The Liberal Government recognizing all these salient factors endeavoured to strike a fair balance and thereby promote the utmost development in all industrial pursuits. The principal thought in their minds was to provide the maximum of profitable labour for the people in all spheres of activity which surely is the truest and highest duty of statesmanship.
The extent of the reduction in taxation brought about by the tariff can be best arrived at by taking the average rate of customs duty imposed by the Conservatives during the last years they were in office, and applying it to the imports under the Liberal rule. In 1896, which was the last year of Conservative administration, $18.28 was on the average collected on every $100 worth of goods imported into the country. If the same rate had been collected during the time the Liberals were in office, instead of collecting duty to the amount of $605,000,000 they would have collected $685,000,000, so that there was an actual reduction of $80,000,000 in fifteen years. This is at the rate of about $5,500,000 per annum. In addition to this saving one has to consider the reduced price of Canadian manufacturers to the consumer by reason of the reduction in protection, because undoubtedly as a general rule, although not in every case, the selling prices of Canadian manufacturers are based upon the amount of protection they enjoy.
Again there is the indirect saving to the people in reduced prices on foreign exports to Canada, by reason of the operation of a British Preferential tariff. The United States exporters to Canada, for instance, had to reduce their price to Canadian buyers to off-set the reduction in duties in favour of British goods. This is an undoubted fact.
Another way of arriving at the extent of the reduction in taxation brought about by the Liberal Government, is to take the average rate of duty imposed by Conservatives during the eighteen years they were in office, which was $19.10 on every $100 worth of goods imported into the country. If the same rate had been applied to the imports during the fifteen years from 1896 to 1911, the additional taxation which would have been imposed would have amounted to $110,000,000, so that there was a saving to that extent to the people of the country under Liberal rule.
Perhaps the most outstanding feature of the new tariff was the adoption of a preference in favour of British goods, and it was probably the most popular step ever taken by any Government in Canada. Judged by results, it has been highly beneficial alike to Canada, Great Britain and the Empire. This preference at first consisted of a reduction of 1-8 from the general tariff rates. A year or so afterwards the reduction was increased from 1-8 to 1-4 and later to 1-3. Subsequently the flat reduction of 1-3 was abandoned and a specific preferential rate provided for each item or article in the tariff. Such specific rate, however, on the whole averages a reduction of 1-3. The benefits of the preference were given not only to Great Britain but by successive steps to nearly all the British colonies.
The preference granted by the Liberal Government was exactly the tonic that was necessary to stimulate British trade. From the moment it became law the trade started to boom and it has steadily and rapidly increased ever since. But the increase in British trade was not the only beneficial result. The preference substantially reduced duties to the Canadian consumer on the most important staple commodities, and thereby further implemented the pledge of the Liberal party to reduce taxation.
Having dealt with the preference feature of the tariff we will now resume the consideration of the general subject. Well as they believe they had wrought in the creation of their tariff, the Liberal Government were not content. They knew that a great deal more was needed to bring about a betterment of conditions. They felt that the most vigorous and progressive measures were necessary to put Canada in its proper place on the map of the industrial world, and to afford scope for the exercise of the natural ambition of its people. They realized that the farmer could not be benefitted much by protective duties on his produce, but they saw that they could benefit him by enlarging the means, and cheapening the cost, of transportation, and they devoted their best energies towards improving and extending transportation facilities all over the country. They saw also that the manufacturer could be benefitted by enlarging the home market, and they instituted an aggressive immigration policy which developed the great North West in a marvellous way. Step by step in the most vigorous manner and without let-up the great work of building surely and strongly was undertaken, and concurrent with it the country grew more prosperous.
The finances were so handled as to show a substantial surplus each year instead of the era of deficits in Conservative days.
The great canal system of the country was rushed to completion.