The Hub is pleased to present a weekly column from author and historian Antony Anderson on the week that was in Canadian history.

April 25, 1849: Canadians burn down their Parliament building

The world had been falling apart for quite some time. By the late 1840s, property prices had collapsed, bankruptcies abounded, and mills sat idle. Merchants and farmers had been stabbed in the back by the Mother Country which, in 1846, had repealed the Corn Laws that allowed Canadian “corns,” i.e. barley, oats, and wheat, into the British marketplace with minimal duties; the precious imperial preference snatched away, consigning loyal colonials to compete with foreigners in a harsher contest of freer trade. Some began to dream of annexation to the richer, prosperous southern republic.  

Economic calamity was conjoined with political turmoil. After the rebellions a decade before, Upper and Lower Canadians—Protestant, Catholic, francophone, anglophones of Irish, Scottish, Welsh, English descent, former Americans, all so multicultural—had been shoved into an unholy legislative union in 1841, becoming Canada West and Canada East within the united Province of Canada. In this face-to-face collision, electors and elected were, at the same time, grappling with a new scheme: responsible government, foisted on them with the full contrivance, again, of London.

Now the pampered and precious—who had been used to a world where good breeding had opened doors to plum patronage posts bestowed by friends and relatives enjoying their own plummy posts —had to endure a House of Assembly where their social inferiors had been chosen by the rabble and worse, where traitors had elected traitors who insisted on speaking French and demanding equality of status and treatment. Was God no longer an Englishman?  

The rebellions of the 1830s—disorganized, flailing skirmishes really but unnerving nonetheless—continued to send aftershocks through the Canadas. Once the military had put down the rebels, and the judiciary had hung some of them and cast others into exile, individuals came forward seeking financial compensation for damage caused to their property by vandals and looters and in some cases, zealous government troops. Anglophone claimants in Canada West received compensation while—illogical, hypocritical—anglophone members in the new legislative union raged that any compensation to the francophones in Canada East was reward for treason. French claims were bogged down in debates and delays.

On January 30, 1847, into this slough of despond came the new governor general, James Bruce, 8th Earl of Elgin, 12th Earl of Kincardine, dispatched to cajole rather than coerce entangled politicians into being responsible and responsive. His mission was daunting, made even more so, as he lamented in private, by “the materials with which I have to work in carrying out any measures for the public advantage. There are half a dozen parties here, standing on no principles, and all intent on making political capital out of whatever turns up.” Perceptive, charming, blessed with a disarming modesty of manner, he was exactly the right man for the crisis. And best of all, he knew his place

In February 1849, the Rebellion Losses bill formally turned up in the House of Assembly, then located in Montreal, the capital being a moving target in those days, alternating between French and English cities. The debate on compensation was, on the surface, about the money. Really, it was about anglophone prejudices and fears, about losing power, about having to live in a world that was making less sense. All too often, anger buried reason and middle grounds seemed to crumble on touch.

During one session, a fistfight broke out in the visitors’ gallery. In another, a young conservative politician from Kingston became so infuriated he challenged one of the government members to a duel and strode out of the House. The sergeant-at-arms raced to fetch the enraged member, a certain John A. Macdonald, and escorted him back to his seat so tempers could cool without shots being fired. 

As an outsider to this sectarian feud, Elgin could afford to be emotionally detached. Naturally inclined to moderation, he worked with moderates on all sides to get the bill passed. The conservatives flooded him with petitions, trying to bypass the legislature, hoping he might dissolve the House or repeal the bill or punt it over to London where it might be suffocated. “The Tory party are doing what they can by menace, intimidation, and appeals to passion to drive me to a coup d’Ètat.” Elgin ignored these backstage machinations, knowing they could trigger another francophone rebellion and threaten the fragile union.

So he stuck to his radical plan: let the Canadians sort their messes out themselves in public. Thanks to brilliant diplomacy conducted by Premier Louis-Hippolyte Lafontaine and his right-hand man, Robert Baldwin, anglophone reformers from Canada West joined their reformist colleagues in Canada East to get the bill passed. (That is another story for another time.)

On April 25, 1849, Elgin ventured to the legislature, housed in the St. Anne’s Market building, to bestow royal assent. Duty performed, he left the building, striding through a crowd both cheering him and shouting abuse, and got into his carriage whereupon a handful of “persons of a respectable class in society” threw rocks and eggs at him. Elgin escaped without injury but the mob was not satisfied. An anglophone newspaper ran a special edition declaring, “Anglo-Saxons! You must live for the future. Your blood and race will now be supreme, if true to yourselves.” It called for a mass rally.

Some 1500 people gathered that evening at Champs de Mars, a large park in the heart of Montreal. In the glow of burning torches, hatred was spewed and farmed until a grievance convoy broke away and headed towards the legislature building. Members of Parliament were still in session debating a bill on courtroom procedures. Suddenly rocks shattered windows. The locked front doors to the building were battered open by the captain of the volunteer firefighters and a notary using the firefighters’ own ladder. The elected members duly fled from the invaders, rescuing the portrait of Queen Victoria on the way out. One of the mob members sat in the speaker’s chair and proclaimed the House dissolved. The intruders felt entitled to smash anything they could, including at least one chandelier fed by a gas pipe and indeed quite a few other gas pipes. Some flung their lit torches into the building. Flame mixed with gas and a fire broke out and spread, burning this makeshift Parliament building to the ground, including the 20,000 books in the library.

The next evening, gangs roamed the streets, attacking the homes of prominent reform politicians. Government troops needed another day to restore the peace. “I confess,” Elgin wrote in a private letter, “I did not before know how thin is the crust of order which covers the anarchical elements that boil and toss beneath our feet.”

The abused but undaunted governor general was invited to receive a formal apology from the House and mindful of keeping up the appearance of order, rode into town escorted by troops. Once again, the good people of Montreal threw stones at his carriage and then as he left, chased him in their cabs and carriages, throwing more rocks and curses. Elgin decided it would be prudent to remain out of town and out of view for the next few weeks so the anglophone mob would have no cause to riot again and likewise, the francophone populace would lack any excuse to rise to his defence.

In stark contrast to European governments dealing with their own riots the year before, neither Elgin nor the reform government responded with violence. He maintained his much tougher path of moderation. Author John Ralston Saul argues this is one of the defining moments in Canadian history. 

The immediate temper cooled. The economy eventually picked up. Democracy, such as it was in the cantankerous province, went on evolving as francophones and anglophones kept on learning to live with each other. To defuse the annexationist threat, Elgin negotiated a trade deal with the United States, the Treaty of Reciprocity (1854–1865) which lasted until the republic collapsed into civil war. Suddenly British North America looked like the better choice. In one letter, he had noted in passing, “We must take the world as we find it.” Good thing he ignored his own advice. He had helped the young province from sliding into its own civil war.

In The Weekly Wrap Sean Speer, our editor-at-large, analyses for Hub subscribers the big stories shaping politics, policy, and the economy in the week that was.

What’s behind the capital gains tax increase?

Although the prime minister had already announced most of its signature measures over the previous week or so, this week’s budget still contained one notable surprise: an increase to the capital gains tax rate for capital gains above $250,000 for individuals and at any level for corporations and trusts. 

We had anticipated the budget would set out tax increases for corporations and high-income earners—in fact, the March 9 edition of the Weekly Wrap warned that the budget might “appeal to class warfare”—but we didn’t expect changes to the capital gains tax regime. The disincentives for entrepreneurship and investment seemed too high in the face of a stagnant economy, low business investment, and declining productivity. 

The budget proposal, which is projected to raise nearly $20 billion in new revenues over the next five years, has generated significant criticism from entrepreneurs and investors who rightly warn that it will discourage business start-ups and capital investment. Calgary-based investor Derrick Hunter has written about these risks for The Hub. 

At a time when the Canadian economy is in high demand of capital to expand the housing supply, increase business starts, and boost productivity, this is a counter-productive policy. There’s a considerable body of research that shows that capital taxes are among the most economically damaging forms of taxation. The economic costs of extracting this capital from investors and handing it over to the federal government are therefore likely to be significant. Especially since it wasn’t offset by accompanying tax reductions as Hub contributor Trevor Tombe set out in his post-budget analysis. 

It prompts the question: why is the Trudeau government doing this? 

We know for instance from former Finance Minister Bill Morneau that it’s been something the government had considered and rejected in the past. It strikes me that there are three explanations for adopting it now. 

• Politics: The government hopes to bait Pierre Poilievre and the Conservatives and/or parts of the business community into a fight in which the prime minister can reposition himself as on the side of middle-class Canadians. His gratuitous use of the “ultra-wealthy” in recent days to describe those affected by the policy change is a sign that the government is in search of a wedge issue. 

• Fiscal anchor: Between the 2023 budget and Fall Economic Statement, the government committed to lowering the debt-to-GDP ratio on a year-over-year basis, and without the new revenues from the tax change (particularly the windfall in the current fiscal year) it’s quite likely it would have once again broken free from its anchor. This would have not only set up the government for political criticism, but it may also have increased the likelihood that it faces a credit downgrade for its lack of fiscal credibility.  

• Ideology: The most underrated explanation is that the Liberal Party itself has evolved from a centrist party with corporate sensibilities to a much more progressive party that’s skeptical of capital and more predisposed to income redistribution and an activist state. This point cannot be overstated: it’s notable for instance that the budget change reverses a cut to the capital gains tax rate enacted by the Chrétien government in 2000. 

Whatever the ultimate balance of factors behind the government’s decision, the economic effects are still the same: hiking taxes on capital is bound to worsen Canada’s investment climate and ultimately its economy as a whole. 

Generational fairness requires prioritizing growth

The Trudeau government has sought to define this week’s budget in terms of “generational fairness.” It spoke for instance of the need to “restore a fair chance for Millenials and Gen Z.” Finance Minister Chrystia Freeland’s budget speech even claimed that we find ourselves at a “pivotal moment” for these cohorts. 

This political positioning is understandable yet insufficient. There’s plenty of evidence that younger Canadians are feeling anxious and agitated about their circumstances. They cannot afford homes. They’re delaying marriage and family formation. And, as we outlined this week in The Hub’s first bi-weekly DeepDive, they’re increasingly unhappy. 

The numbers are striking. Younger Canadians used to report higher levels of happiness than older Canadians. Not anymore. Canadians under age 30 are now on average less happy. Canada’s overall level of satisfaction ranked number 15 in this year’s World Happiness Report. But if you limit it to younger Canadians, we actually fall to number 58 along with countries like Paraguay, Malaysia, and China. 

There’s a tendency to observe these dynamics through the lens of politics. A key reason that the budget is so focused on this cohort is because it has abandoned the Liberal Party en masse. The Conservative Party of Canada is the only centre-right party in the Anglo-American world that currently has a political advantage among younger voters. These developments challenge long-standing political axioms about the interaction between demographics and political preferences.

But the biggest issue here isn’t politics. There’s something far more concerning about the demographic, socio-economic and even psychological effects of large numbers of young Canadians experiencing  “failure to launch” syndrome. It can have long-run costs and consequences for individuals and society as a whole.  

It’s not a coincidence for instance that the fertility rate is at an all-time low at the same time that Canadians under age 30 are reporting rising levels of unhappiness. Causality is doubtless working in both directions.  

An unmarried, childless future in an ugly and overpriced, small downtown apartment is a rather grim proposition. Nothing in the totality of human experience tells us that these are the conditions for human flourishing or a successful society. 

Some of the budget measures may help on the margins. But one does get the sense that there’s something bigger going on here and technocratic solutions are a necessary yet insufficient response. Howard Anglin’s article for The Hub this weekend about building aesthetics, textured neighbourhoods, and what Tim Carney calls “family-friendly” communities starts to get closer to some of the underlying factors behind this generational malaise. One could also point to the void of spiritual questions—though that’s beyond the scope of public policy and certainly this essay. 

I would however make the case for a lack of growth and progress as a key (and perhaps the key) explanatory factor. Here I may respectfully part company with Anglin. I don’t think that people are telling us that things are moving too fast. I think in a lot of ways they’re telling us that they’re moving too slow. I subscribe to the Douthian argument that economic and technological stagnation (outside of narrow cones of progress), cultural conformity and replication, and the absence of a common project have contributed to a self-reinforcing mix of stagnancy, sterility, and drift. 

Douthat’s solution to what he calls “decadence” is a combination of divine intervention and renewed technological progress (“So down on our knees—and start working on that wrap drive.”). 

Maybe he’s right. But either way, these are the precise questions that we ought to be asking before we consign a generation or two of young Canadians to an uninspiring and unfulfilling future. 

This might finally be the Maple Leafs’ year

Today marks something far more important than politics or public policy: it’s the start of the NHL playoffs and the Toronto Maple Leafs’ elusive search for their first Stanley Cup since 1967.

George Will likes to say that he writes about politics to support his baseball habit. I can relate. The only job that I can envision leaving The Hub for is really any role with the Maple Leafs, from team president to the guy who fills the water bottles.

I’ve loved hockey ever since I can remember. I played a lot as a young person—though not particularly well. I recently wrote about my playing days, including the occasional fight, for Cardus’ Comment Magazine. You can find my essay here.

Will also often says that at an age too young to make life-shaping decisions, he had to choose between becoming a Chicago Cubs fan or a St. Louis Cardinals fan. Most of his friends became Cardinals fans and grew up cheerful and liberal. He chose the Cubs and grew up a gloomy conservative.

Again, I can relate. Being a Leafs fan is good training for a conservative. It’s a steadfast lesson in low expectations and the inherent fallibility of man.

But I’m a North American conservative so I’m susceptible, however wrongheaded, to a unique continental optimism. I can’t help but succumb against my better judgment to a quixotic hopefulness.

No matter how hard one tries, the Leafs invariably tempt you into believing that this year is different. Last year’s first-round win against the Tampa Bay Lightning set off those feelings for me. The swift second-round defeat to the Florida Panthers caused a precipitous fall back to reality.

This season I’ve once again watched most of the games. I began the year determined to protect myself from inevitable disappointment. But somewhere along the way, perhaps due to Auston Matthews’ 69 goals or the group-think of my hockey chat groups (yes, there are two), I’ve come, at an almost sub-conscious level, to believe that this might be the year.

If so, I’ll need to bring my boys to Toronto for the parade because even though they’re only one and three years old, there’s a good chance that it won’t happen again in their lifetimes.

I suppose this is a long way of saying that if I’m a bit distracted in the coming days (and hopefully weeks) it’s because I’m focused on my real passion: hockey. Hopefully, politics and policy will cooperate and take a break for a while.

Until then, Maple Leafs forever!