Yes. What we were asked to agree to was, that we would not exercise the power of foreclosure unless the default in the payment of interest should be for five years. As a matter of business between man and man, I think that was a fair and reasonable arrangement and no one in the country is going to be alarmed because we gave the company that assurance. Then as to the manner of foreclosure. In the original contract it was provided that we might take possession of the road in case of default, but in the amended contract it is agreed that as the government and the company would have an interest jointly, then, what I understand is the English system will be adopted, and the road will be pii t into the hands of a receiver, who will act as the representative of both parties and who will distribute the earning in proportion to the interest of the parties concerned. That does not seem to be a very grave or a very serious change in the original contract. Surely, when the Grand Trunk has an interest in common with us, we should be willing to see that the earnings are fairly distributed, and that while we have received our proportion the Grand Trunk Company should receive theirs. Their obligation to pay the interest on the second bonds still remains.
Another amendment is, as regards the running powers over the eastern division after fifty years. Why should we not give them running powers over the eastern division at any time ? Is not the whole design of the scheme that the eastern division should be a common national highway between the east and the west; is not the whole theory that we should give running powers to every railway company who desired them ? And, if the Grand Trunk Company after fifty years are dispossessed ; if the government then determines to take over the eastern division and not allow the Grand Trunk Pacific to operate it any longer, what possible objection can there be to granting running powers to them or to any other railway which is able to utilize the privilege ?
There is another change in the contract as respects branch lines after fifty years ; but we discussed that so recently that I would not be justified in enlarging upon it now. The Grand Trunk may during the fifty years of this lease build branch lines and when the government take over the road these branch lines will be useful to one party or the other. It may be that some of these branch lines would not be profitable to the Grand Trunk Pacific but would be profitable to the government as owners of the main line. I pointed out the other day that in the case of a short branch it would not pay the company to run it as an independent road, and what might then be an unprofitable transaction for the company might be a very profitable one for the
government who would be owners of the main line. In connection with that I may present the view that in this period of great expansion in the Dominion, with the splendid growth of our country, evidence of whch we see around us on every side, surely there is no one so lacking in faith in the future as to believe that fifty years hence any one of these branch lines would be unprofitable. I am sure that on reflection hon. gentlemen opposite will agree with me, that with the rate of progress our country is happily making, and especially our western country, the increase of traffic over all these lines must be such that it is hardly reasonable to conceive that fifty years from this date, any one of these branch lines could be regarded as unprofitable. [DOT]
There are two remaining amendments and they are of some financial importance. One is with regard to the guarantee on the mountain seetion of the western division. In my calculation last year I was advised that 480 miles was the proper estimate of the mountain section, and I shall continue to use that calculation, although I notice that Sir Rivers-Wilson speaks of it in round numbers as 500 miles. As regards the prairie section, we guarantee three-fourths the cost of the road, not exceeding $13,000 per mile, and there is no change in the contract in that respect. But with regard to the mountain section 480 miles or 500 miles, our agreement of last year was that we would guarantee three-fourths of the cost not exceeding $30,000. It was roughly estimated that this part of the road would probably cost $40,000 per mile. We quite understood from the beginning that we would be expected to guarantee three-fourths of the cost, and the limit fixed was supposed to represent that. But we provided that if the road should cost more than $40,000 per mile, the Grand Trunk Pacific people had then to take that risk. The company came to us and said that this was regarded as a difficulty in the minds of some of their people. They said that the cost of the mountain section might prove to be more than $40,000. a mile, and some of their people were afraid that if the government were only to guarantee $30,000 a mile the Grand Trunk's proportion would be larger than they expected, and that prospect introduced an element of uncertainty.
They thought the element of uncertainty should be divided between the government and the company. They thought the government should agree to guarantee three-fourths of the cost, whatever it might be. Both parties will have an interest in seeing that that cost is not an extravagant one. Both parties will have a common object in seeing that the cost is kept down. But they proposed that instead of limiting our guarantee of the mountain section to $30,000 a mile, we should make it three-fourths of the
cost whatever it might be found to be ; and that amendment the government have agreed to make. That amendment involves us in some measure of increased obligation. Precisely what that increased obligation is I suppose must remain a matter of debate.
It was roughly estimated at first that the mountain section would cost $40,000 a mile.
I notice in the discussion that took place before the Grand Trunk shareholders in London, Sir Charles Rivers-Wilson made reference to that part of the road as likely to cost $50,000 a mile, to which he added interest during construction, bringing the cost up to $56,000 a mile. We are inclined to think that is a high estimate. But let us frankly say that if the mountain section of the western division costs much in excess of the original estimate of $40,000 a mile, then to the extent of our proportion of the increased cost we are assuming an additional obligation. I do not think, however, that it is a very great obligation and if it maintains the proportions of three-fourths and one-fourth, we do not think the country will regard it as a very formidable charge.
The remaining clause of financial importance deals with the question of implementing the guarantee on the western division. When this contract was entered into, or perhaps it would be more correct to say [DOT] when the negotiations began about a year ago, the money market was in a fair condition ; and it was estimated in all the negotiations that a government guarantee bearing three per cent interest would probably sell at par. As the months rolled on, by the time the Grand Trunk people came to be in a position to discuss the matter in financial circles, the money market had taken a very unfavourable turn, and the company thought they -would not be able to raise the necessary money on a government guarantee of 3 per cent. They pointed out that if they had to sell the bonds below par, they would be to that extent short of the means to build the road, and they asked us to agree that the amount of aid we had agreed to give them in money should be in some shape made up. After some discussion, because it was a serious aspect of the question, we came to the conclusion that we would meet them in that respect, and would rearrange the financial affairs of the western division, so that they might expect to realize a sum equal to par from the sale of the bonds. The form in which that is to be done is not distinctly laid down in the agreement ; but, as we have pointed out during the debate, a rational and reasonable -way would be to implement the amount of the bonds to be issued, so that by issuing a larger amount of bonds at 3 per cent, the company would realize as a net result of the transaction a sum equal to par of the first amount. That is the way we have all assumed in the debate that the matter should be arranged, and I have no doubt
which in extent, I venture to say>
is unsurpassed in the North American continent, perhaps in the whole world.
I am satisfied that It is possible to establish a splendid national railway on the route proposed with the best ocean ports as its terminals. With a Rocky Mountain passage very much lower than that of any railway yet constructed across the North American continent, and with general engineering features even more favourable than those obtained on the Intercolonial Railway, such a line would give breadth to Canada and admit of settlements and profitable industries where such are not now possible.
I have another bit of testimony. My right l.on. friend the First Minister has said there are mountains of information on this subject, but we will be content with only a few hills to-night.
To-day, in the morning paper, I find a report of the evidence before the Transportation Commission by Dr. Bell and Mr. Macoun. Mr. Macoun'. after dealing somewhat with the Peace river country is reported as follows :
Mr. Macoun also gave evidence regarding parts of Georgian bay that he had visited. He stated that he had been with the expedition under Mr. Low that went to Hudson bay from Lake Winnipeg via the Berens river. The country through which the Berens river flows, he said, is very rocky. But at Trout lake, 54 degrees north latitude, a settler of seventeen years' experience had told him that he had never lost any crops through frost. The settler's cultivation extended to all the usual farm crops. Surrounding Trout lake there was an immense area over a hundred million acres in extent which was good agricultural land. Its climate was temperate on account of comparatively low altitude and summer frosts were very infrequent. Most of the country between Lake Winnipeg and Hudson bay, Mr. Macoun said, was practically unburned. He thought that a good deal of the land on the east coast of the bay was suitable for agriculture. At Rupert's bay there was no natural harbour, but at Richmond gulf the harbour was excellent.
In reply to a question the witness said that in the sub-arctic forest belt of Canada there were, approximately, 1,000 millions of acres of agricultural land.
Such is the information given us in general terms regarding that vast northern country. Some portions of this evidence refer to sections through which the road will run, while other portions refer to land lying further north. But if we have, north of our railway, great tracts of land that are good, then, by all means, the nearer we can get the road to these tracts the better. And, inasmuch as we are going to build a road further north than any other in America, we shall do something "to develop these tremendous stretches of land described in the words I have quoted from Mr. Macoun. Sir, one does not need the gift of prophecy to predict that, within the lifetime of men in this parliament to-day, the timber, the land, the mines, the waterfalls in that vast stretch Mr. FIELDING.
of territory will be the foundations upon which will be built villages, towns, and, possibly, cities that will stand as testimony to the wisdom of the policy that sends the railway through that north land.
Now, I have spoken so far of the attacks made by hon. gentlemen opposite upon the country between Winnipeg and Quebec, upon what I may call the western part of the eastern division. But, bad as that enterprise is said to be, bad as the policy of the government is said to be which holds out the hope of railway construction through that vast territory, there is a lower depth still to which this government have descended, for they have actually agreed to build a railway from Quebec down to the city of Moncton. Horror of horrors ! It makes the hair of hon. gentlemen opposite almost stand on end. My hon. friend from West Toronto (Mr. Osier) prayed Heaven that the road might never be built. And up and down the ranks of hon. gentlemen opposite has gone the cry that that road is the iniquity of iniquities. Well, now, we can
make some allowance for hon. gentlemen from Ontario and the west for taking such an ungenerous view of the matter. Perhaps I should rather say we could have made some allowance last year, because they were not expected to understand eastern public opinion ; they were not expected to be as familiar as others would be with the condition of the provinces down by the sea. But, if we could make some allowances last year, we have less right to make allowances now, because, in the meantime, they have had the opportunity of learning a good deal about the matter. My hon. friend from Cumberland (Mr. Logan) last year took a good deal of pains to collect testimony as to the longstanding public opinion in the maritime provinces with regard to that road, and I may have occasion to allude to part of that evidence before I conclude. I say we can make allowances for the hon. gentlemen from Ontario and the west so far as last year was concerned, but not so much this year. But I confess that I have great difficulty in making allowance for my hon. friends opposite who come from the eastern provinces. They ought to have known better ; and, unless they are very much less intelligent than I take them to be-for I know that they are intelligent, able, capable men-I am bound to believe that they do know better. But when they sit quietly in their places and allow hon. gentlemen on their own side to create the impression that this road from Quebec to Moncton is an unheard of enterprise, a thing which nobody wanted and nobody believed in, then, they do not do justice to their own part of the Dominion. Why, Sir, for very many years, as far back at least as 1889, we have had an agitation in the lower provinces for the construction of a short line or railway from Quebec to Moncton. Yet, hon. gentlemen oppo-
site would talk as if it were something that nobody had ever heard of, a wild scheme which recently entered into the imagination of some crazy persons. Down in the maritime provinces, the newspapers, the boards of trade and all the ordinary avenues through which we receive expressions of public opinion have over and over again called attention to the desirability of this road. But my hon. friend the leader of the opposition (Mr. R. Ij- Borden) seems to think that it ife a bad scheme, that there is no good in it whatever. I notice that in the earlier stages of this discussion lie was willing to do something in the west. He was willing to build over the prairies, to build in some shape across to the Pacific ; but, when it came to this section Quebec to Moncton, all he would agree to do would toe to give a gracious consent to inquire into the question whether there was any merit in the scheme. And, in the omnibus amendment he moved some time ago there was no reference to the Moncton road. I think that is a very strange proceeding on the part of my hon. friend. He was ready to build through the west, through the mountains-anywhere but in the maritime provinces. I do not think that is a fair position for him to take. I do not think he should allow his friends from Ontario to drive him into such a position. *My hon. friend said that he would be good enough to kindly inquire-I do not know when, but some time in the distant and uncertain future, after he has built over the prairie and through the rockies-he would take time to inquire whether there was any merit in the Moncton scheme. And, if he could make up his mind that we were to build the Moncton section, it must be as part of the Intercolonial Railway.
Subtopic: GRAND TRUNK PACIFIC RAILWAY.