Serving Capital


If all the rhetoric about the new Governor General were true it would appear she is bent on destroying the country. Allegedly a separatist at heart, it has been suggested that she is disloyal to Canada and she sees the country as an imperialist oppressor (1,2). Sadly, this is probably not the case, although having been born in the Caribbean one would hardly think it unreasonable for her to be disposed in that way.

While Canada’s relationship with the Caribbean is hardly that of an imperial overlord, it has certainly never been that of an agent of kind benevolence. The most significant aspect of Canada’s relationship to the Caribbean has been its outstanding service to the working interests of British and U.S. capital.

Halifax, Nova Scotia was often known as the “Warden of the North”, the sentinel of the British Empire in the Americas (3,4). This was because as a prime naval installation it helped assure the British control of its Caribbean possessions. As a well fitted central supply depot and shipyard for the British Royal Navy and the British Slave trade, Canada’s east coast ports were unique and invaluable. The cod fishery of Newfoundland was of central importance as a food supply to the British plantation economies of the Caribbean both during and after the abolition of slavery (5).

As the nineteenth century developed the uses of Canada became more than merely a safe port to re-supply the massive imperial fleets of the British Empire. Canada started to develop services to both American and British businesses that were exploiting the wealth of the Caribbean. Canada’s transportation industry, built on the basis of serving the British Empire, now constitutes a significant portion of  our GDP and has been estimated  at over $60 billion, 80% of which is external (6).

How this role developed and expanded into other services to the working interests of capital is a result of Canada’s unique role as a sympathetic colony of Great Britain and Great Britain’s business interests in the United States.  This relationship became important because London’s capitalists had extensive financial control over the U.S. after the revolution and well into the nineteenth century (7). Canada’s weak political nature as a servant to London became essential as it acted as a trusted conduit and malleable obedient connecting third party between the interests of U.S. and British capitalists.  This servile role is clearly demonstrated in the exploitation of the Caribbean.

Although the relationship with the territory of Canada and the Caribbean is a long relationship going back to the first events of the European conquest, the relationship of Canada as a nation starts with its inception and the first prime minister of Canada, Sir John A. MacDonald. While Prime Minister, MacDonald founded an insurance company through an act of parliament and then made himself its managing director. In doing so, Sir John A. MacDonald tied his financial wealth, in part, to the American and British profits drawn from the plantation economies of the Caribbean (8,9,10).

Paul Martin, the outgoing Prime Minister of Canada, owes his family’s wealth to the Caribbean transportation services offered to the interests of British and American capital (Canada Steam Ship Lines) that started in the nineteenth century and continues today (11,12).

As the tide of American invasions swept the Caribbean, Canada’s business elites followed in their wake. The Bank of Nova Scotia went so far as to set its policy for expansion in the Caribbean in step with the invasion and solidification of control by the American military (13). Continuing in this tradition, Canadian businesses could count themselves as part of the invasion. Alternately, American businesses became dependent upon the long experience and the connection to British Capital Canadian services provided (14).

These services can be split into three interrelated areas; finance, transportation and military. All three had one thing in common in that they were developed to facilitate the expropriation of profit from the Caribbean to the absentee owners in the financial centres of London and New York.

The reasons for these connections are partly due to the nature of the laws created immediately after the American Revolution (15,16). Wary of the power of financial institutions, the banks in the U.S. were subject to far more control than those in Canada, a situation that continues today, with Canada’s financial services abroad currently estimated at over $10 billion annually (17,18). Coupled with this, in order to do business in the Caribbean, the U.S. businesses were obliged to trade in British currency, as the British dominated trade throughout the Caribbean (19). Canadian banks and other financial institutions such as insurance companies not only traded in British currency and U.S. dollars but by comparison had far more power to do as they liked than their American counterparts (20).

Added to all of this, they possessed another more significant advantage as well: they were located throughout the Caribbean and throughout the US. The experience helping the British to run their slave plantations and support its Caribbean naval supremacy was a great boost in that Canadian businesses had well developed transportation, supply and financial services throughout the Caribbean. The ethics of supporting and gaining profit from imperialism was not a significant issue either in support of the British or the United States.

The result of Canada’s sympathetic relationship with British and U.S. control in the Caribbean can be seen in two ways. First, Canada developed its trade within the framework of American and British Capital interests, and the countries of the Caribbean were often forced to develop their industry in an environment where Canadian corporations were significantly powerful if not the dominant business interests in certain areas.

Favoured by British and American Capital, Canadian corporations would often dominate the sectors where they were involved. In Cuba, Canadian banking interests operated with the power of a central Bank (21).

As power has shifted from Britain to the U.S., Canadian services have also shifted from one client to another. Today, Canadian banks can be found throughout the Caribbean and Canadian businesses are deeply synchronized and intertwined with U.S. capital interests in the Caribbean. As Haiti received its first branch of the Royal Bank of Canada in 1917 after the U.S. invasion of the island, so today one can find Canadian transportation and financial services throughout the Caribbean serving the interests of capital.

The interests of the powerful elites of Britain, the U.S., and even their subordinates in the Caribbean, is based upon the low rate of pay in the Caribbean (22, 23). Their ability to continue their operations and rates of profit is contingent upon mitigating control of labour regulations, trade unions and the power generally of Caribbean people to affect political and economic control of their society. The owners of capital and their servants owe their ability to perpetuate this situation by the use of force. It is in this capacity that Canada has been as dutiful a servant as it has been in other capacities.            

The Canadian military was an integrated arm of the British Empire and used throughout the Caribbean. Its role in the interests of U.S. capital has been no less integrated. When the U.S. was dissatisfied with the Haitian government in the early 90s it was a Calgarian, Lynn Garrison, with admitted connections to the CIA, who became known as a major strategist behind the coup (24, 25). Later, in 2004, it was Canadian troops who facilitated the U.S. expulsion of the democratically elected president, Jean-Bertrand Aristide (26).

Throughout the Caribbean, the influence of military force has played a decisive role in shaping political and economic structures that perpetuate the worst poverty in the hemisphere and some of the most brutal human rights crimes in the world.  Canada, throughout its history, has been involved in the use of military force throughout the Caribbean (27, 28).

Often, in situations where some degree of political and economic control is exercised by the peoples of the Caribbean, Canadian businesses have been subject to the criticism that they are both exploitative and destructive. In present day Cuba, there is at least some hint of what a progressive relationship Canada could have with the Caribbean. Approximately 900 million dollars of trade exist between Canada and Cuba annually (29). The two societies have contributed to each other’s development and exchanges of science and the arts have been beneficial for both countries (30).

It is true, of course, that those Canadian businesses presently form a conduit through which the interests of U.S. capital can and do operate in Cuba. Our relationship, however, is tempered by the larger degree of political and economic control that this Caribbean society has as compared to others. In the Cuban revolution there is at least some hope that Canada’s relationship with the Caribbean will not always be that of mere servants of capital and that Canada will not be seen as the oppressors’ friend by the peoples of the Caribbean.

For more on Canada’s history in the Caribbean, check out Canada’s Shame, Empires Profit: The Caribbean Slave Wars 1788-1807, also by David Evans.

 

Notes

(1) Angry vets plan Gov. Gen. protest; Calgary Herald   11-08-2005. “In a documentary by her husband in the 1990s, Jean was shown in a bar toasting independence, in the company of several hard-line Quebec separatists.”

(2) Governor General: LOYAL ENOUGH?: The Liberals’ enemies cast doubts on the new appointee’s federalist credentials; Maclean’s   08-22-2005. “HE SURE looks the part. With his long, grey hair and laid-back attire, Jean-Daniel Lafond is the very image of the aging seventies-vintage Montreal separatist. And that’s how enemies of the federal Liberals would like to label the husband of governor general-designate Michaëlle Jean.”

(3) Halifax; Canadian Encyclopedia (2002)  

(4) http://en.wikipedia.org/wiki/History_of_Halifax , History of Halifax. “Halifax’s fortunes waxed and waned with the military needs of the Empire…” Also noted, “…it had quickly become the largest Royal Navy base on the Atlantic coast and had hosted large numbers of British army regulars…” Halifax helped with the Empire’s allies as well, “…the port played a minor role during the American Civil War, offering refuge and supplies to Confederate naval vessels.”

(5) Bury the Chains: Prophets and Rebels in the Fight to Free an Empire’s Slaves, Adam Hochschild, Hought Mifflin Company, 2005

(6) Manufacturing, Construction and Energy Division: Transportation equipment industries HIGHLIGHTS 1995, http://www.statcan.ca/english/freepub/42-251-XIE/1997/42-251.htm, Statistics Canada

(7) Second Bank of the United States, http://www.u-s-history.com/pages/h256.html , 2005.  This work details the struggle by the first U.S. legislators to establish a bank that could be subject to domestic political control. 

(8) Manufacturers Life Insurance Co., Toronto, And all the past is future, 1962

(9) James, Fleming, Merchants of Fear – An Investigation of Canada’s Insurance Industry, 1986

(10) Manulife Financial Corporation, TCE Standard, 2005.

(11) CSL loves the Bahamas; Montreal Gazette   12-02-2005. “If he’s such a great patriot, how come ships owned by his family business, Canada Steamship Lines, are registered in the Caribbean and elsewhere to avoid paying Canadian taxes?”

(12) Canada Steamship Lines, Inc, Canadian Encyclopedia (2002)  

(13) Business History Review, Winter 1989 v63 n4 p.797(42), The Bank of Nova Scotia in the Caribbean, 1889-1940. “They (Canadian Banks) concentrated their branches within the Caribbean because of the growth of U.S. involvement in this region after the Spanish-American War. Establishing branches in the Caribbean placed the expansion of their business under the umbrella of U.S. imperialism, which implied rapid growth in the trade and commerce of the region and the political and military control necessary for stability.”

(14) Ibid. “Before the First World War, when U.S. banks were unable and British banks were unwilling to emulate them, the Canadian chartered banks pioneered both the amalgamation of international branch banking with domestic operations and the finance of international trade between the Caribbean and the United States via the negotiation of bills of exchange drawn in New York. Moreover, because they undertook all of these activities within a single banking network, they gained a competitive edge over potential rivals, minimizing the use of correspondent banks by internalizing the process of negotiating international bills and foreign currency transfers within their own branch network.”

(15) Remarks by Chairman Alan Greenspan at the Annual Dinner and Francis Boyer Lecture of The American Enterprise Institute for Public Policy Research, Washington, D.C., December 5, 1996. http://www.federalreserve.gov/boarddocs/speeches/1996/19961205.htm . “Equally controversial was the chartering of the First Bank of the United States, which, although it had few functions of a modern central bank, was nonetheless believed to be a significant threat to states rights and the Constitution itself.”

(16) Money in North American History, From Wampum to Electronic Funds Transfer, http://www.ex.ac.uk/~RDavies/arian/northamerica.html , 25 May 2005. “After the revolution one might have expected the newly independent Americans to have welcomed with enthusiasm their freedom to set up banks but in fact there was a great deal of opposition to banking in general.”

(17) Financial Services Marketing, Sept-Oct 2001 v3 i6 p16. Gathering global assets: Don’t Blame Canada. Reticence in the U.S. Limits Cross-Border Growth. This article details the  “greater flexibility to diversify and form alliances”  as well  as other advantages Canadian banks have over their U.S. counterparts.

(18) Serving up sales; Canadian Business, 03-26-1999.

(19) Business History Review, Winter 1989 v63 n4 p.797(42), The Bank of Nova Scotia in the Caribbean, 1889-1940.

(20) The Journal of Economic History, Sept 1997 v57 n3 p674(23), Profit differentials between Canadian and U.S. commercial banks: the role of regulation.  “An intercountry comparison reveals that the less restrictive regulatory environment in Canada has historically resulted in higher bank profits”.

(21) Business History Review, Winter 1989 v63 n4 p.797(42), The Bank of Nova Scotia in the Caribbean, 1889-1940.

(22) Made in the USA? Not Anymore; New York Times Upfront   04-26-2004

(23) WWD, Feb 21, 1995 v169 n34 p33(1), Caribbean low-cost labor is a potent lure.

(24) HAITI: WITH FRIENDS LIKE THESE A host of shadowy figures is helping Haiti’s military rulers hatch a plot to sideline Aristide permanently;, Time   11-08-1993. “His sympathizers in Miami claim Garrison is the CIA’s designated handler for Cedras. Garrison says he is not CIA, but he claims to have longstanding contacts within both the Central and Defense Intelligence Agencies.”

(25) Giving “the devil” his due; Atlantic Monthly, 06-01-2001.

(26) Preventing Democracy in Haiti: Turning the Light Off at the End of the Tunnel; Hamel, Paul. Peace Magazine, 01-01-2005.

(27) Dominica: Chapter 2B. Economy; Countries of the World   01-01-1991. “The (coup) plot involved Patrick John, the Defence Force, elements of the Ku Klux Klan, neo-Nazi groups, United States and Canadian mercenaries, and underworld figures from the United States.”

(28) Caribbean Commonwealth: Chapter 1C. The Regional Security Setting; Countries of the World   01-01-1991.  Canadian military support has been utilized under direction of British and U.S. governments. 

(29) Embassy, June 15th, 2005, Cuba Trade: ‘Don’t Ask, Don’t Tell’. Canada is Cuba’s third largest trading partner.

(30) A Latin love-in. Maclean’s, 01-15-1996

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