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DAOUST, CHARLES – Volume IX (1861-1870)

d. 27 Feb. 1868 at Montreal


Responsible Government

Sir John A. Macdonald

From the Red River Settlement to Manitoba (1812–70)

Sir Wilfrid Laurier

Sir George-Étienne Cartier


The Fenians

Women in the DCB/DBC

The Charlottetown and Quebec Conferences of 1864

Introductory Essays of the DCB/DBC

The Acadians

For Educators

The War of 1812 

Canada’s Wartime Prime Ministers

The First World War

Consolidating Confederation: Cartier and the Canadian Economy
Original title:  The Henry Morgan  & Co. Department Store, 1870

Source: Link


The public career of George-Étienne CARTIER lies at the heart of the industrialization of the Canadian economy in the 19th century. The following excerpt from the biography of John YOUNG, businessman, entrepreneur, and politician, summarizes the economic issues in which Cartier took an interest as well as the typical activities and concerns of the Montreal business class at that time:

“John Young was one of the best-known public figures in Montreal in the mid-19th century. He shared the assumption of his fellow merchants that the St Lawrence was potentially the most advantageous commercial outlet from the west, and their aspiration that Montreal thrive on this trade, but he had different views as to how the goal could best be achieved. He championed free trade and the Caughnawaga canal with the persistence and fervour of an evangelist. In his later years he supported the commercial annexation he had so strongly opposed in 1849.

“Despite the attacks and ridicule lavished upon him by his fellow businessmen, who feared his projects and his pen, Young was in many ways representative of his class, place, and time. He was a businessman in the export-import trade, an entrepreneur in a number of railway and telegraph ventures, a land speculator, and a dabbler in other ventures. Businessmen of this type assumed that the prime role of the state was to improve the climate of enterprise by building the necessary facilities, providing assistance for others, and following the ‘right’ policies.”


The economic climate was also characterized by the emergence of a French Canadian business class. Among Quebec’s prominent francophone businessmen in the period after confederation was Guillaume BOIVIN, a Montreal shoe manufacturer:

“Boivin seems to have begun his career in Montreal in a rather modest way. In 1871 he had a medium-sized business with 45 employees, a fixed capital investment of $13,000, and steam-engines generating three horsepower. In annual output per worker, however, he ranked among the few top manufacturers, a probable indication of his technical knowledge. … Boivin was interested in all aspects of production and was constantly seeking to innovate. Over the years he would be granted patents for some of his inventions. He earned an enviable reputation among Montreal footwear producers and was one of the major French Canadian manufacturers in the city. Set-backs connected with the economic crisis of the 1870s drove him into bankruptcy about 1881, but he again built a prosperous enterprise that around 1890 had 150 to 200 employees and annual sales of some $200,000.”


Several French Canadian businessmen found it difficult to compete with other Canadian capitalists, who had greater financial resources at their disposal. Victor HUDON was among them:

“Prominent as a merchant, banker, and industrialist whose factories hired hundreds of workers, Victor Hudon was a celebrated member of Quebec’s regional bourgeoisie. Yet although he was a businessman whose affairs were far from negligible, he was not in the same league as such powerful members of Canada’s national bourgeoisie as fellow Montrealers George Stephen* or Donald Alexander Smith*. By the last decades of the 19th century control over the Canadian economy was falling into fewer and fewer hands and capitalists such as Hudon were being pushed aside by those with greater resources. Hudon’s experience was similar to that of other members of the regional bourgeoisie, many of whom were francophones, and his career illustrates the marginal role of the French-speaking bourgeoisie in the Quebec economy by the turn of the 20th century.”


To a large degree, Canada’s economic development depended on the extension of the railway, in which Cartier took a particular interest. His first public speech on the subject was given in 1849. Two decades later, he still saw the railway as the sine qua non for territorial expansion:

“It is also to Cartier that we owe in large part the entry of British Columbia into the Canadian confederation. During the spring of 1871, in the absence of John A. Macdonald, who was sick, he obtained the Canadian parliament’s approval for the address seeking the establishment of a sixth Canadian province, in return for the promise that it would be linked with the rest of Canada by a railway through the Rockies. ‘Before very long,’ Cartier exclaimed prophetically, ‘the English traveller who lands at Halifax will be able within five or six days to cover half a continent inhabited by British subjects.’ This became possible in 1885. … In the spring of 1872, Cartier introduced a bill in the House of Commons that provided for the building of the Canadian Pacific Railway (35 Vict., c.71). It was at the time of the adoption of this bill that Cartier gave the exultant cry: ‘All aboard for the West!’”


As the biographers of Sir John A. MACDONALD, prime minister of Canada, explain, powerful private interests were enmeshed in the development of the railway to the Pacific, and Cartier found himself in the midst of a clear conflict of interest:

“At least three, possibly four, groups in Canada were interested in the Pacific railway by 1872, to say nothing of Americans. The main groups were those of Sir Hugh Allan of Montreal and David Lewis Macpherson of Toronto. Cartier had conceded in 1871, under opposition pressure and while Macdonald was ill, that the railway would not be built as a government enterprise but by a private company. Macdonald tried to bring the main groups together before, during, and after the election, but jealousies between Toronto and Montreal and mutual suspicions between principals made that impossible. In the late autumn of 1872 Allan was given the task of putting a company together to build the railway. Macdonald had made only one promise to Allan: the presidency of an amalgamated Canadian Pacific Railway Company, whenever it was formed. But there were commitments of which, as yet, Macdonald knew nothing, notably Cartier’s to Allan in the summer of 1872, that Allan’s group would be guaranteed the charter and a majority of stock in return for additional election funding, totalling more than $350,000. When Allan finally told Macdonald the amount, it seemed so fantastic that he did not believe Allan, and that fall he wrote to Cartier to confirm it. Cartier did, more or less; he was then in London fighting Bright’s disease, which eventually would kill him, in May 1873.”


The following excerpt from the biography of Sir Hugh ALLAN, business magnate and railroad promoter, reveals, from another angle, Cartier’s involvement in the Pacific railway project:

“A lifelong Conservative, [Allan] directed some $400,000 to the [Liberal-Conservative] party’s federal campaign in 1872 while pursuing the Pacific contract; his lawyer noted that Conservative policies were so favourable to Allan’s interests that a contribution three times as large would have been justified.…

“Allan also took the direct approach in dealing with Quebec politicians such as Hector-Louis Langevin* and Cartier. He subsidized their campaigns, arranged for them to rub shoulders with the British élite, named their friends as company lawyers, and advertised in their newspapers. In return he received charters, favourable legislation, and the repeal of laws he disliked. His interference was blunt and the results usually swift.”


Here is what Cartier’s biographer wrote about this episode of his career:

“In the inquiry that ensued, it was proved that Cartier had written to Allan, promising to allow him to build and run the railway, and that he had asked Allan in other letters for sums of money, which were in fact paid: Cartier himself had received $85,000. Such practices were part of the political customs of the day, but this time they were somewhat less than prudent. They are explicable in Cartier’s case only by the habit of power, the belief that the good of the party was identified with that of the country, and perhaps also by the beginning of an illness to which he was to succumb at the moment when what has been called the ‘Pacific Scandal’ burst.”


To learn more about Canadian economic life in Cartier’s time, please consult the following lists of biographies: 

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