In 1846 Peel himself undertook the repeal of the
Corn Laws. To Lower Canada this was a crushing blow. Until of
late the preference given in the British market on colonial goods
in return for the control of colonial trade had been of little
value; but in 1848 the duties on Canadian wheat and flour had
been greatly lowered, resulting in a preference over foreign
grain reckoned at eighteen cents a bushel. While in appearance an
extension of the old system of preference and protection, in
reality this was a step toward its abandonment. For it was
understood that American grain, imported into Canada at a low
duty, whether shipped direct or ground into flour, would be
admitted at the same low rates. The Act, by opening a back door
to United States wheat, foreshadowed the triumph of the cheap
food agitators in England. But the merchants, the millers, and
the forwarders of Montreal could not believe this. The canal
system was rushed through; large flour mills were built, and
heavy investments of capital were made. Then in 1846 came the
announcement that the artificial basis of this brief prosperity
had vanished. Lord Elgin summed up the results in a dispatch in
1849: "Property in most of the Canadian towns, and more
especially in the capital, has fallen fifty per cent in value
within the last three years. Three-fourths of the commercial men
are bankrupt, owing to free trade.
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