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AUTO PACT:
CREATING A BORDERLESS NORTH AMERICAN
AUTO INDUSTRY, 1960–1971

The 1965 Canada–U.S. Automotive Products Trade Agreement funda-

mentally reshaped relations between the automotive business and the
state in both countries and represented a significant step towards the
creation of an integrated North American economy. Breaking from
previous conceptions of the agreement as solely a product of intergov-
ernmental negotiation, Dimitry Anastakis’s Auto Pact argues that the
‘big three’ auto companies played a pivotal role in – and benefited
immensely from – the creation and implementation of this new auto-
motive regime, which effectively erased the Canada–U.S. border.
Drawing from newly released archival sources, Anastakis demon-
strates that, for Canada’s automotive policymakers, continentalism was
a form of economic nationalism. Although the auto pact represented
the end of any notion of an indigenous Canadian automotive industry,
significant economic gains were achieved for Canadians under the
agreement. Anastakis provides a fresh and alternative view of the auto
pact that places it firmly within contemporary debates about the nature
of free trade as well as North American – and, indeed, global – integra-
tion. Far from being a mere artefact of history, the deal was a forebear
of what is now known as globalization.

dimitry anastakis is an assistant professor in the Department of His-

tory at Trent University.
This page intentionally left blank
Auto Pact

Creating a Borderless North American

Auto Industry, 1960–1971

DIMITRY ANASTAKIS

UNIVERSITY OF TORONTO PRESS

Toronto Buffalo London
 www.utppublishing.com
© University of Toronto Press Incorporated 2005
Toronto Buffalo London
Printed in Canada

ISBN 0-8020-3903-0 (cloth)

ISBN 0-8020-3821-2 (paper)

Printed on acid-free paper

Library and Archives Canada Cataloguing in Publication

Anastakis, Dimitry, 1970–
Auto pact : creating a borderless North American auto industry,
1960–1971 / Dimitry Anastakis.
Includes bibliographical references and index.
ISBN 0-8020-3903-0 (bound) ISBN 0-8020-3821-2 (pbk.)
1. Canada. Treaties, etc. United States, 1965 Jan. 16. 2. Duty-free
importation of automobiles – Canada. 3. Duty-free importation of
automobiles – United States. 4. Automobile industry and trade – Canada.
5. Automobile industry and trade – United States. I. Title.

HD9710.N672A53 2005 382’.456292’097109046 C2005-901501-2

University of Toronto Press acknowledges the financial assistance to

its publishing program of the Canada Council for the Arts and the
Ontario Arts Council.

University of Toronto Press acknowledges the financial support for

its publishing activities of the Government of Canada through the
Book Publishing Industry Development Program (BPIDP).

This book has been published with help from the AUTO21 Network of
Centres of Excellence.
For Victoria
This page intentionally left blank
Contents

Tables ix
Acknowledgments xi
Abbreviations xiii

Introduction 3

1 The Canadian Auto Industry, 1900–1963 17

2 Canadian State Intervention in the Auto Industry and the

Failure of Automotive Free Trade, 1963–1964 43

3 The Big Three and the Creation of a Borderless

Auto Industry, 1965 74

4 The Implementation of the Auto Pact, 1965–1966 103

5 Managing the Borderless North American

Auto Industry, 1965–1968 124

6 Consolidating the Borderless North American

Auto
Industry, 1968–1971 147

Conclusion: The Borderless North American Auto

Industry, 1971–2001 172
viii Contents

Appendix A. Text of the Automotive Products Trade Agreement, 1965 185

Appendix B. Sample Letter of Undertaking, Ford Motor Company of
Canada 191
Appendix C. Automotive Statistics, 1960–1999 195

Notes 203
Bibliography 255
Illustration Credits 277
Index 279

Illustrations follow page 114

Tables

1.1 Evolution of Canada’s auto tariffs, 1879–1936 21

1.2 Canada’s auto industry, 1950–1960 26
1.3 Canada’s automobile parts and accessories industry,
1950–1960 26
1.4 Canada’s trade with the United States, automotive products,
1955–1963 27
2.1 Canada’s trade with the United States, automotive parts,
1960–1964 48
5.1 Motor vehicle production in Canada, Big Three and total
industry, 1963–1968 127
5.2 Original equipment parts production in Canada, 1963–1968 127
5.3 Employment in the auto industry in Canada, 1963–1968 133
5.4 Canadian production-to-sales ratio requirements, Big Three and
American Motors 136
5.5 Canadian value added (CVA) requirements, Big Three and
American Motors 136
5.6 Big Three Canadian value added (CVA), required and
produced, and total CVA as a percentage of sales, by model
year, 1965–1972 140
5.7 Big Three ratio required and achieved, cars and trucks, by model
year, 1965–1972 141
5.8 Canada’s auto industry, total Canadian value added,
1965–1972 145
6.1 Canada–U.S. automotive vehicle production and each country’s
share of total, 1964–1971 151
C.1 North American vehicle production summary, 1960–1999 196
C.2 North American production-to-sales ratio, vehicles,
1960–1999 197
x Tables

C.3 Canada’s automotive trade with the United States,

1960–1999 198
C.4 Canada’s automotive trade with all countries, 1960–1999 199
C.5 Big Three Canadian value added, required and produced,
and total CVA as a percentage of cost of sales, by model year,
1965–1979 200
C.6 Big Three ratio required and achieved, cars and trucks, by model
years, 1965–1978 200
C.7 Canadian auto industry, Canadian value added, both required
and produced, and as a proportion of sales, 1965–1979 201
Acknowledgments

This book began as a doctoral dissertation in the Department of History

at York University. At York, John Saywell, Chris Armstrong, Viv Nelles,
and Robert Cuff all deserve thanks for helping to shape it. I could not
have asked for a better group of mentors and teachers. Chris Armstrong
was an excellent supervisor for the project, and has remained extremely
supportive and helpful. As a mentor and friend, John Saywell is in a
class by himself. I simply cannot imagine where I would be today if I
had not had the good fortune of being his student and research assis-
tant. My professional and personal debt to him is great.
I also appreciate the many comments I received from people over the
years as this project was completed: Dianne Labrosse, Penny Bryden,
Steve Penfold, and Dennis DesRosiers all read earlier versions of the
book or papers derived from it. Archivists in Ottawa, Toronto, Oakville,
Washington, DC, Detroit, Boston, and Austin all deserve thanks for
their help.
I would also like to thank everyone at the University of Toronto Press.
Len Husband has been an excellent editor and a kind friend. I want to
thank him for his support, patience, and encouragement. I would also
like to thank the three anonymous reviewers, Frances Mundy, and Kate
Baltais, whose excellent work improved the writing considerably.
A few other individuals and institutions also deserve thanks. Maureen
Appel Molot of Carleton University was an excellent postdoctoral su-
pervisor, and has been incredibly helpful to me in finishing this book
and providing feedback and comments on much of my work. The
AUTO21 Network of Centres of Excellence provided funding and sup-
port towards the completion of the book. Peter Friese, Bill Woodward,
and the rest of the staff at AUTO21 are to be commended for their
xii Acknowledgments

continuing support of the social science investigations into the automo-

bile and its impact on Canadian society. I would like to thank the
Canada-U.S. Fulbright Foundation, and everyone at Michigan State
University, where I enjoyed a wonderful academic visit in 2003. I also
spent a productive term at the University of Toronto’s Munk Centre as a
Social Sciences and Humanities Research Council of Canada postdoctoral
fellow. Other grants towards the completion of the project were pro-
vided by the Ramsay Cook Fellowship at York University, an Alfred D.
Chandler, Jr, Traveling Fellowship from the Harvard Business School, a
John F. Kennedy Foundation Research Grant, and a Moody Grant from
the Lyndon B. Johnson Foundation. I thank all these institutions for
their support.
Simon Reisman, W.W. Rostow, Philip Trezise, Jake Warren, Tom Kent,
C.D. Arthur, Dennis DesRosiers, and J.F. Grandy all agreed to be inter-
viewed for the project, and I thank them. Dennis DesRosiers kindly
allowed me to reprint his company’s statistical tables in the appendices.
More personally, I would also like to thank my parents Angela and
Ernie Anastakis, and my friends and colleagues Matthew Evenden,
Magda Fahrni, Chris Frank, Sarah Elvins, Steve Penfold, Joseph Tohill,
James Muir, Jeet Heer, Janet Miron, and Stephen Henderson.
Finally, I would like to express my greatest thanks and appreciation
to my best friend and wife, Victoria Yankou. Without her patience,
understanding, and help, this book would be much less than it is today,
as would its author.
Abbreviations

AMC American Motors Corporation

APTA Automotive Products Trade Agreement
APMA Automotive Parts Manufacturers Association (Canada)
ASIA Automotive Service Industries Association (U.S.)
CACC Canadian Automobile Chamber of Commerce
CUSFTA Canada–U.S. Free Trade Agreement
CVA Canadian value added
DEA Department of External Affairs
DFAIT Department of Foreign Affairs and International Trade
DISC Domestic International Sales Corporation
DPSA Defence Production Sharing Agreement
FTA Free Trade Agreement
FMC Ford Motor Company
GATT General Agreement on Tariffs and Trade
GM General Motors Corporation
IET interest equalization tax
ITC Industry, Trade and Commerce, Department of
JDTC job development tax credit
MFN most favoured nation
MVMA Motor Vehicle Manufacturers Association
MVTO Motor Vehicle Tariff Order
NAFTA North American Free Trade Agreement
NSC National Security Council (U.S.)
NTBs non-tariff barriers
SUB supplemental assistance benefits
TAB transitional assistance benefits
xiv Abbreviations

TEA Trade Expansion Act, 1962 (U.S.)

UAW United Auto Workers
USTR U.S. trade representative
WTO World Trade Organization
AUTO PACT
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Introduction

As conditions unfolded after the Second World War, nothing defined a

nation’s industrial maturity or its international economic standing like
the success of its automotive industry. In the 1950s and 1960s, the cars
coming off the assembly lines in Detroit represented the ultimate in
terms of the American dream and the post-1945 ascendancy of U.S.
industry, technology, culture, and economic might. For the war-torn
countries of Western Europe, the slow rebuilding of their auto indus-
tries marked a return to economic prosperity and what they considered
to be their rightful place among the nations of the ‘developed’ world.
For a devastated Japan, the stunning emergence of its auto industry in
the 1960s and 1970s was nothing less than a ‘miracle’: The ubiquitous
‘Japanese import’ became the unmistakeable sign that Japan had joined
the modern world and had become a leading industrial nation.1
For Canada, the auto industry also symbolized a coming of age. After
the war, Canada had one of the most successful auto industries in the
world, even if this was largely by default, as the country had escaped
the destruction of the war and shared in the benefits of a wider North
American boom in population and consumer demand. A successful
auto industry meant that Canada was perhaps free of the limitations of
its economic past, with its dependence on the seasonal extraction of
staple goods. For a time, it seemed as if the growing and prosperous
auto sector would finally break Canada out of its resource-based
economy and lead it into a securely industrial economic age.
Yet by the early 1960s, this most important sector of Canada’s indus-
trial economy faced a deepening crisis. High tariffs on automobiles and
the early penetration and domination of the Canadian market by U.S.-
owned companies had created a classic branch plant economy that was
4 Auto Pact

not able to cope with the new realities of the fast-changing industry. The
protected Canadian sector was hampered by a small market, inefficient
plants dating from the war or earlier, production techniques that could
barely keep up with the latest technological changes and consumers
demanding the same wide range of models as was available to their
American friends and relatives just across the border. Worse yet, the
rusting Canadian industry depended heavily on imported American
parts. This helped generate a massive trade deficit with the United
States, approaching half a billion dollars by 1963. Auto parts from the
United States accounted for more than 90 per cent of Canada’s total
trade shortfall and this situation was becoming a threat to Canada’s
finances.
The realities of the auto industry limited Canadian possibilities for
taking action in the sector, however. The governments of Conservative
Prime Minister John Diefenbaker (1957–63) and Liberal Prime Minister
Lester Pearson (1963–8) knew that dramatic measures were needed and
that any of their available choices involved immense danger. Greater
protectionism in the industry was a costly political and economic choice,
one that could lead to fewer American-designed cars in Canada, per-
haps some production of ‘all-Canadian cars,’ and certainly a greater
number of unhappy Canadian citizens. Free trade in automobiles with
the overwhelmingly U.S.-dominated industry, the other logical choice,
and the solution for the Canadian sector’s difficulties that the Ameri-
cans were forcefully pressing, could result in the end of production in
Canada and the ensuing loss of thousands of jobs and economic devas-
tation for the country as a whole. Studies, royal commissions, and two
different tariff manipulation programs to help the auto industry by
encouraging exports to the United States had only made the choice
more stark. By 1964 Canadian auto tariff measures had so infuriated the
administration of President Lyndon B. Johnson in the United States that
Canada’s automotive dilemma threatened to turn into a continental
trade war, worsening by far an already difficult period in Canada–U.S.
relations.
Greater protectionism or freer trade, the two choices for the auto
industry with which Canadian policymakers grappled, reflected the
larger currents that were shaping discussions of Canada’s economic
future. The 1960s were a decade during which ideas of free trade and of
protection coexisted uneasily and jockeyed for attention. Many Canadi-
ans had begun to think of working towards an economically integrated
North America, as they observed the slow integration of the European
 Introduction 5

continent on a free trade basis and participated with enthusiasm in the

growing and influential General Agreement on Tariffs and Trade.2 At
the same time, a new nationalism was emerging in Canada, led by the
mercurial Walter Gordon – Pearson’s finance minister – that was calling
on Ottawa to protect Canadian industry and resist the creeping conti-
nental integration with the colossus to the south.3
Faced with these two extremes, Canadian policymakers negotiated
an ingenious third way that resolved the difficulties of the industry,
provided the benefits of both protectionism and freer trade, and pointed
to a new direction for the North American economy. The Canada–U.S.
Automotive Products Trade Agreement – or auto pact – was signed by
Prime Minister Pearson and President Johnson at the latter’s Texas
ranch in January 1965. The agreement would create a borderless North
American auto industry. It would allow continental duty-free trade in
auto products, if with certain specific limiting provisions governing
each country. Imports to the United States could only come from Canada
and had to have 50 per cent North American content to be duty-free. In
Canada, specified manufacturers who maintained regulated Canadian-
content levels and continued to produce as many vehicles in Canada as
they sold in Canada could import duty-free from any country, although
the United States was the most likely source. On the face of it, the auto
pact provided for selected free trade in the automotive sector, advanced
American goals for trade liberalization in North America, and avoided
a difficult trade dispute between Canada and the United States. It was a
tightly managed agreement: For their part, Canadians could take com-
fort in the production guarantees that ensured them what they consid-
ered to be a ‘fair share’ of the North American automotive market and
reflected the nationalistic goals of the policymakers who had negoti-
ated the agreement.
The auto pact was heralded as a success and evidence of close ties
and cooperation between Canada and the United States. But the two
governments were not the only parties responsible for solving the prob-
lems of the North American auto industry. General Motors, Ford, and
Chrysler – the Big Three multinational automotive corporations – proved
key to resolving an impasse that the two governments by themselves
could not, namely, the gap between U.S. expectations for free trade and
Canadian demands for a fair share of the North American automotive
industry. The structure of the North American auto industry, particu-
larly the cross-border U.S. ownership and similarities in markets and
tastes, enabled the Big Three to work together with both Ottawa and
6 Auto Pact

Washington towards the creation of a new, managed trade regime. In

addition to production guarantees outlined in the agreement itself, the
auto companies promised to increase their Canadian content and in-
vestments in Canada, in the short term, in ‘letters of undertaking.’ The
letters of undertaking made assurances that Canada would receive its
fair share of automotive investment and production and were crucial to
the consummation of the agreement. Without the letters of undertak-
ing, the Canadian government would not have agreed to the new
arrangement. These state-directed investment and production mea-
sures provided a further element of protectionism that the Canadian
negotiators sought in securing the future of the Canadian auto industry.
The automakers agreed to them as the price of rationalizing their opera-
tions on a continental scale.4
In return, the conditional nature of the agreement ensured that the
U.S. multinationals remained the predominant manufacturers of motor
vehicles in North America. Conditional free trade for producers – not
consumers – was to govern the new borderless continental auto trade.
The auto companies’ operations could now range freely across the
whole continent, unimpeded by national borders or national tariff con-
straints. The Canadian auto industry was irreversibly integrated into a
larger North American auto sector, and the auto agreement tied the fate
of the Canadian economy even more securely to the fortunes of the
United States. The auto pact remained in effect in the United States
until the 1989 Canada–U.S. Free Trade Agreement (CUSFTA) and in
Canada until February 2001, when the World Trade Organization (WTO)
ruled that it violated international trade rules.5
By the time that the pact passed out of existence, it was clear that the
Canadian auto industry had benefited immensely from the conditional
trade regime that had been in place for thirty-six years. After 1965, as
the Big Three fulfilled their requirements under the program, Canadian
production and employment increased immensely. The Canadian trade
deficit in automotive products disappeared, and by the 1990s, Canada
had a massive trade surplus in the overall North American automotive
sector. The share of Canadian production in the continent’s auto indus-
try grew impressively. Canadians produced fewer than one in twenty of
the cars manufactured in North America in 1964. By 1999 Canadian
factories were turning out nearly one of every five vehicles produced in
North America, while Canadians were exporting nearly $100 billion
dollars worth of automotive goods annually. One in seven Canadians
could trace their employment either directly or indirectly to the auto
 Introduction 7

industry. This impressive growth was reflected in the motor vehicle

parts industry, as well. Initially, some Canadian parts companies with-
ered under the auto pact; however, others flourished in the new
borderless competitive environment and became giant industrial enti-
ties, such as Magna International, Wescast, and the ABC group.6 Al-
though physically centred in southern Ontario, by the end of the
twentieth century the automotive industry dominated the entire Cana-
dian economic landscape.
The creation, implementation, and consolidation of the auto pact
regime in North America between 1960 and 1971 was one of the most
significant events in the recent political and economic evolution of
North America, and a major step towards the creation of a continental
economic community.7 It is therefore an excellent case through which to
examine a number of questions fundamental to the development of
Canada within a North American context in the 1960s. To begin with,
how did the Canadian state manage to achieve such an outcome, what
was the nature of this state intervention, and to what extent was this
state intervention limited by domestic and international constraints in
the auto industry? How does Canada’s auto pact experiment fit within
the context of other international experiences during this period, wherein
a number of other countries also engaged the multinational automotive
firms in their midst? How does the evolving relationship between big
business and the state (particularly between multinational firms and host
countries) help to explain the outcome of the auto pact regime? Finally,
what can the auto pact, which became a foundation stone for an emerg-
ing North American economic community, tell us about the changing
nature of relations between Canada and the United States in this period?
First, we must consider the question of how the state creates public
policy in the context of domestic and international constraints, in this
case, in the auto industry. Canadian policymakers had long experience
in utilizing various governmental means to foster Canadian industrial
‘defensive expansionism,’ as is reflected in the automotive duty-remis-
sion programs created by Ottawa in 1962–4. Canadian civil servants
used the tools available to them to shape outcomes in Canada’s auto
industry. This state intervention to further national economic develop-
ment took the form of innovative incentive programs designed to spur
exports, a goal that butted up against the interests of the United States.
When the Canadian measures provoked U.S. resistance, state actors in
both governments competitively and aggressively negotiated in efforts
to achieve the best possible outcome for their side.
8 Auto Pact

To understand this process requires an examination of state actors,

those ‘rational planners’ who are either restricted to an inevitable fate
by the proponents of rigid political and economic models or are given,
by whiggish historians and biographers, too much influence in shaping
outcomes. Such interpretations often seem insensitive to the realities of
both international relations and history. Simply put, it was not just
faceless bureaucrats who created the auto pact, and the agreement was
not inevitable given circumstances within the North American and
global auto industries.8 Yet, it is impossible to imagine the creation of
the 1965 auto pact without Simon Reisman and, therefore, consider-
ation must be given to the motivations of this determined Canadian
negotiator and his dedicated team of civil servants. Their experiences
helped guide government responses to the automotive industry’s diffi-
culties, and their innovative solutions resulted in an unprecedented
departure for what was, and remains, Canada’s most important eco-
nomic sector. Other actors, too, such as the unions or the automakers –
constituent structural parts of the industry – had a role in determining
the responses of the state. These factors all affected each other: The
planners (and their personalities) shaped the agreement to fit the con-
tours of the industry’s structure. These factors were, in turn, all shaped
by the historical and contemporary specifics of Canada–U.S. relations
and the dynamics of the U.S., Canadian, and North American auto
industries.
People learn from their past. The auto pact emerged as it did, in part,
because the Canadian civil servants who negotiated it remembered
their unhappy experience in an earlier case: the farm implement case.
In 1941, Canada entered into a continental agreement that resulted in a
significant decline in the Canadian share of North American produc-
tion of farm implements. Ottawa policymakers were still well aware of
that experience.9 Certainly, civil servants such as Reisman had learned
(the hard way) that this was an outcome they wanted to avoid. They
also understood that the legacy of Canada’s automotive branch plants
was going to be difficult to overcome, but it might also hold the key to a
new departure that would take advantage of the Canadian auto sector’s
proximity and close ties to the U.S. industry. Thus, the agreement
integrated the auto industry on a continental basis, and for Canadian
policymakers, paradoxically, this continentalism was a form of eco-
nomic nationalism. Far from exposing the Canadian auto sector to the
harsh realities of an unrestricted continental market, the auto pact
 Introduction 9

ensured that it benefited through the fair share production and invest-
ment guarantees that Reisman and his team achieved as terms of the
agreement.
Planners and politicians both are constrained by the internal dynam-
ics that shape a state’s responses to any situation. On questions of
policy, governments are often portrayed in a simplified, onedimensional
manner, acting as singular interests. But this certainly cannot be said of
the United States in this case. Enactment of the auto pact was compli-
cated greatly by the separation of powers that exists between the U.S.
Congress and the president, and long-standing conflicts over which of
the two was ultimately responsible for determining U.S. trade policy
threatened passage of the agreement. Furthermore, conflict erupted
within the administration among the State, Treasury, and Commerce
departments over how to shape the U.S. response to the ‘Canadian auto
problem.’ Although the dynamics of interbranch and interjurisdictional
competition have been well documented for other important trade
issues in recent American history, the auto pact has not been a focus of
these efforts.10 The Canadian response to the auto problem was far less
conflicted. It was shaped by a number of factors including the fused
nature of the executive and legislative branches in the structure of
Canada’s government, the smaller civil service in Ottawa, and the basic
fact that the auto issue and relations with the United States were at the
top of the federal government’s agenda. Nonetheless, within the gov-
ernment different approaches to the auto negotiations were favoured,
as protectionist politicians like Walter Gordon and civil servants more
favourable to freer trade solutions like Simon Reisman worked together
to formulate the Canadian strategy.
Second, the creation of the Canada–U.S. auto pact needs to be under-
stood within the postwar context of the automotive sector elsewhere in
the world. As in Canada, during the 1960s, governments in Brazil,
Mexico, and Australia took a far more active role with regard to their
automotive industries. These countries had some things in common
with Canada, for example, widespread penetration by U.S. multina-
tional auto companies, little or weak indigenous vehicle assembly and
parts production, and, hence, difficulties with their international trade
balances. In response to these conditions, the range of intervention by
these host countries included increased local content rules, wholesale
nationalization (or the threat thereof), and innovative approaches to
import substitution. These efforts achieved varying levels of success,
10 Auto Pact

and civil servants in ‘auto-dependent’ countries everywhere were work-

ing the range of interventionist policies that would yield the best out-
comes of automotive investment to the host country.11
Brazil used infant-industry and import-substitution methods to im-
prove its production, but encouraged foreign capital to help build its
domestic industry. Brazil’s state-directed goals for the domestic auto
industry were limited to some degree by the vagaries of market-driven
transnational corporations. Nonetheless, the Brazilian automotive in-
dustry, which was virtually non-existent in the 1950s, flourished in the
1960s even with its very high requirements for local content.12 Mexico –
after threatening to nationalize the industry outright – forced the multi-
nationals, in its 1962 and 1969 automotive decrees, to increase their
local content and focus on export production. This intervention strategy
was only partially successful because of both internal and external
factors, namely, the resistance of the multinationals, the realities of
productivity and efficiency levels in Mexico, and the pressures of inter-
national competition.13
These examples help to explain the Canadian government’s interven-
tion in the auto industry in the period 1960 to 1971. Most of all, Cana-
dian policymakers in the 1960s effectively used the models of state
intervention that these other countries had implemented to contrast
their own position with that of American officials and representatives
of the Big Three, as they searched for a way to resolve the difficulties
faced by Canada’s auto sector. In the words of one U.S. negotiator, the
Canadians kept ‘the sombrero under the table’ and continually re-
minded the United States that if the negotiations failed to achieve their
preferred outcomes, they had recourse to measures such as the harsh
decrees that Mexico had imposed on the U.S. multinationals.14 With
economic arch-nationalist Walter Gordon as the Canadian finance min-
ister, the U.S. government, and the U.S.-based multinationals took quite
seriously the possibility that Canada might follow the Brazilian and
Mexican examples.
The models employed in Brazil and Mexico themselves help to ex-
plain the approach taken by Ottawa. The case of Brazil showed that
unrestrained market forces or direct state intervention were not the
only possibilities for state planners to consider when developing poli-
cies for the auto industry. Mexico City’s interaction with the automotive
industry has strong similarities with the Canadian experience. In shap-
ing the Canada–U.S. auto pact, the Canadian state was not a mere
functionary of capital, nor was it without any agency of its own. The
 Introduction 11

Canadian state did make choices, and these choices were tempered by
international, national, and historical experiences that Ottawa and its
representatives understood, as did the other actors within the Canadian
environment. They had numerous constraints, yet they did have some
choice.15
The Canadian case also departs from those of Brazil and Mexico in a
number of important ways. Most obviously, Canada was not as depen-
dent on the United States as were industrially underdeveloped Brazil
and Mexico.16 After the Second World War, Canadian economic for-
tunes came increasingly under the influence of the United States, yet
Canada demonstrated a large degree of independence in the period, as
evidenced by its willingness to embark on aggressive export incentive
programs typified by the automotive measures it instituted in 1962 and
1963. Even ‘dependent’ Canadian companies, such as Ford of Canada,
had an independent streak that broke from traditional notions of sub-
servience. Until the 1960s, Ford of Canada maintained its own overseas
empire in Australia and New Zealand, quite independently of the U.S.
parent corporation. Differences also hinged on the issue of commonal-
ity. Although for political and economic reasons the Mexican govern-
ment could never have tolerated wholesale integration into the U.S.
auto industry in the 1960s, Canada could and did because of its close
relationship with the United States, the long-standing presence of the
Big Three in Canada, and the similarity of both markets and consumer
tastes in the two countries.
Canada’s case departs from the Latin American and Australian expe-
riences for another fundamental reason. Whereas other countries sought
greater direct and national control over their auto industries, Canadian
policymakers sought to tie their industry’s fate to that of another nation
on a continental basis, one that would be managed by the industry itself.
Obviously, this alternative had long-term implications for Canada that
differed dramatically from these other international examples. In Bra-
zil, Mexico, Australia, and other countries, the emphasis was on import
substitution, local content, nationalization (or the threat of nationaliza-
tion) in the name of greater domestic control that was to be powerfully
directed by the state. In the case of Canada, state actors sought to
improve Canadian production, but within the context of a continentally
integrated industry, a context that reflected the economic and political
realities facing Canadian policymakers. The goals directed by the
Canadian state were to be achieved through working in cooperation
with the manufacturers in ways that were unique to the Canadian and
12 Auto Pact

North American situation. The Canada–U.S. auto pact came into being
because of the particular difficulties presented by the immediate
circumstances surrounding the pre-1965 shape of the automotive
industry.
In a very real sense, the auto pact was a milestone in the evolution of
Canada’s economic history. It marks a transition from the old protec-
tionist National Policy of John A. Macdonald to the new national policy
of free trade that was embraced by Canadian policymakers in the 1980s
and 1990s. The Canada–U.S. auto pact represents a shift in Canadian
policy, from the defensive expansionism of tariff protection through the
post-1945 efforts to liberalize trade, with an eye towards further na-
tional development, to the market-driven ethos espoused by Canadian
policymakers after 1982.17 The auto pact emerged from the unilateral
tariff-manipulating remission programs that were developed by civil
servants in the years 1962 to 1964, and contained elements of state-
directed investment, while providing for duty-free trade in the automo-
tive sector. The auto pact’s unique production and investment guarantees
ensured Canadians their fair share of the automotive market. The auto
pact was a product of its time, and it represents the confluence of the
free trade and protectionist ideas that prevailed in Canada in the 1960s.
In the context of international trade regimes, the Canada–U.S. auto pact
marks a clear step towards both freer trade and the creation of a re-
gional trade bloc in North America.
Third, we must appreciate that the role of non-state actors in the
creation of this international trade treaty is the auto pact’s most impor-
tant characteristic. Although many interpretations of the pact’s evolu-
tion focus almost solely on the role of the two governments, without the
agreement of the U.S.-based multinationals the auto pact could not
have been consummated, and its structure clearly reflects the involve-
ment of the Big Three.18 An analysis of the interaction of the multina-
tional auto companies and governments on both sides of the Canada–U.S.
border allows us to examine the complicated relationship between
business and the state and how companies and states can play each
other off to achieve their desired outcomes. Furthermore, it allows us to
examine the differing positions in response to the state initiatives taken
within particular industries in the automotive sector. Various actors
among the manufacturers as well as among the parts makers, on both
sides of the border, reacted differently, reflecting the wide range of
interests within the industry.
The auto pact shows that Canadian governments could influence
 Introduction 13

multinationals to achieve their own goals. The complex relationship

between the Canadian government, the U.S. government, the Canadian
subsidiaries of the Big Three, and the parent corporations of the Big
Three together gave Canadian policymakers opportunities to further
their goals – opportunities not usually present in business-government
interactions. The agreement illustrates, too, the influence that foreign
companies can have with the Canadian government and in playing
governments off each other to attain their desired outcomes.19 This
‘triangular diplomacy’ resulted in winners and losers in the bargaining
process between states and firms and demonstrates the complex rela-
tionship in the 1960s between nations and multinational firms.20
At no time were the wishes of the Big Three the sole factor in deter-
mining the final shape of the agreement. Nevertheless, the motives and
actions of these giant U.S. multinationals were essential in facilitating a
solution to the troubles of the Canada–U.S. automotive sector. The struc-
ture of the automotive sector in North America was unique, and the
auto pact could not have been duplicated in any other sector of the
economy or between any other two countries in the world. With 90 per
cent of the ‘Canadian industry’ owned and operated by three major U.S.
multinationals, concentrated and located but a stone’s throw from De-
troit, and servicing market tastes virtually identical to those of the United
States, the automobile industry afforded opportunities not present in
any other sector. Moreover, negotiation of the Canada–U.S. auto pact
took place by calling on, quite literally, only a handful of people. Imple-
mentation was just as simple, and required little state action. The auto
industry was a very exclusive club, and industry associations such as
the Motor Vehicle Manufacturers Association (the Big Three plus Ameri-
can Motors, International Harvester, and Studebaker) could count on
regular access to government officials. This intimacy greatly eased in-
teractions between government and business in shaping the new regime.
The importance of the auto companies in the creation and implemen-
tation of the agreement was matched by their role in keeping the agree-
ment safe from those in the United States who wanted to destroy it.
After 1968, when elements of the U.S. government wished to abrogate
the pact because of its adverse effects on the U.S. balance of payments,
the Big Three were pivotal in ensuring the agreement’s survival. In-
deed, the divergence of interests between the U.S. government and the
U.S.-based multinationals is an essential component to a proper under-
standing of the agreement and its role in shaping the relationship
between states and multinationals. This divergence of interests was
14 Auto Pact

especially stark during the administration of President Richard Nixon,

when American pressure to change or end the auto pact was greatest.21
Ironically, given its fair trade elements, the auto pact marks a funda-
mental step towards corporate globalization. The severing of national
corporations from national interests created supranational entities which
were no longer burdened by international borders – a significant step in
making transnational companies truly global enterprises. By 1970 the
Canada–U.S. auto pact had brought home the brutal reality to U.S.
policymakers that what was good for General Motors was no longer
necessarily good for the United States.
Finally, fourth, the auto pact provides a touchstone against which to
examine an especially sensitive moment in the evolution of the relation-
ship between Canada and the United States. In the mid-1960s, relations
between the two countries were at a particularly low ebb. Conflicts over
a wide array of trade and foreign policy issues ranging from magazines
to selling wheat to recognition of China to seafarers’ unions throughout
the Kennedy and Johnson administrations, and the Diefenbaker and
Pearson years, were at times almost debilitating. Relations were consid-
ered so poor by President Kennedy that he initiated a cross-border
study that might clarify for him why things were so bad with America’s
northern neighbour and supposedly closest friend and ally; the result
was the controversial Heeney-Merchant report entitled Principles for
Partnership.22 It should perhaps be remembered that the auto pact was
signed in January 1965, just four months before, in a speech he made at
Temple University in Philadelphia, Pearson famously infuriated Johnson
by calling for a temporary halt to American bombing of the North
Vietnamese.23 Yet for all of the not inconsiderable fallout from that
incident, Johnson never once wavered in his determination to see the
auto pact passed by the U.S. Congress.
An examination of the auto agreement must account for how such a
divisive issue was resolved so quickly and – or so it seemed at the
time – successfully. The Canada–U.S. auto pact only makes sense within
the larger context of this cross-border relationship if one considers the
various models that have been advanced as explanations of the course
of relations between the two countries. The auto pact is not evidence of
the mythical ‘special relationship’ between Canada and the United
States.24 Nor does it illustrate any particular strain of Canada’s ‘depen-
dency’ on the United States.25 Instead, the auto pact shows that the
relationship between Canada and the United States has been based on
cooperation, punctuated by short bursts of conflict over specific issues,
 Introduction 15

although the particulars of the auto agreement require a more complex

reading.26
The notion of a Canada–U.S. relationship based upon cooperation
and some conflict suggests a basic interdependence between the two
countries that necessitates their working together to resolve conflicts.
The case of the Canada–U.S. auto pact bears this out. The auto pact
shows that realist approaches to international political economy are
insufficient for understanding the multitude of political, cultural, in-
dustrial, trade, and military factors that make up relations between
states. Instead, complex interdependence, in which countries and their
governments exercise power beyond the usual military and diplomatic
arenas, approximates more closely the interactions between and among
nations. Differing international regimes play key roles in shaping the
complex interdependence. Relationships such as that between Canada
and the United States, for example, need to be viewed in global terms
rather than seen simply as bilateral. The United States acceded to
Canada’s demands in the automotive field to advance the cause of
trade liberalization and to avoid what may have developed into a
destructive and embarrassing trade war with its closest ally – not be-
cause it felt some special feeling towards Canada. This helps explain
why Canada apparently won many of its postwar conflicts with the
United States, including achieving its fair share of a North American
auto industry that was almost entirely owned by Americans. This was
not an insignificant accomplishment, given the constraints Canada
faced.27
All of these factors – the role of the state, the international context, the
part played by the U.S. multinationals, and the nature of Canada–U.S.
relations at the time – in combination explain how the auto pact was
consummated and why it took the shape that it did. Yet, the story of the
auto pact is also much more than this. It is an ironic tale of how
Canadians, through their nationalistic determination to secure for them-
selves a greater share of the immense North American automotive
industry, embarked on a new and innovative path that ultimately turned
Canada’s economic (and, to a lesser extent, political) organization to-
wards a continental destiny. In seeking to secure forever a vibrant auto
industry, Canada’s negotiators of the auto pact were undoubtedly suc-
cessful, but possibly they also got more than they and Canadians had
bargained for.
This book divides the story of the Canada–U.S. auto pact into six
chapters. Chapter 1, as background, traces the development of the
16 Auto Pact

Canadian auto industry from its very beginnings under the National
Policy to the creation of innovative tariff manipulation schemes de-
signed to solve the structural crisis that the industry faced by the late
1950s and early 1960s. Chapter 2 examines the adverse reaction of U.S.
policymakers in response to these unilaterally taken Canadian initia-
tives, and the failure of intergovernmental negotiations to resolve the
cross-border trade problems. It goes on to explain why the Canadians
rejected the free trade plan that the United States offered and instead
held so strongly to their fair share demands for the Canadian automo-
tive industry. Chapter 3 shows how the Big Three and the auto industry
itself provided a unique solution that was both protectionist and for
free trade to the impasse between Canadian fair share demands and the
Americans’ desire to see the sector operate on an unrestricted free trade
basis. Chapter 4 analyses how during its implementation opposition to
the auto pact failed in Ottawa, Washington, and at the General Agree-
ment on Tariffs and Trade (GATT) in Geneva. Chapter 5 examines the
auto pact’s impact on the Canadian sector as the automotive industry
rationalized its operations on a North American basis and the problems
that emerged as the two governments and the industry learned to
manage the new continental regime. Chapter 6 details how the auto
pact survived attempts to end or modify it in the face of renewed trade
difficulties and cross-border differences over the meaning and opera-
tion of the agreement. The transformation of the agreement following
the 1989 Canada–U.S. Free Trade Agreement and its eventual demise at
the hands of the World Trade Organization in 2001 are briefly explained
in the Conclusion.
This monograph does not purport to be a political or economic his-
tory of Canada in the 1960s or a complete examination of Canada–U.S.
relations of that era. Essentially, this is a history of the creation of a
borderless North American automotive industry which had a signifi-
cant influence on the politics and economics of the period. Thus, not
every incident that may have in someway influenced the outcome of
the auto issue is examined here in detail, and some significant issues of
the period receive but cursory treatment. The many stories of firms,
communities, and individual workers who were all so deeply affected
by the pact and by how the auto industry operated were left out, not
because these stories are unimportant, but because the focus here is on
the policy decisions critical to the origins and implementation of the
Automotive Products Trade Agreement of 1965.
1
The Canadian Auto Industry, 1900–1963

The issue of protectionism versus free trade, which has bedevilled

Canadian leaders since Confederation, was central to discussions on
the automotive industry. The National Policy, the main plank of Canada’s
economic strategy for most of the country’s history – and the most
significant factor in shaping the Canadian auto sector – emerged from
the failure of Canada’s first prime minister, Conservative John A.
Macdonald, to establish a free trade regime with the United States.1 In
1879, therefore, the Macdonald government put in place a tariff struc-
ture that, for example, made finished goods entering Canada dutiable
at a rate of 35 per cent. The framework survived for decades, as over the
next half-century Macdonald’s party transformed itself into the party of
protection. Meanwhile, the Liberal party had advocated free trade since
before Confederation, but disastrous defeat in the elections of 1891 and
1911 convinced them that free trade could be pursued only in the most
prudent manner. Thus, protection, albeit in a less stringent form than
that advocated by the Tories, became part of Liberal policy as well.2
By the 1920s the Canadian auto sector was among the protected
industries, having grown up as a ‘creature of the tariff.’3 The tariff rate
of 35 per cent set in 1879 applied to carriages and established the rate
for automobiles, which at the end of the nineteenth century were called
‘horseless carriages.’ Some of the carriage makers converted their facili-
ties in an effort to take advantage of the protection afforded by the tariff
wall (particularly in southern Ontario), resulting in numerous indig-
enous attempts to create a viable Canadian motor car company, but
virtually all of them failed. More often the Canadian firms lacked
technological capabilities and were short on capital, or they were sim-
ply unable to sell enough of their product in such a small, scattered, and
18 Auto Pact

poorly linked market.4 Even with the high protective tariff, the Cana-
dian companies were hard-pressed. A few attempted to survive by
importing cheaper American parts (at 30 per cent, the duty was lower
than that for completed autos). In 1921 the last one, Gray-Dort, went out
of business after its American parts maker closed its doors, and soon no
strictly Canadian-owned concerns were left in the auto industry.5
South of the border, in the late nineteenth century the U.S. auto
industry flourished, as hundreds of new companies and firms took off
from the Midwestern carriage industry, much of which was centred in
Michigan. Led by Henry Ford and his company in Detroit, the Ameri-
can auto industry grew impressively, as American manufacturers de-
veloped new and innovative production and sales techniques. By the
end of the First World War, the U.S. auto industry required massive
economies of scale to make production profitable, because of its intense
capital requirements, and its need for engineering ingenuity and exten-
sive sales and dealership networks. As in Canada, many companies
could not compete in an industry that required such large-scale produc-
tion. By the 1930s, after a period of intense consolidation, the General
Motors, Ford, and Chrysler corporations stood as the undisputed Big
Three of the automotive industry.6
The large American automakers that remained had penetrated the
Canadian market as well, using Canadian labour and raw materials,
but importing American capital, management, technology, and parts.
Ford was first in Canada, with its plant at Windsor, Ontario, built in
1904 – directly across the river from Detroit. Canadian Gordon McGregor,
whose own firm, the Walkerville Wagon Works, was seeing its last days,
managed to convince Henry Ford to partner with him to produce Ford’s
products at McGregor’s converted wagon factory. Although the early
Canadian automotive market was tiny (McGregor personally delivered
each vehicle during the first few years), with the introduction of the
Model T in 1908, the Canadian Ford firm grew spectacularly.7
The largest indigenous Canadian car manufacturer had been Oshawa’s
McLaughlin Motor Works. It became part of General Motors after
Sam McLaughlin decided to join the company founded by William
Durant. McLaughlin’s decision in 1918 gave GM a beachhead in Canada
from which GM would secure its position as Canada’s leading auto
manufacturer. It also established Oshawa, Ontario – along with Windsor
– as a centre of the Canadian automotive industry. Chrysler was the last
of the Big Three to arrive in Canada, when in 1921 it built its plant in
Windsor. From then on, 90 per cent of the Canadian auto industry was
 The Canadian Auto Industry, 1900–1963 19

based in southern Ontario, either in Windsor or around Toronto, where

the Canadian companies were close to their American parents. Because
of these branch plant operations, between 1918 and 1923 Canada was
the second-largest motor vehicle producer in the world. By 1926 the
Canadian industry was building more than 200,000 vehicles a year,
while it employed some 12,000 people.8 A small Canadian parts indus-
try developed alongside the American-owned manufacturers, supply-
ing assemblers with various parts and thereby contributing to increasing
the proportion of Canadian content in the U.S.-designed vehicles. In
1913, for example, Ford of Canada began building a significant portion
of its own engines and transmissions, using parts supplied by dozens of
small Canadian producers that had sprung up in Windsor, Ontario. By
the beginning of the next decade, nearly three-quarters of Canadian
Ford’s parts were being made in Canada.9
Much of the Canadian vehicle production was intended for the do-
mestic market, but a significant proportion was exported to other areas
in the British Commonwealth. Canada was within the imperial prefer-
ential system and so maintained a lower import tariff of 22.5 per cent
for the mother country and its fellow dominions. The imperial system
added another dimension to the Canadian branch plants, as it encour-
aged U.S. companies to assemble their products in Canada and then
export them from Canada to gain the benefit of the lower duties. The
Ford Motor Company of Canada, thus, held exclusive rights to market
Fords in Australia, New Zealand, South Africa, India, and a host of
other Commonwealth destinations.10
This was a lucrative business. Canadian exports of autos and auto
products to the United Kingdom and other Commonwealth countries
were valued at more than $33 million in 1924, while in 1925 nearly half
of all passenger cars built in Canada were exported.11 Ford of Canada
took the most advantage of the imperial preferential system, but the
other American-owned companies (and they were usually wholly owned
subsidiaries) made hefty profits from building cars in Canada and
selling them in Canada and overseas.12 Canadians benefited from this
economic boom through increased employment and production. In this
sense, the tariff was a success, at least in Ontario.
With Ontarians receiving the full benefits of the new industry, other
regions of Canada complained, claiming that they were unfairly subsi-
dizing the operations of U.S.-owned companies in Ontario. The import
tariff was at the heart of such criticism, and by the late 1920s the issue
was being intensely debated as a question of regional inequality. De-
20 Auto Pact

pendent for his survival on the largely western-based pro-free trade

Progressive party, Liberal Prime Minister William Lyon Mackenzie King
took the precarious position of lowering tariffs in order to stay in office
after the 1926 federal election. Instead of a general 35 per cent rate, the
auto tariff would be tied to the price of cars: those priced at $1,200 and
under were to be taxed at 20 per cent, while those over $1,200 would
have a tariff of 27.5 per cent. Thus, the average weighted general rate
became 26 per cent when added excise taxes were factored in. King also
established a non-partisan Tariff Board which he hoped would de-
politicize the issue.13
The lower rates, however, helped little when the Great Depression
took hold of the industry. After 1930, the Canadian sector, which had
been such a force in the 1920s, slipped badly as world trade ground to a
halt. Commonwealth export markets dried up, and so did consumer
demand in Canada. In 1929 Canada produced 203,000 cars, almost
65,000 of them for export. But in 1931 Canadian factories built only
61,000 vehicles, and not even 10,000 of them were exported. The Con-
servative government of R.B. Bennett (1930–5) agreed to duty-free en-
try for autos coming from the United Kingdom, which was a curious
departure from his pledge to ‘blast’ a way to markets with more tariffs.
However, the duty-free treatment for British vehicles was of little conse-
quence at the time, although it proved crucial in the future.14 King and
the Liberals were returned to power in 1935, but they were no more
effective in solving the problems caused for Canadians by the economic
downturn.
In 1936, following an examination by the Tariff Board, the Tariff Act
was significantly altered. The new most-favoured-nation (MFN) tariff
(which stipulated that the rate given to a country’s most favoured
trading partner should be extended to all of the country’s other trading
partners) was 17.5 per cent for all autos and most auto parts. The most
important change to the act was a new sliding scale for duty-free entry
based on the proportion of a car’s Commonwealth (essentially Cana-
dian) content. To gain duty-free designation for a selection of imported
parts, a company’s cars had to have 40 per cent Commonwealth content
if it was annually producing 10,000 units, 50 per cent if it was producing
between 10,000 and 20,000 units, and 60 per cent if producing more
than 20,000 (see Table 1.1).15 The new tariff schedule had the effect of
facilitating significant Canadian production, although the auto parts
made in Canada were usually much more expensive than their U.S.
 The Canadian Auto Industry, 1900–1963 21

Table 1.1 Evolution of Canada’s auto tarifs, 1879–1936

A Early tariffs (%)

General Intermediate British

tariff tarriff preference

Finished autos,
1879–1925 35 30 22.5
Parts,
1879–1936 35 30 22.5

B Finished autos, 1926–1930 (%)

General Intermediate British

Autos valued at tariff tariff preference

$1,200 and under 20 17.5 12.5

Over $1,200 27.5 25 15

C Finished autos, 1931–1935 (%)

General Intermediate British

Autos valued at tariff tariff preference

$1,200 and under 20 17.5 0

Over $1,200 27.5 25 0
Over $2,200 40 0

D Tariff revision of 1936 (%)

Most-favoured- General British

Item nation tariff tariff preference

Finished autos 17.5 27.5 0

Products of
parts makers 17.5 30 0
Products of
automakers 17.5 if made in Canada;
duty-free if not made in
Canada and car makers
production is: 40% Common-
wealth content if fewer than
10,000 cars; 50% Common-
wealth content if 10,000–
20,000 cars; 60% Common-
wealth content if over
20,000 cars 25 0
22 Auto Pact

Table 1.1 (Concluded)

D Tariff revision of 1936 (%)

Most-favoured- General British

Item nation tariff tariff preference

Parts of commercial 17.5 if made in Canada; duty-

vehicles free if not made in Canada
and commercial vehicle
makers production is 40%
Commonwealth content
(no scale) 27.5 0
Parts not included
in above 25 35 0

Note: Parts of a class or kind not made in Canada were duty-free, while those of a kind
made in Canada were subject to a 25% duty. If certain parts contained 50% Common-
wealth content, the duty was remitted.
Source: Compiled from Vincent Bladen, Royal Commission on the Automotive Industry
(Ottawa, 1961) and Tom Traves, The State and Enterprise: Canadian Manufacturers
and the Federal Government, 1917–1931 (Toronto, 1979).

equivalents. The duty-free status granted to any parts of a ‘class or

kind’ not made in Canada allowed the major auto manufacturers to
import substantial quantities of expensive parts, particularly main body
stampings and complex transmissions, that could only have been built
in Canada at a prohibitive cost. Thus, for example, headlights were
built in Canada by the Canadian Lamp Company, and therefore any
import of such parts was dutiable, while automatic transmissions, which
were not built at all in Canada, entered the country duty-free.
The Second World War boosted vehicle production to an all-time
high, although consumer products were restricted. Canadian auto fac-
tories converted to wartime production, and if Detroit was America’s
‘arsenal of democracy,’ surely the Canadian auto industry was just as
important in the Allied war effort. By the mid-point of the war, Cana-
dian Big Three factories in Windsor and Oshawa were producing more
than 4,000 mechanized vehicles per week, and in 1943 Canada’s ‘Minis-
ter of Everything,’ Munitions and Supply Minister C.D. Howe, cel-
ebrated the completion of the 500,000th Canadian-built vehicle.16
Canadian automotive workers at Ford and Chrysler used the war effort
to achieve union recognition, which had been accomplished at General
Motors in 1937.17
 The Canadian Auto Industry, 1900–1963 23

After the plants were returned to civilian production, in 1945, con-

sumer demand pent up through years of government imposed wartime
austerity measures and unleashed also with the return home of hun-
dreds of thousands of veterans led to a massive post-war economic
boom. By the late 1940s the Canadian auto industry was again firing on
all cylinders. Annual production increased from 92,000 to 375,000 units
between 1946 and 1954, and employment in the auto industry went
from 22,000 to 29,000.18 The number of auto plants increased in Canada,
and the country’s parts industry blossomed. The Automotive Parts
Manufacturers Association (APMA) was founded in Toronto, in 1952,
demonstrating the new strength of the parts sector. To keep up with
consumer demand, two years later, Ford built a new plant and head
office in Oakville, Ontario. Labour problems had wracked the auto
sector since the 1930s. In the early postwar years they were much less
prominent as auto workers gained the benefits of the well-functioning
industry. But the postwar boom in auto production was fuelled by more
than just Canadian postwar consumer demand and returning veterans,
as the market for Canadian exports rebounded (although to nowhere
near the prewar level). In the decade between 1946 and 1955, Canadian
automakers exported almost 175,000 autos to Europe and countries of
the British Commonwealth.19
By the mid-1950s the automobile had become the epitome of the
postwar ascendancy of American industrial and cultural hegemony.
Detroit’s new cars became the outward signs of Canadian prosperity,
too, as families moved into the new suburbs that were growing up
around Canada’s cities. In embracing the automobile, Canadians fol-
lowed their American neighbours closely. Canadians purchased many
of the same vehicles as Americans did. Like the Americans, Canadians,
too, designed their homes and communities around the automobile.
And like in the United States, in Canada, too, millions of dollars were
allocated to highway and road construction.20 In the glow of the post-
war overall consumer boom, the auto industry became the cornerstone
of the Canadian economy – and the automobile, the undisputed symbol
of ‘modern’ Canada.
In the midst of this boom period for the Canadian automotive sector,
the industry had problems which lurked just below the surface but
could very quickly become overwhelming should the industry be faced
with any significant downturn. American trends, which Canadians
seemingly inevitably followed, were moving towards an ever-prolifer-
ating range of choices for car buyers and to a level of selection that
24 Auto Pact

Canadian producers were soon going to be hard-pressed to match.

When Canadian automakers could not build all the models in their
parent firms’ full and growing lineups, models not produced in Canada
would have to be imported to satisfy Canadian consumers. So, too,
would the increasingly complex technologies that were needed to pro-
duce these fancy new vehicles. Canadian branch plants lacked the
technological capabilities to build many of the advanced components,
for example, increasingly popular automatic transmissions. Nor did the
Canadian offshoots of the Big Three have the marketing, sales, or orga-
nizational wherewithal to withstand a prolonged slump in Canadian
demand. This was the situation apparent to industry leaders such as
Henry Ford II, who reorganized his Canadian company so that it could
better cope with these postwar automotive realities.21
The boom could not last forever. When the inevitable economic down-
swing began, it coincided in Canada with the surprising outcome of the
1957 federal election. John Diefenbaker’s Progressive Conservative party
ousted the Liberals in 1957 and then routed them thoroughly with their
landslide victory at the polls in 1958. Few had anticipated this turn of
events. During the years of the postwar boom the Liberals, led by Louis
St Laurent, were seen to be effective if staid managers of a Canadian
economy fed largely by American investment. But by the mid-1950s the
Liberals were tired and devoid of ideas, as the economy crept towards
the downturn that was sure to come. The Royal Commission on Canada’s
Economic Prospects (1955–7), chaired by Liberal insider Walter Gor-
don, it had been hoped, would re-energize the party, but proved to be
too little and too late. Diefenbaker was in as prime minister on a mix of
prairie populism and the promise of new faces after twenty-two con-
secutive years of Liberal government.22
Although the Tories were traditionally the party of protectionism,
during his march to power Diefenbaker had advocated new economic
ideas. His ‘Roads to Resources’ plans and vision of Canada’s north as a
spark to ignite economic growth were both romantic and inspirational
concoctions. There was little real planning behind the rhetoric of
Diefenbaker’s vision. Diefenbaker also advocated loosening America’s
ever-expanding grip on Canada’s trade, and in his first weeks as prime
minister, he proposed to divert 15 per cent of Canada’s trade to the
United Kingdom. Artificial redirection of trade would be costly and
politically dangerous, however, and the idea quickly disappeared from
sight.23 Instead of being able to act on his northern vision or diversify-
ing Canadian trade patterns, Diefenbaker was beset by very real and
 The Canadian Auto Industry, 1900–1963 25

pressing economic problems. Unemployment grew after 1958 to a post-

war high of 7 per cent, while the national debt and Canada’s trade
deficit also increased. The Tories were further hurt by controversy over
the activities of Bank of Canada Governor James Coyne, who clashed
with the government over the direction of economic policy. Coyne’s
tight money policies exacerbated problems in an already troubled
economy.24
Predictably, the end-of-decade slowdown in the Canadian economy
was devastating for the auto industry which already was beset by deep
structural problems. Created as branch plants at the beginning of the
twentieth century, the U.S.-owned Canadian manufacturers produced
along American lines. The result was a ‘miniature replica’ of the U.S.
market, where every automaker offered all available models and op-
tions. This degree of choice became unsustainable in Canada during the
consumer-driven 1950s. To offer the same array of car models as their
parent companies, Canadian automakers had to resort to very short
production runs, with costly downtimes while plants retooled. In the
late 1950s and early 1960s, for example, Ford’s engine plant in Windsor
was producing seven different engine blocks for 186 different varieties
of engine! Just across the Detroit River, the Ford plant produced only
one engine, while turning out four times as many assembled units.25
This wide range of vehicle models forced Canadian branch plants to
import the many parts and vehicles not produced in Canada yet neces-
sary to fill out their product lineups. By the end of the 1950s, these
imports represented a structural deficit for the Canadian auto industry
of more than $300 million a year. In the early 1960s, the annual trade
deficit topped the $400 million mark. Both the industry and the federal
government recognized the seriousness of what was quickly becoming
a chronic, structural deficit in Canada’s auto sector (see Tables 1.2, 1.3,
and 1.4).
Adding to the sector’s woes, when the economy took a downswing,
offshore imports began to flood the Canadian market. European and
Japanese automakers, having recovered from the effects of the war,
offered smaller and less expensive models which Canadians preferred
when the economic climate was uncertain. The United Kingdom, in
particular, could export duty-free to Canada because of the tariff poli-
cies established in the 1930s, and by 1960 imports of British cars to
Canada had increased dramatically. This deluge of imports was further
encouraged by a strong Canadian dollar (in 1962 Ottawa devalued and
pegged the Canadian dollar at U.S. 92.5 cents). Nearly one-third of the
26 Auto Pact

Table 1.2 Canada’s auto industry, 1950–1960

Vehicles Vehicles Vehicles

Year Employees produced exported imported Balance

1950 29,355 390,102 34,334 88,528 –54,194

1955 33,428 453,597 18,431 57,949 –39,518
1960 27,683 396,943 20,620 180,029 –159,409

Source: Dominion Bureau of Statistics, and Motor Vehicle Manufacturers Association

(1971).

Table 1.3 Canada’s automobile parts and accessories industry, 1950–1960

Produced in
Year Employees Plants canada ($) Exports ($) Imports ($) Balance ($)

1950 19,719 151 226,539,000 12,036,000 162,298,000 –161,262,000

1955 19,996 188 285,071,000 20,333,000 278,366,000 –258,033,000
1960 15,531 114 288,080,000 34,173,000 325,850,000 –291,677,000

Source: Dominion Bureau of Statistics, and Motor Vehicle Manufacturers Association

(1971).

300,000 cars sold in Canada in 1960 were imports.26 Meanwhile, Cana-

dian exports declined and now represented only a tiny slice of produc-
tion. The impact on the auto industry and on employment was
devastating. Membership in the Canadian arm of the United Auto
Workers union dropped from 33,000 to 27,000 between 1956 and 1960
(See Table 1.2)
Faced with such a threat to the industry and its membership, the
union took action. Canadian UAW director George Burt led a delega-
tion to Ottawa in July 1960 to press the government to consider the
union’s views on how to save the industry. A no-nonsense mechanic
from Oshawa, Burt had been a member of this union since its founding
in 1937 and was voted its Canadian director in 1939. Burt understood
the challenges facing the industry very well. The UAW’s presentation to
the government, entitled ‘How Canadians Can Get a Made-in-Canada
Car They Want and Can Afford,’ called for a radical approach to the
auto industry’s problems. It placed blame for the industry’s woes
squarely on the shoulders of the manufacturers themselves. Nationalis-
tic in tone, the brief declared that the time had come for the Canadian
government to ‘protect the Canadian people.’ The union argued that
 The Canadian Auto Industry, 1900–1963 27

Table 1.4 Canada’s trade with the United States, automotive products, 1955–1963
(Can$ millions)

Year Imports Exports Total Balance

1955 361 4 365 –357

1956 439 4 443 –435
1957 356 6 362 –350
1958 324 9 333 –315
1959 369 17 386 –352
1960 407 4 411 –403
1961 398 9 407 –389
1962 519 16 535 –503
1963 555 40 598 –515

Source: DesRosiers Automotive Yearbook 2000 (Richmond Hill, 2000), 190, and
Statistics Canada cat. nos. 65-202 and 65-203, as cited in John Holmes, ‘From Three
Industries to One: Towards an Integrated North American Automobile Industry,’ in
Maureen Appel Molot, ed., Driving Continentally: National Policies and the North
American Auto Industry (Ottawa: Carleton University Press, 1993), 27.

this could be accomplished by encouraging small car builders to set up

plants in Canada, by boosting Canadian content requirements from 60
per cent to 75 per cent for those companies producing more than 20,000
units, and eliminating the 7.5 per cent excise tax on Canadian-built cars
that had been in place since the 1930s.27
The UAW also argued that the feasibility of closer integration with
the U.S. industry should be explored. More specifically, it suggested a
model that did not impose tariffs on products used by any company
that ‘allocated an appropriate proportion, relative to sales in Canada, of
its total production in Canadian plants.’ The UAW’s idea of a ‘restricted
free trade area’ did not contradict plans to boost content or eliminate
excise taxes, but it did seem to clash with the otherwise nationalistic
tenor of the document. Undoubtedly, Burt had hoped that the document’s
patriotic tone would appease the more nationalistic elements in his
union, which had grown increasingly vocal since the onset of the sector’s
problems. Integration and the UAW’s other ideas, suggested the union,
could be looked at more closely if a Royal Commission were created to
investigate the entire industry.28
Other segments of the auto industry had also begun pressuring the
Tories to do something. Both the Canadian Automobile Chamber of
Commerce (CACC, which in 1962 became the Motor Vehicle Manufac-
turers Association) and the parts makers’ association (APMA) had long-
28 Auto Pact

standing relations with Ottawa and had often made suggestions on

tariff and industry matters during budget time.29 Led by their proactive
president James Dykes, the CACC was an exclusive club that com-
prised the presidents of the major automakers in Canada, that is, GM,
Ford, Chrysler, AMC, and International Harvester. The APMA was a
larger and more diffuse group of Canadian parts makers, both large
and small. Their leader, D.S. Wood, was also a keen lobbyist, although
at times many members of the APMA were not in agreement with the
direction pursued by the association’s leadership. Diefenbaker met with
CACC members in June 1960 to discuss problems in the industry.
Confronted with public demands from the UAW and private plead-
ings by the major manufacturers that something be done to save the
auto industry, the Diefenbaker government moved swiftly. Discussions
with Finance Minister Donald Fleming and opposition member Paul
Martin, Sr, whose Windsor riding was in the heart of Canada’s auto
industry, led to the decision to appoint Vincent Bladen, who was dean
of arts at the University of Toronto, as a one-man Royal Commission.30
English-born and an economist, Bladen was known as fair-minded by
members of the industry and government representatives alike. Al-
though smaller by far than most government inquiries, the Bladen
Commission was extremely thorough, and Bladen was granted wide
scope to conduct his investigation. Bladen held five days of public
hearings in Ottawa, received nearly two hundred public and private
submissions, and personally visited vehicle manufacturers and parts
companies in Canada, the United Kingdom, France, West Germany,
and Sweden, as well as in the United States. Presentations and submis-
sions ranged from those by the Canadian Big Three to the eclectic
advice of Bladen’s colleague at the University of Toronto, Marshall
McLuhan, and Queen’s University historian A.R.M. Lower.31
Most of the submissions came from the industry itself. The major
manufacturers were unanimous in recommending lifting the 7.5 per
cent excise tax on cars built in Canada. In place in some form since
Mackenzie King’s tariff changes of the 1920s and 1930s, the excise tax
made Canadian cars more expensive than duty-free models imported
from Britain. Generally, the automakers favoured reducing tariffs rather
than increasing Commonwealth or Canadian content which, they ar-
gued, would serve to raise costs and lower sales. Three of the five
automakers (GM, Ford, and International Harvester) recommended
some kind of closer integration with their U.S. parent companies. The
APMA took a far more protectionist view. The parts makers’ association
 The Canadian Auto Industry, 1900–1963 29

called for a tariff increase to 17.5 per cent for those within the imperial
preference sphere and 25 per cent for most-favoured nations, an end to
duty-free entry for British autos, and extricating the auto tariff sched-
ules from the General Agreement on Tariffs and Trade. Submissions
from the UAW’s leadership recommended some sort of closer integra-
tion with the United States (which, they expected, would result in wage
parity), while submissions from the nationalist locals demanded higher
Canadian content and more protection, if not outright government
ownership of the auto industry.32 Bladen considered most of the protec-
tionist demands to be untenable, but he was curious about the idea of
continental integration, which had appeared often in submissions to his
commission. The idea had also been in the foreground during Bladen’s
discussions with Big Three executives in Detroit and in New York.33 In
November 1960, Bladen asked a few key witnesses to submit further
thoughts on the issue of continental integration of the auto industry.
The responses illustrated the various positions within the industry.
The automakers were keen on the idea, as long as more onerous content
levels were not a requirement. But, as Ford’s answer indicated, the U.S.
parents were not interested in any concept that cut back on U.S. parts
and auto exports to Canada, which by then were valued at more than
$300 million a year. Substituting Canadian parts, or forcing automakers
to build the whole range of cars that Canadians desired, promised to be
tremendously expensive for the automakers. Parts manufacturers, rep-
resented by the APMA, staunchly opposed the idea of integration,
which they perceived would cause them hardship and create chaotic
conditions in the industry. The ‘cure,’ argued the APMA, ‘would be
much worse than the ailment.’ Instead, the association reiterated what
it said in its original submission to Bladen, which called for greater
protection and increased Canadian content.34
Bladen was definitely influenced by the idea of somehow expanding
production, which underlay the proposed integration plan. As an econo-
mist he understood that Canada could benefit immensely from the
economies of scale that could be achieved under integration. But the
submissions showed that integration would be extremely difficult to
implement and could not be realized without serious dislocations in the
Canadian auto industry. Moreover, continental integration was a highly
charged issue that struck at the heart of Canada’s survival as an inde-
pendent nation, as Bladen himself admitted. He knew, for example, that
the idea of continental integration had torn the Canadian UAW into
pro-integration and nationalist factions.35
30 Auto Pact

When Bladen presented his report to the government, however, there

was little mention of the difficulties that the idea of integration was
fostering within the industry. Instead, he emphasized two points. First,
Bladen expressed his disagreement with most of the pro-integrationist
submissions that any such arrangement required a bilateral Canada-
U.S. agreement. He was convinced that ‘an advantageous scheme of
integration could be implemented by unilateral action.’ Second, Bladen
did not believe that there should be guarantees, as called for by some
advocates of integration, based on employment objectives. An increas-
ing share of production in an expanding market was more important
for Bladen, than assuring jobs.36
Bladen made seven principal recommendations, and they centred
around two main policies that, he argued, should be implemented as a
single plan. The first six recommendations suggested that various auto-
mobile excise and tax changes be considered, as most representatives
had suggested.37 Bladen’s seventh recommendation introduced a novel
concept: an ‘extended content’ plan. Aware that the only way to boost
Canadian productivity and efficiency would be through improving
Canada’s exports dramatically, Bladen suggested that Ottawa allow
companies to import cars and parts duty-free as long as a stated per-
centage of Canadian content was achieved. This would eliminate the
‘class or kind’ distinctions that riddled the tariff. Canadian-made origi-
nal equipment parts would qualify as content whether used in Canada
or exported to another country. Instead of focusing on particular parts,
then, the percentage of duty-free parts and vehicles could be used
anywhere in the product lines, while parts produced in Canada would
be considered as Canadian content if put in vehicles produced in any
country for sale anywhere, thus giving the manufacturer a certain mea-
sure of flexibility. The plan also would have the benefit, Bladen argued,
of keeping auto prices within ‘politically acceptable limits.’38
The extended content plan may have made it easier for smaller
producers to take advantage of the more flexible content rules, but the
bigger manufacturers would now have to include much more Cana-
dian content then they were accustomed to in order to achieve duty-free
status. General Motors, for example, was only required to have 60 per
cent Commonwealth content (it built more than 20,000 vehicles) under
the 1936 Tariff Act. Under the Bladen plan, GM would be required to
include 70 per cent Canadian content, since by 1959 it produced more
than 150,000 passenger vehicles per year in Canada. Bladen’s plan also
would put Canadian parts makers at risk. For the first time, they would
 The Canadian Auto Industry, 1900–1963 31

be forced to compete with American parts makers without ‘class or

kind’ protection. For example, lamps built at Canadian Lamp Company
received 17.5 per cent protection against similar U.S.-made lamps. Un-
der the extended content plan, Canadian Lamp would have to compete
without any protection. Some parts makers could flourish under the
proposal, but many of them would be put out of business. The extended
content plan, if enacted, would represent a dramatic change in the
functioning of the Canadian automotive industry.
Diefenbaker’s response to Bladen’s scheme was tepid. Because the
plan advocated tariff and excise tax changes, Finance Department offi-
cials thought it best to hold off publishing the commission’s report until
the next budget, which was to come out in June 1961. But even before
Bladen completed his study, the Conservative government (and Fi-
nance Minister Donald Fleming in particular) was being pressured to
change the structure of the auto tariff. GM Canada’s president E.H.
Walker had visited Assistant Deputy Minister of Finance A.F.W. Plumptre
in June 1961 to tell him that should certain conditions be met, GM
would start producing automatic transmissions in Canada, which, be-
cause of the costs and high technological demands involved, had so far
not been produced in Canada at all. Bladen estimated that a company
must build 400,000 vehicle transmissions a year to be economical, a
figure larger than that of the total number of units annually built in
Canada. That was why Ottawa, in 1950, had suspended the 25 per cent
duty on increasingly popular automatic transmissions, ensuring Cana-
dian automakers were not left behind without models having auto-
matic transmissions. The terms as outlined by Walker, however, would
put GM in a much more advantageous position relative to its competi-
tors – once GM was exempted from paying duty on the parts and
special components that had to be imported to build automatic trans-
missions. The 25 per cent duty on automatic transmissions would have
to be reimposed on the other automakers to make GM’s plan profitable.
Walker acknowledged that his competitors would no doubt complain if
GM were granted these concessions, but pointed out that the
government’s difficulties in this area would be offset by the increased
employment and production at GM. To make the plan work, Walker
explained, ‘certain arbitrary decisions would have to be taken.’39
Walker pressed the government further by stating that an immediate
response was needed for his plan to be successfully launched. Canadian
officials understood this to be a pre-emptive strike on the part of Canada’s
largest automaker. GM could not know exactly what Bladen was plan-
32 Auto Pact

ning, but it did have the most to lose if any significant changes were
made to the tariff structure, especially with regard to Canadian content.
The giant company, which already controlled more than 50 per cent of
the Canadian market, was taking the initiative in hopes of getting even
more distance between itself and the competition.40
The GM initiative put the government in a difficult situation. In the
past, manufacturers and parts makers had produced joint submissions
whenever they made suggestions to the government on tariff issues;
generally, whenever changes in the industry were contemplated, all
segments were consulted. Walker’s plan was entirely his own. Were it
to present the industry with the GM plan, the government would be
seen as playing favourites. Moreover, the plan could scuttle the Bladen
Commission’s recommendations. The reimposition of the 25 per cent
duty on automatic transmissions was inconsistent with Bladen’s ex-
tended content plan. Not willing to be swayed by Walker’s claims of
urgency, Finance Department officials recommended to Fleming that he
delay any decision until after the Bladen Commission proposals had
been fully assessed.41
Finance officials analysed Bladen’s report between April and June
1961 and concluded that it would be extremely difficult to implement
its recommendations in a single plan. Fleming admitted to Diefenbaker
that Bladen’s proposals were ‘the most imaginative and ingenious’ that
he had seen in a long time. But Fleming also had serious reservations,
and he went as far as to say that he was sceptical or perhaps simply did
not understand some of the recommendations. The excise and sales tax
changes proposed by Bladen were easy enough to implement. Chang-
ing ‘Commonwealth content’ to ‘Canadian content’ could also be
achieved easily. Since virtually all parts in Canadian cars were either
made in Canada or imported from the United States, there would be
little impact regarding those very few parts that were imported from
other Commonwealth countries.42
The difficulties had to do with the tariff recommendations. Fleming
found the extended content plan ‘so radical that, on short notice, one
cannot grasp all the implications.’ Granting duty-free treatment under
the new and untried criteria listed in Bladen’s recommendations would
be to ‘take a real leap in the dark.’ Furthermore, the plan would entail
difficult negotiations with MFN countries to gain concessions in return
for duty-free treatment. These concessions, thought Finance officials,
might offset the problems stemming from the recommended 10 per cent
tariff rate for British autos and parts (which previously had been zero)
 The Canadian Auto Industry, 1900–1963 33

that was sure to cause ‘bitter resentment’ in the United Kingdom and
have profound effects on the attitude of British ministers towards
Canada. The British were doing well exporting smaller cars such as the
Austin Mini to Canada. With the United Kingdom thought to be on the
verge of joining the European Common Market (precursor to today’s
European Union) and with the Dillon Round of tariff negotiations at the
GATT (named for then U.S. Undersecretary of Economic Affairs Doug-
las Dillon), a 10 per cent tariff would create serious problems between
Canada and the United Kingdom. The British might use such a tariff to
demand more concessions from Canada at the negotiations taking place
in Geneva.43
Ottawa balked at implementing the far-reaching Bladen proposals.
When he delivered his budget and tabled the Bladen report in June
1961, Fleming included only two of the commissioner’s more minor
recommendations relating to the excise tax and pricing. Rather than go
the whole hog with Bladen’s recommendations, the Tories went only
with those proposals that were easiest to enact. In his budget speech,
Fleming announced that additional study of Bladen’s more complex
recommendations would be required, and he called upon interested
parties to comment upon when, how, and if the tariff suggestions made
in the Bladen Report were to be implemented.44
Industry response to Fleming’s announcement varied. Days after the
budget speech, GM president Walker met again with Finance Depart-
ment officials. Walker made the case that he had been led to believe that
the Bladen recommendations supported his plan for automatic trans-
mission production in Canada. Furthermore, he intimated that Finance
officials had promised him a decision on his plan as soon as the Bladen
Commission’s findings were released. Walker suggested that without
an answer from the government within days, GM’s plans would be
irreparably harmed and that this would lead to massive layoffs at GM’s
Windsor and St Catharines (Ontario) transmission plants. However,
Walker also made clear that if GM were to be given some assurances,
namely, that GM would get duty-free treatment for certain machinery
and components, the company would go ahead with producing auto-
matic transmissions even if the extended content plan were not imple-
mented. With the prospect of more jobs and the production of automatic
transmissions, Finance officials felt that Ottawa could promise Walker
that the 25 per cent duty on transmissions would be reimposed. Such a
situation would not embarrass the government even if the Bladen plan
were implemented, since all products faced duties if companies did not
34 Auto Pact

meet content requirements. If the Bladen plan were not implemented,

however, the government could find itself in a compromising situation,
as GM would be seen to have been given preferential treatment. In that
case, Finance officials advised Fleming, Ottawa would have no choice
but to allow the duty on transmissions to lapse.45
Of the other Big Three manufacturers, Ford remained relatively muted
in its comments on Bladen’s proposals, although it congratulated the
government for removing the excise taxes and changing the sales taxes.
Chrysler, however, was enthusiastic about the extended content plan
and said that it hoped that the Canadian government would implement
it promptly. APMA’s D.S. Wood visited Ottawa to relay his association’s
views. Most parts makers, reported Wood, were apprehensive about
the loss of protection that the extended content plan would entail.46
Meanwhile, UAW officials on both sides of the Canada–U.S. border
said they were wary of any plan that did not provide adjustment
assistance to dislocated automotive workers.47
Fleming’s call for further examination of the practicality of the Bladen
recommendations brought little response from the automotive indus-
try. Only the APMA submitted an alternative plan. Wood, the activist
manager of the association, kept in close contact with government
officials following the budget speech, and by November 1961 produced
the APMA’s own detailed strategy for the auto industry. The APMA’s
plan reflected the more cautious approach of the parts makers, who
worried about being suddenly exposed to cut-throat U.S. competition
should Bladen’s extended content plan be implemented. Instead, the
APMA proposed a ‘derivation’ of the Bladen scheme, described by
Wood as an ‘export credit’ plan. Under the APMA’s proposed system,
auto companies would be able to deduct from the value of imported
goods on which they paid duty the dollar value of goods exported in a
given year, if they increased exports from Canada beyond the level of
the previous year’s exports. Non-manufacturing companies that im-
ported autos (such as European assembly operations) could deduct
duties based on the amount of Canadian content that such companies
exported in a given year. This would mean that foreign companies
could gain import credits if they increased their purchases of Canadian
parts and sent them to their home countries for inclusion in the cars
they would then send back to Canada. The idea was to ensure that both
automakers and parts makers gained the benefit of duty-free treatment
for increased exports. The plan would be operated through duty draw-
backs, wherein the government would ‘pay back’ the duty paid on
 The Canadian Auto Industry, 1900–1963 35

imported items if the manufacturer or company achieved the required

export targets. Wood argued that the plan also had the advantage of not
requiring a reopening of international trade obligations under the GATT,
as it could be initiated unilaterally.48
Finance Department officials were intrigued. When Wood visited
Ottawa in late 1961, he discussed the plan in detail with Wayne Plumptre,
Simon Reisman, Arthur Annis, and C.D. Arthur. The latter three would
form a significant contingent of Ottawa’s auto team in the years to
come. Reisman, who would before long have the leading role in shap-
ing Ottawa’s automotive policy, was typical of the group. When the
Second World War broke out he was studying economics at McGill
University, from which he received a Master’s degree in 1941. Reisman
served as a gunner during the war, and after that went to work for the
federal government. He was well established in the Finance Depart-
ment by 1958, when he was chosen to head a research project with
Irving Brecher on Canada–U.S. economic relations for Walter Gordon’s
Royal Commission on Canada’s Economic Prospects.49 In 1961 Reisman
was appointed assistant deputy minister of finance. Eventually, he
became deputy minister of industry and deputy minister of finance.50
Another Second World War veteran, Annis was appointed director of
economic affairs, industry tariffs, and trade tariffs in the Department
of Finance in 1960. Arthur had worked for Vincent Bladen during the
Royal Commission on the Automotive Industry before he went to the
Finance Department.
The other senior civil servants who had key roles in shaping policy
regarding Canada’s auto industry had similar backgrounds. D.A. (David)
Golden joined the civil service in 1945 following his discharge from the
army. Golden had survived four brutal years as a Japanese prisoner of
war after the fall of Hong Kong. Deputy minister of defence production
since 1954, Golden became the first deputy minister of the new Depart-
ment of Industry in 1963.51 J.H. (Jake) Warren was made deputy minis-
ter of trade and commerce in 1964. He, too, had served in the Second
World War and had joined the civil service shortly thereafter. By the
1960s, like Reisman and his other colleagues, Warren had accumulated
considerable experience as a trade negotiator.52
Finance officials were taken by the APMA’s plan. Plumptre thought
of it as ‘something less’ than the Bladen plan, yet he found it attractive
on the ground that it could be implemented without any changes to
Canada’s tariff structure. Moreover, the plan would assist parts manu-
facturers, who represented a substantial segment of the auto industry in
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*** START OF THE PROJECT GUTENBERG EBOOK ANDREAS

VESALIUS, THE REFORMER OF ANATOMY ***
 And. Vesalius

ANDREAS
VESALIUS
THE

Reformer of Anatomy

BY
JAMES MOORES BALL, M. D.

SAINT LOUIS
MEDICAL SCIENCE PRESS
MDCCCCX
 V
Copyrighted, 1910
By James Moores Ball
All rights reserved

VI
TO THE MEMORY
OF THOSE ILLUSTRIOUS MEN
WHO
OFTEN UNDER ADVERSE CIRCUMSTANCES
AND
SOMETIMES IN DANGER OF DEATH
SUCCEEDED IN UNRAVELLING THE MYSTERIES
OF THE STRUCTURE OF THE HUMAN BODY,
TO THE FATHERS OF ANATOMY
AND
TO THE ARTIST-ANATOMISTS
THIS BOOK
IS DEDICATED

VIII
 PREFACE

In the annals of the medical profession the name of Andreas

Vesalius of Brussels holds a place second to none. Every physician
has heard of him, yet few know the details of his life, the
circumstances under which his labors were carried out, the extent of
those labors, or their far-reaching influence upon the progress of
anatomy, physiology and surgery. Comparatively few physicians have
seen his works; and fewer still have read them. The reformation
which he inaugurated in anatomy, and incidentally in other branches
of medical science, has left only a dim impress upon the minds of
the busy, science-loving physicians of the nineteenth and twentieth
centuries. That so little should be known about him is not surprising,
since his writings were in Latin and were published prior to the
middle of the sixteenth century. His books, which at one time IX
were in the hands of all the scientific physicians of Europe, are
now rarely encountered beyond the walls of the great medical
libraries of the world. They are among the incunabula of the medical
literature. That English-speaking physicians know little of Vesalian
literature is due to the fact that no extensive biography of the great
anatomist has appeared in our language. Most of the Vesalian
literature which has been written by English and American authors
has been in the form of brief articles for the medical press; these
oftentimes have been incorrect and unillustrated. Perhaps the best
example of this class is the article by Mr. Henry Morley which
appeared originally in Fraser’s Magazine, in 1853, and later was
published in his Clement Marot and Other Studies, in 1871. The chief
data for Vesalius’s biography are to be found in his own writings, in
the archives of the Universities in which he taught, and in the
controversial literature of the period. Extensive as are these sources
they leave much to be desired. A vast mass of Vesalian literature
was printed, chiefly in the Latin language, during the seventeenth
and eighteenth centuries. Much of it is based on insufficient
evidence or on national prejudice. The Germans, the French, the
Dutch and the Italians have all taken a turn at it. In modern times
the monumental work of Roth, Andreas Vesalius Bruxellensis, Berlin,
1892, has served to epitomize this literature and to make clear many
points which formerly were not understood. I have taken Roth’s
book as a basis for this monograph, without using the voluminous
references which are found in the work of this thorough historian.

The man who overthrew the authority of Galen; revolutionized X

the teaching of the structure of the human body; started
anatomical, physiological, and surgical investigation in the right
channels; first correctly illustrated his dissections; destroyed ancient
dogmas, and made many new discoveries—this man, Andreas
Vesalius of Brussels, deserves the name which Morley has given him,
“the Luther of Anatomy.”

At long intervals a bright particular star appears in the intellectual

horizon, endowed with genius of such a superlative order as
seemingly to comprise within itself the whole domain of an entire
science. These men do not belong to any particular epoch in the
development of the human mind. They are the eternal symbols of
progress, and their history is the history of the science which they
profess. Such men were Bacon, Galileo, Descartes, Newton,
Lavoisier, and Bichat; and such also was Andreas Vesalius the
anatomist. Young, enthusiastic, courageous and diligent, Vesalius
dared to contradict the authority of Galen, corrected the anatomical
mistakes of thirteen centuries and before his thirtieth year published
the most accurate, complete, and best illustrated treatise on
anatomy that the world had ever seen. His industry, the success
which crowned his efforts, the jealousies which his discoveries
aroused in the breasts of his contemporaries, the honors which were
conferred upon him by Charles the Fifth and Philip the Second, his
pilgrimage to the Holy Land, and his tragic death—these are events
which deserve to be chronicled by an abler pen than mine.

The year 1543 marks the date of a revolution which was won, XI
not by force of arms but by the scalpel of an anatomist and
the hand of an artist. The whole of human anatomy, as a study
involving correct descriptions of the component parts of the body
and accurate delineations thereof, may be said to have been
founded by Andreas Vesalius and Jan Stephan van Calcar. As light
pouring into a prism attracts little notice until it emerges in iridescent
hues, so it was with anatomy: after passing through the brain of
Vesalius it bore rich fruit which has been gathered by many hands.
To turn from the writings of Galen, Mondino, Hundt, Peyligk,
Phryesen, and Berengario da Carpi to the beauties of Vesalius’s De
Humani Corporis Fabrica is like passing from darkness into sunlight.
To both anatomists and artists this book was a revelation. For more
than a century after its appearance the anatomists of Europe did
little more than make additions to, and compose commentaries upon
the conjoint triumph of Vesalius and van Calcar. For more than two
centuries the osteologic and myologic figures of the Fabrica formed
the basis of all treatises on Art-Anatomy.

JAMES MOORES BALL.

Saint Louis,
MDCCCCX.
XII
 TABLE OF CONTENTS
PAGE
INTRODUCTION 1-16
The Study of Medical History—The General Renaissance—The Anatomical
Renaissance.
ANATOMY IN ANCIENT TIMES 17-28
Anatomy in Egypt and in Greece—Hippocrates and the Asclepiadae—
Alcmaeon, Empedocles and Aristotle—Early Roman Medicine—The
Alexandrian University—Herophilus and Erasistratus—Claudius Galenus—
The School of Salernum—Frederick II.
MONDINO, THE RESTORER OF ANATOMY 29-36
Life of Mondino—He restores the Study of Practical Anatomy—His Book
on Anatomy.
MONDINO’S SUCCESSORS 37-51
Gabriel de Zerbi—John Peyligk—Magnus Hundt—Laurentius Phryesen—
Alexander Achillinus—Berengario da Carpi—John Dryander—Charles
Estienne.
VESALIUS’S EARLY LIFE 52-55
Origin of the Vesalius Family—Early Life of the Anatomist—Vesalius enters
the University of Louvain.
SOJOURN IN PARIS 56-69
Vesalius goes to Paris to study Medicine—Celebrated Parisian Physicians
of the Sixteenth Century—Jacobus Sylvius—Joannes Guinterius—Jean
Fernel—Philosophy of Pierre de la Rameé—State of Anatomy at this
Period.
VESALIUS RETURNS TO LOUVAIN 70-72
Vesalius returns to Louvain—He conducts a Course in Anatomy—Secures
a Skeleton.
PROFESSOR OF ANATOMY IN PADUA 73-80
Vesalius goes to Venice, thence to Padua—Receives the Degree of Doctor
of Medicine—He is appointed Professor of Anatomy—His method of
Teaching—Lectures also in Bologna.
FIRST CONTRIBUTION TO ANATOMY 81-83
 Vesalius issues a Series of Anatomical Plates under the title “Tabulae
Anatomicae”—His Plates are extensively pirated.
PUBLICATION OF THE FABRICA 84-94
The Manuscript and Illustrations for the Fabrica are transported to Basel
—Joannes Oporinus, the noted Printer and Greek Scholar—Publication of
the Fabrica—Beauty of the Illustrations—Who was the unnamed Artist?—
The Plates were erroneously ascribed to Titian—Christoforo Coriolano—
Jan Stephan van Calcar—Popularity of the Illustrations among Artists and
Anatomists.
PUBLICATION OF THE EPITOME 95-97
Publication of the Epitome—Reasons for its Publication—Character of the
Work.
CONTENTS OF THE FABRICA 99-113
General Plan of the Book—A brief Review of its Contents—The First Book,
on Osteology—Vesalius’s Contributions to the Anatomy of the Bones—The
Second Book, on Ligaments and Muscles—Excellence of this Part of the
“Fabrica”—The Third Book, on the Veins and Arteries—The Fourth Book,
on the Nerves—The Fifth Book, on the Organs of Nutrition—The Sixth
Book, on the Heart—Vesalius’s Idea of the Circulation—Quotation from his
Book—The Seventh Book, on the Brain and the Organs of Sense—
Conclusion.
CONTEMPORARY ANATOMISTS 114-125
The publication of the Fabrica is followed by great activity among
Anatomists—Bartholomeus Eustachius—Realdus Columbus—Gabriel
Fallopius—John Philip Ingrassias.
COMMENTATORS AND PLAGIARISTS 126-129
Plagiarism in Medicine—William Cowper and Bidloo’s Plates—Pirated
editions of the “Tabulae Anatomicae”—Thomas Geminus’s editions of the
“Fabrica”—The Microcosmographia of Helkiah Crooke—John Banister’s
Book—Juan Valverde di Hamusco’s work on Anatomy—Best editions of
the “Fabrica”.
THE COURT PHYSICIAN 130-132
Vesalius is appointed Archiatrus to Charles the Fifth—He follows the
Emperor in his Journeys—Abdication of Charles—Vesalius is appointed
Archiatrus to Philip the Second.
PILGRIMAGE AND DEATH 133-136
Vesalius leaves Madrid—He visits Venice, then goes to Cyprus, and passes
on to Jerusalem—Reason for the Pilgrimage—Death of Vesalius.
XV
 LIST OF ILLUSTRATIONS
Andreas Vesalius—from the “Epitome”, 1543 Frontispiece
PAGE
Andreas Vesalius—van Kalker p.; I. Troijen s.—from an old
copperplate engraving
XVIII.
Initial Letter—from the “Fabrica”, 1543 16
Hippocrates 17
Aristotle 19
Alexander the Great 20
Ptolemy Soter 21
Galen 24
Mondino’s Diagram of the Heart 31
Anatomical Demonstration in 1493 33
Title-page of Mondino’s Anatomy by Melerstat 34
Colophon of the Anatomy of Mondino 36
Anatomical Plate by Ricardus Hela, 1493 38
Peyligk’s Diagram of the Heart, 1499 39
Anatomical Figure from Magnus Hundt, 1501 40
Anatomical Figure from Laurentius Phryesen, 1518 41
Alexander Achillinus 42
Dissection by Berengario, 1535 43
Skeleton by Berengario, 1523 44
Muscles by Berengario, 1521 45
Muscles by Berengario, 1521 46
Dryander 47
Anatomical Figure by Estienne, 1545 48
Skeleton by Estienne, 1545 49
Skull by Dryander, 1541 51
The Old University of Louvain 54
Sylvius 57
Winter of Andernach 62
Jean Fernel 64
Ramus 66
Vivisection of a Pig—from the “Fabrica”, 1543 69
Instruments used in Dissection—from the “Fabrica”, 1543 74
Initial Letter—from the “Fabrica”, 1543 80
View of the City of Basel in the Sixteenth Century 83
Joannes Oporinus 85
Mark of Oporinus—from the “Fabrica”, 1543 86
Jan Stephan van Calcar—from Sandrart’s “Teutsche Academie”, 1685
88
Second Vesalian Plate of the Muscles—from the “Fabrica”, 1543 90
Ninth Vesalian Plate of the Muscles—from the “Fabrica”, 1543 92
A Human Skull resting on the Skull of a Dog—from the “Fabrica”,
1543
94
Title-page of Vesalius’s “Epitome”, 1543 96
Skeleton by Vesalius—from the “Fabrica”, 1543 98
Fifth Vesalian Plate of the Muscles—from the “Fabrica”, 1543 100
Deep Muscles of the Back by Vesalius—from the “Fabrica”, 1543 102
Part of the First Text-page of the “Fabrica”, 1543 103
Plate of the Arterial Tree by Vesalius—from the “Fabrica”, 1543 104
Dissection of the Abdomen by Vesalius—from the “Fabrica”, 1543 106
Dissection of the Heart by Vesalius—from the “Fabrica”, 1543 107
Initial Letter—from the “Fabrica”, 1543 113
Brain and Nerves by Eustachius 116
Muscles by Eustachius 117
Title-page of Columbus’s Anatomy 120
Gabriel Fallopius 122
Ingrassias 125
Charles the Fifth 131
Philip the Second 133
XVII
 I. van Kalker p. I. Troÿen s.
ANDREAS VESALIUS
(From an old copperplate engraving)

1
 INTRODUCTION

The intelligent student of medical history has at his command an

unfailing source of pleasure. To learn the successive steps by which
Medicine has advanced from a priest-ridden and secret art practiced
with mysterious rites in the Greek temples, passing through the
schools of Greek philosophy into the light of publicity, is his privilege.
To hunt through musty and worm-eaten volumes for facts regarding
the great physicians of antiquity is his delight; and to communicate
the knowledge thus obtained to others, who have not the time or
the facilities for such research, is his duty. In every period are events
and incidents of interest, but to the Middle Ages a peculiar
fascination attaches; for it was during this period that Europe,
emerging from an intellectual darkness of ten centuries’ duration,
awoke to the Renaissance, and Medicine, as ever has been the case,
kept pace with the general advance of knowledge.

The present book deals with the life of a master whose work was an
essential factor in the evolution of the Anatomical Renaissance. In
order to understand the New Birth of Anatomy it is necessary to
know something of the scope and influence of the General
Renaissance.
 2

The General Renaissance

This, the Revival of Learning, includes an indefinite time in European
history. The seeds of the new movement were planted in the Middle
Ages, but they bore no fruit until the time had arrived for an
apparently “spontaneous outburst of intelligence”. Definitions of the
Renaissance will vary with the point of view. Artists and sculptors will
say it was a revolution which was created by the recovery of ancient
statues; littérateurs and philosophers look upon it as a radical
change due to the discovery of the writings of the classical authors;
astronomers and physicists will cite the names of Copernicus,
Galileo, and Torricelli; geographers will point to the discovery of a
New Continent; historians will name the extinction of feudalism and
the capture of Constantinople by the Turks; inventors will recall the
changed conditions of warfare brought about by gunpowder, the
multiplication of books by the invention of printing, and the advent
of new methods of engraving; and anatomists will sound the praises
of Leonardo da Vinci and of Andreas Vesalius. All will agree that the
Renaissance meant Revolution—revolution in thought, in conduct, in
creed, and in conditions of existence. To no one fact can the
Renaissance be attributed; nor can its scope be limited to any one
field of human endeavor. The Renaissance was, and is, and will
continue to be, as long as the race progresses.

The new movement began in Italy and grew rapidly. When, toward
the end of the sixteenth century, the lamp of learning began to get
dim in Italy, it was relighted by the nations of northern Europe 3
—the Germans, the Hollanders, and the English—and by them
was transferred to us. The Revival consisted largely in the recovery
of the buried writings of the ancient Greek and Roman authors,
together with comments on what they had written, and the
production of books which were modeled after their works. But it
was broader than this. It included all branches of learning, although
more progress was made in some lines than in others.
Italy, a country divided into numerous small States, and so-called
Republics, offered great opportunities for individual development and
became famous in those paths in which individualism has gained its
greatest triumphs. Thus in literature, in law, in medicine, in painting
and in sculpture, the Italians were preëminent. In architecture and
in the drama they reached no such heights as were attained by the
French, the Germans and the English. It was in the northwest part of
Italy, in the province of Tuscany, that the Renaissance gained its
greatest victories. Among the earliest of the leaders of the New
Learning was the Florentine poet, Dante Alighieri (1265-1321). “To
Dante”, says Symonds, “in a truer sense than to any other poet,
belongs the double glory of immortalising in verse the centuries
behind him, while he inaugurated the new age”. His Vita Nuova
(New Life) and Divina Commedia (Divine Comedy) are essentially
modern in thought, but ancient in the manner in which the thought
is expressed.

Petrarch may be said to fairly open the new era. Like Dante, he was
a Florentine. He was the apostle of Humanism, that system of 4
philosophy which regarded man “as a rational being apart from
theological determinations” and perceived that “classic literature
alone displayed human nature in the plenitude of intellectual and
moral freedom”. To a revolt against the despotism of the Church, it
added the attempt to unify all that had been taught and done by
man. Petrarch was a poet, a lawyer, an orator, a priest, and a
philosopher. He lived between the years 1304-1374. He was a great
traveler, and visited the leading continental cities in order to
converse with learned men. Petrarch delighted in the study of
Cicero, in collecting manuscripts, and in accumulating coins and
inscriptions for historic purposes. He advocated public libraries and
preached the duty of preserving ancient monuments. He opposed
the physicians and astrologers of his day, and ridiculed the followers
of Averröes.

Boccaccio, who has been called the Father of Italian Prose, and is
most widely known as the author of the Decameron, did not spend
all of his time in describing the escapades of the knights and ladies
of old. Influenced potently by Petrarch, Boccaccio regretted the
years he had wasted in law and trade, when he should have been
reading the classics. Late in life he began the study of Greek that he
might read the Iliad and the Odyssey. What he lacked in genuine
scholarship he made up in industry. He continued the work begun by
Petrarch of hunting for lost manuscripts of the ancient Greek and
Roman authors. Many of these precious documents were stored in
the conventual libraries, where, too often, they were either 5
wantonly destroyed or were mutilated, the words of the author
being erased from the parchment to make way for new prayers.
Boccaccio tells of a visit which he made to the Benedictine
Monastery of Monte Cassino near the city of Salernum. He wished to
see the books and found them in a room without door or key. Many
of them were mutilated. On making inquiry as to the cause, the
monks answered that they had sold some of the sheets, having first
erased the original words, replacing them with psalters. The margins
of the old pages were made into charms and were sold to women.

It was owing to the unselfish labors of such men as Petrarch and

Boccaccio that the works of Livy, Cicero, Quintilian, Terence, and
others of the ancient authors, were preserved. In this enterprise
they were encouraged by the rulers. Thus Cosimo de’ Medici in
Florence, Alfonso the Magnanimous in Naples, and Nicholas V. in
Rome, to say nothing of the despots of the smaller cities, rivaled one
another in their zeal in unearthing and multiplying the manuscripts
of the ancient writers. They spared neither time nor money to
increase their store of manuscript books. They surrounded
themselves with learned men who lived in high esteem, and who
were supported by salaries paid by the State or by private pensions.

The fifteenth century, which was one of the most remarkable epochs
in history, was rich in accomplishment. Almost all of the great events
which have influenced European commercial and intellectual
development can be traced to that period. The invention of printing,
the discovery of America, the fall of the Roman Empire in the East,
the birth of the Reformation, and the rise of art in Italy, all 6
belong to this wonderful century. In this period, when almost
every city in Italy was a new Athens, the Italian poets, historians,
and artists vied with the eminent men of the ancient world in
carrying the lamp of learning. The Italian cities—Florence, Bologna,
Milan, Venice, Rome and Ferrara—fought with one another, not for
the spoils of the battlefield but for the victories of science and of art;
not so much for the profits of commerce as for the wealth of genius
and of learning. The intellectual development which occurred in
northern Italy under the rule of the house of Medici, and particularly
under the auspices of Lorenzo the Magnificent, forms one of the
most interesting periods in European history.

It is impossible in the present work to trace the steps by which the

exquisite taste of the ancients in works of art was revived in modern
times. Nevertheless, a few words may be devoted to this subject.
While much must be credited to those Greek artists who had left
their country and had settled in the Italian peninsula, it must be
conceded that many of the works of art of the native Italians were
not the less meritorious. The same circumstances which favored the
revival of letters, operated to further the cause of art; and the same
individuals, who were interested in the preservation of the
manuscripts of the older authors, also busied themselves with the
collection of ancient statues, paintings, gems and tapestry. The
freedom of the Italian Republics permitted the minds of men to
expand to full fruition; and the encouragement which was given 7
by its rulers to artists, sculptors and artisans, made the city of
Florence, in the fifteenth century, a not less renowned centre of
culture than Athens had been in ancient times.

The revival of art dates from the time of Cimabue (1240-1300) and
Giotto (1276-1336). The former is known as the Father of Modern
Painters; the latter constructed the Campanile at Florence. To
Giovanni Cimabue, scion of a noble Florentine family, is usually given
the credit of being the restorer of art in Italy. He is thought to have
been the first painter to throw expression into the human
countenance. His work, if judged by present standards, would be
called crude, rude and incomplete. Much of the fame of this painter
is to be attributed to his being the first person whom Vasari
chronicled in his Lives of the Painters. For more than a century after
the time of Cimabue and Giotto, painters displayed only a smattering
of anatomical knowledge.

Early in the fifteenth century two Flemish artists, Hubert van Eyck
(1365-1426) and his brother John (1385-1441), in their polyptych of
the Adoration of the Lamb, boldly struck out along new lines and
committed the unheard-of deed of painting nude figures. Italy,
however, was the real birthplace of Art-Anatomy. While the Flemings
and others of the North painted everything that they saw, including
the nude, the Italians were the first men of the Renaissance who
thought of painting the nude figure before draping it. Leo Battista
Alberti (1404-1472), in his works on painting, insists that the bony
skeleton must first be drawn and then clothed with its muscles 8
and flesh. This was an important step in advance, since it
shows that the Florentine artists were progressing towards realism
and were breaking away from the symbolism of the early Christian
painters and mosaic-workers. The new movement in art found a
worthy champion in Antonio Pollaiuolo (1432-1498). In his
knowledge of the anatomy of the human figure he surpassed all of
the artists of his day; and as a result of his labors he may justly be
named the founder of the scientific study of the nude. His
knowledge of anatomy was so accurate, and so extensive, that it
could have been gained only in the dissecting room.

Under the patronage of Lorenzo de’ Medici and the guiding mind of
Pollaiuolo, there occurred a revival of pseudo-paganism in Art. The
old Church subjects were largely neglected; mythological subjects
again became the fashion; draperies were either modified or were
laid aside; and the scientific study of anatomy, both as regards the
nude figure and the dissection of the individual parts, became the
necessary training of the student. Of all the masters of this period,
the palm for excellence in drawing the naked figure must be
awarded to Luca Signorelli (1442-1524), from whose work Michael
Angelo is known to have profited.

The alliance between skilled anatomists and master artists was of

reciprocal benefit. The anatomical studies which were made
conjointly by Leonardo da Vinci and the celebrated teacher of
anatomy, Marc Antonio della Torre, were lost to the world by the
untimely death of the latter, before he had finished a magnificent
treatise on human anatomy. Leonardo’s anatomical sketches, if 9
they had been published during his lifetime, would have
revolutionized anatomy both as regards discoveries in the body and
the teaching of the structure of man. These masterpieces of
anatomical illustration long remained hidden from the world; they
were published only in the year 1902. Even now their cost is so
great that only a few wealthy libraries can possess them. Leonardo’s
long unpublished drawings show him to have been a most accurate
anatomist. At the same time, he constantly kept in view the aim of
fine art, which, in so far as practical anatomy is concerned, needs a
knowledge of only the bones and the muscles.

Nor was Leonardo the only artist who made dissections. Raffaello
Santi, Michael Angelo, Bartholomaus Torre, Luigi Cardi or Civoli, Jan
Stephan van Calcar, Giuseppe Ribera, Arnold Myntens, and Pietro da
[1]
Cortona studied practical anatomy. Rubens’s long-lost sketch-book ,
which was published one hundred and thirty-three years after his
death, shows with what care he had studied human anatomy.
Albrecht Dürer’s Treatise on the Proportions of the Human Body is
also worthy of mention.

In the number and fame of her Universities, Italy showed

supremacy. At the end of the fifteenth century she could boast of
sixteen seats of learning, a number equal to that of the combined
institutions of Britain, France, Germany, Hungary, Bohemia and
Bavaria.
This digression has led us away from the Humanists. Their list is a
long one. Among them were Poggio Bracciolini, who 10
discovered the manuscript of the Institutions of Quintilian and
the writings of Vitruvius; Poliziano, the first poet of the fifteenth
century, and the translator of the works of Hippocrates and Galen;
Pontanus, whose De Stellis and Urania were much admired by Italian
scholars; Sannazzaro, whose epic on the birth of Christ cost him
twenty years of labor; Vida, whose Christiad and other poems were
much admired; and Fracastoro, whose Syphilis was hailed as a divine
poem.

From the viewpoint of the medical historian an important event

occurred in the year 1443, when Thomas of Sarzana, later known as
Pope Nicholas V., discovered a manuscript copy of the De Medicina
of Aulus Cornelius Celsus. This classic, which had been lost for many
centuries, was one of the first medical books to pass through the
press. It gave physicians an insight into Hippocratic medicine without
the disadvantage of an imperfect translation. Physicians took an
active part in the Renaissance. Thus Nicholas Leonicenus, of Ferrara,
translated the Aphorisms of Hippocrates and the Natural History of
Pliny; and Winter of Andernach did similar labor for the writings of
Galen, Alexander, and Paulus Aegineta. Their efforts seem
insignificant in comparison with those of Anutius Foesius, a humble
practitioner of Metz, who spent forty years of his life in preparing a
complete Greek edition of the works of Hippocrates. The New
Learning was brought to England by two physicians, Thomas Linacre
and John Kaye (Caius).

Some of the Humanists were printers. The history of printing in Italy

naturally forms a part of the history of the Renaissance. In 11
1462, Maintz was pillaged by Adolph of Nassau and its printers
were scattered over Europe. Two of them wandered into Italy, living
in a village in the Sabine mountains, where, in October, 1465, the
first book was printed from an Italian press. It was a Latin edition of
Lactantius. Six years later a press was established in Florence. In
1478, Mondino’s Anathomia was printed in Pavia. It has been
estimated that before the first year of the sixteenth century, five
thousand books had been printed in Italy. In those days the editions
were small, 265 copies being considered one edition. An immense
amount of labor was required to get out a new edition. First, the
manuscripts of the ancient author had to be collected, compared
and corrected, this work being done by learned men who resided in
the home of the publisher. The corrections were made without the
aid of dictionaries, grammars, or book-helps of any kind. The proof
was read aloud to the assembled scholars and the final corrections
were added. In time, Venice came to be the most noted of the
Italian cities in the publishing business, owing chiefly to the family of
Aldo. This family of printers became famous for finely printed Greek
and Latin books, which are still called Aldine editions. Nine years
after the printing of the first book in Italy, the art was practiced in
England by Caxton.

Humanism in Italy began to decline toward the close of the fifteenth

century. Long before this time it had degenerated into Paganism.
The scholars influenced all life, customs and thought. Although the
nation remained Catholic, it was such only in name. Everyone 12
bowed before the shrine of classical literature. Even in the
christening of children the Christian name was sacrificed to
paganism. The saints were forgotten, and the names most
frequently chosen were those from heathen mythology. The polite
authors described scenes, events and actions in their writings in
terms which long since have been banished from good society. A
spade was called by its true name. Bembo, the secretary of Leo X.,
could write a hymn to Saint Stephen or a monologue for Priapus
with equal ease and elegance. The amours of the high and the low
were flaunted in print. The nation degenerated into an intellectual
and sensual state which involved even the Popes. Scholars and rich
men alike vied with one another in returning to those pursuits,
habits, and methods of thought which had ruled ancient Rome in her
most corrupt days.
Such a condition could not exist forever. The turning-point came in
1527, when Charles the Fifth, engaging in war with Pope Clement
VII., captured and sacked the city of Rome. After that event
everything was changed. Not only had the scholars lost their
influence, but many of them had lost their lives. Valeriano, who
returned to Rome after the siege, pathetically exclaims: “Good God!
when first I began to enquire for the philosophers, orators, poets
and professors of Greek and Latin literature, whose names were
written on my tablets, how great, how horrible a tragedy was offered
to me! Of all those lettered men whom I had hoped to see, how
many had perished miserably, carried off by the most cruel of all
fates, overwhelmed by undeserved calamities; some dead of plague,
some brought to a slow end by penury in exile, others 13
slaughtered by a foeman’s sword, others worn out by daily
tortures; some, again, and these of all the most unhappy, driven by
anguish to self-murder”. Such was the end of the men who made the
Italian Renaissance. The Spaniards, the Inquisition, and the changed
policy of the Church prevented a second revival of Humanism.

While the sack of Rome marks the end of the Humanists, the Revival
in Medicine continued to grow in vigor and extent. Many of the
greatest discoveries in anatomy were made, and most of the
important books on this subject were written, in the middle and
latter part of the sixteenth century. Italian history is rich in
contradictions. While peace, ease and comfort are generally
considered to be necessary to the development of science and
culture, Italy offers the strange spectacle of the steady increase in
medical knowledge in spite of wars and alarms. The Inquisition,
which had been introduced from Spain in 1224, was given a new
and horrible impetus when, in 1540, Paul III. appointed six cardinals
to add to its tortures. One of them, Caraffa, became Pope Paul IV. in
1555, and four years later originated the Index Expurgatorius. Torn
by civil and foreign wars, and terrorized by the Inquisition, which
was not abolished until late in the eighteenth century, Italy gradually
lost her commercial and intellectual supremacy. That she should
have accomplished so much under such unfavorable circumstances,
is now a matter of wonderment.

The origin of the Renaissance in Italy was due to many causes. The
early Roman civilization was not entirely blotted out by the 14
invasion of the barbarians of the North. And in the matter of
language the Italians possessed an advantage, since the transition
from Latin to Italian was easier than from Latin to Spanish, French,
English or German. The fertility of the country; the mildness of the
climate; the division into semi-independent states; the infusion of
new northern blood into the veins of the Italians; the removal of the
papal court to Avignon in 1309; and the gradual rise of a powerful
middle class, whose members included the devotees of the
professions of law and medicine, were factors which determined that
Italy, rather than France or Spain, should be the field for the Revival
of Letters.

To Italy, then, belongs the glory of having been the first to free
herself from the trammels of ancient scholasticism and the fetters of
mediaeval theology. She abandoned the wordy dialectics and
metaphysical gymnastics of the philosophers of old. In place of
mortification, penance and solitary confinement in cloistered
monasteries and convents, she began to have a proper conception
of the dignity of man and his relation to nature.

Italy, in the time of her freedom, received the torch of learning from
Greece; Italy revived its brilliancy, and, when her time of adversity
and ruin arrived, she passed it on to the nations of Northern Europe.
They in turn have transferred it to America, to Australia, to India,
and to the uttermost parts of the earth.

The Anatomical Renaissance

Italy in the sixteenth century was the fount from which issued a
ceaseless stream of anatomical discoveries. The ancient and 15
illustrious Universities of Bologna, Pavia, Padua, Pisa and
Rome, eclipsed the schools of Paris and Montpellier, of Toulouse and
Salamanca; and the Italian peninsula, which, in early mediaeval
times, had gloried in the skill of the physicians of Salernum, a
second time became the medical centre of Europe. Vesalius and his
pupil, Fallopius, taught at Padua; the ancient fame of Bologna was
supported by Arantius and Varolius; Vidius, returned from
establishing the anatomical school at Paris, taught at Pisa;
Eustachius was at Rome, Ingrassias lectured at Naples, and the fame
of the New Anatomy spread throughout the world. The Italian cities
were filled with students from foreign lands. Padua had more than
one thousand new students every year, salaries were paid to her one
hundred professors, and medicine was looked upon as a noble
profession.

While the Italians were the leaders in progress, the Germans were
still lecturing on Galen and Avicenna, the English had done almost
nothing, and the Collége de France was not established until 1530.

Legalized by imperial authority and sanctioned by the Church,

dissection was no longer regarded as a crime. A bull by Pope
Boniface VIII., issued in the year 1300, forbidding the evisceration of
the dead and the boiling of their bodies to secure the bones for
consecrated ground, as was done by the Crusaders, was wrongly
interpreted as forbidding anatomical dissection. Two centuries later
the Popes, standing in the vanguard of science, permitted
dissections to be made in all the Italian medical schools, and paved
the way for the Anatomical Renaissance.

Great things were done in the sixteenth century. Under the 16

scalpel and pen of Vesalius, anatomy was revolutionized.
Surgery was guided into new paths by Ambroise Paré; and
obstetrics, thanks to the labors of Eucharius Rhodion and Jacques
Guillemeau, began to assume its legitimate place among the medical
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