June 14, 1935 (17th Parliament, 6th Session)


Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)


Let us go a step further in reply to the observations that were made. It was said that there was no record of what had transpired during the years from 1930 to 1935. I hold in my hand the Journals of the House of Commons, No. 72, of 1934 and I commence with t'he select standing committee on banking and commerce. Turning first to the index, I find all the orders in council affecting the operations of this selling agency are printed in full and were before the banking and commerce committee and brought out in testimony. Second, as I shall presently indicate, Mr. McFarland was before that committee, and what is more, before he commenced his statement at all, a motion was presented at the opening of that committee's meetings by Mr. Power, seconded by Mr. Vallance, that certain information should be made available to the committee, the house and the country. Among these matters hon. gentlemen will find this resolution: At Page 17 Mr. Power,
seconded by Mr. Vallance, moved the following-I leave out the others, take this one, No. 4:
Relations of the chartered banks to the wheat pools, and the extent to which the guarantees by the dominion government to the banks, of the said pools' grain market account was utilized for the purpose of speculating in wheat on the Winnipeg or Chicago grain pits.
That was the language with which the resolution was clothed. Winnipeg or Chicago grain pits, and speculation.
When the committee met, the Minister of Finance (Mr. Rhodes), speaking for the government on the 13th of March, stated to the committee that so far as the government were concerned they had no objection to the motion passing. The motion in fact did pass, and what is more the order of conduct of that committee was arranged and settled by the committee itself, and Mr. McFarland was called as a witness for the purpose of giving the evidence required. In addition to that Mr. Roberts was called and produced the orders in council which as a matter of fact had been available long before that. So that upon the records there is at the moment a complete statement of the investigation carried on by a committee of the House of Commons last year in which questions were asked by the hon. member for Swift Current (Mr. Bothwell) who examined the witness,

by the hon. member for Willow Bunch (Mr. Donnelly) who spoke last evening, by the hon. member for Antigonish-Guysborough (Mr. Duff) who spoke the other day-not in respect to this matter-a long tedious examination going into all the details of these transactions. And when the question came up as to the number of bushels of grain that were then being carried a number of members raised the question, and the Minister of Finance said he had no objection so far as the government was concerned to this information being given if it was considered to be in the public interest, and the committee by a vote of thirty-three to nine concluded that it was not desirable that the evidence should be given. The committee voted, with eastern Canada Liberals forming the minority, not to have Mr. McFarland give that information. This is from the morning Citizen of March 23, 1934. The following Liberals voted to disclose the figures:
Hurtubise, Nipissing; Raymond, Beauharnois; Lapointe, Quebec East; Power, Quebec South; Mackenzie, Vancouver Centre; Ralston, Shelburne-Yarmouth; Howard, Sherbrooke; Donnelly, Willow Bunch; Duff, Antigonish-Guysborough. Conservatives, Progressives and the remaining Liberals on the committee opposed the publication.
The committee was composed of fifty members, nineteen of whom were Liberals, Messrs. Bothwell, Casgrain, Donnelly, Duff, Euler, Fraser, Howard, Hurtubise, Jacobs, Lapointe, Mackenzie, McPhee, Mercier, Michaud, Power, Ralston, Raymond, Sanderson, Vallance.
So that so far as this government is concerned it did not in any sense interpose to prevent the fullest information being given. What is more, Mr. Rhodes, the Minister of Finance on the opening of the committee's session of March 22 said this:
Mr. Chairman, apropos of the discussion this morning as to the method of our procedure, it will be recalled, in connection with the motion of Mr. Power, that, on the 13th of March, I made a statement to the committee on behalf of the government, which reads as follows:-
Speaking for the government I wish to say that it is our desire that there should be no suggestion of narrowing the inquiry. With respect to those topics which are within the purview of governmental activity, the government especially welcomes the most thorough investigation.
That was a restatement of the circumstances under which Mr. McFarland assumed the obligations and responsibilities he did, and the manner in which he discharged them. It has been suggested in this house that instead of endeavouring to deal with the matter as he should he was speculating.

Grain Board-Mr. Bennett
There is his answer, and I am bound to say that among those who know him Mr. John McFarland's reputation stands as high as that of any hon. member of this house. That is that.
Now let us proceed to the next point, which I regard as being of some importance; that is the meaning that has been attached to the words "option" and "futures." Mr. McFarland, realizing how great was the lack of appreciation of the technical use of those words, at page 212 said:
The use of the wprd "options" has caused much misunderstanding. Cash wheat purchased by elevator companies is, of necessity, sold for future delivery because it cannot be delivered until it has been transferred to the place where delivery of it can be made to the purchaser. The result is that forward sales, which are called "options" or "futures are constantly made. Every bushel of wheat that has been purchased by the Canadian Cooperative Wheat Producers Limited can be taken delivery of at the dates fixed for delivery, upon payment of the purchase price.
That was a restatement of what had been said by the Minister of Finance on March 13. So that so far as this house is concerned, through its appropriate committee in the year 1934 there was a full investigation of these matters as I shall presently indicate, the questions asked and the answer5, given, and when hon. members stand up in this house and talk about secrecy and lack of information and failure of the government to provide them with facilities for securing that information, I say that Mr. Rhodes, the Minister of Finance, speaking to that committee fully indicated the policy and purpose of the government that there should be no limitation place* upon any information that might be sought except so far as the committee itself might determine the advisability or otherwise of it being given
That is the position up to that point. Mr. McFarland was called as a witness. He gave evidence commencing at page 211 of that report. After reviewing the circumstances under which he came into office he proceeded in this manner:
I will now read you my reply to the notice of the proceedings of this committee:
"I notice that the proceedings of this committee, before which I have been asked to appear, refer to speculation in Winnipeg and Chicago wheat. I wish to state most emphatically that we have not speculated in a single bushel of wheat in the operations which I have directed for the Canadian Cooperative Wheat Producers Limited since November, 1930. Moreover, we have neither bought nor sold a single bushel of wheat or any other grain in Chicago. All our dealings have been in Winnipeg only. 'Speculation' as I understand it. means buying and selling stocks or
goods in the hope of profiting by changes in the market value. Our operations were governed by no such considerations. Our only object since undertaking the operations which I have directed has been to assist the farmer in marketing his wheat, that is, transferring it from his farm to the ultimate consumer. Under normal economic conditions, when there %vas a fair equilibrium between supply and demand, the operations of the market so adjusted themselves that there had never been any difficulty in maintaining a reasonable price to the farmer in the transfer of his product to the consumer. Conditions in the past few years in the Canadian market have been such that the normal play of forces has disappeared, and some machinery had to be provided to take their place unless the wheat was to remain on the farms of the country. A wheat board was the usual suggested alternative. The method that has been pursued since November, 1930, has been an application of the principle of a wheat board although Canada has not been directly interested in the transactions which have been made through the Canadian Cooperative Wheat Producers Limited, of which I was appointed by the directors, the manager, and which position I still retain. By the adoption of the method which we have followed, it was hoped to prevent the dislocation of the machinery of distribution built up over the la9t forty years."
That was the statement made at that moment, and which on cross examination by eminent counsel and by laymen as well was not challenged. Therefore when it is said that no opportunity has been afforded to enable this house to have a clear appreciation of the magnitude of the problems with which we have to deal I at once turn to what took place before that committee and ask this house whether in the light of those statements it can be said that opportunity has been denied. There are the facts. The committee went through the problems in connection with wheat from one end to the other. They dealt with the question whether or not he bought wheat that had been sold, the price at which it had been sold, the effort to operate on the market to prevent it falling below fifty cents, then falling to thirty-eight and a half, a statement of the world carryover, a statement of the world production, all those statements were made and the fullest possible information given to the committee. Oan it be said therefore that it was fair, that it was right, or even decent for hon. members to stand in their places and say, " If I am informed correctly" so and so is the case? Can a man base an argument upon such a contingency? Would he be listened to in any court of justice if he did? Would any court or parliament that had regard to the rules permit any member to make allegations such as were made the other day with respect to the operation of this pool, and then qualify and surround them with such ex-
Grain Board-Mr. Bennett

pressions as "If I am correctly informed," "If my knowledge is correct"? Never willing to assume responsibility for a definite statement, but always willing to predicate it on "if," and "if," and "if." That, sir, is my position.
I rely upon the statements contained in this journal of the house, to which the people of this country have had access through newspaper reports of what took place, in order to realize and ascertain just what is behind the attack that is being made here against Mr. McFarland, and just what it means. I ask this house to remember that they were not denied information, that they were not denied access to the orders in council, all of which are printed here right down to the end of the year 1033, and covering the operations of 1934, all the details of which were called for. It is true that with respect to the number of bushels the information was not furnished, but the hon. member for South Battleford (Mr. Vallance) said it was well known that there were 200.000,000 bushels, that it was common property, as has been said in this house by other hon. members. The hon. member himself stated it in the committee last year, yet they have the hardihood to stand up and say-

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