Document Information

Date: 1866-08-07
By: Province of Canada (Parliament)
Citation: Province of Canada, Parliament, Scrapbook Debates, 8th Parl, 5th Sess, 1866 at 79-81.
Other formats: Click here to view the original document (PDF).
Note: All endnotes come from our recent publication, Charles Dumais & Michael Scott (ed.), The Confederation Debates in the Province of Canada (CCF, 2022).

Click here to view the rest of the Province of Canada’s Confederation Debates for 1866.

LEGISLATIVE ASSEMBLY

Tuesday, August 7, 1866

Withdrawal of the Education Bills—Resignation of Mr. Galt.

Hector-Louis Langevin [Dorchester, Solicitor-General East] moved

The Lower Canada education bill be now read a second time.

John A. Macdonald [Kingston, Attorney-General West and Minister of Militia] said his hon. friend moved the second reading of this bill for the purpose of giving him the opportunity of making the statement to the House, which he was now about to do, with regard to their changed position upon this bill. The government felt that there would have been no difficulty in carrying this bill had it been allowed to stand alone. They were fully convinced of the liberality of sentiment of the Lower Canada majority; there was no doubt as to the course of that majority upon the bill; they were quite willing to concede to their Lower Canada fellow subjects of British origin the privileges which it was designed to give them. But a similar bill had been introduced by the member for Russell [Robert Bell] for Upper Canada[1], giving to the Catholic minority of Upper Canada precisely the same privileges. The Government found beyond doubt that there would have been a very large majority from Upper Canada against that bill. All the members from Upper Canada, but himself, were prepared to vote against it.

The government had also found that there was a strong feeling, and a very natural feeling, among the Catholic majority of Lower Canada, that their co-religionists in the west ought to enjoy the same privileges as they were willing to give the Lower Canada minority, therefore made a difficulty in the way of carrying the Government bill, which by itself would have passed with a large majority. Had this bill been pushed, the other bill would have been pushed also, and the singular spectacle of a bill for Upper Canada being carried by Lower Canada votes, and a bill for Lower Canada by Upper Canada votes would have been presented.—This would have been a most unfortunate occurrence. These were not like ordinary bills; if passed they would have been a fundamental part of the constitution of the country.

It was not desirable, therefore, in the present position of affairs that such a result should have been produced. Canada, instead of starting in harmony under Confederation would enter it with the worst feelings of division aroused, presenting to the other Provinces the spectacle of a double minority, instead of a double majority[2]. It was seen that the most unfortunate consequences could not but have followed the pushing forward of the Lower Canada bill consequences which the Government felt bound to avert.

The Government, therefore, with the deepest regret had come to the conclusion to abandon this bill. The minority in each section would have to throw themselves on the justice and generosity of the majority. He had no fears that any injustice would be done to the Lower Canada minority; the majority in that section had given too many proofs of their liberality to doubt of it. But in Upper Canada the liberality of the majority had not yet been tried. He hoped, however, that the majority there, feeling strong and powerful, would act in a spirit of generosity. Though he very much regretted that circumstances had compelled the Government to abandon the bill, the most painful part of his announcement had yet to be made. The hon. Minister of Finance [Alexander Galt], who had taken a very particular interest in this bill, had felt it to be his duty to tender his resignation, when his colleagues had come to the conclusion to drop the bill, and his resignation was now in the hands of His Excellency [Viscount Monck].

His hon. friend had been in an especial manner the guardian of the rights of the Lower Canada minority. He had felt, therefore, that in view of the abandonment of this bill, which was considered of so much importance by them, that he should withdraw from the Government. The only consolation to him (the Attorney-General) was that he had withdrawn with every feeling of intimacy and friendship. He also begged to say that the late Minister of Finance [Alexander Galt] had kindly consented, at the solicitation of the Government, to continue to take charge of those measures still before the House, appertaining to that department. The abandonment of the School bills enabled the Government to state their expectation of being able to close the business of the session on Saturday.

Alexander Galt [Sherbrooke, Minister of Finance] felt bound to say, in all candour, that the course of the Government was what was demanded by the circumstances of the country, but it was not a course which he could sanction. It was not because he thought the interests of the Protestants of Lower Canada would be jeopardized, in the

• (p. 80)

hands of the Lower Canada majority, that he had taken the course, for he was bound to say that he had every confidence in the liberality of that majority. He said this in justice to his friend the Attorney-General East [George-Étienne Cartier], but the Government had found that they must merge their duty of protecting the minority, in the greater duties of protecting the peace and harmony of the whole country. It was not a light thing for him that he should have to retire from the Government at this time, and to part with colleagues who he had been associated with so long a time. With regard to the Roman Catholic minority of Upper Canada, he felt bound to say that it would be dangerous to give them anything like a just cause of complaint. He begged also to say that his Lower Canada colleagues had shown no disposition to recede from the ground which the government had taken until circumstances had rendered it necessary.

John Sandfield Macdonald [Cornwall] was very glad to learn that these bills had been withdrawn. He had predicted these dangerous consequences, which had already manifested themselves upon this question, when the Quebec Scheme[3] was first submitted. He had pointed out that the placing of special privileges beyond the reach of the majority would lead to consequences such as those which the United States had suffered on account of slavery.

He was glad that the Government had made this concession to the opinion of Upper Canada.—He was not afraid that the Catholics of Upper Canada would not receive full justice from the Protestants of Upper Canada; and was sure that as the Protestants of Lower Canada had never had occasion to complain in the past, they would be equally justly treated in the future. He would think it a great misfortune if the carrying out of Confederation was taken out of the hands of those who had forced it upon the country. He considered it a foregone conclusion, but looked to its condemnation in the future, though it would take years to remedy its detects.

Joseph Cauchon [Montmorency]—By the position of members on the school question he expected a crisis, but not to the extent which had occurred. He exceedingly regretted the resignation of the Minister of Finance [Alexander Galt], and hoped the country might soon again have the benefit of his services. At the time of the adoption of the Confederation scheme, it was understood that the separate school law of Upper Canada was not to be interfered with, and that the Lower Canada law was to be changed in some particulars, but the Protestants of Lower Canada now claimed privileges which they should not have asked. Though he was not opposed to these privileges, yet he looked upon it as an unjust suspicion upon the conduct of the majority in the future, which their conduct had not deserved in the past. He regretted that government had not confined the bill to the points upon which they were originally pledged, then they would not have excited the jealousy of the Catholics of Upper Canada, nor would they have met with opposition from any part of the country.

John Pope [Compton] said the Protestants of Lower Canada had never yet complained of injustice from the Superintendent of Education, but the representatives of the minority could not convince those who had sent them here that everything would be right and secure for them, they could not quiet those who went round the country agitating the minds of the people setting class against class, without those guarantees which they had asked, and they (the British members from Lower Canada) had pressed upon the Minister of Finance [Alexander Galt], as their representative, to secure them these guarantees. They had given up much in consenting to go into Confederation, and surely the concession of these guarantees would forever prevent the re-opening of agitation upon this subject. He was glad that the Minister of Finance [Alexander Galt] had left the Government, it was the only honorable course to him, and the country would respect him for having stood to his pledge.

Christopher Dunkin [Brome] bore testimony to the fair and impartial conduct of the Lower Canada Superintendent of Education. He then replied to the remarks of the hon. member for Montmorency [Joseph Cauchon]. He read from the debates on Confederation, to show that the Protestants of Lower Canada would receive such privileges “as would satisfy them in the management of their schools.”[4] He would not say now whether the bill could have been carried or not, though he firmly believed that had ministers seen their way to carry it without great injury to the country, they would have done so.

But with regard to the part of the bill which the member for Montmorency [Joseph Cauchon] regretted that it had not been taken up, he decidedly preferred the course that had been followed. It was more manly, more honorable. They had tried, they had failed, and they had abandoned it. He also contended that the two systems of Upper and Lower Canada, with regard to education, were totally different. As the case now stood the Protestants of Lower Canada would now have to take their chance, and that chance, he firmly believed, would be a good one.

Antoine-Aimé Dorion [Hochelaga] regretted that the member for Compton [John Pope] and the other township members, had not always felt the same confidence in the Lower Canada majority which they now expressed. Had they done so, they would not have driven the member for Sherbrooke [Alexander Galt] from his present position. These gentleman had been caught in their own trap. They had sold their constituencies to the Confederation scheme, for this pledge upon the school question, and now they lost their guarantees. He thought the honorable Minister of Finance [Alexander Galt] had taken an exceedingly honorable course, and he believed that ministers had done everything in their power to carry that bill, but they found it impossible.

He had no doubt of the justice of the majority in Lower Canada, they would give the Protestants every privilege that might be deemed necessary, while he should have contended that the Catholic minority in Upper Canada should have received equal privileges with the Protestant minority of Lower Canada, and the majority of Upper Canada would have only shown themselves more illiberal, more bigoted, by refusing this, still he believed it was better for the minorities in each section, to trust to the justice of their claims and the impartiality of the majority. He believed several provisions of the bill, which was now withdrawn, exceedingly objectionable, in tying the hands of the legislature of the country, as to the future appropriations of the money, no matter what might occur.

George Brown [Oxford South] congratulated the Lower Canadians the they were to be relived from the obnoxious school law which the government designed to impose upon them. He was glad, too, that legislation was not to be disturbed upon this question, and particularly glad the session was to close so soon and hoped that ministers would hasten to England, and get Confederation accomplished as quickly as possible. He contended that the rights of the minority would always be better protected when left to the justice of the majority. He thought that the Catholics of Upper Canada would be very glad to learn the they had been relived of a bill which would have entailed upon them very great additional expenses. He would not be expected to express his regret at the Minister of Finance’s [Alexander Galt] resignation on public grounds. He was glad upon them grounds that his hon. friend had resigned, and it was exceedingly creditable to the hon. gentleman that he had acted from a high conscientious principle.

Thomas D’Arcy McGee [Montreal West, Minister of Agriculture and Statistics]—It was not extraordinary that the minority East and West had desired to protect themselves in their fundamental rights. It would have been very extraordinary if they had not. Had not the people of Scotland stipulated for their own laws in the Union with England[5]? Had not Ireland made stipulations as to its rights[6]? Had not guarantees been given to minorities in every Federal Union of States that had ever taken place. He was not afraid himself to trust to the Upper Canada majority, and would not say a word to alarm the feelings of the Catholics, but it came with bad grace from the member for South Oxford [George Brown] to speak for the Roman Catholic feeling, unless from the experiments tried on it. If any man had experimented upon that feeling for upwards of twenty years he had done so, and he might well venture to speak for the Catholics of Upper Canada.

He (Mr. McG.) said it would have been far more for the honor of this House, far better for the peace of the country, had they agreed honestly to take up the case of the two minorities and settled them fairly. We were sending the minorities East and West adrift with feelings of insecurity as to their future, which this House could have removed by frankly dealing with the case. Since that cannot be done, the best that could be was to leave to work out their own case in each section. He referred to the security which the minorities in each section had felt under the United Parliament, which would now be taken away.

George Brown [Oxford South] contended that the cases cited by Mr. McGee bore no analogy to that of the minorities of Upper and Lower Canada.

Matthew Cameron [Ontario North] did not regret that the bill had been withdrawn. He believed the Lower Canada Protestants, and the Upper Canada Catholics, would be perfectly safe in the hands of the majority. If their rights were to be invaded once it would be followed with such an entire change of circumstances as would make its repetition impossible. He did regret, however, that the hon. Minister of Finance [Alexander Galt] had been compelled to resign upon a question which did not concern his department, but one of the Government at large, while his colleagues had not gone out of office with him.

He dissented from the tone of the remarks made by the Attorney-General West [John A. Macdonald] and the late Minister of Finance [Alexander Galt], regarding the Catholics of Upper Canada, one of which might bear a construction that there was a time when they could be treated unjustly, and the other that their loyalty might be suspected. He contended that the Catholics of Upper Canada could have no cause of complaint that a bill which had been promised to the Lower Canada minority had been granted them. He concluded by again expressing his regret that the hon. Minister of Finance [Alexander Galt] had been compelled to retire from the Cabinet.

On the motion of Hector-Louis Langevin [Dorchester, Solicitor-General East], the order for the second reading of the Lower Canada education bill was then discharged.

Resolutions on the Currency[7]

On motion of Alexander Galt [Sherbrooke, Minister of Finance], the House went into Committee of supply, Walter Shanly [Grenville South] in the chair.

In reply to George Brown [Oxford South],

Alexander Galt [Sherbrooke, Minister of Finance] explained that the was desired to say by the Government, that it had been resolved that modification should take place upon two points. The first with reference to the currency, and the second with regard to the Debentures. In the matter of the currency it was proposed to limit the issue of $8,000,000. With reference to the other point, the debentures were to be issued for two years instead of three, and at a rate of seven instead of six percent,—

Some Hon. Members—Hear, hear.

Alexander Galt [Sherbrooke, Minister of Finance]—the interest to be payable half yearly. The Government will sell as many of these debentures as possible, up to the amount required, but they would not pay the Banks one per cent commission for negotiating them. The Government would undertake their sale. The Government will only avail themselves of the issue to the extent required but not to exceed the limit he had mentioned of $8,000,000.

Richard Cartwright [Lennox & Addington]—Would the arrangement be made with one Bank?

Alexander Galt [Sherbrooke, Minister of Finance]—The Government would probably make the arrangement with the Bank of Montreal, if not, then with some two other of the largest Banks.

George Brown [Oxford South] expressed is great satisfaction with the modifications which had been announced, but still the discussion would have to go on; he desired to finish his remarks and thought it useless to go on now until the second sitting. He suggested that some other business be taken up until six.

The Committee then rose.

• (p. 81)

Second Sitting.

After routine business. The House again went into Committee on the currency resolutions.

After some conversational discussion with regard to the proposed modifications of the scheme.

John Sandfield Macdonald [Cornwall] argued in favor of a Provincial currency, as more to the interest of the Province, than to be borrowing money from England.

George Brown [Oxford South] contended that the first portion had not yet been made out, the necessity for this particular scheme. The modifications, so far as they went, were satisfactory, but it appeared to him there was still a determination to go on with the establishment of a Bank of Issue. He went over the arguments used on Saturday, arguing that the carrying out of the scheme would bring incalculable ruin upon the country. The system did not provide for the expansion of the currency to meet the requirements of the country, in moving priced to market. Then these notes might at once come back upon the Government, so that it was really equivalent to giving the Bank or Montreal just so many millions of specie.

Alexander Galt [Sherbrooke, Minister of Finance] said the question was not whether the Bank of Montreal was to make a profit, but whether the arrangement proposed was to be to the advantage of the country.—the hon. member for South Oxford [George Brown] had never yet met the calculation which he had submitted, that the country, by entering into this arrangement with the Bank of Montreal, would just save $130,000 per annum, and if the bank found it profitable two them, that ought not to be an objection. He contended that the people of this country had a perfect right to issue their own currency. He would not enter on the question of expansion, because under the limitation to $8,000,000 the question could not be raised. It must be remembered that every dollar missed over the amount held for redemption is a source of profit to the country.

He did not shrink from declaring his conviction that the general interests of the country would be promoted by a sound currency. He held that the currency was the property of the country, and that it would be to the interest of the people that the Government should assume it. He objected to the term Bank of Issue being applied to the proposition before the House. The mere issuing of notes was no necessary part of banking, while the introduction of Provincial circulation on a specie basis, instead of being an encouragement to an issue of greenbacks, such as that which had taken place in the United States, and captivated many of our own people, would be a positive barrier in the way. The hon. gentleman had endeavored to show that the country would have made a loss, had all the banks gone into the scheme, but even supposing that loss had been incurred, it would only be until 1870, when after that time according to his own showing, the country would save 5 per cent upon all the circulation in excess of the specie held for redemption.

Richard Cartwright [Lennox & Addington] admitted that the profits of the circulation ought to belong to the country, but before the government assumed the currency it should remove the restrictions with which banking operations were now surrounded in this country. He said the negotiation of the whole issue of $8,000,000 with the Bank of Montreal would be an act of gross injustice to the Banks of Upper Canada, whose circulation would we curtailed to the extent of $5,000,000, and he thought the arrangement might have been started among all the banks. He believed it was a sound policy to secure the profits of the currency to the country at large, and that the banks would not have much objection to it were they allowed unrestricted use of their capital.

Thomas Gibbs [Ontario South] believed that the proposed limitation of the issue was a mistake. If there was to be a Provincial currency at all, there ought to be equal facilities offered to all the banks, to avail themselves of it. He would prefer to see these resolutions withdrawn, and the money raised on the proposed 7 per cent debentures. He then proceeded to argue that the Government notes would displace those of the banks.

Further discussion ensued,—

The first of the Resolutions proposed in Committee on Friday last, the 3rd instant, at the second sitting of the House, was adopted on a division, and is as followeth:—

1. It shall be lawful for the Governor in Council to authorize the issue of Provincial notes payable on demand, of such denominations as may be determined upon, to an amount not exceeding five millions of dollars, and to re-issue the same. Such notes shall be a legal tender, and shall be redeemable in specie on presentation at Offices to be established at Montreal and Toronto, according as the said notes may be made payable.

The Second to the Eleventh Resolutions, inclusive, were severally adopted on a division, and are as follow:—

2. It shall be lawful for the Governor in Council to enter into arrangements with any or all of the Chartered Banks of this Province, for the surrender of their power to issue notes, on or before the first of January, 1808; and in compensation for such surrender an annual sum not exceeding five per cent. upon the amount of their circulation as established by the monthly return, upon the 30th April last, shall be payable to each Bank so surrendering its power, and redeeming its circulation, until the expiration of its charter. And the Receiver General shall exchange the Provincial Debentures now held by such Banks in accordance with the provisions of their respective charters, for Provincial notes. The Receiver General shall, moreover, pay to such Banks the half of the estimated cost of their unissued notes.

3. It shall be lawful for the Governor in Council, in entering into any such arrangement with any such Bank, to provide either for the immediate or gradual surrender of its power to issue notes, extending, in the latter case, over a period not exceeding twelve months. But in case of such gradual surrender the exchange of Provincial notes or Provincial Debentures, held under its existing Charter, shall be made to such Bank only in equal proportion to the amount of notes actually redeemed, as shown by the monthly returns.

4. From the date of any such agreement with any Bank, it shall not be required to hold any Provincial Debentures as now provided by law.

5. Every Bank, surrendering its power to issue notes, shall make a weekly return of its notes redeemed and of those still outstanding. The compensation above authorized shall be paid half-yearly upon the amount redeemed, computing the same from the average of the weekly returns for the half year, until the amount so redeemed, shall equal 9-10ths of its circulation as at 30th April last, when it shall be entitled to receive compensation upon the full amount.

6. It shall be lawful for the Governor in Council, over and above the five millions hereinbefore authorized, and the amount necessary to redeem the Debentures held by the Banks surrendering their circulation, to cause Provincial notes to be issued to the amount of their notes withdrawn from circulation, and also to make a further issue to any Chartered Bank in this Province, from time to time, upon its requisition and upon payment for the same. Provided that the total amount issued does not exceed eight millions.

7. The sum in specie to be held for the redemption of the Provincial notes, shall be twenty per cent. upon the amount outstanding, so long as the whole amount in circulation does not exceed five millions. For any additional amount of notes in circulation beyond five millions, twenty-five per cent. shall be ‘held in specie; and for any excess over ten millions, but not exceeding fifteen millions, thirty-three and one-third per cent. and for any excess over fifteen millions, fifty per cent. on such excess shall be held in specie. But Provincial Debentures shall be issued against the Provincial notes to the full extent by which the specie held in reserve fails to cover the whole amount of notes in circulation.

8. A return of the whole amount of Provincial notes in circulation, and of the specie held for their redemption, shall be made to the Audit Office, on each alternate Wednesday, which shall be published by the Auditor in the Canada Gazette.

9. It shall be lawful for the Governor General to establish branches for the Receiver General’s Department in Montreal and Toronto, for the issue and redemption of the Provincial notes; or he may make arrangements with any Chartered Bank or Banks for the issue and redemption of the notes, allowing a commission not exceeding one quarter per cent. upon the average circulation of every three months.

10. It shall be lawful for any Bank, which may have surrendered its power to issue than three months’ notice in writing to the Receiver General, and publishing such notice in the Official Gazette. Provided always, that such Bank so resuming its power to issue notes, shall cease, from the expiration of such notice, to receive compensation, and shall be bound to repay to the Receiver General the Provincial notes received by it in exchange for Provincial Debentures. Such Debentures to be again delivered to and held by such Bank as provided in its Charter, before it shall be lawful for such Bank to resume the issue of notes.

11. The proceeds of the said Provincial notes shall form part of the Consolidated Fund of this Province, and the expenses lawfully incurred under the foregoing provisions shall be charged upon and paid out of the said fund.[8]

—and the Committee rose and reported the resolutions as amended by the Government.

The House adjourned at 11:20.

ENDNOTES

[1]      Bell introduced the bill “to extend to the Roman Catholic minority of Upper Canada the like privileges as those extended to the Protestant minority of Lower Canada,” to the Legislative Assembly on Aug. 3, 1866, p. 74 although a cursory discussion happened on Aug. 2, p. 71.

[2]      The “double majority” principle advocated that the Ministry should be supported by two sectional majorities, one for upper and another for lower Canada, in the legislature. J.S. Macdonald believed this principle was not only necessary but already inherent in the sectional nature of the united Canadas. The Macdonald-Sicotte ministry in 1862 in fact practiced the principle. See Bruce W. Hodgins, John Sandfield Macdonald, 1812-1872 (University of Toronto Press, 1971).

[3]      Meaning the Quebec Resolutions. The Resolutions which were agreed to by the Legislative Assembly can be found on Mar. 13, 1865, pp. 1027-1032.

[4]      George-Étienne Cartier, Legislative Assembly (Feb. 22, 1865), p. 411. Quote is not verbatim.

[5]      Union with Scotland Act 1706 (England) & Union with England Act, 1707 (Scotland).

[6]      Union with Ireland Act 1800 (U.K.) & Act of Union (Ireland) 1800 (Ireland).

[7]      This title has been added by the editors of the current edition (2022).

[8]      Journals, pp. 307-308. Inserted for completeness.