Unit 7—Growing Pains
A. The National Policy
1. Macdonald’s troubles: the Pacific Scandal of 1873 [text p. 237]
- Macdonald was Prime Minister since 1867
- One reason why Manitoba, BC, and PEI became provinces so quickly was that Macdonald was desperate to fulfill his a mari usque ad mare ambitions.
- One essential piece of that puzzle was the Canadian Pacific Railway (CPR).
- Macdonald gave the contract to build the CPR to Sir Hugh Allan; this meant that the Canadian government would pay Allan to build it.
- It later came out that Allan gave Macdonald’s Conservative (Tory) Party $325,000 during an election campaign in 1872.
- People saw this as Macdonald taking a bribe, and called it the Pacific Scandal.
- Macdonald, already in political trouble, resigned in 1873.
- The opposition Liberal Party took over the government, and Alexander Mackenzie became Canada’s 2nd Prime Minister from 1873 to1878.
2. Mackenzie as PM
a) North-West Territories Act of 1875 [text p. 238]
- The territories were governed from Ottawa, which made things very inefficient.
- What this act did was provide slowly give the territories responsible government.
- It was given a lieutenant-governor and an appointed council.
- When the population was big enough, the territories’ council would be an elected Legislative Assembly.
b) The Indian Act of 1876
- According to the BNA Act, the federal government dealt with the Natives.
- This act aimed to move the Natives onto reserves and use the remaining lands for Canadian settlement.
- The Natives themselves were expected to assimilate into English or French Canadian society or be isolated in the reserves.
3. Mackenzie in trouble
- By the mid 1870s, Canada’s economy was experiencing a downturn, and people blamed Mackenzie.
- Mackenzie and the Liberals were forced to call an election in 1878, and they were opposed by a returning Macdonald and his Tories.
- Macdonald was able to win the election in a landslide because of a new campaign slogan: the National Policy.
4. The National Policy
a) Protective Tariffs [text p. 240]
- Macdonald almost doubled any existing tariffs on imported goods; this way Canadians would buy Canadian goods and stimulate the Canadian economy.
- Macdonald was lucky; the tariffs coincided with an global economic recovery, but people thought it was because of the tariffs.
b) Settlement of the West
- Macdonald aimed at getting more Canadians settled West of Manitoba.
- More people were settling in the U.S. because they already had a railroad and there was free land there.
- The North-West territories were also going through drought and grasshopper plagues.
- Still, Macdonald was determined to plan for settlement and ordered more lands surveyed [diagram p. 240]
c) The National Railway [text p. 241]
- To make everything work, completion of the CPR was essential.
- It was hoped that it would be completed by 1891.
- The project was placed in the hands of William Cornelius Van Horne, whose private company faced some problems:
* It was expensive; even a subsidy of $25 M from Ottawa and a tax exemption weren’t enough.
* It had to cross a huge distance.
* It met resistance from Plains tribes and Métis because it went through their land (more on this later).
* Taxpayers thought it was an impossible waste of money.
- Van Horne was determined, and the railway was finished 1885—a full 6 years early.
- Because of this, more settlers decided to settle in the North-West territories instead of the U.S.
Assignment
1. Compare the Indian Act of 1876 to the Act of Union in 1841.
2. Look at the diagram on p. 241; explain how important the building of the CPR was.