Our National Task

MR. J. H. BRACE, the President of the Club, presided, and addressed the gathering as follows:

Members of the Empire Club of Canada are very glad indeed to welcome today the members of the Canadian Chamber of Commerce and to have them join with us in this luncheon. The Canadian Chamber of Commerce has affiliated with it the various Boards of Trade of Canadian cities from Coast to Coast. This organization was conceived some ten years ago by one of the members of our Club, Mr. S. B. Gundy, who was its first president. Business representatives of various 'interests and various sections of the country are convened at this time in Toronto. While they represent various interests, they have a common goal, that which is to the best interests of Canada and of Canadians as a whole.

True, the past few years there has been considerable criticism of the management of business, both in Canada and elsewhere. No thinking man would place the responsibility for all the ills which this world has been going through in the past few years on the business men of our community. On the other hand, those men are quite prepared to accept their full share of responsibility. In the past they have pursued a somewhat inarticulate policy. I think that has been a mistake and there is a definite trend now for those (leaders in business to come forward and tell their problems to the public, so that the public will have the other side of the case as well as the one presented by other people within our community. In doing so, they will have a number of avenues through which they can present the casethrough the press, over the radio and by means of various public forums. The Empire Club of Canada has for years been the forum for common consideration of the members of the community, and I want to assure the Canadian Chamber of Commerce that we will welcome at any time members from that Chamber who are prepared to come and address this gathering on any subject that is of interest and value to the community and to the people of Canada.

I am very pleased at this time to introduce to you Mr. W. M. Birks, Past President of the Canadian Chamber of Commerce, who will introduce our guest speaker.

MR. W. M. BIRKS: Mr. President and Gentlemen It is indeed a pleasure to join in this function with the Empire Club. Is it not eminently suitable that Empire spirit should join with trade and commerce? It reminds me, it is not many months since in the Guild Hall of London I heard Mr. Stanley Baldwin say that the British Empire had been built not so much by the soldier, the sailor or the statesman as by the trading genius of the British race. It is a fine thing to be a citizen of Canada, but it is a finer thing to be a citizen of that most unique thing in history, the British Empire.

Before introducing our guest of honour, may I say that the Federation of Chambers of Commerce of the British Empire meets every three years alternately in London, the capital of the Empire and in one of the Dominions. It has met twice in Canada, twice in Australia, once in South Africa and is meeting this year for the first time, its 14th congress, in New Zealand. May I say that I hope Toronto in its Empire Club and its Board of Trade may be represented there. Gentlemen, you can leave Toronto on the 5th of September, and be in New Zealand in time for the opening of the congress on the 1st of October, and after a week's conference the remainder of the month we will be guests of that dominion, with free transportation on all the railroads in the north and south Islands, and we will be home by the 15th of December.

May I commend the suggestion to you. It will be a royal trip, and I would feel very badly if the Queen City was not represented.

Born in Toronto, where he lived until 1921, and then moving to Edmonton as one of our great newspaper editors of the Great West, Mr. John M. Imrie, has had his life divided between a great industrial centre of Eastern Canada and a great agricultural centre of Western Canada. I am sure to a Toronto audience of his native city, he needs no introduction. He will speak on the subject of "Our National Task." Mr. John M. Imrie!

MR. JOHN M. IMRIE: Mr. President, Mr. Toast Master and Gentlemen: It is indeed a privilege to address once again both the Empire Club of Canada and an annual convention of the Canadian Chamber of Commerce, this time on one and the same occasion. For the kindness of the invitation that has made that possible, I would like to express again my warm thanks to the presidents of both organizations and to their respective committees and members. I would like also to thank Mr. Birks for his very kind introduction.

It is of the Prairie West in particular that I have been asked to speak to you today. I would do so not in any sectional or partisan spirit but from the standpoint of broad national interest.

It is hardly necessary for me to remind you that in pre-depression days the purchasing power of the prosperous prairie area contributed substantially to industrial employment and general prosperity throughout Eastern Canada. That power was based largely on the creation of new wealth from the soil, chiefly in the form of wheat.

But as you know, with the world depression, wheat became for the moment a glut on world markets. The price for No, 1 Northern, to the farmers of my province, for example, dropped to an all-time low of 21c per bushel, less than one-fifth of the price in 1929. There were large concurrent reductions in the prices of Western livestock and other mixed farming products.

Premier Bracken of Manitoba estimated some little time ago that the curtailment of purchasing power of the Prairie provinces during the first four years of depression averaged $450,000,000 a year, a total for those four years of one billion, eight hundred million dollars. You know only too well how that contributed to idleness of industrial plants and unemployment of industrial workers throughout Eastern Canada.

It did much more than that. It contributed very definitely to the aggravation of our railway problem. For this I have no less an authority than he who was the guest speaker here yesterday, Sir Edward Beatty. I quote from his annual report to shareholders at the 1934 annual meeting, as follows

"In a very peculiar sense the prosperity of this country depends upon the prosperity of agriculture and therefore Western Canada, from which territory about 60 per cent of its freight earnings are normally derived from which territory-Western Canada - about 60 percent of its freight earnings are normally derived.

It is therefore a matter of very great national concern that recovery throughout Western Canada should be hastened in every possible and proper way. Unfortunately it is lagging somewhat behind recovery in the East; that always happens in depressions. This time, apart from that natural lag, it is being retarded by the adverse effects of several major mistakes in past development policies in the West. I propose that we should examine some of those mistakes today, frankly, dispassionately, as Canadians. Certain of them are of the West alone; certain of them are of Canada. For I would remind you that until five years ago the control of natural resources and of land settlement in the three prairie provinces was in the hands of the Federal Government and was exercised from Ottawa.

First and fundamental among these mistakes is that haphazard settlement, the scattering of 290,000 farm units over the vast stretch from southeastern Manitoba to the Peace River block in northern British Columbia -a stretch even as the crow flies of more than 1200 miles. With the hindsight which is usually clearer than foresight it 'is apparent now that if we had had in those early days orderly settlement with areas closer in being reasonably well filled before areas farther out were opened up to homestead entry, one Prairie province would have quite sufficed and enormous expenditures on railroads, other roads, government buildings, government itself, education and various other public services would have been avoided. Moreover with the wide spread and haphazard settlement - as part of it-and in the absence of soil testing and accurate knowledge of climatic conditions, availability of water, etc., tens of thousands of settlers were permitted to locate in those early years on sub-marginal lands where ultimate failure or at best precarious living was a certainty.

Secondly, there was the mistake of over extension of wheat production, of too big concentration on one unit of production. In the early days of Western settlement very great emphasis was placed upon wheat production in the West. That area was pictured as one of "easy money," where two or three crops of wheat would put a new settler on "easy street." Many farmers were attracted to the West from Eastern Canada and from other countries by the prospect of getting away from the hard work for twelve months in the year that they had been accustomed to as mixed farmers. Others again, having very little capital, sought to get established through the means of wheat as a cash crop, fully intending to diversify production later, but were gradually weaned from that intention by their observation of the relatively greater ease of wheat raising. That applied to many other settlers who had actually gone in for diversification, but seeing that their wheat-raising friends had a much easier life apparently than they, they too were weaned away from sounder methods of farming.

Then with the war there came patriotic appeals to grow more and still more wheat. During the four war years, 1915-18, the wheat acreage in Saskatchewan and Alberta was increased by almost 100%. It was during this period, this period of pressure as a war measure, that much of the sub-marginal lands were opened up for wheat raising. That and the personal grief and economic loss that has followed it, must be regarded as one of the economic tragedies of the war in Canada.

Co-incident with this and as a natural corollary of it, the unit of farm holding in the West was gradually extended until finally it became 388 acres as compared with 118 in Ontario and 128 in Quebec.

Regarding a third major mistake - an unwarranted increase in public and private debt - I need hardly say that that was not confined to the West. There it was a corollary of the two major mistakes already mentioned plus unwise ventures into railway and irrigation projects and very great extensions of social services.

A fourth mistake was the withholding of our wheat from world markets in 1929, with a view to forcing - one might as well be frank - higher prices, and the associated policy of cutting adrift from the established wheat trade selling agencies in Great Britain and elsewhere. That resulted in great losses to individual farmers, causing many to go more deeply into debt; it led to the estrangement of the established wheat selling trade of Europe; it helped to pile up a surplus of wheat it blinded our eyes to the fact that the world wheat supply was even then beginning to outrun the purchasing power for consumption at that time.

This brief citation of four major mistakes - I do not pretend that they are all - but this brief citation of four will help, I hope, to point the way to certain corrective measures.

One must surely be a very thorough and a very searching enquiry into the whole problem of sub-marginal lands and settlement thereon throughout the prairie provinces. Thus far we have more or less played with that problem. There is a tendency in some quarters to say, "Hush! Hush! There will be another series of wet years." But meanwhile in certain large areas characterized by those lands more than half of the occupied farms have been abandoned during the last six years and many of the remainder are being sustained only through lavish public expenditures on public relief. Meanwhile also a host of contradictory solutions are being suggested by various parties, and no one actually knows what the full solution is. Certain areas will have to be evacuated. But that is not the whole solution. Fortunately within the past few months a start has been made on such an investigation, and I earnestly hope that it will be made quickly and very thoroughly with the best of expert help that is obtainable, and that it will ascertain: - first, the actual conditions; second, the extent to which parts of those areas should be evacuated in the light of present world prices and the need therefore of minimum production cost and high production quality; third, the remedial measures that are sound and proper and workable financially; and fourth, what should be done with those settlers who must be moved to lands of greater promise, and how they are to be rehabilitated. This is a terrible problem, complicated and delicate, and I am most anxious that we will not go at it half-cocked, repeating the mistakes we have made in the past, but that first of all we should discover all its complications.

Secondly, there should be every possible encouragement to the present tendency towards a greater diversification of farm production on the prairies (or rather in those portions of the prairies that are suited for mixed farming) and to the full extent of available markets.

To that end the agreements presently in force with Great Britain are most helpful. They have permitted of an increase, since they became effective, of 800 per cent in the production of hogs in Canada. Even at that, our total production last year represented in bacon and hams only 45% of the quota guaranteed to us under that trade agreement. I earnestly hope that by 1937 we will have attained that quota, and that no reasonable effort will be spared to bring about a renewal of the agreement and the retention of at least the present quota. Similarly, the reciprocal agreement recently made with the United States is giving to the prairies a new outlet for cattle, and in that way is encouraging mixed farming. The principle that is represented in these two agreements should be extended as opportunity may be found, both to other mixed farming products 'in relation to the countries with which those two agreements exist, and also to other countries which are ready and able to use the products of Western mixed farming.

This further diversification of Western production will lead to a desirable and a necessary "thickening-up" of settlement in the better farming areas of the prairies. That in turn will tend to broaden the base for present public plant there - railways, government, roads, education, and other public services - and tend to give some easement in the carriage of debt burden.

Further "thickening-up" will come through the movement to such areas of those who public policy would find should be moved from the least promising of the submarginal lands.

But even that will not provide the necessary degree of "thickening up." So I urge again„ as I have repeatedly in the past, the colonization on small units for subsistence farming rather than farming for export, of many of our unemployed who have had previous farm experience or have a natural aptitude for farming. Obviously that will have other benefits, in lessening the burden of relief, in creating new tax payers, and in strengthening or restoring morale.

Even that will not be sufficient. Immigration is a rather unwelcome word in these days of unemployment, but I believe the time will soon be here when it will be considered both desirable and necessary to, institute a limited and restrictive form of immigration, with a view to locating on small farms in proven mixed farming areas, people with previous farming experience, who are in a position to locate there and become established either through their own means or in some cases through assistance that may be provided by their respective governments.

But there are large areas in the West that are not suited either by climatic conditions or by water supply for mixed farming. Moreover the local market there for its products is definitely limited. Therefore wheat will continue to be one of. the major items of production throughout the West. In view of the lowering of world wheat prices, it has become necessary for our Western farmers to strive hard for the greatest possible reduction in cost of producing wheat. Fortunately the world market for wheat is steadily, or gradually rather, brightening. Within recent months good progress has been made in removing antagonisms that were created in Great Britain and in Continental Europe, and there is some ground for anticipating a steady though slow improvement in the general wheat situation. In that connection, may I remind you that the greatest influx of land settlement the West has ever had in a like period was during the decade preceding the war, and in that decade "$1.00 at Fort William" was the veritable "pot of gold" at the end of the proverbial rainbow, something to be looked forward to but actually attained only in parts of the three years immediately preceding the war. Of course production costs were low then, but during the past five years many a farmer throughout the West has reduced those costs that are within his own control back to pre-war levels. Unfortunately he has to pay much more than those levels for most goods he has to buy. If he is to stay in wheat and be a consumer, at present and prospective world prices, every possible assistance must be given to him through a measure of further reduction in costs of what he has to buy, somewhat approaching the reduction he has made himself in those costs that are within his own control.

One word about the burden of debt. The "thickening up" that I have suggested will help somewhat to alleviate it, but that will be a glow process. Meanwhile I welcome most warmly the proposals the present Federal government has made for aid in refunding the debts of our Provinces with provisions for ear-marking of Federal subsidies and certain Provincial taxes, and with restrictions on future capital borrowings. I earnestly hope my own Province and the other two prairie Provinces will accept those proposals. They are right in line with what my own paper has been urging for the past two years or more.

Before passing to my last point, I would like to pay tribute to the spirit that has been manifest throughout this convention in all that affects the West, a splendid spirit, a spirit that is most promising, most encouraging. I take this opportunity of publicly thanking the business men of the other parts of Canada for the splendid way in which they have met the Prairie delegation.

During the very period in which the West was over-expanding its wheat production, the East was over-expanding its composite industrial plant. That is not true of certain individual industries: it is abundantly true of other industries and of the composite plant. Neither course was regarded at the time as a mistake. Throughout all Canada we took pride as Canadians in the fact that our export trade was being expanded to a point where we stood second among all the nations in exports per capita. But with the paralysis that developed in international trade, 'it became evident that we had over=extended ourselves, had failed to make due allowance for possible restrictions by other countries, and that this had been done industrially as well as agriculturally. As a result, there came from the industrial East demands for higher and still higher tariffs. Many advocated that there should be preserved for Canadian industry the entire domestic market. That point of view overlooked two things; first, that the prairie farmers can sell their products only to countries from which we are willing to buy in return; second, that prairie farmers having been forced to accept greatly reduced world prices, there is a limit upon what they can pay for that which enters into their cost of production.

May I recall to you for two minutes, that since the National policy was introduced in 1878, there have been great and far-reaching changes in the distribution of population, in channels and movements of internal trade, and in the geographical location of occupational interests. In 1878 more than 967o of Canada's total population was located east of the Great Lakes. It was very largely agricultural, only 1417o being located in cities, towns and villages. Macdonald introduced his national policy primarily as protection for farmers, to provide for them a home market, so that they would be no longer dependent upon foreign markets over whose fiscal policies they had no control.

That policy in principle, although not in degree, had an appeal alike to rural. and urban population of that time because the area of proposed industrial expansion had the same boundaries as the existing farm settlement.

How different is the situation today! The population west of the Great Lakes has increased from 150 thousand to approximately 3 million, from less than 4 % to approximately 30%. It has been engaged chiefly in agriculture and, as already stated, must sell the bulk of its products in other countries.

This brings me to a definition of our great national task, as I see it. It is to evolve a formula that will permit and promote the full and concurrent development of each of, the several parts of Canada without undue or disproportionate sacrifice on any other parts.

Those who know me will not expect me to present any cut and dried method; 'in fact, I am not interested so much in concrete details as I am in method of approach. If the method of approach is right, if it reflects the spirit of this convention during these four convention days, I have no doubt that we will be able gradually and in time to evolve that formula. (Applause.)

May I remind you that with every decade since Confederation it has become increasingly evident that this Dominion of ours is most fearfully and wonderfully made. That was true even as regards the original Confederation of the four Eastern Provinces. It has become very much more true of the Canada of today, with its far-flung stretch from Halifax to Victoria; with its three great natural barriers tending to divide our people into four widely separated groups; with its thinness of settlement from South to North; its great diversity of economic and occupational interest; its great public and private debt. Canada can not be governed on a basis of pure reason and pure economics. There must be at all times a readiness to take these varying factors into consideration, a readiness to recognize the inter-dependence of our various and distinctive parts, a willingness to give as well as to take. Above all, there must be kept in mind those great intangibles in our Canadian situation, those psychologies, those things of the spirit.

If all of this is done, there is no doubt, I repeat again, that we will be able to evolve that formula, and evolving it, we will be able to bring about that sense of greater national unity, that stronger vibrancy of national spirit that are the heart's desire of every true Canadian.

PRESIDENT J. H. BRACE: I am very glad whenever I see any evidence of anything which tends to bind Toronto and Montreal closer together. At our head table today we have a man I think in a very happy position: he is Montreal manager of the Bank of Toronto. He has been a personal friend of mine for some years. However, I have never tried him out by asking for too much extension of credit. Mr. James L. Carson, amongst many other things, is a very fine golfer, and while I should possibly not say it in the year 1936, he is still a bachelor. Recently he has been honoured by being elected President of the Montreal Board of Trade. I have very much pleasure in asking Mr. Carson to come before the microphone and extend the thanks of this audience to our guest speaker.

MR. JAMES L. CARSON: Mr. Chairman, Sir Henry, Ladies and Gentlemen: Having been the Montreal President of its Board of Trade for the matter of six days, it has been a great pleasure during the past three days to listen to the addresses given at our convention hall and at the gatherings so delightfully arranged by the various organizations of Toronto. These addresses have been given by leaders in our most important fields of endeavour, experts in the true sense of the word.

They tell a story of a certain factory having broken down and they had to call in an expert. The first thing he did when he came to the factory was to ask for a hammer. He started tapping. Inside of fifteen minutes he stopped and said: "There is your trouble." And it was. He went away and two days afterwards he sent in a bill for $250. Fortunately or unfortunately they had a Scotch book-keeper at the factory, and he thought he should ask for more details. The details came back

"To tapping with a hammer $l. "To knowing where to tap $249."

This Canadian Chamber of Commerce know where to tap. They have pointed out the weaknesses, and I think if the public will continue to hammer the proper way, with the great assistance of the press, we should have more efficiency in the conduct of our affairs, and there will be a greater opportunity for prosperity to follow.

Mr. Imrie is one of these Canadian Chamber of Commerce experts. He has been rendering outstanding service to Canada for a period of years. His reputation is equally as fine in the East as in the West, and it is my pleasure and privilege to extend to him on your behalf, most cordial thanks for his deeply informative and inspiring address.