Peace and Prosperity—The Challenge of Our Day

MR. CHISHOLM: The Empire Club and the Canadian Club have gathered today to do honour to His Excellency, The Honorable Stanley Woodward, the United States Ambassador to Canada. In turn, our Clubs are honoured to have Mr. Woodward with us and it is natural and proper that a joint meeting should be called for this purpose.

In these troubled days of violence and heartbreak throughout the world, perhaps the one rewarding element is the opportunity provided, and the seizing of that opportunity, for collaboration of men and nations of high integrity. In the first instance, that collaboration is expressed in the exchange of ambassadors of real attainment and sincerity.

Mr. Woodward was educated at Yale University and the School of Political Science in Paris. He served with the U.S. Army during the First Great War. Since 1925 he has been serving his country in the Foreign Service division with postings in Geneva, Brussels, Haiti, until 1934, when he returned to America, becoming Chief of Protocol in 1944. Now, once again, Mr. Woodward is serving in a foreign country.

From the outset of his Canadian assignment, Mr. Woodward has gained the respect of the official Ottawa group and, with the same feeling, we welcome him here today to speak to us under the timely headline "The Challenge of Our Day".

HIS EXCELLENCY: I had planned to talk to you today on a rather familiar theme--our good relations as neighbours. But the Chinese Communist attack in Korea--the second act of brazen aggression in that land in five months--has changed everything. We are on the brink of the precipice--and we see before us the abyss of war.

It is important--especially in the light of these last few days--that we make an estimate of the situation. This includes an assessment of our strength. We know only too well what the others have to offer. We must reassess what we have--our strengths and our potential power--particularly here on the North American continent.

We have here what we would like to see everywhere in the world--peace and prosperity, flourishing under free institutions. And more especially we have a comfortable relationship. We trade with each other, visit each other, enjoy a common cultural heritage, equivalent standards of living, the same books, magazines and movies, football, baseball and hockey games--in short the same standards, the same tastes.

Of course, we've had disagreements--and we'll probably continue to have them. People who live as close together as we do are bound to have them. Together we learn to appreciate each other. We move constantly toward closer understanding and toward easier settlement of the problems that confront us.

But when a crisis comes, we stand together. And the rest of the world has come to realize that Canada and the United States live and stand together--representing the North American view and a mutual approach to the problems of the day.

If we wish to examine our common position we could not go back to a better time than 1941 ... when we were faced with dark days and the need for courage and momentous decision. At that time our two great leaders--President Roosevelt and Prime Minister Mackenzie King--sat down together to plan.

I sometimes think that, in a larger sense, that historic conversation at Hyde Park in 1941 was more than just two great men planning to meet a crisis. It represented two great nations continuing their joint efforts to meet, together, any crisis that might arise at any time.

When that meeting was over, Mr. Roosevelt and Mr. King issued what has become known as the Hyde Park Agreement. That was the charter of Canadian-American co-operation during the last war.

Vital as that Agreement itself proved to be, to the winning of the war, I want to point out here today two significant related facts. One is that the Agreement was only a symptom of the spirit of co-operation that made it possible when the need for it arose, and second, that principle of co-operation did not die when the war was won, but instead, has found new strength.

Specifically, the Hyde Park Agreement resulted in an unprecedented joining of the economies of the two countries. Supplies were pooled. Joint farm programmes were worked out. Industrial plans were geared together. The boundary was almost completely erased for wartime purposes, and a long stride towards winning the war was made.

Let me read one sentence from the Hyde Park Agreement of 1941: "It was agreed as a general principle that in mobilizing the resources of this continent, each country should provide the other with the defense articles which it is best able to produce, and, above all, produce quickly, and that production programmes should be co-ordinated to this end."

I won't take time to detail here how it all worked out, because that war is over and won. But since another crisis faces us now, we may look back at that effort as a guide.

Joint committees were set up. One of the most important was the Material Co-ordinating Committee. Another was the Joint Economic Committee. Another was the Joint War Production Committee. There was the Joint Agricultural Committee. There were others.

These joint committees dealt with export control, with shipping and with production problems. The committees specifically considered such matters as Great Lakes shipping, tariffs, price controls, production priorities, power and paper shortages, the Atlantic fisheries, the Alaska Highway, civil aviation routes and atomic energy research.

When the war was over, naturally many of these joint actions were dropped.

But the basic relationship of co-operation and interdependence and neighbourliness remained. That doesn't die just because committees adjourn.

And so, today, when aggression once more threatens our security and the peace of the world, we are drawn instinctively together again.

Recently another Declaration was made. Another acceptance of the Hyde Park principle was agreed upon by our two countries.

With the signing of this historic document, called the Statement of Principles of Economic Co-operation, our two countries pooled their resources in a common defense against aggression. Once more we have jointly mobilized our industrial economies.

Although this recent agreement between our two countries for our joint industrial mobilization has been widely discussed in the press during the past month or so, and has met with universal approval on both sides of the border, I should like to review its six general principles again today.

1. The two countries shall develop a co-ordinated programme of requirements, production and procurement. This means that we decide together what we need; we work together to make it; and we see to it that it gets where its needed. That makes sense.

2. There shall be co-ordinated controls over the distribution of scarce raw materials and supplies. This means that we will share our common resources.

3. Such control shall be mutually consistent and administered to achieve comparable effects in each country. This means that we both get an even break. We will consult. If we have to put on a control of some kind which would have an effect on the use of materials, the corresponding Canadian control will serve the same purpose.

4. There shall be free exchange of technical production knowledge and skill. We won't operate on a secret basis.

5. Barriers impeding the flow of essential defense goods shall be removed as far as possible. It wouldn't make sense if we were to produce defense goods and then couldn't get them back and forth across the border as we need them.

6. The two governments will consult concerning any financial and foreign exchange problems resulting from the implementation of the agreement. This will insure that we will consult whenever dollar exchange problems arise, so that defense purchases will not be held up.

This agreement is a statement of principles and does not contain specific arrangements. It is the framework within which specific arrangements can be made as they are convenient and necessary. The agreement does not contain provisions concerning the lowering of tariffs or other particular projects. In other words, the agreement contains nothing new, but is a re-definition of the attitude of mind of each country to the other. It is an expression of the obvious mutuality of interest held by the two countries, geographically, socially and economically. It is intended to be the basis for economic co-operation in our common defense.

This agreement is supplementary to our joint and international agreements. Our two governments have no intention of abrogating or taking any action contrary to international agreements already entered into. In fact, this agreement strengthens our other international commitments.

This agreement in effect provides for coordination of our industrial resources for the common defense. Mr. C. D. Howe, your Minister of Trade and Commerce, summed up its objectives and expressed the general approval of this accord at the signing ceremonies in Washington when he said "Traditionally, Canada and the United States march side by side in time of war. The fact that in the field of military preparation we will march together in an effort to prevent another war will be reassuring to the peoples of both countries."

I should like to stress the fact that our industrial mobilization is not aimed at increasing the net trade between our two countries. It is not a reciprocal trade agreement. The United States is not searching for defense orders to swell production. Our plants are already working full time. Your industrial machine is also working at capacity. Joint industrial mobilization is not a commercial proposition--it is aimed at making the most effective use of our common industrial capacity for our mutual defense.

On the other hand we know that foreign trade is the lifeblood of international peace and prosperity. As a demonstration of this fact we have just a few weeks ago eased the entry of goods into the United States through an administrative reform of customs procedure. We are planning a major legislative Customs Simplification Act. Both actions are aimed at increasing imports and thus bringing into better balance the international trade of the United States.

At this very moment we are negotiating also at Torquay with between 30 and 40 other nations to reduce tariffs and other trade barriers. These steps are based on our desire to see a stimulation of international trade--and a resulting increase of standards of living throughout the world.

There is another very important subject of common interest that I want to mention here today. It is the joint development of the St. Lawrence for navigation and for power.

A few weeks ago I was in Washington where I saw President Truman and talked with him at some length. Among other things we discussed the St. Lawrence Seaway and Power Project. I told him how much Canada wants to see a start on the project. He replied: "So do we. It's an urgent matter--and I intend to press it at the next session of Congress."

The project has a new urgency. In the Executive Branch of the United States Government we realize that. We know that the demands of the present situation call for a start on the project and for its completion as rapidly as is physically possible. In the United States--as in Canada--and as in the countries of our partners and allies--we are building up our military strength--believing that strength is the best guarantee of peace. Armed might is based on industrial might. Industrial might, in turn, is based on constant growth and development. New and better power sources and new and better means of transportation are needed to help develop a more efficient industrial system. The St. Lawrence Project will provide both.

The St. Lawrence and the Great Lakes provide a waterway from the Atlantic Seaboard for 2,225 miles straight into the heart of North America. It is a natural route to follow--it could allow deep draft ocean-going vessels to sail to and from the rich food-producing states and provinces of the prairies as well as to and from a great industrial area. With the Seaway, cheap water transportation would bring goods at lower delivered prices to the cities and towns of the interior--it could move their production at an increased rate to overseas consumers.

The Seaway is more than an economical way to move goods. It is a safe way. It would provide additional facilities for the movement of ships. It will make possible the construction of ocean-going vessels in inland areas.

A new impetus has been given to the construction of the Seaway. That is the discovery of rich iron-bearing areas in Labrador. We need iron ores. The Mesabi range in Minnesota is on the way to exhaustion. Resources in other continents--in Africa, South America--may not be available in time of war. But iron is there at Ungava. In a few years iron-bearing hematite will be flowing at the rate of some 10,000,000 tons annually over the 360-mile railroad from Knob Lake to Seven Islands. It is in the interests of both our countries that this ore be trans- Thus, the project is more to us than an entry to the mid-west or more power for the northeast. It is an important means by which the whole of North America can be strengthened.

The combined project is so important to our continent that we feel that power and navigation must go together. We believe that the interests of the community should not be sacrificed by proceeding with one or the other parts of the project separately. We don't want to split them up. We consider this a North American project--not a regional one. All contributing to the cost, and all benefiting--either immediately or in the longer run as the wealth and strength of the entire continent is increased.

As I said before, the St. Lawrence Project has a new urgency. Our time for preparedness has shortened. We need to gird ourselves. We need to see our strength grow. That's why the United States Government backs the project most earnestly. In the Executive Branch, the President, the State Department, the Department of Commerce, and various other Government departments are all working hand in hand to put across this view. The President has assured me that he will emphasize to the new Congress in January the importance--the new urgency of the St. Lawrence project. I hope that the 82nd Congress will give the plan its most earnest attention and that we will all see--at some early date--a start of construction.

All these things strengthen our joint defense, and that seems necessary today in these troubled and critical times. Both our countries, the United States and Canada alike, wish that our tremendous joint resources, our enormous national energies, our inventive genius, our industry and all our strength and skills-we wish that all of these could be directed toward building, toward prograss and prosperity and peace.

Both of our countries--in this prosperous neighbourhood of ours--have become great through the years because we have chosen a very simple policy. We have been builders by instinct. We have chosen peace, throughout our history, rather than conquest. By that policy we have reported over the most economical--and at the same time--over the securest route. That--The Seaway will provide. Equally with cheap transportation, we need cheap power. We need it urgently, not only for normal use in farms, homes, and factories but especially to help in expanding important chemical, metals, and other industries vital to our defense efforts. You need more power here in Ontario, and we need it in our northeast.

I have visited the Tennessee Valley several times and have seen the benefits and wonders that cheap public power has worked for that region. TVA has done far more than provide rural electrification. It has attracted industries--it has upped the standard of living--it has raised incomes for the farmer, the factory owner, the worker.

This fall President Truman asked for the formation of an interagency committee of government departments and I quote from the President's letter "to initiate a comprehensive survey of the resources of New England and New York and prepare recommendations for the development, utilization, and conservation of these resources."

My Government is making this survey in co-operation with the six new England states and New York. There are certain projects in the area to be covered which should be started as soon as possible as good investments for the future of the region. Among these are further development of the Niagara Falls power potential and the construction of the St. Lawrence Seaway and Power project.

That is the view of the United States Government. Perhaps it may seem a bit one-sided as I've presented it. We also take account of the other side. We realize that the St. Lawrence Seaway and Power Project is important to Canada. As we do, you also have an East deficient in low cost power and that deficiency is therefore hindering the development of industry and the utilization of existing natural resources. The seaway and additional power are essential to your economy and to your defense. And we know well that what makes you more prosperous and what makes you better able to defend yourselves adds to the prosperity and to the security of the United States come powerful and rich and strong. And because of our strength we have become secure.

But--and a very big but--our security is menaced again. Back in June--it seems more than just a few months ago--saw the North Koreans obey the orders of their Russian masters when they swept over the 38th parallel to attack the Republic of Korea. There the United Nations met the challenge. We were all tremendously heartened when we saw 53 nations combine to condemn an unwarranted and dastardly aggression. We were further heartened months later when the United Nations troops--after almost being driven into the sea--lashed out at the invading communists and slowly but relentlessly drove them back. We have seen the North Korean aggressor virtually disappear as a fighting force with the United Nations arms inflicting on them one defeat after another.

Then--in line with the United Nations decision to unite the whole of Korea and to prevent any future repetition of a surprise attack--the forces of General MacArthur, under the blue and white banner of the United Nations, appeared near the successful completion of their mission. In the United Nations General Assembly we were discussing plans to rehabilitate Korea--to bring about stability of economic and political conditions.

But then from across the Manchurian border swarmed the Chinese Communists. In a blatant and arrogant fashion they attacked the forces of the United Nations and defied all of the 53 nations which had earlier condemned North Korean aggression. They attacked--and yet at the same time they came to Lake Success--attempting to charge illegality in the UN stand against aggression, and attempting to cloak their own aggression, with a wordscreen of spurious charges.

This new crisis has created a situation of great danger. The concept of world peace is gravely menanced. And the tragedy of it is--as Secretary of State Acheson said last Wednesday night, and I know from my own experience of living in China--it springs from no interest of China or the Chinese people. No, this is an aggression planned by and for that small clique of Communists ruling China, men nurtured and trained on the Communist dogma whose aim is subversion, dissension, aggression. Where does this new act of aggression lead us? What are we to do in face of this demonstration of the contempt of the Communists for the United Nations? How must we react to this apparent acceptance by the Communists of the risk of a general war?

It is manifestly our duty to face squarely the danger which confronts us. I think it important at this time to take a look at what the other side stands for. Communist philosophy--made clear as crystal in the writing of Lenin and Stalin--is based on the contention that Communism cannot live in a world where free nations exist. This is the threat to our survival. We must be strong, wise, moderate, steadfast--with constant purpose yet flexible in action. We cannot panic. We may disagree at times in the methods of achieving strength--but we must make it clear at all times that we are determined to hold on to our freedom and that we are determined to strengthen ourselves to resist any aggression, anywhere.

We also have a definite programme for guarding the peace. First and foremost, there is the United Nations. We have seen that organization grow to its present stature as an effective and working group and we are not willingly going to see it fail. We are not just talking but fighting to preserve our way of life. Then we have regional defense pacts, built within the framework of the United Nations charter. The North Atlantic Pact is more than a grouping of like-minded nations for defense. It is the development of a community spirit and of a sense of confidence in each other. Through our common interests and common desires it welds us together.

Then we have economic co-operation--an essential part of our common defense effort. It is through the strength of our economic system and by the development of the capabilities of each free nation, that the necessary pitch of military preparedness can be reached. Admittedly, we cannot have guns and at the same time have all the goods to which we are accustomed. There must be sacrifice.

We must allocate to defense those raw materials, those production skills, which are needed.

Furthermore, as Secretary Acheson said--in our strategy we must maintain a readiness to negotiate. He said: "The free nations must always be prepared to enter into genuine negotiations, and even to take the initiative in efforts to bring about honest negotiations."

All of this makes sense.

We must be ready to negotiate, but we must make it plain that we will not appease--that we will not sacrifice the principles we believe honest and real for any false hope of peace.

We hope to preserve the peace and to avoid war. No one can be sure that a war will not come. There is no sure answer. We can only hope for the best--and prepare for the worst.

Each of us--every like-minded person--has a definite responsibility. We cannot shrug off that responsibility. We can't say: let the UN decide, let our leaders decide, let our representatives decide. Each of us must decide. Each of us must sacrifice. Each of us must shoulder his share of the common burden.

I have spoken of material things, but I cannot end without stating my conviction that through all this activity there runs a strong strain of the spirit. We do not live by bread alone. We are Christian peoples. We are men of faith. We have faith in God, and faith in our fellow man. We fear God, and try to keep His commandments. Let us thank God we do not have to fear anyone else, or keep anybody else's commandments. We are fortunate--the world is fortunate--that this is so. For in this time of stress and strain, in this hour when we must again beat our ploughshares into swords, and our pruning hooks into spears, it is through that faith in God and in ourselves we shall answer today's challenge.

VOTE OF THANKS, moved by Past President H. G. Colebrook.