Why did MacDonald develop the National Policy?

John A. MacDonald created the National Policy in 1876. The three main parts of the policy was a system of protective tariffs, increased immigration, and the CPR. The voters agreed with MacDonald when him and his party went back they had a large majority.

List and explain each of the three parts of the National Policy.  In each case, state why MacDonald thought it was important for the future of Canada.

The National Policy had three main parts, a system of protective tariffs, increased immigration, and the CPR. The protective tariffs was when the taxes would be raised from 15% to 17.5-35%, sometimes double what they were before. MacDonald did this because he wanted Canadians to buy less goods from America and instead by more in Canada to benefit the Canadians economy. MacDonald also wanted increased immigration because it they had more farmers producing more crops, many Canadians would be able to purchase these goods from Central Canada, again benefiting Canada’s Economy. It would also be better to have increased immigration because it would protect Canada from American annexation. The CPR was the third part of the National Policy and MacDonald thought that it was important to build it because they would then have a quicker way of transporting troops for the defense of Canada. Also, it would help with the trading of goods within Canada and for people to travel across Canada efficiently.

Who did MacDonald get to invest in the CPR and what were their backgrounds?

Macdonald found the men he was looking for in George Stephen, president of the Bank of Montreal, Donald Smith of the Hudson’s Bay Company, and James J. Hill. Previously, they had purchased the floundering St. Paul and Pacific Railway for just $100 000. Within four years, they had made a profit of $17 million.

What did MacDonald promise the Syndicate?

In 1880, Macdonald made the group of investors an offer of $25 million in cash, a land grant of 25 million acres, and a monopoly west of Lake Superior for 20 years. In return the CPR would have to be finished in 10 years.

In order to get the benefits from the Government, what did the Syndicate have to do?

In return, the new CPR Syndicate was to complete the railway within 10 years.

What did the Syndicate do immediately upon being given the railway contract and why?

Immediately they changed the route of the railway, the route that they changed was a good farming land and many land speculators had moved there to buy and then sell the land. So they changed the route of the CPR 300KM south. This now gave the Syndicate total control over the railway.

Why was William Van Horne hired as the new manager of the CPR in 1881?

The Syndicate needed a new manager so they hired William Van Horne because he had exceptional drive and energy.

Describe the achievements of Van Horne’s management.

When Van Horne arrived he was energized and brought a high level of efficiency into the project. When railways were all built by hand he was able to 800km laid in 1882 and another 800km the following year, This was make sure that they would meet there contract.

What problem did the railway face in 1883 and what was the solution?

BY the end of 1883 the company was almost out of money. They were not even done the most costly and difficult part of British Columbia. So George Stephen and Donald Smith both put in their entire personal money, but that was still not enough. IN the early 1884 the Canadian government put in $22.5 million. After the grant Van Horne then made some expense cuts.

Where did the CPR enter into BC?

As the CPR was being built across the southern Prairies, the route through British Columbia was still being studied. Because of the CPR money troubles, the railway entering BC had to go through the Kicking Horse Pass which was further to the south instead of the Yellowhead Pass.

In 1867, why do you think the coast of BC required fewer days to get to from Ottawa than the interior of BC?

It required less time to get to the Coast of BC because you were able to travel by sea and go all the way around North America which was still quicker than traveling over land to get to the interior.