The Stagnant 70s

Stagflation. Separation. Americanization. It was a tough time for Canada

By at least one yardstick — the growth of personal income — it is possible to see the 1970s as a prosperous time in Canada. By almost any other measure, the country was lucky to get out of the sickly '70s more or less intact.

The prosperity case is made by historians Jack Granatstein and Robert Bothwell in their 2000 book Our Century: “Canadians in the 1970s were better off than they ever had been before — matching Americans in terms of average incomes for the only time in Canadian history.” Sadly, however, inflation played counteractive havoc with their cited 55% growth of average incomes through the 10 years to 1975.

Stagflation — stagnation of national economic activity along with inflation of costs and prices — stalked the country much of that time. In 1975, the year that a federal Anti-Inflation Board set up shop, the economy receded, with unemployment rising to almost 7% of the labor force.

Adding to the pressures on workaday Canada were the ripping of the social and political fabric. There are echoes to this day of the decade's divisive regionalism, the mean-minded kind that cramps commerce as it soils politics and turns social discourse sour. Take the example from the familiar dustup this past spring when the premiers of Alberta and Ontario butted into Ottawa's exclusive right to conduct foreign relations by formally informing the Americans that they objected to Canada's stand against the invasion of Iraq. Their federal counterpart fired back. So Albertans discussed building a constitutional “firewall' against the feds. It all sounded like the same old, same old.

Except that the regionalism of the 1970s seemed more menacing to the country's survival. The decade was barely beginning when the Quebec brand of political parochialism turned truly dangerous. There had been a spell of terrorist bombings by Quebec separatists in Montreal, targets ranging from mailboxes to the stock exchange. Next came the October Crisis of 1970 — the kidnapping of British trade commissioner James Cross and the murder of Quebec labor and immigration minister Pierre Laporte, which prompted Ottawa to suspend civil rights and call out the army.

Next came the “oil shocks” of 1973 and 1979, when world prices exploded — by more than tenfold by the end of the decade. Alberta sought to cash in with more exports, and Ottawa tried to insulate Canadians from the inflated fuel costs. Apart from driving motorists out of gas guzzlers into compact cars and a federal program subsidizing the increased insulation of homes, the result was a lasting bitterness between Alberta and the rest of the country.

The price shocks killed the National Oil Policy, under which consumers west of the Ottawa River formed a captive market and paid premium prices to Alberta producers. They also led to the Trudeau government's National Energy Program, designed to prevent higher-priced US markets from siphoning off everything Alberta could pump out and to insulate Canada from the worst of world costs. The bickering spawned bumper stickers in Alberta that offered to “Let the Eastern Bastards Freeze in the Dark!”

In counterpoint to the 1970s' divisive forces, a nationalist reaction reinforced official anxiety about the vast proportions of Canada owned by foreigners, mostly Americans. That included all of Ontario's automakers and almost all of Alberta's petroleum business. The heavyweight alien control appeared graphically in an article designed to dispel “fuzzy thinking” on foreign ownership in this magazine's issue of September 1970. It showed the percentages of key Canadian industries owned or controlled abroad ranging from almost 57% of manufacturing and close to 61% of mining, to about 83% of Canada's oil and gas wells. Ottawa's response was first, in 1971, the Canada Development Corp., to put money into domestic ventures. Then, in 1974, the Foreign Investment Review Agency came into operation, which turned out to be not much of a barrier to takeovers as long as they promised to create jobs.

The kind of cross-border and transatlantic business that sounded happier notes included Joni Mitchell, Neil Young and Rompin' Ronnie Hawkins' The Band, all providing accompaniment to such spillover fashions and fads from the late 1960s as the miniskirt, the unisex bell-bottom pants and the turtlenecks that supplanted the tie. And helping out against inflation was the early-boomer expansion of the number of double-income families or partnerships — even the DINK (Double Income, No Kids) idea.

As for surfacing from the decade's sea of troubles, that, too, was a bit of same old, same old. It was novelist Margaret Atwood who published a reminder in her 1972 book Survival: A Thematic Guide to Canadian Literature that the capacity of the Canadian to surmount difficulties is what this country has always been all about.

Excerpts from Canadian Business

Tens of thousands of people and a number of businesses, including the head office of Sun Life of Canada, moved away from Quebec after the separatist-minded PQ came to power in November 1976. Canadian Business magazine in early 1977, its 50th year of publication, also moved from Montreal to Toronto.

Column: From Ottawa
The year's most important event politically was certainly the triumph of the Parti Québecois [sic] over Quebec's Liberals [Nov. 15, 1976]…. By the end of this year we should have a much better idea whether or not Canada can hang together as a nation, or if we'll be Balkanized, cannibalized, or just plain fragmented.
—Vol. 50, No. 1, January 1977

Where do we go from here?
Canadian economic and financial trends during 1976 evolved in a climate of uncertainty that clearly inhibited the rate of recovery from the recent recession…. It is still early to make a definitive objective appraisal of the effects of the new Quebec government's policies on the provincial and Canadian economies. What is clear is that the level of uncertainty has been raised a notch or two.
—Vol. 50, No. 1, January 1977

WASP joke of the month
All you need to know about the state of business confidence in Quebec is contained in the following joke, now going the rounds in Montreal:

“What's the difference between a house in Westmount and a social disease?”

“Well, sometimes you can get rid of a social disease.”
—Vol. 50, No. 10, October 1977

Companies active
Several companies now encourage office workers to exercise regularly, pointing out that the more they exercise the more fit they will feel, and consequently, the more alert and more capable they will be on the job.

Two companies who have taken the initiative in this are…Sun Life and the C.B.C. They make their auditoriums available for jogging and calesthenics [sic].
—Vol. 48, No. 1, January 1975

How better reading skills can cure executive stress
One of the results of the recent business recession has been an increase in executive depression. Considering the cost of this depression…it's not surprising that medical studies of it have been swift, not to say urgent. But it is curious how these studies have been so exclusively medical–ignoring entirely the sociological impact of Electric Age factors on our lives in general, but in particular on our reading. For reading is perhaps the most crucial executive skill, and is often the bellwether of executive morale….

It is more than a decade since professor Marshall McLuhan, the communications guru, noted in Understanding Media: “…The senior executives, or 'big wheels,' as they are archaically and ironically designated…are among the hardest pressed and most persistently harassed groups in human history.” Since that point was made, the Electric Age has spawned copier, computer, telephone and TV usage of a sort hitherto unprecedented. The executive reading load has become both enormously heavy and enormously difficult to process….

[Executives] tend to be easily distracted by peripheral movements in their work situations, and to be slow in developing sharpness for reading. They may put their hands up to their heads to block out peripheral vision—and soon find themselves enjoying the “rest” more than the read. Their minds wander off in all directions…. [and] today's numerous and tedious meetings entail much “gazing into space” which nurtures brain neglect….

Where [speed-reading practice] restores eye-brain attentiveness…the effect is electrifying for depressed executives.
–Vol. 48, No. 9, September 1975

Reefer gladness
Containerized shipping has turned Halifax from a sleepy navy town to one of the top 25 container ports in the world, the major throughway for goods travelling between central Canada and Europe. What's only becoming apparent now, however, is the boost that containers are giving to Atlantic [provinces'] trade. Regional shippers have suddenly found Europe and other world points at their doorstep, and they're discovering export business that never existed before….

The biggest beneficiaries have been agriculture and fisheries. Unlike bulk shipping, which requires a huge minimum load, containers are ideally suited for small producers.
—Vol. 52, No. 12, December 1979

Paul Hellyer, an MP on and off from 1949 to 1974, unsuccessful candidate for leadership of the Liberal Party in 1968 and the Progressive Conservative Party in 1976, chaired a 1968-1969 federal Task Force on Housing and Urban Development. Here, the following year, he proposed a wide range of reforms–including measures to pump more money into city budgets.

Paul Hellyer on housing — Crisis ahead?
To charge [through property tax] such a high proportion of education and welfare costs to real estate is unfair and illogical. It must come from a wider base…. New family housing of a modest size increases municipal costs more than municipal revenues and, consequently, is restricted or not allowed at all in many cases…. The senior governments must share their revenues with the municipalities in a way which will allow the latter to cope with the problems of development and redevelopment.
—Vol. 43, No. 1, January 1970

Metric mania
The editors wish to point out that, in its tireless quest for editorial clarity, Canadian Business has resolutely resisted, and will continue to resist, the current mania for metric measurement. We believe our readers are as confused and irritated as we are by hectares, kilometres, [sic] kilograms and Celsius. We will therefore continue to describe things as they are — namely, in terms of pounds, ounces, inches, feet, miles and Fahrenheit.
—Vol. 52, No. 11, November 1979