast changes throughout the past 50 years it seems to me the most important and the most interesting thing to note is the emergence of the commonwealth as we know it today. The commonwealth as we know it today is unique because it alone bridges the gulf between the old empires of the west and the new nationalisms of the east. It is also unique because it has brought together in a form of unity the whites and those whom we like to call non-whites. Indians, Pakistanis, Australians and Canadians find the commonwealth a remarkable instrument for maintaining intimate relations that the normal contact with nations might not provide.

It seems to me that the Canadian contribution to the growth of the commonwealth has been pre-eminent. Indeed we could argue that if the commonwealth is preserved today as a continuing political fact it is because Canadian leaders in the past 50 years have been working towards greater and greater

national independence from imperial decisions. There might have been no commonwealth in 1956 if those great ex-prime ministers, such as the Right Hon. Sir Robert Borden, leader of the Conservative party during his time, and the late prime minister Mackenzie King, leader of the Liberal party during his time, and other leaders of Canadian political parties had not realized that the success of the commonwealth depended upon obtaining the right to decide questions for ourselves. Had we adopted the extreme Conservative viewpoint of imperial relations, about which we hear so much today, there might not have been a commonwealth today.

In that connection it seems to me also that Liberal policy may be expressed in the fact that it reflects the day to day changes in the world and could be put in these words: that the members of the commonwealth desired in modern terms to maintain unity without subordination and co-ordination only by consent and in association under the crown. Again I say that the extreme Conservative doctrine of commonwealth relations would ultimately defeat itself. Such arguments might have won a debate only to have lost a system.

What bearing does all this have on recent events in the Middle East? I think it means that Canadians find themselves in the present-day world subject to pressures from many different directions, such as the cold war, commonwealth loyalties and interests, relations with the United States, the security system of NATO and, let us face it, an over-all interest in human welfare.

All these things make Canadians think of their place in the world and of their obligations to other states. It is because these influences are so complex that no single explanation can describe the important decision we took a few weeks ago. To be definite, we abstained from the resolution demanding British and French withdrawal from the Suez because we felt that we had to state a moral position with respect to Anglo-French action, while at the same time we did not and could not condemn a fellow member of the commonwealth for actions which were the result of deep and understandable provocation.

Moreover, Canadian initiative in helping to establish the United Nations emergency force provided a timely face-saving device by which the United Kingdom and France were able to change their minds at the very moment that the United Nations offered some machinery to help resolve the problem that gave rise to the action in the first place.

To say that Canada was anti-British in those critical days is either naive or perverse, because as a result of Canada's action we

now have the moral and political right to ask those states, which regard the Anglo-French action as tragic, to accept our plan for an emergency force along with its objectives.

I will accept the interpretation of the Secretary of State for External Affairs (Mr. Pearson) when he says there was a moment in November when the differences between certain members of the commonwealth and the United Kingdom were so grave as to bring the commonwealth into some kind of short-run jeopardy.

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PC

Gordon Minto Churchill

Progressive Conservative

Mr. Churchill:

Nonsense.

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LIB

Alan Aylesworth Macnaughton

Liberal

Mr. Macnaughlon:

At the same time I should say I have always considered the commonwealth sufficiently elastic to suffer shocks of this magnitude and even greater. The commonwealth could not be great if it could not sustain great troubles.

I should like to spend a moment, with your permission, on the Israeli action in the Sinai peninsula and consider possible future solutions of the Suez trouble and the trouble with Israel-Egypt and the other Arab states.

Perhaps at this time a word of history might be of use. Israel came into being in 1948. The British government withdrew as a mandatory power at that time. The existing population consisting of Jews and Arabs in Palestine, upon the withdrawal of the British mandate, had to determine what form of jurisdiction would persist. The 1947 resolution of the United Nations in effect proposed partition into two sections, a section with a Jewish majority and a section with an Arab majority. The Arabs rejected in toto this idea of partition. On May 14, 1948 the British withdrew and on May 15 the state of Israel was declared by the Jews residing in that section of Palestine.

I do not think any serious person will deny that the Jews of Palestine could not sit idly by in the face of the fact that the Arabs would not tolerate the creation of the Jewish state. Israel was declared a state in

1948 and the result has been that since that time a state of war existed during 1948 and

1949 until the armistice agreements were signed with Israel by all the Arab nations, with the exception of Iraq. From these events has devolved a long train of contention in Arab-Israeli relations since 1949.

On the human side of this situation there are tragic consequences. We have the flight of the Arab refugees, and since that question alone remains the largest single difficulty in the way of settlement between the Arab states and Israel perhaps you would allow me to spend a few moments on it. The record

The Address-Mr. Macnaughton shows that in 1948 there were 800,000 Arabs living in Palestine. At the time of the creation of the new state of Israel there remained 200,000 Arabs; 650,000 Arabs left Palestine, or the state of Israel as we know it today, and became so-called refugees in the Gaza strip, in Jordan, Syria and Lebanon. I think we should ask the question why these Arabs left. The evidence is there to show that the Israeli authorities urged them to stay and as a matter of fact there are 213,000 Arabs inside the state of Israel at the present time who "never had it so good." In other words, 25 per cent, in effect, did stay within the state. The others were induced to leave by the fear of war, by panic, by propaganda and by the promises of the Arab leaders themselves in the different Arab states that if they would leave the state of Israel for a matter of two weeks it would be only a short time until the Israeli were thrown into the sea, and that after that had taken place the Arab refugees could then return and take over their lands and properties. In fact, their leaders said, "Flee for your lives and return as victors". Unfortunately for the refugees that did not happen, and far from being defeated, the Israeli defeated the Arab states. One strip which was not captured at the time of the signing of the armistice was the Gaza strip and this marked the beginning of the creation of this problem.

Since 1948 all the inducements of Great Britain, France and the United States to resettle these Arab refugees have amounted to nothing; all the funds which have been raised by way of capital grants to assist in the resettlement, restoration and rehabilitation of these refugees have amounted to nothing. Only the United Nations relief organizations have been of material help in maintaining the existence of these poor people. In the last seven years the Arab refugees have continually insisted on returning to that section of the Middle East heretofore called Palestine, but we are apt to forget that during the past seven years Israel has taken within its borders over 800,000 Jewish refugees who left everything behind them including their assets and property and came penniless to the new state. Israel on more than one occasion has declared for compensation and the resettlement of these refugees. It would appear that the Arabs refused because so long as the refugees are unabsorbed they remain a political leverage to gain the sympathy of the world and a means of preventing peace with Israel.

I would like to deal briefly with Israel's action in the Sinai peninsula two months ago.

I think it is public knowledge that for the last seven years there have been a series of

The Address-Mr. Macnaughton raids, reprisals, killings, propaganda statements and counter-statements. Although I do not wish to sit in judgment on either side I believe there are certain facts which should be brought to the attention of the house. These facts, I admit, are advanced by the Israelis and they carry considerable weight with me.

In the first place the Arab states have been preparing for the day when they could jointly destroy Israel and throw its people into the sea. The evidence for this is to be found in the radio broadcasts and in the book recently published by Nasser himself. In the second place, during the month of September 1955 we in this country heard of the sale of large quantities of arms by the Soviet union to Egypt, obviously for use against the state of Israel. In 1956 we saw the decline of British power and influence in the state of Jordan with the expulsion of Glubb Pasha, and I may say in passing that Glubb Pasha did his best to keep a state of peace existing between the state of Jordan and the state of Israel. Nasser's subsequent success in creating a unified military command along with Egypt, Jordan, Syria and Lebanon, thereby hemming in Israel with the object of destroying Israel, has created great concern in that area. We will recall that the difficulty of the Israeli government in securing arms to counteract the weight of Soviet gifts and sales of arms to Egypt and Syria was another source of discord. And last but not least, the training by ex-Nazi and Soviet advisers in the art of massacre and annihilation pushed matters forward to such an extent that Israeli statesmen had to take a definite step.

I ask the question, therefore, what should a responsible Israeli statesman have done in the face of the open threats that had been made by every Arab leader over a period of years and that were now backed up by Soviet arms and by a new Egyptian-Jordanian-Syrian joint command?

The Egyptians have openly stated that the armistice agreement of 1948 did not end the state of war. On these grounds the Egyptians barred Israeli ships from the Suez canal and fortified the straits of Aqaba to prevent Israeli ships reaching its only port on the Red sea, namely Elath.

In that connection it might be of interest to examine the legality of Egypt's possession of the islands at the entrance to the Red sea. I think you will find they were leased by Saudi-Arabia to Egypt and the legal title of Saudi-Arabia to them is open to serious doubt.

All of these facts are public knowledge and I do not need to repeat them in order to make my point. Again I would ask the

question, what should Israel have done? She is the only state in the Middle East unable to get a treaty of friendship and alliance with any great power. She has good friends, but in the game of power politics neither the United Nations nor the great powers are ready to apply measures for the protection of Israel's security.

It seems to me that these are some of the reasons why Israel moved into Sinai during October last. I think it is axiomatic that no prospective victim, whether an individual or a state, need sit and wait until the enemy is upon him.

It is not worth winning the sympathy of the world by an act of extreme forbearance at the risk of losing your life. It seems to me that this is an act which reasonable men under similar circumstances would have committed.

All of this is now past history and we have practical problems to solve. We must help to solve them as Canadians, as members of the United Nations, as the senior partner in the commonwealth and as a friend of the United States.

Already we have made a major contribution in the leadership of a program to establish and to operate the United Nations emergency force. Our view of that force, as expressed by the Secretary of State for External Affairs (Mr. Pearson), a view that appears in the November 2 resolution of the general assembly, is that the cease fire would be accompanied by a program of settlement.

Perhaps I might digress for just a moment. It seems to me that the problem in the Middle East is this: First, we had to stop the fighting; second, we have to clear the Suez; third, we have to bring a solution to the over-all general problems. We have stopped the fighting and I hope we are in the process of clearing the Suez although I have grave doubts about it.

But the third sphere of influence still persists, the need of an over-all settlement. I do not see how you can divide these three sections; they have to be taken together. If there is no over-all settlement negotiated, and I submit this will be difficult, it must be imposed by the great powers. Without an overall settlement, anything else that we might do would not amount to very much.

Any other conception of United Nations activity would, it seems to me, be hard to accept. As a Canadian I could not tolerate the tragic humiliation of Anglo-French power and interests unless there were a lasting compensation of satisfaction for their vital interests in that area, namely some suitable machinery to protect the Suez from unilateral Egyptian control, and reasonable assurance

that British and western interests in the Persian gulf are not going to be the subject of perpetual Arab cold and hot warfare.

Equally it would be a sad day for Canadian responsibility for the emergency force if its tasks were over the moment the Israeli were thrown back to the 1949 armistice line. This could never have been the intention of wiser heads in the general assembly. It must have been foreseen at that time that the status quo which caused all these troubles could never be reasserted and that instead some new ideas must be accepted by the assembly and supported by the great powers to bring a lasting peace with justice to all peoples in that region.

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PC

Gordon Minto Churchill

Progressive Conservative

Mr. Churchill:

Does not the resolution most recently passed by the United Nations restore the status quo by urging the army of Israel to withdraw from the Gaza strip?

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LIB

Alan Aylesworth Macnaughton

Liberal

Mr. Macnaughlon:

I only know what I have read in the reports in the press as of Saturday and this morning. I have not had an opportunity to see the actual resolution and decide whether it does or does not. My position is that there can be no settlement of the Middle East situation until the great powers enforce an over-all solution. They have the power to do it and I think the time has come for them to do it. As you probably know, at the United Nations 5 per cent for it is better than no per cent at all.

It is true that long-term settlements are difficult to plan and envisage, but there are some very important and immediate problems with which it seems to me the United Nations and the great powers should deal in relation to Israel, Egypt and the Arab states. I should like to list these for analysis.

I maintain that the necessity for the recognition of Israel as a state and working part of the Middle East should now be decided. I maintain that we must give recognition to the state of Israel and remove therefrom the threats to her security. By that I mean the elimination of border raids, the stopping or calling off of the economic blockade by the Arab states, the refusal of passage to Israeli ships through the Suez and a guarantee of open access through the Red sea and the gulf of Aqaba.

Since so much contention surrounds the future of the Gaza strip I maintain that it should not be returned to Egypt. It never was a part of Egyptian sovereignty. It points at the heart of Israel and in the past has been the location of raids against that country. It forms no part of the Egyptian economy and it is not needed for the security of Egypt.

I maintain also that the refugee problem should be broached in the spirit of construc-

The Address-Mr. Macnaughton five statesmanship. The cost of resettlement of those refugees in the Gaza strip and in other Arab states could be shared by the United Nations and the great powers as well as by Israel itself. There is plenty of land in the surrounding Arab states, as a short visit to the area would indicate clearly, on which these refugees could be settled to their benefit as well as the future benefit of the countries in which they are settled.

There is another point of important economic consequence and I refer of course to the Johnston plan for the settlement of the Jordanian water dispute. It is hard for us who live in a country like Canada to realize the importance of water to other countries. Water is the lifeblood of the economy of this area. Water is going to waste in the Jordan river and the Jordan lakes because of a refusal to use it and distribute it among the countries that need it. There is no reason why a settlement of the Jordanian water dispute, which is so important to Israel and Jordan, should not be included in an over-all settlement.

This is a time of trouble not only for the Arabs but for all of us. The Middle East is caught in serious pressure moves and plays which makes it all the more important'for the United Nations and countries with experience in the Middle East to urge the Arab people to consider their long-range needs and the great burdens they bear, by refusing to use their energies to resolve their real problems, rather than to dissipate their energies in hatred of a neighbouring state.

Israel can offer a great deal to its neighbours in the way of technical skill, idealism and standards of public responsibility. The Arab nations can offer Israel a sense of kinship with the Middle East, for after all the Jewish people have been in existence for some 5,000 years and originally came from that part of the world. The Arab nations can offer Israel a market for its products and they can also contribute part of their culture from the Levant to the culture which is rapidly rising in the new Hebrew society.

In the Middle East the level of economic development is far behind the rate required for adequate living standards for the majority of the people. A regional capital and technical assistance plan would be a contribution of the first magnitude to the development of stability in the Middle East. I am sure that Israel could contribute to this plan its share by way of brains, experience and devotion which would form a counterpart to the capital to be provided Dy the western and other nations of the United Nations.

Some students of the British mandate and its future in Palestine had hoped that one day

The Address-Mr. Argue British Palestine would form another dominion in our commonwealth.

I think it is obvious that this hope is now gone, but this does not mean that the commonwealth should now abandon Israel.

Canada, as the senior partner in that commonwealth, may And itself performing a great historic function in its present role of influence between Israel and her Arab neighbours-a function that could bring deep and lasting benefit not only to Israel but to the Middle East and to all mankind.

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CCF

Hazen Robert Argue

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

Mr. H. R. Argue (Assiniboia):

First of all, Mr. Speaker, I wish to deal with some urgent problems which face a great many citizens of Canada at this time. A little later, I wish to make some references affecting the Minister of Agriculture (Mr. Gardiner) and the Prime Minister (Mr. St. Laurent). It seems to me that at this time the parliament of Canada should initiate legislation to increase old age pensions, to increase the family allowances, to provide for a system of health insurance for Canadians, to provide legislation to improve the position of veterans in this country, to provide legislation to enable the municipalities to discharge their important responsibilities, and to provide legislation which would enable the agriculture industry to share in the great wealth that is being produced in this nation.

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LIB

Daniel (Dan) McIvor

Liberal

Mr. Mclvor:

And reduce taxes.

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CCF

Hazen Robert Argue

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

Mr. Argue:

There can be no question but that Canada today is producing tremendous wealth. The gross national product, which stood at some $12 billion in 1946, had increased to nearly $30 billion by 1956, an increase of roughly two and a half times in ten years. In the light of this tremendous production of wealth it seems to me that the government should no longer hesitate to provide legislation such as would enable all Canadians to share in this production.

We already have some important social security legislation on the statute books of this nation. A Liberal government has been in power for many years and it has been the lot of the Liberal government to introduce such legislation as old age pensions, family allowances, grants to hospitals, legislation to continue the Canadian wheat board and so on, and I give the government every credit that is due to it for having presented such legislation to the House of Commons. To the extent that the Liberal party can take credit for these measures I give them credit too, but I feel that members of the C.C.F. party have also over many years played an important part pioneering in this field and in building up public opinion to demand such legislation. The

government, while presenting legislation at different times to improve the lot of certain Canadians, has, I am afraid, not been doing so primarily with the object of helping the people affected. The overriding consideration which guides the Liberal party today is to do those things that it hopes will bring votes when election day comes around; anything that may be done to help the old age pensioners or improve family allowances or assist in any of these important matters is done as a secondary consideration. I think this contention can readily be proved.

The last time old age pensions were increased in this country was in April 1949 when they were increased to the present figure of $40 a month. Since 1949, inflation and the ever-increasing cost of living have taken away a substantial part of the pension in terms of the 1949 dollar. What has happened to the old age pension because of inflation, because of policies followed by this government, has happened to the family allowance legislation. I believe the Family Allowances Act is one of the best pieces of legislation that has been placed on the statute books of this country. But every month since that legislation came into effect the government has stood idly by while inflation, the rising cost of living, has eaten away a considerable part of the purchasing power of that allowance until today the purchasing power of the allowance cheque is probably 40 per cent less than it was in 1944 when the act was first brought in. Thus the government, while bringing forward legislation from time to time to help certain people of this country, has stood aside while inflation, like a thief in the night, has robbed them of something that should be there and which should be protected. The very government that brought in family allowance legislation has demonstrated to the people of Canada since 1944 that its overriding purpose, its guiding purpose, at that time was not to help Canadian families- though it did do that-but to endeavour to win the 1945 election.

They won that election, albeit by a very narrow margin, since when the government has been content not only to do nothing about improving the family allowances but to allow them to deteriorate and wither away.

Today there is a great deal of talk about a health program. Well, talk of a health program is no novelty in the Liberal party. They have been talking about it in this country since 1919 and since that time successive Liberal governments have used the hope of a health insurance plan as a means of garnering votes. But they have so far done very little about it, and today parliament is in an unhappy position because of the

government's policy. The government has said to Premier Frost of Ontario: "We are voluntarily giving you the power of veto; we are giving you the power to prevent Canadians in other provinces getting a health insurance plan because we will not give the plan to Saskatchewan, Alberta and British Columbia until Ontario and some other provinces agree to come in." The conclusion seems unavoidable that there seems little hope at this moment of any provincial Liberal government in this country agreeing to participate in this plan. If and when the people of Canada ever have a health insurance program it will only be because public opinion has put pressure on the Liberal party both here in the federal parliament and in the various provinces to agree at long last to do something about their promises and pledges of 1919.

We hear a lot of talk about an election now. The Minister of Finance (Mr. Harris) announced this morning that the election would definitely be held this year and that his budget will be brought in, he expects, just before the dissolution. It seems to me, Mr. Speaker, that the government is mentioning dissolution from time to time and the possibility of an election at an early date for one main reason-to condition the mass of Canadians to the prospect of an early election, because this government is just as fearful of an election campaign today as it has been in past election years. They would like to have an election date early so that the rural constituencies, who are important in numbers even if they are no longer considered by the government to be important economically, will not have a chance to participate by way of attending public meetings and taking a full part in the election -an opportunity which would be open to them if the election were held at a more convenient time.

So the government is hoping now, with public opinion running against it, to sandwich in an election at an early date in order that opposition parties generally will not have the advantage oi a strenuous campaign during which they could take the issues adequately before the public in the constituencies to which I have referred.

The government is apparently doing nothing or very little to solve the problems affecting municipalities. As a matter of fact, the general policies of the government are designed to make it harder for municipal governments to provide adequate services. Municipalities find it more difficult now to finance the construction of public buildings and streets and providing sewer and water works. Almost weekly the cost of financing municipal ventures goes 82715-30

The Address-Mr. Argue up. The government's so-called tight money policy is a policy that is hurting the ordinary Canadian. It is hurting the municipalities, it is hurting the people who want to build homes, but it is not hurting the great corporations of this country that have adequate finances within their corporations to undertake most of their capital expenditures or which are in a monopoly position and are able to pass on to the consumer through higher retail prices any additional cost that may now be entailed in financing capital expenditures.

I submit that the Liberal party by its record is no longer a liberal party. It is a party of the status quo. It is a party of vested interests. It is a party which gives something to the ordinary Canadian most reluctantly. It amuses me when Liberal speakers get up and embrace the C.C.F. Winnipeg declaration of principles adopted at our national convention last year and assert that the C.C.F. has abandoned its principles and has become a liberal party. I venture to say that not a single Liberal member who has made such a statement has read the Winnipeg declaration because in it they will find the greatest castigation possible of the Liberal party and the policies it follows. I quote one short paragraph from page 1:

In spite of great economic expansion, large sections of our people do not benefit adequately from the increased wealth produced. Greater wealth and economic power continue to be concentrated in the hands of a relatively few private corporations.

Listen to this.

The gap between those at the bottom and those at the top of the economic scale has widened.

It is interesting to hear Liberal members stand up and agree that their policies have been such a dismal failure and that the gap between the people at the bottom of the ladder and those at the top is widening at this time.

There is a whole industry in this nation that is sick and almost in danger of dying because of the policies followed at times by the government and because at other times of lack of policies and adequate action. I refer, of course, to the agricultural industry. It is true there has been some improvement in recent months. It is true that recently there has been some increase in farm cash income. That increase has been brought about mainly because of increased exports of grain. But before hon. members opposite conclude too hastily that all is well with the agricultural industry, I suggest that they read the statements being made by prominent agricultural people, people associated with the farmers' union, the interprovincial farm union council and the wheat pool organization. I

458 HOUSE OF

The Address-Mr. Argue should like them to read some of the statements made recently by J. H. Wesson, president of the Saskatchewan wheat pool. In such statements they will find that agricultural leaders across the nation are more concerned with the plight of the agricultural industry at this time than they have ever been at any time since the end of the war, and well they might be.

I have here the Economic Annalist published by the marketing service of the Department of Agriculture. It takes as the base period for the cost of production index for farmers and as the base period for the prices of agricultural products the years 1935 to 1939 as equalling 100. Since that time the economists have plotted the changes in the index of prices of agricultural products and the changes in the index of the farmers' cost of production.

In 1946, with a gross national product of $12 billion, the index of farm products was 204 and the index for the cost of production was 157. In other words, in 1946 prices for agricultural products had a 30 per cent greater purchasing power in terms of the farmers' cost of production than they had in the late 1930's. In 1956 there is an entirely different picture. Prices for agricultural products have gone up little in the ten year period. They have gone up to 232.5 while the cost of production index has gone up to 254, that is now beyond the index of prices of agricultural commodities. Therefore, according to the economists in the Department of Agriculture who publish the Economic Annalist, the purchasing power of agricultural commodities today is 9 per cent lower than the purchasing power in the years 1935 to 1939.

What a condemnation that is of the Minister of Agriculture and the Liberal government, which took office in 1935, that since that time over a period of 22 years have allowed agriculture to drift into a position where the purchasing power of agricultural commodities today is worth less than it was in the dark depression days of 1935 to 1939! Our farmers did not expect this to happen. The government presented the Agricultural Prices Support Act to the House of Commons toward the end of the war and they wrote into the act these words:

The board shall endeavour ... to secure a fair relationship between the returns from agriculture and those from other occupations.

They promptly forgot their many promises to the farmers and the people of Canada generally and allowed agriculture to drift into its present very sorry state. We have a Minister of Agriculture all right, and I see by the public accounts that he is quite a traveller.

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LIB

John Whitney Pickersgill (Minister of Citizenship and Immigration)

Liberal

Mr. Pickersgill:

That is a generous remark.

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January 21, 1957