Protection for fledgling Canadian industries—woollens, cottons, iron and steel, shoes, stoves—was not just an economic question, it was philosophical, debated then as now. It was one of the few issues that could be said to divide the two Canadian political parties. Macdonald himself had no philosophical axe to grind—if anything, he had been a free trader—but he had sensitive antennae, and he came to the idea of the protective tariff, slowly, even reluctantly. Perhaps he was convinced by Charles Tupper, who seems to have developed the idea from his Nova Scotian experience.
Calling it the National Policy. Grip in May 1877 summed it up:
... You this great truth should know,
Countries alone by manufactures grow...
Your tools, your arms, your raiment, make hard by.
Your farmers will your workmen all supply With food, your workmen them with all they need,
Each helping each, and profits shall succeed...
Strength shall arise, and Canada be known
Not as a petty colony alone____
The present’s here; the lazy past is done,
We’ll have a country, or we will have none.
What had happened was that the conventional wisdom of the day had shifted over to protective tariffs (under whatever name). Macdonald shifted with it, but Mackenzie did not. Shifts like that are much easier when you are the Opposition and have nothing to lose. As a result, Macdonald was returned to power in the general
Election of September 1878 with as large a majority as he had been defeated by in 1874. The Liberals couldn’t get over it. Some could not get over the new National Policy (np) either, which through Macdonald was to become a permanent feature of economic and political
Women workers sorting ore in the Huntington copper mine near Bolton, Quebec, in 1867; a rare view of working conditions in Confederation-era Canada. Photo by William Notman.
Toronto Rolling Mills. This 1864 pastel by William Armstrong evokes the poem by Archibald Lampman (1861-99) “The City of the End of Things”: “A flaming terrible and bright / Shakes all the stalking shadows there,... And only fire and night hold sway....”
Life in Canada. The basic idea of the National Policy was to encourage, by means of a tariff structure, the development of Canadian industry: allow raw materials in cheaply, such as cotton, wool, unrefined sugar or molasses; and put steep import duties (25 to 30 per cent) on goods that Canadian factories could now manufacture, such as cotton or woollen cloth, refined sugar, nails, screws, engines.
The other principle of the National Policy was that of permanence. No manufacturer was going to put $100,000 into a plant without some belief that tariff protection was going to stay in place for a while. Perhaps twenty-five years was long enough to establish a young industry. Whatever it was, Macdonald and the Conservative government insisted on the importance of “permanence.” The Liberals who fought the np with only indifferent results in Parliament and in three general elections (1882, 1887, and 1891) probably also fought the manufacturers who believed that business depended upon the re-election of the Conservative party. Whether that was true or not, it was true
Under the National Policy.... A colour lithograph (artist unknown) published in 1891 by the Industrial League for the Conservative Party, as part of a series of federal election posters attacking the Liberals’ Reciprocity platform. In fact, the National Policy was always intended to benefit workers and farmers as well as manufacturers.
That the Liberal party only began to get real support from business after 1893, when Laurier and the Liberal party abandoned their free-trade stance and Sir John Thompson, for the Conservatives, came down a bit hard on the
Masseys and others who were making too much money from tariff protection.
Factories, the intended beneficiaries of protection, had been in existence for some years, but it was with the National Policy that they became an important feature of Canadian life. To some contemporaries the Canadian industrial plant seemed to come almost at once, in the expansive years of the early 1880s. Whole new sets of industries appeared: cutlery, clocks, felts, tableware, woollen and cotton goods. The first piece of printed cotton in Canada was turned out in July 1884, from a factory with a capacity of 27,000 metres (30,000 yards) a day. Consumer demand rose; distribution networks expanded.