14

In the accompanying chart, the figures representing our export and import trade with Canada, from 1850 to 1870, have been plotted. It will be observed that during the fiveyear period preceding the ratification of the Canadian treaty, our trade with Canada was steadily increasing, both exports and imports tending upward at substantially the same rate. During the ten years from 1855 to 1864, inclusive, no increase in the general level of trade is to be observed. Two periods of depression may be noted, the first falling in 1857-1858, the second in 1860-1862. The earlier of these depressions is attributable to the crisis which prevailed throughout the United States and to some extent throughout Canada during those years. The lowest point of depression was reached in 1858; but, in international trade, as in other lines of industrial effort, this crisis was short-lived, and both exports and imports recovered in 1859. The Civil War was a serious injury to our export business during 1860, 1861, and 1862, and it was not until 1863 that the figures reached anything like their old level. On the other hand, imports were not immediately injured at the time of the war, but seem to have suffered from the depressing effects of the struggle somewhat later, the lowest point being reached in 1863, at a time when exports were already on the mending hand. This is precisely what should have been expected. During the war, of course, when the productive power of our own country was curtailed, we naturally looked to Canada for supplies, and 1860 and 1861 were the only years in which our imports from that country exceeded our exports during the life of the treaty, until just at the time the agreement was about to close. Recovery had already begun before the end of the Civil War, and 1864 might be considered a more normal year. Then, with the general recognition of the fact that the treaty was practically certain to be abrogated, came a great rush to bring quantities of Canadian goods over the border before the duties again became effective. This movement accounts for the abnormal

increase in imports in 1865, and particularly in 1866, which fell off as sharply in 1867. During the four years after the termination of the treaty-1867-1870-trade continued on a lower, but fairly normal level, and the close of the period shows a marked tendency to an increase in both exports and imports. There is certainly nothing in the course of our aggregate trade statistics which would go to show that Canada was reaping an unusual advantage. It is true that there is a marked change in the relation between exports and imports at the beginning of the period studied in the accompanying chart, as compared with that which existed at the end of it. Yet this change from an excess of exports to an excess of imports was certainly not the result of the treaty. During its life, while our imports certainly increased relatively to exports, they were, for the most part, distinctly lower in absolute amount. Even from the point of view, therefore, of those who attach great importance to the "favorable balance of trade," there is no evidence that would lead us to consider the working of the Canadian treaty unfavorable to us. In fact, it seems to have had, owing to the unwonted character of the events by which its existence was characterized, very little chance to show what it could do. Its results were certainly of much less importance than might have been expected. The movement which finally drove imports above exports was the outcome of our increasing tendency to look to Canada for certain raw products, the supplies of which were becoming materially reduced in our Northern and Eastern States, or which had never existed there. This tendency continued, and was not even neutralized, by the termination of the reciprocity treaty.

The truth about the Canadian treaty may be summed up very briefly. Its abrogation was due primarily to political influences, which had nothing whatever to do with commercial considerations; and secondarily, to the dissatisfaction felt by certain special interests which found themselves pressed

by Canadian competition, forcing them to reduce prices to the consumer where otherwise they would have found it easy to maintain them. Whatever truth there may be in the argument concerning the progressive increase in Canadian duties, and the attempt to prevent American vessels from doing their share of the carrying trade, there was certainly not enough of force in these considerations to lead to the abrogation of the treaty, had special political influences been absent, and had a few considerable interests not fancied themselves jeoparded by the continuance of reciprocity.

With the final suspension of negotiations after the unsuccessful attempt to renew the Canadian treaty in 1866, the history of actual reciprocity with Canada comes to an end. A chapter of history might be written upon the efforts made at intervals from that time to this, to re-establish some kind of free commercial intercourse. There have been numerous attempts to induce Congress to modify our customs duties in favor of raw products coming from British North America, and on not a few occasions it has been sought by Canada to resume negotiations on the subject. Thus, in July, 1869, Sir John Rose, then Canadian Minister of Finance, made a journey to Washington in order to negotiate a new treaty. While it is understood that no documentary evidence exists concerning this visit, it is maintained by some that complete reciprocity or commercial union was offered by Mr. Rose to President Grant's administration. Again, in 1873, the Liberal Party gained the upperhand in Canada. In February of the following year the question of trade with the United States was reopened. Mr. George Brown, acting as plenipotentiary for Great Britain, in conjunction with Sir Edward Thornton, then British Minister at Washington, drafted a treaty which was sent to the Senate by the President, but was rejected and returned by that body.50 Subsequent to these fruitless negotia

40 Canadian Magazine, Vol. VIII. (Mar., 1897), p. 427.

so Ibid., p. 429.

tions, the high tariff legislation of Canada and the United States made it practically impossible to think of reciprocity as a feasible scheme. It was not until 1890 that the idea was resumed by the Canadians. In October of that year, probably actuated by the reciprocity debates in connection with the McKinley tariff, the Hon. Robert Bond, Colonial Secretary of the Newfoundland Government, came to Washington and held conference with Mr. Blaine, then Secretary of State, concerning mutual trade concessions. These negotiations led to the intervention of Great Britain on behalf of Canada. It was proposed by the British Minister that a general discussion of all outstanding questions should take place, the old reciprocity treaty of 1854 to be accepted as the basis for negotiation, and so modified and extended as to make it mutually acceptable to the two countries. Such a conference ultimately took place in February, 1892. Our position, however, was such as to put further negotiations out of the question. Mr. Blaine adopted an attitude highly unsatisfactory to the Canadian representatives, declaring our policy to be the application of reciprocity to manufactured, as well as natural products, and claiming that such a reciprocity agreement, if concluded at all, should apply only to the United States; as against all other competitors in Canadian markets.

The continued agitation for better trade with foreign countries, which was so active in the United States during the decade 1880 to 1890, stimulated the Canadian demand for closer relations with the United States. The liberal party of Canada began in 1888 a vigorous campaign for "Unrestricted Reciprocity," by which was meant a degree of free trade in manufactures, as well as in natural prodts, between the two countries. This movement vis drengthened by the passage of the McKinley bill with its reciproci v provisions. In spite of the unsuccessful negotians with Mr. Blaine in 1891 the liberal party none the less opted, in 1893,