James Aloysius McGrath was born in Buchans, Newfoundland, on January 11, 1932, the ninth of fifteen children born to Patrick McGrath and Mary Cole. In 1939 the family moved to St. John's. McGrath was educated there at St. Patrick's Hall School. McGrath left Newfoundland in 1949. He joined the Royal Canadian Air Force in 1950 and served until 1953 when he returned to Newfoundland. In St. John's he began work as advertising sales manager with the new radio and television network, CJON, and worked there until 1956.
McGrath began his long association with the Progressive Conservatives by campaigning for the party in the first Newfoundland provincial election in May 1949 and in the first federal election after Confederation in June 1949. A provincial election was held in Newfoundland on October 2, 1956. McGrath entered the contest as PC candidate in the dual-member constituency of Harbour Main with Arthur Harnett, a colleague from the CJON network, as a running mate. McGrath and Harnett were both close but were unable to counteract the Liberals, who were returned to power. In late November 1956, both McGrath and Harnett resigned from CJON and together with Brendan Walsh formed the Weekly Publishing Company. In the 1957 federal election campaign, twenty-five year old James McGrath was the PC candidate in St. John's East and became the youngest member elected to the House of Commons. In the 1958 election McGrath was re-elected.
He was appointed an Executive member of the Canadian Branch of the Commonwealth Parliamentary Association in 1957 and a member of the North Atlantic Treaty Organization (NATO) Parliamentary Association in 1958. In 1958 McGrath also served as Vice-chair of the Canadian delegation to the first Atlantic Conference of Political Youth Leaders held in Paris under NATO sponsorship. In 1959 he was the co-ordinator for the PC Party in Newfoundland for the provincial election held on August 29 and was appointed by the Prime Minister to the House of Commons Committee on Broadcasting.
In the federal election held on June 18, 1962, McGrath was re-elected in St. John's East. McGrath was the only Progressive Conservative elected from Newfoundland and many thought Diefenbaker would appoint him to the federal Cabinet, but instead McGrath was made Parliamentary Secretary to the Minister of Mines and Technical Surveys, Paul Martineau. He held this position until the defeat of the Diefenbaker administration in the election of April 8, 1963. In that election McGrath lost his St. John's East seat, but decided to stay in Ottawa after his loss, accepting a position as Executive Assistant to the PC Opposition Leader in the Senate, Alfred J. Brooks. He remained in that position for only a short time and in 1964 he moved to Montreal. By the summer of 1965 he had returned to St. John's, where he served as provincial coordinator for the federal election held in September of that year. He later became vice-president and general manager of Mercer Brokerage Limited. Subsequently, he joined Sun Life Assurance Company of Canada as an insurance broker.
When a federal election was called for June 25, 1968, McGrath announced his intention to seek the PC nomination for St. John's East and succeeded in winning the nomination. In Newfoundland, the PCs won six of seven federal seats and McGrath was elected in St. John's East. The Liberals had been returned to the House of Commons with a majority and McGrath, therefore, became a member of the Opposition for the first time. McGrath was re-elected to the House of Commons for St. John's East with large majorities in the federal elections of 1972, 1974, 1979, 1980 and 1984.
Newfoundland elected two PCs to the House of Commons in the 1979 federal election and Prime Minister Joe Clark appointed McGrath Minister of Fisheries and Oceans and Crosbie Minister of Finance. When Clark's minority administration was defeated, the Liberals returned to office with a majority. After the defeat of the PC Party in the 1980 election, there were many calls for a review of Clark's leadership and he asked for a leadership convention later in the year. McGrath had supported Brian Mulroney in 1976, but this time decided to support Clark. Mulroney won and in the federal election of September 4, 1984 he led the PC Party to victory. Both McGrath and Crosbie had held senior positions under Clark, but when Mulroney appointed his Cabinet, he included only Crosbie. In December 1984 Mulroney did appoint McGrath as his emissary to the Auditor General, Kenneth Dye, who was threatening to take the Prime Minister and Cabinet to court over government funding of Petrofina. McGrath and the Auditor General formalized an agreement without resorting to court action.
In 1984 Mulroney appointed McGrath as chair of the Special Committee on Reform of the House of Commons charged with investigating the operation and efficiency of the House of Commons. The committee produced a lengthy report in 1985 recommending many changes including better research facilities and funding for Parliamentary committees and greater opportunities for back benchers to introduce legislation and to speak on issues. In 1986 McGrath was again passed over in a major cabinet shuffle and later that summer he accepted Mulroney's offer to become Lieutenant Governor of Newfoundland.
McGrath served as Lieutenant Governor of Newfoundland from September 3, 1986 until November 5, 1991 and during that time he received many awards and honours. One of the first was from the Boys and Girls Club of Canada which presented him with its Humanitarian Keystone Award. In February 1987 he was made a Knight of the Sovereign and Military Order of Malta. That same month he was presented with an Honorary Life Membership in the Commonwealth Parliamentary Association. In November 1987 he received the Award of Excellence of the Churchill Society for the Advancement of Parliamentary Democracy. In June 1989 he was presented with the Boy Scouts of Canada's Silver Acorn in recognition of his distinguished service to the scouting movement and in February 1991 he was made Honorary Chief of the Royal Newfoundland Constabulary. In 1979 McGrath was awarded an Honorary Doctor of Laws degree from St. Francis Xavier University.
James McGrath married Margaret Smart of Westmount, Quebec, on September 24, 1960 and they have six children: Kathleen, Caroline, Margaret-Moira, Joanna, and twins, Sheilagh and Sean.