The Canadian Dominion: A Chronicle of Our Northern Neighbor

by Oscar D. Skelton

In the United States the tendency was in the other direction. With the growth of cities, the interests of the consumers of foods outweighed the influence of the producers. Manufacturers in many cases had reached the export stage, where foreign markets, cheap food, and cheap raw materials were more necessary than a protected home market. The "muckrakers" were at the height of their activity; and the tariff, as one instrument of corruption and privilege, was suffering with the popular condemnation of all big interests. United States newspapers were eager for free wood pulp and cheaper paper, just as Canadian newspapers defended the policy of checking export. It was not surprising, therefore, that reciprocity with Canada, as one means of increasing trade and reducing the tariff, took on new popularity. New England was the chief seat of the movement, with Henry M. Whitney and Eugene N. Foss as its most persistent advocates. Detroit, Chicago, St. Paul, and other border cities were also active.

Official action soon followed this unofficial campaign. Curiously enough, it came as an unexpected by-product of a further experiment in protection, the Payne-Aldrich tariff. For the first time in the experience of the United States this tariff incorporated the principle of minimum and maximum schedules. The maximum rates, fixed at twenty-five per cent ad valorem above the normal or minimum rates, were to be enforced upon the goods of any country which had not, before March 10, 1910, satisfied the President that it did not discriminate against the products of the United States. One by one the various nations demonstrated this to President Taft's satisfaction or with wry faces made the readjustments necessary. At last Canada alone remained. The United States conceded that the preference to the United Kingdom did not constitute discrimination, but it insisted that it should enjoy the special rates recently extended to France by treaty. In Canada this demand was received with indignation. Its tariff rates were much lower than those which the United States imposed, and its purchases in that country were twice as great as its sales. The demand was based on a sudden and complete reversal of the traditional American interpretation of the most favored nation policy. The President admitted the force of Canada's contentions, but the law left him no option. Fortunately it did leave him free to decide as to the adequacy of any concessions, and thus agreement was made possible at the eleventh hour. At the President's suggestion a conference at Albany was arranged, and on the 30th of March a bargain was struck. Canada conceded to the United States its intermediate tariff rates on thirteen minor schedules—chinaware, nuts, prunes, and whatnot. These were accepted as equivalent to the special terms given France, and Canada was certified as being entitled to minimum rates. The United States had saved its face. Then to complete the comedy, Canada immediately granted the same concessions to all other countries, that is, made the new rates part of the general tariff. The United States ended where it began, in receipt of no special concessions. The motions required had been gone through; phantom reductions had been made to meet a phantom discrimination.

This was only the beginning of attempts at accommodation. The threat of tariff war had called forth in the United States loud protests against any such reversion to economic barbarism. President Taft realized that he had antagonized the growing low-tariff sentiment of the country by his support of the Payne-Aldrich tariff and was eager to set himself right. A week before the March negotiations were concluded, a Democratic candidate had carried a strongly Republican congressional district in Massachusetts on a platform of reciprocity with Canada. The President, therefore, proposed a bold stroke. He made a sweeping offer of better trade relations. Negotiations were begun at Ottawa and concluded in Washington. In January, 1911, announcement was made that a broad agreement had been effected. Grain, fruit, and vegetables, dairy and most farm products, fish, hewn timber and sawn lumber, and several minerals were put on the free list. A few manufactures were also made free, and the duties on meats, flour, coal, agricultural implements, and other products were substantially reduced. The compact was to be carried out, not by treaty, but by concurrent legislation. Canada was to extend the same terms to the most favored nations by treaty, and to all parts of the British Empire by policy.

For fifty years the administrations of the two countries had never been so nearly at one. More difficulty was met with in the legislatures. In Congress, farmers and fishermen, standpat Republicans and Progressives hostile to the Administration, waged war against the bargain. It was only in a special session, and with the aid of Democratic votes and a Washington July sun, that the opposition was overcome. In the Canadian Parliament, after some initial hesitation, the Conservatives attacked the proposal. The Government had a safe majority, but the Opposition resorted to obstruction; and late in July, Parliament was suddenly dissolved and the Government appealed to the country.

When the bargain was first concluded, the Canadian Government had imagined it would meet little opposition, for it was precisely the type of agreement that Government after Government, Conservative as well as Liberal, had sought in vain for over forty years. For a day or two that expectation was justified. Then the forces of opposition rallied, timid questioning gave way to violent denunciation, and at last agreement and Government alike were swept away in a flood of popular antagonism.

One reason for this result was that the verdict was given in a general election, not in a referendum. The fate of the Government was involved; its general record was brought up for review; party ambitions and passions were stirred to the utmost. Fifteen years, of office-holding had meant the accumulation of many scandals, a slackening in administrative efficiency, and the cooling by official compromise of the ardent faith of the Liberalism of the earlier day. The Government had failed to bring in enough new blood. The Opposition fought with the desperation of fifteen years of fasting and was better served by its press.

Of the side issues introduced into the campaign, the most important were the naval policy in Quebec and the racial and religious issue in the English-speaking provinces. The Government had to face what Sir Wilfrid Laurier termed "the unholy alliance" of Roman Catholic Nationalists under Bourassa in Quebec and Protestant Imperialists in Ontario. In the French-speaking districts the Government was denounced for allowing Canada to be drawn into the vortex of militarism and imperialism and for sacrificing the interests of Roman Catholic schools in the West. On every hand the naval policy was attacked as inevitably bringing in its train conscription to fight European wars a contention hotly denied by the Liberals. The Conservative campaign managers made a working arrangement with the Nationalists as to candidates and helped liberally in circulating Bourassa's newspaper, Le Devoir. On the back "concessions" of Ontario a quieter but no less effective campaign was carried on against the domination of Canadian politics by a French Roman Catholic province and a French Roman Catholic Prime Minister. In vain the Liberals appealed to national unity or started back fires in Ontario by insisting that a vote for Borden meant a vote for Bourassa. The Conservative-Nationalist alliance cost the Government many seats in Quebec and apparently did not frighten Ontario.

Reciprocity, however, was the principal issue everywhere except in Quebec. Powerful forces were arrayed against it. Few manufactures had been put on the free list, but the argument that the reciprocity agreement was the thin edge of the wedge rallied the organized manufacturers in almost unbroken hostile array. The railways, fearful that western traffic would be diverted to United States roads, opposed the agreement vigorously under the leadership of the ex-American chairman of the board of directors of the Canadian Pacific, Sir William Van Horne, who made on this occasion one of his few public entries into politics. The banks, closely involved in the manufacturing and railway interests, threw their weight in the same direction. They were aided by the prevalence of protectionist sentiment in the eastern cities and industrial towns, which were at the same stage of development and in the same mood as the cities of the United States some decades earlier. The Liberal fifteen-year compromise with protection made it difficult in a seven weeks' campaign to revive a desire for freer trade. The prosperity of the country and the cry, "Let well enough alone," told powerfully against the bargain. Yet merely from the point of view of economic advantage, the popular verdict would probably have been in its favor. The United States market no longer loomed so large as it had in the eighties, but its value was undeniable. Farmer, fisherman, and miner stood to gain substantially by the lowering of the bars into the richest market in the world. Every farm paper in Canada and all the important farm organizations supported reciprocity. Its opponents, therefore, did not trust to a direct frontal attack. Their strategy was to divert attention from the economic advantages by raising the cry of political danger. The red herring of annexation was drawn across the trail, and many a farmer followed it to the polling booth.

From the outset, then, the opponents of reciprocity concentrated their attacks on its political perils. They denounced the reciprocity agreement as the forerunner of annexation, the deathblow to Canadian nationality and British connection. They prophesied that the trade and intercourse built up between the East and the West of Canada by years of sacrifice and striving would shrivel away, and that each section of the Dominion would become a mere appendage to the adjacent section of the United States. Where the treasure was, there would the heart be also. After some years of reciprocity, the channels of Canadian trade would be so changed that a sudden return to high protection on the part of the United States would disrupt industry and a mere threat of such a change would lead to a movement for complete union.

This prophecy was strengthened by apposite quotations showing the existing drift of opinion in the United States. President Taft's reference to the "light and imperceptible bond uniting the Dominion with the mother country" and his "parting of the ways" speech received sinister interpretations. Speaker Champ Clark's announcement that he was in favor of the agreement because he hoped "to see the day when the American flag will float over every square foot of the British North American possessions" was worth tens of thousands of votes. The anti-reciprocity press of Canada seized upon these utterances, magnified them, and sometimes, it was charged, inspired or invented them. Every American crossroads politician who found a useful peroration in a vision of the Stars and Stripes floating from Panama to the North Pole was represented as a statesman of national power voicing a universal sentiment. The action of the Hearst papers in sending pro-reciprocity editions into the border cities of Canada made many votes—but not for reciprocity. The Canadian public proved that it was unable to suffer fools gladly. It was vain to argue that all men of weight in the United States had come to understand and to respect Canada's independent ambitions; that in any event it was not what the United States thought but what Canada thought that mattered; or that the Canadian farmer who sold a bushel of good wheat to a United States miller no more sold his loyalty with it than a Kipling selling a volume of verse or a Canadian financier selling a block of stock in the same market. The flag was waved, and the Canadian voter, mindful of former American slights and backed by newly arrived Englishmen admirably organized by the anti-reciprocity forces, turned against any "entangling alliance." The prosperity of the country made it safe to express resentment of the slights of half a century or fear of this too sudden friendliness.