Exactly half a century ago, a government led by a Trudeau was embroiled in a trade conflict with the United States and worrying about inflation and other economic issues on the horizon.
Inflation and economic disruption persists, an ongoing trade spat with the United States continues to threaten the economy and a Prime Minister Trudeau leads the country less than a year away from what would turn out to be a near-disastrous election.
The year is 1971 and the cause of the economic crisis is different than it is today, just as is the U.S. president.
Fifty years ago today, the House of Commons was in the middle of one of its shortest winter breaks ever, disbanding on Dec. 23 and returning on Dec. 28.
The length of the holiday break was a subject of great “anguish” for MPs, “who have to go long distances home to celebrate Christmas with their families and constituents and then come back here on Monday,” according to Ged Baldwin, then House leader for the opposition Progressive Conservatives.
And when the House did reconvene after the festivities, the world was very much changed, at least for prime minister Pierre Elliott Trudeau; he was congratulated on the birth of his first child, Justin Trudeau.
NDP House Leader Stanley Knowles noted it was the first time the Commons sat to congratulate a PM on the birth of their child; and the House did so with its own nerdy style of humour that’s still recognizable 50 years later.
“I am entitled, on a parliamentary issue, to say to the prime minister that he will have joy and happiness. There will be problems, of course, but it will be useless in the debates that may take place from time to time to employ 75C. It just will not work,” said Baldwin.
In 1971, standing order 75C was the recently implemented rule for time allocation, a means by which the government can limit debate and speed along legislation. It’s still controversial to this day, as standing order 78(3).
Trudeau replied that he hoped to use another rule, one which would have required multi-party consent, before saying what is almost certainly the first pun on our current prime minister’s name: “But one way or another, the baby has arrived ‘just-in’ time to have agreement.”
“This is one case where I would be able to tell [Justin] that I have had advice from people of all parties who have had some experience in the rearing of children and that there will be a multi-party approach to this,” Pierre Trudeau joked.
It was a incredibly important moment for Trudeau, according to his biographer John English.
“[1971] was a terrible year for Trudeau,” aside from his marriage and the birth of his son, English said.
An attempt at constitutional reform had failed, he was falling in the polls and economic concerns were running high.
Despite this, 1971 was life-changing.
“The birth of his son was what he wanted more than anything else,” English said.
Trade ‘irritants’ with U.S. dominated debate
The birth of the current prime minister, at a time when his father was at the helm, was not the only parallel between today’s politics and those of a half-century ago.
Tax reform is another one; the bill the government was looking to pass ahead of Christmas introduced the first tax on capital gains. Today, the Liberals continue to discuss more progressive taxation, though they’ve rejected calls to increase capital gains taxes.
But perhaps the most striking similarity is the preoccupation of federal politicians with an ongoing trade spat with the United States, who in the “Nixon Shock” of earlier that year saw the U.S. untether its dollar from the gold standard, slap import surcharges on other countries (including Canada) and make moves to cancel the Autopact.
Between the Autopact and Nixon’s tax credit for investments in American-made machinery, the protectionist echoes of that time can be heard today in the electric vehicle tax credit proposed by U.S. President Joe Biden.
The Nixon Shock was an incredible blow to Canada that set off a flurry of negotiations that were challenged by the absence of good feelings between Trudeau and Nixon.
“He was wearing long hair at the time, which of course, immediately puts you in trouble with the Republicans,” English said.
Trudeau’s trip to the U.S.’s arch-enemy, the Soviet Union, earlier in the year, during which he asserted an independent foreign policy and tightened bilateral diplomatic ties, had not helped in building bridges with Nixon, said Robert Bothwell, a Canadian historian and professor at the University of Toronto.
The bad blood between the two leaders continued even though “Nixon really admired what Trudeau had done in the October Crisis” of 1970, Bothwell said.
Just before a meeting during Trudeau’s visit to Washington in December 1971, Nixon called Trudeau a “pompous egghead” and a “son-of-a-bitch,” in recordings made in the Oval Office that were released by the Nixon Library in 2008.
But the US.-Canada trade issue was more inflamed than perhaps deserved, Bothwell said.
“The Americans were doing things that they didn’t really particularly understand, I don’t think Nixon did. And I don’t think the Canadians did either,” he said.
Eventually the trade spat “petered out,” Bothwell said. Trudeau went to to Washington earlier in December and an international settlement was reached on some issues, including the import surcharge. The Autopact survived as well, a supremely important win at a time, Bothwell said, the Canadian auto industry was going “gangbusters” and pulling the wider economy along with it.
English said he saw parallels between the way both Trudeaus handled conflict with the United States, the Nixon Shock and Trump’s renegotiation of NAFTA.
“I think both father and son recognize [the need] to try and keep the flame low, try to minimize it and try to turn the cheek as much as you can. Because you can’t turn it totally, because if you do it would be political suicide in Canada. You can’t be seen to be weak vis-a-vis the United States,” he said.
Inflation on the horizon
Then, just as now, a key concern of the conservative opposition was the cost of living. Several questions in the House were dedicated to rising inflation when it returned Dec. 28,1971. The inflation rate was just under five per cent, near the start of a major inflationary period in Canada. Canada’s inflation rate in November, 2021 was 4.7 per cent.
Asked in the House about a warning from the OECD that inflation could increase in 1972, Pierre Trudeau was sanguine.
“Well, Mr. Speaker, we are taking these warnings seriously, and all the more so in that we ourselves are aware of that ever present danger of a recurrent inflationary push … If anything has to be announced we will announce it in the usual manner,” he replied.
The economic malaise at the time was becoming more widespread. There was also a related issue of the entrance of baby boomers into the labour market, Bothwell said. That generation had helped install the elder Trudeau in office, but became a major challenge for his economic policy, as the government grappled with how to help millions of young Canadians find jobs.
During a period of stronger Canadian nationalism and anti-Americanism, Canada was looking abroad for new partners, including in Asia. Now 50 years later, many of those same diversification urgings persist, such as the renewed push for a free trade deal with India.
The more things change
There are many differences, of course, between then and now: the Soviet Union dominated the international stage, while today it does not exist.; Pierre Trudeau had, the previous year, re-established relations with China while now relations between the two countries are in tatters and economic issues were driven by factors that were more mundane than a global pandemic.
By 1971, Bothwell said, economists were just beginning to think that the economic system which had dominated since the Second World War might not be working properly anymore. And the Liberals, who had long dominated Canadian politics, were headed toward near-defeat in the 1972 election.
Despite those difference, the transcripts of debates in the House of Commons from 50 years ago sound remarkably similar to those Canadians can watch today. And there’s one undeniable parallel, according to John English.
“So much is different, but Canada is still a country and we still have a Trudeau as prime minister.”