The Overstretched Superpower
Does America Have More Rivals Than It Can Handle?
AMINISTER from Brazil has just reached Canada. Opening the new legation, he will also formally open a new chapter in the Dominion's short diplomatic history. In the fourteen years since Mr. Vincent Massey went as first Canadian Minister to Washington, the Dominion has exchanged representatives with France, Japan, Belgium and the Netherlands. But in the Latin American field it has done nothing more than maintain a few scattered trade commissioners. Until late in 1940, the Government was politely but firmly negative to representations from inside and from outside the country suggesting closer ties with the Latin nations of the hemisphere. Then, suddenly, things began to happen. The Prime Minister announced that invitations to establish legations in Brazil and Argentina had been accepted. Almost immediately those two countries appointed their ministers to Canada; and similar overtures were received from Peru, Chile and Mexico.
These developments have been hastened, if not caused, by the war. Normally the actual or potential volume of trade with a country has been a major consideration in determining the establishment of a legation, and this factor has played some part in the present instance. For though there still is relatively little trade to lead Canadian diplomacy southward beyond Washington, war conditions have cut off or restricted overseas sources of supply and overseas markets both for Canada and for Latin America; and the hope of increased exchanges within the hemisphere is at least a gleam of light in a fairly grim prospect. It was to follow this gleam that a mission set out from Ottawa in November 1940, under the Minister of Trade and Commerce. The intention was a grand tour of the Americas; but unhappily the Minister fell ill at Cristobal and the whole expedition returned to its base, leaving only the correspondent of a financial journal to blaze the new commercial trail. At a favorable moment, we are told, the exploration is to be resumed. Meanwhile the Government has been exhorting exporters to apply to the Department of Commerce for information regarding possible markets in the Latin countries.
Yet the briefest glance at statistics will convince us that something more than the prospect of trade must lie beneath this budding of diplomatic relations with South America. In 1939 it required only $4,407,000 of imports to make Brazil the largest Latin American customer of Canada. Argentina was next, with $4,117,000. In 1940 Argentina took first place, with purchases in the amount of $6,107,000 (almost the whole of the forty percent increase being in newsprint). Brazil also bought more in 1940; but the total still was only $5,063,000. As for imports into Canada from Brazil and Argentina, these amounted in 1939 to $1,111,000 and $4,406,000; in 1940 to $6,243,000 and $6,542,000 respectively. Evidently a year of war did more than fifteen years of industrious trade commissioners. But the result is still far from impressive.
The figures showing the percentage held by various countries in the total trade of Canada are not yet available for 1940. In 1939, however, exports to South America were only 1.8 percent of Canada's total exports, while imports from South America were 2.8 percent of total imports. To the whole of North America, other than the United States, exports amounted to 2.9 of total Canadian exports; and imports from the same area were 2.3 percent of total imports. These figures state what is perhaps the chief reason why these countries have not bulked large in Canadian thought.
Nor is it by any means clear how a great and lasting expansion in this trade can take place. Canada will probably buy increasing quantities of cotton, coffee, linseed, fruits, hides and even wool; she may sell more lumber, more newsprint, a little wheat to Peru, more fish, conceivably some machinery and some textiles. But the fact remains that, as a manufacturing country, she can hardly compete in unprotected markets with the larger centers of mass production; while in respect of food and raw materials, her economy is largely competitive with, rather than complementary to, the principal countries of the hemisphere. In the matter of tropical products, a large part of her supply comes, under mutually preferential agreements, from the British West Indies and British Guiana. Such special privileges may give way after the war to a general lowering of trade barriers, but even so these established channels of exchange are not likely to be abandoned.
True, any potential new market is worth cultivation by a country that depends on exports, as Canada does, for thirty percent of its income. True also, the future may hold a rich development in the Caribbean and in South America. New capital and new initiative are flowing into these channels from the United States. The accompanying rise in general standards of living, with the obviously needed improvements in nutrition, may in the long term completely change market potentialities throughout that part of the world. But in Canada, at any rate, there is little tendency, either among economists or in government circles, to bank on optimistic predictions of hemispheric self-sufficiency.
The timing and direction of Canada's latest diplomatic expansion are not so much, then, a move in economic strategy as one manifestation of a new sense of general solidarity with the other nations of the West. As a sign of a continuing adaptation to environment the development is even more significant than the joint defense agreement with the United States.
In the Ogdensburg Agreement of 1940 the President of the United States and the Prime Minister of Canada set up a Permanent Board for the joint study of defense problems affecting the whole continent. This was a larger recognition of North American community and responsibility than Canada had ever previously made. But collaboration with the United States in fisheries, transportation, aviation, radio and other matters of common concern has been a familiar feature of our good neighborhood, and the Ogdensburg excursion into the vital field of defense was a natural enough response to common peril. Moreover, it has always been connected in the public mind with the destroyer-naval-base deal, and it was justified to Canadians of the imperial school as merely one side of a triangular British-American-Canadian arrangement for carrying on the war. To these people it looked as if the United States had said to Great Britain and Canada together: "Give us naval bases in the western Atlantic and coördinate your defense in this continent with ours, so that if the war does come this way we shall be strong to meet it. In return, we'll give you the things to fight with." Few thought of the fifty destroyers as more than a forerunner of much to come. Thus the defense agreement, interpreted as part of the price for desperately needed continuing help, was acclaimed even by those who in normal times would most stubbornly resist any Canadian move towards the American orbit.
The exchange of diplomats with Brazil and Argentina, on the other hand, is a volte-face. Hitherto Canada has held systematically aloof from all the broader aspects of inter-American activity. Officially she has scarcely acknowledged the existence of a world south of the Rio Grande. It was a vast unknown, worth scouting for trade, perhaps, and offering scope for some of the bolder power and traction enterprises. At Geneva delegates from Ottawa rubbed shoulders with polished diplomats who brought from both east and west of the Andes names that were often strangely Scottish or English. But as for direct association with these peoples, that was not really considered. Certainly it cannot be said that the "myth of the continents," so effectively demolished by Eugene Staley in the last issue of FOREIGN AFFAIRS, has ever figured prominently among Canadian illusions.
Opinion in the country corresponded, in the main, to the official attitude. A few Canadians spent winters in the West Indies or went on Caribbean cruises, but almost none extended these travels to South America. Three Canadian banks had numerous branches in these countries and maintained a certain exchange of personnel. One of them even published every two months a review of business conditions in the Latin American states and the British West Indies. Mining, power and traction enterprises financed by Canadian capital in Mexico, Brazil, Peru and Colombia distributed annual reports and quarterly dividends to shareholders in Montreal and Toronto. Some of the most biting criticism of Latin Americans and their ways came from men who operated or derived profit from these companies. Amid general ignorance, their supposedly experienced judgment had great weight. The impression spread that the peoples south of the Rio Grande were of such a different sort that the less we had to do with them the better.
These reasons for resisting Pan-American associations were reinforced by another objection. A hypersensitive loyalty to Great Britain and the Commonwealth made some Canadians shun a connection that might wean them away from the motherland and the other members of the family. They feared, too, that if they weakened the connection with England they would weaken their claim to England's protection and so be thrown into dependence upon the United States. If they had to depend on someone outside themselves, they preferred the old subordination.
All of these obstacles have shrunk in the last three years. Even before the war, the drying up of European markets owing to tariffs, quotas and exchange controls had worked curious changes in attitude. Several of the most British of the Canadian newspapers began urging the Government to take a hand in the Pan-American conferences and share in any compensatory trade arrangements that might be devised there. When France fell, some Canadians became suddenly much more aware than before of the advantages of the Dominion's autonomy and hastened to assure American friends and clients that the country would not become a German colony even if resistance broke down in the British Isles. Other adjustments to a swiftly changing world followed. There are few echoes in Canada now of the complacent superiority expressed about Latin Americans in the thirties.
We must not leap to conclusions. The fact that Canada is opening up diplomatic relations with Latin American states does not mean that she is joining the Pan-American Union. But the age of aloofness certainly is over. Through its representatives in Rio de Janeiro and Buenos Aires (others are to go later to Santiago, Lima and Mexico City), the Government at Ottawa will inevitably feel an increasing pressure for collaboration. Washington, too, will join in the persuasion, particularly if its present policy of strengthening the spirit and organization of Western Hemisphere solidarity is maintained.
How far the Dominion will respond to these urgings must depend to a considerable extent on how the war ends and what kind of world organization, if any, is set up afterwards. Hitler can consolidate his rule over Europe only by defeating Great Britain or forcing her to terms. If he can make her accept terms, Canadians might have two conflicting reactions. There would be a desire to make terms along with Great Britain; and there would be a determination to work in the closest collaboration with the United States in order to keep North America, at least, free. The latter desire would be supported by pressure from Washington, pressure amounting almost to insistence. Whether by her own desire, or as a result of such persuasion, Canada then would join in a program, defined for the most part by the United States, aimed at creating the strongest possible economic and political community on this side of the Atlantic.
We are even more concerned here, however, with Canada's voluntary adaption to the changing forces of her world, such as would follow the defeat of the Axis. Given the survival of Britain, the extent of Canada's collaboration with the Americas will depend in part upon the decision of the United States in the whole matter of world organization. If the United States again retires into isolationism, Canada will continue to maintain her familiar ambiguous position with one foot in Europe and one in North America. She might even throw a little more weight on the American foot, participating gradually in any inter-American activities which did not seem likely to imperil her special political or economic relations with the other British nations.
This time, however, the United States may decide that she must, in her own interest, participate in whatever plans are worked out to prevent the recurrence of war. She then will have to remain associated with the British countries for an indefinite period after the end of hostilities, so as to maintain order and set the stage for general organization. Will she favor a single society, in which all peoples will join? Or will she favor a number of groupings, determined by geographical or other ties, perhaps under some looser universal association? Recent developments seem to point towards the latter choice. If the United States Government goes on strengthening the inter-American system, in the effort to check Axis influence, it will probably want to preserve whatever solidarity it has achieved there as an element in the new world order. Nor, if present indications are any guide, will Washington any more than Ottawa be content to regard their coöperative defense of the continent as a mere emergency measure to be dropped as soon as peace is declared. The word "Permanent" stands out in the title of the Joint Defense Board. A prolonged war will add to the partnership of defense an economic and financial partnership which peace will not totally dissolve. Is it not likely, then, that the United States, binding to herself the Latin Americas on the one side and Canada on the other, will try to knit these elements together in one regional community? The final result must be full Canadian participation in the inter-American system.
In the past, one argument heard in Canada against membership in the Pan-American Union has been the alleged danger of troubling the infinitely more important direct relations with the United States. Ottawa might find itself opposed to Washington in some Pan-American matter, and that opposition would sour a vital coöperation. The objection was always rather childish. But in the circumstances now developing, the very opposite reasoning would appear valid. Canada's absence from the wider association would be apt to hamper relations with the United States, not so much because there might be resentment in Washington over the Dominion's aloofness, but for the simple reason that, as the community becomes more closely knit, an unintegrated unit that refuses to use the general machinery of coöperation will find itself in a position of increasing disadvantage.
It might have been expected that French Canada would take a well-defined stand either for or against a more intimate association with the other Latin peoples of the West. In fact it has not done so. For some years one important French newspaper of Montreal has advocated Canadian representation at Pan-American meetings, but the response has been indifferent. There is, however, an effective appeal which can be used at the proper moment. That is the invocation of the common religion and of the common Latin heritage of law and culture. Already there are signs that this avenue to the French-Canadian heart will not be ignored. An article by Professor Anatole Vanier, of the Université de Montréal, refers to recent discussions of the matter in which Latin Americans and French Canadians have joined, and shows that at least in university circles the opening up of diplomatic relations has aroused some enthusiasm. Professor Vanier lists the reasons for French-Canadian support of this development as follows: the common Greco-Latin culture; the widespread knowledge of French in Latin America; the historic position of New France as sharing with New Spain and New Portugal the glory of bringing the civilization of Europe to this hemisphere; and, finally, the advantage of increased economic interchange at a time when war has broken up the traditional channels of trade. It is characteristic of French-Canadian thought that the material profit should have been mentioned last.
Let us now attempt to strike a balance of the pros and cons. Chief among the factors working against Canada's participation in the inter-American system we must put down a reluctance on the part of those Canadians who have the strongest emotional attachments to the British Isles as their mother-country, or who believe in the permanent benefits of a closed British system of preferential tariffs. Add to this an unfavorable opinion, backed by the most inadequate knowledge, of the political and social qualities of Latin American peoples; an estimate that only insignificant economic profits would be gained; and a lingering fear that quarrels over Pan-American interests might in some way damage Canadian relations with the United States. On the positive side is the increasing recognition of Canada's identity of interest with the United States; a growing confidence in the good sense and good faith of that country in its Pan-American policy; and a fuller realization of Canada's responsibility to help make this hemisphere into the strongest possible base of resistance against the spread of totalitarianism. Few economists or businessmen see any hope that Latin America can provide an adequate substitute for European markets; but there is almost unanimous support for plans to increase the volume of hemisphere trade and reduce our economic dependence on continental Europe. The obstacles to collaboration seem, on the whole, to lack actuality. The living forces of the present seem to be moving towards the full integration of Canada in the hemisphere community.
What will be the effect of this new orientation on Canada's membership in the British Commonwealth? To answer this question, we must first inquire what that membership means. For most of its members, it means one reigning sovereign; a common nationality (in addition, usually, to a Dominion nationality); a strong tendency to rally around Great Britain in time of war; and, economically, preferential treatment in British markets. Yet to show how these connections may be attenuated we have only to mention the case of Eire. Without ceasing to be a member of the British Commonwealth, Eire is resolutely neutral in this war; holds that its citizens have only one nationality, namely its own; uses the mechanism of monarchy not for internal government, but only in external relations; and has conducted a bitter trade feud with Great Britain.
There seems no reason why a regional association should exclude cultural, economic or even certain political bonds with other groups. This is particularly true when the other bonds are as elastic as those of the British Commonwealth. Yet it may be not merely interesting, but practically important, to know which of several associations a state would put first if in critical circumstances a choice had to be made. Concretely, that question asks whether Great Britain and the Commonwealth would continue to play the chief rôle in Canada's external policy or would be ousted by the inter-American system.
We may hope that Anglo-American coöperation will continue to be so close that Canada will never be placed in the position of having to choose between joining Great Britain immediately, on the outbreak of a war involving that country, or waiting to take counsel with the United States and possibly other American nations. But if such a choice has to be made, the decision of Canada will depend, among other things, on the substantial value of the inter-American association and the extent to which its efforts and achievements have won the loyalty of the Canadian people. So far there is little ground upon which to base anything but an emotional prediction.
The monarchical government of Canada is sometimes mentioned as an obstacle to her membership in the Pan-American Union. Formally this is of no consequence. The documents of the Pan-American conferences use the terms "republics" and "states" interchangeably. In any event, the constitution of the Union is such that a mere resolution could remove any superficial difficulty of this nature. But the use of the English royal house as part of the Canadian system of government does have a bearing on the choice between an American as opposed to a British foreign policy. Even if constitutional lawyers end their debate by agreeing that identity of sovereigns does not involve identity of the British nations in war and peace, many Canadians will go on regarding themselves as belligerent when the King of England declares war. So long as the King of England is also King of Canada, this very natural confusion, though scarcely a determining factor, will have to be reckoned with in the ultimate issues of foreign policy.
We have probably heard the last of another confusion of thought which until recently made a good many Canadians tend to think of any closer association in a general American community as presaging absorption by the United States. The word that comes from south of the border these days is not one of manifest destiny stretching out towards the North Pole. Instead there comes an unmistakable hint that certain powerful interests, notably the wheat-growers of the Middle West, would strenuously oppose adding a parcel of Canadian states to the Union. The wholesome impression is growing that, far from having to fear absorption, Canada would experience some difficulty in persuading her neighbor to take her in. The bogey of annexation that stalked so fiercely thirty years ago is dead. Its burial has enabled Canadians to approach more dispassionately the problems of practical adjustment to their American environment.
When Colonel Lindbergh questioned the right of Canada to go to war without reference to the United States, the indignation which he aroused in his own country was hardly less than in the Dominion. In the American strictures on his speech, Canadians saw evidence of respect not only for their national independence, but of recognition that their part in the British Commonwealth was not without its advantages to the United States. As Americans realize more and more that British security is a prime factor in their own security they give increased approbation to Canada's contribution toward that end. There no longer seems any danger of the United States exerting pressure to separate Canada from the Commonwealth.
It has indeed been suggested in some American quarters that Canada might assume a more active and responsible rôle in Commonwealth affairs. Certain Americans seem to find Great Britain's ownership and administration of colonies in the Caribbean an irritating next-door exercise of imperialism, and Britain's lease of naval bases there has not put a stop to proposals that she hand over the colonies in payment of existing or future debts. A counter-proposal is that Canada should assume the part hitherto played by Great Britain in this area. An irritant in Anglo-American relations might thus be removed. And the device would not increase the difficulties of American sugar-beet growers or leave on the American doorstep the complicated social problems emphasized in Lord Moyne's report in 1939.
Canada has had preferential trade agreements with the Caribbean colonies since 1912. She maintains a subsidized steamship service between their ports and Canada. Canadian banks have twenth-five or more branches there. Trade commissioners from Ottawa are stationed in Trinidad and Jamaica. In 1938 Canada bought in the British West Indies, Bermuda, British Guiana and British Honduras products to the value of $20,343,569 and sold products worth $14,102,918. The war has improved the market there for Canadian goods, so that imports and exports in 1940 almost balanced at approximately $21,500,000. The amount still is less than two and a half percent of Canada's foreign trade.
These details hardly add up to enough to provide any substantial basis for urging the transfer of administration over the Caribbean colonies to Canada. It would not be difficult for Canada to supply the small number of troops now garrisoned there by Great Britain; and the naval problem is disposed of by the establishment of the United States bases. But Canada has no experience of colonial administration, and her people evince no ambition in that direction. Nor would the additional financial burdens involved in government and in carrying out social reforms be welcome.
There used to be talk of a union of all the Caribbean colonies, which could then join the Canadian federation as another province. This idea holds little attraction for Canadians, many of whom would shrink from taking on the native problem as a factor in their domestic life, and who would see disadvantages in throwing their industries open to labor from the islands. Moreover, it makes little headway in the colonies themselves. Progressive elements there are still working towards federation, possibly in the form of two unions centered respectively upon Jamaica and Trinidad. But the minimum they contemplate for these unions is distinct Dominion status.
One step of Canadian "expansion" does seem likely. Newfoundland's absence from the federation has always been something of an anachronism, and several very tentative approaches have been made from one side or the other towards union. On the only occasion, however, when Newfoundland displayed any real warmth towards the project her finances were in grave difficulties, and Ottawa was unwilling to take on an additional debt and new burdens. That was in 1895. In 1934 financial troubles brought about the suspension of the island's status as a Dominion and the substitution of an administrative commission appointed in England. Again the idea of federation with Canada came under discussion, this time quite unofficially, but no enthusiasm was exhibited on either side. Now Newfoundland has a United States naval base and a mixed Canadian-American garrison, and thus bulks large in the activities of the Permanent Joint Defense Board. These strategic considerations may in future outweigh bookkeeping caution at Ottawa. In Newfoundland, protracted economic stringency, coupled with the experience in commission government, must have awakened doubts as to the very possibility of separate autonomy. This is important, because the people of Newfoundland must desire inclusion in the Canadian federation if any such move is ever to materialize.
Clearly Canada's part in the community of the Americas will not be as a center of any new imperialism. She has room and to spare within her present boundaries, and problems and to spare. Nor is she pleased with the dreams some people have of hemispheric autarchy. Her heavy accumulation of wheat gives her a keen interest in the Havana plan for the financing and orderly marketing of Pan-American export surpluses. She will keep an eye on the activities of the Inter-American Financial and Economic Advisory Committee and its subsidiary, the Inter-American Development Commission. The effort of the United States to develop Latin American industries, to stimulate production of commodities hitherto purchased overseas, and to increase the inter-American exchange of surplus products, will engage her earnest attention. But she will continue to regard the reopening of European markets as a necessity for her economy.
Coupled with this economic interest in the world outside the Americas, the Canadian people have a warm sense of fellowship with the other British nations. It is fully as important as any abstract devotion to democracy in explaining why Canada will be less than satisfied with a limited association designed merely to serve the security and welfare of the Western Hemisphere. The urge to assist all communities struggling to defend or to reach a liberal way of life will continue to be a feature of the Canadian national character. And a liberal way of life is not, in the Canadian view, simply a question of formal political democracy. It implies progress towards equality of economic opportunity for all with the will to work.
Confronted now with tasks and with perils that exceed anything in its previous history, adventurous though it has been, the Canadian nation is buoyed up by an undercurrent of strong optimism. It is perhaps a surviving characteristic of the frontier that beyond the dangers of these present years the future is still looked upon as inevitably holding great things for the country. Even sceptical observers foresee that new forces will thrust upon our northern people a larger rôle in world politics. There already is evidence that in the war's train will come an influx of immigrants of the most desirable type. We shall emerge from this struggle with a vastly augmented industrial production. The strengthening of our partnership with the other nations of the Americas brings new courage to face the formidable problems of post-war adjustment. Given a world in which international trade is possible, Canada will grow in population and power. She may be counted on to display two fairly constant qualities -- a sturdy good sense which will continue to make her a reliable neighbor; and a generosity of outlook which will incline her to share actively in any practical and vigorous plan of world order.