Some Aspects of the Unemployment Problem and The Present Russian Trade Proposals

PRESIDENT STAPELLS occupied the--chair. He introduced Mr. Moore, who said: My two topics today are interlocking" and while I consider unemployment the most important; I recognize that Russia is today, and perhaps will be more in the future a factor in unemployment in this and other countries. In dealing with unemployment we are faced with the condition of mind of those unfortunate men and women who, through no fault of their own, find themselves dependent upon the willing charity of those more fortunate, or upon the relief made possible through the expenditure of money by the Federal, Provincial and Municipal authorities. In regard to the latter, no one conversant with the facts could pay too high a tribute to the magnificent manner in which all have cooperated to obtain the utmost benefit from that expenditure.

When the Federal Parliament made the appropriation last September there was a certain amount of doubt as to its providing full employment, and a suggestion by some sections of Parliament as to limiting the time when the money should be available. These were prompted by the feeling that because of our political differences in provinces and municipalities there might be a lack of responsibility for the expenditure of those funds; but due to the intelligence and good citizenship of those in authority everywhere party differences were sunk and the money used to the fullest possible extent. Yet, notwithstanding the expenditure of this money there appears to be a greater volume of unemployment than when the appropriation was made. I have no reason to doubt the statement of the Federal authorities that through the expenditure of this money between 180,000 and 200,000 people have been given part-time employment, but I think there is reason to question whether we had a fair estimate of the amount of unemployment existing when the survey was made last August. This country is one of the few that has no means of calculating how many unemployed there may be within its confines. The greater the unemployment, the less chance there is for those who are not actually destitute to register at the Employment Bureaus and make their wants known; they feel their time is better occupied in searching for available odd jobs than in registering at the Bureaus, where no jobs are in sight. The utmost care was taken, within the short time available, to obtain accurate data for the Employment Service Council at their meeting before the last session; the figures showed that there probably would be 200,000 unemployed during the peak of the winter season, whereas we know that, notwithstanding the amount of work provided by relief works, no less than 300,000 are still unemployed. I do not think this is entirely due to an increase in the volume of unemployment, though there has been a natural increase since August. The closing down of some of our primary seasonal occupations has accentuated the condition, but opening of these in a few weeks should relieve the situation to a similar degree. In spite of this, it is apparent that there is need for other government machinery whereby we can gauge the volume of unemployment, if we are to find a sensible solution for the problem.

In its broader aspect unemployment is not a new problem; it has been present at recurring cycles-in 1906, in 1914, and again in 1921. Public interest becomes aroused during the most acute period, but immediately that there seems to be a slacking off, either from weariness in well-doing or because of not being so directly affected in their social structure, the public is liable to forget and to leave the problem to those who have to face it individually. I want to ask that, should we be fortunate enough to have a reduction of unemployment in the near future, there should be no slackening on anyone's part in seeking a more adequate and permanent method than we have had for dealing with this problem. (Applause.) I am convinced that there are sufficient factors to make it a continual problem for some years to come, and it is up to Parliament and the Provincial and Municipal authorities to make their arrangements in that regard.

The recommendations made at the Federal-Provincial Conference of employers, employees and Government representatives in 1924 are still buried away in the Government files. There were also recommendations made by the Commission on Unemployment of the Ontario Government in 1916, although it is doubtful if some members of the present Government know of their existence let alone their portent. These should be resurrected; we must recognize that present relief works are finishing, and people cannot be left to private charity. This is a state responsibility. Unemployment today is worldwide, and so general in its application that in the different countries no less than 20,000,000 workers are unemployed. This constitutes a challenge to our entire civilization, not only to the general social structure but to our political structure. The Mathers' Commission, appointed in 1919 by the Federal Government, toured this country to find the reasons for industrial and general unrest, just prior to the One Big Union outbreak and the near revolution which occurred in this country at that time-of which perhaps those on the inside knew a little more than you on the outside; this Commission, after full investigation, reported that the foremost reason for unrest was unemployment and the fear of unemployment. This fear not only accentuates unemployment, but is equally as important a factor as unemployment itself. When a person becomes unemployed his spending power naturally ceases. The worker, seeing others being laid, off, becomes uneasy and restricts his spending powers to the minimum in order that he may face the issue as comfortably as possible if it comes upon him. The result is a reduction of buying power immediately reflected in the volume of business done in our stores and factories.

Even when we speak of 20,000,000 unemployed we do not get the entire picture, for under-employment is also a vital factor. We read of the fortunate position of France with regard to employment, but the latest figures show that the unemployed are increasing in number, and now total about 350,000. Mr. Picquenard, the Government representative of the French nation, speaking to the governing body of the International Labor Organization at Geneva in January of this year, drew attention to the fact that though there were only 350,000 registered as unemployed there were over a million who were working part-time. France had partly met its problem by putting the workers on part-time, and thus laid the entire burden on the shoulders of the workers instead of on the community as a whole. In Canada we have a vast number of people who are affected likewise. In the shops of the Canadian Pacific Railway they work from four to five days a week instead of the usual six. The Canadian National Railways has reduced its maintenance forces to the five day week also. The wages of some railway laborers on a six day week is only $24" and when this is reduced fifteen per cent, the condition of these workers is more than casually disturbed. If that reduction were for only a week or two they might scrape through on their reserves, but when the period is extended to six months, a year, or longer, their earning power becomes considerably decreased and is not sufficient to maintain a reasonable standard of living. Therefore we have to add the problem of under-employment to that of unemployment.

It is my opinion that our present economic system--call it a capitalistic system if you like--is on trial. If it cannot adapt itself to the needs of the nation, then something else must be substituted. Nations have demanded that the interests of their citizens as a whole are paramount over those of individual groups. Therefore, I feel that this is a problem in which capital is interested just as much as labor. The general aspect of the problem has been examined in many quarters. The League of Nations has economic committees studying this problem in respect to transportation, tariffs and other similar questions. The International Labor Office has a special committee studying labor and other social questions attendant upon this issue. The International Federation of Trade Unions has committees at work as have the International Chamber of Commerce and many other bodies. Many public addresses have been made on the gold question, the effect of the restriction of currency, the necessity of finding some more equitable distribution than the hoarding which is taking place in France and the United States, where almost 60% of the world's gold is said to be accumulated. The review of our Bank Act is due to come before Parliament for general revision, but at the present I know of no department studying the effect of these things, so far as they apply to Canada, in order that the Bank Act may be amended" if necessary, in the national interest. There should be an investigation of this particular question, so that authentic information will be available when the Act comes before Parliament.

You have probably read able articles on the silver question, showing its effect on the purchasing power of China, India and other nations; this is a vital factor in the problem of unemployment in its international aspects. I read a commendable article by a well-known and esteemed friend in Toronto, Mr. Burton, on the effect of war reparations on business and trade. Others have dealt with the same subject. Therefore, I do not need to go into these aspects of the unemployment situation, important and serious as they are. I might say, however, that when Germany had to meet its war reparation payments it found it essential to restrict the importation of wheat, and to introduce war-time rye bread, with the result that our prairie provinces felt the effect immediately; this was a contributing factor in the drop in the price of wheat, and we felt the reaction in the eastern part of Canada, so far as our industries are concerned. The world is so small that anything which depresses the purchasing power of the citizens in one country has its repercussion in other countries.

Another factor in the general situation is the tendency towards industrialization which has taken place since the war. In pre-war years industry developed in the industrial countries because there were virgin markets to explore. Canada was only a very minor industrial country up to 1914. When we were first called upon to build ships and make shells certain experts told us that it could not be done. However, this was accomplished so well that after-the war, we undertook, successfully, to build up an industrial population to convert our natural resources into the highest manufactured form in which they might be marketed. Every other country has followed suit-in Africa., India, China, Japan,, or wherever it may be, we find the same condition exists. A year ago at Osaka, in Japan, I went through the plant of the Japanese locomotive and bridge works, also their ship-yard, and saw there up-to-date equipment, fine machine shops, and intelligent workers as proficient as those in this country.

Canada has evolved a system, of intensive nationalization shutting out the exchange of trade which used to take place. Every country has adopted the same course, and coincident with this, paradoxical as it may seem, there has been a greater internationalism of capital. When the United States found some of its market closed, they went into Germany and other countries to manufacture. Japanese capital moved into Manchuria and into China to meet competition there. So we find this internationalization of capital occurring coincident with the nationalization of industry. This has an important bearing on the unemployment situation, because following these there has been the policy of restricting population. When our Alien Labor Act was passed in about 1908 it was well known that it only applied to one industrial country,-the U.S.A. being the only country having similar legislation; but when we examined the problem two years ago we found that nearly every industrial country, Great Britain included, had regulations as strict as our own restricting the admission of industrial workers. Therefore, workers can no longer migrate freely from one country to another when their own industry cannot absorb their labor. A man may learn to be an efficient pattern maker in Canada, but if he finds no occupation it is doubtful if he could move as comfortably to the United States as he could have, formerly. He may have to decide to be a common laborer at about half pay, and lose his technical experience. Therefore we find this nationalization of industry materially affecting our employment situation. Coupled with this comes the mechanization of industry in the industrialized countries. There has been a haphazard building of machinery into industries, and I doubt if part of it" when carefully examined, is really efficient. In my discussions with industrial authorities, they have acknowledged that machinery has been introduced and used on occasions when it would have been cheaper to use hand labor, taking into account overhead costs, the limited time the machine might be used, and the depreciation. I recall one simple instance of seeing a little cellar being dug in clear sand, going down only four feet, yet they had brought a steam shovel and several motor trucks across the city; I daresay it would have cost considerably less to have used picks and shovels. We have a craze for machinery and use it without regard to its effects on individuals. There has been too much money spent in machinery and too little money spent on men. (Applause.)

Our business today is to balance production and consumption. Experts have tried to give us new directions, but the labor movement, like naughty children, often refused to agree with them. We were told" during the war, that it was essential to issue tax-free bonds. We know today that the purchasing power of these bonds is entirely out of proportion to the buying power of those who are dependent on wages. We were told that wage reduction was essential so that costs could be reduced. In 1921 railroad labor took a serious reduction and they have not yet got it all back. But has it brought any greater prosperity than if they had not taken the reduction? today farm producers are taking a serious reduction in the price of their produce, but are they better able to purchase our manufactured products than when they were getting a dollar or more for wheat? Examine it closely. All experience has been against the policies that were advocated; therefore, like Lloyd George, we sometimes look a little askance on the advice of experts. Of course, I realize that to solve the unemployment problem entirely would call for some one who could perform a miracle.

On top of this comes the immense problem of Russia. I know that in manufacturing circles there are those who disagree with their colleagues respecting the recent Russian trade offers, and the same is true in labor circles. Probably there are many who will not agree with me, but I believe the statements which I intend to, make are in harmony with the general policies of the labor movement, and in the interests of the progress of this country. No one occupying a position such as mine, would either desire or dare to say anything which would rob an individual of the possibility of a job of any permanent value; therefore when I say that I cannot agree that there is any permanent good for the workers of this country in the acceptance of present Russian offers I do, so with a full sense of my responsibility, knowing the hard feeling it may arouse in the minds of those who see the possibility of an immediate job were those offers accepted.

In 1920 I was appointed to a small Commission under the aegis of the International Labor Office to go into Russia to find out conditions, but the Soviet would not permit such an investigation. However" I have kept closely in contact with official reports of much that has been occurring there, and have had the responsibility of facing the attempts that Russia has been making for ten years or more, through its communistic agencies, to destroy the trade union movement of this country. Russia has been trying to destroy all that we have done in order that chaos might prevail and that in the midst of chaos they might impose their form of dictatorship. In resisting their attempts we have learned a little about the unreliability of their promises, the subtlety of their movement, and how they will use any and all circumstances to exploit their own aims and ultimate objects. (Applause.) Their political agitation has failed in most countries of the world. They have spent money freely to bring about sufficient political agitation to force acceptance of their conditions. Now, either by accident or design, they have come to the conclusion that it may be easier to accomplish their objects through their economic arm, and we are asked to assist them build their machinery as rapidly as possible so that they may do that harm at the earliest possible moment. I am not interested in, how the Russians govern themselves except in wishing to see the people of any country improve their conditions; but when they try to impose their civilization on us, then I have a right to resist if I value our civilization. (Applause.) I have no right to make declarations as to state policy; that is for the elected representatives of this country. Neither am I interested in the political fortunes of any party in this country. I believe that the Russian question is so important as to be above politics in Canada. (Applause.) I do not underestimate the ability of Russia to carry out some of her purposes, and I recognize that there may be countries who consider it to their advantage to do certain things we are not prepared to do; however I have confidence that in Canada we have sufficient natural resources, and sufficient intelligence in the masses of the people-who are at least fifty years ahead of the Russian population as a whole in social and other developments-to compete with Russia, to mould our own civilization, and to exist in the face of either Russia or anyone else. (Applause). For a long period this country adopted the policy of burying its head in the sand, refusing to say anything about Russia. People were kept in ignorance of the great social, educational, industrial and agricultural developments there. Then came a sudden change" and we were flooded with an enormous amount of information. The Russians are adepts at psychology and have pushed their publicity to the full, knowing the timidity of private capital and the effect such propaganda would have on its stability. They have poured out all the propaganda possible, to try and make one believe that the world is going to change over night and that everything you own will have to be sacrificed; that we had better throw up our hands and accept whatever conditions they impose. The truth lies between these two extremes. Russia is making developments; but if those developments keep pace only with the demands of their population, there is no danger. If, however, we aid them so that their material development will grow ahead of the demands of their population, they will have surpluses with which to destroy our markets and create the chaos which they are anxious to bring about.

Leaving the political side for a moment, let us analyze the latest offers commercially. I notice that those who protest against the latest decision of our government are those whose profit and trade might be affected by that derision. Our government has not forbidden export to Russia" but they name certain articles which cannot be imported into Canada in payment of what has been exported. The Russian government will not allow you to export shoes into Russia, even though they can supply their people with only 0.87 pairs per year each. It is a fact that they are selling rubber lined shoes in Manchuria and a large smuggling business is being built up on the Manchurian border. Cattle are so scarce that meat can hardly be obtained, yet our packing houses cannot export meat into Russia. Clothing cannot be sent into Russia. They have decided what is to be admitted in accordance with their policy and have said, "You can only send into Russia those things that we need for producing purposes, and nothing for consuming purposes." The Canadian Government has taken the same course, and said, "You can only pay us such things as will not damage our efficiency and our business." (Applause.) There has been some wild talk of this leading to war. When France prevented the importation of Canadian wheat because of her national emergency was there any talk of war? Was it thought serious enough for that? When we decided against the marketing of New Zealand butter here was there any trouble? Then why this commotion because the Canadian Government has decided that certain things are not to be imported into Canada at the present time?

These are the bare facts, so far as the Russian offer appears at present. Now, what does Russia permit us to send her? Agricultural machinery? Yes, but wheat dropped enormously last year, largely due to the reparations to which I referred, and to the fact that Russians were dumping wheat on the British and other markets, to the extent that there was no sale for our Western wheat" anal the purchasing power of the Canadian West practically disappeared. The agricultural implement industry became slack, because they could not sell in the West. Now, to remedy that condition and restore trade and employment we are asked to ship more machinery to Russia so that they can increase their competition and make things even worse. Any extra business our manufacturers get through selling to Russia will be offset by the inability of our Western farmers to purchase their machinery. (Applause.) Much more might be mentioned about Russian trade; but I would say that Russia cannot supply the world any more than any other country has been able to. There will still be trade however successful Russia may be. There is nothing that breeds demand quicker than satisfaction of present demand. I suppose some of you may say, "We know that from experience with the labor movement in Canada, as soon as we satisfy one demand they have something else in view." (Laughter). As the Russians emerge from their present condition of semi-feudal oppression, their demands will quicken and will have to be satisfied to an increasing degree. Therefore, future trade with Russia can be put aside for the time being, and for the present we can concentrate on our immediate needs. Mr. Lehman told the Canadian Club in this City about a week ago that Russia was not fighting capitalism, but was building up state capitalism. From what I know and have read of the Russian situation I agree with him. The leaders in Russia hold up our Ontario Hydro project as an ideal for their own country. We have led the world in state capitalism in some respects. We have the Hydro system, of which we can be proud; we have the Canadian National Railways, which is second to none, either for efficiency, inventiveness, or progress in any direction. (Applause). We have the Montreal harbour, further from the sea than most harbours, but one of the most efficient and economic in the world, built as a state enterprise, not as a private enterprise. Have we reached the ultimate in this direction? If it is necessary to beat Russia by this weapon alone, if national interest demands us to proceed in this direction, we have the men, the natural resources, a new country, and great opportunities. All that is needed is determination to reform our system and remove any obstacles standing in the way.

The problems of unemployment, of destitution in old age, of long working hours which do not permit men to take part in civic life-these are some of the problems that have to be met. We can meet them, and can make conditions in Canada such that confidence will be reestablished and we will be able to improve to such an extent" that as Russia looks to our Hydro today as an ideal development, so fifteen years from now they and other countries will be looking to Canada as an ideal towards which to aim. (Continued applause).

Mr. C. L. Burton, in voicing the thanks of the Club to the speaker, said that Labor was to be congratulated in having such a man as Mr. Moore, who by his especial knowledge of their problems could guide the Labor forces in Canada.