Caught in the Middle

America wants a closer trading relationship with Britain. To achieve this it needs Canada’s help. What role will Canada play in this coming Anglo-Saxon combine? In this article, we take a look at the rich history of this nation throughout the past century and show why Canada finds itself in such a precarious position right now.
From the March 2000 Trumpet Print Edition

On December 25, 1913, Herbert W. Armstrong walked across the International Bridge into Canada’s picturesque Niagara Falls. “There had been a silver thaw, then a refreeze,” he wrote in his autobiography. “All the trees glistened in the bright sun like millions of brilliantly sparkling diamonds.” This was a peaceful time.

Six months later, on June 28, 1914, the 19-year old student Gavrilo Princip, an agent of the Serbian Black Hand secret society, assassinated Archduke Franz Ferdinand, heir to the Austro-Hungarian throne. With unparalleled speed Europe spun out of control, and by August World War I had begun.

Canadian troops marched to war alongside Britain and its other Commonwealth allies. Canadians saw a generation of 60,611 lives erased, their blood soaking the war-torn battlefields of Europe.

Four years later, the war was over and the Treaty of Versailles was signed, ushering in 20 years respite from world war. In 1929 the Great Depression struck, and its repercussions were felt worldwide. At the same time, Europe was again simmering with discontent. In Germany, the depression created an atmosphere ripe for the rise of a demigod. Surveying the scene, Adolf Hitler seized the initiative. The German nation followed him; the Nazi Party was spawned.

In 1939, the führer arrogantly marched his storm-troopers into the quiet countryside of Poland, and World War II was underway. Canadian troops suffered heavy losses in the Allies’ titanic battle to beat back the Nazi war machine. In the midst of the war, Canada was spending $12 million per day on the war effort. After Japanese bombs rained down on Pearl Harbor, Canada again answered the call of duty in support of the U.S.-led war effort to set Japan’s rising sun.

In 1945, at war’s end, Germany and much of Europe lay in rubble. Canada had again done its part in the fight for the cause of freedom, sacrificing 45,000 lives. Its troops came home from the dark war to a calming sanctuary. Lush wheat fields, forests, snow-capped peaks, tranquil lakes and rivers all moved British Field-Marshal Lord Montgomery; during a post-war visit to Canada, he called it “the great and wonderful country.”

By now the voice of Herbert Armstrong was becoming familiar to Canadians. He was broadcasting via radio, warning that Germany would again rise from ashes to lead a super economic, political and military union. As Europeans cleared the rubble of war, he warned that America, Britain and the Commonwealth nations would fade in power and influence under the ominous shadow of this European superstate.

He warned that Britain and America would become isolationist in their international trade and military deployment.

And all along he warned that Canada would be caught in the middle.

Shifting Trade Winds

After World War II, Canada entered boom years. It was temporarily the world’s third most important country. With European and Japanese industry devastated, Canada’s ample reserves of wheat and minerals, especially the strategic reserves of oil, iron ore, uranium, aluminum and hydro-electricity, powered Canada to a peak of world influence that was exceeded only by the United States and Soviet Russia.

The value of Canadian wheat exports doubled, making Canada the post-war breadbasket for the world. Mineral production jumped nearly fourfold. Manufacturing output tripled. Imperial Oils’ discovery of a new well at Leduc, Alberta, in 1947 kept pace with one of the world’s largest iron-ore finds near the Quebec-Labrador border in 1948.

Ontario hummed with news of rich uranium strikes in its ancient treasure chest, the Canadian Shield, while Kitimat, British Colombia, was host to one of the world’s largest hydroelectric plants for the aluminum industry. It commanded over 90 percent of the world’s nickel supply.

Even the mild post-Korean War recession of 1953-54 couldn’t halt the headlong rush of the Canadian economy.

By 1957, six of the war-ravaged nations of Western Europe were rebuilt with help from the U.S.-led Marshall Plan and formed the European Economic Community. Skyrocketing Volkswagen sales in North America signaled a new economic era. Canada’s global market began shrinking quickly. Aggressive multinational corporations vied for a larger slice of the global trade pie.

In 1958, a full-scale recession ravaged Canada. What was happening to “the great and wonderful country”?

Part of Canada’s problems lay in the cycle of its free-enterprise system. Its remarkable growth from the end of World War II to the 1950s concealed its basic structural flaws. Its natural-resource boom pushed both men and equipment into the far north. Canada’s harsh winters made the extraction of resources and their processing an expensive venture. In addition, the country had developed a deep dependency upon foreign capital. The cold winds of change were starting to blow across Canada’s economic landscape.

Events were proving Mr. Armstrong right! In his book The United States and Britain in Prophecy, he warned Canada that a foreign power would “strip entirely from them this colossal, unprecedented national blessing.”

With a small domestic market, Canada became vitally dependent upon foreign trade—especially trade with its number-one client, the United States.

Sleeping With the Elephant

As Canada entered the ’60s, various domestic concerns emerged. The reality of the economic outlook was sinking in. The Canadian economy was now at the mercy of American policy.

During 1962, in an effort to spark the U.S.’s northern neighbor into action, President John F. Kennedy warned Canada to “trade or fade.”

After 20 years of general prosperity, a “bigger and better” mentality had set the stage for the harrowing inflation battles of the 1970s. Writing in the March 1971 edition of the Plain Truth magazine, Herbert Armstrong warned that these events “could affect not only every person in the United States and Canada, but all the peoples of the world.” Canada expected more from the marketplace; instead it got less.

Relations between Canada and America began to chill as Prime Minister Pierre Trudeau’s “War on Inflation” was undermined by President Nixon’s radical economic reforms, which included the closing of the gold window and two separate devaluations of the U.S. dollar.

Voicing his frustration in a December 1971 state visit to Washington, Trudeau said, “Living next to you is in some ways like sleeping with an elephant. No matter how friendly and even-tempered is the beast, one is affected by every twitch and grunt.”

Farm crises erupted across the nation, while resource wars broke out between Ottawa and energy-producing provinces in the west. Canadian wheat prices plummeted to levels lower than in 1949.

The Organization of Petroleum Exporting Countries’ (opec) oil embargo of 1973-74, a result of the short Arab-Israeli war, exposed Canada’s hidden economic weaknesses to the full gales. Its problems were rooted in geography, culture, politics and resources, and were inexorably intertwined with the structure of the Canadian nation.

The war on inflation continued, but at a heavy price. The defense budget was slashed. Canada’s once proud armed forces, that had helped fend off German and Japanese hegemony, now ranked on a par with those of Ecuador and the Philippines.

The 1980s came and Canada, following the U.S. lead, rode the wave of “fantastic plastic” and ballooned its credit spending. This economic idiocy threw the “great and wonderful country” into a raging sea of debt which successive governments were not able to control.

Herbert Armstrong issued an advance warning to Canada as it entered “the decade of debt”: “Our governments have been corrupt. Our business, industrial, economic and commercial systems have been shot through with deception, dishonesty, selfishness.

“I warn you, prepare greatly to reduce your standard of living!” (Plain Truth, Jan. 1980). Did Canada listen?

The Trumpet magazine heard Mr. Armstrong’s warning. Fifteen years later, in December 1995, the Trumpet warned again, “Canada is facing a significant reduction in its standard of living if it cannot get its debt under control.”

By now, citizens of the maple leaf nation were preoccupied with Quebec’s aspirations of succession. In 1995, the French-dominated province, which has for so long been Canada’s thorn in the flesh, voted by a wafer-thin majority to remain part of Canada. Prime Minister Jean Chretien, himself a Quebecois, had not expected so close a result and knew that Canada was destined for continued years of domestic discontent.

Canada didn’t listen to Herbert Armstrong or the warning from the Trumpet.

Now, at the dawn of the new millennium, Canada is bloated by debt. It boasts the second-largest per-capita debt of the Group of Eight industrialized nations (G8). That’s more per-capita national debt than Germany, France, Britain, Japan or the United States. This country has fallen greatly from its days of prosperity. Canada is in crisis!

NAFTA to the Rescue?

The search for a solution began on December 17, 1992, when Canada, Mexico and the U.S. signed the North American Free Trade Agreement (nafta).

Implementation of nafta didn’t begin till January 1, 1994. The agreement removed most barriers to trade and investment among the United States, Canada and Mexico. In addition, many trade tariffs were eliminated immediately, with others being phased out over a period of a few years.

One problem, however, was that nafta excluded the growing market of Latin America. Expansionists on Capitol Hill pushed to see nafta enlarged into a Free Trade Area of the Americas (ftaa). When Congress shot down this “fast track” legislation, it heralded a new era of American isolationism. With only 26 percent of the nation actually in support of nafta, the free-trade alliance was entering rough waters.

Although U.S. exports to nafta partners Mexico and Canada have

increased, so too have imports. This has resulted in a net loss of over 440,000 American jobs, according to the American Economic Policy Institute. Nafta managed to transform the U.S.’ $1.7 billion trade surplus with Mexico in 1993 into a $14.7 billion deficit for 1998. In addition, many major U.S. corporations have already developed manufacturing facilities in Mexico and Canada.

The U.S. appears to be losing out on the benefits of nafta, and despite some short-term gains, it has not provided the rescue package for Canada’s choking national debt.

Wolves in Sheep’s Clothing

The principal aim of U.S. efforts is to exclude its imperialist rivals, especially the Europeans. The European Union, of course, has its own free trade bloc, whose aim is to limit the U.S. in its global economic supremacy.

At a time when the European Union is snapping up prime real estate on all corners of the global market, America and Canada are looking inward, isolating themselves from the shocking reality of unfolding events.

With their total confidence in the success of nafta, the U.S. has missed the boat in Latin America, beaten to the punch by the salivating Europeans.

Signing on with both nafta and the EU, Mexico has positioned itself to play both sides, enjoying the best of both worlds by tapping the honey pot of these two Atlantic trade giants.

As we reported in our last edition of the Trumpet, long ago Germany planned to lead a European economic assault on Latin America. Like wolves in sheep’s clothing, the Europeans are moving in. In their boldest move yet, under the nose of nafta, the European Commission finalized historic free trade agreements with both Mexico and the Latin American Common Market (Mercosur). As these agreements take effect, watch for U.S. and Canadian political, economic and military influence beneath the Rio Grande to quickly evaporate.

Anthony Gooch, spokesman for European Trade Commissioner Pascal Lamy, recently commented that the EU’s agreements with Mexico and Latin America are the most “ambitious free trade agreements we have ever negotiated. We’ve caught up pretty well with the U.S.”

Last month, the Trumpet warned of a coming rift between the U.S., Canada and the EU: “The European Union, as it realizes the magnitude of its newfound economic importance…is strengthening its political voice, no longer willing to play second fiddle to the American giant…. America’s political voice is getting weaker, the EU’s voice is getting stronger, and the gulf between them is widening!”

In a massive show of Teutonic solidarity, Volkswagen earmarked over one third of its international exports for the next five years to be channeled into Mexico. Deals like this will continue to leave U.S. and Canadian auto manufacturers out in the cold and weaken the overall effectiveness of nafta.

These heightened movements in EU international trade do not appear to be raising many eyebrows in the U.S. and Canada, although one European politician, Andre Lepper of Poland, recognized the grave historical implications: “I often say that what Hitler failed to do by murdering millions is today being achieved by economic means” (New York Times, Sept. 30, 1999).

In 1996 the EU-Canada Action Plan was signed in Ottawa. For the most part, the action plan is simply a public-relations agreement. Currently, the reality is that Canada’s trade with the U.S. dwarfs EU influence. U.S. exports to Canada totalled $122 billion in the first nine months of last year. Many in Canada (particularly Quebecois) would like to see closer ties with the EU but realize the sizable commitment Canada has to nafta and the heavy pressure exerted by America.

Anglo-Saxon Combine

As the curtain came down on the 19th century, German Chancellor Otto von Bismark commented that the most important factor to recognize about the coming century was that the Americans spoke English. He saw that an alliance among the English-speaking nations (including Canada) would assemble the world’s most powerful union. The British Empire then emerged, and the U.S. became a global superpower.

Today, Britain has lost nearly all its possessions. The U.S. boasts a national debt in the trillions, lacks the will to use its power and leads the world in moral depravity. Britain and America have lost the pride of their power (Lev. 26:19).

Looking through the lens of prophecy in advance of this collapse, Herbert Armstrong sternly warned, “You need to open your eyes to the fact that Britain’s sun already has set! You need to wake up to the fact that the United States, even still possessing unmatched power, is afraid—fears—to use it.

“The United States is fast riding to the greatest fall that ever befell any nation! The handwriting is on the wall!” (The United States and Britain in Prophecy).

So where does this leave Canada?

Stuck as the midget tethered to the giant, its future is tied directly to that of the U.S. and Britain. A U.S. government study is now underway to determine whether Britain should be invited to join the nafta alliance.

An economic combine incorporating the U.S., Britain and Canada would bring together the three English-speaking members of the world’s top eight industrialized nations.

The study by the International Trade Commission (itc), whose mandate is to evaluate trade issues for Congress and the White House, will look at barriers to trade between the nafta countries and Britain. The itc has promised to hold a hearing on its findings on April 11 this year.

The proposal, which has been engineered by powerful U.S. senators, has attracted the support of prominent Canadians, including Preston Manning, leader of the Reform Party, and media mogul Conrad Black.

“I have long believed that both the United States and Great Britain would benefit from freer trade between our two countries,” said U.S. Republican Senator Phil Gramm. “We already have strong financial and historic ties. Now it’s time to further our relationship.”

The idea of hitching Britain to the U.S. was given serious thought during the 1960s, but each side elected to turn inward rather than reach out to the other. Forty years later, Britain may have no other choice than to “go nafta.”

In the September/October 1998 Trumpet, we reported that British trade relations were more tied to the United States than to Europe. We warned that Britain might indeed be forced to sever ties with Europe and enter nafta. And again, in our August 1999 issue, we told where events were headed: “The financial capital of Europe is rapidly shifting from London to Frankfurt. Bible prophecy indicates that Britain will ultimately not be a part of the European Union. The British public reject the switch from pounds to euros, and as Britain (biblical Ephraim) is invited to turn to brother America (Manasseh) for trading solace, both countries may well fall into a unique isolation.”

Roger Helmer, British Conservative Party member of the European Parliament, is an ardent supporter of the UK-nafta idea. “We Brits have come to terms with the fact that we no longer have an empire,” he said.

“Charles de Gaulle said that if Britain were forced to choose between the continent [Europe] and the sea, it would choose the sea. I hope that he was right” (International Herald Tribune, Jan. 19).

With growing discontent at home, the majority of Britons are not eager to jump into all aspects of European unity. Republican senators with close ties to British conservatives have proven that their intent is to help the Tories develop a more credible get-tough-on-Europe platform with which to battle Tony Blair’s pro-European Labor Party. Even former British Prime Minister Margaret Thatcher has lent her support to the Tories’ anti-EU platform. Watch for the Tories to offer the British public the attractive alternative of hitching itself to nafta.

Britain currently conducts about $85 billion in trade each year with the U.S. Its trade with Canada and Mexico accounts for $5 billion more.

Britain is Canada’s third-largest export market after the U.S. and Japan. It accounts for over two thirds of the total European investment in America. The U.S. is Britain’s largest single export market, with combined annual exports of goods and services worth more than 31 billion pounds.

Last year, Britons rejected the Blair government’s desire to give up their beloved pound sterling for the new euro currency, and now over 70 percent of Britons are reportedly uncomfortable with Labor’s euro overtures.

Herbert Armstrong saw the grim reality facing Britain. “Germany is the economic and military heart of Europe,” he wrote in 1955. “Probably Germany will lead and dominate the coming United States of Europe. But Britain will be no part of it!” (ibid.).

Canada Is the Link

Over a century ago, leading Canadian intellectuals envisioned a world in which the British Empire, which then included Canada, and the American republic, worked together to forge a world super alliance.

Canada’s would be, in George Monro Grant’s words, “the living link, the permanent bond of union, between Britain and the United States.”

Reinforcing Canada’s key role in this Anglo-Saxon merger, political theorist Robert Conquest recently proposed an association composed of the United States, Britain, Canada, Australia and New Zealand. Writing in the National Interest magazine, Conquest argued that constructing “a community with a genuine cultural unity” would be an act of political prudence in an increasingly fragmented world.

Canada is the link between the U.S. and Britain. The three nations are linked by history, culture, military, trade and, as Otto von Bismark recognized, a common language. Canada’s key negotiation role and mutual understanding of both British and American culture has time and time again proved a key factor in striking agreements between London and Washington.

Combining the Union Jack, Maple Leaf, and Stars and Stripes into an Anglo-Saxon trade trio appears to be the only road left as the ferocious appetite of the EU trade giant gobbles up key international markets. These three prominent international powers are quickly becoming dangerously isolationist! Trouble is on the horizon for Britain, the U.S. and Canada.

All Fall Together

Canada is prophesied to fall alongside its American, British and Commonwealth neighbors. Moral depravity throughout the West, led by Britain and America, has contributed to the point where its very character is in crisis.

As Herbert Armstrong warned, the overwhelming desire brought on by unionism and organized labor to receive maximum benefits for minimum output has driven our nations, especially Canada, to the heights of debt. But Canada was warned!

In 1913, one man crossed from the U.S. over the International Bridge and surveyed the breathtaking beauty of Canada’s Niagara Falls. The same one man, through the pages of the Plain Truth magazine, heralded a warning to Canadians for over half a century. This ambassador for world peace cried out as a voice in the wilderness. Through global broadcasting on radio and television via the World Tomorrow program, Herbert W. Armstrong preached to Canada the true gospel of the coming Kingdom of God (Matt. 24:14). He loved Canada and all Canadians. That’s why he warned them! He saw in advance their national rebellion against the very provider of the bountiful blessings which made them “the great and wonderful country.”

Today, in the tradition of Herbert Armstrong, through the Key of David television program and this very magazine, Gerald Flurry unfearingly prophesies again (Rev. 10:11) of where the U.S., Britain and Canada are headed. It is this very message that will touch the lives of every human being on this Earth. You are reading that message right now!

It is because of the rejection of the very governing law of the supreme unseen hand that is working out His purpose here below that Canada today sees itself fast slipping from world prominence and prosperity.

Canada has forgotten its true identity as Ephraim, one of the sons of Jacob. Now its birthright blessings are fast draining away. With a growing immigrant population representing over 200 separate countries and territories, Canada has turned to other gods. It has faltered in its duty to king and country through its attachment to the British monarchy.

Canada has forgotten God. It has not looked to Him for guidance. Its people are preoccupied with the pleasures of this life, doing what is right in their own eyes (Jud. 21:25). Canada has brought upon itself the consequences of national sin (I John 3:4).

For the immediate future, Canada will reap the bitter fruit it has sown and join with its Anglo-Saxon brothers in an ill-fated “protectionist” alliance that will end with crushing punishment of tribulation by the hand of the rising Eurobeast.

Canada must see that its ways are not God’s ways; that what seems right to them is not right in the sight of God (Isa. 55:8).

Canada must turn back to God! It must heed the warning of the Trumpet magazine and learn the lesson of submitting to God’s loving family government. Canadians must rend their hearts to the gracious and merciful Almighty who gave them such unprecedented bountiful national blessings (Joel 2:12-14). Only then, after deep national repentance, will the great, all-powerful God raise crumpled Canada from the dust and set it on high as a shining example of a nation totally dependent upon Him. Then, Canada will forever be “the great and wonderful country.”