Around 170 years ago, the Canadian-American Reciprocity Treaty eliminated customs duties on natural resources, enhancing trade between Canada and the U.S. However, the treaty was terminated in 1866 amidst the upheaval of the American Civil War. Economic shifts and the pursuit of free trade led Canada to strengthen ties with the U.S. Despite initial success, post-war resentment in the U.S. towards Britain, including Canada, resulted in the treaty’s dissolution and contributed to the unification of British colonies into Canada.
The Historical Context of the Reciprocity Treaty
Approximately 170 years ago, Canada and the United States entered into the Canadian-American Reciprocity Treaty, a significant agreement that abolished customs duties on natural resources among other provisions. However, this treaty came to an abrupt end in 1866, driven by the chaotic geopolitical situation during the American Civil War. Let’s explore the key events that led to this dissolution.
Economic Struggles and Shifts
In the early 1820s, the United Kingdom aimed to reduce the cost of imported resources, but the existing protectionist policies, which included customs fees, hindered this effort. Despite these challenges, economic liberalism began to gain traction, leading to the eventual rise of liberal leaders who sought to dismantle tariff barriers.
During this period, Canada enjoyed preferential tariffs, which helped maintain competitive pricing against European imports. However, this British inclination towards free trade resulted in a steep decline in Canadian exports, particularly in timber and wheat.
Turning Towards America
In response to these economic challenges, Canada sought to strengthen its trade relations with the United States, which was experiencing rapid expansion and had a growing demand for resources. Negotiations with President Millard Fillmore’s administration led to the signing of a free trade agreement in 1854, known as the Reciprocity Treaty. This pivotal treaty eliminated customs duties on natural resources, permitting American fishermen to access British North American waters and vice versa, while also allowing American vessels to navigate the St. Lawrence River.
Trade flourished between the two nations, bolstered by the expansion of the railroad and the ongoing effects of the Civil War. However, in 1865, the American Congress announced its intention to terminate the treaty the following year, setting the stage for future tensions.
The Fallout from the Civil War
The 19th century saw stark contrasts in agricultural practices between the Northern and Southern states, with the South relying heavily on slavery and the North employing wage labor. The election of President Abraham Lincoln in 1860 sparked significant fears among Southern slaveholders, who viewed him as a threat to their way of life.
The conflict escalated when Confederate forces attacked federal troops in South Carolina, leading to a full-blown war. Although the North had superior resources and military strength, the conflict persisted longer than anticipated, partly due to British support for the Southern states. As a British colony, Canada found itself inadvertently aligned with the Confederacy.
Aftermath and Consequences
By April 9, 1865, the Civil War came to a close, leaving the United States in ruins and the government deeply resentful towards Britain and its colonies, including Canada. The war claimed countless lives and inflicted severe financial hardship on the nation.
In the wake of this national trauma, President Lincoln championed the ratification of the 13th Amendment, aiming to abolish slavery. U.S. policymakers were determined to prevent such divisive conflict from occurring again, casting their gaze towards British territories in the north that had seemingly fueled the discord.
In this climate of animosity, the U.S. Congress declined to renew the Reciprocity Treaty in 1866 and threatened to eliminate British influence north of its borders. This looming threat of aggression spurred the British colonies to unite, ultimately laying the groundwork for the nation we now know as Canada, born partly from the fear of potential invasion by the United States.