December 12, 1960


AFTER RECESS The committee resumed at 8 p.m.


PC

John Andrew W. Drysdale

Progressive Conservative

Mr. Drysdale:

I wanted to take advantage of this opportunity tonight to make a few comments on the productivity resolution now before us. I admit that when I first thought about discussing the matter at this particular stage of the proceedings I felt a certain amount of frustration and dissatisfaction because of the tendency to draw resolutions in relatively wide terms and because of the difficulty of a member in knowing what is behind the resolution. However, on contemplation I can see the advantages offered to a member to make some positive suggestions without the impediment of having the rigidity of a bill before him. I hope to make a few random observations on some of the matters which I feel should be dealt with by a national productivity council.

I feel that this resolution is the culmination of some of the earlier pieces of legislation which have immediately preceded it. The interest of the government in the productivity of this nation has been exhibited

Productivity Council

during this session by the legislation covering small business loans, the legislation on vocational training and the trade promotion conferences called by the Minister of Trade and Commerce. We have had some 111 trade commissioners come from 49 countries throughout the world. The interest of the government has also been exhibited in the guarantee of export credits. I feel that this resolution concerning the productivity council is the logical culmination of all these ideas.

I believe the Minister of Trade and Commerce indicated very succinctly the objectives of this particular resolution. We will have a 24-man productivity council with an executive head. The council will be in existence for a term of some three years. I think the most important thing that was pointed out in the course of the debate was that some $150,000 will be put up on a yearly basis by the government.

At first blush this $150,000 seems relatively small. I am inclined to agree that it looks rather small, but on the other hand I think it underlines very clearly what is the objective of the government. The government has stated, we are prepared to start this national productivity council and if labour, management and industry generally think this council is worth while they are going to be prepared to put up their money. The Minister of Trade and Commerce has indicated in introducing the resolution that the government is prepared to match the money put up by business. I would hazard a guess that the amount is not unlimited, but I also would imagine it will be relatively extensive.

One of the things I should like to see in the productivity council is a close liaison with the dominion bureau of statistics. I feel that the main function of this council, with its relatively small initial staff-it will have to be small with a budget of $150,000-will be the preparation of statistical information. I hope that in preparing this information the council will work very closely, and I am sure it will, with the dominion bureau of statistics. I feel that, with an organization of this nature, the way the organization starts off is of prime importance.

As hon. members know, I come from British Columbia, one of the outermost provinces of this great nation, and we are some 3,000 miles away from Ottawa. It is my feeling that the only way to bring the reality of the productivity council to the outermost provinces and cities is to have the members of the productivity council visit all parts of Canada. They could visit the major cities and indicate to industries, labour and management, what the productivity council could do for these people. I somehow imagine that the initial start of the

productivity council, in so far as its local organizations are concerned, will be a meld of some local chambers of commerce and local trade unions. I feel that will be basic to the success of this organization because one of the things that is facing Canada is the tremendous technological change that is occurring all the time. It is only through the planning of labour and management, government planning on a long term basis so that there will be a minimum of effect on the workers in the various industries, that technological changes will be accomplished smoothly and to the maximum possible advantage to the country generally.

In that connection I think the productivity council could well concentrate on what I consider is one of the symptoms of the difficulties between management and labour. I refer to the strike. According to the dominion bureau of statistics, in 1958 there were some 2,872,300 man work days lost because of strikes. In 1959, some 2,386,000 man work days were lost because of strikes. These figures refer only to strikes in which more than 100 people were involved. Personally, I am not interested in whether labour is right or whether management is right. I think these strikes and this lost time are symptomatic of a break-down in labour-management relations. I feel that the productivity council could be of immeasurable assistance in providing the statistical information on productivity and by narrowing down the areas of difference between management and labour. I feel this would have the effect of cutting down the losses through strikes.

Canada has one of the highest standards of living in the world, but the rest of the countries do not care. Japan does not care; Germany does not care; Russia does not care. The only people who are going to be interested in the Canadian standard of living are Canadians. I think it is important that Canadians work through the productivity council to maximize the productivity of this nation and maintain the singularly high standard of living that we have.

There have been references to the British productivity council and there has been an allusion to the United States. In 1957 their joint congressional economic committee in the 85th congress made a complete survey of productivity and prices. Their objective was to integrate as much as possible of the data on productivity. I feel that our productivity council would do well to take this example as their initial objective. I think that within their definite limitations such an objective is a most important and immediately feasible thing.

What is the scope of the productivity council going to be? To what extent can this council examine into research? We shall shortly be setting up a committee on research that was started in the last session, namely the one that is examining into the national research council. I think it is important that the productivity council work in close cooperation with this particular body. We must consider whether the productivity council will be a clearing house for ideas in Canada. I hope that it will be such a clearing house. I hope that industry will be able to support it financially to the extent that it will become a Canadian clearing house.

How far is research going to go? We think of technical research such as research into medicine and into engineering. Will the productivity handle, for example, the problems of the aviation industry? From time to time the hon. member for Laurier has mentioned the bilateral agreements and the fact that he has felt that Canada has very often come out second best. Perhaps in certain instances he is right. There are small nations such as Holland and Belgium with first ranking aviation companies such as K.L.M. and Sabena and they have done the background research necessary to get the bilateral agreements that brought the greatest benefit to their particular countries. I feel that is one field that should be investigated. That is one field perhaps in which the productivity council might offer encouragement and work with the aviation industry.

I mention the aviation industry because I feel that to a large extent it is perhaps underrated or is taken for granted in Canada. I make that statement because in Montreal we have the International Civil Aviation Organization. Montreal is a world centre for aviation. In the commercial transport field we have the International Air Transport Association which is also based in Montreal. We also have McGill University which has an institute of air and space law drawing people from every corner of the world for the study of aviation. In my opinion that is a field in which the productivity council can produce the necessary initiative in order to provide for the exchange of ideas and to put Canada into a better competitive position having regard to world aviation.

I have tried at this time to indicate in general the direction which I feel the productivity council should take. In my opinion the step taken by the Prime Minister, in initiating this idea in October, and by the Minister of Trade and Commerce in the introduction of this resolution is yet another indication of our aggressive attitude to get out and become competitive. I think the Minister of Trade and Commerce underlined the

Productivity Council

situation quite clearly when he pointed out that the other nations do not owe Canada a living. Our only hope of maintaining our present standard of living and increasing our productivity is through the establishment of this council with the active participation of labour, management, farmers and the public in general and with the awareness that we are basically all Canadians and must get out and fight for our share of the market.

When the bill is brought into the house I hope we shall find some of these ideas embodied in that particular piece of legislation. If not, I hope that close attention will be given to those ideas so that we may establish a national productivity council for Canadians.

(Translation):

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PC

Louis-Joseph Pigeon

Progressive Conservative

Mr. Pigeon:

Mr. Chairman, this council is of vital importance to give a boost to our Canadian economy, which has been severely shaken by the shortsighted policy of our predecessors and by the attitude of Mr. Coyne, the governor of the Bank of Canada. Mr. Coyne, whose resignation I demanded before, has lost the people's confidence and was denounced by his fellow economists. To my mind, it is high time that, in the interest of the Canadian people, and of our national economy, he resign his position without delay, before a march on the Bank of Canada is organized to oblige him to do so.

Mr. Chairman, I blame the opposition members for being prophets of gloom, sowing despondency and defeatism.

Topic:   PRODUCTIVITY COUNCIL
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?

Some hon. Members:

Hear, hear.

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PC

Louis-Joseph Pigeon

Progressive Conservative

Mr. Pigeon:

Those gentlemen in the opposition may laugh and applaud now, but they will not do so for long.

We are now going through a period of transition. I am convinced that many important branches of our economy will reach new records.

The opposition is causing our Canadian economy great prejudice by preaching despondency and gloom. I strongly protest the statements of Mr. Walter Gordon, who is an economist and a politician, or rather who is playing politics, and has confidence neither in the future of Canada, nor in this government's legislation to stimulate our national economy.

Mr. Walter Gordon, this gloomy economist, under the former administration headed a royal commission of inquiry on the economic prospects of Canada. These are more or less the conclusions of his report:

Canadians of the maritimes, leave your jobs and your farms, evacuate your ancestral soil, and emigrate to other provinces.

Productivity Council

On the other hand, when he addressed the A.P.I. convention in the Chateau Fron-tenac, Professor Maurice Lamontagne, the prompter of the opposition, stated, as reported in La Presse of November 19, 1960:

Mr. Lamontagne however added that there was some ground for optimism, because this country still has some marked advantages over other countries. It has abundant natural resources, its techniques are improving constantly and it has no shortage of qualified labour.

During the conference on national problems, which took place at Queen's University, Mr. Lamontagne said, as reported in Le Devoir of September 9, 1960:

Today, there is no fear of any protracted depression.

Mr. J. R. Petrie, a responsible economist, said, when addressing the annual convention

of the federated council of sales finance companies-

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PC

Jacques Flynn (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Progressive Conservative

The Chairman:

Order. May I remind the hon. member that the resolution before us reads as follows:

That it is expedient to introduce a measure to provide for the establishment and operation of a national productivity council.

Perhaps the hon. member's remarks are pertinent to that question, but I should like him to indicate the connection.

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PC

Louis-Joseph Pigeon

Progressive Conservative

Mr. Pigeon:

Mr. Chairman, we are now

discussing the establishment of a national productivity council as a means of stimulating the economy in Canada's interest.

1 am quoting the views of Professor Lamontagne and other economists on the nation's economic position.

In my view, Mr. Chairman, that is quite pertinent to the resolution which, as a matter of fact, is quite vague in itself.

Mr. J. R. Petrie, a noted economist, in a speech to the annual convention of the federated council of sales finance companies, held at the Queen Elizabeth hotel, made the following remark, as reported in La Presse for November 15, 1960:

Mr. Petrie views with confidence the development of our trade with European countries which are now going through a period of great prosperity. He expects that in 1961 new investments will be made in Canada, and that consumer buying will also show a slight increase. On the whole, the Canadian economy will show some slight progress.

The Right Hon. C. D. Howe, as guest of honour at the thirty first annual dinner held on the occasion of the international brotherhood month by the authorities of the Emmanuel Temple, on Sherbrooke street west in Montreal, made the following statement as recorded in La Presse:

We cannot expect to be sheltered from conditions prevailing in the world, so we shall go on having slack periods and periods of growth. On the whole, however, there is no room for pessimism as to Canada's future.

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LIB

Samuel Boulanger

Liberal

Mr. Boulanger:

La Presse? What kind of a paper is that?

Topic:   PRODUCTIVITY COUNCIL
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PC

Louis-Joseph Pigeon

Progressive Conservative

Mr. Pigeon:

Ask the hon. member for Laurier (Mr. Chevrier); he knows something about it.

Mr. Chairman, those quotations from Messrs. Lamontagne and Petrie show that the Prime Minister (Mr. Diefenbaker) is right, and that Walter Gordon and the hon. member for Laurier and other members of the opposition are wrong in their pessimism and defeatism.

In fact, Walter Gordon's assertions were recently torn to pieces by Michael Barkway, head of the Ottawa office of the Toronto Star and formerly on the staff of the Financial Post.

Mr. Chairman, I must also mention the fact that the United States are now faced with a very serious unemployment problem. The number of unemployed in the United States rose by 200,000 last September-

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PC

Jacques Flynn (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Progressive Conservative

The Chairman:

Order. I think I have given the hon. member sufficient time to relate his remarks to the resolution under consideration. Whether one is an optimist or a pessimist, the question is whether one favours the creation of a national productivity council and I would like the hon. member to give his opinion thereon if he wishes to go on speaking.

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PC

Louis-Joseph Pigeon

Progressive Conservative

Mr. Pigeon:

Mr. Chairman, there is no doubt that the government would like to set up a legislative policy in the interest of Canadian economy by creating a national productivity council.

In the face of the economic drive of communist countries and those countries where labour is cheap, Canadians will have to agree to certain efforts.

We have been living in what the economists call a sellers' market, that is to say a period where all you had to do was to put goods on sale to find buyers at your own terms. We are now beginning to experience the conditions of a buyers' market, which means that the producers have to make special efforts to attract customers, due to foreign and domestic competition.

That is why such a council, which would include members from different social circles, that is employers, employees and experts from every branch of our economy-

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LIB

Samuel Boulanger

Liberal

Mr. Boulanger:

What about the unemployed?

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LIB

Joseph-Alphonse-Anaclet Habel (Chief Opposition Whip; Whip of the Liberal Party)

Liberal

Mr. Habel:

Will the unemployed also be represented?

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PC

Louis-Joseph Pigeon

Progressive Conservative

Mr. Pigeon:

Mr. Chairman, if the hon. member for Drummond-Arthabaska (Mr. Boulanger) wishes to ask a question, let him resume his seat instead of hiding behind the curtain.

Reduction of production costs also appears as a vital problem when the matter is considered from the viewpoint of exports. Canada has difficulty in penetrating foreign markets and keeping them because of our high prices and the stiff competition that has to be met. To solve the problem, it would be necessary to sell at more attractive prices, which is impossible unless production costs for raw materials and finished exports can be considerably lowered.

Production costs are undoubtedly not the only problem to solve if our economy is to be balanced again, but it does seem the main obstacle, an obstacle that will be most difficult to overcome because, to do so, we need the active co-operation of a majority of our population as well as the co-operation of the main union and employer groups.

Mr. Chairman, in my opinion the creation of a national productivity council will be ideal to promote Canadian progress and assist our economy.

May I congratulate the minister and the government for their action which will be of great assistance to Canadian economy.

(Text):

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PC

Joseph Warner Murphy

Progressive Conservative

Mr. Murphy:

Mr. Chairman, I think we all agree that this resolution in the name of the Minister of Trade and Commerce is not only constructive but is following up the resolutions and' legislation previously passed to give a boost to our economy at the present time. I think we all agree about that. I noticed when the minister spoke in the house that this particular resolution provides a good deal of free-wheeling when it comes to discussing it. I would like to mention part of the minister's speech. He said:

The objects of the council are to foster and promote the development of improved production and distribution methods; the development of improved management techniques; the maintenance of good human relations in industry; the use of training programs at all levels of industry; the use of retraining programs to meet changing manpower requirements; the extension of applied industrial research; and the dissemination of technical information.

It is quite apparent from that and from what the minister said previously that this council has an objective that provokes a challenge to the people who are going to be members. We are all glad to see that this membership is going to consist of people from commerce, industry, labour, agriculture and other primary industries, government,

Productivity Council

consumers, professional groups as well as those from other walks of life. They are to pool their combined knowledge and skills to assist industry in achieving a more effective utilization of Canadian resources.

In the course of his speech the minister also referred to the importance of agriculture. If time permits, I will have something to say about the effect of research, science and technology on agriculture in Denmark and Holland as compared with what we have here in Ontario, say, where the climate and soil conditions are pretty much the same.

Like everyone else in this country and elsewhere we would like to see a Utopia, permanent prosperity. Some people seem to have the impression that we should be having that in this country and in every democratic country. However, I believe that people with an ordinary amount of judgment do not fall for such a fallacy. There are various reasons, though I cannot develop them at this time. One is purely economic; the second is economic as well as political, because the keystone of our economic situation in this country as well as in the United States is spending for military purposes-the same applies to many other parts of the world. It also depends on the spending of governments. The third reason is the growing debt structure in every country in the free world', together with creeping inflation. The fourth reason is the nature and history of business cycles. Unless we have regimentation, which none of us. thank goodness, will accept, we are bound to have these cycles in the course of our existence.

I should like to refer, first, to a statement in a book by Solomon Fabricant which has been quoted before by myself and by others* entitled-"Basic Facts on Productivity

Change":

Productivity has been much discussed in recent years, and too frequently misunderstood.

Productivity deserves the attention that it has received, for it is a measure of the efficiency with which resources are converted into the commodities and services that men want. Higher productivity is a means to better levels of economic well-being and greater national strength. Higher productivity is a major source of the increment in income over which men bargain and sometimes quarrel. And higher-or lower-productivity affects costs, prices, profits, output, employment and investment, and thus plays a part in business fluctuations, in inflation, and in the rise and decline of industries.

Indeed, in one way or another, productivity enters virtually every broad economic problem, whatever current form or new name the problem takes-industrialization, or research and development or automation, or tax reform, or cost-price squeeze, or improvement factor, or wage inflation or foreign dollar shortage.

A good deal is likely to be said about productivity before this debate ends. We in this country realize the important part

Productivity Council

research has played in placing us in a competitive position with respect to world trade. Even now that we have priced ourselves out of the market in many fields, we carry on in an endeavour to meet the competition which faces us. Unfortunately, our standard of living is such-second only to the United States-that we have priced ourselves out of world markets. Countries such as Germany, France, Japan and even India have arisen to challenge every nation in the world. We have resorted to research, and I think it is important that we have become research conscious in a fashion. However, I have my doubts whether that can be applied to industry.

We are fortunate in this country in having a national research council. We also have other activities in research going on in the various provinces and in universities of which we are very proud. But I have maintained over the last ten years that industry in this country has lagged with respect to its responsibility for keeping pace through increased research with world demand and requirements. We have not had it. We have been depending too much on research in foreign countries, because much of our industry has its head offices in the United States or in some other foreign countries.

We have repeatedly suggested that these industries in Canada should set up research establishments in this country in order that we might participate as a country in the advances which research makes possible. Moreover, we would be keeping our scientists and research men here in Canada instead of exporting them to the United States after this country has been put to great expense in providing them with an education, only to find them leaving for the United States and becoming a valuable asset to that country where they find themselves, because of their brains and ability, in competition with their former homeland.

In comparison with the United States and the United Kingdom the main deficiency in Canada is in the industrial field. I have said that almost yearly for the last ten years. In particular, industrial research by firms themselves is lagging behind. It is known that in a number of fields there are industrial processes which have direct application in Canada, but funds are not available for research and development work in connection with these projects. The government has indicated a definite interest in promoting things which may lead to the more extensive processing of materials in Canada on an economic basis. We do not need to go very far in order to realize that we are exporting our natural resources, in many cases in the

lMr. Murphy.J

raw form, when, probably through investment and research, a good deal of those products could be processed or partly processed in Canada thus providing employment for Canadians.

To meet the deficiency in industrial research and possibly to do something in response to the government's interest in further processing, the government might wish to consider the establishment of a new organization which for the purposes of these remarks is referred to as Industrial Processes Limited. I suggest that the government might give consideration to this idea. We set up just recently, and it is all to the good, a medical research council independent of the national research council and I think that action commended itself to every member of the house. At the present time the government takes action to assist purely scientific research-N.R.C.-scientific research with a defence application-D.R.B.-applied research with a defence application through -D.D.P.-and pure and applied research in the atomic energy field-through A.E.C.L. If action in these fields is desirable, it is at least worth considering action in a field now omitted-applied research of an industrial character in on-defence fields.

I make this suggestion after thinking and talking research in this house for a great many years, and this is a non-political subject of great concern to every Canadian. We have had marvellous participation and support not only by members of every party here but also by the press across Canada. I make it for the purpose of accelerating and promoting research in this country. Let there be no mistake about it, we are more research conscious in Canada today that we have ever been, but we still need an awakening. I think that through more research in the industrial field in particular Canada would reap many benefits far out of proportion to the amount of money that is spent by the government, by industry and by other organizations concerned.

I have not time to explore this topic at any length, though I should like to. Perhaps an opportunity will be afforded later. As the previous speaker indicated, we are to have a committee set up known as the research committee, and perhaps at that time some further comment would be in order. I am making my present remarks very briefly, but they could be enlarged upon later.

The purpose of Industrial Processes Limited would be:

1. To receive applications for assistance in the proof or development of new processes or adaptations of processes that would be applicable to materials derived from Canadian resources.

2. To confirm the possible feasibility and likely application of such processes.

3. To determine the possible importance of economic application of such processes for Canadian industry or trade.

4. If confirmed, to provide assistance in a suitable form.

5. To keep in touch with and advise on actions taken for proof or development of processes.

One could go into the question of organization and assistance, and so on. It would not require a great deal of government financial assistance because as I visualize it this particular company would require only a small amount to get it initiated. I am sure this company could be a success and the initial assistance could be followed by industrial contributions and royalties. This could be set out and explained at greater length.

I suggest that in an economy such as ours if industry will not spend its proper share in research perhaps it could be urged to spend more through an organization such as this. Possibly there are other avenues that industry could use to increase productivity through research.

The council will be able to take cognizance of our population growth over the next 10, 15 or 20 years. I think that is important. The council must have a basis upon which to make assumptions from which they must later on adduce facts and arguments leading to particular conclusions. The reason why we can be so certain of our population expansion is that in reckoning the adult population for the next two decades we do not have to predict because we know. The same applies not only in Canada but in any other country. The major events that determine the future have already happened irrevocably. The economic population of the next 20 years, its numbers, its age and its sex distribution is not just predictable, today it is already in being.

There can be little doubt that total hours of work will continue to decline as a result of longer vacations, more holidays and a shorter work week. People have decided to make it very clear that they desire greater leisure, a big slice of any increase in productivity. There will be a population increase of one fifth in the next 10 years. Total population of working age will increase only by one tenth. Population actually available for work will increase only by 6 per cent. The total hours worked by the whole economy in the course of one year may not increase at all.

There is only one effective way to control long range inflationary pressures, and that is increased productivity. The president of

Productivity Council

General Electric announced a year ago that by 1965 his company will have to produce and sell twice the volume of goods it turned out in 1954 with only 11 per cent more people on its payroll. Adjusted for the expected decrease in working hours this means that 10 years hence General Electric must be able to produce twice as much for every hour its employees work. To achieve this, productivity will have to increase 40 per cent in the next 10 years. It will have to be doubled in the next 20. Despite all the emphasis we have given to productivity in recent years we really know very little about it, and we certainly do not know how to measure it.

To obtain productivity the first requirement is capital. We must increase the productivity of capital itself by one sixth during the next decade and by one third during the next 20 years. The economic progress might even be defined as the process of continually obtaining more productivity for less money. The means to achieve this is by innovation. Without constant innovation all the capital invested in this country since confederation might have been barely enough to permit the present population to live at a confederation scale of living. The entire improvement of living standards since then is the result of innovation. Innovation has been the real frontier of the western world these past two centuries. What now distinguishes an underdeveloped country and keeps it underdeveloped is not so much a shortage of capital as it is shortage of innovation.

To the layman and the typical business man innovation means research or engineering, new products or new productive processes. The most important area of innovation and the most productive one may well be the opposite of technological, that is changes in distribution methods. Another would be development of new concepts of business organization and, third, management tools.

I believe we must take a close look at the present setup in Canada concerning presentations to governments that are made by all segments of society. There has been a need for an examination of this kind since I have come to this house. In many instances those making presentations do not receive the understanding to which they feel they are entitled. We do not have to go far in searching for illustrations.

I mentioned that firms attempting to do business in this country have been subject for far too long to delays by government officials. I know of concerns over the past 10 or 20 years that have applied for an interpretation or explanation of a tariff item and have had to wait for as long as two years or more for the usual unfavourable decision.

Productivity Council

Thank goodness an arrangement has been made under which the tariff board is able to hold more frequent sittings.

We have in this country a sort of free trade mentality among some of our advisers. I wish to show that some people believe that the words "free trade" or "tariff" are so entirely opposite that it almost amounts to a crime to use either one. We have people in Canada who believe that when you mention the word "tariff" you are in favour of higher tariffs.

The policy of this government and even of the previous government has not been to tinker with tariffs to any great degree. We all have to agree with that. When hon. members on this side sat on the opposition benches we heard arguments from people who did not know any better to the effect that a certain idea being promoted was a high tariff or free trade concept. It is time that Canadians understood that there is no such thing as a free trade party in this country and there never has been. Some of the advice that industry receives from some of our senior officials would indicate that the officials favour the importer over the manufacturer in this country. I do not think that is fully consistent with what we require under today's conditions or even under tomorrow's conditions.

_ Let me take for an illustration the chemical industry. This industry has existed in a flourishing state not only in Canada and the United States and elsewhere in the free world but behind the iron curtain as well for only a short period of time. It is still in its infancy. Plastics are produced in Canada today. Twenty years ago the Canadian chemical industry did not amount to anything. We had some oil refineries but they were neither chemical or petrochemical industries. Today we have chemical and petrochemical industries from Ontario through to the west. I know of one company, the Dow Chemical Company, whose Canadian parent office is in Sarnia, which has practically a $100 million investment in Sarnia, Toronto, in Saskatchewan, in Alberta and in British Columbia. They are producers of many products including plastic products.

The chemical industry is a huge industry, a huge empire, a giant in the United States and elsewhere, and it is becoming easy for many of the other countries which can produce these products to ship into Canada. The complaint I am making to this committee and to this government-and I made it often to the previous government and it is time that somebody took notice of it; I expect this government will; if it does not it will hear from me again-is that we have flagrant out and out dumping in this country. That dumping continues while checks are being made. I submit that when a responsible industry,

tMr. Murphy.]

a producer of, say, plastics in this country makes a protest or a suggestion to the government that there has been dumping that protest and suggestion should not be just ignored. Unfortunately, it is the foreign manufacturer who apparently has the ear of those people who formulate policies which are laid on somebody else's desk. A United States manufacturer can sell an off grade product at a depressed price in his home market, and then move the same product into our market at a depressed price so long as he calls it off grade. It is about time that we took notice of this.

I still have six minutes to go, Mr. Chairman, if you are rising to call me to time. It seems to me we have now reached the crossroads in Canada's economy. The world has divided itself into trading blocs. We have two huge ones in Europe; maybe others are in the making. We hear some comments respecting an American bloc. At the moment we are being urged not to trade with certain nations but we have shown the proper spirit in that regard. I suggest that we have to avoid the fiscal errors we have made in the past. We can no longer allow the economists to practise on us. We must use economic methods which to some degree have been tested and found to have merit.

Before I close, I should like to say-and I have said this before in the house-that this council will have to consider tariffs or rather the administration of tariff regulations. I hope it does consider some of the answers that industry has been receiving about its suggestions and representations. If you take the actual tariff exactions levied during the Laurier regime and the later regime of Borden and Meighen, King and St. Laurent, up to date, you will find that, taken as a percentage total of imports, they vary by less than a fraction of 1 per cent. If anybody wants to verify that all he has to do is to spend about $2,000, which I did, to make this survey some four or five years ago, and it took a lot of research to do it, but that is what it amounts to.

We hear people talk about free trade and tariffs. I would suggest they make a study; they can have my study at no cost to them. What we should try to escape from is this state of academic anaemia in which our discussions on trade policy are conducted. In the face of the record I have mentioned what is the use of discussing free trade as a practical political proposition? All such discussions do not alter the fact that there is no genuine free trade party in Canada and there never has been. I have said that before and it is worth repeating.

Since we have a tariff which, as I said, has not varied one half of one per cent from the

days of Sir John A. Macdonald who laid the cornerstone of that policy, why do we not be fair and reasonable about its application? Why should good industries that have entered Canada at the request of the government-and we have many of them-to supply vitally needed war materials and which now employ many thousands of Canadian workers at the best prevailing rates of pay be made the victims of a hypocritical trade policy? We want people employed in the country; we want to import what we require, but I say here and now, we want to give our industries the opportunity to hire people, to hire Canadians to produce what we want. We must expect to continue to have imports; we welcome imports because trade must be a twoway street. I am not advocating higher tariffs. This party has never advocated higher tariffs, in spite of what has been said by speakers at various times since I have been in the house.

Topic:   PRODUCTIVITY COUNCIL
Subtopic:   MEASURE TO PROVIDE FOR ESTABLISHMENT, EXERCISE OF POWERS, ETC.
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LIB

Lionel Chevrier (Official Opposition House Leader; Liberal Party House Leader)

Liberal

Mr. Chevrier:

Oh.

Topic:   PRODUCTIVITY COUNCIL
Subtopic:   MEASURE TO PROVIDE FOR ESTABLISHMENT, EXERCISE OF POWERS, ETC.
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PC

Joseph Warner Murphy

Progressive Conservative

Mr. Murphy:

Yes; I can say that with all sincerity. My hon. friend knows it.

Topic:   PRODUCTIVITY COUNCIL
Subtopic:   MEASURE TO PROVIDE FOR ESTABLISHMENT, EXERCISE OF POWERS, ETC.
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LIB

Lionel Chevrier (Official Opposition House Leader; Liberal Party House Leader)

Liberal

Mr. Chevrier:

I do not know it.

Topic:   PRODUCTIVITY COUNCIL
Subtopic:   MEASURE TO PROVIDE FOR ESTABLISHMENT, EXERCISE OF POWERS, ETC.
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PC

Joseph Warner Murphy

Progressive Conservative

Mr. Murphy:

All you have to do is to read a little bit more and do a little research work and you will find out that we have not advocated higher tariffs.

Topic:   PRODUCTIVITY COUNCIL
Subtopic:   MEASURE TO PROVIDE FOR ESTABLISHMENT, EXERCISE OF POWERS, ETC.
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LIB

Lionel Chevrier (Official Opposition House Leader; Liberal Party House Leader)

Liberal

Mr. Chevrier:

Read the speeches of some of your colleagues.

Topic:   PRODUCTIVITY COUNCIL
Subtopic:   MEASURE TO PROVIDE FOR ESTABLISHMENT, EXERCISE OF POWERS, ETC.
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December 12, 1960