The National Policy

Pacific Scandal, 1873 The Conservative administration of Sir John A. Macdonald had accepted campaign funds from Sir Hugh Allan in return for a promise to award Allan's syndicate the contract to build the Canadian Pacific Railway The government, including Macdonald, was forced to resign in 1873 because of the scandal, and the Conservative party was badly defeated in the ensuing elections

Depression, 1874 – 1878 Canadian economy suffers from the effects of a worldwide depression resulting in high unemployment, widespread business failure, and loss of confidence in financial institutions Macdonald’s Conservatives benefit politically from this crisis as many Canadian businesses felt Alexander Mackenzie’s Liberals did not protect their economic interests, who favoured low tariffs

Federal Election, 1878 I’m Back Baby! Macdonald attacked Liberal’s low tariff policy – higher tariffs would prompt Canadians to buy products made in Canada Transcontinental railway not completed by the Liberal government leaving the West venerable to American annexation British Columbia was being lured by the Americans to join their union The Red River Colony in the West was trading exclusively with the Americans

Elements of the National Policy Macdonald’s new National Policy consisted of three initiatives: Protective tariffs against foreign goods and revenue tariffs applied to goods not manufactured in Canada Completion of a Transcontinental railway Greater immigration and settlement of the West

Elements of the National Policy Duties of over 40% levied on products coming into the country Canadians believed economy to dependent on staple industries; spending during depression years decreased resulting in exports falling 20% Economy diversified as a result; secondary manufacturing industries developed in the new Canadian Heartland of Ontario and Quebec Protective tariffs: taxes imposed on imported products to encourage people to buy domestic products These tariffs allowed struggling Canadian businesses to get back on their feet The east and west would now provide a supply base for a strong central manufacturing base in central Canada

Effects of National Policy Railway from Sea to Sea Completion of the CPR represented the backbone of the new national economy Concessions of money, land, and no competition agreement with CPR granted by federal government Most dangerous tasks, such as planting explosives, given to Chinese workers – 600 died during construction CPR completed in 1885

Effects of National Policy Creation of Industrial Heartland Nation’s primary manufacturers centered in Toronto and Montreal Central Canadian firms grew stronger as tariffs protected Canadian entrepreneurs from American competition, with money and people moving in to build up the growing markets. CPR allowed central Canada to have easy access to markets in the east and west

Effects of National Policy Impact in the Maritimes As nation’s hinterland, railway promised new trade possibilities for Atlantic Canada Increase commerce because of Halifax’s ice free harbour and access to tariff protected markets – boomtowns along rail route Consolidation and absorption of Maritime businesses and financial institutions by central Canadian and international industries led to Maritime economic decline Coal industry thrived in Maritimes until it was until no longer protected by tariffs

Effects of National Policy Impact in the West Industrial centers could not develop to rival those in Montreal and Toronto – distance from central Canada hindered growth Settlement slowed due to lower demand for wheat during economic downturn and availability of land in American west Wheat and grain-growing potential eventually realized as west took advantage of federal subsidized shipping Métis and First Nations impacted as settlers encroached on reserve lands forcing them to move west disrupting way of life – North West Rebellion in 1885

Impact of Industrialization Working Conditions Industrialization took hold of Central Canada creating harsh working environments – long hours, disease and injury common, exposure to dangerous chemicals, and failure to meet exacting demands of employers led to loss of wages or physical punishment Exploitation of women and children by industries, sweatshops, piecework, and lack of a social safety net.

Impact of Industrialization Working Conditions Sweatshops – places in which people labour for long hours under harsh working conditions, for little wages Social safety net – government programs and services that provide aid for citizens in need Piecework – work that is paid on the basis of the amount done, not on the time it takes

Impact of Industrialization Standard of Living Married couples who both worked made a modest living – families with children often lived in poverty forcing children to work Working families often lived in slums with no running water, sewers, or electricity – high rent forced families to live together Malnutrition and high death rates – particularly infant mortality rates

Social Response to Industrialization Response of Middle Class Progressive movement took initiatives to help poor – working hours regulated, Lord’s Day Act, and subsidized housing to eliminate slums Temperance movement led to the prohibition of alcohol – other morality laws passed aimed at gambling and prostitution Improvements to public health a priority – new hospitals and clinics built and school vaccinations adopted

Social Response to Industrialization Response of the Workers Workers responded in one of two ways: Trade unionists fought for a share of benefits of industrial prosperity, such as higher wages, shorter working hours, and better working conditions by taking strike actions and lobbying governments More radical industrial workers called for all workers to unite in order to restructure the capitalist system – many were skilled craftsmen displaced by factory machines