From Protectionism to Globalization: The Rise and Internationalization of Canadian Capital February 4

External influence on Confederation After Britain’s repeal of the Corn Laws (1846) and the end of the Reciprocity Treaty with the US ( ), Canada was without a trading partner. Fear of American military power, the Fenian raids and the rivalry over the western portion of the continent were factors leading to Confederation in Canada.

Internal Influence on Confederation Political deadlock in the Province of Canada. Economic development was occurring and the emerging industrial and political elite saw benefits to be had in building Confederation and transcontinental project.

Pre-Confederation Economic Development The strength of the wheat economy in Upper Canada/Canada West/Ontario combined with immigration and a canal and railway building spree to launch economic development and the beginnings of industrialization around the mid 19 th century. At the time of Confederation, Canada was the 8 th largest manufacturing country in the world. By 1871, manufacturing accounted for just under 25% of GDP.

Confederation Ryerson: Confederation resulted from “the growth of a native, capitalist industry, with railway transport as its backbone, and expansion of the home market as the prime motive for creating a unified and autonomous state” Naylor: “Confederation itself was little more than an elaborate exercise in public finance” Underhill: “government of the people, by lawyers, for big business”

Protectionism Galt Tariffs of National Policy Tariffs of 1879 The tariffs distinguished between semi- finished goods and industrial materials ( percent duty) manufactured equipment (25 percent) and finished consumer goods (30 percent).

Protectionism Naylor: “The Macdonald tariff produced industry in Canada but no Canadian industry” Naylor called this “industrialization by invitation” Bliss: “the funny thing about our tariff walls was that we always wanted the enemy to jump over them. Some walls!”

Canadian statism What was the significance of the active Canadian state? a pragmatic, public enterprise culture latent socialism (which is described positively or negatively depending on the author) public enterprise for private accumulation

Debating Free Trade Wilfrid Laurier and the Liberals campaigned on freer trade with the US in 1891 and Both times they lost to the Conservatives. “No truck nor trade with the Yankees” – Robert Borden, 1911

Second World War During the Second World War, Canadian and American defence policy and production for the war effort were highly integrated. Ogdensburg Agreement 1940 created Permanent Joint Board on Defence Hyde Park Declaration 1941

Postwar Trade Liberalization Canada signed on to the General Agreement on Tariffs and Trade (GATT) in Successive rounds of negotiations led to an increasingly open trading environment.

Growing Concerns about American Foreign Policy Bomarc missile crisis, Vietnam War

Growing Concerns Over Foreign (esp. American) Ownership Pipeline Debate 1956 Royal Commission on Canada’s Economic Prospects, Gordon Report, George Grant, Lament for a Nation, 1965 Taskforce on Foreign Ownership and the Structure of Canadian Investment, Watkins Report, Kari Levitt, Silent Surrender: The Multinational Corporation in Canada, 1970 Task Force on Foreign Ownership, Gray Report, The Waffle, Committee for an Independent Canada,

Federal Government Response to Economic Nationalism Canada Development Corporation 1971 The Third Option 1972 Foreign Investment Review Agency 1973 Petro-Canada 1975 National Energy Program 1980

Canadian Business Embraces Continentalism Business groups like the BCNI (which later becomes the CCCE) and think tanks like C.D. Howe Institute helped generate a business consensus in favour of free trade with the US.

Canadian State Embraces Continentalism Royal Commission on the Economic Union and Development Prospects for Canada, Macdonald Commission, Canada-US Free Trade Agreement (FTA), 1989 [ North American Free Trade Agreement (NAFTA), 1994 Meanwhile, GATT was transformed into the World Trade Organization (WTO) in 1994.

The FTA and NAFTA: More than ‘free trade’ agreements Along with trade in goods, these deals cover: services investment and investor rights national procurement policies intellectual property rights energy provisions (Canadian govts can not act to give Canadians preferential access to Canadian energy, such as oil. US consumers and business have their access to Canadian energy protected.)

Anti-Globalization Movement “Anti-globalization” movement or “global justice” movement?

Birth of a movement in Canada In Canada, the “anti-globalization” movement has its roots in left nationalism of the late 60s and early 70s. Its intellectual roots are provided by the New Canadian Political Economy (NCPE), including the dependency theorists and the Marxist theorists.

Fight Against the FTA Council of Canadians, formed 1985 Pro-Canada Network, 1987 which becomes the Action Canada Network, 1991, later becomes the Solidarity Network, 1998, and then fizzled out around Citizens Concerned about Free Trade led by David Orchard

NAFTA Battle Against NAFTA: Common Frontiers Side Agreements were negotiated: North American Agreement on Environmental Cooperation (NAAEC) North American Agreement on Labor Cooperation (NAALC)

APEC Summit, Vancouver 1997 Asia-Pacific Economic Cooperation The RCMP acted with significant force to try and keep protesters completely out of the sight of the delegates, including the Indonesian president Suharto. The controversy over the RCMP response led to an inquiry from 1998 to The inquiry was highly critical of the RCMP and the federal government.

Selected Anti-Globalization Demos Around the World Geneva, WTO, May Köln, Germany, G8, June Seattle, WTO, November Davos, World Economic Forum, January Washington, DC, IMF, April Prague, World Bank/IMF, September Genoa, G8, July 2001, one protester shot dead. Kananaskis, Alberta, G8, June 2002.

Quebec Summit, April 2001 Video: View from the Summit. Featuring: demonstrations against the Free Trade Area of the Americas (FTAA), including a march of 50,000 people. Operation Salami: formed during the movement against the proposed Multilateral Agreement on Investment (MAI). It organized and promoted peaceful civil disobedience, obstruction CLAC: Anti-Capitalist Convergence favoured and supported a diversity of tactics: green zone – festive demonstration, yellow zone - obstruction, red zone - disruption Thomas D’Aquino, president of the Business Council on National Issues, now the Canadian Council of Chief Executives. Richard Feinberg, American academic and former consultant to the US State Department.