CANADA AND FOREIGN POWERS
Europe and Asia--The United States--Reciprocity
The early years of the Laurier regime brought Canada into the visual
range of the outside world. During the middle years the business of
the country's internal development overshadowed everything else. Then
in the later years the relations of Canada with other countries came to
occupy an increasingly important place on the political stage.
At last, Canada's rising star compelled the attention of foreign
countries beyond the seas. Some of these countries sent capital, and
no Canadian objected. Some sent goods, and manufacturers and producers
raised the questions of protection and reciprocal tariff privileges.
Others, as we have seen, sent men. Some of these immigrants Canada
welcomed indiscriminately, some she took with qualms, while against
others she erected high barriers, with half a mind to make them still
higher.
First, as to trade and tariffs, which were the {250} chief subjects of
discussion with European governments. The original Fielding tariff of
1897 had adopted the minimum and maximum principle, with the intention
that a few low-tariff countries should share with Great Britain the
advantages of the lower rates. Treaty complications made this
impossible, and the lower rates were confined to the Empire. Then in
1907 came the intermediate tariff as a basis for bargaining. The
Government turned first to France. Mr Fielding and Mr Brodeur,
associated with the British ambassador at Paris, negotiated a treaty,
giving France the intermediate and in some cases still lower rates, and
receiving advantages in return. The treaty, though made in 1907, was
not ratified until 1910. Owing to existing British treaties with
most-favoured-nation clauses which bound the colonies, the concessions
given France had to be extended to Austria, Denmark, Norway, Sweden,
Spain, and Switzerland. Belgium and Holland, both low-tariff
countries, received many of the same concessions, and in the same year
(1910) a special convention was made with Italy. All the latter
negotiations were carried on direct between the Canadian Government and
the foreign consuls-general in Canada. In the {251} agreement with
Italy the parties were termed 'the Royal Consul of Italy for Canada,
representing the government of the Kingdom of Italy, and the Minister
of Finance of Canada, representing His Excellency the Governor-General
acting in conjunction with the King's Privy Council for Canada.'
Meanwhile less friendly relations had arisen with Germany. Angry at
the action of Canada in giving British goods a preference, Germany in
1899 withdrew her minimum rates on Canadian products, imposing the much
higher general rates. The Laurier Government protested that the
British preference was a family affair, and that so long as Germany was
given the same rates as other foreign countries she had no excuse for
retaliation. But this soft answer did not turn away Teutonic wrath; so
in 1903 Canada retorted in kind, by levying a surtax of one-third on
German goods. The war of tariffs lasted seven years. While it
hampered the trade of both countries, German exports were much the
hardest hit. Germany took the initiative in seeking a truce, and in
1910 an agreement was reached between Mr Fielding and the German
consul-general. Germany dropped her protest against the British
preference, and gave the Dominion the {252} minimum rates on the most
important dutiable exports in return for, not the intermediate, but the
general tariff rates. So ended one of the few instances of successful
retaliation in all the chequered annals of tariff history.
Secondly, as to men. This was the issue with Asiatic powers. The
opposition to Asiatic immigration, so strong in Australia and South
Africa as well as in the United States, prevailed in Western Canada.
Working men demanded protection against the too cheap--and too
efficient--labour of the Asiatic as validly as manufacturers objected
to the importation of the products of European 'pauper labour.'
Stronger, perhaps, was the cry for a White Canada based on the
difficulty of assimilation and the danger to national unity of huge
colonies of Asiatics in the thinly peopled province beyond the
mountains.
Chinese navvies first came to Canada to aid in building the government
sections of the Canadian Pacific Railway. An immediate outcry
followed, and in 1885 a head-tax of $50 was imposed on all Chinese
immigrants not of the official, merchant, or scholar classes. During
the nineties slightly over two thousand {253} a year paid the price of
admission to the Promised Land. Then growing prosperity attracted
greater swarms. Doubling the tax in 1901 only slightly checked the
flow, but when it was raised to $500 in 1904 the number willing to pay
the impost next year fell to eight. But higher wages, or the chance of
slipping over the United States border, soon urged many to face even
this barrier, and the number paying head-tax rose to sixteen hundred
(1910) and later to seven thousand (1913). These rising numbers led
British Columbia to demand total exclusion; but, thanks to the
diffusion of the Chinese throughout the Dominion, their lack of
assertiveness and their employment for the most part in industries
which did not compete with union men or the smaller merchants, the
agitation did not reach great proportions.
It was otherwise with the newcomers from Japan. Their competition was
more serious. Aggressive and enterprising, filled with a due sense of
the greatness of Japan, aspiring to not merely menial but controlling
posts, they took firmer root in the country than did the migratory
Chinaman. At the same time Japan's rising power, her obvious
sensitiveness, and her alliance with Great Britain made it {254}
expedient to treat her subjects more warily than those of quiescent
China. There was practically no Japanese immigration until 1904-5,
when three hundred entered. In 1905 the Dominion Government decided to
adhere to the Anglo-Japanese treaty in order to secure favourable terms
in Japan's market. A clause of this treaty provided for the free
entrance of each country's subjects into the other country. When asked
by the colonial secretary whether they wished to reserve the right to
restrict immigration, as Queensland had done, the Dominion authorities
declared that they would accept the treaty as it stood, relying upon
semi-official Japanese assurances of willingness to stop the flow in
Japan itself. Then suddenly, in 1906 and 1907, a large influx began,
amounting to seven thousand in a single year. This immigration, which
was prompted by Canadian mining and railway companies acting in
co-operation with Japanese societies, came via the Hawaiian Islands.
Alarm rose rapidly in British Columbia, and was encouraged by agitators
from the United States. The climax came in September 1907, when mobs
attacked first the Chinese and later the Japanese quarters in
Vancouver, doing much damage for a time, but {255} being at last routed
by Banzai-shouting bands of angry Japanese. The Dominion Government at
once expressed its regret and in due time compensated the sufferers
from the riot. To solve the larger question, Mr Lemieux was sent to
Japan as a special envoy. Cordially supported by the British
ambassador at Tokio, he succeeded in reaching a very satisfactory
agreement. The Japanese Government itself agreed to restrict
immigration direct from Japan, and to raise no objection to Canadian
prohibition of immigration by way of Hawaii. This method was much more
acceptable to Japan's pride than direct Canadian restrictions would
have been, and proved equally effective, as the number of Japanese
entering Canada averaged only six hundred in the following years. The
Dominion Government's course was open to criticism in some points, but
its earnest endeavour to safeguard imperial as well as national
interests, and the success of Mr Lemieux's diplomacy, were indications
that the Dominion was rising to the demands of its new international
position. Incidentally it was the Government's unwillingness to agree
to complete Japanese exclusion that in 1908 brought the loss of every
seat, save one, in British Columbia.
{256}
After the Alaskan boundary had been settled, no critical issue arose
between the two North American democracies for several years. There
were still questions outstanding which in earlier days would have given
opportunity for tail-twisting or eagle-plucking politicians to make
trouble, but in the new era of neighbourliness which now dawned they
were settled amicably or allowed to fall into blessed oblivion.
A remarkable change in the spirit in which the two peoples regarded
each other came about in this period. The abandonment by the United
States of its traditional policy of isolation, its occupation of the
Philippines, its policy of the open door for China, its participation
in the Morocco dispute, effected a wonderful transformation in the
American attitude towards questions of foreign policy and compelled a
diplomacy more responsible and with more of give and take. This led to
incidents--such as that in Manila Bay, when a British admiral lined up
alongside the American fleet against a threatening German
squadron--which made it clear that Great Britain was the one
trustworthy friend the United States possessed. The steady growth of
democratic feeling in Britain, her daring {257} experiments in social
betterment, her sympathetic treatment of the Irish and South African
questions, increased the friendliness and the interest which the
majority of Americans felt at bottom for what was their motherland.
Canada's prosperity awakened respectful interest. A country which
fifty or a hundred thousand good Americans every year preferred to
their own must be more than the negligible northern fringe it once was
thought to be.
Canada reciprocated this more friendly feeling. Prosperity mended her
querulous mood and made her too busy to remember the grievances of
earlier days. Her international horizon, too, had widened; the United
States was no longer the sole foreign power with which she had to deal,
though still the most important. Yet this friendlier feeling did not
lead to a general desire for freer trade relations. Quite the
contrary; confident in her own newly realized resources and in the
possibility of finding markets elsewhere, dominated by protectionist
sentiment and by the growing cities, Canada became on the whole
indifferent to what had once appeared an essential goal. In Sir
Wilfrid Laurier's phrase, the pilgrimages from Ottawa to Washington had
ceased: {258} the pilgrimages must come, if at all, from Washington to
Ottawa.
Washington did come to Ottawa. Notable was the visit of Secretary Root
in 1907, to discuss outstanding issues. Notable too, in another
direction, was the increased interest of the British ambassador at
Washington in Canadian affairs. This was particularly true of Mr
Bryce, who made it a point to visit Ottawa every year of his term, and
declared that he was really more the Canadian than the British
ambassador. His skilful diplomacy and his intimate knowledge of
American politics served Canada in good stead, and quieted the demand
which had frequently been voiced for a separate Canadian representative
at Washington.
Among the fruits of the new friendliness and the more direct diplomatic
discussion was the settlement of two long-standing fishery disputes.
The much discussed Convention of 1818, in respect to the Atlantic
fisheries, was referred to the Hague Tribunal in 1910, where it was
finally set at rest. The controversy as to fur-sealing on the Pacific
was settled by international agreement in 1911. Less success was met
in dealing with the fisheries of the Great Lakes. A comprehensive
treaty {259} for the protection and development of these fisheries,
drawn up in 1908, was not ratified because of the opposition of some
private interests in the United States.
The most significant achievement of these years, however, was a broad
provision for the settlement of all disputes as to boundary waters.
The pressure for the use of boundary rivers for the development of
power, with all the difficult questions arising as to division of the
power or obstruction to navigation, made necessary such a provision.
In accordance with a suggestion from the United States a temporary
Waterways Commission was set up (1905); and in 1910 a treaty was
ratified providing for a permanent International Joint Commission, to
consist of three Canadians and three Americans. The treaty provided,
further, that any matter whatever in dispute between the two countries,
quite aside from boundary-water issues, might be referred to the
commission for settlement, with the consent on the one hand of the
United States Senate, and on the other of the Governor-General in
Council--the Dominion Cabinet. Quietly, with little public discussion,
the two countries concerned thus took one of the most advanced steps
yet made towards {260} the peaceful settlement of all possible sources
of conflict.
The revival of the tariff issue was the most spectacular and most
important episode in the new relationship. The revival started in the
Republic. For some years a steadily growing agitation in favour of
reciprocity with Canada had been carried on in the New England and
Northwest states. Nothing might have come of the agitation, however,
had not the Payne-Aldrich tariff of 1909 compelled official negotiation
and opened up the whole broad issue. Under that tariff the system of
maximum and minimum schedules was adopted, the maximum designed to
serve as a club to compel other nations to yield their lowest rates.
The president was directed to enforce these higher duties against all
countries which had not agreed by April 1910 to grant the concessions
demanded. The proposal partook of the highwayman's methods and ethics
even more than is usual in protectionist warfare; and it was with wry
faces that one by one the nations with maximum and minimum tariffs
consented to give the United States their lower rates. France and
Germany were the last of European nations to accept. Canada {261}
alone remained. It was admitted that the preference granted other
parts of the Empire did not constitute discrimination against the
United States, but it was contended that the concessions made to France
should be given to the United States.
Canada resented this demand, in view of the fact that the minimum
tariff of the United States stood much higher than the maximum of
Canada, and it was proposed to retaliate by a surtax on American goods.
In the United States there was wide sympathy with this attitude; but
under the act the president had no option but to enforce the higher
duties if the concessions were not given. Fortunately he was left to
decide as to the adequacy of such concessions, and this made agreement
possible at the eleventh hour. President Taft proposed a conference at
Albany; the Dominion Government accepted, and an agreement was reached
on the 30th of March, the last day of grace but one. Canada conceded
to the United States its intermediate rates on a few articles of minor
importance--china-ware, window-glass, feathers, nuts, prunes, and other
goods--and the United States accepted these as equivalent to the French
concessions. Then, to complete the comedy, Canada at once made {262}
these lower rates part of its general tariff, applying to any country,
so that the United States in the end was where it started--enjoying no
special concessions whatever. Canada had gone through the motions of
making a concession, and that sufficed.
This agreement, however, was only the beginning. President Taft, who
recognized too late that he had antagonized the growing low-tariff
sentiment in the United States by his support of the Payne-Aldrich
tariff, decided to attempt a stroke for freer trade. He proposed a
broad revision of trade relations with Canada. In negotiations which
began at Ottawa and were concluded at Washington in January 1911, an
agreement for a wide measure of reciprocal free trade was effected. It
was nearly as broad as the treaty of 1854. Grain, fruit and
vegetables, dairy products, live stock, fish, hewn lumber and sawn
boards, and many minerals were put on the free list. Meats, flour,
coal and other articles free in the earlier agreement were subjected to
reduced rates, a limited number of manufactured articles were included,
some of them Canadian and some of them American specialties. The
agreement was to be effected, not by treaty but by concurrent
legislation for an {263} indefinite period. The Canadian Government
announced that the same terms would be granted all parts of the British
Empire.
After the cabinets, the legislatures. President Taft had great
difficulty in securing the consent of Congress. Farmers and fishermen,
stand-pat Republicans and anti-administration insurgents, opposed this
sudden reversal of a traditional policy. Only by the aid of Democratic
votes in a special session of Congress was the measure adopted, late in
July. Meanwhile the Opposition in the Canadian parliament, after some
initial hesitation, had attacked it with growing force. They resorted
to the obstruction which the Liberals had practised in 1896, and
compelled the Government to appeal to the country, a week after
Congress had accepted the agreement.
After parliament, the people. Apparently the Government anticipated
that the bargain would be welcomed by nearly all Canadians. That
expectation was not without warrant. It was such a treaty as Canada
had sought time and again during the last fifty years, and such as both
parties would have accepted without question twenty years before.
Every important leader of the Conservative party was on record as
favouring such an {264} arrangement. Yet it was received first with
hesitation, then more and more freely denounced, and finally
overwhelmed.
On the economic issues concerned the advocates of the agreement
apparently had a good case. The farmer, the miner, the fisherman stood
to gain from it, not so notably as they would have done twenty years
before, but yet undoubtedly to gain. It was contended that the United
States was itself a rival producer of most of the commodities in
question, and that Canada would be exposed to the competition of the
British Dominions and the most-favoured nations. These arguments had
force, but could not balance the advantages of the arrangement,
especially to the western farmer. That this gain would accrue and a
large trade north and south be created, to the destruction of trade
east and west, was in fact made by the opponents of the treaty the
chief corner-stone of their economic argument. It was held, too, that
the raw products of farm and sea and forest and mine ought not to be
shipped out of the country, but ought to be kept at home as the basis
of manufacturing industries. And though the arrangement scarcely
touched the manufacturers, the thin end of the wedge argument had much
weight {265} with them and their workmen. It would lead, they thought,
to a still wider measure of trade freedom which would expose them to
the competition of American manufacturers.
But it was the political aspect of the pact that the Conservatives most
emphasized. Once more, as in 1891, they declared Canadian nationality
and British connection to be at stake. Reciprocity would prove the
first long step towards annexation. Such was the intention, they
urged, of its American upholders, a claim given some colour by
President Taft's maladroit 'parting of the ways' speech and by Speaker
Clark's misplacedly humorous remark, 'we are preparing to annex
Canada.' And while in Canada there might be as yet few annexationists,
the tendency of a vast and intimate trade north and south would be to
make many. Where the treasure was, there would the heart be also. The
movement for imperial preferential trade, then strong in the United
Kingdom, would be for ever defeated if the American offer should be
accepted. Canada must not sell her birthright for a mess of Yankee
pottage.
The advocates of reciprocity denounced these arguments as the sheerest
buncombe. Annexation sentiment in the United States {266} they
declared to be rapidly disappearing, and in any case it was Canada's
views, not those of the United States, that mattered. Reciprocity from
1854 to 1866 had killed, not fostered, annexation sentiment in Canada.
And, if the doubling and trebling of imports from the United States in
recent years had not kept national and imperial sentiment from rising
to flood-tide, why now should an increase of exports breed disloyalty?
Canadian financiers and railway operators were entering into ever
closer relations with the United States; why should the farmer be
denied the same right? The reciprocity proposed in 1911, unlike the
programme of twenty years earlier, did not involve discrimination
against Great Britain, but in fact went along with a still greater
preference to the mother country. The claim that reciprocity would
kill imperial preference was meaningless in face of this actual fact.
Moreover, the British tariff reformers proclaimed their intention, if
Mr Chamberlain's policy prevailed, of making reciprocity treaties with
foreign countries as well as preferential arrangements with the
Dominions, so why should not Canada exercise the same freedom?
But elections are not won merely by such {267} debate. The energy with
which they are fought, or the weight of the interests vitally
concerned, may prove more decisive than argument. And in this contest
the Opposition had the far more effective fighting force and made the
far stronger appeal. Mr Borden's followers fought with the eager
enthusiasm which is bred of long exclusion from office, while the
ministerialists--save only the veteran prime minister himself and a
small band of his supporters--fought feebly, as if dulled by the
satiety which comes of long possession of the loaves and fishes.
Outside the party bounds the situation was the same. The western
farmers were the only organized and articulate body on the side of
reciprocity, while opposed to it were the powerful and well-equipped
forces of the manufacturers and the closely allied transportation and
financial interests. Through the press and from a thousand platforms
these forces appealed to the dominant beliefs and feelings of the
people. Quite effective was the appeal founded on the doctrine of
protection. In twenty years Canada had become a city-dominated land,
and the average city-dweller had come to believe that his interests
were bound up with protection--a belief not unnatural in the {268}
absence for a decade of any radical discussion of the issue, and not to
be overcome at the eleventh hour. But the patriotic appeal was still
more effective. Here was a chance to express the accumulated
resentment of half a century against the unneighbourly policy of the
United States, now suddenly reversed. The chance could safely be
seized, for Canada was prosperous beyond all precedent. 'Let well
enough alone' was in itself a vote-compelling cry. In fact, 'Laurier
prosperity' proved its own Nemesis. Jeshurun Ontario, having waxed
fat, kicked. An American philosopher, Artemus Ward, has recorded that
his patriotism was so worked up during the Civil War that he consented
to send all his wife's relations to the front. Many an Ontario patriot
in 1911 was prepared to sacrifice the interests of his fellow-Canadians
to prove his independence of the United States. And in Quebec the
working arrangement between the Conservatives and Mr Henri Bourassa and
his party told heavily against the Government.
The result of the elections, which were held on the 21st of September,
was the overwhelming defeat of Sir Wilfrid Laurier's Ministry. In
Ontario the Liberals saved only thirteen seats out of eighty-six. In
the rest of the {269} country they had a majority, but not sufficient
to reduce substantially this adverse Ontario vote. The complete
returns gave 133 Conservatives to 88 Liberals. As usual, the popular
vote was more equally divided than the parliamentary seats, for the
Liberals secured 625,000 and the Conservatives 669,000 votes. The
Liberal majority of only 5000 in Quebec, 3000 in the maritime
provinces, and 20,000 in the prairie provinces was overcome by the
Conservative majority of 63,000 in Ontario and 9000 in British
Columbia. A fortnight later Sir Wilfrid Laurier tendered his
resignation to the governor-general and Mr Borden formed his Government.
{270}