[2] The reason for the Government's action was clearly stated by Mr David Mills, minister of Justice, as follows: 'There were two things that presented themselves to the minds of the administration. One was to call parliament together and obtain its sanction for a proposition to send troops to South Africa. The other was to await such a development of public opinion as would justify them in undertaking to send the contingent ... the general sanction of the political sovereignty of this country from which parliament derives its existence. Now there was such an expression of opinion in this country as to justify the government in the course which they took.'—Senate Debate, February 6, 1900.

[3] The Australian representatives afterwards met with much difficulty in securing the consent of the Commonwealth parliament to this arrangement. A majority of the members who took part in the debate expressed the opinion that an Australian navy must sooner or later take the place of direct contributions.



{218}

CHAPTER XI

THE COMING OF PROSPERITY

The opening of the west—Railway expansion—State aids to production—New provinces and old cries—Party fortunes

We have seen that in the early years of the Laurier regime Canada attained a new international status and came to play no small part in the affairs of the Empire. No less notable in the succeeding years was the remarkable industrial expansion at home, the sunrise of prosperity which followed the long night of depression. This expansion touched every corner of the far-flung Dominion, and was based on the exploitation of resources and possibilities of the most varied kind. Yet the central fact, the development which caused and conditioned all the rest, was the settlement of the great western plains.

For years 'Canada's unequalled western heritage' had given many an after-dinner speaker a peroration, but it had given very few new settlers a living. The Conservative Government had achieved one great task of constructive patriotism, in providing for the {219} building of a railway across the vast wilderness to the Pacific. Over thirty million acres of the choicest lands of the West had been given to this and other railways to encourage settlement. A liberal homestead policy had been adopted. And still the settlers came not, or if they came they did not stay. Barely three thousand homestead entries a year were made in the early nineties. By 1896 the number had fallen to eighteen hundred. Canadians themselves seemed to have lost faith in the West, for in this year the applicants for homesteads included only five hundred and seventy settlers from the older Canada. The stock of the railway which had been built with such national effort had fallen to fifty. West of Lake Superior, after thirty years of Confederation, there were little more than three hundred thousand people, of whom nearly one-third were Indians. And, in the phrase of a western Conservative newspaper, 'the trails from Manitoba to the States were worn bare and brown by the waggon wheels of departing settlers.'

In the remarkable development of the West which now began, and which profoundly changed the whole outlook and temper of Canadian life, there were some general factors {220} with which statesmen or business men had nothing to do. The prices of farm products began to rise the world over, due in part to the swing of population in every land from country to city, and in part to the flooding supplies of new gold. The lessening of the supply of fertile free lands in the United States gave new value to Canada's untouched acres. Yet these factors alone would not have wrought the transformation. In the past, when Canada's West called in vain, low prices had not prevented millions of settlers swarming to the farms of the United States. Even of the Canadians who had migrated to the Republic, half, contrary to the general impression, had gone on the land. Nor was Canada now the only country which had vacant spaces to fill. Australia and the Argentine and the limitless plains of Siberia could absorb millions of settlers. In the United States itself the 'Great American desert' was being redeemed, while American railways still had millions of western acres to sell. Canada had the goods, indeed, but they needed to be advertised.

The new ministers at Ottawa rose to the occasion. They were not content to be 'merely flies on the wheel,' in Sir Richard {221} Cartwright's unlucky phrase of 1876. They adopted a vigorous and many-sided policy for the development of the West and of all Canada. The preferential tariff and the prime minister's European tour admirably prepared the way. The British people now regarded Canada with lively interest, and for the first time the people of the Continent began to realize the potentialities of this new northern land. The general impression thus created was followed up by more specific measures, aiming to bring in men and capital, to extend and cheapen transportation, and to facilitate production.

The call for settlers came first. Never has there been so systematic, thorough, and successful a campaign for immigrants as that which was launched and directed by the minister of the Interior, Mr, now Sir Clifford, Sifton. He knew the needs and the possibilities of the West at first hand. He brought to his office a businesslike efficiency and a constructive imagination only too rare at Ottawa. Through Continental Europe, through the United States, through the United Kingdom, with an enthusiasm unparalleled and an insistence which would not be denied, he sent forth the summons for men and women and {222} children to come and people the great plains of the Canadian West.

It was from Continental Europe that the first notable accessions came. Western Europe, which in earlier decades had sent its swarms across the sea, now had few emigrants to give. Falling birth-rates, industrial development, or governments' desire to keep at home as much food for powder as might be, had slackened the outward flow. But the east held uncounted millions whom state oppression or economic leanness urged forth. From Russia the Doukhobors or Spirit-Wrestlers, eager to escape from the military service their Quakerlike creed forbade, turned to Canada, and by 1899 over seven thousand of these people were settled in the West. Austrian Poland sent forth each year some four to six thousand Ruthenians, more familiarly known as Galicians. Both contingents brought their problems, but they brought also notable contributions to the western melting-pot. Their clannishness, their differing social ideals, the influence of religious leaders who sought to keep them a people apart, created political and educational difficulties of undoubted seriousness. But they turned to farm production, not to selling real {223} estate, and in a few years many came to appreciate and follow Canadian ways, for good or for ill. And if Doukhobor communistic practices or religious frenzy had their drawbacks, they served to balance the unrestrained individualism and the materialism of other sections of the community, and to add vast potentialities of idealism to the nation's store.

Much more significant, however, was the influx of American settlers, which reached a great height soon afterwards. Mr Sifton knew that no settlers could be had anywhere with more enterprise, capital, and practical experience of western needs than the farmers of the western and mid-western states. As these states became settled, many farmers who desired larger scope for their energy or farms for their growing sons were in the mood to listen to tales of pastures new. Among these Americans, then, the minister prepared to spread his glad tidings of the Canadian plains. Agents were appointed for each likely state, with sub-agents who were paid a commission for every settler who came. The land of promise was pictured in attractive, compelling booklets, and in advertisements inserted in seven or eight thousand farm and weekly papers. All inquiries were {224} systematically followed up. In co-operation with the railways, free trips were arranged for parties of farmers and for press associations, to give the personal touch needed to vitalize the campaign. State and county fairs were utilized to keep Canada to the fore. Every assistance was given to make it easy for the settler to transport his effects and to select his new home.

As a result of these aggressive efforts, the ranks of incoming Americans, negligible in the earlier years, rose to astounding proportions—from seven hundred in 1897 to fifteen thousand in 1900 and one hundred thousand in 1911. This influx had a decisive effect on the West. It was not only what these well-to-do, progressive settlers achieved themselves that counted, but the effect of their example upon others. Every American who preferred Canada to his own land persuaded an Englishman or a Scotsman that the star of empire was passing to the north.

Backed by this convincing argument, Mr Sifton now turned to the United Kingdom. For many years his predecessors had directed their chief efforts to this field. Early in the eighties a large influx of British and Irish immigrants had come, but most of them had quickly passed to the United States. In the {225} nineties scarcely ten thousand a year crossed from the crowded British Isles to Canada, while the United States secured thirty or forty thousand. Now conditions were soon reversed. The immigration campaign was lifted out of the routine and dry rot into which it had fallen. Advertisements of a kind new to British readers were inserted in the press, the schools were filled with attractive literature, and patriotic and philanthropic agencies were brought into service. Typical of this activity was the erection of a great arch of wheat in the Strand, London, during the Coronation ceremonies of 1902. Its visible munificence and its modest mottoes, 'Canada the granary of the Empire' and 'Canada offers 160 acres free to every man,' carried a telling message to millions. From nine or ten thousand in the nineties British immigration into Canada rose to fifty thousand in 1904 and over a hundred and twenty thousand in 1911. Australia soon followed Canada's example, with the result that whereas in 1900 only one of every three emigrants who left the British Isles remained under the flag, a dozen years later the proportions had grown to four out of every five. This was empire-building of the most practical kind.

{226}

This incoming of English-speaking peoples also brought its problems. The Americans contributed largely to the rise of the 'subdivision expert,' though in this matter of land speculation the native sons soon bettered their instructors. The British immigrants at first included too many who had been assisted by charitable societies, and always they flocked more to the towns than to the land. Yet these immigrants were in the main the best of new citizens.

During the fifteen years of Liberal administration (1896-1911) the total immigration to Canada exceeded two millions. Of this total about thirty-eight per cent came from the British Isles, twenty-six from Continental Europe, and thirty-four from the United States. This increase was not all net. There was a constant ebb as well as flow, many returning to their native land, whether to enjoy the fortune they had gained or to lament that the golden pavements they had heard of were nowhere to be seen. The exodus of native-born to the United States did not wholly cease, though it fell off notably and was far more than offset by the northward flow. After all deductions, the population of Canada during this period grew from barely over five to seven {227} and a quarter millions, showing a rate of increase for the last decade (1901-11) unequalled elsewhere in the world.

Closely connected with the immigration campaign was the Government's land policy. The old system of giving free homesteads to all comers was continued, but with a simplified procedure, lower fees, and greater privileges to the settler. No more land was tied up in railway grants, and in 1908 the odd sections, previously reserved for railway grants and sales, were opened to homesteaders. The pre-emption regulations were revised for the semi-arid districts where a hundred and sixty acres was too small a unit. Sales of farm lands to colonization companies and of timber limits were continued, with occasional excessive gains to speculators, which the Opposition vigorously denounced. Yet the homesteader remained the chief figure in the opening of the West. The entries, as we have seen, were eighteen hundred in 1896. They were forty-four thousand in 1911. Areas of land princely in their vastness were thus given away. Each year the Dominion granted free land exceeding in area and in richness coveted territories for whose possession European nations stood ready to set the world at war. In 1908, for {228} example, a Wales was given away; in 1909, five Prince Edward Islands; while in 1910 and 1911, what with homesteads, pre-emptions, and veteran grants, a Belgium, a Holland, a Luxemburg and a Montenegro passed from the state to the settler.[1]

After and with the settler came the capitalist. The vast expansion of these years was made possible by borrowing on a scale which neither credit nor ambition had ever before made possible. Especially from Britain the millions poured in as soon as Canadians themselves had given evidence of the land's limitless possibilities. The yearly borrowings from the mother country, made chiefly by national and local governments and by the railways, rose to a hundred and fifty millions. French, Dutch, Belgian, and German investors followed. American capitalists bought few bonds but invested freely in mines, timber limits, and land companies, and set up many factories. By the end of the period foreign capitalists held a mortgage of about two and a half billions on Canada, but in most cases {229} the money had been well applied, and the resources of the country more than correspondingly developed.

The railways were the chief bidders for this vast inflow of new capital. It was distinctly a railway era. The railway made possible the rapid settlement of the West, and the growth of settlement in turn called for still new roads. In the fifteen years following 1896 nearly ten thousand miles were built, two miles a day, year in and year out, and the three years following saw another five thousand miles completed. Two great transcontinentals were constructed. Branch lines innumerable were flung out, crowded sections were double-tracked, grades were lowered, curves straightened, vast terminals built, steamship connections formed, and equipment doubled and trebled.

In this expansion the state, as ever in Canada, took a leading share. The Dominion Government extended the Intercolonial to Montreal and began a road from the prairies to Hudson Bay, while the Ontario Government built and operated a road opening up New Ontario. The federal policy of aid to private companies was continued, with amendments. No more land-grants were given, and {230} when cash subsidies were bestowed, the companies so aided were required to carry free government mails, materials and men, up to three per cent on the subsidy. The transcontinentals were specially favoured. The Grand Trunk system was given large guarantees and cash subsidies for its westward expansion, and the Government itself constructed the National Transcontinental to ensure the opening up of the north, and to prevent the traffic of the west being carried to United States rather than to Canadian Atlantic ports. The Canadian Northern was assisted in its prairie construction by both federal and provincial guarantees. The Laurier Government aided the dubious project of building a third line north of Lake Superior, but refused to take any share in the responsibility or cost of building the much more expensive and premature section through the Rockies. The Borden Government and the province of British Columbia, however, gave the aid desired for this latter venture. Another important development was the establishment, in 1903, with the happiest results, of the Dominion Railway Commission, to mediate between railway and shipper or traveller.

{231}

The railway policy of this period is still matter for dispute. On the economic side, it is clear that the greater part of the construction was essential in order to open up the West, with all that this implied for both West and East. Yet there were many evils to set against this gain—the stimulus to unhealthy speculation, the excessive building in settled districts, the construction of roads ahead of immediate needs or possible traffic. The fact is that the railway policy was part and parcel of the whole business policy of the period, the outcome of the same new-born optimism which induced many a municipality to build pavements and sewers before the population warranted, or manufacturers to extend their plants too rapidly, or banks to open branches that did not pay. Progress comes in zigzag fashion; now one need is stressed, now another. To each time its own task, to each the defects of its qualities. And if in the reaction from unexampled prosperity some of the expansion seemed to have come before its time, most Canadians were confident of what the future would bring, and did not regret that in Canada's growing time leaders and people persevered in putting through great and for the most part needful works {232} which only courage could suggest and only prosperity could achieve.

On the political side, also, there were entries on both sides of the ledger. Campaign-fund contributions and political intrigue were the chief debit entries. Yet there were heavy credit entries which should not be forgotten. No other country has made the effort and the sacrifice Canada has made to bind its far-distant and isolated provinces in links of steel. The Intercolonial made the union of east and centre a reality, the Canadian Pacific bound east and centre and west, and the National Transcontinental added the north to the Dominion, gave the needed breadth to the perilously narrow fringe of settlement that lined the United States border. The national ends which Sir John Macdonald and Sir Wilfrid Laurier steadfastly held in view were so great and vital as to warrant risk, to compel faith, to justify courage.

In Canada the state, without much discussion as to the theory involved, has endeavoured to foster production in countless ways. The encouragement and sifting of immigration and the building or aiding of railways and canals are perhaps the most important {233} single forms this stimulus has taken; but they are far from the only ones. Farmer, miner, fisherman, manufacturer, artisan, all have been aided by policies more or less effective.

Under previous administrations the department of agriculture had done good work and had raised the standard of farm production. That work was now extended and re-vitalized. For the first time a farmer, Mr Sydney A. Fisher, took charge of the department. Better farming and better marketing alike were sought. On experimental farms and in laboratories, studies were carried on as to the best stock or plants, the best fertilizers or the best feeding-stuffs, to suit the varied soils and climates of the wide Dominion. By bulletins and demonstrations farmers were instructed in such matters as the selection of seed, the cool curing of cheese, the improvement of stock, the vigilant guarding against disease in herd and flock. Marketing received equal attention. For the fruit and dairy industries refrigerator-car services and cold-storage facilities on ocean ships were provided. In these and other ways the effort was made to help the Canadian farmer to secure full value for his toil.

The miner received less direct aid. {234} Railways built into mining areas, bounties on lead and petroleum, bounties on iron ore and steel products, laboratory studies in metallurgy, and reduction of the duties on mining machinery, all played a part in the great development of the mines of Canada which marked this era.

None too soon, an important step was taken in 1909 to ensure the perpetuation or the prudent use of the country's natural resources. In the early, lavish days men had believed these resources inexhaustible, or had recklessly ignored the claims of the future in their haste to snatch a fortune to-day. The United States had gone furthest on this path, and was the first to come to its senses. A conference held at Washington, in 1909, attended by representatives of the United States, Canada, Newfoundland, and Mexico—notable also as one of the first instances of Canada's recognition of the fact that she was an American power—recommended the establishment of a conservation commission in each country. Canada was the only country that acted upon the advice. The Conservation Commission was established that very year, with wide duties of investigation and recommendation. Under Sir Clifford Sifton as chairman and Mr {235} James White as secretary it has performed valuable and varied service.

The sea was given thought as well as the land. The fishing bounties already established were continued. Experts were brought from Europe to improve the methods of curing fish. Co-operative cold-storage warehouses for bait were set up, and a fast refrigerator-car service on both coasts brought fish fresh to the interior. Laboratories for the study of marine life and fish hatcheries came into being. Unfortunately, disputes arose as to jurisdiction between Dominion and provinces and between Canada and the United States, and the fisheries did not grow at the rate of other industries.

The manufacturer, however, continued to be the chief object of attention. An increase took place in the service of trade commissioners for Canada in other countries, whose duties are similar to those of a foreign consular service. The bounties on iron and steel production, amounting in all to twenty millions, undoubtedly did much to stimulate that industry. The protective tariff, as we have seen, remained in a modified form. After the notable step of 1897 towards a purely revenue tariff, there came a halt for some years. In fact, it seemed for a time that the pendulum {236} would swing towards still higher duties. In 1902 the manufacturers began a strong campaign in that direction, which was given aggressive support by the minister of Public Works, J. Israel Tarte, often termed by opponents of the Government the 'Master of the Administration.' This breach of ministerial solidarity Sir Wilfrid Laurier met, on his return from the Colonial Conference, by an instant demand for Mr Tarte's resignation. It was made clear that the compromise which had been adopted in 1897 would not be rashly abandoned. Yet the movement for a tariff 'high as Haman's gallows' continued, and produced some effect. It led (1904) to a reduction of the British preference on woollens and to an 'anti-dumping act'—aimed against slaughter or bargain sales by foreign producers—providing for a special duty when articles were sold in Canada for less than the prevailing price in the country of origin. In the same year Mr Fielding foreshadowed the introduction of a minimum and maximum tariff, with the existing duties as the minimum, and with maximum duties to be applied to countries which levied especially high rates on Canadian products. Only the vigorous opposition set up by the farmers of Ontario {237} and the West checked the agitation for still higher duties. The new tariff of 1907 made many careful revisions upward as well as downward, but on the whole the existing level was retained. Below the maximum or general rate, but higher than the British preference, there was set up an intermediate tariff, for bargaining with foreign states. This compromise tariff of 1907 remained in force with little change or strong agitation for change until three years later, when negotiations for reciprocity with the United States once more brought the issue to the front.

The field of social legislation, in which so many radical experiments have been made by other lands, in Canada falls for the most part to the provinces. Within its limited jurisdiction the Laurier Government achieved some notable results. Early in its career it put down sweating and made compulsory the payment of fair wages by government contractors. It set up a department of Labour, making it possible to secure much useful information hitherto inaccessible and to guard workmen's interests in many relations. Late in the Laurier regime a commission was appointed to study the question of technical education, important alike for manufacturer {238} and for artisan. The most distinctive innovation, however, was the Lemieux Act, drawn up by W. L. Mackenzie King, the first deputy minister of Labour. This provided for compulsory investigation into labour disputes in quasi-public industries. It proved a long step towards industrial peace, and was one of the few Canadian legislative experiments which have awakened world-wide interest and investigation.

The growth of the West made it necessary to face the question of granting full provincial powers to the North-West Territories. Originally under the direct rule of the Dominion parliament, step by step they had approached self-government. In 1886 they had been given representation at Ottawa; in 1888 a local legislature was created, with limited powers, later somewhat enlarged; and in 1897 the Executive Council was made responsible to the legislature. Now, with half a million people between Manitoba and British Columbia, the time had come to take the last step. And so in 1905 the Autonomy Bills, establishing the provinces of Alberta and Saskatchewan, were brought before the House of Commons by the prime minister.

{239}

There were many controversial issues involved. How many provinces should be created? Two were decided upon, to comprise the area south of the sixtieth parallel; the area to the north was left in the territorial status. What should be the capitals? Provisionally Edmonton and Regina were selected. Should the provinces be given control of crown lands? Notwithstanding some opposition, it was decided to maintain the policy, in force from the first acquisition of the West, of keeping the lands in control of the Dominion, which also had control of immigration. What financial aid should be given? Liberal grants were provided, accepted by all parties as fair and adequate. What legislative powers should the provinces be given, particularly on the subject of education? This proved a thorny question. It provoked a storm of heated controversy which for a brief time recalled the days of the Jesuits' Estates and Manitoba school questions.

A clause in the bills, which Sir Wilfrid Laurier introduced in February 1905, provided: first, that Section 93 of the British North America Act, safeguarding minority privileges, should apply; secondly, to make it clearer what these privileges were, it stipulated that {240} the majority of the ratepayers in any district might establish such schools as they thought fit, and that the minority, whether Protestant or Catholic, might also do so, being in that case liable only for one set of school rates; and thirdly, that legislative appropriations should be divided equitably between public and separate schools.

Three main questions arose. Were separate schools desirable in themselves? Was there any obligation, legal or moral, to establish or maintain them? If so, what form should they take?

Introducing the bills, Sir Wilfrid stated that he 'never could understand what objection there could be to a system of schools wherein, after secular matters had been attended to, the tenets of the religion of Christ, even with the divisions which exist among His followers, are allowed to be taught.' He went on to contrast the schools of Canada, wherein Christian dogmas and morals were taught, with those of the United States, where they were not taught, and to point out the resulting difference in moral standards as witnessed by lynching, murder, and divorce statistics.

The great majority of Catholics and a {241} minority of Protestants, or their ecclesiastical spokesmen, regarded the school as a means of teaching religion as well as secular subjects, and wished secular subjects, where possible, to be taught from a distinctly religious point of view. A small minority were in favour of complete secularization of all schools. The majority of Protestants would probably have favoured some non-denominational recognition of religion in the schools, and would judge denominational teaching by the test of how far this would involve herding the children apart and putting obstacles in the path of educational efficiency and of national unity.

But was parliament free to grant the provinces the liberty to decide the question solely in accord with what the majority might now or hereafter think expedient? On the one hand, it was vigorously contended that it was free, and that any attempt to limit the power of the province was uncalled for, was an attempt to petrify its laws, and to revive the coercion which Sir Wilfrid Laurier himself had denounced and defeated in 1896. The recognition of separate schools in the British North America Act, the critics continued, applied only to the four original provinces, and there was probably no power, and {242} certainly no legal obligation, to extend the principle to the West. On the other hand, it was argued that Section 93 of the British North America Act—introduced at the instance of the Protestant minority of Quebec, and designed to protect the interest of all minorities—morally and legally bound the whole Dominion; that the Manitoba Act of 1870 confirmed the principle that the Dominion could give a new province only such powers as the constitution provided, which meant control over education subject to the minority's privilege; and that parliament, by unanimously establishing separate schools in the North-West Territories in 1875, had still further bound its successors, or at least had shown how the Fathers of Confederation interpreted the constitution.

To many, however, the abstract questions of separate schools and the constitution were less important than the practical question, What kind of schools were to be guaranteed by these bills? Sir Wilfrid Laurier declared that the school system to be continued was that actually in force in the North-West, which had been established under the clause respecting schools of the Dominion Act of 1875, which the present bills repeated word for word. {243} This system worked very satisfactorily. It gave Catholic and Protestant minorities the right to establish separate schools, and to pay taxes only for such schools. In all other respects the school system was uniform; there was only one department of education, one course of study, one set of books, one staff of inspectors. No religious teaching or religious emblems were permitted during school hours; only in the half-hour after the close of school might such teaching be provided. The separate schools were really national schools with the minimum of ecclesiastical control.

It soon became apparent, however, that the schools then existing in the North-West, though based on the Act of 1875, were much less ecclesiastical in character than the act permitted, and less ecclesiastical in fact than the schools which had formerly existed in the territories. In 1884 the Quebec system had been set up, providing for two boards of education, two courses of study, two staffs of inspectors, and separate administrations. But in 1892 this dual system had been abolished by the territorial legislature, and in 1901 the existing system had been definitely established by a series of ordinances. To meet the {244} objections urged, the new bills were amended to make it clear that it was the limited separate school system established in 1901 that was to be continued, and not a complete separate system as authorized in 1875. The bills as originally drafted virtually gave the Church complete control over separate schools, but, as now amended, control over religious education only.

The measure was hotly debated, inside and outside parliament. Particularly in Ontario the original bills were denounced by many Liberals as well as Conservatives as oppressive, reactionary, and a concession to the hierarchy. The West itself was not disturbed, and the Protestants of Quebec acquiesced in the recognition of separate schools. Mr Sifton made the measure the occasion for resigning from the Ministry. The controversy was a great surprise to Sir Wilfrid, who had considered that he was simply carrying out the agreement reached unanimously in 1875. The amendment satisfied all the malcontents of his party in parliament, but the controversy continued outside. The more extreme opponents of separate schools would see no difference between the new clause and the old. Archbishop Langevin strongly denounced the {245} amendment; but the fire soon cooled. Today fewer than one school in a hundred in the two provinces is a separate school.

Throughout this period of rapid growth the Liberal party maintained its place in power. The country was prosperous and content and the party chieftain invincible. The general elections of 1904 turned chiefly on railway issues. The criticisms of the Opposition, many of them well grounded, proved unavailing. The contest ended in a victory for the Government with a majority of sixty seats in the House and of fifty thousand votes in the country. The results presented the usual discrepancies between electoral votes and parliamentary representation. Though the Liberals had only 54,000 votes in Nova Scotia, as against 46,000 for the Conservatives, they captured all the eighteen seats. Prince Edward Island, giving the Liberals a popular majority, returned three Conservatives to one Liberal. Ontario cast 217,000 Conservative and 213,000 Liberal votes and returned forty-eight Conservatives and thirty-eight Liberals. An untoward incident of the elections was the defeat of Mr R. L. Borden in Halifax. The leader of the Opposition had won universal respect, {246} and it was to the satisfaction of opponents as well as followers that another seat was shortly found for him.

In the general elections of four years later (1908) no single issue was dominant. The Opposition alleged 'graft' and corruption, and charged ministers and ex-ministers with breach of the eighth and neighbouring commandments. Government officials, too, they said, were guilty of extravagance and fraud. Timber limits, contracts, land deals, figured in still further scandals. The ministerial forces replied in the usual way, claiming in some cases that there was no ground for the allegations, and in others that they themselves had intervened to put a stop to the practices inherited from previous administrations. They carried the war into Africa by counter-charges against leading members of the Opposition. The air was full of scandals and personalities; but none of the charges were of sufficient magnitude or sufficient certainty to weigh heavily against the prosperity of the country and the personality of the prime minister. The parliamentary majority, however, fell from sixty-two to forty-seven, and the popular majority from fifty to twenty thousand.

{247}

The years had brought many changes in the Ministry. Mr Sifton had retired, Mr Tarte's resignation had been accepted, and Mr Fitzpatrick had gone to the Supreme Court. Mr Oliver had succeeded Mr Sifton, Mr Aylesworth had come from a distinguished place at the bar to the portfolio of Justice, Mr Pugsley was in charge of Public Works, Mr Graham had left the leadership of the Ontario Opposition for the portfolio of Railways, Mr Mackenzie King had jumped from the civil service to the Cabinet, and Mr Lemieux and Mr Brodeur were the prime minister's chief colleagues from Quebec. The Opposition benches showed almost as many changes. Of the former Conservative ministers, Mr Foster and Mr Haggart only remained in active service, while Mr Doherty, Mr Ames, and Mr Meighen were among the more notable accessions. Some rumbles of discontent were heard against Mr Borden's leadership, but the party as a whole rallied strongly to him, and his position both in the party and in the country grew increasingly firm.

Through all the changes the prime minister grew in strength and prestige. Each year that passed gave proofs of his masterful leadership. {248} The old cry that he was too weak to rule now gave way to the cry that he was too strong. There was no question that for all his suavity he insisted upon being first minister in fact as well as in form. In Canada he had a hold upon the popular imagination which had been equalled only by Sir John Macdonald, while abroad he was the one Canadian, or in fact the one colonial statesman, known to fame, the outstanding figure of Greater Britain.



[1] It is estimated that 15 per cent of the Scottish, 18 per cent of the English, 19 per cent of the Irish, 27 per cent of the Continental, and 30 per cent of the United States immigrants made entry for homesteads. The proportion of Americans who bought land was in still greater degree much the largest.



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CHAPTER XII

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}

CHAPTER XIII

NATION AND EMPIRE

Imperial preferential trade—Political relations—Defence

Neither new relations with foreign lands across the sea nor new-old relations with the United States bulked as large in these later years as relations with the other parts of the British Empire. The question of the Empire's future was a constant theme. It was a time of unparalleled progress in each and all the British states. Great Britain's vast strides towards social justice, Canada's growth and economic activity, the similar, if lesser, expansion of Australia and New Zealand, the unification of South Africa, all bespoke the strength and soundness of each of the Five Nations. The steady growth of community of feeling and of practical co-operation in many fields bore witness that progress did not mean disunion.

Yet there were many at home, and in Great Britain and the other lands overseas, who were far from content with the trend of events, who {271} were convinced that the Empire was drifting to eternal smash unless some change in policy should be effected. To some it was Britain's free-trade policy that was the danger; to others it was the steady growth of self-government in the Dominions. Imperial preferential trade, political federation, colonial contributions to a central army and navy, were all vigorously urged as remedies. Not one of these things came to pass in the years under survey, and yet when the testing-time arrived the Empire proved one in heart and soul.

Great Britain's free-trade policy was first called in question. Scarcely ended were the Boer War and the disappointing Conference of 1902 when Mr Chamberlain, fresh from a tour through South Africa, launched his great campaign for imperial preferential trade. Though protection and retaliation later became more important phases of the tariff-reform movement, at the outset it was its imperial side which was emphasized. The colonies and the mother country, it was urged, were certain to drift apart unless bound by links of material interest. Give the colonies a preference on their wheat or wool in Britain, give British {272} manufacturers a real preference in colonial markets, and the Empire would cease to be merely a sentiment.

Once committed to setting up a protective tariff in order to make reductions in favour of such colonies as would reciprocate, Mr Chamberlain and his followers went on to find in it other great advantages. It would aid British agriculture and British industry, would protect both farmer and manufacturer from the competition they were increasingly unable to bear, and would give a weapon for forcing foreign countries to tear down their tariff barriers. The colonial market, the home market, and the foreign market would thus all be gained, and none too soon, if the complete decay of British industry and the triumph of its rivals were to be averted. 'We have reached our highest point,' declared Mr Chamberlain. 'Our fate will be the fate of the empires and the kingdoms of the past.... Sugar has gone, silk has gone, iron is threatened, wool is threatened, cotton will come.... We are no longer first. We are third. We shall be fifth or sixth if things go on as they are at present.... The trade of this country, as measured by the exports to foreign countries and to British possessions, {273} has during the last twenty or thirty years been practically stationary; our export trade to all these foreign countries which have arranged tariffs against us has enormously diminished, and at the same time their exports to us have enormously increased.'

For a time it seemed that the tariff reformers would sweep all before them. Their chief was the most skilful and popular leader of his time. The inevitable growth of other countries in manufacturing had excited the alarm of the British manufacturer, and protectionist sentiment among the landowners, though scotched, had not been killed. The almost universal reign of protection in foreign countries and the other colonies appeared to prove obsolete the doctrines of Cobden and Bright. It seemed that fifty years of unquestioned triumph in England itself had left free trade a traditional dogma, not a living belief. To the poor, tariff reform promised work; to the rich, a shifting of heavy taxation from their shoulders; to the imperialist, the indissoluble empire of his dreams.

Yet the pendulum soon swung against Mr Chamberlain. Investigation showed that his jeremiads were largely unfounded, and gave new life to the principles of free trade. They {274} were shown not to be obsolete dogmas, but reasoned deductions from the actual situation of the United Kingdom. Imperial preference meant a crippling tax on food and on raw materials for no adequate return. The share of colonial markets which British manufacturers did not have, for which they could compete, and which colonial producers did not desire to keep themselves, was very small. Mr Chamberlain was stricken soon after with lingering illness, and of the younger men of capacity who came upon the scene practically all were on the side of free trade. The stars in their courses fought against him, for, from 1903 onward, British trade began to flourish as never, or rarely ever, before. In the elections of 1906, though other issues were also factors in the result, the sweeping victory of the Liberals was mainly a triumph for free trade.

In Canada, also, at the outset, Mr Chamberlain's proposals were widely welcomed. He was personally popular. The majority of Canadians believed in protection. Some of those who did not were ready to recognize the value of a preference in the British market. Yet as the full implications of the proposal became clear, and as the British free-trader made good his case, opinion in Canada became {275} as divided as in Great Britain. It was realized that it was one thing for Canada to give a reduced tariff, leaving the fiscal system protective still, and quite another for Great Britain to abandon entirely her free-trade policy in order to be able to give preferential rates to colonies or to low-tariff foreign states. Canadian manufacturers gave the movement a warm but vague welcome; it soon became clear that Mr Chamberlain was much mistaken in supposing they were prepared to relinquish any corner of the Canadian market to British manufacturers. They declared officially that they would not favour an increase in the British preference even on articles not made in Canada: 'we were not prepared to admit that there was any article that could not at some point in Canada, and in time, be successfully manufactured.'[1] They were, however, fully prepared to give British manufacturers lower rates than American, provided that both rates were high enough. The farmer, who chiefly was to profit, did not appear eager for the boon of a preference in the British market, so far as farm journals and farmers' organizations represented his view. He would be glad {276} to have higher prices for his wheat or stock, but did not want the British workman to pay a halfpenny a loaf to bribe him to remain in the Empire.

To some extent opinion followed party lines. The Conservative party had consistently supported reciprocal preference and opposed the Laurier-Fielding free gift. The Liberals had defended that preference as in itself a benefit to the Canadian consumer, and had deprecated higgling with Great Britain. They would be glad to receive a preference in Great Britain if Britain felt it in her own interest. Convinced believers in self-government for themselves, however, they were willing that the United Kingdom should have the same privilege, and declined to intervene in the British campaign. Mr Borden took the same stand as to intervention; but many of his followers were not hampered by such scruples, and Mr Foster made eloquent speeches in England on Mr Chamberlain's behalf.

The Conference of 1907 was essentially an appendix to the Chamberlain campaign. Imperial preference found vigorous advocates among colonial prime ministers, notably Dr Jameson of the Cape, Mr Ward of New Zealand, and especially Mr Deakin of Australia, {277} whose eloquent appeal was one of the chief features of the Conference. All expressed themselves as not wanting the United Kingdom to set up a protective and preferential system unless convinced it was for her own good; but with more persistence than success they sought to prove that it would be for her good, and especially to show that prices to the English consumer would not be increased, and yet that colonial producers would gain. The representatives for the United Kingdom, ministers in the British Government, fresh from a three-year discussion of the whole issue and backed by the largest parliamentary majority on record, were equally frank in their rebuttal of the arguments advanced and their refusal to lead Britain to commit what they considered commercial suicide. Mr Asquith and Mr Churchill were especially uncompromising; Mr Lloyd George showed more temperamental sympathy with protection in the abstract, but was equally clear that free trade had been proved best for Great Britain beyond question.

Sir Wilfrid Laurier was the doyen of the Conference, the only member present for a third time. He took a less vigorous part than in the previous meetings, letting the younger {278} lions roar. He had opened the debate by announcing his intention to move again the preference resolutions of 1902, and did so in a brief speech at the close, making his position clear. Canada had given a free preference to British goods deliberately, and had not repented. If it had not done for the British manufacturer all that he would like, more could be done by a system of mutual preference. 'Yet this is a matter,' he continued, 'that is altogether in the hands of the British people, and if they think on the whole that their interests are better served by adhering to their present system than by yielding ever so little, it is a matter for the British electorate. I think the best way of serving the whole is by allowing every part to serve and recognize its own immediate interests.' On his motion the resolutions of 1902—recognizing the value of preferential trade, declaring free trade between the different parts of the Empire impracticable, urging the colonies to follow Canada's example in giving a preference to the United Kingdom, and urging the United Kingdom to consider the expediency of granting a preference to colonial products, either by an exemption from or reduction of duties now or hereafter imposed—were adopted by {279} all the Dominions, the United Kingdom dissenting. Sir Wilfrid laid more stress upon the proposal for an All-Red line of steamers for faster and better service on the Atlantic and on the Pacific, with joint subsidies, urging that the best way to bind the Empire together was to facilitate intercourse. The proposal was received with enthusiasm; yet, though its advocacy was continued by Lord Strathcona and Mr Sifton, little progress was made towards its adoption.

After the Conference of 1907 preferential trade ceased for a time to be a living issue. Social reform, the budget controversy, the struggles with the House of Lords, Home Rule, foreign affairs, in turn took the leading place on the stage. Four years later, at the Conference of 1911, the subject was not even mentioned. The Unionist party was now definitely pledged to protection on manufactures, but the tax on food, essential to effective colonial preferences, had been thrown overboard by a large section of the party. The British farmer was promised land reform instead of protection on foodstuffs. Even Mr Bonar Law, speaking in 1912, declared that he did not wish to impose food duties, and would impose them only if, in a conference {280} to be called, the colonies declared them to be essential. This endeavour to throw on the colonies the onus and responsibility of making the Englishman pay food taxes was denounced on every side, and after much shuffling a compromise was reached to the effect that 'if when a Unionist Government has been returned to power it proves desirable, after consultation with the Dominions, to impose new duties upon any articles of food, in order to secure the most effective system of preference, such duties should not be imposed until they have been submitted to the people of this country at a general election.'

Thus, after ten years of ardent agitation for tariff reform, one great party in the state was as resolutely opposed to the scheme as ever, and, while the other was committed to it, the duty on foodstuffs, once declared essential to save the Empire, was made conditional and given second place to protection of manufacturers. It was by no means improbable that the whirligig of time would once more bring to the front food taxes and imperial preference. Yet as far as the early years of the century went, the years within which Mr Chamberlain declared that the decision had to be made, no step towards preference had {281} been taken by Great Britain, and still the Empire drew closer together instead of drifting apart. As a matter of fact, the empire-binding value of tariff preference was greatly exaggerated by its advocates. The Laurier-Fielding preference was a real bond of imperial unity simply because it was a free-will offering, given from motives of sentiment, not of profit. A system of preferences such as Mr Chamberlain advocated might possibly be a good business arrangement for one or all of the countries concerned, but it could have little force as empire-cement. It would be a matter of cold-blooded bargain, on a par with the similar reciprocal or preferential arrangements which the protectionists proposed to make with foreign countries. There would be nothing exclusive about it.

Good came of the agitation. It compelled a bed-rock consideration of British business and social conditions, and proved that if free trade had made possible the production of great wealth, it had not been enough to ensure its fair distribution. This searching inquest was largely responsible for the great series of democratic and social reforms adopted by the Asquith Government, reforms which gave the United Kingdom the world's leadership in {282} democracy and won fresh sympathy and loyal emulation in the Dominions. In undying words Mr Asquith gave (1909) a definition of Liberalism which awoke immediate sympathy in every Dominion. It expressed in concentrated form ideals which more and more would be the common heritage of all the Empire, particularly in those Dominions, such as Australia and Canada, where all parties are almost equally democratic and progressive:

As regards the Empire, to secure full unity by allowing the greatest diversity and the fullest liberty of self-government in all its parts.

As regards property, to make it secure by divesting it from injustice.

As regards political authority, to make it stable by resting it on the broadest possible basis of popular responsibility.

As regards religion, to remove it from the odium of alliance with political disabilities.

As regards trade, to make it world-wide by opening our own markets here at home to everybody.

And, finally, as regards the liberty of the individual citizen, to make it a reality instead of a sham, by universal education and by an ever-rising standard of humane conditions both in the factory and the home.

We have now to review briefly the discussions which went on during these years in {283} respect to the political relations of the different states of the Empire. Broadly speaking, two schools or tendencies existed. One favoured the retention of the powers of self-government already acquired by the Dominions and the taking up of still further duties, while at the same time aiming at full co-operation and harmony in matters of essential common interest. The other, declaring that the tendency towards self-government had already gone too far and would if continued lead to the disruption of the Empire, advocated setting up some central council or parliament with legislative and executive control over the whole Empire, within limitations more or less wide. One stood for a free alliance and co-operation, the other for organic or federal union and centralization. These two theories of empire did not, in Canada, become party creeds; but, on the whole, Liberals were sympathetic with free alliance, while centralization drew most of its support from Conservative ranks. On some issues, however, there was an approach to unanimity, and on others the division cut across party lines.

In domestic affairs self-government was almost entirely won. Some survivals of the {284} old colonial subordination remained in the formal inability of Canadians to amend their own constitution and in the appeal from the decisions of Canadian courts to the Judicial Committee of the Privy Council—limitations which had been wholly or mainly removed in the case of the newer Commonwealth of Australia. But the long-contested control over copyright was finally conceded, and the Hutton and Dundonald incidents led to the clearer recognition that if imperial officers entered the military service of the Dominion they were, precisely as in the United Kingdom, under the control of the responsible civil ministers. The provision that the commander of the militia must be a British officer was dropped in the revision of the Militia Act in 1904. In the words of Mr, now Sir Robert, Borden in 1902, words which became increasingly true as years went by; 'Step by step the colonies have advanced towards the position of virtual independence so far as their internal affairs are concerned, and in all the important instances the claim has been made by Canada, has been resisted at first by the imperial statesmen, and finally has been conceded, and has proved of advantage both to the Mother Country and to the colonies.'

{285}

In foreign affairs self-government came more slowly, in the face of greater opposition, but still steadily and surely. Its coming was more imperceptible; in fact, many Canadians continued to believe that they had no voice in the control of foreign policy, and made on this very ground a strong plea either for setting up some central authority in which they would have representation, or else for declining to take any part in imperial wars because they had not and could not have a real voice in imperial policy.

This belief was well founded, so far as concerned part of the field of foreign affairs, but it failed to recognize the striking advance made in other areas. We were like M. Jourdain of Moliere's comedy, who was surprised to find that he had been talking prose all his life without knowing it. We had been carrying on a steadily increasing part of our foreign affairs without consciously labelling them as such. For to-day foreign affairs are largely commercial affairs, questions of trade and tariff, of immigration and transportation, of fishery or power or navigation rights. And it is largely with contiguous countries that the most important questions arise. Now, as has been seen from the review of relations with {286} the United States and other foreign countries in an earlier chapter, Canada had come to have all but complete control of such affairs.

In 1909, following Australia's example, Canada established a department of External Affairs for 'the conduct and management of international or intercolonial negotiations, so far as they may appertain to the government of Canada.' In introducing this measure Sir Wilfrid declared: 'All governments have found it necessary to have a department whose only business will be to deal with relations with foreign countries.... We have now reached a standard as a nation which necessitates the establishment of a Department of External Affairs.' On Sir Robert Borden's accession to power one of his first steps was to increase the importance of this department by giving it a minister as well as a deputy, attaching the portfolio to the office of the prime minister. For other purposes special envoys were sent, as when Mr Fielding negotiated trade relations in France and in the United States, or Mr Lemieux arranged a compromise with the government of Japan upon the immigration issue. In these cases the British ambassador was nominally associated with the Canadian envoy. Even this formal {287} limitation was lacking in the case of the conventions effected with France, Germany, Holland, Belgium, and Italy in 1909-10, by negotiation with their consuls in Ottawa. Finally, in the Waterways Treaty with the United States, the international status of Canada was for the first time formally recognized in the provision that the decision to submit to arbitration matters other than those regarding boundary waters should be made on the one hand by the President and Senate of the United States, and on the other by the Governor-General in Council, the Cabinet of the Dominion.

At the close of this period, then, every phase of our foreign relations so far as they concerned the United States, and an increasingly large share of our foreign relations with other powers, were under Canadian control. It remained true, however, that Canada had no voice in determining peace and war. In other words, it was with Britain's neighbours, rather than with Canada's neighbours, that any serious war was most likely to come. Diplomatic policy and the momentous issue of peace or war in Europe or Asia were determined by the British Cabinet. In this field alone equality was as yet to seek. The {288} consistent upholder of Dominion autonomy contended that here, too, power and responsibility would come in the same measure as military and naval preparation and participation in British wars. Just as Canada secured a voice in her foreign commercial relations as soon as her trade interests and industrial development gave her commercial weight, so a share in the last word of diplomacy might be expected to come almost automatically as Dominion and Commonwealth built up military and naval forces, or took part in oversea wars.

In this conception the Crown became the chief visible link of Empire. Autonomists believed that 'His Majesty's Government' should remain a manifold power. 'We all claim to be His Majesty's Government,' declared Sir Wilfrid at the Conference of 1907. The Government at Sydney was as much His Majesty's as the Government at Westminster. The Canadian Privy Council was as much His Majesty's as the Privy Council of the United Kingdom. The tendency in the Dominions had been to magnify the powers of the king, who was equally their king, and to lessen the powers of the parliament elected in the United Kingdom. In fact the Crown became, if the metaphor is not too homely for such great {289} affairs, a siphon which transferred power from His Majesty's Government in the old land to His Majesty's Governments in the Dominions.

It was, however, not enough to have independent control. It was equally necessary, as the other half of the policy of co-operation, to provide means for securing united and effective action. These were provided in many forms. High commissioners and agents-general became increasingly important as ambassadors to London. Departments of External Affairs ensured more constant and systematic intercourse. Special conferences, such as the Naval Conference of 1909 in London, or the several exchanges of visits between the Australian and the New Zealand ministers, kept the different states in touch with each other. But by far the most important agency was the Colonial or Imperial Conference, now a definitely established body, in which Dominions and Kingdom met on equal footing, exchanged views, and received new light on each other's problems. Thus the question of co-operation between the Five Nations became much like the problem which faces any allies, such as those of the Triple Entente, save that in the case of the British Empire the alliance is not transitory and a {290} common king gives a central rallying-point. Nowhere has this free form of unity, as unique in political annals as the British Empire itself, received clearer expression than in the words of Edward Blake in the British House of Commons in 1900:

For many years I for my part have looked to conference, to delegation, to correspondence, to negotiation, to quasi-diplomatic methods, subject always to the action of free parliaments here and elsewhere, as the only feasible way of working the quasi-federal union between the Empire and the sister nations of Canada and Australia. A quarter of a century past I dreamed the dream of imperial parliamentary federation, but many years ago I came to the conclusion that we had passed the turning that could lead to that terminus, if ever, indeed, there was a practicable road. We have too long and too extensively gone on the lines of separate action here and elsewhere to go back now. Never forget—you have the lesson here to-day—that the good will on which you depend is due to local freedom, and would not survive its limitation.

But to many this trend of affairs was far from satisfactory. They urged that Canada should retrace her steps and take the turning that led to imperial parliamentary federation. This agitation was carried on chiefly in private circles and through the press. One organization after another—British Empire League, {291} Pollock Committee, Round Table—undertook earnest and devoted campaigns of education, which, if they did not attain precisely the end sought, at least made towards clearer thinking and against passive colonialism. Occasionally the question was raised in parliament. Typical of such debates was that of March 13, 1905, when Colonel, now General Sir Sam, Hughes moved a resolution in favour of parliamentary federation. Mr Borden refrained from either opposing or approving the motion, but, as did other members of his party, made it a starting-point for a speech in favour of imperial preference. Sir Wilfrid Laurier declared:

I do not think that it would be possible to find in any of the self-governing colonies any desire or any intention to part with any of the powers which they have at the present time. At present we are proud to say and to believe that the relations of the British Empire, within all its parts, are absolutely satisfactory.... It is not in accordance with the traditions of British history, it is not in accordance with the traditions of the Anglo-Saxon race, to make any change in their institutions until these institutions have been proved insufficient or defective in some way.... The British Empire to-day is composed of nations, all bearing allegiance to the same sovereign.

At the Conference of 1907 it was proposed {292} that the Colonial Conference be changed into an Imperial Council. This suggestion met support from various quarters, but was blocked by Sir Wilfrid's firm opposition. He agreed heartily that the Conference should be styled Imperial rather than Colonial, but, backed by all his colleagues, opposed any attempt to turn the Conference into a Council, with independent powers and an overwhelming representation from the United Kingdom. In fact the Conference was established more firmly than ever on a basis of equality. The prime minister of the United Kingdom, rather than the colonial secretary, became the special representative of his country, and the Conference was declared to be 'between His Majesty's Government and His Governments of the self-governing Dominions overseas.'