Mr. H. W. Herridge (Kootenay West):
Mr. Speaker, I just want to make a few brief remarks in connection with this most important subject. I must say it is always a pleasure for me to follow the member for Springfield (Mr. Sinnott). I love to listen to his pedestrian eloquence and his unusual philosophy. I thought this evening, Mr. Speaker, he made a masterly defence of continuing profits and static wages. I was much interested in his new economic philosophy- I think it was an economic philosophy which he advanced tonight. It concerned the question of subsidies being applied without increasing taxes. I wonder if the hon. member realizes that the moment you begin to apply subsidies you must have some control over the price of the product. At least I must give the member for Springfield credit for starting a new economic movement in Canada this evening. I was much interested, Mr. Speaker, while I sat here to listen to the Minister of Finance (Mr. Abbott) congratulating the member for Springfield on the excellent speech he had delivered this evening.
Mr. Speaker, I listened with great interest this evening to the remarks of the Minister of Trade and Commerce (Mr. Howe). I was glad to note that the government was concerned about the question of the rising cost of living. I believe it is the first time those remarks have been used by a government speaker in recent weeks in replying to questions posed by the increased cost of living. I believe, Mr. Speaker, we can safely conclude from the minister's remarks that the government is now getting seriously concerned about the increasing cost of living.
I listened to the Minister of Trade and Commerce with great interest because, as a matter of fact, he is one member of the cabinet who I believe speaks his mind, speaks bluntly and flatly. He said the government recognized the fact that inflation could undermine the foundations of society. I believe that is further evidence, Mr. Speaker, that the government is growing quite conscious of the demand of the Canadian people for some form of price control and subsidies, and of the increasing need for some form of price control and subsidies. The minister also mentioned that prices had increased ten per cent in the last ten months. That is an average increase of one per cent per month. If that continues for many more months, Mr. Speaker, we will certainly be approaching runaway inflation.
I do not think anyone would deny that it is because of the serious nature of the situation
today, because of the crying demand of the Canadian people for some action, that the opposition parties have taken the opportunity presented by the motion to go into supply to raise this question at this time.
Regardless of the statements made in the last two months by the Minister of Finance and by other spokesmen representing the government, as to the use of fiscal and monetary measures to combat inflation and as to the use of credit restrictions, it is obvious that those measures are insufficient. Like previous speakers, I would not for one moment suggest that price control is the complete answer to an extremely complicated and complex situation. But with prices rising as they are at the present time and the ineffectiveness to date of the government's methods, I think there is an indication that some further measure must be taken to regulate and control inflation of this economy.
To counter the arguments presented by government speakers, I think we cannot produce better evidence than the statements of members of the government themselves throughout the years in situations similar to this one. First of all, I am going to requote a statement that was mentioned this afternoon by the leader of the opposition and which I understood the Minister of Trade and Commerce to say that he concurred in today after the leader of the opposition had read it. On March 27, 1947, as reported at page 1813 of Hansard, the Minister of Trade and Commerce said:
The primary question that was asked of me was whether controls had hampered production. I can conscientiously say that since I have been associated with controls, which is from their inception, controls have never been permitted to hamper production.
There is a definite argument on the part of the minister against the suggestion that the imposition of controls would hamper production. The minister continued:
In fact, controls at the moment are greatly stimulating production in several important lines. In my opinion the over-all production today would not be improved by the immediate removal of controls. If the control of lumber were removed today -and lumber shows the greatest discrepancy between export and domestic prices of any commodity -I doubt if one additional tree would be cut. If the control of steel were removed, the over-all production of steel today would drop by at least twenty per cent. The reason is that under control we are able to take the surplus primary production from Sault Ste. Marie and move it to the finishing mills at Hamilton, Toronto and Montreal. We are able to bring billets from Sydney, Nova Scotia, something that is never done under ordinary conditions, and move them to Montreal and Hamilton and convert them into finished steel. Were this not possible, the over-all production of steel in this country would be at least twenty per cent less than it is at this moment.
Cost of Living
I think the minister was extremely correct in that statement, and I think conditions that prevailed after that statement was made proved it to be correct.
In addition to that, Mr. Speaker, I remember that on March 19, 1947 the present Minister of Fisheries (Mr. Mayhew), then parliamentary assistant to the Minister of Fisheries, made a radio broadcast-and I may say it was an excellent radio broadcast- which I quite well remember listening to. The minister took practically the whole period of that broadcast to indicate the beneficial effect that controls had had on the Canadian economy. The whole tenor of his remarks at that time was in support of the principle of controls and the benefits that the Canadian people had received from price control, subsidies and certain regulations that were necessary during that period.
I want also to refer to a statement by the former minister of finance, Right Hon. J. L. Ilsley, in the debate in March, 1947, on the emergency powers bill. I am just going to quote briefly what he said, as reported at page 1585 of Hansard of that year. During that debate the minister said:.
One can readily imagine how an abrupt and substantial rise in living costs would contribute to an unsettled state of industrial relations and to delays and interruption in the production of goods which are so eagerly demanded. It is not difficult to appreciate the hardship and the reduction in living standards that would result for the many families whose incomes are relatively fixed-wage-earners, school teachers, white-collar workers, pensioners, and so on.
Those are the very classes of people that the opposition have been, concerned about today and whose plight they have been presenting to the government.
That there would be profiteering and speculation in the necessities of life can be taken for granted. And it is an absolute certainty that many prices, after rising suddenly, would fluctuate widely, and later on decline perhaps as abruptly as they went up. To remove all controls now would be to ask for a sudden and disruptive jump in our prices and living costs at the very time when we can begin to see ahead of us the completion of the job of orderly readjustment. We would be throwing away many of the advantages of the policy which Canada has successfully followed when, with a little more persistence and a little more patience, we could pilot ourselves through the difficult period of readjustment without the dislocation and economic disorder which usually follows war.
If the government had only exercised a little more patience and had carried on those policies for a little longer period, in our opinion-that is, the opinion of the group to which I belong-we would not have entered the present condition of instability and insecurity.
On motion of Mr. Herridge the debate was adjourned.
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