March 30, 1909

CON

Robert Laird Borden (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. R. L. BORDEN.

I am estimating it at 34 per cent, and I am putting the bonds at 90. That is a matter of conjecture and it may be that my hon. friend the Minister of Finance may find some fault with my calculation in that regard. I do not know as much about the probable figures as he would know, and I would be ready to defeT to his superior judgment in case he thinks the calculation I have made is not upon a fair basis.

Now, the Grand Trunk Company would, in the ordinary course, contribute a guarantee of about $20,500,000 towards the prairie section, but I would assume that their guarantee in that regard would be cut down by the proposed loan of $10,000,000, which would diminish it to $10,500,000. If our guarantee upon the mountain section amounts to $54,750,000 the guarantee of the Giand Trunk Railway Company will amount to one-third of that, or one-fourth of the whole, which would be $18,250,000. So that the total amount contributed by the Grand Trunk Rail-way Company for the western division would amount, as I estimate it, roughly speaking, to a guarantee of bonds of $28,750,000. The figures are as follows :

WESTERN riVISION.

Country contributes.

Prairie section, 916 miles at $13,000=$11,908.0)0

Mountain section, $67,000,000

Bonds at 90 p.c.,$73,000,000. .75 p.c.= 54,750,000

' $66,658,000

Proposed loan 10,000,000

Cash payment interest for 7 years... 13,413,750

One year = $1,916,250

Grand Trunk contributes.

Prairie section $10,000,000

Prairie section $10,500,000

Now, I estimated last year that the eastern division would cost the people of this country not less than $180,000,000. If I were to make an estimate to-day I would be inclined to increase rather than diminish it. The western division, roughly speaking, will cost $100,000,000. So you have altogether an expenditure of $280,000,000 upon this road in one way and another. This does not include the seven years' interest which we are to pay without recourse in respect of the mountain section. In the first place you have, on the western division, the government of this country contributing a bond guarantee and a loan amounting in all to $76,658,000, and making an actual cash contribution of $13,413,750, and you have the Grand Trunk Railway Company contributing a bond guarantee, roughly speaking of $28,750,000.

Now] take the whole road. As far as the whole road is concerned its probable cost will be about $280,000,000. Of that this country provides in cash contributions or by bond guarantees about nine-tenths, as I estimated in 1903-4, and the Grand Trunk Railway Company contributes about one-tenth and that in the shape of a bond guarantee with no cash contribution. That, then, is the proposition which the government makes to us to-day.

Let us now look for a moment at one item in connection with the information that the hon. Minister of Finance has brought down. When the Prime Minister asked us in 1904 to depart from the terms of this contract as it had been agreed upon in 1903 by those representing the Grand Trunk Railway Company with respect to the stock issue, and when he asked us to permit the Grand Trunk Railway Company to dispose of the stock, what was the reason assigned? In case my right hon. friend has forgotten I will remind him of the view which he took at that time. I will read from his remarks at page 2483 of 'Hansard.' He said:

The reason for inserting this condition ofthe contract last year was that we wished to prevent speculation in the stock. Well, Mr. Chairman, the Grand Trunk Railway Company must raise money to carry out this enterprise. They cannot build the section from Winnipeg to the Pacific coast simply upon the guarantee of the government, for that will cover only three-quarters of the cost of constructing this part of the road. And then the equipment of the road is also to be raised from the public, and there are only two manners in which that can be done, either by the issue of bonds, or raising money on their stock. The methods we have adopted will enable them to go into the money market and obtain some money with which to carry on the work.

To the same effect was the language which is to be found at page 3037 and 3038 of ' Hansard,' and which emanated from the then Minister of Justice, now Sir Charles Fitzpatrick. Speaking of the bond issues which the Grand Trunk Railway Company must guarantee he said:

Can it be expected that it will realize more than 80? Where is the amount required to make it up to 100 to come from? It can come out of nothing but the company's capital. Where are they to obtain money to provide, for instance, for terminal facilities, and to provide the thousands of miles of branch lines which they have to construct? Where is that money to come from except from the $45,000,000 of capital ?

The Minister of Finance, although not in such explicit terms, presented the same view to this House, namely, that the Transcontinental Grand Trunk Railway Company must be permitted to depart from the contract of 1903 and be empowered to dispose of its stock in order that it might, by means of the sale of its stock, obtain the money to carry out its enterprise. The position to-day is exactly what we predicted in 1904, and every dollar of that $25,000,000 of common stock has been handed over to the Grand Trunk Railway Company for a purely nominal consideration. By the agreement, submitted to us to-day the Grand Trunk Railway Company have become possessed as absolute holders of $25,000,000 of the common stock of the Grand Trunk Pa-

cific, and so far as cash is concerned they have given as consideration for it just about $200,000. And that is sought to be justified by the printed information which the Minister of Finance has brought down, and which at pages 14 and 15 recites the aid given by the Grand Trunk Railway Company to this enterprise, and provides as follows :

2. The Pacific company will forthwith issue, as paid up stock, shares of the common stock of the Pacific company of the par value of $23,908,000, making with the shares described in the schedule hereto a total of 249,000 shares of the par value of $24,900,000, and will allot and hand over the same to the Grand Trunk Company or their nominees, and that such issue and allotment of stock shall be binding upon the Paoifio company and that such stock shall not be assessable for calls.

The position therefore is that the Grand Trunk Railway Company, providing $28,000,000 of the bond guarantee out of a total cost and expenditure of $280,000,000 which this road will entail, are to receive for that assistance so given $25,000,000 or thereabouts of the common stock of the Grand Trunk Pacific, and, the people of Canada providing the balance, or nine-tenths of the whole expenditure and guarantees are to receive absolutely no share whatever in the future profits which may result from this enterprise, when, the mere influx of population and the progress of the country shall have made this $25,000,000 of common stock worth 100 cents or perhaps 150 cents on the dollar.

Under these circumstances I conclude by saying to the Prime Minister and to his Minister of Finance: You have stated in considerable detail and with the utmost frankness what you propose to do for the Grand Trunk Railway Company which has assisted this enterprise to the extent I mentioned ; but will you tell us, having regard to the $250,000,000 or the $260,000,000, which the people of this country are putting into this enterprise either in cash or bond guarantee, what are you going to do for the people of Canada? Surely it is reasonable that we should know that. I say to the right hon. gentleman and to his Finance Minister: You have told us what you are going to do for the Grand Trunk Railway Company, will you please tell the House and the country what you propose to do for Canada?

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LIB

Frederick Forsyth Pardee (Chief Government Whip; Whip of the Liberal Party)

Liberal

Mr. FRED. F. PARDEE (West Lambton).

Mr. Speaker, I have listened with attention to the pessimistic remarks of the leader of the opposition, but I am bound to say that I have not been able to discover whether he is in favour of the Grand Trunk Pacific enterprise or against it. I should rather think he is not in favour of it, although when in 1903 this project was first proposed , Mr. R. L. BORDEN.

to parliament the unanimous opinion was that another transcontinental line was necessary, the only difference being as to the question of the route, the government proposing one route and the opposition an-other. In view of the very vigorous policy of immigration which had been carried on, settlers were flocking into the western country at a rate greater than ever before, and in the year 1903 became an absolute necessity, as all conceded, that there should be another transcontinental railway. If such a railway was necessary in 1903, how much more necessary is it not in 1909, irrespective altogether of any question of cost. We hold out inducements in all parts of the world for immigrants to settle in the west, and we have rich and fertile lands to offer them. It is a mere axiom to say, that no country can be great without population, and having population it follows that you must give them ingress and egress to and from the country and that you must provide facilities for the transportation of their products to the market. What was the position in the Northwest in 1903? By reason of the insufficiency of the transportation facilities the crops were lying rotting in the fields.

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?

Some hon. MEMBERS

Oh.

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LIB

Frederick Forsyth Pardee (Chief Government Whip; Whip of the Liberal Party)

Liberal

Mr. PARDEE.

That is a positive fact. The crops were there, they could not be moved to the market and as a corollary the stores of the merchants were empty because the crops being unsold they could get no money from the farmers to enable them to purchase goods.

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Some hon. MEMBERS

Oh.

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LIB
?

Totals .. ..

" 81,859 904

1908.

50.269.000

44.711.000

17.093.000

Total $650,793,131

Or our total trade in 1908 exceeded that of 1903 by $175,787,650. Our revenue for 1908 was $96,000,000, as against1 $66,000,000 , in 1903, and I wish to point this out that in 112,073,000 ' 1903 the crops, although cut, could not be

harvested, and consequently lay on the ground and came to no good. But at the end of February, 1909, the crops in the hands of the farmers of Manitoba, Saskatchewan and Alberta were as follows:

Wheat, 17,391,000 bush., or a percentage of 18 -93 Oats, 44,125,016 bush., or a percentage of 45 -93 Barley, 7,722,000 bush., or a percentage of 33 -68

Could anything more than that set of figures emphasize the fact, that in so far as this country is concerned, transportation is an absolute necessity?

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CON

Frederick Laurence Schaffner

Conservative (1867-1942)

Mr. SCHAFFNER.

Does the hon. gentleman mean to say that grain was in the hands of the western farmers on that date in February, because there were not transportation facilities to get it out?

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LIB

Frederick Forsyth Pardee (Chief Government Whip; Whip of the Liberal Party)

Liberal

Mr. PARDEE.

Very largely.

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CON

Frederick Laurence Schaffner

Conservative (1867-1942)

Mr. SCHAFFNER.

The hon. gentleman is absolutely mistaken.

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LIB

Frederick Forsyth Pardee (Chief Government Whip; Whip of the Liberal Party)

Liberal

Mr. PARDEE.

Well, I am not in accord with my hon. friend. A very great portion of that amount would have been marketed had there been transportation facilities to carry it out. There is just one more set of figures I desire to give the House, and that is the acres under cultivation in the prairie provinces in 1903 as compared with 1908. In 1903 there were under cultivation 4,576,200 acres and in 1908, 10,000,000, or more than double. These figures show that although hon. gentlemen opposite argue, as the hon. the leader of the opposition has done, that this great national work was conceived in haste and carried out for political purposes, there is not one iota of evidence to substantiate that argument. Instead of being conceived in haste this enterprise was fully considered by the government and its pros and cons gone into on every side. How hon. gentlemen opposite can claim it has been made a political factor, is something I cannot understand. Why should it be a political factor, except in this sense that the people are willing to give credit to any government which will show sufficient courage to carry out a great national undertaking irrespective of the carping of a few? The people appreciate what the National Transcontinental Railway may accomplish, provided it be given a fair chance and not be hampered at the outset. Take that section which runs through the northern portion of Quebec and Ontario. Has any one so absolutely little faith, after what we know that northern country has produced, as to say that when the northern portion of the province of Quebec has been exploited, wdien it has a population which can develop its minerals and forests, when it has populous centres this railway will not be a benefit to the whole community? can only test these matters by comparison. We know that a few years ago the little province of Ontario Mr PARDEE.

projected the railway known as the Temis-kaming and Northern Ontario Railway. What was the stand taken by the doubting Thomases of the opposition party in the Ontario House at that time? Did they approve of the work? Did they say go and develop this unknown country? Were they satisfied with the surveys? No, they said that the railway ought not to be built. But the government of that day, under the hon. Geo. W. Ross, had the courage and patriotism to build it. That railway, built for 250 miles, has cost the people of Ontario $15,000,000. But just consider what it has done for that northern country. It has opened up a mineral country the greatest in the known world. Is there any one who will say that the people of Ontario made an unwise expenditure when they built this road? Or will hon. gentlemen opposite be strong enough to say that they were wrong and that we were right? Probably the same coniditions prevail with regard to our National Transcontinental line. Take that line from Lake Abitibi right across to the eastern boundary of Manitoba, and what do you find?

We know,' from the surveys that were made for the purpose of affording information to the Ontario government, that practically along the whole line that railway skirts a mineral ridge. Who can tell what that may contain? That great north country was not put there for nothing. It is found that, in so far as men have exploited it, it has yielded us more riches than any other portion of the country has yielded in the same time. Why should not the same thing take place here? This railway skirts the sixteen million acre belt of clay that is as good land as lies out of doors. And, if you take this land even as worth only $1 an acre, in its raw state and without any of the advantages of civilization, are you not well repaid? But there is one thing we have not taken into consideration in regard to this line and in regard to that portion of the country through which it runs from Abitibi to the eastern boundary of Manitoba, and that is that along that line there are pulp-wood forests estimated to contain 300,000,000 cords of wood. Take that even at the low rate of $2 a cord, and how much have you done to open up a vast field of profit for the whole Dominion and especially for the province of Ontario? So, I submit, as I said in starting, you must not consider one portion of this line alone, but must remember that every portion is indissolubly linked with the others, that the work is in every sense

a national undertaking and benefits one portion of Canada as much as another. Even if you take the line in the older portions of Ontario and Quebec, you find that it opens up trade, that is

bound to go to manufacturing centres and must inure to the great benefit of the manufacturers of the whole Dominion. So, with the figures we have showing the tremendous increase in every way that' has taken place in the Dominion of Canada, the government of the Dominion was absolutely justified in projecting the National Transcontinental Railway; they are justified in every possible way in giving it such aid as is necessary for its completion. They are not only justified on the figures, but they have received two absolute mandates from the people of Canada, which they are bound to carry out.

At six o'clock, House took recess.

After Recess.

House resumed at eight o'clock.

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PRIVATE BILLS.

CEDARS RAPIDS MANUFACTURING COMPANY.


House in committee on Bill (No. 94) respecting the Cedars Rapids Manufacturing Company.-Mr. Boyer. On section 1: Mr. PUGSLEY moved that the word 'fourteen' be struck out and the word 'eleven' substituted, so as to make the extension to 1911 instead of to 1914. Motion agreed to. Section as amended agreed to. Bill reported, read the third time and passed.


KOOTENAY AND ARROWHEAD RAILWAY COMPANY


House in committee on Bill (No. 801 respecting the Kootenay and Arrowhead Railway Company.-Mr. Geo. Taylor. Mr. GOODEVE moved that section 1 be omitted' and the following be substituted therefor: The Kootenay and Arrowhead Railway Company shall, within two years after the passing of this Act, construct 15 per cent of the mileage of 'the unconstructed portion of the railways which it was authorized by section 7, of chapter 70, of the statutes of 1901, to construct and shall complete the said railways and put them in operation within five years, and if the said fifteen per cent of mileage is not so constructed, and if the said railways are not so completed and put in operation within the said periods respectively, the powers of construction conferred upon the said company by parliament shall cease and be null and void as respects so much of the said railways as then remain uncompleted.


LIB

William Pugsley (Minister of Public Works)

Liberal

Mr. PUGSLEY.

What is the difference between the amendment and the section in the Bill?

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CON

Arthur Samuel Goodeve

Conservative (1867-1942)

Mr. GOODEVE.

This amendment is the usual clause adopted by the Railway Committee, but instead of putting 15 per cent of the capital it inserts 15 per cent of the mileage. The reason for that in this particular Bill is that a portion of the road has already been constructed.

Section as amended agreed to.

Bill reported, read the third time and passed.

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GRAND TRUNK PACIFIC LOAN.


House resumed consideration of the proposed resolution of Mr. Fielding with respect to a certain loan to the Grand Trunk Pacific Railway Company.


March 30, 1909