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: 
7 
7 
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TRANSACTIONS OF SECTION F. 559 
inunicipal, ave freely borrowing foreign capital for investment, o¥ at least 
expenditure, in the country. This capital, together with the native supplies, 
furnishes an immense wage-fund, as well as a fund for supplies, which 
together render Canada an exceptionally good market for labour and 
supplies. The prosperity due to this investment is undisturbed by thoughts 
of future repayment or of interest in the meantime. For some time there 
has been every stimulus to expansion. Increasing wages and profits lead 
to increased prices, and increased prices mean increased cost of living, which, 
in turn, is justification for a further increase in wages and a still further 
increase in prices. 
The expansion of Canadian settlement means the building of thousands 
of miles of railroads through the wilderness, the construction of hundreds 
of towns, and thousands of farm houses, with all that these involve in 
the way of labour and supplhes, the work of transportation, and the 
stimulus to the centres of production in older Canada. So long as foreign 
capital continues to flow in this condition prosperity will accompany its 
expenditure in the country, for the latent resources of Canada are very 
great. It means, however, that Canadian expansion is very largely con- 
ditioned by the financial circumstances of the outside world. 
Assuming the permanency of outside conditions, and regarding only 
the increasing prosperity of the country, as marked by the increase in wages 
and prices, the question arises, Is this prosperity real, or is the greater 
part of it only apparent? How far is the increase in wages neutralised 
by the increase in the cost of living and the increase in prices offset by 
an increase in the cost of production? Also, are there not considerable 
sections of the community who, with little increase in income, have to 
face a large increase in the cost of living? The foundation on which an 
answer to these questions must be sought is the fact that there are but 
two directions in which a community supplying the greater part of its own 
wants may increase its real wealth or elevate the standard of living. One 
is the inducing of Nature to contribute more from her stores per unit 
of persuasive effort; the other is by economising human time and effort 
in working up the products and forces of Nature into articles for the 
supply of wants or the rendering of services. If the benefits from these 
sources are fairly distributed there will be a real increase, not only in 
the community’s wealth, but in the standard of comfort. Under such 
conditions incomes might increase without increasing prices, or prices 
might be lowered without diminishing incomes. Where, however, wages 
and prices both rise in much the same proportion there is little real 
advantage, and what there is is probably drawn from those classes in the 
community who can neither increase their incomes nor prevent others from 
increasing prices and wages. 
A survey of Canadian conditions shows that all three phases of economic 
adjustment are presented. We find in certain cases an increase of natural 
products per unit of labour, and an increase of finished product in propor 
tion to cost in capital, time, and effort. But we find also a purely 
nominal increase in values, as in the reciprocal rise in wages and labour 
wherein one neutralises the other to a very large extent, though the balance 
is not always equally maintained, some gaining while others lose. 
Considerable specific light is thrown on the subject of the real and 
nominal betterment of labour in Canada by a couple of tables of prices 
and wages prepared for this Paper by Mr. R. H. Coates, B.A., of the 
Department of Labour, Ottawa. The table of prices covers such funda- 
mental elements in the cost of living as rent, fuel, and the chief articles 
of food in representative centres throughout the Dominion, and for the 
years 1899 and 1909. The table of wages covers chiefly the building trades 
and phases of unskilled labour in the same centres and for the same years. 
These tables indicate that in the upward struggle between wages and 
