May 12, 1916

LIB

Frank Oliver

Liberal

Mr. OLIVER:

When the committee rose at six o'clock the Solicitor General was speaking. Does he wish to continue his remarks?

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CON

Arthur Meighen (Solicitor General of Canada)

Conservative (1867-1942)

Mr. MEIGHEN:

There are some remarks I wish to make, 'but I do not think it would be of any great advantage to make them at the present time.

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LIB

Frank Oliver

Liberal

Mr. OLIVER:

I wish to say a little in regard to the general proposition that is before the committee and then to speak in regard to the vote of $8,000,000 in aid of the Grand Trunk Pacific Railway Company, which, I understand, is the particular item under discussion. I find my principal ground for criticism in the fact that has drawn so much commendation to the Government from the hon. member for Brantford (Mr. Cockshutt), and, I think, from the hon. member for South York (Mr. W. F. Maclean), namely, that the Government is now about to appoint a commission for the purpose of arriving at a policy to deal, either with the railroad situation created by the Grand Trunk Pacific and Canadian Northern railways, or perhaps with the whole railroad problem of the Dominion. Whether it is the one or the other, I want to say that I cannot join my friends in their commendation of the Government policy because I consider it not a policy, but a lack of policy. I do not favour Government by commission; I am for responsible Government in this country, and I take strong exception to the fact that this Government, since it has attained power, has adopted the principle of Government by commission to a degree that was never before dreamed of in this country nor, do I think, in any other self-governed country. There are circumstances and occasions when the appointment of a commission to deal with a special, or peculiar, or little understood question is desirable, but I submit that the question of how this country is to carry the responsibilities now resting upon it because of these two great transcontinental Tailroad enterprises, the Canadian Northern and the Grand Trunk Pacific, is not a proper subject for the appointment of a commission. This subject is of such a gigantic character; it is of such immediate importance to this country, that it must be dealt with by the Government of this country as a matter of policy and administration. It would be, in my opinion, as reasonable for the Government to place in the hands of a commission the administration of its affairs in connection with the war as it is to place in the hands of a commission responsibility for the direction of the government of the country in regard to these two great railroad enterprises. If the Government is a Government for the purpose of directing in any measure the important affairs of this country, this is certainly the most important affair that at the present time can come under its consideration'', aside from measures looking towards the prosecution of the war, and for the Government not to discharge those responsibilities but to side-step-I do not use the word offensively-its responsibilities by the appointment of a commission, is not a credit to the Government; it is not a credit to the country; it is not responsible Government. This Government have been in power since 1911, and the problems connected with the completion and maintenance of these two railroads met them when they entered office; those problems have been before them every day since they entered office, and they have been in office now for a matter of nearly five years. Who, in all the wide Dominion of Canada,

should know by this time what ought to be the policy in regard to these two railroads if not the members of the Government of Canada, assuming that they are discharging their duties and responsibilities?

When gentlemen who now form the Government sat in opposition, I was from time to time very much astonished to hear the present Prime Minister (Sir Robert Borden) and his Minister of Trade and Commerce (Sir George Foster), then respectively leader of the Opposition, and bis first lieutenant, argue, in good set terms, that the condition of the country was net a matter of Government responsibility. I have heara tuern argue that if the country was prosperous that prosperity was not properly due in any important degree to the policy of the Government, but was due to the industry of the people, the bounty of Providence, and to the opportunities afforded by the country. I did not' take the argument seriously then, I assumed that it was merely a form of words used to cover up the evident fact that the policy and administration of the Government of that day had resulted in vast benefit to the country and its people, and that this was the only argument that our friends of the Opposition at that time, discharging their functions as critics as was their proper duty, could put forward to minimize the facts that were in the plain sight of everybody and of which everybody was receiving the benefit. But, if we are to take the facts as they are today-this policy of government by commission, and particularly the proposal that this great railroad question shall be dealt with, and presumably settled, by a commission-I can only conclude that our friends opposite were absolutely honest and believed what they said when, in opposition, they declared that the policy of the Government was not an important factor in securing the wealth of the country. That would be in line with their attitude to-day. They have declined to assume responsibility for the condition of these two great railway enterprises with which is interlocked to such a tremendous degree the welfare and progress of the country. I take the position that the Government of this or any other country, its policy and its administration, cannot fail to have an important effect upon the well-being of the country. And, if I may be permitted to take the time, I wish .to draw the attention of the committee to certain facts as they appear to me, concerning the policy and administration of the Government, [Mr. Oliver.!

which have led up infallibly to the present conditions in regard to one enterprise-the Grand Trunk Pacific-which we have to deal with to-day, and which the Government proposes to deal with by appointing a royal commission.

The Government was well aware, when taking office, of the character, purpose, and magnitude of the Grand Trunk Pacific enterprise, speaking of it as a transcontinental railway proposition, They knew its purpose; they knew approximately what its cost would be; and they must have realized how it was expected1 that the purpose would be achieved and how the difficulties that stood in the way of the achievement of that purpose were to be met. It would be absurd to suggest that such an enterprise as a transcontinental railroad could be completed without difficulty, or with absolute certainty as to what the result would be. These hon. gentlemen must have realized, if they realized anything, that, the enterprise having been entered upon and carried forward, as it had been carried forward with a certain definite purpose, that a responsibility in regard to it rested upon them, and that it was for them to make their decision either to carry that enterprise through to completion, with the intent of fulfilling the purpose for which it was instituted, or, in the alternative, deciding what other course they were going to pursue, and taking the responsibility of pursuing that course whatever it might be. But it appears to me that they did neither the one thing nor the other. In the discharge of the functions of government, even as they understood it, they were bound to fulfil the obligations entered into by their predecessors. And they were under equitable obligation to see carried out the contact for the construction of the Transcontinental. But, at any time, in the exercise of their sovereign authority, they could have altered the conditions to meet whatever line of policy they saw fit to pursue. They did not see fit to introduce any different line of policy in regard to this enterprise, they apparently decided to carry it forward, or to allow it to be carried forward, or to assist in carrying it forward, to completion. But the completion of a line of railway from Prince Rupert to Moncton was not a result, it was only a step in the fulfilment of a purpose, that purpose being to further the occupation and development of the country at large, without which, beyond any question, the vast investment of capital

in that tremendous enterprise must prove, measurably or entirely, unremunerative and the enterprise itself be discredited to that extent. When the Grand Trunk Pacific project was launched before the conn-try, the country had not traffic to provide interest upon its proposed enormous capital cost. The project was launched with the expectation that by the time it was completed the country would have advanced in development, in occupation and in production, to the degree that the enterprise would find traffic and yield profitable results.

When hon. gentlemen opposite assumed the responsibilities of government, having this enterprise on their hands, they did not pursue a policy of looking to the further development of the country, to that increase of occupation and promotion of trade that would naturally provide the traffic that would make the road profitable, and to create which the road was built. It is true that they carried out the project so far as securing the laying of the rails was concerned. But that was not the project; it'was only a step towards the achievement of the project, and while they took that step they refused to take any of the other steps that were necessary to secure the success of the enterprise.

From the day the Grand Trunk Pacific enterprise was launched in this House, the party in Opposition at that time, headed by the present Prime Minister, in season and out of season, by day and by night, in winter and in summer, on tlje floor of Parliament, in the press, and on the hustings, used whatever arguments they were capable of and every influence at their hand to discredit that enterprise in the eyes of the people of Canada and in

the eyes of the world at large.

No opportunity was ever lost by the then Opposition to discredit the Grand Trunk Pacific transcontinental railway enterprise in the minds of the people of Canada and of the people of the world at large. When they attained power and when they decided to continue the material completion of the project, it would have been reasonable that they should have reversed their policy in regard to the enterprise. They did reverse their policy in regard to other matters, and I do not know that they are to be seriously criticised for having done so. Consistency is the virtue of small minds, I believe it has been said, and I am sure that on that ground our friends on the other side could not be accused of being

small minded. But in this particular they maintained the virtue of consistency, and the same policy of destructive criticism that was the policy of His Majesty's loyal Opposition up to 1911 has been the policy of His Majesty's Government from September 21, 1911, until the 'present day, May 12, 1916, when the Solicitor General, not three hours ago, stood up in his place in Parliament and spoke of the Grand Trunk Pacific Bailway-I forget his exact words, but the idea was that it was a mad enterprise. How the people of Canada or this Government could expect that that stupendous enterprise, which depended upon the maintenance of its credit in the money markets of the world and in every other way, could thrive under such conditions, is certainly a mystery to me. The world knows that the enterprise depended upon the support of the Government of Canada. It was an enterprise in large measure of the Government and of the people of Canada, and when those who were more recently charged with the responsibilities of Government of the country decried the enterprise in every possible shape, form and manner from the day they took office as in the years before they attained office, surely they must have realized that even if they did stand by the actual contracts that had been made, which required that the rails should be laid for a certain mileage, they were destroying the enterprise just as surely as if they had refused to lay those rails. It may be that they did not know what they were doing. It is not for me to say whether they knew or did not know, but in either case the responsibility rested upon them, and to-day we are facing the results.

In the matter of the construction of the railway, I have said that they carried out the contracts that they found when they came into office. They did in some measure, but only in some measure. The rails are laid from Prince Bupert to Moncton, but the contract required that there should be terminal facilities at Quebec, which was the great Atlantic port of this great Transcontinental railway. When the time came that the rails had been laid and it would have been possible to transact business over those rails through that great Atlantic port of Quebec, were terminal facilities available there? No. How did this Government expect that the Grand Trunk Pacific Bailway Company were to handle the business of half a continent through an ocean port that did not have any terminal

facilities for the accommodation of their iraffic? This question arose two years ago and it was thrashed out in the House. The Minister of Railways and the Solicitor General argued that the Government had completed its contract with the company, that the company was now called upon to take over the road, that the road was completed. At the very same time that these gentlemen were standing in their places and asserting that the road was completed, the House was asked to vote the sum of $5,000,000 for expenditure on construction on the Transcontinental. The position is so absurd that it is only taking up time to dwell upon it. This Government was a party to laying 1,352 miles of rails from Winnipeg to Quebec. When the rails were laid and the $150,000,000 or $200,000,000 of expenditure made of which they complained so long and so loudly, they had not provided the means or facilities for handling traffic over these rails at the Atlantic port that the whole expenditure was made for the purpose of reaching and doing business at. A year has gone by since that time and we passed the other day an Estimate of $1,500,000 for construction on the Transcontinental. The Government made a bargain -wisely or unwisely, . never mind-they made a bargain with the railroad company that when that road was completed the company would' take it over and operate it on certain terms. The road has not been completed, and the company, in justice, as they set forth to their investors, are not able to accept an uncompleted road as a completed road. They are not able to take it over, and the condition is that more than two years after the last rail was laid, that road is not in a position to do business at the port of Quebec.

When the Grand Trunk proposal was placed before Parliament in 1903 by the then leader of the Government in the eloquent terms that he is so competent to use, he used the expression, in launching the enterprise, " Pray Gqd that it be not too late." This expression has been the cause of vast merriment, and of a large measure of sarcasm from that day to .this. But from year to year the railroad was pushed forward, and up to 1911 the production, upon which the success of the enterprise depended, was increased from year to yeaT. Had that increase of production been continued up till the present time, there would have been, not only ample traffic for the railroad to enable the company operating it to earn interest on the

[Mr. Oliver.!

cost, but such a pressure upon it that there would have been ample demand for the second Transcontinental railway. Unfortunately-and I will deal with that feature of the case a little later, if I may-production did not continue to increase under the benign policy and administration of our friends who occupy the treasury benches. It was not because the sun did not shine, or because the rain did not fall, or because the grass did not grow; it was because the policy and administration of the Government of the day prevented the producers of the West from securing that return for their labour to which they were entitled, and which they could have secured by the scratch of the pen of the Prime Minister of this country.

War broke out. That was a time when it was desirable that Canada should have ample communication from coast to coast, when it should have access to all ports, and' means of transport for her produce under the most favourable terms, for her produce for export, as well as for her imports. It was a strange coincidence; in fact, it was a set of circumstances that synchronized with the needs of the Allies, then at their height, when Providence blessed our country with the most .magnificent crop ever known in its history. We had in the Prairie West, without any very large increase of productive acreage, an enormous increase in natural production of export grain because Providence, was kind to us and gave us a return for our labours such as we had never expected and had never seen before. We had a crop of something like 350,000,000 bushels of wheat, oats to correspond, and barley to correspond, and the great need of the prairie farmer, of the prairie west, of all Canada, was that the grain should get to market and be turned into cash to be returned into the channels of trade throughout the Dominion in order that our people might receive the maximum benefit from it. We had the rails on the Transcontinental, built for the express purpose of coping with such a contingency, laid to-Quebec, to the ocean port. Thank God, it was not uoo late, so far as getting the railroad* constructed to tide water was concerned. Providence was not in fault in the matter. Providence had given a good* crop. The people of Canada, to their credit, had -supplied the money to build a railroad, but the Government of Canada, in control of the affairs of the people of Canada, did not see to the operation of that railroad.

so that the crop so produced could get to market and be returned in cash for the benefit of the people of Canada. Whose is the responsibility if to-day we have 125,000,000 bushels of wheat for the overseas market in this country at the present time. With a railroad built at a cost of $200,000,000, to give the shortest possible route under the best possible circumstances from the wheat fields to tide water. Over that road this year, when we had this tremendous crop, and two years after the last rail was laid, out of 350,000,000 bushels, we have hauled to the port of Quebec, it is claimed, but disputed, 3,000,000 bushels. I insist, Mr. Chairman, that this is not the fault of the Grand Trunk Pacific railway enterprise. It is not the fault of the Liberal Government that instituted it. It is not the fault of Providence, and it is not the fault of the country. It is not the fault of the war; it is the fault of the Government that did not realize its responsibilities and the possibilities of the enterprise, or at any rate, that did not use the proper means to realize on those- possibilities. Today our crop is still back in the country, we are without the money, the difficulties of getting across the ocean are increasing from day to day, and the responsibility is on the treasury benches.

We have heard to-day from the Solicitor General in terms that surely his colleague, the Minister of Finance must have regretted to hear him use, if he has considered how far his comments can reach in discrediting a great financial enterprise of this kind when we all appreciate that our enterprises need bolstering up instead of knocking down. We are asked to believe that this enterprise has not within it the elements of success, and we are told that its earnings during the past year have been limited to such a degree as to show that success is not possible. The Grand Trunk Pacific, as distinct from the Transcontinental railway, was intended to connect lake Superior with the prairies and then the Pacific coast. In order that the Grand Trunk Pacific in the prairies might be connected with lake Superior, a railway connection of 200 miles was built by the Grand Trunk Pacific connecting with the Transcontinental at a point about 250 miles out from Winnipeg. While the company would take advantage of direct connection between the wheat fields and the Atlantic port at Quebec, it would also have the advantage of direct connection between the wheat fields and the great lakes at Fort William.

For many years the Canadian Northern

had that connection and did business over it with great success. Ever since the inception of the Canadian Pacific, that company has done business over that route with great success. It was an essential part of the project of the Grand Trunk Pacific that it should have an independent outlet on lake Superior and it spent the money of its shareholders, and raised money on the credit of the company, in order to build 200 miles to make that connection. A year ago the crop was light in the West and traffic was light. When the business was not there the most capable management could not earn money. Then this Government come in and they say to the railway company: If you do not take over this uncompleted line between Winnipeg and Quebec, do not take it over in its uncompleted condition, and do not take it over on the terms we dictate, we will cut you off at Winnipeg from access to lake Superior as well as from access to Quebec. And they did it. To-day the Grand Trunk Pacific, that should have had its outlet on lake Superior and should have had the benefit of that outlet, having spent an enormous amount of money in constructing terminals there, providing elevator accommodation and in other ways to enable it to carry on trade on that lake in the past year, when there was abundant traffic, when there was more than abundant traffic, has been denied the opportunity to share in that traffic to the extent of one dollar. The Government took over theii traffic at Winnipeg and shut them out from the earnings of upwards of 450 miles of' road. Then the Solicitor General asks why the Grand Trunk Pacific did not earn as much in proportion as the Canadian Northern. The Canadian Northern, or any other road, would not earn satisfactorily if it. was- broken off 450 miles before it reached the terminals to which it was endeavouring to carry its traffic. The Government broke the back of the Grand Trunk Pacific when it took away from it the connection that it had to lake Superior and where it had-established its own terminals- at its own cost. It did that at a time when the company was at a disadvantage owing to the light traffic and the small crop and did it under the plea that the company was not dealing honestly by the Government in not undertaking to operate the line to Quebec when the Government had not honestly completed the line and fitted it for operation.

The three great points in the eastern operation of the Grand Trunk Pacific en-

terprise were: access to the head of the lakes at Fort William, aoce&s to the ocean at Quebec and access to the great distributing and collecting system of the Grand Trunk Railway Company throughout the eastern provinces. Nobody would have been mad enough to undertake to push a great railway enterprise only from Winnipeg to the Pacific coast. Such a road would have been a local road, a colonization road, and certainly no euch expenditure as was made on the Grand Trunk Pacific would have been warranted in euch circumstances. Had it been the policy of the Government to organize, or encourage a company that would give colonization railway facilities throughout the Prairie West from Winnipeg to the Rocky mountains, then each mile of road would have been constructed for half or a1 quarter of what the Grand Trunk Pacific main line cost. But, that was not the enterprise. The proposition was that they should build the Transcontinental Tailway from Quebec to Prince Rupert with an even grade and of as high a standard of construction as could be secured and such as no other transcontinental railway had. It was only as a transcontinental enterprise that this vast expenditure was warranted, and when our hon. friends broke the back of the enterprise, took over the operation of the road from Winnipeg to Quebec and from Winnipeg to Thunder Bay, absolutely disconnected the Grand Trunk system in the eastern provinces from the Prairie Provinces in the West, there was nothing to it; they had destroyed the enterprise just as absolutely as if they had refused to lay the rails between Cochrane and Quebec.

Then they come to the House and say: " We need $8,000,000 as aid to this broken backed railway, this bankrupt concern. We do not know what to do with it, so we are going to appoint a commission to tell us what is the matter and see what we are to do with it." These are the facts of the case and no commission is necessary to tell what has happened to the Grand Trunk Pacific up to the present time. No commission is necessary to tell what must necessarily have happened to it under siuch direction and control. There was no possibility, it having been diverted from its original purpose and that purpose having been absolutely destroyed by the intervention of this Government, of its success as a commercial undertaking.

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CON

William Thomas White (Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir THOMAS WHITE:

Does my hon.

friend suggest that the Government pre-

vented the Grand Trunk Pacific from operating the National Transcontinental?

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LIB
CON

William Thomas White (Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir THOMAS WHITE:

And took away the section from Fort William to Cochrane?

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LIB
CON

William Thomas White (Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir THOMAS WHITE:

Does not my hon. friend know that the Grand Trunk agreed to that and was glad to?

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LIB
CON

William Thomas White (Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir THOMAS WHITE:

How, then, can he accuse the Government of breaking the back of the Grand Trunk Pacific by taking away that branch?

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CON
LIB

Frank Oliver

Liberal

Mr. OLIVER:

Certainly; they had to agree to whatever the Government insisted upon. And when the Government was hostile-deliberately, publicly, avowedly and aggressively hostile to the company-what was there to be done but to submit to any terms the Government saw fit to dictate? There was no other recourse. The Grand Trunk Pacific had to come to this Government to enable them to complete the line to the coast. My hon. friend 9 p.m. has thrashed out that point time and again in the House, and explained how it was necessary. Well, the Grand Trunk Pacific cannot come to the Government and ask as a favour a certain concession, and then refuse the Government a concession it may see fit to insist upon. We do not need a commission to tell us that.

I am sorry the Minister of Trade and Commerce is not in the House, because I am going to refer again to a subject to which he takes strong objection-the question of free wheat. I have said that the production of the prairie west made a continuous increase from year to year up to 1911, in which year it reached its maximum for the time being. In 1911 there was a big crop, but harvesting conditions were unfavourable, and it became necessary and desirable from every point of view that as much as possible of that crop should be marketed south of the line. The Government had been newly returned to power on a policy opposed to the marketing of grain south of the line, and therefore they were absolutely consistent in their policy when they re-

fused to permit of that marketing south of the line. But the fact that they had refused to permit it cost the producers of western Canada figures that ran into tens of millions; and that refusal absolutely broke the back of production in the West. It was not that Providence had not given a good crop; it is true that Providence had given bad weather for harvesting, but the Government could have saved the situation in a large measure if they had seen fit to do so. But they would not do it because it was against their policy of trade restriction and of opposition to the movement of our grain south of the line. The year 1912 showed no increase in either acreage or crop; the year 1913 showed no increase in either acreage or crop. The year 1914 showed a substantial decrease in both acreage and crop; that, however, I will admit was in a large measure the result of climatic conditions. But before that we had had two years of stagnation, so far as production was concerned, absolutely as the result of the policy and administration of our friends opposite-years when we should have been increasing our production so that when these great transportation enterprises were completed there would be business for them to do at a profit both to them and the people depending upon them and to the country. The Government was opposed to grain being transported south of the line. It ought to go east, they said, and not south, and so they would not let it go south. And when the railroad is completed to the east, when the rails are laid and the trains running, we find, four months before the next harvest, surplus grain to the amount of 125,000,000 bushels still not having gone east, still not having gone south, still in the elevators of the West or in the farmer's hands. As their policy was to keep the grain from going south, on the plea that it ought to go east, they ought at least to have sent it east when they had the railroad to send it over, and when theirs was the responsibility of seeing that it found a market in that direction. They are now going to appoint a commission to tell us how to finance or manage or administer the Grand Trunk Pacific and the Canadian Northern Railway If they do not know now what is the cause of the present situation, no commission that they appoint will ever tell them, because the men they appoint will be like-minded with themselves, will hold the same point of view, and bring in a verdict accordingly. It is suggested that the 244

solution of the problem is Government ownership. Well, if that is the proper solution it is just as good to-day as it will be a year from now. What I complain of is that the Government is demanding over $8,000,000 to tide over the situation for one year, without any suggestion as to what is to be the situation after that $8,000,000 has been spent.

Coming now to another aspect, there is one condition under which Government ownership is desirable and necessary, and that is where any public utility is in the hands of a monopoly. If we had only one railroad operating in Canada we would surely need Government ownership to introduce competition. But I maintain that the difficulties of working out the problem of Government ownership satisfactorily are such that it is better not to undertake it unless it becomes a necessity. Our experience in Government ownership of railroads in Canada has not been fortunate. We have had Government ownership of the Intercolonial for many years. We complain that the Canadian Northern Railway and the Grand Trunk Pacific are not able to pay interest on their bonds; we call theml lame ducks and broken-backed enterprises! They are injuring the credit of our country; they aTe a discredit to the men who conceived the enterprises and who carried them on, because at this time, they are not able to pay interest on their bonds! My information is that the Intercolonial railway has never yet paid a cent on its cost of construction; that it has never yet come anywhere near doing so; that from year to year and year after year the cost of operation has been met by appropriations out of the public treasury. While that may not be the condition to-day, there is no doubt that it was the condition for many years, and I say that until under 1 Government ownership it has been demonstrated that we can earn some part of the interest upon the cost of construction of the Intercolonial, we are hardly the people to undertake lightly the project of managing such a vast network of railway systems as is involved in taking over the Grand Trunk Pacific and the Canadian Northern, which, if we are not able to manage them better than those who are now in charge are doing, and far better than we ever managed the Intercolonial, instead of lightening our burdens, are going to increase them vastly. Government ownership is an ideal condition. I have said-and I say it again foT the bene-

fit of my hon. friend from South York (Mr. W. F. Maclean) who did not hear it before -that it is only in the case of a private monopoly of any public utility that Government ownership becomes a necessity; but so long as private enterprise can be maintained in effective competition, my opinion, as the result of our experience, is that we are better off without Government owner- ship than with it.

Mr. W. F. MAiCLEAN: What will you do with the roads on your hands now?

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Frank Oliver

Liberal

Mr. OLIVER:

I have been trying to explain to the Government how they have fallen down in regard to that matter, and I would suggest better management in that case. The difficulty of Government ownership is briefly this. In order that any enterprise may succeed, it must have a directing head, and that head must have a direct interest in the success of the enterprise. When the whole people are the owners of an enterprise, that direct interest is lacking; there is a diffusion of interest that does not tend towards energetic and successful management. That is the weakness of Government ownership. T speak with knowledge, because we have in Edmonton municipal ownership, which is on the same principle, and we find that difficulty.

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LIB

Frank Oliver

Liberal

Mr. OLIVER:

That may be so, but we

find a great difficulty in working out municipal ownership successfully, for the reason that I have stated. It may be that, under the direction of my hon. friend's campaign of education, and under changed circumstances, we may arrive at a point where the public mind will be so seized Of its responsibilities as to enable us to manage these matters better in the future than in the past. I hope that time may come; it has not arrived yet. My faith is based rather in effective business competition, where that can be secured; and, before I close, I want to point out that the essential features of the Grand Trunk Pacific Railway project and of the Canadian Northern Railway project, so far as the former Liberal Government was responsible for either or both of them, was that they represented effective railroad competition throughout the Dominion of Canada. It was for the purpose of securing effective railroad competition that these enterprises were severally instituted or aided by that Government.

Given that effective competition of these great utilities in the hands of men whose interests are in their absolute efficiency and success, and given a measure of Government control such as we have through the Railway Commission, and I think we have arrived at as near the ideal as- we can expect to get in the present condition of the public mind. I know it is usual to say: Government ownership is the solution of all difficulties. I do not, however, hold that tt) be the case. The railway problem is not solved by the Government assuming ownership; it is only at the beginning. I would have been better pleased if the Government had come down with a definite policy with regard to these railroads that would look to their being financed successfully during the present period of difficult finance, so that we might expect them to emerge successfully when that condition passed away. I regret that the Government has not adopted that policy because I believe it to be sound policy and the best policy. I am sorry that the Government has come down with a policy, every line and every word of which is absolutely to further discredit these two railways as business enterprises and render what formerly was difficult, now a practical impossibility, that is, to finance them further on their own account. I know that these are har'd times; I know that there are financial difficulties for the Government and everybody else; I know that we have sunk an enormous amount of money in these enterprises; I know that so far as earning their own interest to-day is concerned, they are failures; but we must take into consideration the fact that these are not the only enterprises that have failed to earn profits at the present time, and that this depression occurred-and remember that it was not due to the war condition, but to the condition before the war-at the time these roads were just completed, that is, at the most critical time in their career, because during construction all charges are carried out of capital,-but when they are completed they must be carried by the traffic, and the traffic must be sufficient to enable that to be done. Just at this particular time evil days have come and both enterprises are behind. My suggestion is that it would have been wisdom on the part of the Government to come down with a definite policy to carry forward these enterprises with a view to their becoming permanent and substantial competitive transcontinental railway enterprises for the benefit of the Dominion of Canada. That

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is a somewhat radical, a somewhat serious suggestion; but we^ are facing a serious situation, and I have confidence enough in the country and in its future to believe that if these enterprises are properly handled, they will, in due time, work out successfully. I am, however, just as sure that, handled as they have been, hampered as they have been, by the policy of the Government of the day, they cannot possibly work out to a success under a policy of Government ownership unless we have a different kind of administration from anything we have had yet in regard to railroads or any other public utilities at the hands of this Government. Just a word in regard to the progress of affairs in Canada and the possibilities of the future. When the Canadian Pacific railway was first built across the continent the population was sparse; conditions were unfavourable; traffic was light, and I remember that during many years the passenger business of the Canadian Pacific was carried on by one ' train a day each way across the continent, and that the passengers on that train were remarkable rather for their absence than for their numbers.

I remember that, years after the Canadian Pacific railway was built, it entered the minds of the great men who were managing the enterprise to build a connection between St. Paul and the main line of the system at Moosejaw-what is called the Soo line. It looked like a splendid railroad proposition, and they expected that it would bring traffic. I have seen that train come into Moosejaw time and again-it came in every day-with engine, tender, baggage-car, second class car, tourist car, first class car, and Pullman, and with one solitary passenger on all that train. Today everybody knows that the Canadian Pacific railway is probably the most successful railway enterprise in the world. The traffic of their main line is so great that they have double-tracked a large part of that line, not only on the prairie, but also in Northern Ontario as well. Their Soo line is a magnificently paying proposition. Every part of the enterprise, as they have undertaken it, has turned out splendidly. But it did not turn out that way for many years after the inception of the enterprise. Circumstances were such that it could be carried on very much more economically than a railroad enterprise can be carried on to-day. Now, throughout the Northwest, on those wide, lone prairies, where we might expect possibly to have a

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train once or twice a week-and I remember that during eight or ten years all we had at Edmonton were two trains a week, and accommodation trains at that; so-called because they did not accommodate very much-to-day, between Winnipeg, Brandon, Begina, Saskatoon, and Edmonton, and between Winnipeg, Brandon, Regina, Moosejaw, Medicine Hat, Lethbridge, and Spokane, Washington, you have railroad services that are not excelled on this continent. This is absolutely the result of competition, competition made effective by the introduction of the Grand Trunk Pacific andi the Canadian Northern railway enterprises info that country. It may seem to my hon. friend from South York (Mr. W. F. Maclean), living where railroads come in from every direction, where they are almost climbing over one (another, that we should not have railway competition, and that he can regulate railroads to run this way or that as he sees fit. But, looking at the circumstances as I see them in our country, and bearing in mind the conditions that we had under a monopoly as compared with those to-day, I say that present conditions are good enough for me. I do not want to revert to a condition of railroad monopoly, and I am not so sure that I want to see a condition of only government ownership, either.

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IND

William Findlay Maclean

Independent Conservative

Mr. W. F. MACLEAN:

Having listened to the discussion of the merits and demerits of public ownership, I still think that the arguments in favour of that system are sound and that it is the proper railroad condition for this country. I tried to make it clear this afternoon that the opportunity to bring about public ownership in this country is here, in this crisis created by the war or by something else, when we find two railroads asking Government assistance. The small attendance during this debate may be accounted for to some extent by the length of yesterday's debate lasting into this morning. But the thing that strikes me in this debate is that the Grand Trunk Railway, the Canadian Pacific Railway, and the Canadian Northern Railway, are very much afraid that we are very near the open door of public ownership in this country, and they would like to see the country get past the present situation. That situation presents itself to Parliament, and it is upon Parliament I urge that that situation should be used for the purpose of trying out the system, of public ownership. I would like to see public ownership

tried with at least one of these railroads in the East 'which has connecting lines in the West. We have the Grand Trunk Pacific on our hands, or we have to finance it; and we have the Transcontinental certainly on our hands, and are running it. We have also the Intercolonial, and are buying other lines in the East. So, I say take over one line that is profitable in the East and is linked with these lines in the West, and let us see what we can do in competition with the other roads. My suggestion was to give a sum of money-I mentioned a certain sum as a feeler-to get possession of the road. The only road that I see in immediate sight is the Canadian Northern, which, I believe, would sell its interest for a very small consideration. The suggestion I made is entirely my own. These negotiations afford us opportunity to take over a good system that affords connection with our cities in the East. And with that one road, whichever it may be that we take, we should link the great transcontinental system that will give competition with the other lines. The operation of such a road would he more effective in moderating rates in the West than anything else I know of. It would do more for the public of the West than the Railway Commission with all its powers of regulation can do. It may be that we shall be forced to take them all by our still further experience or on the recommendation of the commission that we are going to appoint. I am not going to object to that commission, and, of course, its report may be in

favour of public ownership. But I am not going to be guided by that.

I tell this Parliament again that this is the opportunity of trying public ownership, where you have a transcontinental line connecting the cities of the West with those of the East. I think the people of Canada will be rather disappointed when they know that this opportunity of getting a transcontinental system has been allowed to slip by. I should have thought that the member for Edmonton would have been prepared to accept that course at least as one measure of relief. He may blame this Government for the fate that has come to the Grand Trunk Pacific, the Transcontinental and all its alliances. That may be, but it has proved a failure and the failure having taken place and the Grand Trunk being responsible in a legal sense for what has happened, the greatest opportunity that has ever presented itself to a nation h'as .arisen, and to take advantage of

this opportunity would give us a railroad and a chance to improve conditions in this country. The conditions could not be worse than they are to-day; they could be much better. I absolutely dispute the doctrine laid down by the hon. gentleman who has just taken his seat that to get good railroading you have to have the competition of privately owned lines. The whole experience of America is against that dogma being true or justified by the facts. Seventy-five per cent of the roads in the United States have gone into liquidation; road .after road has been wrecked, by railroad exploiters, and the system has proved to be the greatest failure in the way of railroading that has been known in the history of the world.

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LIB

Frank Oliver

Liberal

Mr. OLIVER:

When the hon. member speaks of failure, does he mean financial failure, or failure as regards service rendered to the public?

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IND

William Findlay Maclean

Independent Conservative

Mr. MACLEAN:

Both. Service has not been given the public in the United States for the money invested that that money properly invested under judicious state administration would have given the public.

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LIB

Frank Oliver

Liberal

Mr. OLIVER:

For the two cents a mile that a man pays to ride in a train in the United States, does he not get better service than is given anywhere else in the world?

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May 12, 1916