Life in Canada(1980s & 1990s)

Chapter 7

Terry Fox

Mexico 1986

1987 Canada Cup

Politics• Brian Mulroney (Progressive Conservative) won the

federal election in 1984 after Pierre Trudeau retired.

• He faced a massive federal debt created in the 1970s – retired from office in 1993 disgraced after NAFTA deal and creation of the GST, which decimated the party.

• Jean Chretien (Liberal) became PM in 1993 (until 2003) and worked on ending the practice of running annual deficits.

• By 1998, his gov’t managed to produce a budget surplus (taking in more money than it spends).

New Political PartiesIn the 1990s, Chretien faced increased regional tensions, as Western Discontent increased, and Quebec separatism came to a head:

1.) The Bloc Quebecois

• In 1993, led by Lucien Bouchard, became the official party of opposition. It was a separatist party seeking to achieve Quebec sovereignty.

2.) The Reform Party

• Rose out of the union of the Alliance Party (Western Canada) and the dying Progressive Conservatives in 1993.

• Became the the official opposition after the 1997 federal election.

• The RP rose out of WD, as the Western provinces felt that their concerns were being ignored by the federal gov’t.

• They wanted to reform the constitution to more fairly represent the Western provs.

• They opposed bilingualism or any special status for Quebec, sought to cut social spending, and restrict immigration.

Economy• In the 1980s, Mulroney followed a policy of neo-

conservatism.

• Involved a reduction of gov’t interference in the econ and an increase reliance on the market forces of supply and demand.

• Mulroney cut back family allowances and old age pensions from the wealthy.

• He also favoured business interests as part of his debt-reduction strategy – he believed that strengthening the private sector would help reduce the deficit.

• In spite of his efforts, the annual deficit and the total national debt continued to grow throughout the Mulroney era.

• The Canadian econ shifted from the production of consumer goods to the service industries – requiring a higher skilled workforce and fewer in numbers.

• As a result of these changes and debt reduction strategies, the Canada experienced rising unemployment in the early 1990s and an increased gap between the rich and poor.

• The number of Canadians living under the poverty line (spending more than 55% of income on food, clothing, and shelter) increased as well.

Free Trade• PM Mulroney’s most significant contribution to the

Can econ was the implementation of free trade agreements with the US and Mexico.

• Free trade – a system of trading between countries without barriers such as tariffs (taxes) or quotas (limits on certain goods).

• Mulroney believed that free trade would benefit Can businesses by increasing investment and trade.

1.) Free Trade Agreement (FTA)

• Signed in 1989 with the US

2.) North American Free Trade Agreement (NAFTA)

• In 1994, Mexico joined.

Pros:

• Helped to improve the Can econ by increasing trade with the US

• By leading to an increase in US investment

Cons:

• Can jobs lost due to relocation

• Can companies moved to the US or Mexico

• Can companies sold to US companies

• Overall not successful in the early 1990s due to a continuing global recession.

Canadian-American Relations

1.) CANADARM

2.) The Strategic Defense Initiative (SDI)

3.) Pacific Salmon Wars

4.) Landmines

5.) The Kyoto Accord

6.) The War on Terror