The first step, it is expected, will be to rationalize and mesh still further the war production of the two countries. Until she knew how far the United States was prepared to go in the war, Canada had to make her own war production as self-contained as possible. She Could not be sure, in the early stages of the war, of getting any large amount of materials, weapons or financial support from the United States. Since the United States has guaranteed to supply the weapons necessary for a British victory, Canada can proceed now to concentrate more on the war production which she can most easily master, and leave the more complicated mechanical processes to the United States.
Ca-operation undoubtedly will go further than the factory and work bench. Canada will need the ce-operation of her neighbour, economically and financially, before the war is over.
The immediate problem is exchange. Canada is running behind in her total business with the United States at the rate of some $300,000,000 a year and cannot tain this drain of American dollars, There is the best reason to believe that the United States has indicated its willingness to aid Canada in curbing this flow. The exchange situation could be rectified by several alternative measures—by American loans of money or materials, by repatriation of American securities held in Canada, by American contributions to Canadian. defensive works which help to defend the entire Continent.
The next step, and it must be taken. soon, will be the selection of the best method. The basic problem has completely disappeared, with the United States' decision to back the British Commonwealth, including Canada, to the point necessary to achieve victory. American statesmen are rather surprised that Canada has not sought direct aid from the United States already. The Canadians are extremely conservative people. They do not like foreign debt. In fact, one of the Government's chief satisfactions, as stated in Parliament, is that, through the repatriation of British securities recently, Canada's outside debts have been heavily reduced. Thus Canada has not sought loans of any sort from her neighbour.
Text read from the printed page and cleaned; old type leaves the occasional error.