What was the role of the state in the Province of Canada from 1840 to 1867? What was the nature of responsible government during the period? How did the government generate the first Canadian public debt? What were the circumstances and who were the major players defining Canadian economic and financial policy?
Michael Piva's book traces the history of Canadian public debt from before 1840 to Confederation, with particular focus on the Canadian government's policies and management in relation to that debt. The author shows how transportation was more important than trade to Canadian public finance, and how Canadian politicians and financiers managed to get Britain to cover their deficiencies and pay for transportation improvements.
After 1862, due to a self-inflicted deficit and to difficulties in securing loans just to cover interest payments on its accumulated debt, the government was forced to borrow from Canadian sources. This, along with the traditional factors of political deadlock, American civil war, British pressure and a desire for nationality, was a major factor leading to Confederation.
This work is the first study of public finance that goes well beyond an analysis of Canadian public accounts. Through extensive research, using documents in federal archives and Finance Department files as well as various other official papers, Piva presents a clear and thoughtful interpretation of facts and events that has some application even for modern-day deficit financing and the GST.