The Newfoundland Crisis, alternatively referred to as the July Crisis by the Communist government in Canada and the Crisis of 1949 in modern Canada, was a geopolitical standoff that occurred over the pro-republican movement in Newfoundland's victory in both a May 1949 snap election and a plebiscite over Newfoundland's status in July of 1949. The more ubiquitous "Newfoundland Crisis" term used in the United States and Germany refers to the view in many TATO countries that the crisis was precipitated by events going as far back as 1946, and thus the tensions were a multi-year affair. As a result of the events of July 1949, the "Blue Canadian" government was forced into exile to New York, the Free State of Newfoundland was disbanded violently by the Canadian People's Army and as the exiled Canadians were being evacuated from St. John's, the United States and Canada clashed in a series of incidents that nearly sparked an all-out war between the two nations. It was one of the first major international incidents of the Cold War after the Paris Airlift and was the first one to occur in the Western Hemisphere. American historians later admitted that the Newfoundland Crisis was likely among the closest instances of a Third World War.


Drummondville Agreement and World War Two

The Drummondville Agreement had left Newfoundland positioned awkwardly, with citizens of the Free State feeling like the ceasefire was negotiated at their expense with a lack of gratitude from the Blue Canadians whom they had fought the Communists against. When the Parliament of the Confederation of Canada was formed in St. John's, the Newfoundland government was initially gracious but there remained a strong streak of resentment - particularly amongst a faction of young MA's led by Liberal Party member Peter Cashin - over the terms of the agreement. Nevertheless, the Free State saw an influx of anti-Communist Canadians during the late 1920s and through the 1930s, which caused further societal tensions during the Great Depression, which devastated the Free State. An anti-Quebecois riot in 1934 descended into lynch mob violence, with five Quebecois immigrants hung in a park across the street from the Confederation House.

With the outbreak of World War Two and attacks against North America by Russians on both sides of the continent, Newfoundland, despite its small size, became a key contributor to the war effort. The United States Navy used bases in Newfoundland to wage the Atlantic Campaign while the Canadian People's Army coordinated with Newfoundland, leading many Newfoundlanders to develop a respect for Canada and causing further divides between the Confederationists and the Free Staters. With victory by the Central Powers complete by 1946, Newfoundland looked to the future.

Newfoundland Domestic Politics

The War Government was led by Liberal Party leader Joseph Smallwood, who also served as Prime Minister of Newfoundland. Smallwood was a pro-Confederationist or a "Blue-lover" and sought cooperation with the Confederationist government. With the war coming to a close with the defeat of France in late 1945, the Chinese surrender in January of 1946 and the atomic bombing of Russia that same May, Smallwood would have to call a general election to democratically elect the next government of the Free State. The war years had largely papered over ever-deepening divides in Newfoundland over its role in the world and its relationship with the mostly symbolic Confederation government, which was only voted on by "Blue Canadian" citizens living in Newfoundland or the United States and officially governed no territory. A key sticking point was the insistence upon Confederationists that Newfoundland was a "historically integral part of British North America" and thus, despite not having been a part of the Confederation as formed in the 1860s, fell under the purview of a government that regarded itself as the successor government of the British Empire despite having a loose relationship with monarchism.

Despite Confederationists holding next to no power in Newfoundland's affairs, there remained a strong faction of conservative and liberal Newfoundlanders who had supported the Drummondville Agreement, backed the Blues in the Canadian Civil War and who endorsed the Confederation government's stance that the ultimate geopolitical goal was the "peaceful yet decisive" end of the Proletarian Republic. The two main parties in Newfoundland, the Conservatives and Liberals, had always viewed as unwavering support for Drummondville and pro-Blue standpoints as being the mainstream political view. During the war, they cast the Geoff Sterling-led Newfoundland-American Integration League as well as social democrats and communists who favored stronger ties with the PRC as extremists and fringe figures whose viewpoints did not merit debate.

The political status quo in Newfoundland was heavily shaken up, however, when then-Minister of Defence and Chairman of the Newfoundland Civil Defence Peter Cashin announced he would resign from the War Cabinet on May 29, 1946, while the terms of Russia's surrender were still being negotiated, to support the election of "Newfoundland republicans" to the Assembly of Newfoundland. Cashin, a longtime republican sympathizer, was the first major member of the Free State's political class to endorse and therebey legitimize republicanism.

As of the end of the war, Newfoundland republicanism was more of a hypothetical idea than a likely proposition, with multiple competing factions. Cashin initially belonged to a more liberal faction that believed that Newfoundland had been taken advantage of due to its size at Drummondville and initially only endorsed a re-negotiation of the agreements terms, believing that the Free State's role in the war had entitled it to a position of greater sovereignty.

There was a substantial nationalist right-wing faction, however, which viewed Drummondville as an arrangement imposed upon the independent Newfoundland by foreign powers. Unlike Cashin, this nationalist faction had a deep hostility towards not only the Confederationists but the United States, which it viewed as a foreign occupying power. This faction initially formed the Free State, Free Soil Alliance in 1943 during the first years of American presence and rioted violently on July 4, 1945 during an American Independence Day celebration in St. John's, killing seven Navy sailors and two Newfoundlander women. The so-called "Freemen" became increasing violent and were associated with radical trade unionists, Communists and social democrats by their opponents, and were demonized by rural Protestants for their overwhelmingly Catholic faith.

A third, smaller faction was led by Geoff Sterling and Chesley Crosbie, who favored economic integration not with Canada but with the United States. They had the backing of the St. John's Protestant business community, though had fairly small traction amongst the general public. They believed that full independence and an end to political association with either self-proclaimed government of Canada was crucial to Newfoundland's future, and as Crosbie said in a 1946 speech, "The Blues remain attached to waging the wars of yesterday instead of confronting the challenges of tomorrow." These factions grew in clout by the end of the war and Cashin's defection, along with apparent popular support, was the first sign that the twenty-year status quo in Newfoundland was coming to an end.

Formation of the UNP and NRA and Election of 1946

Two important events occurred during the summer of 1946 on the republican front - the formation of the Newfoundland Republican Association in June and the formal declaration by Peter Cashin of the United Newfoundland Party. Though the UNP was viewed by the establishment as the political wing of the NRA, it also included social democrats and even a single Communist, Robert Brown.of Bonavista. As Cashin declared at a rally at the Mount Pearl racetrack on July 1 that is regarded as the date of formation of the UNP, "We form this party not in the pursuit of a single ideology, but as a mouthpiece for the people in their displeasure with the government of this Free State!" To Cashin and fellow republicans such as P.W. Crummey, Malcolm Hollett and Harry Mews, the UNP's benefit would be an anti-establishment push. Though all four of the main leaders of the UNP in the summer of 1946 were members of the Newfoundland elite, they quickly won sympathies with the more populist and radical NRA, which united the FSFSA with the republican factions of the Liberal Party and later incorporated Crosbie and Sterling's pro-American camp, which threw its full weight behind the UNP.

The Smallwood government, led mostly by Liberals, were alarmed by rapid and unexpected rise of republicanism over the summer of 1946 and consulted Mackenzie King, then the Prime Minister of the Confederation government. King, who supported the eventual unison of Canada and Newfoundland, had been planning to introduce a measure to renegotiate the Drummondville Agreement to make explicit, instead of implicit, that Newfoundland was "part of Canada" and combine the two governments into one. King's designs on consolidation were threatened by republicanism and promised Smallwood's coalition government his support in any upcoming election.

A 3,000 person demonstration was held every day before the Assembly House by Cashin and Hollett for the entire month of August to call attention to veterans of the war who were returning from Alaska, Iceland and Europe. Cashin flew the flag of the Dominion of Newfoundland as well as the NRA's standard at the rally, the first time he openly endorsed the position of the NRA and was a full-throated political republican. Smallwood called an election for October 10, hoping that the UNP, which had promised to contest the next election, would not have the resources to compete with the entrenched Conservatives and Liberals. Smallwood positioned the election as a choice between those who favored the continuation of an anti-Communist British successor state and an independent republic that would be vulnerable to the PRC. There was a significant subliminal tone to the campaign that argued that only Catholics supported independence (despite many prominent republicans being Protestants) and that it was an urban conspiracy against Newfoundland's predominantly rural population.

A number of factors backfired against Smallwood in his campaign, despite his talent as an orator and use of radio advertising to broadcast his message. First was the relative unpopularity of American military presence in Newfoundland, as there had been numerous incidents since 1942 between civilians and US Navy personnel. Second was the twofold issue of Canadian citizens having only voting rights in elections to the Confederationist government, not to the Newfoundland Free State Assembly and the resentments many rural Protestants held towards Canadian immigrants who they interpreted as demanding special privileges without seeking to attain citizenship like immigrants from other countries. The third and most damning problem was the public view, encouraged by Cashin's barnstorming campaign, that Smallwood was a stooge of Mackenzie King's and that he would be willing to further water down Newfoundland's sovereignty. Cashin declared the night before the election that, "If Drummondville is to be renegotiated, let us make sure it is us who renegotiate!" By the time of the election, despite the status quo long since having favored Drummondville's provisions, it had become clear that the landmark agreement was to be renegotiated either in King's direction or in Cashin's. In the course of a few months and to his clear surprise, Joey Smallwood had been marginalized in his own government. The War Government coalition over, the Conservatives campaigned against Smallwood's Liberals as insufficiently supportive of the Confederationits, while the UNP, which temporarily united the left, center and hard-right of the anti-Drummondville spectrum, hit the NLP as having sold out the island.

On October 10, 1946, the UNP joint ticket won an outright majority of 33 out of 50 seats in the Assembly. The Liberals, who had previously held 22, lost fourteen seats, and the Conservatives, who had held 20 seats, lost seventeen. The Socialist Party of Newfoundland lost two of its eight seats to members who defected to the UNP and formed an informal partnership with the UNP thereafter within hours of the election. Peter John Cashin was declared Prime Minister of Newfoundland the next day and accepted the invitation of Newfoundland Governor Charles Hood to form a government.

The First Crisis: 1946-1949

U.S.-Canadian Relations

Though allies in World War Two, relations between the United States of America and Proletarian Republic of Canada had quickly soured in the aftermath. As Germany and Britain were falling out after the Rouen Conference, so too were the United States and Canada. Canadians accused the United States of leaving behind soldiers in its territory for too long and for importing capitalism during the war, while the American government uncovered Canadian spies in the summer of 1946 in prominent labor unions. Despite President Joseph Kennedy of the United States being a Socialist, he was a staunch anti-Communist and many in his administration advocated using the postwar chaos to help stage a coup in Ottawa, launch an invasion of Canada and re-install the Blue Canadians. Despite the opportunity to do so, Kennedy declined, though Canadian leadership learned of this plan and in August drafted a campaign for a pre-emptive war against the United States in which they would stage a surprise attack against industrial centers in Michigan, Ohio and Pennsylvania and thereafter propose a mutual defense treaty with the Confederacy to start a North American War. This was called the "Buck Plan" and was the brainchild of Tim Buck, then the General Secretary of the Worker's Party.

With tensions high, the elections in Newfoundland came at a terrible time. Despite Premier Fred Rose's role at Drummondville, many Worker's Party officials supported the official purging of the Confederation government in that it was a "bourgeois institution" and that Rose had exhibited weakness in not pushing to destroy it in the 1920s. Meanwhile, in the United States, appetites for foreign intervention were low and President Kennedy's popularity was middling despite having just won the war. Non-interventionist Democrats would help stage a victory in the 1946 midterm elections. Concerns over the future of Drummondville reverberated in the United States when they learned through spies in Canada that the "Red Three" of Buck, Rose and Party Chairman Leslie Morris would view any attempt to rescind, amend or withdraw from Drummondville by any of the four parties that signed it would constitute voiding the treaty and thus restarting the Canadian Civil War, an operation Canada felt confident it would win with outright British support. Buck and John R. Clynes, dictator of Britain, consulted one another that very September and agreed that Britain would defend Canada in case of war. With the October elections come and gone, Buck believed that his plan now had teeth with British support and that winning a standoff with the United States was feasible.

Cashin's victory was roundly opposed in American newspapers, with the New York Times declaring "Disaster in St. John's!" and other papers portraying the UNP as a gang of radicals and revolutionaries who sought to agitate a war. President Kennedy phoned Cashin a week after the election and stated to him that any renegotiation of Drummondville would not include the Americans and that Newfoundland had an obligation to maintain its commitments in the treaty. According to popular legend, Cashin was so enraged by what he regarded as Kennedy's patronizing tone that he immediately hung up and began drafting his speech on potential independence. The United States and Germany began consulting one another on whether the new government in St. John's would need to be deposed.

The Cashin Government

Despite his furious campaigning, Cashin had at most been expecting to gain ten seats in the Assembly and become the opposition party. The overwhelming victory came as a shock not just to the Newfoundland political establishment and outside world, but to the anti-Drummondville forces as well. As a result, Cashin was unprepared to govern and this affected his style.

Cashin immediately set about making changes within days of his government taking their seats. With an outright majority, Cashin's factional party began infighting, with the two Socialists who crossed the floor demanding an outsized role in the Cabinet in returning for delivering Socialist votes that Cashin correctly observed he did not need to set policy. By November, the Socialists had re-crossed the floor and Cashin's majority was reduced back to 31. Cashin made Malcolm Hollett his Minister for Foreign Affairs and P.W. Crummey his Minister of Defence and dispatched Geoff Sterling as Ambassador to the United States. Cashin's first meeting was with Mackenzie King, who bemoaned Cashin's opposition to Drummondville but conceded that Newfoundland had clearly spoken that it desired the right to self-determination. Cashin instituted major changes in the Free State's relationship to the Confederation government at the civic level, officially eliminating the long abhorred "dual responsibility" for the Newfoundland State Defense Forces as agreed upon in the 1930 Common Defence Act, though he initially made sure not to touch any provisions that may affect Drummondville. He promised to, within six months, negotiate terms of deployment for American soldiers in Newfoundland, expand collective bargaining rights, increase tariffs and formally ban the levying of income taxes. He agreed to adopt the flag of the NRA as the Free State's flag as per a national referendum and debated making other small moves to more formally separate the notion that the Free State was a Canadian state. He encouraged expressions of Newfoundlander culture and passed a bill in late November requiring all products exported to "proudly announce their origin here in Newfoundland."

The more radical elements of his party and the NRA pressured him into making a more emphatic statement about Newfoundland's status, however, and Cashin decided to give a brief address on his views immediately before Christmas in 1946. On December 20, the last day the Assembly was convened before a two-week holiday, Cashin took the floor and read from pre-prepared remarks:

"The events of 1926, while admirable in their pursuit of peace on the continent, represent as much today as they did then an infringement upon the sovereignty of the Free State, and a violation of the right to self-government by this Free State. The events at Drummondville, though with an admirable goal for the preservation of Canadian freedom from the oppression of Marxism, created instead the oppression of internationalism here in Newfoundland. It is for this reason that I advocate a consideration of an independent, inviolable Republic of Newfoundland - separate from Canada, separate from Britain. Constitutionality, not communism or confederation, will be how the people of this country throw off the yoke of oppression."

Though widely applauded by the NRA, the speech horrified the traditionalists and pro-Drummondville establishment in rural Newfoundland and enraged the King government, which threatened strikes and demonstrations of Canadian refugees. When word of Cashin's speech reached Canada, the top officials circulated a memorandum stating that Cashin's speech "represents an intention to commit actions which would violate the ceasefire negotiated at Drummondville and reignite war upon this continent mere months after war was concluded."

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