Mr. Cranford ....Being a member of the
Finance Committee, I had no intention of speaking on this Economic Report as I had
given it
every consideration before endorsing it. But the
critics of this report have not even given the
Committee the credit of admitting that some
points of our report have been made by surmise
or even conjecture. One member has shouted,
"Let us be honest with ourselves — let us face the
brutal facts". I cannot help but accept that challenge, and will not forget it while
this Convention
lasts, as it rings in my ears day and night; not
because I am afraid of being charged with
dishonesty, but because I wonder if the people
who are listening in will take it in the same spirit
of why it was said as I do, and that it was nothing
more or less than playing politics; I am sure that
the person who shouted such words would not
attempt to accuse any member of the Finance
Committee of being dishonest.
Again, there has been thrown at the Committee the condition of the fisherman in certain
sections of the country. Certainly these critics do not
mean to try to say that the members of the
Finance Committee have no regard for the fishermen of this country, particularly myself
who has
been a fisherman all my lifetime and has met with
many reverses, perhaps more than any other than
in this country, as I have always tried to market
my own products. How well I remember 18 years
ago when I began shipping fresh salmon to the
Boston market on commission basis, salmon I
had caught and bought. The largest shipment for
that season had reached Boston on a Friday afternoon, too late for that day's consumption.
It was
the only salmon that my agent had for that day,
and would have fetched a fair price but for the
fact a Newfoundland firm had gone to a cold
storage and got two carloads of frozen salmon
and placed it on the market. Their salmon were
bid in and placed back in cold storage and mine
was sold at a loss, as the commission agent had
no cold storage facilities. I lost more than the
value of my whole season's catch. The commission agent could not understand the attitude
of
this experienced firm, to have salmon from the
cold storage on the market on a Friday afternoon.
Of course, I understood it thoroughly and so do
all my listeners. This did not discourage me as I
have been shipping salmon ever since.
So you see, fishermen are going to meet reverses through bad voyages and poor markets.
But
the point I want to make is this: the critics of the
Economic Report who bring in the misfortune of
our hard-working fishermen and throw it at the
writers of the report, are only doing it for the
purpose of political propaganda and playing
upon the misfortunes of our fishermen for their
own political ends. My sympathy goes out to
those fishermen who have toiled all season with
practically no returns; and only fishermen like
myself who have had the same experience know
the feeling of it. And I, as a fisherman, dare any
person to say that I have not used all my energy
and influence in the interest of the fishermen
while at this Convention. Many members have
heard me say that the only industry that should
have any protection, particularly customs tariff
protection, is the fishermen. Also I have said,
"Never mind the businessmen, protect the fishermen and workers of this country to
the extent of
having them support their families, and businessmen are duds if they cannot do business".
Mr. Chairman If no other member rises and
November 1947 NATIONAL CONVENTION 777
occupies the floor, I will assume that they or he
as the case may be, are not interested in expressing any further views on the Economic
Report.
Mr. Smallwood That is not quite the case. Parliamentary practice provides that when a man
moves a resolution he is entitled to make two
speeches, when he moves it, and when he closes
the debate. After he has closed the debate no one
else may speak. In committee of the whole that is
not the rule. No one has the right to close the
debate in committee of the whole. He may be
lucky enough to be the last speaker, but no one
has the right to be the last.
Mr. Higgins You have actually given your
ruling on that, Mr. Chairman. You said if no one
else proposed to speak, you assumed the debate
to be closed.
Mr. Chairman It is time I made my position
clear on the matter. The debate will be presumed
to be tentatively closed by virtue of the fact that
if no member occupies the floor, I must assume
no member is interested at this moment in addressing himself any further on the Economic
Report. In view of the fact that it has been found
that the introduction of Mr. Howell might very
well result in some new evidence coming before
the committee, and in view of the fact that a
motion to adopt would be deferred from day to
day until it has been determined when and if Mr.
Howell is appearing before the committee of the
whole, I am afraid, Mr. Smallwood, that I intend
to call upon Major Cashin to conclude, or tentatively conclude, the debate on the
Economic
Report. I must assume a member is not interested
at this moment in addressing himself further if he
does not rise. I am not going to call members up
if they do not get up voluntarily. At this time it is
proposed to defer from day to day.
Mr. Higgins If Mr. Howell does not meet us,
this will be the final part of the debate?
Mr. Chairman I do not see what further matter
there will be to debate. Let us deal with the
present position before the Chair. The position is
tentative pending the determination as to whether
or not Mr. Howell is prepared to appear. If he
does not appear, I think you are justified in assuming for all practical purposes
that the speech
which Major Cashin will ultimately make in
reply may be fairly regarded as the final speech.
Mr. Smallwood It may be, but not necessarily
so. When Major Cashin finishes his speech, if any
member wishes to speak, he has a perfect right to
do so in committee of the whole. Speaking for
myself, I hope I will not feel like commenting on
Major Cashin's speech. I cannot guarantee that.
I have not heard his speech.
Mr. Chairman Let me remind you that if upon
the termination of Major Cashin's reply a motion
to adopt the report was placed before me, you
would have the right to speak to the motion, and
any member has a right to move that the question
be put without further debate and I would have to
put it.
Mr. Cashin Do I understand the situation now?
Before I go ahead, when I wind up this farce here
this afternoon, I can move that the committee
rise, report progress and ask leave to sit again and
that this report can be adopted or not adopted later
on?
Mr. Chairman If the motion made by you is to
the effect that the committee rise and report
progress, that is going to remain on the order
paper until disposed of, I presume pending the
hiatus between the termination of your speech
and the appearance of Mr. Howell....
Mr. Smallwood Neither Major Cashin or
anyone else has the right to wind up the debate.
He may be lucky enough. He has not the right.
Such right does not exist.
Mr. Chairman Let us not be too technical. If no
other member desires to speak to the report, and
Major Cashin has to reply to no end of questions
addressed to him, surely in calling upon Major
Cashin, I do so upon the fair assumption that no
other member desires to express himself further
at the moment. They can address themselves
when the report comes up for adoption.
Mr. Smallwood Yes, and also as long as the
house is in committee of the whole.
Mr. Chairman If Major Cashin, upon the conclusion of his speech, moves that the committee
rise, report progress and ask leave to sit again, I
am going to put that motion. If it is carried, I then
propose going back to the Chair.
Mr. Higgins The motion to put the question is
not debatable.
Mr. Chairman I am not under the impression
that this matter is of necessity finally disposed of
by Major Cashin's speech, if that is what you
mean.... In conformity with the rules I ask you to
778 NATIONAL CONVENTION November 1947
proceed, Major Cashin.
Mr. Cashin After some 12 days the debate on
this Economic Report has been concluded, and it
now remains with me to wind up the discussion
and to answer as best I possibly can the questions
which have been put through you, Mr. Chairman,
in order to clarify the whole situation. The
speeches of the delegates generally were of a high
order and showed that the various reports submitted to this Convention had received
their
closest attention. However, there were one or two
speeches which were devoted primarily to
destroying the basis on which the report was
compiled, and to generally paint a gloomy picture
of the country from every possible angle. Notably
was the speech of the delegate from Bonavista
Centre directed in this avenue. It reminded me of
speeches delivered by soap box orators in Times
Square in New York and in Hyde Park in London.
None of our critics whose object was to paint a
gloomy picture attempted to show any alternative, and in this respect it is proven
that there was
a deliberate attempt by a few delegates to tear
down the economic structure of the country, solely for the purpose of trying to advance
their own
fanatical cause.
Mr. Smallwood Point of order, "solely for the
purpose of trying to advance their own fanatical
cause". Major Cashin has no right to impute
motives to any member of this Convention.
Mr.Smallwood He did mention the member for
Bonavista Centre, and he was speaking generally.
Mr. Chairman I remind members of the rule - "No member is to use offensive language...." I
would suggest you refrain from personal references as far as possible, Major Cashin.
Mr. Cashin I must first deal, Mr. Chairman,
with the deliberate attempt to discredit the report
made by Mr. Smallwood particularly, and I now
refer to the question put to me by the junior
member from Grand Falls, Mr. MacDonald. This
particular question relates to our present liquid
assets in the form of cash and other securities. Mr.
Smallwood has been attempting to convey the
idea that the figures contained in our report
regarding this matter are false and untrue. The
same gentlemen made a similar attack on the
Finance Report and was forced later to withdraw
these attacks....
Mr. Smallwood Point of order. I withdrew nothing. Can Major Cashin show me where I
withdrew anything?
Mr. Cashin The figures as regards revenues and
expenditures contained in the Finance Report
were proved to be absolutely correct. In connection with this latest attempt to discredit
our report
and to try and show the country that the figures
have been cooked up, so to speak, Mr. Smallwood states that our estimate of cash surpluses
is
incorrect. I refer to the amount of $35 million
shown in the last paragraph on page 2 of the
Economic Report. I am referred to the budget
speech made by Mr. James on May 7, 1947. I do
not propose at this time to criticise Mr. James'
budget speech, but at the same time I am compelled to point out that this budget speech
does
not reveal the true situation of the country. Before
proceeding, let me point out that the Finance
Report was compiled on information received
from the various departments of government, but
particularly its statements of figures were compiled on information requested from
the Department of Finance; also on information given the
Convention by former Commissioner Wild over
one year ago. This Economic Report was compiled and presented to this assembly on
November 3, nearly seven months after the presentation
of the Financial Report. The figures in the
Economic Report were based on information
contained in the Finance Report, as well as information obtained since the presentation
of this
latter report. Now, what are the facts?
In Mr. James' budget speech delivered in May
last he stated that the total accumulated surplus,
as at March 31, 1947, amounted to $28,789,000.
Now, Mr. Chairman, if we take the revenue and
expenditures from April 1, 1947 to October 31,
1947, what do we find? We find that the total
revenues for this particular period amount to
$26,271,459, whilst the expenditures for the
same period amount to $23,492,591. This period
November 1947 NATIONAL CONVENTION 779
therefore shows a surplus of $2,771,868. These
two amounts now added together make a total
surplus of cash, as at October 31, of $31,560,868.
I said a moment ago that the budget speech of
Mr. James is anything but a complete picture of
the affairs of Newfoundland. Why did I make that
statement? For the simple reason that it is the
truth. From information received by the Finance
Committee, it will be observed that a sum of $3.5
million was loaned to the St. John's Housing
Corporation and other housing associations, and
which is consequently an asset. Today the St.
John's Housing Corporation and other housing
associations owe the treasury over $4 million;
$115,000 of this amount was a free grant;
$625,000 is a recoverable advance but bears no
annual interest charge, whilst over $3 million is
bearing interest at an annual rate of 3.5% and
debentures have been issued or are being issued
by the Housing Corporation to cover this amount.
In all, approximately $4 million. Mr. Chairman,
I consider this particular $4 million asset just as
good as our interest-free loans to Britain. I will
go further and say it is better. We have security
in this instance for our money and we unfortunately cannot say that with respect to
our interest-free loans to Britain. In addition to these
amounts, the Savings Bank shows an accumulated profit, together with its reserve,
of not less
than $800,000, and I refer delegates to the
Auditor General's Report of 1946, wherein it
states that $719,000 is to the credit of that surplus.
It is reasonable to expect that as at March 31,
1947 this had increased to $800,000. Then we
must take into account the amounts owed the
Department of Public Health and Welfare by the
United Kingdom government and also the
amount owed by the British government to the
Department of Public Utilities on account of the
operations of the Gander airport, as well as other
recoverable loans due the government for advances in connection with the development
of the
fisheries, together with the amount that would lie
to the credit of the Board of Liquor Control in the
bank, all four of which will exceed $1 million.
Now what is the result of this recapitulation? Is
it as follows:
*
This amount is exclusive of $3,232,000 which
lies to our credit with the Crown Agents in London for the purpose of redeeming two
loans coming due in 1950 and 1952. It is bearing interest at
present at 2 or 2.5%.
Again I must refer to Mr. James' budget
speech of May 7 last. He states that after taking
an amount of $3,232,000 from our interest-free
loans to Britain for the purpose of redeeming two
loans coming due in 1950 and 1952, that there
remains to the credit of our country in this particular respect, $7,868,000. I now
draw your attention to an answer to a question by the Finance
Committee on January 11 last as to how this
particular loan stood. The reply given by the
Secretary for Finance on January 15 last states:
the total amount of the advances made by way of
interest-free loans which were outstanding at
December 31, 1946, was $9,068,000 (London,
firm figure) and $242,000 (St. John's, approximation only) a total of $9,310,000.
If we
turn to the Finance Report we find that the total
amount of interest-free loans made to Britain
amounted to $12,300,000. We have told you that
$3,232,000 were taken from this amount and
placed in a special account with the Crown
Agents in London for the purpose of redeeming
two loans coming due in 1950 and 1952. This
should show a balance to our credit on account of
these loans of $9,068,000. The difference therefore between the two amounts is $1.8
million, and
this amount should be added to our surplus cash,
as it represents the purchase of war savings certificates by our people and these
certificates are
shown as part of our national debt. Therefore the
total cash surpluses, if we take this particular
amount into account, is over $39 million. This
amount has not been considered as a cash surplus
by the Department of Finance even though they
780 NATIONAL CONVENTION November 1947
show the war savings certificates as part of our
national debt.
If we turn to page 102 of the Finance Report
we find that our gross national debt amounts to
$83,993,047. The first amount of $3.5 million
coming due in 1950 and 1952 has been taken care
of by the deduction from our interest-free loans
of $3,232,000 which is invested at 2.5% and is
sufficient with accumulated interest to take care
of these two issues as they fall due. The second
amount the Dominions Office agreed to cancel
when the London delegation discussed Newfoundland affairs with the United Kingdom
representatives in May last. $1,600,000 or
$1,700,000 against our sterling indebtedness of
approximately $72 million. There is a sinking
fund of $8,342,000, which leaves this amount of
sterling debt at approximately $64.25 million.
Now our local debt in bond issues and war
savings certificates is approximately $7 million.
Against this latter amount there is a sinking fund
of $800,000, thus reducing our local debt to $6.25
million. If we add this we have a debt of $70.75
million. Against this we have cash and other
securities, including war savings certificates,
debentures from the St. John's Housing Corporation, advances paid on account of the
United
Kingdom government and loans to private corporations of an amount in round figures
of not
less than $39 million. If we deduct this amount
then from our total national debt we find that our
net national debt on October 1, 1947, amounted
to approximately $32 million.
This, Mr. Chairman, was practically the exact
position of the finances of Newfoundland on
October 1, 1947. These figures are critically correct. In our Economic Report we stated
that we
had $35 million approximately in liquid assets to
the credit of the country. The above statement
shows the assets accumulated since 1940-41, to
the amount of $39 million or possibly $40 million. The question of the advances to
the Housing
Corporation may be raised. Someone may say
they are not worth the paper they are written on.
That depression has been used in here before, but
even if you did take that into account — $4
million deducted from that — and give all the
people their houses for nothing, we still have $35
million left to the credit of the country.... When
Mr. Smallwood makes the statement that the
figures contained in the Financial Report and the
Economic Report are incorrect, he suggests the
dilemma of Tennyson's grandmother, which I
read about the other day in an English magazine,
and it says that a lie which is all a lie may be met
with and fought, but a lie which is part the truth
is a harder matter to fight.
Mr. Chairman, there is an adage to the effect
that fools rush in where angels fear to tread...
Mr. Cashin And this was strongly brought to
my mind. Now, Mr. Chairman, if we want to have
any kind of decency in this place...
Mr. Chairman And we are going to, and therefore I want to make it clear now that Major
Cashin is not going to be interrupted by any other
speaker unless and until he rises to a point of
order or a point of privilege.
Mr. Cashin I am not referring to that at all. I
have a very strong suspicion that the galleries
have been fixed up in the past two or three days.
Mr. Chairman I am not interested in the galleries. I am charged with the maintenance of
order here. If the galleries are biased and interfere
with me, I am going to have the galleries cleared.
Mr. Cashin This was brought to my mind
recently when I listened to the member from
Bonavista Centre go into his song and dance. He
is our prize jumper in the dark, and when someone throws the light of information
on him he is
usually up to his neck in a bog of misunderstanding. This is the subject of our finances,
and he
bites off more than he can chew on our sinking
fund. After listening to his hysterical oration I
wonder whether he had read our reports at all. If
he read the report he did not understand it, and
that would account for his not knowing what he
is talking about. I have to try and dispel some of
the fogs in which this delegate is wandering and
send him back on the road. I do this in the hope
that it will save me the trouble of doing it later
on.
Mr. Chairman, nearly a year ago I was informed by our finance department that the
total
of our interest-free loans amounted to $12.3 million. They were given, not at the
request of the
United Kingdom government, but out of the bigheartedness of the local Commissioners,
who
decided to be generous with other people's
money.... It is my firm conviction that it is doubt
November 1947 NATIONAL CONVENTION 781ful if ever a dollar will come back to us. The
government of the United Kingdom must think
we are a mighty generous country. This business
began in 1941-42, when the sum of $3.8 million
was passed over, free of interest, to Great Britain.
At the same time they had to raise a loan of $2.1
million from the United States to put our railway
in good shape for war purposes, on which we had
to pay 2½% annual interest. There's frenzied
finance for you, if ever there was. There's honest
handling of the people's money by trustees. We
shipped out of this country $4 million as an
interest-free loan, and then turn right around and
hang on our people's neck a debt which, up to
now, has cost them in annual interest nearly
$200,000.
Again in 1942-43 the trick was repeated.
Another burst of generosity at our expense, and
another $4 million leaves our shores. Again it is
interest free, and we are told without the United
Kingdom asking for the loan, and again our Commissioners go out and borrow this sum
from our
own people, $1.5 million at 3 1/2 % annual interest,
whilst our people invested some $400,000 in war
savings certificates. What can we say of this sort
of thing, this taking in two years almost $8 million and sending it right out of the
country? In the
first place we lost the interest we should be
making on it. We are losing this money just as if
it had been stolen from us. It is just as if our
treasury had been looted by thieves. What else
can I call it but large scale plunder? And if Mr.
Smallwood doesn't like that he can call it robbery, thievery, breach of trust or whatever
he
wishes.
Mr. Smallwood Mr. Chairman, I rise to a point
of order. I ask you, sir, quite seriously, is it in
order for a man to stand on the floor of this
Convention, admittedly covering himself with
veiled language, but nevertheless broadly to attribute thievery and plunder to the
government?
Can anyone do that with impunity? Is that in
order?
Mr. Chairman Not with impunity. I think that
as a matter of discretion Major Cashin is positively unwise, but if he cares to risk
the consequences
of his language, that is not a matter for me to
question.
Mr. Cashin In reply, I would like to know, and
I put it to you as a businessman, if you had
$100,000 and you were going to lend it to me
interest free, and then I go over to Mr. Hollett and
borrow another $100,000 and pay him interest on
it, that does not look like sense to me.
Mr. Chairman We might call it foolish, but we
could hardly call it plundering and robbing.
Mr. Chairman You can call it foolish and be on
the safe side.
Mr. Cashin Oh no, foolish people don't do
things like that!.... All we in Newfoundland know
is that we have been deprived of what should be
ours. Let us trace this claim. In 1943-44 still
another $25 million shipment went from our
treasury, and again it went without any interest.
What a wonderfully self-supporting country they
must have thought us! And again in that year, the
old trick of borrowing another $2 million at an
annual interest rate of 3%, to add another yoke to
the neck of our taxpayers. This year we did something extra, by way of a tilly, as
it were. Those
gentlemen who do business in the outports will
appreciate it better than I do — a man who buys
ten gallons of molasses figures he should get
another gallon for "tilly". We sent other monies
to redeem a loan which was not due for another
year, and thereby lost another $50,000 in interest.
The final spasm was in 1944-45 when the Commission sent out another $2 million to
Great
Britain under the usual interest-free conditions.
The total of this whole business shows that the
local agents of the government took $12 million
of our money and loaned it free of interest, whilst
at the same time they borrowed between $9-10
million. In short, whilst they went looking for
loans of $9 million on which they knew we had
to pay interest, they gave away $12 million free
of interest. Now if the member for Bonavista can
show you or me that such conduct was giving a
fair deal to this country, or that it was politically
honest, I will give him a gold medal with his
name engraved on it.
This sort of conduct on the part of an ordinary
individual in the capacity of a trustee of the
people's money would qualify him for a gaol or
a mental asylum. It can only be regarded as a
stripping of the people's treasury, no more and
no less, and the self-appointed champion from
Bonavista Centre will have to be a far better hand
with a whitewash brush than he is. It will take
more wind than he can summon, and that is not a
little, to remove the stench of this thing from the
782 NATIONAL CONVENTION November 1947
nostrils of our people. I estimate that if they had
loaned that $12 million at current rates of interest,
we should have earned nearly $2 million. On the
other hand, if we had not had to pay the interest
on the other $9 million we borrowed we should
have received another $2 million. Working on the
basis that a penny saved is a penny earned, this
country has lost $4 million. We have been told
that the United Kingdom did not ask us for these
loans, and that the Commission government gave
them as a voluntary gesture; but I do not think
that there is anybody in the sound of my voice so
gullible as to believe this. Behind it all can be
seen the guiding hand of the United Kingdom
government.
Now, Mr. Chairman, we come to the matter of
the sterling sinking fund. Mr. Smallwood admits
that he had been hearing me talk about this matter
for the past two years, and apparently he wants
to hear me talk about it again. It is such a novelty
to hear the member from Bonavista Centre say
that he wants to listen to somebody else, that I
think I should not lose the opportunity — I may
never get it again, and I mean that. To those of us
who can use ordinary intelligence, what I have to
say will be an old, old story. In 1933 an act was
passed which provided that beginning not later
than July 1, 1938, there would be paid into a
sinking fund for the redemption of our outstanding 3% sterling stock an amount equivalent
to 1%
of that stock, in this instance an amount
equivalent to £177,950. On July 1, 1938, the first
such payment was made. Each year this is paid
to the trustees of the fund, and the trustees go out
in the market and buy in the equivalent of this
amount to the principal of our debt. They have
been doing this for nearly ten years. Instead of
reducing the principal of our debt each year by
the amount of payment to the sinking fund, it is
left to itself, consequently we have been sending
over interest on interest. Therefore, if we compound these ten year payments at 3%
each year,
and allowing for the pound an average of $4.60,
we find that the fund as at July 1, 1947, should
total in the vicinity of $9.5 million.... I hold, Mr.
Chairman, that each year when this sinking fund
amounting to £177,950 is sent to England, and
the trustees purchase our 3% stock, that then the
national debt should be reduced by this amount
and the stock cancelled; but if we survey the
estimates of expenditure we find that no such
thing has been done, and our treasury has lost no
less than $1 million. I apologise to Mr.
Smallwood, when I said $1.75 million the other
day I spoke in the heat of argument, and I was
thinking of the interest-free loans as well. In other
words, it means that this country has been improperly and unlawfully deprived of the
amount
referred to, but I want it distinctly understood,
Mr. Chairman, that the implication that I accused
John Doe of the British Treasury of putting this
money into his pocket is, of course, ridiculous.
What I intended to convey was that through the
unbusinesslike methods of some person, the
treasury of Newfoundland has been deprived of
around $1 million.
No official statement has been furnished
regarding the handling of that particular fund,
although I have requested the same, neither has
Mr. Smallwood been able to give me this statement. He merely got an answer telling
him what
was happening. Also in the budget speech (last
May) no statement was given, and the only statement given was in the annual statement
of the
Auditor General. Why should we lose this $1
million? Are we so rich that we can afford to
overlook it, or are we so generous that we can
come out and defend it? That $1 million would
do a lot of good over where Mr. Bradley, Mr.
Smallwood and Mr. Burry so often shed their
crocodile tears. The position is that the people
who control our cash are $1 million short, so to
speak, in their bookkeeping. There may be a
satisfactory explanation, but in this case, until
they prove their innocence, I shall hold them
guilty of negligence.
[Short recess]
Mr. Cashin Reverting back to the interest-free
loans, there is another point which I should like
to bring to your attention. At the time we were in
London in May, there stood to the credit of this
country as interest-free loans to Great Britain
roundly $9 million. We discussed with Lord Addison the possibility of applying this
amount to
the reduction of our sterling debt. Lord Addison
made what I regard as a most astounding answer.
He told us that the Commission of Government
had recommended that these loans remain intact
and should not be used for this purpose. Now,
when these interest-free loans were given, the
pound sterling was valued at $4.45 and consequently Britain received pounds based
on that
November 1947 NATIONAL CONVENTION 783
figure. Today the pound sterling is valued at
$4.04, which is 10% less than the figure quoted.
If Britain had agreed to our suggestion, Newfoundland would stand to gain approximately
$900,000 and Britain would lose this amount
because of the dropping of exchange rates. In
addition, if the interest-free loans had to be applied to the reduction of our sterling
debt, our
treasury would have been relieved of paying interest accordingly, as well as the sinking
fund,
and thus an additional $400,000 annually would
have been saved. For the first year, approximately $1.25 million would accrue in saving.
Consequently, if we summarize the matters to which I
have referred, we find that in the case of the
interest-free loans, we would have saved $4 million. Secondly, in the case of the
sinking fund
another $1 million, and finally by the application
of the interest-free loans to the reduction of our
national debt, another $1.25 million. A grand
total, Mr. Chairman, which proper management
would have saved Newfoundland, and which we
would have to our credit today, of approximately
$6 million.
I think it is timely to refer to the much-discussed base deal. I regard this deal
as the most
far-reaching, and as far as we are concerned the
most deplorable of all the acts perpetrated in our
name by the Commission of Government. I refer
to the negotiations which they conducted with the
British and American governments, whereby the
sovereignty of Newfoundland territories was
given over to a foreign power under terms which
amount to an absolute assignment and forfeiture
of all our rights of ownership and administration
into and over these particular parts of our country.
We were never told then and we do not know
today, the circumstances and conditions under
which Newfoundland territory was placed under
a foreign flag. But those who come after us will
look upon this deal as the most shameful and
traitorous act which has ever stained the pages of
our history. For by that act there was taken, I
might almost say stolen from us, something so
priceless that other men and other nations have
not hesitated to defend it with the last drop of their
blood. It is a truly pathetic spectacle to read the
story of that time, when Mr. Emerson and Mr. J.
H. Penson, representing Newfoundland, were apparently ordered by Prime Minister Churchill
to
come to England and sign away our rights on an
agreement which had already been written. What
a tragedy that Newfoundland was not governed
by her own people. How different might the story
have been. What an opportunity there was here,
if in the interests of our common war effort this
national sacrifice was necessary, to obtain our
proper compensation!
I hold, Mr. Chairman, that if proper steps had
been taken at that time, the national debt of
Newfoundland would have been cancelled by
Great Britain, and Newfoundland would have
arranged and even demanded favourable trade
concessions for her fishery products from the
USA. But what happened? The United States was
given the strategic bases it required, and Great
Britain received material help in return for these
bases from the United States. Newfoundland
received nothing, unless we are to regard as a
favour the monies which Uncle Sam was compelled to spend here for the erection of
these
bases. But even in this case the benefits we reaped
were restricted ones, inasmuch as they were
restricted upon the direct or indirect instructions
of the Commission government, which advised
the American contractors not to pay Newfoundlanders the same rates of pay as those
paid
to either Canadians or Americans. The result of
this infamous measure was that it was not uncommon to find Newfoundland workmen doing
similar work, just as efficiently as the Canadian
or American workmen, but receiving in many
instances not more than half the wages of these
outsiders. Would the people of Newfoundland
have tolerated any such action under any of our
former governments, or would any of our former
governments so callously ignore the rights of
bare-armed labour?
Directing our attention to another phase of this
base deal, I have no hesitation in stating, Mr.
Chairman, that the Commission of Government
and the Dominions Office had no moral or constitutional right to alienate Newfoundland
territory to a foreign power. If we concede for one
moment that they could have justly performed
such an act, then we must also concede that they
could for the same reason have given away our
entire country to whomsoever they wished. Their
first duty was to protect our sovereignty. This
they did not do. And there is another feature in
this connection which is worth mentioning: the
British government, through its agents the local
784 NATIONAL CONVENTION November 1947
Commissioners, were legally and morally bound
under their own agreement to return this country
to the people intact when she became self-supporting. But as it is, she can never
give us back
our country as it was when she took it from our
control. It is no longer the Newfoundland of
1933. It is now a country with which we will be
forced to share ownership with Canada and the
United States. And so it is, Mr. Chairman, that a
foreign flag flies over our country today, and a
part of Newfoundland is no longer Newfoundland. Viewing the matter from a purely
financial angle, a survey of the situation shows
that because of the wage-cutting policy of the
Commission government, our Newfoundland
workmen were deprived of at least an additional
$20 million or $25 million in eamings....
There were several notes I took during the
debate in connection with the Economic Report
and on which I did not prepare any set speech. I
will try to the best of my ability to answer the
questions asked. The first one was asked by Mr.
Northcott. I was not here that afternoon, but I
understand it was how much gasoline comes into
Lewisporte, lands at Gander and on which no
duty is paid. I think it is 10-12 million gallons. If
we got one cent a gallon on it, it would mean
$120,000.
Mr. Burry asked what authority we had for the
forecasts regarding this development on the
Labrador. In reply, I would say we understand
there is a piece of legislation, which has received
its first or second reading, whereby a railway is
to be built by the Labrador Mining Company
from the St. Lawrence River right into this mine;
150 miles of this territory is Newfoundland's,
and the balance is Canadian. This piece of legislation is in the course of being adopted
or
negotiated with the Commission of Government.
In connection with this 350 miles of railway, if
my estimates are worth anything, it will cost that
company in docks, loading piers and rolling
stock, something around $100 million. I saw Mr.
Timmins, President of the Labrador Mining
Company, and he told me that this railway and
docks would cost in the vicinity of $65 million.
Half this railway is to be built in Newfoundland
territory and considerable labour will be given
our people.... Mr. Timmins would not be interested in speculating such vast amounts
of money
if he did not think there were some prospects of
returns. The development started in 1935 by Mr.
McKay, and it was later handed over to the Hollinger interests and Hanna interests
of Cleveland.
Prior to becoming interested in this development, these interests checked the reserves
of iron
ore in the Mesabi Range and I was told that from
their investigation they felt that high grade ore on
the Mesabi Range would be depleted within ten
years, consequently they were taking no chances.
Mr. Timmins told me that he felt that within ten
years ten million tons of iron ore would be
produced annually. The big steel mills in the
United States consume 100 million tons of ore
annually. When the Mesabi Range is closed out
there is only one place. The Labrador Company's
property is good. Everyone is optimistic about it,
and we find stock which went on the market at
$l is now selling up to $8 and $9. There must be
something to it. I have great faith in Labrador,
and I think it is our greatest potential asset. In
preparing this report in connection with Labrador
we were conservative. Within ten years Labrador
mineral deposits should be able to pay off the
national debt of Newfoundland.
In connection with the timber areas on the
Labrador, when we went into the Forestry
Report
[1] there was some question about the
amount of timber available for pulp and paper.
Mr. Burry was rather dubious as to the estimates
of 50 million cords on the Labrador. Finally we
brought in a supplementary report after we had
had an interview with the General Manager of
Bowaters, and in the Hamilton-Melville area
alone there was shown to be 25 million cords. I
realise timber in Labrador is difficult to transport
as navigation is open only four months a year; but
I am confident that within the next five or ten
years the forest areas of North America will
become depleted, even in Quebec. Then there
will be only one place to go, and that is Labrador.
That is why we discussed the possibility of a mill
on the southwest coast. I discussed that matter
with the General Manager of Bowaters — they
were not interested at the present time, but the
newsprint industry is now flourishing, they cannot meet the demand, they have contracts
signed
for the next ten years.... There is 150,000 horsepower in Bay D'Espoir which can be
developed
fairly reasonably. Consequently, we felt that in
November 1947 NATIONAL CONVENTION 785
the course of the next three or four years it is not
improbable that another paper mill would be
promoted and built on the southwest coast to be
fed with timber from Labrador. Some people
seem to think that the newsprint business is good,
but it is not going to stay that way. No one can
tell what is going to happen tonight.... Bowaters
have faith in the country; they have borrowed up
to $8-10 million to further develop that industry.
If they have faith, how could we give a pessimistic report on woods operations in
Labrador?
Mr. Burry....I did not challenge 50 million
cords; I did challenge the amount of 100 million
cords.... The question I asked was not in relation
to the great possibilities of the Labrador. I asked
what authority they had for saying that the Grand
Falls
[1] would be developed... What reason have
they for saying 1.5 million horsepower will be
developed, and that it will be used in connection
with Labrador and will be exported across the
border?
Mr. Cashin We got the survey from the files of
the Department of Natural Resources. The survey
was made by the Aluminum Company of Canada
in 1941. It was nearly developed in 1940-41, and
it was unfortunate it was not. When the
Aluminum Company at Arvida went down to
survey it, they were seriously contemplating it for
the production of aluminum and other products....
It was held under agreement with the Labrador
Mining Company. Undoubtedly an agreement
could have been made. I was told that by the
General Manager of the Royal Bank of Canada.
That is my authority. It may not all be developed
at once. When the mine is developed within ten
years, we are informed, it will produce 10 million
tons in ten years, probably more. They have to
have water-power to run the railway, they are not
going to run it on coal.... I think the Committee
felt justified in saying the water-power on the
Labrador would be developed.
Mr. Northcott wanted to know why the subsidy on the Gulf steamer was cancelled in
1930.
Newfoundland took over the railway in 1923; up
to that time the Reid Newfoundland Company
had been operating the railway, though the
government had been financing it from 1920 or
1921. Once the government took over the railway
officially, all subsidies were cancelled. I was a
member of the delegation which went to Ottawa
to try to negotiate a subsidy for the operation of
the boat on the Strait. We discussed it with members of the Mackenzie King cabinet
at that time
and they assured us that they were going to give
serious consideration to giving us a subsidy. We
pointed out that we felt we were justified, particularly in view of the fact that
then the private
companies operating on the Gulf had received
substantial subsidies from the Canadian government. I am not in a position to say
how much it
was.
Mr. Smallwood Was that really the reason? One
was a company and the other a government.
Governments don't charge governments anything.
Mr. Cashin I don't believe that, Mr. Chairman,
because they generally soak each other every
opportunity they get. Now, my friend Mr.
Smallwood and I have got to disagree again in
connection with this mercantile marine.... The
Amulree Report recommended that we should
have a merchant marine, since we were shipping
a lot of money out of the country annually. Now
how much money does go out of the country on
freights, etc.? Today we must have a gross business of some $70 million in and out,
and I figure
that at least 10% of that is freight.... That means
$7 million a year in freight. How much of that
goes out of the country today? Today we have
nine or ten Clarenville ships which cost a lot of
money, and now they are employing a lot of men
from Newfoundland. We have two freighters, the
Random and the
Rockfield Park. They employ
about 50 Newfoundlanders between the two of
them, and the other ships have ten men each.
That's only 140 seamen in the mercantile marine,
apart from small ships that are operated by some
local mercantile firms in the city who, I am glad
to say, are going into the business further.... Our
suggestion of a mercantile marine is one of the
best things in our Economic Report because,
apart from the employment it will give, it will
keep money in our country and keep our seamen
employed. I am prepared to back a mercantile
marine tomorrow if we had the necessary funds
to do so, and I feel that we should have a mercantile marine. If a private outfit
wants to buy it let
them buy it, or let the government guarantee the
money and take a mortgage on the ship, or establish one of their own under a Crown
company.
786 NATIONAL CONVENTION November 1947
The government bought two ships during the
war, and if you look up the records of the railway
department you will find that they paid about
$700,000 for these two ships, and that they made
a profit of over $1 million during the war....
I am going to refer shortly to our national debt.
In my remarks this afternoon I stated that the
national debt should have been cancelled when
the base deal was put through. That is my own
personal opinion. Why should I make that statement? These people who are operating
the
government were trustees and they have no right
to give away our territory without some compensation, and they should have at least
cancelled the
sterling debt.... I am confident that if Newfoundland was governed by a government
of its
own, one of the first steps could be to negotiate
with the British government as to the reduction
of that sterling debt. Why? War debts all over this
world have been cancelled. $45 million of that
money was spent during the war from 1914-18,
that is to date what it has cost Newfoundland.
Well, if all other countries cancelled war debts
we are just as much entitled to cancel them as
anyone else, and I am compelled to state that if I
was ever in a government of Newfoundland, one
of the first things I would do would be to start
negotiations with the British government for the
cancellation of that debt.
There is one more matter, Mr. Chairman, and
that is the matter brought up by my friend the
Rev. Mr. Burry the other day, about this Labrador
Development Company that's going out of business at the present time. I know something
of the
struggles the promoter of that company has had
during the past 12-14 months trying to keep it
afloat, trying to get sterling converted in dollars,
that's been the great difficulty. He has 10-12,000
cords of pit props which are required, mind you,
on the other side.... This company was prepared
to put up £50,000 in London and to cash it, so to
speak, out here for $200,000, and the government
would not do that. What is the result? The business closes down. The further result,
the most
unfortunate of all, is that these poor unfortunate
people down there have got to be fed during the
winter at government expense. I contend that it is
criminal.... It means the loss of $300,000 this
winter just because the Commission of Government or the Dominions Office, or the British
Treasury refused to cash a cheque for £50,000
and give $200,000 worth out here and apply the
£50,000 over there to the reduction of our debt.
Mr. Cashin The government here agreed to do
it, and on the other side they said "no". Well, what
can you expect? I can't understand my friend Mr.
Smallwood disagreeing with me at times when I
make critical remarks about Dominions Office in
London, and the manner in which they handle our
financial affairs. A few days ago Mr. Bradley
took up the time of this House by over an hour. I
am sorry Mr. Bradley is not here. He is one of the
ablest speakers in this country. I have been a
member of this House with him, and a member
of the government with him, and I realise that he
is one of the outstanding public speakers of Newfoundland, and I am sorry he is sick....
He gave
us an instance of how easy it is, with a big brush
and lots of black paint, to smear an entire country.
He went scavenging back to our national ash
barrels for half a century, resurrecting the
decayed corpses of this country's misfortune, and
rattled the bones of past history before us. His
general motto seemed to be that if he could find
nothing bad to say, he would say nothing good
anyhow. I waited to hear him say something even
faintly optimistic, something with a promise of
hope, something that could be called constructive
or helpful, but I waited, and you waited, and the
country waited in vain. In presenting the
economic picture of this country we have been
accused of trying to lop off a few million dollars,
but Mr. Bradley goes further than this — he lops
off seven years as if they had never existed. Truly
an amazing performance. He spoke of the dole
days, just as if Newfoundland was the only
country which had known dole. He spoke of the
hard times of our people as if we were the only
people in the world who had known hard times.
He spoke of depression as if we were the only
ones to feel its bite. Now we all know the meaning of fair criticism, but anyone listening
to Mr.
Bradley could only receive the same impression
that I received, that I was not listening to a fair
critic and an impartial discussion of the economic
condition of this country, but to the voice of a
person who had painstakingly and exhaustively
and labouriously compiled what I regard as the
most depressing wail of pessimism and despair
which it has been my misfortune to hear in this
House for nearly a quarter of a century.
November 1947 NATIONAL CONVENTION 787
Take note of the fact that Mr. Bradley makes
no discrimination in the manner in which he
placed the responsibility for the evils of which he
complains. He conveniently combines the misdeeds of Commission government with those
of
our previous responsible government. Mr. Bradley made much of the fact that our present
prosperity is the result of war boom. He is apparently unable to see the real position,
which is
this: from an economic angle it does not matter a
tinker's curse why or how our prosperity began.
All we are concerned with are these two questions, first: do we enjoy favourable economic
conditions? and secondly: what are the probabilities in favour of their continuance?....
All this
talk of how they came about has nothing to do
with the case. Let us be done with such childish
quibbling.
There is another point in Mr. Bradley's speech
which I feel I cannot allow to pass. In drawing up
his picture of this country he has actually wiped
off the years from 1939 to 1947, with the idea of
showing how our economy would have looked
without the benefits of the war. Now I am going
to take a similar liberty, and remove another war
from our history.... I refer to the first world war,
1914-18. Now as the speaker has fancied it a good
idea to tie up war with finance in the years 1939-
47, let us apply the same measure to the first
world war, and see what effect it had on our
economic life. What do we find? We find that ...
this country would be the richer by some $45
million. I am speaking now from the wholly
economic standpoint, and would not dare to
presume to put any value on the priceless lives of
those who made the supreme sacrifice, and whose
maimed and crippled bodies are still with us,
some of whom are in this very chamber. I suggest
that the speaker put that in his calculations, and
he will find that the picture he sought to make is
not so favourable to his cause as he fondly hoped
it would be.
We have been accused of including guesswork and conjecture, but in the speech to which
I refer there has been more that's outright guessing than in our entire Economic Report.
I regard
as a prize instance of this the delegate's reference
to the United States bases. He takes it upon himself, without any authority whatever
to inform
us that the United States will give us nothing in
return for these bases. He tries to show that we
are entitled to nothing.
For myself, I can see as far through a stone
wall as Mr. Bradley, and I expressed my firm
belief that there is every reason to believe that we
will be able to make satisfactory arrangements
with the United States, provided we have the
proper form of government in this country. I
would remind Mr. Bradley of another interesting
event which took place in his 50 year period. I
refer to the Bond-Blaine treaty. At that time
America had no bases in Newfoundland. We had
nothing to give her by way of a quid pro quo, and
she was prepared to accept our product, she was
prepared to do business with us on favourable
terms, but what happened? Canada interfered,
she skilled the deal, she destroyed our high hopes.
I ask Mr. Bradley how this deal would have
compelled him to change his economic picture,
and what this country would have been like
today, praticularly for our fishermen in every
section of the country if this deal had not been
deliberately sabotaged by the interference of the
Canadian government.
This speech I regard as an effort by one who
is politically partisan. It is a demagogic appeal to
stir unrest and dissatisfaction among our
people.... Certainly we had bad times, but so had
all other countries. Canada was throwing out dole
money by the millions. The USA was doing the
same.... Is anyone so foolish as to think that we
can find a way of life to banish hard times? What
nonsense! Look at England today, look at all of
Europe.... In our case we should thank Almighty
God that things were no worse with us. We were
one of the most fortunate countries in the world
all things considered, and I am inclined to repeat
Mr. Bradley's words about marching to Zion.
There is no Zion in this fallen world, where man
must earn his bread by the sweat of his brow, and
do not expect me or Mr. Bradley or anyone else
to lead you to it.
Mr. Chairman, I believe I have dealt with the
several matters contained in this report which
seem to call for some additional information. But
before I go any further there is one matter that
was referred to me outside this House the other
day, which I think I should like to speak about. A
member of this Convention asked me to explain
something to the best of my ability about what
happened in 1932, or 1931 I think, in connection
with the gold standard. I have told it many times,
788 NATIONAL CONVENTION November 1947
and I am going to do the best I can to give him
that information. In 1931 I happened to be Minister of Finance in Newfoundland, unfortunately.
When our loans were turned down, and when we
cut everything to the bone, as I described it here
the other day, at the end of October, 1931, the
banks came to the government, asking us to go
off the gold standard. At that time our people had
some $24-25 million in gold, in money in the
banks, which they could take out on demand in
gold. We refused for two months. Finally we had
to go off. As an Executive Council member at that
time you will understand that I am not in a position to reveal anything of what happened.
Mr.
Bradley was a member at the same time. But here
is what did happen: when we eventually went off
the gold standard, gold was $20.67 an ounce. It
did not rise to a very great extent during the next
year, but when the last President Roosevelt took
over the administration of the affairs of the
United States in March 1933 ... he rose the price
of gold in order that the banks would be able to
issue more paper, and give more employment,
and gold went up to $35 an ounce. That meant
that if we had not gone off the gold standard, and
we had compelled the Canadian banks to bring
down that $25 million in gold to pay our
depositors, in 1930 or somewhere in that vicinity,
their money would be worth 80% more than it
was before. Now who made that money? Some
people think that the Canadian chartered banks
here made it. I hold that they did not. There was
a central bank established in Canada which controlled currency, and they took over
all the gold
and they, if anyone, made the money, not the
chartered banks; and I have no brief for the
chartered banks, because I hate to go into one of
them if I owe them a note or something, but I give
them credit they did not make all that money. I
think they got a commission, so to speak.... They
made the profit, but Newfoundland lost that
profit. Whoever's fault it is, it is done and we
can't undo it.... That is the story of the bank
people. I have not given it to you in full, Mr.
Reddy, because I am not in a position to do so.
Mr. Smallwood Mr. Chairman, would Major
Cashin explain how, when the government
brought in the act which put us off the gold
standard, it was not a mandatory act but merely
a permissive one, that would have enabled the
government to put us back on the gold standard
at any moment.
Mr. Cashin That's what happened. I went out
of the finance department shortly after that. We
went off the gold standard New Year's Eve,
about 12.30. It was really New Year's Day. We
were technically defaulting on December 31, and
before they would give us any money to pay our
interest, they put the gun to our head and told us
we had to go off the gold standard....
Mr. Chairman I think in fairness to yourself,
Major Cashin, you did point out the other day that
the banks of Canada had that money, and if you
insisted on their bringing down that $25 million
worth of gold to depositors they would have gone
broke.
Mr. Cashin The commercial houses owed the
banks a lot of money, and they did not know what
was going to happen — anything could happen.
I think you will admit, Mr. Chairman, that our
Committee had to give its findings to this Convention under anything but favourable
conditions. This report, instead of being treated in an
impartial manner as it should have been, and
regarded as the best efforts of the Committee
was subjected to vicious attack from the moment
it was laid on the table. From every conceivable
angle its critics attacked it, making it a political
football. They went through all its 45 pages,
looking for an uncrossed "t", or an undotted "i",
to furnish them with ammunition for their
denouncements. Mr. Chairman, when you
opened the debate you said all holds were fair,
and the critics came out and tore the report to
bits...
Mr. Chairman If you don't mind Mr. Cashin, I
hope you don't...
Mr Cashin I don't mind a bit. Those political
windjammers...
Mr. Chairman I made the order because I knew
that no holds were going to be barred.
Mr. Cashin Those political windjammers hit
below the belt, because they could not hit any
higher. They charged it with being a dishonest
report, but that has been cast back in their teeth.
Their efforts have been in vain, and now, after a
12 day barrage, when these critics have slung all
their mud and exhausted their bag of tricks, our
report has come through intact on all its fundamental points. It came through for
the same
reason that truth always comes through. It came
through because it was based on unassailable and
November 1947 NATIONAL CONVENTION 789
undeniable facts. It was the job of the Finance
Commmittee to ascertain the standing of our
country, and viewing the handicaps under which
they laboured, I think we have been reasonably
successful. We distorted no figures, we neither
enlarged or lessened the facts of things as we
found them, and we came to our conclusions
because there were no other conclusions at which
we could honestly arrive. As the report shows,
our ultimate findings were first that Newfoundland was self-supporting, and that finding
is still unchallenged — it is a proven fact. Our
second conclusion was that this report showed
that we would remain so in the foreseeable future.
No arguments have been produced to prove or
even indicate the contrary....
The impression has been created that the future of this country must necessarily be
limited to
the figures forecast in this report. For instance,
we allow for future revenues of approximately
$30 million per year. This does not mean that our
revenues may not far exceed this amount. And for
the same reason, the amounts which we have
estimated as available for old age pensions and
other social services may be far in excess of the
figures we have given. Indeed I would hazard
the guess that undreamed of prosperity awaits
this country. And why do I say this? Because of
something which is only briefly touched on in the
report, an asset which we have not included in our
estimate of revenue. I refer to Newfoundland-
Labrador.... I now make another forecast and it is
this: that if a Newfoundland government is ever
in a position to capitalise on our Labrador possession, she will in less than ten
years be, for her size
and population, the richest little country in the
world. But why have we not heard more about the
Labrador? Simply because it is not in the interests
of those who want to exploit our territory to
advertise the fact. They are keeping very quiet
about it all.
Mr. Chairman, I realise that the discussions on
this Economic Report have gone far over the time
we thought would be necessary. However, realising the circumstances under which this
report
was introduced and the varying political sentiments which are held by delegates, a
prolonged
and bitter debate was perhaps all that could be
expected. As chairman, I wish to extend my
sincere thanks to each individual member of our
Committee for his help and co-operation in the
compiling of the facts. Also do I thank the various
other committees for the valuable information
which their various reports made available to
us.... Our work is finished and it remains for the
delegates to accept our report or reject it.
I move that the committee rise, report progress and ask leave to sit again.
[The Convention recessed to 8pm.]
Mr. Chairman ....Mr. Hollett the other day requested certain information from the High Commissioner
of Canada. In conformity with that
request, a letter was addressed to the High Commissioner, to which the following reply
has been
received:
Capt. W. Gordon Warren, RA.,
Secretary of the National Convention,
Colonial Building,
St. John's, Nfld.
Dear Sir:
I wish to acknowledge receipt of your
letter of November 18 in which you advise
me that you have been requested by the
Chairman of the National Convention to enquire from us if it would be possible to
procure copies of the official publications set
out in Appendix XV of the Summary of
Proceedings of the talks between a Committee of the Canadian Cabinet and a delegation
from the Newfoundland National Convention. I have passed on this request to Ottawa
and shall keep you advised as soon as I
receive further information.
As we have on hand at this Office the
publications entitled "Canada From Sea To
Sea" and "Canada, 1947," I am taking the
liberty of sending to you 100 copies of the
former and 40 copies of the latter for the use
of the members of the National Convention.
Yours sincerely,
A.E.L. Cannon,
Official Secretary
Office of High Commissioner for Canada
Mr. Smallwood The next order of business is a
motion under the name of Mr. Bradley, as follows: "To move that the Convention resolve
itself
into a committee of the whole to consider and
discuss the proposals received on November 6
from the Right Honourable the Prime Minister of
Canada." Mr. Bradley, as most people know, is
suffering from a very bad cold and has handed
me this letter:
790 NATIONAL CONVENTION November 1947
St. John's,
November 20, 1947.
Dear Mr. Smallwood:
Due to my absence from the Convention,
I wish you to move the motion that is on the
order paper in my name, and to pilot the
debate in committee of the whole.
Sincerely,
F. Gordon Bradley.
I therefore move order No. 2 on the order paper.
Mr. Chairman The motion is that the Convention resolve itself into a committee of the whole
to consider and discuss the proposals received on
November 6 from the Right Honourable the
Prime Minister of Canada.
Mr. Higgins Before that motion is put, I would
like to make a few remarks. Two or three days
ago I suggested a private session to discuss the
manner in which this particular motion is to be
discussed. It was not thought fit by members at
that time that we should have a private session,
but that it should be discussed in public. Therefore I should like to have a full
discussion on how
it is proposed to give effect to this resolution. If
the Convention goes into committee of the
whole, how is it proposed that we discuss this
matter? Are we going to read through the Black
Books? I think we should have some definite plan
of action before we turn ourselves into a committee of the whole, and know where we
are going.
Probably you, sir, could give us some idea of how
we should be guided in the matter.
Mr. Chairman This is a procedural question
before the Chair. The advisability or otherwise of
proceeding with this matter by committee of the
whole is a procedural question which must be
decided by the Convention.... I think, however,
your request is quite reasonable. In view of the
fact that Mr. Bradley is sick, his request is that
Mr. Smallwood should pilot this matter though
committee of the whole; if you do not mind, Mr.
Smallwood, would you be good enough to enlighten us on how you think you should go
about
it?
Mr. Higgins The last part of Mr. Bradley's letter
is quite improper. It is a matter for the committee
to appoint its chairman. Mr. Bradley has nothing
to do with appointing him.
Mr. Chairman In my own limited experience
here, the Finance Report and the Economic
Report were piloted by a chairman not nominated
by this Convention. Therefore there is no departure from established precedent in
Mr.
Smallwood's presiding without a vote to that
effect from the Convention.
Mr. Chairman It is purely a procedural matter
which should have been dealt with, perhaps, by
the Steering Committee.... I am not prepared, not
having examined the documents, to express an
opinion as to the
modus operandi if and when the
Convention resolves itself into a committee of the
whole.
Mr. Smallwood What I had in mind was, first
of all, not to make any long speeches in committee of the whole; secondly, not to
read through
this communication from the Prime Minister of
Canada; thirdly, not to read through the Black
Books (that is, the report of the delegation). My
proposal was to do this: immediately upon going
into committee of the whole to read first, two or
three passages from the speech of the Prime
Minister of Canada opening our conference in
Ottawa; secondly, one or two passages from the
speech of Mr. Bradley in reply to the Prime
Minister, because these two speeches gave the
setting to the conference. Then, thirdly, I was
going to read the letter of the Prime Minister
contained in the Grey Book. Having done that, I
was going to read clause one of the communication of the basis of union, explain what
that clause
meant, and then sit down. If any member wishes
to direct questions at me, bearing on clause 1, I
would attempt to answer. If any member cared to
make comments on Clause 1, he would, of
course, be free to do so. Clause 1 having been
disposed of, I then proposed to read clause 2, with
some brief explanation of it, then sit down. Same
procedure, clause by clause; to refer to the Black
Books (the report of the delegation) only by way
of explaining any point that required explanation.
It seems to me that if we followed that procedure in a businesslike fashion, and tackled
this
communication clause by clause, consulting the
documents — the supporting papers, so to speak,
we should be able to get through this thing in
eight or ten days.
Mr. Fudge As I understand it, due to Mr.
Bradley's illness he is unable to appear and he
asks Mr. Smallwood to take over the piloting.
Does that mean that when Mr. Bradley is medi
November 1947 NATIONAL CONVENTION 791cally fit and able to come to this chamber, will he
carry on?
Mr. Chairman I think we better discount that
from our calculations. I have no knowledge of
Mr. Bradley's condition....
Mr. Hollett I think you know my attitude
regarding the whole confederation idea. I maintain we are not a competent body to
deal with it.
I always felt we had no authority to do it and I
still hold that. I suppose if I followed my conscience I would try to keep the thing
from coming
in here at all; but we did vote to send the delegation to Ottawa, and as a result
His Excellency has
chosen to send us some documents which he got
from Mr. King. I therefore think we are duty
bound to do something.... The point Mr. Higgins
raised is well taken. There were seven men on
that delegation and either one, of course, would
be eligible to take the chair. I have no objection
to Mr. Smallwood's taking the chair and piloting
it through. Would you tell me this, sir, are you not
in a similar position as the Speaker of the House
of Assembly in the position which you hold now?
Mr. Chairman No. If I were Speaker of the
House, I would not be occupying the committee
chair at all. There would be a chairman of committees to whom the thing in the ordinary
course
would go. I am in the paradoxical position of
having to leave the equivalent of the Speaker's
chair, take the chair of committee, come back and
report to myself; it is most unusual.
Mr. Hollett ....I would suggest in carrying out
Mr. Bradley's request, it would be quite in order
for you to appoint whom you please, and I would
say the logical person would be the person whom
Mr. Bradley suggests. To keep the record
straight, I think it is definitely up to you to make
the appointment.
Mr. Chairman I am not so sure about my position here.... There is nothing in our Standing
Orders which permits me to appoint a chairman.
I therefore hold our Standing Orders are silent on
that point. That being so, I must take refuge in the
rules of the House of Assembly of Newfoundland
which brings me to Rule 122: "in forming a
Committee of the Whole House, the Speaker
before leaving the Chair shall appoint a Chairman
to preside who shall maintain order in the Committee." That order presupposes the
appointment
of a chairman to preserve order in committee,
which I have been doing heretofore. Therefore
Rule 122 does not apply to the case in point,
namely the appointment of somebody to pilot the
business before the House which is different from
appointing a chairman for the purpose of maintaining order.
Mr. Chairman "The Speaker, before leaving
the Chair, shall appoint a Chairman to preside
who shall maintain order in the Committee", that
is to say, appoint a chairman of the committee for
the purpose of maintaining order. In the House of
Assembly a bill is piloted through, usually, by the
person who introduces it. Now, this Grey Book
was introduced here by me, or at my direction,
in conformity with directions I had received from
His Excellency the Govemor....
Mr. Hollett You introduced the documents;
these are the ones we are to discuss and I hold it
is your prerogative to appoint whom you please
to pilot it through. I want to be clearly understood
in this — I have no objection to Mr. Smallwood's
being appointed, but I would like to see it done
right.
Mr. Higgins I would suggest we decide whether
we will go into committee of the whole first, then
you will have a motion from the floor, and I can
assure you it will not be embarrassing. Before we
go on, there is one other point I would like to
discuss. All the members here, with some apprehension and with just cause, are wondering
how long the debate will continue. Is it possible,
if we go into committee of the whole, that a
motion under section 48: "A motion may be made
during the proceedings of a Committee that the
Chairman do report to the Convention" —do you
view that as closing off the debate?
Mr. Chairman At any time a closure motion
may be made. A closure motion is without
debate. If it is deferred for any reason, it will be
the right of any member to move that the question
be put and I will have to put it. At any stage, it
would be open to any member to move a closure
motion, whereupon I would have to put the motion without debate.
Mr. Higgins Under Section 47, "when all matters have been considered the Chairman shall
report to the Convention." It is up to you to decide
when all the matters have been considered that
have been referred to the committee.
Mr. Chairman Let us take three positions. Suppose ... we get the motion to rise, report progress
792 NATIONAL CONVENTION November 1947
and ask leave to sit again. I report that back to the
Convention. If it goes to the other extreme, the
report is received or rejected, I report that back
to the Convention and I put it to the Convention
to accept or reject the decision of the committee
of the whole. Take the midway position of no
debate and debate ad infinitum; I get a closure
motion, I have to put that motion.... A closure
motion is non-debatable. If I receive that at any
time, I have to put it.
Mr. Chairman That is my ruling as far as a
closure motion is concerned.... I have to put any
motions received in committee to you.
Mr. Hickman The method outlined by Mr.
Smallwood for procedure was probably the best
way to tackle it. But I would like to be clear on
this. Mr. Smallwood said in going through it
clause by clause, we would go on from one to the
other. I would want to make sure there is nothing
to prevent a member from reverting back to a
previous clause at any time.
Mr. Chairman The context of any clause may
only be resolved perhaps in reference back to
other clauses. I can give you a definite assurance
on that.
Mr. MacDonald Coming back to this question
of appointing someone to pilot this through committee of the whole. We have a precedent
to
follow. Major Cashin steered the Forestry
Committee's report through committee of the
whole. I know the Chairman of the Convention
did not appoint him.
Mr. Chairman Furthermore, even if it was the
practice to have the chairman of a committee
pilot it though the committee stage, I would rule
that it is not applicable here. For this reason, Mr.
Bradley was a member of that delegation by
virtue of the fact that he was Chairman of the
Convention.
Mr. Chairman Therefore, the moment he
resigned his office, he lost his right to appoint
anyone. The more I go on, the more I become
convinced of the soundness of what Mr. Hollett
says; that it is going to devolve upon me to
appoint somebody to steer it through, if and when
you decide to go into committee of the whole.
Therefore, if the motion to go into committee of
the whole is accepted, then I think I will appoint
a person to do it. In view of the fact that Mr.
Bradley is absent, then I propose to appoint Mr.
Smallwood to pilot it through.
Mr. Hollett One other question I would like to
ask, there is going to be certain information
which we will require, to whom shall one direct
these questions? To you or to whom?
Mr. Chairman I think the questions should be
directed, in the first instance, to the person piloting it though. If you are not
satisfied with the
information supplied, because it lacks official
standing, then you should address your questions
to me....
Mr. Harrington Before you put the question, I
just want to say I associate myself with the
remarks made by Mr. Hollett earlier in the proceedings. When the House divided on
this question, on both occasions my name appeared in the
negative. I did not think we were competent to
deal with this matter as a Convention.
Mr. Chairman You are stopped now from commenting on the competency or otherwise of the
Convention, by virtue of the fact that you should
have determined it before you sent the delegation
to Ottawa....
Mr. Harrington I did not send them at any time.
I had nothing to do with it, first or last. Surely I
can say that. Now that we have the documents
before us, I suppose we have to make the best of
it.
Mr. Chairman If there was a division taken
twice, and you voted against it, your position is
already a matter of record, twice. In this particular instance, Mr. Smallwood, I will
appoint
you to take over, by virtue of the fact that you
were a member of that committee and in view of
the fact that Mr. Bradley is absent and has requested you to pilot it through....
Mr. Hollett Is that in view of Mr. Bradley's
absence, or is it for the duration? I take it, when
Mr. Bradley comes back, he will take over.
Mr. Chairman Mr. Smallwood's appointment
will be deemed to stand unless, upon his appearance in the House, Mr. Bradley is prepared
to assume the responsibility. Obviously I cannot
force on him the assumption of duties he may not
want to assume or may not be able to assume.
November 1947 NATIONAL CONVENTION 793
Mr. Smallwood As I said, I propose reading
first a few passages from the speech delivered by
the Prime Minister of Canada at the opening of
the sessions at Ottawa. That was on the morning
of June 25. The speech was broadcast throughout
Canada on all the networks, and the reply of Mr.
Bradley was broadcast that night.
[Mr. Smallwood then read extracts from the
speeches][1]
Now sir, I ask you to take the Grey Book. I
will read you the letter from the Prime Minister
to His Excellency the Governor....
[2]
Now, sir, I would ask you to turn to the next
page of the Grey Book
[3], this communication
from the Prime Minister of Canada, the title of it
is "Proposed Arrangements for The Entry of
Newfoundland Into Confederation". Clause 1:
1. Newfoundland will have, as from the date
of union, the status of a province of Canada
with all the rights, powers, privileges and
responsibilities of a province.
No, sir, I do not know the meaning of that
clause, it so happens. It is so utterly clear to me,
I do not need to explain it.
Mr. Higgins Mr. Smallwood said he would read
it and sit down.
Mr. Smallwood I said I would read it, make a
brief explanation and then sit down.
Mr. Higgins Mr. Smallwood said he would read
it and sit down.
Mr. Smallwood I guarantee you that what I said
was, "I will read it, make a brief explanation and
sit down." I have not made the brief explanation.
The explanation is this: from the time we would
become part of the Canadian union, we would
have the status of a province with all the rights,
powers and privileges and responsibilities of a
province. That means this: as I see it, Canada is
a union of countries called provinces — there are
nine of them. If we became a province, there
would be ten provinces. Canada is a union of
provinces or of countries. Each of these provinces
has its own legislature which it elects itself. That
House of Assembly or legislature governs the
province in all matters that are laid down for it to
govern it. The other matters are handled, of
course, by the government of the whole union,
that is the federal government. Turn to Vol. 1 of
the Black Books, page 81.
[4] You will find there a
description of provincial governments. Section
29:
29. Provincial governments in Canada have
various origins. Nova Scotia, New
Brunswick and Prince Edward island came
into Confederation with their pro-existing
constitutions practically unaltered by the
union. This was also the case with British
Columbia, although representative institutions were not fully developed there at the
time of union and were later regulated by
provincial statute. The Governments of Ontario and Quebec were provided for in the
British North America Act of 1867. The constitutions of Manitoba, Saskatchewan and
Alberta, which were created out of federal
territories, were laid down in the Manitoba
Act of 1870 and in the Alberta and Saskatchewan Act of 1905.
Mr. Higgins I understood this Black Book was
not going to be read.
Mr. Higgins We have "to consider and discuss
amongst ourselves". The matter I object to — I
agree with Mr. Smallwood's brief explanation — but a brief explanation does not
include reading
the Black Book.
Mr. Chairman I would like to clear this up. I
gathered that it was not your intention to refer to
the Black Books except as may be necessary to
794 NATIONAL CONVENTION November 1947
explain some clause which may be read. I understood you were to give a brief explanation
and sit
down; that questions would be addressed to you;
in the course of your replies, if and when it
became necessary, you would refer to the Black
Books as independent corroboration of the explanation you would give. If my interpretation
of
your remarks is correct, I think you are premature
in referring to the Black Books at this time.
Mr. Smallwood We are at clause 1 . In this document there are 23 clauses. We are at the shortest
one of them all. It might be very useful if we
determine in advance that very point. A clause is
given. An explanation of that clause is contained
in the Black Books — that is, the report brought
back by the delegation. There is no suggestion
that we take up those two thundering great
volumes, begin at the first page and read through
to the end.... The background of the Grey Book
is in the Black Book. The Black Book explains
the Grey Book. What is the use of telling the
people of Newfoundland that "Newfoundland
will have, as from the date of union, the status of
a province" if you do not explain what is the
status of a province?
Mr. Chairman Are you not anticipating the
position? If, as Mr. Higgins contends, the clause
is unambiguous and unequivocal, and is generally understood, then we must credit the
people
with at least as much intelligence as we have.
Mr. Smallwood As much intelligence, but with
as much information?
Mr. Chairman If the clause or any phrase of the
clause is ambiguous, then that will be a matter for
question; and in reply to any questions, then of
course you should be at liberty to then refer to the
Black Books. I think you should, in conformity
with the position as I understand it, and as I must
assume the House understands it, content yourself with reading the clause, then give
your explanation or interpretation of the clause. If any
questions arise out of that, or if your interpretation if questioned, then and only
then may you
refer to the Black Books.
Mr. Smallwood Does that mean that unless
some member of the Convention happens to ask
a question, the answer to which can only be found
in the Black Books, I may not refer to the Black
Books? In that case we might as well take these
and throw them out the window. Are the people
not to get the information in this report? This is a
report of the Ottawa delegation.
Mr. Chairman That is for members to decide.
If they want to get the information before the
people; if they have any doubt about the ability
of the people outside to understand any of these
documents or the nature or construction of any of
these clauses, then it is not only their right but it
is also their duty to make sure that they are
understood.
Mr. Smallwood Not to address a question to
myself, but to convey the information to the
people on the matter we are now debating. I am
an elected member.
Mr. Chairman You have the right to read the
clause, then you have the right to give an interpretation of the clause. If that brief
explanation is
not challenged, that is enough. You will be reading the clause; there may be cases
where you can
summarise your report and give your interpretation of it.
Mr. Smallwood There may be occasions when
I can summarise and other occasions when I will
have to read the actual words. May I say this? I
am eager to do only one thing, to have the people
of Newfoundland understand it; they are entitled
to that much.... They are the ones who have to
vote next spring. They have to understand it. Any
explanation that is going to enable them to understand it, surely they are entitled
to that explanation.
Mr. Chairman Then if this House, by a rule of
procedure, comes between the people and the
understanding to which you say they are entitled,
the responsibility is the Convention's, not mine.
Mr. Higgins The first clause of this document is
very clear.
Mr. Chairman To you, perhaps, Mr. Higgins;
but it may not be to others.
Mr. Higgins We have to give the people some
credit for having intelligence.
Mr. Chairman On the other hand, we cannot
assume they are all King's Counsel, like the
distinguished member for St. John's East.
[Applause from gallery]
Mr. Higgins Thank you for that remark. I might
November 1947 NATIONAL CONVENTION 795
say that there is an undue amount of applause, and
the applause is not altogether fitting.
Mr. Chairman We are labouring under a very
heavy strain here and it is anything but
humourous or funny. I would request you, please,
to refrain from any exhibition of satisfaction or
dissatisfaction with remarks expressed by any
member or by the Chair.
Mr. Hollett I am perturbed by the actions in that
gallery, so much so that I am suspicious about its
make-up. I want to ask, if these exhibitions are to
take place, has any member the right to ask that
the gallery be cleared?
Mr. Chairman As long as I am in this Chair, I
am going to maintain order, not only as far as
members are concerned, but also as far as the
public is concerned. I am going to maintain order,
if I have to send for the riot squad; and I will send
for them in a hurry. I want no more demonstrations from the gallery.
I do not want it to be unfairly alleged against me that I am coming between
the Convention and the people in the receipt of
information concerning the work of this
Convention. But I will have to remind you, Mr.
Smallwood, the manner in which information is
disseminated must depend, in the first instance,
according to the explanation given by you
yourself.... Let me also suggest that whether the
explanation as given by you is universally accepted
by the house, or whether it is taken from the Black
Books and accepted by the house, the fact is that
whichever modus
operandi is employed, the
country has the advantage of having you
read the clause and give an explanation. I do not
feel that reverting to the Black Books is necessary
to explain the context or meaning of any clause,
unless your interpretation of that clause
is challenged, in which event you could revert to
these books.
[Short recess]
Mr. Smallwood We are still at clause no. 1. I do
not know if any member has any questions or any
observations. I will wait a moment and, if not, we
will pass on to clause 2.
Mr. Penney We have not all got our books with
us. We did not expect this discussion of confederation tonight.
Mr. Hollett One question I would like to ask in
reference to speeches which were made by the
chairman of the delegation, and also the speech
of Mr. King. After stating that the matter is one
for the Newfoundland people to decide, Mr. King
goes on to say, "On the part of Canada, no final
decision would, of course, be taken without the
approval of Parliament". I would like to ask Mr.
Smallwood, what body makes the final decision
with regard to Newfoundland? In Canada no final
decision would, of course, be made without the
approval of Parliament, but assuming that the
people of Newfoundland vote for confederation
at the referendum, who makes the agreement
with the Government of Canada?
Mr. Smallwood Let me repeat the question, if I
may. "In the case of Canada, the decision to
receive Newfoundland as a province is made by
the elected Parliament of Canada. In the case of
Newfoundland, who makes the decision that
Newfoundland become a province?" The answer
is, the decision to have Newfoundland become a
province or not is a decision to be made, if it is
made at all, by the people of Newfoundland in the
referendum. I am sure Mr. Hollett will agree that
in Newfoundland we have various institutions —
magistrates' courts, Commission of Government,
National Convention, etc. Over and above all
these institutions are the people. They are
supreme and they are sovereign. You cannot go
higher than the people. In deciding what form of
government we shall have, they are the last word
of all. If anyone decides, the people of Newfoundland will decide that Newfoundland
shall
become a province, or Newfoundland shall not
become a province.
Mr. Hollett Mr. Smallwood has missed the
point. I am aware that the people of any country
are the people to decide the approved policy.
Assuming the people of Newfoundland decided
by referendum that they would like to go into
union with Canada under proper terms, I am
asking what body in Newfoundland ... would
approve any terms of agreement which may be
drawn up between the two countries?
Mr. Smallwood That is a very good question.
Let us look at it. If we were a self-governing
country, we have a House of Assembly, made up
of government and opposition...
Mr. Smallwood It is worth explaining. If we had
our own legislature, as we had up to 1934, the
position would be this: that to the King or to the
796 NATIONAL CONVENTION November 1947
Parliament of Great Britain, two joint addresses
would go. One from the Parliament of Canada,
and a joint address from the legislature of Newfoundland. These two addresses go to
the Parliament of Great Britain, praying that
Newfoundland be made a province of Canada.
Mr. Smallwood It is not common knowledge.
Most people have not read the BNA
[1] Act. The
British Parliament would pass an act making
Newfoundland a province. That would be an
amending act of theBNA. There is no parliament
in Newfoundland. Your question is, how would
Newfoundland be made a province if once the
people of Newfoundland decide in the referendum that this should be a province. How
would
it be brought about? I suggest to you there are a
number of possible ways.
Mr. Crummey Mr. Smallwood will remember
that that question was asked at one of the plenary
sessions, and the Chairman, Mr. St. Laurent, said
the Commission of Government would take the
necessary steps to effect union.
Mr. Smallwood I do not like to contradict Mr.
Crummey, but I am afraid I must. I do not like
repeating the statements made at the plenary sessions...
Mr. Crummey We went up there to get information, and the question is asked now and the
question has to be answered.
Mr. Chairman It seems to me your point is
properly taken, Mr. Crummey....
Mr. Hollett I would like to have my question
answered first.
Mr. Smallwood Commenting on that statement
of fact, it is still bearing on Mr. Hollett's question.
Mr. St. Laurent was asked by what procedure
could Newfoundland become a province. His
reply was that there were various ways, in his
opinion, in which it could be done. Commission
of Government might do it.
Mr. Crummey It was a straight question and a
straight answer in the plenary session.
Mr. Smallwood It is a record of memory and I
am not exactly defective in memory. I am supposed to have a good memory.
Mr. Chairman Mr. Hollett has addressed a
question to you and in the course of your reply,
Mr. Crummey raised a point of order and he took
exception to your stating that those plenary sessions should be regarded as private
or secret or
something of that sort. I ruled in Mr. Crummey's
favour; that disposes of that. We are reduced to
the position where I would like you to address
your reply to Mr. Hollett, forgetting the point of
order which Mr. Crummey raised.
Mr. Crummey I considered Mr. Smallwood
was going in a long circuitous route to answer Mr.
Hollett, and so I answered it.
Mr. Chairman I sustained you on your point.
With that in mind, Mr. Smallwood, would you
answer the question?
Mr. Smallwood Surely I am not to be put in the
position of being told how I am to answer a
question? Am I to be told I must state it in two or
three or 19 words? I must answer it in my own
way. I cannot get outside my own skin and become someone else. Getting back to Mr.
Hollett's
question. We have no legislature in Newfoundland, so the legislature of Newfoundland
cannot make a joint address to Britain. We have
not got a legislature, not an elected one. The
Commission is the legislature of Newfoundland
at the present time; they are both government and
legislature, filling both functions. That is one
way; to have the purely formal petition go to the
British Parliament; it would only be a formality
once the people have pronounced upon it in the
national referendum; all the rest is a mere formality, a mere technicality. The real
thing is what
the people want. If the people want confederation, one way is to follow the BNA Act
and say,
"All right, there is a legislature in Newfoundland
now". It was not elected, it is true. But it is the
legislature. No one is going to deny that...
Mr. Hollett Is this the answer, that the Commission of Government would do it? Remember that
the Commission is composed of four Englishmen
and three Newfoundlanders.
Mr. Smallwood It is not the ideal way, but it is
the legislature, though not an elected one.
Another way is this — take the parliament we
November 1947 NATIONAL CONVENTION 797
already have, not the one in Newfoundland, but
the one that governs us, that administrative
branch of the Parliament of Great Britain. Suppose the Parliament of Great Britain...
holds the
referendum in Newfoundland and the people
declare their choice, the British Parliament is the
one who receives the people's answer. If the
answer is, "We want confederation", the British
Parliament might well amend the BNA Act to
make us a province, provided always the Parliament of Canada also requested it. In
this way, the
British Parliament has two requests — from the
people of Newfoundland to make it a province;
and from the Parliament of Canada to make Newfoundland a province....
Mr. Chairman I might point out that the BNA
Act has already made provision, under section
49, for the entry of Newfoundland into confederation.
Mr. Smallwood In a specific way — the joint
addresses of the legislatures; but we have not got
a legislature. We have the position that if in the
referendum the people of Newfoundland say,
"We want confederation" the rest is a mere
technicality. I am not going to get excited over a
mere technicality. What I am excited over is how
the people will vote. The rest is mere formality.
It is perfectly constitutional.
Mr. Hollett Some people do not care whether it
is constitutional or not. But I also read the letter.
Mr. King emphatically stated, apart from one or
two matters like education, that this is the last
word as far as terms are concerned.
Mr. Hollett These are financial terms — that is
what concerns the country most. I also point out
there is a big discrepancy between the needs of
this country as a province and the actual receipts
from revenues. You made it out slightly over $1
million; I figured it out myself at $2 million. Mr.
King says, "This is the last word; we are afraid
we will not be able to do anything further". The
reason I asked the question as to who will
negotiate these financial terms is, I want to know
whether it will be the Newfoundland government
or the British government?
Mr. Smallwood Mr. Hollett has hopped from
the letter to some clause.
Mr. Hollett I do not hop, I jump. I am talking
about the letter. I want it understood that if in the
referendum a majority voted for confederation,
then you say it is a mere technicality — "We do
not care about technicalities" — a mere $2-3
million short on running the province, that is
nothing, the British Parliament has got that. I
want to bring that home.
Mr. Smallwood Reverting to the letter, the
Prime Minister says: "I feel I must emphasise that
as far as the financial aspects of the proposed
arrangements for union are concerned, the
Government of Canada believes that the arrangements go as far as the Government can
go under
the circumstances."
Mr. Hollett This is something more important
than mere money; it touches on matters of conscience.
With respect to those matters which are
primarily of provincial concern, such as
education, the Government of Canada would
not wish to set down any rigid conditions, and
it would be prepared to give reasonable consideration to suggestions for modification
or
addition.
When the government says these are financial
terms, they mean on the financial side, the money
side. On the conscience side, such as touches the
dearest beliefs of our people, you have no hard
and fast conditions. We can go back to the
Government of Canada and say to them, "We are
not quite happy over such and such a clause".
Mr. Smallwood Cable back; write back;
telegraph; or send a pigeon.
Mr. Hollett Would we not then be bargaining
with Canada? Have we the right to bargain? I
understand the delegation had no such authority.
Mr. Smallwood If an enquiry were sent tomorrow to the Prime Minister asking whether the
Government of Canada, in the event of union,
798 NATIONAL CONVENTION November 1947
would be prepared to change say, a certain clause
not dealing with finance, such as education, do
you think the government would not send back a
reply at once saying whether that was final or
whether they were prepared to change it? Would
that be bargaining? Would that be negotiating?
Mr. Hollett Another thing I would like to ask.
These speeches are very enlightening. We have
occasion to refer to them many times. On page
15,
[1] Mr. Bradley says, "We believe we possess
at least the basic possibilities of enduring
prosperity." I want to refer to that.
Mr. Smallwood That is distortion. You are not
reading the whole sentence. You are beginning
in the middle of something.
Mr. Hollett Mr. Chairman, would you tell me
where I have to start to read a sentence? "We
believe we possess at least the basic possibilities
of enduring prosperity; if once we come by the
type of government that will be a help rather than
a hindrance to sound development." I want to ask
Mr. Smallwood does he honestly believe we possess at least the basic possibilities
of enduring
prosperity?
Mr. Smallwood ....If it means anything, it
means this, a government that will give us free
trade, take off customs duties on things going into
basic industry, bring down cost of production and
bring down cost of living. That is what that
means. The kind of government that will give us
free trade and thereby help, not hinder sound
development.
Mr. Hollett I take it the Commission of Government which we have now, who in accordance
with the report of Mr. Howell about reduction of
duties are endeavouring to reduce taxes, they are
not the proper form of government?
Mr. Chairman That is a statement made by Mr.
Bradley, not by Mr. Smallwood. I do not know,
in fairness to Mr. Bradley, whether his alleged
antipathy towards Commission of Government
should be stated here. It is capable of almost any
construction.
Mr. Hollett Did I say anything about alleged
antipathy?
Mr. Chairman ....The tenor of your question
was whether Mr. Bradley regarded Commission
of Government a hindrance rather than a help.
Mr. Smallwood I certainly regard Commission
of Government as a hindrance in development.
They are not giving us free trade, they are still
keeping on duties. If you are referring to the
international multilateral trade agreements made
between 23 countries, they have fallen in line
with 22 other countries. You cannot credit the
Commission government with that.
Mr. Hollett Could you tell us a form of government which will give us free trade?
Mr. Smallwood Free trade with one other unit
of the world? You can have free trade with all the
nations of the earth — you can have it with the
United States, if you became part of it; you can
have it with Canada, if you become part of it; you
can have it with Great Britain, if you become part
of it. Read the whole paragraph. We are distorting
this paragraph. We are lifting a bit out of it and
debating that bit. The paragraph reads:
In the 42,000 square miles of Newfoundland herself, and the 110,000 square
miles of our Labrador, we believe we possess
very great possibilities of development and
expansion along industrial lines. We have
lacked the capital and the adequate population — and here I am thinking of numbers
— to develop our natural resources to anything
more than a token of what we believe they
might be. We believe we possess at least the
basic possibilities of enduring prosperity, if
once we come by the type of government that
will be a help rather than a hindrance to sound
development. We are wondering frankly
whether confederation is that type of government. We are here, with your sympathetic
and understanding co-operation, to see if it
is. Our fellow countrymen in Newfoundland
are following our movements with very deep
interest.
[2]
Mr. Hollett "We have lacked the capital and the
adequate population". I would ask Mr.
November 1947 NATIONAL CONVENTION 799
Smallwood by what means we could go about
increasing the population of this country?
Mr. Smallwood I could give you an answer, but
it might lead to bloodshed. Maybe the answer is
in section 3 of the Grey Book, family allowances.
I will drop the matter right now.
Mr. Hollett Perhaps that is good advice for
some of us to take.
Mr. Miller When we were discussing what
body would eventually approve the terms of
agreement, if Newfoundland were to enter into
confederation, Mr. Crummey gave an opinion.
He was present at the meeting.
Mr. Chairman He quoted Mr. St. Laurent. He
did not give an opinion.
Mr. Miller The thing is not cleared up. There is
a disagreement between Mr. Crummey and Mr.
Smallwood. We are in a disarming position, we
cannot get an agreement between two members
of the delegation. It is a matter of indifference to
me who is right.
Mr. Chairman Are you asking me to make a
decision on a matter in connection with which no
records were kept?
Mr. Miller I was wondering if Mr. Smallwood
would concede to Mr. Crummey, and say that Mr.
Crummey was right.
Mr. Crummey I was the one who asked the
question, and I asked how to go about it and Mr.
St. Laurent said that Commission of Government
was the government today, and we will have to
proceed through them; they would have to go to
the Commission of Government and dicker with
them.
Mr. Miller Anything that may follow may be
ill-founded.
Mr. Chairman There is a disagreement. You
must not draw conclusions, Mr. Miller, as to what
may happen tomorrow or the next day.
Mr. Hollett As I see it, Mr. Crummey must be
right, because Mr. St. Laurent sent these terms to
the Commission of Government. Mr. St. Laurent
or Mr. King sent them to the Commission of
Government.
Mr. Chairman They
were addressed to His Excellency the
Governor. I remind you that under the Letters
Patent, His Excellency occupies two offices — one as
the King's representative, and the other as Chairman
of the Commission of Government. They were addressed
to the Governor of Newfoundland.
Mr. Smallwood Clause 2:
[1] "The Province of
Newfoundland will include the territory of
Labrador defined by the award of the Judicial
Committee of the Privy Council in 1927 as Newfoundland territory." This Convention
knows and
this country knows that Labrador was awarded,
defined, laid down and declared in 1927 by the
Judicial Committee of the Privy Council to be
Newfoundland territory. This clause says that
that territory defined, described by the Privy
Council as Newfoundland territory shall be included "The Province of Newfoundland
shall
include..."
Mr. Hollett No, it does not say that. It says
"will" not "shall". Two different words. "Shall"
is mandatory; "will" is not.
Mr. Chairman I have to uphold you in this
connection. The proper expression to be used is
"will", as the expression "shall" implies that the
Canadian administration would order Newfoundland-Labrador to be a part of the Newfoundland
province. In point of fact, it is...
Mr. Smallwood To resolve any doubt. To make
the position beyond all doubt.
Mr. Smallwood It has everything to do with it,
if we are a province. Remember this, these words,
if we became a province, would be enacted as a
law; and the word "will" would become "shall".
Mr. Smallwood It is not a law until it becomes
a law. That can be done by the Parliament of
Great Britain.
Mr. Chairman It is merely a proposal. This is
not a legislation.
Mr. Hollett Mr. Smallwood kept repeating the
word "shall".
800 NATIONAL CONVENTION November 1947
Mr. Smallwood Newfoundland owns Labrador. What Labrador does Newfoundland own?
The Labrador defined by the Judicial Committee
of the Privy Council in 1927. There is another
part of Labrador on the other side of that boundary, which does not belong to Newfoundland.
This clause 2 says if Newfoundland becomes a
province, the Newfoundland part will still be
Newfoundland-Labrador.... The boundary laid
down in 1927 can be changed only with our
consent.... That boundary can never be changed,
except with the consent of the legislature of Newfoundland. If the legislature should
be foolish
enough to do what they tried to do a few years
ago, try to sell for a paltry $10 million, if the
legislature wanted to sell it; if they wanted to
change the boundary; they could allow the Parliament to do it. It is up to the legislature.
No one
else can do it.
Mr. Hollett That is a very good point which Mr.
Smallwood raises. He says the boundary is all
right; it is Newfoundland-Labrador, but it can be
changed with the consent of the Newfoundland
legislature — the provincial legislature.
Mr. Smallwood It can be changed now, without
confederation. The government can sell it.
Mr. Hollett That is what your provincial
government is going to do when we strike hard
times. Canada will come across and say, "Look
here, you are in a bad state. Let us see now, can
we make a deal over Labrador? We will take that
strip off. We will give you a loan to carry you
on." That is their intention.
Mr. Hollett They told you a lot of stuff. You do
not have to be told that.
Mr. Penney In connection with what Mr.
Smallwood says about Labrador, the Prime Minister of Quebec, Mr. Duplessis, thinks
very different from that. The Province of Quebec
controls the government of Ottawa.
Mr. Chairman That is not quite so. The
Province of Ontario and the Province of Quebec
supply the majority members to the Parliament
of Canada.
Mr. Smallwood Let us deal with that. Everyone
knows that Quebec would like to have Labrador.
We all know that.
Mr. Smallwood Mr. Duplessis says more than
his prayers. We know the Government of Quebec
and we know that Mr. Duplessis wants Labrador.
He is the Premier of Quebec. He is one of the nine
provincial premiers. That one premier would like
to have Labrador.
Mr. Penney Will you tell me who has the most
control in the government of Ottawa?
Mr. Smallwood Certainly. I am not trying to
dodge it. We all know the Government of Quebec
would like to have Labrador. So what? They were
never satisfied to lose it, but did by the law case
that was fought out in 1927 between Newfoundland and whom? Between Newfoundland
and Quebec? No! Between the Government of
Newfoundland and the Government of Canada.
Not the Government of Quebec. Where should
the boundary lie between Newfoundland and
Canada down in Labrador? That was the question
submitted to the Privy Council.... Quebec was
trying hard. They had a lawyer sitting in the court
with what they call a watching brief. Now, will
any member of the delegation who was present
in Ottawa substantiate what I am saying when
I say this: that Mr. St. Laurent told us as
categorically, as plainly, as certainly and as finally as words could make it, that
the Government
of Canada accepted the award of the Privy Council, and what in the name of goodness
else could
they do? Is the Government of Canada not going
to accept the award, the decision, the judgement,
the verdict of the Privy Council? Of course they
accept it, and they can do no other. Now I come
to your question. We know Quebec wants
Labrador. They were disgusted because they lost
it.... But, you say, Quebec controls the Government of Canada. Let us deal with that.
First of all,
I bring you back to section 3 of the BNA Act. Mr.
Penney knows the difference between government and Parliament: "The Parliament may,
with
the consent of any province, increase,
diminish..."
With the consent! The Parliament,
not the government. The Parliament includes the
Liberal party (who happen to have a majority in
the government); the Conservative party, the Social Credit party and the CCF. Four
political
parties make up the Parliament. The Parliament,
not the government could change the boundary,
and Parliament could do it only with the consent
of the Province of Newfoundland. That means
that Mr. Duplessis, if he should live long enough
and still be premier, when he is an old man, he
may still be roaring and bawling that he wants
November 1947 NATIONAL CONVENTION 801
Labrador; and if he likes he can shout it when he
dies, and if they open him up they will find
Labrador engraved on his heart. He has nothing
to do with it. It is the Parliament of Canada. The
Parliament of Canada is not the Government of
Canada.
Mr. Penney I am not convinced over that. The
Government of Canada is controlled by the
Liberal party and the Liberal party is governed by
the control of the Province of Quebec. It could be
upset in the next general election. It holds the key.
That is why I say there is something in what Mr.
Duplessis says about Labrador and the boundary
in particular.
Mr. Smallwood The Province of Quebec elects
65 members to the House of Commons. Ontario
elects 96. A good many more than the Province
of Quebec. Let me tell you something: there was
a time when Quebec was not as big as it is now.
At that same time, Ontario was not as big as it is
now. What happened?.... Quebec was pushed
north to the sea as far as she could go; Ontario
was pushed north to the ocean as far as it could
go. The last thing that can happen is that Quebec
can be made bigger, because Ontario controls the
government more than does Quebec. Quebec has
65 members whom she elects; Ontario has, I
think, 80-odd. Look in the Black Book and you
will find the number. If you say Quebec controls
the Parliament, why not say Ontario controls it
still more? Do you think Ontario is going to sit
by and allow Quebec to be made bigger? No. It
cannot be done.
Mr. Penney It has been proven those last years
that Quebec is Liberal and it is their province that
elected Mr. King and the government and kept
them in power, and Ontario, although just as big,
could not do anything to help her.
Mr. Smallwood That tells us a lot. That is a great
contribution to the debate. It is very enlightening.
Mr. Higgins tells us a lot. Now we know all about
it.
Mr. Higgins I understood reflections on any
person by any member was not to be tolerated.
Mr. Chairman I am afraid I must sustain Mr.
Higgins on this. Your words are offensive and I
ask you to withdraw them.
Mr. Hollett Would you tell us what is the
population of Quebec? What is the proportion of
people in Quebec in relation to the whole of
Canada? Please remember all these people in
Quebec want that Labrador.
Mr. Smallwood Can you answer for four million people? Have you canvassed them?
Mr. Hollett I have canvassed them as much as
you have canvassed the l00,000 voters in this
country. Probably you have canvassed them; you
were up there three months.
Mr. Smallwood The population of Ontario is
one million more than the Province of Quebec.
Mr. Hollett I do not want to know the population of Ontario.
Mr. Smallwood You would like to talk about
Quebec. The population of Canada is 12.5 million. The population of Quebec is of the
order of
four million. The population of Ontario...
Mr. Hollett I am not interested in Ontario.
When I ask a question, can I have the answer, not
a roving commission?
Mr. Chairman Mr. Hollett asked you, Mr.
Smallwood, the population of Quebec.... You
have not specifically answered his question.
Mr. Hollett Four million against the total
population of 12.5 million.
Mr. Smallwood If by that token, the four millions of Quebec can control Canada, by the same
token, more than four millions of Ontario can
more than control Canada. That follows, does it
not?
Mr. Hollett No. If Quebec went the other way,
the present government would be out and we
would have to get new terms.
Mr. Smallwood If Mr. Hollett is worried about
the chances of the Liberal government of Canada
falling, I would remind him that a matter of a
month ago the thing that held up the delivery of
this Grey Book was a by-election in a Conservative constituency where the Liberal
party won
with the most thumping majority in recent history
of Canada.
Mr. Hollett The Liberal government spent $1
million there in that election.
Mr. Smallwood I wonder if the Conservative
party told you what they had spent? I wonder how
you know the Liberal party spent $1 million in
that by-election? Did they tell you?
802 NATIONAL CONVENTION November 1947
Mr. Hollett I did not ask them. I was not in touch
with them.
Mr. Smallwood I am well aware that there will
be an effort made, in fact Mr. Penney practically
made it, to indicate that because the Province of
Quebec — one of the nine provinces — has 65
members in the House of Commons out of 245,
Quebec controls Canada; therefore if Quebec
wants Labrador she will get it.
Mr. Penney I said nothing like that. I said the
province controls the Liberal party at Ottawa.
Mr. Chairman What I understood him to say
was that the Liberal party supplied the balance of
power. Quebec held the balance of power.
Mr. Penney That is what I said and I do not want
Mr. Smallwood to put it in a different light.
Mr. Smallwood On that point, the suggestion is
being made, that the members elected from
Quebec ... would somehow or other persuade or
force the Parliament of Canada, which has 245
members in it, to force Newfoundland to give
Labrador to Quebec.
Mr. Smallwood The answer to that is this: I
admit there may be a revolution. Quebec may
raise an army and march into Labrador and be an
army of occupation and say to the Newfoundland
province, "Get us out if you can". They might do
that.
Mr. Smallwood They might do it in an illegal
way. They might — I do not suggest that will
happen. How can they do it in a peaceful way?
They have to bring into Parliament an act to
change the boundaries of the Province of Newfoundland....
[The committee rose and reported progress. The
other items on the order paper were deferred, and
the Convention adjourned]
