The 1873 Pacific Scandal erupted following revelations that the Conservative government of Sir John A. Macdonald had granted an American-financed company the charter to build the Canadian transcontinental railway in return for contributions towards the Conservatives’ 1872 general election campaign. The Conservatives resigned in November 1873 and met defeat at the polls. The new Liberal prime minister, Alexander Mackenzie, saw the scandal as a natural by-product of Conservative politics; with ideological leanings towards free trade and individual enterprise, the Liberals naturally pointed out that the scandal involved a rejection of the norms of competition and an assertion of monopoly power.
