by Denis Smith
The message from A.V. Roe was less reassuring. Late in the afternoon Diefenbaker received an “extra rush” telegram from Crawford Gordon.
As a result of telegrams of termination of the Arrow and Iroquois programs have found it necessary to suspend all operations at Malton with exception of essential plant protection our officers meeting with officials of the department of defence production Monday to discuss termination procedures earnestly request meeting with yourself and ministers of defense and defense production at your earliest convenience to discuss future government wishes in connection with employment of Malton facilities technical personnel and labour force urgent reply.156
Avro and Orenda had closed the factories and dismissed their employees within moments of the announcement. The prime minister was shocked. “A more callous act would be hard to imagine. Yet I was the one who was excoriated and condemned. Every effort was made to place the responsibility on me.”157 Next morning his friend Oakley Dalgleish placed the Globe and Mail’s leading editorial, “The Beginning - and the End,” on the front page. He offered more disquiet. “The important thing, the only important thing,” Dalgleish wrote, “is the future of the engineering, technical and research establishment that brought the Arrow into being.”
The Prime Minister’s judgment on the Arrow and its future must as we have said, be accepted. The fact remains, however, that the Government has no program or policy by which to put anything in its place. It is on this fact, we believe, that the Government’s decision - and the consequences thereof - must ultimately be judged…
The Prime Minister now tells us there is nothing to put in the place of the Arrow. We will share only in the development of the Bomarc program, and the nature of that sharing is disagreeably clear. We Canadians will be allowed to dig the hole; the Americans will put up the building. That simply is not good enough.
And here is the irony of it. Most Canadians will recall that in the early postwar years we were not permitted to share defence production with the United States; the reason the United States gave being that we lacked the necessary “know-how.” So, at great trouble and cost, we acquired the “know-how.” Still, there was no sharing. And now, what? Now, the brilliant array of engineering and technical talent which built up this great Canadian industry will be dissipated. Now, these highly-trained men and women - the one national asset - will probably go. Where? To the United States.158
This was the reaction of a political friend. That evening there was another, from Leslie Frost. He had learned of the decision when he was passed a note in the Ontario legislature reporting a news announcement of the cancellation. He wired Diefenbaker:
Strongly urge finding substitute work and programmes not necessarily governmental taking place of Arrow as I discussed previously with Fleming. People of course concerned with Arrow decision as it effects Canadian independence but fundamentally the public alarm is caused by mass unemployment and the plight of a large number of municipalities which will create an acute problem if reasonable alternatives not found … While the Arrow decision is important the primary problem is what is to be done as a result. On this depends public reaction. All expect collaboration of industry and government … All Ontario government services are available … in finding a reasonable solution.159
For Washington, Bomarc-SAGE, the radars, and the nuclear commitment were the significant elements in Diefenbaker’s announcement. But at home in February 1959 they had no substance. What mattered to Avro, to Toronto, to Ontario was the sudden and brutal loss of thousands of jobs. Crawford Gordon, in his desperation, knew how to dramatize that loss. He used the loudspeakers on the production floor and sent his displaced workers home to their families. Diefenbaker, the politician, for once in his life had neglected the local effects of his acts. He was outsmarted and embarrassed. Dalgleish and Frost expressed the resulting doubts and anxieties of Diefenbaker’s own cabinet and caucus. They still supported him. But faced with the substance and manner of the decision to scrap the Arrow, they began, nervously, to reassess their commitment. The Chief knew it, and put up his guard.
February 23, 1959, was the fiftieth anniversary of the flight of the Silver Dart at Baddeck, Nova Scotia - the first powered flight in the British Empire.160 Cabinet’s prime business when it met that morning was to prepare its defences for an emergency debate on the end of the Arrow. Members noted that “the two principal points of criticism … were, first, that no efforts had been made to provide alternative employment for the Avro workers and, second, that Canada would be still further dominated by the United States.” Three lines of defence were discussed: Avro had been “well aware” of the likelihood of cancellation, but had made no alternative plans; the decision rested on “the best military advice available”; and substitution of the Bomarc for the Arrow would involve large savings. But ministers implicitly conceded failure on the issue of American domination.
As regards the point that cancellation would mean that Canada would be still further “under the wing of the U.S.,” it should be remembered that maintaining freedom from U.S. control was a continuous struggle. It might appear that the present decision was a retrograde step. But there would be other opportunities to assert Canadian sovereignty and independence. For example, it might be necessary in the near future to introduce legislation to ensure the independence of Canadian companies.
It would be unwise to blame the U.S. for the outcome of the Arrow contract.161
Instead, the relationship would be given a positive spin. This outcome was not an example of domination but of integration, and out of it would come the growing benefits of a Canadian share in American defence production contracts.162
Paul Hellyer, who led the opposition’s attack on the government, took the expected line that the decision was sudden, harsh, and destructive of an advanced Canadian industry. He urged Diefenbaker to take “some immediate, positive, forward-looking action … to stop the exodus of Canada’s future from this country, and to bring about that vision of national development which he has placed before us.”163 Mike Pearson added that “it has been our major indictment of the government since the day this session began that it was guilty of fumbling, confusion and delay in its policies, and guilty of failure to plan ahead. There could surely not be any better example of this than the situation which now confronts us.”164 But Pearson did not directly challenge the government’s decision - except to ask why it had been so long delayed. On the central issue of a joint defence policy with the United States, he gave his support for hard bargaining to assure that Canada would receive more than the “tag ends of orders and nothing else.”165 Pearson’s most emphatic disagreement with the prime minister came over the control of nuclear weapons. He agreed that Canada should possess “the most modern and effective weapons.” He agreed that Canada should not manufacture nuclear weapons, but should obtain them from the United States if they were necessary for defensive purposes. But in that case “they should be under Canadian control, and … arrangements to this end should at least be attempted with the United States authorities.”166 The opposition’s attack was remarkably mild - and even supportive in its defence of the Canadian against the American interest in the affair.
The prime minister’s response began in amused ridicule of his opponents for their own inconsistencies. But he was soon attacking the Liberal Party for wanting his government to “squander nearly $800 million of the taxpayers money” merely because a project was already under way. “I realize,” he insisted, “that defence production is an important weapon in the battle against unemployment. However, I say with all the seriousness that I can put at my command, that the production of obsolete weapons as a make-work program is an unjustifiable expenditure of public funds.” He cited similar decisions to abandon advanced fighter planes in the United States and the United Kingdom. He too believed that the government should seek a “fair and just distribution” of defence contracts with the United States, but warned against demanding too much of the nation “on whose
shoulders rests in large measure the maintenance of freedom not only of our country but generally throughout the free world today.”
Then Diefenbaker turned to the accusation that seemed to trouble him most: that Avro had been taken by surprise. He pointed to editorial after editorial during the previous autumn that took the September decision as notice of cancellation; and he accused the company of mounting an intensive lobbying campaign to save the Arrow, a campaign that had cruelly deceived its own workers about what was coming. He poured it on. The company had been constantly advised, consulted, and warned by ministers and officials, but had made no practical suggestions for alternative projects. Finally, he denounced the company for abruptly dismissing its employees. Avro knew what the decision would be; and it also knew that there was $50 million in the estimates to meet the company’s readjustment costs. That day, in fact, the company was calling back 2500 of its staff. “I say that its attitude in letting out thousands of workers, technical workers and employees, on Friday, was so cavalier, so unreasonable, that the only conclusion any fair-minded person can come to is that it was done for the purpose of embarrassing the government.”167
This was a spirited defence, made in the prime minister’s familiar manner: by attack. Diefenbaker had done something to lessen the political damage of the dismissals, and felt satisfied that he could turn away from the decision and move on. In the weeks that followed, the government negotiated termination contracts with the company, and eventually decided that the seven existing CF-105s should be blowtorched to scrap.168
“Then let them eat cake!”
THE LESSON THAT EMERGES IS NOT THAT THE DIEFENBAKER GOVERNMENT MADE AN autonomous decision to stop production of the Arrow. It is that both development and cancellation took place under the friendly guidance of the US Department of Defense and the US Air Force, within their changing calculations of the Soviet threat and the American interest. American guidance came at three levels - technical, military, and political - through consultation among associates who shared common purposes. Usually the Canadians accepted American proposals without dispute. Development proceeded without question until April 1958, when the Americans suggested that Canada should accept the Bomarc-SAGE missile and ground control systems on Canadian territory as the latest elements in defence of US Strategic Air Command bases. The Canadian desire to be a good and self-respecting partner dictated acceptance, sharing in costs, and Canadian local control. For Canada this added burden meant that the costs of the Arrow would be too high for political acceptance - unless the production run could be substantially extended through sales to the US Air Force. But when George Pearkes went to Washington in August with that request, he came home instead with no sales and Bomarc-SAGE tucked under his arm. From that time on, Pearkes favoured cancellation of the Arrow on the grounds of cost and revised American estimates of the Soviet threat.
There is no evidence that Diefenbaker challenged the judgments Pearkes brought back from Washington. He accepted Bomarc-SAGE without question. He accepted as a matter of solidarity that Canada should join the United States in arming its defensive weapons with nuclear warheads. He shared the financial anxieties of his puritanical finance minister. And he took for granted that an American aircraft would have to be acquired, in time, to take the place of the Arrow in the common defence system. Only within this general scheme could it be argued that the Arrow was uneconomic. But Diefenbaker, as the fervent advocate of Canadian independence, had no interest in clarifying the full circumstances, or in admitting that the decision was encouraged, welcomed, and effectively dictated by the Pentagon. Perhaps he did not fully understand what had happened; perhaps it was better for him not to try.
Seen in this light, scrapping the Arrow was the easy decision for Diefenbaker, not the difficult one. The economic dislocation was unfortunate, and the prime minister’s repeated postponements showed both his human and political sensitivity to that prospect. But putting the Arrow into production and service after August 1958 would have meant an early decision to defy American defence plans, although it seems conceivable that the Eisenhower administration might have shown its reluctant understanding. He had no wish to do so. In February 1959 Diefenbaker preferred to cut costs and take applause from Washington rather than Toronto, where he believed himself invulnerable. The Arrow’s sacrifice, he hoped, would put Canada in a strong position to bargain for a real share in American defence contracting - and the criticism he faced gave him useful support in that bargaining. The defence production sharing agreements were the eventual result. Diefenbaker’s reputation for courage and fighting spirit was enhanced, because he had faced down an industrial giant. But otherwise the outcome was discouraging. Avro Canada never recovered, and thousands of scientific and technical staff moved south to the United States. Canadian pride in the country’s achievements and potential was undermined. And the cabinet revealed a kind of political ineptitude that few observers had expected. It was deficient in analytical power, and in the most elementary talents of manoeuvre and compromise. “This action,” reflected Leslie Frost, “was the beginning of the decline of the Diefenbaker government. The method adopted completely lost the confidence of business and industry. In a space of some ten months, the overwhelming vote of confidence of March 1958 was completely lost.”169 The accusations of fumbling and confusion had begun to stick. The weaknesses of the ministry were those of the prime minister himself.
CHAPTER 10
“History Is a Hanging Judge”
1959-1961
FOR DIEFENBAKER THE ARROW DECISION WAS NOT A PARTICULARLY troubling one. He had a united cabinet and caucus, and faced an opposition reluctant to criticize the government’s logic. The press, too, was broadly sympathetic and took the prime minister’s cue in calling for real American concessions on the sharing of defence contracts. Diefenbaker was in good spirits, still exhilarated by his mastery of parliament and his command of the headlines. A week after the Arrow cancellation he wrote to his brother: “This has been a pretty terrible week. From last Friday when the announcement was made until today everything that could be said in the way of criticism has been said, but I think there has been a change for the better in the last few days. I have always found that strong criticism of a proper course disappears when the facts catch up with the fiction.”1
Shortly before the decision he had attended the annual dinner of the press gallery, where “everybody had a lot of fun at my expense. That is in the order of things.” He could afford the good humour, in his satisfaction with power and the assurance of a place in the pantheon. He urged his mother and Uncle Ed to give him their memories of the family because “all this will be needed in the years ahead when my biography is written.”2 While rummaging through old files he had discovered a relic that might have more current and light-hearted use.
I found a notice of arrest that was served on me in 1928 by the police when we were travelling in Northern California, for having committed the alleged offence of cutting in. You will remember that I was to be locked up until the date of trial but was finally released and had to pay a heavy fine.
The University of California wants to give me an Honorary Degree and if at any time I am able to accept I intend to produce the certificate of arrest so that they will appreciate the kind of treatment that was handed out to me, now thirty-one years ago.3
And those honorary degrees kept piling up. In the spring there were more, from Mount Allison, Western, Montréal, the Royal Military College (“the first Honorary Degree they have ever presented”), Michigan, and Princeton. Diefenbaker was losing count. “I keep you advised as to how many LL.D’s and DCL’s &c.,” he told his mother in April, “and with the others in the next few weeks it will bring the number up to around twenty-two.”4 On his way to Lansing, Michigan, in early June he counted twenty; but after Princeton a week later, he again counted twenty.5
Diefenbaker maintained a punishing schedule of cabinet meetings, attendance in the House, speeches, continual travels, chats with cron
ies, and unscripted interviews with visitors to the prime minister’s office. Entire school classes or individual students on their first, wide-eyed tours of the Parliament Buildings sometimes ended up in the prime minister’s office to hear riveting monologues from the Chief after chance encounters with him in the corridors. Such diversions kept his timetable in chaos and his staff in knots. But they knew nothing could be done to change him: He loved his audiences too much for that. They fed him and buoyed his spirits.
The cabinet’s marathon sessions continued. The economy and unemploy-ment were constant preoccupations, turning to obsessions at budget time. Before presentation of the 1959 budget in early April, six meetings of cabinet lasting a total of twelve hours were devoted to detailed dissection of Donald Fleming’s proposals, which called for tax increases of $350 million to cut the current year’s deficit by half in 1959-60 and a continuing tight rein on new expenditures. The minister of finance faced “a welter” of contradictory counterproposals in an exercise he found “almost degrading.” He blamed this on Diefenbaker’s “lack of experience and a certain timidity” in a field outside his competence: “He had no thought that a budget should be an entity and that the Minister of Finance needs some freedom in constructing it.” But Fleming was tenacious in defence of his conservative position, and finally the cabinet came round to it. When Fleming presented it to the House on the evening of April 9, it was greeted with general praise by commentators as a moderate and judicious contribution to economic recovery. The Liberal and CCF responses - criticizing high taxes, spending, and deficits in the light of Conservative election promises - seemed harmless enough in the circumstances. Diefenbaker might have saved hours of his ministers’ time by guiding them quickly into support for Fleming’s proposals, but he seemed incapable of doing that.6
