Canadian immigration and the North Atlantic Trading Company 1899-1906: A controversy revisited

Journal of Canadian Studies, Fall 1997 by Petryshyn, Jaroslav

Although Canadian immigration history (1896-1914) has been intensively studied and well documented, at least one aspect remains to be clarified -- the role and significance of the North Atlantic Trading Company (NATC). In 1899, Clifford Sifton sanctioned a controversial contract with the NATC whereby the Company acquired a monopoly on all Canadian immigration promotional work throughout continental Europe and Scandinavia. While the Laurier administration maintained that the NATC was a legitimate organization which gave good value for the money spent, critics of the government charged that the NATC was a fraud, taking large sums of public funds for services not rendered. The purpose of this paper is to examine the origins and activities of the NATC and to ascertain whether it was an effective agency for procuring immigrants or an elaborate fraud perpetrated by corrupt officials.

Under the astute direction of Clifford Sifton, Minister of the Department of the Interior (1896-1906), the Laurier administration embarked upon an enormous campaign to secure immigrants for settlement and development of the North West. The results were highly successful: thousands of agriculturists from various nations of the world poured onto the Canadian prairies. This segment in Canada's immigration history has been intensively studied and well documented; however, at least one aspect remains to be clarified -- the activities of the North Atlantic Trading Company (NATC).

In 1899 Sifton sanctioned a long-term contract with the NATC whereby the company acquired a monopoly on all Canadian immigration promotional work through continental Europe and Scandinavia. The company received large sums of money by way of bonuses paid on immigrants landing in Canadian ports. Two government officials were the chief architects of the deal -- W. TR. Preston, Commissioner of Emigration and James A. Smart, Deputy Minister of the Interior. Preston initiated the negotiations and consummated the contract while Smart orchestrated its acceptance in the Department of the Interior. Both men insisted that the agreement be kept secret from the Canadian public and Parliament.

When the government-NATC arrangement finally became public in 1905, a rancorous debate ensued in the House of Commons. Detractors believed the NATC to be a fraud, "raking-off" government funds for services not rendered. As well, they accused Preston and Smart of conspiring to make substantial personal profits as close associates of the NATC while acting as government representatives.

These allegations led to an investigation of the whole matter by two parliamentary committees -- the Select Standing Committee on Agriculture and Colonization (A & C) and the Select Standing Committee on Public Accounts (PA). Yet, after hundreds of pages of testimony from dozens of witnesses the central question remained unresolved. Was the NATC a legitimate organization that carried out its obligations diligently, diverting thousands of immigrants to Canada who otherwise would have gone to the United States or South America, or was it another instance of corruption and fraud perpetrated in the highest levels of the government bureaucracy?

To date, most of the secondary literature has been favourable to the NATC. John Dafoe, in his laudatory Clifford Sifton In Relations To His Times, propagated the view that the NATC was a respectable organization instrumental in procuring for Canada "discriminating" immigrants from Europe and Scandinavia, and that the "scandal campaign" against the government and its contract with the Company was the result of partisan politics which, in retrospect, would prove groundless.' Dafoe took Lauder, Sifton, Preston and Smart at their word, and so have subsequent historians. For example, while allowing that the NATC "... raised the suspicions of graft and misappropriation. ..." Mabel Timlin concludes in her 1960 article that "there is nothing in the Sifton or Lauder Papers to justify such suspicions."(f.2) Sifton's most recent biographer, David Hall, argues that the NATC was part of Sifton's grand strategy of increasing European immigration to Canada. According to Hall, Sifton was chagrined that Canadian efforts at enticing the vast agricultural population to Canada were not producing the required results, and on coming to office he was determined to make European recruitment run in a more efficient, business-like fashion. The agreement with the NATC seemed to facilitate this; by handing the monopoly to the Company, it centralized immigration work and allowed it to be carded out more systematically.(f.3) Hall does not dispute Sifton's contention that the NATC earned its keep, providing a steady flow of suitable immigrants and getting paid only for results. D.H. Avery, J. Lehr and J. Petryshyn(f.4) generally concur in their studies.

The one dissenting voice on the subject is Pierre Berton. In his "popular" account of the settling of the West, Berton accuses historians of being far too gentle on Sifton and his appointees, pointing to the NATC affair as a prominent example of a series of scandals in a department fife with corruption. He suggests that in giving the NATC "a clean bill of health" and crediting the company with playing "a key role in bringing European immigration to Canada" historians have misinterpreted the true nature and activities of the NATC. According to Berton "[A]ny investigative reporter pouring over the... evidence... must come to the conclusion that ... [the NATC] was very largely a boondoggle created by Preston for his own personal profit with the connivance of Sifton's deputy, James Smart."(f.5)