At an international school, the students were asked to write an essay on the elephant. The American wrote on their economic importance, the German on their uses in wartime, the Frenchman on their sex lives. And the Canadian student’s title was: “The elephant: A federal or provincial responsibility?”
In 2017, Canadians will celebrate the 150th year of Confederation, and the joke about the elephant illustrates just how important federalism has been in Canadian history and society. We will have much to celebrate because Canada is one of the oldest and most successful federations in the world. Many Canadians will want to understand the broad contours of what they are celebrating. Some will want to know a great deal about why Canada adopted a federal system of government, what it meant, how it works, how well it works, how it affects their lives, how it has changed, and how it might change in the future. This book gives some glimpses into these issues.
The Confederation we will be celebrating consisted of two separate but related developments. One was the adoption of a federal system of government; the other was the union of three British colonies into one big colony. On the matter of federalism, there were few models to copy, and the Fathers of Confederation spent years wrestling with the various ideas, issues, problems, and possible solutions. Eventually, they concluded that the only system that would work was federalism. In that system the responsibilities of government are divided between two orders of government, a central one and the provincial ones, both autonomous in the administration of their responsibilities. That is a very difficult system of government to make work.
Unfortunately, the exact demarcation of responsibilities between the two orders of government can never be written out clearly; opinions will differ over whether some issues fall under federal or provincial power or under both, and there will be overlap. Some responsibilities will not be identified, and new ones will arise. There is also a natural competitive instinct as both orders of government try to protect and enhance their power, serve their constituents, and win re-election. The Fathers of Confederation could not possibly have dealt with all aspects of federalism in a manner that would foresee future developments. Most of them disagreed with some of the different decisions and compromises that emerged, but they did agree that what they produced was the best document possible. They got most things right and a few wrong—overall they did better than anyone had the right to expect.
The other aspect of Confederation, the union of Britain’s provinces, proved to be far more difficult to achieve at the time. The Province of Canada, which became Ontario and Quebec, was quite in favour of the proposals that emerged from the 1864 conferences in Charlottetown and Quebec City. It then took over two years for the pro-Confederation politicians in Canada, Great Britain, New Brunswick, and Nova Scotia to engineer the union of just three colonies, and PEI and Newfoundland said no to the scheme. But by July 1, 1867, the Dominion of Canada had a central government plus four provincial ones, and Canada was launched on the uncharted waters of its federalism.
These developments are explored in the first chapter, which takes the story up to the adoption of federalism at the Quebec Conference in 1866, and in the second chapter on the struggle to merge three colonies into one. Chapter 3 is a detailed analysis of the British North America Act, the BNA Act, of all the sections that affect federalism, and of the background to many of the debates over it. These include such issues as the “intentions” of the Fathers of Confederation, the type of federalism they created, the lists of responsibilities given to the two orders of government, the balance between them, questions such as which government was more important or sovereign, the fiscal arrangements, and debates over topics such as the Compact Theory. We also look at the myths that have since arisen, such as the idea that Canada became a country and Canadians became a nation at midnight, July 1, 1867. Myths are important, and we will celebrate them heartily in 2017, but it is valuable to know what is myth and what is reality.
After 1867, the new Dominion faced two very difficult challenges: making the new system work and incorporating the other colonies. BC and PEI were scheduled to join but, due to a number of blunders by the new central government, a small corner of the prairies became the next province: Manitoba. That development was premature by decades and created enormous problems for Ottawa and Winnipeg. Then BC was successfully courted with the promise of a railway, but since the promise could not be fulfilled, it asked to secede. It changed its mind with the completion of the Canadian Pacific Railway (CPR), one of the new Dominion’s greatest achievements. PEI then spent itself into bankruptcy and had no choice but to join, and by 1873 the Dominion counted seven provinces. The incorporation of these three new provinces is covered in Chapter 4.
Three decades later, the settlement of the prairies led to the creation of Alberta and Saskatchewan, both treated differently from all the others with consequences that lasted for decades. Then, in 1949, Ottawa and London arranged for Newfoundland to become the tenth province, once more by a different process than any other province. Eighty-two years after Confederation, the original idea of a single political entity stretching from sea to sea was finally complete. Provincial status for Alberta and Saskatchewan is covered in Chapter 6, and that of Newfoundland in Chapter 9.
Making federalism work was arguably more difficult, and federalism itself has gone through so many phases and permutations that political scientists invented a whole lexicon of expressions to define it. Various texts use at least fifteen adjectives, including asymmetrical, authentic, classical, collaborative, competitive, confederal, confrontational, constitutional, co-operative, flexible, genuine, mixed, open, quasi-, subordinate, symmetrical, and unilateral. Of these, Canada has never been confederal or symmetrical, and it was only unilateral during the First and Second World Wars. How accurate the other adjectives are may be a matter of opinion, and several of them could apply at the same time even if they conflict. The following pages will describe some of these various forms of federalism and the conflicts and contradictions between them as they emerged in the debates or the flow of history.
The main issue leading to Confederation was that, in 1763, Britain found itself in control of a colony of sixty thousand French Catholics. The British wanted to turn them into good little Englishmen, but the Canadiens had no intention of being assimilated. The failure of assimilation was the main factor driving the politicians of the Province of Canada to accept federalism, the system that left Quebec’s French Catholics in control of their lives while Ontario’s English-speaking Protestants were in control of theirs. Provincial governments then controlled education, health, welfare, civil law, property, municipal government, local matters, language, and culture. The new central government was in charge of everything else, of “general” as opposed to “local” matters, of the overall economy and of expanding the colony to the Pacific and Arctic Oceans. In 1867, Nova Scotia and New Brunswick joined the Province of Canada in the new Dominion.
Chapters 4 and 5 outline the way federalism was implemented, and Chapter 6 covers the Golden Age of Federalism under Sir Wilfrid Laurier, a period when Ottawa concentrated on its responsibilities and the provinces on theirs. Chapter 7 documents how the election of Robert Borden and the Conservatives in 1911 renewed Ottawa’s offensive in terms of encroaching on provincial jurisdiction, before the First World War turned the Dominion into a virtual unitary state. The war changed federalism, one of the most important changes being that in 1917 Ottawa entered the field of direct taxes. That had been a monopoly of the provinces, and Ottawa’s taxes squeezed provincial revenue, as did the steady decline in the importance of federal subsidies. The problem of the “fiscal imbalance” has been a dominant theme in Ottawa’s relations with the provinces ever since.
For six decades, the relationship between Ottawa and Quebec was generally harmonious but that came to an end when Ottawa launched a pension plan in 1927, welfare being a clear and accepted matter of provincial responsibility. The Depression (Chapter 8) was a disaster for federal-provincial relations, as the provinces could not finance their responsibilities and Ottawa spent the decade attempting to avoid action and responsibility for welfare. In perhaps the clearest examples ever of federalism’s failures, the central government tried to do things within provincial power, and the province of Alberta tried to do things within federal power, with the result that policies that would have done much good were not implemented at all.
The Second World War (Chapter 9) turned Canada into a unitary state once more. Part-way through the war, the bureaucrats and politicians who ran the country so successfully as a wartime economy decided to continue running it as a peacetime economy. That required the creation of the welfare state by the federal government. The poorer provinces were willing to turn their constitutional responsibilities over to Ottawa; the richer ones were not, especially Quebec, which knew that federal policies reflected English-Protestant values, not French-Catholic ones. The co-operation and conflict between Ottawa and the provinces over the management of health, welfare, and higher education dominated federal-provincial relations and indeed Canadian politics from the Second World War into the twenty-first century. The issues and battles are explored throughout the rest of the book. They include unemployment insurance, the family allowance, aid to the universities, old age pensions, shared-cost programs, the fiscal imbalance, the Trans-Canada Highway, the CPP and QPP, Medicare, support for regional economic development, assistance to municipalities, and the evolving way all these issues have been handled. A further layer of confrontation emerged in the 1970s over control of natural resources (Chapters 12 and 13).
These issues affected the provinces in different ways, but the dominant clash was between Ottawa and Quebec. That eventually led to two referenda on whether Quebec would separate from the rest of Canada (Chapters 13 and 15). In a sense, the issue was the same as the one that produced Confederation in the first place, namely, the attempt by English-speaking Canadians to assimilate the Québécois and the determination of the latter to remain maîtres chez nous, “masters in our own house,” to ensure la survivance of their distinct culture.
Underlying these tensions was the evolving nature of national identities. Before 1867, the term French Canadian applied to the inhabitants of the St. Lawrence Valley; by 1900, it meant anyone of French descent anywhere in Canada, except the Acadians. After 1960, the term once more came to mean French people in Quebec, the Québécois. Before 1867, there were three distinct English-speaking nations: the Irish, English, and Scottish. Over many decades, they evolved into a single English-speaking Canadian nation that gradually assimilated people of non-British origin. These national identities had a major effect on federal-provincial relations, and their evolution is documented in a variety of chapters. Until the 1980s, the First Nations and Inuit were marginalized politically, having virtually no influence on federalism, a situation that has changed considerably since then.
Another theme that runs through the text is the fact that Canadian federalism is asymmetrical, that is, that different provinces are treated differently in the constitution and in practice. That is especially true of Quebec. Numerous examples of that are given in the BNA Act itself and in how Ottawa treated each province subsequently. For example, representation in the House of Commons was based on the principle of representation by population, but that principle was violated for each new province and then for the whole of Atlantic Canada. After the Second World War, the increasingly strong force of English-Canadian nationalism was reflected in the demands that federalism should be made symmetrical and all provinces should be the same and be treated the same. The battles that followed were in part over whether Quebec was a distinct society, whether it had special status, and whether special status should be specifically
recognized in the constitution.
In the power struggles between the two orders of government, few matters have been as important or controversial as the federal “spending power.” The BNA Act did not give Ottawa any such power, but in the mid-twentieth century the theory emerged that since Ottawa had access to any type of taxation, it should be able to spend revenue any way it chose, including in the launching of programs within “exclusive” provincial jurisdiction. It began doing so before the First World War, launched its first major program in provincial jurisdiction in 1927, and used its surplus revenue after the Second World War to turn most exclusive provincial responsibilities into shared ones. The use or misuse of this power is almost certainly the main cause of the rise of separatism in Quebec, and the “spending power” is explored in depth in half the chapters in this book.
The evolution of federalism documents the changing roles and situations of the provinces within the Dominion. On the east coast, Newfoundland simply remained aloof for the first eighty years. The Maritimes joined reluctantly because they knew the financial arrangements were inadequate, and much of their history has involved fighting for adequate financing and dealing with the consequences of that original mistake. For the first sixty years, Quebec was the most contented province but it gradually became the most discontented, and that change receives a lot of attention and detailed explanation. Ontario’s relations with Ottawa were the opposite, as it spent the first century as the main champion of provincial rights and then became Ottawa’s best provincial ally. The West’s place in Confederation is very different, from being Ottawa’s colony to partial autonomy, to exploited hinterland, to near-separatism, and back to full partnership. All these separate currents intermingle with each other in fascinating and sometimes unpredictable ways.
There are three arbitrators when Ottawa and the provinces clash over jurisdiction and power, namely, the politicians, the people, and the courts. The actions of politicians, the public, and the courts thus form themes that run through the entire text. Confederation was launched with the manipulation of elections by the pro-confederates. Ottawa was dominated for most of the first three decades by the Conservative party, but to balance that power the people began electing Liberal governments at the provincial level. When the Liberals became dominant at the federal level, the people began voting Conservative provincially. In both orders of government, politicians have found that public opinion provides one of the most important guides to the way federalism is managed. The interplay of politics and constitutionalism runs through the entire history of Canada.
The other arbitrator is the courts, and this text discusses numerous legal cases that helped define federalism. Originally, the ultimate arbitrator was the Judicial Committee of the Privy Council, the JCPC, in London, so that “vestige of colonialism” was attacked by those who disagreed with its decisions. Their criticisms in the 1930s launched the movement that led to patriation of the constitution in 1982, but that could not be done until Ottawa and the provinces agreed on an amending formula, a process that took over half a century to resolve, assuming it has been resolved. Eventually Canada’s Supreme Court became truly supreme, and it has played a very important role in the relations between Ottawa and the provinces, with opinion divided as to whether that role is positive or not.
Many conclusions emerge from this study, one of the most important being that Canadian federalism has proved to be enormously flexible and resilient. We still live under that old, dusty 1867 British Act of Parliament. It has been formally amended very few times but has been changed repeatedly by convention, that is, by the decisions and actions of governments. In that sense, Canada has two constitutions: the written document, plus all the conventions and agreements that define the mechanics of how Ottawa and the provinces co-operate to manage the country. What governments actually do or do not do is perhaps as important as what the constitution says they can or cannot do. But the BNA Act and the way it has been implemented and interpreted has seen us through the creation of a federal union, the absorption of six more provinces, a variety of crises involving minorities, two world wars and a decade-long depression, the near-disintegration of the country, and massive change to the way the responsibilities of the two orders of government are actually managed. In spite of the conflicts, there has been an enormous degree of co-operation between Ottawa and the provinces on almost every matter that affects the lives of Canadians. And all this was achieved by discussion, debate, and compromise, which, to some, makes Canadian history less interesting than that of countries that addressed similar problems with violence, conquest, insurrection, and civil war. Notwithstanding that view, Canadian federalism is, indeed, one of our greatest achievements. Happy Sesquicentennial!