February 1942, No. 5 Upper Canada Railway Society Bulletin (Toronto) Page 1

Railways and confederation: a brief sketch

John William Griffin

In this paper it is my purpose to tell something of what Oscar Skelton calls that close connection between politics and railways which is distinctively Canadian(1) That such exists is an inescapable conclusion but a case may be made for both sides of the connection; the one, that federation brought railways, the other, that railways were responsible for federation. The truth is probably that they were so deeply connected that such speculations lack even academic interest and that it is best to consider that railway progress and the movement for union went hand in hand. George Glazebrook seems to be of the opinion that the two were together responsible for federation for he says that It was the combination of .. the two .. motives(i.e., the economic and the political) that gave strength enough to the union movement to carry it to completion.(2)

The nature of the Canadian economy had considerable subtle influence on the matter under discussion. From very early times, indeed before the conquest, the Canadian economy had been aimed at an exploitation of the American west—the old idea of the Great Lakes being a dagger pointed at the heart of the continent. It took many generations to make the merchants of the St. Lawrence Valley realize that the attraction of their river could not compete with the attraction of the Mississippi and Hudson Rivers. When this was realized the first step in the change from continental to national economy had been taken. Commerce on a wide scale required transportation and the new form of transportation—the railway—even granting private ownership, required governmental aid and cooperation between the colonies.

Montréal the, financial centre Canada, was inclined to adopt a smug attitude towards the necessity of connection with the ports in the Maritimes, knowing fully well that it could control all the external trade of Canada. For seven months of the year it was a seaport itself. for the other five, well—shippers could wait until the ice broke up. The passing of the Bonding measure by the American government in 1845 ended this complacency since now goods could be shipped through the United States during the winter months. This had the natural effect of encouraging the building of railways to the seaboard entirely within British territory and of making the Province of Canada realize that it might have something in common with the Maritime Provinces after all.

Early evidence of the former is to be seen in the outburst of interest in railways that came with the late 'forties and 'fifties of the last century. I think it is safe to say that, by 1850, the importance of a railway connecting the inland colonies with the sea was generally recognized. Of course, the two groups had different motives. The Canadas wanted ice-free ports, the Maritimes wanted contact with the interior since they saw in Canada a new market. Both attitudes assumed the construction of a railway, which became an integral part of the union scheme.(3)

The idea of an intercolonial railway hod long existed in British North America, having first been proposed(as far as is known) in 1827. Durham had recommended it in 1839, saying that it would render a general union absolutely necessary. For almost twenty years the people of the Maritimes sought to obtain Imperial support for the project, succeeding only in 1867. In the late 'forties several routes for the intercolonial line were surveyed, the most famous and the one finally adopted it is the present main line of the Canadian National from Rivière du Loup eastward) having been explored by a Major Robinson of the Royal Engineers. It was proposed that the three provinces, Canada, New Brunswick and Nova Scotia should build this line jointly and that New Brunswick in addition should build a connecting line to Portland, the funds for the whole to have an Imperial guarantee.

To secure aid from Britain Joseph Howe went to England in 1850 and after much negotiating secured a communication from Earl Grey, Colonial Secretary, that led Howe to believe he had secured everything he sought. He wrote home that the colonies had triumphed and a meeting was forthwith held in Toronto (June, 1851) at which representatives of the provinces worked out the details of the agreement. All went well until the ambiguity of the Colonial Office note came to the surface in the government statement that it would have nothing to do with backing the Portland connection. This difficulty was circumvented be altering the route so that more of New Brunswick was served, Nova Scotia being pacified for its proportionate loss by a reduction in its share of the expense. This time Hincks and Chandler went to England, Howe with drawing at the last moment, and again sought aid. The government refused any support whatever on the technical grounds that the former promise of a guarantee had referred only to Major Robinson's route. This was the end of the early attempts to link the provinces together.

It must not be supposed, however, that the failure was complete, for something had been accomplished. That the colonies saw fit to attempt joint action of this kind at all is significant for it evidences an awakening national consciousness. Such things as joint appeals to Whitehall for aid cannot but have impressed the British Government and events like the meeting in Toronto of 1851 augured well for the future union. Many years later, when questioned as to why a federal union had been adopted in Canada, Edward Watkin answered that, had the intercolonial been built when the provinces first wanted it, it was quite possible that a legislative union would have been effected. But the passage of almost twenty years had allowed so many separate interests to develop in the unconnected colonies that only a federal union was possible. If this view is accepted it offers a prime example of the influence railways (or should I say the lack of them) played in the fulfillment of confederation. However, the Home Government must not be criticized too severely for its failure to act at this time for, having just given up many of its privileges and prerogatives in the colonies, it was naturally ill-disposed to keep on assuming financial burdens.

No sooner had the hopes of a speedy construction of the intercolonial line faded away than Canada plunged into its first railway building era with the chartering of the Grand Trunk Railway of Canada in 1852. This line was able to take advantage of the provincial Guarantee Act of 1849 which promised aid to one half of any line over seventy-five miles in length. It also opened the way for overseas control of Canadian railways in that Hincks, in his position of Inspector-General, favoured the claims of the English contracting firm of Betts, Brassey, Jackson and Peto for the construction of the line as against those of Alexander Galt and his associates. The English firm soon showed that its lack of knowledge of American conditions was to be financially disastrous. Francis Hincks' railway policy in total cost the government of Canada about $33,000,000 in principal and interest(4) since it was seen admitted that advances to the company were gifts and not loans.

It was soon recognized that drastic measures would have to be taken to rescue the Grand Trunk and the investors had high hopes of a better future when Edward Watkin was sent to Canada to see what could be done about what he called an organized mess. Watkin and his associates were being forced to the view that the G.T.R. must concentrate its attention on purely Canadian and not on American traffic. Indeed the Royal Commission which investigated the road in 1861 was critical of the existing traffic policy. Granted then that the line must become a Canadian artery of traffic, what conclusion were the Directors forced to reach? They could not help but admit that their railway started nowhere and ended nowhere. This is, of course, an exaggeration but it conveys the idea that the line was incomplete at each end. Accordingly, both westward and eastward expansion became of importance to the investors. The intercolonial line was needed to carry the steel east from Rivière du Loup and Watkin and his associates began to give serious consideration to westward expansion also. It was with this object in view that he and his business partners bought into the Hudson's Bay Company in the early 'sixties. In this connection it is of some interest to look at a Western view on the matter of transportation.

In January of 1863 a Memorial was drawn up in the Red River Colony in Manitoba and despatched to the great engineer, Sandford Fleming, who had agreed to bring it to the attention of the various governments concerned. Among many other things, the Memorial stated that if the railway were built from Lake Superior to Fort Gerry, a regarded as part of a future system reaching the Pacific that, Great Britain would have an unbroken series of colonies, a grand confederation of loyal and flourishing provinces.(5)

The men behind the Grand Trunk, with their great financial stake in British North America, ware naturally beginning to wonder how best to save their investment. They realized, as noted above, the need of both eastern and western connections, and also saw that neither could be secured by the Province of Canada alone. To undertake the development of the West was beyond the scope of the province's abilities. Also, the sectional strife between Canada East and Canada West was of importance in this regard. Canada West cared very little for the intercolonial project but was vitally interested in the Hudson's Bay Company lands; Canada East eager1y awaited the intercolonial but had less interest. in the West.

Hence the political aspirations of the railway men can be seen: To secure a union powerful enough to build the interco1onia1 line and rich enough to buy out and open up the great West. With the line to the sea-coast opened up, all the traffic of Canada would pour over their rails and to this might be added in time the wealth of the yet-unsettled West.

Despite all that I have said it is not to be assumed that the railways already built did not contribute anything to confederation; indirectly they contributed much. By 1860 the three provinces were well-served by railways, in view of the relative sparseness of the population. These lines made commerce infinitely more efficient and contributed not a little to the prosperity of the colonies. In Canada, especially, in view of the Reciprocity treaty with the United States, were the railways of value. This general prosperity had its effect, for great schemes, other than destructive ones, rarely flourish amid poverty.

To this plan of the railway men to exert their influence in the interests of union (Watkin was knighted for his part in Confederation) other pressure was added by the American Civil War and the increasing fear felt in high places that the United States had designs on the great company's territories in the West. American influence went further when, in July of 1866, a bill was introduced in the United States House of Representatives proposing terms on which the provinces might be admitted to the Union. It is of interest to note that Watkin waxed furious over this affront to the Queen's sovereignty. The important thing to remember however, is that article IX of this bill promised governmental aid to both intercolonial and Pacific railways.

By this time negotiations for confederation were far advanced and it is of value to note the give-and-take in railway matters that took place between the provinces. The Maritimes regarded the building of the intercolonia1 line as a prime condition of entrance into the union. Canada agreed to this on condition that the Maritimes accepted a clause stating the early consideration of a Western railway to be of importance also. It seems worthy of repetition, however, that the Maritimes wou1d not have consented to union at all without the pledge of the immediate construction of the railway which they had been seeking during twenty years.

The British North America Act was finally passed at Westminster in March, 1867, and the Canada Railway Loan Act immediately followed. This latter guaranteed the interest on a Canadian loan of £3,000,000 for the construction of the line joining the sea and the central regions.

Confederation was .. the fulfillment of an old dream, made possible by the linking of economical1y complementary areas by railways.(6) To the men of 1867, who had fought so long for the Intercolonial Railway and had laboured a lesser time for federation, it must have seemed that their transportation problems were over. It has been Canada's unfortunate lot to suffer before 1867 from too few railways and since 1915 to suffer from too much railway.

References (1) Skelton, OscarThe Railway Builders, p. 53; (2) Glazebrook, G.P.A History of Transportation in Canada, p. 191; (3) Ibid, p. 192; (4) Breithaupt, W.H.Outline or the History of the Grand Trunk Railway of Canada, R&LHS 23, p. 43; (5) >Burpee, Lawrence J.Sandford Fleming: Empire Builder, p. 64; and (6) Glazebrook, p. 195.

Other Sources Seton, Leonard A.The Intercolonial Railway 1832-1876, CRHA 14 & 15; Shortt, AdamThe Financial Development of British North America, 1840-1867, CHBE 6; Skelton, OscarThe Life and Times of Sir Alexander Tilloch Galt; Spriggs, W.M.The Great Western Railway of Canada, R&LHS 51; Trotter, R.G.The Coming of Confederation, CHBE 6; and Watkin, EdwardCanada and the States.

Railways: G.T.Ry., I.C.Ry.