DOSSIER 4 – THE EFFECTS OF ECONOMIC DEVELOPMENT SINCE 1867 Mr. Wilson - History 404

Industrialization and the West

What happened In 1867?  Confederation  New Brunswick and Nova Scotia joined the Canadian Confederation based on the promise of being connected to Ontario and Quebec’s railroad.  The railroad was an extremely important economic factor in the early years of Confederation – leading to creation of the Western Provinces.

What is PROTECTIONISM?  PROTECTIONSIM is an economic policy that protects local business from outside competition. Usually through the use of tariffs, customs and duties.  What is the opposite of PROTECTIONSIM? Free Trade  England had adopted a Free Trade policy just before confederation, which forced Canada into the 10 year Reciprocity Treaty with the U.S. in  This meant that the neither of us had to pay tariffs or duties on goods going back and forth.

Economic Development  Until the 19 th century, Canada’s economy was largely based on the Primary Sector: Fishing, lumber and agriculture.  After 1850 and the introduction of INDUSTRIALIZATION, Canada started to expand into the Secondary and Tertiary Sectors.

The Primary Sector  In the 19 th Century Canada was barely ably to feed its population.  But with the introduction of industrialization and mechanized agriculture – we started to have a surplus.  The next major change was ELECTRICITY.

The Primary Sector  After WWII ( ) electricity became a common necessity for every household.  This had an impact on agriculture, specifically in that the number of farms decreased while the production increased. Number of people needed to run a farm The overall production of each farm

The Primary Sector  Although agriculture was changing, other sectors opened up.  Forestry still offered plenty of employment.  At the end of the 19 th century several mines started to open: Nickel, Gold, Silver, Copper in Abitibi-Temiscamingue Asbestos in the Eastern Townships Iron in Cote-Nord Copper in Gaspesie

The Secondary Sector  At first industrialization in the 19 th century only effected the industries producing everyday necessities: shoes, clothing, tobacco, milk, butter, cheese, sugar, beer, etc.  But by the 20 th century, more export-oriented light industries were being developed: Pulp and paper, newsprint Ore processing Chemical products Transportation materials (mostly for railroads)

The Secondary Sector  Since the 1970’s however, the proportion of secondary sector industries has decreased.  This is largely due to the competition being generated in other countries where labour is cheaper.  Basically, or high Standard of Living is working against us.

Hydroelectricity  The Development of hydroelectricity in Quebec gave Quebec an advantage for the development of new industries.  Because of Quebec’s POTENTIAL for such stations, the first hydroelectric stations were built in the 19 th century  At first stations were privately owned and operated for individual projects and industries – selling their power at whatever price.

Hydroelectricity  Hyrdo Quebec was nationalized in 1963 in order to control the price of electricity which was considered a necessity (like education or Medicare.)  By the 1970’s Quebec was the world leader in the construction of hydroelectric stations.  All this cheap energy makes Quebec an extremely attractive place to set up industries – especially in the secondary sector.  However, such stations have large environmental ramifications.

Manic-Outardes Complexes

La Grande Complex

The Tertiary Sector  Throughout the 20th century as the Tertiary Sector started to grow, a new kind of job was created – THE OFFICE WORKER.  Industrialization led to more consumption, which led to more jobs and so on.  As the population grew, so did the need for SOCIAL SERVICES, which in turn created even more office jobs.  However, jobs in the tertiary sector did not necessarily pay better – so at first office workers were generally women.

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Concentration of Capital  By the end of the 19 th century, most of the major industries were owned and operated by a few privileged Anglophones.  The best example for this were the original banks.  The banks loaned out capital for the creation and expansion of companies. Therefore they were an integral part of the economic development.  But there were only a few banks and a few Anglophones therefore controlled most of the capital – this problem was only rectified after WWI.

Economic Cycles  All economies go through a periods of growth and recession (see figure 2.35 on page 85)  The main periods of growth are as follows: 1867 – 1929 Growth The Great Depression 1945 – 1973 The Baby Boom 1973 The Energy Crisis 1981 and some other short recessions

Early Industrialization

Economic Prosperity = the Roaring 20’s

The Great Depression

World War II

The 1950’s and the1960’s

The Energy Crisis 1973

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Economic Policies  Before the Great Depression, the Canadian government rarely interfered with economics.  In 1934, the Bank of Canada was created to control credit and therefore INLFATION – in the hopes of steadying the economy.  The Federal government also implemented programs such as Unemployment Insurance (or EI)  The idea was to insure the minimum welfare of our citizens.  This welfare state is supported by things like Income Taxes.

Economic Policies  In Quebec, certain agencies were also created to help out: L’Office du Credit Agricole 1936 – made small loans for the creation of farms. Regie des Rentes du Quebec 1965 – for retirement pensions and family allowances. Caisse de Depot et de Placement du Quebec 1965 – for managing the investments of the Quebec goevrnment.

Foreign Trade Policies  Besides the Reciprocity Treaty of 1873 with the United States, the other major foreign trade policy was the National Free Trade Agreement [NAFTA] in  Although Canadian exports increased, a lot of manufacturing jobs were re-located to Mexico where the labour is cheaper.

Work Relations  Industrialization created a new social class = THE WORKING CLASS.  The tough conditions in the factories led workers to create UNIONS, which were illegal until  Quebec created the first legislation in 1885 that insured the minimum age of workers (14) and the maximum number of hours (60 for women, 72.5 for men).  It was called the Provincial Manufacturing Law

Work Relations  The 1940’s saw many strikes as unionized worker fought for better working conditions: better wages, vacation pay, pensions and social benefits.  But not all groups were treaty equally, men and women for example, as well as those closer to urban areas and so on…  By the end of the 20 th century the expansion of the Tertiary Sector and technology made education an essential condition for employment.

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