Growth of trade — Official returns — Great Britain— Canada—United States—France and Germany—Imports and exports—Attractions for settlers—Capital brought into the Dominion—Increased cost of living — Government inquiry — Causes of the increase—Plain living and high thinking— Emigration Amendment Bill—Protests and criticisms—Lord Crewe’s protest—Modifications of the Bill—Tariff and Reciprocity—Petition to the Government—The statement of the case by experts—Sir Wilfred Laurier’s reply — A counterblast— The general election.

THE growth of trade in Canada has made vast strides, each decade showing a substantial increase on the previous one, and nearly doubling between 1900 and 1910. Taking the year 1870 as a basis, the march of prosperity is shown in the following official returns:

1870 ............total trade £29,677,565
1880 ............„ „ £34,880,241
1890 ............„ „ £43,721,478
I900 ............» » £76,303.447
1910 ............» ». £138,642,244

An analysis of the trade operations shows that the largest was transacted with the United States, being 49.70 per cent. Great Britain comes next with 36.16 per cent., the remainder is scattered over 70 countries. France comes third, her imports, consisting of grains, tinned fish, fruits, pulp and agricultural implements. Germany takes the fourth place with grain, tinned fish and fruit.

Making a further comparison during the past ten years, Canada has outstripped the United States and Great Britain, the figures being, Canada, 1899-1909 increase, 88.14 Per cent.; United States, 55.19 per cent. ; Great Britain, 37.81 per cent.

The rapidly increasing population of the Dominion, which has naturally stimulated trade, accounts for Canada’s lead. The fact is an illuminating one, that, with the exception of the Argentine, the Dominion holds the premier place for trade increase in the world during the last decade.

Taking the trade per head the figures work out differently. Great Britain comes out top in 1909 with an increase per head in round numbers of £21, Canada, £18, United States, £7.

During the past four years, 1907-1910, the official returns show the up-grade of Canada’s import and export trade:

The attractions of the Dominion for the young and enterprising of all nations have annually swelled the number of settlers. To this circumstance much of the rapid strides she has made must be attributed. Settlers have not come empty-handed. Many of them possessed sufficient capital to start advantageously; and, coupled with industry, the success of that class of emigrant was practically assured.

Official statistics show how widespread the influx has been. From 1897 to 1910, British settlers amounted to 600,411, European continent, 445,766, United States, 529,268.

Of capital and money effects it is estimated that in five years, 1905-1910, over £65,000,000 have been brought into Canada.

With the rapid growth of population and industries, the cost of living has greatly increased. Whilst this may be taken as symptomatic of the march of wealth, the rate of the rise in commodities has assumed such a high figure that the matter has been made the subject of official inquiry, and a report has been issued from the Government Labour Department of the Dominion.

In the year ending 1909, the cost of grain and fodder rose 49.9 per cent.; cattle, sheep and fowls, 48.6 per cent.; dairy produce, 33 per cent.; wholesale price of leather, boots and shoes, 35 per cent.

Agricultural products, both raw material and manufactured articles, show the greatest advance.

On the other hand, imported goods are lower than they were during 1890-1899. Mine products have only slightly increased, and if coal be excluded they are below the average. Sugar was only half the price it commanded in 1895, and tea was reduced from 2s. 6d. to 3s. 9d. per lb. to from 1s. 0½d. to 1s. 8d. per lb.

These reductions have been regarded as an inadequate set-off against the inflated value of more important commodities. Bread has increased 46 per cent., wheat 75 per cent., and flour 60 per cent., house rental 25 to 30 per cent., clothing 25 per cent. Wages have advanced meanwhile, but not in sufficient proportion to balance the more costly housekeeping account.

The matter has been ventilated in the Press during the current year, and the acuteness of the discussion has been indicated in such pointed questions as the following: Why is meat double the price of twenty-five years ago? Why are eggs 300 per cent, higher? Why is good butter a luxury for the few? Why are other necessaries so inflated in price ? Can anything be done to check the upward tendency? Are there not unnatural causes at work which are responsible for these conditions? Does the law of supply and demand sufficiently explain the phenomenal increase in the cost of living?

The answers of experts and Government officials vary, but on the whole give a fair statement of the case. Increase in prosperity is the root factor that operates in increased cost. As one writer states, the trouble lay “not in the high cost of living, but in the cost of high living.” The higher standard of life set up by the wealthy section of the community, by no means a negligible one in Canada, has diverted labour from the production of necessaries to that of luxuries, such as motor-cars, yachts, costly dress fabrics and luxurious commodities generally. The class which demands the best of everything, and will have it at all cost, has been a growing one throughout the Dominion. Mr. C. C. James, Deputy Minister of Agriculture for Ontario, regards this factor as such an active one in the higher prices of products, that he prescribes “plain living and high thinking” as the remedy. The rural population of Ontario had decreased, from 1,108,874 in 1899 to 1,047,016 in 1909, whilst in the same period the population of cities and towns had grown from 901,874 to 1,197,274. The effect on the production of the necessaries of life produced by these changes is obvious.

Local combines are another active cause in the greater cost of living. This can scarcely be eliminated, inasmuch as Canadian exports can be purchased in some cases at a lower rate in Liverpool than in Toronto, and agricultural implements made on the shores of Lake Erie command a higher figure in Calgary than in London. United States trusts in meat and kindred commodities also affect Canadian prices.

Economic changes in the West through emigration have a direct bearing on the question. The rapid growth of New Canada has diverted trade in cattle to speculation in land. Huge ranches have been cleared in the interest of the incoming settlers. The scarcity of livestock in the United States has driven dealers to the Dominion market. They pay high prices, and the Canadian wholesale merchants are compelled to do likewise in order to hold their own with their neighbouring competitors. Some one has to pay back, and it naturally falls to the lot of the consumer. Mr. Mackenzie King, Minister of Labour, summarizes the causes of increased cost of living in Canada as follows :—

“1. Extravagance of the rich. 2. High standard of living among the masses of the people. 3. Increase in population, largely through emigration. 4. Increase in the supply of gold. 5. Large expenditure in public works. 6. Higher wages.”

The economic law of supply and demand lies at the root of the whole question. Canada’s increase of population has not been balanced by an equal increase in marketable commodities, either in kind or in skill. Labour is dear because labour is scarce. Where there is competition in supply prices right themselves. I was struck with this in connexion with the restaurant industry. The system of boarding out largely prevails in Canada, not only for luncheon but for all meals, breakfast included. Apartments are let with practically no attendance, and even hotels quote separate terms for rooms and board. Many of the Vancouver restaurants never close day or night all the year round, and in the leading streets are extremely numerous. But the supply is equal to the demand, possibly exceeds it, with the result that although provisions are dear, dinners are cheap, and eighteen-pence will procure quite as good a luncheon in Winnipeg or Vancouver as in the Strand or Cheapside.

Despite the loud complaints against increased cost, poverty has not so far showed its hungry teeth in the Dominion, and the “ workhouse ”—that pathetic symbol of civic decadence—has not yet made its appearance amongst its municipal institutions. The amended law in regard to emigration which has been recently introduced, has evoked protests from many quarters, as imposing undue restrictions. The proposals, which became law May 4th, 1910, are to the following effect:—

1. That each adult should be possessed of £5 in addition to a railway ticket, or a sum of money sufficient to reach a specified destination in Canada.

2. That the head of a family should have £5 for each member of 18 years and over, and £2 for each member between 5 years and 18.

3. That between November 1st and end of February each year, these sums should be doubled.

4. Exceptions might be permitted in case of males already hired, and going to employment on farms, females to domestic service, or persons about to join relatives.

5. The regulations did not apply to Asiatics, who were required to possess £40 each, except in the case of emigrants from countries with which Canada might have special treaties.

These provisions caused considerable discussion in the Dominion Parliament. The reason for them was stated by the Minister of the Interior on January 19th as follows:—

“When the Act of 1906 was introduced it was framed with a view of dealing with emigrants from over seas. Although it applied to emigrants from across the line, it was especially framed to meet the other conditions. Now it has become necessary to make similar provisions for the exclusion of undesirables along the 3000 miles of frontier between Canada and the United States, that we formerly had carried out at the ocean ports. And as the Act was drawn with a view to applying at the ocean ports, it is necessary that it should be amended in its definitions and operations so as to clearly and definitely provide for the exclusion of undesirables who arrive in Canada by rail or by road. There has also arisen since the passage of the Act of 1906, the question of Asiatic emigration. And while in that respect the Act does not require much change, still it has been thought desirable to provide for effectively dealing with that class of emigration, not so much by the introduction of a new principle, but to provide a specific means for the enforcement of that principle. This Bill also provides for relieving the situation as it at present exists, in which the Government has to exercise an arbitrary authority in the exclusion of emigrants. This Bill provides that under certain circumstances a Board of Inquiry shall sit and decide on the merits of the cases brought before it, a record of each case being kept.”

Protests were made against the regulations by British emigration and charitable organizations generally. A statement was contributed to “The Standard” by Lord Strathcona, which sought to soften the asperity of the restrictions by the assurance that they were only directed against an unsuitable class, upon whom it was desirable that a check should be imposed.

The Canadian Manufacturers' Association opposed the Bill as seriously restricting the importation of artisans. A portion of the Canadian Press joined in the outcry, indicating the shortage of labour in manufacture as a strong reason against the barring of artisan labour, which was as essential as farmers to the well-being of the country.

The regulations received support from other quarters, but a protest from Lord Crewe had considerable weight, and led to some modification in the Bill. Of the terms contained in this memorial from the Colonial Secretary particulars were not published. As the outcome, the Canadian representatives in great Britain were intrusted with large discretionary power in dealing with emigrants other than the farming class, who had the prospect of work on landing in the Dominion.

The question of tariffs has become a burning one in Canada. In December 1910 a deputation of over 1000 western farmers waited on the Dominion Government at Ottawa. A considerable number of the farming class from Ontario, Quebec and the maritime provinces joined the delegation. Indirectly the deputation was the outcome of organized associations, banded together in pursuit of common agricultural interests. Directly, the speeches of Sir Wilfred Laurier, during his western tour and pending reciprocal relations with the United States, led the farmers to definitely formulate their demands. These were embodied in a series of resolutions endorsed by the National Council of Agriculture of which the following is an epitome :—

1. Urging the Government to acquire and operate public utilities under an independent commission.

2. To erect the necessary works, and establish a modern and up-to-date method of exporting meat.

3. To obtain ownership and public control of the Hudson Bay Railway.

4. To amend the Railway Act in certain particulars.

5. Urging Reciprocity with the United States, and the reduction of duties on British goods.

Papers were read on these subjects, but the discussion most vital and interesting followed on the question of Reciprocity and duties.

Tariff was described by Mr. J. W. Scallion, President of the Manitoba Grain Growers, as “a great burden upon the agricultural industry and the great body of consumers.”

The delegates representing the agricultural interests of Canada, and the mass of the common people, “strongly protest against the further continuance of a tariff which taxes them for the special benefit of private interests. They say that this is wrong in principle, unjust and oppressive in its operation and nothing short of a system of legalized robbery. Prices for the produce of the farm are fixed in the markets of the world by supply and demand and free competition when these products are exported, and the export price fixes the price for home consumption ; while the supplies for the farm are purchased in a restricted market, where prices are fixed by combinations or manufacturers and other business interests operating under the shelter of our protective tariff.”

The speaker was in favour of reciprocal relations with the United States, but more than Reciprocity was needed.

“We are in favour,” he said, “of an increase to 50 per cent, in the British Preference, and in favour of further increase from time to time until the duty on British interests is entirely abolished.”

Mr. E. C. Drury, Secretary of the National Council of Agriculture, advanced as an argument in favour of fiscal changes, the decline in agricultural interests—the farming community had decreased in every Canadian Province east of Manitoba, and that Protection was no longer needed to encourage infant industry. He advocated British Preference, and ultimate Free Trade with England.

An argument on the effect of taxation upon agricultural implements was advanced by Mr. R. Mackenzie of the “Grain Growers’ Guide.” Agricultural implements manufactured in Canada, according to the last census, amounted to £2,567,149. Of that amount £468,565 worth was exported. The imports that year amounted to £318,962. “It is now conceded,” said Mr. Mackenzie, “that the manufacturer adds to the selling price of his commodity the total amount of the protection granted him by the customs duty. The farmers of Canada thus paid to the Government that year £63,736, and to the manufacturers of farming implements £419,676.

A similar case was urged against taxation of woollens, cottons, leather, cement, and cutlery, which paid to the Government £197,831, and to the manufacturer £2,455,429.

In 1905 upon the sales of Canadian manufactures amounting to £141,200,000 a tribute was collected from the consumers of £38,000,000.

The demands on fiscal changes were formulated as follows:—

1. “That we strongly favour reciprocal free trade between Canada and the United States in all horticultural, fuel, agricultural, and animal products, spraying materials, fertilizers, illuminating and lubricating oils, cement, fish, and lumber.

2. “Reciprocal trade between the two countries in all agricultural implements, machinery, vehicles . . . and in the event of a favourable arrangement being reached it be carried into effect through the independent action of the respective governments, rather than by the hard-and-fast requirements of a treaty.

3. “We also favour the principle of the British Preferential Tariff, and urge an immediate lowering of the duties on all British goods to one half the rates charged, . . . and that any trade advantages given to the United States in reciprocal trade relations be extended to Great Britain.

4. “For such further gradual reduction of the Preferential Tariff as will ensure the establishment of complete free trade between Canada and the Motherland within ten years.

5. “That the farmers of this country are willing to face direct taxation in such form as may be advisable to make up the revenue required under new tariff conditions.”

Sir Wilfrid Laurier’s reply was guarded. He expressed surprise that Eastern farmers should have joined Western in the petition. With the principle of some of the demands he was in sympathy, but with the question of the nationalization of railways and public utilities he kept an open mind.

With regard to Reciprocity the Government wanted better commercial relations with the United States, but “any change in trade relations” with regard to manufactured products was a more difficult matter, and “Nothing we do,” he stated, “shall in any way impair or affect the British Preference; that remains a cardinal feature of our policy.”

The Toronto “Globe,” the Liberal organ, regarded the movement set afoot as destined to affect the entire fiscal question. The growth of the West was so rapid that in a dozen years it would be in a position to dictate the fiscal policy of the Dominion, and to ignore it would be folly.

The St. John’s “Standard,” a Conservative journal, sought to discount the value of the memorial by stating that the arguments were stale and nothing more than a repetition of those used by Sir Richard Cartwright and the Liberals in the eighties.

Other criticisms were to the effect that the deputation only represented 25 per cent, of the Western farmers; that the proposals meant diverting the trade of Great Britain to the States, and that the entire movement was of a class character. As might be expected, a counterblast came from the Canadian Manufacturers’ Association, which charged the Western farmers with ignoring every one but themselves; that Canada had become united and strong under moderate protection, and the movement was controlled in the main by “New Canadians,” unacquainted with the history or the aims of the Dominion.

Mr. T. A. Russell, of the Toronto Cycle and Motor Co., pointed out that Canada had been unfairly treated by the United States.

“For the past ten years,” he said, “our purchases from the United States were £320,000,000. Their purchases from us were £160,000,000. They are twelve times greater in population. In other words, our purchases from the United States were £6 per head, theirs from us 4s. 6d. per head. The United States average tariff on all goods, dutiable and free, is 24 per cent., ours 16 per cent. Theirs on dutiable goods, 42 per cent., ours 27 per cent.” He urged that Canada’s natural resources would be wasted instead of conserved, and that its seaports would be sacrificed to those of New York and Boston. Indirect taxation affected farmers less than other classes, whilst direct taxation would be correspondingly heavy, and all this in view of the fact that farmers were doing well.

“Our Western country is being filled up as fast as we can assimilate the additions. Railways are being constructed, our factories are busy, our country’s credit never stood so high. And what of the farmer? In the West he has grown rich in a decade; in the Niagara Peninsula his land values have increased tenfold ; throughout Canada he gets 50 per cent, more for his grain and fodder than he did a decade ago, 48 per cent, more for his meat and 35 per cent, more for his dairy produce, and this at a time when the cost of manufactured goods has, as a whole, remained stationary or decreased.”

Before the above particulars had gone into type the result of the Canadian elections came to hand. The Liberals fought the battle on the question of Reciprocal Relations with the United States, and they lost, and lost heavily. Thus the long tenure of Government under Sir Wilfrid Laurier comes to an end, and determined by an issue on which he confidently expected to secure a following that would reinstate him in power. How far the result was determined by the fiscal question per se, or the larger issue of a fiscal alliance with the United States which might become the thin end of the wedge to a Republican alliance, are matters that are open to debate.

Of one thing I was deeply impressed during my travels, namely, the intense loyalty of all classes to the British Crown, and if, as is surmised by many, the election was determined by an ultimate question of “Under which Flag?” the result will be by no means a surprise to any one who understands the passionate allegiance of the Dominion to the Mother Country.