Onward Into the 21st Century: The Creation of Nunavut & More

Elements of the Canadian economy are still adapting to the landmark North American Free Trade Agreement concluded with the States in 1989. While free trade hasn't done much to revive the smokestack industries that once were the engines of eastern Canada, the agreement, combined with a weak Canadian dollar in the 1990s, was actually good for much of Canada's huge agricultural heartland. However, the globalization of trade is transforming the Canadian economy in ways that produce confusion and hostility in some citizens. Many Canadians are deeply ambivalent about being so closely linked to their powerful southern neighbor, and the trade agreement (and U.S. culture in general) often gets the blame for everything that's going wrong with Canada. Yet 85% of Canada's trade is with its southern neighbor -- so it's a relationship that will need to be worked out in some form or other.

Public interest in protecting the environment runs high, as reflected in public policy. Recycling is commonplace, and communities across the country have made great strides in balancing economic interests with environmental goals. On Vancouver Island, for example, environmentalists and timber companies agreed in 1995 on forestry standards that satisfy both parties. When salmon fishing boats blockaded an Alaska ferry in Prince Rupert in 1997, the issue for the Canadians was perceived overfishing by Americans. Salmon have been reduced to an endangered species in much of the Pacific Northwest, and the Canadians consequently don't think much of U.S. fisheries policies.

In 1999, the huge Northern Territories divided in two. The eastern half, which takes in Baffin Island, the land around Hudson's Bay, and most of the arctic islands, is now called Nunavut and essentially functions as an Inuit homeland. The rump Northwest Territories officially retains the territory's old name, though many refer to the region as the Western Arctic.

The success of the Nunavut negotiations has emboldened other Native groups to settle their own land claims with the Canadian government. While many of the claims in northern Canada can be settled by transferring government land and money to Native groups, those in southern Canada are more complex. Some tribes assert a prior claim to land currently owned by non-Indians; in other areas, Native groups refuse to abide by environmental laws that seek to protect endangered runs of salmon. The situation in a number of communities has moved beyond protests and threats to armed encounters and road barricades. The path seems set for more and increasingly hostile confrontations between official Canada and its Native peoples.

The early years of the 21st century have been generally positive for Canada. The Canadian economy has strengthened markedly, and the Canadian dollar is stronger against the U.S. dollar than it has been in decades. In 2007, the loonie pulled ahead of the U.S. in value for the first time since 1957. At the same time, Canada has begun to distance itself from the dictates of Washington and is charting its own path on international issues. Canada did not join the U.S.-led "Alliance of the Willing" in its war against Iraq, and its determination to hold the U.S. accountable to pro-Canadian World Trade Organization decisions in the long-running softwood lumber disputes further marks a newfound Canadian policy independence.

Indeed, as the U.S. follows an increasingly unilateralist international program and as Canada embraces progressive policies in issues such as the legalization of marijuana and sanctioning of same-sex unions, Canada finds itself at odds with its powerful neighbor. With social and political values more in line with the nations of "Old Europe," one can foresee Canada increasingly charting its own way on the international stage. In fact, in 2003 the English newsmagazine The Economist, in a series of articles titled "Canada's New Spirit," stated, "Canada has been going through quite a renaissance, in public policy as well as its economy. Indeed, a cautious case can be made that Canada is now rather cool."

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