CANADA: Airlines & Wheat

After weeks of bickering and days of dickering, the quarrel between Colonial Airlines and Trans-Canada Air Lines (TIME, Dec. 12 et seq.) reached a satisfactory—if temporary—solution last week.

The U.S. Supreme Court agreed to hear arguments on Feb. 17 on Colonial's appeal questioning the constitutionality of U.S. bilateral air agreements. This was much sooner than Ottawa had expected. If the agreements are upheld, Washington promised quick action in certifying T.C.A. for the profitable Montreal-New York route, from which it has been barred by Colonial's legal action. Pending the decision, Ottawa called off its move to cancel Colonial's landing rights at Montreal.

Five hours after the air compromise was announced, U.S. Ambassador Laurence A. Steinhardt was threshing over a brand-new problem in Ottawa with ruddy-faced Arnold Heeney, Canada's Under Secretary of State for External Affairs. The new dispute centered around the proposal to ship 100 million bushels of wheat to Western Germany and Japan this year under the 38-nation International Wheat Agreement. Since the grain will be paid for in U.S. dollars, the U.S. took the view that it should be U.S. wheat, of which there is a surplus. Canadian spokesmen argued that the object of the wheat agreement was to restore normal world wheat trade, not provide dumping machinery for surpluses. Canada asked for a quota of between 20 and 30 million bushels.

In London last week, the Wheat Council, meeting in closed session, was considering first the question of sending the grain to Germany and Japan, then the problem of how to divide the shipments among the exporting countries.