The results of the seventh census of population in Canada, taken as of June 1, 1931, are comprised in 14 octavo volumes, of which all except the final volume of maps and graphs and certain monographs to be included in the two volumes of census monographs, have been issued. The present review is confined to the population census proper, including, however, the topics of gainful occupations, earnings, and unemployment; on the other hand, agriculture, merchandising and services, and institutions are omitted. In other words, the present review is limited to volumes I-VII, together with those monographs included in volumes XII and XIII which treat the topics of these seven volumes, so far as the monographs themselves have been issued. The advantage of considering the monographs in connection with the corresponding topics of the census itself is obvious, since the detailed analytical treatment of the former helps to throw into clear light the census findings and adds materially to the value of the results.

An outline of the contents of the several volumes may help to give perspective to the whole subject. Volume I contains, in addition to the administrative summary of the work of the census, a brief analysis and comment on each of the major subjects covered by the census, together with a selection of tables on all topics; the text covering 344 pages and the tables 1,177 pages. Volumes II-VII are devoted to tabular matter; volume II to population figures for local subdivisions, with details by sex, age, etc., for these areas; volume III to age classifications; volume IV to “cross classifications,” e.g. birthplace with racial origin, literacy, religion, etc.; volume V to wage-earners, earnings, families, and housing; volume VI to unemployment; and volume VII to occupation and industry.

The history of the British Admiralty, like that of the War Office, furnishes an exceptionally good opportunity for reviewing the relationship which exists between a Cabinet Minister and his subordinates. This relationship, of course, presents in all departments essentially the same general features, namely, the control of a specialized group of officials by one who, though ignorant in a technical sense, nevertheless possesses unusual competence in his own field of administration and politics. But in the fighting services parts of this picture are etched with deeper and darker lines. In the first place, there is obviously a greater disparity of talent between Minister and official than occurs in most departments, and the experts seem as a rule less able, or willing, to appreciate the political implications of the demands they are constantly making. The relationship is thus apt to be more difficult and occasionally more exacerbating; but it creates by that very fact a greater need for providing the department with a sympathetic spokesman and advocate in the Cabinet, while insisting at the same time on the absolute supremacy of the political power. In the second place, the pervasive influences of bureaucracy and departmentalism, on which the Minister must wage relentless war, occur in the fighting services in an acute and aggravated form. Officials in other departments may hold narrow and circumscribed views, but their counterparts at the War Office and the Admiralty will frequently add to those a complacent and unimaginative professionalism of their own; the fondness of a civil servant for unnecessary formalism may have a military or naval parallel in ponderous methods and obsolete techniques; bureaucratic prejudice may become red-tabbed or gold-braided intolerance; an esprit de corps may be transmuted into an un-discriminating loyalty to the ship, to the battalion, or to the service.

It is the purpose of this article to draw attention to, and to make an analysis of, a type of international movement of securities which has, especially in recent years, acquired considerable importance and significance, but concerning which there has been to date virtually no systematic or extended discussion. I refer to what has been called, in various balance-of-payments studies, the “international movement of outstanding securities.”

International movements of securities may take a variety of forms. Historically one of the most important types, and certainly the one most commonly referred to in the literature, has been the flotation of new (or refunding) security issues on foreign (or domestic) capital markets, and their purchase by foreign investors. Associated with this has been the repurchase of these issues by their issuers, either governmental or corporate, for sinking-fund or redemption purposes. A further type of securities movement, also of great historical importance, has resulted from the acquisition of a controlling interest in foreign corporations or real estate, or from the establishment abroad by a parent company of branches or subsidiaries. This category is generally known as “direct investments.” In this case, however, international transfers of securities are not always involved; whether they are or not will depend upon the particular method of financing adopted. The same is true with respect to the resale of direct investments abroad to foreigners. The reasons for the establishment or acquisition of subsidiaries abroad are well known and need not be gone into here.

Some seventy years ago, sixty-eight, to be exact, Walter Bagehot published a notable little volume entitled Physics and Politics, described in a subtitle as “Thoughts on the Application of the Principles of ‘Natural Selection’ and ‘Inheritance’ to Political Society.” Actually the volume sought to sketch in outline a natural history of political society, and to describe the process or processes by which later, more elaborate, and more liberal forms of association have emerged, from the dissolution of earlier, simpler, and more rigid, if not oppressive, forms.

Society, or at least political society, as Bagehot conceived it, is a kind of super-organism, having a social structure which is maintained by a social process. This structure is imbedded in and cemented by custom. Man is a custom-making animal. The process in this instance which is not otherwise defined, is what we know elsewhere as “the historical process.” Its function is to weave and reweave the web of custom and tradition in which the individuals who are destined to live together and eventually act together as a political unit, are ineluctably bound together.

Always there is a more or less inflexible tradition which imposes upon each new generation the pattern of the inherited social order. But always there are the liberating and individuating influences of other social processes—competition, conflict, and discussion—which represent what Bagehot describes as man's “propensity to variation,” or, to use a political rather than a biological term, his propensity for non-conformity, “which,” he adds, “is the principle of progress.”

In his latest volume, W. I. Jennings makes the comment that his researches into the working of parliament were much simpler than those he made into the operation of the cabinet. The reason for this he explains is that all the proceedings of parliament are a matter of record, whereas the cabinet proceeds in secrecy and works by stealth. On the face of it, this seems a very sound and perhaps a very obvious judgment. But I have to confess that I have found just the reverse to be the case in making a hasty review of war government. We have an immense amount of material about the working and procedure of parliamentary institutions in peace-time and comparatively little about the machinery of the cabinet; but in war-time, or at least in the last war, we have diminishing information about parliamentary activities and an ever increasing quantity of material about the cabinet operations. Take, for example, the nature and functioning of the British War Cabinet. In addition to the official reports, the proceedings of the Cabinet have been scrutinized and investigated by several noted authors. The subject of a war cabinet is a pet topic for administrative disquisition. Every text-book finds it proper to enlarge upon the experience of the last war and its consequences in administrative efficiency. But turn to the parliamentary side and you will find that the standard volumes are careful to omit all reference to war-time devices except in an incidental and apologetic manner. It seems to be axiomatic with the authorities that war-time parliamentary practices are so exceptional that they are not to be cited as precedents and are so irregular that they may be noted only as warnings of what is not good parliamentarianism. Of the innumerable volumes of memoirs, biographies, and autobiographies the centre of attention is directed almost exclusively to the working of the cabinet system, and little or no attention is devoted to the legislature's part in the matter. There are but half a dozen articles on war parliaments, and only one book is devoted to a somewhat specialized side of parliament and war. There are the volumes of Parliamentary debates, the Parliamentary Papers, and other documents, but these are much fewer than in peace, and it may be noted that when something of vital importance is to be discussed parliament resorts to its own brand of secrecy in the secret session. On the other hand, the cabinet, though its meetings are still somewhat secretive, proceeds in war to more careful recording of its doings; in fact, records seem to be of the essence of a war cabinet, and every member of the administration seems to desire to have himself on the record—posthumously at least—to a greater degree than the mere parliamentarian.

The Australian Loan Council is a unique body. Established in 1928-9 as a part of the Financial Agreement, after the opinion had become widespread that the credit of the whole of Australia, under existing conditions, could never be much higher than that of its weakest state, the Loan Council was given full legislative and constitutional status as the body which was to handle all borrowing by Commonwealth and state governments, except borrowing for temporary purposes or by the Commonwealth for purposes of defence. Against its decisions there is no appeal because the Council is not directly responsible to any one Parliament or electorate. “If,” as Mr. Forgan Smith of Queensland has complained, “any Premier agrees [at a meeting of the Loan Council] to a line of policy from which his State Parliament dissents, all that this Parliament can do is, by means of a vote of no confidence, to remove him from office. Nevertheless the decision of the Loan Council would stand.” It is more than probable that nobody foresaw the extent to which, in the depression, the Loan Council might “be made the instrument of forcing upon the Commonwealth and the States a common policy involving the very details of their internal administration.”

Reduction of deficits. The first evidence of the powers of the Loan Council came in April, 1931, when Australia was fumbling for a proper policy to stem depression. On the initiative of the Council the so-called Copland Committee was appointed and on the basis of the report of this Committee the “Premiers' plan” was drawn up, which aimed, through a variety of measures, at a prompt balancing of budgets. These were long steps forward, but the question as to what could be done to keep governments in line still had to be answered, and here again the Loan Council had an important role. Early in 1932 New South Wales defaulted on its debt, and then approached the Loan Council for additional authority to borrow.

To understand the effect of the war upon the Canadian economy it is first necessary to examine briefly the position of the country on the eve of the struggle. By the midsummer of 1913 Canada had come to the end of a long period of expansion and prosperity. For seventeen years the country had been engaged in the construction of the immense capital facilities which stimulated and resulted from the rapid settlement of the Prairie Provinces. The construction of transcontinental railways, the building of new cities and towns in Western Canada, the improvement of waterways and harbours, and the provision of machinery and equipment for nearly 200,000 new farms constituted an uniquely large proportion of the total economic activity of the country. In 1912-13, nearly one-fourth of all the labour and productive facilities of the economy was either directly or indirectly engaged in the production of capital goods. The employment of these resources could not, of course, be financed entirely out of the current savings of Canadians. Much of the money was borrowed abroad. About one-half of the total capital invested in Canada during the pre-war wheat boom came from foreign sources. In 1913 capital imports rose to more than $500 million, a figure equal to almost one-fourth of the national income. Such huge external borrowings could not be continued indefinitely. The money was obtained from abroad for the purpose of enlarging the export capacity of the country and it was necessary at some time to slow down expansion to enable the use of the facilities for the production of increased exports.

Comte, writing a century ago, claimed that in human affairs we were just entering the scientific stage. Already the physical sciences had made an auspicious beginning. They have made spectacular advances since Comte's pronouncement. Nevertheless, extensive areas in the physical sciences remain to be explored. Still wider areas in the domain of the social sciences await systematic investigation and precise analysis. The need for scientific advances as a means of meeting recurring crises in human affairs seems more necessary than in the days of Comte. It is quite evident today that we have greater sophistication, more extensive questioning, and a more marked social self-consciousness. The word scientific, widely and loosely used, seems to symbolize the temper of our age.

It has become fashionable in recent years to bemoan the manner in which the social sciences lag behind the physical sciences. Few, however, of those who deplore the slowness of scientific advance in man's knowledge of himself, have any concrete suggestions to make towards increasing the speed of that advance, nor are they clear as to whether the lag is necessary and inevitable, or accidental and removable. The common opinion appears to be that the causes of the lag are entirely, or at least mainly, historical, residing in the fact that while the physical sciences started earlier and have by now advanced further, the social sciences began later, and are still, therefore, lagging behind. This explanation is at least implied in the frequent urging by editors and politicians that the social sciences should hurry to catch up with the physical sciences, or alternatively, that the physical sciences should slow down and wait for the social sciences to overtake them. Viewing the matter thus, as a simple foot-race between physical science and social science, with the latter handicapped only by a slow start, is not altogether desirable, since it appears to ignore certain difficulties involved in a scientific approach to human behaviour, which, while not entirely absent in physicial science, are nevertheless easier to cope with when dealing with non-human material than when dealing with human subject-matter. It is with these difficulties that the present paper will be concerned.

The nature of these obstacles will perhaps be made a little clearer if we begin with a preliminary consideration of what a scientific sociology entails. There is no mystery about this. The programme for the new science was set forth clearly and in detail by the man who invented the word sociology, Auguste Comte.

The purpose of this paper is to survey the trends in the history of local government in Ontario which are gradually eliminating independence or self-government from municipal councils in Ontario. We are not here as much concerned with considering the desirability or otherwise of these trends as with recording the facts of the situation. Whether for better or for worse, the municipal councils in Ontario, as local self-governing units, have been, and are continuing to be, more and more restricted and circumscribed. They are becoming merely agents for other local units of government and for the central provincial government. The various aspects of this situation will be considered under the following headings, namely: (1) the establishment of subsidiary or auxiliary boards of varying degrees of independence; (2) imposition of obligatory and uncontrollable expenditure and the elimination of sources of revenue; (3) imposition of restrictions on control of municipal officials and employees; (4) the development of the Ontario Municipal Board; (5) establishment of the Department of Municipal Affairs; (6) municipal subsidies.

In general, the activities of a modern municipal government fall into two main classes-legislative and administrative. Of these, the first is of relatively minor importance. The second is essential to the everyday life of the individual, particularly of the urban dweller. As it is not possible, in the space available, to deal with all types of municipal government in the Province, this paper will be limited to a survey of the situation as it applies to the larger urban municipalities where the problem is most acute.

It is well recognized that the imposition of a tax on a commodity will produce certain changes in its production and consumption, and in particular, that the primary incidence of a commodity tax is a function of the elasticities of the relevant supply and revenue curves at the point of intersection. This study attempts to add to the precision, and to extend the usefulness, of the elasticity concept in economic theory, with particular reference to the taxing of commodities. The effect of commodity taxes in restricting business activity (and consumption) is of increasing economic significance. To facilitate the analysis of these effects, the term “Elasticity of the Market” is introduced. It measures the change in the quantity produced and sold, for a given vertical change in the supply curve, or in the revenue curve, or in both. Within the limits of the assumptions given, it is possible to determine from the elasticity of the market, the effect of a change in tax rates on the tax revenues, and the point of maximum fiscal revenue. The conditions of monopoly and competition offer a number of interesting comparisons, not only in the economic effects of commodity taxes, but also for general economic theory.

Dalton proposes that a commodity tax is divided between buyers and sellers in the ratio of the elasticity of supply to the elasticity of demand.

At the outbreak of war in August, 1914, plans to cope with a possible food scarcity in the Allied countries were of a rudimentary character. For example, in the War Book of the British Government, there was only one measure dealing directly with food, and that a measure for obtaining information. In France the only legislation on agriculture or foodstuffs existing at the outbreak of war was a law of the period of the Revolution, dating back to July, 1791, which authorized the fixing of retail prices for bread and meat. Hence, methods of procedure had to be improvised as difficulties arose and it was not until well on towards the close of hostilities that anything like a comprehensive food policy had been devised.

As the central foodstuff in the diet of the peoples of the western Allied powers, bread came to play a leading role in the development of food policy. In the words of the body that was later to dominate world import trade in wheat, bread was “the only diet which sufficed in isolation and was therefore, indispensable.” Other foods might fail or be in short supply, but starvation seemed a long way off so long as there was enough bread. In the United Kingdom an implicit “breadstuffs policy” underlay the whole structure of food policy. Though never expressed in any one document, that policy has been stated in these words: whatever else was allowed to be in short supply, whether for human or for animal consumption, there should be a sufficiency of breadstuffs to meet in full all demands for them without rationing. In the other European Allied countries the direction of policy is not so clear but, with surprising unanimity, efforts were directed to keeping bread cheap and plentiful.

Specialization is, without doubt, one of the most important factors in the development of modern science, since beyond a certain level of technicality it is possible, even with intensive application, only to master a limited sector of the total of human knowledge. But some modes of specialization are, at the same time, under certain circumstances, an impediment to the adequate treatment of some ranges of problems.

The principal reason for this limitation of the fruitfulness of at least some kinds of specialization lies in the fact that the specialized sciences involve a kind of abstraction. They constitute systematically organized bodies of knowledge, and their organization revolves about relatively definite and therefore limited conceptual schemes. They do not treat the concrete phenomena they study “in general” but only so far as they are directly relevant to the conceptual scheme which has become established in the science. In relation to certain limited ranges of problems and phenomena this is often adequate. But it is seldom, after such a conceptual scheme has become well worked out, that its abstractness does not sooner or later become a crucial source of difficulty in relation to some empirical problems. This is apt to be especially true on the peripheries of what has been the central field of interest of the science, in fields to which some of the broader implications of its conceptual scheme and its broader generalizations are applied, or in which the logically necessary premises of certain of these generalizations must be sought.

In Alberta, the Municipal Districts are the centre, or at least the most important units, of rural, local government. They possess a greater diversity of function than either school or hospital districts and, for the most part, they assume the task of collecting all local and provincial taxes on real property within their borders. An attempt will be made in the following pages to analyse their present position and to determine what adjustments are necessary to enable them to survive.

Historically, the Municipal Districts mark a comparatively recent stage in the evolution of Alberta's municipal units. They are the lineal descendants of the Statute Labor and Local Improvement Districts which were created while Alberta was a part of the North West Territories. There seems to have been no long struggle for local government, comparable to that which the people of Ontario waged for similar privileges at a much earlier date. The theory and practice of popular municipal government had been well established and accepted by senior governments before Alberta was settled. Hence the territorial, and later the provincial, government took the initiative in the formation of municipal institutions, and the comparative instability and sparseness of the population made possible a fairly strong central control.

The year 1912, seven years after the formation of the Province, is a landmark in Alberta's municipal history. A Department of Municipal Affairs was created to administer the various municipal acts and to furnish guidance and supervision to the local authorities. An arbitrary unit, a square of nine townships (324 square miles), was adopted as the physical basis of rural municipal organization. Provision was made for the establishment of Rural Municipalities with corporate powers. In addition to this “permanent” form of municipal government, provision was made for the formation of “small” and “large” Local Improvement Districts. The former were to possess elected councils with more restricted powers than those of the Rural Municipalities; the latter were to be directly administered by the Provincial Department of Municipal Affairs.

Dominion aids to Canadian wheat marketing extend back at least to the beginnings of the western wheat trade and have been of three traditional types, viz.: (1) regulation, (2) investigation, and (3) elevator operation on a limited scale. Regulation of the Canadian grain trade has long been of a quality unsurpassed in other grain producing countries and has evolved in recent decades through repeated revisions of the Canada Grain Act. Investigation dealing specifically with the western wheat trade has involved a notable series of royal commissions commencing with the present century. Elevator operation by the Dominion Government started in 1913 with experimentation and compromise as its objects, and the Dominion Government still retains substantial interests in interior and other terminal elevator plants. In addition to the customary federal aids to wheat marketing before 1929, mention should be made of the exceptional intervention accompanying the Board of Grain Supervisors, which marketed part of the 1916 wheat crop and the crops of 1917 and 1918, and the first Canadian Wheat Board, which marketed the crop of 1919.

Important as the above-mentioned aids have been in shaping the destiny of the Canadian grain trade, they form a striking contrast in simplicity compared with the interventions of the decade4 herein considered. Dominion regulation, investigation, and elevator operation have continued to the present time, but the notable innovations in Dominion activity after 1929 lie beyond the traditional categories and include more or less sustained sorties in attempted stabilization, in bonusing, in international consultation, and in various types of wheat board operation. Dominion aids to wheat marketing, of special significance from 1929 to 1939, may therefore be classified as follows: (1) stabilization activities, (2) bonus payments, (3) international consultation and agreement, (4) wheat board operations; and since several important federal investigations of the grain trade took place within the decade, there should be added (5) investigation. These topics have, for the most part, been analysed individually and at short range in various current writings, so that factual material may here be reduced to a minimum and the emphasis placed upon interpretation in perspective.

While the war lasts most decisions and policies can only be provisional. It has now become apparent that the view that the conflict had settled down into siege warfare, supported by the Allied blockade of Germany, has been belied by events. In the last war the long military stalemate in France gave the Allies time to organize their superior economic strength, and in the end this superiority tipped the scales. The economic strategy so far would seem to have been based upon the assumption of much the same kind of military development. If, however, the military situation is as critical as it appears to be, the economic strategy will have to alter. Our economic and financial measures are then likely to undergo a series of improvisations which will defy all attempts at precise calculations. Germany's blitzkrieg will certainly warrant new forms of economic mobilization in the United Kingdom, and probably in Canada too. In this situation careful attempts to minimize costs, involving a widespread reliance on private-initiative and the free pricing system, must and will be thrown overboard. And with them will go the framework and modes of thought of much of our traditional economic theory.

Discussion of the finance of war is also complicated by the fact that public finance—or the larger problem of war economics—is as much a problem of politics as it is of economics. And it is the political aspect of the subject which surrounds war finance with most of the controversy which it possesses. Whether a particular form of taxation, or the decision to do by government decree what is normally done by taxation, is desirable or not, turns more and more on the state of political sentiment, and less and less on questions of economic analysis. In this domain of politics the economist has no particular jurisdiction; and for the politician himself the condition of public opinion changes so rapidly during war that measures deemed impolitic today may be universally demanded tomorrow.

The purpose of this paper is to suggest the close relationship between economic development and movements of moral reform in Canada. From the beginning of Canadian history, organized attempts have been made to control such problems as intemperance, crime, gambling, juvenile delinquency, sexual promiscuity, and prostitution. These movements were indicative of a condition of disintegration of the mores, and their role was that of establishing a new moral code to govern behaviour. But disturbances which resulted in the breakdown of moral standards extended throughout the range of society, and affected the organization of economic and political life as well. Movements of moral reform, like those of an economic or political (or purely religious or cultural) character, were products of economic expansion.

This fact becomes evident if consideration is given to the broad features of the social development of Canada. Beginning with the establishment of the fishing industry in the Gulf of St. Lawrence, Canadian development may be represented in terms of a series of stages marked by the emergence of new areas or forms of economic exploitation. The expansion of economic life involved new accommodations in economic, political, and social institutions, and the points of greatest social disturbance were to be found where the impacts of the new techniques of production were most felt. It was within these interstitial areas of social organization, where the traditional culture came in conflict with new economic developments, that movements of reform took their rise.