In 1911, a group of prominent Liberal businessmen from Toronto take on the prime minister—and win.
Torontonians flocked to the streets in jubilation on September 21, gathering outside newspaper headquarters and crowding the streets from Front to Queen between Church and York. Cheers arose as returns were announced for the day’s federal election: Robert Laird Borden had led the Conservative Party to a landslide victory over Prime Minister Wilfrid Laurier’s incumbent Liberals.
The Conservatives won overwhelming majorities in all four Toronto ridings, and two of the three York County ridings—the third being won by William Findlay Maclean as an independent Conservative. The national drubbing was so thorough that some observers predicted the extinction of the Liberal Party.
The deciding issue of the campaign was the new Reciprocity Agreement, which secured free trade with the United States. Representing a huge shift in economic policy, the Agreement was anathema to central business interests. The prospect of free trade prompted the Toronto Eighteen, a group of prominent businessmen and entrepreneurs who’d supported the Liberal Party through the boom years at the turn of the century, to publicly chastise the prime minister and abandon the party. Throwing their weight behind the Conservatives, they helped determine the course of the election.
When the Liberals formed a federal government in 1896, their party leader, Wilfrid Laurier, sought to secure free trade with the United States. But, like the Conservative prime minister John A. Macdonald before him, Laurier failed. And he settled into continuing the economic status quo—Macdonald’s National Policy of high tariffs and protectionism meant to develop the Canadian economy—for most of his 15 years in office.
Canada prospered under the National Policy. Millions of immigrants settled the west, resulting in millions of acres newly cultivated as farms. Businesses expanded into nationwide concerns and, though farmers out west complained that tariffs kept the price of goods like farm machinery artificially high, profits soared for many central Canadian firms, turning them into Laurier supporters.
In the late summer and fall of 1910, however, hints emerged from American leaders that a trade war loomed—with escalating tariffs on Canadian goods south of the border—unless a reciprocal trade agreement could be negotiated. Laurier, whose personal commitment to reciprocity had never wavered, entered negotiations enthusiastically, upsetting those who felt the party had long ago abandoned the idea of free trade.
The resulting Reciprocity Agreement, signed January 21, 1911, was comprehensive but fairly limited in its actual impact. Natural products like livestock, agricultural crops, and timber would now cross the border duty-free—along with a handful of very specific manufactured items. Tariffs would be maintained for most manufactured goods, as well as processed food, like butchered meat and biscuits, but at new, lower rates. The new tariffs would introduce a measure of American competition into the Canadian marketplace, reciprocity supporters admitted, but the negative impacts would be minimal and more than compensated by increased sales south of the border.
Nevertheless, backlash against the agreement was swift among the Toronto business community. The Toronto Board of Trade convened a meeting on the evening of February 16. Over the course of the evening’s (mostly one-sided) debate, a number of prominent Liberals in attendance stood to denounce the Reciprocity Agreement. The most notable was Byron Edmund Walker, who’d risen from a humble position in a local branch to become president of the Canadian Bank of Commerce.
One of the city’s leading citizens, Walker had always kept aloof from active politics at any level. Now, he systematically outlined his objections to the agreement. He worried about lower-quality American goods flooding Canadian markets, and wheat making its way south through Duluth or Minneapolis rather carried by Canadian railways via Winnipeg or Thunder Bay. Moreover, the ardent imperialist worried about American immigrants settling the west and whether the Agreement might re-ignite American ambitions to annex Canada.
“Although I am a Liberal,” Walker concluded, “I am a Canadian first of all and I can see that this is much more than a trade question. Our alliance with the Mother Country must not be threatened. We must assimilate our immigrants and make out of them good Canadians. And this Reciprocity Agreement is the most deadly danger as tending to make this problem more difficult and fill it with doubt and difficulty. The question is between British connection and what has been well called Continentalism.”
Other Liberals joining Walker in denouncing Laurier’s reciprocity proposal that evening included R.S. Gourlay, the president of the Board of Trade, and J.D. Allen, a past-president and a businessman. At the meeting’s conclusion, attendees voted on a resolution asserting that reciprocity was “opposed to the true interests of Canada… and should not be consummated.” The resolution passed by a overwhelming majority of 302-13.
(Right: Portrait of Sir Edmund Walker, ca. 1890. From the Archives of Ontario [F 1140-7-0-1].)
“I am at a loss to understand why our friends in Toronto should be driven from their moorings on a question which has been the policy of the party for forty years,” Laurier wrote after being informed of the well-publicized meeting. The prime minister shouldn’t have been surprised. As early as February 3, leading corporate lawyer Zebulon Lash wrote him on behalf of a group of Toronto Liberals. Outlining the business community’s worries regarding the agreement and its feared negative impact on the country’s development, Lash urged Laurier to drop the matter. In the brief correspondence between the two, it became clear Lash and his colleagues’ position more closely resembled Borden’s, rather than the leader of their own party.
“Your views and mine are so far apart that I scarcely hope it will be possible to reconcile them,” Laurier calmly concluded on February 15. “It may be my own fault, and I suppose it is, but I still persist in believing reciprocity in natural products cannot injure vested interests and cannot be a bar to our natural development.” He was confident Canadians writ large would support the policy.
Laurier and his close confidants recoiled from what they saw as their opponents’ crass appeal to patriotism and the British connection in denunciations of Reciprocity. It was, they reasoned, merely a trade agreement, which could be renegotiated or cancelled at any time. Their opponents, however, saw the Reciprocity Agreement as the thin edge of widening American influence on Canadian business and society as a whole.
(Right: Newton McConnell editorial cartoon from the Toronto Daily News regarding the Reciprocity Agreement, ca. 1911. From the Archives of Ontario.)
In the House of Commons debate that winter, Conservative MPs, and numerous dissenting Liberals, focused less on what the agreement said than on what it meant—that is, the very survival of Canada as a distinct country. “Within days” of the Laurier announcing the agreement, Patrice Dutil and David MacKenzie argue in Canada 1911: The Election that Shaped the Country (Dundurn, 2011), “the lines of debate were drawn clearly and they remained virtually unchanged until election day the following September.”
If the Conservatives’ invocations of patriotism and anti-American sentiment in Parliament mirrored those the talking points of the Toronto business community, it was because there were backroom machinations at work. Albert Edward Kemp was a successful businessman and a key Conservative operator in Ontario—who’d almost single-handedly bankrolled the federal party in Ontario through some lean years of Laurier rule. After Laurier was returned to office for a fourth mandate in 1908, Kemp dedicated himself to rebuilding the party’s machine in Ontario, calling upon his upon his social and business connections, cultivated through his leadership on the Toronto Board of Trade, the Canadian Manufacturers’ Association, and pro-Empire organizations.
(Left: Sir Robert L. Borden [right] and Sir Albert Edward Kemp [left] leaving Toronto City Hall, ca. 1918-1920. From the City of Toronto Archives, Fonds 1244, Item 655.)
Kemp recognized that, after nearly a decade and a half in power, Laurier’s grip was slipping, and a number of his policies—like his support for French language rights and his naval policy—were weakening his support among Ontario businessmen, who, Kemp speculated, were a better fit ideologically with the Conservative Party. On at least one occasion, in March 1910, the Conservatives had tried to lure Walker to their ranks with the promise of a cabinet post in a Borden administration. The banker rebuffed the overtures, but the groundwork was laid for further discussions if circumstances changed.
In a February 1, 1911, letter to Borden, Kemp stated with confidence that “[s]ome of the Liberals” in Toronto were eager “to take almost any legitimate steps if they could prevent this Treaty coming into force,” and predicted a public demonstration of opposition to reciprocity was imminent. Indeed, from behind the scenes, Kemp and other Conservatives helped to organize the Board of Trade meeting on February 16, to round up the speakers, and to orchestrate the massive majority for that night’s resolution. In the months and weeks to come, Kemp would encourage boards of trade in urban centres across the country to pass similar resolutions.
That “[t]he Liberal and Conservative Toronto business elites were so intertwined as to be indistinguishable,” as Dutil and MacKenzie assert, is demonstrated by Walker’s relationship with Joseph Flavelle, the long-time Conservative who’d first encouraged him to voice his opposition to reciprocity at the Board of Trade meeting. The two were friends and neighbours, living within blocks of each near Queen’s Park, and were members of some of the same bodies: the Lambton Golf and Country Club, the York Club, and the nascent imperialist group, the Round Table Movement. As head of the William Davies Company, a massive meat-packing operation that would suffer if tariff walls fell, Flavelle had business dealings with Walker’s Canadian Bank of Commerce.
(Right: The Toronto Eighteen’s manifesto, as reprinted in Campaign of 1911 Against Reciprocity with the United States of America [Canadian National League, 1911].)
On February 20, Toronto’s Mail and Empire published a manifesto penned by 18 of the city’s leading Liberal businessmen led by Walker. Listing 10 points of opposition to the trade agreement, most of which had already been made at the Board of Trade or in other venues, the manifesto concluded:
Believing as we do that Canadian nationality is now threatened with a more serious blow than any it has heretofore met with and that all Canadians who place the interests of Canada before those of any party or section or individuals therein should at this crisis state their views openly and fearlessly, we, who have hitherto supported the Liberal Party in Canada subscribe to this statement.
In addition to Walker and Lash, the 18 signatories of the manifesto—which instantly earned the group the moniker, the “Toronto Eighteen”—were a who’s who of the city’s business and social establishment. Liberals all, most of whom had never been outspoken politically.
John L. Blaikie, president of the Canada Landed and National Investment Company, held a range of investments in the Canadian West. Wilmot Deloui Matthews, regarded by his contemporaries as “one of the shrewdest business men in Canada,” had diversified his portfolio from the grain trade to finance with the Dominion Bank, and eventually into cement and steel conglomerates. Hugh Blain had made his fortune in the wholesale grocery business, and, like many of the 18, had served a term as president of the Board of Trade. Financier Edward Rogers Wood founded the National Trust Company in 1898 and Dominion Securities in 1901, and served as a director of Bank of Commerce. John Craig Eaton had grown up in his father’s department store, honing his business acumen, then led the national expansion of the retailer, establishing outlets across the West.
“It is an impressive list of wealth and power,” historian Robert D. Cuff concludes of these and the other Eighteen. “These would-be Liberals formed an inter-locking structure of banking, transportation, insurance, manufacturing and other related interests.” News of their open revolt was proclaimed with three-column headlines in Conservative newspapers, and largely ignored in Liberal-leaning papers, like the Globe and Star.
(Right: Sir William Thomas White, ca. 1914. From the City of Toronto Archives, Fonds 1244, Item 8217.)
Many of the Toronto Eighteen had profited greatly by the country’s westward expansion, and saw themselves and their own fortunes as inextricably linked with the prosperity of a country as a whole. Walker and several others were firm believers in the idea of the businessman as nation-builder. For critics, however, the Eighteen’s efforts to preserve the high tariffs which had kept their profits high reeked of self-interest. They were more interested in preserving their own privileged place in society, some claimed, rather than the good of the country as a whole.
A handful of the Eighteen, like Matthews, had been strong, active party supporters. But Laurier questioned whether a number of the Toronto Eighteen had ever really been Liberals in the first place. R.J. Christie, head of the cookie company, had been “disgruntled” ever since English biscuits had been allowed into the country, one advisor suggested. William Thomas White was dismissed as being merely the mouthpiece of his employer at the National Trust Company, Joseph Flavelle. G.T. Somers, head of the Sterling Bank, was viewed as a good Liberal, Laurier’s insiders mused, but his ambition to selection election as president of the Board of Trade had forced him to follow the crowd. One Laurier lieutenant commented that he’d become aware William Mortimer Clark had ever been a Liberal when the businessman was appointed to a five-year term as Lieutenant-Governor of Ontario in 1903.
Clifford Sifton, the only Liberal who equalled Laurier in national prominence, had resigned from cabinet years earlier to sit as a backbencher in an ideological dispute with the prime minister. Now, in late February, after delivering a rousing speech in the Commons to announce his resignation from the Liberal Party over the question of reciprocity, he invited Walker to Ottawa to discuss strategy for defeating free trade.
Unable to attend the March 1 meeting, Walker sent Lash—with full authority to reach decisions on the banker’s behalf—to meet with Sifton and Borden. Also in attendance were Lloyd Harris, another Liberal dissident, and John S. Willison, editor of the Toronto Evening News, who had been forcefully campaigning against the trade agreement all winter.
(Left: Zebulon Aiton Lash, from Wikimedia Commons.)
Lash and Sifton presented seven conditions on which the Toronto Eighteen would enter into a “basis of co-operation”—in Willison’s words—with the Conservative Party to not only defeat the Reciprocity Agreement but also the Laurier government. Most of the conditions dealt with appointing key government officials and limiting the influence of Catholics and francophones. But Borden, who hadn’t even informed his party that he was meeting with disgruntled Liberals, also agreed to consult Walker, Lash, and Willison—none of whom held elected office—before naming his first cabinet to ensure “that there should be reasonable representation therein of the views of those Liberals who may unite with Conservatives against the policy of Reciprocity.” It was, Dutil and MacKenzie assess, “one of the most remarkable political bargains in Canadian history.” If Lash’s account is to be believed, Borden went further still, offering to resign as leader if the Eighteen thought another Conservative had a better chance of electoral victory.
The formal election had not yet been called, but by the spring of 1911 the Conservative campaign was well underway, with members of the Toronto Eighteen playing active roles. Businessman W.K. George, of the signatories to the manifesto, gave press interviews in the East, and Leopold Goldman, managing director of the North American Life Assurance Company, gave similar interviews in the West. When Borden approached White to help with the campaign, the general manager of the National Trust replied: “To tell the truth, I find it pretty difficult to keep out.” White would be the most active member of the Eighteen on the campaign hustings.
(Right: Portrait of Sir Robert Laird, no date. From the Library and Archives Canada [C-000170].)
That spring, members of the Toronto Eighteen were instrumental in the formation and financing of two ostensibly non-partisan organizations with the sole mandate to fight reciprocity: the Canadian Home Market Association (CHMA) and the Canadian National League (CNL). Both operated as propaganda machines, distributing talking points to Conservative candidates and editors for republication on the front pages, as well as flooding the country with nearly 10 million leaflets, reprints of speeches, and other materials by the end of the summer.
While, in the U.S., the Taft administration kept mum about the agreement for the most part, or released diplomatically worded statements about Canada remaining a distinct country, anti-reciprocity activists mined the congressional record and newspaper editorials for offhand comments from annexationists that could be exploited in the propaganda campaign.
A massive rally, organized by the CNL, was staged at Massey Hall on March 9. The meeting followed the established pattern of similar events elsewhere, with invited speakers lambasting reciprocity (with no rebuttal, of course, on offer), followed by the passage of a resolution calling on the government to call an immediate election.
Of the Toronto Eighteen, Gourlay, Eaton, and Allen appeared onstage—which was festooned with Union Jacks and a giant map of Canada—while White, George, and Lash made speeches, and Clark acted as host. Before a packed house, their speeches hammered away on the same points raised earlier at the Board of Trade and in the manifesto.
“This is not a question of party; it is a question above and beyond any parties,” Lash proclaimed, to give an idea of the evening’s tone. “This is not a question of the interests of individuals or classes or sections in Canada; it is a question of Canadian autonomy and Canadian nationality and the Canadian flag.”
Although a few Liberal supporters snuck in to heckle the speakers, they were drowned out by the crowd, which hissed at any mention of Laurier, and cheered approvingly any reference to Empire. The Toronto Star, which supported the Liberals and reciprocity, noted the enthusiasm displayed at the rally but suggested it arose “in the main by appeals to passion and prejudice.” The greatest applause, the Star‘s reporter claimed, was reserved for anti-American vitriol.
When Laurier finally called an election in the late summer, the Conservatives were more than ready. Half-a-million dollars or more had already been spent by the CNL and CHMA distributing anti-reciprocity propaganda. The Liberal Party couldn’t come close to matching that war chest, prompting one prominent Liberal to complain about the opposition’s “unlimited money.”
Moreover, due to Kemp’s heavy lifting, the party machine in Ontario had been thoroughly rejuvenated, and the Conservatives’ efforts were wholly supported by Premier James Whitney, who released a number of his MPPs to run federally. The party had accurate, constituency-level information about their own prospects in each riding, where additional, targeted campaigning was likely to unseat a Liberal, and which Conservative candidates stood the greatest chance in each community.
In contrast to the informed, efficient, and well-funded Conservative organization in Ontario, Laurier’s Liberal machine had languished, and the party’s weak efforts suffered due to disorganization, infighting, and inaccurate information gathering. The Globe and Star threw their weight behind the Liberal cause, the latter duelling with Willison’s Evening News through pro- and anti-reciprocity window displays erected at their respective offices. But even Laurier conceded Toronto as a lost cause, bypassing the Ontario capital to concentrate his campaign efforts elsewhere. Even if reciprocity hadn’t proven to be such a contentious issue, the Conservatives would likely have won in Ontario on the strength of their party machine.
On the campaign trail in English Canada, all issues—whether national or parochial—took a backseat to reciprocity, with both Liberals and Conservatives sincerely convinced they would win office on the issue.
During the formal campaign, some members of the Toronto Eighteen—and W. Thomas White, in particular—continued to make speeches and appear at rallies across Ontario, often under the auspices of the CNL. However, most—like Walker, who refused almost all requests to make public speeches—shrank from direct participation in the campaign, content to keep Conservative coffers full and to exert their leadership from behind-the-scenes.
At a major campaign rally at Massey Hall on August 23, Borden paid tribute to the Toronto Eighteen. “They are entitled to just recognition as men who have stood shoulder-to-shoulder with us in this fight to prevent national disaster,” the future prime minister exclaimed, “as men who have cast aside strong party ties for the sake and in the cause of a United Canada and a United Empire.”
In the wake of Borden’s landslide victory on September 21, the new prime minister followed through on his promise to consult Walker and Lash (through Sifton and Willison), resulting in the appointment of White, the member of the Toronto Eighteen who’d been most public and vocal in his support of Tory candidates during the campaign, as minister of finance. White stood for and won a by-election shortly afterward. Kemp, too, was rewarded for his part in securing the victory in Ontario with appointment to cabinet as minister without portfolio.
Sources consulted: Robert D. Cuff, “The Conservative Party Machine and the Election of 1911 in Ontario,” Ontario History (September 1965); Cuff, “The Toronto Eighteen and the Election of 1911,” Ontario History (December 1965); Patrice Dutil and David MacKenzie, Canada 1911: The Election that Shaped the Country (Dundurn, 2011); J. Castell Hopkins, Canadian Annual Review of Public Affairs (1911).