Under the broad title of this paper I propose to deal with some legislative and administrative aspects of municipal government rather than the more political phases, although, of course, these matters cannot be definitely segregated. It is my intention to note some points in connection with the present structure of municipal government in this province, to raise certain problems for discussion—problems which are vital even if obvious—and to make some suggestions.

These matters have interested me for some time both because of an academic interest, and because of the experience of seven or eight years' active participation in municipal affairs. I have held municipal office—both by appointment and election—and I have learned much about what is and what is not possible in the political processes. But I hasten to add that I have also been defeated for municipal office and probably that has taught me the most. However, I will not labour these points here.

The first elementary point that I should like to make is the constitutional one that in this country the municipality is the creature of the province. Our constitution establishes only the federal and provincial governments, and such power as municipalities have is delegated by the province. This means that changes in municipal structure depend on no complicated constitutional negotiations or charter but simply upon the willingness of the legislature to make changes which are believed to be generally acceptable.

Rapid and continuous decline in the size of the human family has been widespread during the last half-century. The main facts are widely known. A brief summary will serve as an introduction to what follows.

In most European countries a period of continuous decline in the birth-rate began about 1870. In France the decline began much earlier, in eastern European countries somewhat later. We find the same picture, varying only in time of origin and tempo, in the United States of America, the British Dominions, Russia, and probably in Japan. A precise measure of the trend in terms of gross and net reproduction rates cannot be given over a long period, but the changes in these measures are available for several countries from 1911 to 1931. The drop in the gross reproduction rate in these twenty years was 50 per cent in Sweden, 38 per cent in Denmark, 37 per cent in England and Wales. In Australia it was 41 per cent between 1912 and 1933. Studies of smaller population units reveal the same trend. Among the counties of England and Wales, the smallest percentage decrease between 1911 and 1931 was 18 per cent. In Scotland a few counties showed smaller percentage decreases, the smallest being 11 per cent.

Recent publications have once more drawn the attention of the scientific world to the School of Lausanne. While economists emphasize chiefly the originality of the conception of economic equilibrium in Walras, sociologists and mathematicians pay homage to Pareto's versatile genius. Contemporary authors are mainly interested in the mathematical method and the conception of pure economics advanced by these two men. But the same authors forget too easily that Walras and Pareto dealt with numerous political and social questions, and that their opinions in these matters are important from the point of view of both applied economics and methodology. The object of this paper is to discuss these opinions. We shall first state the great philosophical antithesis which marks the division between the ideas expressed by Walras and Pareto, and secondly, consider the ideas themselves.

Although the works of Walras and Pareto on the subject of pure economics are complementary, their methods in dealing with practical economics are completely different. According to Walras, the duty of a politician is to apply the principles and data deduced by the pure economist. The pure economist must scientifically deduce laws from the “good old Natural Law.” Walras believes in scientific ideals and in the permanence of political laws; in philosophy, he is a Realist, in the sense given to this word by the quarrel of the Universals. In contrast with this, the conception of Pareto is much more flexible, much more pragmatic. His doctrine is that certain principles, rationally erroneous, can in practical reality be excellent, because people are usually governed by their feelings and not by their intelligence. To the great Italian, scientific laws were only “experimental uniformities.” This is the conception of the nominalist philosophy, which Pareto stresses when he writes: “Io sono il piu nominalista dei nominalisti.”

Municipal institutions in Canada date their origin to the 1837 rebellions in Lower and Upper Canada, the Report of Lord Durham on the causes of the rebellions, and the action of Lord Sydenham in putting through legislation creating municipal institutions. He did this in 1841 while he was, as he called himself, “dictator.” Under Sydenham's system municipal officers were largely nominated by the Crown. This was changed in 1845 in Lower Canada, and in 1849 in Upper Canada, and an elective system was set up. These acts are the foundations of the municipal systems of Ontario and Quebec.

The rebellions in Lower and Upper Canada were the product of identical political systems under which vast areas were governed from provincial capitals remote from the people. There was an accumulation of grievances without a corresponding opportunity for redress by change of local government. Sydenham put the situation in his despatch (no. 160) of September 16, 1840: “The people acquire no habits of self-dependence for the attainment of their own local objects … Whatever little improvement in their respective neighborhoods may appear to be neglected affords grounds for complaint against the Executive. All this is charged directly upon the Government and a host of discontented spirits are ever ready to excite their feelings.” It is not too much to say that the granting of municipal self-government took the word rebellion out of provincial history for one hundred years. This was an achievement of the first order. It is to be ranked in the science of politics with some of the great discoveries in medicine. As there is a cause for the rash which appears on the skin of the child, so there is a cause for those disturbances in the political body which evidence themselves in rebellion.

There is a popular impression that the contemporary family has lost that position of dominance which it held in the days of our forefathers. Many have come to regard the family as an institution with a great and historic past but with a dark and uncertain future. Meyer F. Nimkoff has assembled some of the evidence in support of this position. “Some students,” he writes, “think they see the eventual demise of the family in the growing restlessness of large numbers of people over the limitations of conventional family life.” He draws attention to the trend towards unconventional sex arrangements as revealed in recent studies of sexual phenomena, to changing public opinion as shown in the changed attitudes towards the family of representative modern novelists, to statements concerning the evolutionary supersession of the family made by scholars such as Müller-Lyer, to increase of childlessness, and to the possibilities of ectogenesis. Though of qualified significance, he might have cited statistics on divorce.

I would like to confine my remarks today to a review of the last six months, outlining many of the practical problems that have been solved and perhaps forecasting a few of the conditions that may be present in the months to come. Since December 1, 1941, when retail prices went under control there has been little, if any, change in the retail price of goods. The cost-of-living index released two or three weeks ago shows practically no change since October, 1941. Much credit for the success so far is due to the thousands of retailers from coast to coast who have been, with few exceptions, eager and anxious to obey the law and to do everything possible to help work out the difficult price adjustments that had to be made between retailer, wholesaler, and manufacturer. These adjustments were necessary owing to the general retail price level which at the time of the basic period, September 15 to October 11, was much below replacement cost.

The subject allotted to me was “Retail Business Under the Price Ceiling,” which I propose to deal with under three general headings: (1) some of the immediate problems that arose; (2) the effects of this legislation to date; (3) some problems we see ahead.

Let us keep in mind that price ceiling legislation is only one of several methods that the government is using to avoid inflation, and that all are interdependent to some degree. Constantly increasing taxation in all its forms, and borrowing, in war savings stamps, certificates, and bonds, is siphoning off some of the excess spending power. Industrial rationing and priorities have been in effect for some time. Subsidies to agriculture, importers, and primary producers are now being paid. But there are already grave doubts if even all of these controls are enough. Forced savings, direct rationing to consumers, and many other controls may be just around the corner.

It is well to remember, too, that price ceiling legislation is even now less than six months old. It is still in the heat of a distilling process. The outbreak of war in the East and the tremendous loss of supply occasioned thereby was, and still is, a severe jolt. That it has withstood this shock so well up to date is at least encouraging. That the United States has adopted the Canadian plan with very few changes is evidence that they consider our controls effective so far and had no better ideas to offer. It seems reasonable to expect that both countries working on the same plan will relieve some of our difficulties, and our services as the guinea pig of experimentation should be of some assistance to them. In any comparisons, however, that may be made between the two countries, it must be remembered that the United States's spiral of prices was much more rapid than ours and continued for a longer period. Their ceiling prices are, therefore, on a generally higher level in most commodities.

Experiences during other war and post-war periods indicate that there is a close relationship in the field of economics between what happens during the war and what comes after it. In no division of our national economy is that more evident than in agriculture. It seems appropriate, therefore, to begin a paper such as this with a discussion of what is happening now—with the problems that are being encountered as the war progresses. This will provide a background for the consideration of some questions that may arise in the period following the war. The discussion of these invites consideration of steps that might be taken to deal with them. Some references will therefore be made to the latter although the treatment will, of necessity, be sketchy.

Prices and Income. First among the matters of concern to farmers now is the question of prices and income. It is not a new problem. For some years prior to this war the prices of farm products had been low relative to the prices of things farmers buy. This has been said so often that one may be accused of labouring the point to mention it again. It is a matter that must be appreciated, however, if one would understand the reason for some of the difficulties now being experienced by farmers.

For fourteen out of the twenty years, from 1920 to 1939 inclusive, the prices of farm products were below the prices of commodities in general. Even though the technique of farming has improved and costs have been reduced in the meantime, the returns have been insufficient to maintain the industry on a basis comparable with earlier years or with the status of many industries. It is not surprising, therefore, that there should be some mur-murings of dissatisfaction with efforts to prevent prices from rising, even though some farm products have been exempted from ceiling regulations or have been given special consideration in one way or another.