Canada; its Defences, Condition, and Resources / Being a third and concluding volume of "My Diary, North and South"

by Sir William Howard Russell

Reciprocal Rights—American Ideas of Reciprocity—The Ad Valorem System—Commercial Improvements—Trade with America—The Ottawa Route—The Saskatchewan—Fertility of the Country—Water Communication—The Maritime Provinces—Area and Population.

The absence of a winter port is an evil to Canada, for which no energy and no advantages can compensate. Although Halifax has a magnificent harbour, New Brunswick and Nova Scotia offer but small facilities for winter navigation; and the day seems distant when the great railroad of which so much has been spoken and written shall open the communication between England and the remotest portions of the vast empire which reaches from the Atlantic to the Pacific.

The position of Canada threw her into close relations with the United States, and the result of her geographical condition was the Reciprocity Treaty, which has caused so much discussion and discontent on both sides of the St. Lawrence, and which the Government of the Federal States has now given notice to terminate.

In March, 1862, the report of the Committee of the Executive Council, to which an able paper of Mr. Galt, then Finance Minister, had been referred, advised that the views and suggestions therein expressed by Mr. Galt should be adopted, and that report was approved by Lord Monck. Mr. Galt’s Report was founded on a reference made to him of the report of the Committee on Commerce of the House of Representatives at Washington respecting the Reciprocity Treaty, and of a memorial from the Chamber of Commerce of Minnesota.

The House of Representatives reported in favour of a system resembling that of the “Zollverein” as the only means of securing the benefits of reciprocal trade, and recommended as desirable a uniform system of lighthouses, copyrights, postage, patents, telegraphs, weights and measures, and coinage.

This was a favourite scheme of the late Senator Douglas; and if the American Government had exhibited any desire to diminish the rigours of Morrill Tariffs and of State protective enactments, we might applaud the liberality of their views and the noble candour of their conclusions. They believed that “free commercial intercourse between the United States and the British North-American Provinces, developing the natural, geographical, and other advantages of each for the good of all, is conducive to the present interests of each, and is the proper basis of our intercourse for all time to come”—sentiments certainly noble, if somewhat vaguely expressed. We will see presently how Mr. Galt deals with the practical rendering of them by the Federal Government. The Reciprocity Treaty, negotiated between Lord Elgin and Mr. Marcey in June, 1854, was entered into to avoid further misunderstanding in regard to the extent of the right of fishing on the coasts of British North America, and to regulate the commerce and navigation between the respective territories and people in such a manner as to render the same reciprocally beneficial and satisfactory.

The Convention secured to American fishermen the liberty of taking, curing, and drying fish on the British North-American coast generally; the Treaty extended to them the liberty to take fish of every kind (except shellfish) along the coast of Canada, New Brunswick, Prince Edward’s Island, &c., with permission to land, to dry nets, and cure fish, without any restrictions as to distance from shore—reserving only the right of private property and the salmon and shad-fishings in the rivers; and the same rights were conceded to British subjects on the eastern sea-coasts of the United States north of the 36th parallel of latitude. It provided that the following articles should be admitted duty-free reciprocally:—Grain, flour and breadstuffs, animals, fresh and salt meat, cotton seed and vegetables, fruit, fish, poultry, hides and skins, butter, cheese, tallow, lard, horns, manure, ores, coal, stone, slate, pitch, turpentine, timber and lumber, plants, firs, gypsum, grindstones, dye-stuffs, flax, rags, and unmanufactured tobacco. It gave to Americans the right to navigate the St. Lawrence and the Canadian canals, subject to the tolls, and it gave to British subjects the right to navigate Lake Michigan; but it reserved to the British Government the right of suspending, on due notice, the privileges of Canadian navigation, in which event the right of British subjects to navigate Lake Michigan should also cease and determine, and the United States should have the right of suspending the free import and export of the articles specified. But here, it will be observed, there was a one-sided reciprocity. The Americans received, absolutely, the right of using all the canals in Canada from the British Government; the Government of the United States conferred no such privilege reciprocally on British subjects. All they did—perhaps all they could do in consonance with the doctrine of States Rights they are so busily engaged at present in destroying—was to engage to urge on the State Governments to secure to the subjects of Her Britannic Majesty the use of the several ship-canals on terms of equality with the inhabitants of the United States. It was also provided that “American lumber floated down to St. John and shipped to the United States from New Brunswick should be free of duty.” This treaty was to remain in force for ten years from the date at which it came into operation, and further until the expiration of twelve months after either of the contracting parties gave notice to the other of its wish to terminate the same—each of them being at liberty to give notice at the end of the ten years, or at any time afterwards. This treaty expired on the 11th September, 1864, since which time the United States and Great Britain have been free to give notice of the termination of its provisions, to take effect in twelve months after the date of the notice. Of this power, as already stated, the United States Government has availed itself. An exception to the operation of the treaty is made in the case of Newfoundland, in respect to which its provisions hold good till December 12th, 1865. The State of New York, by its Legislature, urged Congress to protect the United States from what they denounced as an “unequal and unjust system of commerce.” They asserted that nearly all the articles which Canada has to sell are admitted into the United States free of duty, whilst heavy duties are imposed on many articles of American manufacture, with the intention of excluding them from the Canadian market; and that discriminating tolls and duties, in favour of an isolating and exclusive policy against American merchants and forwarders, to destroy the effect of the treaty and in opposition to its spirit, have been adopted by Canada; and on these grounds they demanded a change in the system of commerce now existing, to protect the interests of the United States in the manner intended by the treaty.

The Canadian Minister, in reply, observed that the treaty made no mention whatever of the matters complained of, and, in a very lucid argument, charges against the Legislature of the United States the very same grounds of complaint as the Committee alleged against Canada. No accusation of an infraction of the treaty is made, and therefore the subjects treated of in the Report affect the commercial relations and not the good faith of the contracting parties. The Committee accuse Canada of violating the spirit and intent of the treaty, by an increase of duties on manufactured articles, by a change in the mode of levying duties, and by abolishing tolls on the St. Lawrence canals and river; but Mr. Galt contends that the treaty had nothing to do with manufactures, but was expressly limited to the growth and produce of the two countries mentioned in the schedule. Those articles not enumerated in it are necessarily excluded from its operations, and must be made the subject of special legislation between the two States before any act of either respecting the mode of their admission can be made ground of remonstrance.

As a proof of the narrow spirit in which these fine declaimers about “liberty of commerce and reciprocity of trading advantages” have dealt with the treaty, it may be mentioned that they imposed duties on planks in part planed, tongued, or grooved, and on flour ground in Canada from American wheat, and on lumber made in Canada out of American logs. The Canadian Government, however, have maintained, both against the Americans and the mother country, their right to decide for themselves both as to the mode and the extent to which taxation should be imposed. Declamations against a policy of Protection come indeed with a bad grace from the United States; and Mr. Galt, in suppressed sarcasm and irony, shows that their doctrine of Free Trade with Canada really means an exclusive protection for themselves against the manufactures of Great Britain.