No. 955
Memorandum by the Assistant Secretary of State for European Affairs (Perkins) to the Secretary of State1

  • Subject: Material on Canada


To take full advantage of your visit to Canada November 21–23 to bring Canadian attitudes, policies and actions into conformity or harmony with those of the United States, and to dispel or mollify Canadian apprehensions regarding United States action on matters of common interest.



General Attitudes

It is recommended that, to the extent that the nature of your visit permits, you take every opportunity that presents itself to indicate to Canadian Cabinet Ministers our conviction that there is no cause for complacency. It could be observed that fundamentally there is no lessened danger of aggression by the Soviets than existed in the tense days of the Berlin blockade and the onset of the aggression in Korea. (Your speech2 has been designed for the same purpose.)

You could add that every NATO partner has got to see how it can best contribute to collective security, especially at this time when the organization is threatened by the strains experienced by Britain and France. The present moment is an opportunity for Canada to provide an inspiring example in NATO, thus contributing to a confident attitude at the next meeting.

Based on past experience that direct U. S. approaches on these matters can do more harm than good, it is recommended that you not raise the Canada–NATO issue frontally but, by private conversations with Cabinet Ministers, build up a favorable climate for a NATO approach.


Bilateral Defense Matters

If opportunity presents itself, you could express hope that the execution of our joint responsibility to defend the North American continent can be carried forward without bickering and in an atmosphere of mutual confidence. You could note that there seems to [Page 2052] be evidence of defects on both sides when recent problems are examined—unilateral planning on one side, and hypersensitivity regarding political repercussions on the other; but that we cannot allow the joint defense job to become bogged down by such considerations. You could add that the United States has no desire to put one more soldier on Canadian soil than is necessary to discharge the job at hand, taking into account the portion of the total defense task which Canada is presently in position to handle. You could assure them as to Canadian sovereignty—we completely respect it.


St. Lawrence Project

If the Seaway and Power Project is raised by the Canadians, you might express gratification that the two countries seem on their way, finally, toward making use of a great natural resource. The understanding and cooperative attitude of the President could be noted, and also—on the point of the authority of the FPC to name the power entity—Mr. Truman’s remark to you on the telephone that “God, Himself, couldn’t move the FPC.” It would be well to mention that by the terms of the Federal Power Act, a licensee of the FPC is not granted immunity from litigation by opponents and we would be unwise not to expect litigation, perhaps of long duration.


Hoof and Mouth Embargo

Only if this subject is raised by the Canadians should you express confidence that the U.S. Department of Agriculture will not maintain the embargo any longer than necessary; that you believe the Canadian livestock industry concurs in the need to control hoof and mouth disease and that the embargo is not a protectionist device. You might express optimism, in a nebulous way, about resumption of our meat imports from Canada but not be specific in this matter, and certainly not with Minister of Agriculture Gardiner, whose speeches have done more harm than good.


General. A few salient points regarding present Canadian attitudes are provided at Tab A. It is clear that Canadians are becoming increasingly complacent, introspective and engrossed with internal politics. To the extent that Canadian interests on the international scene are or could be endangered, there is a concomitant endangering United States interests.

Bilateral Joint Defense Matters. A résumé of difficulties encountered with the Canadians in getting approval of either U.S. or US–Canadian joint defense projects in Canada is given at Tab B, a memorandum to Deputy Undersecretary Matthews.3 The Permanent [Page 2053] Joint Board on Defense, Canada and the U.S. is encountering heavy going and while the fault is not all the Canadians’, they certainly share the blame.

St. Lawrence Project. You will recall the exchange of letters between Prime Minister St. Laurent and President Truman in which the Canadians outlined reasons why they considered the 1941 Seaway Agreement as superseded. The most recent developments and the present position of the project is outlined at Tab C.4 The Canadian Government fears that the St. Lawrence will be an important issue in the next election unless steady progress is shown in bringing it to fruition. The Government has pressed the Department to have the entity named on the U.S. side to construct the power works, presumably the New York State Power Authority, and seems unable to understand that this is beyond the power of the Administration since the U.S. entity will be that authorized by permit of the Federal Power Commission or—theoretically—authorized by Congressional action. It is probable that the Canadians do not appreciate the extent to which any non-federal entity undertaking construction would be exposed to litigation on the part of interests opposed to the project.

Hoof and Mouth Embargo. The greatest caution is required regarding the fact that the Department of Agriculture is taking positive steps to lift the embargo imposed last February 25 when hoof and mouth disease was confirmed. Premature leakage regarding the steps contemplated by the Department of Agriculture could upset these plans. The embargo stopped meat and livestock exports to the U.S. worth $100–135 million per annum. By internal adjustments and price support, plus a triangular deal involving the U.K. and New Zealand, it has been possible to avoid serious difficulty but reopening the U.S. border would be welcomed economically. The matter is of political significance and especially so to Minister of Agriculture Gardiner, who has been personally criticised for his part in coping with the initial outbreak of the disease in Canada.

[Page 2054]

Tab A

Memorandum by the Officer in Charge of Commonwealth Affairs (Peterson)5

Canadian Attitudes

International Affairs
The Canadians are almost always with us on the major issues in NATO and in the UN (notable recent exception: Korea), in GATT, and multilateral trade matters, and in bilateral defense and economic collaboration. While they understand in theory the nature of the Soviet threat (and know what militant communism would do to their social and economic system, which remains based on private enterprise with only modest socialistic adjustments of a welfare nature), they seem to feel no immediate threat to Canadian national interests.
They are enjoying a boom as their country is developed and industrialized, which is a cause for pride. They are looking inward, very much as this country did in the ’20’s, with little real interest in international affairs.
Where the Canadians diverge from us, or oppose us, is chiefly in matters of execution, method and timing. The sense of urgency prevalent in Washington is not matched in Ottawa nor generally in Canada.
A feeling persists that the United States is awkward and hasty in its role of leadership in the Free World, inclined to be “trigger happy” and lavish in its provision of defense facilities and forces, reluctant to take time necessary to plan carefully and thus to economize.
The feeling of peril following the attack on Korea has practically disappeared in Canada. There is no urgency about preparations for any direct attack from Russia. Inevitable delays and frustrations in carrying out their defense program are being accepted with equanimity. The Canadians prefer to keep hemispheric defense in the planning stage rather than follow our lead in actually placing forces and facilities in position.
Canada, despite the buoyancy of its economy, does not feel that it can match the U.S. in the liberal or continuing provision of unrequited exports to NATO countries or other destinations calculated to support the free world. The Canadians, who pride themselves as frugal and pragmatic, want and feel they require payment for their staple exports and it is upon this firmly-held conviction [Page 2055] that NATO and U.S. hopes for Canadian economic aid to Europe have floundered. It is believed that the Cabinet will maintain its adamant position in the matter of economic aid.
The pressure of food surpluses, as consequence of excellent grain crops and the hoof and mouth embargo in the United States is not excessive and the agricultural community is a decreasingly important segment of the electorate and hense unable to force the government to finance food exports. Canada’s share in the Colombo Plan is $25 million and Finance Minister Abbott last August stated his flat opposition to any increase.
Canada has consistently refused to accept enlarged force commitments in NATO or speed up deployment. They did accept at Lisbon6 an additional $100 million of Mutual Aid support, but this was used chiefly to finance transfers of existing arms, built to British specifications, which are now non-standard in Canada and have been extensively shipped overseas for forces of other NATO countries.
Conversely, Canada could be attracted to a program of increased free transfer of military end items to NATO because this would satisfy a desire to contribute to mutual security without weakening Canada’s economic underpinnings and concurrently would support the industrialization of the country and maintain its defense production base.
The NATO examining group at Paris is convinced of Canadian economic capability to provide increased support to NATO.
Canada is not likely to catch up to the average NATO country’s mobilization in relation to population because conscription is one of the most serious, deep-rooted political issues between French and English Canada and in any event, the Canadians argue that their ratio of manpower to resources makes it advisable to use its resources and that the use of Canadian manpower in forces represents a waste.
Three statements made October 23 by Arnold Heeney, Permanent Representative of Canada to NAC, in the examination of the Canadian response to the NATO Annual Review questionnaire are significant:
“The Government of Canada is not yet in position to give any firm figure for the expenditure it expects to make in the fiscal year 1953–1954” (e.g., no comment on defense outlays contemplated after March 13, 1953, despite NATO’s urgent need to plan at least 12 months ahead).
“On the other hand, there is no disposition to reduce the Canadian force commitments.” (Canada’s record is good in fulfilling [Page 2056] its original MC 26/17 commitment but she has refused to take on more: e.g., does not consider any part of the unallocated aircraft deficiency calculated at Lisbon as a Canadian obligation.)
“In general it may be said that while the Canadian Government will take the necessary action to complete and finance its declared physical programme, it appears unlikely that the Canadian financial appropriation will exceed that for the current year.”
Political considerations outweigh and over-ride economic considerations in formulating the Government’s attitude toward defense projects, whether bilateral or multilateral. The Federal Government, in power over 17 years, is apprehensive about the coming election in view of the landslide in favor of the “outs” in the United States and in view of Liberal Party defeats on local issues, notably in the Provincial elections of New Brunswick. Taxation, prices which are irritatingly high, and the continued impediment to dollar exports and consequent dislocation of foreign trade are basic election issues. Public criticisms of waste and inefficiency in Government operations and expenditures have been chiefly directed at the defense program. A continued budgetary surplus is criticised as inflationary by the Opposition. It is believed that during this Canadian election period the Prime Minister will weigh his every action in terms of the effect upon the chances of the Liberal Party in the election. This, in absence of some international development which would result in a return of the mid-1950 feeling of urgency, probably as a practical matter precludes any possibility of an expanded Canadian defense effort or more Canadian troops for Korea.
The NATO Central Organization seems not to have made a serious effort to bring Canadian productive capacity into its planning to the same extent that it has with European countries. Canada has some reason to feel she is outside the NATO European circle. Some U.S. recommendations designed to correct this are now under consideration in SRE [S/AE?].
Bilateral Affairs
The Canadians examine with care and deliberation every request put forward by the United States regarding new or additional defense facilities. They are anxious to protect their sovereignty and are wary of long-term arrangements and fixed tenures. They consider Newfoundland compromised its sovereignty in the 99-year leases, which was a bitter pill to swallow when Newfoundland became a Canadian Province.
There exists a decided antipathy in Ottawa toward the stationing of additional U.S. military forces in Canada during peace time, especially when they are posted in populous areas. (The Torbay base area at St. John’s, Newfoundland, is a case in point.) The attempt to cover up the fact that U.S. forces are in Canada has at times involved ludicrous limitations, e.g., requests regarding the location of office space and the wearing of civilian attire rather than uniforms.
U.S. military forces have been circumspect and correct in Canada, are welcomed locally—especially in Newfoundland where there is an appreciable degree of support to the economy as result of defense expenditures.
Canadians are sensitive to bilateral pressures from the United States and resent and will reject dictation. Canadians have scant sympathy for problems with Congress and requests for Canadian action to ease Congressional problems carry little weight. There is justification, however, in the U.S. pointing out that through Marshall Plan purchases and off-shore procurement we have materially supported the Canadian economy and it is only equitable that Canada should aid the U.K. in any crisis; and that their hard-headed business attitude must give way when national security is jeopardized.
While there no longer exists much fear that enlarged North-South economic interchange is a forerunner of political domination (which was the issue in the Reciprocity question in 1911), there is a latent uneasiness about the extent to which U.S. capital is joining in the recent development of Canada. The idea seems to be that Wall Street is muscling in on the Canadians’ birthright and they will be left as “hewers of wood”. There is, for example, some criticism of the St. Lawrence Waterway as permitting Labrador iron ore to move to the States. “Why not use it here?” is a common attitude, especially among those moderately educated in economics but whose opinions, as entrepreneurs and managers, are held in respect by the rank and file.
  1. Drafted by Avery Peterson.
  2. Reference is to remarks made before the Canadian Club at Ottawa on Nov. 21. For the text, see Department of State Bulletin, Dec. 1, 1952, p. 847.
  3. See the memorandum by Perkins dated Nov. 14, supra.
  4. Reference is to a memorandum by Perkins to the Secretary of State, Nov. 1, not printed.
  5. Peterson was also the Department of State member of the U.S. Section, Permanent Joint Board on Defense, United States–Canada.
  6. Reference is to the Ninth Session of the North Atlantic Council at Lisbon, Feb. 20–25, 1952; for documentation, see vol. v, Part 1, pp. 107 ff.
  7. NATO Military Committee document, not found in Department of State or NATO Sub-Registry files.