October 23, 1919

LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

Does the Government pay dividends to the stockholders?

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
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UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

That is not the question.

Mr. MACKENZIE KING. That is what they are doing by this measure. That is quite different from this.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
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UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

I want to ask the hon. member again this: The Dominion Government own the stock of the Canadian Northern Railway Company with bonds against it just the same as in the case of the Grand Trunk. Will he say now that we do not own the Canadian Northern railway? He cannot say that; he knows he cannot say it. The hon. member this afternoon argued, if 1 understood him aright,-and he is doing so now-that in taking over this stock, we are not really getting government ownership. During the course of his remarks this afternoon, I must frankly say that I was waiting very anxiously to see whether he was in favour of public ownership or private ownership, but he did not commit himself. I should like to ask him now. Are you in favour of public ownership?

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
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LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

If the minister is unable to frame a policy, I am quite prepared to take the responsibility of framing one when the time comes.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

I should like to ask the hon. member another question.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
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L LIB

Georges Henri Boivin (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Laurier Liberal

Mr. DEPUTY SPEAKER:

The hon. minister is certainly not in order in putting questions to an hon. member who has already spoken and who has exhausted his right to speak.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

Have I the privilege of asking him whether he would consent to a question or not?

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
L LIB

Georges Henri Boivin (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Laurier Liberal

Mr. DEPUTY SPEAKER:

It could possibly be done with the unanimous consent of the House, not otherwise. A similar ruling was given last night by Mr. Speaker, and I must respect that ruling.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

I bow to your ruling, Sir. The only point I wish to make is this, namely, that we now have in this House a leader of the Opposition who, in my opinion, is afraid to stand up and say

whether he is or is not in favour of public ownership. As regards the present transaction, every hon. member opposite, with the exception of the leader of the Opposition, has endeavoured to impress upon the people that this side of the House in adopting the policy of taking over this road is entirely committed to public ownership. He is the only one of the whole party who is endeavouring to persuade the people now that the other members on the opposite side are all wrong; that it is not public ownership at all; that we really do not own the railway. Is it not a nice spectacle to see the leader of the Opposition in his first remarks in this House as leader take a position of that kind?

It is not a question whether the members of this House are in favour of public ownership or not; it is a question whether the Government are going to take over this road or let one of two or three things happen. I only wish that you, Sir, had not ruled that I could' not ask the hon. member one or two more questions, because I would like to know which one of these two or three alternatives he would be willing to adopt. In the first place we are face to face with this proposition, and it is all on account of the policy of hon. members on the Opposition side when they were in power, and the leader of the Opposition (Mr. King) who was at that, time a member of this House, is also responsible for the railway tangle in which we find ourselves at the present time. I will tell the hon. member why we must decide to-day whether the Government will take over this railway, not because of public ownership but in the interest of the people of this country, or, whether we will let the Grand Trunk go in another way that would prove disastrous to the Canadian people. I will tell him why we are in this trouble. The Grand Trunk railway, the Canadian Pacific railway and the Canadian Northern railway were all at one time doing well and prospering, with great futures,in this country. What happened? In 1903, the Grand Trunk wanted to get into the Great West, just to get a connecting line into Saskatchewan and Alberta. I was here at the time and I know what I am speaking about. I saw Mr. Charles M. Hays, and he declared he did not want to go further than Saskatchewan and Alberta, but the Government of that day-and the hon. member who is now leader of the Opposition was one of those responsible in the matter-insisted that the road must be built from Moncton to Winnipeg and from Edmonton to the Pacific.

The company agreed to do that and the Government of that day told Charles M. Hays, and led the people of this Dominion to believe that it would not cost this country more than, I think, some $13,000,000.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
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L LIB

Edmund William Tobin

Laurier Liberal

Mr. TOBIN:

Mr. Speaker-

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

I will not allow any more interruptions. Mr. Speaker, I want, with all respect to the hon. member to say this. I am prepared now to let him or any other hon. member on the other side of the House ask me a question if the leader of the Opposition will let me ask him one. The leader of the Opposition (Mr. King) sits quiet and makes no reply to my question.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
L LIB

Edmund William Tobin

Laurier Liberal

Mr. TOBIN:

He said-

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
L LIB

Georges Henri Boivin (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Laurier Liberal

Mr. DEPUTY SPEAKER:

Order.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
L LIB

Edmund William Tobin

Laurier Liberal

Mr. TOBIN:

I just want to put the minister right.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
L LIB

Georges Henri Boivin (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Laurier Liberal

Mr. DEPUTY SPEAKER:

The hon. member has no right to interrupt the minister, who has the floor, without his consent.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

Now let me tell the members of this House and the public just what the leader of the Opposition did to ge*' as in the railway muddle we are in at the present time.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
L LIB

Edmund William Tobin

Laurier Liberal

Mr. TOBIN:

He was not in the House then.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

He was a minister in the Laurier cabinet, and advocated his leader's policy consistently. Hon. gentlemen opposite were responsible for the building of the Transcontinental, and they told the Grand Trunk company and the people of this country that it would cost only some $13,000,000, but when they got through and were ready to hand it over to the Grand Trunk they found it had cost over $200,000,000, on which the Grand Trunk by the terms of the agreement had to pay interest in perpetuity after seven years. Was not that enough to make the Grand Trunk or any other railway company throw up its hands? The construction of the Grand Trunk Pacific was carried on simultaneously. The Grand Trunk guaranteed the bonds of the Grand Trunk Pacific believing that the late Sir Wilfrid Laurier and his government would carry out their policy. But when the Grand Trunk Pacific was completed and the Transcontinental was ready to be handed over, the Grand Trunk were faced with the liability, if they took over the road, of interest after seven years upon $200,000,000 to $217,000,000, instead of upon $13,000,000. It was impossible for the Grand Trunk to operate successfully with a

liability of that amount. The Grand Trunk was faced with a liability of $8,000,000 or $10,000,000 per annum if they operated the Transcontinental .railway, and it was absolutely impossible for them to succeed on those terms. They had also guaranteed the Grand Trunk Pacific securities to an enormous amount, and they had pledged that they would pay no dividends on the old Grand Trunk stock if the Grand Trunk Pacific did not earn the guarantees the Grand Trunk had given. They are therefore in the position to-day that they cannot pay their shareholders any dividends, if earned, until the Grand Trunk's guarantees in respect of the Grand Trunk Pacific are met, and the Grand Trunk is also liable for the deficits on the Grand Trunk Pacific. How under Heaven could the Grand Trunk live with liabilities of that amount? Yet to-day the leader of the Opposition, if I interpreted his remarks correctly, and those behind him, advocated that we keep the Grand Trunk Pacific, the Canadian Northern and the Intercolonial, and release the Grand Trunk from all of its liabilities and let it continue to operate or be taken over by the Canadian Pacific. That is such an absurd proposal that no government could accept it and remain in power.

Faced with this position, what could the Government do? It is not a question whether we want public ownership or not. We have the Canadian Northern, with its lines in Western Canada superior to the Canadian Pacific and the Grand Trunk Pacific put together. The Canadian Northern lines in that territory cannot help but pay. The Government of the late Sir Wilfrid Laurier allowed the Canadian Northern to extend its line from Port Arthur east, and this put the road practically in the same position as the old Grand Trunk, the western lines becoming liable for the amount guaranteed in respect of the extension to the east. Unless the Canadian Northern can get feeders in Eastern Canada it is in a hopeless position. The Grand Trunk Pacific from Winnipeg to Port Arthur is in a similar situation. It has no lines in Eastern Canada gathering up traffic to be taken West, Then in Eastern Canada we have the Grand Trunk system with no connections in the West, but with better facilities for gathering freight in Ontario and Quebec than the Canadian Pacific, or the Canadian Pacific and the Canadian Northern combined. Would it have been fair to the people of Canada, who have put so much money into the Canadian Northern

and the Grand Trunk Pacific initiated by the Government of the late Sir Wilfrid Laurier, for this Government to say: We

will not force the Grand- Trunk-I use the word "force "-to join up with the other roads and complete the national system? Whether the road is operated by the people of Canada or by a private corporation it will be in just the same position to compete for traffic with its rival, the Canadian Pacific. Yet the leader of the Opposition this afternoon tried, for a political purpose, if I may be pardoned for saying so, to make a certain portion of the public believe that we are taking over the road simply because we believe in public ownership. He knows that is not the case. He knows we have no alternative to taking over the Grand Trunk if we want to save that road, as well as the Grand Trunk Pacific and the Canadian Northern, and in years to come give the people of this country the cheapest freight and passenger rates it is possible for any railway to give.

The leader of the Opposition also stated that this was neither public ownership nor private ownership, but was simply transferring the road to the present management of the Canadian Northern system. Perhaps he did not say so in so many words, but I got the impression that he was trying to* lead the public to believe that we were handing the road over to Mackenzie and Mann.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
?

Some hon. MEMBERS:

Hear, hear.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink
UNION

John Dowsley Reid (Minister of Customs and Inland Revenue; Minister of Railways and Canals)

Unionist

Mr. J. D. REID:

My hon. friends say " hear, hear," which shows that I am interpreting the hon. gentlemen's remarks correctly. Now let me say to the leader of the Opposition, what I said this afternoon, that neither directly nor indirectly in any shape or form have Mackenzie and Mann been concerned in the management of the Canadian Northern or the Canadian Government railway system, and the hon. gentleman knows it. And when he or any other member of this House makes the statement in this Chamber or otherwise gives it publicity, that Mackenzie and Mann have either interfered in or discussed the operation of the Canadian Government railways with any member of this Government, from the Prime Minister down, he is making a statement that is absolutely false and unfounded. I want to emphasize that fact, because the allegation has been thrown across the floor of the House that Mackenzie and Mann were operating the road.

Topic:   GRAND TRUNK RAILWAY SYSTEM.
Subtopic:   BILL, PROVIDING FOR THE ACQUISITION OF THE SYSTEM BY THE GOVERNMENT.
Permalink

October 23, 1919