CANADIAN PACIFIC RAILWAY. CONTRACT WITH THE SYNDICATE. SIR ALEX. CAMPBELL. In tl:c iSciiiite on Thursday, February 3, 1881, 8ir Alex. Campbell in moving the second readinj^ of tlie Bill to incorporate the Canadian Pacifio llailway Com- pany, said : — The measure which •:his Bill presents for the iirst time for the consideraticn of the Senate is one which has been discussed for so many days and nights elsewhere, within the hearing of most of tliose gentlemen who are present to-day, and discussed by so Tnany able men, from so many different ooints of view — those who favor it, and those who have found serious objections to it — that I am afraid I shall not be able to present it to this House in any new aspect, or offer to you many argu- ments or reflections which have not already occurred to you ; but, ie[)resent- ng, with my colleagues, the Government in this House, we feel that I should be A'anting in that duty and respect whicii ,ve owe to the Senate if I did not offer juch observations as seemed to me neces- 'sary to a separate and distinct and coni- olete consideration of the measure in uhis brancli of tiie Legislature. The facts re well known to the House. I will not enter into any lengthy historical resume of tliem. They ivre to be found recorded in acts of parliament, in trea- ties, in official correspondence, and in the speeches of different members of three successive governments, sustained in par- liament for different jieriods s'nce the nnion with British Columbia. I will almost take it for granted that it will be admitted in this House, and so far as regards this discussion, that the country is pledged — pledged in every way which can impose obligations on public men — to the construction of the Canadian Pacific Railway from some point upon tlie existing system of Canadian railways to the Pacific (-)cean. It was not to be done with prejudicial haste ; it was not to be done so as to un- duly strain the resources of the country, but it was to be ilone. The resolution in the House of Commons on this point, framed at the request of Sir George Car- tier, and offered to the House by him, in he absence of the Premier, was : — " That the railway referred to in the Address to Her Majesty concerning the agreement made with British Columbia, and adopted by this House, on Saturday, 1st April, should be con- structed and worked by private enterprise, and not by the Dominion Government ; and that the public aid to be given to secure the undertaking should consist of such liberal grants of land and such subsidj' in money, or other aid, not unduly pressing on the industry and resources of the Dominion, as the Parlia- men of Canada shall hereafter determine. ' To which was afterwards added the words, " nor increase the rate of taxation." I do not apprehend that tliey will be at all controverted by any gentleman in this House wlio desires to ojipose the ))resent measure. Successive governments — the Government which made this engage- ment, the Government which succeeded it, and wiiich remained in power until Se])tember, 1878, and the present Govern- ment — have each in their turn recog- nized this obligation, and have each in their turn striven, with more or less success, to carry it out, and redeem the pledged faith of tlie coimtry. I need not, I think, therefore, detain the House in discussing the obligation which rests, oi ' > country, as far as is consistent ■with the tering which we recocrtiizod as modifying the obligation when it was entered into ; I say, as far as consistent with those ttrms, 1 do not think I need detain the House by arguing that the country is pledged to the construction of this railway. Th» undertaking is one of a very gigantic characte r — the construc- tion of a railway from a point not 250 njilos fron\ where we are now sitting to Port Moody on the Pacific Ocean, a dis- tance of 2,627 miles. I do not think we quite realize the character of the under- taking unless we compare it with some spaces which are more familiar to the imagination. It is a greater distance than from the north to the south of Kurope, further than from St. Peters- burg to Gibraltar ; further than from the east to the west of Europe ; further than from Calais to the Caspian Sea. It is longer than the Mediterranean. Hea These distances, perhaps, enable lis to realize the immense character of the tHsk which we have undertaken to carry out. To compare it with other rail- ways : it is longer than any single line of riiilway that I know ol. The longest line of railway probably in the world is the GrandTrunk of Canada,which isnow,with its Chicago connection, 1,734 miles long. The Union Pacific from Omaha to Ogden is 1,037 miles long. The Central Pacific from Ogden to San Francisco is 813 miles long, or, with its branches, 1,213 miles ; and these are the longest rail- ways in the world. The road which we are about to undertake to construct will be, when completed, 2,627 miles, so that it is a great deal longer — two-thirds longer than any railway in existence. We propose to construct it from Lake Nipissing to the Pacific Ocean. Run- ning through our own country, the route presents some great national advantages which have not failed to attract the notice of eminent men in the United States. I shall read, although it has been noticed elsewhere, a passage from a speech of the late Mr. Seward, one of the most distinguished American states- men, who isaid, with reference to this road, in a speech delivered by him some years ago : — " The route through British America is in some respects preferable to that through oiir own territory. By the former the distanao ■from Europe to Asia is some thousand miles shorter than by the latter. Passing close to Lake Superior, traversing the water-bed which divides the streams flowing towards the Arctic fciea from those which have their exit south* ward, crossing the Kocky Mountains at an ele- vation of over 3,000 feet less than at the South Pass, the road could be here constructed with comparative cheapness, and would open up a region abounding in valuable timber and other natural products, and admirably suited to the growth of grain and grazing. Having its At- lantic seaboard at Halifax and its Pacific near Vancouver Island, it would undoubtedly draw to it the commerce of Europe, Asia and the United States. Thus British America, from « mere colonial dependency, would assume a controlling rank in the world. To her other nations would be tributary, and in vain would the United States attempt to be her rival, for she never could dispute with her the posses- sions of the Asiatic commerci;, nor the power which that commerce confers. ' I have said, hon. gentlemen, that the project is to construct a railway from a point not 250 miles from where we stand to the Pacific Ocean. For G50 milos of that distance it would run on the north shores of Georgian Bay and of Lake Superior, and would reach a point at Thunder Bay on the distant shore of Lake Superior ; from Thunder Bay it would run 410 miles to Selkirk on the Red River ; from Selkirk it would run 900 miles across the prairies to the foot of the Rocky Mountains ; from the foot of the Rocky Mountains it would run 450 miles to Kamloops ; from Kamloops it would run 127 miles to Emory's Bar ; and from Emory's Bar it would run 90 miles to the Pacific Ocean, Port Moody. Of this whole distancft the Government has constructed, or is constructing, two links ; one being the 410 miles between Prince Arthur's Landing and Selkirk, and the other being 127 miles between Kamloops and Emory's Bar, known as the Onderdonk contract ; and it has undertaken by the terms of the contract now before us to construct the additional 90 miles which separate Emory's Bar from Port Moody. Of the total distance of 2,G27 miles, the Government has con- structed, ib constructing, or will construct, G27 miles, and the company agree to con- struct the other 2,000 niileB. Mr. SCOTT - bina Branch f What about the Pem- Sir ALEX. CAMPBELL — That is constmcted already ; it does not enter in this contract. The Pembina Branch is S.*) miles Ions?, rnnnlng fi-om the boundary of the United States to .Selkirk. Tliis enormous work, lion, gen- tlemen, has formed the subject of a sur- vey, the minuteness of whicii one may justly characterize as being une(]ualled in jiny work of the kind — a survey which has occupied a number of years, and has cost the country something like t.liree and a half millions of money — so that the topography of the country is well known ; and upon the iid'ormation at different stages which the engineer.* engaged on it have sent in to the Gov- ernment, various esiimates have been made of the probable cost of the construc- tion of this road. The first estimate which I have met with is the estimate of Mr. Fleming, who was for a long tim3 the engineer in charge of the railway — a gentleman of high professional and ]>ri- vatf! character. His estimate -was that tlie road would cost, between liake Supe- rior and the Pacific Ocean. $100,000,000, to which we must add the cost of the road between Lake Superior and Callen- dar Station ; this can be at-.ded according to the different estimates. Adding it according to the estimate of 1873 — that is, the plan which was formed by the Government of Sir John Macdon- ald — and under the contract which was entered into with the Allans and others, this additional piece, ac- cording to the prices and terms laid down in the contract, the further cost would be some $20,294,000. Adding that to Mr. Fleming's estimate, the total cost of the road, according to Mr. Fleming's esti- mate, with this addition, would be $120,- 000,000. Adding the cost of the same 650 miles, according to the next subse- y say now, so that I may not expose my- self to any adverse criticism hearafter, and, so that I may be thoroughly under- stood during the progress of the remarks which I feel it my duty to offer to the House, I shall, for the purjjoses of my argument, constantly treat the land as worth $1 an acre, and shall io state the calculations. Adhering to that view, then, the contract of 1873, proposed to complete this road for $84,700,000. Under the Act of 1874, it was proposed to give a cash subsidy of $10,000 per niile, making on the distance of 2,797 miles, which was then contemplated (including the Georgian Bav Branch and the PembinajBranch) $27,970,000. But to this is to be added another sum, which the Parliament of that day contemi)lated giving in addition to the expressed cash subsidy ; they proposed in addition to guarantee a certain sum at four per cent, and tenders were invited upon the basis of an absolute subsidy of $10,000 per mile, and an absolute land grant of 'J0,000 acres per mile, and those who were invited to tender were asked to state for what further sum at four per cent, for 25 years, they would undertake to construct the road. The only actual contract which took place under that proposition was a contract with Mr. Foster, formerly one of our colleagues, whom I dare Si.y we all remember. His own tender was for a higher sum, but he acquired a contract from some person who offered to do it for a guarantee of four per cent, for 25 years on $7,500 per mile. Taking that as the basis on whicli they would have gone on if they had had the opi)ortunity and cuustructed the- whole road, we would hav(^ an express casli subsidy of $27,970,000, and $20,- 977,500, under the four per cent, guaran- tee, making a total cash subsidy, under the plan of 1874, of $48,947,500, and a land subsidy of 55,940,000 acres. Valuing the land, as 1 have said, at $1 per acre, thi.H would give the total cost, under the Act of 1874, of $104,887,500. Now, under the contract of 1880,the one on the table which the Government asks the House to sanc- tion, we are iu thetirst place toestimate the cost of those portions of the road which we are constructing and whicli we have agreed to construct, and the Pembina l'> ranch. The Fort William and Selkirk Ht'ction,thePem'jina Branch and tho Kam- loops and Burrard Inlet section form 712 miles of road and are estimated to cost $27- 700,000, nearly $28,000,000. In addition to this we propose by this contract to give to the company $25,000,000 and 25,000,000 acres of land — a total of $77,700,000. So that, speaking in round figures, under the contract of 1873 tho road would have been completed for $85,000,000 ; under the arrangement of 1874 for $105,000,000, and under this contract, for $78,000,000. I have esti- mates of the cost, valuing the land at $1.50 and $2 per acre ; but it really does not make any difference in the compari- son, because it tells both ways, and only increases the comparative advantage of tlie present contract by augmenting the value of land which we save under this contract over the preceding plans, and I think the real question will be preserved more distinctly in the minds of hon. gen- tlemen by adhering to the value of $1 per acre rather than by mentioning these various valuations as the cost of the road under the several proi)ositions to which I have referred. 1 have no doubt hon. gentlemen have studied the contract and know well its i)rovisions, and I shall be exceedingly sorry to fletain the House one moment more than is necessary for a clear exposition of the subject which is brought under thei^' notice by the Bill for which I am asking tho second read- ing. The provisions of the contract divide the road into three sections, give security for construction, mention the standard which is to be adopted, refer to the various portions which the Govern- mont is constiMictini,', sti|nil:ito tlie mode ill wlik'li tlio subsidy is to 1)0 paid, excmiits tlio railway for a thou- sand miles wliei-e it runs tlirouj,'li tlio tor- ritoiv of thn Dominion as distinguisluHl from organized provincoH, from taxation I for all timo, and its lands in that t(^rri- ' tory for twenty years, or until they shall bo sold or occupied, admits cortaiii arti- cles to be used in the construction of the ]-ailway free from ,. ciistonis duties, makes sundry provisions as to the mode in which land is to be granted, by which the couu try will retain alternate sections, and, regarding y)ranches and working, and modes of raising money on bonds, and as regards the distribution of the money. The subsidy, as hon. gentlemen kn«w, is to be i)aid on the central section of 900 miles across thn prairie at the rate of $10,000 per mile ; on the western sec tion. from the Ilocky Mountains to Kamlcops, at the rate of .$13,333 per mile ; and on tho eastern section, between Callendar Station and Thunder Bay, 650 miles, at $15,384 per mile. The land grant is divided as follows : — Central section 1 2,500 acrosjper mile Western section ... . .. IG.fiCC " EaHtern geotion 9,615 " The object being to secure in every way the construction of those various sections by reserving in the hands of the Govern- ment sutficient land and money to guar- antee it, and I may here point out that A similar provision as regards the section on which criticism has been most close was to be fovmd in the Act of 1871. By that Act $10,000 was appropriated to each mile of the whole road, including the prairie section, and it was proviiled that each section might be taken up and executed by itself as any other section might, respect, the upon the same be observed that that, in so two projects footing. It under the this are will pre- sent which the House arrangement, is now asked to sanction, we should be giving the company $26,- 000,000 less than under the plan of 1874 and something like $7,000,000 less than under the contract of 1873. But, in ad- dition to getting onr I'ailway for less than \inder either of these plans, we get other advantages upon which I think a great xleal of stress should be laid : we get rid of tho managoincnt and sale of tho lands which, under th(! arrangement of 1874, the Government continued to assume the charge and expense of. Mr. SCOTT — Two-thirds wore re- tained ; tho other one-third was given to the contractors. Sir ALKX. CAMPBELL — Well, as regards two-thiids of tho land grant, that makes a dillerfjuce of a very serious antl im])ortant character. [ do not think that anybody can make an aji- proximato estimate of the expense which will be saved by the management and sale of the lands being given to the company in- stead of being retained in the hands of the Government, but I can say this, that we have road and heard it vehemently u-ged by leading gentlemen in the ( )pposition that the cost and expense of managing tho lands would swallow uj) the whole value of them. But I think we get a further advantage on which a great deal of stress should be laid. With the control of these lands placed in the hands of tho railway company and the necessities which their enormous un- dertaking imposes upon them, it must follow that they will settle that country. I should rather br disposed to consider that the construction of the railway was not the greatest part of their undertaking. They have undertaken, in addition to constructing a railway, to people a conti- nent. If they do not send sett'ers in very large numbers into the North- West, it is impossible that the lands could be of any value, and the railway would be lessUian valueless ; it would be an unsupportable burthen. The success of their scheme depends u[)on their being able to stnd a large number of settlers into the North- West. The expense of so doing, which has not been dwelt upon, will entail a very great burden uj)on this company. To send settlers into that country in such numbers as would give traffic to the rail- way would require an enormous expendi- ture of money, and of intellect. It will require the establishment of agencies all through Europe, extensive advertising, subsidies to the papers, subsidized pas- sages, arrangjments for conveying emi- grants from Europe to the North-West, and a thousand details which must in- volve great anxiety and an immense ex- penditure of money. It will be an enor- mous tax upon the resources of those who 6 have entered upon tluH uiulertaUing. Look at the number of enii,000, and during that tin)o we procured 97,000 settlers, showing that the cost to the (Government was at the rate ofneaily $18 per head. With all the exertion used by the Government and the ex- j)3ndituro of this large amouno'of money, with the agencies that we had in Great Britain and Ireland, Germany and !N'orway, and with all tlie machinery ■whicli was put in operation, dui-ing these five years the immigration only arrived hero at the rate of 20,000 persons ])er annum. But this Company, if their railway is to succeed, if tliey are to secure traffic for it, must have immigration on a much larger scale than this. They must, I should say, settle in the North- West every year after next year, 100,000 l»ersons, and it will be the crucial point of the success of the whole undertaking which they have assumed, and should be considered and weighed earnestly when reflections are made u])on the money and lands which it has been said liave been given to them with a pi-ofusion which has been characterized, 1 am told, as pro- fligate. In addition to that, it must be borne in mind also that tliey cannot settle one of their sections without assist- ing the settlement of the adjoining sec- tion ; so the country may expect to have the settlement of our country greatly facilitated. It must be remembered that the Company get but 25,000,000 acres out of some 200,000,000 or 25«,000,000 of cultivable land in the North- West, and the rest, which remains the patri- mony of the country, will be settled, in all human probability, mainly by the exertions put forth by this Company to settle their own lands. In addition to the settlement of the lands we get the operation of the railway. It has been looked upon as an additional instance of the extreme recklessness of the Govern- ment that they have given this railway to the ConnHiny. True, they iiave given it to the Company, and the arrange- ment of 1874 proposed the same thing, but is not the true view thai the Company undertakes the burden ( It is H gift which will tax them consitierably. They undertake the burden of lunning^the road forever, ;tnd security is given for the running of it for ton years, because it is well known that the running of the railway in the earlier jmrt of the history of the country would bo a great tax upon the resources of thu company. Estimates have been j)ut for- ward of the cost of rniming railways, and I have before me the cost of running the road which connects Quebec and Halifax for some years. The expenditun! will 8ur[)rise some hon. gentlemen when they hear it— $2,960 per mile. Multi- plying the length of the Canadian Pacific Railway, 2,712 miles, by this rate, wo get the enormous sum of $8,031,000— in round numbers eight millions. Mr. Mackenzie estimates it at $0,750,000, a sum which is supposed to be based on the ordinary working expenses of the [utercolonial Railwa5' in 1871-5, the cost per mile that year having been $2,420. These two amounts are tho estimates put forward as the probable ex])ense of working the Pacific Railway. I say that in addition, therefore, to constructing the road and managing tht) lands, and the advantage we have in tho prospective settlement of the country, this company undertakes a very burden- some task in agreeing to operate the railway from the time it shall be finished, and havinsr to do so during a long period when per- haps the traffic will be small and the returns light. Evidently, the cost, under the best circumstances, must bo five or six millions per annum, and the receipts during the early history of the road, for ten or twelve years, must be compara- tively small, so there will be a serious loss which must be considered before hon. gentlemen can fairly say that the sum given by the Government to the contractors is excessive or more than it should be. Then, in addition to that, they undertake to equip that portion of the road which the Government con- strucos. The cost of equipping a road is estimated at $2,000 per mile, which woMld give, for 712 miles a million and a half of money. All this the comi)any undertake to do in addition to building the road, and yet the comments are for the most i)art on the cost of the line as a work of construction, and no stress is hiid upon the other burdens and expenses which the company assume. Now, 1 have tried to dcBcribo the con- tract as it is, I liave tried to describe to you the under- taking which the company has entered into — to draw a distinction between what they liave to do and what the Government has to do, and to portray to the House wliat tiuther responsibilities, in addition to the construction of the railway, are imposed upon the Company. To this jilan of ours which you will observe is a cheaper one than any that has ever before been proposed to Parliament, wliich is S2G, 000,000 less than the proposition of Mr. Mackenzie's Government in 1874, and six or seven millions less than the propo- sition of Sir John Macdonald's Govern- ment in 1873 — to this proposition, which involves so many advantages to tlie country, some of which I have attempted to describe, and imposes .so many burdens upon the Company whicli I have attempted to describe shortly- — to this proposition a great many objections have been taken. It would be impossi- ble for me, and I should feel that I was trespassing upon the patience of hon. gentlemen if I should attempt to reply to and meet tiie various objections which have been made. They have been urged at great length, and reiterated with a ]iertinacity, ifnd in various shapes, in a way which I am sure hon. gentle- men havfa noticed, and I am satisfied that the hon. members in this House, who are opposed to this contract, will admit that nothing more in the way of conten- tion could have been desired than has already been shown else- where by gentlemen who are opposed to the measure. I shall take up some of the more important of those objectioi.s, because T think it should be done in the discharge of my duty repre- senting the Government in this House and presenting this measure for your consideration. It ha.s been said in the first place that we have given the com- ]»any a great deal too much money — that wo are giving them ;i?25,O00,0O0, and that we have spent, or are committed to an expenditure u]ion the railway of $28,000,000, making a total of !!i;53;000,- 000. In considering this point let us look for a moment at the assistance which has been given to railways in the United States. Mr. SCOTT — Does the hon. gen- tleman include in this $28,000,000, tiie cost of surveys '] Sir ALHX. CAMPBKLL— I in- clude the cost of those ))ortions of the survey which relate to the line of railway, a little over $1,000,000 I am told. It was not necessary to include the $3,500,000, which is the cost of the exploratory survey of the territories, from east to west and from north to south, but only the portion of the cost of the survey for the sections of tim road as now adopted, amounting, as I have said, to $1,000,000, which sum is, I am in- formed, properly applicable to this work. Very opportunely for the jiurpose which I have mentioned of ascertaining what had been done in the IFnited States on this subject. I came '.ipon a speech the other day in Congress made by Senator Blaine, of Maine, wlio said : — « It was a remarkable tact that Congrci-s though they had not done anything in tlio interests of the United States on the Ocean, had paBsed 92 Acts for the aid of traaBtnission by rail : it had given 200,000,000 acres of land worth now about $1,000,000,000, and $70,000,- 000 in cash." 1 desire to draw attention to this states, ment as showing that in other countrie- sitnated as we are, a similar course haa been pursued to that which we are adojjting in Canada. I also desire to draw attention to this fact, that of the $53,000,000 which, under this arrangement, the country will expend for the purpose of constructing this railway, more than $24,000,000 are involved in the works already under contract, or absolutely con- structed. A portion of those works included in this sum for contracts let by the Government, ot which my hon. friend was a member ; and a considerable por- tion has been jdaced under contract by the present Administration. Bat what I wish to call attention to is the fact that the country is at present without thi* Bill, committed to the expenditure of $24,093,700 made up as follows : — 8 Lnke Rupi>rior to tSelkivk 1-I,705.0o0 Pfiubiim Branch 1.556/JOi) Kamloops to Emory's Bar 8, 43 1, ROD Total consti 4 or under contract 'J4,G93,70a "Which will U Uie amount of nionoy dealt with by t\u >seiit Bill, ami whieli Parliament is now ,keJ to commit this country to .*:2S,30G,300 of whicii §25,- 000,000 go to this company and !?3,306,- 300 to construct the railway from JCmory's Bar to Port Moody. The total expenditure in money, however, from beginning to eiul, will bo as I have said. $53,000,000. The interest, at 4 per cent., upon this sum, amounts to $2,120,000, but take the expenditure to which we are committing ourselves by the present Bill, and which, as I have shown, is less than 129,000,000 (the other |;24,000,000 representing contracts al- ready entered into, and the Pembina branch already conritructed) the interest upon this amount, which, for the jnirpose of this calculation, I will put at $30,000,000, would be $1,200,000 per annum. Against this let me suggest for a moment the probable result of the peopling of that country by immigrants, and the probable result to the revenue of its settlement, even in its infancy. I have before me a statement of the re- venue per capita of the country. It amounts in some of the Provinces to $3.00 per capita; in some to $3.05; and in Manitoba and British Columbia, where the consumption of goods is more in proportion to the population, the amount is larger, being $9.14 in Mani- toba and $10.32 in British Columbia. Huppost? we divide that by half, and say the revenue from settlers in the North- West will be $5 per head, 100,000 set- tlers would yield $500,000 to the re- venue and 500,000 would yield $2,500,000, which would be more than the interest on the whole cost of the rail- way — $53,000,000. Supposing that through tlie exertions of this Company which they are obliged to put forward, because the success of the enterprise depends ii|)on the rapidity with which they settle their lands, suppose through their exertions that in three years 500,000 people are settled in the North-West, we would get a revenue from them of $2,500,000 per annum. Of course, there will be a great mauy other charges, but «till a considerable proportion of that revenue may l>e very properly considered in the hands of tlie country for thn pur- pose of assisting in bearing the burden which this measure will impose upon it ; but we are told not only have we given too much to the Comi)any for constructing this line, but that the price per mile is too large. It is pointed out that the prairie section will not cost more than 810,000 per mile. Eh passant, I may remark, by a statement laid upon the table by the Minister of Kailways tlie other day it apjiears the lirst hundred miles west of Winnipeg cost .^l;5,r)00 per mile. But let us look at the cost of other railways in other parts of the country, and not only in Canada, but in the United States. I have had a state- ment ])repared of the average (;ost per mile of Canadian railways. I will give the amounts in round ligures. The Grand Trunk Ptailway cost $100,000 per mile; the Great Western, $42,000 per mile ; the Intercolonial, $50,000 per n)ile ; the eastern division of the Quebec, Montreal, Ottawa and Occidental, about $28,000. ]\Ir. SCOTT — It cost about $30,000 a mile. Sir ALEX. CAMPBELL — Then the Prince Edward Island Railway, which runs through a level coun- try, and would represent not unfairly some of the country thi'ough whicli the Pacific Railway is to pass, cost $17,424 a mile. I have had a statement prejjared of tlie cost per mile of the vaiious railways in the United States — of those in Minnesota and Dakotah, and in the whole grouj) of Western and So\ith Western Stiites, which present very much the same topo- graphical peculiarities as our own west- ern country. Some of those roads are very much like the one wo have now under consideration. Those in Minne- sota and Dakota!) especially are very similar to our own. In IVIinnesota there are 2,724 miles of railway, which cost $05,000 per mile. Mr. SCOTT — Watered s^ock. Sir ALEX. CAMPBELL— No, it is the actual cost of construction per mile as given in Poor's book. In Dakotali there are 138 miles of railway, which cost $24,000 a mile. The average 9 cost of rail ways in tlio Wostorn and Soutli-Western States is $40,000 per mile. Tlio total of all the railways of tlie United States is 84,715 miles, which cost iji4,4:lG,r)10,8r)7, or $52,000 a mile. In Canada the cost per mile, leaving the Grand Trunk llailwav out of the ques- tion, varies from $14,428 to $50,000, and in the gi'oup of States which I have named fro'n |23,000 to §C5,000. i do not think it is an unftvir thing to con- clude, as gentlemen speaking, in the other branch of the Legislature did a few days ago, that our road might reasonably and faii'ly be calculated to cost, for 1,000 miles of it west of Winnii)eg, $10,000 per mile, and for other portions, amount ing in all to another 1,000 miles, $40,000 per mile ; or a total of ten millions for the one and forty millions for the other and for this the company get $25,000,000 and 25,000,000 of acres of land. I do not think that it is at all an unfair calcu- tion. I think from the statistics given, hon. gentlemen will admit it is not an unfairj calculation in com- parison with the cost of railways in the Ignited States, and the cost of existing lines in Canada. Then, it is said that ■we give too nuich land — that tlie 25,000,000 of acres is an enormous amount of land to give. In the first place l)efore we discuss that, I desire to present to the House the amount both in land and money which Parliament has repeatedly placed at the disposal of the Government — the Government of 1873, and the Government of 1874, I (J note from a speech of the Minister of Eailways delivered elsewhere. In 1873 the cash subsidy authorized by Parlia- ment was $30^000,000, and the land grant 54,700,000 acres. In 1874, at the instance of the Government of which my hon. friend (Mr. Scott) was a member. Parliament placed in the hands of the Government a subsidy of #10,000 and 20,000 acres of land per mile for a road 2,797 miles in length — equal to $27,970,000 in cash, and 55,940,000 acres of land, and that is over and above a distance of forty miles from Calendar Station to what at that time was intended to be the point where the eastern end of the Pacific Railway was to commenco, so that Parliament has again and a£:;ain placed in the hands of the Kxecutiv(? for the time being a very large amount more of laud and monev than we proi)OSH to o.\pend. lu speaking of this land, I desire to present this con- sideration to the House : the land is not givon to this company in the same sense that money is given. When vou give $25,000,000 in money that money w gone ; it is of no nior(i use to the coun- try. But give them 25,000,000 acres of land and that laud is not gone, but in many senses renuiins and liecomes of nuich more value to the country than ever it was before. These lands aro not poured into the St. Lawrence as you pour water. They remain ours as On- tario is ours, and Quebec is ours, and when they come to be peopled with pros- perous settlers and afford comfortable homes to immigrants, we shall find them a hundred times more valuable to us than they have been in their existing state. I have said as much as I desire to say about the land and money, my sugges- tion being, in general terms, that the ex- penditure in cash involved in this meas- ure is $29,000,000, which will impose a tax oC $1,100,000 per annum, and the revenue yielded by settlers upon the lands, which must be settled in order to make the luidertaking prosperous, will amply repay the country for that expenditure. 1 say with refer- ence to the land that we aro not giving it away in the sense of its being lost to us, but placing it in a posi- tion in which it will be more valuable to us than it has ever been before. It is said that we have adopted an improper standard in taking the Union Pacific Railway as it was in 1873, as that upon which our railway is to be formed. When the debate began in another place, it was supposed that we had taken as a standard tlie Union Pacific Railway at i* period prior to 1873. That error, if it was an error, was innnediately rectified by a letter from the contractors, who stated that they understood, as the Gov- ernment did, that the Union Pacific Rail- way, as it was in 1873, was to be the standard. Mr. SCOTT — Is that mentioned in the Bill ? Sir ALEX. CAMPBELL — No; btit it lias been mentioned in a letter written by the contractors to the Gov- 10 prnment, which hasheeu read in ancther place. ^Ir. SCOTT — Wiiy not amend the Bill ill that senae ? Sir ALEX. CAMPBELL — It would l>e inconvenient, aud 1 do not think it is necessary. Mr. MILLER — It is a declaration ]>y the parties as to the construction of the cla\ise. Sir ALEX. CAMPBELL — I have looked into the state of the Union Pacificj^Railway in 1873, and find that in August of that year the Government Inspectors of the United States were sent over that road to examine it, and in the December following they made the following report to the Secretary of the Interior : — ^ KiTRACTB/rom a report made by the Oovernment Direclors of the Union Paeific Railroad to the Secretary of the Interior, in Dec, 1873. " A risitfttion of the line of the road was made by three of the GoTernmcnt Directors during the month of August last. The entire line was passed orer hy daylight and the examination made suggested some subjects of interest, upon which we deem it advisable to to report." * ... " The Government Directors found the road its equipment, and the appointments neces- sary to the maintenance thereof in a condition highly satifactory. Probably no equal num- ber of consecutive miles of railway in the United States can be found in better condition." Nothing can be stronger than that ; nothing more, I think, is required to show clearly that the standard we chose was a good and safe standard. It was chosen because the Union Pacific ran in the same direction over the same ob- stacles, meeting the same prairies and mountains as our railway meets and overcomes. Mr. MILLER — It was the same standard in the second Syndicate. Sir ALEX. CAMPBELL— And as my hon. friend from Richmond says, the same standard was adopted in the second offer. 1 have looked at the business done by this road in 1873, be- cause you can infer from that whether the road w^as in a good or a bad condi- tion. I find that it carried I74,8!H pas- sengers more than ninety-tive millions of miles, and 487,484 tons of freight over 223,000,000 miles; the net earnings, over and above working expenses, amounted to $5,291,000. A road that can carry that number of passengers and that amount of freight over so many miles, pay all expenses and net to the good $5,791,000, is a road in good order. 'Chen, another objection is that it is a gigantic monopoly. It wiis necessary to make it a monopoly in a certain sense, but that it is a gigantic monopoly in any sense prejudicial to the country I entirely deny. In the first place, it must be borne in mind that the road will run west not far from the parallel of Winnipeg. We will suppose that it runs on that parallel — it does for the finst hundred miles, and I believe for the second hun- dred also — it may afterwards run a little south, but it turns to the north again. There is no monopoly of any description north of the line. The country on the north side of the Pacific Railway is left perfectly free to anybody and tverybody, and no provision whatever is contained in the charter making a limitation of anv kind. The greater part of the country is to be found to the north of the line not to the south of it : to the north an immense territory stretches out towards the Peace River, containing the bulk of the valuable country. To the south there is a monopoly in this way : that all railways must run in a westerly or southwesterly direction, and only the Pacific Railway Company itself is allowed to run lines in a southerly or south- easterly direction. Mr. SCOTT — Hear, hear ! ' Sir ALEX. CAMPBELL — My hon. friend says " Hear, hear." The object of that iu to prevent other people — I will show presently why there is no danger to be apprehended from the Pacific Railway Company — from con- stricting railways which would carry off b\isines8 to the south by lines through Minnasota and Dakotah. But there is no occasion for such a restiiction as against the Pacific Railway Company, because they will own the whole line of railway running from Selkirk to Thunder Bay and eastward, north of Lakei Superior and Huron. Fifty millions of money will be involved on their \\art in the raaiutainiug of business oa the line of 11 tlie Pacific Railway. Wliat danger, tlierefore, so far as they are concerned, is there that tliey will build lines elsewhere to take business frojn it ] They can have no other object but to get traffic for their road. Other people are not cut out. It is not said that other lines shall not be built south-westerly, but they must come to Parliament for authority, and the difference between the Pacific Railway Co. and the others is this : they are allowed to build anywhere, while others only build in a certain dii-ection, a«d must come t« Parliament for the right to build. This Company is interested in preserving the business on the Pacific Kailway. They must, in order to make their undertaking a suc- ce.S8, bring all the business they can to the Pacific Railway, and therefore they are allowed to build branches. The very name "branches" conveys the idea of roads which will be feeders, tri- butaries to the trunk line. The mo- ment they construct a line to carry ti-aflic away from the Pacific Railway it ceases to be a branch line ; so I do not think there is any danger there . This view, which seems to me a very just one, is strongly put forward by a paper published in St. Paul. It is said by some gentlemen who are opjK)sed to this measure that the Syndi- cate will carry ofi' business to the south because they are interested in a road run- rung to St. Paul ; but it must be borne in mind St. Paul is not a terminus. The freight must go to Cbicago and New York. Therefore they are supposing this: that this Company, owning a line of railway through Canada which cost them 150,000,000 will, for the i)urpo,se of getting business for a comparatively short line of 480 miles carry off freight from the longer line and run it to the States. They have nothing to do with the lines connecting St. Paul's with New York, and is it not unreasonable to sup- pose that they will carry off basiness to the line in which they have a com- paratively small interest *} It must also he borne in mind that by giving them the right to build branches running to the Eouth it will enable them to carry business to the Pacific Railway. In the future it is confidently believed by gen- tlemen who have given attention to the subject tha*- the business of Dakotah and Minnesota will come to us and pass ovfi the Pacific Railway to Montreal and down the St. Lawrence. That is tiie re- sult which is contemplated and which seems very ])robable — oni- much more probable than the other suggestion — and which is the view put forward by the writer in the St. Paul papor to which I have alluded, and which I shall detain the House a moment to read. It is as follows : — " If tliey owned and controlled that portion of tiie Canada Central or CiiDada Pacific east of Sault Ste. Marie it would be obviously (ov their interest to make it the outlet for their Minnesota system i)y a connection between St. Paul and Sault Ste. Marie. They would thus carry their freights to the seaboard for the greater part of the distance over their own lines, instead of being dependent, as they now are wholly, on the Chicago lines terminatinii; at St. Paul and Minneapolis. They do not own a mile or a foot of railroad between St. Paul and Chicago, and they have, therefore no interest whatever in feeding those lineK, or in diverting to them the traffic either ot their Minnesota lines or of the Canada Pacific. On the contrary, it is plain that if they owned the Canadian Pacific eastward from the Sault Ste. Marie they would have a vital interest iu making it the outlet not only of their Cana- dian Pacific business, but of all their Minne- sota and Dakota business which might be destined to the seaboard. A connection be- tween St. Paul and Sault Ste. Marie would be to the St. Paul, Minneapolis and Manitoba an imperative business necessity, because in n(« other way could they make the eastern section of the Canadian Pacific pay. " We suppose it is a plain business propo- sition that their earnings depend upon the amount of business th»y do on their own lines, and not on those of some other cor- poration ; that therefore they will necessarily make every effort to secure all the busine^ii they can for their own lines, and especially to see that their own business shall, if possible, go over their own lines. It is not at all probable that thf eastern section sf the Canadian Pacific could for many years be made to pay its running expenses except through a connection with the Minnesota and Dakotah system of railroads. In order to make it pay enough to render it worth their while to invest their money in building it, they must find means to throw all the traffic not only of the Canada Pacific, but of their Minnesota and Dakota roads upon it. Its whole commercial value to them depends on their making it the eastern outlet of their Minnesota system, which they can only do by connecting it with Sault Ste. Marie. The idea that they would deliberately divert the traffic of the Canada Pacific and of their Min- nesota and Dakota hlines to the Chicago and New York railroads, in which they have not a dollar's interest, from the eastern outlet built 1: and owned by theiusulvfts fit ft tost of many liiillions of money, is the most preposterous absurdity which was ever liatcLed by partis: , extrava^faiico." Anotlier olyectiou wliicli' was taken to the arrangoinoiit was that tlio company niiglit impose any rate of freight they pleased npou the future inhabitants of the oonntiT and the rates charged by the St. Paul, Minneapolis and Manitoba llailway have been quoted. Since that objection was taken we know that it Avas mentioned in the other House by the Minister of Ivailways that an amendment to the Consolidated Railway Act will be introduced which will clear up any diffi- culty on tliat point. I do not myself think that there was any real ground for apprehension in the contract as it stood. It was nrged that the Govern- ment could not reduce the freights below a sura which would pay ten per cent, on the capital of the company. It was contended by those who were opposed to the Bill that the meaning of this Wiis the amount of money used in constructing the road whether furnished by the com- pany or by Government subsidies. The charter fixed the capital at #25,000,000, and w^e thought it was clear that it was upon this sum, or so much of it as might be paid u}), that the 10 per cent, applied. It was argued on the other hand that the rates could not be controlled until the company eai'ned ten per cent. upon what the road cost, whether in s\ibsidy or in money. I do not think that construction was the true one, but even ' if it was, it has |been remedied since in the way mentioned in the other branch of the Legislature by the Minis- ter of Railways. The Bill to wliich he referred will be introduced this session, and will apply to this railway, and to all other railways in the country. Then it has been objected to this measure, there is an exemption from taxation which is altogether an anomaly and which will have the effect of putting a great many millions into the pocket of this company, and depriving the country same amount of money. I do not think that I can explain that more clearly or in better terms than was used in another place by a gentleman whose attention had been directed to it. In the first place it was -.irged by an ion. gentleman in that House that the amount involved in this (juostion was .^21,000,000 — thattliis exemption from taxation was ecjiiivalont to giving the company .'^21,000,000. He had arrived at that by a process which I shall s|)eak of i)reseutly. It was urged by another gentleman that the exemption was wortii §10,000,000. These are expressions and exaggerations which I thought would have been retracted when the oxi>lanatiou WHS given. They may have been ; T do not know ; but tlie mistake was one whicli had boon arrived at in the manner whicii I shall explain. The true amount involved was stated, upon a calculation wliich I think every one will concur in, to be $0,181 per annum. To arrive at that calculation 1,000 miles must be taken as tlie distance to whicli the exemp- tion applies. It does not apply to any land in Ontario or Manitoba or Britisli Columbia, but simply to the prairie section which is in the North-West Territories, and for those 1,000 railes, making a calculation that the lands are worth even as much as lands are rated at in Ontario, and estimating 12 acres to the rnile, whicli is more than suffi- cient, and, allowing 3,000 acres for sidings and buildings, which is also much more than sufficient, and, estimating that land is worth $12. 14 an acre — as is done in many counties in Ontario — making the calculation upon the total distance on this estimate $432,000 is the value of the exempted land on which the railway is built ; and assessing it at a rate above the average rate in Ontario, a cent and a half, gives $6,481, which is the amount, or more than the amount, of exemption from taxation, so far as I'egards the railway itself. Now, let us see whether there is anything unusual in exempting railways from taxation. We all know how ready in this part of Canada people are to give aid to rail- ways ; how ready municipalities are to assist them, and how constantly it is done. I have before me a statement of the various amounts which have be(m given in aid of railways by municipalities, by the different provinces, and by the Dominion. The amounts are as follows : By the Dominion $66,166,530 Ontario 3,915,517 Quebec 10,877,015 Nova Scotia 1,894,350 New Brunswick 3,:!08,000 Total «;86,161,422 13 And by numicipiilities in : — Ontario i?8.00n.Ooa Quebec ;!,()00,00(t Nova Scotia 275,000 Now Bninswicli 2'J(;,000 Total §12,782,000 Altogether a total of $98,000,000 fi-oiu the Dominion, tlio provinces and the municipalities. I should think, in the tace of that, that it would hardly be (Contended there wsis anything un- usual or extraordinary in our conceding that point. It must be borne in mind, 'also, that municipalities are constantly ready to aid railway enter|n-ises. Take the town of Winnipeg, for iiistance. The other day it offered to give thirty acres of land in the heart of the town for the sho])s of this Pacific Rail- way, and to exempt them from taxation for ever. We all know that municipali- ties are constantly anxious to get rail- ways to establish works and shops within their limits, and always ready to exempt them from taxation, and, after all, this is the amount of this clause. We have been told also, that we should not have exempted the lands from taxation. I should like to know what company would consider this land grant of value if it was to be taxed the moment they got it. The exemption is for twenty years or until the lands are sold or occupied. If the lands were taxed immediately, instead of being an advantage to the company they would be a great burden, because almost as soon as settlers get in there the lands might be seriously taxed, and the belief that they might be would militate very much against the Use which the company might make of them as a security to borrow money upon. This exemption has been spoken of elsewhere as worth an enormous sum of money, and my hon. friend the Minister of Railways, was charged with throwing away $23,000,000 of money by it, and the Union Pacific was quoted as paying $835,000 a year in taxes, whereas it turned out that they had paid that sum in seventeen years. It is difficult to say what the exem[)tion may be worth, but cer- tainly more than twenty millions less than the estimate T refer to. But it must be borne in mind that if the lands are to be exempted for twenty years, unless sold or occui)ied, the effect of that exemption on the volume of tax- ation of the country is the only contri- bution the future ))opulation of the North- West is making to the cost of con- struction of the railway. W'o in this part of the Dominion have contributed to the constructing of railways in all directions at a cost of $98,000,000. The population of the North-West will come party from these provinces, it is true, but chiefly from Europe. Immigrants will settle there and iiave all the advau- tag«s of railway comnuinication, with all the increased value it gives to their proi)erty and crop.s, and the chief contri- bution which they will make is the addi- tional taxation which the fact of the ex- emption of these lands will swell the gross burden of the country to. I do not think that can be considei'ed in the least uiifair ; on the contrary, it seems to me a proi)ositiou which is reasonable and right in itself. Then, we find also that it has been the custom in the United States. We find that taxation is not imposed on the lands of the Union Pacific Railway. We find in the various States of the Union — Minnesota, Da- kotah, and in other States, Texas particularly, the lands which have been given to railways are exempt from taxation. That system may possibly have been pushed too far, and it may be said about the United States that, altho\igh the lands of the railways are exempt from taxa- tion, yet, in consideration of having these lands, the companies jiay a certain State tax. In most of the States they pay a State tax, but not in all, but that woiild not affect the actual settlers, or help them in their local wants. Suppose there was a State or Dominion tax im- posed on this Railway, that would not assist the settlers, but come to the Do- minion revenue here. It would not aid the settlers to build roads and bridges, and would have no direct effect on their finances in any way, but would impose a burden on the company for the benefit of the Government, and not for the benefit of the settlers of the country. And it must also be borne in mind that we have made the most liberal arrangements as regards education for them, by which their children and descendants will have lesser and higher edu- cation without the expense of a farthing. u Then, lion, gentlemen, another objection has been taken, that there is an imnumity fi'om customs duties. The immunity from customs sounded very badly at fir.st, apparently. There was a good dtal said about it, and our friends were very anxicHis about it, while the opponents of the iiK'asure wei-e highly elated to think they luid found such a strong point, as they thought, against the scheme itself. But when it comes to be debated it does not seem to be a serious thing at all, and certainly not one which has attracted latterly as much attention as it did at first. I ha\e had a statement i>repared of the jH'obable amount of exeiiptions from duty under the Syndicate contract In the first ]>lace we have had the steel rails mentioned, but steel rails are free from duty now, and will be for. two years ; then there is the duty on fish- ])lates, they are also free. The Minister of Finance, who introduced that measure which took off the duty, said last year that the exemption on rails and fish- plates would be maintained until the country is able to produce its own steel rails, but if it had been for two years certain what would be the result ! The company could and would probably have imported all the steel rails required for the construction of the Pacific Railway during the next two years, and they could have at once obtained an advance from the Government for the purpose of paying for them. The result of this measure may be the construction of steel rails in the North-West. It is very likely, indeed, that with this enormous enter- prise before them the company may find it to their advantage to utilize the iron and coal of the North-West and construct their own steel rails. The duty on the steel rails for the whole distance would be $362,934, and on spikes $17,438, but the whole of the duties which are affected by this clause will not, under any circum- stances, amount to over $120,000 ; and it has been announced in another place that part of the project which will yet be submitted to Parliament will include the making of an allowance to manufacturers in tliis country to balance this exemption from duty, and put them in the same po- sition of advantage which they now hold towards foreign manufacturers as regards those items that may be imported duty free ; so that those who manufacture similar articles in Canada, going into tha construction of the Pacific Railway, will have the same relative advantage over those who are importing into this coun- try as they have now. I have now gone over, I think, the principal objections. I did not intend to refer to every objection, nor do I intend to bring under the no- tice of the House the second offer which was made and which was referred to just now, in a remark made by my hon. friend from Richmond. I do not propose to discuss that offer, •r to draw the atten- tion of the House to it at preseut. It does not seem to me to be an offer neces- sarily involved in the discussion of the scheme on the table, sofur as I am con- cerned, and so far as the duty I am now discharging is eoncerned, and I desire to present the present schecie without re- ference to it. Nor do I desire to go fur- ther into the other objections which have been raised. I am content to have endeavored to place before the Hou.se a clear statement of the project itself, and to have answered the more serious objec- tions which have been taken to it. L«t us pause one moment to reflect what will probably follow if this contract should go into execution, as I hope and trust it will ; what a stimulus it will give to all the industries and trade oi the country ; what ships it will bring to our ports with immigrants ; what stimulus it will give to our manufacturers by the expenditure of enormous sums of money for the construction of the railway, in- volving all kinds of articles of trade, supplies and imports ; what a stimulus it will give to trade, commerce and manu- factures of every description 1 What a stimulus it will give to immigration and the settlemen of the country ; how it will increase the population of the North-West ; what advantages it will afford to those of our fellow subjects in England, Ireland and Scotland who may be anxious to leave their native land and still settle under the British flag ! I do not wish to draw invidious compari- sons. 1 did not 1 what was done by the late Govoiuraent i.i any spirit of party warfare, but I adverted to it for the legitimate purpose of drawing a com- pai'ison between the efforts put forth by the two Governments, and, I think, I have established that the effort we are now making is one far more entitled to 15 the a])[)ioval of Parlianieut and of the country than tht> one which thoy made. 1 think I have also established that the arrangement itself, and by itself, is an advantageous contract for the coun- try. I am afraid that I have detjvinod the House by a sj^eech of intolerable length, but I was very anxious to submit a clear statement of this great scheme, and, if I have done that, 1 have accomj)lished the full purpose for which I rose, I tr«st that the measure will meet with the approbation of the House. The Government look forward with as- svired hope to its proving of great advan- tage to the country. It's execution has been placed in the hands of men who are eminent in the practical work of railway construct'ion, sufficiently skilled and suftlclently experienced, and who have financial resources sufficiently strong for the project ^vhich they have under- taken. I trust they will succeed in their great enterprise, and that those of us who may survive until 1892 will find this work completed, and, through its means, the settlement of many hundreds of thousands of people in the great North- West ; people who will be enjoying happy and pi-ospevous homes, "with pros- pects as bright as those of the denizens of any part of the world, and who will in the future maintain with us the British flag on this continent, and feel with us that freedom and order are more fully secured under its folds than under any form of government which human in- genuity has yet invented.