Canada and Newfoundland

by Frank G. Carpenter

The Canada that we know to-day may be said to have had its beginning when the Canadian Pacific Railway was put through to the west coast. In 1880 the job was turned over to a syndicate that soon became world famous. Its contract called for completion of the line in ten years, but it was finished within half that time. This saved British Columbia to the Dominion, and gave the British Empire another link in its world communications, including a direct route through its own possessions to the Far East and Australia. Within two years after it reached the western ocean, the Canadian Pacific began its steamship service to Japan and China, and tapped the Orient for cargoes to furnish traffic on its land line. Sixteen years later it bridged the Atlantic. It now has on both oceans a fleet of more than thirty vessels, including some of the finest passenger steamers afloat. In its lake, river, and coastwise services it operates fifty additional ships. It offers now a favoured route between London and the Far East. The distance from Canton, China, to Liverpool, via Canada, is fifteen hundred miles shorter than by way of San Francisco and New York, and the journey takes much less time than that by the Suez or Panama all-water routes.

Much of the main line between Montreal and Vancouver is being double tracked; the mountain grades are constantly being reduced; tunnels are taking the place of construction exposed to the snows; branches and connections have been extended northward into new country, and southward to connect with United States lines. To pay its nearly seventy-five thousand employees takes almost eight million dollars a month. Its car shops at Angus, near Montreal, are one of the largest works of the kind on the continent, and they employ more than six thousand men. Its freight yard at Winnipeg is among the biggest in the world. Though the company is not fifty years old, its total assets were recently valued at a figure in excess of one billion dollars. It is, next to the government, the most powerful single organization within the Dominion, and its influence is felt in Europe and Asia.

The success of the Canadian Pacific, and the development that followed, started in Canada the fever for railroad construction that burned itself out only a few years ago. The provincial and the Dominion governments and even municipalities eagerly backed almost any railroad project that promised to open up new territory. Not only were charters granted freely, but the obligations of the constructing companies were guaranteed, and cash subsidies advanced to the promoters of new lines. The actual transportation needs of large areas were discounted decades in advance, and competing lines were built parallel to one another in districts producing hardly enough traffic for a single railroad.

In 1903 the Grand Trunk, the oldest railroad system in Canada, contracted with the government for the construction of a new transcontinental line from Quebec to Winnipeg and from Winnipeg to Prince Rupert, a new terminus on the Pacific Coast, a total of 3559 miles. In the meantime, another road, the Canadian Northern, starting in Manitoba, spread itself through the prairie provinces, crossed the Rockies, and entered into competition with the Canadian Pacific at Vancouver. By 1914 it had bought and built a total of 9400 miles of railway. The Grand Trunk also had grown, and it then had 7500 miles of tracks, a chain of hotels, steamship lines on the Pacific coast, and grain elevators and terminals in the Dominion and the United States. Both roads crossed the Rockies at the same point, giving Canada two transcontinental lines over the northern route where one would have been plenty.

It was in 1914 that these railroad chickens came home to Ottawa to roost, and the end of the World War found the government up to its neck in the transportation business. This did not come about by anybody’s choosing, but through the working of forces set in motion years ago. The Dominion government was first led into running railroads by its bargain with the Maritime Provinces. Out of this came government operation of the Intercolonial Railways serving the eastern provinces and joining them to the St. Lawrence basin. This system never earned any profits. The government built the National Transcontinental from Quebec to Winnipeg on the understanding that the Grand Trunk would lease it for fifty years. When it was finished, the corporation begged off, and the government was compelled to operate the line. In 1914, the owners of the Canadian Northern announced that unless they received sixty million dollars at once they would have to suspend. They got the money. Two years later it was the Grand Trunk Pacific that appealed to Ottawa for financial aid. Sustaining these railroads was such a drain on the public treasury that finally the government assumed responsibility for all their obligations and absolute control of the properties. It then began to weld them into the single system now known as the Canadian National Railways.

For years the Canadian Pacific Railway has paid dividends regularly. The lines making up the Canadian National have, for the most part, never paid anything, and they were unloaded upon the government because they were regarded more as liabilities than as assets. As the largest taxpayer in Canada, the Canadian Pacific Railway Company must contribute indirectly to the support of its competitor, unless the government lines are able to earn their own way.

After the war, one year’s deficit on the government lines was sixty-seven million dollars. In railroad subsidies, Canada has paid out nearly three hundred million dollars. Bonds and other railroad obligations to the total of four hundred and fifty-five millions have been guaranteed, while four hundred and seventy millions of public moneys were spent in building roads for the government. One student of Canada’s railroad policy tells me that the national treasury would now be four hundred millions to the good if the government had given the National Transcontinental, the Canadian Northern, and the Grand Trunk Pacific to some corporation, and had thrown in a cash bonus of two hundred millions besides.

The government railroads now furnish a complete service to virtually all parts of Canada, including the chief ports, from Halifax on the east coast to Vancouver and Prince Rupert on the west. The Canadian National Railways operate the Grand Trunk hotels and west coast steamers, and also the sixty-five ships of the Canadian Government Merchant Marine, which sail the seven seas. The curious situation exists of railroads owned by the government of Canada using two thousand miles of track in the United States. Nothing was thought of the Grand Trunk having terminals at Portland, Maine and New London, Connecticut, and Chicago, but the government ownership of these properties raises the possibility of conflict between the two countries in railroad matters.

The government is fortunate in having in charge of the Canadian National lines Sir Henry Thornton, one of the great railroad men of the time. To him all Canada is looking to find the way out of the wilderness into which circumstances have brought the Dominion. Under his administration duplicated services are being eliminated, and the deficits have been greatly reduced. He is confident the lines can be made self-supporting. He said the other day:

“The world expects the Canadian National Railways to fail. It does not believe that we can make them succeed. I do. I believe that if the army of workers lines up behind us, we shall achieve the greatest success the annals of transportation have ever recorded.”