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Newfoundland's Entry into the Dominion

Published online by Cambridge University Press:  07 November 2014

H. B. Mayo
H. B. Mayo*
Affiliation:
The University of Alberta
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Extract

In view of Newfoundland's long tradition of separation from Canada, and its rich heritage of anti-confederation feeling, how does it happen that union has come about on March 31 of this year? The answer is best seen as it emerges from the background of recent events in Newfoundland.

Faced with imminent default in the early nineteen-thirties, the Newfoundland government resorted to all the traditional tactics, such as reductions in the salaries of civil servants and teachers, and increases in the rates of the customs tariff; and under the spur of necessity resorted to more ingenious measures. The stream of willing foreign lenders had dried up by 1932, and the government fell back upon temporary loans from Canadian banks, upon a deal with the Imperial Oil Company, and upon joint advances from the governments of the United Kingdom and Canada. When to these was added a controller of the treasury, Newfoundland had in fact lost full control of its finances, and hence of its political destiny, even before self-government was formally abrogated.

It was in the midst of this desperate situation in 1933 that the Royal Commission presided over by Lord Amulree was appointed, at Newfoundland's request, “to examine into the island's future and finances.” The Commission duly found bankruptcy imminent, and the debt burden beyond the capacity of the island to carry. Newfoundland's public debt had grown but slowly in the nineteenth century and early part of the twentieth. Including $13 million added for war purposes, by the beginning of the nineteen-twenties, the debt stood at only $43 million. More spectacular increases occurred after 1920, the total debt being more than doubled in the space of twelve years. Throughout this period the average annual deficit was some $2 million, including losses on operation of the railway system which, early in the decade, passed from private hands to government ownership. The current deficits, together with capital expenditures upon public works, were covered by borrowing from abroad at interest rates from 5 to 6½ per cent, to the extent that in each year some $4.8 million was added to the public debt, which by 1933 reached nearly $100 million. This was the period when, according to the Amulree Commission, the country “was sunk in waste and extravagance,” and displayed “a reckless disregard for the dictates of financial prudence.”

Type
Articles
Information
Canadian Journal of Economics and Political Science/Revue canadienne de economiques et science politique , Volume 15 , Issue 4 , November 1949 , pp. 505 - 522
Copyright
Copyright © Canadian Political Science Association 1949

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References

1 Report of the Royal Commission on Newfoundland, 1933, Cmd. 4480 (the Amulree Report).

2 Amulree Report, pp. 43, 46.

3 That is, the amount held in the United States, together with half the amount held in the United Kingdom, was payable in gold.

4 These may conveniently be found in Constitutions of All Countries (London, 1938), vol. I, The British Empire.Google Scholar

5 The Newfoundland Act (Dec. 12, 1933), which had been preceded by an address from both Houses of the Newfoundland Legislature, and by the Newfoundland Loan Act (of the Newfoundland Legislature).

6 Lodge, T., Dictatorship in Newfoundland (London, 1939).Google Scholar

7 United Kingdom, House of Commons Debates, Dec. 2, 1943.

8 Ibid., Dec. 11, 1945.

9 Review of the Financial and Economic Position of Newfoundland, June, 1946, Cmd. 6849.

10 An Act Relating to a National Convention, no. 16 of 1946.

11 Evening Telegram, “Proceedings of the National Convention,” Oct. 30, 1946; Jan. 15 and 16, 1947; Feb. 27, 1947.

12 Evening Telegram, Dec. 13, 1946; Feb. 27, 1947; May 23 and 27, 1947.

13 A summary of the negotiations, with fifteen appendices, was later published in two mimeographed volumes under the title “Report of Meetings between Delegates from the National Convention of Newfoundland and Representatives of the Government of Canada, Ottawa, June 25-September 29, 1947,” and became known as the “Grey Book.” The provisional terms which followed were called Proposed Arrangements for Entry of Newfoundland into Confederation (Ottawa, 1947).Google Scholar This, and other relevant documents-including the final Terms of Union-were later published as Report and Documents Relating to the Negotiations for the Union of Newfoundland and Canada (Conference Series, 1948, no. 2, Ottawa, 1949).Google Scholar

14 The Case for Responsible Government (St. John's, 1947).Google Scholar

15 It must be remembered, too, that many who voted for responsible government were in favour of confederation in principle, but believed that as a matter of procedure, union was a step which ought properly to be undertaken only by a self-governing Newfoundland.

16 Public Ledger, St. John's, 11 5, 1869.Google Scholar

17 Canada, House of Commons Debates (unrevised), Feb. 7, 8, 14, 1949.

18 Since the above was written the federal election has taken place and Newfoundland has elected five Liberals and two Progressive Conservatives.

19 Canada, House of Commons Debates (unrevised), the prime minister, Feb., 1949.