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Clear-Cutting the Lower Fraser Basin : Some Institutional Considerations Shearer, Ronald Alexander, 1932-; Sproul, John T. 1995

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2/20/2017  4:44 PM 1 Clear-Cutting the Lower Fraser Basin:  Some Institutional Considerations Ronald A. Shearer John T. Sproul University of British Columbia Presented to the annual meeting of the  Canadian Economics Association, 1995 I. THE BASIN The funnel-shaped lower Fraser Basin extends some 200 kilometers from the point at which the Fraser River spills out of the Fraser Canyon above the village of Hope to the Georgia Straight.  The basin is narrow in its upper reaches, delineated by steep mountains on both sides, but it soon widens into a broad valley that extends into Washington State and as the river approaches tidewater the basin becomes a wide delta.   For centuries, the river carried silt from the interior and deposited it in the valley, creating large flat areas, primarily on the south side of the river, with soil of exceptionally high agricultural potential.  The large area of the valley bottom that is not flood plains is rolling uplands with less fertile but nonetheless highly productive land.   In the mid-nineteenth century the lowlands of the south side of the river contained a large shallow lake (south and east of what is now Abbotsford), large areas that were bog and swamp and plains that were subject to flooding from the river and ancillary streams, in some locations annually and in others less frequently.  Mosquitoes were a plague.  The somewhat higher lands were coniferous forests, the wetter areas mixed stands of cedar and hemlock and the drier areas predominantly Douglas Fir.  These were classic old growth forests with many trees of enormous girth and height.  For unknown centuries aboriginal people occupied the basin and by the mid-nineteenth century the resident population was perhaps 3,000.  Not an agricultural society, they nonetheless made active use of the forests, the rivers and the ocean, and traded with neighbouring tribes.  However, for whatever reasons, technological and cultural, their economic activities did not result in major transformations of the natural environment.  While the fur trade expanded the economic opportunities open to them and encouraged a new intensity of exploitation of some of the resources of the basin, by the standard of what was to come even its impact on aboriginal economic institutions and on the natural environment was minor.   The gold rush of 1857-58 was another matter.  While, by international standards, it was a relatively minor gold rush, for the lower Fraser basin, it was cataclysmic.  The resulting arrogation of control over the land and its resources by the British government substituted a new set of economically relevant institutions for those of the indigenous inhabitants and brought new people, new technologies, new economic opportunities and incentives and new concepts of farming the land, harvesting a wide range of environmental products, timber as well as mineral, and trading on a global scale.  European settlement and the market economy were abruptly established in the basin and the aboriginal inhabitants, their societies and economies, were marginalized by the 2/20/2017  4:44 PM 2 technologically dominant immigrants.  Between the mid-nineteenth century and the mid-1930s the landscape of the lower Fraser basin was transformed.   The forests were cleared, the lake and many swampy areas were drained, and the river and ancillary streams were dyked (not entirely satisfactorily, as events of 1948 were to demonstrate).  The result was an agricultural valley, with field crops in the lowland areas and mixed farms, including importantly dairy farms, interspersed with wood lots, in the uplands.   From the outset of British occupation, agricultural settlement of the valley bottom was a primary objective of government policy.  Small pockets of agricultural settlement were established in the 1860s and by the late 1870s serious attempts to control flooding through the construction of dykes were underway and most of the prime agricultural land had been alienated through preemption or sale.1  In the forested areas, however, settlement was slow.  By the turn of the century, the forest products industries of the lower Fraser basin were booming.  Large sawmills and shingle mills had been established on tidewater (primarily in Vancouver and New Westminster) to service foreign markets and along the railway tracks on the north side of the river to service prairie markets. Logging was active along the coast and was beginning in the mountain valleys and on the mountain slopes surrounding the Fraser valley.  But on the south side of the Fraser River the Reverend King of Abbotsford was asking plaintively "... how shall I make a living from my farm in these woods?"   His answer:  ... you cannot make a success of a farm .... because of the timber.  Well, why not cut it down and burn it, and keep at it till you have twenty or thirty acres cleared, then purchase stock and go ahead.  You answer, because the labour is too great, involving years of toil and necessitating considerable capital which we do not possess.2King saw the problem as a lack of sawmills that could convert the timber from an impediment to a source of capital for the farmer, and contrasted the situation in the Fraser valley with that in the contiguous Whatcom County of Washington State.  There he saw well developed farms and over thirty sawmills buying timber and fire wood from farmers for a good price.  Fourteen years later it was still noted that in spite of the rapid growth of the city market,   Farmers -- so called -- who have held lands within thirty miles of Vancouver for the last decade or two have ignored the growing markets for produce at their very doors, and in all that time have not brought an acre under cultivation; many there are who do not grow enough for their few head of live stock, and purchase their winter supply of vegetables from more enterprising neighbours.  In the main the reasons ascribed for their failure to farm is the expense and difficulty involved in clearing the land of its heavy timber, the lack of transportation .... To clear forest land in British Columbia is a more difficult operation than in eastern Canada.   The trees are larger, and resist decay, and it is practically impossible for even the hardiest pioneer, without considerable capital, to clear sufficient of these timbered land in ten or even twenty years, to support himself and family.31 On early agricultural settlement see F. W. Howay, British Columbia from the Earliest Times to the Present, Vol. II.  Vancouver: 1914, pp. 589-602. 2 G.C. King, "Synopsis of Address on Bush Farms,"  Second Report of the Superintendent of Farmers' Institutes, British Columbia (British Columbia, Sessional Papers, 1900) pp. 1073-1075.  In the areas with the best agricultural land the problem was not trees but excess water and periodic flooding.  3 "Settlement on Timber Lands," Western Lumberman, Feb. 1913, p. 31.  In 1912 the provincial government published a circular on the removal of stumps by burning.   H. W. Sparks, "Clearing Logged-Off Land and Charpitting Up-To-Date," Agriculture Department Circular #1, (Victoria: 1912).   The widespread use of dynamite reduced the manual labour involved, but as late as 1922 the most 2/20/2017  4:44 PM 3 It was not until the late 1920s or early 1930 that the clearing of the forest cover could be said to be complete  --  some seventy years after the process began.   It is this aspect of this economic-ecological transformation of the lower Fraser basin, the process by which the forests of the valley bottom were cleared,  that is the subject of this paper  Given the agricultural potential of the land and the consistent policy to promote settlement, the interesting historical question is not why the clear-cutting occurred, but why the it took so long.  That is the question to which this paper is addressed. There are undoubtedly many factors that affected to the clearing of the land on the south side of the Fraser River.  We consider only three:   • settlement policies,  • access of loggers to mills  • access of mills to markets. II. SETTLEMENT POLICIES A. Colonial and Provincial Land Policies Two important principles of settlement policies for the lower Fraser basin were set in the earliest days of the colony of British Columbia.  The first related to the alienation of the land.  The valley was regarded as prime agricultural land and as a matter of dogma the Colonial Office insisted that agricultural land be made available only to bona fide settlers, not to "speculators."  In practice this meant that, with some important early exceptions, agricultural land would be sold or made available through preemption, in farm-size parcels (normally 160 acres or less) with the provisos that when land was preempted residence had to be maintained and a specified minimum value of improvements completed within a specified time period.  Successive revisions to the Land Act modified and refined the parameters of the policy, including relaxed residency requirements and limits on the total amount of land that an individual could acquire by preemption.4   However, the principle that the dread speculator was to be avoided became a canon of policy and the residency requirements attached a serious liability to the occupation of heavily forested land.    The second principle related to the trees.  At the time that the first plots of agricultural land were offered for sale, the Governor decreed that the trees on the land would be the property of the landowner, not reserved to the government.   In doing so, he may have regarded the trees as worthless and have been concerned that the government would have responsibility for clearing the land.  Alternatively, he may have thought that sale of timber harvested from the homestead would provide a source of capital for the settler and hence help him to finance the clearing of the land.  In any case, while public ownership of the forests eventually became a central tenet of provincial forest policy, it did not apply to land on the south side of the Fraser river acquired from the colonial and early provincial governments. effective method of removing large stumps was still a matter for research.  H.D. Scudder, "New Method for Clearing the Big Stump Land, " Timberman, February 1922.  See also "Clearing Logged-off Land," Western Lumberman, Sept. 1908. 4 The development of the preemption policy is traced by Robert E. Cail,  Land, Man and the Law: The Disposal of Crown Lands in British Columbia, 1871-1913. (Vancouver: 1976) pp. 1-58.    2/20/2017  4:44 PM 4 These decisions had an important implication.  The colonial and later the provincial governments did not sell large tracts of forested land in the valley bottom that might have supported large scale logging and sawmilling and did not take direct responsibility for the clearing of the land.5  Settlers avoided the forests and to the extent that forested lands were preempted, it was in relatively small, scattered plots.  Little of the heavily forested land was in fact settled through the 1870s.  Of course, privately held timber could be bought and sold in the open market.  However, limited, scattered settlement without efficient overland transport for bulky products meant that the scope for a south-side market in timber was also limited.  The concentration of forests in a few large holdings by logging concerns  --  perhaps on short term timber leases -- who would have had an incentive to develop the transportation facilities required to move the logs to mills and the lumber to markets would have accelerated the clearing of the land.  It is in this sense that early settlement policies may have been an impediment to the clearing of the land and hence to settlement.   In some respects forest policies changed significantly when the federal government assumed responsibility for the basin in 1883. B. The Land Transfer The Terms of Union, by which British Columbia joined the Canadian Confederation, required the federal government to ensure that a transcontinental railway was constructed through British Columbia and in support of this enterprise British Columbia was to convey to the Government of Canada "in trust" a strip of land 40 miles wide, 20 miles on each side of the mainline, from Port Moody to the Alberta/British Columbia boundary.6In addition, the federal government was to make an annual payment of $100,000 to the province, in perpetuity.7Payment of the railway belt grant began with Confederation in 1871 although construction of the railway did not commence until 1880, and, following much bickering, the transfer of the railway belt lands to the federal government did not occur until late 1883.8It is an open question whether the railway belt subsidy was considered a quid pro quo for the land transferred to the federal government.  The Commissioner charged in 1927 with investigating a proposal to return the remaining unalienated lands to British Columbia concluded that the value of the lands transferred to the Dominion vastly exceeded the value of the subsidy, and that the conveyance of the lands simply provided a 5 In the very early years some land chiefly valuable for timber was sold outright but the important acquisitions of prime timber lands were in areas with more immediate access to tidewater and large scale mills.  The government was late in defining "timber lands" and in prohibiting their sale, but the preemption system was not supposed to be used to acquire lands whose primary value was for timber.  It has been noted that in this respect the preemption system was occasionally "abused."   Cail,  Land, Man and the Law, p. 94. 6 "The Terms of Union," in F. W. Howay, British Columbia from the Earliest Times to the Present. Vol. II (Vancouver: 1914), Appendix VI, pp. 695-697. 7 There were also other important financial arrangements.  By joining Canada, the provincial government gave up its main pre-Confederation source of revenue, the customs tariff, the revenue from which would henceforth go to Ottawa.  In compensation, the Dominion government assumed responsibility for the pre-existing debt of the province (and hence provided an implicit annual subsidy of about $100,000, the interest on the provincial debt) and made direct cash transfers that in 1872 amounted to $214,000, or 40% of net provincial revenue.  The "railway belt" grant accounted for almost half of the direct cash transfer and a third of the total subsidy (including interest on the public debt). 8 The details of the agreement and copies of some of the relevant documents are in Royal Commission on Reconveyance of Land to British Columbia, Report. (Ottawa: 1928).  See also Cail, pp. 146-152 2/20/2017  4:44 PM 5 politically palatable excuse for an additional subsidy that would have been granted in any case.9   The financial arrangements provide support for this interpretation.  The railway belt subsidy was necessary to make the transfers from the federal government come close to the foregone revenue from the provincial customs tariff.  Moreover, the payment of the grant began well before the conveyance of the land, and payment of the perpetual grant was not canceled in 1930 when the unalienated lands were returned to the province.10In the Terms of Union, however, the payment was said to be "in consideration of the land to be so conveyed" and in the public accounts the provincial government described the payment each year as the "annual grant for lands conveyed."11  The assertion that the value of land transferred vastly exceeded the amount of the subsidy could itself be interpreted as political posturing to make the transaction politically palatable.  It is far from obvious what value should be placed on the land in the hands of the provincial government in 1871, particularly in the absence of the railway.   The provincial government was having great difficulty in disposing of the land to settlers.  Indeed, provincial settlement policy was in disorder.  While a considerable amount of land in the lower Fraser valley had been alienated, most of it was in areas that were not forested.  The government was having difficulty in mounting and effective surveying program and hence was unable to finalize the claims of preemptors and squatters.  Apparently the provincial land records were incomplete and inaccurate.12  Settlement was slow.  For this reason, the conveyance of Fraser valley agricultural lands to the federal government which mounted effective surveying and settlement policies undoubtedly enhanced their value beyond the direct effects of the construction of the railway.  The valley became more attractive to settlers furthering the provincial government's policy of promoting agricultural settlement.  Indeed, a primary provision of the agreement between the governments was that the lands  shall be placed upon the market at the earliest date possible, and shall be offered for sale on liberal terms to actual settlers.13C. Dominion Land Policy In the spirit the of its agreement with the provincial government, the Dominion immediately published a notice assuring settlers in the valley that their claims to homesteads would be dealt with expeditiously.14  This was followed by the publication in the British Columbia Gazette of the homestead section of the Dominion 9 Royal Commission on Reconveyance of Land, p. 31. 10 The Terms of Union contemplated a delay between the beginning of the railway belt grant and construction of the railway  --  but not as long a delay as occurred.  However, separate compensation was paid to British Columbia for the delay.  Although the terms of union called for the payment of the subsidy in perpetuity, they also implied a transfer of the lands "in perpetuity."   There was no provision for the return of unalienated land to the province at any time.  Cancellation of the grant when the lands were reconveyed may have been politically impossible given the conclusions of the Martin Royal Commission that it was not payment for the land.   We do not know the original intent of the governments, if, indeed, it was an issue that they considered.  11 Howay, p. 966; British Columbia, Public Accounts for 1st April 1932 to 31st March 1933.  12 Cail, pp. 19-35; Canada, Department of the Interior, Annual Report, 1894; 1895.. 13  Royal Commission on Reconveyance of Land, pp. 50-51. 14 "Dominion Lands in British Columbia," New Westminter Columbian, November 28, 1883; 2/20/2017  4:44 PM 6 Lands Act as it applied on the prairies, with the observation that the Dominion intended to open the lands in the railway belt for settlement on the basis of these regulations "... or to provisions similar thereto."15Applying these policies in the valley was not straight forward.  The homestead policies were designed for a setting in which agricultural land was abundant and relatively easy to break and bring under cultivation and for territory that was relatively easy to survey into rectangular townships.  In the valley, available farm land was not abundant, was partially surveyed on a different system, and in the years before Confederation, the provincial government had alienated a considerable portion of it in a patchwork pattern.  Thus, at the time of transfer, it was estimated that of the approximately 500,000 acres of agricultural land in the valley portion of the railway belt, one-third was already alienated and occupied.16  The residual, however, overstates the farm land that could be readily occupied by homesteaders.   The vast bulk of the land that had not been alienated (or occupied by squatters) was either densely forested, swamp or subject to flooding.  The residence and cultivation regulations of the Dominions Lands Act did not contemplate this type of land. Equally fundamental was the fact that most of the relevant land was not surveyed, and surveying in this terrain was difficult and expensive.   Moreover, the provincial government had permitted  --  indeed encouraged --  preemption of unsurveyed land, with the proviso that title could be obtained following a survey.   When it assumed control over the valley, the federal Department of the Interior found the provincial records of the ownership of and claims to previously preempted land were incomplete and not up to date.   Much detailed and laborious work was required to ascertain the status quo ante and resolve the claims of squatters, and much of the valley had to be surveyed before orderly settlement could occur.  In the event, the Fraser valley lands were withheld from immediate settlement.  The federal government's reticence inevitably provoked controversy.  The provincial government complained that the Dominion's policies were  retarding settlement.   The published data on land transactions of the New Westminster Agency of the Department of the Interior, while incomplete, are displayed on Figure 1 (reported homestead entries) and Figure 2 (reported receipts from land transactions).17  The land disposed of by the federal government was largely in the upland forested areas.  Although federal regulations were more stringent than provincial ones, much of the land was disposed of quickly. When the federal government opened the surveyed lands in the lower Fraser basin to sale and homesteading in 1886, there was a  strong initial flurry of activity, which dampened to a low level in the early 1890s.  It is also worth noting that there was a high level of cancellations of homestead entries, particularly in the early years, probably a response to the difficulty of clearing heavily timbered land within the 15  "Public Notice: Dominion Lands in British Columbia," British Columbia Gazette,  May 8, 1884.  The Dominion Lands policy as applied on the prairies permitted a qualified individual to occupy a quarter section (160 acres) for a $10 filing fee.  At the time of occupying the homestead he could also purchase a contiguous quarter section if it was unoccupied.  However, the homesteading right were not unconstrained.  Before a formal application for a homestead could be filed (in the jargon of the Act, before a homestead entry) the land in question had to be surveyed and formally opened for settlement.  While the rules varied from time to time, homesteading was only permitted in designated sections of the surveyed crown lands.  The balance of the available lands were reserved for sale on terms that also varied from time to time.  Before obtaining clear title to the land, the homesteader had to occupy the it continuously for three-years and break and cultivate it. 16 Royal Commission on Reconveyance of Land. 2/20/2017  4:44 PM 7 prescribed time limits.  Another less intense flurry of transactions (and cancellations) occurred just before and during World War I.  This was probably related to the development of railway transport and sawmilling capacity, as discussed below.   D. Dominion Forest Policy The Dominion Lands Act reserved the title to trees on a homestead to the crown, in contrast to the provincial practice with respect to land which was preempted before confederation.  However, the coexistence side-by-side of forested farm lands granted by the provincial government complete with title to the trees and identical lands granted by the federal government without title to the trees proved untenable.  It seems unlikely that the federal government enforced the payment of royalties on this timber (and the published revenue data do not include this as a category of receipts).  Faced with vigorous protests, including public meetings and petitions supported by municipal governments, the federal government relented and in 1899 adopted the provincial policy.18  However, a portion of the land in the valley bottom was reserved as timber land which, subject to competitive bids, was leased for large scale logging.  Similarly, timber lands within the railway belt but outside the valley bottom, including important timber areas along major tributary rivers on the north side of the Fraser, were made available as leases for logging.  A royalty was assessed for all timber harvested on these timber limits.19Although figures for some years are missing, detailed data on lumber produced from timber harvested on lands held under Dominion timber licenses was published in the annual reports of the Department of the Interior until 1916 and summary data subsequently.  Figure 3 reproduces the available numbers on lumber produced from timber harvested on lands held as timber licenses (there are no data on the output from private lands in the valley).  The figures show two distinct phases.  Until about 1906, the production of lumber from Dominion timber licenses was stable or falling as the available timber on the leased areas in the valley bottom was gradually removed.  The dramatic increase in production that began in the years before World War I reflected a change in the orientation of logging activity as limits in the mountains surrounding the valley came into production.20  Production from limits on the valley floor continued at a declining rate, until by the early 1930s they were essentially logged over.  Unfortunately, these data do not tell us anything about the logging of timber in the valley bottom that was in private  hands.  However, qualitative evidence, in the form of reports on 17 Initially the agency at New Westminster handled transactions for the entire railway belt, but in the early years the transactions were concentrated in the lower Fraser basin.  In 1890 an agency was opened at Kamloops (and later one at Revelstoke) to handle transactions in other parts of the railway belt.  The data do not include entries under the soldier settlement scheme. 18 Order in Council, July 5, 1899 19 On sawn lumber, the royalty was initially of 5% of the value of lumber sales, changed to $0.50 per thousand board feet in 1895(with a rebate of $0.40 on lumber exported from Canada) and when the price of lumber fell in 1896 restored to 5% ( with the $0.40 rebate on exports; repealed in 1901).  It was again set at $0.50 in 1907.   Order in Council, September 1889; Order in Council, July 25, 1895;  Order in Council, January 3, 1896; Order in Council, September 24, 1901; Order in Council, December 19, 1907 20 To provide a sense of perspective, we can compare the output from Doinion timber limits with total provincial output.  Data on production from provincial lands are from the Annual Reports of the TImber Inspector.  It is not clear that they are comparable to the Dominion data, and output from private lands may not be included in all years.  At best they are a rough index.   In the 1890s production fro Dominion limits accounted for perhaps 10-15% of total provincial output; by 1906 it was less than 1%.  In the early 1920s it ranged between 3% and 5%. 2/20/2017  4:44 PM 8 logging operations in the trade literature, suggest a similar pattern, with harvesting drawn out through the 1920s but essentially completed by the early 1930s. E. Conclusions Colonial, provincial and federal policies had as their objective encouragement of agricultural settlement in the lower Fraser basin.  In principle, governments supported the clearing of the forest cover.  However, apart from the Dominion timber limits, which were important but covered a relatively small area in the valley bottom, most of the timber in the valley was in private hands, in relatively small holdings.  What was required for the completion of the clearing of the valley was the development of a market in privately held timber  --  and that required an efficient overland transport system.    III. QUESTIONS OF ACCESS: TRANSPORT   A. The Structure of the Sawmilling Industry. A snapshot of the sawmilling industry in British Columbia in 1866, eight years after the proclamation of British law and five years before British Columbia acceded to the Canadian Confederation, is provided in Table 1.21  There were no shingle mills (shingles were handmade) and the sawmills were few, with a wide disparity in size.  Coexisting were mills designed to produce 50 -100 thousand board feet of lumber per day (for the time, very large mills) and mills with a capacity of 5 thousand board feet.  The beginnings of a concentration of production capacity on tidewater in the lower Fraser basin is apparent.  With the exception of the very large mill at Alberni, the three large mills were on Burrard Inlet or at New Westminster.  Moreover, this understates the effective concentration of production capacity on the coast of the lower Fraser basin.  The mill at Port Alberni had not operated since 1865 and was dismantled in 1867, and in 1868 the Moodyville mill on Burrard Inlet added a new mill with capacity of 100,000 ft. day.  In the interior, lumber production was by very small firms, producing for local markets.  While we cannot be sure that all interior mills were identified, any that were missed must have been very small.22  Apparently there were no mills in the Fraser Valley above New Westminster.   We have not attempted to trace the expanding capacity of the sawmills in the Fraser basin through the following three decades, but Table 2 provides another snapshot of the industry in 1906.  Although there were many more mills, the basic similarity in the structure of the industry with that of 1866 is obvious.  There was an 21 Table 1 is based on a federal government compilation for 1866.  A. Harvey,  A Statistical Account of British Columbia. (Ottawa: G. Desbarats, 1867)  This was an official federal publication, intended to supplement the BC Yearbook.   Carrothers states that this table is "probably inaccurate," but does not indicate the basis for his supposition.  W,A, Carrothers, "Forest Industries ...", p.  . We have added one interior mill listed in  "Some Historical Highlights on the British Columbia Timber Industry," Western Lumberman, August 1922.   No date is given for this compilation, although it appears to have been based on Harvey.   However, the date of the Harvey compilation is also uncertain.   It includes the Anderson Mill at Alberni and the Stamp Mill (later the Hastings Mill) on Burrard Inlet, although the former had been closed (1865) before the latter had installed its sawmilling machinery (1867).   From its establishment in 1865, the Stamp Mill produced spars until its sawmilling equipment was installed.    22 Gibbard states that there were two sawmills at Yale and one at Hope "in the early sixties." J. E. Gibbard,.  Early History of the Fraser Valley (UBC MA Thesis, 1937), pp. 194-195.   According to Taylor, there was only one mill at Yale.  It was moved from one side of the river to the other in 1863, when it had a capacity of 6,000 ft./day.   It may have been closed in 1866-67.   The mill at Hope closed in January 1863, when its machinery was moved to Williams Creek.   A mill was also established at Port Douglas on Harrison Lake in 1859, but was closed "in the mid-1860s."  Taylor, Timber:  pp. 14-15. 2/20/2017  4:44 PM 9 intense concentration of production capacity around Burrard Inlet and the mouth of the Fraser River, including 16 of the 19 sawmills with reported capacity of at least 50,000 board feet a day and the only 12 shingle mills with reported capacity of 100,000 or more shingles per day.  However, there were also 2 large mills along the CPR tracks farther up the north side of the Fraser.  By contrast, on the south side of the Fraser, there was only one large sawmill, in Abbotsford connected to a branch line of the CPR.  There was also a cluster of shingle mills in the south-west corner, along the tracks of the Great Northern railway.   Otherwise, apart from a medium size shingle mill serving the local needs of the emerging agricultural-service centre in Chilliwack, in the vast forested areas south and east of New Westminster the mills were small, widely scattered, and insignificant.23In analyzing the industry of 1906, it would be misleading to simply divide the mills into arbitrary categories of "large" and "small".   There was an obvious continuum of sizes.  Yet there was a profound bifurcation of the industry that was in important degree related to size.  Adapting the jargon of the day there were "export mills" and "local mills," and their businesses had very different characteristics.  The export mills had a fixed, central location on a major bulk transportation artery (the ocean or the railway) and they tended to be larger, had different sources of timber, used different technology and sold into different markets than did the local mills.  The large mills on tidewater while in the lower Fraser basin, were not of the basin.  Both their timber supplies and their main markets were external. They obtained their logs from vast timber limits on Vancouver Island, the smaller islands of the Straight of Georgia and along the coast north of Vancouver.  Rafts of logs were towed to the mills, made into lumber and shingles, loaded on ships tied up at the mill, and shipped to South America, the Pacific islands, Asia and Australasia.  Similarly, the large mills along the railway on the north side of the river obtained their logs from the surrounding hills and made them into lumber for sale on the prairies.  There were also many small mills in the urban areas on the coast.  Some were engaged in harvesting the remaining local forests, others purchased logs from log brokers acting for independent loggers with coastal timber limits.  By and large their markets were local.   Our interest is in the mills that were emerging on the south side of the river.  The larger ones obtained timber from Dominion timber limits, and shipped their output on either the CPR or the Great Northern lines to which they were contiguous.  The small local mills acquired timber from various sources, both Dominion timber 23 Unfortunately, data on these mills is very sparse.   Neither provincial nor federal agencies recorded many of them in their published statistics.  The mills in question were in the land ceded to federal jurisdiction in 1883 but the federal timber agent only reported on mills that obtained their timber from federal timber leases.   Small mills acquired their timber from privately owned land.   While the provincial forest branch in principle reported on all mills in the province, it is not always clear whether mills in the railway belt were included.   In any case, while it had a broad interest in the industry given its stewardship over provincial forests, the forest branch had no direct administrative interest in the capacity of sawmills.  No taxes or other policies were directly involved.   As a result, the branch had little incentive to pursue small, mobile and hence elusive mills intensively for capacity estimates,   Such a search would have been expensive.   As an example of the resulting difficulties with the statistics, in 1902, the provincial data on the number of sawmills made a dramatic, discontinuous jump from 32 to 105.   While some increase undoubtedly occurred, a jump of this magnitude was a reporting artifact   Thus, it was acknowledged that the 1902 figure "Includes 62 small mills. Statistics cannot be obtained showing daily capacity of all of these."   With the small mills in the railway belt, the fact that forest policy was under federal jurisdiction was another strong reason for the provincial forest branch not pursuing the data vigorously.   In a sense, the mills were not in "British Columbia."  We have identified some mills in this region from various sources (trade literature; street directories), but we have not always been able to find estimates of capacity and we cannot be confident that we have found all of them.   However, we can safely assume that the mills for which capacity data are missing were very small. 2/20/2017  4:44 PM 10 limits and private holdings.  If not literally portable they were moveable.24  By 1906 the transformation of the valley from a domain of swampy flood plains and heavily forested uplands to one of drained and dyked farmlands had begun, but the dramatic changes were yet to come.  The valley was on the brink of major transportation developments that spawned a new set of mills and accelerated the clearing of the forest.    B. The Railway Network Access of loggers to mills and mills to markets was essential to the development of the south-side lumbering industry.  Although the Serpentine, Nicomekl and Campbell rivers, small streams that drained into the ocean in the southwest corner of the region, were of some importance in the early years, the south side of the river was not endowed with large streams capable of carrying logs and lumber to the Fraser and hence to tidewater ports.  Railways were crucial. The coming of the CPR in 1886 is usually noted as the climacteric event in British Columbia economic history.  For the main agricultural lands of the lower Fraser basin, however, the railway was on the wrong (north) side of the river.  While a branch was built south from Mission through the centre of the valley to Sumas on the US border in 1891, it had little local impact.  Designed to connect with the Northern Pacific Railway for through freight, it followed an almost straight line south, missing the main forested areas.  The Great Northern Railway which built a line that made a large loop from Blaine Washington to the Fraser opposite New Westminster in 1891 was much more important.  It cut through a heavily forested area and spawned a number of sawmills and shingle mills in the southwest corner.  However, the crucial development was the construction of a railway bridge across the Fraser river at New Westminster in 1903 and of railway lines (Great Northern and British Columbia Electric) that ran west to east through the valley between then and World War I.25  They are shown on the accompanying map (Figure 4), which also shows connecting railway lines in Washington State.  The railways played an important role in the development of agriculture in the valley, providing a rapid, direct link to the burgeoning city market for fruit, vegetables, meat and dairy products.  They also cut through heavily forested areas.  Sawmills clustered around the lines, and several logging companies built private logging railways into their timber limits. The transformation of the sawmilling industry by 1919 is apparent in Table 3.  There were new and larger export mills on tidewater around Burrard Inlet and near the mouth of the Fraser.  But what is of interest is the increase in the number and size of the mills on the south side of the river.  These mills were like a swarm of caterpillars eating their way up the valley.  When one stand of trees was devoured, the mill was dismantled and moved  --  either to another location in the valley or out of the valley.  In the mid-1920s the south side industry reached its apogee, and by the early 1930s the main cutting was over.  Some small mills continued through the depression, but to all practical intents the forested lands were cleared and brought into agricultural production.  The impact on agriculture is suggested by the increase in homesteading activity around World War I noted in Figures 1 and 2.   It is also suggested by the relative increases in rural and urban population in the basin over 24 "Portable" saw mills, with the basic equipment mounted on skids or rollers, were not common in this part of British Columbia.  They were designed to handle timber of smaller size than most of that in the lower Fraser basin.  Small sawmills tended to have relatively large saws, but could be quickly dismantled and moved to new locations.  25 The subsidiary that operated the Great Northern lines was the Vancouver, Victoria and Eastern Railway. 2/20/2017  4:44 PM 11 the first two decades of the twentieth century (Figure 5). The strong growth of the urban population in 1901-1911 was concentrated in the metropolitan area, related to the expansion of the tidewater sawmilling industry.  The rural population also burgeoned as federal homestead policies took effect, reversing the disappointing effects of the completion of the transcontinental railway evident in the preceding decade.  In the second decade, rural population growth dominated, as the land was cleared, the railways were built providing access to the metropolitan market, and farming began in a serious way.   C. Conclusions  We have argued in this section that the construction of west-east railways through the valley was necessary for the flowering of the sawmilling industry and hence for clearing the forested agricultural land.  However, this is clearly an incomplete argument.  Given the lack of local mills, a logical outlet for the timber on the south side of the Fraser was the mills of Whatcom County. However, that outlet was blocked, initially by policies determined outside the province and later by provincial policy.   IV. QUESTIONS OF ACCESS: TRADE AND TARIFF POLICIES     A. Restrictions on Log Exports. The development of policy with respect to the export of raw logs is convoluted, and partly related to events outside the province.  From 1854 the then Province of Canada enjoyed a reciprocal free trade agreement in "natural products" with the United States.  When the US abrogated the treaty in 1866 and reintroduced customs duties on lumber, Canada responded with an export duty on raw pine and spruce logs.26  The extension of Confederation in 1871 brought the timber industry of British Columbia within the ambit of these duties.  Subsequently, there were virtually no reported exports of raw logs from British Columbia (Figure 6).27The purpose of the Canadian export duty on raw logs was to offset the inducement provided by the American tariff on lumber to process Ontario timber at mills in neigbouring US states.  As timber became scarcer in Michigan and neighbouring states, the pressure to import Ontario logs increased and the Canadian government responded by raising the export duty to $2 in 1886 and again to $3 in November, 1888.28  Petitions 26 "An Act to Amend the Acts Respecting Duties of Customs, and the ?Tariff of Duties Payable under Them," Statutes of the Province of Canada, 29 & 30 Vic., (Ottawa: 1866), c. 6.  The duty was suspended in the first post-Confederation Customs Act, but reinstated at $1.00 per thousand board feet and applied to shingle bolts as well as pine and spruce logs in 1868.  "An Act Imposing Duties of Customs, with the Tariff of Duties Payable Under It," Statutes of Canada, 31 Vic., (Ottawa: 1867), c. 7;  "An act to Amend the Act of the Present Session, intituled: An Act Imposing Duties of Customs, with the Tariff of Duties Payable Under It," Statutes of Canada,31 Vic., (Ottawa: 1868), c. 44 27 The exports in 1883 were of pine logs to the United States.   We suspect that they were from the southeast corner of the provincewhere, at various times, loggers had difficulty in getting logs to local mills.   In later years exceptions were made to the log export embargo for loggers in this region. We do not know if the figures on log exports can be trusted.   Although timber rafts were large and obvious, monitoring movements in the open water leading to Puget Sound would have been very difficult.  Whenever the price differential was attractive, unreported (and untaxed) exportation from coastal timber limits probably occurred.   From inland points, such as the Fraser valley, where all railway connections had customs posts, smuggling was unlikely.   28 "An Act further to amend the Acts relating to duties of Customs and the importation or exportation of goods into or from Canada," Acts of the Parliament of the Dominion of Canada, 49 Vic, c.37,(Ottawa: 1886);  Order in Council, November 13, 1888,  Acts of the Parliament of the Dominion of Canada, 52 Vic, p. xxvi,(Ottawa: 1888) 2/20/2017  4:44 PM 12 for retaliation were submitted to the US Congress and several retaliatory bills were introduced, threatening an increase in the US tariff on Canadian lumber.29  In the continuing struggle between the principles of greater protection (Republicans) and freer trade (Democrats), the protectionist forces won a battle in the election of 1888.  The debate over Canadian lumber intensified.  As the bill that became the McKinley tariff of 1890 was working its way through Congress, it included both a significant increase in the rate of duty on white pine (the lumber of concern to eastern Canadian lumber firms) and an additional penalty duty applicable to "... any country which imposes an export duty on logs."30   In July 1889, Canada backed off, reducing the export duty on raw logs to $2.31  In the event, the lumber provisions in the generally projectionist McKinley tariff that was passed on October 1, 1890, were not as severe as some had feared.  While raw logs were placed on the free list, increasing the degree of effective protection for lumber, the duty on Ontario white pine was reduced from $2 to $1 per thousand feet while the duty on other softwoods (including cedar and Douglas fir) remained at $2.32  However, the act also included a provision for the application of the preexisting duty on white pine lumber if Canada continued to apply an export tax to raw logs.  A week and a half later the Canadian government went into full retreat and eliminated the export duty on raw logs.33   British Columbia began to export raw logs to Puget Sound mills on a small scale.  The next turn of the American electoral wheel changed the balance in Congress again.  The Democrats' Wilson-Gorman Tariff of 1894 lowered tariffs to some extent, but most importantly placed lumber of all kinds on the free list.  However, the penalty provision should Canada reimpose export duties was retained and broadened to include "discriminating stumpage dues."34  The cost to Canada from imposing a mercantilist export duty on raw logs was thus accentuated.  The wheel turned again in the election of 1896, and the result was another protectionist Congress.  As US deliberations on a more protective lumber tariff progressed, with strong support from some sections of the lumber industry and opposition from others,35 the Canadian government reacted with an Act giving the cabinet the power to retaliate if higher duties were placed on Canadian lumber by reintroducing an export duty of up to $3 per thousand board feet on logs and pulp wood.36Eventually the US passed the so-called Dingly tariff which reimposed the lumber duties of the McKinley tariff, 29 "The Export Duty on Sawlogs," The Canada Lumberman, January 1889; "Petition after petition is being presented to Congress ...," The Canada Lumberman. March 1889; "Some of the American lumbermen ...," The Canada Lumberman, July 1889; "The Export Duty,"The Canada Lumberman, July 1889. 30 "Proposed U.S. Tariff on Lumber," Canada Lumberman, June 1890.    31 Order in Council, November 13, 1888,  Acts of the Parliament of the Dominion of Canada, 52 Vic, p. xxvi,(Ottawa: 1888)As in Canada, representative from the agricultural frontier states were equally vehemently opposed to a provision that they assumed would inevitably increase the price of lumber.  See for example Canada Lumberman, March 1889; July 1889  32 United States, "An Act to reduce the revenue and equalize duties on imports, and for other purposes," (Oct. 1890), The Statutes at Large of the United States of America, Vol. 26 (Washington, 1891) 33 Prder in Council, OCtober 11, 1890.  Acts of the Parliament of the Dominion of Canada, 55 Vic., p. lxxi, (Ottawa: 1890) 34 "An Act to reduce taxation, to provide revenue for the Government, and for other purposes," The Statutes at Large of the United States of America,  Vol 28, (Washington: 1895), c. 349.     35 The Canada Lumberman for January 1897 contains a summary of a conference of Southern lumbermen at which the topic was protection for the US lumber industry.   "Against Free Lumber," Canada Lumberman, January 1897.  For a contrary view see "Views of a Michigan Lumberman," Canada Lumberman, March 1897 2/20/2017  4:44 PM 13 and included an even stronger retaliatory clause  --  that "... if any country ... shall impose and export duty on saw logs ...(etc.) .... the amount of such export duty ... shall be added as an additional duty to the duties imposed upon ...  (lumber)."37  The Canadian government did not use its powers to reimpose the export duty.  With the federal government's tax policy neutralized, the policy action shifted to the provincial government of Ontario.  By an Order-in-Council of December 1897, confirmed in legislation in January 1898, the exportation of raw logs from pine harvested from crown lands in Ontario was prohibited and the courts subsequently upheld the power of the province, as landlord, to impose restrictions on the "...destination of the timber after it is cut."38.   The Ontario episode was important because it provided both a policy and its legal justification for the Government of British Columbia.  In 1901 the first step was taken toward a ban on the export of unmanufactured logs from the province.  A revision of the Land Act contained the provision that  All timber cut from Provincial lands must be manufactured within the confines of the Province of British Columbia, otherwise the timber so cut may be seized and forfeited to the Crown and the lease canceled.39The intent was to place an absolute barrier between the log market in British Columbia and that in Washington State.  The embargo was relaxed in the recession of 1907 and during World War I.  After the war it was replaced with a more flexible system of regulating log exports.   The embargo did not apply to timber harvested from privately owned land and any attempt to extend it to private timber would probably have been rejected by the courts. The provincial government resorted to its taxation powers.  The 1903 amendment to the Land Act imposed a very stiff tax, ranging from $1 to $ 5.50 per thousand board feet depending on the quality of the wood, on "... all timber cut within the Province of British Columbia," with the exception of timber on which a provincial or federal royalty was paid. 40  However, the tax was reduced to 1 cent per thousand board feet if the lumber was manufactured or used within British Columbia.   A law suit was threatened in 1905, but we have no evidence that it occurred.  It was not until 1929 that the tax was successfully challenged in court, on grounds that it was an indirect tax and so beyond provincial powers.   36 "An Act Respecting Export Duties," Acts of the Parliament of the Dominion of Canada, 60-61 Vic, c. 17 (Ottawa: 1897) 37 "An Act to provide revenue for the Government and to encourage the industries of the United States," (July 24, 1897) The Statutes at Large of the United States of America,  Vol 30, (Washington: 1899), c. 11. 38 "An Act respecting the Manufacture of Pine cut on the Crown Domain," (January 17, 1898). Statutes of the Province of Ontario, 61 Vic., c. 9 (Toronto: 1898).  The Order-in-Council is reproduced as Schedule A to the Act.  Timber harvested on private land was not affected.   The court case is "Smylie et al. v. The Queen," The Ontario Reports, 1899-1900, Vol. 31, (Toronto: 1900), pp. 202-223;   "Smylie v. The Queen," Reports of Cases Decided in the Court of Appeal During the Year 1900, Vol 27 (Toronto, 1901), pp. 172-192.  The text of the original court's judgement is in "Ontario Timber Legislation Sustained," Canada Lumberman, December 1899;   39 British Columbia, "An Act to amend the 'Land Act'," (May 11, 1901), Statutes of the Province of British Columbia, 1 Ed. VII, c.30, s. 7. 40 Italics not in the original.  The tax was graduated depending on the length of the log, its diameter and its quality.   The minimum rate for logs not over 40 feet long and diameter of 24 inches or less of grade number 3 was $1.00 per thousand board feet.  The maximum rate, for first quality logs over 80 feet long and over 48 inches in diameter was $5.50 per thousand board feet.  British Columbia, "An Act to Amend the 'Land Act'," (December 12, 1903), Statutes of the Province of British Columbia, 3&4 Edward, 1903-04. Victoria, 1904), c.30 s.92/20/2017  4:44 PM 14 The export tax effectively closed the American market for raw logs from private land on the south side of the Fraser.  The development of a south-side market in timber depended on the development of local sawmills.  To the extent that such mills would have sought American markets, their development was also retarded by American tariffs on lumber.   B. US Tariff Policy.  For British Columbia, the American tariff on lumber was a serious concern.  With the exception of a brief period from 1894-1896, to all practical intents and purposes, the tariff effectively closed the US market to British Columbia lumber until the Wilson tariff of 1913 put lumber on the free list.  As Figures 7 and 8 illustrate, while the British Columbia forest products industry had important foreign markets, the United States was not among them until after World War I.  Of course, the opening of the Panama canal was also critical, providing access to Atlantic coast markets.  However, there were also important lumber markets on the Pacific coast within the domain of the American tariff, in California, Hawaii, Panama and the Philippines.  Even with the Panama canal, without liberal tariff treatment, BC mills would have had great difficulty in competing with the mills of Washington and Oregon  --  as the events of 1932-35 were to demonstrate.   C. Conclusions It is difficult to assess the quantitative impact of international trade policies on decisions to clear the forests on the south side of the Fraser River.  However, it seems clear that both American tariffs on lumber and restrictions by Canada and British Columbia on the export of raw logs restricted the development of the market for timber on the south side of the river, accentuating the importance of the development of railway connections to the tidewater ports.  V. CONCLUSIONS  The clearing of the forest cover from potential agricultural lands in the lower Fraser basin was a consistent objective of government policy from 1860.  In this paper we have attempt to adduce some institutional reasons to explain why the process was so slow in developing.  We have found reasons in the land policies of the colonial, provincial and federal governments, in the slow development of west-east railway facilities in the valley and in international trade policies of Canada, British Columbia and the United States.  Eventually the clear-cutting occurred, and the ecology of the valley was transformed from its natural state of swamps, bogs and heavy forests to a pastoral landscape that is now threatened by the creeping expansion of the metropolitan area that was established by and developed around the export-based sawmilling industry.   Most people would have regarded the first ecological transformation as benign, if not desirable.  Attitudes toward the new ecological transformation are diverse, but few would regard it in the same light.  2/20/2017  4:44 PM 15 Figure 1 2/20/2017  4:44 PM 16 Figure 2 2/20/2017  4:44 PM 17 Figure 3 2/20/2017  4:44 PM 18 2/20/2017  4:44 PM 19 2/20/2017  4:44 PM 20 Figure 4 Railways of the Lower Fraser Valley, 1919 2/20/2017  4:44 PM 21 2/20/2017  4:44 PM 22 Figure 5 2/20/2017  4:44 PM 23 Figure 6 2/20/2017  4:44 PM 24 Figure 7 Exports of Forest Products, 1872-1896 2/20/2017  4:44 PM 25 Figure 8 


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