May 17, 1955 (22nd Parliament, 2nd Session)


Hazen Robert Argue

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

Mr. Argue:

Yes, on the domestic market but where the domestic market cannot use all the production, then the remainder is sold on the international market at the market price, and the farmer gets the amount that is obtained at the market price. For example, on wheat today it would mean a fair support price but still not parity. With parity for wheat today at perhaps $2.05, and as the hon. member says, if wheat sold outside Canada at $1.75 today the farmer would take the average and he would get less than a parity price.
Just as we believe that people are entitled to 100 per cent of justice in the courts and should not settle for anything less, therefore we believe that agriculture in Canada is entitled to full equity and full parity prices. We do not support anything less than full equity for agriculture.
I can point out that one of the first organizations that appeared before the cabinet asking for full parity prices and full equity for agriculture was not a farm organization but a labour organization. 1 hold in my hand a program for full employment as outlined by the national U.A.W.-C.I.O.-C.C.L. conference to fight for full employment, dated at Ottawa, February 24, 1954. In this program they have point eight, which is entitled "full equity for working farmers". It reads in part:
The impressive and productive efforts of Canadian farmers to assure Canada abundance of food and fibre should not be rewarded by depressing the living standards of the people who work the land.
We propose the establishment of a federal farm program that will provide full equity to working farmers, help meet their credit problems at low interest rates which only the dominion government can provide, improve markets, and include other measures necessary to permit farm families to enjoy higher living standards, consistent with a program of full employment and full production.
That is not the view of an agriculture organization; it is the view of very large trade union organizations. I know what the press will say. I know what the Sifton press in western Canada will say. It will claim that parity prices make for agricultural surpluses. That is a fallacious contention. As a matter of fact, the way you get agricultural surpluses is to reduce the general level of agricultural prices; and farmers, in an endeavour to protect their income, milk more cows, seed more acres to wheat and attempt to increase the volume of production in order to protect their standard of living. There is not an agricultural economist that I have read who says that the answer to surpluses in Canada or in the United States

is to reduce prices, because If prices are reduced surpluses will be increased.
The United States farmer this year is going to have to make a very difficult choice. He is going to be asked to choose between obtaining a support price for wheat at only 70 per cent of parity, which works out to about $1.70 a bushel, if he agrees to a 30 per cent reduction in wheat acreage; and, if he says no to that, production will be unrestricted and the support price will be $1.19 a bushel. There is a very great danger to the whole international price for wheat that the United States farmer, asked to accept an acreage reduction of 30 per cent in order to obtain 70 per cent of parity, will say, "I will take a gamble with full production, and take whatever the market will bring". That is the kind of policy with lower support prices that does not reduce surpluses; it adds to the surpluses, and that huge surplus then is available to depress the market further. So I say that anyone who claims that parity prices by themselves result in creating surpluses is wrong. Surpluses can be created, and surpluses have to be dealt with; but there is another way to get rid of surpluses than trying to lower prices to the point where you wreck the agricultural economy and by wrecking the economy hope that farmers will decrease their production.
The way to handle surpluses of food products is to increase demand. I am sure that there are many thousands of Canadians who are undernourished and who need more food. I am certain that no old age pensioner in Canada today receiving $40 a month has sufficient to buy the kind of food to give him an adequate diet and a reasonable nutritional standard. The government should adopt a policy which will give more purchasing power to our low income groups and to those on the old age pension. The government should provide a school-lunch program to take care of further agricultural surpluses. In other words, the government should adopt policies to ensure that every Canadian has an adequate diet. If that were done it would take care of a substantial part of any agricultural surplus that may appear. The government also should follow a policy of accepting soft currencies in exchange for wheat. The government should follow a policy of making wheat available for famine prevention and for a school-lunch program in the underdeveloped countries of the world. The government also, I suggest, should make advance payments for farm-stored grain in order that farmers can obtain purchasing power when they produce a crop and are unable to market that crop through congestion.

The government should encourage the storage of any temporary surpluses of wheat on farms as a method of saving storage costs. The minister has told us that the costs of storage have gone up in the past year very substantially-8J cents a bushel higher than the previous year. The farmer pays that 8J cents a bushel. The storage costs that are paid today are paid only to the elevator systems in this country and not paid to farmers, and that encourages the elevator companies, as the Minister of Trade and Commerce well knows, to expand their storage facilities in order to make greater revenues and greater profits. All of the time the farmer is paying the total shot. The farmer knows no reason why he should have to build his own storage on his own farm and then have to pay for the duplication of that storage by elevator companies. So I suggest to the government that, in addition to paying storage to elevator companies, which is part of the cost of marketing grain, they should adopt a policy of making storage payments on temporary surpluses of wheat available to farmers when they store their grain on the farm.
These are the points I suggest the government should now adopt to meet this very grave situation. There should be full parity prices for wheat. The government should immediately announce the interim payment on 1954 wheat and not wait till next December. The government should accept soft currencies and make wheat available for famine prevention and a school-lunch program. The government should make advance payments for farm-stored grain and encourage farmers by paying for storage of any temporary surpluses of wheat on the farm.
If this kind of six-point agricultural program for the wheat producers were put into effect, we would restore the purchasing power to this huge area of Canada. We would restore in a large measure the purchasing power to 200,000 farm families in the three prairie provinces. By so doing we would reduce the amount of unemployment in Canada, and, if we made available, as we should, our surplus food to hungry people and to underdeveloped countries, we would be making a very important contribution to peace far exceeding, I suggest, the contribution that is made even by our present defence program.

Topic:   FINAL PAYMENT, 1953-54
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