quisition of the Grand Trunk," said Sir Henry.
" It is a nasty thing to have to do at the present Juncture, but sometimes nasty things have to be done, but I am not so anxious for trouble that I wanted this thing brought on during the Victory Loan." (Laughter and applause.)
But Sir Henry argued that railway matters, Grand Trunk or otherwise, had not the slightest thing to do with meeting Canada's obligations and keeping up Canada's credit, which was the aim of the Victory Loan.
He said positively there that he would rather not have the Grand Trunk affair on his shoulders for the moment. I suppose that he was afraid of the consequences to the Victory Loan. Mr. Beatty, president of the Canadian Pacific was also present, he took up the question and I want to put before the House exactly where the Canadian Pacific stands on this question. I believe the Canadian Pacific president as fully as I believe lion, members on the other side. I quote the following:
The chairman then introduced Mr. E. W. Beatty, president of the C.P.R., who was received with cheers, and gave a vigorous expression of views regarding nationalization of railways.
" I have embraced, with a great deal of pleasure," said Mr. Beatty, " the opportunity of speaking on this loan, especially in view of the fact that elements have entered into it which render a frank discussion advisable, even though my own position in it may be regarded as -somewhat delicate and even invidious.
" I have listened to the comprehensive statement made by the Minister of Finance as to the objects of the loan, and the reasons why it should receive the support of all Canadians who have the welfare of the country at heart, and regard the sustaining of its credit as of vital consequence.
" The Minister of Finance and myself are not entire strangers. I knew him first as corporation counsel for the city of Toronto, and I admired him as an adroit counsel, and a sound lawyer. I knew him again as Chairman of the Railway Board, and I marvelled at times at his utter disregard of legal principles, (laughter.) I know him now as Minister of Finance, whose first work is the successful prosecution of this loan, but who has, I think, a very sincere appreciation of the necessity for national economy and prudence in official expenditure for the ifext few years if Canada is to reach the high place of prosperity to which it is entitled.
" I have also known the minister in roles which did not secure my unqualified commendation-he was a fine lawyer, an able judge, and will he, I feel sure, a national asset as Finance Minister, but his literary efforts are not all that I could wish. Some time ago, when he was a little younger, and, therefore, more prone to make mistakes,-he wrote a book,' (laughter). He wrote the book as Chairman of the Royal Commission appointed to inquire into the railway situation in Canada, and the book was called, and will go down into histqry as " The Drayton-Acworth Report." I read all of it with a great deal of interest, and some of it with a great deal of appreciation. In it he said some very nice things about the C.P.R., and then he suggested that the Government of Canada fMr. Lapointe.]
might own all the other railways and operate them under a system which he outlined. I have always wondered how a man could be so right and so wrong in the same hook."
I want to come down to the presentation of the president's view on this question:
" In this connection, and as one of the grounds on which Parliament is urged to support the proposals, it is said that if they are not confirmed and the roads are not acquired by the Government they will-to use the expressive phraseology of the Minister of Railways-be ' gobbled up by the C.P.R.' "
I can imaginesay's Mr. Beatty-
-several things worse than that (laughter and applause). It is only right that I should point out to you that there exist certain objections to this course which render the possibility of it ever taking place almost ridiculously remote. In the first pl%ce, I may be pardoned for calling your attention to the fact that there exists by statutg an absolute prohibition against any arrangement by way of amalgamation or joining of earnings between the Canadian Pacific and the Grand Trunk or any branch lines of the Grand Trunk or leased by it, or under its control. ,
In the second place the Grand Trunk duplicates in many respects, the existing facilities of the Canadian Pacific in eastern Canada which would render its acquisition by the Canadian Pacific railway both unnecessary and
In the third place, the Grand Trunk cannot be divorced from the Grand Trunk Pacific with its enormous liabilities-liabilities *
imagine no corporation in Canada would think of assuming, even though they were able to do so.
And here comes .the denial.
-the acquisition of the Grand Trunk, or any portion of it, has never been suggested to the Canadian Pacific or by the Canadian Pacific, and has never been considered or contemplated in any way or by any means direct or indirect.
Those words were exactly to the point, and in view of this emphatic denial what evidence is there to sustain the allegations made by hon. gentlemen opposite with respect to the Canadian Pacific Railway Company? Does the Minister of the Interior or the Minister of Railways know that the Canadian Pacific Company ever approached the Government or that they have ever indulged in any canvassing or lobbying with respect to the Grand Trunk? Do you not imagine, Mr. Speaker, that the Minister of the Interior would not have told us if such had been the case? I think he -would. The representative bodies of business men of the city of Montreal are against this project just as strongly as Mr. Beatty of the Canadian Pacific is opposed to it. The latter gentleman says his opposition is based on the fear
that the great interest of the Canadian Pacific in the city of Montreal and in the whole Dominion would be endangered by the disastrous deal which the Government is seeking to carry out. Mr. Zepherin Hebert, an important French Canadian represents* tive of the commercial interests in the city of Montreal, has also gone on record in opposition to the Government's policy. I am going to leave to the Government the responsibility for their own deeds.
Coming to the amendment of the hon. gentleman (Mr. Campbell), it is possible to suspect that he is the representative of some of these shareholders. In view of the sus^ picions of 'graft in connection with this transaction which have been expressed by many of our newspapers, let me say that I will not vote for anything that savours in the least of acceptance of the Bill which is before the House. In the Montreal Star of to-day there is a despatch from Ottawa which contains a very curious statement as to rumours current in the corridors of Parliament, and I shall take a few minutes to read it to the House:
Nor is the suggestion lightly treated that, from all this financial debacle, annexation'may be the possible result. The view has long been expressed here privately-that with the enormous aggregate of war obligations and the staggering load now sought to he imposed, the burden will be too heavy for Canada's people to shoulder and that the not illogical even if regrettable expedient will be absorption by a larger country, financially able to bear the overpowering strain. „
The proposition of the Government has given rise to all these queer aspects of the situation. The whole community are asking themselves: Whither are we drifting? There is no question but that financially and industrially the United States is conquering this country, and it will carry out that conquest more quickly than-hon. gentlemen opposite believe. I know the Government are not frightened at the prospect. They will placidly pursue their way administering the affairs of this country in the way that pleases them, but there will have to be an accounting some day and it will not long be deferred. If the Government only dared to put the question to the issue at the present time there is not the least doubt but that they would meet with overwhelming defeat at the hands of the people.
Hon. Mr. ME1GHEN (Minister of the Interior) : I deem it my duty, although with very great reluctance, to say a few words on this amendment. I think the House would be well advised in voting down the amendment for reasons that I have alluded
to, more or less, briefly, on other occasions, and which I will ask the privilege of recapitulating now and perhaps amplifying to some, degree. As hon. members will see from the cablegram of the 5th March, 1918, addressed by the Prime Minister to Sir George Perley for transmission to Mr. Smithers, the Prime Minister then offered a certain fixed amount in cash as rental for the system, to be assumed subject to the debenture debt. That fixed amount, as has often been repeated, was $2,500,000 for three years, $3,000,000 for five years, and $3,600,000 thereafter by way of rental. That money was to be distributed, according to the cable, among the guaranteed shareholders, the three preference shareholders, and the common stock shareholders-that is to say, the whole five classes. That was in effect an offer to the company of a certain definite sum by way of dividend per year-as rental if you call it such-or if that were not satisfactory, of arbitration of the value of those * five stocks-the guaranteed, the three preference, and the common. Consequently it is clear that it was, first of all, the desire of the Government that all these stocks should be submitted to arbitration if arbitration were the method of solving the difficulty which would be acceptable to the company. No progress was made with that proposal. It was rejected most peremptorily-as we thought most unreasonably-and the matter was pursued by negotiations overseas. It was most earnestly hoped at the time of these overseas negotiations that we could make some real progress and get to an end of them, because the end of the negotiations and the acquirement of the system was-as we viewed it and view it to-day, and as I believe every man who understands the railway situation and wished to give a judgment on the standpoint of the Canadian people views it-of the greatest possible concern to us.
The history of the operation of the Grand Trunk and the Transcontinental since, without the Grand Trunk as an adjunct to it, stretching out, as I have previously expressed it, into nothing-the history of the operation of these two roads .since shows how well advised we were in endeavouring to end all the negotiations if we possibly could. Because we did not get to the end we have lost in trying to operate these two long streaks, ending in rio traffic, $10,300,000 on one, $6,000,000 on the other, to say nothing of interest on capital in the Transcontinental. Now, we made no progress. In our endeavour to make some progress, believing that we