Sunny Ways : Imperial Preference, New Boom, and Last Best West, 1896–1911

May 28th, 2017 | By Randall White | Category: Heritage Now

The late 19th century Canadian liberal nationalist light that failed was Edward Blake —  founder of the early 21st century business law firm Blake, Cassels & Graydon LLP (aka “Blakes”), with offices in Toronto, Vancouver, Calgary, Ottawa, Montréal, New York City, London (England), Beijing, and Manama (Bahrain).

Blake came from a well-off progressive family of the ruling Protestant Ascendency in Ireland, that moved to Upper Canada in 1832.  He was born in 1833 in what is now southwestern Ontario. But soon enough his father, William Hume Blake, a graduate of Trinity College, Dublin, abandoned his rugged romance as a pioneer family farmer for the life of a rising business lawyer in Toronto (and then a politician and judge).

Edward Blake was only three years old when he first accompanied his father on a trip to Europe (not something in which most Ontario family farmers of the era could indulge). And he became a voracious reader only a few years later. After successful careers at Upper Canada College and the University of Toronto, he followed in and finally surpassed his father’s business legal footsteps, in partnership with his younger brother Samuel.

“Young Blake of Toronto” (see Joseph Schull’s 1975 biography) was successful enough at the original Blake & Blake law firm to become well off in his own right by his mid 30s. Just after confederation, George Brown recruited him as a Liberal (Reform) politician.

Outfoxing the Tories and attacking Louis Riel just after the  Red River Rebellion (and the execution of the Orangeman Thomas Scott) may have helped Edward Blake become premier of Ontario in 1871. But by 1872 he had given this up for federal politics.

In Ottawa Blake’s skilled legal oratory played a crucial role in  bringing down the Macdonald Conservatives over the Pacific Scandal. Yet when the  time came to form a Liberal government late in 1873 the brilliant Toronto lawyer argued that a bout of personal ill health forced him to support Alexander Mackenzie as the new federal prime minister.

Blake’s health subsequently improved. After Mackenzie’s defeat in the 1878 election, Edward Blake finally served as official leader of the Liberal Party of Canada, 1880–1887. But his Liberals could not defeat Macdonald’s Conservatives in the 1882 and 1887 elections either. And he would go on to become the only Canadian federal Liberal leader who never became prime minister — until Stéphane Dion and Michael Ignatieff joined him in this distinction early in the 21st century.

Edward Blake’s greatest contribution to Canadian political history was probably the grooming and ultimate engineering of Wilfrid  Laurier from Quebec as his successor in the Liberal leadership. Laurier would go on to become politically, in the subtitle of Joseph Schull’s now classic 1965 biography, what Edward Blake aspired to but never quite managed —  The First Canadian. As if to underline the point, Blake in his final career returned to his parents’ homeland and served as an Irish Nationalist member of the British House of Commons, from 1892 to 1907. (Though, to show where his heart remained, after a stroke in 1907 he retired back to Canada and died in Toronto, on March 1, 1912.)

* * * *

Other federal Liberals were at first sceptical about Laurier.  And he too lost his first election as leader to the Macdonald  Conservatives, on Thursday, March 5, 1891. Yet like the Canadian federal election some 20 years later in  1911, the 1891 contest was dominated by a potent mixture of trade policy and identity politics that uniquely disadvantaged the Liberals.

Whatever else, by the early 1890s Macdonald’s National Policy of tariff protection for manufacturers, and railway transportation from coast to coast, was still not bringing great economic prosperity to a geographically vast dominion, with still not quite 5 million people. Not long before the 1891 election Macdonald himself initiated inquiries in Washington about reviving the old 1854–1866 reciprocity or free trade agreement with the United States, that Senator George Brown and others had  failed to resuscitate in the mid-1870s. As economic policy Macdonald’s early 1890s explorations were equally unsuccessful. But they did give him a crucial key to his last election.

To illustrate American opinion in the age of the Great Barbecue, Peter B. Waite cites James G. Blaine, US secretary of state at the time of Macdonald’s queries : “Beyond the frontier, across the river, our neighbours chose another Government, another allegiance … exactly as they have a right to do … But I am opposed …  to giving the Canadians the sentimental satisfaction of waving the British flag … and enjoying the actual cash remuneration of American markets. They cannot have both.  If they come to us they can have what we have, but … So far as I can help it, I do not mean that they shall be Canadians and Americans at the same time.”

Unfortunately for Laurier, in 1891 the great bulk of his Liberal party  activists had still not quite digested the political boundaries suggested by remarks of this sort from the “Yankee to the south of us” who “must south of us remain” (Pauline Johnson, aka Tekahionwake). In the early 21st century, with battles of the late 20th century fresh in mind, we see Liberals as more sceptical about Canada-US free trade than Conservatives. In the late 19th century the positions were reversed. And Laurier’s Liberals endorsed a  vague concept called “unrestricted reciprocity” with the United States as a key part of their 1891 campaign.

These early Laurier Liberals argued that unrestricted reciprocity — free trade in all products between Canada and the United States, but separate tariff walls in each country for other countries  — was not the same as “commercial union” :  free trade and the same tariff walls for other countries. And if Canadian commercial union with the United States was very close to American political annexation of Canada, unrestricted reciprocity was not (or so the argument went).

At least a certain wider fascination with American annexation of Canada nonetheless haunted the early 1890s. The book still known as the “classic case for union with the US” — Canada and the Canadian question, by Goldwin Smith, a former Oxford University Regius professor of history who retired to “The Grange” in Toronto — was first published in 1891. Analytic distinctions between unrestricted reciprocity and commercial union may also have been too subtle for popular debate. And commercial union no doubt did imply some degree of political union

Masterful retail politician that he was, Macdonald exploited the situation adroitly in his last electoral hurrah. Despite his own explorations in parallel directions not too long before, he urged that the kind of Canadian-American trade deal Laurier’s Liberals were proposing would soon amount to American political annexation of Canada — and the end of the 1867 confederation’s emerging status as first self-governing dominion of the global empire. And his own choice was clear : “A British subject I was born, a British subject I will die.”

In a growing British North American political experiment where the great majority of old and new migrants from across the seas were still from the United Kingdom — and had presumably moved to Canada rather than  the United States because they wanted to somehow preserve their British identity —  this appeal had serious attractions. (And it didn’t help that the former Liberal leader Edward Blake seemed to agree with much of the Conservative argument!) In the end John A. Macdonald won his last election handily enough, with 51%  of the cross-country popular vote and 123 of the 215 seats in the 1891 Canadian House of Commons.

* * * *

Several things had changed by the election of Tuesday, June 23, 1896 that the Laurier Liberals finally won. (They took just over 45% of the popular vote, in a foreshadowing of the three-or-more party system to come, and 117 or 118 out of 213 seats.) Still more would change after they took office.

To start with, despite a windy pastoral letter from the Quebec bishops, Laurier had finally defanged the francophone Catholic clergy’s traditional hostility towards “liberalism” and Liberals. Laurier’s party took 75% of Quebec’s federal seats in 1896, compared with 57% in 1891, and only 49% for the Blake Liberals’ last outing in 1887.

Having finally learned their own imperial economic patriotism lesson from John A. Macdonald in 1891, the Laurier Liberals recognized as well what Ontario Premier Oliver Mowat (also Laurier’s first minister of justice) spelled out in the early 1890s. The provinces of the first self-governing dominion were “not yet sufficiently welded together to form Canada into an independent nation … the strongest tie which up to this moment binds the provinces together is their common British connection.”

Similarly recognizing that Macdonald’s National Policy by itself was not enough, and that the United States was not (then) interested in free trade, in 1897 Laurier “brought into effect a budget remitting 25 per cent. of the Canadian import duties when goods were of British origin. This ‘imperial preference’ was increased to 33 1/3 per cent. in 1900 … A similar preferential tariff on British goods was adopted by New Zealand in 1903, by South Africa in 1904, and by Australia in 1907” (W. Stewart Wallace).

Probably much more important than anything else, after the 1896 election the Laurier government (led by Clifford Sifton from Manitoba, minister of the interior) aggressively promoted the settlement of the North American “Last Best West”—  in an expanded Manitoba and what became the two new prairie provinces of Saskatchewan and Alberta in 1905.

This helped generate unprecedented migration from “Britain, the United States and Europe” (including the East European Plain in the Ukraine). And this dramatically accelerated Canada’s population and economic growth in the very late 19th and early 20th centuries.

* * * *

For most of the 1890s the Canadian cross–country annual population growth rate hovered around 1%. In 1899 it rose to 1.2%, and then to 1.3% for the two subsequent years. In 1902 it jumped to 2.3%. Then it went to 3.0% in 1905 and peaked at 5.2% in 1907. Overall, Canada’s population grew by 11.1% between 1891 and 1901. Then the growth rate suddenly more than tripled to 34.2% between 1901 and 1911.

By contrast, population in the neighbouring United States grew by 21.0% between 1890 and 1900, and then by 21.0% again between 1900 and 1910. Or (as noted earlier) Canada’s population  actually grew at a faster rate in the first decade of the 20th century than the population in the United States — 34% + in Canada instead of 21% south of the border. And this trend would carry on into the second decade of the century too!

In the midst of all this an expanding resource-and-manufacturing Canadian economic base moved its 19th century wheat economy from the old Ontario to the rapidly growing new Prairie Provinces of the Last Best West. Canada at large entered what Lyndon Johnson’s economic development and Vietnam War guru Walt Whitman Rostow would much later call its “take off.” And from here it set out on a drive to “technological maturity,” culminating  in a brave new world of “high mass-consumption.”

As Rostow would also note in The Stages of Economic Growth : A Non-Communist Manifesto (first published in 1960), “in Canada and certain other cases, we even have societies which have entered into the stage of high mass-consumption before technological maturity was attained … An economy with a good population/resource balance, like Canada or Australia, can … move into high mass-consumption before it has applied the full range of existing technologies to its natural resources.” Or, countries like Canada and Australia in at least some significant degree entered their first brief bursts of high mass-consumption along with the United States in the 1920s. But they did not reach “technological maturity” until the 1950s — something the United States had achieved by 1900.

Analysis of this sort may seem less compelling in the earlier 21st century than it did to the Eisenhower, Kennedy, and Johnson administrations in Washington that employed Walt Whitman Rostow in the 1950s and 1960s, and the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin that hosted his later career. And all this is certainly getting a little too far ahead of the story here.

Yet Rostow’s “defense of free enterprise economics, particularly in developing nations” can also appear as surprisingly effective in hindsight. And he did point to one continuing Canadian truth. The manufacturing sector bred by the National Policy of tariff protection — pioneered by John A. Macdonald and then more broadly accepted (starting with Laurier) — has arguably enough played some useful roles in North American industrial growth. What the rest of the world has always found more interesting, however,  is the export-oriented Canadian resource economy.

It arose with the new world economy that began during Western Europe’s “long sixteenth century” on the high seas. It started with the “Indian-European” multiracial fur trade and the cod fisheries. It moved on to lumbering, mining, and  the wheat economy (and the great collective agricultural enterprise of the North American family farm, in both English-and French-speaking Canadian incarnations). Then there was pulp and paper, hydroelectricity,  gold and silver, nickel, copper, iron and steel, and oil and gas. Along the way, by the end of the first decade of the 20th century a second family farm society of the wheat economy had opened up a new Canadian Prairie West of Manitoba, Saskatchewan, and Alberta. (And British Columbia was just beginning to understand how much valuable softwood  lumber it had in its vast Pacific forests.)

Good vibrations from all this and more were spreading across the country. The Eaton’s department store in Toronto had catalogues delivered to settlers’ tents on the western prairie. Banks and railway headquarters in Montreal counted new money. The Laurier Liberals were elected again in 1900, 1904, and 1908. They took majorities of the popular vote in Quebec and everywhere else, except an increasingly urban new Tory Ontario, and sometimes Manitoba or British Columbia as well. Meanwhile William Fielding, a former premier of Nova Scotia who had once advocated taking his province out of confederation, was Wilfrid Laurier’s minister of finance, 1896–1911. And Nova Scotia gave the Laurier Liberals 50% of its seats in Ottawa in 1896, 75% in 1900, 100% in 1904, and 67% in 1908. In the 1904 campaign “Laurier and the larger Canada” was said to be “the star towards which all men who love progress and freedom shall come for the next hundred years.” This would of course prove a vast exaggeration, but it captured the sunny ways of Joseph Schull’s First Canadian, during Canada’s intoxicating great burst of growth in the early 20th century.

* * * *

As in other parts of a surging new world economy, Canadian development would no doubt have stumbled anyway during the First World War of 1914–1918. (And annual population growth rates did peak in 1907 — also the year of the Knickerbocker Crisis in New York City : “the first worldwide financial  crisis of the twentieth century” that ultimately “led to the creation of the Federal Reserve System” in the United States in 1913.)

Yet Laurier’s Liberals in Canada had a political head start on the trend in the surprising “Our Lady of the Snows” election of 1911 — a haunting reprise of the 1891 election, 20 years later. (The two elections have much more recently been adroitly surveyed in two books published in 2011 — The Destiny of Canada: Macdonald, Laurier and the Election of 1891 by Christopher Pennington, and Canada 1911: The Decisive Election That Shaped the Country by Patrice Dutil and David MacKenzie.)

To go back to the beginning, as it were, Laurier’s time as Canadian prime minister coincided with growing interest (in some places) in closer ties among the United Kingdom and what became known as the several self-governing dominions of the empire at the first Imperial Conference of 1907 in London. (At this point the dominions were Canada, Australia, Newfoundland, and New Zealand. A quite openly racially exclusive Union of South Africa was added in 1910. The “possibilities of Irish Home Rule and self-governance for India were also discussed” at the 1907 Conference.)

As its 1897 introduction of an “Imperial Preference” for imports of British goods in Canadian tariff policy confirmed, the Laurier Liberal government supported closer imperial economic ties. But Laurier himself was also Joseph Schull’s “First Canadian.” He was sceptical about more intimate imperial military and political entanglements. On his kind of liberal nationalist assumptions Canada’s ultimate destiny was to become a country in its own right. Yes, the formal “British connection” was important in the early 20th century.  But Canada was not meant to forever remain a mere self-governing quasi-colonial dominion, even of the greatest empire since Rome. (And then there was of course the great precedent-setting example of a republican path to political maturity right next door.)

Laurier’s practical approach here is reflected in his handling of Conservative (and other) demands for Canadian assistance to the British Royal Navy. Ardent imperialists wanted the dominion to make a financial contribution to the Navy in the United Kingdom. Ardent anti-imperialists wanted Canada to do nothing. Laurier’s compromise was to create a Canadian Navy that could assist the British Navy in defending the empire.

A federal government website today explains : “On May 4, 1910, the enactment of the Naval Service Act created the Department of the Naval Service and the establishment of a Canadian navy. The prefix ‘Royal’ was added in 1911, creating the Royal Canadian Navy (RCN).”  (And then : “In 1968, the navy was merged with the army and air force to form the Canadian Armed Forces. The maritime component was named Maritime Command. In 2011, the title Royal Canadian Navy was restored.”)

* * * *

As what the inventor of modern Western political science Niccolo Machiavelli called fortuna would have it, just as Laurier’s still controversial Canadian Navy compromise of 1910 was being ironed out, his government in Ottawa heard from the government of William Howard Taft in Washington, DC.  As explained by Michael Hart in his policy history tour de force of 2003, A Trading Nation : Canadian Trade Policy from Colonialism to Globalization : “Through an intermediary, the Rev. J.A. Macdonald, editor of the Toronto Globe, Taft proposed to Laurier that the two governments appoint plenipotentiaries and negotiate a reciprocity agreement” between the United States and Canada, at last.

Why was the United States suddenly interested in a Canada-US reciprocity agreement in 1910, but not in the 1890s or 1870s? One  explanation could have something to do with the great burst of Canadian population growth in the first decade of the 20th century. According to the US Census, the legendary western settlement frontier that had driven American growth for generations finally closed in 1890. The Last Best West was in Canada, not the United States. And : “In 1893, three years after the superintendent of the Census announced that the western frontier was closed, Frederick Jackson Turner, a historian from the University of Wisconsin, advanced a thesis that the conquest of the western frontier had given American society its special character” (Digital History).

President Taft had some narrower political motivations of his own. High US tariffs were losing some of their popularity in the early 20th century. Taft’s Republican party was seriously divided over tariff reform.  His own support for the 1909 Payne–Aldrich Tariff (which was supposed to reduce tariffs but didn’t) had left him looking for a tariff reform project to brag about. American policy at large was in the midst of a journey to the Underwood Tariff of 1913 — the first significant reduction in US tariffs since the Civil War. In 1910 almost any kind of new reciprocity agreement with Canada suddenly had appeal for both the White House and Congress, as a useful step along the way to broader US tariff reform.

In response to the initial overtures from Washington, Laurier’s finance minister William Fielding (from Nova Scotia) and customs minister  William Paterson (from Hamilton, Ontario) began negotiations with their counterparts in the US capital early in November 2010. Their counterparts proved surprisingly generous and eager for almost any agreement. There would be largely free trade in resource products but still considerable protection for most Canadian manufacturing. Canada would also continue with its Imperial Preference on British imports.  A deal was concluded before the end of January 1911. And at first it seemed like just more manna from heaven — and still more sunny ways for the Laurier Liberals.

As Robert Craig Brown and Ramsay Cook explained in their “polished and lucid” 1970s survey of early 20th century Canadian history: “Fresh from Washington, Fielding enthusiastically presented the agreement to Parliament on January 26. Most Liberals were surprised and jubilant ; after decades of degrading begging for reciprocity … not only had Washington now come to Ottawa on bended knee but a broad agreement for freer trade had actually been accomplished … the Conservatives were thunderstruck. ‘There was the deepest dejection in our party, and many of our members were confident that the government’s proposals would appeal to the country and would give it another term of office,’ [Conservative leader Robert] Borden observed.”

Joseph Schull told a similar story in his 1965 biography of Laurier : The First Canadian : “For a week Borden faced a distracted and dejected party not even disposed to fight. The Quebec Conservative wing, apart in everything else, was one with the English in this. Even [the French Canadian nationalist Henri] Bourassa … inclined to reciprocity … Reciprocity for him meant ‘Canada for the Canadians’. He did not believe it would lead toward annexation by the United States, and whatever it did to lessen imperialist hopes was all to the good.”

Yet less than a month later an anti-reciprocity manifesto from “eighteen Liberal Toronto businessmen and financiers” showed unmistakable signs of trouble ahead. The “Toronto Eighteen” (including the presidents of the Canadian Bank of Commerce, Eaton’s department stores, and Christie biscuits) opposed reciprocity because it would (they urged) “weaken the ties which bind Canada to the Empire … and make it more difficult to avert political union with the United States.”

When a Canadian general election was finally held on Thursday, September 21, 1911, with the proposed new Canada-United States Reciprocity Agreement as its central issue, a much reinvigorated  Conservative party led by Robert Borden from Nova Scotia successfully revived John A. Macdonald’s strategic 1891 blend of British empire loyalty and Canadian economic nationalism. And the sunny-ways of Wilfrid Laurier and his Liberal Party of Canada — already in office for 15 consecutive years — came to a sudden dark end.

FROM

Children of the Global Village
Canada in the 21st Century : Tales about the history that matters

Randall White
eastendbooks  2017

(For background on the larger series of which this is a part, see The Long Journey to a Canadian Republic.)

PART III
DOMINION OF CANADA, 1867–1963

3
Edward Blake’s liberal nationalist light that failed …  Wilfrid Laurier loses 1891 election … Sunny ways beckon : the changed situation in 1896 and beyond  … New boom, Last Best West, and Canada’s economic “take off” … Imperial conference of 1907 and Laurier’s new Canadian Navy 1910 … A sudden great surprise : Taft Republicans offer new Canada-US reciprocity deal at last

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