His successor was Mr. A. E. Dallas, who having made a considerable fortune in China, had for some time served the Company on the Pacific coast. Thanks to his prudence, the landing in 1859 of General Harney and a detachment of American troops on the island St. Juan, between Vancouver's Island and the mainland, had been controlled and check-mated by the proposal of joint occupation until negotiations should settle the question of right. He was returning home to England, intending to retire, when he was persuaded to accept the Governorship of Rupert's Land.
Proposals to buy out the Company.
At the head of a scheme for a transcontinental road and telegraph system was Mr. (afterwards Sir) Edward Watkin, well known as the promoter of the Grand Trunk Railway. For this scheme an Imperial subsidy was sought. The dissensions which ensued between the various parties interested proved not unfruitful, for they led up to the great question of buying out the Company.
At the beginning, however, the Duke of Newcastle, then Colonial Secretary, had amiably undertaken to sound the Company as to their willingness to allow a road and telegraphs through their territory.[122]
In response to this demand the aged Governor answered, almost in terror, to the Duke of Newcastle, "What, sequester our very tap-root! Take away the fertile lands where the buffaloes feed! Let in all kinds of people to squat and settle, and frighten away the fur-bearing animals they don't hunt and kill! Impossible! Destruction—extinction of our time-honoured industry. If these gentlemen are so patriotic, why don't they buy us out?" To this outburst the Duke quietly replied: "What is your price?" Governor Berens answered: "Well, about a million and a half."
Discussions as to the price.
On hearing this, Mr. Watkin was anxious that the British Government should figure among the purchasing parties. Purchase seemed the only way out of the difficulty. The Governor and Company seemed to have made up their minds for a sale or else to withstand the project which Mr. Watkin and the rest had so dearly at heart. An endeavour was made to convince the Duke that at the price named there could be no risk of loss, because the fur-trade could be separated from the land and rights, and after the purchase a new joint-stock company could be organized to take over the trading-posts, the fleet of ships, the stock of goods, and the other assets, rights and privileges affecting trade. Such a company, it was figured, would pay a rental (redeemable over a term of years if necessary) of three or three and one-half per cent, on £800,000, leaving only £700,000 as the value of a territory bigger than Russia in Europe. Such a company would have to raise additional capital of its own to modernise its business, to improve the means of intercourse between its posts, and to cheapen and expedite the transport to and fro of its merchandise. It was pointed out that a land company could be organized in England, Canada and America which, on a similar principle of redemption rental, might take over the lands, leaving a reserve of probably a fourth of the whole as the unpaid-for property of the Government, at the price of £700,000. "Were these proposals to succeed, then," said Mr. Watkin, "all the country would have to do was to lend £1,000,000 on such security as could be offered, ample in each case," in his opinion. But a condition was to be imposed if these plans were to be adopted. The Hudson's Bay territory must be erected into a Crown colony like British Columbia, and governed on the responsibility of the Empire. As to the cost of government, there were three suggestions put forward. One was that it might be recouped by a moderate system of duties in and out of the territory, to be agreed upon between Canada and British Columbia on the one hand, and the United States on the other. The second was to sell a portion of the territory to America for five million dollars, which sum Mr. Watkin knew could be obtained. The third scheme was to open up portions of the fertile belt to colonization from the United States. When considering the second plan, the Duke said he would not sell; he would exchange; and studying the map, "we put our fingers upon the Aroostook Wedge, in the State of Maine; upon a piece of territory at the head of Lake Superior, and upon islands between British Columbia and Vancouver's Island, which might be the equivalent of rectification of boundary on many portions of the westward along the 49th parallel of latitude."
As for a name for the new proposed Crown colony, Dr. Mackay had suggested to Mr. Watkin, "Hysperia," and this name was mentioned to the Duke. Its similarity to "hysteria" probably caused it to be dismissed.
Opposition of the Colonial Office.
The decision of the Duke of Newcastle on the whole proposition was that were he a Minister of Russia he would agree to purchase the land from the Hudson's Bay Company. "It is," said he, "the right thing to do for many, for all reasons; but ministers here must subordinate their views to the Cabinet." Nevertheless, he went so far as to believe that it was right. But the Colonial Office were in positive opposition to the scheme.