Chinese "Contract Labour" And Canada’s Immigration Catastrophe

November 02, 2006

National Data, By Edwin S. Rubenstein

Chinese “Contract Labor” And Canada’s Immigration Catastrophe

My recent article on Chinese “contract labor” being brought in for post-Katrina rebuilding inspired a Canadian reader to recount his country’s experience. Dan Murray, of Immigration Watch Canada, writes:

“I was particularly interested in your article because I have done a considerable amount of research on the Chinese Head Tax issue in Canada. You may wonder what the connection is. To put the matter briefly, the Chinese Head Tax (and eventually Canada’s Chinese Exclusion Act) were responses to Chinese contractors (mostly Chinese businessmen already in Canada) bringing cheap Chinese labor to Canada. This created an enormous amount of hostility which has been glossed over by the media today (most of whom know nothing about the history) as being rooted in racism. The central point is that economic factors such as underbidding for jobs caused much of the hostility against the Chinese.” [e-mail to Ed Rubenstein, October 10, 2006]

The Canadian government was under extreme pressure to cut costs incurred in constructing the country’s first transcontinental railroad in the 1880s, and cheap Chinese labor was seen as crucial. At its peak, about one-third of British Columbia’s labor force was Chinese.

When Canadian workers complained about unfair competition from the low-wage Chinese, the response of the Canadian government was familiar:

“.When Prime Minister John A. Macdonald heard complaints about the unfair wage advantage the Chinese enjoyed, he repeatedly (but likely inaccurately) pointed out that Canada had allowed Chinese laborers to enter the country solely because there was a shortage of labor in the early 1880’s. The Chinese, he said, would be leaving when construction had been completed. B.C. laborers should just be patient” [ April 5, 2006: Some Conclusions About The Chinese Head Tax and Chinese Exclusion Laws,]

Of course, the Chinese influx continued even after the railroad was built. This prompted the first Chinese Head Tax, a fixed fee levied on each Chinese immigrant, set at $50 in 1885. Subsequent Administrations increased the tax to $100, and in 1904, to $500. (Five hundred dollars in the early 1900s was enough to purchase two homes in Montreal.)

Yet even this high level of tax did not restrain Chinese immigration. From January 1904, when the tax was increased to $500, until the passage of the Chinese Exclusion Act of 1923, 42,444 Chinese paid the Head Tax to come to Canada. In the prior 18 years (1885 to 1903) 39,925 Chinese paid the Head Tax. [ Chinese Head Tax Issue Speech to the 12th AGM of the National Congress of Chinese Canadians, Senator Vivienne Poy]

How could they afford it? The answer, of course, is that the tax wasn’t paid by the laborers themselves, but by their contractors a.k.a. gangmasters who “loaned” them the tax payments in return for their indentured servitude. “Later, to have workers repay their debts, they collected pay from employers and then deducted an appropriate amount each pay day from each laborers wages,” Murray writes.

The Chinese Immigration Act of 1923, which barred Chinese immigration, was the only recourse.

Fast forward to 2006.

Canada currently admits about 250,000 legal immigrants annually, or approximately 83 per every 10,000 residents. By comparison, the U.S. is almost xenophobic: we admitted 1.12 million legal immigrants in 2005, or roughly 38 per every 10,000 Americans. On a per capita basis, Canadian immigration is the highest in the world.

Most Canadian immigrants come from China (still), India, the Philippines, and other Asian countries. Dan Murray informs us that many of the recent arrivals have been sponsored by false refugee claimants who arrived earlier and were granted refugee status. In effect, illegal immigrants are driving much of the current legal influx to Canada.

So what is the Canadian government doing re immigration?

On June 22, 2006 Prime Minister Stephen Harper formally apologized to Chinese immigrants for the country’s treatment of Chinese immigrants between 1885 and 1923. Harper pledged financial restitution.

(This despite being allegedly influenced, while a student, by Peter Brimelow’s book on Canada! And, for the record, this is what Brimelow’s “Alien Nation” reports is the response if you ask how you can go about immigrating to China today:

Chinese Embassy Official [laughs]: “China does not accept any immigrants. We have a large enough population. A foreigner can visit on a tourist visa that can be extended for up to six months. Then you must leave. To apply for a temporary work permit, you must first have an official letter of invitation from a company authorized by the Chinese government.”)

Chinese-Canadian groups expect the Canadian government will offer a multi-million-dollar compensation package to survivors who paid the Head Tax, their widows and their children.

An update from Dan Murray:

“By the way, just heard a news item about a talk our Prime Minister gave to a group in Vancouver’s Chinatown last night. [PM addresses Head Tax and lauds accomplishments of Chinese Canadians] He told a sentimental story about his wife’s connection to the issue and then said that compensation checks for the Chinese Head Tax would be in the mail by November of this year. I believe he knows nothing about the economic reasons for the Head Tax and does not want to hear anything that might disturb his sleep.” [e-mail to Ed Rubenstein, October 11, 2006.]

Edwin S. Rubenstein (email him) is President of ESR Research Economic Consultants in Indianapolis.