TRANSACTIONS OF SECTION F. 467 



and her markets. The natural lines of her development and the considerations 

 which may alter and affect them. The two ideals — freedom and regulation of 

 trade. 



The History of the Movement towards Reciprocity. — The establishment of 

 Free Trade in England in 1846 is followed by irritation and protests in Canada, 

 and leads to a policy of closer intercourse with the United States, culminating 

 in the Elgin-Marcy treaty of 1854. This treaty results in a great increase of 

 Canadian trade, especially during the American Civil War; but dissatisfaction 

 in the United States and political friction terminate the treaty in 1866. 

 Reciprocity continues, however, to be an object with Canadian statesmen; 

 Canada makes repeated efforts to revive it between 18C6 and 1S78 ; and it long 

 continues to be the aim of large classes and interests in the Dominion. 



The Movement towards a 'National' Policy. — Meanwhile a different ideal 

 of trade policy asserts itself, beginning in 1S58 and 1859 with the Tariff 

 measures of Cayley and Gait. This gains ground after Confederation, triumphs 

 decisively in the General Election of 1878, and results in the National Policy 

 of 1879-1896. This policy, although repudiated by the Liberals in opposition, 

 is in fact adopted and extended by them on their accession to power, and remains 

 from 1897 to 1907 the ruling influence in Canadian trade. A preference to 

 Great Britain is, however, combined with it, which is raised in 1900 to 33^ per 

 cent., but which is afterwards modified and limited in 1904 and in the Tariff 

 revision of 1906-07. 



The Working of the British Preference.— The object and the value of pre- 

 ference. Its _ advantages for British manufacturers and for Canadian con- 

 sumers ; but its inevitable disadvantages for protected Canadian interests. The 

 general question of colonial preference ; what it involves ; the British side. The 

 difficulty of making preference effective ; limitations even in the Canadian case. 

 The inevitable dilemma involved in all efforts to reconcile preference with 

 protection. 



The Results of the National Policy — two-fold. — The stimulus given by pro- 

 tection to manufacturing interests in Canada. The growth of tariffs and the 

 claims of the interests affected ; the favourites of protection — soap, sugar, iron 

 and steel, and others ; the ' Red Parlour ' politicians. The organisation of 

 trusts and their rapid development. Large combines and their profits. Influ- 

 ence of the Press. Concentration of power in the hands of a limited number 

 of ruling interests. The other side of the policy; the unorganised interests 

 suffer. Decrease in the number of manufacturing establishments and in many 

 cases of the hands employed. Limitations on production; decline in some great 

 exports ; doubts whether the tariff, while building up certain wealthy interests, 

 is developing Canadian resources to the best advantage; significant figures. The 

 unprotected interests and their grounds of complaint. The cost of living and 

 the rise in prices. The position of the workman ; the position of the farmer ; 

 the handicap imposed by the tariff on the farming, the mining, and the fishing 

 industries. The revolt of the West. The revival of reciprocity as an active 

 force in Canadian politics. 



The Meaning of the Treaty. — Fears aroused by the new treaty; their slight 

 foundation. The manufacturing interests in Canada; their organised strength 

 the rights of the community against them. British interests; will they suffer? 

 An examination of the effects of the treaty on British preference, British 

 industry and the British food-supply, shows no grounds for serious apprehension. 

 Any measure which helps the natural development of Canada is a source of 

 Imperial strength. Apart from that, Canada is entitled to arrange her fiscal 

 system for herself. Larger issues involved in the problem; the dangers of 

 unnatural restriction ; the meaning and the value of freedom. 



Discussion on Methods of settling Industrial Disputes. Opened by 

 Hon. Samuel Mauger. 



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